Exhibit 10.1
 

 

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SEPARATION AGREEMENT
 

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between

THE DOW CHEMICAL COMPANY

and

BLUE CUBE SPINCO INC.

Dated as of March 26, 2015
 
 

 
 

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TABLE OF CONTENTS
 
ARTICLE I DEFINITIONS
2
 
Section 1.01
Certain Defined Terms
2
 
Section 1.02
Other Defined Terms
15
 
Section 1.03
Interpretation and Rules of Construction
16
       
ARTICLE II SEPARATION AND CONTRIBUTION
17
 
Section 2.01
Transfer of Assets; Assumption of Liabilities
17
 
Section 2.02
Partially Transferred Contracts; Permits
19
 
Section 2.03
Financing Arrangements; Contribution
20
 
Section 2.04
Certain Resignations
21
       
ARTICLE III THE DISTRIBUTION
21
 
Section 3.01
Conditions to the Distribution
21
 
Section 3.02
Form of the Distribution
21
 
Section 3.03
Manner of the Distribution
22
 
Section 3.04
Actions Prior to Distribution
23
       
ARTICLE IV MUTUAL RELEASE; INDEMNIFICATION
24
 
Section 4.01
Mutual Release
24
 
Section 4.02
Indemnification by TDCC
25
 
Section 4.03
Indemnification by Spinco
25
 
Section 4.04
Limitations on Indemnification
25
 
Section 4.05
No Right to Set-Off
25
 
Section 4.06
Notice of Loss; Third-Party Claims
26
 
Section 4.07
Remedies
27
 
Section 4.08
Tax Matters
27
 
Section 4.09
Further Environmental Provisions
27
       
ARTICLE V CERTAIN ADJUSTMENTS
32
 
Section 5.01
Certain Adjustments
32
       
ARTICLE VI CERTAIN OTHER MATTERS
34
 
Section 6.01
Access to Information
34
 
Section 6.02
Privileged Matters
35
 
Section 6.03
Conduct of Excluded Claims
36
 
Section 6.04
Financial Information
37
 
Section 6.05
Retained Names and Marks; Rail Car Marks
37
 
Section 6.06
Insurance Matters
39
 
Section 6.07
Intercompany Accounts and Arrangements
39
 
Section 6.08
Apportionment of Periodic Payments and Receipts
39
 
Section 6.09
Bulk Sales Laws
39
 
Section 6.10
Further Actions
40
       
ARTICLE VII DISCLAIMER
40
 
Section 7.01
Disclaimer
40

 
 
 
 

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Section 7.02
Limitation of Liability
41
       
ARTICLE VIII GENERAL PROVISIONS
41
 
Section 8.01
Survival of Covenants.
41
 
Section 8.02
Expenses
41
 
Section 8.03
Notices
41
 
Section 8.04
Public Announcements
43
 
Section 8.05
Severability
43
 
Section 8.06
Entire Agreement
43
 
Section 8.07
Assignment
43
 
Section 8.08
Amendment
44
 
Section 8.09
Waiver
44
 
Section 8.10
No Third-Party Beneficiaries
44
 
Section 8.11
Specific Performance
44
 
Section 8.12
Governing Law
44
 
Section 8.13
Waiver of Jury Trial
45
 
Section 8.14
Termination
45
 
Section 8.15
Conflict with Another Transaction Document
45
 
Section 8.16
Counterparts
45

 

EXHIBITS
 
A
Employee Matters Agreement
B
Tax Matters Agreement
C
Form of Intellectual Property Assignment Agreement
D
Form of Intellectual Property License Agreement
E
Form of MOD™ 5 Computerized Process Control Software Agreement
F
Form of Operating Systems and Tools License Agreement
G
Form of Trademark License Agreement
H
Form of Umbrella Secrecy Agreement
I
Form of Ground Lease
J
Form of Extended Occupancy Agreement
K
Form of Site Services Agreement
L
Form of Electric Energy Retail Sales Agreement
M
Form of Lease of Electric Generation, Distribution and Interconnection
Facilities
N
Form of Cell Services Agreement
O
Form of Operating Services Agreement
P
Form of General Services Agreement
Q
Form of Planning Agreement
R
Form of Finished 1, 3 DCP Sales Contract (North America)
S
Form of Acetone Sales Contract (North America)
T
Form of Anhydrous Hydrochloric Acid Sales Contract (North America) – Pipeline
U
Form of Anhydrous Hydrochloric Acid Sales Contract (North America) – Rail Car
V
Form of Benzene Sales Contract (Europe/Terneuzen)
W
Form of Caustic Soda Sales Contract (Europe)

 
 
 
ii

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X
Form of Caustic Soda Sales Contract (Latin America) – Pipeline
Y
Form of Caustic Soda Sales Contract (Latin America) – Truck
Z
Form of Caustic Soda Sales Contract (North America)
AA
Form of Cell Effluent Sales Contract (Europe)
BB
Form of Cell Effluent Sales Contract (North America)
CC
Form of Chlorine Sales Contract (Europe)
DD
Form of Chlorine Sales Contract (North America)
EE
Form of Chlorine Sales Contract (North America) – Rail Car
FF
Form of Cumene Heavies Sales Contract (Europe/Terneuzen)
GG
Form of Epichlorohydrin Sales Contract (North America)
HH
Form of Ethylene Sales Contract (Europe/Stade)
II
Term Sheet for Ethylene Sales (North America)
JJ
Form of Crude Hydrogen Sales Contract (North America)
KK
Form of Incremental Chlorine / Cell Effluent (North America)
LL
Form of Methyl Chloride Sales Contract (Europe)
MM
Form of Methyl Chloride Sales Contract (North America)
NN
Form of Methylene Chloride Sales Contract (Europe)
OO
Form of Methylene Chloride Sales Contract (North America)
PP
Form of Perchloroethylene Sales Contract (Europe)
QQ
Form of Perchloroethylene Sales Contract (North America)
RR
Form of Phenol Sales Contract (North America)
SS
Form of Propylene Oxide Epichlorohydrin Sales Contract (Europe)
TT
Form of PO PDC to PerTet Sales Contract (Europe)
UU
Form of PO PDC to PerTet Sales Contract (North America)
VV
Form of Propane Sales Contract (Europe/Terneuzen)
WW
Form of Propylene Sales Contract (Europe/Stade)
XX
Form of Propylene Sales Contract (Europe/Terneuzen)
YY
Form of Propylene Sales Contract (North America)
ZZ
Form of Carbon Tet RCL to PerTet Sales Contract (North America)
AAA
Form of Telone Sales Contract (Europe)
BBB
Form of Trichloroethylene Sales Contract (Europe)
CCC
Form of Vinyl Chloride Monomer Sales Contract (North America)
DDD
Form of Vinylidene Chloride Sales Contract (North America)
EEE
Term Sheet for Contract Manufacturing Agreement – Wuhan, China

 
 
 
iii

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SEPARATION AGREEMENT

SEPARATION AGREEMENT, dated as of March 26, 2015, between THE DOW CHEMICAL
COMPANY, a Delaware corporation (“TDCC”) and BLUE CUBE SPINCO INC., a Delaware
corporation (“Spinco”).

WHEREAS, TDCC, directly and indirectly, is engaged in the Business and its other
businesses;

WHEREAS, Spinco is a newly-formed, wholly-owned direct subsidiary of TDCC;

WHEREAS, upon the terms and subject to the conditions set forth in this
Agreement, TDCC will, pursuant to a series of restructuring transactions,
(a) cause the Transferred Assets and the Transferred JV Interests to be
transferred to Spinco and the other Transferred Subsidiaries; and (b) cause the
Assumed Liabilities to be assumed by Spinco or the other Transferred
Subsidiaries (such transactions, collectively, the “Internal Separation”);

WHEREAS, following the Internal Separation and prior to the Distribution, Spinco
will incur the New Debt;

WHEREAS, TDCC will distribute (the “Distribution”) all of the issued and
outstanding shares of Spinco’s common stock, $0.001 par value per share (“Spinco
Common Stock”) to holders of TDCC’s common stock (“TDCC Stockholders”),
$2.50 par value per share (“TDCC Common Stock”) (a) without consideration on a
pro rata basis (the “One-Step Spin-Off”); (b) by way of an offer to
exchange shares of Spinco Common Stock for outstanding shares of TDCC Common
Stock (the “Exchange Offer”) (followed by any Clean-Up Spin-Off); or (c) a
combination of a One-Step Spin-Off and an Exchange Offer (followed by any
Clean-Up Spin-Off);

WHEREAS, pursuant to the Agreement and Plan of Merger, dated March 26,
2015 (the “Merger Agreement”), among TDCC, Spinco, Olin Corporation, a Virginia
corporation (“Parent”), and Blue Cube Acquisition Corp., a Delaware corporation
(“Merger Sub”), immediately following the Distribution, Merger Sub will merge
with and into Spinco (the “Merger”), and all shares of Spinco Common Stock will
be converted into shares of common stock of Parent, upon the terms and subject
to the conditions of the Merger Agreement;

WHEREAS, the parties hereto adopt this Agreement as a “plan of reorganization”
within the meaning of Section 368(a) of the Code; and

WHEREAS, the parties hereto intend that, for U.S. federal income Tax purposes,
the contribution (as part of the Separation) by TDCC of all of its ownership
interests in a newly-formed Delaware limited liability company and Blue Cube
Holding LLC, a Delaware limited liability company, to Spinco in exchange for
additional Spinco Common Stock, the Spinco Securities (or, as further described
in Section 7.08(e)(ii)(B) of the Merger Agreement, an amount in cash equal to
the Above Basis Amount), and the Special Payment (the “Contribution”) and the
Distribution, taken together, will qualify as a “reorganization” within the
meaning of Section 368(a)(1)(D) of the Code and that the Merger will qualify as
a “reorganization” within the meaning of Section 368(a) of the Code.
 
 
 
 

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NOW, THEREFORE, in consideration of the foregoing premises and the covenants and
agreements contained in this Agreement, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01     Certain Defined Terms.  For purposes of this Agreement:

“Above Basis Amount” means $2,030,000,000, (a) minus the Below Basis Amount; (b)
if the Estimated Working Capital Amount exceeds the Target Working Capital
Amount, plus such excess; and (c) if the Target Working Capital Amount exceeds
the Estimated Working Capital Amount, minus such excess; subject to adjustment
as set forth in Section 2.04(d) of the Merger Agreement.

“Action” means any claim, action, suit, inquiry, proceeding or investigation by
or before any Governmental Authority or arbitral tribunal.

“Affiliate” means, with respect to any specified Person, any other Person that,
directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.

“Agreement” means this Separation Agreement between the parties hereto
(including the Dow Disclosure Letter) and all amendments hereto made in
accordance with the provisions of Section 8.08.

“Assumed HR Liabilities” has the meaning set forth in the Employee Matters
Agreement.

“Assumed Liabilities” means (a) all Liabilities of Dow, to the extent arising
out of, or relating to, the conduct of the Business, the DCP Group, or the
Transferred Assets, in each case on or after the Distribution Date and including
all Post-Distribution Product Liabilities; (b) all Liabilities of Dow to the
extent arising under, or relating to, the Transferred Contracts or the Partially
Transferred Contracts (other than (i) Retained Accounts Payable; and (ii)
Liabilities of Dow resulting from the material breach by Dow prior to the
Distribution Date of any Transferred Contract or Partially Transferred
Contract); (c) all Liabilities of Dow arising from, or relating to, any Action
against Dow or the Business arising from, or relating to, the conduct of the
Business, the DCP Group or the Transferred Assets, in each case, on or after the
Distribution Date; (d) all of the Assumed HR Liabilities; (e) all Spinco
Environmental Liabilities; (f) all Liabilities that are reflected in the Final
Working Capital Statement, whenever arising; (g) all Liabilities arising under
the New Debt; (h) all Liabilities of Dow arising from, or relating to, the Dow
Credit Support Instruments; and (i) all other Liabilities identified on
Schedule 1.01(a), but excluding all Liabilities in respect of indebtedness of
the JV Entity for borrowed money in excess of the applicable amount set forth on
Schedule 1.01(a).
 
 
 
2

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“Below Basis Amount” means $875 million; unless, pursuant to a written notice
delivered to Spinco at least 20 Business Days prior to the anticipated
Distribution Date, TDCC elects to increase or reduce the Below Basis Amount by
the amount specified in such notice after considering in good faith the
estimated adjusted Tax bases of the Transferred Assets and the estimated amount
of Assumed Liabilities; provided, that in no event shall TDCC increase the Below
Basis Amount to more than $1,050 million without the written consent of Parent.

“Business” means, collectively, (a) the Transferred CAV Business; (b) the
Transferred Epoxy Business; (c) the Transferred GCO Business; and (d) solely for
the purposes of this Agreement, the Merger Agreement and the Intellectual
Property License Agreement, the JV Business.

“Business Day” means any day that is not a Saturday, a Sunday or other day on
which banks are required or authorized by Law to be closed in the City of New
York.

“Business Employee” has the meaning set forth in the Employee Matters Agreement.

“Closing Date” shall have the meaning set forth in the Merger Agreement.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Confidentiality Agreement” shall have the meaning set forth in the Merger
Agreement.

“control” (including the terms “controlled by” and “under common control with”),
with respect to the relationship between or among two or more Persons, means the
possession, directly or indirectly, or as trustee, personal representative or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee, personal representative or executor, by contract or otherwise.

“Conveyance Taxes” means any sales, use, transfer, conveyance, ad valorem,
stamp, stamp duty, recording or other similar tax, fee or charge imposed by any
Governmental Authority upon the sale, transfer or assignment of real, personal,
tangible or intangible property or any interest therein pursuant to the
transactions contemplated by this Agreement, or upon the recording of any such
sale, transfer or assignment, together with any interest, additions or penalties
in respect thereof.

“DCP Group” means the Transferred Subsidiaries and, after the transfer of the
Transferred JV Interests to a Parent Entity, the JV Entity.

“Debt Exchange” shall have the meaning set forth in the Merger Agreement.

“Delayed JV Closing Assets” means the assets identified on Schedule 1.01(b).

“Disclosure Letters” shall have the meaning set forth in the Merger Agreement.
 
 
 
3

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“Distribution Date” means the date on which the Distribution is consummated.

“Dow” means, collectively, TDCC and its Subsidiaries.  For the purposes of the
following definitions contained in this Section 1.01, “Dow” shall also include
the JV Entity:  “Assumed Liabilities”, “Dow Environmental Liabilities”,
“Excluded Liabilities” and “Spinco Environmental Liabilities”.

“Dow Credit Support Instruments” means all obligations of a Retained Dow Entity
under any contract, instrument or other commitment, arrangement or other
obligation in existence as of the Distribution Date to the extent relating to
the Business (excluding any Excluded Liabilities) for which such Retained Dow
Entity is or may be liable as guarantor, original tenant, primary obligor,
person required to provide financial support or collateral in any form
whatsoever, or otherwise (including by reason of performance guarantees),
including those obligations arising under the instruments that are set forth on
Schedule 1.01(c), but excluding guarantees or other financial support
obligations in respect of indebtedness for borrowed money (other than
indebtedness of the JV Entity).

“Dow Disclosure Letter” means the confidential letter delivered by TDCC to
Spinco immediately prior to the execution of this Agreement.

“Dow Entity” means TDCC or any of its Subsidiaries.

