Project Apollo - 65MW Plant

20-Mar-07 Oregon CAPEX Equipment Facilities Building Land A&E / CoordinationFees Total CAPEX (65MW) Total CAPEX ($1W) Support Grant (Gov.) Loan (Gov.) Developer Finance (Pry.) Total Support Net CAPEX with Grants ($1W) Dilution (in million shares) ESLR 1st Year Build Cost Shares qii2 $10 Loan Repayment $15 Total Dilution (in M) OPEX Electric Labor Rent Interest (Gov) Coordination Costs Federal Tax Savings I Tax Credit Prop Tax Total Annual OPEX (65MW) Net Operating (7yr discounted) Total State Specific Expenditure Massachusetts

Likely Scenario
Mexicali New Mexico New York*

$87.0 $35.0 $15.0 $2.0 $13.0 $152.0 $2.34

$87.0 $35.0 $15.0 $0.0 $10.0 $147.0 $2.26

$87.0 $30.0 $7.0 $1.0 $13.0 $138.0 $2.12

$87.0 $35.0 $15,0 . $2.5 $10.5 $150.0 $2.31

$87 0 $17.5 $0.0 $0.0 $8 0 $112.5 $1.73

$14.0 $0.0 $19.0 $33.0 $2.12

$23.6 $17.5 $0.0 $41.1 $1.90

$16.0 $25.0 $15.0 $56.0 $1.88

$23.0 $0.0 $46.0 $69.0 $1.95

$20.0 $32.0 $20.0 $72.0 $1.42

$119.0 11.9 1.3 13.2

$105.9 10.6 1.2 11.8

$82.0 8.2 2.7 10.9

$81.0 8.1 31 11.2

$40.5 4.1 3.5 7,5 .

($3.0) ($12.8) ($1.8) $0.0 ($1.0) $0.0 ($0.9) ($19.5) (t.94.8) ($213.8)

($6.3) ($13.6) $0.0 ($0.7) $0.0 $0.0 ($0.8) ($21.4) ($104.4) ($210.3)

($7.2) ($4.1) ($1.5) ($2.1) ($2.0) $4.5 ($0.6) ($12.9) ($62.8) ($144.8)

($3.8) ($10.7) ($4.5) $0.0 ($1.0) $1.2 ($0.5) ($19.3) ($94.1) ($175.1)

($5.8) ($122) ($2.0) ($1.6) ($1.0) $0.0 $0.0 ($22.5) ($109.7) ($150.2)

* New York offer only valid for tenancy at IBM Fishkill location on long term lease.

Evergreen Solar Backgrounder April 10, 2007 The Company Evergreen Solar, Inc., founded in 1994, develops, manufactures and markets solar photovoltaic (PV) power products primarily PV wafers, cells, and modules for residential and commercial use. Between 2004 and 2005, company revenues increased 87%, to $44 million. The company currently employs 310 workers at its headquarters and pilot manufacturing facilities in Marlborough. The company employs a "string ribbon" technology, allowing it to use less silicon more efficiently to manufacture PV cells. The Expansion Opportunity The company plans to invest $150,000,000, for a 225,000 s.f. manufacturing facility supporting 350 new manufacturing jobs. The Massachusetts Office of Business Development (MOBD) has aggressively encouraged the company to locate in Massachusetts. MOBD assembled a competitive incentives proposal (summary is attached) including grants, infrastructure funding, tax exemptions, and financing to convince the company to expand here. The company informed MOBD that the tax and financing aspects of the proposal are competitive with other states, and that that only Oregon significantly exceeds the state's grant offerings. MOBD proposed locating the facility on state owned land adjacent to the Massachusetts Technology Collaborative facility in Westborough. In this approach, the company will enter into a long-term lease with MTC, who will own the land and function as the landlord. This option is highly desirable to the company for many reasons, including: Benefits of the MTC-adjacent site to the company Greater utility of state infrastructure grants to the project. The site allows for use of MORE Jobs program funds (and possibly other grants) to address infrastructure needs on the parcel, which would otherwise (on a private parcel) not be eligible. We expect the company to apply and be competitive in this process. Proximity. The company values the close proximity of the Westborough site to their Marlborough headquarters. The new site will be just 10 minutes away from the company's top decision-makers and pilot manufacturing engineers. The location also provides close proximity to the Massachusetts Technology Collaborative (MTC), whose Renewable Energy Trust (RET) leads efforts to promote renewable energy adoption in our state.

Benefits of the MTC-adjacent site to Westborough

Significant potential tax benefits for Westborough. The estimated incremental value of this new facility will generate approximately $546,000 in new property tax revenues per year.

Evergreen Solar Backgrounder April 10, 2007 MOBD thinking "outside the box" to solve a problem Special legislation is needed to convey 5% Investment Tax Credit (ITC) benefits to the project. Westborough is not an Economic Target Area (ETA) municipality. As such, it cannot grant tax increment financing (TIF) to a job-creating project, as part of the Economic Development Incentive Program (EDIP). Also, without the TIF, the project is not eligible for the 5% ITC. The 5% ITC is very important to Evergreen Solar, as it is more valuable than the standard 3% ITC offered to manufacturers not participating in the EDIP. Also, the 5% ITC provides generous carry-forward provisions that the company could exercise in future years. Through special legislation, the state can provide the 5% ITC and its carry-forward provisions to companies meeting specific criteria. Status EOHED will draft special legislation language that will make the 5% ITC available to Evergreen Solar in Westborough.

Breakout of which funds are specifically for Evergreen/which are "standard"

* The incentive package that was offered to Evergreen is robust and creative. The MOBD team used the programs at their disposal and when that was exhausted they tapped into their relationships with private industry to make the package even more compelling. The is a great example of how I would like to see the government and private industry working toward common goals that benefit the Commonwealth of Massachusetts in it's entirety. * As we talk about the proposal I would like make special note that the majority of the programs in the proposal are available for all companies to access. We did create special one time incentives for Evergreen and this was to acknowledge their commitment to the Commonwealth. Of the $87M proposal $70 + M is from other programs for other companies to access.

EVERGREEN Special financing/savings vs public programs Special financing/savings specific to Evergreen Massachusetts Technology Collaborative Special Grant Land Cost Savings 5% Investment Tax Credit

$10,000,000 $ 3,000,000 $ 5,000,000

Narrower Public Programs included in the Evergreen package Massachusetts

Evergreen Solar Backgrounder April 10, 2007

Technology Collaborative LORI Grant $ 5,000,000 MORE Jobs Infrastructure Grant $10,000,000 Financing - Principal MDFA $ 5,000,000 Financing - Principal MTC $ 5,000,000 Financing - Estimated Interest Savings $ 2,593,080

Broader Public programs included in the Evergreen package Real Estate Tax Savings Workforce Training Fund Grant HIT Grant CDAG Infrastructure Grant PWED Infrastructure Grant 100% Personal Property Tax Exemption Sales and Use Tax Exemptions Financing - Citizens R&D Tax Credit Single Sales Factor $12,188,402 $ 1,000,000 30,000 $ 1,000,000 $ 1,000,000 $10,770,910 $10,000,000 $ 7,500,000

I. Summary - MA Estimated Incentives, Savings, and Financing Proposal

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant HIT Grant Real Estate Tax Exemption Savings "TIF" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) Financing Principal (MDFA, MTC, and Citizens) Financing Estimated Interest Savings *** Total Estimated Value of Proposal **** $ 10,000,000 $ $ $ $ 5 $ $ $ $ $ $ $ 500,000 10,000,000 1,000,000 1,000,000 3,000,000 12,188,402 1,000,000 30,000 734,099 10,770,910 7,500,000 10,000,000

TBD TBD $ $ $ 17,500,000 2,593,080 87,816,491

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) ** Assumes a negotiated TIF that gives an average 5% exemption for 20 years per the attached schedule (Exhibit 1). The actual exemption percentage and project period will be negotiated between Westborough and Evergreen Solar . This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/$1,000 AV. *** MDFA & RET savings vs. 8.25% rate, Citizens savings vs. 7.99% rate **** Includes grants, tax credits, offsets, identified savings, loan principal and interest savings

Evergreen Solar Backgrounder April 10, 2007 The Company Evergreen Solar, Inc., founded in 1994, develops, manufactures and markets solar photovoltaic (PV) power products primarily PV wafers, cells, and modules for residential and commercial use. Between 2004 and 2005, company revenues increased 87%, to $44 million. The company currently employs 310 workers at its headquarters, and pilot manufacturing facilities in Marlborough. The company employs a "string ribbon" technology, allowing it to use less silicon more efficiently to manufacture PV cells. The Expansion Opportunity The company plans to invest $150,000,000, for a 225,000 s.f. manufacturing facility supporting 350 new manufacturing jobs. The Massachusetts Office of Business Development (MOBD) has aggressively encouraged the company to locate in Massachusetts. MOBD assembled a competitive incentives proposal (summary is attached) including grants, infrastructure funding, tax exemptions, and financing to convince the company to expand here. The company informed MOBD that the tax and financing aspects of the proposal are competitive with other states, and that that only Oregon significantly exceeds the state's grant offerings. MOBD proposed locating the facility on state owned land adjacent to the Massachusetts Technology Collaborative facility in Westborough. In this approach, the company will enter into a long-term lease with MTC, who will own the land and function as the landlord. This option is highly desirable to the company for many reasons, including: Benefits of the MTC-adjacent site to the company Greater utility of state infrastructure grants to the project. The site allows for use of MORE Jobs program funds (and possibly other grants) to address infrastructure needs on the parcel, which would otherwise (on a private parcel) not be eligible. We expect the company to apply and be competitive in this process. Proximity. The company values the close proximity of the Westborough site to their Marlborough headquarters. The new site will be just 10 minutes away from the company's top decision-makers and pilot manufacturing engineers. The location also provides close proximity to the Massachusetts Technology Collaborative (MTC), whose Renewable Energy Trust (RET) leads efforts to promote renewable energy adoption in our state. Benefits of the MTC-adjacent site to Westborough Significant potential tax benefits for Westborough. The estimated incremental value of this new facility will generate approximately $546,000 in new property tax revenues per year.

Evergreen Solar Backgrounder April 10, 2007 MOBD thinking "outside the box" to solve a problem Special legislation is needed to convey 5% Investment Tax Credit (ITC) benefits to the project. Westborough is not an Economic Target Area (ETA) municipality. As such, it cannot grant tax increment financing (TIF) to a job-creating project, as part of the Economic Development Incentive Program (EDIP). Also, without the TIF, the project is not eligible for the 5% ITC. The 5% ITC is very important to Evergreen Solar, as it is more valuable than the standard 3% ITC offered to manufacturers not participating in the EDIP. Also, the 5% ITC provides generous carry-forward provisions that the company could exercise in future years. Through special legislation, the state can provide the 5% ITC and its carry-forward provisions to companies meeting specific criteria. Status EOHED will draft special legislation language that will make the 5% ITC available to Evergreen Solar in Westborough. Breakout of which funds are specifically for Evergreen/which are "standard" The incentive package that was offered to Evergreen is robust and creative. The MOBD team used the programs at their disposal and when that was exhausted they tapped into their relationships with private industry to make the package even more compelling. The is a great example of how I would like to see the government and private industry working toward common goals that benefit the Commonwealth of Massachusetts in it's entirety.

As we talk about the proposal I would like make special note that the majority of the programs in the proposal are available for all companies to access. We did create special one time incentives for Evergreen and this was to acknowledge their commitment to the Commonwealth. Of the $87M proposal $70 + M is from other programs for other companies to access.

EVERGREEN Special financing/savings vs public programs Special financing/savings specific to Evergreen Massachusetts Technology Collaborative Special Grant Land Cost Savings 5% Investment Tax Credit

$10,000,000 $ 3,000,000 $ 5,000,000

Narrower Public Programs included in the Evergreen package Massachusetts

Evergreen Solar Backgrounder April 10, 2007 Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant Financing - Principal MDFA Financing - Principal MTC Financing - Estimated Interest Savings $ 5,000,000 $10,000,000 $ 5,000,000 $ 5,000,000 $ 2,593,080

Broader Public programs included in the Evergreen package Real Estate Tax Savings Workforce Training Fund Grant HIT Grant CDAG Infrastructure Grant PWED Infrastructure Grant 100% Personal Property Tax Exemption Sales and Use Tax Exemptions Financing - Citizens R&D Tax Credit Single Sales Factor $12,188,402 $ 1,000,000 $ 30,000 $ 1,000,000 $ 1,000,000 $10,770,910 $10,000,000 $ 7,500,000

I. Summary - MA Estimated Incentives, Savings, and Financing Proposal

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant HIT Grant Real Estate Tax Exemption Savings "TIF" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) Financing Principal (MDFA, MTC, and Citizens) Financing Estimated Interest Savings *** Total Estimated Value of Proposal ****

$ $

10,000,000 500,000

S 10,000,000 1,000,000 $ S 1,000,000 3,000,000

S 12,188,402 S 1,000,000 30,000 S $ $ $ 734,099 10,770,910 7,500,000 10,000,000

TBD TBD $ 17,500,000 $ 2,593,080

$ 87,816,491

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) ** Assumes a negotiated TIF that gives an average 5% exemption for 20 years per the attached schedule (Exhibit 1). The actual exemption percentage and project period will be negotiated between Westborough and Evergreen Solar . This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/$1,000 AV. *** MDFA & RET savings vs. 8.25% rate, Citizens savings vs. 7.99% rate * * * * Includes grants, tax credits, offsets, identified savings, loan principal and interest savings

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT Internet: http :fiwww.mass.e.ov/econ

DEVAL PATRICK
GOVERNOR

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

April 10, 2007 1 am pleased to provide you with. the Commonwealth's Preliminary Incentives, Financing, and Savings Proposal to Evergreen Solar valued at up to $87,816,491 to effect the location of its new manufacturing facility at the MTC site in Westborough, Massachusetts. The proposal includes grants, tax exemptions, tax credits, cost offsets, financing, and identified savings. Assumptions used to calculate the savings and incentives are detailed in each section. The incentives and savings provided herein are predicated on information provided to us by Evergreen Solar regarding project investment, employment, environmental impact, and timing parameters, and are subject to change should revisions be made to these criteria. For purposes of this proposal, we have calculated our economic development incentives, financing, and savings based upon the following assumptions:
Capital investment Total Project $150,000,000 Jobs Created 350 Jobs Retained 310 Dates of Construction 2007-2008

Attached, you will find: 1) a summary proposal, 2) a description of each of the programs and the method/assumptions used to calculate the savings, and 3) additional data regarding the Massachusetts advantages. We are confident that our highly skilled workforce, world leading educational system, innovative economy, leading technology industry cluster, strong state and local government support, a vigorous commitment by Governor Patrick to grow the renewable energy sector, and a strong incentives package will provide Evergreen Solar with the ideal environment in which to thrive. Please call Mr. Art Robert if you have any questions regarding the proposal. The Commonwealth of Massachusetts is enthusiastically committed to working with. Evergreen Solar to assist you in a successful startup of your new manufacturing facility in Massachusetts.

