EXHIBIT 10.2
 
 
SHAREHOLDERS AGREEMENT
 
BETWEEN
 
ALL THE
 
SHAREHOLDERS
 
OF
 
QUÉBEC SILICON GENERAL PARTNER INC.
 
 
October 1, 2010
 
 
 

 

 
 
 

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TABLE OF CONTENTS
 
1.           DEFINITIONS2
 
2.           BUSINESS AND AFFAIRS OF THE COMPANY8
 
3.           THE SHAREHOLDERS8
 
4.           ISSUANCE OF SHARES9
 
5.           SECURITY INTERESTS10
 
6.           TRANSFER OF SHARES10
 
7.           MANAGEMENT OF THE COMPANY11
 
8.           RECORDS, REPORTS AND REPORTING15
 
9.           DEFAULT OF A SHAREHOLDER17
 
10.           CONFIDENTIALITY18
 
11.           INDEMNIFICATION20
 
12.           DISPUTE RESOLUTION20
 
13.           GENERAL23
 
 

 

 
 
 

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SHAREHOLDERS AGREEMENT
 
 
THIS SHAREHOLDERS AGREEMENT dated October 1, 2010,
 
BY AND BETWEEN:
BÉCANCOUR SILICON INC., a company governed by the laws of Québec;

 
(hereinafter called "BSI")
 
AND:
DOW CORNING NETHERLANDS, B.V., a corporation governed by the laws of the
Netherlands;

 
(hereinafter called "DCC GP Co")
 
AND:
QUÉBEC SILICON GENERAL PARTNER INC., a company governed by the laws of Québec;

 
(hereinafter called the "Company")
 
WHEREAS the Company has been incorporated under the Act (as defined herein);
 
WHEREAS BSI and the Company formed as of August 18, 2010, a limited partnership,
"Silicium Québec Société en commandite", in its French language version, and
"Québec Silicon Limited Partnership", in its English language version (the
"Partnership"), under the laws of the Province of Québec, to operate the
Business (as defined in the Amended and Restated Limited Partnership Agreement)
pursuant to the terms of a limited partnership agreement (the "Original Limited
Partnership Agreement");
 
WHEREAS at the time that the Original Limited Partnership Agreement was entered
into, BSI was the sole shareholder of the Company, holding 51 Class A Shares (as
defined below);
 
WHEREAS the Company is the general partner of the Partnership;
 
WHEREAS on the date hereof, BSI, DCC LP Canco (as defined below), and the
Company entered into an amended and restated limited partnership agreement (as
amended from time to time, the "Amended and Restated Limited Partnership
Agreement") to, inter alia, introduce DCC LP Canco as a special partner of the
Partnership;
 
WHEREAS on the date hereof, DCC GP Co subscribed for 49 Class B Shares of the
Company;
 
WHEREAS BSI and DCC GP Co are the owners of all the issued and outstanding
shares in the capital of the Company as follows:
 
Name
Class and number of
shares issued
Percentage of Voting Securities
BSI
51 Class A shares
51%
DCC GP Co
49 Class B Shares
49%

 
WHEREAS the percentage of units held in the Partnership by BSI and DCC LP Canco
(excluding the 100 units held by the Company as general partner of the
Partnership) is also 51% and 49%, respectively;
 
WHEREAS the Company, as general partner of the Partnership, is authorized and
required under the Amended and Restated Limited Partnership Agreement to manage,
control, administer and operate the Partnership and its business and affairs and
to represent the Partnership in accordance with the Amended and Restated Limited
Partnership Agreement;
 
WHEREAS BSI, DCC GP Co and the Company desire to enter into this shareholders
agreement to provide for the conduct of the business and affairs of the Company,
to provide for restrictions on the transfer and ownership of shares in the
capital of the Company and to govern their relationship as shareholders;
 
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the Parties hereby agree as follows:
 
1.  
DEFINITIONS

 
1.1  
In this Agreement, the following expressions shall have the following meanings,
unless there is something in the context inconsistent therewith:

 
"Absolute Control" means:
 
(i)  
in relation to a Person that is a corporation, the ownership, directly or
indirectly, of voting securities of such Person carrying all of the voting
rights attaching to all voting securities of such Person (other than Qualifying
Shares, if any) and which are sufficient, if exercised, to elect the entirety of
its board of directors; and

 
(ii)  
in relation to a Person that is a partnership, limited partnership, mutual fund
trust, trust or other similar unincorporated entity or association of any
nature, the ownership, directly or indirectly, of voting securities of such
Person (including the general partner thereof, as the case may be) carrying all
of the voting rights attaching to all voting securities of such Person
(including the general partner thereof, as the case may be) or the ownership of
all of the other interests or rights entitling the holder thereof to exercise
exclusive control and direction over the management and policies of such Person,
as the case may be; and "Absolutely Controls" and "Absolutely Controlled" shall
have similar meanings;

 
"Absolutely Controlled Affiliate" means, in relation to any Person, any other
Person that is Absolutely Controlled by the first-mentioned Person;
 
"Act" means the Canada Business Corporations Act, as the same may be amended,
supplemented or restated from time to time;
 
"Affiliate" means, in relation to any Person, any other Person that, directly or
indirectly, (i) Absolutely Controls the first-mentioned Person, (ii) is an
Absolutely Controlled Affiliate of the first-mentioned Person or (iii) is under
common Absolute Control with the first-mentioned Person;
 
"Affiliated Person" means, in relation to any Person, any other Person that,
directly or indirectly, Controls or is Controlled by or under common Control
with the first-mentioned Person;
 
"Agreement" means this shareholders agreement, all schedules attached hereto and
any agreement or schedule amending this Agreement; the words "hereto", "herein",
"hereinabove", "hereinafter", "hereof", "hereby" and "hereunder" and similar
expressions refer to this Agreement and not to any particular section, clause or
part of it;
 
"Amended and Restated Limited Partnership Agreement" has the meaning ascribed
thereto in the preamble;
 
"AMG" means Advanced Metallurgical Group N.V. or its Affiliated Persons;
 
"Annual Budget" has the meaning ascribed thereto in Section 7.8.4;
 
"applicable Law" has the meaning ascribed thereto in the definition of Laws;
 
"Board" means the board of directors of the Company;
 
"BSI" means Bécancour Silicon Inc.;
 
"BSI Parent" means Timminco Limited, a corporation organized under the laws of
Canada;
 
"BSI Representatives" has the meaning ascribed thereto in Section 7.1;
 
"Business Day" means any day of the year, other than a Saturday, Sunday or other
day on which banks are closed for business in Montreal, Québec or New York, New
York;
 
"Class A Shares" means the class A shares in the capital of the Company;
 
"Class B Shares" means the class B shares in the capital of the Company;
 
"Company" has the meaning ascribed thereto in the preamble;
 
"Confidential Information" has the meaning ascribed thereto in Section 10.1;
 
"Control" means:
 
(i)  
in relation to a Person that is a corporation, the ownership, directly or
indirectly, of voting securities of such Person carrying more than 50% of the
voting rights attaching to all voting securities of such Person (Qualifying
Shares, if any, in the capital of such Person being deemed to be owned by the
largest shareholder of such Person) or which are sufficient, if exercised, to
elect the majority of its board of directors; and

 
(ii)  
in relation to a Person that is a partnership, limited partnership, mutual fund
trust, trust or other similar unincorporated entity or association of any
nature, the ownership, directly or indirectly, of voting securities of such
Person (including the general partner thereof, as the case may be) carrying more
than 50% of the voting rights attaching to all voting securities of such Person
(including the general partner thereof, as the case may be) or the ownership of
more than 50% of other interests or rights entitling the holder thereof to
exercise, control and direction over the management and policies of such Person,
as the case may be; and "Controls", "Controlled" and "Controlling" shall have
similar meanings; provided that Dow Chemical Company and Corning Incorporated
each shall be deemed to be a Person in Control of DCC GP Co Parent so long as it
owns at least 50% of the outstanding share capital of DCC GP Co Parent and AMG
shall be deemed to be a Person in Control of BSI Parent so long as it owns at
least 40% of the outstanding share capital of BSI Parent;

