Exhibit 10.23

Cabot Microelectronics Corporation
 
AMENDED AND RESTATED CHANGE IN CONTROL
 
SEVERANCE PROTECTION AGREEMENT
 
This Amended and Restated Agreement, (the “Agreement”) is entered into effective
as of ____________, 2008 (the “Agreement Date”), by and between Cabot
Microelectronics Corporation, a Delaware corporation (the “Company”) and
[Executive] (the “Executive”);
 
Witnesseth That:
 
Whereas, the Executive is employed by the Company, and the Company desires to
provide protection to the Executive in the event of a Change in Control of the
Company;
 
Whereas, the Executive and the Company desire to amend and restate the Change in
Control Severance Protection Agreement between the Company and the Executive,
dated as of _______, ____ (the “Original Agreement”), in order to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
to make certain other clarifications to ensure that the intended benefits of the
Original Agreement are provided to the Executive;
 
Now, Therefore, it is hereby agreed by and between the parties, for good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, as follows:
 
Article I. Establishment and Purpose
 
1.1 Purpose of the Agreement.  The purpose of this Agreement is to advance the
interests of the Company by providing the Executive with an assurance of
equitable treatment, in terms of compensation and economic security, in the
event of an acquisition or other Change in Control of the Company.  An assurance
of equitable treatment will enable the Executive to maintain productivity and
focus during the period of significant uncertainty that is inherent in an
acquisition or other Change in Control.  Further, the Company believes that
agreements of this kind will aid it in attracting and retaining the highly
qualified, high-performing professionals who are essential to its success.
 
Article II. Certain Definitions
 
2.1 “Affiliate” is any entity directly or indirectly controlled by, controlling
or under common control with the Company.
 
2.2 “Cause” means either:
 
(a) the Executive’s willful and continued failure to perform substantially the
duties reasonably assigned to the Executive; or
 
(b) the Executive’s willful engaging in conduct that is demonstrably and
materially injurious to the Company, monetarily or otherwise.
 
The Executive’s willful failure to perform substantially his or her duties shall
constitute “Cause” only if the Applicable Board (as defined in Section 5.2) has
delivered a written demand for substantial performance to the Executive that
specifically identifies the manner in which the Applicable Board believes the
Executive has failed to perform, and has otherwise followed the procedure
described in Section 5.2 below.  The Executive’s failure to perform
substantially his or her assigned duties does not include either a failure that
results from the Executive’s death, Disability, physical or mental incapacity,
or an anticipated failure following the Executive’s notifying the Company that
he or she intends to resign for Good Reason or during the One-Year Window
Period.  No act or failure to act of the Executive’s will be deemed “willful” if
the Executive acted (or failed to act) in good faith or in the reasonable belief
that his or her act or omission was in the best interests of the Company.
 
2.3 “Change in Control” means the first to occur of any of the events or
conditions described in subsections (a) through (e):
 
(a) Any Person, together with all affiliates and associates (within the meaning
of Rule 12b-2 promulgated under the Exchange Act), acquires Beneficial
Ownership, directly or indirectly, or securities of the Company representing at
least thirty percent (30%) of the combined voting power of the Company’s then
outstanding Voting Securities.  Notwithstanding the foregoing, the acquisition
of Voting Securities in a Non-Control Acquisition will not constitute a Change
in Control.
 
(b) During any period of twenty-four (24) consecutive months beginning on or
after the Agreement Date, individuals who, at the beginning of that 24-month
period, constitute the Board (the “Incumbent Directors”), cease for any reason
to constitute at least a majority of the Board.  A new director of the Company
whose election or nomination for election as a director of the Company was
approved by a vote of at least two-thirds of the Incumbent Directors will be
deemed to be an Incumbent Director.  Notwithstanding the foregoing, (i) a new
director designated by a person who has entered into an agreement with the
Company to effect a transaction described in Section 2.3(d) will not be deemed
to be an Incumbent  Director and (ii) no individual will be considered to be an
Incumbent Director if he or she initially assumed office through an actual or
threatened “Election Contest” with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a Person other than the Board (a “Proxy Contest”), including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest.
 
 
 
1

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

 
 
(c) At any duly conducted election of directors at a special or annual meeting
of the Company’s stockholders,
 
(i)  
two or more nominees who are both (A) nominees of and endorsed by the Company
and (B) not employees of the Company or any Affiliate at the time of the
election are not elected to serve as directors; and

 
(ii)  
any person not a nominee of, and endorsed by, the Company is elected to serve as
a director of the Company.

 
(d) The consummation of:
 
(i)  
a merger, consolidation or reorganization involving the Company, unless the
merger, consolidation or reorganization is a “Non-Control Transaction;” or

 
(ii)  
a transaction pursuant to which all or substantially all of the assets of the
Company are sold or disposed of to any Person (other than a transfer to a Change
in Control Subsidiary).