Sincerely,

Robert Coughlin Undersecretary for Business Development (617) 788-368

Arthur P. Robert Industry Director, Renewable Energy Tel. (617) 788-3656

I. Summary - MA Estimated Incentives, Savings, and Financing Proposal

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant HIT Grant Real Estate Tax Exemption Savings "TIF" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) Financing Principal (MDFA, MTC, and Citizens) Financing Estimated Interest Savings *** Total Estimated Value of Proposal **** $ 10,000,000 $ 500,000

$ 10,000,000 $ $ $ 1,000,000 1,000,000 3,000,000

$ 12,188,402 $ $ $ 1,000,000 30,000 734,099

$ 10,770,910 $ 7,500,000

$ 10,000,000 TBD TBD $ 17,500,000 $ 2,593,080

$ 87,816,491

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) ** Assumes a negotiated Ilk that gives an average 5% exemption for 20 years per the attached schedule (Exhibit I). The actual exemption percentage and project period will be negotiated between Westborough and Evergreen Solar . This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/$1,000 AV. *** MDFA & RET savings vs. 8.25% rate, Citizens savings vs. 7.99% rate **** includes grants, tax credits, offsets, identified savings, loan principal and interest savings

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF. BUSINESS DEVELOPMENT
ONE ASHBURTON PLACE SUITE 2101 BOSTON, MA 02108
TELEPHONE: 617-788-3670 FAX: 617-788-3695 Internet: httn://www.rnass.gov/mobd

DEVAL PATRICK
GOVERNOR

DANIEL O'CONNELL
SECRETARY OF HOUSING AND ECONOMIC DEVELOPMENT

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

Commonwealth of Massachusetts Incentives, Savings, and Financing Proposal Prepared exclusively for Evergreen Solar April 9, 2007

ROBERT COUGHLIN
UNDERSECRETARY OF BUSINESS DEVELOPMENT

This proposal outlines the general terms of the incentives, savings, and financing package being offered by Massachusetts to Evergreen Solar to assist with the location construction of a new manufacturing facility in Westborough, Massachusetts. This offer is subject to the successful completion of applications as noted and compliance with program requirements. The incentives related to the Economic Development Incentive Program are subject to negotiation with and approval by the town of Westborough. In order to be eligible for the Economic Development Incentive Program, Evergreen Solar must locate the facility in an ETA designated municipality. Approval of grants from the Workforce Training Fund are subject to completion and submission of a complete application by the company and approval by the WTF Advisory Board.

II. General Information a) Contact Information: Mr. Richard Chleboslci VP Worldwide Expansions Evergreen Solar MTC Site in Westborough, Massachusetts Manufacturing of PV wafers, cells, and panels

b) Proposed Project Location: c) Type of Business:

HI. Project Overview Description To support the growth in its business, Evergreen Solar plans to build a new 225,000 s.f. manufacturing facility. Evergreen Solar plans to invest $150,000,000 for real estate, building construction, and equipment at the site. Phase one of the project will create 350 new jobs and $150 million in private investment. Evergreen envisions, but is not committed to, a second phase at the site. That phase would create an additional 300 jobs and an additional private investment of $140,000,000 million. Company Employment Plan In addition to retaining the 310 jobs currently located at their Marlborough facility, Evergreen Solar will add 350 new jobs at an average salary of $44,380.

IV. Job Creation and Investment Incentives Economic Development Incentive Program (EDIP) Through the EDIP, designated Economic Target Area (ETA) communities, in partnership with the Commonwealth, can provide 1) real estate property tax exemptions, 2) personal property tax exemptions, and 3) investment tax credits to businesses locating to or expanding in the community. The EDIP is a three-way partnership between the state, the municipality and the participating job creating business. EDIP How it Works The municipality makes available local Tax Increment Financing (TIF) - a negotiated real estate tax exemption based on a percentage of the value added through renovation or new construction. The duration of the 11E is for a period of no less than five years and no more than twenty years. The terms of the TIF are negotiated between the property owner seeking the benefits of the EDIP and the municipality. The state does not participate in that negotiation. In addition to the negotiated TIF real estate property tax exemption, the business would automatically receive a 100% personal property tax exemption on the site for the life of the project.

To qualify for the EDIP incentives a participating business must become a "Certified Project". As part of the Certified Project, the business must agree to create at least one permanent full-time, net new Massachusetts job. As part of the Certified Project, the business also agrees to a specific level of private investment and job retention where applicable. Upon municipal approval, and then the approval of the Economic Assistance Coordinating Council (EACC), the state makes available a 5% investment tax credit known as the 5% Economic Opportunity Area Credit.

Westborough is not an ETA municipality. The availability of EDIP benefits to the project is subject to passage of special legislation. The Commonwealth can pursue special legislation to secure EDIP program benefits, or it can pursue special legislation to secure only Investment Tax Credit Benefits to support the project. See more on this option, in the "Investment. Tax Credit" section.

Illustrative Example of EDIP and Hypothetical Savings Real Estate Property Tax Exemption Savings The terms of the TIF agreement are to be determined through negotiation between Westborough and Evergreen Solar. For illustration purposes only (to demonstrate how the TIF works), we have assumed the new building of 225,000s.f. will result in an incremental value of $40,000,000 We assumed that this value will increase by 3% annually. We used Westborough's current commercial real estate tax rate of $13.66/$1,000 AV. Therefore, there will be an initial incremental annual real estate tax liability of $546,400. This liability will grow 3% annually. If we assume that the negotiated TIF is for 20-years and provides an annual exemption of 5%, then the total savings from the real estate property tax exemption (TIF) over the 20-year life of the project will be $734,099 (see attached Exhibit 1 TIF Spreadsheet). Please note that this illustration is not a proposal from any municipality and that the actual terms of a TIF, including the length of the TIF period, must be negotiated between Evergreen Solar and the town of Westborough. Westborough is not currently an ETA municipality and would have to become one by approving the ETA designation and receiving approval from the EACC before offering a TIF. Personal Property Tax Savings As a Certified Project with a TIF agreement, Evergreen Solar will automatically qualify for a 100% exemption on personal property taxes over the 20 year life of the project at this site. Beyond the 20-year project period, as a manufacturing corporation in Massachusetts, Evergreen Solar will qualify for a 100% exemption on personal property taxes on all manufacturing equipment. Based on the numbers provided by Evergreen Solar, there will be $87,0000,000 in tangible depreciable assets (equipment) at the new facility. We assumed that these would be depreciated on a straight-line basis over 10 years. We then assumed that an additional $2 million of equipment would be purchased annually and also depreciated over a ten year period. We assumed the personal property tax rate to be $15.00/$1,000 in value. Over the 20-year life of theproject, the total Personal Property Tax exemption savings is estimated to be $10,770,910 (see attached Exhibit 2 Personal Property Tax Exemption Spreadsheet). Commonwealth of Massachusetts Investment Tax Credit Successful completion of the EDIP process, as outlined above, will facilitate the extension of an EOA Investment Tax Credit (EOA-ITC) of 5% to Evergreen Solar as a "Certified Project". The EOA-ITC can be utilized by the certified project business during the entire term of the TIF agreement between the property owner and the municipality (in this example 20 years).

Based on the $150,000,000 investment in real estate, equipment, and facilities provided to us by Evergreen Solar and assuming all of these qualify for the investment tax credit, the total 5% Investment Tax Credit will be $7,500,000. This amount can be applied directly against any Massachusetts tax obligation (though use of the EOA-ITC cannot in any single year reduce Massachusetts tax liability by greater than 50%). Unused credits may be carried forward to subsequent years over the 20-year life of the project (through. 2026). Our assumption is that Evergreen Solar will be in a position to fully utilize the available credits during the 20-year project life. The Commonwealth can pursue the provision of 5% ITC benefits to support this project through special legislation. Through this option, other EDIP program benefits would not be available to the project. The availability of 5% ITC benefits to the project is subject to passage of special legislation.

V. Renewable Energy Trust (MTC) Grants

Massachusetts Technology Collaborative Special Grant The Massachusetts Technology Collaborative (MTC) through its Renewable Energy Trust (RET) will provide a $10,000,000 grant to be used to offset the costs of construction and equipment for Evergreen Solar's new manufacturing facility. In return, Evergreen Solar must commit to creating 350 new incremental full-time jobs at the new Massachusetts' facility (above and beyond the 310 jobs currently employed in Massachusetts) over a 24 month period from completion of construction and Evergreen Solar must commit to an investment of $150 million in the new facility for real estate, construction, and equipment. The new jobs created must be sustained over a ten year period. The grant and its terms must be approved by the MTC Board. MTC LORI Grant
The Massachusetts Technology Collaborative (MTC), as administrator of the Renewable Energy Trust Fund (the Trust), is seeking applications for the Large Onsite Renewables Initiative to expand the . production and use of distributed renewable energy technologies in Massachusetts. MTC seeks to develop a diverse portfolio of renewable energy projects across a variety or locations, technologies, and building types. Round 3, has approximately $3.5 million available. Applicants will be subject' to a competitive selection process. LORI applicants may request funding in two activity areas: Feasibility Study Grants and Design & Construction Grants. During open solicitation rounds, LORI will accept grant applications for development of eligible renewable energy projects(s) with greater than 10 kilowatts of nameplate capacity that are located at commercial, industrial, institutional and public facilities that will consume more than 25% of the renewable energy generated by the project onsite. The applicant and project site(s) must be a. customer of a Massachusetts investor-owned. electric distribution utility. The grant awards may be used to facilitate the installation of renewable energy projects on existing buildings (retrofits) or in conjunction with new construction/major renovation projects, including green buildings. MTC leadership has recommended that a $500,000 grant be provided to the Evergreen Solar project through the LORI program. The grant award must be - approved by the MTC Board.

VI. Infrastructure Grants MORE Jobs Capital Program The MORE Jobs Capital Program was established in an economic stimulus bill that was passed by the legislature and signed into law by Governor Romney on June 24, 2006 (Chapter 123 of the Acts of 2006). The MORE Jobs Capital Program may be used to fund public infrastructure requirements of business expansion and relocation projects that will enable a private investment to occur resulting in the creation of at least 100 new jobs in Massachusetts over a 24 month period. Other program requirements are that the project must generate substantial sales from outside the Commonwealth and the company must maintain the newly created jobs for at least five years. The grant can be used for public infrastructure such as roadways, sewer, utilities, water, wastewater, etc. The grant must be applied for jointly by the company and the municipality. The application and grant award must be approved by the Secretary of Economic Development and Housing. Grant monies will be made available to the municipality as a reimbursement for the capital costs of the public infrastructure project. The Evergreen Solar project will create 350 new jobs, and MOBD will recommend a grant of up to $10,000,000 to pay for any eligible public infrastructure required by the project. Community Development Action Grant (CDAG) The Community Development Action Grant Program (CDAG), funded by the Commonwealth, provides support for publicly owned or managed projects in areas where private investment will not otherwise occur without the CDAG grant. The goal is to stimulate economic development activities that will attract and leverage private investment, create or retain long-term employment and revitalize distressed areas. Any city or town in the Commonwealth is eligible to apply to DHCD for CDAG funds. The amount of CDAG funding requested by the community must be the minimum amount necessary to make the project feasible and any benefit to private entities or individuals must be indirect and incidental and not the purpose of the project. CDAG can be used in a variety of ways, including installation, improvement, construction, repair, rehabilitation or reconstruction of buildings or other structures, facades, streets, roadways, thoroughfares, sidewalks, rail spurs, utility distribution systems, water and sewer lines, for site preparation and improvements, demolition of existing structures, and relocation assistance. A community may submit one individual application and/or one joint application for CDAG funding for the CDAG FY08 funding round. Individual CDAG awards are limited to a maximum of $1 million per project. The Evergreen Solar project is eligible to receive a CDAG grant of up to $1,000,000 for eligible public infrastructure costs. Public Works Economic Development Program (PWED) Grant The PWED Program provides grants to municipalities for the design and construction of roads and roadways and any other transportation related projects that support economic development. PWED grants are approved by the Executive Office of Transportation. Any city or town in the Commonwealth is eligible to apply to for PWED funds. There is a grant cap of $1,000,000 per project per municipality. The Evergreen Solar project is eligible to receive a PWED grant of up to $1,000,000 for eligible public roadway construction/upgrade costs.

VII. Financing A total financing package of $17,500,000 for the private investment in building and equipment will be supplied by three sources MassDevelopment, Renewable Energy Trust (MTC), and Citizens Bank. The Renewable Energy Trust will purchase a participation in a single note offered by MassDevelopment, which will service the loan, including any staffing for work out negotiations. Awards are contingent upon approval by the respective Boards of MassDevelopment and Massachusetts Technology Collaborative and successful underwriting by Citizen's Bank. Mass Development Emerging Technology Fund Loan Amount: $5,000,000, all available to support phase I. Limited to 25% of total project cost. All advances on equipment limited to 85% of invoice cost, at time of receipt of equipment in the facility in which it will be installed. 6% 1% 7 years (first 18 months interest only) with the outstanding principal to be amortized over the remaining 66 months First position lien on the assets financed (at 85% advance rates) and a junior lien on all other business assets. This junior lien is (1) junior only to the $25 million line of credit with Silicon Valley Bank that is due to be put in place, (2) pari passu with the $7.5 million loan by Citizens Bank of Massachusetts for certain equipment not financed by the MassDevelopment/MTC loans, and (3) pari passu with junior lien of MTC. MassDevelopment and MTC will share in a warrant package, with number of shares/warrants based on one year's worth of interest on the original loan amount, divided by the average price of the stock over the last 20 trading day closing price preceding the financing. The average price when determined will be divided into the interest due during the first year to determine how many shares of common stock the warrant package will provide and produce the exercise price of the warrants. The average closing price will be the warrant exercise price. Additional terms to be addressed through a separate term sheet, subject to negotiation. Must receive formal approval by the MassDevelopment Board.

Interest rate: Commitment Fee: Term:

Collateral:

Success Fee:

Other:

Approval:

Renewable Energy Trust (MTC) Loan Amount:

$5,000,000, all available to support phase 1. All advances on equipment limited to 85% of invoice cost, at time of receipt of equipment in the facility in which it will be installed.

Interest rate: Commitment Fee: Term:

6% 1% 7 years (first 18 months interest only) with the outstanding principal to be amortized over the remaining 66 months First position lien on the assets financed (at 85% advance rates) and a junior lien on all other business assets. This lien is (1) junior only to the $25 million line of credit with Silicon Valley Bank that is due to be put in place, (2)pari passe with$7.5 million loan by Citizens Bank of Massachusetts for certain equipment not financed by the MassDevelopment/MTC loans, and (3) pari passu with junior lien of MDFA. Same as MassDevelopment: MassDevelopment and MTC will share in a warrant package, with number of shares/warrants based on one year's worth of interest on the original loan amount, divided by the average price of the stock over the last 20 trading day closing price preceding the financing. The average price when determined will be divided into the interest due during the first year to determine how many shares of common stock the warrant package will provide and produce the exercise price of the warrants. The average closing price will be the warrant exercise price. Additional terms to be addressed through a separate term sheet, subject to negotiation. Must receive formal approval by the Massachusetts Technology Collaborative Board

Collateral:

Success Fee:

Other:

Approval:

Citizens Job Bank Program Economic Development Loan Citizens Bank offers the following terms, contingent on additional negotiations and underwriting terms, summarized below: Amount: $7,500,000, 5 year fully amortizing term loan all available to support phase 1. (Provided Evergreen certifies that the amount is less than $40,000 per new job created within 36 months of the completion of the project and provided that the loan amount does not exceed 75% of assets financed) 4.99% on first $5,000,000, and 5.99% on next $2,500,000 for a blended rate of 5.32%

Rates:

Collateral:

First priority lien on specific assets financed and second priority lien on all business assets behind Silicon Valley Bank, part passu with MassDevelopment and the Massachusetts Technology Collaborative. Additional terms to be addressed separately with Citizens Bank, subject to negotiation. Approval of this Economic Development Loan by Citizens is subject to Citizens' normal underwriting guidelines and loan approval requirements and execution of documentation satisfactory to the bank and its legal counsel.

