Exhibit 10.3

TAX SHARING AGREEMENT

BY

CABOT CORPORATION

AND

CABOT MICROELECTRONICS CORPORATION

TABLE OF CONTENTS

                                                                   PAGE
SECTION 1.  Definition of Terms                                       2

SECTION 2.  Allocation of Income Tax Liabilities                      7

SECTION 3.  Preparation and Filing of Tax Returns                    11

SECTION 4.  Refunds, Carrybacks and Tax Benefits                     15

SECTION 5.  Tax Payments and Intercompany Billings                   19

SECTION 6.  Assistance and Cooperation                               25

SECTION 7.  Tax Records.                                             26

SECTION 8.  Tax Contests                                             27

SECTION 9.  No Inconsistent Actions                                  28

SECTION 10. Survival of Obligations                                  30

SECTION 11. Employee Matters                                         30

SECTION 12. Treatment of Payments; Tax Gross Up                      30

SECTION 13. Disagreements                                            31

SECTION 14. Late Payments                                            32

SECTION 15. Expenses                                                 32

SECTION 16. General                                                  32

TAX SHARING AGREEMENT

This Agreement is entered into as of March 28, 2000 by Cabot Corporation, a Delaware corporation ("Cabot"), and Cabot Microelectronics Corporation, a Delaware corporation ("CMC"). Capitalized terms used in this Agreement are defined herein. Unless otherwise indicated, all "Section" references in this Agreement are to sections of this Agreement.

RECITALS

WHEREAS, the board of directors of Cabot has determined that it would be in the best interests of Cabot and its stockholders to completely separate the MMD Business from Cabot;

WHEREAS, Cabot has caused CMC to be incorporated in order to effect such separation;

WHEREAS, Cabot and CMC have entered into the Master Separation Agreement and the Ancillary Agreements (other than this Agreement), pursuant to which Cabot has contributed and transferred to CMC, and CMC has received and assumed, the assets and liabilities then associated with the MMD Business as described therein;

WHEREAS, Cabot and CMC intend that the contribution of the assets and liabilities associated with the MMD Business in exchange for CMC qualify as tax-free under Section 351 or 368(a)(1)(D) of the Code;

WHEREAS, Cabot currently owns all of the issued and outstanding CMC common stock;

WHEREAS, Cabot and CMC currently contemplate that CMC will make an initial public offering of an amount of its common stock that will reduce Cabot's ownership of CMC to not less than 80%;

WHEREAS, Cabot currently contemplates that, following such initial public offering, Cabot will distribute to the holders of its common stock by means of a pro rata distribution all of the shares of CMC common stock owned by Cabot;

WHEREAS, Cabot and CMC intend that the Distribution will be tax-free to Cabot and its stockholders under Section 355 of the Code;

WHEREAS, as a result of the Distribution, CMC will cease to be a member of the affiliated group of which Cabot is the common parent, effective as of the Distribution Date; and

WHEREAS, the Companies desire to provide for and agree upon the allocation between the parties of liabilities for Taxes arising prior to, as a result of, and subsequent to the Distribution, and to provide for and agree upon other matters relating to Taxes;

NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereby agree as follows:

SECTION 1. Definition of Terms. For purposes of this Agreement (including the recitals hereof), the following terms have the following meanings:

"ACCOUNTING CUTOFF DATE" means, with respect to CMC, any date as of the end of which there is a closing of its financial accounting records.

"ACCOUNTING FIRM" shall have the meaning provided in Section 13.

"ADJUSTMENT REQUEST" means any formal or informal claim or request filed with any Tax Authority, or with any administrative agency or court, for the adjustment, refund, or credit of Taxes, including (a) any amended Tax Return claiming adjustment to the Taxes as reported on the Tax Return, or if applicable, as previously adjusted, or (b) any claim for refund or credit of Taxes previously paid.

"AFFILIATE" means any entity that directly or indirectly is "controlled" by the person or entity in question. "Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by contract or otherwise. Except as otherwise provided herein, the term Affiliate shall refer to Affiliates of a person as determined immediately after the Distribution.

"AGREEMENT" means this Tax Sharing Agreement.

"ANCILLARY AGREEMENTS" has the meaning set forth in the Master Separation Agreement.

"CABOT FEDERAL CONSOLIDATED RETURN" means any United States federal Consolidated Income Tax Return for the affiliated group (as that term is defined in Code Section 1504) that includes Cabot as the common parent and that includes, during the Consolidated Periods, the CMC Group.

"CABOT GROUP" means all corporations included in the Cabot Federal Consolidated Return.

"CARRYBACK" or "CARRYFORWARD" means any net operating loss, net capital loss, excess tax credit, foreign tax credit or other similar Tax Item which may or must be carried from one Tax Period to another Tax Period under the Code or other applicable Tax Law.

"CMC GROUP" means CMC and all corporations included in the CMC Federal Consolidated Return, or, during any Consolidation Period, that would be included in such Return if CMC were not included in the Cabot Federal Consolidated Return.

"CMC FEDERAL CONSOLIDATED RETURN" means any United States federal Tax Return or Returns in respect of periods after the Consolidation Period filed by CMC alone or by the affiliated group (as that term is defined in Code Section 1504) that includes CMC as the common parent.

"CODE" means the U.S. Internal Revenue Code of 1986, as amended from time to time, or any successor law.

"COMPANY" means Cabot or CMC.

"CONSOLIDATED INCOME TAX RETURN" OR "COMBINED INCOME TAX RETURN" means any Tax Return relating to Income Tax which is computed by reference to the assets and activities of members of the Cabot Group (other than members of the CMC Group) and the CMC Group.

"CONSOLIDATED PERIOD" or "CONSOLIDATED PERIODS" means any taxable period or periods between the Contribution Date and the Distribution Date, during which time CMC is a member of the Cabot Group.

"CONTRIBUTION DATE" has the meaning set forth in the Master Separation Agreement.

"DISTRIBUTION" means the distribution to Cabot shareholders of all, or substantially all, of the CMC common shares held by Cabot or any earlier event as a result of which CMC ceases to be a member of the Cabot Group.

"DISTRIBUTION DATE" means the date of the Distribution, as determined by Cabot in its sole and absolute discretion.

"FEDERAL INCOME TAX" means any Income Tax imposed by the United States government.

"FOREIGN INCOME TAX" means any Income Tax imposed by any foreign country or any possession of the United States, or by any political subdivision of any foreign country or United States possession.

"GROUP" means the Cabot Group or the CMC Group, as the context requires.

"INCOME TAX" means all Taxes (i) based upon, measured by, or calculated with respect to, net income or net receipts, proceeds or profits or (ii) based upon, measured by, or calculated with respect to multiple bases (including, but not limited to, corporate franchise and occupation Taxes) if such Tax may be based upon, measured by, or calculated with respect to one or more bases described in clause (i) above.

"INITIAL PUBLIC OFFERING" has the meaning set forth in the IPO and Distribution Agreement.

"INTERNAL REVENUE SERVICE" OR "IRS" means the United States Internal Revenue Service or the United States Department of the Treasury, as the context requires.

"IPO AND DISTRIBUTION AGREEMENT" has the meaning set forth in the Master Separation Agreement.

"IRS PRIVATE LETTER RULING" means the private letter ruling issued by the IRS in response to the letter filed by Cabot requesting a ruling from the Internal Revenue Service regarding certain tax consequences of the Transactions.

"MASTER SEPARATION AGREEMENT" means the Master Separation Agreement between Cabot and CMC, dated March 28, 2000.

"MMD BUSINESS" has the meaning set forth in the Master Separation Agreement.

"OTHER TAX" means any Tax that is not an Income Tax.

"PAYMENT DATE" means (i) with respect to any Cabot Federal Consolidated Return, the due date for any required installment of estimated taxes determined under Code Section 6655, the due date (determined without regard to extensions) for filing the return determined under Code Section 6072, and the date the return is filed, and (ii) with respect to any Consolidated or Combined State Income Tax Return, the corresponding dates determined under the applicable Tax Law.

"POST-DISTRIBUTION PERIOD" means any Tax Period beginning after the Distribution Date, and, in the case of any Straddle Period, the portion of such Straddle Period beginning the day after the Distribution Date.

"PRE-DISTRIBUTION PERIOD" means any Tax Period ending on or before the Distribution Date, and, in the case of any Straddle Period, the portion of such Straddle Period ending on the Distribution Date.

"PRIME RATE" means the base rate on corporate loans charged by Citibank, N.A., New York, New York from time to time, compounded on each March 31, June 30, September 30 and December 31.

"RESPONSIBLE COMPANY" means, with respect to any Tax Return, the Company having responsibility for preparing and filing such Tax Return under this Agreement.

"RESTRUCTURING TAX" means the Taxes described in Sections 2.4(a).

"SEPARATE COMPANY TAX" means any Tax computed by reference to the assets and activities of a member or members of a single Group.

"STRADDLE PERIOD" means any Tax Period that begins on or before and ends after the Distribution Date.

"STATE INCOME TAX" means any Income Tax imposed by any State of the United States or by any political subdivision of any such State.

"TAINTING ACT" shall have the meaning provided in Section 9.

"TAX" or "TAXES" means any income, gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social security, workers compensation, unemployment, disability, property, ad valorem, stamp, excise, severance, occupation, service, sales, use, license, lease, transfer, import, export, value added, alternative minimum, estimated or other similar tax (including any fee, assessment, or other charge in the nature of or in lieu of any tax) imposed by any governmental entity or political subdivision thereof, and any interest, penalties, additions to tax, or additional amounts in respect of the foregoing.

"TAX AUTHORITY" means, with respect to any Tax, the governmental entity or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such entity or subdivision.

"TAX BENEFIT" means any refund of, credit against, or other reduction in otherwise required Tax payments (including any reduction in estimated tax payments) and any interest in respect of the foregoing, net of the effect on otherwise required Tax payment of any associated or corresponding item of income or gain, or other increase in otherwise required Tax payments.

"TAX CONTEST" means an audit, review, examination, or any other administrative or judicial proceeding with the purpose or effect of redetermining Taxes of any of the Companies or their Affiliates (including any administrative or judicial review of any claim for refund).

"TAX ITEM" means, with respect to any Income Tax, any item of income, gain, loss, deduction, or credit.

"TAX LAW" means the law of any governmental entity or political subdivision thereof relating to any Tax.

"TAX PERIOD" means, with respect to any Tax, the period for which the Tax is reported as provided under the Code or other applicable Tax Law.

"TAX RECORDS" means Tax Returns, Tax Return workpapers, documentation relating to any Tax Contests, and any other books of account or records required to be maintained under the Code or other applicable Tax Laws or under any record retention agreement with any Tax Authority.

"TAX RETURN" means any report of Taxes due, any claims for refund of Taxes paid, any information return with respect to Taxes, or any other similar report, statement, declaration, or document required to be filed under the Code or other Tax Law, including any attachments, exhibits, or other materials submitted with any of the foregoing, and including any amendments or supplements to any of the foregoing.

"TRANSACTIONS" means the transactions contemplated by the Master Separation Agreement and the IPO and Distribution Agreement.

"TREASURY REGULATIONS" means the regulations promulgated from time to time under the Code as in effect for the relevant Tax Period.

SECTION 2. Allocation of Income Tax Liabilities.

2.1. Federal Income Tax. Except as otherwise provided in this Agreement, Federal Income Tax liability shall be allocated as follows:

(a) Consolidated Period. For each Consolidated Period, CMC shall be liable for and pay to Cabot an amount equal to Federal Income Tax determined under the "Stand Alone Method." Under this method CMC's liability for Tax for any taxable period is computed as if, since its formation, CMC had (i) never been part of the Cabot Group and (ii) filed a consolidated Federal Income Tax Return as parent of the CMC Group with each eligible member of that Group; provided, however, that the provisions of Section 2.5(a) regarding special rules for application of the Stand Alone Method shall apply. Cabot shall be liable for all Federal Income Tax for the Consolidated Period other than amounts for which CMC is liable pursuant to this Section 2.1(a).

(b) Non-Consolidated Periods. CMC shall be responsible for all Federal Income Tax imposed on members of the CMC Group with respect to all periods which are not Consolidated Periods. Cabot shall be responsible for all Federal Income Tax imposed on members of the Cabot Group other than members of the CMC Group with respect to all periods which are not Consolidated Periods.

2.2. State and Foreign Income Taxes. Except as otherwise provided in this Agreement, State and Foreign Income Tax liability shall be allocated as follows:

(a) Consolidated or Combined State and Foreign Income Taxes. CMC shall be liable for and pay to Cabot any State or Foreign Income Tax with respect to any Consolidated or Combined State or Foreign Income Tax Return in an amount that is equal to the amount determined under the Stand Alone Method for the period covered by such Tax Return. Cabot shall be liable for and pay any State or Foreign Income Tax with respect to any Consolidated or Combined State or Foreign Income Tax Return other than the amount for which CMC is liable pursuant to this Section 2.2(a).

b) Separate Company Taxes. In the case of any State or Foreign Income Tax which is a Separate Company Tax, CMC shall be liable for and shall pay directly the applicable Tax

Authority any such Income Tax that is properly imposed under Tax Law on any member of the CMC Group and Cabot shall be liable for and shall pay any such Separate Company Tax imposed on any member of the Cabot Group other than a member of the CMC Group.

2.3 Other Taxes. Except as otherwise provided in this Agreement, CMC shall be liable to and pay the applicable Tax Authority any Other Tax that is imposed on any member of the CMC Group and Cabot shall be liable to and pay the applicable Tax Authority any Other Tax that is imposed on any member of the Cabot Group other than a member of the CMC Group.

2.4. Transaction Taxes.

(a) General. Except as otherwise provided in this Section 2.4 Cabot shall be responsible for and pay any and all liability for Taxes resulting from the Transactions. This shall include but not be limited to (i) any sales and use, gross receipts, or other transfer Taxes imposed on the transfers occurring pursuant to the Transactions together with any Tax resulting from any income or gain recognized under Treasury Regulation Sections 1.1502-13 or 1.1502-19 (or any corresponding provisions of other applicable Tax Laws) as a result of the Transactions; and (ii) except as otherwise provided in Section 2.4(b), any Tax resulting from any income or gain recognized as a result of any of the Transactions failing to qualify for tax-free treatment under Code Sections 351, 355, 361, or other provisions of the Code (as contemplated in the IRS Private Letter Ruling) or corresponding provisions of other applicable Tax Laws.

(b) Inconsistent Acts and Events. Cabot or CMC, as the case may be, shall be liable for, and shall indemnify and hold harmless the members of the other Group from and against any liability for, any Restructuring Tax (described in subparagraphs (i) and (ii) above) to the extent arising from (i) any breach by such indemnifying party of the representations or covenants under Section 9, (ii) any Tainting Act performed by such indemnifying party, (iii) the inaccuracy of any factual statements or representations made by such indemnifying party in connection with the IRS Private Letter Ruling, but only to the extent such inaccuracy

arises from facts in existence prior to the Distribution Date or (iv) any
Section 355(e) Event with respect to the indemnifying party. A Section 355(e) Event with respect to an entity occurs if one or more persons acquire directly or indirectly stock of such entity representing a 50% or greater interest in such entity within the meaning of Section 355(e).

2.5. Calculation of Tax Liability.

(a) Stand Alone Method. The following rules shall apply for purposes of computing CMC's liability under the Stand Alone Method - (i) transactions during any Consolidated Period between a member of the CMC Group and a member of the Cabot Group that is not a member of the CMC Group shall, for Federal Income Tax purposes, be accounted for pursuant to the provisions of the regulations under IRC Section 1502 that govern intercompany transactions (and to the extent appropriate for State or Foreign Income Tax purposes, similar rules shall apply in the case of transactions between such members which are included in State or Foreign Combined or Consolidated Income Tax Returns), provided that the pricing of the provision of goods and services in intercompany transactions shall be in accordance with the economic terms of any written arrangements among the parties (i.e. liability under the Stand Alone Method shall be computed without regard to any adjustments to such pricing that may be made under Section 482 of the Code or analogous provisions of State or Foreign law); (ii) during Consolidated Periods all computations shall be made in conformity with the positions, elections and accounting methods used by Cabot in preparing the consolidated returns of the Cabot Group; (iii) the highest marginal tax rate to which the CMC Group could be subject under applicable Tax Law shall be deemed to be the only Tax rate to which such group is subject under such law; and (iv) subject to (i) through (iii) above, all computations and other determinations shall be made in accordance with the the laws and regulations applying to affiliated groups filing consolidated returns (including, in the case of any company that becomes or ceases to be a member of any Group, the laws

and regulations applicable to a company that becomes or ceases to be a member of a such Group), as well as all other relevant federal Tax laws and regulations (and similar rules shall apply in the case of State or Foreign Taxes in respect to Combined or Consolidated Returns for such Taxes).

(b) The principles of Treasury Regulation Section 1.1502-76(b) as reasonably interpreted and applied by the Companies shall apply in determining whether a Tax Item is attributable to a Tax Period provided that
(x) no election shall be made under Treasury Regulation Section 1.1502-76(b)(2)(ii) (relating to ratable allocation of a year's items) and
(y) if the Distribution Date is not an Accounting Cutoff Date, the provisions of Treasury Regulation Section 1.1502-76(b)(2)(iii) will be applied to ratably allocate the items (other than extraordinary items) for the month which includes the Distribution Date.

(c) In determining the apportionment of Tax Items between Pre-Distribution Periods and Post-Distribution Periods, any Tax Items relating to the Transactions shall be treated as an extraordinary item described in Treasury Regulation Section 1.1502-76(b)(2)(ii)(C) and shall be allocated to Pre-Distribution Periods, and any Taxes related to such items shall be treated under Treasury Regulation Section 1.1502-76(b)(2)(iv) as relating to such extraordinary item and shall be allocated to Pre-Distribution Periods.

2.6. Tax Payments and Intercompany Billings. Each Company shall pay the Taxes allocated to it by this Section 2 either to the applicable Taxing Authority or to the other Company in accordance with Section 5.

SECTION 3. Preparation and Filing of Tax Returns.

3.1. General. Except as otherwise provided in this Section 3, Income Tax Returns shall be prepared and filed when due (including extensions) by the person obligated to file such Tax Returns under the Code or applicable Tax Law. The Companies shall provide, and shall cause their Affiliates to provide, assistance and cooperate with one another in accordance with Section

6 with respect to the preparation and filing of Tax Returns, including providing information required to be provided in Section 6.

3.2. Pre-Distribution Period and Straddle Period Tax Returns. All Income Tax Returns required to be filed for Pre-Distribution Periods or Straddle Periods, shall be:

(1) prepared and filed by Cabot, in the case of any Consolidated or Combined Income Tax Return; and

(2) prepared and filed, or caused to be prepared and filed, by the Company to which such Tax Return relates in all other cases.

CMC shall, for each Tax Period or portion thereof for which CMC or a member of the CMC Group is included in a Tax Return described in clause (1) of the preceding sentence, provide Cabot with (i) a true and correct pro forma tax return for the CMC Group together with an accompanying computation of Tax liability of the Group prepared in accordance with the Stand Alone Method, (ii) separate pro forma tax returns for each member of the CMC Group together with accompanying computations of the separate tax return Tax liabilities of each member of the Group, and (iii) a reconciliation of book income to federal taxable income for each member of the CMC Group. CMC hereby agrees to use its best efforts to provide Cabot with such returns and computations no later than the first day of the sixth month following the end of the period to which such returns and computations relate, but in any event shall provide such returns and computations to Cabot no later than the fifteenth day of the sixth month following the end of the period to which such returns and computations relate. CMC, in preparing the above mentioned pro forma tax returns for its Group, shall not consider or give effect to any (i) net operating loss carryover or carryback, (ii) capital loss carryover or carryback, (iii) excess charitable deduction carryover, (iv) excess tax carryover or carryback, or (v) other similar carryback or carryback item.

3.3. Post-Distribution Period Tax Returns. Except as otherwise provided in
Section 3.2 with respect to Straddle Period Tax Returns:

(1) All Tax Returns related to CMC or the CMC Group for Post-Distribution Periods shall be prepared and filed (or caused to be prepared and filed) by CMC,

(2) All Tax Returns related to Cabot or the Cabot Group, excluding for this purpose CMC or members of the CMC Group, for Post-Distribution Periods shall be prepared and filed (or caused to be prepared and filed) by Cabot.

3.4. Tax Accounting Practices.

(a) General Rule. Except as otherwise provided in this Section 3.4, any Income Tax Return for any Pre-Distribution Period or any Straddle Period, and any Income Tax Return for any Post-Distribution Period to the extent items reported on such Tax Return might reasonably affect items reported on any Tax Return for any Pre-Distribution Period or any Straddle Period, shall be prepared in accordance with past Tax accounting practices used with respect to the Tax Returns in question (unless such past practices are no longer permissible under the Code or other applicable Tax Law), and to the extent any items are not covered by past practices (or in the event such past practices are not longer permissible under the Code or other applicable Tax Law), in accordance with reasonable Tax accounting practice selected by the Responsible Company.

(b) Reporting of Transaction Tax Items. The tax treatment reported on any Tax Return of Tax Items relating to the Transaction shall be consistent with the treatment of such item in the IRS Private Letter Ruling. To the extent there is a Tax Item relating to the Transactions which is not covered by the IRS Private Letter Ruling, the tax treatment of such Tax Items on a Tax Return shall be determined by the Responsible Company with respect to such Tax Return, provided (i) there is a reasonable basis for such tax treatment, and (ii) such tax treatment is not inconsistent with the tax treatment contemplated in the IRS Private Letter

Ruling. Such Tax Return shall be submitted for review pursuant to Section 3.5(a), and any dispute regarding such proper tax treatment shall be referred for resolution pursuant to Section 13 sufficiently in advance of the filing date of such Tax Return (including extensions) to permit timely filing of the return.

3.5. Right to Review Tax Returns.

(a) General. The Responsible Company with respect to any Tax Return shall make such Tax Return and related Tax Records available for review by the other Company, if requested, to the extent (i) such Tax Return relates to Taxes for which the requesting party may be liable, (ii) such Tax Return relates to Taxes for which the requesting party may be liable in whole or in part for any additional Taxes owing as a result of adjustments to the amount of Taxes reported on such Tax Return, (iii) such Tax Return relates to Taxes for which the requesting party may have a claim for Tax Benefits under this Agreement, or (iv) the requesting party reasonably determines that it must inspect such Tax Return to confirm compliance with the terms of this Agreement. The Responsible Company shall use its reasonable best efforts to make such Tax Return and Tax Records available for review as required under this paragraph sufficiently in advance of the due date for filing such Tax Returns to provide the requesting party with a meaningful opportunity to analyze and comment on such Tax Returns and have such Tax Returns modified before filing, taking into account the person responsible for payment of the Tax (if any) reported on such Tax Return and the materiality of the amount of Tax liability with respect to such Tax Return. The Companies shall attempt in good faith to resolve any issues arising out of the review of such Tax Returns or Tax Records.

(b) Execution of Returns Prepared by Other Party. In the case of any Tax Return which is required to be prepared and filed by one Company under this Agreement and which is required by law to be signed by another Company (or by its authorized representative), the

Company that is legally required to sign such Tax Return shall not be required to sign such Tax Return under this Agreement if there is no reasonable basis for the tax treatment of any material items reported on the Tax Return. Any such Tax Return shall be supplied by the Company responsible for its preparation and filing to the Company responsible for its signing at least five days prior to the due date of such Tax Return (including applicable extensions) and such signing Company shall deliver an executed copy of such Tax Return to the filing Company at least two days prior to the due date of such Tax Return (including applicable extensions).

SECTION 4. Refunds, Carrybacks and Tax Benefits.

4.1. Compensation for Use of CMC Consolidated Period Tax Items.

In the event that (i) the Cabot Group realizes an actual Tax Benefit during any Consolidated Period as a result of the use by members of the Cabot Group (other than members of the CMC Group) of Tax Items of the CMC Group and
(ii) as a result of such use the Federal Income Tax liability of the CMC Group for any period which is not a Consolidated Period is greater than the amount of such liability computed under the Stand Alone Method (but without regard to clauses (iii) and (iv) of the the third sentence of Section 2.5(a)), then Cabot will pay to CMC, in accordance with Section 5.7, an amount equal to the lesser of (x) the excess of the Tax Benefit actually realized by Cabot referred to in clause (i) over the amount of any prior payments to CMC pursuant to this Section 4.1 in respect of that Tax Benefit and (y) the excess referred to in clause (ii) for such non-Consolidated Period.

4.2. Claims for Refund, Carrybacks, and Self-Audit Adjustments ("Adjustment Requests").

(a) Consent Required for Adjustment Requests Related to Consolidated or Combined Income Tax Returns. Except as provided in paragraph (b) below, each of the Companies hereby agrees that, unless the other Company consents in writing, which consent shall not be

unreasonably delayed or withheld, no Adjustment Request shall be filed with respect to any Consolidated or Combined Tax Return that included the CMC Group for a Pre-Distribution Period and affects the CMC Group Tax liability. Any Adjustment Request which the Companies consent to make under this Section 4.2 shall be prepared and filed by the Responsible Company under Sections 3.2 and 3.3 for the Tax Return to be adjusted. The Company requesting the Adjustment Request shall provide to the Responsible Company all information required for the preparation and filing of such Adjustment Request in such form and detail as reasonably requested by the Responsible Company.

(b) Exception for Adjustment Requests Related to Audit Adjustments. Each Company shall be entitled, without the consent of the other Company, to require Cabot to file an Adjustment Request to take into account any net operating loss, net capital loss, deduction, credit, or other adjustment attributable to such Company or any member of its Group corresponding to any adjustment resulting from any audit by the Internal Revenue Service or other Tax Authority with respect to Consolidated or Combined Income Tax Returns for any Pre-Distribution Period. In addition, Cabot shall be entitled to require CMC to file a corresponding Adjustment Request with respect to Separate Company Taxes for any Pre-Distribution Periods.

(c) Other Adjustment Requests Permitted. Nothing in this Section 4.2 shall prevent any Company or its Affiliates from filing any Adjustment Request with respect to Tax Returns which are not Consolidated or Combined Income Tax Returns or with respect to any Other Taxes; provided, however, that neither Company shall file an amended Tax Return with respect to Separate Company or Other Taxes for which the other Company is liable under this Agreement without the written consent of such other Company (which consent shall not be unreasonably withheld). If any refund or credit is obtained as a result of any such Adjustment Request (or otherwise), the parties shall recalculate the amounts that would have

been paid under this Agreement based on the changes resulting in such refund or credit, and shall make such payments between them as necessary to place each in the position it would have been in had the payments made under this Agreement originally been made based on such changes.

(d) Payment of Refunds and other Tax Benefits. Except as set forth in
Section 4.2(e), any refunds or other Tax Benefits received by either Company (or any of its Affiliates) as a result of any Adjustment Request which are for the account of the other Company (or member of such other Company's Group) shall be paid by the Company receiving (or whose Affiliate received) such refund or Tax Benefit to such other Company in accordance with Section 5.

(e) Ordering of and Payment for Carrybacks.

(i) In the event that a member of the Cabot Group, on the one hand, and a member of the CMC Group, on the other hand, are each entitled to carryback a Tax Item to a Pre-Distribution Period, the respective Tax Items shall be used under the rules of applicable Tax Law (which shall be, in the case of Carrybacks to such Tax Periods of the affiliated group of which Cabot is the common parent, the rules contained in Treasury Regulation Section 1.1502-21T).

(ii) Any Tax refund or other Tax Benefit resulting from the Carryback of any member of one Group (the "Carryback Group") of any Tax Item arising after the Distribution Date to a Pre-Distribution Period shall be for the account of the Carryback Group (and in the event CMC Group is the Carryback Group, then upon receipt of the Tax refund or other Tax Benefit Cabot shall pay to CMC the amount of such Tax refund or other Tax Benefit); provided, however, that if at the time of the use of the Carryback Items of a member of the Carryback Group, a member of the other Group (the "Other Group") possesses Carryback Tax Items which, but for the ordering rule set forth in (i) above, would have been available to be used (the "Other Group Carryback") in lieu of the Carryback Group's Tax Items, then (but

only to the extent of the Other Group Carryback) the Carryback Group shall not be entitled to payment of the amount of such Tax refund or Tax Benefit until the earlier of (X) the date on which a member of the Other Group claims the Other Group Carryback on a Tax Return or (Y) the date on which a member of the Carryback Group would have been able to use the Carryback had it not been claimed with respect to the Pre-Distribution Period Tax Return.

(iii) In the event the Carryback of Tax Items of a member of the Cabot Group, or the CMC Group, as the case may be, does not result in a Tax refund, due to an offsetting Tax adjustment to a member of the Other Group, then the Other Group shall promptly pay the amount of any decrease in Tax liability resulting from the Carryback claim, provided, however, that in the event the Other Group possesses Carryback Items which, but for the ordering rules set forth in (i) above would have been available to be used in lieu of the Carryback Group's Items, then (but only to the extent of the Other Group Carryback), the Other Group shall not be required to pay the amount of such decrease in Tax liability to the Carryback Group until the earlier of (X) the date on which a member of the Other Group claims the Other Group Carryback on a Tax Return or (Y) the date on which a member of the Carryback Group would have been able to utilize the Carryback had it not been claimed with respect to the Pre-Distribution Period Tax Return.

4.3. Adjustment of Tax Items. In the event that the Carryback of Tax Items of one Group, or a Tax adjustment attributable to such Group under the terms of this Agreement, results in the disallowance or limitation of Tax Items claimed on the Tax Return as filed, the Carryback Group shall be responsible for any increase in Tax liability resulting from the disallowance or limitation of Tax attributes; provided, however, that in the event the disallowance or limitation of Tax attributes results in a Tax Benefit resulting from the use of such Tax attributes in another Tax Period, such Tax Benefit shall be deemed to be for the account of the Carryback Group for such purposes of this Agreement.

4.4. Adjustments on Audit. If, upon examination by any Tax Authority of any Tax Return including a member of the Cabot Group or CMC Group for any Tax Period, any item of deduction, credit or expense is disallowed for which Cabot is or may be liable for Taxes hereunder (or an item of income is required to be recognized on a Tax Return which was not reported on such Tax Return), in either such case resulting in a tax detriment suffered by the Cabot Group, and such disallowance (or recognition) results in a Tax Benefit to the CMC Group (with respect to that Tax Period or another Tax Period), then CMC shall pay to Cabot the amount of such Tax Benefit that is realized in the form of an actual reduction in Tax (which shall be computed by comparing the Tax which would have been owed by CMC but for the item giving rise to the Tax Benefit with the Tax owed by CMC taking such item into account) provided, however, that in no case will the amount that CMC is required to pay to Cabot with respect to such Tax Benefit exceed the corresponding tax detriment to Cabot (reduced by payments previously made by CMC to Cabot with respect to such Tax Benefit). Any payment required to be made hereunder shall be made in accordance with Section 5.10. The provisions of this Section 4.4 shall apply mutatis mutandis where an item of deduction, credit or expense is disallowed for which CMC is or may be liable for Taxes hereunder (or any item of income is required to be recognized on a Tax Return which was not reported on such Tax Return), as they apply where the Cabot Group suffers such a detriment. For avoidance of doubt, any payment required to be made by Cabot to the CMC Group under this Section 4.4 shall, to the extent applicable, be deemed as an offset to amounts owing by CMC to Cabot under
Section 2.1 hereof.

SECTION 5. Tax Payments and Intercompany Billings.

5.1. Payment of Taxes With Respect to Cabot Federal Consolidated Returns. In the case of any Cabot Federal Consolidated Return -

(a) Computation and Payment of Tax Due. At least ten business days prior to any Payment Date, Cabot shall compute the amount of Tax required to be paid to the Internal

Revenue Service (taking into account the requirements of Section 3.4 relating to consistent accounting practices) with respect to such Tax Return on such Payment Date and shall notify CMC in writing of the amount of Tax required to be paid on such Payment Date. Cabot will pay such amount to the Internal Revenue Service on or before such Payment Date.

(b) Computation and Payment of CMC Liability With Respect to Tax Due. Within 30 days following any Payment Date, CMC will pay to Cabot the excess (if any) of

(i) the amount of liability determined as of such Payment Date with respect to the applicable Tax Period allocable to CMC in a manner consistent with the provisions of Section 2.1, over

(ii) the amount equal to the cumulative net payments with respect to such Tax Return prior to such Payment Date made by CMC or members of its Group.

If the amount in clause (ii) above is greater than the amount in clause (i) above as of any Payment Date, then Cabot shall pay such excess to CMC within 30 days following the Payment Date.

(c) Interest on Intergroup Tax Allocation Payments. In the case of any payments to Cabot required under paragraph (b) of this Section 5.1, CMC shall also pay to Cabot an amount of interest computed at the Prime Rate on the amount of the payment required based on the number of days from the applicable Payment Date until the date of CMC's subsequent payment. In the case of any payments by Cabot required under paragraph (b) of this Section 5.1, Cabot shall also pay to CMC an amount of interest computed at the Prime Rate on the amount of the payment required based on the number of days from the applicable Payment Date until the date of Cabot's subsequent payment of such amount to CMC.

5.2. Payment of Federal Income Tax Related to Adjustments.

(a) Adjustments Resulting in Underpayments. Cabot shall pay to the Internal Revenue Service when due any additional Federal Income Tax required to be paid as a result of any

adjustment to the tax liability with respect to any Cabot Federal Consolidated Return. CMC shall pay to Cabot an amount that is allocable to CMC under Section 2.1 within 30 days from the later of (i) the date the additional Tax was paid by Cabot or (ii) the date of receipt by CMC of a written notice and demand from Cabot for payment of the amount due, accompanied by evidence of payment and a statement detailing the Taxes paid and describing in reasonable detail the particulars relating thereto. Any payments required under this Section 5.2 (a) shall include interest computed at the Prime Rate based on the number of days from the date the additional Tax was paid by Cabot to the date of the payment under this Section 5.2(a).

(b) Adjustments Resulting in Overpayments. Within 30 days of receipt by Cabot of any Tax Benefit resulting from any adjustment to the tax liability with respect to any Cabot Federal Consolidated Return, Cabot shall pay to CMC its share of any such Tax Benefit, as determined in accordance with the principles of Sections 2.1 and 4. Any payments required under this Section 5.2(b) shall include interest computed at the Prime Rate based on the number of days from the date the Tax Benefit was received by Cabot to the date of payment to CMC under this Section 5.2(b).

5.3. Payment of State Income Tax Relating to Pre-Distribution Periods.

(a) Computation and Payment of Tax Due. At least three business days prior to any Payment Date for any Tax Return with respect to any State Income Tax relating to a Pre-Distribution Period, the Responsible Company shall compute the amount of Tax required to be paid to the applicable Tax Authority (taking into account the requirements of Section 3.4 relating to consistent accounting practices) with respect to such Tax Return on such Payment Date and --

(i) If such Tax Return is with respect to a Consolidated or Combined State Income Tax, the Responsible Company shall, if Cabot is not the Responsible Company with

respect to such Tax Return, notify Cabot in writing of the amount of Tax required to be paid on such Payment Date. Cabot will pay such amount to such Tax Authority on or before such Payment Date.

(ii) If such Tax Return is with respect to a Separate Company Tax, the Responsible Company shall, if it is not the Company liable for the Tax reported on such Tax Return, notify the Company liable for such Tax in writing of the amount of Tax required to be paid on such Payment Date. The Company liable for such Tax will pay such amount to such Tax Authority on or before such Payment Date.

(b) Computation and Payment of CMC Liability With Respect to Tax Due. Within 30 days following the due date (including extensions) for filing any Tax Return for any Consolidated or Combined State Income Tax (excluding any Tax Return with respect to payment of estimated Taxes or Taxes due with a request for extension of time to file) relating to a Pre-Distribution Period, CMC shall pay to Cabot the Tax liability allocable to CMC as determined by Cabot under the provisions of Sections 2.2 and 4, plus interest computed at the Prime Rate on the amount of the payment based on the number of days from the due date (including extensions) to the date of payment by CMC to Cabot.

5.4. Payment of State Income Taxes Related to Adjustments.

(a) Adjustments Resulting in Underpayments. Cabot shall pay to the applicable Tax Authority when due any additional State Income Tax required to be paid as a result of any adjustment to the Tax liability with respect to any Tax Return for any Consolidated or Combined State Income Tax for any Pre-Distribution Period. CMC shall pay to Cabot its respective share of any such additional Tax payment determined in accordance with Sections 2.2 and 4 within 30 days from the later of (i) the date the additional Tax was paid by Cabot or (ii) the date of receipt by CMC of a written notice and demand from Cabot for payment of the amount due, accompanied by evidence of payment and a statement detailing the Taxes paid

and describing in reasonable detail the particulars relating thereto. CMC shall also pay to Cabot interest on its respective share of such Tax computed at the Prime Rate based on the number of days from the date the additional Tax was paid by Cabot to the date of its payment to Cabot under this Section 5.4(a).

(b) Adjustments Resulting in Overpayments. Within 30 days of receipt by Cabot of any Tax Benefit resulting from any adjustment to the Tax liability with respect to any Tax Return for any Consolidated or Combined State Income Tax for any Pre-Distribution Period, Cabot shall pay to CMC its share of any such Tax Benefit determined in accordance with the principles of Sections 2.2 and 4. Any payments required under this Section 5.4(b) shall include interest computed at the Prime Rate based on the number of days from the date the Tax Benefit was received by Cabot to the date of payment under this Section 5.4(b).

5.5. Payment of Separate Company Taxes and Other Taxes. Each Company shall pay, or shall cause to be paid, to the applicable Tax Authority when due all Separate Company Taxes and Other Taxes owed by such Company or a member of such Company's Group.

5.6. Indemnification Payments. If any Company (the "payor") is required to pay to a Tax Authority a Tax that another Company (the "responsible party") is required to pay to such Taxing Authority under this Agreement, the responsible party shall reimburse the payor within 30 days of delivery by the payor to the responsible party of an invoice for the amount due, accompanied by evidence of payment and a statement detailing the Taxes paid and describing in reasonable detail the particulars relating thereto. The reimbursement shall include interest on the Tax payment computed at the Prime Rate based on the number of days from the date of the payment to the Tax Authority to the date of reimbursement under this Section 5.6.

5.7. Compensation for use of CMC Consolidated Period Tax Items. In the event Cabot is required to pay CMC in accordance with Section 4.1, CMC shall deliver to Cabot an invoice stating the amount due to CMC, accompanied by a reasonably detailed calculation of that

amount, as prescribed by section 4.1. Cabot shall pay CMC within 30 days from the due date (including any extensions) for the Tax Return filed by CMC with respect to such amount, including interest computed at the Prime Rate based on the number of days from such due date to the date Cabot pays CMC.

5.8. Payment of Refunds and Other Tax Benefits. (a) Except as otherwise provided in this Agreement, if a member of one Group receives a Tax refund or other Tax Benefit with respect to Taxes for which a member of the other Group is liable hereunder, the Company receiving such Tax refund shall make a payment to the Company who is liable for such Taxes hereunder within 30 days following the receipt of the Tax refund in an amount equal to such Tax refund, plus interest on such amount computed at the Prime Rate based on the number of days from the date of receipt of the Tax refund to the date of payment under this Section 5.8.

(b) In the event one Group is reimbursed for its payment of a Tax liability of the other Group, the amount of such reimbursement shall be computed net of any Tax Benefit realized by the reimbursed Group as the result of payment of the other Group's Tax liability.

5.9. Payment for Carrybacks. Each Company shall pay the other Company for Carrybacks in accordance with Section 4.2(e). Any such payment shall include interest at the Prime Rate based on the number of days from the date Company is required to make the payment under Section 4.2(e) to the date the Company actually makes the payment.

5.10. Payment for Adjustments on Audit. Any payment required under Section 4.4 shall be made within 30 days of the due date (including any extensions) of the Tax Return on which the Tax Benefit described in that section is claimed. Such payment shall include interest computed at the Prime Rate based on the number of days from such due date to the date the payment is made.

SECTION 6. Assistance and Cooperation.

6.1. General. Each of the Companies shall cooperate (and cause their respective Affiliates to cooperate) with each other and with each other's agents, including accounting firms and legal counsel, in connection with Tax matters relating to the Companies and their Affiliates including (i) preparation and filing of Tax Returns, (ii) determining the liability for and amount of any Taxes due (including estimated Taxes) or the right to and amount of any refund of Taxes, (iii) examinations of Tax Returns, and (iv) any administrative or judicial proceeding in respect of Taxes assessed or proposed to be assessed. Such cooperation shall include making all information and documents in their possession relating to the other Companies and their Affiliates available to such other Companies as provided in Section 7. Each of the Companies shall also make available to each other, as reasonably requested and available, personnel (including officers, directors, employees and agents of the Companies or their respective Affiliates) responsible for preparing, maintaining, and interpreting information and documents relevant to Taxes, and personnel reasonably required as witnesses or for purposes of providing information or documents in connection with any administrative or judicial proceedings relating to Taxes. Any information or documents provided under this Section 6 shall be kept confidential by the Company receiving the information or documents, except as may otherwise be necessary in connection with the filing of Tax Returns or in connection with any administrative or judicial proceedings relating to Taxes.

6.2. Income Tax Return Information. Each Company will provide to each other Company information and documents relating to their respective Groups required by the other Companies to prepare Tax Returns. The Responsible Company shall determine a reasonable compliance schedule for such purpose in accordance with past practices. Any additional information or documents the Responsible Company requires to prepare such Tax Returns will

be provided in accordance with past practices, if any, or as the Responsible Company reasonably requests and in sufficient time for the Responsible Company to file such Tax Returns timely.

SECTION 7. Tax Records.

7.1. Retention of Tax Records. Except as provided in Section 7.2, each Company shall preserve and keep all Tax Records exclusively relating to the assets and activities of their respective Groups for Pre-Distribution Tax Periods, and Cabot shall preserve and keep all other Tax Records relating to Taxes of the Groups for Pre-Distribution Tax Periods, for so long as the contents thereof may become material in the administration of any matter under the Code or other applicable Tax Law, but in any event until the later of (i) the expiration of any applicable statutes of limitation, as extended, and (ii) seven years after the Distribution Date. If, prior to the expiration of the applicable statute of limitation and such seven-year period, a Company reasonably determines that any Tax Records which it is required to preserve and keep under this Section 7 are no longer material in the administration of any matter under the Code or other applicable Tax Law, such Company may dispose of such records upon 90 days prior written notice to the other Company. Such notice shall include a list of the records to be disposed of describing in reasonable detail each file, book, or other record accumulation being disposed. The notified Company shall have the opportunity, at its cost and expense, to copy or remove, within such 90-day period, all or any part of such Tax Records.

7.2. State Income Tax Returns. Tax Returns with respect to State Income Taxes and workpapers prepared in connection with preparing such Tax Returns shall be preserved and kept, in accordance with the guidelines of Section 7.1, by the Company responsible for preparing and filing the applicable Tax Return.

7.3. Access to Tax Records. The Companies and their respective Affiliates shall make available to each other for inspection and copying during normal business hours upon reasonable notice all Tax Records in their possession to the extent reasonably requested by the other

Company in connection with the preparation of Tax Returns, audits, litigation, or the resolution of items under this Agreement.