 
(e) Approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company; or
 
(f) This Section 2.3(f) contains the definitions of the capitalized terms used
in subsections (a) through (e) above.
 
(i)  
“Voting Securities” are securities of the Company generally entitled to vote in
the election of directors.

 
(ii)  
“Person” is used under this Agreement in the same way as under Section 13(d) and
14(d) of the Exchange Act.

 
(iii)  
“Beneficial Ownership” is used in the same way as under Rule 13d-3 promulgated
under the Exchange Act.

 
(iv)  
A “Non-Control Acquisition” is an acquisition (A) by an employee benefit plan
maintained by the Company or by a Change in Control Subsidiary; (B) by the
Company or by a Change in Control Subsidiary; or (C) directly from the Company
(1) by an underwriter in connection with an underwritten public offering or
private placement, (2) of non-voting convertible debt or non-voting convertible
preferred stock (until converted into Voting Securities), or (3) by a Person
who, in connection with the acquisition, (a) enters into a standstill agreement
with the Company that has a duration of at least two years and pursuant to which
the Person agrees to vote the acquired securities on any matter either at the
direction of the Board or in the same proportion as the Company’s other
stockholders vote on the matter and (b) agrees to assume, honor and perform the
Company’s obligations under this Agreement.  An acquisition pursuant to
sub-clause (C)(3) will be a Non-Control Acquisition only for so long as the
standstill agreement remains in effect.

 
(v)  
“Board” means the Board of Directors of the Company.

 
(vi)  
A “Change in Control Subsidiary” is a corporation or other Person, a majority of
whose voting power, voting equity securities or equity interest is owned
directly or indirectly by the Company.

 
(vii)  
A “Non-Control Transaction” is a merger, consolidation or reorganization of the
Company where (A) the stockholders of the Company, immediately before the
merger, consolidation or reorganization, own directly or indirectly immediately
after the merger, consolidation or reorganization, at least sixty percent (60%)
of the combined voting power of the outstanding voting securities of the
corporation resulting from the merger, consolidation or reorganization (the
“Surviving Corporation”) in substantially the same proportion as their ownership
of the Voting Securities immediately before the merger, consolidation or
reorganization; (B) the individuals who were Incumbent Directors immediately
before the agreement providing for the merger, consolidation or reorganization
was executed constitute at least two-thirds of the members of the board of
directors of the Surviving Corporation; and (C) no Person other than (1) the
Company, (2) a Change in Control Subsidiary, or (3) an employee benefit plan
maintained by the Company, the Surviving Corporation or a Change in Control
Subsidiary, acquires Beneficial Ownership of thirty percent (30%) or more of the
combined voting power of the Surviving Corporation’s then outstanding voting
securities.

 
Notwithstanding the foregoing, a Change in Control will not be deemed to occur
solely because a Person acquires Beneficial Ownership of more than the permitted
amount of the then outstanding Voting Securities as a result of the acquisition
of Voting Securities by the Company which, by reducing the number of Voting
Securities then outstanding, increases the percentage of shares Beneficially
Owned by the Person.  Notwithstanding the foregoing, if a Change in Control
would occur but for the operation of the preceding sentence as a result of the
acquisition of Voting Securities by the Company, and after that acquisition by
the Company, the Person described in the preceding sentence increases the
percentage of then outstanding Voting Securities he or she owns, a Change in
Control will occur.
 
 
 
2

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

 
 
2.4 “Change in Control Period” means the period commencing on the Agreement Date
and ending on the earliest to occur of the date that is (a) the first
anniversary of the date as of which the Company or Committee notifies the
Executive in writing that the Agreement is being terminated or (b) other than
with respect to an Anticipatory Termination (as defined in Section 2.6), the
date on which the Company and its Affiliates cease to employ the Executive, if
such cessation occurs prior to a Change in Control.
 
2.5  “Disability” is a physical or mental condition that would entitle the
Executive to benefits under the Company’s long-term disability plan, or if the
Company maintains no such plan, then under the federal Social Security law.
 
2.6 “Effective Date” means the first date during the Change in Control Period on
which a Change in Control occurs.  Notwithstanding anything in this Agreement to
the contrary, if a Change in Control occurs and if the Executive’s employment
with the Company is terminated during the one-year period prior to the date on
which the Change in Control occurs, and if it is reasonably demonstrated by the
Executive that such termination of employment (a) was at the request of a third
party that has taken steps reasonably calculated to effect a Change in Control
or (b) otherwise arose in connection with or anticipation of a Change in
Control, then “Effective Date” means the date immediately prior to the date of
such termination of employment (an “Anticipatory Termination”).  In the event of
an Anticipatory Termination, the Severance Benefits will be paid or provided as
set forth in Section 4.2 and for purposes thereof the “Termination Date” shall
be the date of the Change in Control.
 
