Exhibit 10(u)

                             INDUCEMENT AGREEMENT
                          WELLMAN OF MISSISSIPPI, INC.

   This Inducement Agreement (the "Agreement") is made and entered into as of
the latest date referenced on the signature pages hereof, by and among the
Mississippi Department of Economic and Community Development ("MDECD") acting
for and on behalf of the State of Mississippi (the "State"), the Mississippi
Business Finance Corporation ("MBFC"), the Mississippi Major Economic Impact
Authority (the "Authority"), the Mississippi Department of Education ("DOE"),
Hancock County, Mississippi (the "County"), Hancock County Tax Assessor (the
"Tax Assessor"), Hancock County Port and Harbor Commission (the "Port
Commission"), Pearl River Community College (the "College") and Wellman of
Mississippi, Inc. (the "Company").

WITNESSETH:

   WHEREAS, the parties hereto wish to set forth their collective commitment
to enter into individual binding agreements concerning the acquisition, by
construction or otherwise, and equipping of a manufacturing facility in the
Port Bienville Industrial Park in Hancock County, Mississippi (the
"Project") and the actions to be taken by the MDECD, the MBFC, the Authority,
DOE, the County, the Tax Assessor, the Port Commission and the College
(collectively, the "Inducers") in support of the development of the Project;
and

   WHEREAS, as used herein, the term "Project" shall be deemed to relate to a
"project" under the Impact Act (as hereinafter defined), as well as all
Facilities Related to the Project (as defined in the Act); and

   WHEREAS, the Project will constitute a "project" as that term is defined
in the Mississippi Major Economic Impact Act, appearing as Section 57-75-1 et
seq., Mississippi Code of 1972, as amended (the "Impact Act"), requiring an
initial capital investment of not less than Three Hundred Million Dollars
($300,000,000); the Project constitutes a manufacturing facility having an
estimated 600,000 square feet under roof;  the Project will be located on an
approximately 488 acre parcel of land (the "Site");  and  approximately 250
people will be employed (as such term is used in Section 5 herein) at the
Project within three (3) years after the Project is completed; and

   WHEREAS, the Company presently expects to expand the Project following its
completion, in two or more additional phases and that the Project, as so
expanded and in full operation,  will result in the employment of
approximately seven hundred (700) people and will require a total capital
investment of approximately One Billion Dollars ($1,000,000,000); and

   WHEREAS, all eligible costs paid or incurred by the Company from and after
February 27, 1996 with respect to the Project shall be deemed to constitute a
portion of the initial capital investment for the Project pursuant to the
Impact Act and the parties acknowledge that all such costs have been made in
reliance upon and in response to the inducements hereinafter described; and
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   WHEREAS, the Site and the improvements thereon to be financed with
proceeds of the Impact Bonds or the County Bonds (both as hereinafter
defined) will be leased by the Port Commission to the Company; and

   WHEREAS, as used in this Agreement, the Company refers to the Company or
any of its existing or future  affiliates, domestic or foreign, and the
Company may, in its sole discretion, assign, including any conveyance, by
lease or sublease, any or all of its interests hereunder or with respect to
the Project to such affiliates; and

   WHEREAS, pursuant to the provisions of the Impact Act, the State,
acting through the State Bond Commission, will agree herein to issue taxable
General Obligation Bonds (the "Impact Bonds") in a principal amount that is
necessary  to provide not less than Thirty-five Million Dollars ($35,000,000)
for the purposes of, inter alia, defraying all or any portion of the
eligible costs incurred with respect to acquisition, planning, design,
construction, installation, rehabilitation, improvement, and relocation of
the Project and any Facility Related to the Project (as that term is defined
in the Impact Act), and costs associated with mitigation of environmental
impacts, all as provided in Section 57-75-15(4) of the Impact Act and  as
hereinafter set forth; and

   WHEREAS, pursuant to the provisions of Section 57-10-401, et seq.,
Mississippi Code of 1972, as amended (the "RED Act"), the MDECD, acting
through the MBFC, will agree herein to issue one or more series of Industrial
Development Revenue Bonds (the "RED Bonds")  in a principal amount  presently
anticipated not to exceed in the aggregate  Four Hundred Million Dollars
($400,000,000) in order to finance a portion of the Project; and

   WHEREAS, the MBFC has determined that the portion of the Project to be
financed with the RED Bonds  constitutes an Economic Development Project, as
that term is defined in the RED Act; and

   WHEREAS, each of the Inducers (i) recognizes that the Company can locate
the Project in other locations, (ii) wants to encourage the Company to locate
the Project in the County for the benefit of the citizens of the State and
the constituents of each of the Inducers, and (iii) enters into this
Agreement in consideration of and as an inducement to the Company to locate
the Project in the County  and in consideration of the economic benefits to
be realized by the parties hereto, including but not limited to, the economic
impact, the increased tax revenues and other benefits to be received by the
Inducers and  the general public; and

   WHEREAS, each of the Inducers recognizes that the Company would not locate
the Project in the County without the inducements  provided herein by each of
them for the entire period for which such inducements are available (pursuant
to existing law, as presently interpreted and construed); and

   WHEREAS, each of  the Inducers will exercise its best efforts to maintain
the inducements provided for herein with respect to each respective Inducer
(in the manner and amounts authorized by existing law, as presently

                                     2
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interpreted and construed) for the entire period referenced herein,
recognizing that the Company has relied upon  such inducements and the
maintenance thereof for such periods in connection with its decision to
locate the Project in the County; and

   WHEREAS, the Inducers and the Company have set forth the obligations each
of them agrees to undertake in connection with the Project in an Inducement
Package,  a copy of which is attached hereto and is hereby incorporated by
reference herein, including all attachments thereto (the "Inducement
Package"), and all terms set forth in the Inducement Package are hereby
approved by all of the parties hereto, as such terms may be applicable to
each respective Inducer; and

   WHEREAS, the agreements contained herein have been the subject of arm's
length negotiations between the Company and each of the Inducers, and each of
the Inducers acknowledges that the obligations set forth herein are the valid
and binding obligations of such party, enforceable against such party in
accordance with the terms hereof.

NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

   Section 1.   Inducers' and Company's Obligations.  Each of the Inducers
hereby agrees that, in consideration of the Company locating the Project in
Hancock County, Mississippi, it will provide the respective inducements or
services to be provided by it as set forth herein, including the obligations
set forth in the Inducement Package.  The Company hereby agrees that, in
consideration of the Inducers providing said inducements or services, it will
locate its Project in Hancock County, Mississippi.

   Section 2.   No Additional Cost to the Company.  The inducements
referenced herein and in the Inducement Package shall be provided for the
express purpose of benefitting the citizens of the State and the constituents
of each of the Inducers, in consideration of the economic benefit to be
realized by the Inducers,  at no additional cost to the Company except as
specifically provided in the Inducement Package.

   Section 3.   Severability.  If any clause, provision or section of this
Agreement be held illegal or invalid by any court, the invalidity of such
clause, provision or section shall not affect any of the remaining clauses,
provisions or sections hereof, and this Agreement shall be construed and
enforced as if such illegal or invalid clause, provision or section had not
been contained herein.  Notwithstanding the above, the parties recognize that
the obligation of the Company to proceed with the construction of the Project
is dependent upon the fulfillment of each element of the Inducement Package
by the Inducers.  If, following the expenditure of the proceeds of the Impact
Bonds as provided herein, the Company fails to proceed with the Project, the
Company will reimburse the MDECD as provided in Section 5 herein. 

   Section 4.   Impact Bonds.  Each Inducer acknowledges that Company
representatives have described the operations that are expected to be
performed at the Site and the improvements and machinery that will be

                                     3
<PAGE>
required to be acquired and constructed on the Site in order to complete the
Project.  The MDECD and the Authority hereby agree,  represent and warrant
that the items specified in the Inducement Package to be financed with the
proceeds of the Impact Bonds constitute lawful applications of such proceeds.