SECTION 8. Tax Contests.

8.1. Notice. Each of the parties shall provide prompt notice to the other party of any pending or threatened Tax audit, assessment or proceeding or other Tax Contest of which it becomes aware related to Taxes for Tax Periods for which it is indemnified by the other party hereunder. Such notice shall contain factual information (to the extent known) describing any asserted Tax liability in reasonable detail and shall be accompanied by copies of any notice and other documents received from any Tax Authority in respect of any such matters. If an indemnified party has knowledge of an asserted Tax liability with respect to a matter for which it is to be indemnified hereunder and such party fails to give the indemnifying party prompt notice of such asserted Tax liability, then (i) if the indemnifying party is precluded from contesting the asserted Tax liability in any forum as a result of the failure to give prompt notice, the indemnifying party shall have no obligation to indemnify the indemnified party for any Taxes arising out of such asserted Tax liability, and (ii) if the indemnifying party is not precluded from contesting the asserted Tax liability in any forum, but such failure to give prompt notice results in a monetary detriment to the indemnifying party, then any amount which the indemnifying party is otherwise required to pay the indemnified party pursuant to this Agreement shall be reduced by the amount of such detriment.

8.2. Control of Tax Contests. Each Company shall have full responsibility and discretion in handling, settling or contesting any Tax Contest involving a Tax for which it is liable pursuant to Section 2 of this Agreement; provided, however, Cabot shall have full responsibility and discretion in handling, settling or contesting any Tax Contest with respect to a Consolidated or Combined Income Tax Return of the Cabot Group. Furthermore, Cabot may participate in any

Tax Contest with respect to Restructuring Taxes regardless of whether it has liability or indemnification obligations with respect to such Taxes under this Agreement.

SECTION 9. No Inconsistent Actions.

(a) Each of the Companies covenants and agrees that it will not take any action, and it will cause its Affiliates to refrain from taking any action, which may be inconsistent with the Tax treatment of the Transactions as contemplated in the IRS Private Letter Ruling (any such action is referred to in this Section 9 as a "Tainting Act"), unless (i) the Company or Affiliate thereof proposing such Tainting Act (the "Requesting Party") either (A) obtains a ruling with respect to the Tainting Act from the Internal Revenue Service or other applicable Tax Authority that is reasonably satisfactory to the other Company (the "Requested Party") (except that the Requesting Party shall not submit any such ruling request if a Requested Party determines in good faith that filing such request might have a materially adverse effect upon such Requested Party), or (B) obtains an unqualified opinion reasonably acceptable to each Requested Party of independent nationally recognized tax counsel acceptable to each Requested Party, on a basis of assumed facts and representations consistent with the facts at the time of such action, that such Tainting Act will not affect the Tax treatment of the Transactions as contemplated in the IRS Private Letter Ruling, or (ii) each Requested Party consents in writing to such Tainting Act, which consent shall be granted or withheld in the sole and absolute discretion of each such Requested Party. Without limiting the foregoing:

(i) Specified Actions. During the two year period following the Distribution Date, unless clause (i) or (ii) of the preceding paragraph is satisfied with respect to the applicable action, no Company or its Affiliate will (A) liquidate or merge with or into any other corporation (other than a merger which results in the outstanding stock of such Company or its Affiliates immediately before the merger continuing to represent at least

fifty-five (55) percent of the outstanding voting stock and non-voting stock of the merged corporations after the transaction); (B) issue more than thirty-five (35) percent, by vote or value, of its capital stock in one or more transactions, including the Initial Public Offering; (C) redeem, purchase or otherwise reacquire its capital stock in one or more transactions, except to the extent such redemption, purchase or reacquisition meets the requirements of section 4.05(1)(b) of Revenue Procedure 96-30; (D) sell, exchange, distribute or otherwise dispose of, other than in the ordinary course of business, more than forty (40) percent of the assets constituting the trades or businesses relied upon in the IRS Private Letter Ruling to satisfy Section 355(b) of the Code; or (E) discontinue or cause to be discontinued the active conduct of the trades or businesses relied upon in the IRS Private Letter Ruling to satisfy Section 355(b) of the Code.

(ii) No Inconsistent Plan or Intent. Each of the Companies represents and warrants that neither it nor any of its Affiliates has any plan or intent to take any action which is inconsistent with any factual statements or representations in the IRS Private Letter Ruling. Regardless of any change in circumstances, each of the Companies covenants and agrees that it will not take, and it will cause its Affiliates to refrain from taking, any such inconsistent action on or before the last day of the calendar year ending after the second anniversary of the Distribution Date other than as permitted in this
Section 9.

(iii) 355(e) Covenant. Without in any manner limiting paragraphs (i) or
(ii) immediately above, each of Cabot and CMC covenants and agrees that, during the two-year periods ending on and beginning on the Distribution Date, unless clause (i) or (ii) of section 9(a) of this Agreement is satisfied with respect to the applicable action, it will not enter into any negotiations, agreements or arrangements with respect to transactions or events (including stock issuances, option grants, capital contributions or acquisitions, but not including the Initial Public Offering), which may cause the Distribution to be

treated as part of a plan pursuant to which one or more persons acquire directly or indirectly Cabot or CMC stock, as the case may be, representing a "50 percent or greater interest" within the meaning of
Section 355(e)(4) of the Code.

(iv) Amended or Supplemental Rulings. Each of the Companies covenants and agrees that it will not file, and it will cause its Affiliates to refrain from filing, any amendment or supplement to the IRS Private Letter Ruling request with respect to the Transactions subsequent to the Distribution Date without the consent of the other Companies, which consent shall not be unreasonably withheld.

(b) Notwithstanding anything to the contrary in this Agreement, each Company shall be solely liable for, and shall indemnify and hold harmless the other Company from any Restructuring Tax resulting from a Tainting Act by such first Company or its Affiliates, regardless of whether clause (i) or
(ii) of Section 9(a) was satisfied with respect to such Tainting Act.

SECTION 10. Survival of Obligations. The representations, warranties, covenants and agreements set forth in this Agreement shall be unconditional and absolute and shall remain in effect without limitation as to time.

SECTION 11. Employee Matters. Each of the Companies agrees to utilize, or cause its Affiliates to utilize, the alternative procedure set forth in section 5 of Revenue Procedure 96-60, 1996-2 C.B. 399, with respect to wage reporting.

SECTION 12. Treatment of Payments; Tax Gross Up.

12.1. Treatment of Tax Indemnity and Tax Benefit Payments. In the absence of any change in tax treatment under the Code or other applicable Tax Law, any Tax indemnity payments or Tax Benefit payments made by a Company under
Section 5 shall be reported for Tax purposes by the payor and the recipient as distributions or capital contributions, as appropriate, occurring immediately before the Distribution on the Distribution Date, but only

to the extent the payment does not relate to a Tax allocated to the payor in accordance with Treasury Regulation Section 1.1502-33(d) (or under corresponding principles of other applicable Tax Laws).

12.2. Tax Gross Up. If notwithstanding the manner in which Tax indemnity payments and Tax Benefit payments were reported, there is an adjustment to the Tax liability of a Company as a result of its receipt of a payment pursuant to this Agreement, such payment shall be appropriately adjusted so that the amount of such payment, reduced by the amount of all Income Taxes payable with respect to the receipt thereof (but taking into account all correlative Tax Benefits resulting from the payment of such Income Taxes), shall equal the amount of the payment which the Company receiving such payment would otherwise be entitled to receive pursuant to this Agreement.

12.3. Interest Under This Agreement. Anything herein to the contrary notwithstanding, to the extent one Company ("indemnitor") makes a payment of interest to another Company ("indemnitee") under this Agreement with respect to the period from the date that the indemnitee made a payment of Tax to a Tax Authority to the date that the indemnitor reimbursed the indemnitee for such Tax payment, or with respect to the period from the date that the indemnitor received a Tax Benefit to the date indemnitor paid the indemnitee with respect to such Tax Benefit, the interest payment shall be treated as interest expense to the indemnitor (deductible to the extent provided by law) and as interest income by the indemnitee (includible in income to the extent provided by law). The amount of the payment shall not be adjusted under Section 12.2 to take into account any associated Tax Benefit to the indemnitor or increase in Tax to the indemnitee.

SECTION 13. Disagreements. If after good faith negotiations the parties cannot agree on the application of this Agreement to any matter, then the matter will be referred to an accounting firm acceptable to each of the parties (the "Accounting Firm"). The Accounting Firm shall

furnish written notice to the parties of its resolution of any such disagreement as soon as practical, but in any event no later than 45 days after its acceptance of the matter for resolution. Any such resolution by the Accounting Firm will be conclusive and binding on all parties to this Agreement. In accordance with Section 15, each party shall pay its own fees and expenses (including the fees and expenses of its representatives) incurred in connection with the referral of the matter to the Accounting Firm. All fees and expenses of the Accounting Firm in connection with such referral shall be shared equally by the parties affected by the matter.

SECTION 14. Late Payments. Any amount owed by one party to another party under this Agreement which is not paid when due shall bear interest at the Prime Rate plus two percent, compounded on each March 31, June 30, September 30 and December 31, from the due date of the payment to the date paid. To the extent interest required to be paid under this Section 14 duplicates interest required to be paid under any other provision of this Agreement, interest shall be computed at the higher of the interest rate provided under this Section 14 or the interest rate provided under such other provision.

SECTION 15. Expenses. Except as provided in Section 14, each Company and its Affiliates shall bear their own expenses incurred in connection with preparation of Tax Returns, Tax Contests, and other matters related to Taxes under the provisions of this Agreement.

SECTION 16. General Provisions.

16.1. Notices. All notices and other communications hereunder shall be in writing and shall be delivered in person, by telecopy, by express or overnight mail delivered by a nationally recognized air courier (delivery charges prepaid), or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties as follows:

(a) If to Cabot, to:

Cabot Corporation
75 State Street
Boston, Massachusetts 02109

Attention: Chief Financial Officer Telecopy No.: (617) 642-6281

With a copy to:

Law Department
Cabot Corporation
75 State Street
Boston, Massachusetts 02109

Attention: General Counsel Telecopy No.: (617) 342-6039

(b) If to CMC, to:

Cabot Microelectronics Corporation
870 North Commons Drive
Aurora, Illinois 60504

Attention: President

Telecopy No.: (630) 375-5593

or to such other address as the party to whom notice is given may have previously furnished to the others in writing in the manner set forth above. Any notice or communication delivered in person shall be deemed effective on delivery or when delivery is refused. Any notice or communication sent by telecopy or by air courier shall be deemed effective on the first Business Day at the place at which such notice or communication is received following the day on which such notice or communication was sent.

16.2. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall

constitute one and the same agreement. The Agreement may be delivered by facsimile transmission of a signed copy thereof.

16.3. Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon the parties hereto and inure to the benefit of the parties hereto and their respective successors and permitted assigns. Except with respect to a merger of either party, neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by either party hereto without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed; provided, however, that Cabot and CMC may assign their respective rights, interests, duties, liabilities and obligations under this Agreement to any of their respective subsidiaries, but such assignment shall not relieve Cabot or CMC, as the assignee, of its obligations hereunder. The schedules attached hereto or referred to herein are an integral part of this Agreement and are hereby incorporated into this Agreement and made a part hereof as if set forth in full herein.

16.4. Dispute Resolution. Resolution of any and all disputes arising from or in connection with this Agreement, whether based on contract, tort, or otherwise (collectively, "Disputes"), shall be exclusively governed by and settled in accordance with the provisions of Section 13 and this Section 16.5. The parties hereto shall use all commercially reasonable efforts to settle all Disputes without resorting to mediation, arbitration, litigation or other third party dispute resolution mechanisms. If any Dispute remains unsettled, the parties hereby agree to mediate such Dispute using a mediator reasonably acceptable to all parties involved in such Dispute. If the parties are unable to resolve such dispute through mediation, each party will be free to commence proceedings for the resolution thereof. No party shall be entitled to consequential, special, exemplary or punitive damages.

16.5. Severability. Any provision of this Agreement which is

prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such

prohibition or unenforceability without invalidating the remaining provisions hereof. Any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

16.6. Waiver. The observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) by the party entitled to enforce such term, but such waiver shall be effective only if it is in writing signed by the party against which such waiver is to be asserted. Unless otherwise expressly provided in this Agreement, no delay or omission on the part of any party in exercising any right or privilege under this Agreement shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right or privilege under this Agreement operate as a waiver of any other right or privilege under this Agreement nor shall any single or partial exercise of any right or privilege preclude any other or further exercise thereof or the exercise of any other right or privilege under this Agreement. No failure by either party to take any action or assert any right or privilege hereunder shall be deemed to be a waiver of such right or privilege in the event of the continuation or repetition of the circumstances giving rise to such right unless expressly waived in writing by the party against whom the existence of such waiver is asserted.

16.7. Amendment. This Agreement may not be amended or modified in any respect except by a written agreement signed by both of the parties hereto.

16.8. Authority. Each of the parties hereto represents to the other that (a) it has the corporate power and authority to execute, deliver and perform this Agreement, (b) the execution, delivery and performance of this Agreement by it has been duly authorized by all necessary corporate action, (c) it has duly and validly executed and delivered this Agreement, and (d) this Agreement is a legal, valid and binding obligation, enforceable against it in accordance with its terms subject to applicable bankruptcy, insolvency, reorganization,

moratorium or other similar laws affecting creditors' rights generally and general equity principles.

16.9. Interpretation. The headings contained in this Agreement, in any Schedule hereto and in the table or contents to this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Any capitalized term used in any Schedule but not otherwise defined therein, shall have the meaning assigned to such term in this Agreement. When a reference is made in this Agreement to an Article or a
Section or Schedule, such reference shall be to an Article or Section of, or a Schedule to, this Agreement unless otherwise indicated.

16.10. Effective Time. This Agreement shall become effective upon the closing of CMC's Initial Public Offering.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by the respective officers as of the date set forth above.

CABOT CORPORATION

By:   /s/ Samuel W. Bodman
      --------------------------

Name:   Samuel W. Bodman

Title:   Chairman and CEO

CABOT MICROELECTRONIC CORPORATION

By:   /s/ Matthew Neville
      --------------------------

Name:  Matthew Neville

Title:   President and CEO

Exhibit 10.4

MANAGEMENT SERVICES AGREEMENT

DATED AS OF MARCH 28, 2000,

BY AND BETWEEN

CABOT CORPORATION

and

Cabot Microelectronics Corporation

Exhibit 10.4

MANAGEMENT SERVICES AGREEMENT

This Management Services Agreement (this "Agreement") is executed as of the 28th day of March, 2000 by and between Cabot Corporation, a Delaware corporation ("Cabot"), and Cabot Microelectronics Corporation, a Delaware corporation ("CMC"). Notwithstanding the execution date hereof, this Agreement shall become effective upon the date of the Initial Public Offering (as defined below).

RECITALS

WHEREAS, CMC is issuing shares of Common Stock, $.001 par value per share ("Common Stock"), to the public in an offering registered under the Securities Act of 1933, as amended;

WHEREAS, Cabot has heretofore directly or indirectly provided certain administrative, financial, management and other services to CMC and to its predecessor, the Microelectronics Materials Division of Cabot;

WHEREAS, on the terms and subject to the conditions set forth herein, CMC desires to retain Cabot as an independent contractor to provide, directly or indirectly, certain of those services to CMC after the Contribution Date (as defined below); and

WHEREAS, on the terms and subject to the conditions set forth herein, Cabot desires to provide, directly or indirectly, such services to CMC.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Cabot and CMC, for themselves, their successors and assigns, hereby agree as follows:

ARTICLE I
DEFINITIONS

Section 1.01. DEFINITIONS. As used in this Agreement, the following terms will have the following meanings, applicable both to the singular and the plural forms of the terms described:

"Agreement" has the meaning ascribed thereto in the preamble hereto, as such agreement may be amended and supplemented from time to time in accordance with its terms.

"Cabot Entities" means Cabot and its Subsidiaries and "Cabot Entity" shall mean any of the Cabot Entities.

"Cabot Indemnified Person" has the meaning ascribed thereto in Section 4.01.

"Contribution Date" shall have the meaning ascribed thereto in the Separation Agreement.

"Distribution Date" means any date or dates, as the case may be, determined by Cabot, in its sole and absolute discretion, to be a date on which shares of CMC common stock held by Cabot are distributed in connection with the Distribution (as defined in the Initial Public Offering and Distribution Agreement).

"Initial Public Offering" means the initial public offering by CMC of shares of CMC common stock as contemplated by the IPO Registration Statement (as defined in the Initial Public Offering and Distribution Agreement).

"MMD Business" has the meaning ascribed to such term in the Separation Agreement.

"Outsourced Service" has the meaning ascribed thereto in Section 2.03.

"Person" means any individual, partnership, limited liability company, joint venture, corporation, trust, unincorporated organization, government (and any department or agency thereof) or other entity.

"Separation Agreement" means the Master Separation Agreement, of even date herewith, among Cabot and certain of its subsidiaries and CMC pursuant to which, among other things, the MMD Business will be separated from the business and operations of Cabot.

"Service Charges" has the meaning ascribed thereto in Section 3.01(c).

"Services" has the meaning ascribed thereto in Section 2.01.

"Subsidiary" means, as to any Person, any corporation, association, partnership, joint venture or other business entity of which more than 50% of the voting capital stock or other voting ownership interests is owned or controlled directly or indirectly by such Person or by one or more of the Subsidiaries of such Person or by a combination thereof; PROVIDED, HOWEVER, that any reference in this Agreement to a Subsidiary or Subsidiaries of Cabot shall not include CMC.

Section 1.02. INTERNAL REFERENCES. Unless the context indicates otherwise, references to Articles, Sections and paragraphs shall refer to the corresponding articles, sections and paragraphs in this Agreement and references to the parties shall mean the parties to this Agreement.

ARTICLE II
PURCHASE AND SALE OF SERVICES

Section 2.01. PURCHASE AND SALE OF SERVICES. On the terms and subject to the conditions set forth in this Agreement and in consideration of the Service Charges

described below, Cabot agrees to provide to CMC, and CMC agrees to purchase from Cabot, the services described in Schedule I (the "Services"). At its option, Cabot may cause any Service it is required to provide hereunder to be provided by any Cabot Entity. Unless otherwise specifically agreed by Cabot and CMC, the Services to be provided by Cabot hereunder shall be substantially similar in scope, quality and nature to those provided to CMC prior to the Contribution Date and shall be performed by the same or similarly qualified personnel; PROVIDED, HOWEVER, that the selection of personnel to perform the Services shall be at the sole discretion of Cabot; and PROVIDED, FURTHER, that, except as expressly provided in this Agreement, Cabot shall not be required to materially increase the volume, scope or quality of the Services provided to CMC beyond that which has been provided to the Microelectronics Materials Division of Cabot prior to the Contribution Date.

Section 2.02. ADDITIONAL SERVICES. In addition to the Services to be provided by Cabot pursuant to Section 2.01, if requested by CMC, and to the extent that Cabot and CMC may mutually agree in writing, Cabot shall provide additional services (including services not provided by Cabot to the Microelectronics Materials Division of Cabot prior to the Contribution Date) to
CMC. The scope of any such services, as well as the term, costs and other terms and conditions applicable to such services, shall be as mutually agreed by Cabot and CMC. Nothing herein shall create any obligation on the part of Cabot to provide any additional services.

Section 2.03. SERVICES PERFORMED BY THIRD PARTIES. At its option, Cabot may cause any Service it is required to provide hereunder to be provided by any third party that is providing, or may from time to time provide, the same or similar services for Cabot (an "Outsourced Service"). Cabot shall remain responsible, in accordance with the terms of this Agreement, for performance of any Service it causes to be so provided.

Section 2.04. IMPRACTICABILITY AND FORCE MAJEURE. Cabot shall not be required to provide any Service to the extent the performance of such Service becomes impracticable as a result of a cause or causes outside the control of Cabot or to the extent the provision of such Service would require Cabot to violate any applicable laws, rules or regulations. Cabot shall have no obligation to perform or cause the Services to be performed if its failure to do so is caused by or results from any act of God, governmental action, natural disaster, strike, failure of essential equipment or any other cause or circumstance beyond the control of Cabot or, if applicable, third party providers of services to Cabot (an "Event of Force Majeure"). Cabot will notify CMC of any Event of Force Majeure affecting its Services to CMC. Cabot agrees that following any Event of Force Majeure, CMC shall have no obligation to pay for the Services affected thereby and Cabot will use its reasonable best efforts to restore such Services.

ARTICLE III
SERVICE CHARGES

Section 3.01. SERVICE CHARGES(a) The charge for each Service provided to CMC hereunder directly by Cabot or any Cabot Entity shall be equal to all costs reasonably incurred by Cabot or any Cabot Entity in providing such Service. Such costs shall include, but are not limited to, appropriate allocation of overhead costs, personnel costs (e.g., compensation and fringe benefits ), travel, office costs, and incentive compensation costs associated with functions performing such Services.

(b) The charge for each Outsourced Service provided to CMC hereunder shall be equal to all costs reasonably incurred by Cabot or any Cabot Entity in providing such Outsourced Service, including, without limitation, any reasonable third-party costs and expenses incurred by Cabot or any Cabot Entity on behalf of CMC. If Cabot incurs third-party costs or expenses on behalf of CMC as well as any Cabot Entity, Cabot will allocate any such costs or expenses in good faith between CMC and the various Cabot Entities on behalf of which such costs or expenses were incurred as Cabot shall determine in the exercise of its reasonable judgment. Cabot shall apply usual and accepted accounting conventions in making such allocations and Cabot or its agents shall keep and maintain such books and records as may be reasonably necessary to make such allocations. Cabot shall make copies of such books and records available to CMC upon request and with reasonable notice.

(c) The parties intend that the Service charges referred to in paragraphs (a) and (b) above (collectively, the "Service Charges") will allow Cabot and any Cabot Entity to recover the fully allocated costs of providing the Services and Outsourced Services hereunder plus all out-of-pocket, third-party costs, charges and expenses, but without any profit to Cabot or any Cabot Entity.

Section 3.02. INVOICING AND SETTLEMENT OF COSTS. (a) Cabot shall invoice CMC for all Service Charges for each calendar month within thirty (30) days following the end of such month, provided that any failure by Cabot to provide an invoice within such time period shall not relieve CMC of its obligation to pay an invoice received after such date. All invoices shall reflect in reasonable detail a description of the Service performed.

(b) Subject to Section 3.02(c) below, CMC shall pay within thirty (30) days following its receipt of any invoice from Cabot pursuant to paragraph (a), without set-off, all amounts invoiced by Cabot during the preceding calendar month. If CMC fails to pay any monthly payment within sixty (60) days following its receipt of any invoice from Cabot pursuant to paragraph (a), CMC shall pay, in addition to the amount indicated in such invoice, interest on such amount at the prime interest rate as published in the Wall Street Journal plus 1% per annum compounded monthly for the period such amount remains unpaid.

(c) In the event of a dispute as to the propriety of the amount invoiced, CMC shall pay all undisputed amounts, but shall be entitled to withhold payment of any amount in dispute (and shall not be obligated to pay interest on the amount so withheld) and shall endeavor to notify Cabot within ten (10) business days from receipt of any disputed

invoice of the disputed amount and the reasons each such charge is disputed by CMC, provided that the failure to so notify Cabot within such time period shall not prevent CMC from disputing such invoice. Cabot shall provide to CMC, or shall cause its Subsidiaries to so provide, records relating to the disputed amount so as to enable the parties to resolve the dispute. The parties shall use reasonable efforts to resolve any such dispute promptly.

(d) Any invoice or payment not disputed in writing by either party within 180 days of such invoice or payment, as the case may be, shall be considered final and no longer subject to adjustment.

ARTICLE IV
LIMITATION OF LIABILITY; INDEMNIFICATION

Section 4.01. LIMITATION OF LIABILITY. CMC agrees that Cabot and each of its Subsidiaries and their respective directors, officers, agents and employees (each, a "Cabot Indemnified Person") shall only be liable to CMC for or in connection with the Services rendered or to be rendered by any Cabot Indemnified Person pursuant to this Agreement, the transactions contemplated hereby or any Cabot Indemnified Person's actions or inactions in connection with any such Services or transactions for claims, damages, losses, obligations, liabilities, costs and expenses (including, without limitation, reasonable attorneys' fees) resulting from, or arising out of, breach of contract, gross negligence or willful misconduct on the part of any Cabot Indemnified Person.

Section 4.02. INDEMNIFICATION OF CABOT BY CMC. CMC agrees to indemnify and hold harmless each Cabot Indemnified Person from and against any claims, damages, losses, obligations, liabilities, costs and expenses (including, without limitation, reasonable attorneys' fees) arising out of or in connection with Services rendered or to be rendered by any Cabot Indemnified Person pursuant to this Agreement, the transactions contemplated hereby or any Cabot Indemnified Person's actions or inactions in connection with any such Services or transactions except for claims, damages, losses, obligations, liabilities, costs and expenses (including, without limitation, reasonable attorneys' fees) resulting from, or arising out of, breach of contract, gross negligence or willful misconduct on the part of any Cabot Indemnified Person.

ARTICLE V
TERM AND TERMINATION

Section 5.01. TERM. (a) This Agreement shall commence on the date of the Initial Public Offering, and shall continue until the earlier of (i) the Distribution Date or (ii) two years after the date of the Initial Public Offering (the "Initial Term"); provided, however, that Cabot and CMC may, by mutual agreement, provide for the continuation of certain services after the Distribution Date.

(b) Notwithstanding Section 5.02(a), the obligation of Cabot to provide legal Services under this Agreement shall automatically terminate on the date that Cabot ceases to own shares of Common Stock representing more than 50% of the outstanding shares of Common Stock.

(c) Either party may terminate this Agreement with respect to any one or more of the Services if the other party shall have failed to perform any of its material obligations under this Agreement relating to any such Service or Services, the aggrieved party has notified the other party in writing of such failure, and such failure shall have continued for a period of 30 days after receipt by the other party of notice of such failure.

Section 5.02. EFFECT OF TERMINATION. Other than as required by law, upon termination of any Service pursuant to Section 5.01 or Section 5.02, Cabot will have no further obligation to provide the terminated Service (or any Service, in the case of termination of this Agreement) and CMC will have no obligation to pay any fees relating to such Service or make any other payments hereunder; PROVIDED that notwithstanding such termination, (i) CMC shall remain liable to Cabot for fees owed and payable in respect of any Service provided prior to the effective date of the termination and (ii) the provisions of Articles III, V and VI shall survive any such termination.

ARTICLE VI
MISCELLANEOUS

Section 6.01. PERFORMANCE UNDER ANCILLARY AGREEMENTS. Notwithstanding anything to the contrary contained herein, CMC shall not be charged anything under this Agreement for any Services that are specifically required to be performed under the Separation Agreement or any other Ancillary Agreement (as defined in the Separation Agreement) and any such other Services shall be performed and charged for in accordance with the terms of the Separation Agreement or such other Ancillary Agreement.

Section 6.02. NO AGENCY. Nothing in this Agreement shall constitute or be deemed to constitute a partnership or joint venture between the parties hereto or constitute or be deemed to constitute any party the agent or employee of the other party for any purpose whatsoever and neither party shall have authority or power to bind the other or to contract in the name of, or create a liability against, the other in any way or for any purpose.

Section 6.03. COMPANY AS SOLE BENEFICIARY. CMC acknowledges that the Services shall be provided only with respect to the business of CMC and its Subsidiaries as currently operated and as currently projected to be operated or as mutually agreed by the parties hereto. CMC shall not request performance of any Service for the benefit of any entity other than CMC and its Subsidiaries. CMC represents and agrees

that CMC will use the Services only in accordance with all applicable federal, state and local laws and regulations, and in accordance with past practices. Cabot reserves the right to take all actions, including termination of any particular Service, that Cabot reasonably believes to be necessary to assure compliance with applicable laws and regulations. Cabot will notify CMC promptly of the reasons for any such termination of Services.

Section 6.04. ENTIRE AGREEMENT. This Agreement (including the Schedule constituting a part of this Agreement) and any other writing signed by the parties that specifically references this Agreement constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements, understandings and negotiations, both written and oral, between the parties with respect to the subject matter hereof. This Agreement is not intended to confer upon any Person other than the parties hereto any rights or remedies hereunder.

Section 6.05. INFORMATION. Subject to applicable law and privileges, each party hereto covenants and agrees to provide the other party with all information regarding itself and transactions under this Agreement that the other party reasonably believes are required to comply with all applicable federal, state, county and local laws, ordinances, regulations and codes, including, but not limited to, securities laws and regulations.

Section 6.06. CONFIDENTIALITY. Each of Cabot and CMC agree to keep confidential and not disclose, and shall cause their respective subsidiaries and affiliates to keep confidential and not disclose, to any party or use for any purpose (other than the performance of this Agreement), any proprietary or other confidential information of the other party which is received pursuant to this Agreement ("Confidential Information"). Confidential Information shall be subject to the restrictions of this paragraph only if it is marked as confidential or proprietary or, if not disclosed in tangible form, the disclosing party notifies the recipient of its confidential or proprietary nature prior to its disclosure. For purposes of this Agreement, Confidential Information of a party does not include, and a party and a party's subsidiaries and affiliates will have no obligations under this provision with respect to, any information of the other party or any subsidiary or affiliate of the other party (the other party and subsidiaries and affiliates of the other party being referred to as the "receiving party") which:

(i) is already known to the receiving party from a source other than the disclosing party as evidenced by competent proof thereof; or

(ii) is or becomes publicly known through no wrongful act of the receiving party (in which event the receiving party's obligations under this Agreement in respect thereto shall terminate on the date such information enters the public domain); or

(iii) is rightfully received by the receiving party from a third party without violation of any obligations of confidentiality owed by the third party to the disclosing party; or

(iv) is disclosed by the disclosing party to a third party without restrictions on the third party's right to use or disclose such information; or

(v) is independently developed by employees or consultants of the receiving party without use of or reference to the disclosing party's Confidential Information; or

(vi) is approved for release by written authorization of the disclosing party

Section 6.07. PROTECTIVE ARRANGEMENTS. In the event that any party hereto (or any of its Subsidiaries) either determines on the advice of its counsel that it is required to disclose any information pursuant to applicable law or receives any demand under lawful process or from any governmental department, commission, board, bureau, agency or official to disclose or provide information of any other party hereto (or any of its Subsidiaries) that is subject to the confidentiality provisions hereof, such party shall notify the other party prior to disclosing or providing such information and shall cooperate at the expense of the requesting party in seeking any reasonable protective arrangements requested by such other party. Subject to the foregoing, the party that received such request may thereafter disclose or provide information to the extent required by such law (as so advised by counsel) or by lawful process or such governmental department, commission, board, bureau, agency or official.

Section 6.08. NOTICES. Any notice, instruction, direction or demand under the terms of this Agreement required to be in writing will be duly given upon delivery, if delivered by hand, facsimile transmission, intercompany mail, or mail, to the following addresses:

(a) If to Cabot, to:

Cabot Corporation
75 State Street
Boston, Massachusetts 02109

Attention: Paul Zack
Telecopy No.:617-342-6303

(b) If to CMC, to:

Cabot Microelectronics Corporation 870 North Commons Drive Aurora, Illinois 60504

Attention: Daniel Wobby Telecopy No.:630-375-5593

or to such other addresses or telecopy numbers as may be specified by like notice to the other parties.

Section 6.08. GOVERNING LAW. This Agreement shall be construed in accordance with and governed by the substantive internal laws of the State of Delaware.

Section 6.09. SEVERABILITY. If any provision of this Agreement shall be invalid or unenforceable, such invalidity or unenforceability shall not render the entire Agreement invalid. Rather, the Agreement shall be construed as if not containing the particular invalid or unenforceable provision, and the rights and obligations of each party shall be construed and enforced accordingly.

Section 6.10. AMENDMENT. This Agreement may only be amended by a written agreement executed by both parties hereto.

Section 6.11. COUNTERPARTS. This Agreement may be executed in separate counterparts.

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their duly authorized representatives.

CABOT CORPORATION

By:   /s/ Samuel W. Bodman
    ---------------------------------------------
     Name: Samuel W. Bodman
     Title:  Chairman and Chief Executive Officer

CABOT MICROELECTRONICS CORPORATION

By:   /s/ Matthew Neville
    ---------------------------------------------
     Name: Matthew Neville
     Title: President

SCHEDULE I

Cabot Corporation ("Cabot")

Cabot Microelectronics Corporation ("CMC")

--------------------------------------------------------------------------------
   SERVICE
    AREA                                  DESCRIPTION
--------------------------------------------------------------------------------
Corporate            Continue to provide general corporate affairs services
Affairs              commensurate with past efforts
--------------------------------------------------------------------------------
SH&E                 Product Stewardship:  MSDS development; product regulatory
                     status determination; product notification/product
                     registration; product toxicological determination; support
                     during transition to new CMC.  Cabot Corporate SHE
                     Compliance Assurance Reviews. SH&E policies and
                     procedures, technical guidance.  Safety, Industrial
                     Hygiene Process Safety Management.
--------------------------------------------------------------------------------
Information          Planning: Requirements definition, architecture & software
Services             acquisition, infrastructure design & vendor selection,
                     contract negotiation support, and implementation. Establish
                     spin-off environment (up to 1.25 FTE's): Applications;
                     integrator selection, co-lead project, participate in
                     CRP's, data bridging, technical support, Infrastructure;
                     support implementation, data design, project plan review,
                     vendor management.
--------------------------------------------------------------------------------
Legal                Continue to provide general corporate, intellectual
                     property, and legal management services commensurate with
                     past efforts..
--------------------------------------------------------------------------------
Human                Continue to provide general human resources commensurate
Resources            with past efforts. Assistance setting up all CMC benefit
                     plans.
--------------------------------------------------------------------------------
Finance              Continue to provide general finance services commensurate
                     with past efforts.
--------------------------------------------------------------------------------
Investor             Communication of CMC's strategy and performance to
Relations            investor community.
--------------------------------------------------------------------------------
Tax                  Continue to provide general tax services commensurate with
                     past efforts.
--------------------------------------------------------------------------------
Treasury             Provide advice on other treasury-related issues (FX mgmt,
                     leasing, letters of credit, investments/pension, bank
                     relationships). Put in place cash mgmt structure and
                     systems (collection & disbursements).  Open

                     bank accounts in the U.S. and abroad. Negotiate and put in
                     place credit agreements with banks.
--------------------------------------------------------------------------------
Controller           Cabot Corp. compliance reporting (government and SEC
                     filings, debt covenants). Accounting policies and
                     procedures, U.S. GAAP, and technical accounting guidance.
                     Ad hoc SEC reporting guidance. Coordination of Cabot & CMC
                     earnings release and SEC filings.
--------------------------------------------------------------------------------
Insurance            Management and allocation of corporate insurance to CMC,
                     including but not limited to, excess liability, general
                     liability, workers comp, fire & business interruption,
                     auto, and aircraft insurance premiums.
--------------------------------------------------------------------------------

Exhibit 10.5

The omitted portions indicated by brackets have been separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406, promulgated under the Securities Act of 1933, as amended.

FUMED METAL OXIDE SUPPLY AGREEMENT

This FUMED METAL OXIDE SUPPLY AGREEMENT (this "Agreement"), executed this 20th day of January, 2000, is between Cabot Corporation ("Cabot"), a Delaware corporation, and Cabot Microelectronics Corporation ("CMC"), a Delaware corporation. Notwithstanding the execution date hereof, this Agreement shall become effective upon the date of the initial public offering by CMC of shares of CMC common stock.

WHEREAS, Cabot and certain of its subsidiaries and CMC will be parties to a Master Separation Agreement, (the "Master Separation Agreement"), which will provide, in part, for the separation from Cabot, of the business, assets and liabilities of the Microelectronics Materials Division of Cabot (the "MMD Business") and the transfer of the MMD Business to CMC;

WHEREAS, in the past, the Microelectronics Materials Division of Cabot has purchased various fumed metal oxide products from Cabot;

WHEREAS, CMC desires to have Cabot provide to CMC certain fumed metal oxide products after the separation of the MMD Business; and

WHEREAS, Cabot desires to provide such fumed metal oxides to CMC after the separation of the MMD Business;

NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

SECTION 1. TERM

This Agreement shall commence on the date of the initial public offering by CMC of shares of CMC common stock, and shall continue until June 30, 2005 (the "Initial Term"). Unless either party shall give a notice of nonrenewal prior to December 31, 2003, this Agreement shall continue after the Initial Term until terminated by either party by a written notice of termination, which shall terminate this Agreement effective on the first June 30 or December 31 more than 18 months after the date such notice is delivered. The Initial Term, together with any continuations, are referred to herein as the "Term". Each year of the Term beginning on the effective date or an anniversary thereof is referred to herein as a "Term Year", including the stub period, if any, between the last anniversary of the effective date and the end of the Term.

SECTION 2. PRODUCTS

2.1 Purchase and Sale.

(a) Subject to the terms and conditions of this Agreement, during the Term, Cabot shall provide to CMC, and CMC shall purchase from Cabot, the Products (as defined below) in such quantities as specified by CMC, subject to Sections 2.3 through 2.5 below. "Products" means:

(i) the fumed silica of the types set forth on Schedule A hereto (the "Fumed Silica"), which shall conform to the specifications, formulae and processes set forth on Schedule A hereto; and

(ii) the fumed alumina of the types set forth on Schedule B hereto (the "Fumed Alumina" and together with the Fumed Silica, the "Fumed Metal Oxides"), which shall conform to the specifications, formulae and processes set forth on Schedule B hereto.

(b) Any amendment to Schedule A or Schedule B shall require the consent of both CMC and Cabot. Unless otherwise agreed to by Cabot, any increase in costs incurred by Cabot in manufacturing Products to comply with changes requested by CMC to the specifications as set forth on Schedule A or Schedule B shall be paid by CMC.

2.2 Forecasts.

CMC shall provide Cabot with forecasts (the "Forecasts") of the quantities of Fumed Metal Oxides that CMC expects to purchase from Cabot (the "Forecasted Quantities"). The Forecasts shall identify by grade, the Forecasted Quantities and the Cabot facility or facilities that will produce and deliver to CMC such Forecasted Quantities (including the volume to be made at each plant). CMC shall provide the following Forecasts to Cabot:

(a) not more than sixty (60) but not less than thirty (30) days prior to each January 1, April 1, July 1 and October 1 during the Term, a Forecast indicating the Forecasted Quantity for each month of the calendar quarter commencing on such January 1, April 1, July 1 and October 1 (the "Quarterly Forecast"); provided, however, that in such Quarterly Forecast, the Forecasted Quantity for any month may not exceed the Forecasted Quantity for the previous month by more than 20%;

(b) not more than sixty (60) but not less than thirty (30) days prior to each July 1 and January 1 during the Term, a semi-annual Forecast indicating the Forecasted Quantity for the six (6) month period commencing on such July 1 and January 1 (the "Six Month Forecast");

(c) not more than sixty (60) but not less than thirty (30) days prior to each July 1, a one (1) year Forecast indicating the Forecasted Quantity for the calendar year commencing on the following July 1 (the "Annual Forecast"); and

(d) on or around each July 1, an eighteen (18) month Forecast indicating the Forecasted Quantity for the eighteen month period commencing on the following July 1 (the "18 Month Forecast"); provided, however, that CMC shall provide Cabot with a revised eighteen (18) Month Forecast for the remainder of the eighteen (18) month period covered by the last 18 Month Forecast as soon reasonably practicable after CMC becomes aware of any material changes to such 18 Month Forecast.

For the purposes of this Agreement, Forecasts delivered by CMC to Cabot after the execution hereof shall, upon the effectiveness of this Agreement, be deemed to have been delivered hereunder.

With respect to planned shutdowns of Cabot's manufacturing facilities, the parties shall work together and cooperate with each other regarding necessary adjustments to forecasts and delivery schedules hereunder.

2.3 Cabot's Maximum Supply Obligations.

(a) The obligation of Cabot to supply Products to CMC under this Agreement shall be subject to each of the following maximum monthly volume limitations:

(i) the maximum monthly volume of Fumed Silica from Cabot's Tuscola, Illinois facility (the "Tuscola Plant") shall be [ ] pounds per month;

(ii)the maximum monthly volume of Fumed Alumina from Cabot's Tuscola, Illinois pilot facility (the "Tuscola Pilot Plant") shall be [ ] pounds per month; and

(iii) the maximum monthly volume of Fumed Silica from Cabot's Barry, Wales facility (the "Barry Plant") shall be [ ] pounds per month.

In clarification of the above, any volumes of Fumed Silica and/or Fumed Alumina supplied by Cabot under the Dispersions Services Agreement, of even date herewith, shall not be considered in calculating the maximum volumes of Fumed Silica and/or Fumed Alumina Cabot is obligated to supply hereunder.

(b) In addition to the volume limitations set forth in 2.3(a) above, in the event that CMC orders volumes of fumed silica from Cabot in excess of Forecasted Quantities, Cabot shall not be obligated to supply to CMC such Products in excess of the following volumes:

(i) for any calendar quarter and any plant, [ ]% of the volumes of Fumed Silica for such plant set forth in CMC's Quarterly Forecast;

(ii) for any calendar half year (beginning on or after July 1, 2000) and for any plant, [ ]% of the volumes of Fumed Silica for such plant set forth in CMC's Sixth Month Forecast; and

(iii) for any year beginning July 1 and for any plant, [ ]% of the volumes of Fumed Silica for such plant set forth in CMC's Annual Forecast.

(c) The maximum supply obligations set forth in Sections 2.3 (a) and (b) are referred to herein as the "Maximum Volumes". If CMC shall request volumes of Fumed Silica or Fumed Alumina in excess of the Maximum Volumes described above, Cabot shall use commercially reasonable efforts to supply such volumes ("Excess Volumes"); provided that Cabot shall not be obligated to breach its contractual obligations with other customers or to take any actions which it deems detrimental to its business, in order to supply CMC with Excess Volumes.

2.4 Minimum Volumes. CMC shall be obligated to purchase from Cabot during each six month period covered by a Six Month Forecast a "Minimum Volume," meaning at least 90% of the aggregate volumes of Fumed Silica forecasted to be purchased by CMC as set forth in each Six Month Forecast. Cabot and CMC recognize that damages for CMC's failure to purchase Minimum Volumes would be difficult to ascertain and prove. Cabot and CMC agree that if, during any six month period CMC fails to purchase from Cabot the Minimum Volume of Fumed Silica for such six month period, CMC shall pay to Cabot liquidated damages in an amount equal to the product obtained by multiplying (i) the difference (in pounds) between (x) the applicable Minimum Volume and (y) the amount of Fumed Silica actually purchased by CMC during the relevant six month period times (ii) $[ ]. Cabot and CMC agree that such liquidated damages are the sole and exclusive remedy for CMC's failure to purchase Minimum Volumes. Cabot and CMC further agree that such liquidated damages represent a reasonable estimate of Cabot's damages and do not constitute a penalty.

2.5 Exclusivity; Exception Thereto.

(a) CMC shall purchase from Cabot all of the Fumed Metal Oxides necessary to produce the products produced by CMC on the effective date of this Agreement. With respect to products developed and produced by CMC after the effective date of this Agreement, CMC shall not be obligated to purchase from Cabot any of the Fumed Metal Oxides necessary to produce such products.