2.7 “Good Reason” means the taking of actions by the Company that result in a
material negative change in the Executive’s employment relationship.  For these
purposes, a “material negative change in the Executive’s employment
relationship” includes any of the events or conditions described below:
 
(i)  
There is a change in the Executive’s status, title, position or responsibilities
(including reporting responsibilities and, if applicable, membership on the
Board) which represents a material adverse change from those in effect as of
immediately prior to the Change in Control;

 
(ii)  
The Executive is assigned duties or responsibilities that are materially
inconsistent with the Executive’s status, title, position or responsibilities as
of immediately prior to the Change in Control;

 
(iii)  
A material decrease in the Executive’s annual base salary from the rate in
effect as of the date of the Change in Control or as of any date following the
Change in Control, whichever is greater;

 
(iv)  
The offices of the Company or Operating Unit at which the Executive is
principally employed are moved to a location that increases the Executive’s
one-way commute by more than thirty-five (35) miles from the location of the
offices occupied immediately prior to such relocation; or

 
(v)  
Any other action or inaction that constitutes a material breach by the Company
of this Agreement.

 
2.8 “One-Year Window Period” is the thirty (30)-day period commencing on the
date of the first anniversary of a Change in Control.
 
Article III. Employment Period
 
The Company hereby agrees to continue the Executive in its employ, subject to
the terms and conditions of this Agreement, for the period commencing on the
Effective Date and ending on the day after the date that is thirteen months
following the Effective Date (the “Employment Period”).  The Employment Period
shall terminate upon the Executive’s termination of employment for any
reason.  During the Employment Period, the Executive’s annual base salary shall
be at least equal to the Executive’s annual base salary as in effect immediately
prior to the Effective Date and the Executive shall be eligible to participate
in compensation and benefit plans that are no less favorable than those in which
the Executive participated immediately prior to the Effective Date  and on terms
and conditions no less favorable (including as to the amount of benefits
provided and as to the level of the Executive’s participation) than those that
applied immediately prior to the Effective Date (or, if more favorable, those in
which similarly situated executives of the Company are eligible to participate
during the Employment Period).
 
 
 
3

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

 
 
Article IV. Severance Benefits
 
4.1 Right to Severance Benefit.  The Executive will be entitled to receive from
the Company the Severance Benefit provided in Section 4.2 if a Change in Control
occurs and, within the Employment Period, the Executive’s employment with the
Company and all of its Affiliates is (a) involuntarily terminated by the Company
for any reason other than the Executive’s death or Disability or for Cause or
(b) by the Executive (i) for Good Reason within the Employment Period (or due to
an Anticipatory Termination) or (ii) during the One-Year Window Period.  Other
than during the One-Year Window Period, if the Executive voluntarily terminates
employment at any time for any reason other than Good Reason (or due to an
Anticipatory Termination), the Executive will not be entitled to the Severance
Benefit.
 
4.2 Severance Benefit.  The “Severance Benefit” to which the Executive will
become entitled if the Executive meets the requirements of Section 4.1 is
composed of all of the amounts and benefits described in subsections (a) through
(f) below, paid or provided as described in those subsections.
 
(a) The Company will pay the Executive all Accrued Compensation within ten (10)
days after the Termination Date (as defined below).  The Executive’s “Accrued
Compensation is all amounts earned or otherwise payable to the Executive as of
the Termination Date, including base salary, reimbursement for reasonable and
necessary expenses incurred by the Executive on behalf of the Company through
the Termination Date, vacation pay and earned and unpaid bonuses and incentive
compensation with respect to periods prior to the Termination Date; provided,
that notwithstanding the foregoing, if the Executive has made an irrevocable
election under any deferred compensation arrangement subject to Section 409A of
the Code to defer any portion of the annual base salary, bonuses or incentive
compensation described above then for all purposes of this Agreement, such
deferral election, and the terms of the applicable arrangement shall apply to
the same portion of such amounts, and such portions shall not be considered as
part of the “Accrued Compensation” but shall instead be considered as an “Other
Amount” (as defined below).
 
(b) The Company will pay the Executive a Pro-rata Bonus within thirty (30) days
after the Termination Date, subject to the proviso in Section 4.2(a) above.  The
Executive’s “Pro-rata Bonus” shall be the amount equal to the Executive’s Bonus
Amount (as defined below) multiplied by a fraction, the numerator of which is
the number of days that have elapsed through the Termination Date in the
Company’s then-current fiscal year and the denominator of which is 365.  For
purposes of this Agreement, the Executive’s “Bonus Amount” shall equal the
greatest of:
 
(i)  
the Executive’s target bonus amount for the fiscal year in which the Change in
Control occurs under the Short-Term Incentive Plans (as defined below) in which
the Executive is eligible to participate as of immediately prior to the Change
in Control;

 
(ii)  
the Executive’s target bonus amount for the fiscal year in which the Termination
Date occurs under all Short-Term Incentive Plans in which the Executive is
eligible to participate as of immediately prior to the Termination Date; and

 
(iii)  
the highest bonus amount paid or payable to the Executive under all Short-Term
Incentive Plans in respect of any of the three fiscal years preceding the fiscal
year in which the Change in Control occurs (or for such lesser number of full
fiscal years prior to the Change in Control for which the Executive was eligible
to earn such a bonus).

