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Exhibit 10.1
MASTER SEPARATION AGREEMENT
DATED AS OF MARCH 28, 2000
BY AND AMONG
CABOT CORPORATION
AND CERTAIN SUBSIDIARIES OF CABOT CORPORATION
AND
CABOT MICROELECTRONICS CORPORATION
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TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS
SECTION 1.01. DEFINED TERMS.................................................. 2
ARTICLE 2
TRANSFER AND CONTRIBUTION OF MMD ASSETS;
ASSUMPTION OF CERTAIN LIABILITIES
SECTION 2.01. TRANSFER OF ASSETS............................................. 8
SECTION 2.02. ASSUMPTION OF LIABILITIES...................................... 11
SECTION 2.03. METHODS OF TRANSFER AND ASSUMPTION............................. 12
SECTION 2.04. NONASSIGNABLE ASSETS AND ASSUMED LIABILITIES................... 13
SECTION 2.05. COSTS OF TRANSFER............................................. 15
ARTICLE 3
ANCILLARY AGREEMENTS
ARTICLE 4
COVENANTS
SECTION 4.01. IPO AND DISTRIBUTION AGREEMENT................................. 16
SECTION 4.02. REGISTRATION RIGHTS AGREEMENT.................................. 16
SECTION 4.03. JOINT AND SEVERAL LIABILITY.................................... 16
ARTICLE 5
INDEMNIFICATION
SECTION 5.01. INDEMNIFICATION BY PARTIES..................................... 17
SECTION 5.02. INDEMNIFICATION PROCEDURES..................................... 17
SECTION 5.03. CERTAIN LIMITATIONS............................................ 19
SECTION 5.04. EXISTING LITIGATION TO BE TRANSFERRED TO CMC; COOPERATION...... 20
ARTICLE 6
ACCESS TO INFORMATION
SECTION 6.01. ACCESS TO INFORMATION.......................................... 20
SECTION 6.02. RECORD RETENTION............................................... 22
SECTION 6.03. PRODUCTION OF WITNESSES........................................ 22
SECTION 6.04. REIMBURSEMENT.................................................. 23
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ARTICLE 7
MISCELLANEOUS
SECTION 7.01. ENTIRE AGREEMENT............................................... 23
SECTION 7.02. GOVERNING LAW.................................................. 23
SECTION 7.03. PERFORMANCE.................................................... 23
SECTION 7.04. NOTICES........................................................ 24
SECTION 7.05. THIRD PARTY BENEFICIARIES...................................... 25
SECTION 7.06. COUNTERPARTS................................................... 25
SECTION 7.07. BINDING EFFECT; ASSIGNMENT..................................... 25
SECTION 7.08. DISPUTE RESOLUTION............................................. 25
SECTION 7.09. SEVERABILITY................................................... 26
SECTION 7.10. WAIVER......................................................... 26
SECTION 7.11. AMENDMENT...................................................... 27
SECTION 7.12. AUTHORITY...................................................... 27
SECTION 7.13. INTERPRETATION................................................. 27
Schedule A Ancillary Agreements
Schedule 2.01(a)(i)(A) Contracts and Agreements
Schedule 2.01(a)(i)(B) Leasehold Interests in Real Property
Schedule 2.01(a)(i)(C) Real Property
Schedule 2.01(a)(i)(D) Management Information Systems and Software
Schedule 2.01(a)(i)(E) Licenses, Permits and Franchises
Schedule 2.01(a)(i)(F) Intellectual Property
Schedule 2.01(e)(ii) Excluded Management Information Systems and Software
Schedule 2.01(e)(iii)(A) Excluded Trademarks and Service Marks
Schedule 2.01(e)(iii)(B) Excluded Patents
Schedule 2.01(e)(iii)(C) Other Excluded Intellectual Property
Schedule 2.01(e)(v) Other Excluded Assets
Schedule 5.04 Legal Claims
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MASTER SEPARATION AGREEMENT
This Master Separation Agreement (this "Agreement") is entered into on
March 28, 2000 among Cabot Corporation, a Delaware corporation ("Cabot"), Cabot
Carbon Ltd., a United Kingdom corporation ("Cabot Carbon"), Cabot Specialty
Chemicals, Inc., a Delaware corporation ("Cabot Specialty"),
and together with Cabot Carbon, the "Relevant Cabot Subsidiaries"), and Cabot
Microelectronics Corporation, a Delaware corporation ("CMC"). Unless expressly
provided otherwise, all references to Cabot shall include all of the Relevant
Cabot Subsidiaries. Capitalized terms used and not otherwise defined herein
shall have the meanings ascribed to such terms in Article 1 hereof.
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 (as defined below) from Cabot;
WHEREAS, Cabot has caused CMC to be incorporated in order to effect
such separation, Cabot currently owns all of the issued and outstanding common
stock of CMC, and CMC currently conducts no business operations and has no
significant assets or liabilities;
WHEREAS, the Boards of Directors of Cabot and CMC have each determined
that it would be appropriate and desirable for Cabot to contribute and transfer
to CMC, and for CMC to receive and assume, directly or indirectly, substantially
all of the assets and liabilities currently associated with the MMD Business,
including certain of the assets and liabilities currently held by the Relevant
Cabot Subsidiaries;
WHEREAS, Cabot and CMC intend that the contribution and assumption of
assets and liabilities will qualify either as a tax-free reorganization under
Section 368 (a) (1) (D) of the Code or will be a tax-free transfer of assets
under Section 351 of the Code;
WHEREAS, Cabot and CMC currently contemplate that, following the
contribution and assumption of assets and liabilities, CMC will make an initial
public offering of an amount of CMC's common stock that will reduce Cabot's
ownership of CMC, but not below 80%;
WHEREAS, Cabot currently contemplates that, following such initial
public offering, Cabot will distribute to the holders of its stock by means of a
pro rata distribution all of the shares of CMC common stock owned by Cabot (the
"Distribution");
WHEREAS, Cabot and CMC intend that the Distribution will be tax-free to
Cabot and its stockholders under the Code; and
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WHEREAS, the parties intend in this Agreement, including the Annexes
and Schedules hereto, to set forth the arrangements between them regarding the
separation of the MMD Business from Cabot.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Defined Terms.
The following terms, as used herein, shall have the following meanings:
"AFFILIATE" of any specified Person means any other Person directly or
indirectly Controlling, Controlled by, or under common Control with, such
specified Person; provided, however, that for purposes of this Agreement, (i)
Cabot and its subsidiaries (other than CMC and its subsidiaries) shall not be
considered Affiliates of CMC and (ii) CMC and its subsidiaries shall not be
considered Affiliates of Cabot.
"ANCILLARY AGREEMENTS" means each of the agreements which are listed on
Schedule A hereto, including any exhibits, schedules, attachments, tables or
other appendices thereto, and each agreement and other instrument contemplated
therein.
"ANSUNG, KOREA ASSETS" means the MMD Assets located in Ansung, Korea.
"ASSETS" means and includes all property and rights of every kind,
nature, character and description, tangible and intangible, real, personal or
mixed, wherever located, including, without limitation, the following:
(A) contracts and agreements (whether or not entered into in the
ordinary course of business), including without limitation
purchase orders issued or received;
(B) real property and the leasehold interests in real property;
(C) licenses, permits or franchises;
(D) Intellectual Property;
(E) Receivables;
(F) Equipment and all existing warranties and guarantees, if any,
express
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or implied, with respect to the Equipment for the benefit of
the owner thereof;
(G) Inventory;
(H) books and records, customer lists, vendor lists, catalogs,
research material, technical information, technology,
specifications, designs, drawings, processes, and quality
control data;
(I) sales promotion and selling literature and promotional and
advertising materials;
(J) security (including cash) deposited with third parties and
security bonds;
(K) goodwill and going concern value;
(L) prepaid expenses;
(M) claims against other parties; and
(N) tax returns.