(b) During the Term of this Agreement, Cabot shall not knowingly, without CMC's prior written consent, directly or indirectly, sell any Fumed Metal Oxides to any

person or entity other than CMC for use in the production of any goods or products that compete with any CMP (chemical mechanical polishing) consumable goods and products produced by CMC.

(c) In the event CMC requests a change to a Product specification, which change is necessary in order to achieve a material performance difference in CMC's end product, and Cabot is not able or is unwilling to modify such Product, CMC shall have the right to obtain such modified product from any third party, subject to any intellectual property rights Cabot may have.

(d) Notwithstanding Section 2.5(a) above, in the event that Cabot fails to supply CMC with its requirements for Products for any reason, CMC shall have the right to obtain such Products from any third party, subject to any intellectual property rights Cabot may have.

SECTION 3. PRICING

3.1 Prices. Cabot shall sell the Products to CMC in accordance with the following prices (the "Prices"):

(a) Fumed Silica Price.

The price for Fumed Silica shall be equal to the Base Price (as defined below) plus the Feedstock Adjustment (as defined below). The price of Fumed Silica to be purchased shall be determined by the date the order therefor is placed with Cabot, with respect to all volumes specified therein to be delivered within 90 days after the date such order is placed, and by the date specified for delivery, with respect to all volumes specified for delivery thereafter.

The "Base Price" shall be $[ ] per pound during the first Term Year. The Base Price shall increase by $[ ] per pound for each subsequent Term Year, to be effective commencing on the first day of each subsequent Term Year.

The "Feedstock Adjustment" shall be calculated and applied every six (6) months and is obtained by (i) calculating the difference between the New Feedstock Cost per pound of fumed silica manufactured (as defined below) and the Starting Feedstock Cost per pound of fumed silica manufactured (as defined below) and (ii) dividing this difference by a yield factor of [ ], provided that if the New Feedstock Cost is less than the Starting Feedstock Cost, the Feedstock Adjustment shall be zero. The Feedstock Adjustment shall be calculated and provided to CMC prior to each July1 and January 1 with respect to the following six (6) month period and shall be based on CMC's Six Month Forecast for such period as well as the historical feedstock cost information for the most recent six month period ended May 31 (in the case of the July 1 adjustment) and

November 30 (in the case of the January 1 adjustment).

The "New Feedstock Cost" shall be derived from the following formula:

New Feedstock Cost = [ ]

Where:

A = pounds of fumed silica forecasted to be purchased by CMC in the upcoming Six Month Forecast from the Tuscola plant. B = pounds of fumed silica forecasted to be purchased by CMC in the upcoming Six Month Forecast from the Barry plant. C = Total "Delivered Cost" of all [ ] (other than [ ] used in [ ] manufacturing) consumed in the manufacture of fumed silica at the Tuscola plant during the applicable six (6) month period divided by the total number of pounds of fumed silica produced at the Tuscola plant (other than [ ] which was toll manufactured), including off-quality material. As used herein, the "Delivered Cost" of [ ] means the purchase price paid by Cabot for such [ ], including transportation costs and applicable sales and use taxes as well as price adjustments related solely to the [ ], and excluding [ ] adjustments or credits and handling costs, labor and depreciation. D = Total "Delivered Cost" of all [ ] (other than [ ] used in
[ ] manufacturing) consumed in the manufacture of fumed silica at the Barry plant during the applicable six (6) month period divided by the total number of pounds of fumed silica produced at the Barry plant (other than [ ] which was toll manufactured), including off-quality material.

The "Starting Feedstock Cost" shall equal the total "Delivered Cost" of all [ ] (other than [ ] used in [ ] manufacturing) consumed at the Tuscola and Barry plant during the six (6) month period ended November 30, 1999 divided by the total number of pounds of fumed silica produced at the Tuscola and Barry plant (other than [ ] which was toll manufactured), including off-quality material, during such period.

CMC shall have the right to have a recognized accounting firm audit the books and records of Cabot necessary to verify the Feedstock Adjustment provided above. Such accounting firm shall be obligated to keep any information obtained during the audit of Cabot's books and records confidential and may confirm to CMC only

whether, and to what extent, Cabot's calculations of the Feedstock Adjustment deviate from the calculation of such accounting firm.

(b) Excess Volumes of Fumed Silica. The price for Excess Volumes of Fumed Silica shall be as follows:

(1) Subject to Section 2.3(c) above, if Cabot has the production capacity to produce the Excess Volumes of Fumed Silica at the times and in the volumes requested by CMC without interfering with its supply of products for other customers, Cabot shall produce such Excess Volumes and sell them to CMC at the prices set forth in Section 3.1(a) hereof.

(2) Subject to Section 2.3(c) above, if Cabot would be required to displace volumes intended for other customers, otherwise interfere with its supply of products to other customers or obtain Products from other sources in order to meet a request of CMC in respect of Excess Volumes of Fumed Silica, the price for such Excess Volumes shall be determined by Cabot, provided that such price shall not exceed [ ].

(c) Fumed Alumina Price.

Until Cabot shall begin commercial scale production of fumed alumina, the price for fumed alumina shall be equal to $[ ] per pound. For purposes of this agreement, "commercial scale production of fumed alumina" shall mean Cabot having a fumed alumina production unit capable of producing fumed alumina at a production rate greater than [ ] pounds per year. Upon commencement by Cabot of such commercial scale production of fumed alumina, Cabot and CMC shall renegotiate the price per pound of Fumed Alumina.

(d) In addition to the above described purchase prices for the fumed metal oxides, MMD shall reimburse Cabot for all reasonable costs incurred by Cabot in conducting analytical services requested by CMC for [ ].

3.2 Cost Savings. Cabot and CMC acknowledge that it is their intention to decrease the costs associated with manufacturing the Products, and to share any cost savings resulting from joint efforts equally between them (other than cost savings with respect to packaging, which the parties agree shall not be passed on to CMC). Cabot and CMC agree to discuss, from time to time, ways to jointly decrease such costs.

SECTION 4. ORDERS, SHIPPING, DELIVERY AND PAYMENT

(a) Orders for Products shall be issued by CMC from time to time. Each order shall specify the date(s) the products are to be delivered, which date(s) shall be not less than ten (10) business days prior to the date the order is received by Cabot. For purposes

of applying 2.3 and 2.4 only, each volume of Product shall be deemed to be in the month specified for its shipment in CMC's order; and if no date is specified, then in the month following the month in which the order therefor is issued by CMC.

(b) All sales of Products under this agreement are made F.O.B. Cabot's point of shipment. CMC shall be responsible for all transportation costs and title and risk of loss shall pass to CMC upon delivery to carrier.

(c) All Products shall be prepared by Cabot for delivery to CMC, as the case may be, including the necessary dunnage, to prevent damage during the normal course of transportation.

(d) Cabot shall invoice CMC for the Products delivered to CMC during each month by the fifteenth (15th) calendar day of the following month. Cabot shall deliver such invoices to CMC by regular U.S. mail, or other methods such as express U.S. mail, overnight courier or other means, if mutually acceptable.

(e) CMC shall pay each such invoice within fifteen (15) calendar days of receipt thereof. Such payment shall be made by check or wire transfer in readily available same day or next day funds denominated in United States dollars. If payment is to be made by wire transfer, CMC shall request and Cabot shall provide to CMC, wire transfer instructions.

SECTION 5. WARRANTIES

5.1 Warranty as to Products. Cabot represents and warrants to CMC that, when shipped to CMC, the Products will conform in all respects to the specifications then in effect and as then set forth in the materials specified on Schedule A and Schedule B hereto. CABOT MAKES NO OTHER REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AS TO MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER MATTER WITH RESPECT TO THE PRODUCTS, WHETHER USED ALONE OR IN COMBINATION WITH OTHER SUBSTANCES, EVEN IF THE PURPOSES OR USES OF SUCH PRODUCTS ARE KNOWN BY CABOT.

5.2 Remedies. If any Products do not conform in all respects to the specifications then in effect and as then set forth on Schedule A and Schedule B hereto, Cabot agrees to replace such Products with Products that conform to such specifications. Subject to the following sentence, CMC shall not be obligated to accept or pay for Products that do not conform to the specifications then in effect for such Products. If any such non-conformity is the result of materials, process specifications or formulae provided by CMC to Cabot, CMC shall pay Cabot for the Products and such volumes

shall be included in determining the volumes of Products delivered by Cabot to CMC hereunder. IN NO EVENT SHALL CABOT BE RESPONSIBLE OR LIABLE FOR ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING AS A RESULT OF ANY BREACH OF WARRANTY IN RESPECT OF ANY PRODUCTS UNDER THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

If to Cabot:            Cabot Corporation
                        Business and Technical Center
                        Billerica, MA 01821
                        Attn: Fumed Metal Oxide Product Line Manager
                        Telecopier:

                  With a copy to:

                        Cabot Corporation
                        75 State Street
                        Boston, MA 02109
                        Attn: Law Department
                        Telecopier: 617-342-6039



If to CMC:              Cabot Microelectronics Corporation
                        870 North Commons Drive
                        Aurora, IL 60504
                        Attn:  Vice President of Operations
                        Telecopier:  630-375-5596

or to such other address as may be designated in writing by any of the parties from time to time in accordance herewith.

SECTION 7. GENERAL

7.1 Severability. If any provision of this Agreement shall be found to be invalid or unenforceable, then such provision or provisions shall not invalidate or in any way affect the enforceability of the remainder of this Agreement and such provision or

provisions shall be curtailed and limited to the extent necessary to bring the Agreement within any legal requirement and the parties shall negotiate in good faith with respect to an equitable modification of the provision or application thereof held to be invalid.

7.2 Modification; Waivers. Except as expressly provided herein, this Agreement may be modified or amended only with the written consent of each party hereto. Neither party hereto shall be released from its obligations hereunder without the written consent of the other party. The observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) by the party entitled to enforce such term, but any such waiver shall be effective only if in a writing signed by the party against which such waiver is to be asserted. Except as otherwise specifically provided herein, no delay on the part of either party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of either party hereto of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

7.3 Succession. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and other legal representatives and, to the extent that any assignment hereof is permitted hereunder, their assignees.

7.4 Counterparts. This Agreement may be executed in counterparts.

7.5 Further Assurances. Each party agrees to provide any additional documents and take any such further action as may be reasonably requested by the other party in order to carry out the purpose and intent of this Agreement.

7.6 Entire Agreement. This Agreement contains the full and complete undertaking and agreement between the parties hereto with respect to the sale of fumed silica and fumed alumina by Cabot to CMC, and supersedes all other agreements between Cabot and CMC, whether written or oral, except any confidentiality agreements between the parties, which shall, to the extent such agreements do not contradict the terms of this Agreement, continue in effect.

7.7 Headings. The headings of the sections and other subdivisions of this Agreement are for convenient reference only. They shall not be used in any way to govern, limit, modify, construe this Agreement or any part or provision thereof nor otherwise be given any legal effect.

7.8 Assignees and Third Parties. This Agreement may not be assigned by either party without the prior written consent of the other party and any attempted

assignment without such consent shall be null and void; provided, however, that Cabot may assign this Agreement to a subsidiary or affiliated company. In addition, Cabot may make arrangements for the production and sale of Products required hereunder to be manufactured and sold by a subsidiary or an affiliate, including but not limited to Cabot Carbon Ltd. Such arrangements may take the form of an assignment of certain rights and obligations hereunder or a subcontract of certain obligations hereunder. Similarly, CMC may make arrangements for the purchase of Products hereunder to be made by a subsidiary, including but not limited to Cabot Microelectronics International Corporation. Such arrangements may take the form of an assignment of certain rights and obligations hereunder. However, all sales of Products pursuant to any such arrangement shall be governed by the terms of this Agreement.

7.9 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of Delaware, without giving effect to principles of conflicts or choice of laws of Delaware or of any other jurisdiction.

7.10 Force Majeure. Each of the parties hereto shall be excused from delays in performing or from failure to perform hereunder to the extent that such delays or failures result from causes beyond the reasonable control of such party, including, but not limited to, forces of nature, acts of God, strikes, lockouts, wars, blockades, insurrections, riots, epidemics, restraints or requirements of any government or government agency, civil disturbances, explosions, breakage or accident to machinery or lines of pipe, unavailability of raw material or supplies, strandings, perils of the sea, the binding order of any court or governmental authority which has been resisted in good faith by all reasonable means, and other cause, whether of the kind enumerated or otherwise, not reasonably within the control of the party claiming suspension. Failure to prevent or settle any strike shall not be considered to be a matter within the control of the party claiming suspension. However, in order to be excused from delay or failure to perform, such party must act diligently to remedy the cause of such delay or failure.

7.11 Confidentiality. Each of Cabot and CMC agree to keep confidential and not disclose, and shall cause their respective subsidiaries and affiliates to keep confidential and not disclose, to any party or use for any purpose (other than the performance of this Agreement), any proprietary or other confidential information of the other party which is received pursuant to this Agreement ("Confidential Information"). Confidential Information shall be subject to the restrictions of this paragraph only if it is marked as confidential or proprietary or, if not disclosed in tangible form, the disclosing party notifies the recipient of its confidential or proprietary nature prior to its disclosure. For purposes of this Agreement, Confidential Information of a party does not include, and a party and a party's subsidiaries and affiliates will have no obligations under this provision with respect to, any information of the other party or any subsidiary or affiliate of the other party (the other party and subsidiaries and affiliates of the other party being referred

to as the "receiving party") which:

(i) is already known to the receiving party from a source other than the disclosing party as evidenced by competent proof thereof; or

(ii) is or becomes publicly known through no wrongful act of the receiving party (in which event the receiving party's obligations under this Agreement in respect thereto shall terminate on the date such information enters the public domain); or

(iii) is rightfully received by the receiving party from a third party without violation of any obligations of confidentiality owed by the third party to the disclosing party; or

(iv) is disclosed by the disclosing party to a third party without restrictions on the third party's right to use or disclose such information; or

(v) is independently developed by employees or consultants of the receiving party without use of or reference to the disclosing party's Confidential Information; or

(vi) is approved for release by written authorization of the disclosing party

7.12 Independent Contractors. CMC and Cabot are each independent contractors. Nothing herein contained shall be construed to place CMC and Cabot in the relationship of principal and agent, master and servant, partners, or joint venturers, and, except as otherwise set forth in this Agreement, neither party shall have, expressly or by implication, the power to represent itself as having any authority to make contracts in the name of or binding upon the other, or to obligate or bind the other in any manner whatsoever.

7.13 Resale Prohibition. The parties intend and agree that the fumed silica and fumed alumina being sold hereunder to CMC is being sold solely for the use by CMC and its subsidiaries in manufacturing their products. Accordingly, CMC and its subsidiaries are prohibited from reselling any fumed silica or fumed alumina purchased hereunder. However, in the event CMC determines, in good faith, that the fumed metal oxides supplied hereunder, which otherwise meet the specification set forth in Scheduled A or B, but which are not fit for CMC's use in the manufacture of CMP slurries, CMC shall have the right to resell such fumed metal oxides, provided, CMC first offers Cabot the option to purchase such fumed metal oxides back from CMC at a price which is the lower of (i) the price paid by CMC to Cabot for such material, or (ii) the price at which CMC will resell such material.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as a sealed instrument and have delivered this Agreement as of the day and year first above written.

CABOT CORPORATION

By:    /s/  Samuel W. Bodman
   --------------------------------------
   Name:  Samuel W. Bodman
   Title: Chief Executive Officer

CABOT MICROLELECTRONICS CORPORATION

By:     /s/ Matthew Neville
   --------------------------------------
   Name:  Matthew Neville
   Title: President and
          Chief Executive Officer

Product                       Specification

[     ]                             [     ]

[     ]                             [     ]

[     ]                             [     ]

Schedule B

Fumed Alumina Specifications

Product Specification

[ ] [ ]

Exhibit 10.7
TRADEMARK LICENSE AGREEMENT

THIS AGREEMENT is made and effective as of this 28th day of March, 2000, by and between Cabot Corporation, a corporation organized and existing under the laws of the State of Delaware and having its corporate offices at 75 State Street, Boston, Massachusetts 02109 (hereinafter, "CABOT") and Cabot Microelectronics Corporation, a corporation organized and existing under the laws of the State of Delaware and having its corporate offices at 870 N. Commons Drive, Aurora 60504 (hereinafter, "CMC").

WHEREAS, CABOT is the owner, both at common law and through registrations and applications for registration therefor, of certain trademarks, service marks, trade names and associated goodwill (hereinafter, the "LICENSED TRADEMARK(s)"), as set forth on Schedule A attached hereto, and is engaged in the business of manufacturing, distributing and selling worldwide certain products including, but not limited to, the representative list of products also set forth on Schedule A (hereinafter "CABOT PRODUCT(s)").

WHEREAS, as a result of a mutually agreed to separation, CMC is the successor in interest to CABOT's worldwide microelectronics materials and polishing consumables business and is engaged in manufacturing, distributing and selling throughout the world certain related products ("CMC PRODUCT(s)"), as also set forth on Schedule A attached hereto.

WHEREAS, CMC desires to use and continue to use the LICENSED TRADEMARK(s) on or in connection with the CMC PRODUCT(s) and Cabot is willing to grant to CMC the right to use the LICENSED TRADEMARK(s) on or in connection with the CMC PRODUCT(s), such use subject to the terms and conditions of this Agreement.

NOW THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties, intending to be legally bound, hereto agree as follows:

ARTICLE 1 - GRANT OF LICENSE

1.1 CABOT hereby grants to CMC, and CMC hereby accepts, a non-exclusive, worldwide, royalty-free license to use the LICENSED TRADEMARK(s) solely on or in connection with the manufacture, use, sale, offer for sale, distribution or other disposition of the CMC PRODUCT(s), subject to the limitations set forth in this Agreement.

1.2 The grant of license in Section 1.1 above includes the right by CMC to grant sublicenses within the scope of such license to CMC's wholly-owned subsidiaries, but only for so long as each remains a wholly-owned subsidiary.

Trademark License Agreement - Page 1 of 10

1.3 The license granted herein includes the right to use the designation "CABOT" as a trade name, individually or in combination with other terms, subject to all the provisions hereof relating to the LICENSED TRADEMARK(s).

1.4 Except as provided in this Article, all licenses granted herein shall be nontransferable and nonassignable without the prior written consent of CABOT.

ARTICLE 2 - OWNERSHIP AND USE OF THE LICENSED TRADEMARKS

2.1 CMC acknowledges that CABOT owns the LICENSED TRADEMARK(s) and all rights therein and that nothing in this Agreement shall give CMC any right, title or interest in or to the LICENSED TRADEMARK(s). CMC further acknowledges and agrees that all use of the LICENSED TRADEMARK(s) by CMC shall inure to the benefit of CABOT.

2.2 CMC agrees that it will do nothing inconsistent with CABOT's ownership of the LICENSED TRADEMARK(s) and shall not claim adversely to CABOT, or assist any third party in attempting to claim adversely to CABOT, with regards to such ownership. CMC agrees that it will not challenge the title of CABOT to the LICENSED TRADEMARK(s), oppose any registration thereof, or challenge the validity of this Agreement or the licenses granted herein. Furthermore, CMC will not register, nor attempt to register, any trade name or trademark which, in whole or in part, incorporates or is confusingly similar to the LICENSED TRADEMARK(s).

2.3 Notwithstanding the license granted herein, CMC agrees not to use, display or adopt any style, design, color, font, form or logo similar to any past or then present style, design, color, form or logo of CABOT including, but not limited to, the styles illustrated on Schedule B.

2.4 Without the prior written approval of CABOT, CMC is not authorized to use the LICENSED TRADEMARK(s) in connection with any business activity unrelated to the CMC's microelectronics materials and polishing consumables business, as defined by the CMC PRODUCT(s).

2.5 Notwithstanding the license granted herein and any of the provisions hereof, no rights nor licenses are granted to CMC with respect to any other trademark, service mark, and/or trade name not listed on Schedule A hereto.

2.6 CMC agrees to assist CABOT in recording this Agreement with appropriate government authorities where such recording is required by law or regulation or where such recording is permitted or desired by CABOT.

2.7 All costs associated with recording this Agreement, the license granted herein and registering, maintaining, or renewing LICENSED TRADEMARK(S) exclusively used by CMC shall be borne by CMC. All costs associated with registering, maintaining or renewing any LICENSED TRADEMARK(S) also used by CABOT shall be borne by CABOT.

Trademark License Agreement - Page 2 of 10

ARTICLE 3 - QUALITY PROVISIONS

3.1 CMC agrees that the nature and quality of all CMC PRODUCT(s) sampled, sold, or otherwise disposed of and covered by the LICENSED TRADEMARK(s) shall conform to the standards set by and under the control of CABOT (hereinafter, "QUALITY STANDARD"). Such QUALITY STANDARD shall be reasonable, shall be no greater than the quality standards imposed by CMC's customers, and shall be at least equal in quality to the CMC PRODUCT(s) sold by CMC prior to the separation.

3.2 CMC shall, upon CABOT's reasonable request, supply samples of CMC PRODUCT(s) to CABOT. It shall not be necessary for CABOT to provide constant supervision of CMC's manufacture of the CMC PRODUCT(s). Alternatively, CABOT may request CMC to assure that the CMC PRODUCT(s) conform to the QUALITY STANDARD and, to this end, shall permit reasonable inspection during business hours by an authorized representative of CABOT of CMC's facilities to inspect the CMC's operations, methods of manufacture, materials used, storage and packing areas, and the like, associated with the manufacture of the CMC PRODUCT(s). Any inspections conducted by CABOT to ensure that the QUALITY STANDARD provided herein shall be at the expense of CABOT.

3.3 CMC shall deliver to CABOT, upon CABOT's request and without charge to CABOT, representative samples of labels, containers, advertisements, catalogs, letterhead, and the like, containing the LICENSED TRADEMARK(s) to enable CABOT to ensure that the LICENSED TRADEMARKS(s) are properly used.

3.4 CMC shall comply with all applicable laws and regulations, obtain all appropriate governmental or regulatory approvals pertaining to the sale, distribution and/or advertising of the CMC PRODUCT(s) and covered by the LICENSED TRADEMARK(s).

3.5 Any CMC PRODUCT(s) intended to be marketed under the LICENSED TRADEMARK(s) which fails to attain the QUALITY STANDARD shall, at the expense of CMC, be withdrawn from production and corrected or properly destroyed.

3.6 CABOT reserves the right to impose on CMC, as necessary, other specifications or requirements not provided for under this Article to maintain control over the CMC PRODUCT(s) to ensure the requisite QUALITY STANDARD.

ARTICLE 4 - DURATION OF LICENSE AND TERMINATION

4.1 This Agreement and the license granted herein shall be effective as of the effective date of this Agreement, and shall remain in effect until terminated in accordance with this Article 4.

Trademark License Agreement - Page 3 of 10

4.2 Should CMC ever discontinue the use of any LICENSED TRADEMARK(s) with the intent not to resume such use, CMC shall promptly notify CABOT of such action. As to any LICENSED TRADEMARK(s) with respect to which use is or has been discontinued without the intent to resume by CMC, CABOT may terminate the license with respect to such LICENSED TRADEMARK(s) upon three (3) month notice to CMC. CMC's intent not to resume use shall be established if any LICENSED TRADEMARK(s) is not used by CMC for a period of at least twelve (12) months.

4.3 CABOT shall have the right to terminate the license granted herein with respect to any LICENSED TRADEMARK(s) upon two (2) months prior written notice to CMC in the event that CMC breaches any provision of this Agreement, including but not limited to failure by CMC to comply with the QUALITY STANDARD established under Article 3, if such breach shall be continuing at the end of such two (2) month period.

4.4 CABOT shall have the right to terminate immediately this Agreement, or any or all licenses granted herein, upon written notice to CMC in the event of the winding-up, sale, insolvency, consolidation or merger where CMC or one of its wholly-owned subsidiaries is not the survivor, or any sequestration by governmental authority of CMC.

4.5 Upon the termination of this Agreement with respect to the LICENSED TRADEMARK(s), or the termination of all licenses under this Agreement, CMC agrees to immediately discontinue all use of such LICENSED TRADEMARK(s) and/or any similar trade name which contain "CABOT" as a part thereof, as the case may be. In this connection, CMC agrees:

(a) that it will immediately take all steps to refrain, as promptly as possible, from using the LICENSED TRADEMARK(s) as part of CMC's company name, and shall refrain from using the LICENSED TRADEMARK(s) in advertising, commercial registers, directories, internet and company web-sites, telephone listings, and all other similar listings.

(b) to use its best efforts and due diligence to obtain whatever approvals are necessary, either governmental or otherwise, to change its company name to exclude the LICENSED TRADEMARK(s) therefrom, such change to be effected within three(3) months after the termination of this Agreement.

ARTICLE 5 - PROTECTION

5.1 At the request of CMC, CABOT shall apply to register any unregistered LICENSED TRADEMARK(s) in any country in the name of CABOT for the CMC PRODUCT(s) provided herein, shall use its best efforts to obtain registrations thereof, shall maintain such registrations in full force and effect, and shall apply to register CMC as a registered user of the LICENSED TRADEMARK(s) in countries which require such registration. CMC shall cooperate with CABOT to obtain and maintain said registrations. The cost of obtaining and

Trademark License Agreement - Page 4 of 10

maintaining any unregistered LICENSED TRADEMARK(s) exclusively used by CMC shall be borne by CMC. The cost of obtaining and maintaining any unregistered LICENSED TRADEMARK(s) also used by CABOT shall be borne by CABOT. If CMC notifies CABOT that it is no longer interested in a trademark filed by CABOT under the provisions of this paragraph, CABOT shall be free to discontinue prosecution and/or maintenance of any application or registration for said LICENSED TRADEMARK(s), and CMC shall have no obligation for any expense with respect thereto incurred after the notice from CMC to CABOT.

5.2 In the event that registration is refused for any presently pending or subsequently filed application for registration of the LICENSED TRADEMARK(s), CABOT shall have the right to discontinue the prosecution thereof. Before discontinuing any such prosecution, CABOT shall give CMC one (1) months' notice and permit CMC, at CMC's expense, to take over prosecution thereof on CABOT's behalf.

5.3 If any opposition, cancellation, or similar proceeding is initiated by any third party with respect to the LICENSED TRADEMARK(s) or applications to register any LICENSED TRADEMARK(s), CABOT shall notify CMC of such proceeding, and CMC shall have one (1) month to notify CABOT if CMC wants such proceedings to be contested. If CMC informs CABOT that CMC wants to contest such proceeding, CABOT will defend such LICENSED TRADEMARK(s) in the proceeding or, at the option of CABOT, permit CMC to take over the defense of such proceeding on behalf of CABOT. CMC shall bear the expenses of such proceeding for the LICENSED TRADEMARK(s). If CMC does not notify CABOT that CMC wants such proceeding to be contested, CABOT shall have the right to proceed as it chooses with regard to such proceeding and such LICENSED TRADEMARK(s), including, without limitation, abandoning or cancelling such LICENSED TRADEMARK(s) or any application or registration therefor without any liability to CMC.

5.4 CMC shall promptly notify CABOT of any and all infringements, imitations, simulations or other illegal use or misuse of the LICENSED TRADEMARK(s) which come to CMC's attention. As the sole owner of the LICENSED TRADEMARK(s), CABOT shall determine whether to take any action to prevent the infringement, imitation, simulation or other illegal use or misuse of the LICENSED TRADEMARK(s). If CABOT elects not to take such action, CMC shall have the right to take such action at CMC's expense. In this event, CABOT shall, at CMC's expense, cooperate in such action with CMC including, without limitation, joining as a party. Any money recovered by way of damages or otherwise with respect to such action shall be kept by the party which bore the costs of such action; or, in any case where the parties have shared the costs, such money shall be shared in proportion to the costs borne by each party.

5.5 CMC shall render CABOT all reasonable assistance in connection with any matter pertaining to the protection, enforcement or infringement of LICENSED TRADEMARK(s) used by CMC, whether in the courts, administrative or quasi-judicial agencies, or otherwise.

ARTICLE 6 - NEW TRADEMARKS

Trademark License Agreement - Page 5 of 10

6.1 Should CMC desire to develop new trademarks using the prefix "CABOT" on the CMC PRODUCT(s), it must first consult with and obtain the written approval of CABOT, which approval will not be unreasonably withheld. Such newly developed trademarks will be registered in the name of CABOT, and will be deemed to be LICENSED TRADEMARK(s) licensed to CMC hereunder and will be subject to all of the terms and conditions of this Agreement. Such approval will not be contingent upon the payment of any fee or royalties to CABOT, however the cost of obtaining and maintaining such new trademarks shall be borne solely by CMC.

Trademark License Agreement -- Page 6 of 10

ARTICLE 7 - INDEMNIFICATION

7.1 CMC agrees to indemnify and hold harmless CABOT and its directors, officers and employees from any and all claims for damage or injury to persons or property or for loss of life or limb whereby CABOT has been found liable to any third party under any product liability, tort liability or similar action arising out of or in connection with the use by CMC of the LICENSED TRADEMARK(s).

7.2 For purposes of indemnification, CMC shall purchase an insurance policy covering at a minimum product and tort liability with a face value of ten million dollars ($10,000,000), such policy naming CABOT as co-insured. CMC shall pay any and all premiums of such policy on a timely basis, receipt of which shall be furnished to CABOT.

ARTICLE 8 - MISCELLANEOUS

8.1 Entire Agreement. This Agreement contains the entire agreement of the parties regarding the subject matter hereof and supersedes all prior agreements, understandings and negotiations, whether written or oral, regarding the same. This Agreement may not be changed, modified, amended or supplemented except by a written instrument signed by both parties. Furthermore, it is the intention of the parties that this Agreement be controlling over additional, different or ambiguous terms of any separation agreement, asset transfer agreement or any similar document, even if accepted in writing by both parties.

8.2 Assignability. This Agreement may not be assigned nor transferred by CMC without the prior consent of CABOT.

8.3 Extension of Rights. All rights and obligations incurred hereunder by CABOT or CMC shall extend to and be binding upon their respective domestic and international divisions, subsidiaries, other controlled companies, affiliates and related entities.

8.4 Waiver. The waiver by CABOT of a breach of any provision contained herein shall be in writing and shall no way be construed as a waiver of any subsequent breach of such provision or the waiver of the provision itself.

8.5 Injunctive Relief. CMC acknowledges that monetary relief would not be an adequate remedy for a breach or threatened breach by CMC of the provisions of this Agreement and that CABOT shall be entitled to the enforcement of this Agreement by injunction, specific performance or other equitable relief, without prejudice to any other rights and remedies that CABOT may have.

8.6 Disclaimer of Agency, Partnership and Joint Venture. Nothing herein shall be deemed to create an agency, distributorship, joint venture or partnership relationship between the parties hereto.

Trademark License Agreement - Page 7 of 10

8.7 Severability. If any provision of this Agreement shall be held illegal or unenforceable, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect and enforceable.

8.8 Notice and Reports. All notices, consents or approvals required by this Agreement shall be in writing sent by certified, registered, or Express Mail service, postage prepaid or by facsimile (confirmed by such certified, registered, Express Mail or other overnight courier service) to the parties at the following addresses or such other addresses as may be designated in writing by the respective parties:

if to CABOT, to:

Cabot Corporation
75 State Street
Boston, Massachusetts 02109
Attn: General Counsel

with copies to:

Cabot Corporation Law Department 157 Concord Road Billerica, Massachusetts 01821 Attn: Chief Intellectual Property Counsel

if to CMC to:

Cabot Microelectronics Materials Corporation 870 N. Commons Drive Aurora, Illinois 60504 Attn: General Counsel

with copy to:

Cabot Microelectronics Materials Corporation 870 N. Commons Drive Aurora, Illinois 60504 Attn: President

Notices shall be deemed effective on the date of mailing.

8.9 Jurisdiction. This Agreement shall be binding in every jurisdiction worldwide.

8.10 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without regard to conflict of laws principles.

Trademark License Agreement - Page 8 of 10

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized officers or agents as of the day and year first above written.

CABOT CORPORATION CABOT MICROELECTRONICS

CORPORATION

By:      /s/ Samuel W. Bodman               By:      /s/ Matthew Neville
Name:     Samuel W. Bodman                  Name:    Matthew Neville
Title:   Chairman and CEO                   Title:   President and CEO
Date:    March 28, 2000                     Date:    March 28, 2000

CABOT                              with or without a logo or design,
                                   block letters or stylized, as such
                                   may be used as a trademark, service
                                   mark or trade name, individually or
                                   in combination with other names or
                                   marks of CABOT.

CABOT & DEVICE                     with or without a logo or design,
                                   block letters or stylized, as such
                                   may be used as a trademark, service
                                   mark or trade name, individually or
                                   in combination with other names or
                                   marks of CABOT, as depicted in U.S.
                                   Reg. Nos. 613,329, 615,516, 615,689,
                                   1,619,285, 1,827,952, and 1,833,580.

CAB AND CABO                       formatives and derivatives, with or
                                   without a logo or design, block
                                   letters or stylized, as such may be
                                   used in combination with one or more
                                   prefixes, suffixes or combinations
                                   thereof.

CABOT
MICROELECTRONICS                   with or without a logo or design,
                                   block letters or stylized, as such
                                   may be used as a trademark, service
                                   mark or trade name, individually or
                                   in combination with other names or
                                   marks of CABOT.

CAB-O-SPERSE                       with or without a logo or design,
                                   block letters or stylized, as such
                                   may be used as a trademark, service
                                   mark or trade name, individually or
                                   in combination with other names or
                                   marks of CABOT.

CABOT PRODUCTS

Including, but not limited to, carbon black; metal, metalloid oxides and alloys thereof such as silica, alumina, tantalum, niobium, cesium, rubidium, tellurium, germanium and the like; cesium formate and related drilling fluids; barium titanate; masterbatches and granulated concentrates for use in such masterbatches; plastics; liquified natural gas; coal; and any articles, applications, or dispersions formed from any of the above, whether in a finished or unfinished state for use in numerous end product applications.

CMC PRODUCTS

CMC PRODUCTS means polishing consumables for use in the semiconductor, electronic, rigid disk and magnetic head industries, such as polishing slurries, polishing pads, cleaning compositions, precursor compositions, and related consumables.

Trademark License Agreement - Page 9 of 10

SCHEDULE B

[CABOT]

[Cabot logo, CABOT]

[Cabot logo, CABOT, creating what matters]

Trademark License Agreement - Page 10 of 10

Exhibit 10.8

The omitted portions indicated by brackets have been separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406, promulgated under the Securities Act of 1933, as amended.

DISPERSION SERVICES AGREEMENT

This DISPERSION SERVICES AGREEMENT (the "Agreement"), executed this 20th day of January, 2000, is between Cabot Corporation ("Cabot"), a Delaware corporation, and Cabot Microelectronics Corporation ("CMC"), a Delaware corporation. Notwithstanding the execution date hereof, this Agreement shall become effective upon the date of the initial public offering by CMC of shares of CMC common stock.

WHEREAS, Cabot and certain of its subsidiaries and CMC will be parties to a Master Separation Agreement, (the "Master Separation Agreement"), which will provide for the separation from Cabot of the business, assets and liabilities of Microelectronics Materials Division of Cabot (the "MMD Business") and the transfer of the MMD Business to CMC;

WHEREAS, in the past, the Microelectronics Materials Division of Cabot has performed various dispersion services for Cabot;

WHEREAS, Cabot desires to have CMC provide to Cabot certain dispersion services after the separation of the MMD Business; and

WHEREAS, CMC desires to provide such dispersion services to Cabot as provided herein;

NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

SECTION 1. TERM

This Agreement shall commence on the date of the initial public offering by CMC of shares of CMC common stock, and shall continue until June 30, 2005 (the "Initial Term"). Unless either party shall give a notice of nonrenewal prior to December 31, 2003, this Agreement shall continue after the Initial Term until terminated by either party by a written notice of termination, which shall terminate this Agreement effective on the first June 30 or December 31 more than 18 months after the date such notice is delivered. The Initial Term, together with any continuations, are referred to herein as the "Term". Each year of the Term beginning on the effective date or an anniversary thereof is referred to herein as a "Term Year", including the stub period, if any, between the last anniversary of the effective date and the end of the Term.

SECTION 2. SERVICES

2.1 Purchase and Sale.

(a) Subject to the terms and conditions of this Agreement, during the Term, CMC shall provide to Cabot, and Cabot shall purchase from CMC, the Services (as defined below) in such quantities as specified by Cabot, subject to Sections 2.3 through 2.6 below. "Services" means:

(i) the manufacturing and packaging of the type of dispersions set forth on Schedule A hereto (the "Products") in accordance with the specifications, formulae and processes provided by Cabot to CMC and initially as set forth in the materials specified on Schedule A hereto;

(ii) the packaging of the Products in accordance with specifications set forth on Schedule A, which may be amended from time to time, by mutual agreement; and

(iii) testing and other ancillary services as related thereto as may be mutually agreed between Cabot and CMC from time to time.

(b) Any amendment to Schedule A shall require the consent of both CMC and Cabot. Any increase in costs incurred by CMC in manufacturing and/or packaging Products to comply with changes requested by Cabot to the specifications as set forth on Schedule A shall be paid by Cabot.

(c) With respect to Products to be sold to customers of Cabot and/or its subsidiaries which are located in the United States, Canada or Mexico (collectively "North America"), Services shall be performed either by (i) CMC at its facility in Aurora, Illinois (the "Aurora Plant"), or (ii) Davies Imperial Coatings ("Davies"), pursuant to an agreement between CMC and Davies (the "Davies Agreement"); provided that CMC shall continue to remain primarily liable to Cabot for any Services provided by Davies. Cabot and CMC shall confer in good faith in order to determine whether Services will be provided by the Aurora Plant or Davies.

(d) With respect to Products to be sold to customers of Cabot and/or its subsidiaries located in Europe, Services shall be performed at the dispersions facility of CMC in Barry, Wales (the "Barry Plant").

(e) With respect to Products to be sold to customers of Cabot and/or its subsidiaries located in regions other than North America or Europe, CMC shall determine

the appropriate facility to perform such Services after review of its regional capacity and capabilities and after consultation with Cabot.

(f) Notwithstanding anything to the contrary in subsections (c) and (d) above, and subject to 2.3(a)(i), Cabot may specify Products to be manufactured at the Aurora Plant, regardless of the ultimate geographic market for such Products, provided that such Products would not be incompatible with the dispersions manufacturing capabilities at the Aurora Plant or that such Products would not create contamination issues with respect to the products CMC manufactures at its Aurora Plant.

2.2 Forecasts.

Cabot shall provide CMC with forecasts (the "Forecasts") of the quantities of Products that Cabot expects to purchase from CMC (the "Forecasted Quantities"). The Forecasts shall identify the Forecasted Quantities of the Products and the geographic locations for manufacture (i.e., the Aurora Plant, Davies or the Barry Plant). Cabot shall provide the following Forecasts to CMC:

(a) not more than sixty (60) but not less than thirty (30) days prior to each January 1, April 1, July 1 and October 1 during the Term, a Forecast indicating the Forecasted Quantity for each month of the calendar quarter commencing on such January 1, April 1, July 1 and October 1 (the "Quarterly Forecast");

(b) not more than sixty (60) but not less than thirty (30) days prior to on each July 1 and January 1 during the Term, a semi-annual Forecast indicating the Forecasted Quantity for the six (6) month period commencing on such July 1 and January 1 (the "Six Month Forecast");

(c) not more than sixty (60) but not less than thirty (30) days prior to on each July 1, a one (1) year Forecast indicating the Forecasted Quantity for the calendar year commencing on the following July 1 (the "Annual Forecast"); and

(d) on or around each July 1, an eighteen (18) month Forecast indicating the Forecasted Quantity for the eighteen month period commencing on the July 1 (the "18 Month Forecast"); provided, however, that Cabot shall provide CMC with a revised eighteen (18) Month Forecast for the remainder of the eighteen (18) month period covered by the last 18 Month Forecast as soon reasonably practicable after Cabot becomes aware of any material changes to such 18 Month Forecast.

For the purposes of this Agreement, Forecasts delivered by Cabot to CMC after the execution hereof shall, upon the effectiveness of this Agreement, be deemed to have been delivered hereunder.

2.3 CMC's Maximum Supply Obligations.

(a) The obligation of CMC to provide Products to Cabot shall be subject to each of the following maximum monthly volume limitations:

(i) the maximum monthly volume of Products from CMC's Aurora, Illinois facility (the "Aurora Plant") shall be [ ] gallons per month;

(ii) the maximum monthly volume of Products from Davies' Hammond, Indiana facility (the "Hammond Plant") shall be [ ] gallons per month; and

(iii) the maximum monthly volume of Products from the Barry Plant shall be
[ ] gallons per month.

(b) In addition to the volume limitations set forth in 2.3(a) above, in the event that Cabot orders volumes of Products from CMC in excess of Forecasted Quantities, CMC shall not be obligated to supply to Cabot such Products in excess of the following volumes:

(i) for any calendar quarter and any plant, [ ]% of the volumes for such plant set forth in Cabot's Quarterly Forecasts;

(ii) for any calendar half year (beginning on or after July 1, 2000) and any plant, [ ]% of the volumes for such plant set forth in Cabot's Sixth Month Forecast; and

(iii) for any year beginning July 1 and any plant, [ ]% of the volumes for such plant set forth in Cabot's Annual Forecast.

(c) The maximum supply volumes set forth in Sections 2.3 (a) and (b) are referred to herein as the "Maximum Volumes". If Cabot shall order volumes of Products in excess of the Maximum Volumes described above, CMC shall use commercially reasonable efforts to supply such volumes ("Excess Volumes").

(d) Notwithstanding anything to the contrary in subsections (a) or (b) above, if CMC shall increase its production capacity at its current dispersions plants or at newly acquired or constructed dispersions plants, Cabot and CMC shall negotiate in good faith regarding additional dispersions capacity that may be available to Cabot and the price for dispersions services related to such additional capacity.

2.4 Minimum Order Volumes.

Cabot agrees to order Products from CMC subject to the minimum batch size requirements set forth on Schedule A hereto.

2.5 Exclusivity.

(a) Except in connection with its [ ] businesses, and subject to other existing obligations, during the Term Cabot will not contract with any third party (other than Cabot affiliates, CMC, CMIC or Davies) for the provision of contract or toll manufacturing services for the production of fumed metal oxide dispersions.

(b) Notwithstanding subsection (a) above or subsection (c) below:

(i) Cabot shall have right the during the Term to produce fumed metal oxide dispersions for sale, its own use or the sale or use of its subsidiaries;

(ii) if CMC or Davies is unable or unwilling to supply certain products or volumes in accordance with the terms hereof, or above the Maximum Volumes set forth in Section 2.3 hereof, Cabot shall have the right to have such products or additional volumes of dispersions manufactured for it by other parties;

(iii) In the event Cabot requests a change to the specifications, formulae or processes set forth on Schedule A, which change is necessary in order to achieve a material performance difference in Cabot's end product, and CMC is not able or is unwilling to modify such Product, Cabot shall have the right to have such changed products manufactured for it by any other party; and

(iv) Cabot shall have the right to contract for and purchase from third parties fumed metal oxide dispersions that are produced with fumed metal oxides that are not supplied by Cabot.