 
For purposes of determining the Bonus Amount, the bonus formulations set forth
in clauses (i) through (iii) above shall include any portion of a bonus that the
Executive elected to defer and any portion that is settled in equity awards and,
for any fiscal year consisting of less than 12 full months or during which the
Executive was employed for less than 12 full months and received a pro-rated
bonus, shall be annualized.

“Short-Term Incentive Plans” are any bonus or incentive compensation plans,
policies, programs or other arrangements that make cash awards to the Executive
on the basis of award periods that are no longer than one year.
 
(c) The Company will pay the Executive an amount equal to [for executive
officers other than the chief executive officer and principal accounting
officer: two (2)] [for the chief executive officer: three (3)][for the principal
accounting officer: one (1) time] times the sum of:  (i) the Executive’s annual
base salary, (ii) the Executive’s Bonus Amount and (iii) an amount equal to the
contributions made or credited by the Company under all qualified and
non-qualified retirement plans for the benefit of the Executive for the most
recently completed plan year of each such plan.  For purposes of this Agreement,
the Executive’s “annual base salary” includes any amounts the Executive may have
elected to defer, and will be calculated at the rate in effect immediately
before the Change in Control or on the Termination Date, whichever is
greater.  The Company will pay the amount described in this Section 4.2(c) in
one lump sum, without any discount for accelerated payment, within ten (10) days
after the Termination Date.
 
(d) For the [for executive officers other than the chief executive officer and
principal accounting officer: twenty-four (24)-month][for the chief executive
officer: thirty-six (36)-month][for the principal accounting officer: twelve
(12)-month] period beginning on the Termination Date (the “Benefits Continuation
Period”), the Company will continue on behalf of the Executive and his or her
dependents and beneficiaries, at the Company’s expense and without any required
contribution by the Executive medical, health, dental and prescription drug
benefits (the “Health Care Benefits”).
 
The Health Care Benefits (including deductibles, if any) provided under this
Section 4.2(d) will be no less favorable to the Executive and the Executive’s
beneficiaries than the most favorable of those coverages and benefits provided
to the Executive and the Executive’s dependents during the ninety-day (90-day)
period immediately before the earlier of the Executive’s Termination Date and
the Change in Control, or as of any date following the Change in Control but
preceding the Executive’s Termination Date (such period, the “Benefits
Measurement Period”); provided, however, that the Healthcare Benefits provided
during the Benefits Continuation Period shall be provided in such a manner that
such benefits (and the costs and premiums thereof) are excluded from the
Executive’s income for federal income tax purposes, and, if the Company
reasonably determines that providing continued coverage under one or more of its
welfare benefit plans contemplated herein could be taxable to the Executive, the
Company shall provide such benefits at the level required hereby through the
purchase of individual insurance coverage.  If the Executive obtains Health Care
Benefits under a subsequent employer’s benefit plans during the Benefits
Continuation Period, the Health Care Benefits provided hereunder shall be
secondary to those provided under such other plan during such applicable period
of eligibility.  In addition, the Company shall make a lump sum payment to the
Executive, without any discount for accelerated payment, within ten (10) days
after the Termination Date in an amount equal to the product of (i) the annual
premium payments based on the conversion rates applicable to the Executive as of
the Termination Date in respect of the group term life insurance policy and not
any supplemental policies under which the Executive was covered immediately
prior to the Date of Termination and (ii) [for executive officers other than the
chief executive officer and principal accounting officer: two (2)] [for the
chief executive officer: three (3)][for the principal accounting officer: one
(1)].  To the extent requested by the Executive within 30 days following the
Date of Termination, the Company shall take all action necessary, if any, to
facilitate the Executive’s exercise of all conversion privileges, if any, under
such group term life insurance policy.
 
 
 
4

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

 

 
(e) The Company shall, at its sole expense as incurred, provide the Executive
with outplacement assistance services the scope and provider of which shall be
selected by the Executive in the Executive’s sole discretion, provided that the
cost of such outplacement shall not exceed 15% of the Executive’s annual base
salary; and provided, further, that such outplacement benefits shall end not
later than the last day of the second calendar year that begins after the
Termination Date.
 