"ASSUMED LIABILITIES" has the meaning set forth in Section 2.02(a) of
this Agreement.
"BARRY, WALES ASSETS" means the MMD Assets located in Barry, Wales.
"BUSINESS DAY" means a day other than a Saturday, a Sunday or a day on
which banking institutions located in the States of Illinois and Massachusetts
are authorized or obligated by law or executive order to close.
"CABOT INDEMNITEES" has the meaning set forth in Section 5.01(a) of
this Agreement.
"CMC CAPITAL CONTRIBUTION" has the meaning set forth in Section 2.01(b)
of this Agreement.
"CMC COMMON STOCK" means the Common stock, $.001 par value per share,
of CMC.
"CMC FINANCIAL STATEMENTS" means the financial statements (including
the notes thereto) of CMC for the period ended September 30, 1999 as set forth
in the IPO Registration Statement.
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"CMC INDEMNITEES" has the meaning set forth in Section 5.01(b) of this
Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, together with the rules and regulations promulgated thereunder.
"COMMISSION" means the Securities and Exchange Commission.
"CONTRIBUTION DATE" means March 28, 2000.
"CONTROL" means the possession, direct or indirect, of the power to
direct or cause the direction of the management of the policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
"CONTROLLING" and "CONTROLLED" have the corollary meanings ascribed thereto.
"DEMAND" has the meaning set forth in Section 7.08 of this Agreement.
"DISPUTES" has the meaning set forth in Section 7.08 of this Agreement.
"DISTRIBUTION" has the meaning set forth in the recitals to this
Agreement.
"DISTRIBUTION DATE" means the date to be determined by Cabot in its
sole and absolute discretion when the Distribution is completed.
"EQUIPMENT" means equipment, furniture, furnishings, fixtures,
machinery, vehicles, telephones and other tangible personal property.
"EXCLUDED ASSETS" has the meaning set forth in Section 2.01(e) of this
Agreement.
"EXCLUDED LIABILITIES" has the meaning set forth in Section 2.02(b) of
this Agreement.
"FOREIGN ASSETS" means the Ansung, Korea Assets, the Barry, Wales
Assets and the Geino, Japan Assets.
"FUMED METAL OXIDE SUPPLY AGREEMENT" means the Fumed Metal Oxide Supply
Agreement, dated as of January 20, 2000, between Cabot and CMC.
"GEINO, JAPAN ASSETS" means the MMD Assets located in Geino, Japan.
"INCOME TAX" has the meaning set forth in the Tax Sharing Agreement.
"INFORMATION" means all records, books, contracts, instruments,
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computer data and other data.
"INDEBTEDNESS" has the meaning set forth in Section 2.02(b) of this
Agreement.
"INDEMNIFYING PARTY" has the meaning set forth in Section 5.02(a) of
this Agreement.
"INDEMNITEE" has the meaning set forth in Section 5.02(a) of this
Agreement.
"INTELLECTUAL PROPERTY" means the following types of property and all
rights to sue for past infringement thereof:
(1) United States and foreign registered and unregistered
trademarks and service marks, trademark and service mark
registrations, trademark and service mark applications for
registrations, trade names, trade dress and the like together
with the goodwill associated with such marks, names,
registrations and applications for registration;
(2) United States and foreign patents, patent applications, and
all other patent rights (including any divisions,
continuations, continuations-in-part, reexaminations,
extensions, renewals or reissues thereof);
(3) registered and unregistered copyrights, applications for
copyright registration and common law copyrights;
(4) technology, information, know-how and trade secrets, including
without limitation, recorded knowledge, surveys, engineering
reports, manuals, catalogues, research data, proprietary
information, photos, art work, editorial materials, formats,
syndicated market research data, sales data and other similar
information; and
(5) non-governmental licenses, sublicenses, covenants or
agreements which relate in whole or in part to any items of
the categories mentioned above in any of the foregoing clauses
(1), (2), (3) and (4).
"INTENDED TRANSFEREE" has the meaning set forth in Section 2.04 of this
Agreement.
"INTENDED TRANSFEROR" has the meaning set forth in Section 2.04 of this
Agreement.
"INVENTORY" means inventories of raw materials, work in progress and
finished goods and other supplies on hand, in transit or on order, including,
without
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limitation, packaging material, stationery, forms, labels, directories and
promotional materials
"IPO AND DISTRIBUTION AGREEMENT" means the Initial Public Offering and
Distribution Agreement to be entered into between Cabot and CMC on or before the
IPO Effective Date.
"IPO EFFECTIVE DATE" means the date on which the IPO Registration
Statement is declared effective by the Commission.
"IPO REGISTRATION STATEMENT" means the registration statement on Form
S-1, Registration No. 333-95093 filed by CMC with the Commission in connection
with the initial public offering of CMC Common Stock, as it may be amended.
"LOCAL COUNSEL" has the meaning set forth in Section 5.02(b) of this
Agreement.
"MMD ASSETS" has the meaning set forth in Section 2.01(a) of this
Agreement.
"MMD BUSINESS" means the business conducted by the Microelectronics
Materials Division of Cabot at any time on or before the Contribution Date,
either directly or indirectly, through the Relevant Cabot Subsidiaries,
including, but not limited to, (i) all business operations whose financial
performance is reflected in the CMC Financial Statements and (ii) all business
operations initiated or acquired by the Microelectronics Materials Division of
Cabot after the date of the CMC Financial Statements.
"OTHER TAXES" has the meaning set forth in the Tax Sharing Agreement.
"PERSON" means an individual, partnership, limited liability company,
joint venture, corporation, trust, unincorporated association, any other entity,
or any government or any department or agency or other unit thereof.
"POSSESSOR" has the meaning set forth in Section 6.01 of this
Agreement.
"PRIMARY COUNSEL" has the meaning set forth in Section 5.02(b) of this
Agreement.
"PRIOR RELATIONSHIP" means the ownership relationship between Cabot and
CMC at any time prior to the Contribution Date.
"RECEIVABLES" means all accounts and notes receivable and other
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receivables (whether or not billed).
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of March 28, 2000, between Cabot and CMC.
"RELATED PARTIES" has the meaning set forth in Section 6.01 of this
Agreement.
"REPRESENTATIVES" means directors, officers, employees, agents,
consultants, advisors, accountants, attorneys and representatives.
"REQUESTOR" has the meaning set forth in Section 6.01 of this
Agreement.
"REQUIRED TRANSFER CONSENT" has the meaning set forth in Section 2.04
of this Agreement.
"RETENTION PERIOD" has the meaning set forth in Section 6.02(a) of this
Agreement.
"SEPARATE COUNSEL" has the meaning set forth in Section 5.02(b) of this
Agreement.
"SPECIAL PATENT COUNSEL" has the meaning set forth in Section 5.02(b)
of this Agreement.
"SUBSIDIARY" means with respect to any specified Person, any
corporation, any limited liability company, any partnership or other legal
entity of which such Person or any of its Subsidiaries Controls or owns,
directly or indirectly, a majority of the equity interest.
"TAX" or "TAXES" have the meaning set forth in the Tax Sharing
Agreement.
"TAX SHARING AGREEMENT" means the Tax Sharing Agreement, between Cabot
and CMC, dated March 28, 2000.
"THIRD-PARTY CLAIM" means any claim, suit, arbitration, inquiry,
proceeding or investigation by or before any court, governmental or other
regulatory or administrative agency or commission or any arbitration tribunal
asserted by a Person other than any party hereto or their respective Affiliates
which gives rise to a right of indemnification hereunder.