“Dow Environmental Liabilities” means any Liability to the extent relating to,
or arising out of, (a) any Releases of Hazardous Materials prior to the
Distribution Date (i) by Dow or, during the period of any lease by Dow prior to
the Distribution Date, by any third party, in each case at, in, on or from any
Transferred Leased Real Property, Transferred Facility located thereon,
Transferred Appurtenant Real Property or Leased Rail Car or (ii) by Dow at, in,
on or from any Owned Rail Car; (b) any Releases of Hazardous Materials prior to
the Distribution Date at, in, on or from any Retained Site, JV Real Property or
Transferred Owned Real Property (or any Transferred Facility located on any such
property); (c) any Releases of Hazardous Materials, whether prior to, on or
after the Distribution Date, at any third-party site to which such Hazardous
Materials were sent for treatment or disposal prior to the Distribution Date
from any Retained Site (or any Transferred Facility located thereon), by Dow
from any Transferred Leased Real Property or Transferred Owned Real Property (or
any Transferred Facility located on either such property), Transferred
Appurtenant Real Property or by the JV Entity from any JV Real Property; (d) any
human exposure to Hazardous Materials occurring prior to, on or after the
Distribution Date, to the extent such Hazardous Materials were Released prior to
the Distribution Date, at, in, on or from any Retained Site, JV Real Property or
Transferred Owned Real Property (or any Transferred Facility located on any such
property) or, in connection with Dow’s operation of the Business (or in
connection with a Release, during the period of such operation), at, in, on or
from any Transferred Leased Real Property, Transferred Facility located thereon,
or Transferred Appurtenant Real Property, and any human exposure to any
Hazardous Material occurring prior to, on or after the Distribution Date, to the
extent such Hazardous Materials were included in any product or material sent or
distributed from, prior to the Distribution Date, a Retained Site or Transferred
Owned Real Property (or any Transferred Facility located on either such
property) or by Dow from any Transferred Leased Real Property, Transferred
Facility located thereon, or Transferred Appurtenant Real Property; (e) any
violation of or noncompliance with Environmental Laws or Environmental Permits
occurring or existing prior to the Distribution Date (i) in connection with the
Business or any Tangible Property or Owned Rail Car, (ii) at any Retained Site
or Transferred Owned Real Property (or any Transferred Facility located on
either such property) or (iii) by Dow at any Transferred Leased Real Property,
Transferred Facility located thereon, Transferred Appurtenant Real Property, or
in connection with any Leased Rail Car, including any continuation of any such
violation or noncompliance, for up to one hundred fifty (150) days subsequent to
the Distribution Date, which Spinco discovers within such one hundred fifty
(150) days and notifies TDCC thereof in accordance with Section 4.06 (provided,
that, in no case shall any failure to discover such continuation during such
period affect any Dow responsibility for the period of noncompliance prior to
the Distribution Date); and (f) any Actions based upon any pre-Distribution Date
violation of or pre-Distribution Date Liability under any Environmental Law or
Environmental Permit (whether such violation or Liability was first identified
prior to, on or after the Distribution Date) brought with respect to the
Business, any Tangible Property, Transferred Owned Real Property or Retained
Site (or any Transferred Facility located on either such property) or, with
respect to Dow’s operation of the Business, at any Transferred Leased Real
Property, or any Transferred Facility located thereon.
 
 
 
4

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“Dow JV Interests” means the equity interests in the JV Entity owned, directly
or indirectly, by TDCC as of the date hereof.

“Encumbrance” shall have the meaning set forth in the Merger Agreement.

“Employee Matters Agreement” means the Employee Matters Agreement, dated as of
the date hereof, among TDCC, Spinco and Parent.

“Employee Records” means copies of all records relating to the employment of the
Business Employees, except to the extent such records are prohibited from being
transferred to the DCP Group or a Parent Entity by applicable Law.

“Environmental Law” means any Law, consent decree or judgment, in each case,
relating to (a) pollution or the protection of the environment; or (b) human
exposure to any Hazardous Material.

“Environmental Permit” means any permit, approval, identification number,
registration, exemption or license that the Business is required to possess
pursuant to any applicable Environmental Law.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Exchange Agent” shall have the meaning set forth in the Merger Agreement.

“Excluded Assets” means Dow’s right, title and interest to any assets of Dow
that are not Transferred Assets (other than, for the avoidance of doubt, the
Transferred JV Interests and any rights of a Transferred Subsidiary under a
Transaction Document), including the assets identified on Schedule 1.01(d).
 
 
5

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“Excluded Claim” means all claims related to any Action that Dow has or may have
against third parties in respect of the Business or any of the Transferred
Assets, in each case to the extent such claim is arising from, or relating to,
the conduct of the Business prior to the Distribution Date, including all
Liabilities arising out of and in connection with the Actions identified on
Annex I to Schedule 1.01(d).

“Excluded Liabilities” means all of the Liabilities of Dow that are not Assumed
Liabilities, including all Dow Environmental Liabilities and any Taxes for which
Dow is liable under the Tax Matters Agreement.

“Final Working Capital Statement” means the final and binding statement prepared
pursuant to Schedule 5.01 setting forth the Working Capital Amount.

“Goodwill” means the goodwill of Dow associated with, or attributable to, the
Business.

“Governmental Authority” means any federal, national, foreign, supranational,
state, provincial, local or other government, governmental, regulatory or
administrative authority, agency, commission or any court of competent
jurisdiction.

“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

“Ground Lease” means a Ground Lease (or jurisdictional equivalent) relating to a
Retained Site, to be entered into by a Retained Dow Entity and a Transferred
Subsidiary in substantially the form attached hereto as Exhibit I.

“Group” means the Retained Dow Entities or the DCP Group, as the context
requires.

“Hazardous Material” means (a) petroleum and petroleum products, by-products or
breakdown products, radioactive materials, asbestos-containing materials and
polychlorinated biphenyls; and (b) any other chemicals, materials or substances
defined or regulated as toxic or hazardous or as a contaminant under any
applicable Environmental Law.

“Indemnified Party” means a Dow Indemnified Party or a Spinco Indemnified Party,
as the case may be.

“Indemnifying Party” means TDCC pursuant to Section 4.02 or Spinco pursuant to
Section 4.03, as the case may be.

“Initial Working Capital Statement” means a statement prepared pursuant to
Schedule 5.01 setting forth TDCC’s determination of the Working Capital Amount.

“Intellectual Property” means all rights in the following in any jurisdiction
throughout the world:  (a) patents and patent applications; (b) trademarks,
service marks, trade names, trade dress and Internet domain names, together with
the goodwill associated therewith; (c) copyrights, including copyrights in
computer software; (d) registrations and applications for registration of any of
the foregoing under clauses (a) – (c) of this definition; (e) trade secrets,
including, to the extent the following constitute trade secrets under applicable
Law, know-how, formulae, methods, techniques, processes, and confidential and
proprietary information; and (f) intellectual property rights in inventions.
 
 
6

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“Intellectual Property License Agreement” means the license agreement to be
executed by TDCC, Dow Global Technologies LLC, Union Carbide Corporation, Union
Carbide Chemicals & Plastics Technology LLC and a Transferred Subsidiary,
pursuant to which Retained Dow Entities grant a license to use certain
Intellectual Property of Dow, in substantially the form attached hereto as
Exhibit D.

“Interest Rate” means an interest rate equal to one (1) month LIBOR interest for
the currency invoiced, as fixed by the ICE Benchmark Administration on the last
Business Day of the month preceding the date on which payment was due, plus
five percentage (5%) points, but in no case higher than the maximum rate
permitted by applicable Law.

“JV Business” means the business of the JV Entity.

“JV Entity” means Dow-Mitsui Chlor-Alkali LLC, a Delaware limited liability
company.

“JV LLC Agreement” means the Second Amended and Restated Limited Liability
Company Agreement of Dow-Mitsui Chlor-Alkali LLC, dated as of March 29, 2011,
between TDCC and the JV Partner.

“JV Partner” means Mitsui & Co. Texas Chlor-Alkali, Inc., a Delaware
corporation.

“JV Real Property” means the real property owned or leased by the JV Entity.

“JV Transfer Requirement” means, (a) with respect to the Transferred JV
Interests, all consents of or approvals or waivers by all applicable third
parties and Governmental Authorities (including the expiry or termination of any
applicable waiting period, and any extension thereof) and any similar
requirements for the transfer of the Transferred JV Interests to a Transferred
Subsidiary or a Parent Entity; and (b) (i) the JV Guarantee Release (as defined
in the Merger Agreement); or (ii) the waiver by TDCC (in its sole and absolute
discretion) of the JV Guarantee Release.

“Law” means any federal, national, foreign, supranational, state, provincial or
local statute, law, ordinance, regulation, rule, code, order, requirement or
rule of law (including common law).

“Leased Rail Cars” means the rail cars leased by Dow and identified on
Schedule 1.01(e).

“Liabilities” means any and all debts, liabilities and obligations, whether
accrued or unaccrued, fixed or variable, known or unknown, absolute or
contingent, matured or unmatured or determined or determinable, including those
arising under any Law, Action or Governmental Order and those arising under any
contract, lease, agreement, arrangement, commitment or undertaking.
 
 
7

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“Local Conveyances” means the asset transfer agreements, share transfer
agreements, bills of sale, deeds, assignment and assumption agreements and other
documents between a Retained Dow Entity, on the one hand, and one or more
Transferred Subsidiaries, on the other hand, pursuant to which (i) Transferred
Assets, Transferred JV Interests and Assumed Liabilities will be transferred to,
or assumed by, the relevant Transferred Subsidiary; and (ii) Excluded Assets and
Excluded Liabilities will be retained, transferred to, or assumed by, the
relevant Retained Dow Entity.

“Neutral Accountant” means Grant Thornton LLP (or another recognized firm with
expertise in accounting matters reasonably acceptable to TDCC and Parent).

“Objection Deadline Date” means the date that is 45 days after delivery by TDCC
to Spinco of the Initial Working Capital Statement.

“Owned Rail Cars” means the rail cars identified on Schedule 1.01(f).

“Parent Entity” means any of Parent or any of its Affiliates, and at or after
the Distribution, the DCP Group, or any Affiliate of a member of the DCP Group.

“Partially Transferred Contracts” means, to the extent they relate to the
Business, all contracts, commitments and other agreements (other than the
Excluded Assets identified on Schedule 1.01(d)) (a) to which a Dow Entity is a
party; and (b) that relate both to the Business and to one or more other
businesses of Dow, including the contracts, commitments and other agreements
identified on Schedule 1.01(g).

“Partner JV Interests” means the equity interests in the JV Entity owned,
directly or indirectly, by the JV Partner as of immediately prior to the date
hereof.

“Person” means any individual, partnership, firm, corporation, limited liability
company, association, trust, unincorporated organization or other entity, as
well as any syndicate or group that would be deemed to be a person under
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.

“Post-Distribution Product Liabilities” means any Liability relating to, or
arising out of, the products or inventory of the Business or the Parent
Entities, including such products’ and inventories’ manufacture, design,
development, testing, importation, distribution, delivery, transport, storage,
ownership, possession, marketing, labeling, packaging, sale, purchase,
consignment or leasing, in each case, to the extent manufactured, sold or
distributed on or after the Distribution Date.

“Pre-Distribution Date Period” means any taxable period ending prior to the
Distribution Date.

“Record Date” means the time and date to be determined by the TDCC Board as the
record date for determining TDCC Stockholders entitled to receive shares of
Spinco Common Stock in the Distribution, to the extent the Distribution is
effected through a One-Step Spin-Off, or in connection with any Clean-Up
Spin-Off.

 
8

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“Record Holders” means the TDCC Stockholders of record on the Record Date
(excluding treasury shares held by TDCC and any shares of TDCC Common Stock
otherwise held by a Dow Entity).

“Registered” means issued by, registered or filed with, renewed by or the
subject of a pending application before any Governmental Authority or Internet
domain name registrar.

“Release” means disposing, discharging, injecting, spilling, leaking, pumping,
pouring, leaching, dumping, emitting, escaping or emptying into or upon, from,
or migrating through, within or into, the air or any soil, sediment, subsurface
strata, surface water or groundwater, natural resources or structure.

“Remedial Action” means any action required to investigate, clean up, remove or
remediate, or conduct remedial, responsive, monitoring or corrective actions
with respect to, any presence or Release of Hazardous Materials.

“Representatives” means with respect to any Person, such Person’s Affiliates and
its and their respective directors, officers, employees, agents and advisors.

“Retained Dow Entity” means any Dow Entity that is neither a JV Entity nor a
Transferred Subsidiary.

“Retained Sites” means the land underlying certain of the Transferred Facilities
and identified on Schedule 1.01(h), which land will, from and after the
Distribution, be leased by a Retained Dow Entity to a Parent Entity pursuant to
a Ground Lease or jurisdictional equivalent.

“SEC” means the United States Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Separation” means, together, the Contribution, the receipt of the Spinco
Consideration, and the Distribution.

“Special Payment” means an amount equal to the Below Basis Amount.

“Spinco Commitment Letter” shall have the meaning set forth in the Merger
Agreement.

 
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“Spinco Environmental Liabilities” means any Liability to the extent relating
to, or arising out of, (a) any Releases of Hazardous Materials first occurring
on or after the Distribution Date (i) at, in, on or from any Transferred Owned
Real Property (or any Transferred Facility located thereon) or (ii) by a Parent
Entity (or any of its successors or assigns) at, in, on or from any Retained
Site or Transferred Owned Real Property (or any Transferred Facility located
thereon) or Owned Rail Car; (b) any Releases of Hazardous Materials first
occurring on or after the Distribution Date (i) by a Parent Entity or, during
the period of any lease by a Parent Entity after the Distribution Date, by any
third party, in each case at, in, on or from any Transferred Leased Real
Property, Transferred Facility located thereon, Transferred Appurtenant Real
Property or Leased Rail Car or (ii) by the JV Entity at, in, on or from the JV
Real Property; (c) any Releases of Hazardous Materials on or after the
Distribution Date at any third-party site to which such Hazardous Materials were
sent for treatment or disposal on or after the Distribution Date (i) by a Parent
Entity (or any of its successors or assigns) from any Transferred Leased Real
Property, Transferred Owned Real Property, any Retained Site (or any Transferred
Facility located on any such property), or Transferred Appurtenant Real Property
or (ii) by the JV Entity from any JV Real Property; (d) any human exposure to
Hazardous Materials first occurring on or after the Distribution Date, but only
to the extent such Hazardous Materials were first Released on or after the
Distribution Date, at any Transferred Owned Real Property, or any Transferred
Facility located thereon or, in connection with a Parent Entity’s (or any of its
successors or assigns) operations thereon, at any Retained Site or any
Transferred Facility located thereon, any Transferred Leased Real Property or
any Transferred Appurtenant Real Property or, in connection with the JV Entity’s
operation thereon, at the JV Real Property, and any human exposure to any
Hazardous Material included in any product manufactured at, or material sent or
distributed from, on or after the Distribution Date, (i) any Transferred Leased
Real Property or Transferred Owned Real Property, or any Transferred Facility
located on either such property; or (ii) by a Parent Entity (or any of its
successors or assigns) from any Retained Site or any Transferred Facility
located thereon, or any Transferred Appurtenant Real Property; (e) any violation
of or noncompliance with Environmental Laws or Environmental Permits occurring
on or after the Distribution Date (i) in connection with the Business or any
Tangible Property or Transferred Owned Real Property (or any Transferred
Facility located thereon), (ii) by a Parent Entity (or any of its successors or
assigns) at any Retained Site or any Transferred Facility located thereon, any
Transferred Leased Real Property or any Transferred Appurtenant Real Property or
(iii) by a Parent Entity (or any of its successors or assigns) in connection
with any Leased Rail Car or Owned Rail Car; and (f) any Actions based upon any
post-Distribution Date violation of or post-Distribution Date Liability under
any Environmental Law or Environmental Permit brought with respect to any
Transferred Owned Real Property, or any Transferred Facility located on either
such property, or, with respect to a Parent Entity’s (or any of such entity’s
successors or assigns) operations thereon, at any Retained Site or any
Transferred Facility located thereon, any Transferred Leased Real Property or
any Transferred Appurtenant Real Property, in each of clauses (a) through (e),
except for any Dow Environmental Liabilities or any post-Distribution Date
environmental obligation specifically imposed on Dow in any of the Transaction
Documents; provided, that notwithstanding anything to the contrary in this
Agreement, under no circumstances shall the Spinco Environmental Liabilities
include, or shall any Parent Entity otherwise have any obligation hereunder with
respect to, any Liability relating to, or arising out of, any Releases of
Hazardous Materials, human exposure to Hazardous Materials, or violation or
noncompliance with Environmental Laws or Environmental Permits, in each case,
at, in, on or from any Retained Site, or any Transferred Facility located
thereon, and first occurring after the date that any Parent Entity’s right to
use and occupy the Transferred Facility, including under the terms and
conditions of any Ground Lease, terminates and after such Parent Entity has
ceased using or occupying such Transferred Facility.