   Section 5.   Remedies for Failure to Perform.  In the event any of the
Inducers or the Company fail to meet any obligation set forth herein for any
reason (subject to force majeure, as provided herein), the Company or
Inducers may proceed against such party, but only against that party, in such
manner as it determines advisable, either at law or in equity, including, but
not limited to, suits for specific performance or damages (excluding
consequential damages).  The Company shall not be obligated to proceed with
the construction of the Project by reason of the failure of one or more of
the Inducers to fulfill any of its or their material obligations under the
Inducement Package, and the Company shall not be liable for any costs or
losses incurred by any other Inducer in its endeavor to fulfill its
obligations under the Inducement Package.  For purposes of this Section 5,
the term "material obligations" shall mean the availability of the proceeds
of the Impact Bonds and the County Bonds and the exercise by the MBFC of all
appropriate procedural requirements in connection with the issuance of the
RED Bonds and the availability of the tax incentives reference in paragraphs
1, 2, 4 and 5 of the "Tax Benefits" section of the Inducement Package and
paragraphs 2 and 5 of the  "Other Tax Benefits" section of the Inducement
Package.

   The Company agrees that if the proceeds of the  Impact Bonds are expended
as set forth in the Inducement Package, the Company will reimburse the MDECD
the following amounts if the Company fails to meet the following standards
and the MDECD demands such reimbursement (or funding as provided in IA
below):

I.   Standards

     A.   If, by the fifth anniversary of the ground breaking for the
Project, there has not been capitalized expenditures of at least Three
Hundred Million Dollars ($300,000,000) with respect to the Project, the
Company will deposit in a trust account an amount equal to the greater of the
difference between (i) Three Hundred Million Dollars ($300,000,000) and the
amount of capital expenditures made with respect to the Project and (ii)
Thirty-five Million Dollars ($35,000,000). The amounts in such account shall
be available for and only for the completion of the Project or additions
thereto in satisfaction of the Company's obligation to make an initial
capital investment of at least Three Hundred Million Dollars ($300,000,000)
for the Project; provided, that if amounts deposited by the Company in such
account are not expended for eligible Project costs within twelve (12) months
of the date such amounts were deposited therein, the Company and the MDECD
agree to negotiate an appropriate amount of time by which such amounts must
be expended with respect to the Project; provided further, that if the MDECD
determines, after good faith negotiations with the Company, taking into
account the factors that led to a delay in the expenditure by the Company,
that no extension is appropriate, either at the end of such twelve (12) month

                                     4
<PAGE>
period or following any agreed upon extension, the Company shall be required
to reimburse to the MDECD (the State) the amounts required pursuant to law,
not to exceed Thirty-five Million Dollars ($35,000,000).  Upon making such
reimbursement,  all amounts remaining on deposit in the trust account shall
be returned to the Company.  In any event, once the Company expends  Three
Hundred Million Dollars ($300,000,000) with respect to the Project, all
amounts on deposit in the trust account shall be promptly repaid to the
Company. 

          If the Company is required to reimburse the MDECD any amounts
pursuant to (A) above, the provisions set forth in (B), (C) and (D) below
shall be automatically and immediately terminated and shall be deemed null
and void.

     B.   If fewer than 150 people are employed at the Project in the First
Measurement Period, the Company will reimburse MDECD $8,000,000.

     C.   If fewer than 150 people are employed at the Project in the Second
Measurement Period, the Company will reimburse MDECD $7,000,000.

     D.   If fewer than 150 people are employed at the Project in the Third
Measurement Period, the Company will reimburse MDECD $6,000,000.

II.   Definitions

   For the purposes of this Section 5:

     A.   A person shall be deemed "employed at the Project" if such person
is compensated (whether by the Company or by or  through a third party, i.e.
contract labor) for more than 1820 hours (calculated on the basis of an
average of 35 hours per week times 52 weeks) at the Site during the
applicable Measurement Period.

     B.   A Measurement Period is defined as a 365-day period.  

     C.   As a general rule the Measurement Periods will be as follows:

          1.   The First Measurement Period will begin when the Project has
reached Production Capacity.

          2.   The Second Measurement Period will commence immediately after
the First Measurement Period is complete.

          3.   The Third Measurement Period will commence immediately after
the Second Measurement Period is complete.

     D.   The following special rules modify the general rules set forth in C
above:

          1.   The Measurement Period is automatically suspended for any
force majeure, which include, but are not limited to, acts of God, shortages

                                     5
<PAGE>
of raw material supplies, equipment breakdown, transportation delays or a
force majeure affecting any customer to whom the Company sells over one
million pounds of product  per year.

          2.   Production Capacity is defined as the date following (i) the
expenditure by the Company of not less than Three Hundred Million Dollars
($300,000,000) (not including the value of any inducements referenced in this
Agreement) at the Site, and (ii) the equipment installed at the Site has an
annual instantaneous production capacity of at least six hundred million
(600,000,000) pounds of first quality product and such equipment has been
producing first quality product for three (3) consecutive months at its
stated capacity.

          3.   If in any one Measurement Period more than 150 people are
employed at the Project, the number of employees in excess of 150 may be
carried either forward or back to another Measurement Period, except that no
more than 85% of the 150 person employment requirement in any Measurement
Period may be satisfied by carryovers.

          4.   Notwithstanding anything herein to the contrary, the Company
shall not be liable for any reimbursement to the MDECD if the MDECD does not
satisfy all of  its obligations under the Inducement Package.

   In the event the Company does not proceed with the Project and the County
or Port Commission has expended amounts with respect to the Project, the only
obligation of the Company to reimburse such entities shall be governed by the
terms of the letter agreement between the Company and the Port Commission,
dated December 21, 1995, a copy of which is attached hereto and incorporated
by reference herein.

   Section 6.   Conditions Precedent.  This Agreement shall not be binding
upon the Company  unless and until the following conditions precedent have
 been met to the satisfaction of the Company:

     a.   The operating contracts referenced in the Inducement Package under
the heading, "Project Operations," have been executed.

     b.   An agreement is executed between the Company and the Tax Assessor
pertaining to the determination of the assessed value of the Project,
depreciation schedules and the identification of the date on which the
Project is complete for purposes of ad valorem taxation.

     c.   The Mississippi State Tax Commission and the Attorney General of
the State of Mississippi each provides a ruling or opinion regarding the
inducements set forth in this Agreement.

     d.   The State Bond Commission authorizes the issuance of the Impact
Bonds, and the use of the investment earnings on the proceeds of the Impact
Bonds for eligible Project costs as described herein.

     e.   The County has met all statutory requirements pertaining to the
issuance of the County Bonds.
                                     6
<PAGE>
     f.   The MBFC has met all statutory requirements pertaining to the
issuance of the RED Bonds.

     g.   An agreement by the applicable Inducers and the Company pertaining
to the  Fee in Lieu of Taxes provided by Section 27-31-104, Mississippi Code
of 1972, as amended.

     h.   Each of the environmental reports, endangered species report,
wetlands report, archeological, cultural and historical report, geotechnical
and topographical report has been submitted to and approved by the Company,
both in terms of form and content.  The Company acknowledges that the County
will not issue the County Bonds and the State will not issue the Impact Bonds
until the Company provides the County and the State with written evidence of
its approval of such reports and its acceptance of the Site.

     i.   The Port Commission and/or the County has entered into a binding
contract for the purchase of the Site and the Remaining Land (as defined in
the Inducement Package) at a price (including closing costs) not in excess of
Two Million Six Hundred Fifty Thousand Dollars ($2,650,000).

     j.   The Company determines that title to the Site is acceptable for the
purposes of completing and operating the Project.

