Document:

exhibit10_2.htm

Exhibit 10.2

    Second
Amended and Restated Cabot Microelectronics Corporation 2000 Equity Incentive
Plan

    [Initial][Annual]
Non-Qualified Stock Option Grant Agreement for Directors

    

    

    [AWARD
DATE]

    

    

    [Director
Name]

    [Director
Address]

    

    Dear
[Director First Name]:

    

    I am
pleased to inform you (the “Participant) that the Board of Directors (the
“Board”) of Cabot Microelectronics Corporation (the “Company”), based on the
recommendation of the Nominating and Corporate Governance Committee of the
Board, has approved your participation in the Second Amended and Restated Cabot
Microelectronics Corporation 2000 Equity Incentive Plan, as amended and restated
September 23, 2008 (the "Plan") in consideration of your [initial][annual]
service as a Director of the Company. A Non-qualified Stock Option (“NQSO”)
award (the “Award”) is hereby granted to the Participant pursuant to the terms
of the Plan and this Non-Qualified Stock Option Agreement (the
“Agreement”).  A copy of the Plan is enclosed.

    

    
      	
              Participant

            	
              Type
      of Grant

            	
               

              Number
      of Option Shares Granted

            	
               

              Exercise
      Price Per Share on Grant Date, [Annual Meeting Date for Annual; Date of
      Election/ Appointment for Initial]

            	
               

              Optionee
      ID Number

            
	
               

               

               

              [Director
      Name]

            	
               

              Non-Qualified
      Stock Option

               

            	
               

              [_____]

            	
               

               [FMV/closing
      price on Grant Date, which is Annual Meeting Date for Annual; Date of
      Election/ Appointment for Initial]

            	
               

              [xxx-xx-xxxx]

            
	
              Grant
      Date [GD]

            	
              Vesting
      Dates

            	
              Expiration
      Date

            	
               

              Grant
      Number

            
	
              [Annual
      Meeting Date for Annual; Date of Election/ Appointment for Initial
      ]

            	
               

              [for
      annual grant:

              25%    1st
      anniv. GD

              25%    2d
      anniv. GD

              25%    3d
      anniv. GD

              25%    4th
      anniv. GD]

              [for
      initial grant:

              25%
      GD

              25%
      1st
      anniv. GD

              25%
      2d anniv. GD

              25%
      3d anniv. GD]

            	
               

              10th
      anniv. GD

            	
               

              [xxxxxx]

            

    

    

    This
Agreement provides the Participant with the terms of the option (the “Option”)
granted to the Participant.  The Option is not intended to qualify as
an incentive stock option pursuant to Section 422 of the Internal Revenue Code
(the “Code”).  The terms specified in this Agreement are governed by
the provisions of the Plan, which are incorporated herein by reference. The
Compensation Committee of the Board (the “Committee”) has the exclusive
authority to interpret and apply the Plan and this Agreement.  Any
interpretation of the Agreement by the Committee and any decision made by it
with respect to the Agreement are final and binding on all
persons.  To the extent that there is any conflict between the terms
of this Agreement and the Plan, the Plan shall govern. Capitalized terms used
herein will have the same meaning as under the Plan, unless stated
otherwise.

    

    In
consideration of the foregoing and the mutual covenants hereinafter set forth,
it is agreed by and between the Company and the Participant as
follows:

    

    
      	
               
      

            	
              1.

            	
              Vesting and
      Exercise. The Award shall become vested and exercisable in
      accordance with the following
table:

            

    

    

    
      	
              Installment

            	
              Vesting
      Date Applicable to Installment

            
	
               

              25%

              25%

              25%

              25%

               

            	
              For
      annual/initial:

              1st
      anniv. GD/GD

              2d
      anniv. GD/1st
      anniv. GD

              3d
      anniv. GD/2d anniv. GD

              4th
      anniv. GD/3d anniv. GD

               

            

    

    

    The Award
will be fully vested and exercisable in the event of a Change in Control, as
defined in the Plan.  In the event of a Change in Control that
constitutes a Covered Transaction (as defined in Section 7.3(c) of the Plan),
the Committee may, in its sole discretion, terminate any or all outstanding
Options as of the effective date of the Covered Transaction; provided that the
Committee may not terminate an Option outstanding under this Agreement earlier
than twenty (20) days following the later of (i) the date on which the Award
became fully exercisable, and (ii) the date on which the Participant received
written notice of the Covered Transaction.