 
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“Spinco Financial Statements” shall have the meaning set forth in the Merger
Agreement.

“Spinco Securities” means notes or, at the option of TDCC, loans issued by (or
incurred by, as the case may be) Spinco to TDCC in a principal face amount equal
to the Above Basis Amount (subject to gross up to account for applicable
underwriting or other fees that are customary for similar transactions), in
accordance with Section 2.03(c)(ii), which notes or loans, as the case may be,
shall (unless otherwise agreed by TDCC and Parent): (a) be unconditionally
guaranteed, after consummation of the Merger, by Parent; (b) have a maturity
date of at least eight (8) years and be non-callable and not prepayable for a
period of five (5) years and thereafter shall be callable or prepayable on terms
customary for the applicable instrument (including, for the avoidance of doubt,
at declining premium above principal face amount); (c) have an interest rate
(payable only in cash and not in kind) and commensurate with the then-prevailing
market interest rate for companies of comparable creditworthiness, but in any
event the total per annum interest rate on the Spinco Securities shall not
exceed the Total Cap; (d) have customary covenants and other terms for
comparable debt securities (or loans, as the case may be) in light of
then-prevailing market conditions for issuers and borrowers of comparable
creditworthiness; (e) include a basket permitting Parent to continue to declare
and pay its regular quarterly dividend; and (f) otherwise be (x) in the case of
notes, in form and substance, and subject to an indenture, customary for senior
unsecured debt offerings made under Rule 144A under the Securities Act; or (y)
in the case of loans, in form and substance, and subject to a credit agreement,
customary for senior unsecured term loan facilities, as the case may be.

“Subsidiary” of any Person means any corporation, partnership, limited liability
company or other organization, whether incorporated or unincorporated, which is
controlled by such Person.

“Tag Event” means the exercise by the JV Partner of its right to accept the Dow
Offer (as defined in the JV LLC Agreement) pursuant to Section 7.10(c) of the JV
LLC Agreement.

“Tangible Property” means (i) the tangible machinery, equipment, infrastructure,
vehicles, wires and other tangible property that is owned, leased or licensed by
Dow and primarily related to the Business and, in the case of tangible property
owned, leased or licensed by Dow and primarily used by the Business at the
Transferred Leased Real Property, at the Transferred Owned Real Property or at
the Transferred Facilities, fixtures, in each case, excluding real property
(other than fixtures); and (ii) the assets identified on Schedule 1.01(i).

“Target Working Capital Amount” means $203,900,000.

“Tax” or “Taxes” means all income, capital gain, gross receipts, windfall
profits, severance, property, production, license, excise, net worth, franchise,
capital, employment, withholding, social security contributions and other taxes,
duties, fees, charges or imposts, however denominated, together with any
interest, additions or penalties in respect thereof, imposed by any Taxing
Authority (but excluding any Conveyance Taxes).

 
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“Tax Matters Agreement” means the Tax Matters Agreement, dated as of the date
hereof, among TDCC, Spinco and Parent.

“Taxing Authority” means any Governmental Authority that is responsible for the
administration or imposition of any Tax or Conveyance Tax, including any
federal, national, international, supranational, state, provincial, local or
other government, governmental, regulatory or administrative authority, agency
or commission and any court, tribunal or judicial or arbitral body empowered to
issue binding decisions.

“TDCC Board” means the Board of Directors of TDCC.

“Trademark License Agreement” means the license agreement to be executed by TDCC
and a Transferred Subsidiary, pursuant to which TDCC grants a license to use
certain trademarks of Dow, in substantially the form attached hereto as
Exhibit G.

“Transaction Documents” means this Agreement, the Merger Agreement, the Local
Conveyances and each of the documents identified on Schedule 1.01(j).

“Transferred Accounts Receivable” means all accounts receivable arising in
connection with the conduct of the Business, that are transferred to a
Transferred Subsidiary or Parent Entity on or prior to the Distribution Date.

“Transferred Appurtenant Real Property” means, with respect to the Transferred
Leased Real Property, the Transferred Owned Real Property or the Transferred
Facilities, all of the easements, rights-of-way, servitudes and similar rights
(or any applicable portion thereof) including with respect to facilities,
equipment and other infrastructure used in the production, processing or
movement of brine, in each case that are primarily related to, or material to,
the operation of the Business and related to such Transferred Leased Real
Property, Transferred Owned Real Property or Transferred Facilities.

“Transferred Assets” means, subject to Section 2.01(d), all of Dow’s right,
title and interest in and to the following assets:  (a) the Transferred Leased
Real Property, the Transferred Owned Real Property, the Transferred Facilities,
the Transferred Appurtenant Real Property and the leasehold estate in and to the
Retained Sites; (b) the Transferred Intellectual Property; (c) the Tangible
Property; (d) the Owned Rail Cars; (e) the Transferred Inventory; (f) the
Transferred Contracts and the Partially Transferred Contracts; (g) the
Transferred Accounts Receivable; (h) the Transferred Permits; (i) the
Transferred Records; (j) the Transferred Information; (k) the Goodwill; (l) any
assets that transfer to the Parent, the Transferred Subsidiaries or any of their
Affiliates pursuant to the Employee Matters Agreement; and (m) all other assets
and properties reflected on the Final Working Capital Statement, in the case of
each of clauses (a) – (l) above, excluding the Excluded Assets identified on
Schedule 1.01(d).

“Transferred CAV Business” means the chlor-alkali and chlor-vinyl business as
operated at or in respect of the Transferred Facilities located at Freeport,
Texas; Plaquemine, Louisiana; and Russellville, Arkansas (which business
produces chlorine, caustic soda, ethylene dichloride, vinyl chloride monomer
and, solely to the extent they are byproducts from the production of the
foregoing products, hydrochloric acid and hydrogen), and the development,
production, distribution, marketing, research into, and sale of such products,
in each case, as conducted by a Dow Entity and excluding any Excluded Assets
identified on Schedule 1.01(d).

 
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“Transferred Contracts” means all contracts, commitments, leases and other
agreements (other than the Excluded Assets identified on Schedule 1.01(d)) to
which a Dow Entity is a party and that relate primarily to the Business,
including the contracts, commitments, leases and other agreements identified on
Schedule 1.01(k).

“Transferred Epoxy Business” means the epoxy business as operated at, or in
respect of, the Transferred Facilities located at Baltringen, Germany; Freeport,
Texas; Gumi, South Korea; Guarujá, Brazil; Pisticci, Italy; Roberta, Georgia;
Rheinmünster, Germany; Stade, Germany; Terneuzen, the Netherlands; and
Zhangjiagang, China (which business produces acetone, cumene, phenol, allyl
chloride, epichlorohydrin, bisphenol A, novolac resins, liquid epoxy resins,
advanced epoxy resins, epoxy novolac resins, and amine and polyphenolic
hardeners for epoxy resins), and the development, production, distribution,
marketing, research into, and sale of such products, in each case, as conducted
by a Dow Entity and excluding any Excluded Assets identified on Schedule
1.01(d).

“Transferred Facilities” means the facilities, buildings, structures and other
improvements that are (a) located at the Transferred Sites and at the Retained
Sites; and (b) identified on Schedule 1.01(l).

“Transferred GCO Business” means the chlorinated organics business as operated
at, or in respect of, the Transferred Facilities located at Freeport, Texas;
Plaquemine, Louisiana; and Stade, Germany (which business produces
perchloroethylene, trichloroethylene, vinylidene chloride, methyl chloride,
methylene chloride, carbon tetrachloride, 1,1,2-trichloroethane,
trichloromethane, 1,1,2,3-tetrachloropropylene, 1,1,3,3-tetrachloropropylene and
other chlorinated propanes and propylenes used as hydrofluoro-olefins (4th
generation) refrigerant feedstocks, in each case, with or without stabilizers
added), and the development, production, distribution, marketing, research into,
and sale of such products, in each case, as conducted by a Dow Entity and
excluding any Excluded Assets identified on Schedule 1.01(d).

“Transferred Information” means sales and promotional literature, customer lists
and other sales-related materials, in each case, to the extent used or held for
use in the Business and in the possession of Dow; provided, that TDCC may redact
any information not related to the Business and, subject to Section 7.14 of the
Merger Agreement, may retain a copy of any Transferred Information.

“Transferred Intellectual Property” means all Intellectual Property owned by Dow
that is exclusively related to the Business, including the Registered
Intellectual Property identified on Schedule 1.01(m).

 
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“Transferred Inventory” means the inventories of raw materials, packaging
materials, semi-finished and finished goods, purchased supplies, other supplies
and spare parts and materials used for maintaining production machinery and
equipment, in each case, (a) to the extent such inventories are held by Dow for
use in the Business; and (b) other than with respect to spare parts and
materials used for maintaining production machinery and equipment, to the extent
such inventories are transferred to a Transferred Subsidiary on or prior to the
Distribution Date.

“Transferred JV Interests” means the Dow JV Interests; provided, that if there
is a Tag Event prior to the Distribution Date, “Transferred JV Interests” means,
collectively, the Dow JV Interests and the Partner JV Interests.

“Transferred Leased Real Property” means the real property leased by a Dow
Entity, as tenant, under the agreements identified on Schedule 1.01(n).

“Transferred Owned Real Property” means the real property identified on
Schedule 1.01(o).

“Transferred Permits” means the Environmental Permits and all other permits,
licenses, agreements and authorizations issued or granted by any Governmental
Authority, including any pending applications therefor, to the extent used or
held for use exclusively in connection with the Business.

“Transferred Records” means all books of account, financial records, invoices,
shipping records, supplier lists, Tax records or copies thereof to the extent
they relate exclusively to the Transferred Subsidiaries or the JV Entity, minute
books, stock ledgers, correspondence and other documents, records and files, to
the extent related to the Business, the Transferred Subsidiaries or the JV
Entity, and the Employee Records; provided, that TDCC may redact information not
related to the Business from the Transferred Records prior to the delivery of
the Transferred Records to a Transferred Subsidiary and, subject to
Section 7.14 of the Merger Agreement, may retain a copy of any Transferred
Records.

“Transferred Sites” means the Transferred Owned Real Property and Transferred
Leased Real Property that are identified on Schedule 1.01(p).

“Transferred Subsidiaries” means each of Spinco, the limited liability companies
that TDCC will contribute to Spinco pursuant to this Agreement and their
respective Subsidiaries, excluding the JV Entity.

“Unresolved Objections” means the objections set forth in the Notice of
Disagreement delivered to TDCC pursuant to Section 5.01(d) that remain
unresolved pursuant to Section 5.01(e)(iii).

“Working Capital Amount” means the amount determined in accordance with
Schedule 5.01 as of close of business on the day immediately prior to the
Distribution Date.

 
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Section 1.02     Other Defined Terms.  The following terms have the meanings set
forth in the Sections set forth below:
 
Defined Term
Location of Definition
   
Clean-Up
Spin-Off                                                                                            
§ 3.02(c)
Contribution                                                                                            
Recitals
Delayed JV
Closing                                                                                            
§ 2.01(e)
Delayed JV Closing
Date                                                                                            
§ 2.01(e)
Disputed
Items                                                                                            
§ 5.01(d)
Distribution                                                                                            
Recitals
Dow Indemnified
Party                                                                                            
§ 4.03
Environmental
Deminimis                                                                                            
§ 4.09(e)
Environmental
Losses                                                                                            
§ 4.09(d)
Estimated Working Capital
Amount                                                                                            
§ 5.01(a)
Exchange
Offer                                                                                            
Recitals
Existing
Stock                                                                                            
§ 6.05(b)
Internal
Separation                                                                                            
Recitals
Losses                                                                                            
§ 4.02
Merger                                                                                            
Recitals
Merger
Agreement                                                                                            
Recitals
Merger
Sub                                                                                            
Recitals
New
Debt                                                                                            
§ 2.03(a)
Notice of
Acceptance                                                                                            
§ 5.01(d)
Notice of
Disagreement                                                                                            
§ 5.01(d)
One-Step
Spin-Off                                                                                            
Recitals
Overpayment                                                                                            
§ 5.01(f)(ii)
Parent                                                                                            
Recitals
Rail Car
Marks                                                                                            
§ 6.05(f)
Releasees                                                                                            
§ 4.01(a)
Retained Accounts
Payable                                                                                            
Schedule 5.01
Retained Names and
Marks                                                                                            
§ 6.05(a)
Spinco                                                                                            
Preamble
Spinco Common
Stock                                                                                            
Recitals
Spinco
Consideration                                                                                            
§ 2.03(c)
Spinco Indemnified
Party                                                                                            
§ 4.02
Spinco Registration
Statement                                                                                            
§ 3.04(a)
TDCC                                                                                            
Preamble
TDCC Common
Stock                                                                                            
Recitals
TDCC
Stockholders                                                                                            
Recitals
Third-Party
Claim                                                                                            
§ 4.06(b)
Total
Cap                                                                                            
Schedule 1.01(q)
Underpayment                                                                                            
§ 5.01(f)(i)

 
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Section 1.03     Interpretation and Rules of Construction.  In this Agreement,
except to the extent otherwise provided or that the context otherwise requires:

(a)      (i) when a reference is made in this Agreement to an Article, Section,
or Exhibit, such reference is to an Article or Section of, or an Exhibit to,
this Agreement; and (ii) when a reference is made in this Agreement to a
Schedule, such reference is to a Schedule included in the Dow Disclosure Letter;

(b)      the table of contents and headings for this Agreement are for reference
purposes only and do not affect in any way the meaning or interpretation of this
Agreement;

(c)      whenever the words “include,” “includes” or “including” are used in
this Agreement, they are deemed to be followed by the words “without
limitation”;

(d)      the words “hereof,” “herein” and “hereunder” and words of similar
import, when used in this Agreement, refer to this Agreement as a whole and not
to any particular provision of this Agreement;

(e)      all terms defined in this Agreement have the defined meanings when used
in any certificate or other document delivered or made available pursuant
hereto, unless otherwise defined therein;

(f)      where used with respect to information, the phrases “delivered” or
“made available” shall mean that the information referred to has been physically
or electronically delivered to the relevant parties or their respective
Representatives, including, in the case of “made available” to Parent or Merger
Sub, material that has been posted in a “data room” (virtual or
otherwise) established by or on behalf of TDCC or Spinco; including further, in
the case of “made available” to TDCC or Spinco, material that has been posted in
a “data room” (virtual or otherwise) established by or on behalf of Parent or
Merger Sub;

(g)      references to “day” or “days” are to calendar days;

(h)      the definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms;

(i)      references to a Person are also to its successors and permitted
assigns;

(j)      when calculating the period of time before which, within which or
following which any act is to be done or step taken pursuant to this Agreement,
the date that is the reference date in calculating such period shall be
excluded.  If the last day of such period is not a Business Day, the period in
question shall end on the next succeeding Business Day; and

(k)      references to sums of money are expressed in lawful currency of the
United States of America, and “$” refers to U.S. dollars.

 
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ARTICLE II

SEPARATION AND CONTRIBUTION

Section 2.01     Transfer of Assets; Assumption of Liabilities.

(a)           Transfer of Assets.  On the terms and subject to the conditions
set forth in this Agreement, on or prior to the Distribution Date, TDCC shall,
and shall cause the applicable Retained Dow Entities to, assign, transfer,
convey and deliver to a Transferred Subsidiary, (i) all of the Retained Dow
Entities’ respective rights, title and interest in and to the Transferred
Assets; and (ii) subject to Section 2.01(e) and free and clear of all
Encumbrances, the Transferred JV Interests.

(b)           Assumption of Liabilities.  On the terms and subject to the
conditions set forth in this Agreement, on or prior to the Distribution Date,
TDCC shall, and shall cause the applicable Retained Dow Entities to, transfer to
a Transferred Subsidiary, and Spinco shall, and shall cause the appropriate
Transferred Subsidiary to, assume, perform, discharge and fulfill, in accordance
with their respective terms, all of the Assumed Liabilities.