   The Inducers expect to have all of these conditions precedent satisfied by
May 15, 1996.

   Section 7.   Waivers.  The Company, and only the Company, may waive any of
the obligations of one or more of the Inducers set forth in this Agreement. 
No delay or omission to exercise any right or power by any party shall be
construed to be a waiver thereof. In the event any provision contained herein
shall be waived by the Company, such waiver shall not be deemed to waive any
other provision hereunder.  To the extent that any party's performance is
subject to any regulatory or governing body approvals or requires approval by
qualified electors under applicable law, that party or those parties shall
have no obligation to perform and shall not be liable for non-performance,
unless and until such regulatory or governing body approves or authorizes
such performance, or such approval of the qualified electors is obtained; 
provided, however, all parties affected thereby shall use their best
reasonable efforts to secure such approval or authorization.

   Section 8.   Confidentiality.  The Inducers acknowledge that the existence
of this Agreement and the terms hereof are highly confidential and each of
them agrees not to divulge any of such information to any third person unless
such disclosure is approved by the Company or is required by law.  None of
the Inducers will make any public announcement, written or oral, regarding
the Project without the prior written consent of the Company.

   Section 9.   Time is of the Essence.  The Inducers acknowledge that a
delay in the completion of the Project will cost the Company substantial
amounts of money and therefore, time is of the essence as to all terms and
conditions of this Agreement.  It is the intent of the parties that the

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<PAGE>
construction portion of the Project will proceed so that it will be
substantially ready for the installation  of equipment by March 31, 1997,
unless otherwise agreed to by all of the parties.  All parties agree that
they will use good faith in their attempt to have the Project proceed on that
schedule.  The provisions of this Section 9 are subject to acts of God,
including epidemics, landslides, lightning, earthquakes, fires, hurricanes,
tornadoes, storms, floods, washouts and droughts.  All contracts entered into
by any of the Inducers which pertain to the acquisition, by construction or
otherwise, of the Project shall contain clauses satisfactory to the Company
which penalize the other party in the event of late performance.

   Section 10.   Amendments.  Any amendments to this Agreement shall be in
writing and signed by all parties who are affected by such amendment or their
respective successors and assigns.

   Section 11.   Applicable Law, Arbitration and Forum Selection.  This
Agreement shall be governed by the laws of the State of Mississippi
notwithstanding the fact that one or more of the parties to this Agreement
may be or become a resident or a citizen of, or be or become domiciled in, a
different state.  Any and all disputes under or in any way concerning this
Agreement (whether based upon contract, tort or otherwise) or the actions or
failures to act of one or more of the parties in the negotiation,
administration, performance or enforcement  hereof, shall be submitted to
binding arbitration in Hinds County, Mississippi under the rules of the
American Arbitration Association concerning commercial disputes, and the
parties agree to be bound by any decision reached under such rules.  Venue
for any legal action arising from this Agreement, including enforcement of
any arbitration award, shall be in Hinds County, Mississippi.  For purposes
of this Section, the Inducers hereby acknowledge that the Company is managed
and controlled from its corporate headquarters in New Jersey.

   Section 12.   Counterparts.  This Agreement may be executed in two or more
counterparts, each and all of which shall be deemed an original and all of
which together shall constitute but one and the same instrument.

   Section 13.   Headings.  The use of captions and headings in this
Agreement and in the Inducement Package are solely for convenience and shall
have no legal effect in construing the provisions of this Agreement.

   Section 14.   Gender; Number.  Whenever the context of this Agreement
requires, the gender of all words herein shall include the masculine,
feminine and neuter, and the number of all words herein shall include the
singular and plural.

   Section 15.   Successors.  Except for benefits provided pursuant to the
RED Act, all the provisions herein contained shall be binding upon and for
the benefit of the respective successors and assigns of the parties hereto,
to the same extent as if each successor and assign were in each case named as
a party to this Agreement.  RED Act benefits may be assigned by the Company
with the written consent of the  MBFC, provided however, the MBFC agrees that
it will consent to any assignment to a Permitted Transferee as such term is
defined in the Miscellaneous Section of the Inducement Package.
                                     8
<PAGE>
   Section 16.   Entire Agreement.  This Agreement, including the Inducement
Package, constitutes the essential terms of the agreement between the Company
and the Inducers for the purposes stated herein, and no other offers,
agreements, understandings, warranties, or representations exist between the
Company and the Inducers.  The parties intend that the leases, project
operation agreements, tax payment agreements and other agreements to which
reference is made herein and which shall be prepared and executed after the
date of execution of this Agreement  (the "Additional Agreements")  shall
contain the terms and conditions described in this Agreement.  The Company
shall not be required to enter into any agreements other than the Additional
Agreements or to pay amounts in excess of the amounts described herein
pursuant to the Additional Agreements contemplated herein.

   IN WITNESS WHEREOF, the Inducers and the Company have executed this
Agreement on the dates set forth opposite their respective names.

                                   State of Mississippi
                                   By:  Department of Economic
                                        and Community Development

Date:         4-16-96              By:  /s/ James B. Heidel
     ----------------------             --------------------------
                                        Executive Director

                                   Mississippi Business Finance Corporation

Date:         4-16-96              By:  /s/ 
     ----------------------             --------------------------
                                        Executive Director

                                   Mississippi Major Economic Impact
                                    Authority

Date:         4-16-96              By:  /s/ James B. Heidel
     ----------------------             --------------------------
                                        Executive Director

                                   Mississippi Department of Education

Date:         4-16-96              By:  /s/ Nancy Alley
     ----------------------             --------------------------
                                   Title: Director, Industrial Services
                                   Pearl River Community College

                                   Pearl River Community College

Date:         4-16-96              By:  /s/ Ted J. Alexander
     ----------------------             --------------------------
                                        President



                                     9
<PAGE>
                                   Hancock County, Mississippi

Date:         4-16-96              By:  /s/ Phillip Moran
     ----------------------             --------------------------
                                        President, Board of Supervisors

Date:         4-16-96                   Timothy A. Kellar
     ----------------------             --------------------------
(SEAL)                                  Clerk, Board of Supervisors

                                   Hancock County Tax Assessor

Date:         4-16-96              By:  /s/ Edwards 
     ----------------------             --------------------------
                                        President

                                   Hancock County Port and Harbor
                                   Commission

Date:         4-16-96              By:  /s/ David N. McDonald
     ----------------------             --------------------------
                                        Chairman

                                   Wellman of Mississippi, Inc.

Date:         4-17-96              By:  /s/ Keith R. Phillips
     ----------------------             --------------------------
                                   Title:  Treasurer

                                 Guaranty
                                 --------


   Wellman, Inc. hereby guarantees all of the obligations of Wellman of
Mississippi, Inc. under this Inducement Agreement.

                                   Wellman, Inc.

Date:         4-17-96              By:  /s/ Keith R. Phillips
     ----------------------             --------------------------
                                   Title:  Chief Financial Officer










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                       INDUCEMENT PACKAGE*
                    WELLMAN OF MISSISSIPPI, INC.