    

    Unless
otherwise provided in this Agreement or the Plan, if the date of Participant’s
termination of Service as a Director of the Company precedes the relevant
Vesting Date, an installment shall not vest on the otherwise applicable Vesting
Date and all Options subject to such installment shall immediately terminate as
of the date of such termination of Service.

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    
 

    
      	
               
      

            	
              2.

            	
              Termination/Cancellation/Rescission.  The
      Company may terminate, cancel, rescind or recover an Award immediately
      under certain circumstances, including, but not limited to, the
      Participant’s:

            

    

    

    
      	
                                  
      (a)

            	
              actions
      constituting Cause, as defined in the Plan, or the Company’s By-laws or
      Articles of Incorporation, as
applicable;

            

    

    

    
      	
                                  
      (b)

            	
              rendering
      of services for a competitor prior to, or within six (6) months after, the
      exercise of any Option or the termination of Participant’s Service with
      the Company;

            

    

    

    
      	
                                  
      (c)

            	
              unauthorized
      disclosure of any confidential/proprietary information of the Company to
      any third party;

            

    

    

    In the
event of any such termination, cancellation, rescission or revocation, the
Participant must return any Stock obtained by the Participant pursuant to the
Award, or pay to the Company the amount of any gain realized on the sale of such
Stock, and the Company shall be entitled to set-off against the amount of any
such gain any amount owed to the Participant by the Company.  To the
extent applicable, the purchase price for such Stock shall be returned to the
Participant, including any withholding requirements.

    

    
      	
               
      

            	
              3.

            	
              Expiration.  The
      Option, including vested Options, shall not be exercisable after the
      Company’s close of business on the last business day that occurs on or
      prior to the Expiration Date. The “Expiration Date” shall be the earliest to occur
      of:

            

    

    

    
      	
              (a)  

            	
              [Ten
      Years from GD];

            

    

    

    
      	
              (b)  

            	
              If
      the Participant’s termination of Service as a Director of the Company
      occurs by reason of Cause, the date preceding the date of such
      termination;

            

    

    

    
      	
              (c)  

            	
              If
      the Participant’s termination of Service as a Director of the Company is
      for any reason other than (b) above, all Options vested and exercisable as
      of the date of termination will remain exercisable until [ten years from
      GD].  In such case of termination of Service as a Director of
      the Company occurring by reason of death or Disability, then any Options
      unvested prior to the date of such termination shall be fully vested and
      exercisable as of such date of termination. For purposes hereof,
      Disability shall have the meaning of permanent and total disability
      provided within the meaning of Section 22 (e)(3) of the Internal Revenue
      Code.

            

    

    

    In the
event that the Participant dies on or following the Participant’s termination
date and prior to the Expiration Date without having fully exercised the
Participant’s Options, then the authorized representative of the Participant’s
estate shall be entitled to exercise the Award within such limits specified in
subparagraphs (a) or (c).

    

    To the
extent that the Participant does not exercise the Option to the extent the
Participant is entitled within the time specified in subparagraph (a) or (c)
above, the Option shall immediately terminate.

    

    
      	 	
              4.

            	
              Method of Option
      Exercise. Subject to the terms of this Agreement and the Plan,
      the Participant may exercise, in whole or in part, the vested portion of
      the Option at any time by complying with any exercise procedures
      established by the Company in its sole discretion.  The
      Participant shall pay the exercise price for the portion of the Option
      being exercised to the Company in full, at the time of exercise,
      either:

            

    

    

    
      	
              (a)  

            	
              in
      cash;

            

    

     

    
      	
              (b)  

            	
              in
      shares of Stock having a Fair Market Value equal to the aggregate exercise
      price  for the shares of Stock being purchased and satisfying
      such other requirements as may be imposed by the Committee; provided,
      that, such shares of Stock have been held by the Participant for no less
      than six (6) months;

            

    

     

    
      	
              (c)  

            	
              partly
      in cash and partly in such shares of Stock;
or

            

    

    

    
      	
              (d)  

            	
              through
      the delivery of irrevocable instructions to a broker to deliver promptly
      to the Company an amount equal to the aggregate exercise price for the
      shares of Stock being purchased (“cashless
  exercise”).