(c)           Local Conveyances.  In furtherance of the assignment, transfer,
conveyance and delivery of the Transferred Assets and, subject to Section
2.01(e), the Transferred JV Interests and the assumption of the Assumed
Liabilities, TDCC shall, and shall cause the applicable Retained Dow Entities
and Transferred Subsidiaries to, execute and deliver Local Conveyances as and to
the extent necessary to evidence (i) the assignment, transfer, conveyance and
delivery of all of TDCC’s and the Retained Dow Entities’ right, title and
interest in and to the Transferred Assets and the Transferred JV Interests to
the Transferred Subsidiaries; (ii) the valid and effective assumption of the
Assumed Liabilities by the applicable Transferred Subsidiary; and (iii) the
retention or, to the extent applicable, the assignment, transfer, conveyance and
delivery of the Excluded Assets to, and the retention or, to the extent
applicable, assumption of the Excluded Liabilities by, the applicable Retained
Dow Entity.

(d)           Assets and Liabilities Not Transferred.

(i)           Notwithstanding anything in this Agreement to the contrary, this
Agreement shall not constitute an agreement to assign, directly or indirectly,
any asset or to assume any Liability if an attempted direct or indirect
assignment or assumption thereof, without the consent of a third party or
approval of a Governmental Authority, would constitute a breach, default,
violation or other contravention of the rights of such third party or
Governmental Authority or of applicable Law until such time as the necessary
consent or approval is obtained.

(ii)           If any direct or indirect transfer or assignment by any Retained
Dow Entity to any Transferred Subsidiary, or any direct or indirect acquisition
or assumption by any Transferred Subsidiary, of any interest in, or Liability,
obligation or commitment under, any Transferred Asset or Assumed Liability as
contemplated by this Agreement requires the consent of a third party or approval
of a Governmental Authority (other than consents or approvals that are JV
Transfer Requirements, which are addressed in Section 2.01(e)), then such
transfer or assignment or assumption shall be made subject to such consent of a
third party or approval of a Governmental Authority being obtained.  The parties
hereto shall use their reasonable best efforts to obtain any third-party consent
or approval of a Governmental Authority that is required in order to effect the
transactions contemplated herein as soon as reasonably practicable.  The
obligations set forth in the preceding sentence will terminate on the date that
is two (2) years after the Distribution Date.

 
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(iii)           If any third-party consent or approval of a Governmental
Authority referred to in Section 2.01(d)(ii) is not obtained prior to the
Distribution Date, the Distribution shall, subject to the satisfaction of the
conditions set forth in Article III, nevertheless take place on the terms set
forth herein, and the parties hereto shall use their reasonable best efforts to
establish arrangements under which, on or prior to the Distribution Date,
(A) the Transferred Subsidiaries shall obtain the economic claims, rights and
benefits associated with the Transferred Asset or Assumed Liability with respect
to which the third-party consent or approval of a Governmental Authority has not
been obtained; (B) the Transferred Subsidiaries shall have dominion and control
over the Transferred Assets and TDCC shall operate such Transferred Assets only
as directed by the applicable Transferred Subsidiaries; and (C) from and after
the Distribution Date, the Transferred Subsidiaries shall assume the economic
burden with respect to the Transferred Asset or Assumed Liability with respect
to which the third-party consent or approval of a Governmental Authority has not
been obtained in accordance with this Agreement.

(iv)           If and when any such third-party consent or approval of a
Governmental Authority is obtained after the Distribution, the assignment of the
applicable Transferred Asset or assumption of the applicable Assumed Liability
shall be promptly effected in accordance with the terms of this Agreement
without the payment of additional consideration.

(v)           In the event that at any time prior to the date that is
two (2) years after the Distribution Date, a party hereto becomes aware that a
Retained Dow Entity possesses any Transferred Asset or is subject to an Assumed
Liability, the parties hereto shall cause the prompt transfer of such
Transferred Assets to a Transferred Subsidiary or the assumption of such Assumed
Liability by a Transferred Subsidiary, in each case, without further
consideration.

(vi)           In the event that at any time prior to the date that is
two (2) years after the Distribution Date, a party hereto becomes aware that a
Transferred Subsidiary possesses any Excluded Assets or is subject to an
Excluded Liability, the parties hereto shall cause the prompt transfer of such
Excluded Assets to a Retained Dow Entity or the assumption of such Excluded
Liability by a Retained Dow Entity, in each case, without further consideration.

 
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(e)           JV Transfer.

(i)           Notwithstanding anything to the contrary contained in this
Agreement, in the event that the conditions set forth in Section 3.01 (other
than conditions that by their nature are to be satisfied at the time of the
Distribution, and other than conditions relating to any JV Transfer
Requirements) have been satisfied, but a JV Transfer Requirement has not been
satisfied, the Distribution and the Internal Separation shall occur other than
with respect to the Transferred JV Interests and the Delayed JV Closing
Assets.  The Transferred JV Interests and the Delayed JV Closing Assets shall
not be transferred to a Transferred Subsidiary at or prior to the time of the
Distribution unless subsequently transferred to a Parent Entity at a closing
pursuant to Section 2.01(e)(iii) (a “Delayed JV Closing”, and the date of a
Delayed JV Closing, the “Delayed JV Closing Date”).  Prior to the occurrence of
the Delayed JV Closing, TDCC shall hold the Transferred JV Interests and the
Delayed JV Closing Assets in trust for Spinco, and Spinco shall be entitled to
all of the economic benefits, and shall bear all of the economic burdens,
associated with the ownership of the Transferred JV Interests and the Delayed JV
Closing Assets, including the right to receive distributions and dividends of
cash, property or securities received and retained by Dow in its capacity as a
holder of the Transferred JV Interests; provided, however, that Spinco shall
have no right to vote, or direct the voting of, the Transferred JV Interests;
provided, further, that nothing herein shall be deemed or interpreted to
constitute a transfer of legal ownership in the JV Entity prior to the
satisfaction of the JV Transfer Requirements.

(ii)           The parties hereto shall, and shall cause their respective
Affiliates to, cooperate fully and use their reasonable best efforts to take
such actions with respect to the JV Transfer Requirements as may be reasonably
requested by a party hereto in order to permit the transfer of the Transferred
JV Interests and the Delayed JV Closing Assets.  The obligations set forth in
this Section 2.01(e)(ii) shall survive the Distribution.

(iii)           If, after the Distribution, all of the JV Transfer Requirements
become satisfied, then the transfer of the Transferred JV Interests and the
Delayed JV Closing Assets shall be effected and the parties hereto shall, and
shall cause their respective Affiliates to, execute and deliver such documents
and other instruments as may be reasonably necessary to transfer the Transferred
JV Interests and the Delayed JV Closing Assets to a Transferred Subsidiary.

(iv)           TDCC shall, and shall cause its Affiliates to, comply with its
obligations under the JV LLC Agreement, including Section 7.10 thereof
(including with respect to the notice required to be sent under Section 7.10 of
the JV LLC Agreement, which shall be sent as soon as reasonably practicable
after the date hereof), in connection with the Internal Separation, the
Separation, the Merger and the other transactions contemplated by this Agreement
and the other Transaction Documents.

Section 2.02     Partially Transferred Contracts; Permits.

(a)           The parties hereto shall use their reasonable best efforts to
separate the Partially Transferred Contracts into separate contracts so that the
Transferred Subsidiaries will be entitled to rights and benefits and shall be
subject to the portion of Liabilities with respect to each Partially Transferred
Contract to the extent related to the Business, and the Retained Dow Entities
will have the rights and benefits and shall be subject to the portion of
Liabilities with respect to each Partially Transferred Contract to the extent
not related to the Business.  If the counterparty to any Partially Transferred
Contract that is entitled under the terms of the Partially Transferred Contract
to consent to the separation of the Partially Transferred Contract has not
provided such consent or if the separation of a Partially Transferred Contract
has not been completed as of the Distribution Date for any other reason, then
the parties hereto shall use their reasonable best efforts to develop and
implement arrangements to make the portion of the Partially Transferred Contract
related to the Business available for use by, and for the benefit of, the
Transferred Subsidiaries and to make the portion of the Partially Transferred
Contract not related to the Business available for use by, and for the benefit
of, the Retained Dow Entities.  If and when any such consent is obtained, the
Partially Transferred Contract will be separated in accordance with this Section
2.02(a).  The obligations set forth in this Section 2.02(a) will terminate on
the date that is two (2) years after the Distribution Date.  Spinco and TDCC
shall share equally any costs related to separating the Partially Transferred
Contracts.

 
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(b)           Without limiting Section 2.01(d), TDCC shall use its reasonable
best efforts to obtain or cause to be obtained, prior to the Distribution Date,
on behalf of the Transferred Subsidiaries any Environmental Permits or other
permits, licenses, approvals and authorizations issued or granted by any
Governmental Authority and, with respect to any Transferred Sites (and any
Transferred Facility located thereon) any emissions credits, allowances or
rights that (i) are necessary to own or operate the Business from and after the
Distribution Date; and (ii) are not Transferred Permits.  In the event that any
such Environmental Permits or other permits, licenses, approvals and
authorizations have not been obtained prior to the Distribution Date, TDCC and
Spinco shall use their reasonable best efforts to develop and implement lawful
arrangements under which Spinco shall obtain the benefit of any Environmental
Permits held by Dow in connection with the ownership and operation of the
Business following the Distribution.  The obligations set forth in this Section
2.02(b) will terminate on the date that is two (2) years after the Distribution
Date.

Section 2.03     Financing Arrangements; Contribution.

(a)           On or prior to the Distribution Date, subject to Parent complying
with its obligations under Section 7.08 of the Merger Agreement, Spinco shall
enter into a definitive agreement or agreements providing for indebtedness in an
aggregate principal amount of not less than the Below Basis Amount consisting of
(i) debt securities on terms and conditions reasonably satisfactory to Parent
after consultation with TDCC; or (ii) if and to the extent such debt securities
are not issued for any reason in the Below Basis Amount, a credit facility on
the terms and conditions set forth in the Spinco Commitment Letter or otherwise
in accordance with Section 7.08 of the Merger Agreement (the “New Debt”).

(b)           Immediately prior to the Distribution, subject to Parent complying
with its obligations under Section 7.08 of the Merger Agreement and the
availability of the Financing or the Alternative Financing (each as defined in
the Merger Agreement), as applicable, Spinco shall incur the New Debt and
receive the net proceeds thereof.

 
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(c)           Immediately prior to the Distribution, TDCC shall effect the
Contribution.  In consideration for the Contribution, Spinco shall (i) issue to
TDCC an additional 99,999,500 shares of Spinco Common Stock; (ii) as further
described in Section 7.08(e) of the Merger Agreement, (A) issue to TDCC the
Spinco Securities; or (B) pay to TDCC as a dividend the Above Basis Amount, in
immediately available funds to one or more accounts designated by TDCC; and
(iii) pay to TDCC as a dividend the Special Payment, in immediately available
funds to one or more accounts designated by TDCC (together, the “Spinco
Consideration”).

Section 2.04     Certain Resignations.  TDCC shall deliver, or cause to be
delivered, (a) on or prior to the Distribution Date, resignations of each of the
individuals who serves as a director of any of the Transferred Subsidiaries; and
(b) on the later of the Distribution Date and the date on which the Transferred
JV Interests are transferred to a Parent Entity, resignations of each of the
individuals who serves as a director of the JV Entity and was appointed by Dow,
in each case if requested by a Parent Entity prior to the applicable date
referred to above.

ARTICLE III

THE DISTRIBUTION

Section 3.01     Conditions to the Distribution.  The obligations of TDCC
pursuant to this Agreement to effect the Distribution shall be subject to the
substantially simultaneous consummation of the transactions contemplated by
Section 2.03 and the satisfaction or waiver by (a) TDCC and Parent, in the case
of the conditions set forth in Section 8.01 of the Merger Agreement (other than
the Distribution); and (b) TDCC, in the case of the conditions set forth in
Section 8.03 of the Merger Agreement, in each case, on or prior to the
Distribution Date (other than those conditions that, by their nature, are to be
satisfied contemporaneously with the Distribution, but subject to the
satisfaction or waiver by (i) TDCC and Parent, in the case of the conditions set
forth in Section 8.01 of the Merger Agreement; and (ii) TDCC, in the case of the
conditions set forth in Section 8.03 of the Merger Agreement); provided, that
notwithstanding anything set forth in this Article III to the contrary, the
parties hereto agree that the Distribution Date shall occur on the same date as
the Closing Date.

Section 3.02     Form of the Distribution.

(a)           TDCC may elect, in its sole discretion, to effect the Distribution
in the form of (i) a One-Step Spin-Off; (ii) an Exchange Offer (including any
Clean-Up Spin-Off); or (iii) any combination of a One-Step Spin-Off and an
Exchange Offer (including any Clean-Up Spin-Off).  All shares of Spinco Common
Stock held by TDCC on the Distribution Date will be distributed to TDCC
Stockholders in the manner determined by TDCC and in accordance with Section
3.02(e).

(b)           If TDCC elects to effect all or any portion of the Distribution in
the form of a One-Step Spin-Off, the TDCC Board, in accordance with applicable
Law, will establish (or designate Persons to establish) a Record Date and the
Distribution Date and TDCC will establish appropriate procedures in connection
with, and to effectuate in accordance with applicable Law, the Distribution.

 
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(c)           If TDCC elects to effect all or any portion of the Distribution as
an Exchange Offer, TDCC will determine the terms of such Exchange Offer,
including the number of shares of Spinco Common Stock that will be offered for
each validly tendered share of TDCC Common Stock, the period during which such
Exchange Offer will remain open, the procedures for the tender and exchange
of shares and all other terms and conditions of such Exchange Offer, in
accordance with applicable Law.  In the event that the Exchange Offer is not
fully subscribed, all shares of Spinco Common Stock held by TDCC on the
Distribution Date that are not exchanged pursuant to the Exchange Offer (other
than with respect to any shares of Spinco Common Stock comprising any portion of
the Distribution effected as a One-Step Spin-Off) will be distributed as a
dividend to TDCC Stockholders on a pro rata basis on the Distribution Date
immediately following the consummation of the Exchange Offer and the Record Date
for the Clean-Up Spin-Off shall be established as of such date in the same
manner provided in Section 3.02(b) (the “Clean-Up Spin-Off”), so that, together
with any shares of Spinco Common Stock comprising any portion of the
Distribution effected as a One-Step Spin-Off, TDCC will be treated for U.S.
federal income Tax purposes as having distributed all of the shares of Spinco
Common Stock to the TDCC Stockholders.  The terms and conditions of any Clean-Up
Spin-Off shall be as determined by TDCC in accordance with applicable Law.

(d)           TDCC, Spinco, or the Exchange Agent, as applicable, shall be
entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement such amounts as are required to be deducted and
withheld with respect to the making of such payments under the Code or any
provision of local or foreign Tax Law.  Any withheld amounts will be treated for
all purposes of this Agreement as having been paid to the Persons otherwise
entitled thereto.

(e)           Upon the consummation of the Distribution, TDCC will deliver to
the Exchange Agent, a global certificate representing the Spinco Common Stock
being distributed in the One-Step Spin-Off or exchanged in the Exchange Offer,
as the case may be, for the account of the TDCC Stockholders that are entitled
thereto.  Upon a Clean-Up Spin-Off, if any, TDCC will deliver to the Exchange
Agent an additional global certificate representing the Spinco Common Stock
being distributed in the Clean-Up Spin-Off for the account of the Record Holders
that are entitled thereto.  The Exchange Agent will hold such certificate or
certificates, as the case may be, for the account of the TDCC Stockholders
pending the Merger, as provided in the Merger Agreement.  Immediately prior to,
at and after the time of the Distribution, the shares of Spinco Common Stock
will not be transferable and the Exchange Agent will not transfer any shares of
Spinco Common Stock.  The Distribution will be deemed to be effective upon
written authorization from TDCC to the Exchange Agent.

Section 3.03     Manner of the Distribution.