 
"Controlled Affiliated Person" means, in relation to any Person, any other
Person that is Controlled by the first-mentioned Person;
 
"Corresponding Pro-Rata Share" means a percentage determined by dividing the
number of Units Transferred by a Shareholder or an Affiliate, as a Special
Partner, to a third party or any Affiliate thereof, by the total number of
issued and outstanding Units held by such Shareholder or Affiliate at the time
the calculation is made;
 
"DCC GP Co" has the meaning ascribed thereto in the preamble;
 
"DCC GP Co Parent" means Dow Corning Corporation;
 
"DCC GP Co Representatives" has the meaning ascribed thereto in Section 7.1;
 
"DCC LP Canco" means Dow Corning Canada, Inc., a corporation organized under the
laws of Canada;
 
"Defaulting Partner" means a Special Partner in respect of which a Default, as
defined in the Amended and Restated Limited Partnership Agreement, has occurred;
 
"Facility" means the silicon metal facility located at 6500 Rue Yvon Trudeau,
Bécancour, Québec;
 
"Framework Agreement" means that certain Framework Agreement, dated as of
August 10, 2010, by and among DCC GP Co Parent, BSI Parent and BSI, as the same
may be amended from time to time;
 
"GAAP" means the accounting principles generally accepted in Canada from time to
time, including the policies and standards of disclosure recommended by the
Canadian Institute of Chartered Accountants from time to time, applied in a
consistent manner from period to period;
 
"Governmental Authority" means any: (i) federal, provincial, regional, local,
municipal, foreign, international, multinational, territorial, state or other
government, governmental or public department, central bank, court, tribunal,
arbitral body, statutory body, commission, board, bureau or agency, domestic or
foreign; (ii) subdivision, agent, commission, board or authority of any of the
foregoing; or (iii) quasi-governmental, private body or regulatory entity
exercising any regulatory, expropriation or taxing authority under, or for the
account of, any of the foregoing, including any stock exchange;
 
"IFRS" means International Financial Reporting Standards, as in effect from time
to time;
 
"Including", "include" and words of similar import, when following any general
statement, term or matter, shall not be construed to limit such statement, term
or matter to the specific items or matters set forth immediately following such
word or to similar items or matters, whether or not non-limiting language (such
as "without limitation", or "but not limited to", or words of similar import) is
used with reference thereto, but rather shall be deemed to refer to all other
items or matters that could reasonably fall within the broadest possible scope
of such general statement, term or matter;
 
"Insolvent" means, with respect to the applicable Person on any date of
determination, satisfying the definition of an "insolvent person" contained in
Section 2 of the Bankruptcy and Insolvency Act (Canada), and "Insolvency" means
the condition of being Insolvent;
 
"Laws" means all statutes, codes, treaties, directives, ordinances, decrees,
rules, regulations, municipal by-laws, judicial or arbitral or administrative or
ministerial or departmental or regulatory judgments, orders, decisions, terms
and conditions of any grant, approval, permission, authority or license, rulings
or awards, policies, voluntary restraints, guidelines, or any provisions of the
foregoing, of any Governmental Authority or self-regulatory entity, in each case
which have the force of law, including any interpretation thereof and any
decision, doctrine or recommendations from any Governmental Authority or
self-regulatory entity, in each case which have the force of law, and general
principles of common and civil law and equity, in each case which have the force
of law; and "Law" means any one of the foregoing, and the term "applicable,"
with respect to such Law and in the context that refers to one or more Persons,
means that such Law applies to such Person or Persons or its or their business,
undertaking, property, assets or securities and emanates from a Governmental
Authority or self-regulatory entity having jurisdiction over the Person or
Persons or its or their business, undertaking, property, assets or securities;
 
"Management" means the management of the Company, consisting of individuals
either appointed by the Board or acting as officers pursuant to the Services
Agreement;
 
"Non-Defaulting Partner" means any Special Partner which is not a Defaulting
Partner;
 
"Operating Committee" has the meaning ascribed thereto in Section 7.9;
 
"Original Limited Partnership Agreement" has the meaning ascribed thereto in the
preamble;
 
"Partnership" has the meaning ascribed thereto in the preamble;
 
"Partnership Interest" means the interest of a Partner in the Partnership
consisting of: (i) such Partner's interest and share in profits, losses,
reserves, holdbacks, allocations and distributions of the Partnership and its
common stock (as referred to in the Civil Code); (ii) such Partner's capital
account maintained on the books of the Partnership; (iii) such Partner's right
to vote or grant or withhold consents or approvals with respect to Partnership
matters (if any) as provided herein or in the Civil Code; and (iv) such
Partner's other rights, obligations and privileges as provided herein or in the
Civil Code, and includes Units;
 
"Party" means any of BSI, DCC GP Co or the Company and any other Person which
may hereafter agree to be bound by the terms of this Agreement in accordance
with the provisions hereof; and "Parties" means all of them;
 
"Person" means any individual, sole proprietorship, partnership, corporation or
company, with or without share capital, trust, foundation, joint venture or any
other incorporated or unincorporated entity or association of any nature;
 
"Qualifying Shares" means shares that a Person must hold to qualify as a
director of the issuing corporation under applicable Law, or shares held by a
Person or Persons (equal to no more than 1% of the issued and outstanding share
capital of the issuing corporation) so that the issuing corporation has the
minimum number of shareholders or members required under applicable Law;
 
"Representative" means a BSI Representative or a DCC GP Co Representative;
 
"Securities Act" means the Securities Act (Québec);
 
"Security Interest" means any mortgage, pledge, assignment by way of security,
security granted under the Bank Act (Canada), hypothec (legal or conventional,
immovable or movable, with or without delivery), pledge, security agreement,
financing or any other security interest on any property and any and all similar
arrangements, conditions or encumbrances on any property that in substance
secure payment or performance of an obligation, including any and all similar
arrangements, conditions or encumbrances on any property under any Law
applicable to any Shareholder;
 
"Services Agreement" means the services agreement or agreements between the
Partnership and BSI or Timminco, as the case may be, that sets forth the agreed
personnel and other shared services to be provided to, or by, the Partnership;
 
"Shareholders" means BSI and DCC GP Co and any other holder of Shares from time
to time which agrees to be bound by the terms of this Agreement in accordance
with the provisions hereof; and "Shareholder" means any one of the Shareholders;
 
"Shares" means any shares in the share capital of the Company of any class;
 
"Special Majority of the Board" means a majority of the Board which includes at
least one BSI Representative and one DCC GP Co Representative;
 
"Special Partner" means BSI and DCC LP Canco, for so long as they remain special
partners of the Partnership, and any other Person which becomes and remains a
special partner of the Partnership in accordance with the provisions of the
Amended and Restated Limited Partnership Agreement; and "Special Partners" is
the collective reference to all such parties;
 
"Special Pro-Rata Share" means, in relation to a Special Partner, a percentage
determined by dividing the number of Units held by such Special Partner in the
Partnership by the total number of issued and outstanding Units which are held
by all Special Partners in the Partnership at the time the calculation is made,
provided that the total of all Special Pro Rata Shares shall always be equal to
100%;
 
"Supply Agreement" means the agreement among the Partnership, BSI and DCC GP Co
Parent (or their permitted designees) entered into on the date hereof, as the
same may be amended from time to time, regarding the supply and allocation of
silicon metal output from the Business (as defined in the Amended and Restated
Limited Partnership Agreement);
 