           , 1996
-----------

MISSISSIPPI MAJOR ECONOMIC IMPACT AUTHORITY BOND FINANCING

The State of Mississippi, acting through the State Bond Commission, will
issue General Obligation Bonds under the Mississippi Major Economic Impact
Act, (appearing as Section 57-75-1 et seq.), in a principal amount of Thirty-
five Million Dollars ($35,000,000), (less the reasonable costs of issuance
pertaining to the Impact  Bonds which are anticipated not to exceed Forty
Thousand Dollars  ($40,000)), shall be segregated in an account specifically
earmarked for costs associated with the Project. The amounts in such account
shall be invested in accordance with applicable law.  The amounts initially
deposited in such account, together with interest earmarked thereon, shall be
utilized to finance the costs associated with each of the following portions
of the Project (as such term is defined in the Impact Act), including costs
associated with engineering and design which are  incurred by the Company
provided such engineering and design costs are specifically related to the
inducements set forth in this Section of the Inducement Package:

     (1)   Site Preparation including, but not limited to, the following: 

          -   clearing, grubbing, cutting, and filling;
          -   topsoil stripping, stockpiling, respreading
               and fine grading;
          -   hydro seeding, swales and landscaping;
          -   storm drainage grading and piping; 
          -   equalization basin and retention pond; and
          -   perimeter fencing around Site and perimeter fencing
               surrounding the manufacturing facilities
          -   cost of mitigation of wetlands (if requested by the Company)

The plans for these site preparation activities will be subject to approval
of the Company in order to ensure that the activities will be carried out in
a manner consistent with the Company's master plan for the Site.

     (2)   Permanent and Construction On-Site Roads and Parking:  In order to
enhance the Site, the State and County will build construction and permanent
roads and parking (gravel, asphalt and concrete) that the Company specifies
it needs on the Site.  Where possible, construction roads and parking will be
combined with roads and parking required for the training center (number 10
below), the  fiber warehouse (number 8 below) and the resin storage facility
(number 3 below).

  *   All statutory references refer to Mississippi Code of 1972, as amended.



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<PAGE>
     (3)   Logistical Support:

          (a)   Through its own rail system, the Port Commission will provide
rail ingress and  egress to and from the Site, on site storage tracks for raw
materials and finished goods and off-site storage (at location mutually
agreeable to Company and Port Commission)  and "wye" tracks at the CSX
interchange ( the cost of the wye  track is expected to be provided by CSX)
for raw materials, intermediate product and finished goods.  In addition to
this rail support, the Port Commission will provide "logistical support
services" including the operation of on-site switching at standard published
rates. 

          (b)   "Logistic support" also includes an on-site resin handling
facility including resin storage silos, on-site rail and truck loading docks
from those silos, resin bagging and storage facilities (which resin bagging
and storage facilities will be approximately 20,000 square feet), all of
which will be located in a facility that is connected to the Company's
manufacturing building via resin conveying pipelines.  The facility and silos
will be designed by the Company.  The resin handling facilities will also be
available for construction storage and offices during the construction of the
Project.

     (4)   Ethylene Glycol Storage Tanks and Delivery System:  Construction
(at location mutually agreeable to Company and Port Commission) of a system
of storage tanks, pumps and a pipeline (which pipeline will be both off-site
and on-site) capable of providing ethylene glycol to the Company's
manufacturing facility from barge delivery.   Port Commission will maintain
industrial barge canal and port to a depth of twelve (12) feet mean sea
level.  The Port Commission will also provide barge dock improvements
pursuant to designs furnished by the Company.  The Company will be
responsible for any environmental damage caused by the Company.

     (5)   Water Tank and Pipe Loop:  At the option of the Company,
construction of a water tank (at location designated by the Company)  and on
-site piping loop to provide the Company with the water it needs for its
processes and the fire protection requested by the Company.  The tank and
piping loop will be designed to the Company's specifications and entire
capacity will be held exclusively for the Company.   In case of  emergency,
 the water tank and pipe loop system will be available to the Port
Commission.

     (6)   Water Well and Tap Fee:  Based upon specifications provided by the
Company, a water well will provide the amount of water requested by the
Company for the Company's processes and fire protection which well will be
constructed at a  location mutually agreed to by the Company and the Port
Commission. Not more than Four Hundred Thousand Dollars ($400,000) of the
Thirty-five Million Dollars ($35,000,000) provided from the proceeds of the
Impact Bonds shall be allocated to this item without the prior written
consent of the Company.  While the Company will pay a fee for the water from
this well, since the cost of construction of the well will be provided from
proceeds of the Impact Bonds, no capital charge or tap fee will be included
in the water fee.  

     (7)   Waste Water Treatment, Connection and Effluent Line:  Construction
(at location mutually agreeable to Company and Port Commission) of wastewater
treatment facility designed to process the Company's wastewater.  Not more
than Seven Million Two Hundred Thousand Dollars ($7,200,000) of the Thirty
-five Million Dollars ($35,000,000) provided from the proceeds of the Impact
Bonds shall be allocated to this item without the prior written consent of
the Company.  The wastewater treatment facility (excluding the effluent
pipeline) may not be used by any other party (except for sanitary wastewater)
without the prior written consent of the Company which consent shall not be
unreasonably withheld; provided, that such consent may be conditioned upon
the Company entering into a mutual indemnity agreement satisfactory to the
Company, which agreement will provide, inter alia, for the indemnification of
the Company for any loss which may result from such use of the wastewater
treatment facility.  The wastewater treatment capital costs include all of
the lift stations and pipelines (both on site and off site) to connect the
Company to the wastewater treatment facility and pumping stations and
pipeline required to take the effluent from the facility to the Pearl River.

     (8)   Fiber Warehouse: Construction of an on-site fiber warehouse
(containing approximately 60,000 square feet) adjacent to the Company's fiber
processing facility to be used  for the Company's  fiber storage and excess
spare parts storage.  The warehouse will also be available for construction
storage and construction offices.  Not more than Two Million Five Hundred
Thousand Dollars ($2,500,000) of the Thirty-five Million Dollars
($35,000,000) provided from the proceeds of the Impact Bonds shall be
allocated to this item without the prior written consent of the Company. 

     (9)   Access Road:  The construction of an additional access road, which
shall meet or exceed the standards for State Aid Road construction and
standards set by the Company, from Ansley Road to Calgon Road (behind the
Company's property and between the Site and the neighboring site).  Not more
than One Million Five Hundred Thousand Dollars ($1,500,000) of the Thirty-
five Million Dollars ($35,000,000) provided from the proceeds of the Impact
Bonds shall be allocated to this item without the prior written consent of
the Company. 

    (10)   Training Center:  Construction of an off-site (at location
mutually agreeable to Company and Port Commission) training center which will
have an estimated 15,000 square feet.  Initially, the training center will be
used for temporary offices for the Company and the construction contractors
and the training center will be held for the exclusive use of the Company and
its employees through start-up of the Project.  After initial start-up of the
Project, the training center will be available for other users, with the
Company to be provided priority during the first three years after start-up
of the Project.   The Company will be subject to standard user fees for the
use of the Training Center.   Not more than One Million Dollars ($1,000,000)
of the Thirty-five Million Dollars ($35,000,000)  provided from the proceeds
of the Impact Bonds shall be allocated to this item without the prior written
consent of the Company.



                                     13
<PAGE>
    (11)   Fire Station:  Construction and equipping of an off-site (at
location mutually agreeable to Company and Port Commission) fire station
(including acquisition of one or more fire trucks) that meets the Company's
requirements.

    (12)   Temporary Offices and Construction Storage Rental: Office trailers
to be provided by the MDECD as needed by the Company during construction.
During the construction period, training center, resin bagging and storage
facility and fiber warehouse will be made available to the Company to use for
temporary offices and construction storage at no charge.