(c) If Cabot terminates this Agreement, Cabot shall, for a period of [ ] following the date of such termination purchase fumed metal oxide dispersions products and services only from CMC, Davies or third parties who are not engaged in the production and/or marketing of CMP (chemical mechanical polishing) consumables.

(d) During the Term of this Agreement, CMC shall not knowingly, without Cabot's prior written consent, directly or indirectly, (i) perform dispersions services for any person or entity other than Cabot for use in the production of any goods or products that compete with any Cabot products, or (ii) sell fumed metal oxide dispersions products into applications, other than CMP applications, which compete with any Cabot product.

2.6 Supply of Raw Materials

Cabot shall be responsible for the supply to CMC of the fumed metal oxide particles necessary for the manufacture of the Products ordered by Cabot. Any such volumes of fumed metal oxides shall not be deemed supplied pursuant to the Fumed Metal Oxide Supply Agreement, of even date herewith. CMC shall be responsible for the supply of all other materials necessary for the manufacture of the Products, including packaging materials.

SECTION 3. PRICING

3.1 Prices. CMC shall perform the Services and sell the Products in accordance with the following prices (the "Prices"):

(a) with respect to Products manufactured and the services performed by CMC, the price shall equal the "Dispersion Manufacturing Cost" incurred by CMC plus [ ]% of such Dispersion Manufacturing Cost. As used herein, the "Dispersion Manufacturing Cost" of fumed metal oxide dispersions shall mean, all costs that may be included in [ ]. CMC's [ ] may be used for calculating such Dispersion Manufacturing Cost, provided that both parties mutually agree that it fairly approximates the above stated Dispersion Manufacturing Cost, and that both parties mutually agree upon a method to make adjustments due to variances between the [ ] and the actual Dispersion Manufacturing Cost.

(b) with respect to Products manufactured and the services performed by Davies, the price shall equal the Dispersion Manufacturing Cost incurred by CMC (excluding the costs of the fumed metal oxide particle supplied by Cabot) plus [ ]% of such costs as an administrative charge.

Cabot shall have the right to have a recognized accounting firm audit the books and records of CMC necessary to verify the Dispersions Manufacturing Cost provided above. Such accounting firm shall be obligated to keep any information obtained during the audit of CMC's books and records confidential and may confirm to Cabot only whether, and to what extent, CMC's calculations of the Dispersions Manufacturing Cost deviate from the calculation of such accounting firm.

3.2 Cost Savings. Cabot and CMC acknowledge that it is their intention to decrease the costs associated with manufacturing the Products, and to share any cost savings resulting from joint efforts therefrom equally between them. Cabot and CMC agree to discuss, from time to time, ways to jointly decrease such costs.

SECTION 4. SHIPPING, DELIVERY AND PAYMENT

(a) Orders for Products shall be issued by Cabot from time to time. Each order shall specify the date(s) the Products are to be delivered, which date(s) shall be not less than ten (10) business days prior to the date the order is received by CMC. For purposes of applying Section 2.3 only, each volume of Product shall be deemed to be in the month specified for its shipment in Cabot's order; and if no date is specified, then in the month following the month in which the order therefor is issued by Cabot.

(b) All sales of Products under this agreement are made F.O.B. CMC's point of shipment. Cabot shall be responsible for all transportation costs and title and risk of loss shall pass to Cabot upon delivery to carrier.

(c) All Products shall be prepared by CMC for delivery to Cabot in accordance with Cabot's reasonable instructions to be supplied by Cabot to CMC as far in advance of, and not later than ten (10) business days prior to, a requested shipment date.

(d) CMC shall invoice Cabot for the Products delivered to Cabot during each month by the fifteenth (15th) calendar day of the following month. CMC shall deliver such invoices to Cabot by regular U.S. mail, or other methods such as express U.S. mail, overnight courier or other means, if mutually acceptable.

(e) Cabot shall pay each such invoice within fifteen (15) calendar days of receipt thereof. Such payment shall be made by check or wire transfer in readily available same day or next day funds denominated in United States dollars. If payment is to be made by wire transfer, Cabot shall request and CMC shall provide to Cabot, wire transfer instructions.

SECTION 5. WARRANTIES

5.1 Warranty as to Products. CMC represents and warrants to Cabot that, when delivered to Cabot, the Products and Services will conform in all respects to the specifications then in effect and as then set forth in the materials specified on Schedule A hereto. CMC MAKES NO OTHER REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AS TO MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER MATTER WITH RESPECT TO THE PRODUCTS OR SERVICES, WHETHER USED ALONE OR IN COMBINATION WITH OTHER SUBSTANCES, EVEN IF THE PURPOSES OR USES OF SUCH PRODUCTS ARE KNOWN BY CMC.

5.2 Remedies. If any Products do not conform in all respects to the specifications then in effect and as then set forth on Schedule A hereto, CMC agrees to replace such Products with Products that conform to such specifications. Subject to the

following sentence, Cabot shall not be obligated to accept or pay for Products not conforming to the specifications then in effect for such Products. If such non-conformity is the result of materials or formulae provided by Cabot to CMC, Cabot shall pay CMC for the Services and such volumes shall be included in determining the volumes of Products delivered by CMC to Cabot hereunder. In no event shall CMC be responsible or liable for any special, incidental or consequential damages arising as a result of any breach of warranty in respect of any PRODUCTS OR Services under this Agreement or the transactions contemplated hereby.

SECTION 6. RELATIONSHIP OF PARTIES

(a) CMC and Cabot are each independent contractors. Nothing herein contained shall be construed to place CMC and Cabot in the relationship of principal and agent, master and servant, partners, or joint venturers, and, except as otherwise set forth in this Agreement, neither party shall have, expressly or by implication, the power to represent itself as having any authority to make contracts in the name of or binding upon the other, or to obligate or bind the other in any manner whatsoever.

(b) Cabot recognizes and agrees that certain dispersions services shall be performed on CMC's behalf by Davies. However, such services by Davies shall be considered to have been subcontracted by CMC to Davies, and ultimate responsibility for the performance of such services shall remain with CMC. Cabot shall have no direct contractual relationship with Davies with respect to dispersion services obtained by CMC pursuant to this Agreement.

SECTION 7. INTELLECTUAL PROPERTY AND CONFIDENTIALITTY

(a) Any intellectual property relating to the process engineering or method of production of dispersions ("Dispersions Intellectual Property") developed by CMC or CMIC principally in the course of performing Services for Cabot hereunder shall be jointly owned by Cabot and either CMC or CMIC, as the case may be. Notwithstanding the above, Cabot shall not sublicense or assign such intellectual property to any party (other than a subsidiary or affiliate of Cabot) for use in the production and/or sale of CMP consumables. Similarly, CMC shall not sublicense or assign such intellectual property to any party (other than a subsidiary or affiliate of CMC) for use in the production and/or sale of products for use in non-CMP applications.

(b) CMC or CMIC shall, upon the request of Cabot, grant a non-exclusive license to Cabot, in exchange for a commercially reasonable royalty payment from Cabot to CMC or CMIC, as the case may be, to be mutually agreed between the appropriate parties, any Dispersions Intellectual Property developed by CMC or CMIC other than in the performance of Services but which is used by CMC or CMIC in the production of

Products. Notwithstanding the above, Cabot shall not sublicense or assign such intellectual property to any party (other than a subsidiary or affiliate of Cabot) for use in the production and/or sale of CMP consumables.

(c) CMC and CMIC shall use their commercially reasonable best efforts, including by seeking to have included in the Davies Agreement appropriate provisions, to have Davies bound by the provisions of subsections (a) and (b) above to the same extent as CMC and CMIC.

(d) Each of Cabot and CMC agree to keep confidential and not disclose, and shall cause their respective subsidiaries and affiliates to keep confidential and not disclose, to any party or use for any purpose (other than the performance of this Agreement), any proprietary or other confidential information of the other party which is received pursuant to this Agreement ("Confidential Information"). Confidential Information shall be subject to the restrictions of this paragraph only if it is marked as confidential or proprietary or, if not disclosed in tangible form, the disclosing party notifies the recipient of its confidential or proprietary nature prior to its disclosure. For purposes of this Agreement, Confidential Information of a party does not include, and a party and a party's subsidiaries and affiliates will have no obligations under this provision with respect to, any information of the other party or any subsidiary or affiliate of the other party (the other party and subsidiaries and affiliates of the other party being referred to as the "receiving party") which:

(i) is already known to the receiving party from a source other than the disclosing party as evidenced by competent proof thereof; or

(ii) is or becomes publicly known through no wrongful act of the receiving party (in which event the receiving party's obligations under this Agreement in respect thereto shall terminate on the date such information enters the public domain); or

(iii) is rightfully received by the receiving party from a third party without violation of any obligations of confidentiality owed by the third party to the disclosing party; or

(iv) is disclosed by the disclosing party to a third party without restrictions on the third party's right to use or disclose such information; or

(v) is independently developed by employees or consultants of the receiving party without use of or reference to the disclosing party's Confidential Information; or

(vi) is approved for release by written authorization of the disclosing party

SECTION 8. CONSENTS; NOTICES

Unless otherwise set forth herein, whenever any notice, consent or approval is to be given in this Agreement, it must be in writing and delivered in accordance with the

provisions of this Section 8. Any such writing will be duly given upon delivery, if delivered by hand, facsimile transmission or mail, to the following addresses:

If to Cabot:            Cabot Corporation
                        Business and Technical Center
                        Billerica, MA  01821
                        Attn: Fumed Metal Oxide Product Line Manager
                        Telecopier:

                  With a copy to:

                        Cabot Corporation
                        75 State Street
                        Boston, MA  02109
                        Attn: Law Department
                        Telecopier:  617-342-6039



If to CMC:              Cabot Microelectronics Corporation
                        870 North Commons Drive
                        Aurora, IL  60504
                        Attn:  Global Manufacturing Manager
                        Telecopier:  630-375-5596

or to such other address as may be designated in writing by any of the parties from time to time in accordance herewith.

SECTION 9. GENERAL

9.1 Severability. If any provision of this Agreement shall be found to be invalid or unenforceable, then such provision or provisions shall not invalidate or in any way affect the enforceability of the remainder of this Agreement and such provision or provisions shall be curtailed and limited to the extent necessary to bring the Agreement within any legal requirement and the parties shall negotiate in good faith with respect to an equitable modification of the provision or application thereof held to be invalid.

9.2 Modification; Waivers. Except as expressly provided herein, this Agreement may be modified or amended only with the written consent of each party hereto. Neither party hereto shall be released from its obligations hereunder without the written consent of the other party. The observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) by the party entitled to enforce such term, but any such waiver shall be

effective only if in a writing signed by the party against which such waiver is to be asserted. Except as otherwise specifically provided herein, no delay on the part of either party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of either party hereto of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

9.3 Succession. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and other legal representatives and, to the extent that any assignment hereof is permitted hereunder, their assignees.

9.4 Counterparts. This Agreement may be executed in counterparts.

9.5 Further Assurances. Each party agrees to provide any additional documents and take any such further action as may be reasonably requested by the other party in order to carry out the purpose and intent of this Agreement.

9.6 Entire Agreement. This Agreement contains the full and complete undertaking and agreement between the parties hereto with respect to the manufacture and supply of fumed metal oxide dispersions, and supersedes all other agreements between Cabot, on the one hand, and CMC, on the other, whether written or oral except any confidentiality agreements between the parties, which shall, to the extent such agreements do not contradict the terms of this Agreement, continue in effect.

9.7 Headings. The headings of the sections and other subdivisions of this Agreement are for convenient reference only. They shall not be used in any way to govern, limit, modify, construe this Agreement or any part or provision thereof nor otherwise be given any legal effect.

9.8 Assignees and Third Parties. This Agreement may not be assigned by either party without the prior written consent of the other party and any attempted assignment without such consent shall be null and void; provided, however, that Cabot may assign this Agreement to a subsidiary or affiliated company. In addition, CMC may make arrangements for the production and sale of Services and Products required hereunder to be manufactured and sold by a subsidiary or an affiliate, including but not limited to Cabot Microelectronics International Corporation. Such arrangements may take the form of an assignment of certain rights and obligations hereunder or a subcontract of certain obligations hereunder. Similarly, Cabot may make arrangements for the purchase of Products and Services hereunder to be made by a subsidiary, including but not limited to Cabot Carbon Ltd. Such arrangements may take the form of an assignment of certain

rights and obligations hereunder. However, all sales of Products and Services pursuant to any such arrangement shall be governed by the terms of this Agreement.

9.9 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of Delaware, without giving effect to principles of conflicts or choice of laws of Delaware or of any other jurisdiction.

9.10 Force Majeure. Each of the parties hereto shall be excused from delays in performing or from failure to perform hereunder to the extent that such delays or failures result from causes beyond the reasonable control of such party, including, but not limited to, forces of nature, acts of God, strikes, lockouts, wars, blockades, insurrections, riots, epidemics, restraints or requirements of any government or government agency, civil disturbances, explosions, breakage or accident to machinery or lines of pipe, unavailability of raw material or supplies, strandings, perils of the sea, the binding order of any court or governmental authority which has been resisted in good faith by all reasonable means, and other cause, whether of the kind enumerated or otherwise, not reasonably within the control of the party claiming suspension. Failure to prevent or settle any strike shall not be considered to be a matter within the control of the party claiming suspension. However, in order to be excused from delay or failure to perform, such party must act diligently to remedy the cause of such delay or failure.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as a sealed instrument and have delivered this Agreement as of the day and year first above written.

CABOT CORPORATION

By: /s/  Samuel W. Bodman
   ------------------------------------
    Name:  Samuel W. Bodman
    Title: Chief Executive Officer

CABOT MICROLELECTRONICS
CORPORATION

By: /s/ Matthew Neville
   ------------------------------------
   Name:  Matthew Neville
   Title: President and
          Chief Executive Officer

PRODUCT       FORMULA       CONTROL PLAN         SPECIFICATION              CMC TEST          STANDARD      MINIMUM
             (REVISION       (EFFECTIVE       (SPECIFICATION NO./            METHODS           PACKAGE       ORDER
               DATE)        DATE/REVISION        REVISION DATE)           (TEST METHOD                     QUANTITY
                               LEVEL)                                       NUMBER)
  [ ]         9/19/96      8-5-96, Rev. A       [ ] -10/98-Rev.        101, 200, 300, 302     55 G Poly     8 Drums
                                                    1-10/98                                     Drum
  [ ]         1/19/00      5-1-97, Rev. A        [ ] -1/0-Rev.           203, 6010A (1)      275 G Rock     2 Totes
                                                     3-1/00                                     Tote
  [ ]          5/4/95      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     8 Drums
                                                     1-5/97                                     Drum
  [ ]          7/5/94      8-5-96, Rev. A        [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     8 Drums
                                                     1-5/97                                     Drum
  [ ]          2/1/93      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     5 Drums
                                                     1-5/97                                     Drum
  [ ]          7/5/93      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     5 Drums
                                                     1-5/97                                     Drum
  [ ]          7/6/94      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     4 Drums
                                                     1-5/97                                     Drum
  [ ]         7/16/93      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     6 Drums
                                                     1-5/97                                     Drum
  [ ]         9/27/94      10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Fiber     5 Drums
                                                     1-5/97                                     Drum
  [ ]         11/18/93     10-1-97, Rev. A       [ ] -4/98-Rev.        101, 200, 300, 302    55 G Poly     8 Drums
                                                     1-5/97                                     Drum
  [ ]         8/23/96      10-1-97, Rev. A       [ ]-4/98-Rev.1-5/97   101, 200, 300, 302    55 G Poly     6 Drums
                                                                                                 Drum

[ ]         9/19/96      8-5-96, Rev. A       [ ] -4/98-Rev.           101, 200, 300, 302         55 G Fiber        8 Drums
                                                   1-4/98                                           Drum
[ ]         9/19/96      8-5-96, Rev. A       [ ] -4/98-Rev.           101, 200, 300, 302         55 G Fiber        6 Drums
                                                   1-4/98                                           Drum
[ ]          6/9/98      6-9-98, Rev. B       [ ] -6/98-Rev. B         400, 404, 408              55 G Poly         5 Drums
                                                    6/98                                            Drum
[ ]         8/31/99      8-31-96, Rev. A      [ ] -8/99-Rev. A         DTM 101, 201,              55 G Poly         6 Drums
                                                    8/99               302, 303, 500, 607           Drum
[ ]         1/19/00      1-19-00, Rev. B      [ ] -1/00-Rev. 1         203, 6010A (1)            275 G Rock        2800 LBS
                                                                                                      Tote

PRODUCT      FORMULA        CONTROL PLAN              SPECIFICATION         CMC TEST                 STANDARD     MINIMUM ORDER
            (REVISION        (EFFECTIVE           (SPECIFICATION NO./       METHODS                  PACKAGE        QUANTITY
              DATE)            DATE/REVISION          REVISION DATE)        (TEST METHOD
                                   LEVEL)                                     NUMBER)

  [ ]        (US-[ ])        10-1-97 Rev. A          [ ] -4/98-Rev.         CTM 400, 407, 404       220 liter       1000 Kgs
              5/4/95                                      1-5/97                                    Poly Drum
  [ ]       D1.701.013       D1.701.013 Rev. 3       D1.701.013 Rev 3       CTM 400, 407, 405       220 liter       1062 Kgs
          Rev 3 23/12/99          23/12/99               23/12/99                                   Poly Drum
  [ ]       D1.701.003       D1.701.003 Rev. 2       D1.701.003 Rev.2       CTM 400, 407, 406       220 liter       1062 Kgs
          Rev.2 15/12/99          15/12/99               15/12/99                                   Poly Drum
  [ ]       D1.701.005       D1.701.005 Rev. 3       D1.701.005 Rev 3       CTM 400, 407, 407       220 liter       1090 Kgs
          Rev 3 16/12/99          16/12/99               16/12/99                                   Poly Drum
  [ ]       D1.701.024       D1.701.024 Rev. 2       D1.701.024 Rev. 2      CTM 400, 407, 411       220 liter       1028 Kgs
              Rev. 2              16/12/99               16/12/99                                   Poly Drum
             16/12/99
  [ ]       (US-A1695)       10-1-97 Rev. A          A1695-4/98-Rev.        CTM 400, 407, 413       220 liter       1000 Kgs
              7/5/93                                      1-5/97                                    Poly Drum
  [ ]       D1.701.036       D1.701.036 Rev. 2       D1.701.036 Rev. 2      CTM 400, 407, 416       220 liter       1088 Kgs
          Rev.2 23/12/99          23/12/99               23/12/99                                   Poly Drum
  [ ]       D1.701.037       D1.701.037 Rev. 2       D1.701.037 Rev. 2      CTM 400, 407, 417       220 liter       1088 Kgs
              Rev. 2              06/01/00               06/01/00                                   Poly Drum
             06/01/00
  [ ]       D1.701.038       D1.701.038 Rev. 2       D1.701.038 Rev. 2      CTM 400, 407, 418       220 liter       1460 Kgs
              Rev. 2              06/01/00               06/01/00                                   Poly Drum
             06/01/00
  [ ]       D1.701.040       D1.701.040 Rev, 3       D1.701.040 Rev. 3      CTM 400, 407, 420       220 liter       1090 Kgs
              Rev. 3              15/12/99               15/12/99                                   Poly Drum
             15/12/99
  [ ]       D1.701.002       D1.701.002 Rev. 2       D1.701.002 Rev. 2      CTM 400, 407, 424       220 liter       1240 Kgs
          Rev. 2 05/01/00         05/01/00               05/01/00                                   Poly Drum

[ ]       D1.701.017       D1.701.017 Rev. 2       D1.701.017 Rev. 2      CTM 400, 407, 425       220 liter        988 Kgs
            Rev. 2              15/12/99               15/12/99                                   Poly Drum
           15/12/99
[ ]       D1.701.033       D1.701.033 Rev. 2       D1.701.033 Rev. 2      CTM 400, 407, 426       220 liter       1070 Kgs
            Rev. 2              08/12/99               08/12/99                                   Poly Drum
           08/12/99

Exhibit 10.9

EMPLOYEE MATTERS AGREEMENT

DATED AS OF MARCH 28, 2000

BY AND BETWEEN

CABOT CORPORATION

AND

CABOT MICROELECTRONICS CORPORATION

EMPLOYEE MATTERS AGREEMENT

This EMPLOYEE MATTERS AGREEMENT, is made as of March 28, 2000
(the "Employee Matters Agreement"), by and between Cabot Corporation ("Cabot")
and Cabot Microelectronics Corporation ("Cabot Microelectronics") (each of Cabot and Cabot Microelectronics, a "Party," and, collectively, the "Parties").

RECITALS

WHEREAS, the Parties have entered into a Master Separation Agreement ("MSA"), dated as of March 28, 2000, relating to the complete separation of the "MMD Business" (as defined in the MSA) from Cabot; and

WHEREAS, the MSA contemplates that the Parties will enter into this Employee Matters Agreement to allocate between themselves the responsibilities, obligations and liabilities relating to the compensation and employee benefits of the CMC Employees in connection with such separation;

NOW, THEREFORE, in consideration of the covenants and agreements set forth below, the Parties agree as follows:

1. DEFINITIONS. As used in this Employee Matters Agreement, the following terms will have the following meanings, applicable both to the singular and the plural forms of the terms described:

(a) "Cabot Qualified Plans" shall mean Cabot's Cash Balance Plan, Employee Stock Ownership Plan and Retirement Incentive Savings Plan.

(b) "Cabot Supplemental Plans" shall mean Cabot's Supplemental Cash Balance Plan, Supplemental Employee Stock Ownership Plan, Supplemental Retirement Income Savings Plan and Deferred Compensation Plan.

(c) "CMC Benefit Arrangements" shall mean each and all pension, supplemental pension, accidental death and dismemberment, life and health insurance and benefits (including medical, dental, vision, life insurance, hospitalization, prescription drug, behavioral health and short- and long-term disability), savings, bonus, deferred compensation, incentive compensation, holiday, vacation, severance pay, salary continuation, tuition reimbursement, service award, company car, scholarship, relocation, patent award, fringe benefit and other employee benefit plans, programs, policies, agreements and arrangements providing or having any liability to provide compensation or benefits of any kind to the CMC Employees. The CMC Benefit Arrangements shall

include, but shall not be limited to, each "employee benefit plan" (as defined in Section 3(3) of ERISA) of Cabot Microelectronics.

(d) "CMC Employees" shall mean all persons who are active employees of Cabot Microelectronics, other than the CMC Foreign Employees. Prior to the Contribution Date, Cabot Microelectronics and Cabot shall have agreed on the names of those persons who will be CMC Employees as of the Contribution Date.

(e) "CMC Foreign Employees" shall mean all persons who are active employees of Cabot Microelectronics (determined in accordance with the law of the jurisdictions in which such individuals are located) who reside outside of the United States.

(f) "COBRA" shall mean the continuation coverage requirements of
Section 4980B(f) of the Code and Section 601 of ERISA.

(g) "Code" shall mean the Internal Revenue Code of 1986, as amended.

(h) "Contribution Date" shall have the meaning set forth in the MSA.

(i) "Distribution" and "Distribution Date" shall have the meaning set forth in the MSA.

(j) "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended.

(k) "IPO Effective Date" shall have the meaning set forth in the MSA.

(m) "IPO Registration Statement" means the registration statement on Form S-1, Registration No. 333-90593, filed by Cabot Microelectronics with the Securities and Exchange Commission in connection with the initial public offering of the Common Stock, $.001 par value per share, of Cabot Microelectronics, as it may be amended.

2. ASSUMPTION BY CABOT MICROELECTRONICS OF RESPONSIBILITIES, OBLIGATIONS AND LIABILITIES RELATING TO THE CMC EMPLOYEES

(a) Except as set forth in Section 2(c), as of the Contribution Date, Cabot Microelectronics shall (or shall cause one or more applicable CMC Benefit Plans to) assume all responsibilities, obligations and liabilities relating the employment, compensation and benefits of the CMC Employees as of and following the Contribution Date. Cabot shall retain all responsibilities, obligations and liabilities not so assumed by Cabot Microelectronics pursuant to this Employees Matters Agreement.

(b) Cabot shall indemnify Cabot Microelectronics and shall hold Cabot Microelectronics harmless from and against any damages, liabilities, costs or expenses which may be incurred or suffered by Cabot Microelectronics by reason of Cabot's failure to comply with any of the provisions of this Employee Matters Agreement, and Cabot Microelectronics shall indemnify Cabot and its affiliates (other than Cabot

Microelectronics) and hold Cabot and its affiliates (other than Cabot Microelectronics) harmless from and against any damages, liabilities, costs or expenses which may be incurred or suffered by Cabot and its affiliates (other than Cabot Microelectronics) by reason of Cabot Microelectronics' failure to comply with any of the provisions of this Employee Matters Agreement.

(c) The only exceptions to the responsibilities, obligations and liabilities assumed by Cabot Microelectronics pursuant to Section 2(a) are as follows:

(i) Cabot shall retain all responsibilities, obligations and liabilities relating to the Cabot Qualified Plans.

(ii) Cabot shall retain all responsibilities, obligations and liabilities under COBRA and state workers' compensation statutes relating to any CMC Employee (and, in the case of COBRA benefits, any qualified beneficiary of a CMC Employee) who becomes entitled to benefits under either of such statutes on or before the Contribution Date.

(iii) Cabot shall retain all responsibilities, obligations and liabilities for claims arising or incurred on or before the Contribution Date relating to any CMC Employee under any medical, dental, vision, life insurance, hospitalization, prescription drug, behavioral health and short-term disability plan of Cabot. For purposes of this Section 2(c)(iii), a claim shall be deemed to have arisen or to have been incurred upon the incurrence of a qualified expense for which reimbursement or payment is sought.

(iv) Cabot shall retain all responsibilities, obligations and liabilities for claims arising or incurred under Cabot's long-term disability plan with respect to any CMC Employee who becomes entitled to benefits thereunder on or before the Distribution Date (or such earlier date as Cabot and Cabot Microelectronics may mutually agree).

(v) Stock-based equity awards granted by Cabot to the CMC Employees pursuant to Cabot's equity incentive plans shall be treated as set forth in Section 6 of this Employee Matters Agreement. Benefits of the CMC Employees under the Cabot Supplemental Plans shall be treated as set forth in
Section 7 of this Employee Matters Agreement. Flexible spending accounts of the CMC Employees under Cabot's flexible benefits plan shall be treated as set forth in Section 8 of this Employee Matters Agreement.

(d) Cabot Microelectronics shall promptly reimburse Cabot, upon Cabot's reasonable request, for any responsibilities, obligations and liabilities satisfied by Cabot that have been assumed by Cabot Microelectronics pursuant to this Section 2, and Cabot shall promptly reimburse Cabot Microelectronics, upon Cabot Microelectronics'

reasonable request, for any responsibilities, obligations and liabilities satisfied by Cabot Microelectronics that have been retained by Cabot pursuant to this Section 2.

3. ESTABLISHMENT OF CMC BENEFIT ARRANGEMENTS

(a) Cabot Microelectronics shall establish the following CMC Benefit Arrangements on or before such times as are set forth below:

(i) Qualified Defined Contribution Plan. On or before the IPO Effective Date, Cabot Microelectronics shall adopt a defined contribution plan for the benefit of the CMC Employees. Such plan shall be qualified under Sections 401(a) and 401(k) of the Code and shall contain such rights and features as Cabot Microelectronics shall determine. The CMC Employees shall commence to participate in such plan as of the first day of the month immediately following the month in which the IPO Effective Date occurs.

(ii) Employee Stock Purchase Plan. On or before the IPO Effective Date, Cabot Microelectronics shall adopt an employee stock purchase plan for the benefit of the CMC Employees. Such plan shall be a plan to which
Section 423 of the Code applies and shall contain such rights and features as Cabot Microelectronics shall determine. Subject to Section 3(h), the first offering period under such plan shall commence on the IPO Effective Date (or such other date as Cabot Microelectronics shall establish).

(iii) Supplemental Retirement Plan. On or before the IPO Effective Date, Cabot Microelectronics shall adopt a supplemental retirement plan for the purpose of providing supplemental retirement benefits to the CMC Employees whose contributions to the CMC qualified defined contribution plan are limited by reason of application of Sections 415(a) and 401(a)(17) of the Code. Such plan shall in Cabot Microelectronics' discretion be either an "excess benefit plan" (within the meaning of Section 3(36) of ERISA) or a plan which is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees and shall contain such rights and features as Cabot Microelectronics shall determine; provided, however, that Cabot Microelectronics shall cause such plan to be "unfunded" for purposes of ERISA and the Code (but the application of this proviso shall not preclude Cabot Microelectronics from establishing and making contributions to one or more grantor trusts relating to such plan). The CMC Employees shall commence to participate in such plan as of the first day of the month immediately following the month in which the IPO Effective Date occurs.

(iv) Equity Incentive Plan. Prior to the IPO Effective Date, Cabot Microelectronics shall adopt an equity incentive plan for the purpose of making equity-based incentive awards relating to the common stock of Cabot Microelectronics. Subject

to Section 3(h), equity awards shall be made thereunder as of and after the IPO Effective Date at such times, in such amounts and to such persons as Cabot Microelectronics shall determine.

(v) Medical and Health Plans. Prior to the Distribution Date, Cabot Microelectronics shall establish one or more plans providing medical, dental, vision, life insurance, hospitalization, prescription drug, behavioral health and short- and long-term disability benefits to the CMC Employees and their eligible dependents. The CMC Employees shall commence to participate in such plans as of the Distribution Date (or such earlier date as Cabot and Cabot Microelectronics may mutually agree).

(vi) Employment, Severance and Change-in-Control Agreements and Arrangements. Following the IPO Effective Date, Cabot Microelectronics shall enter into such agreements and other arrangements relating to the severance and termination payments and benefits to which CMC Employees shall become entitled upon termination of employment following a "change in control" of Cabot Microelectronics (as defined therein) as Cabot Microelectronics in its sole discretion deems necessary or advisable. The terms and conditions of these agreements and arrangements (including, without limitation, eligibility, conditions to entitlements and nature and amount of payments and benefits) shall be determined by Cabot Microelectronics in its sole discretion.

(b) In addition to the CMC Benefit Arrangements to be adopted and established pursuant to Section 3(a), Cabot Microelectronics shall establish such other CMC Benefit Arrangements and such other practices and policies relating thereto as it deems necessary and appropriate for the purpose of providing compensation and employee benefits to the CMC Employees.

(c) To the extent that service is relevant to eligibility, vesting or determination of levels of benefits under any CMC Benefit Arrangement, such CMC Benefit Arrangement shall provide credit for service by CMC Employees with Cabot or any of its affiliates (but excluding (i) accrual of benefits under any defined benefit pension plan that Cabot Microelectronics may establish and (ii) service awards).

(d) Cabot Microelectronics shall bear all responsibilities, obligations and liabilities under the CMC Benefit Arrangements.

(e) Except as set forth in this Section 3, nothing in this Employee Matters Agreement shall prohibit Cabot Microelectronics from amending, modifying or terminating any CMC Benefit Arrangement following the Distribution Date.

(f) With respect to CMC Benefit Arrangements that provide for medical, dental, vision, life insurance, hospitalization, prescription drug, behavioral health and short- and long-term disability benefits or other, similar welfare benefits, no pre-existing

conditions exclusions shall be applied to a CMC Employee participating therein except to the extent such CMC Employee has not satisfied any such exclusion under the plan of Cabot providing such benefits in which such CMC Employee participated immediately prior to the commencement of participation in such CMC Benefit Arrangement. Any amounts for out-of-pocket limits and benefit maximums paid or incurred in any plan year under any such Cabot plan by a CMC Employee during such plan year shall be counted toward such CMC Employee's out-of-pocket limits and benefit maximums under such CMC Benefit Arrangement for the same plan year.

(g) The Parties shall take all steps necessary such that (i) any CMC Benefit Arrangements in effect as of the IPO Effective Date shall comply in form and in operation with all applicable law (including, without limitation, ERISA, the Code and the federal securities laws) as of the IPO Effective Date, and (ii) equity awards granted under the CMC equity incentive plan prior to the Distribution Date shall constitute qualified performance-based compensation under Section 162(m) of the Code.

(h) The Parties shall take all steps necessary such that no issuance of Cabot Microelectronics common stock shall be made, no Cabot Microelectronics stock-based equity award shall be granted and no other action shall be taken if such issuance, grant or other action would preclude the Distribution from being tax-free to Cabot and its stockholders.

4. CESSATION OF PARTICIPATION IN CABOT BENEFIT PLANS AND ARRANGEMENTS

(a) Except as set forth in Sections 4(b), effective as of the IPO Effective Date, the CMC Employees shall cease to participate in, be covered by, receive benefits under or have any rights under the employee benefit plans and arrangements of Cabot, except for benefits and rights relating to their participation therein prior to the IPO Effective Date.

(b) The only exceptions to Section 4(a) are as follows:

(i) The CMC Employees shall cease to accrue benefits under Cabot's Cash Balance Plan (and, if applicable, the Cabot Supplemental Plan relating thereto) on the last day of the month in which the IPO Effective Date occurs.

(ii) The CMC Employees shall receive allocations under Cabot's Employee Stock Ownership Plan (and, if applicable, the Cabot Supplemental Plan relating thereto) at the end of the calendar quarter in which the IPO Effective Date occurs; provided, however, that such allocations shall reflect only service and compensation through the last day of the month in which the IPO Effective Date occurs. Cabot shall contribute an amount equal to such contributions to Cabot's Employee Stock Ownership Plan as soon as practicable following the end of the calendar quarter in which the IPO

Effective Date occurs and shall cause such contributions to be allocated to the accounts of the CMC Employees participating therein.

(iii) The CMC Employees shall receive matching contributions under Cabot's Retirement Incentive Savings Plan (and, if applicable, the Cabot Supplemental Plan relating thereto) at the end of the calendar quarter in which the IPO Effective Date occurs; provided, however, that such matching contributions shall be limited to reflect elective deferrals through the last day of the month in which the IPO Effective Date occurs. Cabot shall contribute an amount equal to such contributions to Cabot's Retirement Incentive Savings Plan as soon as practicable following the end of the calendar quarter in which the IPO Effective Date occurs and shall cause such contributions to be allocated to the accounts of the CMC Employees participating therein. Outstanding loans under Cabot's Retirement Incentive Savings Plan shall be treated as set forth in
Section 5 of this Employee Matters Agreement.

(iv) The CMC Employees shall cease to participate in the medical, dental, vision, life insurance, hospitalization, prescription drug, behavioral health and short- and long-term disability and other, similar plans sponsored by Cabot as of the earlier of (x) the date on which they commence to participate in medical and health plans sponsored by Cabot Microelectronics and
(y) the Distribution Date.

(v) The CMC Employees shall cease to participate in Cabot's Employee Stock Purchase Plan as of the last payroll date prior to the IPO Effective Date. As soon as practicable following such payroll date, any payroll deductions of such CMC Employees shall be applied to the purchase of shares of Cabot common stock, and any excess payroll deductions not so applied shall be returned to such CMC Employees.

(vi) Stock-based equity awards granted by Cabot to the CMC Employees pursuant to Cabot's equity incentive plans shall be treated as set forth in Section 6 of this Employee Matters Agreement. Benefits of the CMC Employees under the Cabot Supplemental Plans shall be treated as set forth in
Section 7 of this Employee Matters Agreement. Flexible spending accounts of the CMC Employees under Cabot's flexible benefits plan shall be treated as set forth in Section 8 of this Employee Matters Agreement.

(c) Prior to the IPO Effective Date, Cabot shall take all action necessary such that each CMC Employee shall, effective immediately prior to the Distribution Date, become fully vested in any unvested portion of his or her accrued benefit under the Cabot Qualified Plans and the Cabot Supplemental Plans.

5. TREATMENT OF LOANS UNDER THE CABOT RETIREMENT INCENTIVE SAVINGS PLAN. Subject to any applicable loan provisions under Cabot's Retirement Incentive Savings Plan as in effect on the date hereof, Cabot and Cabot

Microelectronics shall take all actions necessary such that, in connection with the Distribution, each participant in such plan who is a participant in Cabot Microelectronics' defined contribution plan is provided with the opportunity to repay any outstanding loans under the Retirement Incentive Savings Plan and to establish loans of substantially equal amounts under the Cabot Microelectronics defined contribution plan.

6. CONVERSION OF CABOT EQUITY AWARDS. Subject to Section 3(h), equity awards granted to CMC Employees by Cabot under the equity incentive plans of Cabot may be converted at such times and in such a manner as Cabot and Cabot Microelectronics shall agree. As of the date of such conversion, Cabot Microelectronics shall be deemed to have assumed all such converted awards.

7. TREATMENT OF LIABILITIES RELATING TO DEFERRED COMPENSATION AND SUPPLEMENTAL BENEFITS

(a) Cabot shall take all steps necessary such that: (i) each CMC Employee who participates in the Cabot Supplemental Plans may elect to reduce to zero his or her aggregate accrued benefits thereunder and be credited with an opening account balance of equivalent value under the supplemental retirement plan established by Cabot Microelectronics pursuant to Section 3(a)(iii) of this Employee Matters Agreement; and (ii) the aggregate accrued benefits of each CMC Employee under the Cabot Supplemental Plans who so elects shall, as of the Distribution Date, be so reduced; provided, however, that no such election by a CMC Employee so to reduce his or her aggregate accrued benefits under any Cabot Supplemental Plan shall be of any force and effect unless he or she makes such election with respect to all of the Cabot Supplemental Plans in which he or she participates.

(b) Cabot Microelectronics shall take all steps necessary such that:
(i) the supplemental retirement plan established by it pursuant to Section 3(a)(iii) of this Employee Matters Agreement shall permit the crediting of opening account balances with respect to each CMC Employee who has made the election under the Cabot Supplemental Plans contemplated by Section 7(a) of this Employee Matters Agreement; and (ii) such opening account balance shall, as of the Distribution Date, be so credited with respect to (and only with respect to) each CMC Employee who has made such an election.

(c) Any account balance credited under the Cabot Microelectronics supplemental retirement plan established by it pursuant to Section 3(a)(iii) of this Employee Matters Agreement shall be subject to such terms and conditions as Cabot Microelectronics shall determine; provided, however, that no such term or condition shall (i) cause any such account balance to be forfeitable and (ii) without the consent of the applicable CMC Employee, postpone the payment of any such account balance after termination of his or her employment.

(d) As of the Distribution Date, Cabot Microelectronics shall assume all account balances credited pursuant to this Section 7.

8. TREATMENT OF FLEXIBLE SPENDING ACCOUNTS.

(a) Effective as of a date prior to the Distribution Date as the Parties shall agree, the Parties shall take all steps necessary and appropriate so that Cabot Microelectronics assumes the Cabot Corporation Flexible Benefits Plan with respect to the CMC Employees who participate therein (the Cabot Corporation Flexible Benefits Plan, the "Cabot FBP," and the Cabot Microelectronics flexible benefits plan resulting from such assumption, the "CMC FBP"). To the extent that the date of such assumption is other than as of the first day of a plan year of the Cabot FBP (such date of assumption, the "Assumption Date"): (x) the Parties shall take all steps necessary or appropriate so that the book entry account balances (reflecting salary deductions, deemed employer contributions (if any) and qualified expenses paid (if any)) under the Cabot FBP of each such CMC Employee shall become account balances, as of the Assumption Date, under the CMC FBP; and (y) the Parties shall take all steps necessary or appropriate so that the contribution elections of each such CMC Employee as in effect immediately before the Assumption Date under the Cabot FBP remain in effect under the CMC FBP immediately after the Assumption Date.

(b) As soon as practicable following March 31 following the plan year of the Cabot FBP in which the Assumption Date occurs, Cabot and Cabot Microelectronics shall agree upon the appropriate method of allocating between them any losses suffered by either of them by reason of Section 8(a) of this Employee Matters Agreement.

9. FOREIGN EMPLOYEES. As of the Contribution Date, Cabot Microelectronics shall assume all responsibilities, obligations and liabilities relating to the employment, compensation and benefits of the CMC Foreign Employees as of and following the Contribution Date. Cabot shall retain all responsibilities, obligations and liabilities not so assumed by Cabot Microelectronics pursuant to this Section 9.

10. COOPERATION.

(a) Cabot Microelectronics and Cabot shall reasonably cooperate with each other in carrying out the terms of this Employee Matters Agreement with the purpose of effectuating the intent hereof, and each Party shall exchange such information with the other Party as may be reasonably requested by the other Party relating hereto.

(b) Each of the Parties shall provide to the other Party, upon such other Party's reasonable request, any and all information in such Party's possession which relates to such Party's employee benefit plans, programs and arrangements, including, without limitation, annual reports on Form 5500, actuarial valuations and materials relating to

nondiscrimination and coverage; provided, however, that (i) no Party shall be required (x) to prepare any document in response to any such request or (y) to produce any document which is subject to a claim of privilege, and (ii) no Party shall be required to respond to any such request to the extent that such request relates to any period other than the period commencing on January 1, 1999 and ending, with respect to all of the Parties' employee benefit plans, programs and arrangements other than the Parties' tax-qualified plans, on the third anniversary of the Distribution Date, and ending, with respect to the Parties' tax-qualified plans, on December 31 of the year in which the sixth anniversary of the Distribution Date occurs.

11. ORDER OF PRECEDENCE. The Parties agree that, if any terms of this Employee Matters Agreement conflict with the terms in the MSA, the terms of this Employee Matters Agreement shall govern with respect to the resolution of such conflict.

12. INCORPORATION OF ARTICLE 7 OF THE MSA. The provisions of Article 7 of the MSA are incorporated into and made part of this Employee Matters Agreement by reference.

13. EFFECTIVE TIME. This Agreement shall become effective upon the closing of the initial public offering described in the IPO Registration Statement.

IN WITNESS WHEREOF, the Parties hereto have executed this Employee Matters Agreement, effective as of the date first written above.

                                       CABOT MICROELECTRONICS
CABOT CORPORATION                      CORPORATION




/s/ Samuel W. Bodman                   /s/ Matthew Neville
---------------------------------      -------------------------------------
By:  Samuel W. Bodman                  By:  Matthew Neville
Its:  Chairman and CEO                 Its:  President and CEO

Exhibit 10.10

REGISTRATION RIGHTS AGREEMENT

by and between

CABOT MICROELECTONICS CORPORATION

and

CABOT CORPORATION

Dated as of March 28, 2000

-I-

Exhibit 10.10

REGISTRATION RIGHTS AGREEMENT

This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is made as of March 28, 2000, by and between CABOT MICROELECTRONICS CORPORATION, a Delaware corporation (the "Company") and CABOT CORPORATION, a Delaware corporation ("Cabot").