(a)           To the extent the Distribution is effected as a One-Step Spin-Off,
subject to the terms thereof, in accordance with Section 3.02(e), each Record
Holder will be entitled to receive for each share of TDCC Common Stock held by
such Record Holder a number of shares of Spinco Common Stock equal to the total
number of shares of Spinco Common Stock held by TDCC on the Distribution Date,
multiplied by a fraction, the numerator of which is the number of shares of TDCC
Common Stock held by such Record Holder and the denominator of which is the
total number of shares of TDCC Common Stock outstanding on the Distribution Date
(excluding treasury shares held by TDCC and any shares of TDCC Common Stock
otherwise held by a Dow Entity).

 
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(b)            To the extent the Distribution is effected as an Exchange Offer,
subject to the terms thereof, in accordance with Section 3.02(e), each TDCC
Stockholder may elect in the Exchange Offer to exchange a number of shares of
TDCC Common Stock held by such TDCC Stockholder for shares of Spinco Common
Stock in such quantities, at such an exchange ratio and subject to such other
terms and conditions as may be determined by TDCC and set forth in the Spinco
Registration Statement.  The terms and conditions of any Clean-Up Spin-Off will
be as determined by TDCC, subject to the provisions of Section 3.03(a), mutatis
mutandis.

(c)           None of the parties hereto, nor any of their Representatives, will
be liable to any Person in respect of any shares of Spinco Common Stock (or
dividends or distributions with respect thereto) that are properly delivered to
a public official pursuant to any applicable abandoned property, escheat or
similar Law.

Section 3.04     Actions Prior to Distribution.

(a)           Spinco will cooperate with TDCC to accomplish the Distribution,
including in connection with the preparation of all documents and the making of
all filings required in connection with the Distribution.  TDCC will be
permitted to reasonably direct and control the efforts of the parties hereto in
connection with the Distribution (including the selection of any investment bank
or manager in connection with the Distribution, as well as any financial
printer, solicitation and/or exchange agent and financial, legal, accounting and
other advisors for TDCC), and Spinco will use its reasonable best efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
other things reasonably necessary to facilitate the Distribution as reasonably
directed by TDCC in good faith.  Without limiting the generality of the
foregoing, Spinco will, and will cause its Representatives to, as reasonably
directed by TDCC in good faith, reasonably cooperate in and take the following
actions:  (i) preparing and filing the registration under the Securities Act or
the Exchange Act of Spinco Common Stock on an appropriate registration form or
forms to be designated by TDCC (the “Spinco Registration Statement”);
(ii) participating in meetings, drafting sessions, due diligence sessions,
management presentation sessions and “road shows” in connection with the
Distribution (including any marketing efforts), which participation shall be
subject to, and may be concurrent with, any such activities required with
respect to the Exchange Offer; (iii) furnishing to any dealer manager or other
similar agent participating in the Distribution (A) “cold comfort” letters from
independent public accountants in customary form and covering such matters as
are customary for an underwritten public offering (including with respect to
events subsequent to the date of financial statements included in any offering
document); and (B) opinions and negative assurance letters of counsel in
customary form and covering such matters as may be reasonably requested; and
(iv) furnishing all historical and forward-looking financial and other pertinent
financial and other information that is available to Spinco and is reasonably
required in connection with the Distribution.

(b)           TDCC and Spinco will prepare and mail, prior to any Distribution
Date, to the TDCC Stockholders, such information concerning Spinco, Parent,
their respective businesses, operations and management, the Distribution and
such other matters as TDCC will reasonably determine and as may be required by
Law.  TDCC and Spinco will prepare, and Spinco will, to the extent required
under applicable Law, file with the SEC any such documentation and any requisite
no-action letters that TDCC determines are necessary or desirable to effectuate
the Distribution and TDCC and Spinco will each use their reasonable best efforts
to obtain all necessary approvals from the SEC with respect thereto as soon as
practicable.

 
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(c)            TDCC and Spinco will take all such action as may be necessary or
appropriate under the securities or blue sky Laws of the United States (and any
comparable Laws under any foreign jurisdiction) in connection with the
Distribution.

(d)           Upon satisfaction of the conditions set forth in Section 3.01,
TDCC shall effect the Distribution on the Distribution Date.

ARTICLE IV

MUTUAL RELEASE; INDEMNIFICATION

Section 4.01     Mutual Release.

(a)           Effective as of the time of the Distribution and except as
otherwise specifically set forth in this Agreement (including Section 4.01(b))
or in any of the other Transaction Documents, each of TDCC, on behalf of itself
and each of the Retained Dow Entities and their respective successors and
assigns, on the one hand, and Spinco, on behalf of itself and each of the
Transferred Subsidiaries and their respective successors and assigns, on the
other hand, hereby irrevocably, unconditionally and completely waives and
releases and forever discharges the other party hereto and its Subsidiaries, and
its and their respective Representatives and their respective heirs, executors,
administrators, successors and assigns (such released Persons, the “Releasees”),
of and from all debts, demands, actions, causes of action, suits, accounts,
covenants, contracts, agreements, damages, claims and other Liabilities
whatsoever of every name and nature, both in law and in equity, arising out of
or related to events, circumstances or actions taken by such other party
occurring or failing to occur, in each case, at or prior to the Distribution
Date.  Neither party hereto shall make, and each party hereto shall not permit
any member of its Group or their respective Representatives to make, any claim
or demand, or commence any Action asserting any claim or demand, including any
claim of contribution or any indemnification, against any member of the other
party’s Group or any of other party’s Releasees with respect to any Liabilities
released pursuant to this Section 4.01(a).

(b)           No right of any Person to enforce any Transaction Document shall
be waived, released or otherwise discharged pursuant to Section
4.01(a).  Nothing contained in Section 4.01(a) shall waive, release or otherwise
discharge any Person from:

(i)           any Liability provided for in, or resulting from, any Transaction
Document;

(ii)           any Liability retained, assumed, transferred, assigned or
allocated to the Group of which such Person is a member, in accordance with any
Transaction Document;

 
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(iii)           any Liability that the parties hereto may have with respect to
indemnification or contribution pursuant to this Agreement for Third-Party
Claims, which Liability shall be governed by the provisions of this Article IV
and, if applicable, the appropriate provisions of the other Transaction
Documents; or

(iv)           any Liability the release of which would result in the release of
any Person other than a Person released pursuant to this Section 4.01.

Section 4.02     Indemnification by TDCC.  Except as provided in this Article
IV, Spinco and its Affiliates and each of their respective officers, directors,
employees and agents (collectively, the “Spinco Indemnified Parties”) shall,
from and after the Distribution Date, be indemnified and held harmless by TDCC
from and against any and all Liabilities, claims, losses, damages, costs,
expenses, interest, awards, judgments and penalties (including reasonable
attorneys’ and consultants’ fees and expenses) actually suffered or incurred by
them (collectively, “Losses”), to the extent arising or resulting from any
Excluded Liability.

Section 4.03     Indemnification by Spinco.  Except as provided in this Article
IV , TDCC and its Affiliates and each of their respective officers, directors,
employees and agents (collectively, the “Dow Indemnified Parties”) shall, from
and after the Distribution Date, be indemnified and held harmless by Spinco from
and against any and all Losses, to the extent arising or resulting from any
Assumed Liability.

Section 4.04     Limitations on Indemnification.

(a)           For all purposes of this Article IV, “Losses” shall be net of
(i) any recovery or benefit (including insurance and indemnification) actually
received by the Indemnified Party or any of its Affiliates in connection with
the facts giving rise to the right of indemnification and, if the Indemnified
Party or any of its Affiliates receives such recovery or benefit after receipt
of payment from the Indemnifying Party, then the amount of such recovery or
benefit, net of reasonable expenses incurred in obtaining such recovery or
benefit, shall be paid to the Indemnifying Party; (ii) any Tax benefit actually
realized (on a “with” and “without” basis) by the Indemnified Party or any of
its Affiliates arising as a result of the accrual, incurrence or payment of any
such Losses; and (iii) any amount included in the Final Working Capital
Statement specifically with respect to any such Loss.

(b)           Each party hereto shall, and shall cause its respective
Representatives to, take all reasonable steps to mitigate its Losses upon and
after becoming aware of any event that could reasonably be expected to give rise
to any Losses, and indemnification shall not be available with respect to any
Loss to the extent such Loss is attributable to a failure by a party to take (or
cause its Representatives to take) reasonable steps to mitigate such Loss.  No
party hereto shall be entitled to any payment, adjustment or indemnification
more than once with respect to the same matter.

Section 4.05     No Right to Set-Off.  No party hereto shall have any right to
set off any Losses under this Article IV against any payments to be made by such
party pursuant to this Agreement or any other agreement between the parties
hereto, including any Transaction Document.

 
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Section 4.06     Notice of Loss; Third-Party Claims.
 
(a)           An Indemnified Party shall promptly give the Indemnifying Party
written notice in reasonable detail of any matter which an Indemnified Party has
determined has given, or could give, rise to a right of indemnification under
this Agreement, stating the amount of the Loss, if known, and method of
computation thereof, and containing a reference to the provisions of this
Agreement in respect of which such right of indemnification is claimed or
arises.

(b)           If an Indemnified Party shall receive notice of any Action, audit,
demand or assessment against it (each, a “Third-Party Claim”) that could give
rise to a claim for Loss under this Agreement, the Indemnified Party shall
promptly give the Indemnifying Party written notice in reasonable detail of such
Third-Party Claim, stating the amount of the Loss, if known, and method of
computation thereof, and containing a reference to the provisions of this
Agreement in respect of which such right of indemnification is claimed or
arises, together with copies of all notices and documents served on or received
by the Indemnified Party and its Representatives in respect thereof.  A failure
by the Indemnified Party to give notice in a timely manner pursuant to this
Section 4.06(b) shall not limit the obligation of the Indemnifying Party under
this Agreement, except (i) to the extent such Indemnifying Party is materially
prejudiced thereby; (ii) to the extent expenses are incurred during the period
in which notice was not provided; and (iii) as provided by Section 4.04.  The
Indemnifying Party shall be entitled to assume and control the defense of such
Third-Party Claim at its expense and through counsel of its choice, if it gives
notice of its intention to do so to the Indemnified Party within 30 days of the
receipt of such notice from the Indemnified Party, it being understood that such
election shall be without prejudice to the rights of the Indemnifying Party to
dispute whether such claim involves recoverable or indemnifiable Losses under
this Agreement.  If the Indemnifying Party elects to undertake any such defense
against a Third-Party Claim, the Indemnified Party shall be kept apprised of all
material developments and may participate in such defense at its own expense,
and the Indemnifying Party shall not withdraw from the defense of such claim
without providing advance notice to the Indemnified Party reasonably sufficient
to allow the Indemnified Party to prepare to reassume the defense of such
claim.  The Indemnified Party shall cooperate with the Indemnifying Party in
such defense and make available to the Indemnifying Party, at the Indemnifying
Party’s expense, all witnesses, pertinent records, materials and information in
the Indemnified Party’s possession or under the Indemnified Party’s control
relating thereto (or in the possession or control of any of its Representatives)
as is reasonably requested by the Indemnifying Party or its counsel.  If the
Indemnifying Party elects to direct the defense of any such Third-Party Claim,
the Indemnified Party shall not pay, or permit to be paid, any part of such
Third-Party Claim unless (i) the Indemnifying Party consents in writing to such
payment; (ii) the Indemnifying Party withdraws from the defense of such
Third-Party Claim; or (iii) a final judgment from which no appeal may be taken
by or on behalf of the Indemnifying Party is entered against the Indemnified
Party for such Third-Party Claim.  If the Indemnifying Party has not assumed the
defense of any such Third-Party Claim pursuant to this Section 4.06 and the
Indemnified Party proposes to settle such Third-Party Claim prior to a final
judgment thereon or to forgo any appeal with respect thereto, then the
Indemnified Party shall give the Indemnifying Party prompt written notice
thereof and the Indemnifying Party shall have the right to participate in the
settlement, or assume the defense of such Third-Party Claim at its expense.  The
Indemnified Party shall not admit any liability with respect to, or settle,
compromise or discharge any Third-Party Claim without the Indemnifying Party’s
prior written consent (such consent not to be unreasonably withheld, conditioned
or delayed).  The Indemnifying Party shall not admit any liability with respect
to, or settle, compromise or discharge, any Third-Party Claim without the
Indemnified Party’s prior written consent (such consent not to be unreasonably
withheld, conditioned or delayed).

 
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Section 4.07     Remedies.  Each of the parties hereto acknowledges and agrees
that, following the Distribution Date, (a) (i) except with respect to breaches
of any covenants or agreements set forth in this Agreement; (ii) except with
respect to matters covered by Section 5.01; and (iii) other than as provided in
Section 8.11, (A) the indemnification provisions set forth in Article IV and in
the Tax Matters Agreement and the covenants set forth in this Agreement and the
Merger Agreement shall be the sole and exclusive remedies of the parties hereto
and the parties to the Local Conveyances, as applicable, for any breach of any
Local Conveyance and for any failure to perform and comply with any covenant or
agreement in any Local Conveyance; (B) none of the parties hereto, their
respective Representatives or any other Person may bring a claim under any Local
Conveyance; and (C) any and all claims arising out of, or in connection with,
the Transferred Subsidiaries, the Transferred Assets, the Assumed Liabilities,
the Business or the transactions contemplated in this Agreement, but only to the
extent arising out of events, circumstances or conditions occurring or failing
to occur, or actions or omissions by such other party, in each case, at or prior
to the Distribution Date, must be brought under and in accordance with the terms
of this Agreement or, to the extent provided in the Merger Agreement, the Merger
Agreement; and (b) notwithstanding anything herein to the contrary, no breach of
this Agreement or any Local Conveyance shall give rise to any right on the
part of any party hereto or thereto, after the consummation of the transactions
contemplated by this Agreement, to rescind this Agreement, any Local Conveyance
or any of the transactions contemplated hereby or thereby.  Each party hereto
shall cause its Representatives to comply with this Section 4.07.

Section 4.08     Tax Matters.

(a)           Notwithstanding anything in this Article IV to the contrary, the
rights and obligations of the parties hereto with respect to indemnification for
any and all Tax matters shall be solely governed by the Tax Matters Agreement
and shall not be subject to the provisions of this Article IV.

(b)           Any amount (other than interest attributable to a period beginning
after the Distribution Date) payable hereunder by TDCC to Spinco shall be
treated as a contribution by TDCC to the capital of Spinco, and any amount
(other than interest attributable to a period beginning after the Distribution
Date) payable hereunder by Spinco to TDCC shall be treated as a distribution by
Spinco to TDCC.

Section 4.09     Further Environmental Provisions.

(a)           With respect to any Remedial Action that is required to satisfy
TDCC’s indemnification obligations under Section 4.02 for any Dow Environmental
Liabilities:

(i)           TDCC shall have the right, but not the obligation, to conduct and
control the Remedial Action; provided, however, that, if TDCC opts to conduct
such Remedial Action, TDCC shall do so without unreasonably or materially
interfering with any Parent Entity’s operations. With respect to any Remedial
Action at any Transferred Leased Real Property, Transferred Owned Real Property,
Transferred Appurtenant Real Property or Transferred Facility, the party that
conducts the Remedial Action (A) shall consult with the other party in all
material respects in connection with undertaking the Remedial Action, (B) shall
provide the other party with copies of all material correspondence submitted to
and received from any Governmental Authority relating to the Remedial Action or
to the associated presence or Release of Hazardous Materials, and shall provide
the other party with reasonable opportunity to suggest comments to any material
submissions to any Governmental Authority with respect thereto, including to any
Remedial Action plans or proposals and (C) shall, and shall cause its
Representatives to, provide the other party with reasonable notice of all
material planned meetings and telephone conferences with the applicable
Governmental Authority, and Spinco and its Representatives shall have the right
to attend and reasonably participate in such meetings and telephone conferences;

 
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(ii)           In the event TDCC opts to conduct the Remedial Action, Spinco
shall, and shall cause its Representatives to, cooperate with TDCC, including by
providing access to the subject site, including access to install, maintain,
replace and operate wells and remove impacted soil and/or groundwater; provided,
that neither such access, nor such installation, maintenance, replacement,
operation or removal, shall unreasonably or materially interfere with any Parent
Entity’s operations; and

(iii)           TDCC shall not be obligated to indemnify any Spinco Indemnified
Party for the costs to conduct such Remedial Action to the extent such costs are
in excess of the costs to conduct such Remedial Action in the most reasonably
cost-effective manner, which manner shall incorporate (A) the least stringent
clean-up standards that, based upon the use classification (industrial,
commercial or residential) of a subject site as of the Distribution Date, are
allowed under applicable Environmental Law and any applicable Environmental
Permit and those standards that are required under the terms of an applicable
Ground Lease; and (B) the least costly methods that are allowed under applicable
Environmental Law and any applicable Environmental Permit and those standards
that are required under the terms of an applicable Ground Lease, and are
approved by, or otherwise acceptable to, applicable Governmental Authorities to
achieve such standards, including the use of engineering and institutional
controls to eliminate or minimize exposure pathways; provided, that, at any
Transferred Site or Transferred Facility thereon, and, during the term of the
Ground Lease underlying any Retained Site or Transferred Facility thereon, TDCC
shall not be responsible for any operation and maintenance with respect to any
such institutional or engineering controls, including any cap, impermeable
barrier or, with respect to soil vapor, venting system, after completion of
their initial installation, and such post-installation costs shall not be
subject to indemnification; provided, however, that TDCC shall remain
responsible for the operation and maintenance of any such control that entails
removing, monitoring, containing and treating groundwater or soil vapor
contaminated with Hazardous Materials, until and so long as such removal,
monitoring, containment and treatment is no longer required under Environmental
Law or any applicable Environmental Permit.