"Transfer" means, in respect of a Partnership Interest or Shares, a transfer,
sale, exchange, assignment, creation of a Security Interest or other encumbrance
or disposition, including the grant of an option or other right, whether
directly or indirectly through the transfer of equity interests of an Affiliate
substantially all of whose assets are comprised of a Partnership Interest or GP
Shares, whether voluntarily, involuntarily, by operation of law or pursuant to a
merger, consolidation or similar business combination, of or in relation to such
Partnership Interest and/or Shares; provided, that (i) a transfer of equity
interests in BSI Parent shall not be deemed a Transfer (although may represent a
Change of Control Event), (ii) a transfer of the equity interests of DCC GP Co
Parent shall not be deemed a Transfer, (iii) a reorganization involving BSI and
BSI Parent whereby BSI is merged or wound-up into BSI Parent shall not be deemed
a Transfer and a reorganization of DCC GP Co and DCC GP Co Parent (or one of its
Affiliates) whereby DCC GP Co is merged or wound-up into DCC GP Co Parent (or
one of its Affiliates) shall not be deemed a Transfer and (iv) "Transferred",
"transferred" "Transferor" and "Transferee" each have a correlative meaning. The
foregoing notwithstanding, the grant of a Security Interest in a Partnership
Interest or Shares to a financial institution in connection with any bona fide
loan to a Shareholder or its Affiliates from such financial institution in which
such financial institution does not have the power to vote or dispose of such
Partnership Interest or Shares other than in case of a default caused by the
action or inaction of such Shareholder, and, in such case, such financial
institution holds the Partnership Interest or Shares subject to the terms and
conditions of the Amended and Restated Limited Partnership Agreement or this
Agreement (including, without limitation, subject to the provisions of Section 6
hereof), as applicable, and which Security Interest shall be automatically
released upon a Special Partner's exercise of any call rights under
Sections 10.7 and 16.5 (or any successor provisions) of the Amended and Restated
Limited Partnership Agreement, shall not be deemed a Transfer;
 
"Ultimate Parent" means in respect of DCC GP Co, Dow Corning Corporation, and in
respect of BSI, BSI Parent; and in respect of any other Person which shall
become a Shareholder, the Person designated by such Shareholder as being its
Ultimate Parent and accepted by all of the other Shareholders; and
 
"Units" means the units evidencing the Partnership Interest of a partner in the
Partnership.
 
2.  
BUSINESS AND AFFAIRS OF THE COMPANY

 
2.1  
Purpose of the Company.  The Company was established for the purpose of acting
as general partner of the Partnership. The business of the Company will be
limited to fulfilling the obligations and carrying out the duties of the general
partner under the Amended and Restated Limited Partnership Agreement, and in
engaging in any activities directly or indirectly related thereto.

 
2.2  
Head Office.  The head office of the Company shall be located at 6500 Rue Yvon
Trudeau, Bécancour, Québec, or at such other location approved by the Board.

 
2.3  
Fiscal Year.  The fiscal year of the Company will end on December 31 of each
year, or at such other date approved by the Board.

 
3.  
THE SHAREHOLDERS

 
3.1  
Status and Capacity of the Shareholders and the Company. Each Shareholder hereby
represents and warrants to and covenants with the Company and the other
Shareholder, and the Company hereby represents and warrants to and covenants
with the Shareholders (excluding the provisions of Section 3.1.8 as regards the
Company), that:

 
3.1.1  
Subsistence.  It is duly formed, constituted, created, incorporated, amalgamated
or continued, as the case may be, and validly existing under the Laws of its
jurisdiction of formation, constitution, creation, incorporation, amalgamation
or continuation, and it has the capacity to own its assets and properties;

 
3.1.2  
Capacity.  It has the capacity and authority to enter into and be bound by this
Agreement;

 
3.1.3  
Authorizations.  This Agreement has been duly authorized, executed and delivered
by it;

 
3.1.4  
No Conflict.  The signing, delivery and performance by it of this Agreement do
not violate any of its articles, by-laws or other constating documents, or any
agreements to which it is a party or any Law applicable to it, except for such
violations which would not have a material adverse effect on the Company or the
Shareholders;

 
3.1.5  
Legally Binding.  This Agreement constitutes legal, valid and binding
obligations of such Person, enforceable against it in accordance with its terms;

 
3.1.6  
No Bankruptcy or Insolvency.  It is neither bankrupt nor Insolvent, and there
are no proceedings pending or being contemplated by it, and/or to its knowledge,
threatened against it, which would result in it being or becoming bankrupt or
Insolvent;

 
3.1.7  
Legal Proceedings.  There is not pending or, to its knowledge, threatened
against it any legal proceedings that could have a material adverse effect on
the Company or the Shareholders; and

 
3.1.8  
Title to Shares.  Each Shareholder owns the Shares registered in its name free
and clear of any Security Interest.

 
3.2  
Each Shareholder hereby covenants and agrees that it shall not change its status
under Section 3.1.6 as represented and warranted herein and, in addition to the
Transfer restrictions set out in Section 6, shall not Transfer any of its Shares
to any Person which would be unable to make the representations and warranties
set forth in this Section 3.1.

 
4.  
ISSUANCE OF SHARES

 
4.1  
General Rule.  Unless otherwise agreed in writing between all Shareholders and
except as provided in this Agreement, the Shareholders hereby agree that no
Shares of the Company shall be issued from the Company's treasury unless issued
pro-rata to the number of Shares held by each Shareholder and for a nominal
price.

 
4.2  
Number of Shares to be held by any Shareholder.  The Company shall take all
necessary action, including issuing Shares for a nominal value and splitting
Shares if necessary, in order to ensure that each Shareholder holds at any time
a number of Shares corresponding to the Special Pro-Rata Share that it (or an
Affiliate) holds as a Special Partner of the Partnership. Each Shareholder
hereby constitutes and appoints the Company its true and lawful attorney, agent
and mandatary, with full power and authority, in its name, place and stead, and
for its use and benefit, to execute such instruments and documents as may be
necessary to carry on the intent of this Section 4.1.

 
5.  
SECURITY INTERESTS

 
5.1  
Limitation on Security Interests.  Except with the prior written agreement of
the other Shareholder, no Shareholder shall create or suffer to be created any
Security Interest on any of its Shares or its rights under this Agreement, the
Amended and Restated Limited Partnership Agreement or the Supply Agreement, if
such granting would not constitute a permitted Transfer hereunder. Any purported
Security Interest that is not in compliance with this Section 5.1 shall be void
as between the Shareholders and the Company.

 
5.2  
Security Interest by Operation of Law.  Section 5.1 shall not apply to any
Security Interest on the Shares or the rights under this Agreement, the Amended
and Restated Limited Partnership Agreement or the Supply Agreement arising from
or imposed by any applicable Law which secures payment or performance of any
obligations by any Shareholder and is contested in good faith by appropriate
proceedings.

 
6.  
TRANSFER OF SHARES

 
6.1  
Prohibition on Transfer.  For a period of five years after the date hereof, no
Shareholder shall Transfer all or any of its Shares except with the prior
written agreement of the other Shareholder (which consent may be withheld for
any or no reason), except as provided in Section 6.5. In addition, no
Shareholder may at any time Transfer less than all of its Shares. All permitted
Transfers (other than Transfers contemplated by Section 6.5) are subject to a
corresponding Transfer of all of a Shareholder's (or, as applicable, its
Affiliate's) Partnership Interest and, except as otherwise expressly provided,
rights and obligations under the Supply Agreement.

 
6.2  
No Violation of Applicable Laws.  Notwithstanding anything herein to the
contrary, no Shareholder shall be entitled to Transfer any Shares at any time if
such Transfer would violate applicable Laws.

 
6.3  
Transfers in Violation of this Agreement.  Any purported Transfer by a
Shareholder of all or any of its Shares other than in accordance with this
Agreement (including, without limitation, a Transfer of Shares without a
corresponding Transfer of all of a Shareholder's (or, as applicable, its
Affiliate's) Partnership Interest and rights and obligations under the Supply
Agreement) shall be null and void, and the Company shall refuse to recognize any
such Transfer of such Shares for any purpose and shall not reflect in the
Register any change in ownership of such Shares pursuant to any such Transfer.
Any purported Transferee of a Transfer which is null and void pursuant to this
Agreement shall have no rights as a Shareholder pursuant to this Agreement.