WHEREAS, as of the date hereof, the Company and its subsidiary and Cabot and certain of its subsidiaries are entering into a Master Separation Agreement (the "Master Separation Agreement"), pursuant to which, among other things, Cabot and such subsidiaries are transferring to the Company, and the Company and such subsidiary are assuming, certain assets and liabilities of the Microelectronics Materials Division of Cabot;

WHEREAS, as of the date hereof, the Company and Cabot are entering into an IPO and Distribution Agreement (the "IPO and Distribution Agreement"), pursuant to which, among other things, upon the occurrence of certain events, the Company will effect an initial public offering of its Common Stock;

WHEREAS, following the initial public offering by the Company, Cabot intends to divest itself of its entire ownership of the Company through one or more tax-free distributions to the holders of Cabot's common stock (the "Distribution"); and

WHEREAS, in connection with (i) the Company and Cabot entering into the Master Separation Agreement, and (ii) the Company and Cabot entering into the IPO and Distribution Agreement, the Company has agreed to provide the registration rights set forth in this Agreement.

ACCORDINGLY, the parties hereto agree as follows:

1. Certain Definitions.

As used in this Agreement, the following terms shall have the meanings ascribed to them below:

"Affiliate" means (i) with respect to any Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person or (ii) with respect to any individual, shall also mean the spouse or child of such individual; provided, that neither the Company nor any Person controlled by the Company shall be deemed to be an Affiliate of any Holder.

"Certificate of Incorporation" means the Certificate of Incorporation of the Company, as amended.

"Common Stock" means the Common Stock, par value $.001 per share, of the Company and any equity securities issued or issuable with respect to the Common Stock in connection with a reclassification, recapitalization, merger, consolidation or other reorganization.

"Common Stock Equivalents" means any securities convertible into, or exercisable or exchangeable for, shares of Common Stock.

"Holder" or "Holders" means any party who is a signatory to this Agreement and, subject to Section 4.6(a), any party who shall hereafter acquire and hold Registrable Securities.

"IPO" means the initial underwritten offering pursuant to which the Common Stock becomes registered under Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange Act").

"Major Holder" means with respect to any registration the Holder that, together with its Affiliates, includes the largest number of Registrable Securities in such registration.

"Person" means any individual, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivisions thereof.

"Registrable Securities" means any (a) shares of Common Stock held by Cabot and (b) shares of Common Stock issued or issuable, directly or indirectly, with respect to the Common Stock referenced in clause (a) above by way of stock dividend, stock split or combination of shares. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when (A) a registration statement with respect to the sale of such Registrable Securities shall have become effective under the Securities Act and such Registrable Securities shall have been disposed of in accordance with such registration statement; (B) such Shares shall have been sold to the public pursuant to Rule 144 under the Securities Act (or any successor provision); (C) such Registrable Securities shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent public distribution of them shall not require registration or qualification of them under the Securities Act or any similar state law then in force; and (D) such Registrable Securities shall have ceased to be outstanding.

"SEC" means the Securities and Exchange Commission.

"Securities Act" means the Securities Act of 1933, as amended.

2. Registration Rights.

2.1. Demand Registrations.

(a) (i) Subject to Sections 2.1(b) and 2.3 below, at any time and from time to time after the closing of an IPO and the delivery by Cabot to the Company of written notice, pursuant to Section 2.6 of the IPO and Distribution Agreement, that Cabot no longer intends to proceed with or complete the Distribution (the "Registration Rights Trigger Date"), Cabot shall have the right to require the Company to file a registration statement under the Securities Act covering all or any part of its Registrable Securities, by delivering a written request therefor to the Company specifying the number of Registrable Securities to be included in such registration by Cabot and the intended method of distribution thereof. All such requests by Cabot pursuant to this Section 2.1(a)(i) are referred to herein as "Demand Registration Requests," and the registrations so requested are referred to herein as "Demand Registrations" (with respect to any Demand Registration, the Holder making such demand for registration being referred to as the "Initiating Holder"). As promptly as practicable, but no later than ten days after receipt of a Demand Registration Request, the Company shall give written notice (the "Demand Exercise Notice") of such Demand Registration Request to all Holders of record of Registrable Securities.

(ii) The Company, subject to Sections 2.3 and 2.6, shall include in a Demand Registration (x) the Registrable Securities of the Initiating Holder and (y) the Registrable Securities of any other Holder which shall have made a written request to the Company for inclusion in such registration (which request shall specify the maximum number of Registrable Securities intended to be disposed of by such Holder) within 30 days after the receipt of the Demand Exercise Notice (or, 15 days if, at the request of the Initiating Holder or the Major Holder participating in such registration, the Company states in such written notice or gives telephonic notice to all Holders, with written confirmation to follow promptly thereafter, that such registration will be on a Form S-3).

(iii) The Company shall, as expeditiously as possible, use its best efforts to (x) effect such registration under the Securities Act (including, without limitation, by means of a shelf registration pursuant to Rule 415 under the Securities Act if so requested and if the Company is then eligible to use such a registration) of the Registrable Securities which the Company has been so requested to register, for distribution in accordance with such intended method of distribution, and (y) if requested by the Initiating Holder or the Major Holder participating in such registration, obtain acceleration of the effective date of the registration statement relating to such registration.

(b) The Demand Registration rights granted in Section 2.1(a) to the Holders are subject to the following limitations: (i) with respect to any registration in respect of a Demand Registration Request initiated by a transferee of Cabot, such registration statement must include shares of Common Stock representing, in the aggregate (based on the Common Stock included in such registration by Cabot), in excess of 20% of the sum of (x) the amount of shares of Registrable Securities held, in the aggregate, by Cabot and its transferees immediately prior to such registration plus (y) the amount of shares of Common Stock obtainable upon the conversion of Common Stock Equivalents held, in the aggregate, by Cabot and their transferees immediately prior to such registration; (ii) the Company shall not be required to cause a registration pursuant to Section 2.1(a)(i) to be declared effective within a period of 180 days after the effective date of any registration statement of the Company effected in connection with a Demand Registration Request; and (iii) if the Board of Directors of the Company, in its good faith judgment, determines that any registration of Registrable Securities should not be made or continued because it would materially interfere with any material financing, acquisition, corporate reorganization or merger or other transaction involving the Company or any of its subsidiaries (a "Valid Business Reason"), (x) the Company may postpone filing a registration statement relating to a Demand Registration Request until such Valid Business Reason no longer exists, but in no event for more than three months, and (y) in case a registration statement has been filed relating to a Demand Registration Request, if the Valid Business Reason has not resulted from actions taken by the Company, the Company may cause such registration statement to be withdrawn and its effectiveness terminated or may postpone amending or supplementing such registration statement until such Valid Business Reason no longer exists, but in no event for more than three months (such period of postponement or withdrawal under subclauses (x) or (y) of this clause (iv), the "Postponement Period"); and the Company shall give written notice of its determination to postpone or withdraw a registration statement and of the fact that the Valid Business Reason for such postponement or withdrawal no longer exists, in each case, promptly after the occurrence thereof; provided, however, the Company shall not be permitted to postpone or withdraw a registration statement after the expiration of any Postponement Period until twelve months after the expiration of such Postponement Period without the prior written approval of Cabot.

If the Company shall give any notice of postponement or withdrawal of any registration statement, the Company shall not, during the period of postponement or withdrawal, register any Common Stock, other than pursuant to a registration statement on Form S-4 or S-8 (or an equivalent registration form then in effect). Each Holder of Registrable Securities agrees that, upon receipt of any notice from the Company that the Company has determined to withdraw any registration statement pursuant to clause (iii) above, such Holder will discontinue its disposition of Registrable Securities pursuant to such registration statement and, if so directed by the Company, will deliver to the Company (at the Company's expense) all copies, other than permanent file copies, then in

such Holder's possession of the prospectus covering such Registrable Securities that was in effect at the time of receipt of such notice. If the Company shall have withdrawn or prematurely terminated a registration statement filed under
Section 2.1(a)(i) (whether pursuant to clause (iii) above or as a result of any stop order, injunction or other order or requirement of the SEC or any other governmental agency or court), the Company shall not be considered to have effected an effective registration for the purposes of this Agreement until the Company shall have filed a new registration statement covering the Registrable Securities covered by the withdrawn registration statement and such registration statement shall have been declared effective and shall not have been withdrawn. If the Company shall give any notice of withdrawal or postponement of a registration statement, the Company shall, at such time as the Valid Business Reason that caused such withdrawal or postponement no longer exists (but in no event later than three months after the date of the postponement or withdrawal), use its best efforts to effect the registration under the Securities Act of the Registrable Securities covered by the withdrawn or postponed registration statement in accordance with this Section 2.1 (unless the Initiating Holder shall have withdrawn such request, in which case the Company shall not be considered to have effected an effective registration for the purposes of this Agreement).

(c) The Company, subject to Sections 2.3 and 2.6, may elect to include in any registration statement and offering made pursuant to Section 2.1(a)(i), (i) authorized but unissued shares of Common Stock or shares of Common Stock held by the Company as treasury shares and (ii) any other shares of Common Stock which are requested to be included in such registration pursuant to the exercise of piggyback rights granted by the Company after the date hereof which are not inconsistent with the rights granted in, or otherwise conflict with the terms of, this Agreement ("Additional Piggyback Rights") provided, however, that such inclusion shall be permitted only to the extent that it is pursuant to and subject to the terms of the underwriting agreement or arrangements, if any, entered into by the Initiating Holder.

(d) In connection with any Demand Registration, the Major Holder participating in such registration shall have the right to designate the lead managing underwriter, and subject to the next sentence, each other managing underwriter for such registration, provided that each such other managing underwriter is reasonably satisfactory to the Company, it being understood and agreed that any managing underwriter that participates in the Company's IPO shall be satisfactory to the Company. The Company shall have the right to designate one managing underwriter other than the lead managing underwriter in any such registration, provided that such other managing underwriter is reasonably satisfactory to the Major Holder, it being understood and agreed that any managing underwriter that participates in the Company's IPO shall be satisfactory to the Major Holder.

2.2. Piggyback Registrations.

(a) If, at any time after the Registration Rights Trigger Date, the Company proposes or is required to register any of its equity securities under the Securities Act (other than pursuant to (i) registrations on such form or similar form(s) solely for registration of securities in connection with an employee benefit plan or dividend reinvestment plan or a merger or consolidation or (ii) a Demand Registration under Section 2.1) on a registration statement on Form S-1, Form S-2 or Form S-3 (or an equivalent general registration form then in effect), whether or not for its own account, the Company shall give prompt written notice of its intention to do so to each of the Holders of record of Registrable Securities. Upon the written request of any such Holder, made within 20 days following the receipt of any such written notice (which request shall specify the maximum number of Registrable Securities intended to be disposed of by such Holder and the intended method of distribution thereof), the Company shall, subject to Sections 2.2(b), 2.3 and 2.6 hereof, use its best efforts to cause all such Registrable Securities, the Holders of which have so requested the registration thereof, to be registered under the Securities Act (with the securities which the Company at the time proposes to register) to permit the sale or other disposition by the Holders (in accordance with the intended method of distribution thereof) of the Registrable Securities to be so registered. There is no limitation on the number of such piggyback registrations pursuant to the preceding sentence which the Company is obligated to effect. No registration effected under this Section 2.2(a) shall relieve the Company of its obligations to effect Demand Registrations.

(b) If, at any time after giving written notice of its intention to register any equity securities and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason not to register or to delay registration of such equity securities, the Company may, at its election, give written notice of such determination to all Holders of record of Registrable Securities and (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such abandoned registration, without prejudice, however, to the rights of Holders under Section 2.1, and (ii) in the case of a determination to delay such registration of its equity securities, shall be permitted to delay the registration of such Registrable Securities for the same period as the delay in registering such other equity securities.

(c) Any Holder shall have the right to withdraw its request for inclusion of its Registrable Securities in any registration statement pursuant to this Section 2.2 by giving written notice to the Company of its request to withdraw; provided, however, that (i) such request must be made in writing prior to the earlier of the execution of the underwriting agreement or the execution of the custody agreement with respect to such registration and
(ii) such withdrawal shall be irrevocable and, after making such

withdrawal, a Holder shall no longer have any right to include Registrable Securities in the registration as to which such withdrawal was made.

2.3. Allocation of Securities Included in Registration Statement.

(a) If any requested registration pursuant to Section 2.1 involves an underwritten offering and the lead managing underwriter of such offering (the "Manager") shall advise the Company that, in its view, the number of securities requested to be included in such registration by the Holders or any other persons (including those shares of Common Stock requested by the Company to be included in such registration) exceeds the largest number (the "Section 2.1 Sale Number") that can be sold in an orderly manner in such offering within a price range acceptable to the Initiating Holder, the Company shall include in such registration:

(i) all Registrable Securities requested to be included in such registration by Holders of Registrable Securities; provided, however, that, if the number of such Registrable Securities exceeds the Section
2.1 Sale Number, the number of such Registrable Securities (not to exceed the
Section 2.1 Sale Number) to be included in such registration shall be allocated on a pro rata basis among all Holders requesting that Registrable Securities be included in such registration, based on the number of Registrable Securities then owned by each Holder requesting inclusion in relation to the number of Registrable Securities owned by all Holders requesting inclusion;

(ii) to the extent that the number of Registrable Securities to be included by all Holders pursuant to clause (i) of this Section 2.3(a) is less than the Section 2.1 Sale Number, securities that the Company proposes to register; and

(iii) to the extent that the number of Registrable Securities to be included by all Holders and the number of securities to be included by the Company is less than the Section 2.1 Sale Number, any other securities that the holders thereof propose to register pursuant to the exercise of Additional Piggyback Rights.

If, as a result of the proration provisions of this Section 2.3(a), any Holder shall not be entitled to include all Registrable Securities in a registration that such Holder has requested be included, such Holder may elect to withdraw his request to include Registrable Securities in such registration or may reduce the number requested to be included; provided, however, that (x) such request must be made in writing prior to the earlier of the execution of the underwriting agreement or the execution of the custody agreement with respect to such registration and (y) such withdrawal shall be irrevocable and, after making such withdrawal, a Holder shall no longer have any right to include Registrable Securities in the registration as to which such withdrawal was made.

(b) If any registration pursuant to Section 2.2 involves an underwritten offering and the Manager shall advise the Company that, in its view, the number of securities requested to be included in such registration exceeds the number (the "Section 2.2 Sale Number") that can be sold in an orderly manner in such registration within a price range acceptable to the Company, the Company shall include in such registration:

(i) all Common Stock or securities convertible into, or exchangeable or exercisable for, Common Stock that the Company proposes to register for its own account (the "Company Securities");

(ii) to the extent that the number of Company Securities is less than the Section 2.2 Sale Number, the remaining shares to be included in such registration shall be allocated on a pro rata basis among all Holders of Registrable Securities requesting that Registrable Securities be included in such registration, based on the number of Registrable Securities then owned by each Holder requesting inclusion in relation to the number of Registrable Securities owned by all Holders requesting inclusion; and

(iii) to the extent the number of Company Securities plus the number of Registrable Securities requested to be included by all Holders is less than the Section 2.2 Sale Number, any other securities that the holders thereof propose to register pursuant to the exercise of Additional Piggyback Rights.

2.4. Registration Procedures.

If and whenever the Company is required by the provisions of this Agreement to use its best efforts to effect or cause the registration of any Registrable Securities under the Securities Act as provided in this Agreement, the Company shall, as expeditiously as possible:

(a) prepare and file with the SEC a registration statement on an appropriate registration form of the SEC for the disposition of such Registrable Securities in accordance with the intended method of disposition thereof, which form (i) shall be selected by the Company and (ii) shall, in the case of a shelf registration, be available for the sale of the Registrable Securities by the selling Holders thereof and such registration statement shall comply as to form in all material respects with the requirements of the applicable form and include all financial statements required by the SEC to be filed therewith, and the Company shall use its best efforts to cause such registration statement to become and remain effective (provided, however, that before filing a registration statement or prospectus or any amendments or supplements thereto, or comparable statements under securities or blue sky laws of any jurisdiction, the Company will furnish to one counsel for the Holders participating in the planned offering (selected by the

Initiating Holder, in the case of a registration pursuant to Section 2.1, and selected by the Major Holder, in the case of a registration pursuant to Section 2.2) and the underwriters, if any, copies of all such documents proposed to be filed (including all exhibits thereto), which documents will be subject to the reasonable review and reasonable comment of such counsel, and the Company shall not file any registration statement or amendment thereto or any prospectus or supplement thereto to which the Holders of a majority of the Registrable Securities covered by such registration statement or the underwriters, if any, shall reasonably object in writing);

(b) prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for such period (which shall not be required to exceed 180 days in the case of a registration pursuant to Section 2.1 or 120 days in the case of a registration pursuant to Section 2.2) as any seller of Registrable Securities pursuant to such registration statement shall request and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all Registrable Securities covered by such registration statement in accordance with the intended methods of disposition by the seller or sellers thereof set forth in such registration statement;

(c) furnish, without charge, to each seller of such Registrable Securities and each underwriter, if any, of the securities covered by such registration statement such number of copies of such registration statement, each amendment and supplement thereto (in each case including all exhibits), and the prospectus included in such registration statement (including each preliminary prospectus) in conformity with the requirements of the Securities Act, and other documents, as such seller and underwriter may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities owned by such seller (the Company hereby consenting to the use in accordance with all applicable law of each such registration statement (or amendment or post-effective amendment thereto) and each such prospectus (or preliminary prospectus or supplement thereto) by each such seller of Registrable Securities and the underwriters, if any, in connection with the offering and sale of the Registrable Securities covered by such registration statement or prospectus);

(d) use its best efforts to register or qualify the Registrable Securities covered by such registration statement under such other securities or "blue sky" laws of such jurisdictions as any sellers of Registrable Securities or any managing underwriter, if any, shall reasonably request, and do any and all other acts and things which may be reasonably necessary or advisable to enable such sellers or underwriter, if any, to consummate the disposition of the Registrable Securities in such jurisdictions, except that in no event shall the Company be required to qualify to do business as a foreign corporation in any jurisdiction where it would not, but for the requirements of this

paragraph (d), be required to be so qualified, to subject itself to taxation in any such jurisdiction or to consent to general service of process in any such jurisdiction;

(e) promptly notify each Holder selling Registrable Securities covered by such registration statement and each managing underwriter, if any:
(i) when the registration statement, any pre-effective amendment, the prospectus or any prospectus supplement related thereto or post-effective amendment to the registration statement has been filed and, with respect to the registration statement or any post-effective amendment, when the same has become effective;
(ii) of any request by the SEC or state securities authority for amendments or supplements to the registration statement or the prospectus related thereto or for additional information; (iii) of the issuance by the SEC of any stop order suspending the effectiveness of the registration statement or the initiation of any proceedings for that purpose; (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the securities or blue sky laws of any jurisdiction or the initiation of any proceeding for such purpose; (v) of the existence of any fact of which the Company becomes aware which results in the registration statement, the prospectus related thereto or any document incorporated therein by reference containing an untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make any statement therein not misleading; and (vi) if at any time the representations and warranties contemplated by any underwriting agreement, securities sale agreement, or other similar agreement, relating to the offering shall cease to be true and correct in all material respects; and, if the notification relates to an event described in clause (v), the Company shall promptly prepare and furnish to each such seller and each underwriter, if any, a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein in the light of the circumstances under which they were made not misleading;

(f) comply with all applicable rules and regulations of the SEC, and make generally available to its security holders, as soon as reasonably practicable after the effective date of the registration statement (and in any event within 17 months thereafter), an earnings statement (which need not be audited) covering the period of at least twelve consecutive months beginning with the first day of the Company's first calendar quarter after the effective date of the registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;

(g) (i) cause all such Registrable Securities covered by such registration statement to be listed on the principal securities exchange on which similar securities issued by the Company are then listed (if any), if the listing of such Registrable Securities

is then permitted under the rules of such exchange, or (ii) if no similar securities are then so listed, to either cause all such Registrable Securities to be listed on a national securities exchange or to secure designation of all such Registrable Securities as a Nasdaq National Market "national market system security" within the meaning of Rule 11Aa2-1 of the Exchange Act or, failing that, secure Nasdaq National Market authorization for such shares and, without limiting the generality of the foregoing, take all actions that may be required by the Company as the issuer of such Registrable Securities in order to facilitate the managing underwriter's arranging for the registration of at least two market makers as such with respect to such shares with the National Association of Securities Dealers, Inc. (the "NASD");

(h) provide and cause to be maintained a transfer agent and registrar for all such Registrable Securities covered by such registration statement not later than the effective date of such registration statement;

(i) enter into such customary agreements (including, if applicable, an underwriting agreement) and take such other actions as the Holders of a majority of the Registrable Securities or the Major Holder participating in such offering shall reasonably request in order to expedite or facilitate the disposition of such Registrable Securities. The Holders of the Registrable Securities which are to be distributed by such underwriters shall be parties to such underwriting agreement and may, at their option, require that the Company make to and for the benefit of such Holders the representations, warranties and covenants of the Company which are being made to and for the benefit of such underwriters and which are of the type customarily provided to institutional investors in secondary offerings;

(j) use its best efforts to obtain an opinion from the Company's counsel and a "cold comfort" letter from the Company's independent public accountants in customary form and covering such matters as are customarily covered by such opinions and "cold comfort" letters delivered to underwriters in underwritten public offerings, which opinion and letter shall be reasonably satisfactory to the underwriter, if any, and to the Major Holder participating in such offering, and furnish to each Holder participating in the offering and to each underwriter, if any, a copy of such opinion and letter addressed to such Holder or underwriter;

(k) deliver promptly to each Holder participating in the offering and each underwriter, if any, copies of all correspondence between the SEC and the Company, its counsel or auditors and all memoranda relating to discussions with the SEC or its staff with respect to the registration statement, other than those portions of any such memoranda which contain information subject to attorney-client privilege with respect to the Company, and, upon receipt of such confidentiality agreements as the Company may reasonably request, make reasonably available for inspection by any seller of such

Registrable Securities covered by such registration statement, by any underwriter, if any, participating in any disposition to be effected pursuant to such registration statement and by any attorney, accountant or other agent retained by any such seller or any such underwriter, all pertinent financial and other records, pertinent corporate documents and properties of the Company, and cause all of the Company's officers, directors and employees to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with such registration statement;

(l) use its best efforts to obtain the withdrawal of any order suspending the effectiveness of the registration statement;

(m) provide a CUSIP number for all Registrable Securities, not later than the effective date of the registration statement;

(n) make reasonably available its employees and personnel and otherwise provide reasonable assistance to the underwriters (taking into account the needs of the Company's businesses and the requirements of the marketing process) in the marketing of Registrable Securities in any underwritten offering;

(o) promptly prior to the filing of any document which is to be incorporated by reference into the registration statement or the prospectus (after the initial filing of such registration statement) provide copies of such document to counsel for the selling holders of Registrable Securities and to each managing underwriter, if any, and make the Company's representatives reasonably available for discussion of such document and make such changes in such document concerning the selling holders prior to the filing thereof as counsel for such selling holders or underwriters may reasonably request;

(p) furnish to the Major Holder participating in the offering and the managing underwriter, without charge, at least one signed copy, and to each other Holder participating in the offering, without charge, at least one photocopy of a signed copy, of the registration statement and any post-effective amendments thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits (including those incorporated by reference);

(q) cooperate with the selling Holders of Registrable Securities and the managing underwriter, if any, to facilitate the timely preparation and delivery of certificates not bearing any restrictive legends representing the Registrable Securities to be sold, and cause such Registrable Securities to be issued in such denominations and registered in such names in accordance with the underwriting agreement prior to any sale of Registrable Securities to the underwriters or, if not an underwritten offering, in accordance with the instructions of the selling Holders of Registrable Securities at least three business days prior to any sale of Registrable Securities and instruct any transfer

agent and registrar of Registrable Securities to release any stop transfer orders in respect thereof; and

(r) take all such other commercially reasonable actions as are necessary or advisable in order to expedite or facilitate the disposition of such Registrable Securities.

(s) take no direct or indirect action prohibited by Regulation M under the Exchange Act; provided, however, that to the extent that any prohibition is applicable to the Company, the Company will take such action as is necessary to make any such prohibition inapplicable.

The Company may require as a condition precedent to the Company's obligations under this Section 2.4 that each seller of Registrable Securities as to which any registration is being effected furnish the Company such information regarding such seller and the distribution of such securities as the Company may from time to time reasonably request provided that such information is necessary for the Company to consummate such registration and shall be used only in connection with such registration.

Each Holder of Registrable Securities agrees that upon receipt of any notice from the Company of the happening of any event of the kind described in clause (v) of paragraph (e) of this Section 2.4, such Holder will discontinue such Holder's disposition of Registrable Securities pursuant to the registration statement covering such Registrable Securities until such Holder's receipt of the copies of the supplemented or amended prospectus contemplated by paragraph (e) of this Section 2.4 and, if so directed by the Company, will deliver to the Company (at the Company's expense) all copies, other than permanent file copies, then in such Holder's possession of the prospectus covering such Registrable Securities that was in effect at the time of receipt of such notice. In the event the Company shall give any such notice, the applicable period mentioned in paragraph (b) of this Section 2.4 shall be extended by the number of days during such period from and including the date of the giving of such notice to and including the date when each seller of any Registrable Securities covered by such registration statement shall have received the copies of the supplemented or amended prospectus contemplated by paragraph (e) of this Section 2.4.

If any such registration statement or comparable statement under "blue sky" laws refers to any Holder by name or otherwise as the Holder of any securities of the Company, then such Holder shall have the right to require
(i) the insertion therein of language, in form and substance reasonably satisfactory to such Holder and the Company, to the effect that the holding by such Holder of such securities is not to be construed as a recommendation by such Holder of the investment quality of the Company's securities covered thereby and that such holding does not imply that such Holder will assist in

meeting any future financial requirements of the Company, or (ii) in the event that such reference to such Holder by name or otherwise is not in the judgment of the Company, as advised by counsel, required by the Securities Act or any similar federal statute or any state "blue sky" or securities law then in force, the deletion of the reference to such Holder.

2.5. Registration Expenses.

(a) "Expenses" shall mean any and all fees and expenses incident to the Company's performance of or compliance with this Article 2, including, without limitation: (i) SEC, stock exchange or NASD registration and filing fees and all listing fees and fees with respect to the inclusion of securities in Nasdaq National Market, (ii) fees and expenses of compliance with state securities or "blue sky" laws and in connection with the preparation of a "blue sky" survey, including without limitation, reasonable fees and expenses of blue sky counsel, (iii) printing and copying expenses, (iv) messenger and delivery expenses, (v) expenses incurred in connection with any road show, (vi) fees and disbursements of counsel for the Company, (vii) with respect to each registration, the fees and disbursements of one counsel for the selling Holder(s) (selected by the Initiating Holder, in the case of a registration pursuant to Section 2.1, and selected by the Major Holder, in the case of a registration pursuant to Section 2.2), (viii) fees and disbursements of all independent public accountants (including the expenses of any audit and/or "cold comfort" letter) and fees and expenses of other persons, including special experts, retained by the Company, (ix) fees and expenses payable to a Qualified Independent Underwriter (as such term is defined in Schedule E to the By-Laws of the NASD) and (x) any other fees and disbursements of underwriters, if any, customarily paid by issuers or sellers of securities (collectively, "Expenses").

(b) The Company shall pay all Expenses with respect to any Demand Registration pursuant to Section 2.1 and any piggyback registrations pursuant to Section 2.2.

(c) Notwithstanding the foregoing, (x) the provisions of this
Section 2.5 shall be deemed amended to the extent necessary to cause these expense provisions to comply with "blue sky" laws of each state in which the offering is made and (y) in connection with any registration hereunder, each Holder of Registrable Securities being registered shall pay all underwriting discounts and commissions and any transfer taxes, if any, attributable to the sale of such Registrable Securities, pro rata with respect to payments of discounts and commissions in accordance with the number of shares sold in the offering by such Holder, and (z) the Company shall, in the case of all registrations under this Article 2, be responsible for all its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties).

2.6. Certain Limitations on Registration Rights.

In the case of any registration under Section 2.1 pursuant to an underwritten offering, or in the case of a registration under Section 2.2 if the Company has determined to enter into an underwriting agreement in connection therewith, all securities to be included in such registration shall be subject to an underwriting agreement and no person may participate in such registration unless such person agrees to sell such person's securities on the basis provided therein and completes and executes all reasonable questionnaires, and other documents (including custody agreements and powers of attorney) which must be executed in connection therewith, and provides such other information to the Company or the underwriter as may be necessary to register such Person's securities.

2.7. Limitations on Sale or Distribution of Other Securities.

(a) Each Holder of Registrable Securities agrees that, (i) to the extent requested in writing by a managing underwriter, if any, of an IPO or any registration effected pursuant to Section 2.1, not to sell, transfer or otherwise dispose of, including any sale pursuant to Rule 144 under the Securities Act, any Common Stock, or any other equity security of the Company or any security convertible into or exchangeable or exercisable for any equity security of the Company (other than as part of such underwritten public offering) during the time period reasonably requested by the managing underwriter, not to exceed 180 days (and the Company hereby also so agrees (except that the Company may effect any sale or distribution of any such securities pursuant to a registration on Form S-4 (if reasonably acceptable to such managing underwriter) or Form S-8, or any successor or similar form which is then in effect or upon the conversion, exchange or exercise of any then outstanding Common Stock Equivalent) to use its reasonable best efforts to cause each holder of any equity security or any security convertible into or exchangeable or exercisable for any equity security of the Company purchased from the Company at any time other than in a public offering so to agree), and
(ii) to the extent requested in writing by a managing underwriter of any underwritten public offering effected by the Company for its own account (other than the IPO) it will not sell any Common Stock (other than as part of such underwritten public offering) during the time period reasonably requested by the managing underwriter, which period shall not exceed 90 days.

(b) The Company hereby agrees that, if it shall previously have received a request for registration (other than a shelf registration) pursuant to Section 2.1 or 2.2, and if such previous registration shall not have been withdrawn or abandoned, the Company shall not sell, transfer, or otherwise dispose of, any Common Stock, or any other equity security of the Company or any security convertible into or exchangeable or exercisable for any equity security of the Company (other than as part of such

underwritten public offering, a registration on Form S-4 or Form S-8 or any successor or similar form which is then in effect or upon the conversion, exchange or exercise of any then outstanding Common Stock Equivalent), until a period of 90 days shall have elapsed from the effective date of such previous registration; and the Company shall so provide in any registration rights agreements hereafter entered into with respect to any of its securities.

2.8. No Required Sale.

Nothing in this Agreement shall be deemed to create an independent obligation on the part of any Holder to sell any Registrable Securities pursuant to any effective registration statement.

2.9. Indemnification.

(a) In the event of any registration of any securities of the Company under the Securities Act pursuant to this Article 2, the Company will, and hereby does, indemnify and hold harmless, to the fullest extent permitted by law, each Holder of Registrable Securities, its directors, officers, fiduciaries, employees and stockholders or general and limited partners (and the directors, officers, employees and stockholders thereof), each other Person who participates as an underwriter or a Qualified Independent Underwriter, if any, in the offering or sale of such securities, each officer, director, employee, stockholder, fiduciary, managing director, agent, affiliates, consultants, representatives, successors, assigns or partner of such underwriter or Qualified Independent Underwriter, and each other Person, if any, who controls such seller or any such underwriter within the meaning of the Securities Act, against any and all losses, claims, damages or liabilities, joint or several, actions or proceedings (whether commenced or threatened) and expenses (including reasonable fees of counsel and any amounts paid in any settlement effected with the Company's consent, which consent shall not be unreasonably withheld or delayed) to which each such indemnified party may become subject under the Securities Act or otherwise in respect thereof (collectively, "Claims"), insofar as such Claims arise out of or are based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any registration statement under which such securities were registered under the Securities Act or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or summary prospectus or any amendment or supplement thereto, together with the documents incorporated by reference therein, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (iii) any violation by the Company of any federal, state or common law rule or regulation

applicable to the Company and relating to action required of or inaction by the Company in connection with any such registration, and the Company will reimburse any such indemnified party for any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim as such expenses are incurred; provided, however, that the Company shall not be liable to any such indemnified party in any such case to the extent such Claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact made in such registration statement or amendment thereof or supplement thereto or in any such prospectus or any preliminary, final or summary prospectus in reliance upon and in conformity with written information furnished to the Company by or on behalf of such indemnified party specifically for use therein. Such indemnity and reimbursement of expenses shall remain in full force and effect regardless of any investigation made by as on behalf of such indemnified party and shall survive the transfer of such securities by such seller.

(b) Each Holder of Registrable Securities that are included in the securities as to which any registration under Section 2.1 or 2.2 is being effected (and, if the Company requires as a condition to including any Registrable Securities in any registration statement filed in accordance with
Section 2.1 or 2.2, any underwriter and Qualified Independent Underwriter, if any) shall, severally and not jointly, indemnify and hold harmless (in the same manner and to the same extent as set forth in paragraph (a) of this Section 2.9) to the extent permitted by law the Company, its officers and directors, each Person controlling the Company within the meaning of the Securities Act and all other prospective sellers and their respective directors, officers, fiduciaries, managing directors, employees, agents, affiliates, consultants, representatives, successors, assigns, general and limited partners, stockholders and respective controlling Persons with respect to any untrue statement or alleged untrue statement of any material fact in, or omission or alleged omission of any material fact from, such registration statement, any preliminary, final or summary prospectus contained therein, or any amendment or supplement thereto, if such statement or alleged statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company or its representatives by or on behalf of such Holder or underwriter or Qualified Independent Underwriter, if any, specifically for use therein and reimburse such indemnified party for any legal or other expenses reasonably incurred in connection with investigating or defending any such Claim as such expenses are incurred; provided, however, that the aggregate amount which any such Holder shall be required to pay pursuant to this Section 2.9(b) and Sections 2.9(c) and (e) shall in no case be greater than the amount of the net proceeds received by such person upon the sale of the Registrable Securities pursuant to the registration statement giving rise to such claim. Such indemnity and reimbursement of expenses shall remain in full force and effect regardless of any investigation made by or on behalf of such indemnified party and shall survive the transfer of such securities by such Holder.

(c) Indemnification similar to that specified in the preceding paragraphs (a) and (b) of this Section 2.9 (with appropriate modifications) shall be given by the Company and each seller of Registrable Securities with respect to any required registration or other qualification of securities under any state securities and "blue sky" laws.

(d) Any person entitled to indemnification under this Agreement shall notify promptly the indemnifying party in writing of the commencement of any action or proceeding with respect to which a claim for indemnification may be made pursuant to this Section 2.9, but the failure of any indemnified party to provide such notice shall not relieve the indemnifying party of its obligations under the preceding paragraphs of this Section 2.9, except to the extent the indemnifying party is materially prejudiced thereby and shall not relieve the indemnifying party from any liability which it may have to any indemnified party otherwise than under this Article 2. In case any action or proceeding is brought against an indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, unless in the reasonable opinion of outside counsel to the indemnified party a conflict of interest between such indemnified and indemnifying parties may exist in respect of such claim, to assume the defense thereof jointly with any other indemnifying party similarly notified, to the extent that it chooses, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party that it so chooses, the indemnifying party shall not be liable to such indemnified party for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that (i) if the indemnifying party fails to take reasonable steps necessary to defend diligently the action or proceeding within 20 days after receiving notice from such indemnified party that the indemnified party believes it has failed to do so; or
(ii) if such indemnified party who is a defendant in any action or proceeding which is also brought against the indemnifying party reasonably shall have concluded that there may be one or more legal defenses available to such indemnified party which are not available to the indemnifying party; or (iii) if representation of both parties by the same counsel is otherwise inappropriate under applicable standards of professional conduct, then, in any such case, the indemnified party shall have the right to assume or continue its own defense as set forth above (but with no more than one firm of counsel for all indemnified parties in each jurisdiction, except to the extent any indemnified party or parties reasonably shall have concluded that there may be legal defenses available to such party or parties which are not available to the other indemnified parties or to the extent representation of all indemnified parties by the same counsel is otherwise inappropriate under applicable standards of professional conduct) and the indemnifying party shall be liable for any expenses therefor. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or

threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (A) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (B) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.

(e) If for any reason the foregoing indemnity is unavailable or is insufficient to hold harmless an indemnified party under Sections 2.9(a),
(b) or (c), then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of any Claim in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and the indemnified party, on the other hand, with respect to such offering of securities. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or the indemnified party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. If, however, the allocation provided in the second preceding sentence is not permitted by applicable law, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative faults but also the relative benefits of the indemnifying party and the indemnified party as well as any other relevant equitable considerations. The parties hereto agree that it would not be just and equitable if contributions pursuant to this Section 2.9(e) were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentences of this Section 2.9(e). The amount paid or payable in respect of any Claim shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. Notwithstanding anything in this section 2.9(e) to the contrary, no indemnifying party (other than the Company) shall be required pursuant to this section 2.9(e) to contribute any amount in excess of the net proceeds received by such indemnifying party from the sale of Registrable Securities in the offering to which the losses, claims, damages or liabilities of the indemnified parties relate, less the amount of any indemnification payment made by such indemnifying party pursuant to Sections 2.9(b) and (c).

(f) The indemnity agreements contained herein shall be in addition to any other rights to indemnification or contribution which any indemnified party may have pursuant to law or contract and shall remain operative and in full force and effect

regardless of any investigation made or omitted by or on behalf of any indemnified party and shall survive the transfer of the Registrable Securities by any such party.

(g) The indemnification and contribution required by this
Section 2.9 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or expense, loss, damage or liability is incurred.

2.10 Blackout Periods for Shelf Registrations.

(a) At any time when a shelf registration effected pursuant to
Section 2 relating to the Registrable Securities is effective, upon written notice from the Company to the Holders participating in the registration that the Company determines in the good faith judgment of the Board of Directors of the Company that such Holders' sale of the Registrable Securities pursuant to the shelf registration would require disclosure of material information which the Company has a bona fide business purpose for preserving as confidential and the disclosure of which would have a material adverse effect on the Company or the Company is unable to comply with SEC requirements (an "Information Blackout"), such Holders shall suspend sales of the Registrable Securities pursuant to such shelf registration until the earlier of (i) the date upon which such material information is disclosed to the public or ceases to be material,
(ii) 90 days after the Board of Directors of the Company makes such good faith determination or (iii) such time as the Company notifies Holders that sales pursuant to such shelf registration may be resumed (the number of days from such suspension of sales of the Holders until the day when such sales may be resumed hereunder is hereinafter called a "Sales Blackout Period").

(b) If there is an Information Blackout and the Holders do not notify the Company in writing of their desire to cancel such shelf registration, the period set forth in Section 2.4(b) shall be extended for a number of days equal to the number of days in the Sales Blackout Period.

3. Underwritten Offerings.

3.1. Requested Underwritten Offerings. If requested by the underwriters for any underwritten offering by the Holders pursuant to a registration requested under Section 2.1, the Company shall enter into a customary underwriting agreement with the underwriters. Such underwriting agreement shall be satisfactory in form and substance to the Initiating Holder and shall contain such representations and warranties by, and such other agreements on the part of, the Company and such other terms as are generally prevailing in agreements of that type, including, without limitation, indemnities and contribution agreements on substantially the same terms as those contained herein. Any Holder participating in the offering shall be a party to such underwriting agreement and may, at its option, require that any or all of the representations and warranties by, and the

other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the benefit of such Holder and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement be conditions precedent to the obligations of such Holder; provided, however, that the Company shall not be required to make any representations or warranties with respect to written information specifically provided by a selling Holder for inclusion in the registration statement. Such underwriting agreement shall also contain such representations and warranties by the participating Holders with respect to title and ownership of shares as are customary in agreements of that type.

3.2. Piggyback Underwritten Offerings. In the case of a registration pursuant to Section 2.2 hereof, if the Company shall have determined to enter into an underwriting agreement in connection therewith, all of the Holders' Registrable Securities to be included in such registration shall be subject to such underwriting agreement. Any Holder participating in such registration may, at its option, require that any or all of the representations and warranties by, and the other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the benefit of such Holder and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement be conditions precedent to the obligations of such Holder. Such underwriting agreement shall also contain such representations and warranties by the participating Holders as are customary in agreements of that type, on substantially the same terms as those contained herein.

4. General.

4.1. Adjustments Affecting Registrable Securities. The Company agrees that it shall not effect or permit to occur any combination or subdivision of shares which would adversely affect the ability of the Holder of any Registrable Securities to include such Registrable Securities in any registration contemplated by this Agreement or the marketability of such Registrable Securities in any such registration. The Company agrees that it will take all reasonable steps necessary to effect a subdivision of shares if in the reasonable judgment of (a) the Initiating Holder of a Demand Registration Request or (b) the managing underwriter for the offering in respect of such Demand Registration Request, such subdivision would enhance the marketability of the Registrable Securities. Each Holder agrees to vote all of its shares of capital stock in a manner, and to take all other actions necessary, to permit the Company to carry out the intent of the preceding sentence including, without limitation, voting in favor of an amendment to the Company's Certificate of Incorporation in order to increase the number of authorized shares of capital stock of the Company.

4.2. Rule 144. If the Company shall have filed a registration statement pursuant to the requirements of Section 12 of the Exchange Act or a registration statement pursuant

to the requirements of the Securities Act in respect of the Common Stock or securities of the Company convertible into or exchangeable or exercisable for Common Stock, the Company covenants that (i) so long as it remains subject to the reporting provisions of the Exchange Act, it will timely file the reports required to be filed by it under the Securities Act or the Exchange Act (including, but not limited to, the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144 under the Securities Act), and (ii) will take such further action as any Holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by (A) Rule 144 under the Securities Act, as such Rule may be amended from time to time, or (B) any similar rule or regulation hereafter adopted by the SEC. Upon the request of any Holder of Registrable Securities, the Company will deliver to such Holder a written statement as to whether it has complied with such requirements.

4.3. Nominees for Beneficial Owners. If Registrable Securities are held by a nominee for the beneficial owner thereof, the beneficial owner thereof may, at its option, be treated as the Holder of such Registrable Securities for purposes of any request or other action by any Holder or Holders of Registrable Securities pursuant to this Agreement (or any determination of any number or percentage of shares constituting Registrable Securities held by any Holder or Holders of Registrable Securities contemplated by this Agreement), provided that the Company shall have received assurances reasonably satisfactory to it of such beneficial ownership.

4.4 Amendments and Waivers. The terms and provisions of this Agreement may be modified or amended, or any of the provisions hereof waived, temporarily or permanently, pursuant to the written consent of the Company and Cabot.

4.5. Notices. Except as otherwise provided in this Agreement, all notices, requests, consents and other communications hereunder to any party shall be delivered in person or by telecopy (with a confirmatory copy sent by a different means within three business days of such notice), nationally recognized overnight courier or first class registered or certified mail, return receipt requested, postage prepaid, addressed to such party at the address set forth below or such other address as may hereafter be designated in writing by such party to the other parties:

(i) if to the Company, to:

Cabot Microelectronics Corporation 870 North Commons Drive Aurora, IL 60504

Telecopy: (630) 375-5593 Attention: President

(ii) if to Cabot, to:

Cabot Corporation 75 State Street Boston, MA 02109 Telecopy: (617) 342-6281 Attention: Chief Financial Officer

with copies to:

Fried, Frank, Harris, Shriver & Jacobson One New York Plaza New York, New York 10004 Telecopy: (212) 859-8589 Attention: Thomas W. Christopher

All such notices, requests, consents and other communications shall be deemed to have been given when received.