All portions of the Inducement Package to be financed with proceeds of Impact
Bonds  will be in accordance with designs submitted by or on behalf of the
Company.  With respect to the effluent line referenced in paragraph (7)
above, the access road referenced in paragraph (9) above, the training center
referenced in paragraph (10) above and the fire station referenced in
paragraph (11) above, such designs shall not be considered final without the
approval of the Port Commission, which approval will not be unreasonably
withheld or delayed.  The Company shall participate in the award of any
contracts pertaining to the Project and the Company shall be deemed expert in
the selection of the most qualified contractors.  The Company shall have the
right to inspect the Project during each phase of construction in order to
assure compliance with the contract documents and the Company may reject any
work not deemed acceptable by the Company.  If the Company rejects any such
work and, as a result of such rejection, a legal action is brought against
the Port Commission and/or the County, the Company will indemnify and defend
(and pay any judgment resulting in any litigation) the Port Commission and
the County, as appropriate,  in connection with any such legal action. In
such event, the Company shall control the defense in any such action.  This
indemnification shall apply equally to the State and the MDECD in the event
that either is a defendant in such litigation.

With respect to the selection of contractors, vendors, suppliers and other
persons who are to be selected in accordance with public bidding procedures,
the Company may include in the bid specifications, standards which must be
met by all bidders in order to be eligible for consideration.  Prior to the
award of any such contract, the Company shall be given the opportunity to
advise the Port Commission or the County that a bid submitted by an eligible
bidder that is lower than all other bids received for such work is
nevertheless not the best bid (based upon the Company's good faith
determination).  The County or Port Commission shall not accept such bid if
the Company provides the County or Port Commission with detailed calculations
and narrative summary showing that such bid should be rejected, all in
accordance with Section 31-7-13(d).  If, following the submission by the
Company of such calculations and summary, the Port Commission or the County
follows the recommendation of the Company and rejects the lowest bid, the
Company will indemnify, defend and pay any judgment resulting in any
litigation for any loss the Port Commission or the County, as appropriate,
may incur as a result of the rejection of the low bid and the award of such
job to another qualified bidder; provided, that the Company, as the real
party in interest in such case, shall control the defense in any such action.

                                     14
<PAGE>
This indemnification shall apply equally to the State and the MDECD in the
event that either is a defendant in such litigation.

With respect to costs associated with  the Project relating to expenditures
under the Impact Act, the State, the County and the Port Commission will
assist the Company in structuring those purchases so as to incur the least
possible amount of contractors' and/or sales tax.

The proceeds of the Impact Bonds (including investment earnings thereon)
shall be disbursed pursuant to requisitions (in form to be provided to the
Company by the Authority) submitted to the MDECD and approved by the
Executive Director.  Each requisition must be accompanied by a certificate
executed by authorized representatives of the Company and the Port Commission
certifying that the work or item for which payment or reimbursement is
requested is to the signatory's knowledge, satisfactory.  Payment will be
made by or on behalf of the State within ten business days after the
submission of complete requisitions and certificates.  Payments may be made
to the Company, the County, the Port Commission or contractors, as directed
in the requisition.

It is the intention of the parties that the Project shall be financed, in
part, with Thirty-five Million Dollars ($35,000,000) of proceeds under the
Impact Act, together with investment earnings thereon as set forth herein. 
In the event the cost of acquiring, by construction or otherwise,  the items
listed in this Section of the Inducement Package is less, in the aggregate,
than the amount of the proceeds of the Impact Bonds, the amount remaining on
deposit shall be expended to pay for the cost of acquiring, by construction
or otherwise, one or more of the following at the option of the Company:
terephthalic acid unloading facility, terephthalic acid storage tanks,
ethylene glycol rail unloading facility, guard houses, PIA unloading
facility, fire protection pump house, underground utilities for cooling
water, pipe racks and any other improvement designated by the Company which
may lawfully be financed with the proceeds of Impact Bonds, provided,
however, investment earnings on the proceeds of the Impact Bonds shall be
used only with the approval of the Executive Director for any lawful purpose
under the Act within Hancock County, Mississippi.

All amounts reflected as capitalized costs relating to the Project on the
Company's books which are maintained in accordance with Generally Accepted
Accounting Principles will be included in the computation of the initial
capital investment being made with respect to the Project.

Benefits of Impact Act: The parties intend that the Company shall be entitled
to all benefits that are available under the Impact  Act as the same is
presently interpreted and construed (including the rulings provided by the
Mississippi State Tax Commission and the Attorney General of the State of
Mississippi). In the event the Impact Act is amended or construed or
interpreted and such amendment, construction or interpretation  restricts or
limits any of the benefits presently available thereunder, the Company shall
be deemed to be "grand fathered" with respect to such benefits, to the extent
consistent with applicable law.  In the event such amendment, construction or

                                     15
<PAGE>
interpretation  results in the loss by the Company of any benefit which the
Company is entitled to receive thereunder and under this Agreement, the
Inducers shall use their best efforts, including, without limitation,
attempting to persuade the Mississippi Legislature to take actions as will
provide the Company with such additional inducements and  benefits which will
be of substantially equivalent value as such lost benefits. In the event the
Impact Act is amended and such amendment broadens or expands any of the
benefits presently available thereunder, the Company shall be permitted to
take advantage of such additional or increased benefits, to the extent
consistent with applicable law.

To the extent the same is permissible under applicable law, any amounts
expended with respect to the Project in excess of Three Hundred Million
Dollars ($300,000,000)  shall be considered as part of any expansion (in
order to calculate the initial capital investment with respect to an
expansion) for purposes of meeting the standard set forth in Section 
57-75-5(f)(i) (regarding the required expenditure of not less than Three
Hundred Million Dollars  ($300,000,000)).  At the present time, the Company
has not made any determination as to the timing of its long-term expansion
plans.

HANCOCK COUNTY TAX INCREMENT BOND FINANCING

Hancock County, Mississippi, acting by and through its Board of Supervisors,
will issue Tax Increment Bonds (the "County Bonds") in the principal amount
of Five Million Dollars ($5,000,000), the proceeds of which shall be utilized
to pay the reasonable costs of issuance associated with the issuance of the
County Bonds (which amount is anticipated not to exceed Fifty Thousand
Dollars ($50,000)) and to finance the costs associated with the following
portions of the Project:

     (1)   Purchase of Site (approximately 488 acres):  The parties
acknowledge that the approximately 488 acre parcel on which the improvements
will be located (the "Site") is to be purchased by the County or the Port
Commission with the proceeds of the County Bonds.  Part of the Site is being
purchased from a third party as a part of the purchase of a larger parcel of
land.  The parties hereto acknowledge and agree that the true value of the
Site is approximately One Million Eight Hundred Seventy-eight Thousand
Dollars ($1,878,000).  Title to the Site and to all improvements located
thereon which are financed with the proceeds of the Impact Bonds or the
County Bonds shall be held by the Port Commission and the same shall be
leased to the Company for an initial term of twenty (20) years.  The Company
shall pay  rent for the Site at a rate of One Hundred Sixty Thousand  Dollars
($160,000) per year.  The Company shall pay rent for the improvements
located on the Site at a rate of One Dollar ($1.00)  per year.  The Company
shall have an option to purchase the Site and all improvements located
thereon which are financed with the proceeds of the Impact Bonds or the
County Bonds at the end of such twenty (20)  year term for One Thousand
Dollars ($1000).  If the ethylene glycol unloading and transfer system
described in paragraph (4) under the Mississippi Major Economic Impact
Authority Bond Financing Section of this Inducement Package is located off-

                                     16
<PAGE>
site, then the land on which it is located will be leased  to the Company by
the Port Commission for an initial term of twenty (20) years at a rent based
upon the value of the unimproved land.  At the end of such twenty (20) year
term, the Company and the Port Commission will renegotiate the rent payable
with respect to such land based upon appraised value calculated by a mutually
agreed upon appraiser or appaisers.

