SITE DEVELOPMENT AGREEMENT
This SITE DEVELOPMENT AGREEMENT entered into as of February 17, 1997
is by and between THE DOW CHEMICAL COMPANY ("TDCC") and DESTEC ENERGY, INC.
("Destec").
RECITALS:
A. TDCC and its direct and indirect wholly owned subsidiaries own and
operate manufacturing sites in the United States and other countries;
B. A number of Dow's manufacturing sites have the need for on-site
electrical power and steam generation;
C. Destec has a global capability to design, construct and operate
facilities that generate electrical power and steam;
D. Destec desires the opportunity to be included in the bid process in
the event Dow decides to utilize third parties (energy companies) to build
electric power and steam generation facilities at a Dow manufacturing site.
NOW, THEREFORE, the parties agree as follows:
1. DEFINITIONS
1.1 "Agreement" means this Site Development Agreement.
1.2 "Destec" has the meaning stated in the preamble.
1.3 "Dow" means TDCC and its wholly owned subsidiaries. The term
"third parties", when used in this Agreement, does not include any Dow entity.
1.4 "Effective Time" has the same meaning ascribed to that term in the
Agreement and Plan of Merger, dated February 17, 1997, by and among Destec,
Dow, NGC Corporation and NGC Acquisition Corporation II.
1.5 "Energy Generation Facility" means a new, or replacement of
substantially all of a, facility designed and constructed to generate at
least 15 megawatts of electricity on a continuous basis and/or at least
100,000 lbs. per hour of steam (as a product of the cogeneration of electricity)
for use in one or more Dow manufacturing processes at a Site. Refurbishment,
maintenance (even though extensive), and modifications to existing facilities
are not included in the definition of Energy Generation Facility.
1.6 "Site" means a current or planned manufacturing location owned
by Dow which has or will have continuous electrical power demands in excess of
15 megawatts per hour and/or process steam demands in excess of 100,000 lbs.
per hour under normal operating conditions.
1.7 "TDCC" has the meaning stated in the preamble.
2. TERM
The term and effectiveness of this Agreement begin at the Effective Time
and expire five years from the Effective Time.
3. NOTIFICATION AND INVITATION TO BID
3.1 During the term of this Agreement, Dow will include Destec in the Dow
notification to potential third party (power company) bidders with respect to
all Energy Generation Facility projects at a Site put to bid and invite Destec
to participate in the bid process.
3.2 In the event Destec elects to participate in the bidding process,
Destec will follow the applicable bidding process procedure. Other than the
preferential notice and invitation to bid as provided in Section 3.1, Destec
will compete on a level playing field with all other bidders.
3.3 In the event that Dow does not provide notification and an invitation
to bid (however captioned at the time) to Destec according to Section 3.1, Dow
will pay Destec the amount of damages which Destec shows it suffered up to a
cap of $25,000 per project. Notwithstanding the foregoing, the amount of
damages suffered by Destec shall in no way include damages suffered by any
other entity pursuant to Section 4.2.
4. NONASSIGNABILITY
4.1 Except as otherwise expressly stated elsewhere in this Agreement,
neither party to this Agreement may assign this Agreement or any part of this
Agreement to a third party without the prior written consent of the other
party, which consent may be withheld at the party's sole discretion.
4.2 Notwithstanding Section 4.1, Destec may provide the notification
referred to in Section 3.1, with respect to projects outside the United States
of America, to The AES Corporation and then either Destec and/or The AES
Corporation may submit a bid with respect to such projects under the terms and
conditions set forth in this Agreement. The failure of Dow to provide
notification and an invitation to bid shall in no way expand the amount of
damages which Destec may claim pursuant to Section 3.3 and shall not provide
any obligation on the part of Dow with respect to any entity other than Destec
pursuant to Section 3.3.
5. NOTICE
5.1 Any notice, request or communication specifically provided for or
permitted to be given under this Agreement must be in writing and may be
delivered by hand delivery, mail, courier service, or electronic transmission
such as Telex, facsimile, telegram or electronic mail, and shall be deemed
effective upon receipt. For purposes of notice the addresses of the parties are:
If to TDCC:
The Dow Chemical Company
Business Director, Energy
000 X. Xxx Xxxxxxx Xxxxxxx X.
Xxxxxxx, XX 00000
Facsimile: 000-000-0000
with a copy to:
The Dow Chemical Company
Manager, Power & Utilities Tech Center
Xxxxxxxx, XX 00000
Facsimile: 000-000-0000
If to DESTEC:
Destec Energy, Inc.
Attention: General Counsel
0000 XxxxXxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Facsimile: 000-000-0000
5.2 Each party may change its address and its representative for notice
by the giving of written notice of the change to the other party.
6. ENTIRE AGREEMENT
6.1 This Agreement constitutes the entire agreement between the parties
relating to the specific subject matter set forth in this Agreement. There are
no terms, obligations, covenants, representations, statements or conditions
other than those specifically noted or referred to in this Agreement.
Modifications of this Agreement must be made in accordance with Section 7 below.
7. MODIFICATION OF AGREEMENT
7.1 The parties agree that this Agreement may be modified only upon mutual
assent and that any and all agreements made by the parties to amend, extend,
revise or discharge this Agreement, in whole or in part and on one or more
occasions, shall not be invalid or unenforceable because of a lack of
consideration, provided any such amendments, extensions, revisions or
discharges of this Agreement are in writing, captioned as an amendment to
this Agreement and executed by the parties.
8. CONSTRUCTION
8.1 THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL
BE GOVERNED BY THE LAWS OF MICHIGAN BOTH AS TO INTERPRETATION AND PERFORMANCE,
WITHOUT REGARD TO ITS CONFLICT OF LAWS PROVISIONS. THE PARTIES AGREE THAT ANY
DISPUTES UNDER THIS AGREEMENT SHALL BE SUBMITTED TO THE COURTS IN THE STATE
OF MICHIGAN, AND NO OTHER VENUE.
This Agreement has been duly executed by authorized representatives of
the parties.
THE DOW CHEMICAL COMPANY
By: /s/ X.X. Xxxxxxxxx
----------------------------------
Name: X.X. Xxxxxxxxx
Title: Corporate Director, Mergers
& Acquisitions
DESTEC ENERGY, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