"TRANSFER OBSTACLE" has the meaning set forth on Section 2.04 of this
Agreement.
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ARTICLE 2
TRANSFER AND CONTRIBUTION OF MMD ASSETS;
ASSUMPTION OF CERTAIN LIABILITIES
SECTION 2.01. Transfer of Assets.
(a) Transfer of MMD Assets. On the Contribution Date, Cabot
shall convey, assign, transfer and deliver to CMC all (or in the case of Section
2.01(a)(iii) below, the interest therein specified in such Section 2.01(a)(iii))
of its right, title and interest in and to the MMD Assets, other than the
Foreign Assets.
For the purposes of this Agreement, the term "MMD Assets" shall mean:
(i) except for the Excluded Assets, all Assets that are (x) owned by
Cabot or with respect to which Cabot has the right to transfer after making the
commercially reasonable efforts referred to in Section 2.04(a), and (y) used
exclusively in, relate exclusively to or arise directly from the MMD Business;
for avoidance of doubt, but not by way of limitation of the foregoing, the
following specifically enumerated assets are included within MMD Assets:
(A) contracts and agreements set forth on Schedule
2.01(a)(i)(A);
(B) leasehold interests in real property listed on Schedule
2.01(a)(i)(B), including all buildings, structures and other improvements
situated thereon;
(C) real property listed on Schedule 2.01(a)(i)(C), including
all buildings, structures and other improvements situated thereon;
(D) management information systems and software listed on
Schedule 2.01(a)(i)(D);
(E) licenses, permits or franchises listed on Schedule
2.01(a)(i)(E);
(F) Intellectual Property listed on Schedule 2.01(a)(i)(F) and
all right, title and interest in and to all monetary and other awards and
judgments arising out of Cabot Corporation v. Solution Technology, Inc., Civil
Action No.: 3.96CV505-McK (WD NC) (the "STI Litigation");
(G) the tax returns of Cabot relating to Other Taxes relating
to or arising out of the MMD Business as conducted through the Contribution
Date; and
(H) the intercompany accounts owing from Cabot and its
Affiliates to the MMD Business.
(ii) the Assets, other than Intellectual Property and Excluded
Assets set forth in 2.01(e)(ii) through (viii) below, located in Aurora,
Illinois,
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Hammond, Indiana and Barry, Wales that are used by the MMD Business in the
manufacture and production of fumed metal oxide dispersions.
(b) Purchase of Barry, Wales Assets, Geino, Japan Assets and
Ansung, Korea Assets. In addition to the transfer of MMD Assets pursuant to the
foregoing paragraph (a) of this Agreement, Cabot and the Relevant Cabot
Subsidiaries hereby also agree to sell to CMC on the Contribution Date the
Foreign Assets in exchange for a total aggregate consideration equal to the fair
market value of such Foreign Assets, determined using the net book value of such
assets, which shall constitute the total purchase price for the assets.
(c) CMC ACKNOWLEDGES AND AGREES THAT THE FOREGOING TRANSFERS
AND SALES ARE BEING MADE "AS IS WHERE IS" AND THAT NEITHER CABOT NOR ANY
SUBSIDIARY OF CABOT HAS MADE OR WILL MAKE ANY WARRANTY, EXPRESSED OR IMPLIED,
INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, WITH RESPECT TO ANY ASSET OR ANY FOREIGN ASSET.
(d) Cabot and CMC shall have the rights in and to the
Dispersions Technology as defined in the Confidential Disclosure and License
Agreement, dated as of March 28, 2000, between them (the "CD&L Agreement").
(e) Excluded Assets. Notwithstanding anything to the contrary
in paragraph (a) above, it is expressly understood and agreed that the Assets
shall not include the following assets (the "Excluded Assets"):
(i) assets (including, without limitation, Assets of
the type listed in the definition of Assets) used (partially or entirely) or
owned in connection with any businesses and operations of Cabot and its
Affiliates other than the MMD Business unless specifically enumerated in Section
2.01(a) and the related schedules;
(ii) management information systems and software listed
on Schedule 2.01(e)(ii);
(iii) Cabot's right, title and interest in and to the
following Intellectual Property:
(A) all United States and foreign registered
and unregistered trademarks and service marks, trademark and
service mark registrations, trademark and service mark
applications for registrations, trade names, trade dress and
the like listed on Schedule 2.01(e)(iii)(A), together with the
goodwill associated with such marks, names, registrations and
applications for registration;
(B) all United States and foreign patents,
patent
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applications, and all other patent rights (including any
divisions, continuations, continuations-in-part,
reexaminations, extensions, renewals or reissues thereof)
listed on Schedule 2.01(e)(iii)(B);
(C) all technology, information, know-how
and trade secrets, including without limitation, recorded
knowledge, surveys, engineering reports, manuals, catalogues,
research data, proprietary information, photos, art work,
editorial materials, formats, syndicated market research data,
sales data and other similar information listed on Schedule
2.01(e)(iii)(C), and
(D) all non-governmental licenses,
sublicenses, covenants or agreements to which Cabot is a
party, which relate in whole or in part to any items of the
categories mentioned above in clauses (A), (B) and (C),
including all trademark licenses;
(iv) all of the Assets located at Cabot's facility in
Tuscola, Illinois;
(v) any assets listed on Schedule 2.01(e)(v);
(vi) the tax returns, corporate minute books and stock
ledgers of Cabot, except those specifically included in the definition of MMD
Assets;
(vii) all cash and cash equivalents or similar type
investments, such as certificates of deposit, Treasury bills and other
marketable securities, of Cabot (even if otherwise used in the MMD Business);
and
(viii) the real property, structures, other
improvements and fixtures located in Barry, Wales.
(f) Instruments of Conveyance and Transfer. On or about the
Contribution Date, Cabot shall (i) deliver or cause to be delivered to CMC such
deeds, bills of sale, endorsements, consents, assignment, and other good and
sufficient instruments of conveyance and assignment, all in recordable form,
where applicable, as are required under local custom and practice to vest in CMC
all right, title and interest of Cabot in and to the MMD Assets, and as will
otherwise be in form and substance reasonably satisfactory to CMC and CMC's
counsel; and (ii) transfer to CMC all contracts, agreements, commitments, books,
records, files, certificates, licenses, permits, plans and specifications and
other data included in the MMD Assets, including, without limitation, computer
tapes and computer-generated records. Notwithstanding the foregoing clause (i),
with respect to the Intellectual Property, Cabot shall deliver to CMC on the
Contribution Date documents for the transfer and assignment of the Intellectual
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Property included in the MMD Assets and shall thereafter deliver to CMC good and
sufficient instruments of conveyance and assignment, all in recordable form, for
all registered trademarks, patents, registered copyrights and pending
applications with respect to any of the foregoing.
(g) Further Assurances. From time to time after the
Contribution Date, Cabot and any Affiliate of Cabot shall execute, acknowledge
and deliver, or cause to be executed, acknowledged and delivered, such other
instruments of conveyance, assignment, transfer and delivery and will take or
cause to be taken such other actions as CMC may reasonably request in order more
effectively to sell, convey, assign, transfer, and deliver to CMC any of the MMD
Assets, or to enable CMC to protect, exercise and enjoy all rights and benefits
of Cabot with respect thereto, and as otherwise may be appropriate to carry out
the transactions herein contemplated.
SECTION 2.02. Assumption of Liabilities.
