Exhibit 10.1


 


SWORN STATEMENT IN PROOF OF LOSS


AND FULL AND FINAL SETTLEMENT, RELEASE, AND INDEMNITY AGREEMENT


 


I. FINAL PROOF OF LOSS


 




	
  Various
  Layers USD 1,250,000,000

  	
   

  	
  PROP
  05-01

  
	
  Amount
  of Policy at Time of Loss

  	
   

  	
  Policy
  No.

  
	
   

  	
   

  	
   

  
	
  1st
  July 2005

  	
   

  	
  Houston,
  Texas

  
	
  Date
  Issued

  	
   

  	
  Agency
  at

  
	
   

  	
   

  	
   

  
	
  1st
  July 2006

  	
   

  	
  Alliant
  Insurance Services, Inc. f/k/a JLT

  
	
  Date
  Expires

  	
   

  	
  Agent

  






 


 


To
the Various North American, British and Continental European Reinsurers at risk
of North America, United Kingdom, Germany, Switzerland, France and
Bermuda.  At time of loss, through
various facultative reinsurance certificates, you reinsured International Risk
Insurance Company, who insured Huntsman Corporation by All Risk
to the property described in the above indicated policy according to the terms
and conditions of said policy and all forms, endorsements, transfers and
assignments attached thereto.


 


1.             Time
and Origin:  Fire occurring
at the hour of 07.28 a.m., on the 29th day of April 2006.


 


2.             Occupancy:  The property described, or containing the
property described, was occupied at the time of the loss as and for no other
purpose whatever: as intended.


 


3.             Title
and Interest:  At the time of
the loss, the interest of the named insured in the property described herein
was as intended.  No other person
or persons had any interest therein or encumbrance thereon, except: none.


 


4.             Changes:  Since the said policy was issued, there has
been no assignment thereof, or change of interest, use, occupancy, possession,
location or exposure of the property described, except: (a) the sale of
the A&O Plant located in Port Arthur, Texas pursuant to the 15 February 2007
Asset Purchase Agreement by and among Flint Hills Resources, LLC and Huntsman
International, LLC, Huntsman Petrochemical Corp., Huntsman International
Chemicals Corp., Huntsman Polymers Holdings Corp., Huntsman Expandable Polymers
Co., LLC, Huntsman Polymers Corp., and Huntsman Chemical Co. of Canada, Inc.,
the 22 June 2007 Amended and Restated Asset Purchase Agreement by and
among Flint Hills Resources, LP, Flint Hills Resources, LLC and the above-named
Huntsman entities, and the Letter Side Agreement effective 22 June 2007;
and (b) the sale of the assets of the U.S. butadiene and MTBE business,
including the C4 Plant located in Port Neches, Texas, pursuant to the 5 April 2006
Asset Purchase Agreement by and among Texas Petrochemicals, LP and Huntsman
Petrochemical Corp. and Huntsman Fuels, LP, including the 27 April 2006
and 14 June 2006 amendments thereto.


 


5.             Total
Insurance:  The total amount
of insurance applicable to the aforementioned loss on this property was, at the
time of the loss, USD 1,250,000,000.


 


6.             The Total Amount Claimed under the
above-numbered policy for the property damage and time element losses described
in paragraph No. 1 herein is USD 475,000,000 as agreed.  This includes prior 


 


1

















 


payments
totaling USD 365,000,000, and a final payment of USD 110,000,000 pursuant to
the terms of the Full and Final Settlement, Release, and Indemnity Agreement
below.  The Total Amount claimed
represents a compromise between the parties to this Full and Final Settlement,
Release , and Indemnity Agreement, and the payments made in respect of this
Final Proof of Loss are subject to the conditions set forth in the Full and
Final Settlement, Release, and Indemnity Agreement below.


 


II. FULL AND FINAL
SETTLEMENT, RELEASE, AND INDEMNITY AGREEMENT


 


This
is a Full and Final Settlement, Release, and Indemnity Agreement by and between
Huntsman Corporation (“Huntsman”), International Risk Insurance Company
(“IRIC”), and Ace American Insurance Company, Chartis Property Casualty Company
f/k/a AIG Casualty Company f/k/a Birmingham Fire Insurance Company of
Pennsylvania, Allianz Global Risks US Insurance Company, Arch Reinsurance
Company of Nebraska, AXIS Specialty Ltd.,(1) Limit No. 2, Ltd.,
Commonwealth Insurance Company, HDI Industrie Versicherung AG, Simon Andrew
White as Lead Underwriter for Heritage Syndicate 1200 ROC at Lloyd’s, in his
Individual Capacity (Heritage Syndicate 1200 ROC at Lloyd’s), R. J. Kiln &
Company, Ltd., Cathedral Underwriting, Ltd., Munich Reinsurance Company (Mūnchener  Rūckversicherungs-Gesellschaft AG), Partner
Reinsurance Company, Ltd., SCOR UK Company, Ltd., Wurttembergische Versicherung
AG, Zurich American Insurance Company, XL Insurance (Bermuda) Ltd. (“XL”), and
Max Re, Ltd. (“Max Re”) (collectively “Reinsurers”).