 
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(b)           With respect to any action (other than any such action that is a
Remedial Action), to correct a violation of or a noncompliance with any
Environmental Law or Environmental Permit that is required to satisfy TDCC’s
indemnification obligations under Section 4.02 for any Dow Environmental
Liabilities:

(i)           Spinco shall control the conduct of such corrective action;
provided, however, that Spinco shall consult with TDCC in all material respects
in connection with undertaking the corrective action, shall provide TDCC with
copies of all material correspondence submitted to and received from any
Governmental Authority relating to the corrective action or to any associated
violation or noncompliance, and shall provide TDCC with reasonable opportunity
to provide comments to any material submissions to any Governmental Authority
with respect thereto, including to any corrective action plans or proposals;

(ii)           Spinco shall, and shall cause its Representatives to, provide
TDCC with reasonable notice of all planned meetings and telephone conferences
with the applicable Governmental Authority, and TDCC and its Representatives
shall have the right to attend and participate in such meetings and
telephone conferences;

(iii)           TDCC shall not be obligated to indemnify any Spinco Indemnified
Party for capital costs incurred in connection with the implementation of a
corrective action that are in excess of the minimum amount required to achieve
compliance with any applicable Environmental Law or Environmental Permit in
effect as of the Distribution Date, and, for the avoidance of doubt, the parties
hereto acknowledge that TDCC shall under no circumstances be responsible for any
corrective action that is required or recommended pursuant to any internal
standards, policies or guidelines of TDCC or any of its Affiliates to the extent
that such corrective action exceeds the minimum requirements of any such
Environmental Law or Environmental Permit, except to the extent such corrective
action is required to comply with the terms of an applicable Ground Lease;
provided, however, that the corrective action shall be sufficient to allow
Spinco to operate in a manner and at a level of production that is consistent
with the subject facility’s operations conducted during the twelve (12)-month
period prior to the date of this Agreement;

(iv)           For the avoidance of doubt, to the extent required to address any
violation or noncompliance existing or occurring prior to the Distribution Date
by making any capital upgrade, TDCC shall be responsible for the costs of the
capital upgrade (and any related fines or penalties) but shall not be
responsible for any operating costs after the Distribution Date related to any
such capital upgrade after the upgrade is completed;

 
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(v)           TDCC shall under no circumstances be responsible for any removal,
abatement, encapsulation or maintenance of any Hazardous Materials included in
any building material or equipment, including any such Hazardous Materials
discovered, encountered or disturbed pursuant to any demolition, renovation or
construction, whether such demolition, renovation or construction was commenced
prior or after the Distribution Date; and

(vi)           for the sake of clarity, the parties hereto acknowledge that this
Section 4.09(b) does not in any way limit, condition or otherwise affect TDCC’s
right to control the defense of any Third-Party Claim, including any Third-Party
Claim seeking fines or penalties for any pre-Distribution violation of or
noncompliance with any Environmental Law or Environmental Permit.

(c)           With respect to TDCC’s indemnification obligations under Section
4.02 for any Dow Environmental Liability, TDCC shall not be responsible for
Losses to the extent they are caused, triggered or increased by (i) any act or
omission of any Parent Entity, Spinco or one of their respective Representatives
after the Distribution Date, which act or omission is negligent or is in
violation of any Environmental Law or Environmental Permit applicable to the
Business after the Distribution Date, or is in breach of any covenant of Spinco
contained in this Agreement that relates to Environmental Law or the Dow
Environmental Liabilities and is to be performed in whole or part after the
Distribution Date; (ii) any change in use classification of a subject
Transferred Leased Real Property, Transferred Owned Real Property or Transferred
Facility, after the Distribution Date, from industrial to commercial or
residential or from commercial to residential (it being understood that this
Section 4.09(c)(ii) shall not affect the terms of any other Transaction Document
with respect to changes in the use classification of real property); (iii) any
voluntary disclosure after the Distribution Date by or on behalf of Parent,
Spinco or any of their respective Representatives of any information, except for
(A) any self-disclosure under any applicable U.S. Environmental Protection
Agency Audit Policy, or any similar state, federal or foreign policy relating to
audit and self-disclosure of noncompliance; or (B) any disclosure reasonably
necessary to respond to any Third-Party Claim or to comply with any unsolicited
request by any Governmental Authority or any applicable Environmental Law or
Environmental Permit; (iv) any voluntary decommissioning, closure or shutdown of
a facility or a unit, including a waste management unit (other than any such
decommissioning, closure or shutdown of a facility or unit initiated by Dow);
and (v) any sampling and analysis of any environmental media conducted after the
Distribution Date by or on behalf of any Parent Entity, Spinco or one of their
respective Representatives unless such sampling and analysis is (A) required by
Environmental Law or by a Governmental Authority; (B) required to be conducted
in response to a Third-Party Claim alleging that Hazardous Materials have been
Released from, or migrated offsite from, a subject Transferred Leased Real
Property, Transferred Owned Real Property or Transferred Facility;
(C) reasonably conducted in connection with any construction of improvements and
with respect to any Retained Site or any Transferred Facility located thereon,
undertaken consistent with the terms of the applicable Ground Lease; or (D) the
result of the discovery after the Distribution Date of a suspected Release of
Hazardous Materials that poses an imminent endangerment to the environment or
human health.

 
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(d)           Spinco acknowledges that its sole and exclusive remedy against
TDCC or any Affiliate of TDCC for any Losses relating to any Environmental Laws,
Environmental Permits or Hazardous Materials, or any environmental, health or
safety matter, including natural resources to the extent arising out of events,
circumstances or conditions occurring or failing to occur, or actions or
omissions by TDCC, in each case, at or prior to the Distribution Date
(“Environmental Losses”), is under Section 4.02.  In furtherance of the
foregoing, from and after the Distribution Date, except for any Losses for which
TDCC is obligated to indemnify Spinco pursuant to Section 4.02, (i) Spinco
hereby releases, on its behalf and on behalf of its Affiliates, predecessors,
successors and assigns, officers, directors, employees, agents and partners, to
the fullest extent permitted under applicable Law, each TDCC Indemnified Party
from, but only to the extent arising out of events, circumstances or conditions
occurring or failing to occur, or actions or omissions by TDCC, in each case, at
or prior to the Distribution Date, (A) any Environmental Losses incurred by the
Spinco Indemnified Parties; and (B) any other environmental, health or safety
matter, including natural resources, related in any way to the Business, the
Transferred Owned Real Property, the Transferred Leased Real Property or the
Transferred Facilities or this Agreement or its subject matter; and (ii) Spinco
hereby waives, on its behalf and on behalf of its Affiliates, predecessors,
successors and assigns, officers, directors, employees, agents and partners, to
the fullest extent permitted under applicable Law, but only to the extent
arising out of events, circumstances or conditions occurring or failing to
occur, or actions or omissions by TDCC, in each case, at or prior to the
Distribution Date, any claim or remedy against TDCC Indemnified Parties now or
hereafter available under any applicable Environmental Law, including the
Comprehensive Environmental Response, Compensation and Liability Act or any
similar Law, whether or not in existence on the date hereof.

(e)           Notwithstanding anything to the contrary contained in this
Agreement: (i) (A) none of TDCC or any of its Representatives shall be liable
for any claim for indemnification for any Dow Environmental Liability that
relates to a Transferred Leased Real Property or Transferred Owned Real
Property, or any Transferred Facility located on either such property, that is
made after the tenth anniversary of the Distribution Date; provided, however,
that any claim made with reasonable specificity by Spinco prior to the tenth
anniversary of the Distribution Date shall survive until such claim is finally
and fully resolved; and (B) the maximum amount of indemnifiable Losses which may
be recovered from TDCC arising out of, or resulting from, any Dow Environmental
Liability that relates to a Transferred Leased Real Property or Transferred
Owned Real Property, or any Transferred Facility located on either such
property, shall be an amount equal to $1,040,000,000; and (ii) no Losses
resulting from a pre-Distribution Date violation by Dow of any Environmental Law
or Environmental Permit may be claimed under Section 4.02 as a Dow Environmental
Liability other than Losses in excess of $150,000 resulting from any single
claim or series of related claims arising out of the same facts, events or
circumstances (the “Environmental Deminimis”); provided, however, for the
avoidance of doubt, the Environmental Deminimis shall not apply to any claim or
series of claims related to a Remedial Action or an exposure or alleged exposure
to Hazardous Materials.

 
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ARTICLE V

CERTAIN ADJUSTMENTS

Section 5.01     Certain Adjustments.

(a)           Not less than four (4) Business Days prior to the earlier of (i)
the date on which the Debt Exchange is expected to commence; and (ii) the
anticipated Distribution Date, TDCC shall deliver to Spinco (with a copy to
Parent) a notice that sets forth TDCC’s good faith estimate of the Working
Capital Amount (the “Estimated Working Capital Amount”).

(b)           Within ninety (90) days after the Distribution Date, TDCC shall
prepare and deliver to Spinco the Initial Working Capital Statement.  Spinco
shall provide TDCC and its Representatives with reasonable access to the books,
records and personnel of the Business necessary for TDCC to prepare the Initial
Working Capital Statement.

(c)           At all reasonable times during the forty-five (45)-day period
immediately following Spinco’s receipt of the Initial Working Capital Statement,
Spinco and its Representatives shall be permitted to review the records of TDCC
relating to the Initial Working Capital Statement that are reasonably requested
by Spinco, and TDCC shall make reasonably available to Spinco and its
Representatives the individuals employed by TDCC and responsible for the
preparation of the Initial Working Capital Statement in order to respond to the
inquiries of Spinco related thereto.

(d)           Spinco shall deliver to TDCC by the Objection Deadline Date either
a notice indicating that Spinco accepts the Initial Working Capital Statement
(“Notice of Acceptance”) or a detailed statement describing each objection (with
reference to the applicable account description and item number as set forth on
Schedule 5.01) to the Initial Working Capital Statement and specifying the
amount that Spinco reasonably believes is the correct amount for each applicable
account description and item number (“Notice of Disagreement”); provided, that
any objections must be on the basis that the amounts set forth in the Initial
Working Capital Statement (i) were not determined in accordance with
Schedule 5.01; or (ii) were arrived at based on mathematical or clerical
error.  If Spinco delivers to TDCC a Notice of Acceptance, or if Spinco does not
deliver a Notice of Disagreement in accordance with this Section 5.01(d) on or
before the Objection Deadline Date, then, effective as of the earlier of the
date of delivery of such Notice of Acceptance and the Objection Deadline Date,
the Initial Working Capital Statement shall be deemed to be the Final Working
Capital Statement.  If Spinco timely delivers a Notice of Disagreement in
accordance with this Section 5.01(d), only those matters specified in accordance
with this Section 5.01(d) in such Notice of Disagreement shall be deemed to be
in dispute (the “Disputed Items”), and all other matters included in the Initial
Working Capital Statement shall be final, binding and conclusive upon the
parties hereto.

(e)           The Disputed Items shall be resolved as follows:

(i)           TDCC and Spinco shall first use their reasonable best efforts to
resolve such Disputed Items.

 
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(ii)           Any resolution by TDCC and Spinco as to such Disputed Items shall
be final and binding on the parties hereto.

(iii)           If TDCC and Spinco do not reach a resolution of all Disputed
Items within 60 days after delivery of the Notice of Disagreement, TDCC and
Spinco shall, within 60 days following the expiration of such 60-day period,
engage the Neutral Accountant, pursuant to an engagement agreement executed by
TDCC, Spinco and the Neutral Accountant, to resolve any Unresolved
Objections.  Unless the parties hereto agree otherwise, all communications
between TDCC and Spinco or any of their respective Representatives, on the
one hand, and the Neutral Accountant, on the other hand, shall be in writing
with copies simultaneously delivered to the non-communicating party.

(iv)           The Neutral Accountant shall be instructed to resolve the
Unresolved Objections in accordance with Schedule 5.01 and shall be instructed
not to independently investigate any other matters.  TDCC and Spinco shall
request that the Neutral Accountant make a final determination (which
determination shall set forth the reasons for such determination) of the Working
Capital Amount within 30 days from the date the Unresolved Objections were
submitted to the Neutral Accountant, and such final determination shall be
deemed the Final Working Capital Statement.  During the 30-day review by the
Neutral Accountant, TDCC and Spinco shall each make available to the Neutral
Accountant such individuals and such information, books and records as may be
reasonably required by the Neutral Accountant to make its final determination.

(v)           The resolution by the Neutral Accountant of the Unresolved
Objections shall be conclusive and binding upon the parties hereto.  The parties
hereto agree that the procedure set forth in this Section 5.01(e) for resolving
disputes with respect to the Initial Working Capital Statement and the Working
Capital Amount shall be the sole and exclusive method for resolving any such
disputes.

(vi)           The fees and expenses of the Neutral Accountant shall be
allocated between TDCC and Spinco in the same proportion that the aggregate
amount of such Unresolved Objections that is unsuccessfully disputed by each
such party hereto (as finally determined by the Neutral Accountant) bears to the
total amount of Unresolved Objections.

(f)           The Initial Working Capital Statement, including any modifications
resulting from the resolution of any Disputed Items set forth in the Notice of
Disagreement, shall be deemed to be the Final Working Capital Statement and be
binding on the parties hereto for the purposes of this Section 5.01 upon the
earliest to occur of (i) the delivery by Spinco of the Notice of Acceptance or
the failure of Spinco to deliver the Notice of Disagreement by the Objection
Deadline Date pursuant to Section 5.01(d); (ii) the resolution of all Disputed
Items by TDCC and Spinco pursuant to Section 5.01(e)(ii); and (iii) the
resolution of all Disputed Items pursuant to Section 5.01(e)(iv) by the Neutral
Accountant.  Within five Business Days after the Final Working Capital Statement
becomes or is deemed final and binding on the parties hereto, an adjustment to
the Special Payment and a payment by wire transfer in respect thereof described
below shall be made as follows:

 
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(i)           If the Working Capital Amount as shown on the Final Working
Capital Statement exceeds the Estimated Working Capital Amount (such difference,
the “Underpayment”) by an amount equal to at least $1,000,000, Spinco shall pay
to TDCC within five Business Days of the final determination of the Working
Capital Amount an amount equal to such Underpayment by wire transfer of
immediately available funds to a bank account designated in writing by TDCC
(such designation to be made at least three Business Days prior to the day on
which such payment is due).

(ii)           If the Working Capital Amount as shown on the Final Working
Capital Statement is less than the Estimated Working Capital Amount (such
difference, the “Overpayment”) by an amount equal to at least $1,000,000, TDCC
shall pay to Spinco within five Business Days of the final determination of the
Working Capital Amount an amount equal to such Overpayment by wire transfer of
immediately available funds to a bank account designated in writing by Spinco
(such designation to be made at least three Business Days prior to the day on
which such payment is due).