     (2)   Site Preparation:  including clearing, grubbing, cutting and
filling; topsoil stripping, stockpiling, respreading and fine grading; hydro
seeding, swales and landscaping; storm drainage grading and piping;
equalization basin and retention pond; environmental reports (phase I and all
such additional phases or other work as requested by the Company), endangered
species report, wetlands report, archeological, cultural and historical
report; geotechnical and topographical report.  Plans for all site
improvements will be subject to prior review by and approval of the Company
in order to ensure that the improvements will be consistent with the
Company's master plan for the Site.  If the findings set forth in any of such
reports are deemed unacceptable by the Company, the Company shall have the
right to any one or more of the following:  remediation of such
unsatisfactory condition (at no cost to the Company and without diminution of
proceeds of the Impact Bonds or the County Bonds, except if the Company
approves costs associated with wetlands mitigation); termination of this
Inducement Agreement and any agreements entered into to consummate the terms
hereof (without any obligation by the Company to reimburse MDECD or the
County for amounts expended with respect to the Project, notwithstanding
anything contained in  Section 5 of the Inducement Agreement).  The Company
acknowledges that if the Company is responsible for any violations of any
environmental laws pertaining to the Site, the Company will be responsible
for remediating such condition and the Company will not seek contribution
from the Port Commission or the County, absent evidence that such entity was
responsible, in whole or in part, for such condition.

The Company agrees that it will provide reasonable assistance to the County
with regard to the marketing of the County Bonds.

The County and Port Commission agree that they will advise the Company
regarding any proposed use of all or any portion of the land not included in
the Site which is being purchased from International Paper Company together
with a portion of the Site ( the "Remaining Land") prior to making any
commitment with any person (the "Potential User") in connection with the
disposition or use of the Remaining Land. Upon receipt of such advice, the
Company or such third party as is designated by the Company shall have the
right and option to purchase (or lease, depending upon the nature of the
interest that the Potential User had been offered) that portion of the
Remaining Land which is the subject of such potential disposition, upon
substantially the same terms and conditions and for the same price as that
under consideration with the Potential User, subject to the following
conditions: (i) The Company must show that it reasonably anticipates that
such property will be developed for use (by the Company or by a third party)
in approximately the same amount of time as such property would have been
developed by the Potential User, and (ii) The Company reasonably anticipates

                                     17
<PAGE>
that the use of the Remaining Land by the Company or such third party will
result in a comparable number of jobs as that which could reasonably be
expected to be created by the Potential User.  This option may be assigned
by the Company to such third party.  The County and the Port Commission each
agree that they will not lower any existing standards pertaining to the use
of the Remaining Land or  amend or repeal any restrictive covenants that
pertain to the same without the consent of the Company.

In the event the cost of these items to be financed with the proceeds of the
County Bonds is less than Five Million Dollars ($5,000,000), the County and
Port Commission agree that they will work with the Company to determine
additional uses for such proceeds in connection with the Project, subject to
applicable law, it being the intent of the parties that the County and Port
Authority will contribute Five Million Dollars ($5,000,000) to the cost of
the Project.

MISSISSIPPI BUSINESS FINANCE CORPORATION RURAL ECONOMIC DEVELOPMENT BONDS

The MBFC will issue up to Four Hundred Million Dollars ($400,000,000) of
revenue bonds under Section 57-10-401, et seq. to finance improvements,
machinery and equipment included in the Project.  The items so financed may
be owned by and title may by held by an entity (which may be a foreign
corporation, partnership or other entity) acting as lessor under one or more
leases and the Company will pay or cause to be paid, rent to such lessor
under the  lease.  All benefits that are available for an "approved company"
under the RED Act will be made available for the Company notwithstanding the
existence of such  lease.  Subject to the requirements of applicable law, the
terms of the revenue bonds and the agreements entered into with respect to
the revenue bonds will be subject to negotiations between the Company and the
purchaser thereof.

MISSISSIPPI BUSINESS INVESTMENT ACT BONDS

The State and the County agree that, upon the request of the Company, they
will make available up to Two Million One Hundred Thousand Dollars
($2,100,000) of proceeds of bonds issued pursuant to the Mississippi Business
Investment Act. appearing as Section 57-61-1 et seq. (the "MBIA").  The
amount of MBIA proceeds loaned to the Company will be subject to repayment
with interest at a rate of two percent (2%) per annum and such loan will be
amortized over fifteen years (or such shorter time as requested by the
Company).  This inducement, if not requested by the Company in connection
with the Project, shall be made available in connection with any future
expansions of the Project, provided such funding is available under
applicable law at such time.  For purposes of calculating the number of net
full-time equivalent jobs created by the Project, a job shall be deemed
created if a person is "employed at the Project."  A person shall be deemed
"employed at the Project" if such person is compensated (whether by the
Company or by or through a third party, i.e. contract labor for more than
1820 hours (calculated on the basis of an average of 35 hours per week times
52 weeks) at the Site during a 365-day period.


                                     18 
<PAGE>
TAX BENEFITS

RED Act Benefits: The parties intend that the Company shall be entitled to
all benefits that are available under the RED Act as the same is presently
interpreted and construed.  In the event the RED Act is amended or construed
or interpreted and such amendment, construction or interpretation  restricts
or limits any of the benefits presently available thereunder, the Company
shall be deemed to be "grandfathered" with respect to such benefits, to the
extent consistent with applicable law.  In the event such amendment,
construction or interpretation  results in the loss by the Company of any
benefit which the Company is entitled to receive thereunder and under this
Agreement, the Inducers shall use their best efforts, including, without
limitation, attempting to persuade the Mississippi Legislature to take
actions as will provide the Company with such additional inducements and
benefits which will be of substantially equivalent value as such lost
benefits. In the event the RED Act is amended and such amendment broadens or
expands any of the benefits presently available thereunder, the Company shall
be permitted to take advantage of such additional or increased benefits, to
the extent consistent with applicable law.

     (1)   Dollar for dollar credit against all State corporate income taxes
on the Company for all principal and interest payments and associated fees on
RED Act bonds, subject to statutory limitations.

     (2)   RED Act benefits shall be applicable to the Company and its
successors and assigns (assignment subject to MBFC approval as provided in
Section 15 of the Inducement Agreement).

     (3)   RED Act benefits to be interpreted in accordance with a ruling of
Mississippi State Tax Commission or MBFC provided specifically for the
Project.

     (4)   Purchases made with respect to the Project and the Project itself
are exempt from all State sales tax, subject to applicable law and the rules
and regulations of the Mississippi State Tax Commission.

     (5)   The Company will not take advantage of the ten (10) year ad
valorem tax exemption provided in the RED Act.  Instead, the Company will pay
a Fee in Lieu of Taxes pursuant to the terms and conditions of an agreement
to be entered into between the Company and MDECD as provided for by Section
27-31-104 (the "Fee in Lieu Agreement").  Such Fee in Lieu of Taxes shall be
equal to one-third of the ad valorem levy for the Project, including ad
valorem taxes for school district purposes. The amount paid under the Fee in
Lieu Agreement shall be apportioned between the County and the school
districts in the following manner.  First, an amount shall be apportioned to
the school districts which shall be equal to the school districts' pro rata
share based upon the proportion that the millage imposed for the school
districts by the appropriate levying authority bears to the millage imposed
by such levying authority for all other county or municipal purposes.  The
remaining fee in lieu payment amount (beyond the school tax portion) shall be
retained by the County; provided, however, that it is agreed and understood 

                                     19
<PAGE>
that such retained amount shall be applied in full to pay debt service on the
County Bonds.

          The Company expects the Project to consist of three separate
production lines ("Production Lines"), and the aggregate cost of the Project
will exceed the minimum capital investment required by Section 27-31-104.
The Fee in Lieu Agreement shall include the following provisions:

          (a)  The term of the Fee in Lieu Agreement shall commence on the
First Assessment Date.  For purposes of this Agreement, the term "First
Assessment Date" shall mean the earliest January 1 by which both of the
following events have occurred: (i) The Tax Assessor and the Company have
determined that at least eighty percent (80%) of the real and/or personal
property which is attributable to the first Production Line and subject to ad
valorem assessment is in place and ready to operate, and (ii) the Company has
met the $100,000,000.00 minimum capital investment required by Section 
27-31-104.  (As hereinafter used, the term "First Assessment Year" shall
mean the period beginning with the First Assessment Date, and ending on
December 31 of the same year.)