Other:

Underwriting:

VIII. Corporate Taxes

Single Sales Factor Tax Apportionment A potentially significant cost advantage in Massachusetts to manufacturers like Evergreen Solar is the "single sales factor" tax apportionment. For manufacturing corporations with multi-state tax filings, the single sales factor apportions state corporate income tax based solely on a ratio of instate sales to total sales. Other states typically use more complicated apportionment formulas, which include not only the in-state sales ratio but also include the ratio of in-state payroll to total payroll and the ratio of in-state property to total property. The practical implication is that these states penalize companies that hold and add tangible assets and jobs in that state. For instance, California, New Jersey, and New Mexico all use multiple factor apportionment, which penalizes manufacturers for owning property and paying wages in-state. As manufacturers like Evergreen Solar expand their facilities and create new jobs in these states, the effective tax rate and the resultant tax burden for the company will likely increase. In Massachusetts, we welcome investments in people and property. In Massachusetts, such investments will have no negative impact on Evergreen Solar's corporate tax rate and tax burden. The long term tax savings from the single sales factor apportionment can often be very substantial and it is not unusual that the value of these savings can be more than the value of the rest of the incentives combined. Research and Development Tax Credit Massachusetts has the most favorable R&D tax incentive in the nation. In Massachusetts, any costs which would qualify for the Federal R&D tax credit are eligible for a 10% Massachusetts R&D Tax Credit. This credit can be used in addition to the Investment Tax Credit and can reduce tax liability to the minimum of $456 annually. In addition, a 15% R&D Tax Credit is available for costs related to donations and contributions made to research organizations such as hospitals and universities. The R&D credit cannot reduce a corporation's tax liability below the minimum $456 and cannot reduce any tax liability over $25,000 by more than 75%. However, a corporation may carry forward for an unlimited period of time any portion of the R&D credit which cannot be allowed in a particular tax year because of this limit. Sales and Use Tax Credit Massachusetts exempts all manufacturing equipment and all R&D equipment from sales and use taxes. Therefore, regardless of where Evergreen Solar purchases this equipment, Evergreen Solar will not pay the 5% MA sales tax nor the 5% MA use tax. Based on the same assumptions for machinery and equipment purchases that we made for the PPT exemption (see Exhibit 2), we 10

estimate the total machinery and equipment purchases over the 20-year project life to be $200 million. We assumed that all of this machinery and equipment is for the purposes of R&D and/or manufacturing. Based on these assumptions, over the 20-year project period, the sales and use tax exemption savings could be as high as $10,000,000 ($200,000,000 x .05).

IX. Workforce and Training Workforce Training Fund (WTF) The Massachusetts Business Resource Team will assist Evergreen Solar in applying for workforce training grants via the Massachusetts Workforce Training Fund (WTF). The WTF provides grants to train new employees or to upgrade the skills of existing employees. The WTF has no income requirements and is especially applicable to Evergreen Solar's more technically skilled workers. Companies applying to the program for the first time receive preference. Companies can receive multiple grants. This flexible program requires a company match that can be met by "in-kind" expenses incurred in providing the training. Typically, applicants meet the match through the salaries of employees as they provide or receive the training that is funded by the grant. The grant cap on the WTF is $1 million per company per year. Historically, grants have usually averaged out to approximately $1,100 per employee. However, for more technology driven industries like life sciences, grants have averaged closer to $1,600 per employee. Based on the number of 310 current employees and projections to add 350 new employees and given the highly technical skill requirements for training, Evergreen Solar could very possibly qualify for a Workforce Training Fund Grant of up to $1,000,000 (660 employees x $1,600/employee). These grant monies would be set up in an account and could be used over a two-year period. A grant from the Workforce Training Fund requires approval of the Workforce Advisory Board. The Commonwealth Corporation will provide free application assistance to save you time and money and to help ensure that the final application has a higher likelihood of approval. The HIT Grant The Hiring Incentive Training (HIT) Grant Program is open to all employers. It provides training grants of up to $2,000 per employee and up to $30,000 a year per company. This program assists in paying training costs for newly hired employees who have been unemployed over a year and those that do not have a call back date from their last employer. Assuming that 10% of the new hires meet the HIT criteria, the potential value of the HIT grant to Evergreen Solar could be as high as $30,000 (350 new hires x 10% x $2,000). Workforce Assistance Upon site identification, the Department of Workforce Development can facilitate curriculum development or program design at the nearby community college or technical school to ensure access to the training your workforce needs. Once you are ready to hire, DWD's Division of Career Service can assist with providing targeted recruitment and prospective employee screening at one of our 32 One Stop Career Centers across the Commonwealth. DWD is ready to be an active partner in the education and training of your workforce in Massachusetts.

1.1

X.

Land Cost Savings

MTC Site in Westborough The Commonwealth of Massachusetts is proposing that Phases One and Two of the Evergreen Solar project be located at a publicly owned 13-16 acre parcel in Westborough, Massachusetts adjacent to the Massachusetts Technology Collaborative (MTC) parcel. If the project is constructed at this site, Evergreen Solar could realize up to $3,000,000 in savings by avoiding land acquisition costs. MTC would retain public ownership of the land and lease the land to Evergreen Solar at a nominal rate for up to 30 years.

XI.

Real Estate Tax Savings

MTC Site in Westborough In the initial proposal that was submitted to Evergreen Solar for Phase One only, the assumed real estate tax rate was $25.00/$1,000 AV. That tax rate was based on the City of Marlborough's tax rate. The current proposal to locate the project at the MTC site in Westborough will result in a substantial real estate tax savings. Westborough has a single classification real estate tax rate of $13.66/$1,000 AV. We assumed that the real estate tax rates will remain constant over the 20-year project period. For the current project focused on Phase I alone, the real estate tax savings generated by this rate differential will be $12,188,402 (see Exhibit 1).

XII. Massachusetts Its All Here Leading Renewable Energy Cluster o Governor Patrick's commitment to bold initiatives to build the renewable energy sector o Energy efficiency and renewable energy sectors employ 10,000 in Massachusetts o Massachusetts has world leading cluster of renewable energy companies o Massachusetts has 60 renewable energy companies employing more than 3,000 o Massachusetts Technology Collaborative (Renewable Energy Trust) o Well established supply chain right here in Massachusetts o Next generation renewable energy research being done by nine universities in MA World Class Workforce o Highest concentration of bachelors and masters degees in the country o Highest concentration of science and engineering degrees in the country o Ranked rd nationally in worker productivity o Large, highly skilled, experienced workforce in energy and technology sectors

12

#1 Education System in the Country Postsecondary and Public Schools (K-12) o Three of the top fifteen research universities (measured by technology licensing revenues) in the country (University of Massachusetts, Harvard, MIT) o Highest concentration of college students in the country Public Schools o # 1 nationally in SAT assessment test scores in math and #2 in verbal o # I nationally in NEA assessment test scores in both math and reading I-495/Central Massachusetts corridor strikes a balance between access to a highly skilled workforce, affordability, and access to major highways, airports, and rail transportation o Located in the heart of the technology sector workforce in MA o Located only 10 minutes from the Marlborough facility and next door to MTC o Westborough is at intersection of1-495, Mass Pike, and Rte. 9 o Within 60 miles of nearly every major postsecondary institution in Massachusetts. o Within 45 minutes of Logan International Airport o Direct commuter rail direct service to Boston and Worcester o Cost of Living Index of Central Massachusetts is 50%-70% lower than Boston Excellent Quality of Life to Attract and Retain Professional and Technical Personnel o Proximity to great public schools Westborough and neighboring Shrewsbury, Nortlaborough and Southborough all among top 25 school systems in the state o Very low violent crime rate o Within 35 miles of five of top hospitals in the country (Mass General, Brigham and Women's, Dana Farber, Beth Israel Deaconess, and Children's Hospital) o 45 minutes to the history of Boston or the seashore, 2 hours to world-class skiing o Home of the world renowned Boston Symphony and Boston Pops o Home of the World Champion New England Patriots and Boston Red Sox

NEW ECONOMY INDEX 1 (1=HIGHEST, 50=LOWEST) Other States V. Massachusetts OR MA NM NY 11 1 27 10 Overall State Ranking 7 3 25 11 Knowledge Jobs I7 3 21 37 Economic Dynamism 14 6 1 41 Digital Economy 7 14 18 1 Innovation Capacity 18 12 1 15 High Tech Jobs

Source: Progressive Policy Institute

13

Milken Science and Technology Index2 2002 1 7 20 23 2004 1 7 14 19 Rank Change 0 0 6 4 Score 84.35 69.03 61.75 57.76

Massachusetts New York New Mexico Oregon

Footnotes:

`The 2004 State Technology and Science Index encapsulates each state's comprehensive inventory of technology and science assets that can be leveraged to promote economic development. The Index provides states with a benchmark, monitors their technology progress and can be leveraged to promote economic growth. It provides a valuable framework of measures to guide state policy makers and the public on the realities of their performance in the knowledge-based economy of today. "Places that can attract, grow and retain firms and industries proficient at deploying information technology, in addition to producing it, will be at a competitive advantage," the report says. "The degree to which a state's knowledge assets are harnessed and converted into successful innovations, products and services determine its economic future."

Please feel free to contact us with any questions regarding the proposal or to let us know what we can do to further assist Evergreen Solar on this important decision. The Commonwealth of Massachusetts and its partners look forward to working with Evergreen Solar to make its new manufacturing facility in Massachusetts a large success.

Arthur P. Robert Industry Director, Renewable Energy Massachusetts Office of Business Development (617) 788-3656

14

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant lILT Grant Real Estate Tax Exemption Savings "TIE" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings

$ $ $ $ $ $ $ $

10,000,000 500,000 10,000,000 1,000,000 1,000,000 3,000,000 12,188,402 1,000,000 30,000

$ $ $ $ TBD TBD $ $$

734,099 10,770,910 7,500,090 10,000,000

Research & Development Tax Credit (10-15%)

Financing Principal (MDFA, MTC, and Citizens) Financing Estimated Interest Savings *** Total Estimated Value of Proposal ****

17,500,000

2,593,080
87.816,491

Exhibit 2 Evergreen Solar proposal - Personal Property Tax Exemption Schedule Initial Equipment Value of Additional Investment Value Equipment Purchases $87,000,000 $78,300,000 $69,600,000 $60,900,000 $52,200,000 $43,500,000 $34,800,000 $26,100,000 $17,400,000 $8,700,000 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 $16,000,000 $18,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 $20,000,000 Total Value Equipment PPT Taxes PPT Rate w/o TIF $1,215,740 $1,124,218 $1,032,696 $941,174 $849,652 $758,130 $666,608 $575,086 $483,564 $392,042 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $10,770,910 PPT Tax Savings vv/TIF $1,215,740 $1,124,218 $1,032,696 $941,174 $849,652 $758,130 $666,608 $575,086 $483,564 $392,042 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $273,200 $10,770,910

Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Total

Exemption 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

$89,000,000 $13.66 $82,300,000 $13.66 $75,600,000 $13.66 $68,900,000 $13.66 $62,200,000 $13.66 $55,500,000 $13.66 $48,800,000 $13.66 $42,100,000 $13.66 $35,400,000 $13.66 $28,700,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66 $20, 000,000 $13.66 $20,000,000 $13.66 $20,000,000 $13.66

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND I ECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT Internet: http://www.mass.gov/econ

DEVAL PATRICK GOVERNOR TIMOTHY MURRAY

LIEUTENANT GOVERNOR

March 12, 2007 I am pleased to provide you with the Commonwealth's Preliminary Incentives, Financing, and Savings Proposal to Evergreen Solar valued at up to $113,055,169 to effect the location of its new manufacturing facility at the MTC site in Westborough, Massachusetts. The proposal includes grants, tax exemptions, tax credits, cost offsets, financing, and identified savings. Assumptions used to calculate the savings and incentives are detailed in each section. The incentives and savings provided herein are predicated on information provided to us by Evergreen Solar regarding project investment, employment, environmental impact, and timing parameters, and are subject to change should revisions be made to these criteria. For purposes of this proposal, we have calculated our economic development incentives, financing, and savings based upon the following assumptions:
Capital Investment Total Project Jobs Created Jobs Retained Dates of Construction

$260,000,000

700

310

2007-2008

Attached, you will find: 1) a summary proposal, 2) a description of each of the programs and the method/assumptions used to calculate the savings, and 3) additional data regarding the Massachusetts advantages. We are confident that our highly skilled workforce, world leading educational system., innovative economy, leading technology industry cluster, strong state and local government support, a vigorous commitment by Governor Patrick to grow the renewable energy sector, and a strong incentives package will provide Evergreen Solar with the ideal environment in which to thrive. Please call Mr. Art Robert if you have any questions regarding the proposal. The Commonwealth of Massachusetts is enthusiastically committed to working with Evergreen Solar to assist you in a successful startup of your new manufacturing facility in Massachusetts.

Sincerely,

Robert Coul-klin Undersecretary for Business Development Tel. (617) 788-3688

Arthur P. Robert Industry Director, Renewable Energy Tel. (617) 788-3656

I. Summary - MA Estimated Incentives, Savings and Financine_Proposal

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant HIT Grant Real. Estate Tax Exemption Savings "TIF" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) Financing Principal (MDFA, MTC, and Citizens) Financing Interest Savings (vs. 12% private rate) Total Estimated Value of Proposal
***

$ $ $ S S $ $ $

10,000,000 500,000 10,000,000 1,000,000 1,000,000 3,000,000 24,376,804 1,000,000 140,000 1,468,197

$ $ $

15,831,940 13,000,000 10,000,000 TBD

S $

TBD 17,500,000 4.238,228

113,055,169

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) ** Assumes a negotiated TIF that gives an average 5% exemption for 20 years per the attached schedule (Exhibit 1). The actual exemption percentage and project period will be negotiated between Westborough and Evergreen Solar . This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/$1,000 AV. *** Includes grants, tax credits, offsets, identified savings, loan principal and interest savings 2

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT
ONE ASHBURTON PLACE SUITE 2101 BOSTON, MA 02108
TELEPHONE: 617-788-3670 FAX: 617-788-3695 Internet: http://www.rnass.gov/mobd

DANIEL O'CONNELL DEVAL PATRICK

GOVERNOR SECRETARY OF HOUSING AND ECONOMIC DEVELOPMENT

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

Commonwealth of Massachusetts Incentives, Savings, and Financing Proposal Prepared exclusively for Evergreen Solar March 12, 2007

ROBERT COUGHLIN
UNDERSECRETARY OF BUSINESS DEVELOPMENT

This proposal outlines the general terms of the incentives, savings, and financing package being offered by Massachusetts to Evergreen Solar to assist with the location construction of a new manufacturing facility in Westborough, Massachusetts. This offer is subject to the successful completion of applications as noted and compliance with program requirements. The incentives related to the Economic Development Incentive Program are subject to negotiation with and approval by the town of Westborough. In order to be eligible for the Economic Development Incentive Program, Evergreen Solar must locate the facility in an ETA designated municipality. Approval of grants from the Workforce Training Fund are subject to completion and submission of a complete application by the company and approval by the WTF Advisory Board.