 


WITNESSETH
THAT:


 


WHEREAS (utilizing the
defined and capitalized terms above and below), Huntsman procured Policy No. PROP
05-01 (“Policy”) through its wholly-owned and controlled captive insurer, IRIC,
and


 


WHEREAS, the Policy
insures Huntsman for property damage and time element losses, subject to stated
terms, limits, deductibles and waiting periods, and


 


WHEREAS, IRIC
concurrently reinsures 100% of the Policy’s designated risk through various
facultative reinsurance certificates issued by various reinsurers, including
Reinsurers herein (“Certificates”), and


 


WHEREAS, on April 29,
2006, there was a large-scale fire in the ethylene refrigeration and processing
area of the Port Arthur Base Chemicals Light Olefins Unit in the Aromatic and
Olefins Plant (the “A&O Plant”) in Port Arthur, Texas (“Loss”).  The A&O Plant was, at all relevant times,
owned and operated by Huntsman Petrochemical LLC f/k/a Huntsman Petrochemical
Corporation, an indirect, wholly-owned subsidiary of Huntsman Corporation.  Huntsman Petrochemical LLC is included in the
definition of named insured under the Policy, and


 


WHEREAS, Huntsman
sustained property damage and time element losses at its A&O Plant
resulting from the fire which occurred on April 29, 2006, and


 


WHEREAS, a dispute
arose among Huntsman, IRIC, and Reinsurers regarding, among other things, the
degree of insurance and reinsurance coverage for, and the ultimate quantum of,
the Loss.  Thereafter, two separate
lawsuits were filed in which Huntsman, IRIC, and Reinsurers were named parties:
(i) Ace Am. Ins. Co., et al. v. Huntsman Corp. and IRIC,
U.S. District Court for the Southern District of Texas; Civil Action No. 4:07-CV-02796
(“Ace American Action”) and (ii) Huntsman Corp. v. IRIC v.
Ace Am. Ins. 


 






(1) AXIS Specialty Ltd. is referred to
in the pleadings filed in the Arbitration and Federal Actions as AXIS Specialty
Limited Bermuda.


 


2

















 


Co., et
al., U.S. District Court for the Southern District of Texas, Civil Action No. 4:08-CV-1542
(“Huntsman Action”) (collectively, the “Federal Actions”),(2) and


 


WHEREAS, on December 29,
2008, Huntsman, IRIC, and Reinsurers entered into a Settlement Agreement and
Arbitration Submission Agreement, whereby they agreed, among other things, to
resolve their disputes through mediation, and if mediation was unsuccessful,
through arbitration rather than in court.(3) Specifically, the parties
agreed to dismiss the Huntsman Action and stay the Ace American Action until
the rendition of an arbitral decision and the satisfaction of any arbitral
award, and


 


WHEREAS, Huntsman and
Reinsurers are currently named parties to the following arbitration:  Huntsman Corp. v. Ace Am.
Ins. Co., et al. (“Arbitration”),(4) presently pending before
Honorable John S. Martin, Honorable Layn Phillips, and Honorable James
Carrigan, and


 


WHEREAS, various
reinsurers, including Reinsurers herein, have currently paid Huntsman USD
365,000,000 for amounts claimed by Huntsman for property damage and time
element coverage as a direct result of the Loss pursuant to certain Sworn
Statements in Proof of Loss, dated November 13, 2006, March 16, 2007,
June 18, 2007, and December 19, 2007, and pursuant to a Sworn
Statement in Proof of Loss dated December 29, 2008, which was executed
subject to the terms and conditions of the Settlement Agreement and Arbitration
Submission Agreement referenced above, and


 


WHEREAS, Huntsman,
IRIC, and Reinsurers wish to fully compromise and settle finally and forever
any and all disputes and claims arising out of, relating to, or in connection
with Huntsman’s and/or IRIC’s claims for property damage and time element losses
resulting from, related to and/or which could have resulted from the fire at
the A&O Plant that occurred on the April 29, 2006.


 


NOW
THEREFORE, in full consideration of the foregoing and of the
agreements herein contained and intending to be legally bound, Huntsman, IRIC,
and Reinsurers agree as follows:


 


A.            Definitions:


 


1.             “Agreement” shall mean this
Full and Final Settlement, Release, and Indemnity Agreement.


 


2.             “Loss” shall mean any and
all property damage, time element losses and/or other losses or claims of any
nature resulting from, related to and/or which could have resulted from the
fire at the A&O Plant that occurred on April 29, 2006.


 


3.             “Huntsman” shall mean the
Named Insured as defined in Section 1 of the Policy, and all other
additional named or other insureds as defined in the Policy, and any and all of
its present and former officers, shareholders, directors, attorneys, employees,
partners, limited partners, members, subsidiaries, affiliates, parent,
successors, predecessors, sister 


 






(2) Swiss
Reinsurance Company was also a party to the Federal Actions.  Max Re and XL were not parties to the Federal
Actions.


(3) Swiss Reinsurance Company, Max Re,
and XL are also parties to the Settlement Agreement and Arbitration Submission
Agreement.  Therein, the Parties agreed that Swiss Reinsurance Company
would pay the remainder of its quota share and be dismissed from all
litigation, released from all claims relating to the Loss, and would not be a
party to the mediation or Arbitration.  The Parties also agreed that XL
and Max Re would pay their quota share of the USD 40,000,000 payment made
pursuant to the Settlement Agreement and Arbitration Submission Agreement, in
exchange for the release and other provisions contained therein, but would not
be a party to the Arbitration.


(4) Max Re and XL are not parties to the
Arbitration.


 


3

















 


or related companies or entities that claim or may claim to be an
insured or a reinsured, or in any way insured or reinsured, directly or
indirectly, by the Policy and/or Certificates.


 


4.             “IRIC” shall mean
International Risk Insurance Company, and any and all of its present and former
officers, shareholders, directors, attorneys, employees, partners, limited
partners, members, subsidiaries, affiliates, parent, successors, predecessors,
sister or related companies or entities that claim or may claim to be an
insured or reinsured, or in any way insured or reinsured, directly or
indirectly, by the Policy and/or the Certificates.