          (b)  The Company and MDECD further agree that in addition to the
First Assessment Year, the Fee in Lieu Agreement shall also include each of
the four (4) calendar years succeeding the First Assessment Year (the
"Succeeding Assessment Years").  For each Succeeding Assessment Year the
Agreement shall cover all of the real and personal property acquired by the
Company and placed or used in the Project during the prior calendar year.

          (c)  The Company shall pay the Fee in Lieu of Taxes for a term of
ten (10) consecutive years with respect to property subject to the Fee in
Lieu Agreement as described immediately above.  This means that said ten (10)
year period shall commence on the First Assessment Date with respect to
property described in subparagraph (a) above, and on January 1 of each
Succeeding Assessment Year with respect to property described in subparagraph
(b) above.  (For example, if the 80%/$100,000,000 requirements under
subparagraph (a) are met on November 15, 1998, the First Assessment Date will
be January 1, 1999, the First Assessment Year will be the 1999 calendar year,
and the first Succeeding Assessment Year will be calendar year 2000. 
Beginning January 1, 2000, the Company would pay a Fee in Lieu of Taxes for
10 consecutive years with respect to the Project property subject to ad
valorem assessment at January 1, 1999 (the First Assessment Date).  Beginning
January 1, 2001, the Company would pay a Fee in Lieu of Taxes for 10
consecutive years with respect to the property acquired by the Company and
placed or used in the Project during the 1999 calendar year.  The same
approach would be employed for the three remaining Succeeding Assessment
Years).

          Notwithstanding any other provision in this Agreement, it is
understood and agreed that there shall be no ad valorem assessment or payment
of the Fee in Lieu of Taxes with respect to any portion of the Project prior
to the First Assessment Date.  The Tax Assessor hereby acknowledges the
existence and terms of the Fee in Lieu Agreement described herein and agrees

                                     20
<PAGE>
to abide by such terms as they involve or require his acquiescence or
approval.

          With respect to the calculation of the assessed valuation of the
Project, if adequate justification is provided by the Company and subject to
approval by the Mississippi State Tax Commission if required, the Tax
Assessor will enter into an agreement with the Company providing, inter alia,
for an accelerated depreciation schedule for certain personal property based
upon special circumstances pertaining to the Company's manufacturing
processes.  The Tax Assessor also hereby agrees that the initial assessment
of each Production Line (on the Assessment Date) shall not exceed the cost
thereof. 

     (6)   The Company may utilize a job development assessment fee to be
applied by the Company to repayment of debt service on Bonds pursuant to
provisions of Section 57-10-413.  Amount assessed employees shall constitute
a nonrefundable credit against those employees' state individual income tax. 
The Company may take advantage of any amendments made to the job development
assessment portion of the RED Act made by the Mississippi Legislature in the
1996 Legislative Session.

OTHER TAX BENEFITS

     (1)   On a best efforts basis, the Inducers will provide for the
extension of Foreign Trade Zone.  Application to be made by the Port
Commission based upon information to be provided by the Company.

     (2)   County, the Tax Assessor, and MDECD to agree to provide maximum
statutory tax exemptions and fee in lieu of taxes treatment for future
additions and improvements to the Project upon the same basis as such
inducements are provided herein upon proper application of Company for said
exemptions or fee in lieu of taxes treatment pursuant to applicable law, it
being understood that the present Board of Supervisors,  Tax Assessor, or
Executive Director of MDECD may not obligate a future Board of Supervisors,
Tax Assessor, or Executive Director of MDECD; however, said officials who are
a party to this Agreement shall use their best efforts to assure the
availability of maximum exemptions and comparable fee in lieu of taxes
treatment for future additional improvements.  Said exemptions include, but
are not limited to, ad valorem exemptions on real and personal property, raw
materials, work in process, furniture and fixtures, machinery and equipment
(including computer hardware and software), finished goods, and freeport
warehouse exemptions.

     (3)   Income tax credit (to be applied before income tax credit under
RED Act) of $500 per net new full time job created at Project for five (5)
year period (credit applied in years two (2) through six (6), pursuant to
Section 57-73-21).  The credit taken in any one tax year must be limited to
an amount not greater than fifty percent (50%) of the Company's state income
tax liability which is attributable to income derived from operations in the
state for that year.


                                     21
<PAGE>
     (4)   Income tax credit equal to twenty-five percent (25%) applied
(pursuant to the provisions of Section 57-73-25) to qualified training
expenses related to instructors, instructional materials and equipment and
the construction and maintenance of facilities by community college
designated for training purposes.  The credit shall not exceed fifty percent
(50%) of the income tax liability in a tax year and may be carried forward
for the five (5) successive years if the amount allowable as credit exceeds
the income tax liability in a tax year.

     (5)   Upon receipt of complete Company application, appropriate
governing authorities to grant ad valorem tax exemption (not including State
and school taxes) for the maximum statutory term on finished goods
manufactured in state that are held for sale or shipment to other than final
consumers (Section 27-31-7).

     (6)   Upon receipt of complete Company application, appropriate
governing authorities of the Inducers will take all necessary action to
provide a freeport warehouse exemption (ad valorem exemption on goods moving
in interstate commerce through the State) on finished goods (Section
27-31-51) for the life of the Project.

     (7)   Upon receipt of complete Company application, appropriate
governing authorities of the Inducers to grant ad valorem tax exemption (not
including State and school taxes) for the maximum statutory term on all
eligible property, including raw materials and work-in-process inventory
related to the Project (Section 27-31-101).

     (8)   County and State agree that upon receipt of complete Company
application, if same is required by applicable statutes, each of them will
approve and provide any additional tax exemptions and/or credits hereafter
provided by Mississippi law which may be provided by, or subject to the
approval of, the County and State.

     (9)   County Tax Assessor to assess real and personal property based
upon values in accordance with general State guidelines and the pertinent
provisions of Paragraph (5) under "RED Act Benefits" of the "TAX BENEFITS"
section of this Agreement.  Based on life expectancy of certain equipment or
other special factors, use of accelerated depreciation schedules will be
granted.

     (10)   To the extent the same is lawfully available to the Company, the
Company shall be permitted to take full advantage of and the County (and any
other Inducer who is required to approve the same) will approve all  ad
valorem tax exemptions and credits and other tax incentives, including, but
not limited to, the following: (i) national/regional headquarters credit,
(ii) research and development credits (Section 57-73-21(6) ), (iii) port
income handling charge tax credits (Section 27-7-22.9).  If any of the
exemptions or credits listed in this paragraph expire pursuant to statute,
the Company shall be "grandfathered" to the extent permissible under
applicable law.


                                   22
<PAGE>
EMPLOYEE SELECTION/TRAINING ASSISTANCE

The State of Mississippi (the "State"), the Mississippi Employment Security
Commission (the "Commission"), the Mississippi Department of Education (the
"DOE") and Pearl River Community College (the "College") will assist the
Company in the recruiting, pre-screening, pre-employment training, post-
employment training and retraining of Company employees as follows:

   (1)  The State, through the State Department of Education and the College,
will assist the Company in preparing and submitting the overall Training
 Plan.  A Training Memorandum will be prepared annually in a joint effort
between the Company and the College to support the Training Plan.  The
Training Memorandum will outline, on an annual basis, plans and procedures to
be utilized to support and assist the Company in the execution of their
Training Plan.  These documents will be submitted annually prior to the end
of fiscal year.