(a) Assumed Liabilities. On the Contribution Date, CMC shall
assume and agree to pay, perform and discharge when due, all liabilities and
obligations of Cabot (other than the Excluded Liabilities) relating to or
arising out of the MMD Business, whether direct or indirect, absolute or
contingent, contractual, tortious or otherwise, known or unknown, including,
without limitation, all liabilities relating to or arising out of the MMD
Business as conducted through the Contribution Date that are unknown to Cabot
and/or unrealized as of the Contribution Date and that become known to Cabot or
are realized or otherwise arise after the Contribution Date. Without limiting
the generality of the foregoing, the Assumed Liabilities shall include all
duties, obligations and liabilities (actual, contingent and other) of Cabot to
the Rippey Corporation and Rodel Inc. The liabilities and obligations assumed by
CMC in accordance with this Section 2.02 (other than the Excluded Liabilities
described below) are sometimes hereinafter referred to as the "Assumed
Liabilities." Assumed Liabilities include intercompany accounts owing from the
MMD Business to Cabot and its Affiliates.
(b) Excluded Liabilities. Notwithstanding the foregoing, CMC
shall not assume any of the following liabilities (the "Excluded Liabilities"):
(i) any liability or obligation in respect of any
Indebtedness of Cabot and all Affiliates of Cabot (for the purposes hereof,
"Indebtedness" shall mean (i) all indebtedness for borrowed money, other than
capitalized leases and similar purchase money obligations, (ii) any other
Indebtedness evidenced by a note, bond, debenture or similar instrument, (iii)
all obligations in respect of banker's acceptances and (iv) any guarantee or
other contingent obligation in respect of any of the foregoing);
(ii) any liability for or obligation in respect of
Income Tax or any
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liability for the payment of any "excess parachute payment," as defined in
Section 280G of the Code;
(iii) except as specifically provided in the
Ancillary Agreements or related to accrued reimbursement, welfare, vacation and
similar benefit obligations incurred in the ordinary course of business and
reflected in the CMC Financial Statements, any liabilities or obligations
relating to or arising under any employee or retirement benefit plan, program,
arrangement or agreement maintained or contributed by Cabot or its Affiliates;
(iv) any liabilities or obligations of Cabot that are
not incidental to or do not arise out of or were not incurred with respect to
the MMD Business; and
(v) any liability or obligation arising from or
related to Cabot's fumed metal oxide business.
SECTION 2.03. Methods of Transfer and Assumption.
(a) The parties shall enter into the Ancillary Agreements,
other than the IPO and Distribution Agreement and the Registration Rights
Agreement, on or about the date of this Agreement. To the extent that the
transfer of any Asset or the assumption of any Liability is expressly provided
for by the terms of any Ancillary Agreement, the terms of such Ancillary
Agreement shall determine the manner of the transfer or assumption. It is the
intent of the parties that pursuant to Section 2.01, the transfer and assumption
of all other MMD Assets and Assumed Liabilities shall be made effective as of
the Contribution Date, provided, however, that circumstances may require the
transfer of certain MMD Assets and the assumption of certain Liabilities to
occur in such other manner and at such other time as the parties shall agree.
(b) The parties intend to complete the assignment and transfer
of all MMD Assets and the transfer and assumption of all Assumed Liabilities
effective on or prior to the Contribution Date. If any MMD Asset cannot be
assigned or transferred by Cabot or a Relevant Cabot Subsidiary, or any Assumed
Liability cannot be transferred by Cabot or a Relevant Cabot Subsidiary or
assumed by MMD on or prior to the Contribution Date for a reason set forth in
Section 2.04(d), Section 2.4(d) shall govern the parties rights and obligations
with respect to such MMD Asset or such Assumed Liability. In addition to those
transfers and assumptions accurately identified and designated by the parties to
take place but which the parties are not able to effect prior to the
Contribution Date, there may exist (i) assets (including Assets) that the
parties discover were, contrary to the agreements between the parties, by
mistake or omission, transferred to CMC or retained by Cabot or (ii) liabilities
(including Liabilities) that the parties discover were, contrary to the
agreements between the parties, by mistake or omission, assumed by CMC
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or not assumed by CMC. The parties shall cooperate in good faith to effect the
transfer or re-transfer of such assets, and/or the assumption or re-assumption
of such liabilities, in any case as soon as reasonably practicable, to or by the
appropriate party and shall not use the determination of remedial actions
contemplated herein to alter the original intent of the parties hereto with
respect to the MMD Assets to be transferred to or Assumed Liabilities to be
assumed by CMC. Each party shall reimburse the other or make other financial
adjustments (e.g., without limitation, cash reserves) or other adjustments to
remedy any mistakes or omissions relating to any of the Assets transferred
hereby or any of the Assumed Liabilities assumed hereby.
(c) Each party hereto shall execute and deliver to
each other party all such documents, instruments, certificates and agreements in
appropriate form, and shall make all filings and recordings and take all such
other actions, as shall be necessary or reasonably requested by such other
party, whether before or after the Contribution Date, in order to give full
effect to and to evidence and perfect the transfer and contribution of the MMD
Assets and the assumption of the Assumed Liabilities as contemplated hereby.
However, CMC acknowledges and agrees that neither Cabot nor any Subsidiary of
Cabot will comply with the provisions of any bulk transfer law or similar laws
of any jurisdiction giving creditors of a transferor rights against the
transferee in connection with the transfer of any Asset.
SECTION 2.04. Nonassignable Assets and Assumed Liabilities.
Anything contained herein to the contrary notwithstanding, this Agreement
shall not constitute an agreement to assign or transfer any Asset or to transfer
and assume any Assumed Liability if an assignment or attempted assignment or
transfer or attempted transfer and assumption of the same without the consent of
another Person would constitute a breach of any contract or agreement or in any
way impair the rights of a party thereunder or give to any third party any
rights with respect thereto. If any such consent (a "Required Transfer Consent")
is not obtained and/or if for any other reason (a "Transfer Obstacle") an
attempted assignment or attempted transfer and assumption would otherwise be
ineffective or would impair the rights of the party attempting to make such
assignment or transfer (the "Intended Transferee") under any such contract or
agreement so that the party entitled to the benefits and responsibilities of
such attempted assignment or attempted transfer and assumption (the "Intended
Transferee") would not receive all such rights and responsibilities, then:
(a) the Intended Transferor shall use commercially reasonable efforts
(without any obligation to expend any funds or incur any losses or liabilities)
to obtain the Required Transfer Consent and/or eliminate the Transfer Obstacle.
(b) until the Required Transfer Consent is obtained and/or the Transfer
Obstacle is eliminated in accordance with subsection (a) above and the
assignment and transfer of the applicable Asset or the transfer and assumption
of the Assumed Liability
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has been effected in accordance with subsection (c) below and the other
provisions of this Agreement:
(i) the Intended Transferor shall use commercially reasonable efforts
to provide or cause to be provided to the Intended Transferee, to the extent
permitted by law, the benefits or liabilities of any such Asset or Assumed
Liability and the Intended Transferor shall promptly pay or cause to be paid to
the Intended Transferee when received all moneys received by the Intended
Transferor with respect to any such Asset,
(ii) in consideration thereof the Intended Transferee shall pay,
perform and discharge on behalf of the Intended Transferor all of the Intended
Transferor's liabilities thereunder in a timely manner and in accordance with
the terms thereof which it may do without breach, and
(iii) the Intended Transferor shall take such other actions as may
reasonably be requested by the Intended Transferee in order to place the
Intended Transferee, insofar as reasonably possible, in the same position as if
such Asset or Assumed Liability had been assigned or transferred as contemplated
hereby and so all the benefits and burdens relating thereto, including
possession, use, risk of loss, potential for gain and dominion, control and
command, shall inure to the Intended Transferee.
(c) If and when any Required Transfer Consent is obtained or any
Transfer Obstacle is eliminated, the assignment of the applicable Asset or the
transfer and assumption of the Assumed Liability shall be effected as soon as
practicable in accordance with the terms of this Agreement.
SECTION 2.05. Costs of Transfer.