            

    

     

    Anything
to the contrary herein notwithstanding, the Option cannot be exercised and the
Company shall not be obligated to issue any shares of Stock hereunder if the
Company determines that the issuance of such shares would violate the provision
of any applicable law, including the rules and regulations of any securities
exchange on which the Stock is traded.  Please refer to Section 6.2(d)
of the Plan for additional information.

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
 

    
      	
               
      

            	
              5.

            	
              Taxes.

            

    

    

    
      	
               
      

            	
                      
      (a)

            	
              All
      deliveries and distributions under this Agreement are subject to all
      applicable taxes.  As a Director of the Company, the Participant
      is subject to Section 16 (an “Insider”), of the Securities Exchange Act of
      1934 (“Exchange Act”), as well as other relevant securities laws, and any
      surrender of previously owned shares to satisfy tax withholding
      obligations arising upon exercise of an Option, or a ‘cashless exercise’
      must comply with the requirements of Rule 16b-3 promulgated under the
      Exchange Act (“Rule 16b-3”), and other relevant law, regulations and
      Company guidelines.

            

    

    

    
      	
               
      

            	
                      
      (b)

            	
              If
      the Fair Market Value of a share of stock on the date the Participant
      exercises the Option is greater than the Exercise Price, the Participant
      will be taxed on the difference multiplied by the number of shares
      purchased with cash at the date of exercise.  This income is
      taxed as ordinary income and subject to various taxes.  The
      income will be reported to the Participant as part of the Participant’s
      compensation on the Participant’s annual Form 1099 issued by the
      Company.

            

    

    

    
      	
               
      

            	
                       (c)

            	
              If
      the Participant sells the shares acquired under the Option, a long-term or
      short-term capital gain or loss may also result depending
      on:  (i) the Participant’s holding period for the shares, and
      (ii) the difference between the Fair Market Value of the shares at the
      time of the sale and the Participant’s tax basis in the
      shares.  The holding period is determined from the date the
      Option is exercised.  Under current law, the capital gain or
      loss is long term if the property is held for more than one (1) year, and
      short term if the property is held for less than one (1) year. If the
      Exercise Price of an Option is paid in cash, the tax basis of the shares
      thereby acquired is the sum of (i) the Exercise Price paid for the shares,
      and (ii) the ordinary income, if any, determined by the difference between
      the Fair Market Value of the shares when exercised and the Exercise
      Price.

            

    

    

    EACH
PARTICIPANT IS URGED TO CONSULT WITH HIS OWN TAX ADVISOR TO DETERMINE THE
PARTICULAR TAX CONSEQUENCES INCLUDING THE APPLICABILITY AND EFFECT OF FEDERAL,
LOCAL AND OTHER TAX LAWS.

    

    
      	
               
      

            	
              6.

            	
              Transferability.  The
      Option is not transferable other than: (a) by will or by the laws of
      descent and distribution; (b) pursuant to a domestic relations order; or
      (c) to members of the Participant’s immediate family, to trusts solely for
      the benefit of such immediate family members or to partnerships in which
      family members and/or trusts are the only partners, all as provided under
      the terms of the Plan.  After any such transfer, the Option
      shall remain subject to the terms of the
Plan.

            

    

    

    
      	
               
      

            	
              7.

            	
              Adjustment of
      Shares.  In the event of any transaction described in
      Section 8.6 of the Plan, the terms of this Option (including, without
      limitation, the number and kind of shares subject to this Option and the
      Exercise Price) shall be adjusted as set forth in Section 8.6 of the
      Plan.

            

    

    

    
      	
               
      

            	
              8.

            	
              Not an Employment
      Contract; Shareholder Rights.  The grant of an Option
      does not confer on the Participant any contractual employment or
      shareholder rights.  The Participant will not have shareholder
      rights with respect to any shares of stock subject to the Option until the
      Option is exercised and the shares are issued and transferred on the books
      of the Company to the Participant.  No adjustment shall be made
      for dividends, distributions or other rights for which the record date is
      prior to such date, except as provided under the
  Plan.