II. General Information a) Contact Information: Mr. Richard Chleboski VP Worldwide Expansions Evergreen Solar MTC Site in Westborough, Massachusetts Manufacturing of solar cells and panels

b) Proposed Project Location: c) Type of Business:

HI. Project Overview Description To support the growth in its business, Evergreen Solar plans to build a new 500,000 s.f. manufacturing facility. Evergreen Solar plans to invest $260,000,000 for real estate, building construction, and equipment at the site. Phase one of the project will create 400 new jobs and $150 million in private investment. Phase two, which is expected to follow within 12 months of phase one, will create an additional 300 jobs and an additional private investment of $110 million. This proposal is based upon locating the facility on state owned land adjacent to the MTC facility in Westborough. Company Employment Plan In addition to retaining the 310 jobs currently located at their Marlborough facility, Evergreen Solar will add 700 new jobs at an average salary of $51,000.

IV. Job Creation and Investment Incentives Economic Development Incentive Program (EDIP) Through the EDIP, designated Economic Target Area (ETA) communities, in partnership with the Commonwealth, can provide 1) real estate property tax exemptions, 2) personal property tax exemptions, and 3) investment tax credits to businesses locating to or expanding in the community. The EDIP is a three-way partnership between the state, the municipality and the participating job creating business. EDIP How it Works The municipality makes available local Tax Increment Financing (TIF) - a negotiated real estate tax exemption based on a percentage of the value added through renovation or new construction. The duration of the TIF is for a period of no less than five years and no more than twenty years. The terms of the TIF are negotiated between the property owner seeking the benefits of the EDIP and the municipality . The state does not participate in that negotiation. In addition to the negotiated TT real estate property tax exemption, the business would automatically receive a 100% personal property tax exemption on the site for the life of the project. To qualify for the EDIP incentives a participating business must become a "Certified Project". As part of the Certified Project, the business must agree to create at least one permanent full-time, net new Massachusetts job. As part of the Certified Project, the business also agrees to a specific level of private investment and job retention where applicable. Upon municipal approval, and then the approval of the Economic Assistance Coordinating Council (EACC), the state makes available a 5% investment tax credit known as the 5% Economic Opportunity Area Credit.

Illustrative Example of EDIP and Hypothetical Savings 4

Real Estate Property Tax Exemption Savings The terms of the TIF agreement are to be determined through negotiation between Westborough and Evergreen Solar. For illustration purposes only (to demonstrate how the TIF works), we have assumed the new building of 500,000s.f. will result in an incremental value of $80.000,000 ($160 per s.f.). We assumed that this value will increase by 3% annually. We used Westborough's current commercial real estate tax rate of $13.6651,000 AV. Therefore, there will be an initial incremental annual real estate tax liability of $1,092,800. This liability will grow 3% annually. If we assume that the negotiated TIF is for 20-years and provides an annual exemption of 5%, then the total savings from the real estate property tax exemption (TIF) over the 20-year life of the project will be $1,468,197 (see attached Exhibit 1 TIF Spreadsheet). Please note that this illustration is not a proposal from any municipality and that the actual terms of a TIF, including the length of the TIF period, must be negotiated between Evergreen Solar and the town of Westborough. Westborough is not currently an ETA municipality and would have to become one by approving the ETA designation and receiving approval from the EACC before offering a TIF. Personal Property Tax Savings As a Certified Project with a TIF agreement, Evergreen Solar will automatically qualify for a 100% exemption on personal property taxes over the 20 year life of the project at this site. Beyond the 20year project period, as a manufacturing corporation in Massachusetts, Evergreen Solar will qualify for a 100% exemption on personal property taxes on all manufacturing equipment. Based on the numbers provided by Evergreen Solar, there will be $160,000,000 in tangible depreciable assets (equipment) at the new facility. We assumed that these would be depreciated on a straight-line basis over 10 years. We then assumed that an additional $2 million of equipment would be purchased annually and also depreciated over a ten year period. We assumed the personal property tax rate to be $15.00/1,000 in value. Over the 20-year life of the project, the total Personal Property Tax exemption savings is estimated to be $15,831,940 (see attached Exhibit 2 Personal Property Tax Exemption Spreadsheet).
Commonwealth of Massachusetts

Investment Tax Credit Successful completion of the EDIP process, as outlined above, will facilitate the extension of an EOA Investment Tax Credit (EOA-ITC) of 5% to Evergreen Solar as a "Certified Project". The EOA-ITC can be utilized by the certified project business during the entire term of the TIF agreement between the property owner and the municipality (in this example 20 years). Based on the $260,000,000 investment in real estate, equipment, and facilities provided to us by Evergreen Solar and assuming all of these qualify for the investment tax credit, the total 5% Investment Tax Credit will be $13,000,000. This amount can be applied directly against any Massachusetts tax obligation (though use of the EOA-ITC cannot in any single year reduce Massachusetts tax liability by greater than 50%). Unused credits may be carried forward to subsequent years over the 20-year life of the project (through 2026). Our assumption is that Evergreen Solar will be in a position to fully utilize the available credits during the 20-year project life. V. Renewable Energy Trust (MTC) Grants Massachusetts Technology Collaborative Special. Grant 5

The Massachusetts Technology Collaborative (MTC) through its Renewable Energy Trust (RET) will provide a $10,000,000 grant to be used to offset the costs of construction and equipment for Evergreen Solar's new manufacturing facility. In return, Evergreen Solar must commit to creating 700 new incremental full-time jobs at the new Massachusetts facility (above and beyond the 310 jobs currently employed in Massachusetts) over a 24 month period from completion of construction and Evergreen Solar must commit to an investment of $260 million in the new facility for real estate, construction, and equipment. The new jobs created must be sustained over a five year period. The grant and its terms must be approved by the MTC Board.
MTC LORI Grant The Massachusetts Technology Collaborative (MTC), as administrator of the Renewable Energy Trust Fund (the Trust), is seeking applications for the Large Onsite Renewables Initiative to expand the production and use of distributed renewable energy technologies in Massachusetts. MTC seeks to develop a diverse portfolio of renewable energy projects across a variety or locations, technologies, and building types. Round 3, has approximately $3.5 million available. Applicants will be subject to a competitive selection process. LORI applicants may request funding in two activity areas: Feasibility Study Grants and Design & Construction Grants. During open solicitation rounds, LORI will accept grant applications for deVelopment of eligible renewable energy projects(s) with greater than 10 kilowatts of nameplate capacity that are located at commercial, industrial, institutional, and public facilities that will consume more than 25% of the renewable energy generated by the project onsite. The applicant and project site(s) must be a customer of a Massachusetts investor-owned electric distribution utility. The grant awards may be used to facilitate the installation of renewable energy projects on existing buildings (retrofits) or in conjunction with new construction/major renovation projects, including green buildings. MTC leadership has recommended that a $500,000 grant be provided to the Evergreen Solar project through the LORI program. The grant award must be approved by the MTC Board.

VI. Infrastructure Grants

MORE Jobs Capital Program The MORE Jobs Capital Program was established in an economic stimulus bill that was passed by the legislature and signed into law by Governor Romney on June 24, 2006 (Chapter 123 of the Acts of 2006). The MORE Jobs Capital Program may be used to fund public infrastructure requirements of business expansion and relocation projects that will enable a private investment to occur resulting in the creation of at least 100 new jobs in Massachusetts over a 24 month period. Other program requirements are that the project must generate substantial sales from outside the Commonwealth and the company must maintain the newly created jobs for at least five years. The grant can be used for public infrastructure such as roadways, sewer, utilities, water, wastewater, etc. The grant must be applied for jointly by the company and the municipality. The application and grant award must be approved by the Secretary of Economic Development and Housing. Grant monies will be made available to the municipality as a reimbursement for the capital costs of the public infrastructure project. The Evergreen Solar project will create 700 new jobs, and MOBD will recommend a grant of up to $10,000,000 to pay for any eligible public infrastructure required by the project. Community Development Action Grant (CDAG) The Community Development Action Grant Program (CDAG), funded by the Commonwealth, provides support for publicly owned or managed projects in areas where private investment will not otherwise occur without the CDAG grant. The goal is to stimulate economic development activities 6

that will attract and leverage private investment, create or retain long-term employment and revitalize distressed areas. Any city or town in the Commonwealth is eligible to apply to DHCD for CDAG funds. The amount of CDAG funding requested by the community must be the minimum amount necessary to make the project feasible and any benefit to private entities or individuals must be indirect and incidental and not the purpose of the project. CDAG can be used in a variety of ways, including installation, improvement, construction, repair, rehabilitation or reconstruction of buildings or other structures, facades, streets, roadways, thoroughfares, sidewalks, rail spurs, utility distribution systems, water and sewer lines, for site preparation and improvements, demolition of existing structures, and relocation assistance. A community may submit one individual application and/or one joint application for CDAG funding for the CDAG FY08 funding round. Individual CDAG awards are limited to a maximum of $1 million per project. The Evergreen Solar project is eligible to receive a CDAG grant of up to $1,000,000 for eligible public infrastructure costs. Public Works Economic Development Program (PWED) Grant The PWED Program provides grants to municipalities for the design and construction of roads and roadways and any other transportation related projects that support economic development. PWED grants are approved by the Executive Office of Transportation. Any city or town in the Commonwealth is eligible to apply to for PWED funds. There is a grant cap of $1,000,000 per project per municipality. The Evergreen Solar project is eligible to receive a PWED grant of up to $1,000,000 for eligible public roadway construction/upgrade costs. VII. Financing A total financing package of $15,000,000 for the private investment in building and equipment will be supplied by three sources MassDevelopment, Renewable Energy Trust (MTC), and Citizens Bank. All financing terms will be contingent upon satisfactory due diligence and contingent upon approval by the respective Boards of MassDevelopment and Massachusetts Technology Collaborative and successful underwriting by Citizen's Bank.
Mass Development Emerging Technology Fund

Loan Amount:

$5,000,000 (not to exceed 25% of total project cost) to be broken out as follows: $2,500,000 tied to Phase One and $2,500,000 tied to Phase Two Phase One Loan: $2,500,000 @ 4% Phase Two Loan: $2,500,000 @ Prime Rate 1% 7 years (first 18 months interest only with the outstanding principal to be amortized over the remaining 66 months) First position lien on the assets financed and a further lien on all business assets. If a separate entity holds the financed assets, a guarantee from the parent company would be required. The collateral is subject to further negotiation. Warrants (To Be Negotiated) 7

Interest rate:

Commitment Fee: Term:

Collateral:

Success Fee:

Approval:

Must receive formal approval by the MassDevelopment Board.

Renewable Enemy Trust (MTC) Loan Amount: $5,000,000 (not to exceed 25% of the project cost) to be broken out as follows: $2,500,000 tied to Phase One and $2,500,000 tied to Phase Two. Phase One Loan: $2,500,000 @ 4% Phase Two Loan: $2,500,000 @ Prime Rate 1% 7 years (first 18 months interest only with the outstanding principal to be amortized over the remaining 66 months) Same as MassDevelopment. Subject to further negotiations. Warrants (To Be Negotiated) Must receive formal approval by the Massachusetts Technology Collaborative Board

Interest rate:

Commitment Fee: Term:

Collateral: Success Fee: Approval:

Citizens Job Bank Program Economic Development Loan Loan Amount: $7,500,000 (provided that the amount is less than $40,000 per new job created within 36 months of the completion of the project and provided that the loan amount does not exceed 75% of total Project Costs). $5,000,000 4.99% (Job Bank Program) $2,500,000 @ 5.99% Annual costs of loan including title insurance premiums, recording fees, appraisal fees, environmental report fees, legal fees, etc. 5 years Fully Aortized (Interest only for first 18 months) Same as MassDevelopment. Subject to further negotiations. Warrants (To Be Negotiated) Approval of this Economic Development Loan by Citizens is subject to Citizens' normal underwriting guidelines and loan approval requirements and shall be documented on Citizens normal loan documentation.

Interest rate:

Fees:

Term: Collateral: Success Fee: Underwriting:

VIM Corporate Taxes Single Sales Factor Tax Apportionment 8

A potentially significant cost advantage in Massachusetts to manufacturers like Evergreen Solar is the "single sales factor" tax apportionment. For manufacturing corporations with multi-state tax filings, the single sales factor apportions state corporate income tax based solely on a ratio of in-state sales to total sales. Other states typically use more complicated apportionment formulas, which include not only the in-state sales ratio but also include the ratio of in-state payroll to total payroll and the ratio of in-state property to total property. The practical implication is that these states penalize companies that hold and add tangible assets and jobs in that state. For instance, California, New Jersey, and New Mexico all use multiple factor apportionment, which penalizes manufacturers for owning property and paying wages in-state. As manufacturers like Evergreen Solar expand their facilities and create new jobs in these states, the effective tax rate and the resultant tax burden for the company will likely increase. In Massachusetts, we welcome investments in people and property. In Massachusetts, such investments will have no negative impact on Evergreen Solar's corporate tax rate and tax burden. The long term tax savings from the single sales factor apportionment can often be very substantial and it is not unusual that the value of these savings can be more than the value of the rest of the incentives combined. Research and Development Tax Credit Massachusetts has the most favorable R&D tax incentive in the nation. In Massachusetts, any costs which would qualify for the Federal R&D tax credit are eligible for a 10% Massachusetts R&D Tax Credit. This credit can be used in addition to the Investment Tax Credit and can reduce tax liability to the minimum of $456 annually. In addition, a 15% R&D Tax Credit is available for costs related to donations and contributions made to research organizations such as hospitals and universities. The R&D credit cannot reduce a corporation's tax liability below the minimum $456 and cannot reduce any tax liability over $25,000 by more than 75%. However, a corporation may carry forward for an unlimited period of time any portion of the R&D credit which cannot be allowed in a particular tax year because of this limit. Sales and Use Tax Credit Massachusetts exempts all manufacturing equipment and all R&D equipment from sales and use taxes. Therefore, regardless of where Evergreen Solar purchases this equipment, Evergreen Solar will not pay the 5% MA sales tax nor the 5% MA use tax. Based on the same assumptions for machinery and equipment purchases that we made for the PPT exemption (see Exhibit 2), we estimate the total machinery and equipment purchases over the 20-year project life to be $200 million. We assumed that all of this machinery and equipment is for the purposes of R&D and/or manufacturing. Based on these assumptions, over the 20-year project period, the sales and use tax exemption savings could be as high as $10,000,000 ($200,000,000 x .05).

IX. Workforce and Training Workforce Training Fund (WTF) The Massachusetts Business Resource Team will assist Evergreen Solar in applying for workforce training grants via the Massachusetts Workforce Training Fund (WTF). The WTF provides grants to train new employees or to upgrade the skills of existing employees. The WTF has no income requirements and is especially applicable to Evergreen Solar's more technically skilled workers. Companies applying to the program for the first time receive preference. Companies can receive 9

multiple grants. This flexible program requires a company match that can be met by "in-kind" expenses incurred in providing the training. Typically, applicants meet the match through the salaries of employees as they provide or receive the training that is funded by the grant. The grant cap on the WTF is $1 million per company per year. Historically, grants have usually averaged out to approximately $1,100 per employee. However, for more technology driven industries like life sciences, grants have averaged closer to $1,600 per employee. Based on the number of 310 current employees and projections to add 700 new employees and given the highly technical skill requirements for training, Evergreen Solar could very possibly qualify for a Workforce Training Fund Grant of up to $1,000,000 (1,010 employees x $999/employee). These grant monies would be set up in an account and could be used over a two-year period. A grant from the Workforce Training Fund requires approval of the Workforce Advisory Board. The Commonwealth Corporation will provide free application assistance to save you time and money and to help ensure that the final application has a higher likelihood of approval.