 
6.4  
Transfer to a Third Party.  Notwithstanding any other provisions of this
Agreement, upon the Transfer by a Shareholder or its Affiliate of all or any
part of that Person's Partnership Interest to a third party in accordance with
the provisions of Section 10 of the Amended and Restated Limited Partnership
Agreement, the Shareholder shall concurrently Transfer its Corresponding
Pro-Rata Share of the Shares they hold in the Company to such third party or to
an Affiliate thereof, for a cash purchase price, and such Transferee shall be
automatically bound by the provisions of this Agreement upon the occurrence of
such Transfer. Furthermore, the right of first refusal under Section 10.4 (or
any successor provisions) of the Amended and Restated Limited Partnership
Agreement; tag-along rights under Section 10.5 (or any successor provisions) of
the Amended and Restated Limited Partnership Agreement; put rights under
Section 10.6 (or any successor provisions) of the Amended and Restated Limited
Partnership Agreement; and call rights under Sections 10.7 and 16.5 (or any
successor provisions) of the Amended and Restated Limited Partnership Agreement;
shall apply, mutatis mutandis to the Transfer of Shares by Shareholders to third
parties.  As a condition to any such Transfer, the Transferor shall enter into
any such agreements reasonably requested to acknowledge such Transferee's
obligations hereunder.

 
6.5  
Transfer to Affiliates.  Notwithstanding anything herein to the contrary, a
Shareholder may Transfer any Shares to an Affiliate of such Shareholder without
triggering any rights under Section 6.4; provided that such Affiliate agrees to
be bound to the terms of this Agreement as if it were the Transferor and
executes a copy of this Agreement so providing.

 
6.6  
Expenses.  Any Shareholder that proposes to Transfer any Shares in accordance
with the terms and conditions hereof shall be responsible for any expenses
incurred by the Company in connection with such Transfer.

 
7.  
MANAGEMENT OF THE COMPANY

 
7.1  
Board of Directors.  Unless the Shareholders by unanimous decision otherwise
agree, there will be five (5) directors of the Company and, subject to
Section 7.2, three (3) of such directors will be appointed by BSI (each director
so appointed, a "BSI Representative") and two (2) of such directors will be
appointed by DCC GP Co (each director so appointed, a "DCC GP Co
Representative"). Subject to Section 7.8, an affirmative vote of a majority of
directors or the written consent of all directors shall constitute Board action.
The Board shall meet quarterly (unless otherwise requested to meet more
frequently by any director) for the purpose of reviewing the operations and
financial status of the Company and for receiving reports from Management and
the Operating Committee regarding operational matters including the parameters
of a budget, pricing of output and related production schedules under the Supply
Agreement and any disputes between the parties to this Agreement, the Amended
and Restated Limited Partnership Agreement and the Supply Agreement. Any
committees or subcommittees of the Board may be formed and shall be comprised of
an equal number of BSI Representatives and DCC GP Co Representatives, and shall
have such power and authority as is delegated by the Board; provided that any
action requiring a Special Majority of the Board may only be approved by the
Board upon receipt of the required vote.

 
7.2  
Modification to Number of Appointees.

 
7.2.1  
The number of directors that DCC GP Co will be entitled to appoint to the Board
will be increased from two (2) to three (3) and the number of directors that BSI
will be entitled to appoint to the Board will be reduced from three (3) to two
(2) upon the occurrence of any of the following events:

 
7.2.1.1  
the foreclosure by any lender to BSI or any of its Affiliates regarding the
Partnership Interest or Class A Shares of BSI or its Affiliates or their
interests in the Supply Agreement;

 
7.2.1.2  
BSI and its Affiliates fail to take at least twenty-five percent (25%) of the
output of the Facility over a two-year period (unless and until BSI and its
Affiliates acquire at least forty percent (40%) of the output for a subsequent
two-year period of time); or

 
7.2.1.3  
BSI fails to make a Mandatory Capital Contribution (as defined in the Amended
and Restated Limited Partnership Agreement), unless DCC GP Co also fails to make
its corresponding Mandatory Capital Contribution.

 
7.2.2  
To the extent that any Shareholder fails to elect the required number of
directors, the size of the board of directors shall be automatically adjusted to
reflect such failure (but only for so long as such failure continues) and the
provisions of Section 6 shall not be applicable for so long as such Shareholder
has failed to elect any directors.

 
7.3  
[Reserved].

 
7.4  
Initial Representatives.  The initial BSI Representatives and DCC GP Co
Representatives are set out at Schedule 7.4 hereto.

 
7.5  
Replacement of Directors.  A Representative may be removed and replaced by his
or her nominating Shareholder at any time by written notice to the other
Shareholders. If a director should be or become unavailable to serve or
otherwise fail to vote or act as a director to carry out the terms of this
Agreement, then at the written request of any Shareholder, the Shareholder whose
Representative has not acted will immediately designate by notice in writing to
the other Shareholder an individual to serve as a replacement Representative to
carry out the terms of this Agreement.

 
7.6  
Executive Officers.  Subject to the Services Agreement, the directors will
appoint one or more executive officers to manage or execute the business of the
Company consistent with Section 2.1. The officers may include a president, a
vice president, a controller/treasurer, a secretary and such other officers as
the Board may determine. Notwithstanding the Services Agreement, DCC GP Co will
have the right, but not the obligation, to appoint, from time to time, the
Company's chief financial officer or a senior financial officer.

 
7.7  
Officers to Manage.  Unless otherwise provided in this Agreement, the conduct of
the business of the Company will be governed in accordance with the articles of
the Company and managed by Management under the direction of the Board. The
Board shall monitor the affairs of the Company and provide ongoing direction to
Management as required.

 
7.8  
Significant Corporate Action.  The following actions of the Company may only be
taken after obtaining the approval of a Special Majority of the Board:

 
7.8.1  
Termination, Liquidation or Dissolution.  Except as otherwise provided in this
Agreement, any action or steps to terminate, dissolve, wind-up or liquidate the
Company or the Partnership, including the filing of any petition under the
applicable bankruptcy or insolvency laws;

 
7.8.2  
Acquisitions.  Any action or steps to have the Company or the Partnership
acquire (by merger, consolidation, or acquisition of equity or assets) any
corporation, partnership or other business organization or division thereof;

 
7.8.3  
Formation of Subsidiaries.  The formation of any subsidiary by the Company;

 
7.8.4  
Annual Budgets.  The approval or material modification of the annual operating
and capital budget of the Partnership and of the Company (the "Annual Budget");

 
7.8.5  
Cash Calls.  The adoption or modification of any cash-call forecast of the
Partnership and the effecting of any cash calls by the Partnership, other than
as contemplated in the Annual Budget or the provisions of the Amended and
Restated Limited Partnership Agreement;

 
7.8.6  
Intellectual Property.  The sale, disposition, license, transfer or encumbrance
by the Partnership of any material intellectual property;

 
7.8.7  
Change to Partnership's Operations.  A change to the Partnership's operations
that would materially adversely affect the overall output or production levels
of the products contemplated by the Supply Agreement (without the consent of the
relevant third parties to the various output agreements);

 
7.8.8  
Acquisition or Sale of Assets.  The acquisition, sale, lease or disposition of
any material assets by the Company or the Partnership which, individually or in
the aggregate, have a value of over $500,000, individually, or $2,000,000 in the
aggregate in any twelve-month period, except (i) as contemplated in the Annual
Budget, or (ii) for acquisitions, sales, leases or dispositions in the ordinary
course of business;

 
7.8.9  
Indebtedness.  Any borrowing of money by the Partnership or by the Company or
the issuing of promissory notes, evidences of indebtedness or other negotiable
or non-negotiable instruments by the Partnership or the Company (except for
working capital borrowings in the ordinary course of business) and, in each
case, the aggregate consideration therefor exceeding $500,000, other than as
contemplated in the Annual Budget (if pursuant to a facility or facilities then
in effect);

 
7.8.10  
Contractual Obligations.  The entering into of any agreement by the Company or
the Partnership (other than purchase orders in the ordinary course of business)
with annual payment obligations expected to exceed $500,000 or which has a
duration of three years or more and under which payments are expected to exceed
$1,500,000 in the aggregate or the entering into by the Company or the
Partnership of any power supply agreement or collective bargaining agreement,
other than as contemplated in the Annual Budget;

 
7.8.11  
Guarantees, Loans.  The assumption, guarantee or endorsement of the obligations
of any other Person by the Company or the Partnership, or the making by the
Company or the Partnership of any loans, advances or capital contributions, or
investments in, any other Person, other than short-term investments of cash on
hand in the ordinary course of business;