(f) All amounts earned by, or awarded to, the Executive under any incentive
compensation plan or benefit plan and not specifically described in Sections
4.2(a) through (e) above (the “Other Amounts”) will immediately vest on the
Executive’s Termination Date, and the Executive will be entitled to be paid such
Other Amounts in accordance with the terms of the plans.  In addition, all stock
options to acquire Company common stock, shares of restricted Company common
stock and any other equity-related awards granted to the Executive under the
Cabot Microelectronics Corporation 2000 Equity Incentive Plan or any successor
plan will immediately vest and become freely exercisable upon a Change in
Control, to the extent provided by the terms of that plan.  This Section 4.2(f)
will not apply to any benefits allocated or accrued to the Executive under any
plan that is intended to be qualified under Section 401(a) of the Code.
 
All payments described in this Section 4.2 are described gross of any
withholding, and will be subject to any applicable requirement to withhold
income, payroll or other taxes, except with respect to, and to the extent
provided as, a Gross-up Payment as provided in Article VI below.
 
4.3 No Obligation to Mitigate.  The Executive will not be required to mitigate
the amount of the Severance Benefit or any portion of it by seeking other
employment or otherwise.  Except as provided in Section 4.2(d), no portion of
the Severance Benefit will be offset or reduced by the amount of any
compensation or benefits provided to the Executive through subsequent
employment.
 
Article V. Termination of Employment
 
5.1 Termination Date.  The “Termination Date” is the date on which the
Executive’s employment with the Company and all Affiliates terminates, pursuant
to the provisions of this Article V.  The Company and the Executive shall take
all steps necessary (including with regard to any post-termination services by
the Executive) to ensure that any termination described in this Article V
constitutes a “separation from service” within the meaning of Section 409A of
the Code, and notwithstanding anything contained herein to the contrary, the
date on which such separation from service takes place shall be the “Termination
Date.”
 
5.2 Termination by Company for Cause.  At any time following a Change in Control
and during the Employment Period, the Company must follow the procedure set
forth in this Section 5.2, in order to terminate the Executive for
Cause.  First, the Board of Directors of the Company (or if the Company is not
the ultimate parent of the Company, the board of directors of the ultimate
parent of the Company (the “Applicable Board”)) shall hold a meeting to
determine whether Cause exists.  The Company must give the Executive reasonable
advance written notice of the meeting and of the facts and circumstances that
will be presented to the Applicable Board as constituting Cause, including facts
evidencing that the Executive has been given at least a thirty (30) day
opportunity within which to cure any facts and circumstances constituting Cause,
unless the facts and circumstances alleged to constitute Cause do not allow for
cure.  The Executive will have an opportunity, together with the Executive’s
counsel, to be heard by the Applicable Board before the meeting.  If the
Applicable Board finds, by a resolution duly adopted in good faith by
affirmative vote of at least three-quarters of the entire membership of the
Applicable Board, that Cause exists and that the Executive should be terminated
for Cause, then the Applicable Board must set forth those findings in a written
resolution that also includes the specific facts and circumstances found to
constitute Cause (which cannot include any facts or circumstances not included
in the written notice of the Applicable Board meeting given to the
Executive).  The Company must furnish the Executive with a copy of the
resolution, together with a written notice that the Executive is being
terminated for Cause.  The notice must specify the effective date of the
termination.  The effective date of the termination may not be sooner than five
(5) business days after the date the Company delivers the resolution and notice
to the Executive.  In any action to contest the existence of Cause, the
Applicable Board’s findings will have no presumptive weight.  The Company may
not later rely upon any facts or circumstances as Cause for the Executive’s
termination, other than the facts or circumstances set forth in the notice of
the Applicable Board meeting given to the Executive and found by the Applicable
Board at that meeting to constitute Cause.
 
5.3 Termination by Company for Disability.  At any time following a Change in
Control and during the Employment Period, the Company must follow the procedure
set forth in this Section 5.3, in order to terminate the Executive for
Disability.  If, as a result of Disability, the Executive has been absent from
the performance of his or her duties for the Company for the elimination period
provided in the Company’s long-term disability plan (or, if the Company does not
maintain a long-term disability plan, for six (6) consecutive months) and the
Executive is unable to return to his or her duties on a full-time basis, even
with reasonable accommodations on the Company’s part, the Company may give the
Executive written notice that it proposes to terminate the Executive’s
employment for Disability.  The notice will state that the Company will
terminate the Executive for Disability effective on a specific date, unless the
Executive returns to the performance of his or her duties on a full-time basis
by that date.  The effective date of the termination may not be sooner than
thirty (30) days after the date the Company delivers the notice to the
Executive.  The Executive will be terminated for Disability if and only if the
Company has made all reasonable accommodations required to permit the Executive
to return to work and the Executive has not returned on a full-time basis by the
date specified in the notice.  Notwithstanding any other provision of this
Section 5.3, if the Executive elects a disability retirement under any qualified
retirement plan of the Company, or begins to receive benefits under the
Company’s long-term disability plan, he or she will be deemed to have been
properly terminated for Disability by the Company.  The effective date of such a
termination will be the Executive’s retirement date under the retirement plan or
the date as of which long-term disability benefits begin under the Company’s
long-term disability plan, whichever is sooner.
 