The HIT Grant The Hiring Incentive Training (HIT) Grant Program is open to all employers. It provides training grants of up to $2,000 per employee and up to $30,000 a year per company. This program assists in paying training costs for newly hired employees who have been unemployed over a year and those that do not have a call back date from their last employer. Assuming that 10% of the new hires meet the HIT criteria, the potential value of the HIT grant to Evergreen Solar could be as high as $140,000 (700 new hires x 10% x $2,000). Workforce Assistance Upon site identification, the Department of Workforce Development can facilitate curriculum development or program design at the nearby community college or technical school to ensure access to the training your workforce needs. Once you are ready to hire, DWD's Division of Career Service can assist with providing targeted recruitment and prospective employee screening at one of our 32 One Stop Career Centers across the Commonwealth. DWD is ready to be an active partner in the education and training of your workforce in Massachusetts.

X.

Land Cost Savings

MTC Site in Westborough The Commonwealth of Massachusetts is proposing that Phases One and Two of the Evergreen Solar project be located at a publicly owned 13-16 acre parcel in Westborough, Massachusetts adjacent to the Massachusetts Technology Collaborative (MTC) parcel. If the project is constructed at this site, Evergreen Solar could realize up to $3,000,000 in savings by avoiding land acquisition costs. MTC would retain public ownership of the land and lease the land to Evergreen Solar at a nominal rate for up to 30 years.

10

XI. Real Estate Tax Savings MTC Site in Westborough In the initial proposal that was submitted to Evergreen Solar for Phase One only, the assumed real estate tax rate rate was $25.00/$1,000 AV. That tax rate was based on the City of Marlborough's tax rate. The current proposal to locate the project at the MTC site in Westborough will result in a substantial real estate tax savings. Westborough has a single classification real estate tax rate of $13.66/$1,000 AV. We assumed that the real estate tax rates will remain constant over the 20-year project period. For the current project combining Phases One and Two, the real estate tax savings generated by this rate differential will be $24,376,804 (see Exhibit 3).

11

XII. Massachusetts Its All Here Leading Renewable Energy Cluster o Governor Patrick's commitment to bold initiatives to build the renewable energy sector o Energy efficiency and renewable energy sectors employ 10,000 in Massachusetts o Massachusettts has world leading cluster of renewable energy companies o Massachusetts has 60 renewable energy companies employing more than 3,000 o Massachusetts Technology Collaborative (Renewable Energy Trust) o Well established supply chain right here in Massachusetts o Next generation renewable energy research being done by nine universities in MA World Class Workforce o Highest concentration of bachelors and masters degrees in the country o Highest concentration of science and engineering degrees in the country o Ranked 2nd nationally in worker productivity o Large, highly skilled, experienced workforce in energy and technology sectors #1 Education System in the Country Postsecondary and Public Schools (K-12) o Three of the top fifteen research universities (measured by technology licensing revenues) in the country (University of Massachusetts, Harvard, MIT) o Highest concentration of college students in the country
Public Schools o # .1 nationally in SAT assessment test scores in math and #2 in verbal o # 1 nationally in NEA assessment test scores in both math and reading

I-495/Central Massachusetts corridor strikes a balance between access to a highly skilled workforce, affordability, and access to major highways, airports, and rail transportation o Located in the heart of the technology sector workforce in MA o Located only 10 minutes from the Marlborough facility and next door to MTC o Westborough is at intersection of 1-495, Mass Pike, and Rte. 9 o Within 60 miles of nearly every major postsecondary institution in Massachusetts. o Within 45 minutes of Logan International Airport o Direct commuter rail direct service to Boston and Worcester o Cost of Living Index of Central Massachusetts is 50%-70% lower than Boston Excellent Quality of Life to Attract and Retain Professional and Technical Personnel o Proximity to great public schools Westborough and neighboring Shrewsbury, Northborough and Southborough all among top 25 school systems in the state o Very low violent crime rate o Within 35 miles of five of top hospitals in the country (Mass General, Brigham and Women's, Dana Farber, Beth Israel Deaconess, and Children's Hospital) 45 minutes to the history of Boston or the seashore, 2 hours to world-class skiing o o Home of the world renowned Boston Symphony and Boston Pops o Home of the World Champion New England Patriots and Boston Red Sox 12

NEW ECONOMY INDEX' (1=HIGHEST, 50=LOWEST) Other States V. Massachusetts NM NY OR MA 11 1 27 10 Overall State Ranking 11 7 3 25 Knowledge Jobs 21 37 Economic Dynamism 17 3 14 6 1 41 Digital Economy 14 18 1 7 Innovation Capacity 12 1 15 18 High Tech Jobs Source: Progressive Policy Institute Milken Science and Technology Index2 2002 1 7 20 23 2004 1 7 14 19 Rank Change 0 0 6 4 Score 84.35 69.03 61.75 57.76

Massachusetts New York New Mexico Oregon

Footnotes:

2The 2004 State Technology and Science Index encapsulates each state's comprehensive inventory of technology and science assets that can be leveraged to promote economic development.

The Index provides states with a benchmark, monitors their technology progress and can be leveraged to promote economic growth. It provides a valuable framework of measures to guide state policy makers and the public on the realities of their performance in the knowledge-based economy of today. "Places that can attract, grow and retain firms and industries proficient at deploying information technology, in addition to producing it, will be at a competitive advantage," the report says. "The degree to which a state's knowledge assets are harnessed and converted into successful innovations, products and services determine its economic future."

Please feel free to contact us with any questions regarding the proposal or to let us know what we can do to further assist Evergreen Solar on this important decision. The Commonwealth of Massachusetts and its partners look forward to working with Evergreen Solar to make its new manufacturing facility in Massachusetts a large success.

Arthur P. Robert Industry Director, Renewable Energy Massachusetts Office of Business Development

13

EVERGREEN SOLAR PHASE 2 PROJECTED INCENTIVES, VS. PHASE 1 GRANTS Massacbuetts Technology Collaborative Special Grant Massachusetts Technology Large ensile Renewables Initiative Grant MORE JOBS Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Workforce Training Fund Grant Hiring Incentive Training (HIT) Grant TAX INCREMENT FINANCING Real Estate Tax Exemption Savings "TIP' (EDIP) *" 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIT') TAX INCENTIVES Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) FINANCING MTC's Business Expansion Initiative (BEI) MassDevelopment's Emerging Techology Fund (ETF) Citizen's Job Bank Financing - Interest Savings OTHER Land Costs Savings OTHER CRITICAL ADVANTAGES High Accessibility High-Quality Workforce High-Quality Education System Governor's Commitment to Renewable Energy A Leading Innovation Economy High Quality of Life PHASE 1 $ 10,000,000 $ 500,000 S 10,000,000 $ 1,000,000 $ 1,000,000 S 1,000,000 S 36,000 PHASE 2 S $ S S S S $ PHASE 2 NOTES

Not a credible offer 1,000,000 Maybe? To Devens? 525,000 A realistic value 30,000

S 705,195 $ 10,770,910 S 7,500,000

$655,673 Assumes 5% over 20 years $11,243,000 Different Rate 7,000,000

S 10,000,000 TBD TBD

9,300,000 TBD TBD

$ $ S $

5,000,000 5,000,000 $ 7,500,000 up to $ 2,593,080

5,600,000 Probably nut interested

S 2,400,000

N/A

Total Estimated Value of Proposal Italics Projected

$ 74,999 185

34,753.673

Assumptions: * Roughly doubling the project * Projected investment 5140.000,000, or 93% of Phase 1 * Costs & benefits reduced in proportion

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT
Internet: http://wwvv.mass.goviecon

DEVAL PATRICK
GOVERNOR

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

March 26, 2007 I am pleased to provide you with the Commonwealth's Preliminary Incentives, Financing, and Savings Proposal to Evergreen Solar valued at up to 5110,786,941 to effect the location of its new manufacturing facility at the MTC site in Westborough, Massachusetts. The proposal includes grants, tax exemptions, tax credits, cost offsets, financing, and identified savings. Assumptions used to calculate the savings and incentives are detailed in each section. The incentives and savings provided herein are predicated on information provided to us by Evergreen Solar regarding project investment, employment, environmental impact, and timing parameters, and are subject to change should revisions be made to these criteria. For purposes of this proposal, we have calculated our economic development incentives, financing, and savings based upon the following assumptions:
Capital Investment Total Project Jobs Created Jobs Retained Dates of Construction

$150,00,000

400

310

2007-2008

Attached, you will find: 1) aummary proposal, 2) a description of each of the programs and the method/assumptions used to calculate the savings, and 3) additional data regarding the Massachusetts advantages. We are confident that our highly skilled workforce, world leading educational system, innovative economy, leading technology industry cluster, strong state and local government support, a vigorous commitment by Governor Patrick to grow the renewable energy sector, and a strong incentives package will provide Evergreen Solar with the ideal environment in which to thrive. Please call Mr. Art Robert if you have any questions regarding the proposal. The Commonwealth of Massachusetts is enthusiastically committed to working with Evergreen Solar to assist you in a successful startup of your new manufacturing facility in Massachusetts.

Sincerely,

Robert Coughlin Undersecretary for Business Development (617) 788-3688

1

Arthur P. Robert Industry Director, Renewable Energy Tel. (617) 788-3656

I. Summary - MA Estimated Incentives, Savings, and Financing Proposal

Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Land Cost Savings Real Estate Tax Savings (vs. Preliminary Proposal) Workforce Training Fund Grant HIT Grant Real Estate Tax Exemption Savings "TIF" (EDIP) ** 100% Personal Property Tax Exemption (EDIP) * 5% Investment Tax Credit (EDIP) Sales and Use Tax Exemptions Single Sales Tax Factor
estimated savings $ $

10,000,000 500,000

10,000,000 1,000,000 1,000,000

$ $ $

3,000,000 24,376,804 1,000,000 140,000 1,468,197 16,255,400 13,000,000 10,000,000 TBD TBD

Research & Development Tax Credit (10-15%) Financing Principal (MDFA, MTC, and Citizens) FinancingEstimated Interest Savings *** Total Estimated Value of Proposal
****

17,500,000 2,593.080 110,786,941

S S

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) ** Assumes a negotiated TIP that gives an average 5% exemption for 20 years per the attached schedule (Exhibit 1). The actual exemption percentage and project period will be negotiated between Westborough and Evergreen. Solar . This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/$1,000 AV, *** MDFA & RET savings vs. 8.25% rate, Citizens savings vs. 7.99% rate **** Includes grants, tax credits, offsets, identified savings, than principal and interest savings

COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT
ONE ASHBURTON PLACE SUITE 2101 BOSTON, MA 02108
TELEPHONE 617-788-3670 FAX: 617-788-3695 Internet: http://www.mass.govimobd

DEVAL PATRICK
. GOVERNOR

DANIEL O'CONNELL
SECRETARY OF HOUSING AND ECONOMIC DEVELOPMENT

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

Commonwealth of Massachusetts Incentives, Savings, and Financing Proposal Prepared exclusively for Evergreen Solar March 26, 2007

ROBERT COUGHLIN
UNDERSECRETARY OF BUSINESS DEVELOPMENT

This proposal outlines the general terms of the incentives, savings, and financing package being offered by Massachusetts to Evergreen Solar to assist with the location construction of a new manufacturing facility in Westborough. Massachusetts. This offer is subject to the successful completion of applications as noted and compliance with program requirements. The incentives related to the Economic Development Incentive Program are subject to negotiation with and approval by the town of Westborough. In order to be eligible for the Economic Development Incentive Program, Evergreen Solar must locate the facility in an ETA designated municipality. Approval of grants from the Workforce Training Fund are subject to completion and submission of a complete application by the company and approval by the WTF Advisory Board.

H. General Information
a) Contact Information: Mr. Richard Chleboski VP Worldwide Expansions Evergreen Solar MTC Site in Westborough, Massachusetts Manufacturing of solar cells and panels

b) Proposed Project Location: c) Type of Business:

III. Project Overview Description To support the growth in its business, Evergreen Solar plans to build a new 500,000 s.f. manufacturing facility. Evergreen Solar plans to invest $150,000,000 for real estate, building construction, and equipment at the site. Phase one of the project will create 400 new jobs and $150 million in private investment. Evergreen envisions, but is not committed to, a second phase at the site. That phase would create an additional 300 jobs and an additional private investment of $110,000,000 million. Company Employment Plan In addition to retaining the 310 jobs currently located at their Marlborough facility, Evergreen Solar will add 400 new jobs at an average salary of $51,000.

IV. Job Creation and Investment Incentives Economic Development Incentive Program (EDIP1

Through the EDIP, designated Economic Target Area (ETA) communities, in partnership with the Commonwealth, can provide 1) real estate property tax exemptions, 2) personal property tax exemptions, and 3) investment tax credits to businesses locating to or expanding in the community. The EDIP is a three-way partnership between the state, the municipality and the participating job creating business. EDIP

How it Works
The municipality makes available local Tax Increment Financing (TIF) - a negotiated real estate tax exemption based on a percentage of the value added through renovation or new construction. The duration of the TIF is for a period of no less than five years and no more than twenty years. The terms of the TIF are negotiated between the property owner seeking the benefits of the EDIP and the municipality . The state does not participate in that negotiation. In addition to the negotiated TT real estate property tax exemption, the business would automatically receive a 100% personal property tax exemption on the site for the life of the project.

To qualify for the EDIP incentives a participating business must become a "Certified Project". As part of the Certified Project, the business must agree to create at least one permanent full-time, net new Massachusetts job. As part of the Certified Project, the business also agrees to a specific level of private investment and job retention where applicable. Upon municipal approval, and then the approval of the Economic Assistance Coordinating Council (EACC), the state makes available a 5% investment tax credit known as the 5% Economic Opportunity Area Credit.

