1
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.
2
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 [ ]%;
(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");
-2-
3
(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 ▇▇▇▇▇'▇ ▇▇▇▇▇, Wales
facility (the "▇▇▇▇▇ 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:
-3-
4
(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 [ ]% 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
-4-
5
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
-5-
6
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 [ ] forecasted to be purchased by CMC in
the upcoming [ ] from the [ ].
B = pounds of [ ] forecasted to be purchased by CMC in
the upcoming [ ] from the [ ].
C = Total "Delivered Cost" of all [ ] consumed in the
manufacture of [ ] at the [ ] during the
[ ] divided by the total number of
pounds of [ ] produced at the [ ] (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 [ ] consumed in the
manufacture of [ ] at the [ ] during the
[ ] divided by the total number of
pounds of [ ] produced at the [ ] (other than
[ ] which was toll manufactured), including off-quality
material.
The "Starting Feedstock Cost" shall equal the total "Delivered Cost" of
all [ ] consumed at the [ ] and [ ] during [ ] divided by the
total number of pounds of [ ] produced at the [ ] and [ ] (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
-6-
7
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 [ ] 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.
-7-
8
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.
-8-
9
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.
SECTION 6. 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 6. 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
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Fumed Metal Oxide Product Line Manager
Telecopier:
With a copy to:
Cabot Corporation
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Law Department
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
If to CMC: Cabot Microelectronics Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Vice President of Operations
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address as may be designated in writing by any of the parties
from time to time in accordance herewith.
-9-
10
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
-10-
11
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
-11-
12
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.
-12-
13
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/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
CABOT MICROELECTRONICS CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President and
Chief Executive Officer
-13-
14
Schedule A
Fumed Silica Specifications
Product Specification
------- -------------
[ ] [ ]
[ ] [ ]
[ ] [ ]
-14-
15
Schedule B
Fumed Alumina Specifications
Product Specification
------- -------------
[ ] [ ]
-15-