            

    

    

    
      	
               
      

            	
              9.

            	
              Severability.  In
      the event that any provision of this Agreement is found to be invalid,
      illegal or incapable of being enforced by any court of competent
      jurisdiction for any reason, in whole or in part, the remaining provisions
      of this Agreement shall remain in full force and effect to the fullest
      extent permitted by law.

            

    

    

    
      	 	
              10.

            	
              Waiver.  Failure
      to insist upon strict compliance with any of the terms and conditions of
      this Agreement or the Plan shall not be deemed a waiver of such term or
      condition.

            

    

    

    
      	 	
              11.

            	
              Notices.  Any
      notices provided for in this Agreement or the Plan must be in writing and
      hand delivered, sent by fax or overnight courier, or by postage paid first
      class mail.  Notices are to be sent to the Participant at the
      address indicated by the Company’s records and to the Company at its
      principal executive office.

            

    

    

    
      	 	
              12.

            	
              Governing
      Law.  This Agreement shall be construed under the laws of
      the State of Illinois.

            

    

    

    IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed in its
name and on its behalf, all as of the Grant Date.

    

    CABOT
MICROELECTRONICS CORPORATION

     

    William
P. Noglows

                                                                   
Chairman and Chief Executive Officer

     

     

    3exhibit10_4.htm

Exhibit 10.4

    Second
Amended and Restated Cabot Microelectronics Corporation 2000 Equity Incentive
Plan

    Non-Qualified
Stock Option Grant Agreement

    (United
States Employees)

    

    

    

    

    GRANT
DATE

    

    NAME

    ADDRESS

    CITY,
STATE ZIP

    

    Dear
FIRST NAME:

    

    I am
pleased to inform you (the “Participant”) that the Compensation Committee of the
Board of Directors (the “Committee”) of Cabot Microelectronics Corporation (the
“Company”) has approved your participation in the Second Amended and Restated
Cabot Microelectronics Corporation 2000 Equity Incentive Plan, as amended and
restated September 23, 2008 (the "Plan").   A Non-Qualified
Stock Option (“NQSO”) award (the “Award”) is hereby granted to the Participant
pursuant to the terms of the Plan and this Non-Qualified Stock Option Agreement
(the “Agreement”).  A copy of the Plan can be electronically accessed
through the CMC world directory under “HR Information/Stock/General Plan
Information”.

    

    
      	
               

              PARTICIPANT

            	
               

              Type
      of Grant

            	
              Number
      of Option Shares Granted

            	
              Exercise
      Price Per Share on [grant date]

            	
              Participant
      ID Number

            
	
               

               

               

              NAME

               

               

            	
               

              Non-qualified
      Stock Option

            	
               

              [____]

               

            	
              $XX.XX

              [general:
      grant date (GD) fmv/close price]

            	
               

              XXX-XX-XXXX

            
	
              Grant
      Date

            	
              Vesting Dates
      [general]

            	
              Expiration
      Date

            	
               

              Grant
      Number

            
	
              [date
      of grant]

            	
              25%           1stanniv.
      GD

              25%           2danniv.
      GD

              25%           3danniv.
      GD

              25%           4thanniv.
      GD

            	
               

              DATE             [general:
      tenth anniv. GD]

            	
               

              000000XXXX

            

    

    

    This Agreement provides the Participant
with the terms of the option (the “Option”) granted to the
Participant.  The Option is not intended to qualify as an incentive
stock option pursuant to Section 422 of the Internal Revenue Code (the
“Code”).  The terms specified in this Agreement are governed by the
provisions of the Plan, which are incorporated herein by reference. The
Committee has the exclusive authority to interpret and apply the Plan and this
Agreement.  Any interpretation of the Agreement by the Committee and
any decision made by it with respect to the Agreement are final and binding on
all persons.  To the extent that there is any conflict between the
terms of this Agreement and the Plan, the Plan shall govern. Capitalized terms
used herein will have the same meaning as under the Plan, unless stated
otherwise.