Illustrative Example of EDIP and Hypothetical Savings 4

Real Estate Property Tax Exemption Savings The terms of the TIF agreement are to be determined through negotiation between Westborough and Evergreen Solar. For illustration purposes only (to demonstrate how the TIF works), we have assumed the new building of 500,000s.f. will result in an incremental value of $80,000,000 ($160 per s.f.). We assumed that this value will increase by 3% annually. We used Westborough's current commercial real estate tax rate of $13.66/$1,000 AV. Therefore, there will be an initial incremental annual real estate tax liability of $1,092,800. This liability will grow 3% annually. If we assume that the negotiated TIF is for 20-years and provides an annual exemption of 5%, then the total savings from the real estate property tax exemption (TIF) over the 20-year life of the project will be $1,468,197 (see attached Exhibit I TIF Spreadsheet). Please note that this illustration is not a proposal from any municipality and that the actual terms of a TIF, including the length of the TIF period, must be negotiated between Evergreen Solar and the town of Westborough. Westborough is not currently an ETA municipality and would have to become one by approving the ETA designation and receiving approval from the EACC before offering a TIF. Personal Property Tax Savings As a Certified Project with a TIF agreement, Evergreen Solar will automatically qualify for a 100% exemption on personal property taxes over the 20 year life of the project at this site. Beyond the 20-year project period, as a manufacturing corporation in Massachusetts, Evergreen Solar will qualify for a 100% exemption on personal property taxes on all manufacturing equipment. Based on the numbers provided by Evergreen Solar, there will be $160,000,000 in tangible depreciable assets (equipment) at the new facility. We assumed that these would be depreciated on a straightline basis over 10 years. We then assumed that an additional $2 million of equipment would be purchased annually and also depreciated over a ten year period. We assumed the personal property tax rate to be $15.0051,000 in value. Over the 20-year life of the project, the total Personal Property Tax exemption savings is estimated to be $16,255,400 (see attached Exhibit 2 Personal Property Tax Exemption Spreadsheet). Commonwealth of Massachusetts Investment Tax Credit Successful completion of the EDIP process, as outlined above, will facilitate the extension of an EOA Investment Tax Credit (EOA-ITC) of 5% to Evergreen Solar as a "Certified Project". The EOA-ITC can be utilized by the certified project business during the entire term of the TIF agreement between the property owner and the municipality (in this example 20 years). Based on the 5260,000,000 investment in real estate, equipment, and facilities provided to us by Evergreen Solar and assuming all of these qualify for the investment tax credit, the total 5% Investment Tax Credit will be $13,000,000. This amount can be applied directly against any Massachusetts tax obligation (though use of the EOA-ITC cannot in any single year reduce Massachusetts tax liability by greater than 50%). Unused credits may be carried forward to subsequent years over the 20-year life of the project (through 2026). Our assumption is that Evergreen Solar will be in a position to fully utilize the available credits during the 20-year project life.

V. Renewable Energy Trust (MTC) Grants Massachusetts Technology Collaborative Special Grant The Massachusetts Technology Collaborative (MTC) through its Renewable Energy Trust (RET) will provide a $10,000,000 grant to be used to offset the costs of construction and equipment for Evergreen Solar's new manufacturing facility. In return, Evergreen Solar must commit to creating 400 new incremental full-time jobs at the new Massachusetts facility (above and beyond the 310 jobs currently employed in Massachusetts) over a 24 month period from completion of construction and. Evergreen Solar must commit to an investment of $150 million in the new facility for real estate, construction, and equipment. The new jobs created must be sustained over a five year period. The grant and its terms must be approved by the MTC Board. MTC LORI Grant The Massachusetts Technology Collaborative (MTC), as administrator of the Renewable Energy Trust Fund (the Trust), is seeking applications for the Large Onsite Renewables Initiative to expand the production and use of distributed renewable energy technologies in Massachusetts. MTC seeks to develop a diverse portfolio of renewable energy projects across a variety or locations, technologies, and building types. Round 3, has approximately $3.5 million available. Applicants will be subject to a competitive selection process. LORI. applicants may request funding in two activity areas: Feasibility Study Grants and. Design & Construction Grants. During open solicitation rounds, LORI will accept grant applications for development of eligible renewable energy projects(s) with greater than 10 kilowatts of nameplate capacity that are located at commercial, industrial, institutional. and public facilities that will consume more than 25% of the renewable energy generated- by the project' onsite. The applicant and project site(s) must he a customer of a Massachusetts investor-owned electric distribution utility. The grant awards may be used to facilitate the installation of renewable energy projects on existing buildings (retrofits) or in conjunction with new construction/major renovation projects, including green buildings. MTC leadership has recommended that a $500,000 grant be provided to the Evergreen Solar project through the LORI program. The grant award must be approved by the MTC Board. VI. Infrastructure Grants MORE Jobs Capital Program The MORE Jobs Capital Program was established in an economic stimulus bill that was passed by the legislature and signed into law by Governor Romney on June 24, 2006 (Chapter 123 of the Acts of 2006). The MORE Jobs Capital Program may be used to fund public infrastructure requirements of business expansion and relocation projects that will enable a private investment to occur resulting in the creation of at least 100 new jobs in Massachusetts over a 24 month period. Other program requirements are that the project must generate substantial sales from outside the Commonwealth and the company must maintain the newly created jobs for at least five years. The grant can be used for public infrastructure such as roadways, sewer, utilities, water, wastewater, etc. The grant must be applied for jointly by the company and the municipality. The application and grant award must be approved by the Secretary of Economic Development and Housing. Grant monies will be made available to the municipality as a reimbursement for the capital costs of the public infrastructure project. The Evergreen Solar project will create 700 new jobs, and MOBD will recommend a grant of up to $10,000,000 to pay for any eligible public infrastructure required by the project. 6

Community Development Action Grant (CDAG) The Community Development Action Grant Program (CDAG), funded by the Commonwealth, provides support for publicly owned or managed projects in areas where private investment will not otherwise occur without the CDAG grant. The goal is to stimulate economic development activities that will attract and leverage private investment, create or retain long-term employment and revitalize distressed areas. Any city or town in the Commonwealth is eligible to apply to DHCD for CDAG funds. The amount of CDAG funding requested by the community must be the minimum amount necessary to make the project feasible and any benefit to private entities or individuals must be indirect and incidental and not the purpose of the project. CDAG can be used in a variety of ways, including installation, improvement, construction, repair, rehabilitation or reconstruction of buildings or other structures, facades, streets, roadways, thoroughfares, sidewalks, rail spurs, utility distribution systems, water and sewer lines, for site preparation and improvements, demolition of existing structures, and relocation assistance. A community may submit one individual application and/or one joint application for CDAG funding for the CDAG FY08 funding round. Individual CDAG awards are limited to a maximum of $1 million per project. The Evergreen Solar project is eligible to receive a CDAG grant of up to $1,000,000 for eligible public infrastructure costs. Public Works Economic Development Program (PWED) Grant The PWED Program provides grants to municipalities for the design and construction of roads and roadways and any other transportation related projects that support economic development. PWED grants are approved by the Executive Office of Transportation. Any city or town in the Commonwealth is eligible to apply to for PWED funds. There is a grant cap of $1,000,000 per project per municipality. The Evergreen Solar project is eligible to receive a PWED grant of up to $1,000,000 for eligible public roadway construction/upgrade costs.

VII. Financing A total financing package of $17,500,000 for the private investment in building and equipment will be supplied by three sources MassDevelopment, Renewable Energy Trust (MTC), and Citizens Bank. All financing terms are contingent upon satisfactory due diligence and further negotiations. Awards, are contingent upon approval by the respective Boards of MassDevelopment and Massachusetts Technology Collaborative and successful underwriting by Citizen's Bank. Mass Development Emerging Technology Fund

Loan Amount:

$5,000,000, all available to support phase 1. Limited to 25% of total project cost. All advances on equipment limited to 85% of invoice cost. 6% 1% 7 years (first 18 months interest only) with the outstanding principal to be amortized over the remaining 66 months 7

Interest rate: Commitment Fee: Term:

Liquidity Covenant: To be negotiated Collateral: First position lien on the assets financed and a further lien on all business assets. If a separate entity holds the financed assets, a guarantee from the parent company would be required. MassDevelopment and MTC will share in a warrant package based on one year's worth of interest on the loan, divided by the average trading price of the stock for the last 90 days. Whatever the average priced is determined will be divided into the interest value to determine how many shares of common stock the warrant package will provide. The exercise price of the warrants will be the 90 day average and the term of the agreement will be for 10 years. Must receive formal approval by the MassDevelopment Board.

Success Fee:

Approval:

Renewable Energy Trust (MTC) Loan Amount: $5,000,000, all available to support phase I (not to exceed 25% of the project cost). 6% I% 7 years (first 18 months interest only with the outstanding principal to be amortized over the remaining 66 months)

Interest rate: Commitment Fee: Term:

Liquidity Covenant: To be negotiated. Collateral: Success Fee: Approval: Same as MassDevelopment. Subject to further negotiations. Warrants, same terms as for MassDevelopment (see above). Must receive formal approval by the Massachusetts Technology Collaborative Board

Citizens Job Bank Program Economic Development Loan Citizens Bank offers the following terms, contingent on additional negotiations and underwriting terms, summarized below: Loan Amount: $7,500,000, all available to support phase I (Provided Evergreen certifies that the amount is less than $40,000 per new job created within 36 months

of the completion of the project and provided that the loan amount does not exceed 75% of total project costs). Interest rate: $5,000,000 @ 4.99% $2,500,000 @ 5.99%

Term:

5 year note, fully amortized in five years. Twenty year option, provided Evergreen executes a land lease with a minimum 20 year term.

Liquidity Covenant: To be negotiated. Collateral: First position on all business assets, including assignment of land lease and mortgage on leasehold improvements. A "carve out" for intellectual property to be negotiated Approval of this Economic Development Loan by Citizens is subject to Citizens' normal underwriting guidelines and loan approval requirements and execution of documentation satisfactory to the bank and its legal counsel.

Underwriting:

VIII. Corporate Taxes

Single Sales Factor Tax Apportionment A potentially significant cost advantage in Massachusetts to manufacturers like Evergreen Solar is the "single sales factor" tax apportionment. For manufacturing corporations with multi-state tax filings, the single sales factor apportions state corporate income tax based solely on a ratio of instate sales to total sales. Other states typically use more complicated apportionment formulas, which include not only the in-state sales ratio but also include the ratio of in-state payroll to total payroll and the ratio of in-state property to total property. The practical implication is that these states penalize companies that hold and add tangible assets and jobs in that state. For instance, California, New Jersey, and New Mexico all use multiple factor apportionment, which penalizes manufacturers for owning property and paying wages in-state. As manufacturers like Evergreen Solar expand their facilities and create new jobs in these states, the effective tax rate and the resultant tax burden for the company will likely increase. In Massachusetts, we welcome investments in people and property. In Massachusetts, such investments will have no negative impact on Evergreen Solar's corporate tax rate and tax burden. The long term tax savings from the single sales factor apportionment can often be very substantial and it is not unusual that the value of these savings can be more than the value of the rest of the incentives combined. Research and Development Tax Credit

Massachusetts has the most favorable R&D tax incentive in the nation. In Massachusetts, any costs which would qualify for the Federal R&D tax credit are eligible for a 10% Massachusetts R&D Tax Credit. This credit can be used in addition to the Investment Tax Credit and can reduce tax liability to the minimum of $456 annually. In addition, a 15% R&D Tax Credit is available for costs related to donations and contributions made to research organizations such as hospitals and universities. The R&D credit cannot reduce a corporation's tax liability below the minimum 9

$456 and cannot reduce any tax liability over $25,000 by more than 75%. However, a corporation may carry forward for an unlimited period of time any portion of the R&D credit which cannot be allowed in a particular tax year because of this limit. Sales and Use Tax Credit Massachusetts exempts all manufacturing equipment and all R&D equipment from sales and use taxes. Therefore, regardless of where Evergreen Solar purchases this equipment, Evergreen Solar will not pay the 5% MA sales tax nor the 5% MA use tax. Based on the same assumptions for machinery and equipment purchases that we made for the PPT exemption (see Exhibit 2), we estimate the total machinery and equipment purchases over the 20-year project life to be $200 million. We assumed that all of this machinery and equipment is for the purposes of R&D and/or manufacturing. Based on these assumptions, over the 20-year project period, the sales and use tax exemption savings could be as high as $10,000,000 ($200,000,000 x .05).

IX. Workforce and Training Workforce Training Fund (WTF) The Massachusetts Business Resource Team will assist Evergreen Solar in applying for workforce training grants via the Massachusetts Workforce Training Fund (WTF). The WTF provides grants to train new employees or to upgrade the skills of existing employees. The WTF has no income requirements and is especially applicable to Evergreen Solar's more technically skilled workers. Companies applying to the program for the first time receive preference. Companies can receive multiple grants. This flexible program requires a company match that can be met by "in-kind" expenses incurred in providing the training. Typically, applicants meet the match through the salaries of employees as they provide or receive the training that is funded by the grant. The grant cap on the WTF is $1 million per company per year. Historically, grants have usually averaged out to approximately $1,100 per employee. However, for more technology driven industries like life sciences, grants have averaged closer to $1,600 per employee. Based on the number of 310 current employees and projections to add 400 new employees and given the highly technical skill requirements for training, Evergreen Solar could very possibly qualify for a Workforce Training Fund Grant of up to $1,000,000 (710 employees x $1,600/employee). These grant monies would be set up in an account and could be used over a two-year period. A grant from the Workforce Training Fund requires approval of the Workforce Advisory Board. The Commonwealth Corporation will provide free application assistance to save you time and money and to help ensure that the final application has a higher likelihood of approval. The HIT Grant The Hiring Incentive Training (HIT) Grant Program is open to all employers. It provides training grants of up to $2,000 per employee and up to $30,000 a year per company. This program assists in
paying training costs for newly hired employees who have been unemployed over a year and those

that do not have a call back date from their last employer. Assuming that 10% of the new hires meet the HIT criteria, the potential value of the HIT grant to Evergreen Solar could be as high as $140,000 (700 new hires x 10% x $2,000). 10

Workforce Assistance

Upon site identification, the Department of Workforce Development can facilitate curriculum development or program design at the nearby community college or technical school to ensure access to the training your workforce needs. Once you are ready to hire, DWD's Division of Career Service can assist with providing targeted recruitment and prospective employee screening at one of our 32 One Stop Career Centers across the Commonwealth. DWD is ready to be an active partner in the education and training of your workforce in Massachusetts.

X.

Land Cost Savings

MTC Site in Westborough

The Commonwealth of Massachusetts is proposing that Phases One and Two of the Evergreen Solar project be located at a publicly owned 13-16 acre parcel in Westborough, Massachusetts adjacent to the Massachusetts Technology Collaborative (MTC) parcel. If the project is constructed at this site, Evergreen Solar could realize up to $3,000,000 in savings by avoiding land acquisition costs. MTC would retain public ownership of the land and lease the land to Evergreen Solar at a nominal rate for up to 30 years. XI. Real Estate Tax Savings

MTC Site in Westborough

In the initial proposal that was submitted to Evergreen Solar for Phase One only, the assumed real estate tax rate was $25.00/$1,000 AV. That tax rate was based on the City of Marlborough's tax rate. The current proposal to locate the project at the MTC site in Westborough will result in a substantial real estate tax savings. Westborough has a single classification real estate tax rate of $13.6651.000 AV. We assumed that the real estate tax rates will remain constant over the 20-year project period. For the current project combining Phases One and Two, the real estate tax savings generated by this rate differential will be $24,376,804 (see Exhibit 3).