CMC shall bear the total costs of the transfer of the MMD Assets from
Cabot and the Relevant Cabot Subsidiaries to CMC and the assumption by CMC of
all Assumed Liabilities, including, without limitation, any and all (i) moving
expenses, (ii) transfer taxes, (iii) expenses incurred in connection with any
notices to customers, suppliers or other third parties regarding such transfer
of MMD Assets or such assumption of Assumed Liabilities, (iv) fees incurred in
connection with the transfer of any licenses, permits or franchises from Cabot
or any Relevant Cabot Subsidiary to CMC or the obtaining of any new (or the
re-issuance of any existing) licenses, permits or franchises in the name or CMC,
(v) fees and expenses incurred in connection with the assignment or transfer of
any contracts, agreements or Intellectual Property from Cabot or any Relevant
Cabot Subsidiary to CMC, (vi) any recording or other fees, taxes, charges or
assessments incurred in connection with the transfer of any real property from
Cabot or any Relevant Cabot Subsidiary to CMC, (vii) the transfer from Cabot or
any Relevant Cabot Subsidiary to CMC, or the establishment by CMC of any
domestic or foreign branch office and (viii) the transfer of any employee of
Cabot or any Relevant Cabot Subsidiary to CMC. CMC hereby agrees to reimburse
Cabot or any Relevant Cabot
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Subsidiary, as applicable, promptly upon request, for any cost, including,
without limitation, any of the foregoing costs (including any applicable taxes,
fees and penalties assessed in connection with any of the foregoing), incurred
by Cabot in connection with the transfer of MMD Assets from Cabot or any
Relevant Cabot Subsidiary to CMC or the assumption by CMC of any Assumed
Liability.
ARTICLE 3
ANCILLARY AGREEMENTS
(a) General. Cabot and CMC acknowledge and agree that the Ancillary
Agreements have been or will be entered into prior to, and each of the Ancillary
Agreements will provide that the rights, interests, duties, liabilities and
obligations of the parties to such agreements will be effective on and as of,
the IPO Effective Date. Cabot and CMC shall take all steps reasonably necessary
to cause their respective Subsidiaries and Affiliates to enter into and perform
such Ancillary Agreements in accordance with their terms.
(b) Priority. To the extent that any Ancillary Agreement conflicts with
the terms of this Agreement, including, without limitation, matters covered by
Article 2 and Article 5 hereof, the terms and conditions of such Ancillary
Agreement shall govern the rights and obligations of the parties with respect to
such matters.
ARTICLE 4
COVENANTS
SECTION 4.01. IPO and Distribution Agreement.
Cabot and CMC hereby agree to execute and deliver, on or before the IPO
Effective Date, the IPO and Distribution Agreement, in substantially the form
agreed upon between the parties on or prior to the date hereof, with such
modifications to such form as the parties shall mutually deem reasonably
necessary and desirable; provided, that Cabot shall be entitled in its sole and
absolute discretion at any time and from time to time to make any modifications
to the provisions thereof relating to the preservation of the tax-free nature of
the Distribution or the tax-free nature of the transactions contemplated hereby
as it shall reasonably deem necessary or desirable.
SECTION 4.02. Registration Rights Agreement.
Cabot and CMC hereby agree to execute and deliver, on or before the IPO
Effective Date, the Registration Rights Agreement, in substantially the form
agreed upon between the parties on or prior to the date hereof, with such
modifications to such form as the parties shall mutually deem reasonably
necessary and desirable; provided, that Cabot
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shall be entitled in its sole and absolute discretion at any time and from time
to time to make any modifications to the provisions thereof relating to the
preservation of the tax-free nature of the Distribution or the tax-free nature
of the transactions contemplated hereby as it shall reasonably deem necessary or
desirable.
SECTION 4.03. Joint and Several Liability.
Cabot shall be liable for the duties, liabilities and obligations of
each Relevant Cabot Subsidiary under and pursuant to this Agreement.
ARTICLE 5
INDEMNIFICATION
SECTION 5.01. Indemnification by Parties.
(a) CMC shall indemnify, defend and hold harmless Cabot and each of its
Subsidiaries and their respective successors-in-interest, and each of their
respective past and present Representatives (the "Cabot Indemnitees") against
any losses, claims, damages, liabilities or actions, resulting from, relating to
or arising, whether prior to or following the Contribution Date, out of or in
connection with (a) the Assumed Liabilities and/or (b) CMC's conduct of its
business and affairs after the Contribution Date, and CMC shall reimburse each
Cabot Indemnitee for any reasonable attorneys' fees or any other expenses
reasonably incurred by any of them in connection with investigating and/or
defending any such loss, claim, damage, liability or action, other than legal
fees incurred prior to the Contribution Date.
(b) Cabot (the "Cabot Indemnifying Party") shall indemnify, defend and
hold harmless CMC and each of its Subsidiaries and their respective
successors-in-interest, and each of their past and present Representatives (the
"CMC Indemnitees") against any losses, claims, damages, liabilities or actions,
resulting from, relating to or arising, whether prior to or following the
Contribution Date, out of or in connection with (a) the Excluded Assets and/or
(b) the Excluded Liabilities, and Cabot shall reimburse each CMC indemnitee for
any reasonable attorneys' fees or any other expenses reasonably incurred by any
of them in connection with investigating and/or defending any such loss, claim,
damage, liability or action, other than legal fees incurred prior to the
Contribution Date.
SECTION 5.02. Indemnification Procedures.
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(a) If a Cabot Indemnitee or CMC Indemnitee (collectively, an
"Indemnitee") receives notice of the assertion of any Third-Party Claim with
respect to which a CMC Indemnifying Party or Cabot Indemnifying Party
(collectively, an "Indemnifying Party") is, or is likely to be, obligated under
this Agreement to provide indemnification, such Indemnitee shall promptly give
such Indemnifying Party notice thereof (together with a copy of such Third-Party
Claim, process or other legal pleading) promptly after becoming aware of such
Third-Party Claim; provided, however, that the failure of any Indemnitee to give
notice as provided in this Section 5.02 shall not relieve any Indemnifying Party
of its obligations under this Section 5.02, except to the extent that such
Indemnifying Party is actually prejudiced by such failure to give notice. Such
notice shall describe such Third-Party Claim in reasonable detail.
(b) An Indemnifying Party, at such Indemnifying Party's own expense and
through counsel chosen by such Indemnifying Party (which counsel shall be
reasonably acceptable to the Indemnitee), may elect to defend any Third-Party
Claim. If an Indemnifying Party elects to defend a Third-Party Claim in
accordance with the foregoing, then, within ten Business Days after receiving
notice of such Third-Party Claim (or sooner, if the nature of such Third Party
claim so requires), such Indemnifying Party shall notify the Indemnitee of its
intent to do so, and such Indemnitee shall cooperate in the defense of such
Third-Party Claim. Such Indemnifying Party shall pay such Indemnitee's
reasonable out-of-pocket expenses incurred in connection with such cooperation.