5.4 Termination by Executive for Good Reason.  Following a Change in Control and
during the Employment Period, the Executive may terminate employment for Good
Reason.  In order to invoke a termination for Good Reason, the Executive shall
provide written notice to the Company of the existence of one or more of the
conditions described in clauses (i) through (vi) of Section 2.7 within ninety
(90) days following the initial existence of such condition or conditions, and,
to the extent such condition is curable, the Company shall have thirty (30) days
following receipt of such written notice (the “Cure Period”) during which it may
remedy the condition.  In the event that the Company fails to remedy the
condition constituting Good Reason during the Cure Period, the Executive must
terminate employment, if at all, within ninety (90) days following the Cure
Period in order to terminate employment for Good Reason.  The Executive’s mental
or physical incapacity following the occurrence of an event described above in
clauses (i) through (vi) of Section 2.7 shall not affect the Executive’s ability
to terminate employment for Good Reason.
 
 
 
5

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

 
 
5.5 Voluntary Termination by Executive during the One-Year Window Period.
Following a Change in Control and during the Employment Period, the Executive
may voluntarily terminate his or her employment with the Company and its
Affiliates for any or no reason during the One-Year Window Period without giving
prior notice to the Company, and will not be required to give any notice in
order to perfect his or her rights under this Agreement on termination during
the One-Year Window Period. The Executive will be deemed to voluntarily
terminate his or her employment with the Company and all Affiliates during the
One-Year Window Period only if the Executive actually terminates employment with
the Company and all Affiliates before the end of the One-Year Window Period.
 
5.6 Other Termination.  Neither the Company nor the Executive must follow any
particular procedures to effect a termination for a reason other than Cause,
Disability or Good Reason, or for the Executive to terminate employment
voluntarily at a time other than during the One-Year Window Period.
 
Article VI. Parachute Payments
 
6.1 Excise Tax Gross-up Payment.  Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any amounts or
benefits the Executive would receive , whether paid or provided under this
Agreement or otherwise (such amounts and benefits that are in the nature of
compensation (within the meaning of Section 280G(b)(2) of the Code), the
“Payments”), would subject the Executive to an excise tax under Section 4999 of
the Code (the “Excise Tax”), the Company will pay the Executive, in addition to
the Severance Benefit and any other payments or benefits to which the Executive
is entitled, a “Gross-up Payment.”  The Gross-up Payment will be in the amount
such that, after payment by the Executive of all taxes (and any interest or
penalties imposed with respect to such taxes), including, without limitation,
any income taxes (and any interest and penalties imposed with respect thereto)
and Excise Tax imposed upon the Gross-Up Payment, but excluding any income taxes
and penalties imposed pursuant to Section 409A of the Code, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.  The Company’s obligation to make a Gross-Up Payment under this
Section 6.1 shall not be conditioned upon the Executive’s termination of
employment and shall survive the Executive’s termination of employment.
 
6.2 Determination of Gross-up Payment.  A nationally recognized certified public
accounting firm or professional services firm with experience making such
determinations, as may be designated by the Company prior to the Change in
Control (the “Accounting Firm”), will make an initial determination of whether
the Company must pay a Gross-up Payment, and if so, the amounts of any such
Gross-up Payment.  The Accounting Firm will provide the Company and the
Executive with the determination and detailed supporting calculations and
documentation within 15 business days of the receipt of notice from the
Executive that there has been a Payment or such earlier time as is requested by
the Company.  The Company will pay the fees and expenses of the Accounting
Firm.  The Executive will have the right to accept the determination, or to have
the determination reviewed by a nationally recognized accounting firm selected
by the Executive, at the Executive’s expense.  The determination of the second
accounting firm will be binding, final and conclusive on the Company and the
Executive.  The Company will pay the Gross-up Payment finally determined under
this Section 6.2 within ten (10) days after it is finally determined or if
earlier the date that it is due to the Internal Revenue Service or any other
applicable taxing authority; provided that, the Gross-Up Payment shall in all
events be paid no later than the end of the Executive’s taxable year next
following the Executive’s taxable year in which the Excise Tax (and any income
or other related taxes or interest or penalties thereon) on a Payment are
remitted to the Internal Revenue Service or any other applicable taxing
authority.  The Gross-Up Payment shall be paid to the Executive; provided that
the Company, in its sole discretion, may withhold and pay over to the Internal
Revenue Service or any other applicable taxing authority, for the benefit of the
Executive, all or any portion of any Gross-Up Payment, and the Executive hereby
consents to such withholding.
 