 


5.             “Reinsurers” shall mean
collectively Ace American Insurance Company, Chartis Property Casualty Company
f/k/a AIG Casualty Company f/k/a Birmingham Fire Insurance Company of
Pennsylvania, Allianz Global Risks US Insurance Company, Arch Reinsurance Company
of Nebraska, AXIS Specialty Ltd., Limit No. 2, Ltd., Commonwealth
Insurance Company, HDI Industrie Versicherung AG, Simon Andrew White as Lead
Underwriter for Heritage Syndicate 1200 ROC at Lloyd’s, in his Individual
Capacity (Heritage Syndicate 1200 ROC at Lloyd’s), R. J. Kiln &
Company, Ltd., Cathedral Underwriting, Ltd., Munich Reinsurance Company,
Partner Reinsurance Company, Ltd., SCOR UK Company, Ltd., Wurttembergische
Versicherung AG, Zurich American Insurance Company, XL Insurance (Bermuda) Ltd.,
Max Re, Ltd., and any and all of their present and former officers, directors,
employees, partners, limited partners, shareholders, owners, members, names,
reinsurers, subsidiaries, affiliates, successors, predecessors, parent, sister,
or related companies or entities of any nature, attorneys, managing agents,
run-off agents; consultants, adjusters, or advisors.


 


6.             “Parties” shall mean
Huntsman, IRIC, and Reinsurers as defined herein collectively.


 


7.             “Person” shall mean an
individual, corporation, limited liability company, partnership, association,
trust, any other legal entity or organization, and any State, Federal or local
government or any government or quasi-governmental body or political
subdivision or any agency, department, board or instrumentality thereof.


 


8.             “Policy” shall mean Policy No. PROP
05-01, with effective dates of July 1, 2005 to July 1, 2006.


 


9.             “Certificates” shall mean
the various facultative reinsurance certificates issued collectively by
Reinsurers for reinsurance of the Policy.


 


10.          “Released Parties” shall
mean all reinsurers that severally subscribe, each in his or its own
proportionate share, at all layers to the reinsurance of the Policy, including,
but not limited to, the Reinsurers that severally subscribe, each in his or its
own proportionate share, to the reinsurance of the Policy as set forth more
fully in Schedule A, and any and all of their
present and former officers, directors, employees, partners, limited partners,
shareholders, owners, members, names, reinsurers, subsidiaries, affiliates,
parent, sister, or related companies or entities of any nature, attorneys,
managing agents, run-off agents, consultants, adjusters, experts, or advisors
including without limitation:


 


a.             Their respective heirs,
executors, administrators, successors, predecessors, assigns, insurers, and
reinsurers;


 


4

















 


b.             Any other person that has
been acquired by, merged into, or combined with Reinsurers and their past or
present subsidiaries, affiliates, successors and assigns; and


 


c.             Any of their insurers,
reinsurers and/or retrocessionaires.


 


11.          “Settled Claims” shall mean
any and all manners or causes of action, suits, debts, accounts, promises,
warranties, damages (consequential, extra-contractual, exemplary or punitive),
agreements, costs, pre-judgment interest, post-judgment interest, attorneys’
fees, expenses, claims or demands whatsoever in law or in equity related to the
Loss, whether presently known or unknown, asserted or unasserted, whether
sounding in tort or contract or arising under the statutes or administrative
regulations of any jurisdiction or under any allocation agreement with any
Person with respect to any and all past, existing, potential, present or future
claims of any type whatsoever related to the Loss that Huntsman or IRIC ever
had, now has or hereafter may have, fully and finally:(5)


 


a.             For any insurance coverage,
including indemnification under any and all claims with respect to the Policy
and/or Certificates related to the Loss, any actual, alleged or threatened
claim or obligation, whether known or unknown, which currently exists or will
subsequently accrue, which Huntsman or IRIC ever had, now has or hereafter can,
shall or may have, for or upon or by reason of any manner, cause or thing
whatsoever, whether now known or unknown, fixed or unliquidated, conditioned or
contingent, whether obtained by subrogation, assignment or otherwise howsoever
related to the Loss, including Huntsman’s claim for coverage, that has been made
or could be made to IRIC or Reinsurers, now or in the future, with respect to
the Policy and/or Certificates, under any of their sections, related to the
Loss.  This Agreement applies to any and
all damages of any nature whatsoever, including without limitation, property
damage claims, preservation of property claims, extra expense claims, expedited
expense claims, time element claims, business interruption claims, contingent
business interruption claims, appraisers’ fees, auditors’ fees, arbitrators’ fees
or expenses, consultants’ fees, attorneys’ fees, pre-judgment interest,
post-judgment interest and/or any other damages against the Released Parties
arising out of, or in any way connected with, whether known or unknown, or
which could have arisen out of, the Loss; and


 


b.             Arising out of or related to
any act, omission, representation, or conduct of any sort of Reinsurers in
connection with the Loss for which Huntsman or IRIC could seek compensatory,
exemplary, extra-contractual, punitive, statutory or other damages or relief,
based on alleged breach of contract, bad faith, breach of the duty of good
faith and fair dealing, unfair claim practice, unfair trade practices,
deceptive trade practices, any alleged improper act or failure to act in
connection with the underwriting, investigation, handling, adjustment or
settlement relating to the Loss, other alleged misconduct or other
extra-contractual claims relating to the Loss, or any obligations arguably
arising under any statutes or administrative regulations of any jurisdiction in
any way related to the Policy and/or Certificates arising out of or relating to
any act, omission, representation, or conduct of any 


 






(5) Certain of these claims were
previously released and settled under the terms of the Settlement and
Arbitration Submission Agreement dated December 29, 2008.  By including such claims in the “Settled
Claims” description herein, it is not intended to and does not alter or modify
the prior release of claims contained in said agreement.