4.6. Miscellaneous.

(a) This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and the respective successors, personal representatives and assigns of the parties hereto, whether so expressed or not. If any Person shall acquire Registrable Securities from any Holder, in any manner, whether by operation of law or otherwise, such transferee shall promptly notify the Company and such Registrable Securities acquired from such Holder shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities such Person shall be entitled to receive the benefits of and be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement. If the Company shall so request, any such successor or assign shall agree in writing to acquire and hold the Registrable Securities acquired from such Holder subject to all of the terms hereof. If any Holder shall acquire additional Registrable Securities, such Registrable Securities shall be subject to all of the terms, and entitled to all the benefits, of this Agreement.

(b) This Agreement (with the documents referred to herein or delivered pursuant hereto) embodies the entire agreement and understanding between the parties

hereto and supersedes all prior agreements and understandings relating to the subject matter hereof.

(c) This Agreement shall be construed and enforced in accordance with and governed by the laws of the State of New York without giving effect to the conflicts of law principles thereof.

(d) The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All section references are to this Agreement unless otherwise expressly provided.

(e) This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

(f) Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction.

(g) The parties hereto acknowledge that there would be no adequate remedy at law if any party fails to perform any of its obligations hereunder, and accordingly agree that each party, in addition to any other remedy to which it may be entitled at law or in equity, shall be entitled to injunctive relief, including specific performance, to enforce such obligations without the posting of any bond, and, if any action should be brought in equity to enforce any of the provisions of this Agreement, none of the parties hereto shall raise the defense that there is an adequate remedy at law.

(h) Each party hereto shall do and perform or cause to be done and performed all such further acts and things and shall execute and deliver all such other agreements, certificates, instruments, and documents as any other party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

4.7. Prior Agreements. Each of the Holders and the Company hereby agrees that any agreement previously entered into by it pursuant to which the Company granted to it any registration rights shall be superseded by this Agreement and each such agreement (and any rights such Holder has pursuant to such agreement) shall be terminated, null and void and no longer in effect.

4.8. No Inconsistent Agreements. The rights granted to the holders of Registrable Securities hereunder do not in any way conflict with and are not inconsistent with any other agreements to which the Company is a party or by which it is bound. Without the prior written consent of Cabot, neither the Company nor any Holder will, on or after the date of this Agreement, enter into any agreement with respect to its securities which is inconsistent with the rights granted in this Agreement or otherwise conflicts with the provisions hereof, other than any lock-up agreement with the underwriters in connection with any registered offering effected hereunder, pursuant to which the Company shall agree not to register for sale, and the Company shall agree not to sell or otherwise dispose of, Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, for a specified period following the registered offering. The Company further agrees that if any other registration rights agreement entered into after the date of this Agreement with respect to any of its securities contains terms which are more favorable to, or less restrictive on, the other party thereto than the terms and conditions contained in this Agreement are (insofar as they are applicable) to Cabot, then the terms and conditions of this Agreement shall immediately be deemed to have been amended without further action by the Company or any of the holders of Registrable Securities so that Cabot shall be entitled to the benefit of any such more favorable or less restrictive terms or conditions.

4.9 Effective Time. This Agreement shall become effective upon the closing of the Company's IPO.

IN WITNESS WHEREOF, the parties hereto have duly executed this agreement as of the date first above written.

CABOT MICROELECTRONICS CORPORATION

By:  /s/ Matthew Neville
     ------------------------------
     Name:  Matthew Neville
     Title: President and
            Chief Executive Officer

CABOT CORPORATION

By:  /s/ Samuel W. Bodman
     ------------------------------
     Name:  Samuel W. Bodman
     Title: Chairman and
            Chief Executive Officer

Exhibit 10.11

The omitted portions indicated by brackets have been separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406, promulgated under the Securities Act of 1933, as amended.

                                                   Agreement #:          C-06438
                                                   Effective Date: FEB. 18, 1999
                                                  Expiration Date:  DEC. 31,2001
                                                     CNDA #:               17452


BUYER:      Intel Corporation (and all Intel divisions and subsidiaries,
            hereinafter "BUYER" or "INTEL")
            Intel Corporation
            2200 Mission College Blvd
            Santa Clara, CA 95052-8119


SUPPLIER:   Cabot Corporation (hereinafter "SUPPLIER")
            500 Commons Drive
            Aurora, IL 60504

                                        X         Terms and Conditions of Purchase Agreement - Goods
Addenda attached here to and            X    A    Product Description and Price Schedule
Incorporated herein by reference        X    B    Key Contacts & Intel Fab Locations
(Mark "X" where applicable.)            X    C    Quality Requirements
                                        X    D    Volume Commitments
                                             E
                                             F

Buyer will purchase and Supplier will sell certain Items in accordance with the Terms and Conditions and Addenda attached hereto. All Purchase Orders issued to Supplier by Buyer during the term of this Agreement shall be governed only by the Terms and Conditions of this Agreement notwithstanding any preprinted terms and conditions on Supplier's acknowledgment or Buyer's Purchase Order. Any additional or different terms in documents exchanged by the parties subsequent to execution of this agreement are hereby deemed to be material alterations and notice of objection to and rejection of them is hereby given.

INTEL CORPORATION                                 SUPPLIER

By: /s/  Mumtaz Ahmed                             By: /s/  Matthew Neville
    --------------------------                        --------------------------
Signature                                         Signature

Mumtaz Ahmed                                      Matthew Neville
Printed Name                                      Printed Name

Commodity Manager                                 GM & VP
Title                                             Title

2/18/99                                           2/18/99
Date                                              Date

TERMS AND CONDITIONS OF PURCHASE AGREEMENT - CHEMICALS/GASES

1. DEFINITIONS

A. "Release" means Buyer's authorization to ship in accordance with the Buyer's Purchase Order, and authorizing Supplier to ship a definite quantity of Items to a specified schedule. The Release is contained in the Purchase Order sent to Supplier.

B. "Items" means the goods which Supplier is to provide to Buyer as set forth on Addendum A. Any Item which is custom made for Buyer shall be indicated by an asterisk (*) on such Addenda A.

C. "Estimated Usage" or "Forecast" is the quantity Buyer reasonably expects to Release, however, Buyer shall not be obligated to Release such quantities of Items.

D. "Purchase Order" is Buyer's document setting forth specific line Items ordered and Release information.

E. "CIF" means "Cost, Insurance and Freight (named port of shipment)." Reference Incoterms 1990.

F. "DDP" means "Delivered Duty Paid (named place of destination)." Reference Incoterms 1990.

G. "DDU" means "Delivered Duty Unpaid (named place of destination)." Reference Incoterms 1990.

H. "FMO" is Fab Materials Operation (a department within Intel Corporation).

I. "FOB" means "Freight on Board (named port of shipment)." Reference Incoterms 1990.

J. "FCA" means "Free Carrier (named place of destination)". Reference Incoterms 1990.

2. TERM OF AGREEMENT

A. The term of this Agreement shall begin on the Effective Date and continue to the Expiration Date, unless renewed pursuant to the terms of this Section. After the initial term, this Agreement shall be automatically renewed from year to year (for one-year periods) without action by either party, unless terminated pursuant to Section 5 of this Agreement. At Buyer's option, Items may be scheduled for delivery up to three (3) months following expiration or termination of this Agreement.

B. This Agreement shall be effective to all Intel manufacturing facilities in the U.S. and the non-U.S. facilities identified in Addenda hereto.

3. PRICING

A. Prices of Items are as set forth in Addendum A, and may only be modified by mutual agreement. Supplier will publish newly negotiated prices to corporate representative and all Site buyers within 10 days of signed agreement.

B. For any Item of which Supplier supplied Buyer with [ ]% or more of Buyer's requirements, as described in Addendum D, during the previous calendar year, Supplier agrees that the price for such Item shall always be Supplier's lowest net price charged any customer for like volumes of such Item. If the net price charged to Buyer for such is greater than that charged to another customer of Supplier for like volumes, Supplier shall adjust its price to Buyer to the lower price for as long as Supplier continues to offer such lower price to another customer. In addition, to the extent Buyer was charged a higher price during a period that Supplier was selling like volumes of such Item to another customer at a lower price, Supplier shall refund to Buyer the difference in the purchase price paid by Buyer and such lower price.

C. In the event Supplier offers any Item of which Supplier supplied Buyer with
[ ]% or more of Buyer's requirements as described in Addendum D during the previous calendar year at a lower price (taking into account volume discounts) either as a general price drop or only to some customer(s) for any reason, Supplier shall immediately inform Buyer of this price.

D. Applicable taxes and other charges such as duties, customs, tariffs, imposts and government imposed surcharges, and freight shall be stated separately on Supplier's invoice.

E. Additional costs, except those described in Section 3(D) or in Addenda A or D, will not be reimbursed without Buyer's prior written approval.

F. Buyer reserves the right to have Supplier's records inspected and audited only by an independent third party auditor to ensure compliance with section 3B of this Agreement. At Buyer's option or upon Supplier's written demand, such audit will be performed by an independent third party at Buyer's expense. However, if Supplier is found to not be complying with section 3B of this Agreement in any way, Supplier shall reimburse Buyer for all costs associated with the audit. The results of such audit shall be kept confidential by the auditor, and only Supplier's failures to abide by the obligations of this Agreement shall be reported to Buyer.

G. If a new product not included in Addendum A is to be purchased regularly, its price will be negotiated by a corporate representative at the time of initial purchase. If the product is for test purposes only at a given site, its price may be established between Supplier and a Sitebuyer. Said price shall be in effect until such time as an Intel part number is created, at which time a corporate-wide price will be negotiated by a corporate representative.

H. Supplier will publish quarterly updates of Addendum A to FMO, all Buyer's Site Chemicals buyers and Buyer's Accounts Payable department, including new chemicals, their negotiated prices, supplier part numbers, Intel part numbers and any other changes. Quarterly updates of Addendum A will be issued on 1/30, 4/30, 7/30 and 10/30 of each year. Names and addresses of all parties to receive the updates will be provided and updated by Site buyer (see Addendum B).

I. U.S. and non-U.S. prices will be fixed in U.S. dollars regardless of the Item country of origin or destination. Buyer retains the right to buy from Supplier or any subsidiaries of Supplier in U.S. dollars.

J. The cost of containers, both returnable and disposable, diptubes and any required accessories will be included in the cost of the chemical

K. Warehousing costs will be separate from this Agreement and will be billed separately.

4. INVOICING AND PAYMENT

A. Any applicable prompt payment discounts will be computed from the latest of: (i) the scheduled delivery date; (ii) the date of actual delivery; or
(iii) the date a properly filled out original invoice or packing list is received. Payment is made when Buyer's check is mailed or EDI funds transfer initiated. Buyer shall make payment within forty-five (45) days of receipt of the proper original invoice or packing list.

B. Original invoices or packing lists shall be submitted and shall include:
full legal company name, payment terms, freight terms, tax status and rate, purchase agreement number from the Purchase Order, purchase order number, line Item number, Release number, part number, complete bill to address, description of Items, quantities, unit price and extended totals. Buyer's payment shall not constitute acceptance. Invoice must match Buyer's PO and packing slip exactly including unit of measure.

C. Supplier shall provide to Buyer's Accounts Payable, and update as necessary, the names and phone numbers of a contact in Accounts Receivable.

D. All international shipments must be accompanied by original invoice.

E. Supplier will invoice Buyer for material and services no later than 120 days after delivery.

5. TERMINATION

This Agreement may not be terminated by either party prior to the Expiration Date, except upon material breach by the other party. The Agreement may be terminated by

either party on or after the Expiration Date by delivering to the other party written notice of termination at least one year prior to the date of such termination.

6. CONTINGENCIES

Neither party shall be responsible for its failure to perform due to causes beyond its reasonable control such as acts of God, fire, theft, war, riot, embargoes or acts of civil or military authorities. If delivery is to be delayed by such contingencies, Supplier shall immediately notify Buyer in writing and Buyer may either: (i) extend time of performance; or (ii) terminate all or part of the uncompleted portion of the Purchase Order at no cost to Buyer.

7. DELIVERY, RELEASES AND SCHEDULING

A. Any Forecasts provided by Buyer are for planning purposes only and do not constitute a Release or other commitment by Buyer.

B. [Left intentionally blank]

C. Supplier shall notify Buyer in writing within two (2) business days of receipt of Buyer's Purchase Order if Supplier is unable to make any scheduled delivery and state the reasons therefor. The absence of such notice constitutes acceptance of the Purchase Order and commitment to the Release terms.

D. Supplier shall not deliver Items earlier than five (5) business days prior to agreed scheduled delivery dates and Buyer may return early, excess, or non-conforming shipments at Supplier's risk and expense.

E. Buyer may reschedule or cancel any Release in whole or in part prior to the Release date at no additional charge.

F. Buyer may place any portion of a Release on hold by notice which shall take effect immediately upon receipt. Releases placed on hold will be rescheduled or canceled within a reasonable time.

G. Supplier shall not deliver Items until such Items are specified in an issued Purchase Order which contains specific Release dates for specific Items.

H. Purchase orders will specify the destination date at Buyer dock or designated warehouse.

I. Supplier must notify FMO, Accounts Payable and all Site Chemical buyers immediately in writing of any changes, including changes in delivery schedules, part numbers, contact persons and the party to be invoiced.

J. Supplier must provide FMO with a Certificate of Analysis (C of A) or sample for each lot to be shipped, as directed in the most current appropriate Intel Specification (Addendum C).

K. Buyer may return any standard Item in same condition as received within [ ] days of receipt. Buyer will pay return freight and disposal costs, if necessary (Disposal costs paid only if the product conformed to all required specifications in place). Reimbursement for Items returned will be made by credit memo.

L. Supplier shall ship all Items according to the delivery address provided on each Purchase Order submitted by Buyer.

M. Supplier shall provide and update as necessary the name and phone number of one person which Buyer's representative may contact regarding scheduling and delivery. Additionally, Supplier will provide 24-hour hotline/contact number which Buyer may contact in case of emergency.

N. Supplier agrees to maintain safety stock on specified Items as mutually agreed with Buyer's local sites. Supplier shall notify Buyer whenever safety stock falls below minimum levels and will provide a corrective action plan to replenish Items. In the event Buyer no longer intends to purchase a particular Item from Supplier for use at a particular site, Buyer shall so notify Supplier of such fact and Buyer shall purchase Buyer's minimum required safety stock of such Items at that site.

O. Supplier shall maintain an on-hand supply of emergency packaging material sufficient to meet pre-agreed requirements with Buyer's Site Chemical buyer.

8. ACCEPTANCE AND WARRANTY

A. Buyer may with reasonable advance notification inspect and test all Items at reasonable times before, during and after manufacture. If any inspection or test is made on Supplier's premises, Supplier shall provide reasonable facilities and assistance for the safety and convenience of Buyer's inspectors in such manner as shall not unreasonably hinder or delay Supplier's performance. All Items shall be received subject to Buyer's inspection, testing, approval and acceptance at Buyer's premises notwithstanding any inspection or testing at Supplier's premises or any prior payment for such Items. Items rejected by Buyer as not conforming to this Agreement or Item specifications whether provided by Buyer or furnished with the Item may be returned to Supplier at Supplier's risk and expense and, at Buyer's request shall immediately be repaired or replaced.

B. Supplier warrants that all Items furnished here under shall be new, of the grade and quality specified, conform to all agreed-to specifications, and will be free of liens and encumbrances (excluding claims of intellectual property infringement, which are the exclusive subject of Section 14). These warranties shall survive any delivery, inspection, acceptance, payment or resale of the Items. Original specifications and any subsequent modifications to those specifications shall be agreed upon by both Buyer and Supplier. SUPPLIER MAKES NO OTHER REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AS TO MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER MATTER WITH RESPECT TO THE ITEMS, WHETHER USED ALONE OR IN COMBINATION WITH OTHER SUBSTANCES, EVEN IF THE PURPOSES OR USES OF SUCH PRODUCTS ARE KNOWN BY SUPPLIER.

C. During the Items' specified shelf life, at Buyer's option, Supplier shall promptly repair, replace or refund the purchase price of all Items not conforming to the foregoing warranties, and shall also refund the cost of return shipping of such Items. Supplier will bear the risk of loss of such Items while in transit. Supplier's warranty liability for damages arising from each "Non-Conformance Event" shall [ ]. Furthermore, in no event shall Supplier's [ ]. As used herein, "Non-Conformance Event" shall mean the receipt by Buyer of a lot of Items which are not in conformity with the warranty given in Section 8B above. IN NO EVENT SHALL SELLER BE RESPONSIBLE OR LIABLE FOR ANY SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING IN WARRANTY UNDER THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. The
[ ]contained in this Section 8 is separate and independent from the [ ] contained in Section 14, and the amount of liability imposed under one of these Sections does not limit or restrict the amount of liability imposed under another Section. NOTHING IN THIS SECTION IS INTENDED TO PLACE A LIMITATION ON EITHER PARTY'S LIABILITY IN TORT FOR PERSONAL INJURY.

D. Freight charges for returned non-conforming Items shall be paid by Supplier with the understanding that returns must be authorized in accordance with Supplier's return authorization procedures. Returns must be authorized by Supplier within 10 days of Buyer's request. Credit for returned Items will be issued within 30 days of notification by Buyer.

E. Notwithstanding anything to the contrary contained in this Agreement, Supplier represents and warrants to Buyer that there will be no disruption in the supply of those goods and/or services which are under the direct control of the Supplier as a result of or due to the date change from and between December, 1999, and January, 2000, nor due to the year 2000 being a leap year. Supplier does not provide any such warranty for disruptions caused by those goods and/or services which are not under the Supplier's direct control. As used herein, "direct control" refers to goods and/or services which the Supplier actively manages by contract and/or owns. Furthermore, in no event shall

Seller's total and aggregate liability under such warranty exceed $500,000 over the term of this Agreement

9. PRODUCT SPECIFICATIONS/IDENTIFICATION/ ERRATA

A. Supplier shall not modify the specifications for Items without Buyer's written consent. Supplier shall notify FMO and all Site Chemical buyers immediately in writing of any change in Supplier's part number, in the manufacturing process, packaging or description for any Item sold to Buyer at least ninety (90) days in advance of any changes. Such notice shall also be included in the quarterly update mentioned in Section 3 (I).

B. Supplier shall cooperate with Buyer to provide configuration control and traceability systems for Items supplied hereunder.

C. Items must comply with Buyer's raw material specifications (Intel Specification 07-400).

D. As long as Buyer is purchasing a particular Item, Supplier shall notify FMO and all Site Chemical buyers at least one year in advance of expected discontinuance of that Item. Exception: In the event of changes or discontinuation required by governmental order or requirement, Supplier shall notify Buyer in writing immediately. Notification of any change in product specification must follow Intel's " Materials Change Control Procedure." (Intel Specification 07-120).

E. Where an existing agreed-to Intel Specification (Addendum C) is updated, the updated Specification must be agreed to by Buyer and Supplier before it will be in effect.

10. CONTAINERS AND DIPTUBES

A. All necessary chemical containers, packaging and diptubes will be provided by Supplier and included in the cost of the Item.

B. All containers and diptubes shall be inspected by Supplier before each use and repaired or replaced as necessary.

C. At all times, ownership and title of containers and diptubes will remain with the Supplier.

D. Buyer will not be responsible for any additional charges for acquisition, termination or disposal of containers or diptubes.

E. In the event that containers or diptubes become damaged through neglect or misuse by Buyer, Buyer will reimburse Supplier an amount agreed upon and pro-rated based upon useful life.

F. All packaging including quartz, stainless steel, bottles, drums and ICBs, shall be equipped with tamper evident seals.

11 PACKING AND SHIPMENT

A. Shipments to Israel: Delivery terms for Israel will be DDP Intel, Jerusalem. Supplier fulfills its obligation to deliver when Items are made available at Buyer's dock or designated warehouse. Supplier will bear all risks, liabilities and costs involved in bringing the Items thereto. Buyer will ship empty containers to the point of manufacture in a timely manner.

B. Shipments to Ireland: Delivery terms for Ireland will be DDU Intel, Leixlip. Supplier fulfills its obligation to deliver when Items are made available at Buyer's dock or designated warehouse. Supplier will bear all risks, liabilities and costs involved in bringing the Items thereto, excluding duties, taxes and other official charges payable upon importation. Buyer will ship empty containers to the point of manufacture in a timely manner.

C. For all other Intel Factories, both U.S. and non-U.S., Items shall be DDP Buyer's dock or as otherwise specified in the Release. Buyer will ship empty containers to the point of manufacture in a timely manner. All Items shall be prepared for shipment in a manner which: (i) follows good commercial practice; (ii) is acceptable to common carriers for shipment at the lowest rate; and (iii) is adequate to ensure safe arrival. Supplier shall mark all containers with necessary lifting, handling and shipping information, purchase order number, date of shipment and the names of the Buyer and Supplier. Buyer shall

notify Supplier of the method of shipment and expected delivery date. If no instructions are given, Supplier shall select the most cost effective carrier, given the time constraints known to Supplier. Supplier shall ship only the quantity of Items specified in the Release. Buyer may return at Supplier's expense any Items in excess of the quantity stated in the Release.

D. Supplier shall be responsible for all Supplier's activities through manufacture, storage, transport, and delivery of Items to Buyer. In the event that Buyer must deploy emergency, safety, or materials personnel in response to an emergency or non-compliance with Intel or regulatory procedure involving Items supplied hereunder, Buyer and Supplier will review the incident. If Buyer and Supplier agree that (i) such deployment was necessary, and (ii)Supplier's negligent act or failure to act was the proximate cause of such emergency or non-compliance, then Supplier agrees to reimburse Buyer for the out-of-pocket cost incurred by Buyer in deploying its personnel to respond to such incident. Supplier will not be responsible for costs incurred by such deployment due to Buyer's negligent act or failure to act. International shipments: Supplier will provide Buyer's representative with shipping documents as requested. Buyer's purchase orders will contain detailed shipping instructions. E. Shipment of all Items qualified for Buyer's Preship or Direct Ship Programs will be done in accordance with latest mutually accepted Intel Specification 07-402 (Intel Chemical and Gas Quality Program.).

12. OWNERSHIP AND BAILMENT RESPONSIBILITIES

A. Any specifications, drawings, schematics, technical information, data, tools, dies, patterns, masks, gauges, test equipment, and other materials furnished or paid for by Buyer shall: (i) be kept confidential; (ii) remain Buyer's property; (iii) be used by Supplier exclusively for Buyer's orders;
(iv) be clearly marked as Buyer's property and segregated when not in use;
(v) be kept in good working condition at Supplier's expense; and (vi) be shipped to Buyer promptly on demand.

B. Supplier shall insure Buyer's property and be liable for loss or damage while in Supplier's possession or control, ordinary wear and tear excepted.

13. CONFIDENTIALITY AND PUBLICITY

A. During the course of this Agreement, either party may have or may be provided access to the other's confidential information and materials. Provided such are marked in a manner reasonably intended to make the recipient aware, or the recipient is sent written notice within forty-eight
(48) hours of disclosure, that the information or materials are "Confidential", each party agrees to maintain such information in accordance with the terms of this Agreement and the CNDA referenced on the signature page of this Agreement or any applicable separate nondisclosure agreement between Buyer and Supplier. In the absence of a CNDA or other written agreement, at a minimum each party agrees to maintain such information in confidence and limit disclosure on a need to know basis, to take all reasonable precautions to prevent unauthorized disclosure, and to treat such information as it treats it's own information of a similar nature, until the information becomes publicly available through no fault of the non disclosing party. Supplier's employees who access Buyer's facilities may be required to sign a separate non-disclosure agreement prior to admittance to Buyer's facilities.

B. The parties agree that neither will disclose the existence of this Agreement, nor any of its details or the existence of the relationship created by this Agreement, to any third party without the specific, written consent of the other. If disclosure of this Agreement or any of the terms hereof is required by applicable law, rule or regulation, or is compelled by a court or governmental agency, authority or body: (i) the parties shall use all legitimate and legal means available to minimize the disclosure to third parties of the content of the Agreement, including without limitation seeking a confidential

treatment request or protective order; (ii) the disclosing party shall inform the other party at least ten (10) business days (i.e., not a Saturday, Sunday or a day on which banks are not open for business in the geographic area in which the non-disclosing party's principal office is located) in advance of the disclosure; and (iii) the disclosing party shall give the other party a reasonable opportunity to review and comment upon the disclosure, and any request for confidential treatment or a protective order pertaining thereto, prior to making such disclosure. The parties may disclose this Agreement in confidence to their respective legal counsel, accountants, bankers and financing sources as necessary in connection with obtaining services from such third parties. The obligations stated in this section shall survive the expiration or termination of this Agreement.

14. PATENTS, COPYRIGHTS, TRADE SECRETS, TRADEMARKS AND MASKWORK RIGHTS

A. Supplier makes no agreement to defend, indemnify or hold Buyer harmless from any costs, expenses, losses, damages or liabilities incurred because of actual or alleged infringement of any patent, trade secret or other intellectual property right by, or arising from use of, [ ] slurry or any other Items designated as custom by the parties. For all other Items, Supplier agrees to indemnify and hold Buyer harmless from any costs and expenses (including reasonable attorneys' fees) incurred in connection with, and damages awarded to a third party as a direct result of, adjudicated claims of infringement of any third party patent, trade secret, trademark or other intellectual property right arising out of the purchase of Items by Buyer or the use of Items by Buyer or Buyer's customers, provided, however, that Seller is not obligated to so indemnify Buyer, if
(i) the sale of such Item by Supplier does not constitute contributory infringement or inducement to infringe; or (ii) Buyer modifies the Item; or
(iii) Buyer uses the Item in a manner other than the specific use for which the Item is sold by Supplier. Buyer shall promptly notify Supplier of such claim or demand and shall permit Supplier to participate in the defense thereof.

B. To the extent any settlement of a claim or demand is for an amount less than the [ ] set forth in this Section, Supplier shall have the right to settle said claim at its discretion.

C. If an injunction issues as a result of any such claim or action or if Supplier determines in good faith that it is unable or unwilling to supply an Item because the Item itself or the use of the Item may infringe a patent or may constitute a misappropriation of a trade secret, Supplier agrees at its expense and Buyer's option to either: (i) procure for Buyer and Buyer's customers the right to continue using Items; (ii) replace them with non-infringing Items; or (iii) modify them so they become non-infringing. Buyer's sole remedy for Supplier's failure to supply or to obtain the remedy elected shall be [ ], and upon [ ] Supplier shall not be deemed in breach of this Agreement.

D. In no event shall [ ]. The [ ] contained in this Section 14 is separate and independent from the [ ] contained in Section 8, and the amount of liability imposed under one of these Sections does not limit or restrict the amount of liability imposed under another Section.

15. HAZARDOUS MATERIALS

A. If Items or any services provided hereunder include hazardous materials as defined by relevant local, state, and national law, Supplier represents and warrants that Supplier and its personnel providing services to Buyer understand the nature of and hazards associated with the design and/or service of Items including handling, transportation, and use of such hazardous materials, as applicable to Supplier. Prior to causing hazardous materials to be on Buyer's property, Supplier shall obtain written approval from Buyer's Site Environmental/Health/Safety organization. Supplier will indemnify Buyer from any

environmental liability incurred by Buyer which results from the shipment and delivery of hazardous Items to Buyer, provided Buyer's negligence was not a proximate cause of such liability.

B. Supplier will timely provide Buyer with material safety data sheets and any other documentation reasonably necessary to enable Buyer to comply with applicable laws and regulations.

C. Supplier hereby certifies that Items supplied to Buyer do not contain and are not manufactured with any ozone depleting substances, as those terms are defined by law.

16. CUSTOMS CLEARANCE

Upon Buyer's request, Supplier will promptly provide Buyer with a statement of origin for all Items and with applicable customs documentation for Items wholly or partially manufactured outside of the country of import.

17. COMPLIANCE WITH LAWS

A. Supplier shall comply with all national, state, and local laws and regulations governing the manufacture, transportation, and/or sale of Items and/or the performance of services in the course of this Agreement. In the United States, these may include, but are not limited to, Department of Commerce, Environmental Protection Agency, and Department of Transportation regulations applicable to hazardous materials.

B. Supplier represents and agrees that it is in compliance with Executive Order 11246 and implementing Equal Employment Opportunity regulations and the Immigration Act of 1987, unless exempted or inapplicable.

18. MERGER, MODIFICATION, WAIVER, AND REMEDIES

A. This Agreement contains the entire understanding between Buyer and Supplier with respect to the subject matter hereof and merges and supersedes all prior and contemporaneous agreements, dealings and negotiations. No modification, alteration or amendment shall be effective unless made in writing, dated and signed by duly authorized representatives of both parties.

B. No waiver of any breach hereof shall be held to be a waiver of any other or subsequent breach.

C. Except as otherwise expressly limited herein, the parties' rights and remedies herein are in addition to any other rights and remedies provided by law or in equity.

D. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, such determination shall not affect the validity of the remaining provisions unless Buyer determines in its discretion that the court's determination causes this Agreement to fail in any of its essential purposes.

19. ASSIGNMENT

Neither party may assign or factor any rights in nor delegate any obligations under this Agreement or any portion thereof without the written consent of the other. However, Supplier may assign its rights and obligations hereunder to its direct and indirect subsidiaries, without such consent. Buyer may cancel this Agreement for cause should Supplier attempt to make an unauthorized assignment of any right or obligation arising hereunder.

20. APPLICABLE LAW

This Agreement is to be construed and interpreted according to the laws of the State of Delaware, excluding its conflict of laws provisions. This Agreement is not subject to the United Nations Convention on Contracts for the International Sale of Goods, in accordance with Article 6 thereof.

21. HEADINGS

The headings provided in this Agreement are for convenience only and shall not be used in interpreting or construing this Agreement.

22. SPECIFIC PERFORMANCE

Notwithstanding anything else contained in this Agreement, the parties hereto agree that failure to perform certain obligations undertaken in connection with this Agreement would cause irreparable damage, and that monetary damages would not provide an adequate remedy in such event. The parties further agree that failure to deliver against accepted Purchase Orders, or to deliver confirmed supply or pricing, are such obligations. Accordingly, it is agreed that, in addition to any other remedy to which the non breaching party may be entitled, at law or in equity, the non breaching party shall be entitled to injunctive relief to prevent breaches of the provisions of this Agreement, and an order of specific performance to compel performance of such obligations in any action instituted in any court of the United States or any state thereof having subject matter jurisdiction.

23. SURVIVAL

The provisions of Sections: 1, 8, 13, 14, 15, 20 will survive any termination or expiration of this Agreement. In addition, any license granted pursuant to Section 25 which is exercised prior to the Expiration Date shall remain in force and effect for a period of three (3) years following the Expiration Date, and Section 25 shall survive for this three-year time period following the Expiration Date.

24. VOLUME COMMITMENTS

A. Buyer's and Supplier's volume obligations and sales commitments for [ ] are set forth in Addendum D for the years set forth therein.

B. Notwithstanding the volume obligations described above and set forth in detail in Addendum D of this Agreement, in the event that (i) Buyer is made a party to litigation arising from a claim of intellectual property infringement for which Buyer is indemnified, pursuant to Section 14 above, and (ii) Buyer determines, in good faith, after a thorough review of the claim, underlying patent, requested relief, Buyer's defenses and other relevant facts, that Supplier's indemnification obligation (which Supplier has the unilateral right to [ ]) would not be adequate with respect to the potential liability to such person, [ ], unless Supplier agrees in writing to increase [ ] set forth in Section 14 to a level which exceeds Buyer's good faith estimate of the amount of the likely damages to be incurred in such lawsuit.

C. Notwithstanding the volume obligations described above and set forth in detail in Addendum D of this Agreement, in the event Supplier does not supply a particular Item for the reasons stated in Section 14C above, Supplier shall be released from its contractual obligation to supply the affected Item to Buyer.

25. LICENSE

A. Supplier agrees to grant to Buyer and/or its designee a contingent, royalty-free, fully-paid, worldwide, non-exclusive, irrevocable license, under those intellectual property rights that are owned by Supplier, or licensed to Supplier (which Supplier has the right to sublicense), that are necessary to make, use and import, and in the

case of any such designee, to sell to Buyer or offer for sale to Buyer, those specific Items that Supplier is not able to supply under this Agreement for one of the following reasons:

(i) Supplier is [ ] selling or delivering such specific Item(s) to Buyer, or

(ii) Supplier determines in good faith that it is [ ].

The above described license is expressly limited to the right to make Items for Buyer's sole use, or in the case of a designee, to make, sell or offer for sale Items (not supplied for the reasons set forth above), in an amount not to exceed those set forth in Addendum D, for Buyer's sole use. In addition, the above described license shall not obligate Supplier to disclose any trade secrets to Buyer or its designee other than the formulation (i.e., the ingredients and proportions) of the Item which has not been supplied. Any disclosure of such Item's formulation to Buyer and/or its designee shall be subject to Buyer and/or its designee entering into appropriate obligations of confidentiality with respect to such formulation.

B. In the event (i) Buyer is made a defendant in litigation by any person or entity other than [ ], arising from a claim of patent infringement for which Buyer is indemnified, pursuant to Section 14 above; and (ii) Supplier is willing to continue to supply the affected Items; and (iii) Supplier is unable to settle such litigation for an amount less than the [ ]; and (iv) Buyer determines, in good faith, after a thorough review of the claim, underlying patent, requested relief, Buyer's defenses and other relevant facts, that Supplier's indemnification obligation (which Supplier has the unilateral right [ ] with respect to the [ ] to such person, then Supplier shall be obligated to either:

(i) Grant to Buyer and/or its designee a non-exclusive, royalty-bearing, irrevocable license, under those patent rights that are owned by Supplier, or licensed to Supplier (which Supplier has the right to sublicense), that are necessary to make, use and import, and in the case of any such designee, to make and sell to Buyer or offer for sale to Buyer, those specific Items (in an amount not to exceed that set forth in Addendum
D) that are the subject of such litigation, provided, that Supplier receives a non-exclusive, royalty-bearing, perpetual, irrevocable license under the patent that is being asserted in the infringement litigation and any other such patents of such party that are necessary to make and use those specific Items. The [ ] in such case with respect to the cross-licenses granted shall be [ ] of the purchase price or fair market value (if produced by Buyer internally) of the Item that is [ ]; or

(ii) Grant to Buyer and/or its designee a non-exclusive, royalty-bearing, irrevocable license, under those patents that are owned by Supplier, or licensed to Supplier (which Supplier has the right to sublicense), that are necessary to make, use and import, and in the case of any such designee, to make and sell to Buyer or offer for sale to Buyer, those specific Items that are the subject of such litigation. The [ ] in such case shall be [ ] of the purchase price or fair market value (if produced by Buyer internally) of the Item that is [ ]. The foregoing license grant is expressly limited to the right to make Items (in an amount not to exceed that set forth in Addendum D) for Buyer's sole use.

In the event Buyer exercises its right to have a license granted to Buyer and/or its designee under this Section 25B, any such license grant shall not subsequently

revert to a license grant under Section 25A, regardless of whether Supplier subsequently stops supplying the affected Item.

CABOT PART #        PKG         POINT OF           DESTINATION         PRICE PER GALLON
                              MANUFACTURE
    [ ]             IBC      United States     United States (FOB            $[ ]
                                                local Warehouse)

                                                  Ireland (DDU)              $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]             IBC       Barry, Wales     United States (FOB            $[ ]
                                                local Warehouse)

                                                  Ireland (DDU)              $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]           IBC/DTA    United States     United States (FOB            $[ ]
                                                local Warehouse)

CABOT PART #        PKG         POINT OF          DESTINATION          PRICE PER GALLON
                              MANUFACTURE
    [ ]             IBC      United States     United States (FOB            $[ ]
                                                local Warehouse)

                                                 Ireland (DDU)               $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]             IBC       Barry, Wales     United States (FOB            $[ ]
                                                local Warehouse)

                                                 Ireland (DDU)               $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]           IBC/DTA    United States     United States (FOB            $[ ]
                                                local Warehouse)

CABOT PART #        PKG         POINT OF          DESTINATION          PRICE PER GALLON
                              MANUFACTURE

    [ ]             IBC      United States     United States (FOB            $[ ]
                                                local Warehouse)

                                                 Ireland (DDU)               $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]             IBC       Barry, Wales     United States (FOB            $[ ]
                                                local Warehouse)

                                                 Ireland (DDU)               $[ ]

                                                  Israel (DDP)               $[ ]

    [ ]           IBC/DTA    United States     United States (FOB            $[ ]
                                                local Warehouse)

Prices for purchases of requirements percentages between the requirements percentages shown in the above tables (i.e. quantities between [ ]%, [ ]% and [ ]%) shall be determined by a straight line extrapolation of the prices shown in the above tables.

The price per gallon of [ ] shall be calculated based upon the percent share of Buyer's requirements for [ ] or its equivalent associated with Buyer's [ ] manufacturing processes which Buyer forecasts for the relevant calendar year. For example, if Buyer purchases [ ]% of its total requirements for [ ] or its equivalent associated with Buyer's [ ] manufacturing processes in the form of [ ] from Supplier in calendar year 2000, the price will be determined using Table B. However, if Buyer purchases [ ]% of its total requirements for [ ] or its equivalent associated with Buyer's [ ] manufacturing processes in the form of [ ] from Supplier in calendar year 2000, the price will be determined using Table A.

B. [ ]

CABOT PART #       PKG     POINT OF     DESTINATION    PRICE BASED ON CUMULATIVE VOLUMES OF [       ] PURCHASED
                         MANUFACTURE
                                            #            [ ]-[ ]   [ ]-[ ]    [ ]-[ ]    [ ]-[ ]      [ ]-[ ]        > [ ]*
[   ]              IBC  United States   United States     $[ ]      $[ ]       $[ ]        $[ ]         $[ ]          $[ ]
                                        (FOB local
                                         warehouse)
                        United States      Israel         $[ ]      $[ ]       $[ ]        $[ ]         $[ ]          $[ ]
                                           (DDP)
                        United States   Ireland (DDU)     $[ ]      $[ ]       $[ ]        $[ ]         $[ ]          $[ ]

* volumes in thousands of gallons

The price per gallon of [ ] shall be calculated based upon the cumulative volume of gallons of [ ] purchased by Buyer from Supplier during the term of this Agreement. Adjustments to the price, based upon the cumulative gallons of [ ] purchased by

Buyer from Supplier, shall take effect in the quarter following the quarter in which Buyer surpasses a volume threshold.

C. [ ]

CABOT PART #               PKG          POINT OF MANUFACTURE            DESTINATION #          PRICE PER GALLON
    [ ] *                  IBC              United States          United Sates (FOB local           $[ ]
                                                                          warehouse)

    [ ] *                  IBC              United States               Ireland (DDU)                $[ ]

    [ ] *                  IBC              Barry, Wales                Ireland (DDU)                $[ ]

    [ ] *                  IBC              Barry, Wales           United Sates (FOB local           $[ ]
                                                                          warehouse)

* [ ]

D. [ ]

CABOT PART #              PKG           POINT OF MANUFACTURE            DESTINATION #          PRICE PER GALLON
     [ ]                  IBC              United States           United Sates (FOB local           $[ ]
                                                                         warehouse)

DEPARTMENT/TITLE                            NAME                  PHONE

OHKA:
Account Representative                      Brad Staley           630-375-5508
Accounts Receivable                                               630-585-9471
24-Hour Emergency Contact                   Brad Staley           630-375-5508
Schedule/Delivery Contact                   Soni Pahia            916-939-9364
General                                     Bruce Zwicker         630-375-5540


INTEL:
FMO
Commercial                                  Mumtaz Ahmed          408-765-88
Technical                                   Ara Philipossian      408-765-6256
                                            Joe Schoenholtz       408-765-2435
Buyers
        Ireland                             Caitriona Delaney     011-353-1-606-8630
        New Mexico                          Tami Freeman          505-893-3538
           Fab 6                            Oscar Ochoa           602-554-8417
           Fab 12                           Oscar Ochoa           602-554-8417
        Israel
  Fab 8                                     Anna Provad           011-972-2-5896357
           Fab 18                           Yaron Ozer            011-972-7-666-6953
        Santa Clara
        D2                                  Karen Ma              408-765-6152
                                            Ethel Swindall        408-765-2392
      Oregon                                Heather Holcomb       503-642-8693
      Massachusetts
         F17                                Tony Quarta
Accounts Payable:
        AZ/CA                               Linda Medill          503-696-3237
        OR                                  Jessica Ailshie       503-696-3046
        NM                                  Debbie Martin         503-696-3302

SPEC. NO.           REV.                   TITLE                                                 ISSUE DATE

07-116              0         MATERIALS CHANGE CONTROL POLICY                                     05/22/98


07-123              2         SUPPLIER CORRECTIVE ACTION POLICY                                   02/25/98

07-124              4         FMO/ATMO-DISCREPANT RAW MATERIAL DISPOSITION POLICY                 06/09/98

07-400              7         CHEMICALS SPECIFICATION SYSTEM                                      06/05/97

07-401              6         PROCEDURE FOR SHIPPING & RECEIVING OF CHEMICALS                     12/05/97

07-402              5         INTEL CHEMICAL QUALITY PROGRAM                                      06/26/98

07-403              2         SHIPPING OF TEMP-SENSITIVE CHEMICALS                                12/05/97

07-411              4         PROCUREMENT SPEC FOR CHEMICALS                                      11/25/98

ADDENDUM D
VOLUME OBLIGATIONS

A. [ ]

During the years set forth below, Buyer shall be obligated to purchase from Supplier a [ ] volume of [ ] which is equal to the product of (i) Buyer's total requirements for [ ] utilized in [ ] polishing associated with Buyer's [ ] manufacturing processes ("[ ] Slurry Requirements"), multiplied by (ii) the [ ] Percentage (set forth in the table below). During the years specified below, Supplier shall be obligated to supply to Buyer a volume of [ ] which is equal to the product of (i) Buyer's forecasted volume of [ ] Slurry Requirements for the upcoming calendar year (which forecast shall be provided to Supplier 90 days prior to the commencement of each calendar year), multiplied by (ii) the [ ] Percentage (set forth in the table below).

[ ] SLURRY VOLUME OBLIGATIONS

CALENDAR YEAR             BUYER'S [ ] PERCENTAGE                 SUPPLIER'S [ ] PERCENTAGE
-------------             ----------------------                 -------------------------
    1999                           [ ] %                                   [ ] %
    2000                           [ ] %                                   [ ] %
    2001                           [ ] %                                   [ ] %

Ninety days prior to the commencement of each calendar year, Buyer shall commit and obligate itself to purchase from Supplier a specific percentage of its [ ] Slurry Requirements (which percentage shall be at least as large as the [ ] Percentage) which it shall purchase from Supplier during the upcoming year. The amount of [ ] which Buyer will purchase, above the [ ] Percentage, will be determined according to whether Supplier meets requirements set by Buyer's Supplier Score Card.