Such Indemnifying Party shall keep the Indemnitee reasonably informed as to the
status of the defense of such Third-Party Claim. After notice from an
Indemnifying Party to an Indemnitee of its election to assume the defense of a
Third-Party Claim, such Indemnifying Party shall not be liable to such
Indemnitee under this Section 5.02 for any attorneys' fees or other expenses
subsequently incurred by such Indemnitee in connection with the defense thereof
other than those expenses referred to in the preceding sentence; provided,
however, that such Indemnitee shall have the right to employ one law firm as
counsel ("Primary Counsel"), together with a local law firm in each applicable
jurisdiction (collectively, "Local Counsel") and, in the case of patent
litigation, special patent counsel ("Special Patent Counsel", and together with
Primary Counsel and Local Counsel, "Separate Counsel"), to represent such
Indemnitee in any action or group of related actions (which firm or firms shall
be reasonably acceptable to the Indemnifying Party) if, in such Indemnitee's
reasonable judgment at any time, either a conflict of interest between such
Indemnitee and such Indemnifying Party exists in respect of such claim, or there
may be defenses available to such Indemnitee which are significantly different
from or in addition to those available to such Indemnifying Party and the
representation of both parties by the same counsel would, in the reasonable
judgment of the Indemnitee, be inappropriate, and in that event (i) the
reasonable fees and expenses of such Separate Counsel shall be paid by such
Indemnifying Party (it being understood, however, that the Indemnifying Party
shall not be liable for the expenses of more than one Primary Counsel, one Local
Counsel in any one jurisdiction and one Special Patent Counsel with respect to
any Third-Party Claim (even if against multiple Indemnitees))
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and (ii) each of such Indemnifying Party and such Indemnitee shall have the
right to conduct its own defense in respect of such claim. If an Indemnifying
Party (i) elects not to defend against a Third-Party Claim, (ii) fails to notify
an Indemnitee of its election as provided in this Section 5.02 within the period
of ten Business Days described above or (iii) elects to defend a Third Party
Claim but, in the reasonable judgment of the Indemnitee, fails to timely,
properly and adequately defend such claim, the Indemnitee may defend,
compromise, and settle such Third-Party Claim and shall be entitled to
indemnification hereunder (to the extent permitted hereunder); provided,
however, that no such Indemnitee may compromise or settle any such Third-Party
claim without the prior written consent of the Indemnifying Party, which consent
shall not be unreasonably withheld or delayed. Notwithstanding the foregoing,
the Indemnifying Party shall not, without the prior written consent of the
Indemnitee, (i) settle or compromise any Third-Party Claim or consent to the
entry of any judgment which does not include as an unconditional term thereof
the dismissal without prejudice of such Third Party Claim or delivery by the
claimant or plaintiff to the Indemnitee of a written release from all liability
in respect of such Third-Party Claim or (ii) settle or compromise any
Third-Party Claim in any manner that would be reasonably likely to have a
material adverse effect on the Indemnitee.
SECTION 5.03. Certain Limitations.
(a) The amount of any indemnifiable losses or other liability for which
indemnification is provided under this Agreement shall be net of any amounts
actually recovered by the Indemnitee from third parties (including, without
limitation, amounts actually recovered under insurance policies) with respect to
such indemnifiable losses or other liability. Any Indemnifying Party hereunder
shall be subrogated to the rights of the Indemnitee upon payment in full of the
amount of the relevant indemnifiable loss. An insurer who would otherwise be
obligated to pay any claim shall not be relieved of the responsibility with
respect thereto or, solely by virtue of the indemnification provision hereof,
have any subrogation rights with respect thereto. If any Indemnitee recovers an
amount from a third party in respect of an indemnifiable loss for which
indemnification is provided in this Agreement after the full amount of such
indemnifiable loss has been paid by an Indemnifying Party or after an
Indemnifying Party has made a partial payment of such indemnifiable loss and the
amount received from the third party exceeds the remaining unpaid balance of
such indemnifiable loss, then the Indemnitee shall promptly remit to the
Indemnifying Party the excess (if any) of (A) the sum of the amount theretofore
paid by such Indemnifying Party in respect of such indemnifiable loss plus the
amount received from the third party in respect thereof, less (B) the full
amount of such indemnifiable loss or other liability. Nothing in this Section
5.03(b) shall obligate any Indemnifying Party to seek to recover any amounts
from any third party (including, without limitation, amounts recoverable under
insurance policies) prior to, or as a
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condition to, seeking indemnification under this Article Five.
(b) The amount of any loss or other liability for which indemnification
is provided under this Agreement shall be (i) increased to take account of any
net tax cost incurred by the Indemnitee arising from the receipt or accrual of
an indemnification payment hereunder (grossed up for such increase) and (ii)
reduced to take account of any net tax benefit realized by the Indemnitee
arising from incurring or paying such loss or other liability. In computing the
amount of any such tax cost or tax benefit, the Indemnitee shall be deemed to
recognize all other items of income, gain, loss, deduction or credit before
recognizing any item arising from the receipt or accrual of any indemnification
payment hereunder or incurring or paying any indemnified loss. Any
indemnification payment hereunder shall initially be made without regard to this
Section 5.03(b) and shall be increased or reduced to reflect any such net tax
cost (including gross-up) or net tax benefit only after the Indemnitee has
actually realized such cost or benefit. For purposes of this Agreement, an
Indemnitee shall be deemed to have "actually realized" a net tax cost or a net
tax benefit to the extent that, and at such time as, the amount of taxes payable
by such Indemnitee is increased above or reduced below, as the case may be, the
amount of taxes that such Indemnitee would be required to pay but for the
receipt or accrual of the indemnification payment or the incurrence or payment
of such loss, as the case may be. The amount of any increase or reduction
hereunder shall be adjusted to reflect any final determination with respect to
the Indemnitee's liability for taxes, and payments between such indemnified
parties to reflect such adjustment shall be made if necessary.
(c) Any indemnification payment made under this Agreement relating to
Assumed Liabilities, Excluded Assets and Excluded Liabilities shall be
characterized for tax purposes as if such payment were made immediately prior to
the Contribution Date.
SECTION 5.04. Existing Litigation to be Transferred to CMC;
Cooperation.
On the Contribution Date, all liabilities and legal responsibilities
for the claims identified on Schedule 5.04 shall be transferred in their
entirety from Cabot to CMC. As of the Contribution Date and until CMC shall
notify Cabot that CMC will assume the defense of such claims, Cabot shall
continue to defend such claims and shall be indemnified by CMC as provided in
Section 5.02.
ARTICLE 6
ACCESS TO INFORMATION
SECTION 6.01. Access to Information.
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During the Retention Period (as defined in Section 6.02 below), each of
the parties hereto shall cooperate with and afford, and shall cause their
respective Affiliates, Representatives, Subsidiaries, successors and/or
assignees, and shall use reasonable efforts to cause joint ventures that are not
Affiliates (collectively, "Related Parties") to cooperate with and afford, to
the other party reasonable access upon reasonable advance written request to all
Information (other than Information which is (i) protected from disclosure by
the attorney client privilege or work product doctrine, (ii) proprietary in
nature or (iii) the subject of a confidentiality agreement between such party
and a third party which prohibits disclosure to the other party) within such
party's or any Related Party's possession which was created prior to the
Contribution Date or, with respect to any information which would be relevant to
the provision of a transitional service pursuant to this Agreement or any
Ancillary Agreement, information created during the period in which one party is
providing the other party with such transition service. Access to the requested
information shall be provided so long as it relates to the requesting party's
(the "Requestor") business, assets or liabilities, and access is reasonably
required by the Requestor as a result of the parties' Prior Relationship for
purposes of auditing, accounting, claims or litigation (except for claims or
litigation between the parties hereto), employee benefits, regulatory or tax
purposes or fulfilling disclosure or reporting obligations including, without
limitation, Information reasonably necessary for the preparation of reports
required by or filed under the Securities Exchange Act of 1934, as amended, with
respect to any period entirely or partially prior to the Contribution Date.
Access as used in this paragraph shall mean the obligation of a party
in possession of Information (the "Possessor") requested by the Requestor to
exert its reasonable best efforts to locate all requested Information that is
owned and possessed by Possessor or any Related Party. The Possessor, at its own
expense, shall conduct a diligent search designed to identify all requested
Information and shall collect all such Information for inspection by the
Requestor during normal business hours at the Possessor's place of business.