    

    In consideration of the foregoing and
the mutual covenants hereinafter set forth, it is agreed by and between the
Company and the Participant as follows:

    
      	
              1.

            	
              Vesting and
      Exercise.  The Award shall become vested and exercisable
      in accordance with the following
table:

            

    

    
      	
              Installment

            	
              Vesting
      Date Applicable to Installment [general]

            
	
              25%

              25%

              25%

              25%

            	
                                                            
      [1st
      anniv.  GD]

              [2d
      anniv. GD]

              [3d
      anniv. GD]

              [4th
      anniv. GD]

            

    

    

    The Award
will be fully vested and exercisable in the event of a Change in Control, as
defined in the Plan.  In the event of a Change in Control that
constitutes a Covered Transaction (as defined in Section 7.3(c) of the Plan),
the Committee may, in its sole discretion, terminate any or all outstanding
Options as of the effective date of the Covered Transaction; provided that the
Committee may not terminate an Option outstanding under this Agreement earlier
than 20 days following the later of (i) the date on which the Award became fully
exercisable, and (ii) the date on which the Participant received written notice
of the Covered Transaction.

    

    
      	
               
      

            	
              Unless
      otherwise provided in this Agreement or the Plan, if the date of
      Participant’s termination of Service with the Company, as defined in the
      Plan, precedes the relevant Vesting Date, an installment shall not vest on
      the otherwise applicable Vesting Date and all Options subject to such
      installment shall immediately terminate as of the date of such termination
      of Service.

            

    

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    
 

    
      	
              2.

            	
              Termination /
      Cancellation / Rescission.  The Company may terminate,
      cancel, rescind or recover an Award immediately under certain
      circumstances, including, but not limited to, the
      Participant’s:

            

    

    

    
      	
              (a)  

            	
              actions
      constituting Cause, as defined in the Plan and as otherwise enforceable
      under local law;

            

    

    

    
      	
               
      

            	
                  
      (b)

            	
              rendering
      of services for a competitor prior to, or within six (6) months after, the
      exercise of any Option or the termination of Participant's Service with
      the Company;

            

    

    

    
      	
               
      

            	
                   (c)

            	
              unauthorized
      disclosure of any confidential/proprietary information of the Company to
      any third party;

            

    

    

    
      	
               
      

            	
                  
      (d)

            	
              failure
      to comply with the Company’s policies regarding the identification,
      disclosure and protection of intellectual
  property;

            

    

    

    
      	
               
      

            	
                  
      (e)

            	
              violation
      of the Cabot Microelectronics Corporation Employee Confidentiality,
      Intellectual Property and Non-Competition
  Agreement.

            

    

    

    
      	
               
      

            	
              In
      the event of any such termination, cancellation, rescission or revocation,
      the Participant must return any Stock obtained by the Participant pursuant
      to the Award, or pay to the Company the amount of any gain realized on the
      sale of such Stock, and the Company shall be entitled to set-off against
      the amount of any such gain any amount owed to the Participant by the
      Company.  To the extent applicable, the purchase price for such
      Stock shall be returned to the Participant, including any withholding
      requirements.

            

    

    

    
      	
              3.

            	
              Purpose of
      Award. The Award is intended to promote goodwill between the
      Participant and the Company and shall not be considered as salary or other
      remuneration for any employment or other services the Participant may
      perform for the Company or any of its affiliates.  The Company’s
      grant of the Option does not confer any contractual or other rights of
      employment or service with the Company.  Benefits granted under
      the Plan shall not be considered as part of the Participant’s salary in
      the event of severance, redundancy or resignation. Granting of the Award
      shall also not be construed as creating any right on the part of
      Participant to receive any additional benefits including awards in the
      future, it being expressly understood and agreed that any future awards
      shall be made solely at the discretion of the
  Company.

            

    

     

    
      	
              4.