XII. Massachusetts Its All Here Leading Renewable Energy Cluster o Governor Patrick's commitment to bold initiatives to build the renewable energy sector o Energy efficiency and renewable energy sectors employ 10,000 in Massachusetts o Massachusetts has world leading cluster of renewable energy companies o Massachusetts has 60 renewable energy companies employing more than 3,000 o Massachusetts Technology Collaborative (Renewable Energy Trust) o Well established supply chain right here in Massachusetts o Next generation renewable energy research being done by nine universities in MA

11

World Class Workforce o Highest concentration of bachelors and masters degrees in the country o Highest concentration of science and engineering degrees in the country o Ranked 2nd nationally in worker productivity o Large, highly skilled, experienced workforce in energy and technology sectors #1 Education System in the Country -- Postsecondary and Public Schools (K-12) o Three of the top fifteen research universities (measured by technology licensing revenues) in the country (University of Massachusetts, Harvard, MIT) o Highest concentration of college students in the country
Public Schools o # I nationally in SAT assessment test scores in math and #2 in verbal o # I nationally in NEA assessment test scores in both math and reading

I-495/Central Massachusetts corridor strikes a balance between access to a highly skilled workforce, affordability, and access to major highways, airports, and rail transportation o Located in the heart of the technology sector workforce in MA o Located only 10 minutes from the Marlborough facility and next door to MTC o Westborough is at intersection of 1-495, Mass Pike, and Rte. 9 o Within 60 miles of nearly every major postsecondary institution in Massachusetts. o Within 45 minutes of Logan International Airport o Direct commuter rail direct service to Boston and Worcester o Cost of Living Index of Central Massachusetts is 50%-70% lower than Boston Excellent Quality of Life to Attract and Retain Professional and Technical Personnel o Proximity to great public schools Westborough and neighboring Shrewsbury, Northborough and Southborough all among top 25 school systems in the state o Very low violent crime rate o Within 35 miles of five of top hospitals in the country (Mass General, Brigham and Women's, Dana Farber, Beth Israel Deaconess, and Children's Hospital) o 45 minutes to the history of Boston or the seashore, 2 hours to world-class skiing o Home of the world renowned Boston Symphony and Boston Pops o Home of the World Champion New England Patriots and Boston Red Sox NEW ECONOMY INDEX 1 (1=HIGHEST, 50=LOWEST) Other States V. Massachusetts NM NY OR MA 10 11 1 27 Overall State Ranking 3 25 11 7 Knowledge Jobs 37 21 17 3 Economic Dynamism 6 1 41 14 Digital Economy 7 14 1 18 Innovation Capacity 12 1 15 18 High Tech Jobs Source: Progressive Policy Institute

12

Milken Science and Technology Index2 2002 1 7 20 23 2004 1 7 14 19 Rank Change 0 0 6 4 Score 84.35 69.03 61.75 57.76

Massachusetts New York New Mexico Oregon

Footnotes:

'The 2004 State Technology and Science Index encapsulates each state's comprehensive inventory of technology and science assets that can be leveraged to promote economic development. The Index provides states with a benchmark, monitors their technology progress and can be leveraged to promote economic growth. It provides a valuable framework of measures to guide state policy makers and the public on the realities of their performance in the knowledge-based economy of today. "Places that can attract, grow and retain firms and industries proficient at deploying information technology, in addition to producing it, will be at a competitive advantage," the report says. "The degree to which a state's knowledge assets are harnessed and converted into successful innovations, products and services determine its economic future."

Please feel free to contact us with any questions regarding the proposal or to let us know what we can do to further assist Evergreen Solar on this important decision. The Commonwealth of Massachusetts and its partners look forward to working with Evergreen Solar to make its new manufacturing facility in Massachusetts a large success.

Arthur P. Robert Industry Director, Renewable Energy Massachusetts Office of Business Development (617) 788-3656

13

COMMONApil OF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT
Internet: http://www.mass.govlecon

DEVAL PATRICK
GOVERNOR

TIMOTHY MURRAY

DRAFT
June 15, 2007

LIEUTENANT GOVERNOR

I am pleased to provide you with the Commonwealth's Preliminary Incentives, Financing, and Savings Proposal to Evergreen Solar valued at up to $74,999,185 to effect the location of its new manufacturing facility at Devens, Massachusetts. The proposal includes grants, tax exemptions, tax credits, cost offsets, financing, and identified savings. Assumptions used to calculate the savings and incentives are detailed in each section. The incentives and savings provided herein are predicated on information provided to us by Evergreen Solar regarding project investment, employment, environmental impact, and timing parameters. Valued described herein are subject to change, should Evergreen Solar change this project information. For purposes of this proposal, we have calculated our economic development incentives, financing, and savings based upon the following assumptions:
Capital Investment
Total Project $150,000,000

Jobs
Created 350

Jobs
Retained 310

Dates of
Construction 2007-2008

Attached, you will find: 1) a summary proposal, 2) a description of each of the programs and the method/assumptions used to calculate the savings, and 3) additional data regarding the Massachusetts advantages. We are confident that our highly skilled workforce, world leading educational system, innovative economy, leading technology industry cluster, strong state and local government support, a vigorous commitment by Governor Patrick to grow the renewable energy sector, and a strong incentives package will provide Evergreen Solar with the ideal environment in which to thrive. Please call Mr. Art Robert if you have any questions regarding the proposal. The Commonwealth of Massachusetts is enthusiastically committed to working with Evergreen Solar to assist you in a successful startup of your new manufacturing facility in Massachusetts.

Sincerely,

Robert Coughlin
Undersecretary of Business Development (617) 788-3688

Arthur P. Robert Industry Director, Renewable Energy Tel. (617) 788-3656

DRAFT

DRAFT

I. Summary - MA Estimated Incentives, Savings, and Financing Proposal

GRANTS Massachusetts Technology Collaborative Special Grant Massachusetts Technology Collaborative LORI Grant MORE Jobs Infrastructure Grant CDAG Infrastructure Grant PWED Infrastructure Grant Workforce Training Fund Grant Hiring Incentive Training (HIT) Grant TAX INCREMENT FINANCING Real Estate Tax Exemption Savings "TIF" (EDIP) 100% Personal Property Tax Exemption (EDIP) 5% Investment Tax Credit (EDIP) TAX INCENTIVES Sales and Use Tax Exemptions Single Sales Tax Factor estimated savings Research & Development Tax Credit (10-15%) FINANCING Financing Principal (MDFA, MTC, and Citizens) Financing Estimated Interest Savings *** OTHER Land Cost Savings

$ $ $ S $ $

10,000,000 500,000 10,000,000 1,000,000 1,000,000 1,000,000 30,000

**

$ 705,195 $ 10,770,910 $ 7,500,000

$ 10,000,000 TBD TBD

S 17,500,000 S 2,593,080

2,400,000

Total Estimated Value of Proposal ****

S 74,999,185

* Personal Property Tax exemption savings over 20-year project period (see Exhibit 2) '* Assumes a negotiated TIF that gives an average 5% exemption for 20 years per the attached schedule (Exhibit I). The actual exemption percentage and project period will be negotiated between Doyens and Evergreen Solar. This number is for illustrative purposes only and does not represent a proposal from any specific municipality. We assumed the incremental value of the building to be $80,000,000 and the real estate tax rate to be $13.66/51,000 AV. *** MDFA & RET savings vs. 8.25% rate, Citizens savings vs. 7.99% rate **** Includes grants. tax credits, offsets, identified savings, loan principal and interest savings

DRAFT

COMMONWEAMIRTOF MASSACHUSETTS DEPARTMENT OF BUSINESS AND TECHNOLOGY MASSACHUSETTS OFFICE OF BUSINESS DEVELOPMENT
ONE ASHBURTON PLACE SUITE 2101 BOSTON, MA 02108
TELEPHONE: 617-7g8-3670 FAX: 617-788-3695 Internet: Ii_tk://www.rnass.ovirnobd t

DEVAL PATRICK
GOVERNOR

DANIEL O'CONNELL
SECRETARY OF HOUSING AND ECONOMIC DEVELOPMENT

TIMOTHY MURRAY
LIEUTENANT GOVERNOR

Commonwealth of Massachusetts Incentives, Savings, and Financing Proposal Prepared exclusively for Evergreen Solar June 15, 2007

ROBERT COUGHLIN
UNDERSECRETARY OF BUSINESS DEVELOPMENT

This proposal outlines the general terms of the incentives, savings, and financing package being offered by Massachusetts to Evergreen Solar to assist with the location construction of a new manufacturing facility at Devens, Massachusetts. This offer is subject to the successful completion of applications as noted and compliance with program requirements. The incentives related to the Economic Development Incentive Program are subject to negotiation with and approval by the Devens Enterprise Commission. Approval of Workforce Training Fund grants is subject to completion and submission of a complete application by the company and approval by the WIT Advisory Board.

II. General Information a) Contact Information: Mr. Richard Chieboski VP Worldwide Expansions Evergreen Solar Lot 42, Barnum Road, Devens Manufacturing of PV wafers, cells, and panels

b) Proposed Project Location: c) Type of Business:

DRAFT

DRAFT III. Project Overview Description To support the growth in its business, Evergreen Solar plans to build a new 280,000 s.f. manufacturing facility. Evergreen Solar plans to invest $150,000,000 for real estate, building construction, and equipment at the site. Phase one of the project will create 350 new jobs and $150 million in private investment. Evergreen envisions, but is not committed to, a second phase at the site. That phase would create an additional 300 jobs and an additional private investment of $140,000,000 million. Company Employment Plan In addition to retaining the 310 jobs currently located at their Marlborough facility, Evergreen Solar will add 350 new jobs at an average salary of $44,380.

IV. Grants Massachusetts Technology Collaborative Special Grant The Massachusetts Technology Collaborative (MTC) through its Renewable Energy Trust (RET) will provide a 510,000,000 grant to be used to offset the costs of construction and equipment for Evergreen Solar's new manufacturing facility. In return, Evergreen Solar must commit to creating 350 new incremental full-time jobs at the new Massachusetts facility (above and beyond the 310 jobs currently employed in Massachusetts) over a 24 month period from completion of construction and Evergreen Solar must commit to an investment of $150 million in the new facility for real estate, construction, and equipment. The new jobs created must be sustained over a ten year period. The grant and its terms must be approved by the MTC Board. MTC LORI Grant The Massachusetts Technology Collaborative (MTC), as administrator of the Renewable Energy Trust Fund (the Trust), is seeking applications for the Large Onsite Renewables Initiative to expand the production and use of distributed renewable energy . technologies in Massachusetts. MTC seeks to develop a diverse portfolio of renewable energy projects across a variety or locations, technologies, and building types. Round 3, has approximately $3.5 million available. Applicants will be subject to a competitive selection process. LORI applicants may request funding in two activity areas: Feasibility Study Grants and Design & Construction Grants. During open solicitation rounds LORI will accept grant. applications for development of eligible renewable energy projects(s) with greater than 10 kilowatts of nameplate capacity that are located at commercial, industrial, institutional, and public facilities that will consume more than 25% of the renewable energy generated by the project onsite. The applicant and project site(s) must be a customer of a Massachusetts investor-owned electric distribution utility. The grant awards may be used to facilitate the installation of renewable energy proiects on existing buildings (retrofits) or in conjunction with new construction/major renovation projects, including green buildings. MTC leadership has recommended that a $500,000 grant be provided to the Evergreen Solar project through the LORI program. The grant award must be approved by the MTC Board.

DRAFT

DRAFT
MORE Jobs Capital Program The MORE Jobs Capital Program was established in an economic stimulus bill that was passed by the legislature and signed into law by Governor Romney on June 24, 2006 (Chapter 123 of the Acts of 2006). The MORE Jobs Capital Program may be used to fund public infrastructure requirements of business expansion and relocation projects that will enable a private investment to occur resulting in the creation of at least 100 new jobs in Massachusetts over a 24 month period. Other program requirements are that the project must generate substantial sales from outside the Commonwealth and the company must maintain the newly created jobs for at least five years. The grant can be used for public infrastructure such as roadways, sewer, utilities, water, wastewater, etc. The grant must be applied for jointly by the company and the municipality. The application and grant award must be approved by the Secretary of Housing and Economic Development. Grant monies will be made available to the municipality as a reimbursement for the capital costs of the public infrastructure project. The Evergreen Solar project will create 350 new jobs, and MOBD will recommend a grant of up to $10,000,000 to pay for any eligible public infrastructure required by the project. Community Development Action Grant (CDAG) The Community Development Action Grant Program (CDAG), funded by the Commonwealth, provides support for publicly owned or managed projects in areas where private investment will not otherwise occur without the CDAG grant. The goal is to stimulate economic development activities that will attract and leverage private investment, create or retain long-term employment and revitalize distressed areas. Any city or town in the Commonwealth is eligible to apply to DHCD for CDAG funds. The amount of CDAG funding requested by the community must be the minimum amount necessary to make the project feasible and any benefit to private entities or individuals must be indirect and incidental and not the purpose of the project. CDAG can be used in a variety of ways, including installation, improvement, construction, repair, rehabilitation or reconstruction of buildings or other structures, facades, streets, roadways, thoroughfares, sidewalks, rail spurs, utility distribution systems, water and sewer lines, for site preparation and improvements, demolition of existing structures, and relocation assistance. A community may submit one individual application and/or one joint application for CDAG funding for the CDAG FY08 funding round. Individual CDAG awards are limited to a maximum of $1 million per project. The Evergreen Solar project is eligible to receive a CDAG grant of up to $1,000,000 for eligible public infrastructure costs. Public Works Economic Development Program (PWED) Grant The PWED Program provides grants to municipalities for the design and construction of roads and roadways and any other transportation related projects that support economic development. PWED grants are approved by the Executive Office of Transportation. Any city or town in the Commonwealth is eligible to apply to for PWED funds. There is a grant cap of $1,000,000 per project per municipality. The Evergreen Solar project is eligible to receive a PWED grant of up to $1,000,000 for eligible public roadway construction/upgrade costs. Workforce Training Fund (WTF) The Massachusetts Business Resource Team will assist Evergreen Solar in applying for workforce training grants via the Massachusetts Workforce Training Fund (WTF). The WTF provides grants to train new employees or to upgrade the skills of existing employees. The WTF has no income requirements and is especially applicable to Evergreen Solar's more technically skilled workers. Companies applying to the program for the first time receive preference. Companies can receive

DRAFT

DRAFT multiple grants. This flexible program requires a company match that can be met by "in-kind" expenses incurred in providing the training. Typically, applicants meet the match through the salaries of employees as they provide or receive the training that is funded by the grant. The grant cap on the WTF is $1 million per company per year. Historically, grants have usually averaged out to approximately $1,100 per employee. However, for more technology driven industries like life sciences, grants have averaged closer to $1,600 per employee. Based on the number of 310 current employees and projections to add 350 new employees and given the highly technical skill requirements for training, Evergreen Solar could very possibly qualify for a Workforce Training Fund Grant of up to $1,000,000 (660 employees x $1,600/employee). These grant monies would be set up in an account and could be used over a two-year period. A grant from the Workforce Training Fund requires approval of the Workforce Advisory Board. The Commonwealth Corporation will provide free application assistance to save you time and money and to help ensure that the final application has a higher likelihood of approval. The Hiring Incentive Training (HIT) Grant The HIT Grant Program is open to all employers. It provides training grants of up to $2,000 per employee and up to $30,000 a year per company. This program assists in paying training costs for newly hired employees who have been unemployed over a year and those that do not have a call back date from their last employer. Assuming that 10% of the new hires meet the HIT criteria, the potential value of the HIT grant to Evergreen Solar could be as high as $30,000 {350 new hires x 10% x $2,000). Workforce Assistance Upon site identification, the Department of Workforce Development can facilitate curriculum development or program design at the nearby community college or technical school to ensure access to the training your workforce needs. Once you are ready to hire, DWD's Division of Career Service can assist with providing targeted recruitment and prospective employee screening at one of our 32 One Stop Career Centers across the Commonwealth. DWD is ready to be an active partner in the education and training of your workforce in Massachusetts.