(iii)           For the avoidance of doubt, if the Underpayment or the
Overpayment described in clauses (i) or (ii) above is less than $1,000,000, then
the Special Payment shall not be adjusted and no payments shall be due under
this Section 5.01.

(g)           Any payment required to be made pursuant to this Section 5.01
shall bear interest from the Distribution Date through and including the date of
payment at the Interest Rate.

(h)           To the extent that any of the parties hereto or any of their
respective Affiliates have any obligation under this Agreement or any of the
other Transaction Documents to indemnify or to make any other payment, no amount
with respect to a matter to which such obligation or payment relates shall be
included in the calculation of the Working Capital Amount.  No amount with
respect to a matter shall be included more than once in the calculation of the
Working Capital Amount.

ARTICLE VI

CERTAIN OTHER MATTERS

Section 6.01     Access to Information.

(a)           In order to facilitate the resolution of any claims made against,
or incurred by, Dow relating to the Business and for purposes of compliance with
securities, environmental, employment and other Laws, until the later of the
seventh anniversary of the Distribution or the expiration of the relevant period
of the applicable statute of limitations (including any extension thereof),
Spinco shall, and shall cause the Parent Entities to, (i) retain the books and
records and financial and operational data relating to the Business, the
Transferred Assets and the Retained Sites for periods prior to the Distribution;
and (ii) upon reasonable notice, afford the Representatives of Dow reasonable
access (including the right to make, at Dow’s expense, copies), during normal
business hours, to such books and records.  After the expiration of such period,
Spinco shall offer to turn over possession of such books and records to Dow at
least 60 days prior to disposing of or destroying any of such books and records.

 
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(b)           In order to facilitate the resolution of any claims made against,
or incurred by, any of the Parent Entities relating to the Business and for
purposes of compliance with securities, environmental, employment and other
Laws, until the later of the seventh anniversary of the Distribution or the
expiration of the relevant period of the applicable statute of limitations
(including any extension thereof), TDCC shall (i) retain the books and records
and financial and operational data relating to the Business, the Transferred
Assets and the Retained Sites relating to periods prior to the Distribution,
which shall not otherwise have been made available to any of the Parent
Entities; and (ii) upon reasonable notice, afford the Representatives of Spinco
reasonable access (including the right to make, at Spinco’s expense, copies),
during normal business hours, to such books and records.  After the expiration
of such period, TDCC shall offer to turn over possession of such books and
records to Spinco at least 60 days prior to disposing of or destroying any of
such books and records.

(c)           Each of TDCC and Spinco acknowledges and agrees that any
information made available to a party or its Representatives pursuant to this
Section 6.01 shall be treated as confidential, in accordance with the terms of
the Confidentiality Agreement, for a period of three (3) years following the
date on which such information was provided or made available pursuant to this
Section 6.01.

Section 6.02     Privileged Matters.

(a)           The parties hereto acknowledge and agree that the Transferred
Subsidiaries’ attorney-client privilege, attorney work-product protection and
expectation of client confidence with respect to any communications concerning
any proposed sale of the Business or any other transaction contemplated by this
Agreement or any of the other Transaction Documents, and all information and
documents covered by such privilege, protection or expectation shall be retained
and controlled by Dow, and may be waived only by Dow.  TDCC and Spinco
acknowledge and agree that (i) the foregoing attorney-client privilege, work
product protection and expectation of client confidence shall not be controlled,
owned, used, waived or claimed by the Transferred Subsidiaries upon consummation
of the Distribution; and (ii) in the event of a dispute between a Parent Entity
and a third party or any other circumstance in which a third party requests or
demands that the Parent Entity produce privileged materials or attorney
work-product of a Dow Entity (including the privileged communications and
attorney work-product covered by this Section 6.02(a)), Spinco shall cause such
Parent Entity to assert such attorney-client privilege on behalf of the
applicable Dow Entity to prevent disclosure of privileged communications or
attorney work-product to such third party.

 
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(b)           The parties hereto acknowledge and agree that the attorney-client
privilege, attorney work-product protection and expectation of client confidence
with respect to any communications concerning general business matters related
to the Business and the Transferred Subsidiaries and arising prior to the
Distribution for the benefit of both Dow and the Transferred Subsidiaries shall
be subject to a joint privilege and protection between Dow, on the one hand, and
the Transferred Subsidiaries, on the other hand, and Dow and the Transferred
Subsidiaries shall have equal right to assert such joint privilege and
protection and no such joint privilege or protection may be waived by (i) Dow
without the prior written consent of such Transferred Subsidiary; or (ii) by any
Transferred Subsidiary without the prior written consent of Dow; provided,
however, that any such privileged communications or attorney-work product,
whether arising prior to, or after the Distribution Date, with respect to any
matter for which a party hereto has an indemnification obligation hereunder,
shall be subject to the sole control of such party, which shall be solely
entitled to control the assertion or waiver of the privilege or protection,
whether or not such communications or work product is in the possession of or
under the control of such party.  Notwithstanding the foregoing, the parties
hereto acknowledge and agree that Shearman & Sterling LLP and in-house counsel
of Dow represent only Dow and not the Transferred Subsidiaries and that (x) any
advice given by or communications with Shearman & Sterling LLP shall not be
subject to any joint privilege and shall be owned solely by Dow; and (y) any
advice given by or communications with in-house counsel of Dow (to the extent it
relates to any proposed sale of the Business or any other transaction
contemplated by this Agreement or any of the other Transaction Documents) shall
not be subject to any joint privilege and shall be owned solely by Dow.

Section 6.03     Conduct of Excluded Claims.

(a)           With respect to each Excluded Claim, the parties hereto hereby
agree that, (i) from and after the Distribution, Spinco shall, and shall cause
the other Parent Entities to, take such action, provide such reasonable
co-operation, information and assistance, and make available such personnel upon
reasonable notice (including to prepare for, and appear as witnesses at, any
proceedings), as TDCC may request in order for TDCC to (x) prosecute, join,
dispute, resist, appeal, compromise, settle, defend, remedy or mitigate the
Excluded Claim; or (y) enforce against any Person all or any rights of TDCC, or
the Parent Entities, in relation to the Excluded Claim; and (ii) in connection
with proceedings related to any Excluded Claim set forth on Annex I to Schedule
1.01(d), use advisers chosen by TDCC and, if TDCC requests, allow TDCC or an
Affiliate of TDCC to control the exclusive conduct of the proceedings; provided,
that TDCC shall, or shall procure that one of its Affiliates shall, reimburse
Spinco or the relevant Parent Entity for all reasonable, documented
out-of-pocket-costs incurred by it in relation to its actions taken pursuant to
this Section 6.03.

(b)           TDCC shall be entitled to, and from and after the Distribution,
Spinco shall, and shall cause the other Parent Entities to, pay to TDCC (or
another Dow Entity designated by TDCC), any amounts, consideration or other
benefits received by the Parent Entities in respect of each Excluded Claim,
including interest actually received that is attributable thereto, net of any
fees, costs and expenses which Spinco or the Parent Entities have actually
incurred in connection with each such Excluded Claim from and after the
Distribution Date.

 
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Section 6.04     Financial Information.  On or prior to the fifteenth (15th) day
following the close of the fiscal quarter of TDCC in which the Distribution
occurs (or, if the Distribution occurs less than thirty (30) days before the
close of such fiscal quarter, within forty-five (45) days after the Distribution
Date), each of Spinco and TDCC shall cause to be prepared and delivered to the
other party financial information with respect to the Business as may be
reasonably requested by such other party for the preparation of any reports that
are required to be filed by such party or its Affiliates with the SEC. 

Section 6.05     Retained Names and Marks; Rail Car Marks.

(a)           Spinco hereby acknowledges that all right, title and interest in
and to the “DOW”, “DOW CHEMICAL”, “THE DOW CHEMICAL COMPANY”, “ROHM AND HAAS”,
“UNION CARBIDE” and “UNION CARBIDE CORPORATION” names, together with all
variations and acronyms thereof and all trademarks, service marks, Internet
domain names, trade names, trade dress, company names and other identifiers of
source or goodwill containing or incorporating any of the foregoing, including
the Dow Diamond logo (i.e., [dow.jpg] ) (collectively, the “Retained Names and
Marks”), are owned exclusively by TDCC or its Affiliates, and that, except as
expressly provided below or in the Trademark License Agreement, any and all
right of the Transferred Subsidiaries to use the Retained Names and Marks shall
terminate as of the Distribution and shall immediately revert to TDCC, along
with any and all goodwill associated therewith; provided, however, that any use
by the Transferred Subsidiaries of the Retained Names and Marks consisting of
“DOWPER” shall be governed by the terms of the Trademark License Agreement and
nothing in clauses (b) – (f) of this Section 6.05 shall apply to the use of such
marks.  Spinco further acknowledges that none of the Transferred Subsidiaries
shall have any rights, or is acquiring any rights, to use the Retained Names and
Marks, except for the rights expressly provided herein and in the Trademark
License Agreement.

(b)           The Transferred Subsidiaries shall, for a period of 90 days after
the Distribution Date, be entitled to use, solely in connection with the
operation of the Business as operated immediately prior to the Distribution, all
of the existing stocks of signs, letterheads, labels, office forms, packaging,
invoice stock, advertisements and promotional materials, inventory and other
documents and materials (“Existing Stock”) that are included in the Transferred
Assets and contain the Retained Names and Marks, after which period Spinco
shall, and shall cause each Transferred Subsidiary to, remove or obliterate all
Retained Names and Marks from such Existing Stock or cease using such Existing
Stock; provided, however, that Spinco shall, and shall cause each Transferred
Subsidiary to, use commercially reasonable efforts to ensure that all such
Existing Stock used by it hereunder following the Distribution Date shall, to
the extent deemed practicable in Spinco’s reasonable judgment, display a notice,
in a format reasonably acceptable to TDCC, indicating that the Business (i) was
formerly owned by Dow; and (ii) is now owned and operated by the Transferred
Subsidiaries.

(c)           Except as expressly provided in this Section 6.05, no other right
to use the Retained Names and Marks is granted hereunder by Dow to the Parent
Entities whether by implication or otherwise, and nothing hereunder permits the
Parent Entities to use the Retained Names and Marks in any manner other than in
connection with Existing Stock.  Spinco shall, and shall cause each Transferred
Subsidiary to, ensure that all uses of the Retained Names and Marks as provided
in this Section 6.05 shall be only with respect to goods and services of a level
of quality equal to or greater than the quality of goods and services with
respect to which the Retained Names and Marks were used in the Business prior to
the Distribution.  Any and all goodwill generated by the use of the Retained
Names and Marks under this Section 6.05 shall inure solely to the benefit of
Dow.  Spinco shall not, and shall cause the other Transferred Subsidiaries not
to, (i) use the Retained Names and Marks hereunder in any manner that may
damage, impair or tarnish the reputation of Dow, the goodwill associated with
the Retained Names and Marks or Dow’s ownership of the Retained Names and Marks;
or (ii) contest the ownership or validity of any of the Retained Names and
Marks.

 
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(d)           Spinco agrees that Dow shall have no responsibility for claims by
third parties arising out of, or relating to, the use by the Transferred
Subsidiaries of any Retained Names and Marks after the Distribution Date.  In
addition to any and all other available remedies, Spinco shall indemnify and
hold harmless Dow and its Representatives, successors and assigns, from and
against any and all such claims that may arise out of the use of the Retained
Names and Marks by the Transferred Subsidiaries (i) in accordance with the terms
and conditions of this Section 6.05, other than such claims that the Retained
Names and Marks infringe the Intellectual Property rights of any third party; or
(ii) in violation of or outside the scope permitted by this Section
6.05.  Notwithstanding anything in this Agreement to the contrary, Spinco hereby
acknowledges that in the event of any breach or threatened breach of this
Section 6.05, TDCC, in addition to any other remedies available to it, shall be
entitled to a preliminary injunction, temporary restraining order or other
equivalent relief restraining the Transferred Subsidiaries from any such breach
or threatened breach.

(e)           Except as expressly provided in Section 6.05(b), Spinco shall not,
and shall cause each Transferred Subsidiary not to, hold itself out as having
any affiliation or association with Dow, other than as may be required by
applicable Law or stock exchange requirement or in connection with describing
the historical relationship of such entities with Dow.  Spinco acknowledges that
the use by the Transferred Subsidiaries of the Retained Names and Marks pursuant
to Section 6.05(b) shall not be deemed an endorsement by Dow of their products
or services, nor be deemed an affiliation between the parties hereto or their
Affiliates.

(f)           In connection with the use of any Leased Rail Cars or Owned Rail
Cars, Spinco shall, and shall cause the other Transferred Subsidiaries to, as
promptly as possible and, in any event, no later than nine (9) months after the
Distribution Date, use their reasonable best efforts to (i) remove and cease use
of all trademarks or other indicators of source or origin (“Rail Car Marks”)
owned or controlled by Dow, including Retained Names and Marks, that are affixed
to any such rail cars as of the Distribution Date; (ii) obtain new Rail Car
Marks with RailInc, which process shall, in any event, be commenced no later
than twenty (20) days after the later of the Distribution Date or the transfer
of each such rail car to a Transferred Subsidiary; (iii) re-stencil all such
rail cars and reprogram each Automatic Equipment Identification tag on such rail
cars, in each case, after the new Rail Car Marks have been obtained and, in any
event, prior to such rail cars being laden for subsequent trips; and
(iv) provide Dow with a list of such new Rail Car Marks, which list shall
include cross references to Dow’s former Rail Car Marks for each such rail car;
provided, however, that if and to the extent TDCC elects, prior to the
Distribution Date, to cause any Leased Rail Cars or Owned Rail Cars to have its
Rail Car Marks changed to reflect operation by one or more of the Transferred
Subsidiaries, then this Section 6.05(f) shall not apply.

 
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Section 6.06     Insurance Matters.  From and after the Distribution Date, the
DCP Group and the Business shall cease to be insured by Dow’s insurance policies
or by any of its self-insured programs.  For the avoidance of doubt, Dow shall
retain all rights to control its insurance policies and programs, including the
right to exhaust, settle, release, commute, buy back or otherwise resolve
disputes with respect to any of its insurance policies and programs
notwithstanding whether any such policies or programs apply to any Liabilities
of the Transferred Subsidiaries.  Spinco agrees to arrange for its own insurance
policies with respect to the Business and the DCP Group covering all periods and
agrees not to seek, through any means, to benefit from any Dow Entity’s
insurance policies that may provide coverage for claims relating in any way to
the Business or the DCP Group prior to the Distribution.

Section 6.07     Intercompany Accounts and Arrangements.  TDCC shall use
commercially reasonable efforts to take, and to cause one or more of its
Subsidiaries to take, to the extent permitted by Law, such action as is
necessary and advisable to settle, or have assigned to or assumed by a Retained
Dow Entity, effective as of or prior to the Distribution Date, all intercompany
accounts between a Transferred Subsidiary, on the one hand, and a Retained Dow
Entity, on the other hand.  TDCC shall take, and cause one or more of its
Subsidiaries to take, to the extent permitted by Law, such action as is
necessary and advisable to terminate all intercompany arrangements and
agreements (other than the Transaction Documents), whether written or oral,
providing for the leasing or licensing of goods, services, tangible or
intangible properties or joint activities among a Retained Dow Entity, on the
one hand, and the Transferred Subsidiaries, on the other hand; provided, that
the parties hereto agree that TDCC, in its sole and absolute discretion may,
prior to the Distribution, settle or terminate intercompany accounts or
intercompany agreements among the Transferred Subsidiaries; provided, further,
that intercompany accounts not settled, assigned or assumed pursuant to this
Section 6.07 shall be taken into account for the determination of the Working
Capital Amount pursuant to Schedule 5.01.