Article VII. Other Rights and Benefits Not Affected
 
7.1 Other Benefits.  Except as otherwise specifically provided in this
Agreement, the provisions of this Agreement will not affect any other plan,
program or arrangement under which the Executive may accrue or earn benefits or
compensation.  Notwithstanding the foregoing, if the Executive receives a
Separation Benefit pursuant to Section 4.2 of this Agreement, the Executive
shall not be entitled to any severance pay or benefits under any severance plan,
program or policy of the Company and its Affiliates.
 
7.2 Employment Status.  This Agreement does not constitute a contract of
employment or impose on the Executive or the Company any obligation to retain
the Executive as an employee, to change the status of the Executive’s
employment, or to change the Company’s policies regarding termination of
employment.
 
Article VIII. Successors and Beneficiaries
 
8.1 Successors.  The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) of all or
substantially all of the business or assets of the Company expressly to assume
and agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such succession had taken
place.
 
This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, and legatees.  If the Executive
should die while any amount would still be payable to him hereunder had the
Executive continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement, to the Executive’s
devisee, legatee, or other designee, or if there is no such designee, to the
Executive’s estate.
 
 
 
6

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

 
 
8.2 Beneficiaries.  The Executive’s beneficiary under the Cabot Microelectronics
Corporation 401(k) Plan (or any successor plan (and if there is no such
successor plan the Executive’s beneficiary as noted on the records of the
Company)) will be the Executive’s beneficiary under this Agreement, unless the
Executive otherwise designates a beneficiary in the form of a signed writing
acceptable to the Committee.  The Executive may make or change such designation
at any time.
 
Article IX. Legal Fees and Arbitration
 
The Company will indemnify and reimburse the Executive for all legal fees and
related expenses (including the costs of experts, evidence and counsel, but not
including the costs of an accounting firm selected by the Executive to perform a
Gross-up Payment determination as provided in Section 6.2) (the “Legal
Expenses”) reasonably incurred by the Executive:
 
(a) to contest or dispute in good faith the Executive’s termination of
employment with the Company and its Affiliates; or
 
(b) to seek to obtain or enforce any benefit or right provided by this Agreement
or by any other plan or arrangement maintained by the Company or its Affiliates
and under which the Executive is or may be entitled to receive benefits upon or
following the Executive’s termination of employment or a Change in Control.
 
In either case, the Executive will be entitled to indemnification and
reimbursement of the Legal Expenses only if the termination of employment the
Executive contests or disputes, or as to which the Executive seeks benefits or
rights, arose in connection with a Change in Control or during the Employment
Period.  In order to comply with Section 409A of the Code, (i) the Legal
Expenses shall be reimbursed with respect to claims, actions or proceedings
incurred at any time from the occurrence of a Change in Control through the
Executive’s remaining lifetime (or, if longer, through the 20th anniversary of
the occurrence of such Change in Control), (ii) in no event shall the payments
by the Company under this Article IX be made later than the end of the calendar
year next following the calendar year in which the Legal Expenses were incurred,
provided that the Executive shall have submitted an invoice for such Legal
Expenses at least ten (10) business days before the end of the calendar year
next following the calendar year in which such Legal Expenses were incurred;
(iii) the amount of any Legal Expenses that the Company is obligated to pay in
any given calendar year shall not affect the Legal Expenses that the Company is
obligated to pay in any other calendar year; and (iv) the Executive’s right to
have the Company pay such Legal Expenses may not be liquidated or exchanged for
any other benefit.
 
Article X. Amendment, Modification, Termination and Substitution
 
10.1 Amendment, Modification, Termination and Substitution.  Subject to Sections
10.2 and 10.3, the Board may at any time and from time to time alter, amend,
modify, extend or terminate this Agreement, or accept its surrender and execute
a new agreement in substitution of it, by resolution or consent adopted by
two-thirds of the Board.  Notwithstanding the foregoing, no modification or
substitution of this Agreement will, without the prior written consent of the
Executive, alter or impair any rights or obligations under this Agreement.  The
Executive must be given a copy of any instrument that purports to alter, amend,
modify, extend or terminate this Agreement.
 
10.2 Limitations on Amendment, Modification, Termination and Substitution.  No
amendment, termination, modification, extension or substitution of this
Agreement will be effective if it would adversely affect the rights of the
Executive, if a Change in Control occurs within one year after the date it is
meant to be effective (or, if earlier, if a Change in Control occurs after the
Executive’s Anticipatory Termination), and any such an amendment, termination,
modification or substitution will be automatically rescinded, unless the
rescission of any such amendment, termination, modification or substitution
would result in adverse tax consequences to the Executive.  .  In addition, this
Agreement may not be amended, modified, terminated, extended or substituted at
the request of a third party who has indicated an intent, or taken steps to
effect, a Change in Control, or otherwise in connection with or anticipation of
a Change in Control.  From and after the occurrence of a Change in Control, this
Agreement may not be amended, modified, terminated, extended or substituted in a
manner that would in any way adversely affect the benefits or rights provided to
the Executive.
 