   (2)  The DOE will cause the Commission to use job descriptions provided by
the Company to recruit and prescreen applicants and refer them to a selection
process and pre-employment training program developed specifically by the
College for the Company.

   (3)  The State, through the State Department of Education and the College,
will provide for profiling jobs selected by the Company and assess applicants
using ACT Work Keys to insure they have the level of basic skills required to
perform the job function being hired by the Company.  The Company and the
College will work in partnership to insure individuals provided are capable
of meeting the job skills required to be hired by the Company.  The College
will design and conduct a pre-employment basic skills enhancement training
program for these individuals (up to one hundred twenty (120) hours per
person).  The pre-employment training may incorporate information on the
nature of the specific job opportunities and the working environment of the
Company.  The individual class size and schedule will be adjusted to meet the
training requirements of the candidates.

   (4)  The State, through the State Department of Education and the College,
after completion of these assessments and pre-employment training, will refer
to the Company the candidates that it believes meets all the requirements for
the specific job descriptions provided by the Company.  The Company will then
make hiring decisions.

   (5)  The State, through the State Department of Education and the College,
with input from the Company, will design a job specific, post-employment
training program for all company personnel employed in process related jobs. 
This may include the preparation of training materials, including the
production of specific training manuals, aids and video tapes specifically
created for the Company's needs.

   (6)  The State, through the State Department of Education and the College,
will provide post-employment and customized on-the-job training for hourly
and salaried employees.  The trainers may, at the Company's option, be

                                     23
<PAGE>
company employees, and, if so, the Company will be reimbursed for the wages
of the trainers up to a maximum of Fifteen Dollars ($15) per hour.  The
number of hours of this post-employment training provided per trainee is not
set,  but will be mutually agreed upon between the College and the Company.
This training phase may include reimbursement for training supplies.   This
post-employment training may also include some technical training at vendor
sites, requested and approved in advance by the College and the Company, for
employees directly involved with process training as well as on-the-job
training, once the Project begins operation.

   (7)  The State, through the State Department of Education and the College,
after start-up of operations, will continue to provide the training services
described in Items 5 and 6 above as equipment and processes are modified and
upgraded and retraining of existing employees is required.

   (8)  The inducements set forth in this Employee Selection/Training
Assistance Section are further set forth in the letter of Dexter Holloway of
the DOE to Mr. Bill Dorsey, dated October 4, 1995, a copy of which is
attached hereto and incorporated by reference herein.

PROJECT OPERATIONS

The Port Bienville Industrial Park will be improved to provide services to
the Company as outlined in this Agreement which are not currently available
at the Park.  The Company will pay the Port Commission for all services
provided to the Company by the Port Commission under one or more  service
contracts that will provide for the reimbursement of the Port Commission for
operational and overhead costs involved with providing the services. The
Company will be required to pay standard fees for such services  exclusive of
any capital costs.  In addition, the Company will be charged a fee for
capital costs incurred by the Port Commission to construct assets that are
used to provide services to the Company except that no capital reimbursement
will be charged to the Company for assets that are funded with proceeds of
the Impact Bonds or the County Bonds as described herein.

The Company shall have the option to enter into operations service contracts
with the Port Commission for the following Project components (list not
exclusive):

     (a)  Rail system
     (b)  Water tank and well systems
     (c)  Waste water treatment plant
     (d)  Training center

Fire Station: The Port Commission and/or the County will have the
responsibility of coordinating the operations of the fire station and the
volunteers operating the same.

Contracts for the services mentioned above will include customary provisions
that will ensure quality service on a continuous basis.  The Company shall be
obligated to provide for the maintenance of and property insurance with

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respect to (1) all portions of the Project which are situated on Site, and
(2) the Ethylene Glycol Storage Tanks and Delivery System described in
paragraph (4) under the Mississippi Major Impact Authority Bond Financing
Section of this Inducement Package.  Except with respect to the Ethylene
Glycol Storage Tanks and Delivery System, the County and/or the Port
Commission, as appropriate, shall be responsible for the maintenance of and
property insurance with respect to all portions of the Project which are
situated off Site.  The parties recognize that the cost of maintaining the
off Site portions of the Project and providing property insurance in
connection therewith shall be charged to the Company and other users thereof
as a component of customary usage fees and/or leasing arrangements.  Each
service contract (excluding any contract relating to the Rail system) will
provide that the Company, if the Company deems it advisable so to do, may use
its own labor force to provide such services, or to require the engagement of
one or more third parties by the Port Commission (with the Company to provide
any required additional payments) for the provision of such services.

Notwithstanding the above provisions of this Project Operations Section, the
Company shall receive an annual credit for the first One Hundred Sixty
Thousand Dollars ($160,000) of services provided under the service contracts
(collectively) during the initial term of the lease pertaining to the Site.

MISCELLANEOUS

The County will use its best efforts to assist Company representatives in
connection with permanent and temporary transfers.

The County and Port Commission will use their best efforts to provide
advantageous financing to be made available to employees of the Company for
relocation expenses and the purchase of homes in Hancock County.

The County and Port Commission will use their best efforts to assist
employees of the Company with respect to placement of children of such
employees in appropriate schools and school programs.

The County and Port Commission will use their best efforts to have programs
adopted or expanded to encourage the relocation of employees to Hancock
County.

The County and Port Commission will use their best efforts to expedite all
permitting and licensing required with respect to the Project.

The Company agrees to provide timely information with respect to designs and
requirements to the County and the Port Commission in order to enable the
County and the Port Commission to perform their respective obligations
hereunder.

In order to provide the Company and its affiliates with the flexibility to
organize their corporate structure to maximize profitability, the Company and
 its affiliates shall have the ability to transfer all or any portion of the
interests in the Company and/or the Project and/or this Agreement (including,

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without limitation, the Inducements referenced herein) to any one or more
entities (foreign or domestic, existing or future) which are controlled by
the Company or its affiliates (a "Permitted Transferee"). Transfer is broadly
defined and includes, without limitation, mergers, liquidations, sales,
leases, subleases, service contracts and contributions to other companies and
any other type of reorganizations.

Given the current philosophy and commitment to the State of Mississippi
exhibited by the Company's ultimate corporate parent, Wellman, Inc.,  all of
the Inducers acknowledge that it is important to the State and the other
Inducers that Wellman, Inc. maintain its current business and growth
philosophies.  A change in such philosophies could jeopardize the benefits
the Inducers expect to derive for the citizens of the State of Mississippi
over the life of the Project.  Therefore, the Inducers desire to provide the
benefits to be obtained by the Company only if there is  no hostile takeover
of Wellman, Inc., which takeover could, among other adverse events, result in
a change of business philosophy, excess debt levels, restructuring, growth
and requests for wage increases. Wellman, Inc. has a Shareholder Rights
Agreement  (the "Plan") which was established in August 1991 (and which has
been amended subsequent to that date and which may be amended in the future),
which causes substantial equity dilution in the event there is an attempt to
acquire Wellman, Inc. on terms not approved by the Board of Directors of
Wellman, Inc.  In order to protect the interests of the Inducers, in the
event the Rights are triggered (i.e., become exercisable under the Plan), the
Company will be required to repay to the Inducers an amount equal to the
value of all of the inducements provided herein. 

It is the intent of the Inducers that the Company should not be liable for
damages or loss by reason of the acceptance of the inducements referenced
herein.  To the extent permitted by applicable law, each of the Inducers
agrees that it will, in good faith, attempt to minimize or eliminate any loss
which the Company may incur by virtue of its execution of this Agreement and/
or the Company's acceptance of any of the inducements provided for herein.
The obligations set forth in this paragraph shall be limited as to each
Inducer solely to the inducements provided by such entity.

















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