 
7.8.12  
Dividends and Distributions.  The declaration, setting aside or payment of any
dividend or other distribution to equity-holders by the Company or the
Partnership, irrespective of the form of such dividend or distribution, other
than certain special distributions expressly permitted by the Amended and
Restated Limited Partnership Agreement, distributions for the payment of taxes
in accordance with the Amended and Restated Limited Partnership Agreement or
otherwise pursuant to dividend or distribution policies agreed to by the
Shareholders from time to time;

 
7.8.13  
Settlement of Debt.  The repurchase or redemption by the Company or the
Partnership of any security or debt (except to the extent such debt is due
according to its terms) other than the Note (as defined in the Amended and
Restated Limited Partnership Agreement);

 
7.8.14  
Issuance of Securities.  The issuance or sale by the Company or the Partnership
of any security, the registration of any security under the Securities Act or
the grant of registration rights with respect to any security;

 
7.8.15  
Related Party Transactions.  The entrance into by the Company or the Partnership
of any transaction or series of related transactions with a value greater than
$500,000 with any Shareholder or partner of the Partnership or any of their
Affiliates (other than pursuant to an existing agreement contemplated by the
Framework Agreement to remain in effect following the Closing thereunder or any
Ancillary Agreement) or any amendment of an existing agreement;

 
7.8.16  
Guarantee by the Partnership.  The entrance into any agreements where the
Company or the Partnership is, directly or indirectly, assuming responsibility
for the performance of any obligation of its partners or Shareholders or any of
their Affiliates, as applicable;

 
7.8.17  
Amendment to Organizational Documents.  The amendment of any provision of the
Company's organizational documents;

 
7.8.18  
Litigation.  The settlement of any litigation to which the Company or the
Partnership is a party for an amount in excess of $750,000 or on terms which may
reasonably have a material adverse effect on the Partnership's ability to
perform its obligations under the Supply Agreement;

 
7.8.19  
Accounting. Any material change in accounting or tax practices of the Company or
the Partnership, except as may be required by applicable Law or in connection
with the conversion to IFRS as of January 1, 2011;

 
7.8.20  
Auditors.  Any change in the auditors of the Company or the Partnership; and

 
7.8.21  
Compensation.  Any material increase in the compensation or benefits of any
officer of the Company.

 
7.9  
Operating Committee. Each of BSI and DCC GP Co shall appoint three (3) members
of their respective senior management teams to an executive operating committee
(the "Operating Committee").  The Operating Committee shall meet not more often
than once a quarter (unless requested to meet more frequently by any
Representative) and shall be generally responsible for receiving reports upon
and discussing operational matters between the parties, including, without
limitation, the parameters of a budget, pricing of output and related production
schedules, and disputes or differences between the Shareholders under this
Agreement, the Amended and Restated Limited Partnership Agreement, the Supply
Agreement or any of the other Ancillary Agreements (as defined in the Framework
Agreement).  The Operating Committee, which shall not have any power or
authority to bind the Company, shall report the results of its discussions to
the Board, and shall endeavour in good faith to provide a consensus view on
issues.  The manager of the Facility shall be an ex-officio member of the
Operating Committee.  The Operating Committee is a working committee of the
Company whose members need not be Representatives.  The initial Operating
Committee members are set forth on Schedule 7.9 hereto.

 
8.  
RECORDS, REPORTS AND REPORTING

 
8.1  
Records and Books of Account.  The Company shall keep at the principal office of
the Company appropriate books and records with respect to the Company's
business. Any books and records maintained by the Company in the regular course
of its business, including books of account and records of the Company
proceedings, may be kept on, or be in the form of, computer disks, hard disks,
magnetic tape or any other information storage device, provided that the books
and records so maintained are convertible in to clearly legible written form
within a reasonable period of time. The books of the Company shall be
maintained, for financial reporting purposes, on an accrual basis in accordance
with GAAP up to and including December 31, 2010, and with IFRS thereafter. The
Shareholders shall have access to, and may take copies from, all such books and
records at all reasonable times during regular business hours.

 
8.2  
Reports.

 
8.2.1  
Annual Financial Statements.  As soon as practicable, but in no event later than
twenty (20) days after the end of each fiscal year, the Company shall cause to
be delivered to each holder of a Share, a financial report and unaudited
financial statements (with notes attached thereto) of the Company for such
fiscal year, presented in accordance with GAAP up to and including December 31,
2010, and with IFRS thereafter, including a balance sheet and statements of
operations. The financial statements (with the notes attached thereto) shall be
audited and reported upon by the auditor of the Company and certified by one or
more officers or directors of the Company, in accordance with applicable Laws,
no later than twenty (20) Business Days after the end of each such fiscal year
and shall be sent to each holder of a Share no later than forty-five (45) days
after the end of such fiscal year.

 
8.2.2  
Quarterly Financial Statements.  As soon as practicable, but in no event later
than twenty (20) days after the end of each calendar quarter, the Company shall
cause to be delivered to each holder of a Share, a financial report and
unaudited financial statements of the Company for such calendar quarter,
presented in accordance with GAAP up to and including December 31, 2010, and
with IFRS thereafter, including a balance sheet and statements of operations,
such statements to be approved or certified by the directors or one or more
officers of the Company, in accordance with applicable Laws and such other
information as the Company determines to be necessary or appropriate.

 
8.2.3  
Other Information. In the event that any Shareholder requires any of the
foregoing reports or statements presented in a manner other than as described
above, the Company shall use its reasonable best efforts to satisfy such needs,
and such Shareholder shall reimburse the Company for any additional costs
incurred by the Company on its behalf.

 
8.3  
Accounting Policies.  Subject to Sections 7.8 and 8.4, the Company is authorized
to establish from time to time accounting policies with respect to the financial
statements of the Company and to change from time to time any policy that has
been so established so long as such policies are consistent with GAAP up to and
including December 31, 2010, and with IFRS thereafter.

 
8.4  
Auditor.  The Company shall cause the auditor of the Company to review and
report to the Shareholders upon the financial statements of the Company for and
as at the end of each fiscal year, and to advise upon and make determinations
with regard to financial questions relating to the Company or required by this
Agreement to be determined by the auditor of the Company. Until its successor is
appointed, the auditor of the Company shall be Ernst & Young LLP. The
Shareholders hereby agree that any successor auditor of the Company shall be
selected among the four (4) largest auditors in Canada.

 
8.5  
Audit.  The Shareholders (either directly or indirectly through an auditor or
legal counsel) shall have the right, at all reasonable times, to audit the
books, the registers and records of the Company and to discuss its affairs with
officers of the Company. In furtherance of the foregoing, the Shareholders
(either directly or indirectly through an auditor or legal counsel) shall have
the right to audit any transactions between the Company, on the one hand, and
any Shareholder (or Affiliate thereof), on the other.

 
9.  
DEFAULT OF A SHAREHOLDER

 
9.1  
Defaulting Partner.  Upon a Shareholder (or its Affiliate) becoming a Defaulting
Partner under the Amended and Restated Limited Partnership Agreement, such
Shareholder: (i) shall cease to nominate Representatives to the Board in
accordance with Section 7.1 and each director designated by such Shareholder
then in place shall be deemed to have resigned from office; and (ii) shall not
exercise voting rights attaching to the Shares, and its Shares shall be
disregarded for the purposes of any such vote. The Company shall release and
discharge each such director who is deemed to have resigned from any and all
claims, debts, liabilities, rights of action and other obligations and demands
whatsoever past, present or future, known or unknown, that the Company had or
may then or thereafter have against any or all of them for or by reason of their
being a director of the Company, as the case may be, other than in respect of
fraud, wilful misconduct and criminal acts.

 
9.2  
Purchase of a Defaulting Special Partner.  If a Shareholder (or its Affiliate)
becomes a Defaulting Partner under the Amended and Restated Limited Partnership
Agreement and the other Shareholder (as Non-Defaulting Partner under the Amended
and Restated Limited Partnership) or any Affiliate thereof elects to purchase
the Partnership Interest of the Defaulting Partner in accordance with the
provisions of Section 16.5 of the Amended and Restated Limited Partnership
Agreement, the Shareholder which is (or which is the Affiliate of) the
Defaulting Partner shall, concurrently and in the same proportions, Transfer all
Shares they hold in the share capital of the Company to the Shareholder which is
(or which is an Affiliates of) the non-Defaulting Partners, for a cash purchase
price equal to the amount appearing in the stated capital account of the Company
for such Transferred Shares.

