UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF MICHIGAN
NORTHERN DIVISION

In re: DOW CORNING CORPORATION,
Debtor,

____________________________________)
Case No. 95-20612
Chapter 11

ORDER REGARDING TERM SHEET, SCHEDULING HEARING DATE AND RE-APPOINTING MEDIATOR

This matter came before the Court on July 7, 1998, upon the submission of letters from the Debtor, The Official Committee of Tort Claimants, the Dow Chemical Company and Corning Incorporated informing the Court that they have accepted the provisions of a term sheet proposed by the Court-appointed mediator. The $3.2 billion agreement provides more funding, available earlier, then did previous proposals by the Debtor in order to insure that claims can be paid at the rate they are approved. The settlement provides breast implant claimants with a range of settlement options essentially replicating the Revised Settlement Plan ("RSP") arising from MDL 926 in Birmingham, Alabama. Breast implant claimants may also be able to qualify for more than one settlement option. For example, a claimant might qualify to obtain payments for explantation surgery in addition to payments for implant rupture and for specified medical conditions. Payments equal to to the amounts provided for in the RSP will be guaranteed to settling breast implant claimants. In general, after payment in full of guaranteed payments, the Debtor will pay a premium of up to 20% over the original settlement amounts. All personal injury claimants will retain their rights to settle or to litigate their claims. Any dispute concerning the language of the term sheet shall be determined by the Court.

Since the term sheet does not address issues between the Debtor and other parties, such as commercial creditors, health insurers and other non-personal claimants (collectively, the "non-personal injury claimants"), IT IS HEREBY ORDERED that the following procedures shall be implemented to facilitate the resolution of issues between the Debtor and the non-personal injury claimants and to facilitate the submission of a fully consensual plan:

1. Francis E. McGovern is reappointed as mediator, effective July 1, 1998, to assist the parties in converting the term sheet into a plan of reorganization, disclosure statement and any other necessary supporting documents. To the extent that the parties are unable to reach agreement regarding the content or drafting of these documents, the mediator shall submit such disputes forthwith to the Court. The mediator shall assist in resolving the remaining issues between the Debtor and non-personal injury claimants and shall assist all of the parties in expeditiously preparing and filing plan documents on or before August 20, 1998.

2. The mediator shall report to the Court weekly concerning the ongoing status of negotiations except that the mediator shall not disclose the substantive positions of the parties.

3. During the remaining settlement negotiations, the details of the term sheet and the plan documents shall remain confidential.

4. The mediator shall be entitled to reasonable compensation and reimbursement of necessary expenses from the Debtor's estate in accordance with the Second Amendment Case Management and Administrative Order.

IT IS FURTHER ORDERED that a hearing shall take place before this Court on August 20, 1998 at 9:30 A.M., in the Bankruptcy Courtroom, 111 First Street, Bay City, Michigan.

Dated: July 8, 1998.

ARTHUR J. SPECTOR
U.S. Bankruptcy Judge