Subject to confidentiality and/or security provisions as the Possessor may
reasonably deem necessary, the Requestor may have all requested Information
duplicated at Requestor's expense. Alternatively, the Possessor may choose to
deliver, at its own expense, all requested Information to the Requestor in the
form it was requested by the Requestor. If so, the Possessor shall notify the
Requestor in writing at the time of delivery if such Information is to be
returned to the Possessor. In such case, the Requestor shall return such
Information when no longer needed to the Possessor at the Possessor's expense.
In connection with providing Information pursuant to this Section 6.01,
each of the parties hereto shall upon the request of the other party make
available its respective employees (and those of their respective Related
Parties, as applicable) to the extent that they are reasonably necessary to
discuss and explain all requested Information with and to the requesting party.
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SECTION 6.02. Record Retention.
(a) Books and Records. CMC shall preserve and keep all books and
records included in the MMD Assets or otherwise in the possession of CMC or its
Related Parties, whether in electronic form or otherwise, for not less than ten
years from the Contribution Date, or for any longer period as may be required
(i) by any government agency, or (ii) in connection with any litigation, law,
regulation, audit or appeal of taxes, tax examination or the expiration of the
periods described in Section 7 of the Tax Sharing Agreement, where applicable
(the "Retention Period") at CMC's sole cost and expense. If CMC wishes to
dispose of any books and records or other documents which it is obligated to
retain under this Section 6.02 after the Retention Period, then CMC shall first
provide 90 days' written notice to Cabot and Cabot shall have the right, at its
option and expense, upon prior written notice within such 90-day period, to take
possession of such books or records or other documents within 180 days after the
date of CMC's notice to Cabot hereunder. Written notice of intent to dispose of
such books and records shall include a description of the books and records in
detail sufficient to allow Cabot to reasonably assess its potential need to
retain such materials. In the event CMC enters into an agreement with a third
party to sell a portion of its business, together with the books and records
related thereto, Cabot shall have the right to duplicate such books and records
prior to any such disposition and, should the purchaser of the CMC business be a
competitor of Cabot, Cabot shall have the right to prohibit the transfer or
disclosure to such party of that portion of the former books and records of
Cabot which Cabot notifies CMC contain confidential and proprietary information.
To the extent that books and records of Cabot or any of its Affiliates which
contain information relating to the MMD Business are not included in the MMD
Assets, Cabot agrees to cooperate with CMC in providing CMC with any such
information upon CMC's reasonable request to the extent that any such
information exists and is reasonably separable from Cabot information unrelated
to the MMD Business. CMC shall reimburse Cabot for all of its reasonable
out-of-pocket costs incurred in connection with any such request.
(b) Access to Personnel. Cabot shall, from time to time, at the
reasonable request of CMC, cooperate fully with CMC in providing CMC, to the
extent reasonably possible through applicable Cabot employees, with technical
assistance and information in respect to any claims brought against CMC
involving the conduct of the MMD Business prior to the Contribution Date,
including consultation and/or the appearance(s) of such persons on a reasonable
basis as expert or fact witnesses in trials or administrative proceedings.
SECTION 6.03. Production of Witnesses.
Until the six-year anniversary of the Contribution Date, each of the
parties hereto shall use all commercially reasonable efforts, and shall cause
each of their
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respective Affiliates to use all commercially reasonable efforts, to make
available to each other, upon written request, its directors, officers,
employees and other Representatives as witnesses to the extent that any such
Person may reasonably be required (giving consideration to the business demands
upon such Persons) in connection with any legal, administrative or other
proceedings in which the requesting party may from time to time be involved;
provided, however, that with respect to any legal or administrative proceedings
relating to the tax liability of any of the parties hereto or any of their
respective Affiliates, each of the parties hereto shall, and shall cause each of
their respective Affiliates to, make their directors, officers, employees and
other Representatives available as witnesses until such time as the statute of
limitations have expired with respect to all tax years prior to and including
the year in which the asset transfers contemplated by this Agreement are
consummated.
SECTION 6.04. Reimbursement.
Unless otherwise provided in Article 5 or this Article 6, each party to
this Agreement providing access, information or witnesses to another party
pursuant to Sections 6.01, 6.02 or 6.03 shall be entitled to receive from the
recipient, upon the presentation of invoices therefor, payment for all
reasonable out-of-pocket costs and expenses (excluding allocated compensation,
salary and overhead expense) as may be reasonably incurred in providing such
information or witnesses.
ARTICLE 7
MISCELLANEOUS
SECTION 7.01. Entire Agreement.
Except as otherwise set forth in this Agreement, this Agreement, the
Ancillary Agreements and the schedules hereto shall constitute the entire
agreement between the parties hereto with respect to the subject matter hereof
and shall supersede all prior agreements and understandings, whether written or
oral, between the parties with respect to such subject matter.
SECTION 7.02. Governing Law.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware (other than the laws regarding conflicts of
laws) as to all matters, including matters of validity, construction, effect,
performance and remedies.
SECTION 7.03. Performance.
Each of the parties hereto shall use all commercially reasonable
efforts to cause to be performed all actions, agreements and obligations set
forth herein to be
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performed by any Affiliate of such party.
SECTION 7.04. 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) 342-6281
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
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was sent.
SECTION 7.05. Third Party Beneficiaries.
The Indemnitees and their respective successors shall be third party
beneficiaries of the indemnification provisions of Section 5, as applicable, and
shall be entitled to enforce those provisions, in each such case as fully and to
the same extent as if they were parties to this Agreement. Except as provided in
the previous sentence, nothing in this Agreement, express or implied, is
intended to or shall confer upon any Person (other than the Parties and their
successors and assigns) any legal or equitable right, benefit or remedy of any
nature whatsoever under or by reason of this Agreement, and no Person (other
than as provided in the previous sentence) shall be deemed a third party
beneficiary under or by reason of this Agreement.
SECTION 7.06. 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.
SECTION 7.07. 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 with another Person, 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.
SECTION 7.08. Dispute Resolution.
Except as otherwise set forth in the Ancillary Agreements, 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 this
Section 7.08. 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
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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.
SECTION 7.09. Remedies.
Each of Cabot, the Relevant Cabot Subsidiaries and CMC shall be
entitled to enforce its rights under this Agreement specifically, to recover
damages and costs (including reasonable attorneys' fees) caused by any breach of
any provision of this Agreement and to exercise all other rights existing in its
favor. Each of Cabot, the Relevant Cabot Subsidiaries and CMC acknowledges and
agrees that under certain circumstances the breach by Cabot or any of its
Subsidiaries (including without limitation the Relevant Cabot Subsidiaries, but
excluding CMC and its Subsidiaries), on the one hand, and CMC or any of its
Subsidiaries, on the other hand, of a term or provision of this Agreement will
materially and irreparably harm the other party, that money damages will
accordingly not be an adequate remedy for such breach and that the
non-defaulting party, in its sole discretion and in addition to its rights under
this Agreement and any other remedies it may have at law or in equity, may apply
to any court of law or equity of competent jurisdiction (without posting any
bond or deposit) for specific performance and/or other injunctive relief in
order to enforce or prevent any breach of the provisions of this Agreement.
SECTION 7.10. 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.
SECTION 7.11. 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
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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.
SECTION 7.12. Amendment.
This Agreement or the Ancillary Agreements may not be amended or
modified in any respect except by a written agreement signed by both of the
parties hereto.
SECTION 7.13. 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.
SECTION 7.14. 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. After the Contribution Date, the MMD Business shall be
deemed to no longer exist and all references made herein to CMC as a party which
operate as of a time following the Contribution Date, shall be deemed to refer
to CMC and its subsidiaries as a single party.
* * * * * * * *
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed
on its behalf by its officers thereunto duly authorized on the day and year
first above written.