B. [ ]

During the years set forth below, Buyer shall be obligated to purchase from Supplier a [ ] volume of [ ] which is equal to the product of (i) Buyer's total requirements for [ ] utilized in [ ] polishing applications associated with Buyer's [ ] manufacturing processes ("[ ] Requirements"), multiplied by (ii) the
[ ] Percentage (set forth in the table below). During the years specified below, Supplier shall be obligated to supply to Buyer a volume of [ ] which is equal to the product of (i) Buyer's forecasted volume of [ ] Requirements for the upcoming calendar year (which forecast shall be provided to Supplier 90 days prior to the commencement of each calendar year), multiplied by (ii) the [ ] Percentage (set forth in the table below). Notwithstanding the foregoing, during the course of any

calendar year, Buyer may, by giving 4 months advance written notification to Supplier, increase its forecasted [ ] requirements for the remainder of the year (starting after the 4 month notice period), provided, however, such new forecasted amount may not exceed a volume which is greater than the product of the remaining volumes from the original forecasted amount, multiplied by [ ].

[ ] SLURRY VOLUME OBLIGATIONS

CALENDAR YEAR           BUYER'S [ ] PERCENTAGE               SUPPLIER'S [ ] PERCENTAGE
    1999                         [ ] %                                 [ ] %
    2000                         [ ] %                                 [ ] %
    2001                         [ ] %                                 [ ] %

90 days prior to the commencement of 2001, Buyer shall commit and obligate itself to purchase from Supplier a specific percentage of its [ ] Requirements (which percentage shall be at least as large as the [ ] Percentage) which it shall purchase from Supplier during 2001. The amount of [ ] which Buyer will purchase, above the [ ] Percentage, will be determined according to whether Supplier meets requirements set by Buyer's Supplier Score Card.

C. [ ]

During the years set forth below, Buyer shall be obligated to purchase from Supplier a [ ] volume of [ ] which is equal to the product of (i) Buyer's total requirements for [ ] utilized in [ ] polishing applications associated with Buyer's [ ] manufacturing processes ("[ ] Requirements"), multiplied by (ii) the
[ ] Percentage (set forth in the table below). For each month of this Agreement, Supplier shall be obligated to supply to Buyer a volume of [ ] which is equal to the product of (i) the volume of [ ] Buyer purchased from Supplier during the preceding month, multiplied by (ii) the [ ] Percentage (set forth in the table below).

[ ] SLURRY VOLUME OBLIGATIONS

CALENDAR YEAR                  [ ] PERCENTAGE                                [ ] PERCENTAGE
    1999                           [ ] %                                          [ ] %
    2000                           [ ] %                                          [ ] %
    2001                           [ ] %                                          [ ] %

D. [ ]

Neither Buyer nor Supplier have any volume obligations with respect to [ ]

With respect to all of the above describe Items, in the event Buyer does not purchase a particular Item for use in its facilities in either [ ] for any [ ], Supplier shall no longer be obligated to supply such Item to Buyer's facilities in the relevant geographic region.

Exhibit 10.12

The omitted portions indicated by brackets have been separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406, promulgated under the Securities Act of 1933, as amended.

SERVICES AGREEMENT

This SERVICES AGREEMENT (the "Agreement"), dated October 27, 1998, by and among Davies-Imperial Coatings, Inc. ("Davies"), an Indiana corporation having a place of business at 1275 State Street, Hammond, Indiana, Cabot Corporation ("Cabot"), a Delaware corporation having a place of business at 75 State Street, Boston, Massachusetts, and, for purposes of Sections 10.1, 11, 13.4, 15, 18, 19, 20.6 and 20.9, Donn Davies, an individual, and JoAnn Davies, an individual.

WHEREAS, Cabot desires to have Davies provide to Cabot metal oxide dispersion services; and

WHEREAS, Davies desires to provide metal oxide dispersion services to Cabot;

NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

SECTION 1. TERM

This Agreement shall commence on October 27 , 1998, and shall continue until October 27, 2004 (the "Initial Term"). This Agreement shall thereupon be automatically renewed for additional one (1) year periods (each a "Renewal Term", and together with the Initial Term, the "Term"; each year of the Term referred to herein as a "Term Year"), unless either party gives written notice of its intention to terminate the Agreement at least 90 days prior to the expiration of the Initial Term or any Renewal Term.

SECTION 2. SERVICES

2.1 Purchase and Sale. Subject to the terms and conditions of this Agreement, during the Term, Davies shall provide to Cabot, and Cabot shall purchase from Davies, the Services (as defined below) in such quantities as specified by Cabot, subject to Section 2.4, below. "Services" means (a) the manufacturing of the metal oxide dispersions set forth on Schedule A hereto (the "Products") in accordance with the specifications, formulae and processes provided by Cabot to Davies and initially as set forth in the materials specified on Schedule A hereto, (b) the packaging of the Products in accordance with specifications provided by Cabot from time to time, and (c) such ancillary services as specified herein. Cabot may amend Schedule A from time to time on 30 days written notice to Davies provided such amendments either do not result in a material increase in cost to Davies or are agreed to in advance by Davies; Davies may only amend such schedule with Cabot's prior written consent.

2.2 Materials, Labor, etc.

(a) Subject to the following sentence, Cabot shall supply to Davies all raw materials, packaging materials and filter media, with the exception of wooden pallets and nominal filter bags, necessary for Davies to perform the Services. In the event Cabot requests that Davies purchase specified materials, Davies shall acquire the specified materials and shall bill Cabot therefor at Davies' cost, including any handling charges incurred by Davies in connection therewith. Title to all such materials shall remain with Cabot at all times.

(b) Davies shall supply all materials and services, other than as set forth in Section 2.2(a), above, necessary to provide the Services, including, but not limited to, labor, administration, raw materials management, inventory management, on-site warehousing, security, facility space, utilities, maintenance, quality control, quality assurance, preparation of certificates of analysis, order fulfillment, sample fulfillment, wooden pallets, coordination of shipping and implementation of ISO conformance, as such may be set forth in greater detail elsewhere in this Agreement. Subject to the following sentence, Davies shall adequately insure all equipment at its Hammond, Indiana facility, including the Cabot Assets, as defined below and as set forth on Schedule C hereto. With respect to Products, as defined herein, Cabot shall adequately insure all raw materials, finished goods and works-in-process.

2.3 Payment. Davies shall make good faith efforts to invoice Cabot for its Services and for other charges on or before the second business day of each month during the Term, but in no event later than the tenth day of such month, and shall send such invoices to Cabot by express mail or similar means of delivery. Cabot shall make a good faith effort to pay such invoices as soon as possible following its first check run after it receives the relevant invoice, but in any event, payment shall be made within ten (10) days after the date of invoice.

2.4 Quantity. During each Term Year, Cabot will purchase Services from Davies for not less than the lesser of (i) [ ] gallons of Product or (ii) [ ] percent ([ ]%) of the total amount of orders received by Cabot for Products for shipment to customer locations in North America. Cabot's purchase of Services from Davies shall reflect its good faith expectations of customer demand and Cabot shall use its reasonable efforts to distribute substantially evenly the quantities of its purchases of Services to avoid creating production capacity problems for Davies.

2.5 Failure to Provide Services. In addition to any other rights and remedies of Cabot under this Agreement, in the event that Davies fails to supply Cabot with its requirements for Services for any reason, Cabot shall have the right to provide such Services for itself or purchase Services from sources other than Davies. In such event, the amount of Products so provided or purchased shall count toward the volume requirements of Section 2.4 hereof (each a "Setoff"), provided, however, than in order for Cabot to be entitled to a Setoff, Cabot must have provided Davies at least one week lead time on the relevant order and the relevant order must not be for a quantity in excess of [ ] per week.

SECTION 3. SHIPPING; DELIVERY

All Products shall be prepared for delivery to Cabot or a customer of Cabot, as the case may be, in accordance with Cabot's instructions.

SECTION 4. PRICING

4.1 Prices. Davies shall perform the Services and provide such miscellaneous services in connection therewith in accordance with the prices set forth on Schedule B hereto (the "Prices").

4.2 Renegotiation. Cabot and Davies acknowledge that it is their intention simultaneously to increase the quality of the Products and to decrease the costs associated with manufacturing the Products, and to share any cost savings between them. Recognizing that intention, on each two-year anniversary of the execution of this Agreement, Cabot and Davies shall in good faith negotiate any necessary changes (increases or decreases) to the Prices. Necessary changes are changes that reflect changes in Davies' manufacturing costs. In determining the changes to be made, the parties shall give consideration to price pressures in the marketplaces of which the relevant Products are a part. In no event shall the Price for Services relating to any one Product be increased more than [ ]% per year.

SECTION 5. CAPITAL EXPENDITURES

5.1 CapEx Investment. Cabot agrees to invest not less than One Hundred Fifty Thousand Dollars ($150,000) (the $150,000 minimum referred to herein as the "CapEx Investment") in capital improvements, capacity expansions and/or capital expenditures to maintain capacity at Davies' facility relating to the Services during each Term Year. Prior to making any such capital expenditures, Cabot will consult with Davies to identify the priorities for such expenditures.

5.2 CapEx Carryover. If Cabot does not spend the total amount of the CapEx Investment in a given Term Year, Davies may carry over the unspent portion of such CapEx Investment to the next Term Year, provided, however, that Cabot may, at its sole option, pay Davies within ninety (90) days of the end of such Term Year an amount in cash equal to such unspent portion, in which case there shall be no carryover for such Term Year. Notwithstanding the foregoing sentence, if in any given Term Year Cabot agrees to spend more than the CapEx Investment for that Term Year (including any carryover) on capital improvements and/or capital expansions at Davies' facility, the excess shall be credited toward the CapEx Investment in future Term Years, beginning with the immediately succeeding Term Year.

SECTION 6. MAINTENANCE AND IMPROVEMENTS

6.1 Maintenance.

(a) Davies shall be responsible for the proper customary maintenance of all assets used, directly or indirectly, in its provision of Services, including the Cabot Assets (as defined below). Notwithstanding the foregoing, Cabot shall be responsible for costs under third-party maintenance contracts relating to the
[ ] system located at Davies' facility in Hammond, Indiana. The parties acknowledge that to the extent certain maintenance items are not individually specified on Schedule A hereto, the cost of such maintenance items are reflected in the Prices for the Services.

(b) If Cabot makes a good faith determination that Davies is not complying with Section 6.1(a) hereof, Cabot shall have the right to enter upon Davies' premises in order to perform the maintenance required by Section 6.1(a). Any amounts expended by Cabot pursuant to this Section 6.1(b) shall be credited toward the CapEx Investment for such Term Year. The fact that Cabot makes use of this Section 6.1(b) shall have no effect on any of its rights and remedies with respect to Davies' failure to comply with Section 6.1(a).

6.2 Improvements. After taking into account the improvements made pursuant to Section 5.1 hereof, Davies agrees to make all capital improvements to its Hammond, Indiana facility that are necessary or advisable in order to continue to provide the Services in a timely manner.

SECTION 7. RIGHT TO BID

Cabot shall provide Davies the opportunity to bid to provide the Services with respect to all Cab-O-Sperse(R) and Semi-Sperse(R) metal oxide dispersions to be manufactured in North America, other than those to be manufactured solely by Cabot or any Cabot affiliate. As used in this Agreement, "affiliate" means, with respect to any person or entity, any person or entity, directly or indirectly controlling, controlled by, or under common control with any such person or entity.

SECTION 8. PROPRIETARY INFORMATION; CONFIDENTIALITY

8.1 Proprietary Information.

(a) Subject to Section 8.1(b) hereof, the term "Proprietary Information" shall mean, whether disclosed prior to, on or after the date hereof and whether or not marked or identified as confidential, formulae, specifications, demographic and trade information, costs, intellectual property and applications for the same (including, but not limited to, patents, copyrights, trademarks, trade names, service marks, service names, technology, know-how, processes, trade secrets, inventions, data and software), names of investors and customers, and other strategic business, marketing, sales and financial information relating to the relevant party's business (including, but not limited to business plans, marketing strategy, and production information).

(b) The term "Proprietary Information" does not include any information which (i) at the time of disclosure or thereafter is generally available to or known by the public (other than as a result of the acts by the recipient or its representatives in breach of this Agreement), (ii) was or becomes available to the recipient on a non-confidential basis from a source other than the provider or its advisors, provided that such source is not and was not bound by a confidentiality agreement with the provider, or (iii) has been independently acquired or developed by the recipient without violating any of its obligations under this Agreement.

8.2 Ownership. All information and materials, including Proprietary Information of Cabot, its subsidiaries and its affiliates and all physical manifestations thereof, that are received by Davies from Cabot prior to, on or after the date hereof in connection with the Services or that are or were created or produced by Davies and are based upon, or are otherwise prepared with use of or reference to, Proprietary Information of Cabot, shall be and remain the sole and exclusive property of Cabot. Upon written request by Cabot, Davies shall return to Cabot all tangible forms of the Proprietary Information of Cabot, including any and all copies, and all unused samples of materials Cabot may have provided.

8.3 Confidentiality.

(a) Davies acknowledges, understands and agrees that all Proprietary Information of Cabot and its subsidiaries and affiliates is confidential and shall remain the exclusive property of Cabot, its subsidiaries or its affiliates, as the case may be. Cabot acknowledges, understands and agrees that all Proprietary Information of Davies is confidential and shall remain the exclusive property of Davies. Each of Cabot and Davies agrees that for a period of fifteen (15) years from and after the termination or expiration of the Term, it shall keep and hold as confidential, and shall require its directors, officers, employees, agents and representatives, to keep and hold as confidential, any and all Proprietary Information of the other unless disclosure is required by applicable law or by terms of a subpoena or other order issued by a court of competent jurisdiction. Each party shall promptly notify the other of any such subpoena or order, shall contest any such subpoena or order and shall (to the extent possible) permit the owner of such Proprietary Information to contest any such subpoena or order. Except as so required, neither party shall disclose any Proprietary Information of the other to third parties, or to its employees or representatives who do not have a need to know it in connection with the subject of the transactions contemplated by this Agreement, and neither party shall use (or permit to be used) any Proprietary Information of the other except for the purposes contemplated hereby. For purposes of this Section 8, the party providing any of its Proprietary Information is sometimes referred to as the "provider" and the party receiving any of the other's Proprietary Information is sometimes referred to as the "recipient."

(b) Davies agrees to cause each of its employees as of the date of this Agreement, and any person who becomes an employee of Davies during the Term, to enter into a confidentiality agreement with Cabot that provides for essentially the same kind and degree of confidentiality as set forth in Section 8.3(a) hereof with respect to Davies.

8.4 Redelivery Upon Termination. The recipient shall deliver or cause to be delivered to the provider, or destroy, promptly after termination of this Agreement for any reason any documents containing Proprietary Information and any copies thereof which the recipient (or others to whom the recipient has disclosed the same hereunder whether authorized hereby or not) may have and shall permanently erase or cause to be erased all Proprietary Information from any computer memory or storage.

SECTION 9. INTELLECTUAL PROPERTY

9.1 Intellectual Property.

(a) With regard to any inventions, improvements and technical information that are created or produced on or after the date of this Agreement by any of the parties hereto in connection with the Services, or that are based upon or suggested by any Proprietary Information of Cabot (the foregoing, collectively, referred to herein as the "Term IP"), Davies agrees that Cabot will be the sole and exclusive owner thereof, including all patents, copyrights, and other intellectual property rights therein. Davies hereby assigns and agrees to assign, without any additional compensation, all right, title and interest in and to such inventions, improvements and technical information, including all patents, copyrights and other intellectual property rights therein, to Cabot. Davies further agrees, at Cabot's request and expense, to provide assistance to Cabot in every reasonable way to perfect and vest title in and to such inventions, improvements and technical information, including all patents, copyrights and other intellectual property rights therein, in Cabot and to assist Cabot in every reasonable way in obtaining and enforcing patents, copyrights, and other intellectual property rights in and to such inventions, improvements and technical information throughout the world.

(b) The parties acknowledge that over the course of their relationship and prior to the date of this Agreement, they, individually or jointly, have created or produced certain inventions, improvements and technical information relating to the processes and techniques for dispersing metal oxides (the "Existing IP"). Except as provided in Section 8.2 hereof, the portion of the Existing IP created or produced solely by Davies is referred to herein as the "Davies IP." The portion of the Existing IP created or produced solely by Cabot or jointly by Cabot and Davies, together with the Term IP, is referred to herein as the "Cabot IP."

9.2 Licenses.

(a) Davies hereby grants to Cabot a fully paid-up, nonexclusive, irrevocable, world-wide, perpetual license to use the Davies IP, including the right for Cabot to sub-license the Davies IP to any of its subsidiaries, affiliates or any third parties (collectively the "Sub-licensees"). Notwithstanding Section 8.3 hereof, the license provided for by this Section 9.2(a) shall include Cabot's and the Sub-licensees' right to use the Proprietary Information of Davies.

(b) Subject to Section 9.3 hereof, Cabot hereby grants to Davies a fully paid-up, nonexclusive, irrevocable, world-wide, perpetual license to use the Cabot IP, provided, however, that Davies may neither transfer any or all of the Cabot IP to any third party, nor grant a sub-license with respect to any or all of the Cabot IP.

(c) The licenses granted pursuant to this Section 9.2 shall survive the termination of this Agreement.

9.3 Use of IP to Benefit Competitors. Davies agrees that from and after the date hereof, and notwithstanding any termination of this Agreement, it will not use either the Davies IP or the Cabot IP for the benefit of any entity which, directly or indirectly, competes with any business carried on by Cabot or any of Cabot's affiliates.

SECTION 10. RIGHT OF FIRST REFUSAL TO PURCHASE DAVIES' BUSINESS

10.1 Offer.

(a) If, at any time, Davies, Donn Davies or JoAnn Davies desires to sell part or all of the equity of Davies (in an aggregate amount greater than 10% of the total equity) or the assets owned by Davies and used or useful in connection with its metal oxide dispersion business (in a single transaction or series of transactions) (the portion of assets or equity, as the case may be, that Davies, Donn Davies or JoAnn Davies desires to sell referred to herein as the "Business"), whether by merger, stock sale, asset sale or otherwise or in a single transaction or a series of transactions, such party or parties shall submit a written offer (the "Offer") to sell the Business to Cabot as provided herein. The Offer shall disclose which assets or stock is proposed to be sold, the terms and conditions, including price and payment terms, of the proposed sale, and the prospective purchaser of the Business. The Offer shall further state that Cabot may acquire all but not less than all of the Business for the price and upon the other terms and conditions set forth therein.

(b) If Cabot wishes to purchase the Business at the price and on the terms and conditions set forth in the Offer, it shall, within 30 days from the date of the Offer, notify Davies in writing (the "Acceptance").

10.2 No Transfer Except as Provided. Davies shall not, at any time during the Term of this Agreement, in any manner convey or transfer the Business, or any part thereof, except in accordance with the terms and conditions contained in this Section 10.

10.3 Right to Sell to Third Party. If Cabot does not provide Davies with an Acceptance within the 30-day period set forth in Section 10.1(b) hereof (or if Cabot by notice to Davies earlier waives its right to purchase), Davies shall be free, during the 120-day period following Davies' submission of the Offer pursuant to Section 10.1(a) hereof, to convey the Business to the third party identified in the Offer on terms and conditions (including price) no more favorable to the third party than those contained in the Offer. If Davies does not sell the Business within such 120-day period, the Business shall again become subject to this right of first refusal.

10.4 Right to Remove Assets. If Davies enters into an agreement to sell the Business to such third party in accordance with the provisions of this
Section 10, it shall notify Cabot at least 30 days prior to the closing of such sale and Cabot shall be permitted at Cabot's expense to remove the Cabot Assets (as defined below) prior to any such sale.

SECTION 11. NONCOMPETITION AND RELATED PAYMENTS

(a) Each of Davies, Donn Davies and JoAnn Davies (collectively, the "Davies Group") hereby acknowledges the value each shall receive from the execution of this Agreement by the other parties hereto, including Cabot, and the benefits associated therewith. In consideration for such value each member of the Davies Group hereby agrees that during the Term and the Additional Non-Compete Period (as defined below), none of the members of the Davies Group shall provide or assist any other person or entity to provide metal oxide dispersion services to any Competitor. In the event of a breach of this Section 11(a) by any member of the Davies Group, none of the members of the Davies Group shall receive any part of the Noncompetition Payment. For purposes of this
Section 11, "Competitor" shall mean any person or entity (other than Cabot and Cabot's affiliates) that, directly or indirectly, competes with any business carried on by Cabot or any of Cabot's affiliates. As used herein, "Additional Non-Compete Period" shall mean (a) if Davies shall give notice of election not to renew the Agreement in accordance with Section 1 hereof (a "Non-Renewal Notice") or if Cabot shall terminate this Agreement pursuant to Section 13.1 hereof, a period of [ ] after the termination of the Agreement, or (b) if Cabot shall give a Non-Renewal Notice or if both Davies and Cabot shall give a Non-Renewal Notice or if Davies shall terminate this Agreement pursuant to
Section 13.3 hereof, a period of[ ] after the termination of the Agreement.

(b) If Cabot shall give a Non-Renewal Notice, if Davies shall terminate this Agreement pursuant to Section 13.3 hereof or if Cabot shall terminate this Agreement pursuant to Section 13.1(a), 13.1(b) or 13.1(c), Cabot shall pay to the Davies Group in consideration for such noncompetition covenant the following total amount (the "Noncompetition Payment"), to be divided equally among those members of the Davies Group in existence or living at the commencement of the Additional Non-Compete Period:

(i) [ ] if such notice by Cabot is at the end of the Initial Term;

(ii) [ ] if such notice by Cabot is at the end of the first Renewal Term (if at all);

(iii) [ ] if such notice by Cabot is at the end of the second Renewal Term (if at all); and

(iv) [ ] if such notice by Cabot is at the end of any Renewal Term thereafter.

The Noncompetition Payment will be payable in two equal installments on the date of any such termination and on the first anniversary thereof.

SECTION 12. WARRANTIES

12.1 Warranty as to Products. Davies represents and warrants to Cabot that, when shipped to Cabot or a customer of Cabot, as the case may be, by Davies, the Products will conform in all respects to the specifications then in effect and as then set forth in the materials specified on Schedule A hereto.

12.2 Quality Control. Quality control with respect to the Products shall be performed in accordance with the terms contained in the materials specified on Schedule A hereto.

12.3 Rejection. Subject to the following sentence, Cabot shall not be obligated to accept or pay for Services relating to any batch or lot containing Product not conforming to the specifications then in effect for such Product. If such non-conformity is the result of materials or formulae provided by Cabot, Cabot shall pay Davies for the Services relating to such batch or lot and such amount shall count toward the volume requirements contained in Section 2.4 hereof.

12.4 Warranty as to Violations. Davies represents and warrants that there is no past or present violation of, and there is no pending or threatened action, suit or proceeding relating to, any alleged violation of any laws, ordinances, rules or regulations relating to the environment or otherwise governing, directly or indirectly, any hazardous substances, wastes or materials in connection with the business, properties or operations of Davies.

SECTION 13. TERMINATION

Cabot and Davies each acknowledge that in the performance of this Agreement, including any exercise of termination rights under this Section, it will act in good faith.

13.1 Davies Default. Cabot may terminate this Agreement in the event of any one or more of the following occurrences (each a "Davies Default"):

(a) upon Davies' filing a petition for adjudication as a bankrupt, for reorganization or for an arrangement under any bankruptcy or insolvency law;

(b) if any involuntary petition under any bankruptcy or insolvency law is filed against Davies, is not dismissed within thirty (30) days thereafter and is then continuing;

(c) if Davies shall make an assignment of all or substantially all of its assets for the benefit of creditors, or if Davies' interest under this Agreement shall be taken upon execution;

(d) if Davies shall fail to perform any material covenant or material obligation hereunder, except as excused under Section 20.10 hereof, and such failure has not been cured within thirty (30) days following Cabot's written notice to Davies of such failure; or

(e) in the event that Davies is no longer owned or controlled by either Donn Davies or JoAnn Davies.

13.2 Continuation of Supply. Notwithstanding any termination of this Agreement, in the event of a Davies Default, Davies shall nevertheless continue to have the obligation to perform the Services for Cabot for a period of 120 days after termination of this Agreement by Cabot on the terms and conditions contained herein.

13.3 Cabot Default. Davies may terminate this Agreement in the event of any one or more of the following occurrences (each a "Cabot Default"):

(a) upon Cabot's filing a petition for adjudication as a bankrupt, for reorganization or for an arrangement under any bankruptcy or insolvency law;

(b) if any involuntary petition under such law is filed against Cabot, is not dismissed within thirty (30) days thereafter and is then continuing;

(c) if Cabot shall make an assignment of all or substantially all of its assets for the benefit of creditors, or if Cabot's interest under this Agreement shall be taken upon execution; or

(d) if Cabot shall fail to perform any material covenant or material obligation hereunder and such failure has not been cured within thirty (30) days following Davies' written notice to Cabot of such failure.

13.4 Effect of Termination.

(a) Termination of this Agreement, whether by lapse of time, mutual consent, operation of law, exercise of right of termination or otherwise shall not affect the ownership interests in the respective proprietary and other rights of the parties.

(b) Upon any termination of this Agreement, Davies shall continue to have the obligation to perform the Services to fill any outstanding orders received by Davies prior to the receipt of notice of termination.

(c) The provisions contained in Sections 8, 9, 10.4, 11, 12, 13.2, 13.4, 14, 15, 18, 19 and 20.9hereof shall survive the termination of this Agreement.

SECTION 14. CABOT ASSETS; PROTECTION OF RIGHTS

14.1 Cabot Assets. The parties acknowledge and agree that Cabot owns all right, title and interest in (a) the equipment and assets listed on Schedule C hereto and which are located at Davies' facility in Hammond, Indiana, (b) those assets purchased with the CapEx Investment pursuant to Section 5 hereof,
(c) all raw materials and packaging materials provided to Davies pursuant to
Section 2.2(a) hereof, and (d) all Products (collectively, the "Cabot Assets"). All of the Cabot Assets shall be subject to removal in accordance with the terms of this Agreement; provided, however, that all pipes, cables and wiring installed in the walls, ceilings, roof, floors or subfloors of Davies' facility and used in connection with the Cabot Assets shall remain property of Davies whether supplied or installed by Cabot or Davies.

14.2 Protection of Rights. Davies shall do all such things and execute all such documents (including without limitation, financing statements) as Cabot deems necessary or desirable to enable Cabot to protect its title to and preserve its rights in the Cabot Assets.

SECTION 15. REMEDIES

The relationship between Davies, Donn Davies or JoAnn Davies on the one hand, and Cabot on the other hand, and which is reflected in this Agreement is unique and has a value which may not be readily measured in monetary terms. Each of Cabot, Davies, Donn Davies and JoAnn Davies agrees that in the event of a violation by it of any of its undertakings hereunder, the non-breaching party shall be entitled (a) to specific performance and injunctive and other equitable relief; (b) to recover from the breaching party monetary damages caused by any such violation; and (c) to any other rights and remedies that may be available at law or in equity, which rights and remedies may be exercised, at the option of the non-breaching party, concurrently with any other right or remedy provided in this Agreement. The remedies provided herein shall not be exclusive and shall be in addition to any other rights or remedies now or hereafter existing at law or in equity, by statute or otherwise.

SECTION 16. RELATIONSHIP OF PARTIES

Davies and Cabot are each independent contractors. Nothing herein contained shall be construed to place Davies and Cabot in the relationship of principal and agent, master and servant, partners, joint venturers, and, except as otherwise set forth in this Agreement, neither party shall have, expressly or by implication, the power to represent themselves as having any authority to make contracts in the name of or binding upon the other, or to obligate or bind the other in any manner whatsoever.

SECTION 17. COMPLIANCE WITH LAWS

Davies warrants and agrees that during the Term it shall observe and comply in all material respects with all applicable federal, state, local and foreign laws, ordinances, statutes, standards, rules, regulations and orders, including but not limited to those relating to safety and health and the environment. Davies shall be responsible for obtaining all permits and licenses from governmental authorities and from private parties that are required in connection therewith. Davies shall be responsible for the handling, disposal and release of packaging material waste generated by Davies during the term of this Agreement. Cabot shall be responsible for the disposal of all off-quality Product, except for that which is off-quality through no fault of Cabot. Cabot and Davies shall make good faith efforts to jointly pursue a waste minimization program in connection with the manufacturing of Products pursuant to this Agreement.

SECTION 18. CONSENTS; NOTICES

Unless otherwise set forth herein, whenever any consent or approval is required of either party, it must be given to the other party in writing and delivered in accordance with the provisions of this Section 18. Any notice of a party shall be in writing and shall be given by (a) telecopier with original posted first class mail, postage prepaid, within two (2) business days thereafter; (b) certified or registered mail with an acknowledgment of receipt, postage prepaid, return receipt requested; or (c) a reputable private courier, such as Federal Express, which provides evidence of receipt as a part of its delivery service, and addressed as follows:

If to Cabot:                       Cabot Corporation
                                   500 Commons Drive
                                   Aurora, IL  60504
                                   Attn: Operations Director
                                   Telecopier:  (630) 585-9981

If to Davies:                      Davies-Imperial Coatings, Inc.
                                   1275 State Street
                                   P.O. Box 790
                                   Hammond, IN 46325
                                   Attn: Donn T. Davies
                                   Telecopier: ___________

If to Donn T. Davies:              Donn T. Davies
                                   c/o Davies-Imperial Coatings, Inc.
                                   1275 State Street
                                   P.O. Box 790
                                   Hammond, IN 46325
                                   Telecopier: ___________

If to JoAnn Davies:                JoAnn Davies
                                   c/o Davies-Imperial Coatings, Inc.
                                   1275 State Street
                                   P.O. Box 790
                                   Hammond, IN 46325
                                   Telecopier: ___________

or to such other address as may be designated in writing by any of the parties from time to time in accordance herewith, and shall be deemed delivered two (2) business days following delivery by hand, by private courier or when so telecopied and five (5) business days following proper dispatch by certified or registered mail. A business day is any Monday through Friday on which first class mail is delivered.

SECTION 19. ATTORNEYS' FEES

If any action or proceeding is brought to enforce or interpret any provision of this Agreement then, in addition to any other relief to which the prevailing party may be entitled, the prevailing party shall be entitled to recover its reasonable costs and attorneys' fees.

SECTION 20. GENERAL

20.1 Severability. If any provision of this Agreement shall be found to be invalid or unenforceable, then such provision or provisions shall not invalidate or in any way affect the enforceability of the remainder of this Agreement and such provision or provisions shall be curtailed and limited to the extent necessary to bring the Agreement within any legal requirement and the parties shall negotiate in good faith with respect to an equitable modification of the provision or application thereof held to be invalid.

20.2 Modification; Waivers. Except as expressly provided herein, this Agreement may be modified or amended only with the written consent of each party hereto. Neither party hereto shall be released from its obligations hereunder without the written consent of the other party. The observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) by the party entitled to enforce such term, but any such waiver shall be effective only if in a writing signed by the party against which such waiver is to be asserted. Except as otherwise specifically provided herein, no delay on the part of either party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of either party hereto of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

20.3 Succession. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and other legal representatives and, to the extent that any assignment hereof is permitted hereunder, their assignees.

20.4 Counterparts. This Agreement may be executed in counterparts. Each counterpart, including a signature page executed by each of the parties hereto, shall be an original counterpart of this Agreement, but all of such counterparts together shall constitute one instrument.

20.5 Further Assurances. Each party agrees to provide any additional documents and take any such further action as may be reasonably requested by the other party in order to carry out the purpose and intent of this Agreement.

20.6 Entire Agreement. This Agreement contains the full and complete undertaking and agreement among the parties hereto with respect to the within subject matter, and supersedes all other agreements between Cabot on the one hand, and Davies, Donn Davies, or JoAnn Davies on the other, whether written or oral except any confidentiality agreements between the parties, which shall, to the extent such agreements do not contradict the terms of this Agreement, continue in effect.

20.7 Headings. The headings of the sections and other subdivisions of this Agreement are for convenient reference only. They shall not be used in any way to govern, limit, modify, construe this Agreement or any part or provision thereof nor otherwise be given any legal effect.

20.8 Assignees and Third Parties. This Agreement may not be assigned by either party without the prior written consent of the other party and any attempted assignment without such consent shall be null and void; provided, however, that Cabot may assign this Agreement to a subsidiary or affiliated company.

20.9 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to principles of conflicts or choice of laws of Massachusetts or of any other jurisdiction.

20.10 Force Majeure. Each of the parties hereto shall be excused from delays in performing or from failure to perform hereunder to the extent that such delays or failures result from causes beyond the reasonable control of such party; provided that, in order to be excused from delay or failure to perform, such party must act diligently to remedy the cause of such delay or failure.

[remainder of page intentionally left blank]

IN WITNESS WHEREOF, the parties hereto have set their hands to this Agreement as a sealed instrument and have delivered this Agreement as of the day and year first above written.

DAVIES-IMPERIAL COATINGS, INC.

By:  /s/  Donn Davies
     ------------------------------------
Its:  President

CABOT CORPORATION

By:  /s/  Matthew Neville
     ------------------------------------
Its:  Vice President and General Manager

Solely for purposes of Sections 10.1, 11, 13.4, 15, 18, 19, 20.6 and 20.9:

/s/  Donn Davies
------------------------------------
Donn Davies

Solely for purposes of Sections 10.1, 11, 13.4, 15, 18, 19, 20.6 and 20.9:

/s/  JoAnn Davies
------------------------------------
JoAnn Davies

    PRODUCT           FORMULA                 CONTROL PLAN                   SPECIFICATION          DAVIES TEST METHODS
                  (REVISION DATE)     EFFECTIVE DATE/ REVISION LEVEL)      (SPECIFICATION NO./       (TEST METHOD NUMBER)
                                                                             REVISION DATE)
[     ]               9/19/96                 8-5-96, Rev A                       [ ]                101, 200, 300, 302
[     ]               5/04/95                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               9/27/94                4-28-98, Rev B                       [ ]                101, 200, 300, 302
[     ]              10/07/94                 6-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               9/18/96                 6-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               3/28/95                 5-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7-10-98                 5-1-97, Rev A                       [ ]                     101, 300
[     ]               5/04/95                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/5/94                  8-5-96, Rev A                       [ ]                101, 200, 300, 302
[     ]               2/1/93                 10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/5/93                 10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/6/94                 10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/16/93                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               9/27/94                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]              11/18/93                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               5/16/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/6/94                 10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/6/94                 10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               8/23/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               8/23/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               8/23/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               9/18/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               8/23/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               1/12/96                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               1/12/96                 5-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               5/04/95                4-28-98, Rev B                       [ ]             101, 200, 300, 302, 600
[     ]             12-June-98                8-5-96, Rev A                       [ ]             101, 200, 300, 302, 600
[     ]               5/4/95                 4-28-98, Rev B                       [ ]             101, 200, 300, 302, 600
[     ]               5/13/97                10-1-97, Rev A                       [ ]                101, 200, 300, 302
[     ]               7/11/97                 5-1-97, Rev A                       [ ]             101, 200, 300, 302, 400,
                                                                                                          600, 606
[     ]               5/17/96                      N/A                            [ ]             101, 200, 300, 302, 500
[     ]               5/17/96                 8-5-96, Rev A                       [ ]             101, 200, 300, 302, 500
[     ]               3/21/96                      N/A                            [ ]             101, 200, 300, 302, 500
[     ]               5/23/96                 8-5-96, Rev A                       [ ]             101, 200, 300, 302, 501

[     ]               7/02/96                 5-1-97, Rev A                       [ ]             101, 200, 300, 302, 501
[     ]               9/19/96                 8-5-96, Rev A                       [ ]                101, 200, 300, 302
[     ]              12/18/96                 8-5-96, Rev A                       [ ]                101, 200, 300, 302
[     ]               9/19/96                 8-5-96, Rev A                       [ ]                101, 200, 300, 302

                                                                                           Price/Lb.,
                                                                                               F.O.B.
                                                                                           Hammond, IN
Product                                      Weight per 55-gal. Drum
[     ]                                      516                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      491                                              $[     ]
[     ]                                      531                                              $[     ]
[     ]                                      505                                              $[     ]
[     ]                                      506                                              $[     ]
[     ]                                      492                                              $[     ]
[     ]                                      548                                              $[     ]
[     ]                                      509                                              $[     ]
[     ]                                      516                                              $[     ]
[     ]                                      506                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      499                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      500                                              $[     ]
[     ]                                      548                                              $[     ]
[     ]                                      492                                              $[     ]
[     ]                                      495                                              $[     ]
[     ]                                      492                                              $[     ]
[     ]                                      613                                              $[     ]
[     ]                                      489                                              $[     ]
[     ]                                      493                                              $[     ]
[     ]                                      536                                              $[     ]
[     ]                                      536                                              $[     ]

[     ]                                      531                                              $[     ]
[     ]                                      504                                              $[     ]
[     ]                                      489                                              $[     ]
[     ]                                      480                                              $[     ]
[     ]                                      480                                              $[     ]
[     ]                                      480                                              $[     ]
[     ]                                      480                                              $[     ]
[     ]                                      480                                              $[     ]
[     ]                                      516                                              $[     ]
[     ]                                      515                                              $[     ]

Monthly Storage                              $[     ]

Monthly Equipment Maintenance                $[     ]

Sample preparation
   25 or less                                $[     ]
   over 25                                   $[     ]

Hazardous Material Labeling Charge           $[     ]

Dangerous Goods Preparation                  $[     ]

Palletizing with 6-way bands                 $[     ]

Pallets for Bracing Intel Tote Loads         $[     ]

Drum Condoms
   single                                    $[     ]
   double                                    $[     ]

Power Washing
  Regular                                    $[     ]
  Wash and Insert Dip-Tubes                  $[     ]

Aurora Delivery via Davies truck             $[     ]



Recertify Totes and install certification
placard                                      $[     ]

Install metal [ ] Placards on totes $[ ]

Rebills $$[ ] per invoice

              DESCRIPTION                        QUANTITY

10,000 pound Cardinal Scale                          1
500 pound scale                                      1
75 pound scale                                       1
[     ]                                              5
[     ]                                              5
[     ]                                             10
Clean filling room                                   2
36,000 BTU air conditioners                          4
24,000 BTU air conditioners                          2
200,000 BTU furnaces                                 2
York air handler                                     2
Stainless steel power washers                        5
Brass power washer                                   1
[     ]                                              1
[     ]                                              1
[     ]                                              3
Single housing filter unit                           8
Double housing filter units                          5
[     ]                                              1
[     ]                                              1
[     ]                                              1
[     ]                                              1
[     ]                                              1
[     ]                                              3
[     ]                                              6
Bag dump/compactor units                             4
RO equipment only (excludes instrumentation)         1
Mettler Toledo density meter                         1
[     ]                                              1
Weber label printers                                 2
VWR lab oven                                         1
[     ]                                              1
[     ]                                              2
And lab balance                                      1

[Letterhead of Fried, Frank, Harris, Shriver & Jacobson]

January 20, 2000                                            Writer's Direct Line
                                                            212-859-8689
                                                            (FAX: 212-859-8589)

BY ELECTRONIC TRANSMISSION

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Re: Cabot Microelectronics Corporation

Ladies and Gentlemen:

On behalf of Cabot Microelectronics Corporation, a Delaware corporation (the "Company"), and pursuant to the Securities Act of 1933, as amended, we are filing by direct electronic transmission the Company's Registration Statement on Form S-1 (the "Registration Statement") relating to the registration of the Company's common stock. Except as noted on the Registration Statement, all of the exhibits are included within the direct electronic transmission.

The filing fee of $19,800 was paid by intrabank transfer to the Securities and Exchange Commission, Account Number 910-8739, Mellon Bank of Pittsburgh, Pennsylvania, ABA No. 043000261 on January 19, 2000.

Please direct any questions or comments that the Staff may have with regard to the filing to Thomas Christopher at (212) 859-8831, Gregory Gibson at
(212) 859-8106 or to the undersigned at the above-referenced number.

Very truly yours,

/s/ Joshua Wechsler
-------------------
Joshua Wechsler

Encls.

cc: Matthew Neville
Cabot Microelectronics Corporation

Exhibit 10.14

CABOT MICROELECTRONICS CORPORATION
2000 EQUITY INCENTIVE PLAN

1. PURPOSE

The purpose of this 2000 Equity Incentive Plan (the "Plan") is to advance the interests of Cabot Microelectronics Corporation (the "Company") and its stockholders by enhancing the Company's ability to (a) attract and retain employees, directors, consultants and advisors who are in a position to make significant contributions to the success of the Company and its subsidiaries;
(b) reward these individuals for these contributions; (c) encourage these individuals to take into account the long-term interests of the Company and its stockholders; and (d) reward individuals who have contributed to the Company's success (including the success of the Company's initial public offering), in the case of each of (a) through (d), through ownership of shares of the Company's common stock, par value $.001 per share ("Stock").

2. ADMINISTRATION

(a) Prior to the "IPO Effective Date" (as defined in the Master Separation Agreement, dated March 28, 2000, to which the Company is a party (the "Master Separation Agreement")), the Plan shall be administered by the Board of Directors of Cabot Corporation and the Board of Directors of the Company, or either of them, and, from and after the IPO Effective Date, the Plan shall be administered by the Compensation Committee of the Board of Directors (the "Board") of the Company (the entity that administers the Plan, the "Committee"). The Committee shall hold meetings at such times as may be necessary for the proper administration of the Plan. The Committee shall keep minutes of its meetings. If the Committee consists of more than one member, a quorum shall consist of not fewer than two members of the Committee and a majority of a quorum may authorize any action. Any decision or determination reduced to writing and signed by a majority of all of the members of the Committee shall be as fully effective as if made by a majority vote at a meeting duly called and held. The Committee shall consist of at least one director of the Company and may consist of the entire Board; provided, however, that, from and after the IPO Effective Date, (i) if the Committee consists of less than the entire Board, then, with respect to any Committee action relating to an Employee who is subject to Section 16 of the Securities Exchange Act of 1934, as amended (the "1934 Act"), the Committee shall consist of at least two directors of the Company, each of whom shall be a "Non-Employee Director" as defined in Rule 16b-3(b)(3) promulgated thereunder, and (ii) to the extent necessary for any Award intended to qualify as "qualified performance-based compensation" under
Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), to so qualify, each member of the Committee shall be an "outside director" (as defined in Section 162(m) and the regulations promulgated thereunder). For purposes of the preceding sentence, if one or more members of the Committee is neither a Non-Employee Director nor an outside director and is recused or abstains from voting with respect to an action taken by the Committee, then the Committee, with respect to that action, shall be deemed to consist only of the members of the Committee who are not so

recused and who have not abstained from voting. Subject to applicable law, the Committee may delegate its authority under the Plan to any other person or persons.

(b) No member of the Committee shall be liable for any action, failure to act, determination or interpretation made in good faith with respect to this Plan or any transaction hereunder. The Company hereby agrees to indemnify each member of the Committee for all costs and expenses and, to the fullest extent permitted by applicable law, any liability incurred in connection with defending against, responding to, negotiating for the settlement of or otherwise dealing with any claim, cause of action or dispute of any kind arising in connection with any actions in administering this Plan or in authorizing or denying authorization to any transaction hereunder.