10.3 Section 409A of the Code.  The payments and benefits under this Agreement
are intended to be exempt from Code Section 409A pursuant to the exception for
short-term deferrals, reimbursements, and in-kind distributions.  This Agreement
shall be construed, interpreted and administered in accordance with such
intent.  Notwithstanding the foregoing, the Executive and the Company
acknowledge that it may be necessary to amend this Agreement, within the time
period permitted by the applicable Treasury Regulations, to make changes so as
to cause such payments and benefits not to be considered “deferred compensation”
for purposes of Section 409A of the Code, to cause the provisions of this
Agreement to comply with the requirements of Section 409A of the Code, or a
combination thereof, so as to avoid the imposition of  taxes and penalties on
the Executive pursuant to Section 409A of the Code.  The Executive hereby agrees
that, prior to a Change in Control, the Company may, without any further consent
from the Executive, make any and all such changes to this Agreement as may be
necessary or appropriate to avoid the imposition of penalties on the Executive
pursuant to Section 409A of the Code, while not substantially reducing the
aggregate value to the Executive of the payments and benefits to, or otherwise
adversely affecting the rights of, the Executive under this Agreement.  Each
payment under this Agreement shall be treated as a separate payment for purposes
of Section 409A of the Code.  In no event may the Executive, directly or
indirectly, designate the calendar year of any payment to be made under this
Agreement.  All reimbursements and in-kind benefits provided under this
Agreement shall be made or provided in accordance with the requirements of
Section 409A of the Code and (i) shall be paid or provided within the time
period permitted under Section 409A of the Code, (ii) the amount or benefit that
the Company is obligated to pay or provide in any given calendar year shall not
affect the amount or benefit that the Company is obligated to pay in any other
calendar year and (iii) the Executive’s right to have the Company pay or provide
the amount or benefit may not be liquidated or exchanged for any other benefit.
 
 
 
7

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

 
 
Article XI. Miscellaneous
 
11.1 Severability.  If any provision of this Agreement is held to be illegal or
invalid for any reason, the illegality or invalidity will not affect the
remaining parts of the Agreement, and the Agreement will be construed and
enforced as if the illegal or invalid provision had not been included.
 
11.2 Unfunded Status of Agreement.  This Agreement is intended to constitute an
“unfunded” arrangement for executive compensation.  As to any payments due but
not yet made under this Agreement, the Executive’s rights are no greater than
those of a general creditor of the Company.  The Company is not required to fund
or otherwise set aside assets to pay the amounts owed under this
Agreement.  Notwithstanding the foregoing, immediately prior to a Change in
Control, the Company or its successor must and will establish a “rabbi” trust
with a nationally recognized financial institution as trustee and fully fund the
Severance Benefit, Gross-up Payment (if any), and any other amounts that may
become payable under this Agreement; provided, however, that the trust shall not
be funded if the funding thereof would result in taxable income to the Executive
by reason of Section 409A(b) of the Code; and provided, further, in no event
shall any trust assets at any time be located or transferred outside of the
United States, within the meaning of Section 409A(b) of the Code.  Any fees and
expenses of the trustee of any such rabbi trust shall be paid by the Company.
 
11.3 Governing Law.  The laws of the State of Illinois, other than its conflict
of law principles, will govern in all matters relating to this Agreement.
 
11.4 Nonassignability. Neither the Executive nor his or her beneficiaries or
legal representatives may assign or transfer this Agreement or any right under
it, except by will or by the laws of descent and distribution.  This Agreement
will inure to the benefit of and be enforceable by the Executive’s personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees, and legatees.
 
11.5 Settlement of Claims. The Company’s obligation to make the payments
provided for in this Agreements will not be affected by any circumstances,
including, without limitation, any set-off, counterclaim, defense, recoupment or
other right which the Company may have against the Executive or others.
 
11.6 Survivorship.  Upon the expiration or other termination of this Agreement
or the Executive’s employment, the respective rights and obligations of the
parties hereto shall survive to the extent necessary to carry out the intentions
of the parties under this Agreement.
 
11.7 Entire Agreement.  From and after the Agreement Date, this Agreement shall
supersede the Original Agreement.  From and after the Effective Date, this
Agreement shall supersede any other employment, severance or change of control
agreement between the parties   with respect to the subject matter hereof.
 

 
8

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

 

In Witness Whereof, the Company and the Executive have duly executed this
Agreement as of the date first written above.
 

Cabot Microelectronics Corporation

By:______________________________________

Its:______________________________________

_________________________________________
                    (Executive’s Signature)

Executive’s Name and Address for notices:

_________________________________________

_________________________________________

_________________________________________

 
 
 
9