 


5

















 


sort in connection with the Loss, whether or not those claims are now
known or unknown, currently exist or subsequently accrue, for any act,
omission, representation or conduct of the Reinsurers in connection with the
Policy and/or Certificates related to the Loss.


 


c.             With respect to the Settled
Claims, it is Huntsman’s and IRIC’s intention to reserve no rights or benefits
whatsoever under or in connection with Huntsman’s or IRIC’s claims against
Reinsurers for coverage or benefits under the Policy, Certificates, or
otherwise in connection with or with respect to any past, present or future
claims in any way related to the Loss and to assure Reinsurers their full and
complete peace and freedom from such claims related to the Loss and from all
assertions of rights in connection with such claims under the Policy and/or
Certificates related to the Loss.


 


12.          “Settlement Amount” shall
mean the gross amount of USD 475,000,000, which includes the gross amount of
Previous Unallocated Payments as defined herein from Reinsurers. The Settlement
Amount (being USD 475,000,000) less all Previous Unallocated Payments (being
USD 365,000,000), equals a gross final payment amount of USD 110,000,000, which
shall be paid to Huntsman by each individual Reinsurer, based on its quota
share percentage, by check or wire transfer by the earlier of thirty (30) days
from the execution of this Agreement by all Parties or June 30, 2010.  To be clear, Reinsurers will each pay the
amount listed for each respective company in Schedule A
as their allocated payment of the final payment amount.  The total of these separate payments of the
final payment amount by Reinsurers equals USD 110,000,000, as shown in Schedule A, and no further monies or remuneration of any
type will be paid by Reinsurers as this is a full and final settlement of this
matter.


 


13.          “Severally” or “Several”
shall mean that with respect to the obligations of any Reinsurer, each agrees
only for its own part, and not one for the other, in accordance with its
individual, respective Certificate or several subscription to the Policy as set
forth in Schedule A.


 


14.          “Previous Unallocated
Payments” shall mean the certain payments in the total gross amount of USD
365,000,000 made by various reinsurers, including Reinsurers herein, based on
their respective quota share percentages on an unallocated basis in accordance
with the terms of the Policy and/or Certificates.


 


B.            In consideration of the
agreements contained herein, the Parties agree that:


 


1.             Reinsurers will pay the
final payment amount of the Settlement Amount to Huntsman based on their
respective quota shares as set forth in Schedule A in
settlement of the Settled Claims, the sufficiency as good and valuable
consideration of which is hereby acknowledged. 
The final payment amount of the Settlement Amount shall be paid to
Huntsman by each individual Reinsurer, based on its quota-share percentage, by
check or wire transfer by the earlier of thirty (30) days from the execution of
this Agreement by all Parties or June 30, 2010.  The wire payment instructions are as follows:


 


	
   

  	
  ABA
  No:

  	
  043000261

  
	
   

  	
  Swift
  Code:

  	
  MELNUS3P

  
	
   

  	
  Bank
  Name:

  	
  The
  Bank of New York Mellon

  
	
   

  	
  Address:

  	
  500
  Ross Street, Pittsburgh, PA 15262

  



 


6

















 


	
   

  	
  Beneficiary:

  	
  Huntsman Petrochemical LLC

  
	
   

  	
  Account No:

  	
  126-5975

  
	
   

  	
  Tax ID No:

  	
  58-1594518

  
	
   

  	
   

  	
   

  
	
  Payments
  by check should be sent to the following:

  
	
   

  	
   

  	
   

  
	
   

  	
  Huntsman
  Petrochemical LLC

  
	
   

  	
  Attn:
  Amy Smedley, Esq.

  
	
   

  	
  500
  Huntsman Way

  
	
   

  	
  Salt
  Lake City, UT 84108

  
	
   

  	
  (801)
  584-5700

  
	
   

  	
  Tax
  ID No. 58-1594518

  



 


2.             Huntsman and IRIC agree,
upon execution of this Agreement by all Parties and Huntsman’s receipt of the
final payment amount of the Settlement Amount, to release, remise, covenant not
to sue, and forever discharge the Released Parties irrevocably,
unconditionally, fully, finally and forever of, from and against the Settled
Claims.


 


3.             Because the purpose of this
Agreement is to permanently preclude any further action by Huntsman, IRIC, and
any of their agents, assigns or representatives of any capacity, from pursuing
any further claims relating to the Policy, the Certificates and/or the Loss
against the Released Parties under the subject Policy, Certificates, or
otherwise relating to the Loss, the Federal Actions, and/or the Arbitration,
Huntsman, IRIC, and Reinsurers agree, covenant and warrant that should it
develop that there are any errors or mistakes, whether legal or factual, and
whether mutual or unilateral, that cause this Agreement to be defective, or
that cause the release of any Party hereto to be defective or less than full
and complete as to such matters, then Huntsman, IRIC, and Reinsurers
specifically agree to execute any and all instruments and do any and all things
necessary to effectuate a valid Agreement as set forth above.


 


4.             The obligations of
Reinsurers are several, and not joint, and that no Reinsurer entitled to the
benefits of this Agreement shall be liable for any Settlement Amount allocable
to any other Reinsurer.  Accordingly, each
Reinsurer listed in Schedule A agrees to pay only its individual, respective,
allocated share of the final payment amount of the Settlement Amount.  Huntsman and/or IRIC shall not seek to
recover from any individual Reinsurer an amount in excess of its stated,
respective, allocated share of the final payment amount of the Settlement
Amount.