Section 6.08     Apportionment of Periodic Payments and Receipts.  All periodic
cash payments and receipts of the Business or related to the Transferred Assets
or Assumed Liabilities, including rents, royalties, refunds, commissions,
expenses and other payments or receipts, shall be apportioned on a time basis,
except with respect to (a) gas, electricity, telephone, water and other
utilities charges, which shall be apportioned on a usage basis; and (b) rebates,
which shall be apportioned based on sales quantities or other factors on which
the value of the respective rebate is based, so that the part of the relevant
payment or receipt that is attributable to the period ending on the Distribution
Date shall be for the account of Dow and such part of the relevant amount
attributable to the period commencing immediately following the Distribution
Date shall be for the account of the applicable Parent Entity.  No payment shall
be made under this Section 6.08 to the extent the amount to which such payment
relates (x) has been taken into account in the calculation of the Working
Capital Amount under Section 5.01; or (y) is an amount payable or indemnifiable
under any other provision of this Agreement, including Article IV or under any
provision of the other Transaction Documents.

Section 6.09     Bulk Sales Laws.  Each party hereto hereby waives compliance by
each member of its Group with the requirements and provisions of the “bulk-sale”
or “bulk-transfer” Laws of any jurisdiction that may otherwise be applicable
with respect to any of the transactions contemplated in this Agreement.

 
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Section 6.10     Further Actions.

(a)           On the Distribution Date, each of TDCC and Spinco shall, or shall
cause their applicable Subsidiaries to, execute and deliver each of the
Transaction Documents identified on Schedule 1.01(j) in substantially the forms
attached hereto as Exhibits C – EEE, respectively.  Except as otherwise provided
in this Agreement, the parties hereto shall, and shall cause their respective
Affiliates to, use their reasonable best efforts to take, or cause to be taken,
all appropriate action, to do, or cause to be done, and to assist and cooperate
with the other parties hereto in doing, all things necessary, proper or
advisable under applicable Law to execute and deliver the Transaction Documents
and such other documents and other papers as may be required to carry out the
provisions of this Agreement and to consummate and make effective the
transactions contemplated by this Agreement.  The parties hereto hereby
acknowledge and agree that the Transaction Documents that are identified on
Schedule 1.01(j) are in agreed form and shall not be the subject of further
change or negotiation, except (i) to correct manifest errors or to ensure
consistency of terms of Transaction Documents dealing with the same subject
matter and the creation or completion of exhibits or schedules thereto; or
(ii) as otherwise expressly provided in Schedule 1.01(j), in each case subject
to Parent’s prior written approval, and none of such changes will alter
fundamental economic terms, including the scope, consideration, liabilities or
risk allocation.  TDCC and Spinco agree that each Local Conveyance shall be in a
form that reflects the terms and conditions of this Agreement with such
provisions as are required by applicable Law in the jurisdiction in which the
relevant assets or Liabilities are located and otherwise reasonably satisfactory
to Parent; provided, that TDCC and Spinco may cause the Local Conveyances to be
executed at the time of the Internal Separation, and if and to the extent that a
Local Conveyance does not reflect the terms and conditions of this Agreement,
TDCC and Parent shall cooperate in good faith to amend such Local Conveyance
prior to the Distribution Date to reflect the terms and conditions of this
Agreement.

(b)           Subject to Section 2.01(d) and Section 2.01(e), from time to time
after the Distribution Date, without additional consideration, each party hereto
shall, and shall cause its Affiliates to, execute and deliver such further
instruments and take such other action as may be necessary or is reasonably
requested by another party hereto to make effective the transactions
contemplated by this Agreement and the other Transaction Documents.  Without
limiting the foregoing, upon reasonable request of a party hereto, the other
party shall, and shall cause its respective Affiliates to, execute, acknowledge
and deliver all such further assurances, deeds, assignments, consequences,
powers of attorney and other instruments and papers as may be required for the
transfer to a Transferred Subsidiary of direct or indirect ownership of the
Transferred Assets and the Transferred JV Interests and the assumption by the
Transferred Subsidiaries of the Assumed Liabilities, as contemplated by this
Agreement.

ARTICLE VII

DISCLAIMER

Section 7.01     Disclaimer.  EXCEPT AS MAY EXPRESSLY BE SET FORTH IN ANY
TRANSACTION DOCUMENT, ALL TRANSFERRED ASSETS ARE BEING TRANSFERRED ON AN “AS
IS,” “WHERE IS” BASIS AND THE PARTIES HERETO SHALL EACH BEAR THEIR RESPECTIVE
ECONOMIC AND LEGAL RISKS TO THE EXTENT RESULTING FROM (A) ANY CONVEYANCE BEING
INSUFFICIENT TO VEST IN THE TRANSFEREE GOOD TITLE, FREE AND CLEAR OF ANY
ENCUMBRANCE; (B) ANY FAILURE TO OBTAIN ANY NECESSARY CONSENTS OR APPROVALS OF
ANY THIRD PARTIES OR GOVERNMENTAL AUTHORITIES; AND (C) ANY FAILURE TO COMPLY
WITH THE REQUIREMENTS OF ANY LAW.

 
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Section 7.02     Limitation of Liability.  IN NO EVENT SHALL ANY PARTY OR ANY
OTHER MEMBER OF ANY GROUP BE LIABLE TO ANY OTHER PARTY OR ANY MEMBER OF ANOTHER
GROUP FOR PUNITIVE, CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES, INCLUDING LOSS
OF FUTURE PROFITS, REVENUE OR INCOME, DIMINUTION IN VALUE OR LOSS OF BUSINESS
REPUTATION OR OPPORTUNITY, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY
(INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, REGARDLESS OF
WHETHER SUCH DAMAGES WERE FORESEEABLE OR SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES EXCEPT TO THE EXTENT AWARDED BY A COURT OF COMPETENT
JURISDICTION IN CONNECTION WITH A THIRD-PARTY CLAIM.

ARTICLE VIII

GENERAL PROVISIONS

Section 8.01     Survival of Covenants.  None of the covenants or agreements
contained in this Agreement shall survive the Distribution Date, other than
those which by their terms contemplate performance after the Distribution Date
and such surviving covenants and agreements shall survive the Distribution Date
only until the expiration of the term of the undertaking set forth in such
covenants and agreements; provided, however, that any claim made with reasonable
specificity by the party seeking to be indemnified within the time periods set
forth in this Section 8.01 shall survive until such claim is finally resolved.

Section 8.02     Expenses.  Except as otherwise specified in this Agreement, all
costs and expenses, including fees and disbursements of counsel, financial and
other advisors and accountants, incurred in connection with this Agreement and
the transactions contemplated by this Agreement shall be borne by the party
incurring such costs and expenses, whether or not the transactions contemplated
herein shall have occurred.

Section 8.03     Notices.  All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by an internationally recognized overnight courier service,
or by facsimile (with a confirmatory copy sent by an internationally recognized
overnight courier service) to the respective parties hereto at the following
addresses (or at such other address for a party as shall be specified in a
notice given in accordance with this Section 8.03):

 
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(a)
if to TDCC and, on or prior to the Distribution Date, to Spinco:
         
The Dow Chemical Company
   
2030 Dow Center
   
Midland, Michigan 48674
   
Facsimile:
(989) 638-9397
   
Attention:
Executive Vice President and General Counsel
         
with a copy to:
         
Shearman & Sterling LLP
   
599 Lexington Avenue
   
New York, New York 10022-6069
   
Facsimile:
(212) 848-7179
   
Attention:
George A. Casey, Esq.
     
Heiko Schiwek, Esq.
         
in the case of Spinco, with a copy to:
         
Olin Corporation
   
190 Carondelet Plaza, Suite 1530
   
Clayton, Missouri 63105-3443
   
Facsimile:
(314) 480-1484
   
Attention:
Senior Vice President and General Counsel
         
with a copy to:
         
Cravath, Swaine & Moore LLP
   
Worldwide Plaza
   
825 Eighth Avenue
   
New York, NY 10019
   
Facsimile:
(212) 474-3700
   
Attention:
Robert I. Townsend, III, Esq.
     
George F. Schoen, Esq.
       
(b)
if, following the Distribution Date, to Spinco:
         
Olin Corporation
   
190 Carondelet Plaza, Suite 1530
   
Clayton, Missouri 63105-3443
   
Facsimile:
(314) 480-1484
   
Attention:
Senior Vice President and General Counsel
     

 
 
 
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with a copy to:
         
Cravath, Swaine & Moore LLP
   
Worldwide Plaza
   
825 Eighth Avenue
   
New York, NY 10019
   
Facsimile:
(212) 474-3700
   
Attention:
Robert I. Townsend, III, Esq.
     
George F. Schoen, Esq.

 
Section 8.04     Public Announcements.  None of the parties to this Agreement
shall make, or cause to be made, any press release or public announcement in
respect of this Agreement, the other Transaction Documents or the transactions
contemplated hereby and thereby or otherwise communicate with any news media
regarding this Agreement, the other Transaction Documents or the transactions
contemplated hereby and thereby without the prior written consent of the other
parties hereto, unless such press release or public announcement is required by
Law or applicable stock exchange regulation, in which case the parties to this
Agreement shall, to the extent practicable, consult with each other as to the
timing and contents of any such press release, public announcement or
communication; provided, however, that the prior written consent of the other
parties shall not be required hereunder with respect to any press release,
public announcement or communication that is substantially similar to a press
release, public announcement or communication previously issued with the prior
written consent of the other parties.

Section 8.05     Severability.  If any term or other provision of this Agreement
is declared invalid, illegal or incapable of being enforced by any Governmental
Authority, all other terms and provisions of this Agreement shall nevertheless
remain in full force and effect for so long as the economic or legal substance
of the transactions contemplated by this Agreement is not affected in any manner
materially adverse to any party hereto.  Upon such determination that any term
or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties hereto as closely as possible in a
mutually acceptable manner in order that the transactions contemplated by this
Agreement are consummated as originally contemplated to the greatest extent
possible.

Section 8.06     Entire Agreement.  This Agreement, the Dow Disclosure Letter,
the Merger Agreement, the Disclosure Letters, the other Transaction Documents
and the Confidentiality Agreement constitute the entire agreement of the parties
hereto with respect to the subject matter hereof and thereof and supersede all
prior agreements and undertakings, both written and oral, among the parties
hereto with respect to the subject matter hereof and thereof.

Section 8.07     Assignment.  This Agreement and the rights and obligations
hereunder may not be assigned by operation of Law or otherwise without the
express written consent of TDCC and Spinco, as the case may be (which consent
may be granted or withheld in the sole discretion of TDCC or Spinco, subject to
the prior written consent of Parent in accordance with Section 7.15 of the
Merger Agreement), and any attempted assignment that is not in accordance with
this Section 8.07 shall be null and void.

 
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Section 8.08     Amendment.  This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, each party
hereto that expressly references the Section of this Agreement to be amended; or
(b) by a waiver in accordance with Section 8.09, in each case subject to the
prior written consent of Parent in accordance with Section 7.15 of the Merger
Agreement.

Section 8.09     Waiver.  Any party to this Agreement may (a) extend the time
for the performance of any of the obligations or other acts of the other
parties; (b) waive any inaccuracies in the representations and warranties of the
other parties contained herein or in any document delivered by the other parties
pursuant to this Agreement; or (c) waive compliance with any of the agreements
of the other parties or conditions to such obligations contained herein.  Any
such extension or waiver, by either party, and any consent, approval,
authorization or similar action to be taken by Spinco under this Agreement,
shall be subject to the prior written consent of Parent in accordance with
Section 7.15 of the Merger Agreement.  Any such extension or waiver shall be
valid only if set forth in an instrument in writing signed by the parties to be
bound thereby.  Notwithstanding the foregoing, no failure or delay by any party
hereto in exercising any right hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or future
exercise of any other right hereunder.  Any waiver of any term or condition
hereof shall not be construed as a waiver of any subsequent breach or as a
subsequent waiver of the same term or condition, or a waiver of any other term
or condition of this Agreement.

Section 8.10     No Third-Party Beneficiaries.  This Agreement shall be binding
upon and inure solely to the benefit of, and be enforceable by, only the parties
hereto and their respective successors and permitted assigns and nothing herein,
express or implied, is intended to, or shall confer upon, any other Person any
right, benefit or remedy of any nature whatsoever, including any rights of
employment for any specified period, under or by reason of this Agreement;
provided, however, that Parent shall be a third-party beneficiary of this
Agreement and shall have the right to enforce the terms and provisions hereof.

Section 8.11     Specific Performance.  The parties hereto acknowledge and agree
that the parties hereto would be irreparably damaged if any of the provisions of
this Agreement are not performed in accordance with their specific terms or are
otherwise breached and that any non-performance or breach of this Agreement by
any party hereto could not be adequately compensated by monetary damages
alone and that the parties hereto would not have any adequate remedy at
law.  Accordingly, in addition to any other right or remedy to which any party
hereto may be entitled, at law or in equity (including monetary damages), such
party shall be entitled to enforce any provision of this Agreement by a decree
of specific performance and to temporary, preliminary and permanent injunctive
relief to prevent breaches or threatened breaches of any of the provisions of
this Agreement, without posting any bond or other undertaking.  The parties
hereto agree that they will not contest the appropriateness of specific
performance as a remedy.

Section 8.12     Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware.  Except (a) as
provided in Section 5.01; and (b) with respect to Actions arising under another
Transaction Document that does not incorporate the dispute resolution provisions
contained in this Agreement, all Actions that, directly or indirectly, arise out
of or relate to this Agreement shall be heard and determined exclusively in the
Court of Chancery of the State of Delaware; provided, however, that if such
court does not have jurisdiction over such Action, such Action shall be heard
and determined exclusively in any Delaware state court or United States federal
court sitting in the State of Delaware.  Consistent with the preceding sentence,
each of the parties hereto hereby (i) submits to the exclusive jurisdiction of
any federal or state court sitting in the State of Delaware for the purpose of
any Action brought by any party hereto that, directly or indirectly, arises out
of or relates to this Agreement; (ii) agrees that service of process in such
Action will be validly effected by sending notice in accordance with Section
8.03; (iii) irrevocably waives and releases, and agrees not to assert by way of
motion, defense, or otherwise, in or with respect to any such Action, any claim
that (A) such Action is not subject to the subject matter jurisdiction of at
least one of the above-named courts; (B) its property is exempt or immune from
attachment or execution in the State of Delaware; (C) such Action is brought in
an inconvenient forum; (D) the venue of such Action is improper; or (E) this
Agreement or the transactions contemplated by this Agreement may not be enforced
in or by any of the above-named courts; and (iv) agrees not to move to transfer
any such Action to a court other than any of the above-named courts.

 
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Section 8.13     Waiver of Jury Trial.  EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION OR LIABILITY, DIRECTLY
OR INDIRECTLY, ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.  EACH OF THE PARTIES HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY
SUCH ACTION OR LIABILITY, SEEK TO ENFORCE THE FOREGOING WAIVER; AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 8.13.

Section 8.14     Termination.  Without any further action, this Agreement shall
terminate simultaneously with the valid termination of the Merger Agreement
prior to the Distribution, and if this Agreement is terminated, in no event
shall any party hereto be liable to the other party hereto or any other Person
under, or in respect of, this Agreement, except as provided in the Merger
Agreement.

Section 8.15     Conflict with Another Transaction Document.  If there is any
conflict between this Agreement and another Transaction Document (other than the
Merger Agreement), each of this Agreement and the other Transaction Document is
to be interpreted and construed, if possible, so as to avoid or minimize such
conflict, but, to the extent (and only to the extent) of such conflict, this
Agreement shall prevail and control.

Section 8.16     Counterparts.  This Agreement may be executed and delivered
(including by facsimile or other means of electronic transmission, such as by
electronic mail in “pdf” form) in two or more counterparts, and by the different
parties hereto in separate counterparts, each of which when executed shall be
deemed to be an original, but all of which taken together shall constitute
one and the same agreement.

[Signature page follows]

 
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as of the date first written above by its respective officers thereunto
duly authorized.
 

  THE DOW CHEMICAL COMPANY          
 
By:
/s/ James R. Fitterling        Name:  James R. Fitterling        Title:    Vice
Chairman, Business Operations          

 
 

  BLUE CUBE SPINCO INC.          
 
By:
/s/ Stephen J. Doktycz        Name:  Stephen J. Doktycz       Title:    Vice
President          

 

 
 
[Signature Page to Separation Agreement]