V. Tax Increment Financing Economic Development Incentive Program (EDIP) Through the EDIP, designated Economic Target Area (ETA) communities, in partnership with the Commonwealth, can provide 1) real estate property tax exemptions, 2) personal property tax exemptions, and 3) investment tax credits to businesses locating to or expanding in the community. The EDIP is a three-way partnership between the state, the municipality and the participating job creating business. EDIP How it Works The municipality makes available local Tax Increment Financing (TIF) - a negotiated real estate tax exemption based on a percentage of the value added through renovation or new construction. The duration of the TIF is for a period of no less than five years and no more than twenty years. The terms of the TIF are negotiated between the property owner seeking the benefits of the EDIP and the municipality. The state does not participate in that

DRAFT

DRAFT negotiation. In addition to the negotiated TIF real estate property tax exemption, the business would automatically receive a 100% personal property tax exemption on the site for the life of the project.
To qualify for the EDIP incentives a participating business must become a "Certified Project". As part of the Certified Project, the business must agree to create at least one permanent full-time, net new Massachusetts job. As part of the Certified Project, the business also agrees to a specific level of private investment and job retention where applicable. Upon municipal approval, and then the approval of the Economic Assistance Coordinating Council (EACC), the state makes available a 5% investment tax credit known as the 5% Economic Opportunity Area Credit.

Illustrative Example of EDIP and Hypothetical Savings

Real Estate Property Tax Exemption Savings The terms of the TIF agreement are to be determined through negotiation between Devens and Evergreen Solar. For illustration purposes only (to demonstrate how the TIF works), we have assumed the new building of 280,000 s.f will result in an incremental value of $40,000,000, starting in year 3. We assumed that this value will increase by 1% annually. We used Devens' current commercial real estate tax rate of $17.10/$1,000 AV. Therefore, there will be an initial incremental annual real estate tax liability of $342,000. This liability will grow 1% annually. If we assume that the negotiated TIF is for 20-years and provides an annual exemption of 5%, then the total savings from the real estate property tax exemption (TIF) over the 20-year life of the project will be $705,195 (see attached Exhibit 1 TIF Spreadsheet). Please note that this illustration is not a proposal from any municipality and that the actual terms of a TIF, including the length of the TIF period, must be negotiated between Evergreen Solar and Devens. Personal Property Tax Savings As a Certified Project with a TIF agreement, Evergreen Solar will automatically qualify for a 100% exemption on personal property taxes over the 20 year life of the project at this site. Beyond the 20-year project period, as a manufacturing corporation in Massachusetts, Evergreen Solar will qualify for a 100% exemption on personal property taxes on all manufacturing equipment. Based on the numbers provided by Evergreen Solar, there will be $87,0000,000 in tangible depreciable assets (equipment) at the new facility. We assumed that these would be depreciated on a straight-line basis over 10 years. We then assumed that an additional $2 million of equipment would be purchased annually and also depreciated over a ten year period. We assumed the personal property tax rate to be $15.00/$1.000 in value. Over the 20-year life of theproject, the total Personal Property Tax exemption savings is estimated to be $10,770,910 (see attached Exhibit 2 Personal Property Tax Exemption Spreadsheet). Investment Tax Credit Successful completion of the EDIP process, as outlined above, will facilitate the extension of an EOA Investment Tax Credit (EOA-ITC) of 5% to Evergreen Solar as a "Certified. Project". The BOA-ITC can be utilized by the certified project business during the entire term of the TIF agreement between the property owner and the municipality (in this example 20 years).

Based on the $150,000,000 investment in real estate, equipment, and facilities provided to us by Evergreen Solar and assuming all of these qualify for the investment tax credit, the total 5% DRAFT 7

DRAFT Investment Tax Credit will be $7,500,000. This amount can be applied directly against any Massachusetts tax obligation (though use of the EOA-ITC cannot in any single year reduce Massachusetts tax liability by greater than 50%). Unused credits may be carried forward to subsequent years over the 20-year life of the project (through 2027). Our assumption is that Evergreen Solar will be in a position to fully utilize the available credits during the 20-year project life.

VI. Tax Incentives Sales and Use Tax Credit Massachusetts exempts all manufacturing equipment and all R&D equipment from sales and use taxes. Therefore, regardless of where Evergreen Solar purchases this equipment, Evergreen Solar will not pay the 5% MA sales tax nor the 5% MA use tax. Based on the same assumptions for machinery and equipment purchases that we made for the PPT exemption (see Exhibit 2), we estimate the total machinery and equipment purchases over the 20-year project life to be $200 million. We assumed that all of this machinery and equipment is for the purposes of R&D and/or manufacturing. Based on these assumptions, over the 20-year project period, the sales and use tax exemption savings could be as high as $10,000,000 ($200,000,000 x .05). Single Sales Factor Tax Apportionment A potentially significant cost advantage in Massachusetts to manufacturers like Evergreen Solar is the "single sales factor" tax apportionment. For manufacturing corporations with multi-state tax filings, the single sales factor apportions state corporate income tax based solely on a ratio of instate sales to total sales. Other states typically use more complicated apportionment formulas, which include not only the in-state sales ratio but also include the ratio of in-state payroll to total payroll and the ratio of in-state property to total property. The practical implication is that these states penalize companies that hold and add tangible assets and jobs in that state. For instance, California, New Jersey, and New Mexico all use multiple factor apportionment, which penalizes manufacturers for owning property and paying wages in-state. As manufacturers like Evergreen Solar expand their facilities and create new jobs in these states, the effective tax rate and the resultant tax burden for the company will likely increase. In Massachusetts, we welcome investments in people and property. In Massachusetts, such investments will have no negative impact on Evergreen Solar's corporate tax rate and tax burden. The long term tax savings from the single sales factor apportionment can often be very substantial and it is not unusual that the value of these savings can be more than the value of the rest of the incentives combined. Research and Development Tax Credit Massachusetts has the most favorable R&D tax incentive in the nation. In Massachusetts, any costs which would qualify for the Federal R&D tax credit are eligible for a 10% Massachusetts R&D Tax Credit. This credit can be used in addition to the Investment Tax Credit and can reduce tax liability to the minimum of $456 annually. In addition, a 15% R&D Tax Credit is available for costs related to donations and contributions made to research organizations such as hospitals and universities. The R&D credit cannot reduce a corporation's tax liability below the minimum $456 and cannot reduce any tax liability over $25,000 by more than 75%. However, a corporation may carry forward for an unlimited period of time any portion of the R&D credit which cannot be allowed in a particular tax year because of this limit. DRAFT 8

DRAFT VII. Financing A total financing package of $17,500,000 for the private investment in building and equipment will be supplied by three sources MassDevelopment, Renewable Energy Trust (MTC), and Citizens Bank. The Renewable Energy Trust will purchase a participation in a single note offered by MassDevelopment, which will service the loan, including any staffing for work out negotiations. Awards are contingent upon approval by the respective Boards of MassDevelopment and Massachusetts Technology Collaborative and successful underwriting by Citizen's Bank. Mass Development Emerging Technology Fund Loan Amount: $5,000,000, all available to support phase 1. Limited to 25% of total project cost. All advances on equipment limited to 85% of invoice cost, at time of receipt of equipment in the facility in which it will be installed. 6% I% 7 years (first 18 months interest only) with the outstanding principal to be amortized over the remaining 66 months First position lien on the assets financed (at 85% advance rates) and a junior lien on all other business assets. This junior lien is (1) junior only to the $25 million line of credit with Silicon Valley Bank that is due to be put in place, (2) pari passu with the $7.5 million loan by Citizens Bank of Massachusetts for certain equipment not financed by the MassDevelopment/MTC loans, and (3) pari passu with junior lien of MTC. MassDevelopment and MTC will share in a warrant package, with number of shares/warrants based on one year's worth of interest on the original loan amount, divided by the average price of the stock over the last 20 trading day closing price preceding the financing. The average price when determined will be divided into the interest due during the first year to determine how many shares of common stock the warrant package will provide and produce the exercise price of the warrants. The average closing price will be the warrant exercise price. Additional terms to be addressed through a separate term sheet, subject to negotiation. Must receive formal approval by the MassDevelopment Board.

Interest rate: Commitment Fee: Term:

Collateral:

Success Fee:

Other:

Approval:

DRAFT

DRAFT Renewable Energy Trust (MTC)

Loan Amount: $5,000,000, all available to support phase 1. All advances on equipment limited to 85% of invoice cost, at time of receipt of equipment in the facility in which it will be installed. 6% 1% 7 years (first 18 months interest only) with the outstanding principal to be amortized over the remaining 66 months First position lien on the assets financed (at 85% advance rates) and a junior lien on all other business assets. This lien is (1) junior only to the $25 million line of credit with Silicon Valley Bank that is due to be put in place, (2) pari passe with$7.5 million loan by Citizens Bank of Massachusetts for certain equipment not financed by the MassDevelopment/MTC loans, and (3) pari passe with junior lien of MDFA. Same as MassDevelopment: MassDevelopment and MTC will share in a warrant package, with number of shares/warrants based on one year's worth of interest on the original loan amount, divided by the average price of the stock over the last 20 trading day closing price preceding the financing. The average price when determined will be divided into the interest due during the first year to determine how many shares of common stock the warrant package will provide and produce the exercise price of the warrants. The average closing price will be the warrant exercise price. Additional terms to be addressed through a separate term sheet, subject to negotiation. Must receive formal approval by the Massachusetts Technology Collaborative Board

Interest rate: Commitment Fee: Term:

Collateral:

Success Fee:

Other:

Approval:

Citizens Job Bank Program Economic Development Loan

Citizens Bank offers the following terms, contingent on additional negotiations and underwriting terms, summarized below: Amount: $7,500,000, 5 year fully amortizing term loan all available to support phase 1. (Provided Evergreen certifies that the amount is less than $40,000 per new job created within 36 months of the completion of the project and provided that the loan amount does not exceed 75% of assets financed) 4.99% on first $5,000,000, and 5.99% on next $2,500,000 for a blended rate of 5.32%

Rates:

DRAFT

10

Collateral:

DRAFT First priority lien on specific assets financed and second priority lien on all business assets behind Silicon Valley Batik, pad passu with MassDevelopment and the Massachusetts Technology Collaborative.

Other:

Additional terms to be addressed separately with Citizens Bank, subject to negotiation. Approval of this Economic Development Loan by Citizens is subject to Citizens' normal underwriting guidelines and loan approval requirements and execution of documentation satisfactory to the bank and its legal counsel.

Underwriting:

VIII.

Other Savings

Land Cost Savings Devens Site Evergreen Solar proposes to locate its Phase 1 (and possibly Phase 2) project on a publicly owned, 20-acre parcel at Devens. If the project is constructed at this site, Evergreen Solar could realize up to 52,400,000 in savings by avoiding land acquisition costs. MTC would retain public ownership of the land and lease the land to Evergreen Solar at a nominal rate for up to 30 years.

IX. Massachusetts Its All Here Leading Renewable Energy Cluster o Governor Patrick's commitment to bold initiatives to build the renewable energy sector o Energy efficiency and renewable energy sectors employ 10,000 in Massachusetts o Massachusettts has world leading cluster of renewable energy companies o Massachusetts has 60 renewable energy companies employing more than 3,000 o Massachusetts Technology Collaborative (Renewable Energy Trust) o Well established supply chain right here in Massachusetts o Next generation renewable energy research being done by nine universities in MA World Class Workforce o Highest concentration of bachelors and masters degrees in the country o Highest concentration of science and engineering degrees in the country o Ranked 2nd nationally in worker productivity o Large, highly skilled, experienced workforce in energy and technology sectors #1 Education System in the Country Postsecondary and Public Schools (K-12) o Three of the top fifteen research universities (measured by technology licensing revenues) in the country (University of Massachusetts, Harvard, MIT) o Highest concentration of college students in the country Public Schools o # 1 nationally in SAT assessment test scores in math and #2 in verbal o # 1 nationally in NEA assessment test scores in both math and reading II

DRAFT

DRAFT I-495/Central Massachusetts corridor strikes a balance between access to a highly skilled workforce, affordability, and access to major highways, airports, and rail transportation o Located in the heart of the technology sector workforce in MA o Located only 10 minutes from the Marlborough facility and next door to MTC o Near the intersection of 1-495, Mass Pike and Rte. 2 o Within 60 miles of nearly every major postsecondary institution in Massachusetts. o Within 45 minutes of Logan International Airport o Direct commuter rail direct service to Boston and Worcester o Cost of Living Index of Central Massachusetts is 50%-70% lower than Boston Excellent Quality of Life to Attract and Retain Professional and Technical Personnel o Proximity to great public schools o Very low violent crime rate o Within 35 miles of five of top hospitals in the country (Mass General, Brigham and Women's, Dana Farber, Beth Israel Deaconess, and Children's Hospital) o 45 minutes to the history of Boston or the seashore, 2 hours to world-class skiing o Home of the world renowned Boston Symphony and Boston Pops o Home of the World Champion New England Patriots and Boston Red Sox

NEW ECONOMY INDEX 1 (1=HIGHEST, 50=LOWEST) Other States V. Massachusetts NM NY OR MA 27 10 Overall State Ranking 11 1 Knowledge Jobs 25 11 3 7 37 21 3 Economic Dynamism 17 Digital Economy 14 6 1 41 Innovation Capacity 7 14 1 18 15 18 12 High Tech Jobs 1
I

Source: Progressive Policy Institute

Milken Science and Technology Index2 2002 1 7 20 23 2004 1 7 14 19 Rank Change 0 0 6 4 Score 84.35 69.03 61.75 57.76

Massachusetts New York New Mexico Oregon

Footnotes:

2The 2004 State Technology and Science Index encapsulates each state's comprehensive inventory of technology and science assets that can be leveraged to promote economic development.

The Index provides states with a benchmark, monitors their technology progress and can be leveraged to promote economic growth. It provides a valuable framework of measures to guide state policy makers and the public on the realities of their performance in the knowledge-based economy of today. "Places that can attract, grow and retain firms and industries proficient at deploying information technology, in addition to producing it, will be at a competitive

DRAFT

12

From: Jones, Kofi (EED) [mailto:KoflionesstateAa.uS] Sent: Wednesday, April i,8, 2007 3:27 PM To: Perez, Enrique (DBT) Subject money breakdown

c oAc,..T-ED
Here's what we said as far as the-44 million dollar package of grants and loans....

The Massachusetts Office of Business Development (MOBD) and its Business Resource Team partners, put together a pacicage of grants, tax incentives, and other financial tools ". in support Of.a Evergreen Solar's $150 million private investment. The $44 million package of grants. and loans includes: o $23 million in grants to Evergreen Solarand the town of Westborough: . .. o $10.5 Million in grants from the Mass. Technology Collaborative's . Renewable Energy Trust . o Opportunity to apply in conjunction with the town of Westborougkfor a $10 million MORE Jobs "Grant the. newly announced $100 million:. . program of grants to help municipalities upgrade public infrastructure and . support buSiness development through job growth ' o Workforce Training Fund andother infrastructure grants totaling $3 million . .0 $17.5 million of loans from MassDevelopment, MTC, and Citizens. Bank $3 million in land savings from low-cost lease of state-owned land
KOFI JONES . Director of. Communications 'Executive Office of HOusing and Economic Development 617-788-652 . cell: 611-721-223x lcofijoneSpstate.ma.us