 


5.             Huntsman and IRIC agree to
indemnify, defend, and hold harmless the Released Parties from and against:


 


a.             Any and all suits, actions,
claims, or demands relating to the Loss (including, but not limited to, claims
in arbitration) of any kind or nature, whether known, unknown, past, existing,
potential, or future, made against Released Parties for the Settled Claims
relating in any way to the Loss, including any and all liens of any nature and
all such claims relating to the Loss, by way of direct action or otherwise,
including without limitation any cross-claims, counter-claims, third-party
claims, or other claims associated with the Federal Actions or Arbitration, made
by, on behalf of, through or under Huntsman and/or IRIC, and/or by any 


 


7

















 


Person or entity who has acquired or been assigned a right by Huntsman
and/or IRIC to make a claim relative to the Loss;


 


b.             Any breach of the
representations, warranties, and acknowledgements in paragraph C below.


 


Huntsman
and IRIC agree, stipulate, and warrant that hereafter the Released Parties
shall be forever free of liability and will be as free of liability for the
Loss as if the Loss under the Policy and/or Certificates had never occurred or
otherwise come into existence.


 


6.             Huntsman, IRIC, and
Reinsurers acknowledge and are aware of the terms of the “Settlement Agreement
and Release” between inter alia,
Huntsman, Hexion Specialty Chemicals, Inc., Nimbus Merger Sub, Inc.,
and certain Apollo entities. 
Specifically, the Parties acknowledge and rely upon paragraph 5(d) of
the “Settlement Agreement and Release” which provides:


 


The claims released pursuant to this paragraph 5 include but are not
limited to all claims, if any, that Hexion and Apollo Releasees may have that
are in any way related to the April 29, 2006 fire at the Port Arthur Base
Chemicals Light Olefins Unit in the Aromatic and Olefins Plant in Port Arthur,
Texas (the “April 29, 2006 Fire”), including claims in connection with: (i) Ace Am. Ins. Co., et al. v. Huntsman Corp. and IRIC, U.S.
District Court Southern District of Texas; Civil Action No. 4:07-CV-02796,
(ii) Huntsman Corp. and IRIC v. Ace Am. Ins. Co., et al.,
U.S. District Court Southern District of Texas, Civil Action No. 4:08-CV-1542,
(iii) any insurance proceeds or other monies received by Huntsman through
the adjustment process, by settlement or otherwise in connection with the April 29,
2006 Fire, or (iv) the adjustment or payment of insurance proceeds in
connection with the April 29, 2006 Fire.


 


C.            In consideration of the
agreements contained herein, Huntsman and IRIC represent, warrant, and
acknowledge that:


 


1.             They have not assigned to
any Person any of their rights under the Policy and/or Certificates with
respect to the Loss, Settled Claims, Federal Actions and/or the Arbitration,
and that there are no other Person(s) who can assert rights to coverage
under the Policy and/or Certificates by, through or under Huntsman and/or IRIC
with respect to the Settled Claims. 
Huntsman and IRIC understand and agree that the Reinsurers have acted in
substantial reliance upon these representations and warrant that there are no
such assignments or other Persons asserting any rights to coverage or benefits
under the Policy and/or Certificates by, through or under Huntsman and/or IRIC
with respect to the Settled Claims. 
Huntsman and IRIC further represent, warrant, and acknowledge that no
liens exist as to the Loss, Settled Claims, Federal Actions, and/or the
Arbitration, and that to the extent any such lien exists or arises, Huntsman
and IRIC will be solely responsible for fully satisfying such lien.


 


2.             This Agreement has been
fully explained to Huntsman and IRIC, and that Huntsman’s and IRIC’s entities
and their representatives understand all of the implications thereof, this
Agreement having been reviewed and expressly approved by their attorneys of
record, and that this Agreement constitutes the sole agreement among the
Parties.  It is further expressly
understood and agreed that this instrument contains the entire agreement
between the Parties, the terms of which are contractual and not a mere recital.


 


8
















 


3.             That Huntsman and/or IRIC is
not now, nor has it been involved in the past, in any bankruptcy proceedings of
any nature that would involve the settlement proceeds herein.


 


4.             That in making this
Agreement, Huntsman and IRIC have had the opportunity to investigate and adjust
the Loss that is the subject of this Agreement, and that to the extent this
Agreement is made prior to completion of the adjustment or arbitration process
or upon information that is or may not be complete, Huntsman and/or IRIC does so
intentionally and voluntarily in order to compromise the disputes and claims at
this time.


 


D.            In consideration of the
agreements herein contained, the Parties agree that:


 


1.             This Agreement is a
compromise between the Parties and shall not be construed as an admission by
any Party, including, but not limited to, any admission concerning coverage
under the Policy and/or Certificates, or any other policy of insurance or
reinsurance certificate, nor shall this Agreement or any provision hereof be
construed as a waiver, modification or retraction of any positions of the
Parties with respect to the interpretation and application of the Policy and/or
Certificates, or any other policies of insurance or reinsurance certificates
that have previously been taken, are being taken, or may be taken in the future
with respect to the Settled Claims.


 


2.             The Federal Actions and
Arbitration, including all claims, defenses, and counterclaims that were
asserted or could have been asserted, shall be finally and forever dismissed
with prejudice as to Huntsman, IRIC, and Reinsurers with respect to each
individual Reinsurer upon the receipt by Huntsman of payment from such
individual Reinsurer of its quota share percentage of the final payment amount
of the Settlement Amount.  The Parties
agree to execute any and all necessary motions, agreed orders, or otherwise, to
facilitate the dismissal with prejudice of all parties named therein.  It is further agreed that all costs and
expenses, including attorney’s fees, related to the Settled Claims, Loss,
Federal Actions, Arbitration, and/or this Agreement incurred before or after
the date of execution of this Agreement shall be paid by the Party incurring
same.  With respect to arbitrators’ fees
and expenses, Huntsman shall pay the fees and expenses for its named
arbitrator, Reinsurers shall pay the fees and expenses for their named
arbitrator, and the Arbitration Parties shall split evenly the fees and
expenses of the Chair of the arbitration panel, such that Huntsman shall pay
50% of the Chair’s fees and expenses and the Reinsurers shall pay 50% of the
Chair’s fees and expenses.