CABOT CORPORATION
By: /s/ Samuel W. Bodman
---------------------------------
Name: Samuel W. Bodman
Title: Chairman and CEO
CABOT CARBON LTD.
By: /s/ David Jayne
---------------------------------
Name: David Jayne
Title: Director
CABOT SPECIALTY CHEMICALS, INC.
By: /s/ Samuel W. Bodman
---------------------------------
Name: Samuel W. Bodman
Title: Vice President
CABOT MICROELECTRONICS CORPORATION
By: /s/ Matthew Neville
---------------------------------
Name: Matthew Neville
Title: President and CEO
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Schedule A
Ancillary Agreements
IPO and Distribution Agreement
Tax Sharing Agreement
Registration Rights Agreement
Fumed Metal Oxide Supply Agreement
Management Services Agreement
Dispersion Services Agreement
Confidential Disclosure and License Agreement
Trademark License Agreement
Barry, Wales Sublease Agreement
Employee Matters Agreement
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Schedule 2.01(a)(i)(A)
Contracts and Agreements
1. Services Agreement between Cabot Corporation and Davies Imperial
Coatings, dated October 27, 1998, assigned in accordance with Amendment No. 1.
2. Asset Purchase and Termination Agreement by and among Cabot
Corporation, Rippey Corporation and David Rippey, dated June 30, 1995.
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Schedule 2.01(a)(i)(B)
Leasehold Interests in Real Property
1. 881 Embarcadero Drive, Suite # 4
El Dorado Hills, CA 95762
2. 801 Frontenac Road
Naperville, IL 60563
3. 1818 E. Southern Avenue, Suite # 15C
Mesa, AZ 85204
4. Heung-kuk Bldg.(7F), 6-7 Soo-nae Dong, Bundang-Gu
Sungnam-Si, Kyongki-Do, Korea
5. No. 14, Lane 268, Kuang-Fu Road,
Section 1, Hsin-Chu City,
Taiwan, ROC
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Schedule 2.01(a)(i)(C)
Real Property
1. 870 Commons Drive
Aurora, IL 60504
2. 500 Commons Drive
Aurora, IL 60504
3. 845 Enterprise Street
Aurora, IL 60504
4. 1287-19 Oazo-Kitakoyama
Geino-Cho, Age-Gun, Mie-Ken, Japan
5. Ansung Industrial Park
267-4 Kyeluk-ri, Miyang-Myun, Ansung-City, Korea
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Schedule 2.01(a)(i)(D)
Management Information Systems and Software
1. The following hardware located at CMC's facilities in Aurora,
Illinois and Geino, Japan:
- personal computers
servers
computer wiring
networking equipment (including hubs, routers and switches)
phones, PBX's and voice mail systems, excluding leased equipment
fax machines
facility security systems
2. The following software resident on personal computers located at CMC's
facilities:
- Microsoft Windows and Office
Lotus Notes
ADP
Anstat
3. The personal computers (other than control room hardware) and fax
machines located in the dispersions building in Barry, Wales, as well as the
license to any of the software set forth in 2 above which is on such personal
computers, which may be assigned.
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Schedule 2.01(a)(i)(E)
Licenses, Permits and Franchises
[Intentionally left blank]
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Schedule 2.01(a)(i)(F)
Intellectual Property
1. The patents set forth in the Worldwide Patent Assignment, Schedule
A, between Cabot Corporation and CMC, executed in conjunction with this Master
Separation Agreement.
2. The trademarks set forth in the Worldwide Trademark Assignment,
Schedule A, between Cabot Corporation and CMC, executed in conjunction with this
Master Separation Agreement.
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Schedule 2.01(e)(ii)
Excluded Management Information Systems and Software
1. Any software and information system hardware, other than as specifically set
forth in Schedule 2.01(a)(i)(D) above, which is licensed to or owned by Cabot.
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Schedule 2.01(e)(iii)(A)
Excluded Trademarks and Service Marks
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.
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Schedule 2.01(e)(iii)(B)
Excluded Patents
The following patents are specifically excluded, as they are addressed in the
Confidential Disclosure and License Agreement:
Country Applic. No. Filing Date Patent No. Grant Date
ASTL 52010/90 21MR1990 625980 21MR1990
BELG 9000319 21MR1990 BR266/90 02JL1991
BRAZ PI9001302 21MR1990 PI9001302 25NO1997
CANA 2012719-8 21MR1990 2012719 08JE1999
CHIN 90101525 21MR1990 28833 16OC1994
FRAN 9003557 20MR1990 9003557 11FE1994
GBRI 9006122.7 19MR1990 2229432 19MR1990
GERW P4006392.5 01MR1990
INDI 869/MAS/89 29NO1989 175167 01DE1995
ITAL 19748A90 21MR1990 01239546 05NO1993
JAPA 2-68568 20MR1990 2949633 09JL1999
KORS 3705/1990 20MR1990 148692 29MY1998
MAYS PI9000449 21MR1990
MEXI 19969 20MR1990 176811 05DE1994
TAIW 79100101 08JA1990 NI-43287 02AP1991
THAI 010174 26JA1990 7128 11SE1997
USA 07/829609 30JA1992 5246624 21SE1993
USA 07/326891 1MR1989 5116535 26MY1992
ASTL 52009/90 21MR1990 631847 21MR1990
BELG 9000320 21MR1990 9000320 27AU1991
BRAZ PI9001239 15MR1990 PI9001239 25NO1997
CANA 2012718-0 21MR1990 2012718 03DE1996
CHIN 90101086 28FE1990 29805 22JA1995
FRAN 9003558 20MR1990 9003558 04FE1994
GBRI 9006121.9 19MR1990 2229715 14OC1992
GERW P4006393.3-41 01MR1990
INDI 912/MAS/89 11DE1989 175056 03NO1995
ITAL 19747A90 21MR1990 01241073 29DE1993
JAPA 2-68569 20MR1990 2935125 04JE1999
KORS 3706/1990 20MR1990 145729 06MY1998
MAYS PI9000448 21MR1990
MEXI 19968 20MR1990 176602 14NO1994
TAIW 79102182 20MR1990 NI-44248 10MY1991
THAI 010175 26JA1990
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Schedule 2.01(e)(iii)(C)
Other Excluded Intellectual Property
1. Dispersion Intellectual Property (as defined in the Confidential
Disclosure and License Agreement) is excluded, as it is addressed in the
Confidential Disclosure and License Agreement.
2. Any Intellectual Property related to (i) treated or untreated fumed
metal oxide particles or the manufacture or treatment of fumed metal oxide
particles; or (ii) cesium chemicals or other products of Cabot's Performance
Materials Division or the manufacture thereof; or (iii) treated or untreated
aerogels, xerogels and other gel based materials or the manufacture or treatment
of such particles.
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Schedule 2.01(e)(v)
Other Excluded Assets
1. Any specifications, procedures and other documentation related to
the manufacture of fumed metal oxide dispersions for non-chemical mechanical
planarization applications which are located in Aurora, Illinois, Barry Wales or
any other facilities operated by the MMD Business.
2. All employee confidentiality and non-disclosure agreements entered
into between Cabot and employees of the MMD Business.
3. Non-disclosure agreements entered into by Cabot Corporation with
parties who work with Cabot Corporation outside of the MMD Business.
4. The air compressor, filter and air receiver located adjacent to the
leased dispersions facility in Barry, Wales.
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Schedule 5.04
Litigation
1. Rodel, Inc. v. Cabot Corporation, Civil Action No. 98-352 (D. Del.)
2. Rodel, Inc. v. Cabot Corporation, Civil Action No. 99-256 (D. Del.)
3. Cabot Corporation v. Solution Technology, Inc., Civil Action No.:
3.96CV505-McK(WD NC).
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