 
The acquisition of the Shares of a Shareholder which is (or which is an
Affiliate of) a Defaulting Partner shall not release such Shareholder from any
of its obligations under this Agreement, to the extent that such obligations
existed prior to or arose from anything done or omitted to be done prior to the
time of purchase of such Shares pursuant hereto.
 
9.3  
Default of a Shareholder.  For the purposes of the provisions of Section 16.1(j)
of the Amended and Restated Limited Partnership Agreement, a default shall be
deemed to have occurred in respect of a Shareholder, if:

 
9.3.1  
an order, judgment or decree, is voluntarily obtained by a Shareholder or an
effective resolution is passed by such Shareholder pursuant to the Laws of any
applicable jurisdiction, for the winding-up, liquidation or dissolution of such
Shareholder; or

 
9.3.2  
a Shareholder makes an assignment for the benefit of its creditors, is deemed to
have made an assignment for the benefit of its creditors, files an assignment in
bankruptcy, or files a proposal or a notice of intention to file a proposal
under the Bankruptcy and Insolvency Act (Canada) or any successor legislation or
any similar legislation of any applicable jurisdiction, or applies for an order
under the Companies' Creditors Arrangement Act (Canada) or any similar
legislation of any applicable jurisdiction; or

 
9.3.3  
an order, judgment or decree is entered or obtained adjudging a Shareholder a
bankrupt, or granting a motion seeking the liquidation, winding-up, dissolution,
reorganization, arrangement, adjustment or composition of a Shareholder under
the Companies' Creditors Arrangement Act (Canada), the Bankruptcy and Insolvency
Act (Canada), or the Winding Up and Restructuring Act (Canada) or any successor
legislation or any similar legislation of any applicable jurisdiction; or

 
9.3.4  
proceedings are begun by a third party (i) for the appointment of a liquidator,
trustee in bankruptcy, custodian, sequestrator, receiver, receiver and manager
or any other Person with similar powers for a Special Partner or all or
substantially all of a Shareholder's assets or properties, or (ii) to have an
order for relief entered against such Shareholder as debtor or to adjudicate it
bankrupt or seeking the liquidation, winding-up, dissolution, reorganization,
arrangement, adjustment or composition under the Companies' Creditors
Arrangement Act (Canada), the Bankruptcy and Insolvency Act (Canada) or the
Winding-up and Restructuring Act (Canada) or any successor legislation or any
similar legislation of any applicable jurisdiction, unless the Shareholder is,
within ten (10) days and in good faith, disputing such proceedings and in any
event such proceedings are dismissed or withdrawn within ninety (90) days after
the commencement thereof; or

 
9.3.5  
a Shareholder applies for or consents to, approves or accepts the appointment of
a liquidator, trustee in bankruptcy, custodian, sequestrator, receiver, receiver
and manager or any other Person with similar powers for itself or all or
substantially all of its assets or properties; or

 
9.3.6  
a seizure or execution or any similar process, other than pursuant to a Security
Interest, whether or not permitted, contemplated or acknowledged under this
Agreement, is levied or enforced upon or against the Shares of such Shareholder
and the same remains unsatisfied for the shorter of a period of ninety (90) days
or such period as would permit the same to be sold, unless the Shareholder is,
within ten (days) and in good faith, disputing such process; or

 
9.3.7  
any Shares are Transferred (including, for greater certainty, the granting of a
Security Interest), except in compliance with the provisions of this Agreement;
or

 
9.3.8  
if any Shareholder's Absolutely Controlled Affiliate, the Ultimate Parent of a
Shareholder or any Absolutely Controlled Affiliate thereof would be in default
under the provisions of Sections 9.3.1 through 9.3.7 assuming it were a party
hereto, mutatis mutandis.

 
10.  
CONFIDENTIALITY

 
10.1  
Confidentiality.  Each Shareholder hereby agrees that it shall use Confidential
Information only for the purposes of fulfilling its obligations hereunder and
that it shall not, except as required by applicable Law in the opinion of such
Shareholder's counsel, directly or indirectly, disclose, divulge, reveal,
report, publish, transfer or use any Confidential Information for any other
purpose whatsoever; provided that this shall not prevent a Shareholder from
disclosing Confidential Information to its Affiliated Persons, advisors,
accountants, attorneys and, subject to the provisions of Section 5, bona fide
lenders, provided that in any such case the Person to whom Confidential
Information is disclosed is advised of the proprietary nature of the
Confidential Information and the restrictions contained in this Section 10.1,
and the disclosing Shareholder shall be responsible for any breach of this
Section 10.1 by such Person. For the purposes of this Agreement, the term
"Confidential Information" shall mean all data or information whatsoever
concerning the Partnership, the Company, and their respective Affiliated
Persons, Controlled Affiliated Persons and their respective businesses, which is
non-public, confidential or proprietary in nature in whatever form or manner
provided, whether or not reduced to writing, whether tangible or intangible,
together with analyses, compilations, forecasts, studies or other documents or
records that contain or are based on such information or data prepared by the
Partnership, a partner of the Partnership, the Company, a Shareholder or any
other Person at the Partnership's, the partner of the Partnership, the Company's
or the Shareholder's request, disclosed by one Person to another, including
(i) financial statements and other financial and operating information,
(ii) processes, intellectual property, methods, techniques and arrangements
relating to such businesses and activities and the manner in which the
Partnership, the partner of the Partnership, the Company, the Shareholders and
their Controlled Affiliated Persons do business, (iii) any other materials or
information that is not generally known to others engaged in similar businesses
or activities, and (iv) all information that contains, is derived from or
relates to any of the above enumerated materials and information.
Notwithstanding the foregoing, each Shareholder may disclose (subject to
applicable Laws) Confidential Information if (a) any such Confidential
Information is or becomes generally available to the public other than as a
result of disclosure by a Shareholder (or any of its Affiliated Persons) that
does not own such Confidential Information, (b) any such Confidential
Information (including any report, statement, testimony or other submission to a
governmental authority) is required to be disclosed by applicable Laws,
including but not limited to applicable securities laws, applicable tax laws and
accounting regulations, after prior notice has been given to the other
Shareholder to the extent such notice is permitted by applicable Law, provided
that no such notice is required if prohibited by applicable Law, (c) any such
Confidential Information is reasonably necessary to be disclosed in connection
with any dispute with respect to this Agreement or the Amended and Restated
Limited Partnership Agreement (including in response to any summons, subpoena or
other legal process or formal or informal investigative demand issued to the
disclosing Shareholder in the course of any litigation, arbitration, mediation,
investigation or administrative proceeding), (d) any such Confidential
Information was or becomes available to a Shareholder on a non-confidential
basis and from a source (other than the other Shareholder or any Affiliated
Person or representative of such Shareholder) that is not bound by a
confidentiality agreement with respect to such information or (e) any such
Confidential Information that was previously or is after the date hereof
independently developed without the aid, application or use of any information
that is to be kept confidential under this Section 10 is evidenced by a written
record proving such independent development.  For the purposes of this
Section 10, "Affiliated Persons" shall include, with respect to DCC GP Co, Dow
Chemical Company and Corning Incorporated and, with respect to BSI, AMG.  The
provisions of this Section 10.1 shall not otherwise affect any rights granted
pursuant to any other agreement.

 
11.  
INDEMNIFICATION

 
11.1  
General Indemnity.  Subject to the limitations contained in the Act, the Company
shall indemnify each director and officer of the Company, each former director
and officer of the Company and each individual who acts or acted at the
Company's request as a director or officer of a body corporate of which the
Company is or was a shareholder or creditor (or an individual who undertakes or
has undertaken any liability on behalf of the Company or any such body
corporate) and his or her heirs and legal representatives, against all costs,
charges and expenses, including an amount paid to settle an action or satisfy a
judgment, reasonably incurred by him or her in respect of any civil, criminal or
administrative action or proceeding to which he or she is made a party by reason
of being or having been a director or officer of the Company or such body
corporate, if: (i) he or she acted honestly and in good faith; and (ii) in the
case of a criminal or administrative action or proceeding that is enforced by a
monetary penalty, he or she had reasonable grounds for believing that his or her
conduct was lawful.