 


3.             If any portion of this
Agreement is declared to be invalid or unenforceable, such portion shall be
deemed severed from this Agreement, and the remaining parts shall remain in
full force and effect as if the invalid or unenforceable portion had not been
part of this Agreement.


 


4.             This Agreement may be
executed in two or more counterparts, all of which shall, upon execution and
delivery of identical counterparts by all Parties, comprise a single
agreement.  Counterpart signatures may be
exchanged by facsimile and/or email and shall be deemed delivered when received
by each of the Parties.


 


5.             The Parties acknowledge and
agree that the payment of the Settlement Amount is a compromise between
Huntsman, IRIC, and Reinsurers, and the adjustment, settlement, and execution
of this Agreement shall have no precedential or binding effect with respect to
the construction of any other policy of insurance or reinsurance certificate
issued or to be issued by Reinsurers. 
The payment described above is for the compromise of disputed 


 


9

















 


claims and it is agreed that by entering into this Agreement, the
Parties intend to avoid further expenses related to the adjustment, litigation,
or arbitration and to buy complete peace.


 


6.             This Agreement is a product
of informed negotiations and involves compromises of the Parties’ previously
stated legal positions.  Accordingly,
this Agreement does not reflect the Parties’ views as to the rights and
obligations with respect to matters or persons outside the scope of this
Agreement.  This Agreement is without
prejudice to positions taken by the Reinsurers with regard to other insureds
and without prejudice to positions taken by Huntsman with regard to other
insurers and reinsurers. Except as herein otherwise provided, the Parties
specifically disavow any intention to create rights in third parties under or
in relation to this Agreement, or to release or otherwise affect any rights
with respect to third parties.


 


7.             The terms of this Full and
Final Settlement, Release, and Indemnity Agreement is not considered
Confidential Information under the terms of the Stipulated Protective Order and
Confidentiality Agreement, signed by Honorable John S. Martin on August 13,
2009.  In addition, upon the execution of
this Agreement by all Parties, the parties agree that Huntsman will issue a
press release with language materially similar to the language contained in
Schedule B hereto.


 


8.             The Parties agree that they
have been represented by counsel in connection with the negotiations leading up
to this Agreement and including the drafting of this Agreement.  The Parties waive any arguments or claims they
might otherwise have that they did not have an opportunity to consult with
counsel regarding the force, effect, and meaning of this Agreement.  The Parties agree that the drafting of this
Agreement has been accomplished by counsel for all Parties, and no party shall
claim that any inferences should be drawn against any other party with respect
to the drafting of this Agreement.


 


9.             This Agreement shall not be
construed as superseding, waiving, modifying, or retracting any of the terms
and conditions of the Settlement Agreement and Arbitration Submission
Agreement, entered into by Huntsman, Reinsurers, Swiss Re and IRIC on December 29,
2008.  Specifically, and without
limitation, the provisions contained in Sections 3, 4, 5, 6, 8 (including
subparts 8.1 through 8.3), 12. 13, 17, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28,
29, 30, 31, 32 and 33 of the December 29, 2008, Settlement Agreement and
Arbitration Submission Agreement shall remain valid and enforceable.


 


10.          The Parties agree that this
Agreement is a complete and final agreement concerning the subject matter
hereof and supersedes all prior agreements and understandings, whether oral or
written, except as otherwise noted in Paragraphs A(11) and D(9) of this
Agreement.


 


11.          With the exception of Max Re
and XL, this Agreement shall be governed and construed in accordance with Texas
law, and any dispute concerning this Agreement shall be venued in Harris
County, Texas and shall be decided by the United States District Court,
Southern District of Texas, Houston Division. 
With respect to Max Re and XL, controlling law and jurisdiction will be
as stated in the facultative reinsurance certificates between IRIC and Max Re
or XL for the 2005-2006 policy year.


 


10

















 


12.          Huntsman, IRIC, and
Reinsurers each represent and warrant that the signatories to this Agreement
have the authority to execute it on behalf of and to bind Huntsman, IRIC, and
Reinsurers respectively.


 


13.          No term in this Agreement
may be changed, waived, discharged, or terminated except by written agreement
signed by Huntsman, IRIC, and Reinsurers.


 


14.          Reinsurers agree that upon
the execution of this Agreement by all Parties and upon Huntsman’s receipt from
each individual Reinsurer of its quota share percentage of the final payment
amount of the Settlement Amount to release, remise, covenant not to sue, and
forever discharge Huntsman and IRIC irrevocably, unconditionally, fully,
finally and forever of, from and against all claims relating to the Loss, the
Federal Actions and/or the Arbitration.


 


15.          Reinsurers represent,
warrant and acknowledge that this Agreement has been fully explained to
Reinsurers, and that Reinsurers’ entities and their representatives understand
all of the implications thereof, this Agreement having been reviewed and
expressly approved by their attorneys of record, and that this Agreement
constitutes the sole agreement among the Parties.  It is further expressly understood and agreed
that this instrument contains the entire agreement between the Parties, the
terms of which are contractual and not a mere recital.