(c) Subject to the express terms and conditions set forth herein, the Committee shall have the power from time to time:

(i) to determine the Employees to whom Awards shall be granted under the Plan and the number of shares of Stock subject to such Awards; to prescribe the terms and conditions (which need not be identical) of each such Award; and to make any amendment or modification to any Award Agreement consistent with the terms of the Plan;

(ii) to construe and interpret the Plan and the Awards granted hereunder; to establish, amend and revoke rules and regulations for the administration of the Plan, including, but not limited to, correcting any defect or supplying any omission, or reconciling any inconsistency in the Plan or in any Award Agreement, in the manner and to the extent it shall deem necessary or advisable; to interpret the Plan and applicable Award Agreements so that the Plan and its operation complies with Section 16 of the 1934 Act, Sections 162(m) and 422 of the Code and other applicable law; and otherwise to give full effect to the Plan;

(iii) to exercise its discretion with respect to the powers and rights granted to it as set forth in the Plan; and

(iv) generally, to exercise such powers and to perform such acts as are deemed by it necessary or advisable to promote the best interests of the Company with respect to the Plan.

All decisions and determinations of the Committee in the exercise of the foregoing powers shall be final, binding and conclusive upon the Company, its affiliates, all Employees and all other persons claiming any interest herein.

3. EFFECTIVE DATE AND TERM OF PLAN

The Plan will become effective on the date on which it is adopted by the Board, subject to the approval of Cabot Corporation as the sole stockholder of the Company. No Award may be granted under the Plan after the tenth anniversary of the date on which this Plan was adopted by the Board, but Awards previously granted may extend beyond that date.

4. SHARES SUBJECT TO THE PLAN

Subject to adjustment as provided in Section 8.6, and subject to the next following sentence and Section 6.3(a), the maximum number of shares of Stock that may be delivered under the Plan will be (a) 3,500,000 shares of Stock; plus (b) any shares of Stock subject to Awards granted under the Plan and thereafter forfeited; plus (c) without duplication for shares counted under the immediately preceding clause, a number of shares of Stock equal to the number of shares repurchased by the Company in the open market or otherwise and having an aggregate repurchase price no greater than the amount of cash proceeds received by the Company from the sale of shares of Stock under the Plan; plus (d) any shares of Stock surrendered to the Company in payment of the exercise price of Options issued under the Plan. However, in no event shall the Company issue ISOs (as defined in Section 6.2(a)) under the Plan covering more than 1,750,000 shares of Stock.

Stock delivered under the Plan may be either from authorized but unissued Stock, from treasury shares or from shares of Stock purchased in open-market transactions and private sales.

5. ELIGIBILITY AND PARTICIPATION

Those eligible to receive Awards under the Plan will be employees, directors, consultants and advisors of the Company or any of its affiliates ("Employees") who, in the opinion of the Committee, are in a position to make a significant contribution to the success of the Company and its subsidiaries. An "affiliate" for purposes of the Plan is an entity that controls, is controlled by or is under common control with, the Company. A "subsidiary" for purposes of the Plan is an entity in which the Company owns, directly or indirectly, equity interests possessing a majority of the total combined voting power of all classes of equity. The Committee will from time to time select the Employees who are to be granted Awards ("Participants"), but no Participant shall receive Awards under the Plan covering more than 300,000 shares of Stock (subject to adjustment as provided in Section 8.6) in any calendar year.

6. TYPES OF AWARDS

6.1. RESTRICTED STOCK.

(a) Nature of Restricted Stock Award. An Award of Restricted Stock entitles the recipient to acquire, at such time or times as the Committee may determine, shares of Stock subject to the restrictions described in paragraph
(d) below ("Restricted Stock"). The Committee may require, as a condition to an Award of Restricted Stock, that an Employee deliver to the Company a purchase price in any amount set by the Committee for such Restricted Stock. In no event shall the Company issue more than 875,000 shares of Restricted Stock under the Plan.

(b) Payment for Restricted Stock. In the discretion of the Committee, an Award Agreement evidencing an Award of Restricted Stock may permit the Participant to pay some or all of the purchase price thereof, or to meet any Withholding Requirements to be met by the Participant in connection therewith, in the form of a note from the Participant on such terms as

the Committee shall determine. Such terms may include forgiveness of all or a portion of any such note upon such conditions as the Committee may specify.

(c) Rights as a Stockholder. A Participant who receives an Award of Restricted Stock will have all the rights of a stockholder with respect to the Stock, including voting and dividend rights, subject to the restrictions described in paragraph (d) below and any other conditions imposed by the Committee in the Award Agreement at the time of grant.

(d) Restrictions. The restrictions on each grant of Restricted Stock will lapse at such time or times, and on such terms and conditions (including obtaining pre-established performance goals), as the Committee may specify. Except as otherwise specifically provided by the Plan or by the Committee in any particular case, until these restrictions lapse, Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of, except that Restricted Stock may be pledged as security for the purchase price thereof, or for loans used to fund any or all of the purchase price thereof or Withholding Requirements met in connection with the purchase thereof. If the Participant ceases to be an Employee before such restrictions have lapsed, the Company shall have the right to repurchase the Restricted Stock for the amount of any consideration (excluding services) it received for the Restricted Stock plus, if the Committee shall so determine, an amount equal to the Withholding Requirements met by the Participant in connection with the sale of the Stock, or for such other consideration as the Committee shall determine, including for no consideration if no consideration other than services was paid for such Restricted Stock. The Committee shall not accelerate the time at which the restrictions on all or any part of a grant of Restricted Stock will lapse, except as the Committee may determine to be appropriate in connection with a Participant's termination as an Employee.

6.2. OPTIONS.

(a) Nature of Options. An Option is an Award entitling the recipient on exercise thereof to purchase shares of Stock at a specified exercise price. Both incentive stock options (as defined in Section 422 of the Code) ("ISOs") and Options that are not ISOs may be granted under the Plan.

(b) Exercise Price. The exercise price of an Option shall be determined by the Committee and set forth in an applicable Award Agreement; provided, however, that the exercise price of an ISO shall not be less than the Fair Market Value of a share of the Stock on the date the ISO is granted (110% of the Fair Market Value of a share of Stock on the date of grant in the case of an ISO granted to an Employee who owns (within the meaning of Section 422(b)(6) of the Code) stock possessing more than ten percent of the total combined voting power of all classes of stock of the Company, or of a parent or a subsidiary (such person, a "Ten Percent Shareholder")). For purposes of this Plan, "Fair Market Value" on any date means the closing sales price of the Stock on such date on the principal national securities exchange on which the Stock is listed or admitted to trading, or, if the Stock is not so listed or admitted to trading, the average of the per share closing bid price and per share closing asked price on such date as quoted on the National Association of Securities Dealers Automated Quotation System or such other market in which such prices are regularly quoted, or, if there have been no published bid or

asked quotations with respect to shares on such date, the Fair Market Value shall be the value established by the Board in good faith and, in the case of an ISO, in accordance with Section 422 of the Code; provided that the "Fair Market Value" of any Option granted prior to the IPO Effective Date shall be the initial public offering price of the Stock.

(c) Duration of Options. The latest date on which an Option may be exercised will be the tenth anniversary of the date the Option was granted (five years in the case of an ISO granted to a Ten Percent Shareholder), or such earlier date as may have been specified by the Committee in the Award Agreement at the time the Option was granted.

(d) Exercise of Options. An Option will become exercisable at such time or times, and on such terms and conditions (including obtaining pre-established performance goals), as the Committee may specify in the Award Agreement for such Option. The Committee may at any time accelerate the time at which all or any part of the Option may be exercised.

Subject to the next following sentence, any exercise of an Option must be in writing, signed by the proper person and delivered or mailed to the Company, accompanied by (1) any documents required by the Committee and (2) payment in full for the number of shares for which the Option is exercised. The exercise price for any Stock purchased pursuant to the exercise of an Option may, if permitted under the Award Agreement applicable to the Option, be paid in the following forms: (a) cash; (b) the transfer, either actually or by attestation, to the Company of shares of Stock that have been held by the Participant for at least six months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Option, such transfer to be upon such terms and conditions as determined by the Committee; or (c) a combination thereof. In addition, Options may be exercised through a registered broker-dealer pursuant to such cashless exercise procedures which are, from time to time, deemed acceptable by the Committee. Any shares of Stock transferred to the Company as payment of the exercise price under an Option shall be valued at their Fair Market Value on the day of exercise of such Option. If requested by the Committee, the Participant shall deliver the Award Agreement to the Secretary of the Company who shall endorse thereon a notation of such exercise and return such Award Agreement to the Participant. No fractional shares of Stock (or cash in lieu thereof) shall be issued upon exercise of an Option, and the number of shares of Stock that may be purchased upon exercise shall be rounded to the nearest number of whole shares.

(e) To the extent that the aggregate Fair Market Value (determined as of the date of the grant) of shares of Stock with respect to which ISOs granted under the Plan and "incentive stock options" (within the meaning of Section 422 of the Code) granted under all other plans of the Company or its subsidiaries (in either case determined without regard to this Section 6.2(e)) are exercisable by a Participant for the first time during any calendar year exceeds $100,000, such ISOs shall be treated as Options which are not ISOs. In applying the limitation in the preceding sentence in the case of multiple Options, Options which are intended to be ISOs shall be treated as Options which are not ISOs according to the order in which they were granted, such that the most recently granted Options are first treated as Options which are not ISOs.

6.3. SUBSTITUTE AWARDS.

(a) The Committee may grant Awards to Employees who hold outstanding awards of stock options and restricted stock granted under the equity incentive awards of Cabot Corporation (the "Cabot Awards"), in cancellation of the Cabot Awards. It is intended that such Awards shall preserve for the Participants the economic values of the equity incentives for which such Awards are substituted and shall be subject to substantially similar terms of conditions as the Cabot Awards (but any such Awards shall reflect the performance of the Stock and not the performance of Cabot common stock), in each case as determined by the Committee in its sole discretion. Any cancellation of a Cabot Award pursuant to this Section 6.3(a) shall be subject to the terms of such Cabot Award.

(b) In connection with any acquisition by the Company or any of its subsidiaries, the Committee may grant Awards to persons who became Employees in connection with such acquisition in substitution for equity incentives held by them in the seller or acquired entity. In such case the Committee may set the prices and other terms of the substitute Awards at such amounts and in such manner as it, in its sole discretion, deems appropriate to preserve for the Participants the economic values of the equity incentives for which such Awards are substitutes (as determined by the Committee in its sole discretion) or otherwise to provide such incentives as the Committee may determine are appropriate.

(c) Unless required by applicable law, any substitute Awards granted pursuant to Section 6.3 shall not count toward the share limitations set forth in Section 4.

7. EVENTS AFFECTING OUTSTANDING AWARDS

7.1. TERMINATION OF EMPLOYMENT.

Except as set forth in an applicable Award Agreement, after a Participant ceases to be an Employee, (i) Options held by a Participant shall not be exercisable and all rights of the Participant with respect thereto shall terminate, and (ii) shares of Restricted Stock with respect to which the restrictions have not lapsed shall be immediately forfeited and must be transferred to the Company in accordance with Section 6.1.

7.2 CHANGE IN CONTROL.

The Committee shall have the discretion to provide in applicable Award Agreements that, in the event of a "Change in Control" (as defined in Appendix
A) of the Company, the following provisions will apply:

(a) Each outstanding Option (or such lesser portion of each Option as is set forth in an applicable Award Agreement) will immediately become exercisable in full.

(b) Each outstanding share of Restricted Stock (or such lesser number of shares as is set forth in an applicable Award Agreement) will immediately become free of the restrictions.

(c) In the event of a Change in Control which is a merger or consolidation in which the Company is not the surviving corporation or which results in the acquisition of substantially all the Company's outstanding Stock by a single person or entity or by a group of persons or entities acting in concert, or in the event of a sale or transfer of all or substantially all of the Company's assets (a "Covered Transaction"), for the termination of all outstanding Options as of the effective date of the Covered Transaction, subject to the following: If the Covered Transaction follows a Change in Control or would give rise to a Change in Control, no Option will be so terminated (without the consent of the Participant) prior to the expiration of 20 days following the later of (i) the date on which the Award became fully exercisable and (ii) the date on which the Participant received written notice of the Covered Transaction.

8. GENERAL PROVISIONS

8.1. DOCUMENTATION OF AWARDS.

Awards will be evidenced by written instruments prescribed by the Committee from time to time (each such instrument, an "Award Agreement"). Award Agreements may be in the form of agreements, to be executed by both the Participant and the Company, or certificates, letters or similar instruments, acceptance of which will evidence agreement to the terms thereof and hereof.

8.2. RIGHTS AS A STOCKHOLDER; DIVIDEND EQUIVALENTS.

Except as specifically provided by the Plan, the receipt of an Award will not give a Participant rights as a stockholder, and the Participant will obtain such rights, subject to any limitations imposed by the Plan or the Award Agreement, upon actual receipt of Stock. However, the Committee may, on such conditions as it deems appropriate, provide in an Award Agreement that a Participant will receive a benefit in lieu of cash dividends that would have been payable on any or all Stock subject to the Participant's Award had such Stock been outstanding. Without limitation, the Committee may provide for payment to the Participant of amounts representing such dividends, either currently or in the future, or for the investment of such amounts on behalf of the Participant.

8.3 CONDITIONS ON DELIVERY OF STOCK.

The Company will not be obligated to deliver any shares of Stock pursuant to the Plan or to remove any restriction from shares of Stock previously delivered under the Plan (a) until all conditions of the Award have been satisfied or removed, (b) until, in the opinion of the Company's counsel, all applicable federal and state laws and regulations have been complied with,
(c) if the outstanding Stock is at the time listed on any stock exchange, until the shares to be delivered have been listed or authorized to be listed on such exchange upon official notice of notice of issuance and (d) until all other legal matters in connection with the issuance and delivery of such shares have been approved by the Company's counsel. If the sale of Stock has not been registered under the Securities Act of 1933, as amended, the Company may require, as a condition to exercise of the Award, such representations or agreements as counsel for the

Company may consider appropriate to avoid violation of such Act and may require that the certificates evidencing such Stock bear an appropriate legend restricting transfer.

8.4. TAX WITHHOLDING.

The Company will withhold from any payment made pursuant to an Award an amount as may be necessary sufficient to satisfy all minimum federal, state and local withholding tax requirements (the "Withholding Requirements").

The Committee will have the right to require that the Participant or other appropriate person remit to the Company an amount sufficient to satisfy the Withholding Requirements, or make other arrangements satisfactory to the Committee with regard to such requirements, prior to the delivery of any Stock. If and to the extent that any such withholding is required, the Committee may permit the Participant or such other person to elect at such time and in such manner as the Committee provides to have the Company hold back from the shares to be delivered, or to deliver to the Company, Stock having a value calculated to satisfy the Withholding Requirements.

If at the time an ISO is exercised the Committee determines that the Company could be liable for Withholding Requirements with respect to a disposition of the Stock received upon exercise, the Committee may require as a condition of exercise that the person exercising the ISO agree (a) to inform the Company promptly of any disposition of Stock received upon exercise of the ISO, and (b) to give such security as the Committee deems adequate to meet the potential liability of the Company for the Withholding Requirements and to augment such security from time to time in any amount reasonably deemed necessary by the Committee to preserve the adequacy of such security.

8.5. NONTRANSFERABILITY OF AWARDS.

No Option shall be transferable by a Participant otherwise than by will or by the laws of descent and distribution or, in the case of an Option other than an ISO, pursuant to a domestic relations order (within the meaning of Rule 16a-12 promulgated under the Exchange Act), and an Option shall be exercisable during the lifetime of such Participant only by such Participant or such Participant's executor or administrator or by the person or persons to whom the Option is transferred by will or the applicable laws of descent and distribution (such person, the Participant's "Legal Representative"). Notwithstanding the foregoing sentence, the Committee may set forth in an Award Agreement evidencing an Option (other than an ISO), that the Option may be transferred to members of the Participant's immediate family, to trusts solely for the benefit of such immediate family members and to partnerships in which such family members and/or trusts are the only partners, and for purposes of this Plan, such a transferee of an Option shall be deemed to be the Participant. For this purpose, "immediate family" shall refer only to the Participant's spouse, parents, children, stepchildren and grandchildren and the spouses of such parents, children, stepchildren and grandchildren. The terms of an Option shall be final, binding and conclusive upon the beneficiaries, executors, administrators, heirs and successors of the Participant.

8.6. ADJUSTMENTS IN THE EVENT OF CERTAIN TRANSACTIONS.

In the event that the outstanding shares of Stock are changed into or exchanged for a different number or kind of shares of stock, other securities or other property of the Company, an affiliate or another legal entity, whether through merger, consolidation, reorganization, recapitalization, stock dividend, stock split-up or other substitution of securities of the Company, an affiliate or another entity, the Committee shall make appropriate adjustments to the maximum number and kind of shares of stock or other equity interest as to which Awards may be granted under the Plan and the number and kind of shares of stock or other equity interest with respect to which Awards have been granted under the Plan, the exercise prices for such shares or other equity interest subject to Options and any other economic terms of Awards granted under the Plan; and provided, that, in the event of a merger of the Company with or into another entity, any adjustment provided for in the applicable agreement and plan of merger (or similar document) shall be conclusively deemed to be appropriate for purposes of this Section 8.6. The Committee's adjustment shall be final and binding for all purposes of the Plan and each Award Agreement entered into under the Plan. Unless the Committee otherwise determines, no adjustment provided for in this Section 8.6 shall require the Company to issue a fractional share, and, in such event, with respect to each Award Agreement the total adjustment as to the number of shares for which Awards have been granted shall be effected by rounding down to the nearest whole number of shares.

8.7. EMPLOYMENT RIGHTS.

Neither the adoption of the Plan nor the grant of Awards will confer upon any person any right to continued employment with the Company or any subsidiary or affect in any way the right of the Company or affiliate to terminate an employment relationship at any time.

8.8. PAYMENT FOR STOCK; LOANS.

Stock awarded under this Plan as Restricted Stock or received upon exercise of an Option may be paid for with such legal consideration as the Committee may determine. If and to the extent authorized by the Committee, the Company may permit Participants to pay for Stock with promissory notes, and may make loans to Participants of all or a portion of any Withholding Requirements to be met in connection with the grant, exercise or vesting of any Award. Any such extensions of credit may be secured by Stock or other collateral, or may be made on an unsecured basis, as the Committee may determine.

9. DISCONTINUANCE, CANCELLATION, AMENDMENT AND TERMINATION

The Committee may at any time discontinue granting Awards under the Plan. The Board may at any time or times amend the Plan and, with the consent of the holder thereof, any outstanding Award. The Committee may at any time terminate the Plan as to any further grants of Awards, provided that (except to the extent expressly required or permitted by the Plan) no such amendment will, without the approval of the stockholders of the Company, (a) increase the maximum number of shares available under the Plan, (b) extend the time within which Awards may be granted, or (c) amend the provisions of this Section 9, and no amendment or termination

of the Plan may adversely affect the rights of any Participant (without his or her consent) under any Award previously granted.

CABOT MICROELECTRONICS CORPORATION

By /s/ Matthew Neville
   --------------------------

APPENDIX A

A "Change in Control" shall be deemed to have occurred if, following the "Distribution" (as defined in the Master Separation Agreement):

(a) any "person" as such term is used in Sections 13(d) and 14(d) of the 1934 Act (other than (i) the Company, (ii) any subsidiary of the Company,
(iii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company or of any subsidiary of the Company, or (iv) any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes the "beneficial owner" (as defined in Section 13(d) of the 1934 Act), together with all Affiliates and Associates (as such terms are used in Rule 12b-2 of the General Rules and Regulations under the 1934 Act) of such person, directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of the Company's then outstanding securities; or

(b) the stockholders of the Company approve a merger or consolidation of the Company with any other company, other than (i) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any subsidiary of the Company, at least 65% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) after which no "person" (with the method of determining "beneficial ownership" used in clause (a) of this definition) owns more than 25% of the combined voting power of the securities of the Company or the surviving entity of such merger or consolidation; or

(c) during any period of two consecutive years (not including any period prior to the execution of the Plan), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has conducted or threatened a proxy contest, or has entered into an agreement with the Company to effect a transaction described in clause (a), (b) or (d) of this definition) whose election by the Board or nomination for election by the Company's stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to constitute at least a majority thereof; or

(d) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company's assets.

1.01  Purpose. The purpose of the Cabot Microelectronics Corporation Employee
      Stock Purchase Plan (the "Plan") is to provide employees of Cabot
      Microelectronics Corporation (the "Company") and its Designated Subsidiary
      Corporations with an opportunity to purchase Common Stock of the Company
      through accumulated payroll deductions.


1.02  Rules of Interpretation. It is the intention of the Company to have the
      Plan qualify as an "employee stock purchase plan" under Section 423 of the
      Internal Revenue Code of 1986, as amended (the "Code"), and the provisions
      of the Plan, accordingly, shall be construed so as to extend and limit
      participation in a manner consistent with the requirements of that section
      of the Code; provided, however, that the Committee shall have the
      discretion to cause the options granted in one or more Offering Periods
      under the Plan to be options to which Section 423 of the Code does not
      apply.

2.02  "Change in Capitalization" shall mean any increase or reduction in the
      number of shares of Common Stock, or any change (including, but not
      limited to, in the case of a spin-off, dividend or other distribution in
      respect of shares of Common Stock, a change in value) in the shares of
      Common Stock or exchange of shares of Common Stock for a different number
      or kind of shares, other equity interests or other property of the Company
      or another entity, by reason of a reclassification, recapitalization,
      merger, consolidation, reorganization, spin-off, split-up, issuance of
      warrants or rights or debentures, stock dividend, stock split or reverse
      stock split, cash dividend, property dividend, combination or exchange of
      shares, repurchase of shares, change in corporate structure or otherwise.

2.03 "Change in Control" shall be as defined in Appendix A.

2.04 "Code" shall mean the Internal Revenue Code of 1986, as amended.

2.05 "Common Stock" shall mean the Common Stock of the Company.

2.06  "Company" shall mean Cabot Microelectronics Corporation, a Delaware
      corporation.


2.07  "Compensation" shall mean the gross cash compensation (including base
      salary, shift premium, overtime earnings and cash bonuses exclusive of
      relocation and sign-on bonuses) paid by the Company or a Designated
      Subsidiary Corporation in accordance with the terms of employment, but
      excluding all bonus payments, expense allowances and compensation paid in
      a form other than cash.

2.08 "Committee" shall mean the committee described in Article XI.

2.09  "Designated Subsidiary Corporation" shall mean any Subsidiary of the
      Company which has been designated by the Committee from time to time in
      its sole discretion as eligible to participate in the Plan.


2.10  "Employee" shall mean any individual who is a common law employee of the
      Company or a Designated Subsidiary Corporation for tax purposes whose
      customary employment with the Company is at least twenty (20) hours per
      week and more than five (5) months in any calendar year.

2.11 "Enrollment Date" shall mean the first day of each Offering Period.

2.12 "Exercise Date" shall mean the last day of each Offering Period.

2.13  "Fair Market Value" shall mean, as of any date, the value of a share of
      Common Stock determined as follows:


      2.13.1  If the Common Stock is listed on any established stock exchange or
              a national market system, including without limitation the Nasdaq
              National Market or The Nasdaq SmallCap Market of The Nasdaq Stock
              Market, its Fair Market Value shall be the closing sales price for
              a share of Common Stock (or the closing bid, if no sales were
              reported) as quoted on such exchange or system on the date of such
              determination, as reported in The Wall Street Journal or such
              other source as the Committee deems reliable, or;


      2.13.2  If the Common Stock is regularly quoted by a recognized securities
              dealer but selling prices are not reported, its Fair Market Value
              shall be the mean of the closing bid and asked prices for a share
              of the Common Stock on the date of such determination, as reported
              in The Wall Street Journal or such other source as the Committee
              deems reliable, or;

      2.13.3  In the absence of an established market for the Common Stock, the
              Fair Market Value of a share thereof shall be determined in good
              faith by the Committee.


      2.13.4  Notwithstanding the above, in the case of the first day of the
              initial Offering Period, Fair Market Value shall mean the public
              offering price in the Initial Public Offering.


2.14  "Initial Public Offering" shall mean the first public offering of the
      Common Stock pursuant to the Securities Act of 1933, as amended.


2.15  "Offering Period" shall mean a period of approximately six (6) months
      commencing on the first Trading Day on or after January 1st and
      terminating on the last Trading Day in the period ending the following
      June 30th, or commencing on the first Trading Day on or after July 1st and
      terminating on the last Trading Day in the period ending the following
      December 31st, provided, however, that the first Offering Period under the
      Plan shall commence on the first date on which quotations are available
      for the Common Stock on any established stock exchange or a national
      market system and shall end on a Trading Day selected by the Committee
      consistent with Section 423 of the Code. The duration of Offering Periods
      may be changed pursuant to Sections 13.05 and 13.06.


2.16  "Plan Representative" shall mean any person designated from time to time
      by the Committee to receive certain notices and take certain other
      administrative actions relating to participation in the Plan.


2.17  "Plan" shall mean the Cabot Microelectronics Corporation Employee Stock
      Purchase Plan.


2.18  "Purchase Price" shall mean an amount set by the Committee, but not less
      than the lesser of 85% of the Fair Market Value of a share of Common Stock
      on the Enrollment Date or on the Exercise Date, whichever is lower;
      provided, however, that the Purchase Price may be adjusted by the Board
      pursuant to Section 13.06.


2.19  "Subsidiary" shall mean a corporation, domestic or foreign, of which not
      less than 50% of the voting shares are held by the Company or a
      Subsidiary, whether or not such corporation now exists or is hereafter
      organized or acquired by the Company or a Subsidiary.


2.20  "Trading Day" shall mean a day on which national stock exchanges and the
      Nasdaq System are open for trading.

3.01  Eligibility. Each Employee on an Enrollment Date of an Offering Period
      shall be eligible to participate in such Offering Period. Persons who are
      not Employees shall not be eligible to participate in such Offering
      Period. Employees of Cabot Corporation and its subsidiaries, other than
      the Company and its Designated Subsidiary Corporations, are not eligible
      to participate in the Plan.


3.02  Restrictions on Participation. Notwithstanding any provision of the Plan
      to the contrary, no Employee shall be granted an option to purchase shares
      of Common Stock under the Plan:


      3.02.1  If, immediately after the grant, such Employee would own stock
              and/or hold outstanding options to purchase stock possessing 5% or
              more of the total combined voting power or value of all classes of
              stock of the Company (for purposes of this paragraph, the rules of
              Section 424(d) of the Code shall apply in determining stock
              ownership of any Employee); or


      3.02.2  If such Employee's rights to purchase stock under all employee
              stock purchase plans of the Company accrue at a rate which exceeds
              $25,000 of Fair Market Value of the stock (determined at the time
              such option is granted) for each calendar year in which such
              option is outstanding at any time.


3.03  Commencement of Participation. An Employee may become a participant by
      completing an authorization for payroll deductions on the form provided by
      the Company and filing the completed form with the Plan Representative on
      or before the filing date set therefor by the Committee, which date shall
      be prior to the next Enrollment Date. Payroll deductions for a participant
      shall commence on the next following Enrollment Date after the Employee's
      authorization for payroll deductions becomes effective and shall continue
      until termination of the Plan, the participant's earlier termination of
      participation in the Plan, or the participant's change in payroll
      deductions pursuant to Section 5.03. Each participant in the Plan shall be
      deemed to continue participation until termination of the Plan or such
      participant's earlier termination of participation in the Plan pursuant to
      Article VIII below.

4.01  Stock Subject to the Plan. Subject to the provisions of Section 13.03 of
      the Plan, the Board shall reserve for issuance under the Plan an aggregate
      four hundred seventy-five thousand (475,000) shares of the Company's
      Common Stock, which shares shall be authorized but unissued shares of
      Common Stock, treasury

      shares, or shares of Common Stock purchased by the Company or the Plan on
      an established stock exchange or a national market system.


4.02  Offerings. The Plan will be implemented by two annual offerings of the
      Company's Common Stock each calendar year. Each offering will be
      outstanding during the applicable Offering Period.

5.01  Amount of Deduction. The form described in Section 3.03 will permit a
      participant to elect payroll deductions of any whole percentage from one
      percent (1%) through ten percent (10%) of such participant's Compensation
      for each pay period during an Offering Period.


5.02  Participant's Account. All payroll deductions made for a participant shall
      be credited to an account established for such participant under the Plan.
      A participant may not make any separate cash payment into such account.


5.03  Changes in Payroll Deductions. A participant may reduce or increase future
      payroll deductions (within the limits described in Section 5.01) by filing
      with the Plan Representative a form provided by the Company for such
      purpose. The effective date of any increase or reduction in future payroll
      deductions will be the next following payroll period succeeding processing
      of the change form.

6.01  Number of Option Shares. On an Enrollment Date each participant shall be
      deemed to have been granted an option to purchase a number of shares of
      Common Stock determined by dividing the participant's accumulated payroll
      deductions on the Exercise Date by the lower of (i) 85% of the Fair Market
      Value of a share of Common Stock on the Enrollment Date or (ii) 85% of the
      Fair Market Value of a share of Common Stock on the Exercise Date;
      subject, however, to any applicable limitations contained in this Plan. In
      addition, the maximum number of shares a participant may purchase with
      respect to any Offering Period is that number of shares determined by
      dividing $12,500 by the Fair Market Value of a share of Common Stock on
      the Enrollment Date; provided, however, the maximum number of shares a
      participant may purchase with respect to the first Offering Period is that
      number of shares determined by dividing $25,000 by the Fair Market Value
      of a share of Common Stock on the Enrollment Date.

7.01  Automatic Exercise. Subject to the next following sentence, each Plan
      participant's option for the purchase of stock with payroll deductions
      made during any Offering Period will be exercised automatically on the
      applicable Exercise Date for the purchase of the number of full and deemed
      fractional shares of Common Stock which the accumulated payroll deductions
      in the participant's account at the time will purchase at the Purchase
      Price (but not in excess of the maximum number of shares determined
      pursuant to Section 6.01), and any excess accumulated payroll deductions
      which, but for this limitation, would have been used to purchase shares,
      will be held for the purchase of Common Stock on the next following
      Exercise Date without interest. The Committee shall have the discretion to
      reduce the number of shares of Common Stock to be purchased by
      participants with respect to an Offering Period and to allocate such
      reduced number of shares of Common Stock among participants in such
      Offering Period, so long as such reduction and allocation is done in a
      manner consistent with Section 423 of the Code. Any payroll deductions not
      applied to the purchase of shares of Common Stock by reason of the
      reduction pursuant to this Section 7.01 shall be promptly refunded to
      participants after the Exercise Date of the Offering Period to which such
      reduction applies.


7.02  Withdrawal of Account. No participant in the Plan shall be entitled to
      withdraw any amount from the accumulated payroll deductions in his or her
      account; provided, however, that a participant's accumulated payroll
      deductions shall be refunded to the participant as and to the extent
      specified in Section 8.01 below upon termination of such participant's
      participation in the Plan.


7.03  Fractional Shares. Fractional shares of Common Stock will not be issued
      under the Plan. Any deemed fractional share of Common Stock purchased by a
      Participant pursuant to Section 7.01 hereof will be combined with any
      deemed fractional shares purchased by the Participant in subsequent
      Offering Periods and whole shares of Common Stock then issued therefor.
      The Fair Market Value of all deemed fractional shares shall be paid in
      cash.


7.04  Exercise of Options. During a participant's lifetime, options held by such
      participant shall be exercisable only by such participant.


7.05  Delivery of Stock. As promptly as practicable after each Exercise Date,
      the Company will deliver to each participant the shares of Common Stock
      purchased upon exercise of such participant's option. The Company may
      deliver such shares in certificated or book entry form, at the Company's
      sole election.

8.01  In General. A participant may stop participating in the Plan at any time
      by giving written notice to the Plan Representative. Upon processing of
      any such written notice, no further payroll deductions will be made from
      the participant's Compensation during such Offering Period or thereafter,
      unless and until such participant elects to resume participation in the
      Plan by providing written notice to the Plan Representative pursuant to
      Section 3.03 above. Such participant's payroll deductions accumulated
      prior to processing of such notice shall be applied toward purchasing full
      and deemed fractional shares of Common Stock in the then-current Offering
      Period as provided in Section 7.01 above unless the participant requests
      in writing to have the accumulated payroll deductions and cash in lieu of
      deemed fractional shares returned to him or her.


8.02  Effect on Subsequent Participation. A participant's withdrawal from any
      Offering Period will not have any effect upon such participant's
      eligibility to participate in any succeeding Offering Period or in any
      similar plan which may hereafter be adopted by the Company and for which
      such participant is otherwise eligible.


8.03  Termination of Employment. Upon termination of a participant's employment
      with the Company or any Designated Subsidiary Corporation (as the case may
      be) for any reason, including retirement but excluding death, the
      participant's payroll deductions accumulated prior to such termination, if
      any, shall be applied toward purchasing full and deemed fractional shares
      of Common Stock in the then-current Offering Period so long as the
      Exercise Date with respect to such Offering Period occurs on or within
      three months following such termination; provided, however, that (1) the
      participant may request in writing to have the accumulated payroll
      deductions and cash in lieu of deemed fractional shares returned to him or
      her, and (2) upon termination of a participant's employment with the
      Company or any Designated Subsidiary Corporation (as the case may be) as a
      result of the participant's death, the participant's payroll deductions
      accumulated prior to such termination and cash in lieu of deemed
      fractional shares shall be paid to his or her estate.

9.01  Payment of Interest. No interest will be paid or allowed on any money paid
      into the Plan or credited to the account of or distributed to any
      participant.

                                    ARTICLE X
                                      STOCK

10.01 Participant's Interest in Option Stock. No participant will have any interest in shares of Common Stock covered by any option held by such participant until such option has been exercised as provided in Section 7.01 above.

10.02 Registration of Stock. Shares of Common Stock purchased by a participant under the Plan will be recorded in the name of the participant, or, if the participant so directs by written notice to the Plan Representative prior to the applicable Exercise Date, in the names of the participant and the participant's spouse as joint tenants with rights of survivorship or as tenants by the entireties, to the extent permitted by applicable law.

10.03 Restrictions on Exercise. The Board may, in its discretion, require as conditions to the exercise of any option that the shares of Common Stock reserved for issuance upon the exercise of such option shall have been duly listed, upon official notice of issuance, upon a stock exchange or market, and that either:

10.03.1  a registration statement under the Securities Act of 1933, as
         amended, with respect to said shares shall be effective, or


10.03.2  the participant shall have represented at the time of purchase,
         in form and substance satisfactory to the Company, that it is his
         or her intention to purchase the shares for investment and not
         for resale or distribution.

11.01  Appointment of Committee. The Plan shall be administered by the Board or
       a Committee of members of the Board appointed by the Board. The Board or
       its Committee shall have full and exclusive discretionary authority to
       construe, interpret and apply the terms of the Plan, to determine
       eligibility and to adjudicate all disputed claims filed under the Plan.
       Every finding, decision and determination made by the Board or its
       Committee shall, to the full extent permitted by law, be final and
       binding upon all parties.


11.02  Authority of Committee. Subject to the express provisions of the Plan,
       the Committee shall have plenary authority in its discretion to interpret
       and construe any and all provisions of the Plan, to adopt rules and
       regulations for administering the Plan, and to make all other
       determinations deemed necessary or advisable for administering the Plan.
       The Committee's determination of the foregoing matters shall be
       conclusive. Except as otherwise prohibited by

       applicable law, the Committee may delegate some or all of its authority
       specified herein to the Plan Representative.


11.03  Rules Governing the Administration of the Committee. The Board may from
       time to time appoint members of the Committee in substitution for or in
       addition to members previously appointed and may fill vacancies, however
       caused, in the Committee. The Committee may select one of its members as
       its chairman, shall hold its meetings at such times and places as it
       shall deem advisable, and may hold telephonic meetings. All
       determinations of the Committee shall be made by a majority of its
       members. A decision or determination reduced to writing and signed by a
       majority of the members of the Committee shall be as fully effective as
       if it had been made by a majority vote at a meeting duly called and held.
       The Committee may appoint a secretary and shall make such rules and
       regulations for the conduct of its business as it shall deem advisable.


11.04  Rules and Procedures Applicable to Offering Periods. The Committee shall
       have the authority and discretion to adopt rules and procedures
       applicable to one or more Offering Periods under the Plan. Any such rules
       and procedures shall be established by the Committee and communicated to
       participants in advance of any Offering Period to which they apply. Such
       rules and procedures may, in the discretion of the Committee, cause the
       options granted under any such Offering Period to be options to which
       Section 423 of the Code does not apply.

ARTICLE XII

FOREIGN JURISDICTIONS

Notwithstanding any other provision in this Plan, the Committee may adopt rules or procedures relating to the operation and administration of the Plan to accommodate the specific requirements of local laws and procedures. Without limiting the generality of the foregoing sentence, the Committee is specifically authorized to adopt rules and procedures regarding handling of payroll deductions, payment of interest, conversion of local currency, payroll tax, withholding procedures and handling of stock certificates which vary in accordance with the requirements of such local law and procedures. To the extent that any such rules or procedures are adopted with respect to options granted in an Offering Period to which Section 423 of the Code is intended to apply, the Committee shall cause such rules and procedures to be consistent with Section 423 of the Code.

ARTICLE XIII

MISCELLANEOUS

13.01 Transferability. Neither payroll deductions credited to any participant's account nor any option or other rights with regard to the exercise of an option to receive Common Stock under the Plan may be assigned, transferred, pledged, or

otherwise disposed of in any way by the participant other than by will or the laws of descent and distribution. Any such attempted assignment, transfer, pledge or other disposition shall be without effect except that the Company may, in its discretion, treat such act as an election to withdraw from participation in the Plan in accordance with Section 8.01.

13.02 Use of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose. The Company shall not segregate such payroll deductions.

13.03 Adjustment Upon Changes in Capitalization; Change in Control.

13.03.1     Changes in Capitalization.  Subject to any required action
            by the stockholders of the Company, the Reserves, the
            maximum number of shares each participant may purchase per
            Offering Period (pursuant to Section 6.01), as well as the
            Purchase Price and the number of shares of Common Stock
            covered by each option under the Plan which has not yet
            been exercised shall be proportionately adjusted for any
            Change in Capitalization.  Such adjustment shall be made by
            the Board, whose determination in that respect shall be
            final, binding and conclusive.  Except as expressly
            provided herein, no issuance by the Company of shares of
            stock of any class shall affect, and no adjustment by
            reason thereof shall be made with respect to, the number or
            Purchase Price of shares of Common Stock subject to an
            option.


13.03.2     Change in Control. In the event of a Change in Control, the
            Offering Period during which the Change in Control would
            otherwise occur shall be accelerated and shall end on the last
            payroll date immediately preceding the Change in Control.

13.04 Amendment or Termination. The Board shall have complete power and authority to terminate or amend the Plan; provided, however, that the Board shall not, without the approval of the shareholders of the Company, alter (i) the aggregate number of shares of Common Stock which may be issued under the Plan (except pursuant to Section 13.03 above), or (ii) the class of Employees eligible to receive options under the Plan, other than to designate Subsidiaries as Designated Subsidiary Corporations; and provided further, however, that, subject to Section 13.05 no termination, modification, or amendment of the Plan may, without the consent of an Employee then having an option under the Plan to purchase shares of Common Stock, adversely affect the rights of such Employee under such option. In addition, and notwithstanding anything contained in this Plan to the contrary, to the extent necessary under Section 423 of the Internal Revenue Code (or any successor rule or provision or any applicable law or

regulation), the Company shall obtain stockholder approval in such a manner and to such a degree as so required.

13.05 The Committee shall be entitled to change the Offering Periods, limit the frequency and/or number of changes in the amount withheld during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a participant in order to adjust for delays or mistakes in the Company's processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each participant properly correspond with amounts withheld from the participant's Compensation, and establish such other limitations or procedures as the Board (or its committee) determines in its sole discretion advisable which are consistent with the Plan, in each case so long as any such action is consistent with Section 423 of the Code. None of the foregoing actions shall be considered to have adversely affected any right of any participant.

13.06 In the event that the Committee determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Committee may, in its discretion and, to the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequence including, but not limited to:

13.06.1     changing the Purchase Price for any Offering Period including
            an Offering Period underway at the time of the change in
            Purchase Price;


13.06.2     shortening any Offering Period so that the Offering Period
            ends on a new Exercise Date, including an Offering Period
            underway at the time of such action; and


13.06.3     allocating shares of Common Stock to participants pursuant to
            Section 7.01 hereof.

None of the foregoing actions shall be considered to have adversely affected any right of any participant.

13.07 Notices. All notices or other communications by a participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form specified by the Company by the Plan Representative.

13.08 Conditions Upon Issuance of Shares. Shares shall not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, as

amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the exercise of an option, the Company may require the person exercising such option to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

13.09 Effective Date. The Plan shall become effective as of its adoption by the Board, subject to approval by the holders of a majority of the shares of Common Stock, and shall continue in effect until the shares of Common Stock reserved for issuance under the Plan have been depleted, unless sooner terminated under Section 13.04 hereof. If the Plan is not so approved, the Plan shall not become effective.

13.10 No Employment Rights. The Plan does not, directly or indirectly, create in any person any right with respect to employment or continuation of employment by the Company or any Subsidiary, and it shall not be deemed to interfere in any way with the Company's or any Subsidiary's right to terminate, or otherwise modify, any Employee's employment at any time.

13.11 Effect of Plan. The provisions of the Plan shall, in accordance with its terms, be binding upon, and inure to the benefit of, all successors of each Employee participating in the Plan, including, without limitation, such Employee's estate and the executors, administrators or trustees thereof, heirs and legatees, and any receiver, trustee in bankruptcy or representative of creditors of such Employee.

13.12 Governing Law. The law of the State of Delaware will govern all matters relating to this Plan except to the extent superseded by the federal laws of the United States.

APPENDIX A

A "Change in Control" shall be deemed to have occurred if, following the "Distribution" (as defined in the Master Separation Agreement, dated March 28, 2000, to which the Company and Cabot Corporation are parties):

(a) any "person" as such term is used in Sections 13(d) and 14(d) of the 1934 Act (other than (i) the Company, (ii) any subsidiary of the Company, (iii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company or of

any subsidiary of the Company, or (iv) any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes the "beneficial owner" (as defined in Section 13(d) of the 1934 Act), together with all Affiliates and Associates (as such terms are used in Rule 12b-2 of the General Rules and Regulations under the 1934 Act) of such person, directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of the Company's then outstanding securities; or

(b) the stockholders of the Company approve a merger or consolidation of the Company with any other company, other than (i) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any subsidiary of the Company, at least 65% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) after which no "person" (with the method of determining "beneficial ownership" used in clause (a) of this definition) owns more than 25% of the combined voting power of the securities of the Company or the surviving entity of such merger or consolidation; or

(c) during any period of two consecutive years (not including any period prior to the execution of the Plan), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has conducted or threatened a proxy contest, or has entered into an agreement with the Company to effect a transaction described in clause (a), (b) or (d) of this definition) whose election by the Board or nomination for election by the Company's stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to constitute at least a majority thereof; or

(d) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company's assets.