 
For greater certainty, any indemnity paid by the Company under this Section 11.1
shall not include the fees and expenses of legal counsels other than these of
the legal counsel retained by the Company to defend the claim against all such
Persons.
 
11.2  
Advance by the Company.  To the fullest extent permitted by law, expenses
(including legal fees and expenses other than these mentioned in the second
paragraph of Section 11.1) incurred by an indemnitee in defending any claim,
demand, action, suit or proceeding shall, in the circumstances of any claim,
demand, action, suit or proceeding made against all directors and officers of
the Company (including, where the context so requires or permits, former
director(s) and officer(s) of the Company and an individual who acts or acted at
the Company's request as a director or officer of a body corporate of which the
Company is or was a shareholder or creditor (or an individual who undertakes or
has undertaken any liability on behalf of the Company)) and his or her heirs and
legal representatives, from time to time, be advanced by the Company prior to
the final disposition of such claim, demand, action, suit or proceeding upon
receipt by the Company of an undertaking by or on behalf of the indemnitee to
repay such amount if it shall be determined that the indemnitee is not entitled
to be indemnified as authorized in Section 11.1.

 
12.  
DISPUTE RESOLUTION

 
12.1  
Amicable Resolution.  The Shareholders mutually desire that friendly
collaboration will continue among them with respect to the relationship created
by this Agreement and the Amended and Restated Limited Partnership
Agreement.  Accordingly, they will try, and they will cause their respective
Affiliates to try, to resolve in an amicable manner all disagreements and
misunderstandings connected with their respective rights and obligations under
this Agreement and the Amended and Restated Limited Partnership Agreement,
including any amendments hereto and thereto.  In furtherance thereof, in the
event of any dispute or disagreement between the Shareholders or their
affiliates, as to the interpretation of any provision of this Agreement or the
Amended and Restated Limited Partnership Agreement or any other agreements
related hereto or thereto or arising out of the transactions contemplated hereby
or thereby, or the performance of obligations hereunder or thereunder, including
for the purposes of an inability to obtain a Special Majority of the Board when
required, other than disputes with respect to any determination of book value,
fair market value or Valuation Price pursuant to the Amended and Restated
Limited Partnership Agreement, which shall be resolved in the manner set forth
in Section 21.4 thereof (each a "Dispute"), then unless otherwise expressly
provided in such other agreement related hereto (it being understood that
Disputes under the Supply Agreement and the Framework Agreement shall be
resolved in accordance with the terms thereof), upon written request of either
party, the matter will be referred for resolution to the Operating
Committee.  The Operating Committee will make a good faith effort to promptly
resolve all Disputes referred to it.  Operating Committee decisions will be
unanimous and will be binding on the Company.  If the Operating Committee does
not agree to a resolution of a Dispute within thirty (30) days after the
reference of the matter to it, the Dispute will be referred to a senior officer
of each Shareholder (as so designated by each Shareholder).  If the specified
senior officers of the Shareholders do not agree to a resolution of the Dispute
within thirty (30) days after the reference of the matter to them, then the
parties will be free to exercise the remedies available to them under applicable
Law, subject to Sections 12.2 and 12.3.

 
12.2  
Mediation.  In the event any Dispute (other than a Dispute relating to
Section 7.8) cannot be resolved in an amicable manner as set forth in
Section 112.1, the Shareholders intend that such Dispute be resolved by
mediation.  If the Operating Committee and the applicable senior officers of
each Shareholder are unable to resolve the Dispute as contemplated by
Section 12.1, any of the Shareholders may demand mediation of the Dispute by
written notice to the other in which case the parties will select a mediator
within ten (10) days after the demand.  The mediator shall be a single qualified
mediator experienced in the matters at issue, such mediator to be mutually
agreed upon by the Shareholders.  Neither party may unreasonably withhold
consent to the selection of the mediator.  Each Shareholder will bear its own
costs of mediation but both parties will share the costs of the mediator
equally.

 
12.3  
Arbitration.

 
12.3.1  
In the event that the Dispute is not resolved in accordance with Section 12.1 or
12.2, either party involved in the Dispute may submit the Dispute to binding
arbitration pursuant to this Section 12.3; provided that no Dispute arising out
of the failure to obtain a Special Majority of the Board pursuant to Section 7.8
shall be eligible for or submitted to binding arbitration pursuant to this
Section 12.3.  All Disputes submitted to arbitration pursuant to this
Section 12.3 shall be resolved in accordance with the Commercial Arbitration
Rules (the "Rules") of the American Arbitration Association (the "AAA").  All
cost and expenses incurred by the arbitrators shall be shared equally by the
applicable parties and each party shall bear its own costs and expenses in
connection with any such arbitration proceeding.

 
12.3.2  
In any Dispute submitted to binding arbitration pursuant to this Section 12.3,
there shall be three (3) arbitrators: (i) one (1) appointed by BSI, (ii) one (1)
appointed by DCC GP Co and (iii) one (1) appointed by the two (2) arbitrators
appointed by the Shareholders.  Each party to a Dispute shall choose an
arbitrator within thirty (30) days of receipt by a party of the demand for
arbitration.  If any party fails to appoint an arbitrator within the time
periods specified herein or if the two arbitrators appointed by the Shareholders
are unable to agree upon a third, such arbitrator shall, at any party's request,
be appointed by the AAA, pursuant to a listing, ranking and striking procedure
in accordance with the Rules.  Any arbitrator appointed by the AAA shall have no
less than fifteen (15) years of experience with large, complex commercial cases,
and shall be an experienced arbitrator.

 
12.3.3  
The language of the arbitration shall be English.  The place of arbitration
shall be New York, New York.  Except as set forth in this Section 12, the
parties agree that arbitration shall be their exclusive remedy with respect to
Disputes.  In addition to the authority conferred on the arbitral tribunal by
the Rules, the arbitral tribunal shall have the authority to order such
production of documents and such depositions of witnesses as may reasonably be
requested by either party or by the arbitral tribunal itself.  The award
rendered in any arbitration commenced hereunder shall be final and binding upon
the applicable parties and judgment thereon may be entered in any court of
competent jurisdiction.  By agreeing to arbitration, the parties do not intend
to deprive any court of its jurisdiction to issue a pre-arbitral injunction,
pre-arbitral attachment, or other order in aid of arbitration proceedings and/or
the enforcement of any award.  Without prejudice to such provisional remedies as
may be available under the jurisdiction of a court, the arbitral tribunal shall
have full authority to grant provisional remedies and to direct the applicable
parties to request that any court modify or vacate any temporary or preliminary
relief issued by such court, and to award damages for the failure of any
applicable party to respect the arbitral tribunal's orders to that effect.  Any
arbitration hereunder shall be confidential and all information about the
arbitration or the substance of the proceedings thereunder shall be treated as
Confidential Information pursuant to Section 10 hereof.

 
12.4  
Non-Exclusive Remedy.  The Shareholders acknowledge and agree that money damages
would not necessarily be a sufficient remedy for any breach of this Agreement or
the Amended and Restated Limited Partnership Agreement by the Shareholders or
any of their affiliates.  Accordingly, nothing in this Agreement will prevent
the Shareholders from seeking injunctive or similar relief in the event: (i) any
delay resulting from efforts to resolve such Dispute pursuant to Section 12.2
and Section 12.3 could result in serious and irreparable injury to either party;
or (ii) of any actual or threatened breach of any provisions of this Agreement
or the Amended and Restated Limited Partnership Agreement.  All actions for such
injunctive or interim relief shall be brought in a court of competent
jurisdiction in accordance with this Agreement.  Such remedy shall not be deemed
to be the exclusive remedy for breach of this Agreement or the Amended and
Restated Limited Partnership Agreement.

 
12.5  
Enforcement by Shareholders.  Notwithstanding anything to the contrary in this
Agreement, the Amended or Restated Limited Partnership Agreement or the Supply
Agreement, each Shareholder shall have the right, but not the obligation, to
enforce this Agreement, the Amended or Restated Limited Partnership Agreement
and the Supply Agreement on behalf of the Company with respect to the
obligations of the other Shareholder and its affiliates hereunder and
thereunder.