 


16.          Reinsurers represent,
warrant and acknowledge that in making this Agreement, Reinsurers have had the
opportunity to investigate and adjust the Loss that is the subject of this Agreement,
and that to the extent this Agreement is made prior to completion of the
adjustment or arbitration process or upon information that is or may not be
complete, Reinsurers do so intentionally and voluntarily in order to compromise
the disputes and claims at this time.


 


17.          This Agreement shall be
binding upon and inure to the benefit of the Parties and those whose interests
depend on them, including, but not limited to, the parties’ respective
successors, assigns, shareholders or other capital providers, principals,
agents, servants, legal representatives, directors, officers, employees, and
affiliates of any kind.


 


IN
WITNESS WHEREOF the Parties have executed this Agreement by a duly
authorized representative this 14th day
of May, 2010.


 


11

















 


	
  Signed:

  	
  /s/ Sean
  Douglas

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Insured:

  	
  Huntsman
  Corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  Sean
  Douglas

  	
  , its
  duly authorized agent with the express authority to do so.

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Sean
  Douglas

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Vice
  President,  Corporate Development

  	
   

  
	
   

  	
   

  	
   

  
	
  State
  of:

  	
  Utah

  	
   

  	
  County
  of:

  	
  Salt
  Lake

  



 


 


SUBSCRIBED
AND SWORN TO BEFORE ME this 14th day of May, 2010.


 


 


	
   

  	
  /s/
  Michelle Fujinami

  
	
   

  	
  NOTARY
  PUBLIC

  



 


 


MY
COMMISSION EXPIRES:


 


	
  June 8, 2010

  	
   

  	
   

  



 


12

















 


	
  Signed:

  	
  /s/
  John R. Heskett

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Insurer:

  	
  International
  Risk Insurance Company

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  John
  R. Heskett

  	
  , its
  duly authorized agent with the express authority to do so.

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  John
  R. Heskett

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Vice
  President and Treasurer

  	
   

  
	
   

  	
   

  	
   

  
	
  State
  of:

  	
  Utah

  	
   

  	
  County
  of:

  	
  Salt
  Lake

  



 


 


SUBSCRIBED AND SWORN TO BEFORE ME
this 14th day of May, 2010.


 


 


	
   

  	
  /s/
  Michelle Fujinami

  
	
   

  	
  NOTARY
  PUBLIC

  



 


MY
COMMISSION EXPIRES:


 


	
  June 8, 2010

  	
   

  	
   

  



 


13

















 


	
  Signed:

  	
  /s/
  Myles A. Parker

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Reinsurers:

  	
  Ace
  American Insurance Company, Chartis Property Casualty Company f/k/a  AIG Casualty Company f/k/a Birmingham Fire Insurance Company of
  Pennsylvania, Allianz Global Risks US Insurance Company, Arch Reinsurance
  Company of Nebraska, AXIS Specialty Ltd., Limit No. 2, Ltd.,
  Commonwealth Insurance Company, HDI Industrie Versicherung AG, Simon Andrew
  White as Lead Underwriter for Heritage Syndicate 1200 ROC at Lloyd’s, in his
  Individual Capacity (Heritage Syndicate 1200 ROC at Lloyd’s), R. J.
  Kiln & Company, Ltd., Cathedral Underwriting, Ltd., Munich  Reinsurance Company (Mūnchener
  Rūckversicherungs-Gesellschaft AG), Partner Reinsurance Company, Ltd.,
  SCOR UK Company, Ltd., Wurttembergische Versicherung AG, Zurich American
  Insurance Company, and XL Insurance (Bermuda) Ltd.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  Myles
  A. Parker

  	
  , Market
  Counsel, their duly authorized representative with 

  
	
   

  	
  the
  express authority to do so.

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Myles
  A. Parker

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Market
  Counsel

  	
   

  
	
   

  	
   

  	
   

  
	
  State
  of:

  	
  Mississippi

  	
   

  	
  County
  of:

  	
  Hinds

  
						



 


 


SUBSCRIBED AND SWORN TO BEFORE ME
this 14th day of May, 2010.


 


 


	
   

  	
  /s/
  Rayann Craig Dukes

  
	
   

  	
  NOTARY
  PUBLIC

  



 


 


	
  MY
  COMMISSION EXPIRES:

  	
   

  
	
   

  	
   

  
	
  February 1, 2014

  	
   

  



 


14

















 


	
  Signed:

  	
  /s/
  Louis A. Adanio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Reinsurer:

  	
  Max
  Re, Ltd.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  Louis
  A. Adanio

  	
  , their
  duly authorized representative with the express 

  
	
   

  	
  authority
  to do so.

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Louis
  A. Adanio

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  EVP

  	
   

  
	
   

  	
   

  	
   

  
	
  State
  of:

  	
  Bermuda

  	
   

  	
  County
  of:

  	
   

  



 


 


SUBSCRIBED AND SWORN TO BEFORE ME
this 17th day of May, 2010.


 


 


	
   

  	
  /s/ [Illegible]

  
	
   

  	
  NOTARY
  PUBLIC

  



 


MY
COMMISSION EXPIRES:


 


	
  continuous

  	
   

  



 


15
















 


SCHEDULE A - APPORTIONMENT


 


	
  Company, Name, or Syndicate

  	
   

  	
  Percent Share of

  USD $110M

  	
   

  	
  Payment USD

  	
   

  
	
  ACE American Insurance Company

  	
   

  	
  8.0000

  	
  %

  	
  $

  	
  8,800,000

  	
   

  
	
  Chartis Property Casualty Company f/k/a AIG Casualty Company f/k/a
  Birmingham Fire Insurance Company of Pennsylvania

  	
   

  	
  15.0000

  	
  %

  	
  $

  	
  16,500,000

  	
   

  
	
  Allianz Global Risks US Insurance Company

  	
   