            	
              Expiration.  The
      Option, including vested Options, shall not be exercisable after the
      Company’s close of business on the last business day that occurs on or
      prior to the Expiration Date. The “Expiration Date” shall be the earliest to occur
      of:

            

    

    

    
      	
              (a)  

            	
              [general:
      tenth anniv. GD];

            

    

    

    
      	
                      
      (b)

            	
              If
      the Participant’s termination of Service occurs by reason of death or
      Disability, the three (3) year anniversary of the date of such termination
      or the ten (10) year anniversary of the Grant Date, whichever is
      sooner.  In such case of termination of Service occurring by
      reason of death or Disability, then any unvested portion of the Option
      shall be fully vested and exercisable as of such date of termination. For
      purposes hereof, “Disability” shall have the meaning provided under: (i)
      first, an employment agreement between the Participant and the Company;
      (ii) second, if no such employment agreement exists, the long-term
      disability program maintained by the Company or any governmental entity
      covering the Participant; or (iii) third, if no such agreement or program
      exists, permanent and total disability within the meaning of Section 22
      (e)(3) of the Code;

            

    

    

    
      	
                      
      (c)

            	
              If
      the Participant’s termination of Service occurs by reason of Cause, the
      date preceding the date of such
termination;

            

    

    

    
      	
                      
      (d)

            	
              If
      the Participant’s termination of Service occurs by reason of Change in
      Control, three (3) months after the date of such
    termination;

            

    

    

    
      	
                      
      (e)

            	
              If
      the Participant’s termination of Service occurs by reason of Retirement,
      all Options vested and exercisable as of the date of such termination will
      remain exercisable until the ten (10) year anniversary of the Grant
      Date.  For purposes hereof, “Retirement” shall mean the
      termination of the Participant’s Service following the Participant’s
      attainment of at least (i) five years of employment with the Company and (ii) 55
      years of age, provided,
      however, that the Participant’s termination of Service will not be
      deemed to have occurred by reason of Retirement if the Participant’s
      Service has been terminated by reason of Cause, as determined by the
      Company in its sole discretion; or

            

    

    

    
      	
                      
      (f)

            	
              If
      the Participant’s termination of Service is for any reason other than (b),
      (c), (d) or (e) above, all Options vested and exercisable as of the date
      of termination will remain exercisable for one (1) month after the
      termination date, after which all unexercised Options are
      terminated.

            

    

    

    In the
event that the Participant dies on or following the Participant’s termination
date and prior to the Expiration Date without having fully exercised the
Participant’s Options, then the authorized representative of the Participant’s
estate shall be entitled to exercise the Award within such limits specified in
subparagraphs (b), (d) or (e).

    

    To the
extent that the Participant does not exercise the Option to the extent the
Participant is entitled within the time specified in subparagraphs (a), (b), (d)
or (e) above, the Option shall immediately terminate.

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
 

    5.   Method of Option
Exercise.  Subject to the terms of this Agreement and the Plan,
the Participant may exercise, in whole or in part, the vested portion of the
Option at any time by complying with any exercise procedures established by the
Company in its sole discretion.  The Participant shall pay the
exercise price for the portion of the Option being exercised to the Company in
full, at the time of exercise, either:

     

     

    
      	
              (a)  

            	
              in
      cash;

            

    

     

    
      	
              (b)  

            	
              in
      shares of Stock having a Fair Market Value equal to the aggregate exercise
      price  for the shares of Stock being purchased and satisfying
      such other requirements as may be imposed by the Committee; provided,
      that, such shares of Stock have been held by the Participant for no less
      than six months;

            

    

     

    
      	
              (c)  

            	
              partly
      in cash and partly in such shares of Stock;
or

            

    

     

    
      	
              (d)  

            	
              through
      the delivery of irrevocable instructions to a broker to deliver promptly
      to the Company an amount equal to the aggregate exercise price for the
      shares of Stock being purchased (“cashless
  exercise”).

            

    

     

    Anything
to the contrary herein notwithstanding, the Option cannot be exercised and the
Company shall not be obligated to issue any shares of Stock hereunder if the
Company determines that the issuance of such shares would violate the provision
of any applicable law, including the rules and regulations of any securities
exchange on which the Stock is traded.  Please refer to Section 6.2(d)
of the Plan for additional information.

     

    
      	
              6.  

            	
              Taxes.