 
13.  
GENERAL

 
13.1  
Conflicts.  Should any provision of this Agreement conflict with any article or
any by-law of the Company, the provisions of this Agreement shall prevail. The
Parties agree to be bound by the terms of the Amended and Restated Limited
Partnership Agreement that shall relate to them as shareholders of the Company.

 
13.2  
No Waiver.  No consent or waiver, expressed or implied, by any Party of any
breach or default by any Party in the performance of its obligations hereunder
shall be deemed or construed to be a consent to or waiver of any other breach or
default in the performance by such other Party of the same or any other
obligations of such Party. Failure on the part of any Party to complain of any
act or failure to act of any other Party or to declare the other Party in
default, irrespective of how long such failure continues, shall not constitute a
waiver by the first mentioned Party of its rights hereunder.

 
13.3  
Notices.  Any notice, request, demand or other communication given or made
pursuant to this Agreement shall be in writing and delivered to the addresses
below, and shall be deemed to have been duly given or made as follows: (i) if
sent by registered or certified mail, postage and fees prepaid, on the fifth
(5th) Business Day after same was deposited with the post office; (ii) if sent
by reputable overnight courier, when delivered; (iii) if sent by facsimile
transmission or by any other written form of electronic communication, return
receipt requested, the Business Day next following receipt; or (iv) if otherwise
actually personally delivered, when delivered.  Any Party may change its address
for service from time to time by notice given to the other Parties in accordance
with the above.

 
if to BSI, to:
 
Bécancour Silicon Inc.
c/o Timminco Limited
Sun Life Financial Tower
150 King Street West
Suite 2401
Toronto ON M5H 1J9
Attention:                      General Counsel and Corporate Secretary
Fax:                      (416) 364-3451
E-mail:                      pkalins@timminco.com
 
a copy (which shall not constitute notice) to:
 
Stikeman Elliott LLP
5300 Commerce Court West
199 Bay Street
Toronto, ON M5L 1B9
Attention:                      Jay C. Kellerman
Fax:                      (416) 947-0866
E-mail:                      jkellerman@stikeman.com
 
if to DCC GP Co, to:
 
c/o Dow Corning Corporation
2200 W. Salzburg Road
Midland, Michigan 48686-0994
Attention:                      Sue K. McDonnell
Senior Vice President, General Counsel & Secretary
Fax:                      (989) 496-8307
E-mail:                      sue.mcdonnell@dowcorning.com
 
with a copy (which shall not constitute notice) to:
 
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York  10036
Attention:                      David J. Friedman
Fax:                      212-735-2000
E-mail:                      David.Friedman@skadden.com
 
if to GP, to:
 
Québec Silicon General Partner Inc.
c/o Bécancour Silicon Inc.
c/o Timminco Limited
Sun Life Financial Tower
150 King Street West
Suite 2401
Toronto ON M5H 1J9
Attention:                      General Counsel and Corporate Secretary
Fax:                      (416) 364-3451
E-mail:                                pkalins@timminco.com
 
with a copy (which shall not constitute notice) to DCC GP Co together with a
copy to the legal advisor of DCC GP Co and the legal advisor of BSI.
 
13.4  
Preamble.  The preamble forms an integral part of this Agreement.

 
13.5  
Entire Agreement.  The Parties agree that this Agreement and the Amended and
Restated Limited Partnership Agreement constitute the complete and exclusive
statement of the agreements between them with respect to their relationship as
Shareholders in the Company. This Agreement supersedes all prior negotiations,
agreements and communications, written or oral between the Shareholders,
including their Affiliates, with respect to their relationship as shareholders
in the Company.

 
13.6  
Sections and Headings.  The division of this Agreement into articles and
sections and the insertion of headings in this Agreement are for convenience of
reference only and shall not affect the construction or interpretation of this
Agreement.

 
13.7  
Amendment.  No amendments, changes or modifications to this Agreement shall be
valid except if the same are in writing and signed by a duly authorized
representative of each of the Parties.

 
13.8  
Severability.  If any of the provisions contained in this Agreement are found by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect, the validity, legality or enforceability of the remaining provisions
contained herein shall not be in any way affected or impaired thereby. In
addition, if any provision of this Agreement is found by a court of competent
jurisdiction to be invalid, illegal or unenforceable in any respect, the
Shareholders shall negotiate in good faith appropriate modifications to this
Agreement to replace the invalid, illegal or unenforceable provision by a valid,
legal and enforceable provision the effect and purpose of which is as close as
possible to the intended effect and purpose of the invalid, illegal or
unenforceable provision.

 
13.9  
Currency.  Except as otherwise explicitly provided in this Agreement, all dollar
amounts referred to in this Agreement are stated in the lawful currency of
Canada.

 
13.10  
Number and Gender.  Words in the singular include the plural and vice versa and
words in one gender include all genders.

 
13.11  
Successors and Assigns.  This Agreement shall enure to the benefit of and be
binding upon the Parties and their personal representatives, successors and
permitted assigns and any reference to a right or an obligation of a Party shall
be deemed to include a reference to such personal representatives, successors
and permitted assigns to the extent that the context requires.

 
13.12  
Governing Law.  This Agreement and the rights, obligations and relations of the
Parties shall be governed and construed in accordance with the laws of the
Province of Québec and the federal laws of Canada applicable therein.

 
13.13  
Jurisdiction.  The Parties agree to submit to the jurisdiction of the courts of
the Province of Québec (within the judicial district of Montreal) with respect
to all matters that relate to this Agreement.

 
13.14  
Counterparts.  This Agreement and any amendment, supplement, restatement or
termination of this Agreement in whole or in part may be signed and delivered in
any number of counterparts (including facsimile counterparts), each of which
when signed and delivered is an original but all of which taken together
constitute one and the same instrument.

 
13.15  
Other Documents.  Each Shareholder agrees to sign all such documents and do all
such things as may be necessary or desirable to more completely and effectively
carry out the terms and intentions of this Agreement and to cause the Company to
act in the manner contemplated by this Agreement and the Amended and Restated
Limited Partnership Agreement.

 
13.16  
Voting.  Each Shareholder agrees to vote its respective shares in the share
capital of the Company so that the decisions, acts, resolutions, things, by-laws
or other documents of the Company be in conformity with the provisions of this
Agreement.

 
13.17  
Legend on Certificates.  The certificate for shares issued or to be issued by
the Company shall bear the following legend:

 
"The transfer of the shares represented by this certificate is subject to the
provisions of and restrictions on transfer set forth in the articles of the
Company and the Shareholders Agreement dated as of October 1, 2010."
 
(signature page follows)
 

 
 

 

 
 
 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT ON THE DAY
FIRST WRITTEN ABOVE.
 
BÉCANCOUR SILICON INC.
 
Per:           /s/ Peter Kalins_________________________
duly authorized
Name:                      Peter Kalins
 
Title:
General Counsel and Corporate Secretary

 
QUÉBEC SILICON GENERAL PARTNER INC.
 
Per:           /s/ Peter Kalins _________________________
duly authorized
Name:                      Peter Kalins
 
Title:
General Counsel and Corporate Secretary

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(signature page to the Shareholders Agreement)
 

 

 
 
 

--------------------------------------------------------------------------------

 

 
 
 
DOW CORNING NETHERLANDS, B.V.
 
Per:           /s/ B. Anderson_________________________
duly authorized
 
Name: B. Anderson
 
Title: Managing Director B
 
Per:           /s/ Brian B. Tessin_______________________
duly authorized
 
Name: Brian B. Tessin
 
Title: Director - Class A
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(signature page to the Shareholders Agreement)
 

 

 
 
 

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SCHEDULE 7.4
 
INITIAL REPRESENTATIVES
 
SHAREHOLDER
REPRESENTATIVES
BSI
John Fenger
Robert J. Dietrich
Peter A. M. Kalins
DCC GP CO
David R. Soldan
Andrew E. Tometich

 
 

 

 
 
 

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SCHEDULE 7.9
 
INITIAL OPERATING COMMITTEE MEMBERS
 
 
John Fenger
Millicent Poon
William E. Boardwine
Paul J. Marion