  	
  8.0000

  	
  %

  	
  $

  	
  8,800,000

  	
   

  
	
  Arch Reinsurance Company of Nebraska

  	
   

  	
  5.0000

  	
  %

  	
  $

  	
  5,500,000

  	
   

  
	
  AXIS Specialty Limited Bermuda

  	
   

  	
  7.0000

  	
  %

  	
  $

  	
  7,700,000

  	
   

  
	
  Cathedral Underwriting, Ltd. (MMX)

  	
   

  	
  2.2857

  	
  %

  	
  $

  	
  2,514,270

  	
   

  
	
  Commonwealth Insurance Company (Commonwealth of Vancouver)

  	
   

  	
  6.5000

  	
  %

  	
  $

  	
  7,150,000

  	
   

  
	
  HDI Industrie Versicherung AG

  	
   

  	
  3.0000

  	
  %

  	
  $

  	
  3,300,000

  	
   

  
	
  Simon Andrew White as Lead Underwriter for Heritage Syndicate 1200
  ROC at Lloyd’s, in his Individual Capacity (ROC)

  	
   

  	
  9.1429

  	
  %

  	
  $

  	
  10,057,190

  	
   

  
	
  R. J. Kiln & Company, Ltd.

  	
   

  	
  2.2857

  	
  %

  	
  $

  	
  2,514,270

  	
   

  
	
  Limit No. 2, Ltd. (O’Farrell Syndicate)

  	
   

  	
  5.0000

  	
  %

  	
  $

  	
  5,500,000

  	
   

  
	
  Max Re, Ltd.

  	
   

  	
  3.0000

  	
  %

  	
  $

  	
  3,300,000

  	
   

  
	
  Munich Reinsurance Company (Munich American Risk Partners)

  	
   

  	
  9.0000

  	
  %

  	
  $

  	
  9,900,000

  	
   

  
	
  Partner Reinsurance Company, Ltd.

  	
   

  	
  3.2500

  	
  %

  	
  $

  	
  3,575,000

  	
   

  
	
  SCOR UK Company, Ltd.

  	
   

  	
  5.0000

  	
  %

  	
  $

  	
  5,500,000

  	
   

  
	
  Wurttembergische Versicherung AG

  	
   

  	
  2.2857

  	
  %

  	
  $

  	
  2,514,270

  	
   

  
	
  XL Insurance (Bermuda) Ltd.

  	
   

  	
  4.0000

  	
  %

  	
  $

  	
  4,400,000

  	
   

  
	
  Zurich American Insurance Company (Zurich Global Energy)

  	
   

  	
  2.2500

  	
  %

  	
  $

  	
  2,475,000

  	
   

  
	
  Total

  	
   

  	
  100.0000

  	
  %

  	
  $

  	
  110,000,000

  	
   

  



 


















 


Schedule
B


 




	
  

  	
  

  






 




	
  May 14, 2010

  	
   

  	
  CONTACTS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Media:

  
	
   

  	
   

  	
  Gary Chapman, tel: +1 281 719 4324

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Investor Relations:

  
	
   

  	
   

  	
  Kurt Ogden, tel: +1 801 584 5959

  






 


Huntsman to Recover $110 million in Insurance
Settlement Proceeds


 


The
Woodlands, Texas — Huntsman Corporation (NYSE:
HUN) today announced that it has reached agreement with its reinsurance
carriers to settle Huntsman’s claims related to losses occurring as a result of
the April 29, 2006, fire at its Port Arthur, Texas, olefins facility,
subsequently sold to Flint Hills Resources. 
Under the agreement, Huntsman will receive cash proceeds of $110 million
in settlement of its claims, which had been the subject of ongoing arbitration
with its carriers.  Huntsman expects to
receive payment within thirty days following the date of the agreement.  Huntsman previously collected $365 million in
insurance proceeds also related to the 2006 fire.


 


Peter Huntsman, President and CEO of Huntsman, stated, “We are pleased
to have reached this agreement.  As
previously indicated, we plan to use these proceeds to retire secured debt and
further strengthen our balance sheet. 
After doing so with these proceeds, we will have prepaid almost $300
million of secured debt since the beginning of this year.”


 


About Huntsman:


 


Huntsman is a global manufacturer and marketer of
differentiated chemicals.  Its operating
companies manufacture products for a variety of global industries, including
chemicals, plastics, automotive, aviation, textiles, footwear, paints and
coatings, construction, technology, agriculture, health care, detergent,
personal care, furniture, appliances and packaging.  Originally known for pioneering innovations
in packaging and, later, for rapid and integrated growth in petrochemicals,
Huntsman today has approximately 11,000 employees and operates from multiple
locations worldwide.  The Company had
2009 revenues of approximately $8 billion. 
For more information about Huntsman, please visit the Company’s website
at www.huntsman.com.


 

















 


Forward-Looking Statements:


 


Statements in this release that are not historical are forward-looking
statements. These statements are based on management’s current beliefs and
expectations. The forward-looking statements in this release are subject to
uncertainty and changes in circumstances and involve risks and uncertainties
that may affect the company’s operations, markets, products, services, prices
and other factors as discussed in the Huntsman companies’ filings with the U.S.
Securities and Exchange Commission. Significant risks and uncertainties may
relate to, but are not limited to, financial, economic, competitive,
environmental, political, legal, regulatory and technological factors.  In addition, the completion of any transactions described in
this release is subject to a number of uncertainties and closing will be
subject to approvals and other customary conditions. Accordingly, there can be
no assurance that such transactions will be completed or that the company’s expectations will be realized. The company assumes
no obligation to provide revisions to any forward-looking statements should
circumstances change, except as otherwise required by applicable laws.


 


- END -