            

    

    

    
      	
                       
      (a)

            	
              All
      deliveries and distributions under this Agreement are subject to
      withholding of all applicable taxes based on country specific tax
      requirement.  Please refer to electronic copy of “Taxes” for
      your individual circumstances based on your location.  The
      various methods and manner by which the tax withholding may be satisfied
      are set forth in Section 8.4 of the Plan.  If the Participant is
      subject to Section 16 (an “Insider”), of the Securities Exchange Act of
      1934 (“Exchange Act”) and other securities laws, any surrender of
      previously owned shares to satisfy tax withholding obligations arising
      upon exercise of an Option must comply with the requirements of Rule 16b-3
      promulgated under the Exchange Act (“Rule 16b-3”) and other relevant rules
      and regulations.

            

    

    

    
      	
                       
      (b)

            	
              If
      the Fair Market Value of a share of stock on the date the Participant
      exercises the Option is greater than the Exercise Price, the Participant
      will be taxed on the difference multiplied by the number of shares
      purchased with cash at the date of exercise.  This income is
      taxed as ordinary income and subject to various withholding
      taxes.  The Company is required to withhold and remit these
      taxes to the appropriate tax authorities.  If the exercise of
      the Option results in no cash payment to the Participant from which the
      Company could withhold the income and FICA taxes, the Participant will be
      required to provide the Company with an amount of cash sufficient to
      satisfy the Participant’s tax withholding obligations or to make
      arrangements satisfactory to the Company with regard to such taxes, which
      in most instances can be done through the services provided by a
      broker.  If the Participant does not pay the amount of required
      withholding to the Company, the Company will withhold from the shares
      delivered or from other amounts payable to the Participant, the minimum
      amount of funds required to cover all applicable federal, state and local
      income and employment taxes required to be withheld by the Company by
      reason of such exercise of the Option.  The income will be
      reported to the Participant as part of the Participant’s employment
      compensation on the Participant’s annual earnings
    statement.

            

    

    

    
      	
                       
      (c)

            	
              If
      the Participant sells the shares acquired under the Option, a long-term or
      short-term capital gain or loss may also result depending
      on:  (i) the Participant’s holding period for the shares, and
      (ii) the difference between the Fair Market Value of the shares at the
      time of the sale and the Participant’s tax basis in the
      shares.  The holding period is determined from the date the
      Option is exercised.  Under current law, the capital gain or
      loss is long term if the property is held for more than one year, and
      short term if the property is held for less than one year. If the Exercise
      Price of an Option is paid in cash, the tax basis of the shares thereby
      acquired is the sum of (i) the Exercise Price paid for the shares, and
      (ii) the ordinary income, if any, determined by the difference between the
      Fair Market Value of the shares when exercised and the Exercise
      Price.

            

    

    

    
      	
               
      

            	
              EACH
      PARTICIPANT IS URGED TO REVIEW THE U.S. TAX COMMUNICATION INFORMATION AND
      TO CONSULT WITH HIS OR HER OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX
      CONSEQUENCES INCLUDING THE APPLICABILITY AND EFFECT OF FEDERAL, LOCAL AND
      OTHER TAX LAWS.

            

    

    

    
      	
              7.

            	
              Transferability.
      The Option is not transferable other than: (a) by will or by the laws of
      descent and distribution; (b) pursuant to a domestic relations order; or
      (c) to members of the Participant’s immediate family, to trusts solely for
      the benefit of such immediate family members or to partnerships in which
      family members and/or trusts are the only partners, all as provided under
      the terms of the Plan.  After any such transfer, the Option
      shall remain subject to the terms of the
Plan.

            

    

    

    
      	
              8.

            	
              Adjustment of
      Shares.  In the event of any transaction described in
      Section 8.6 of the Plan, the terms of this Option (including, without
      limitation, the number and kind of shares subject to this Option and the
      Exercise Price) shall be adjusted as set forth in Section 8.6 of the
      Plan.

            

    

    

    
      	
              9.

            	
              Shareholder
      Rights.  Participant shall have no rights as a
      stockholder with respect to any shares of Stock subject to the Option
      until the Option is exercised and the shares are issued and transferred on
      the books of the Company to the Participant.  No adjustment
      shall be made for dividends, distributions or other rights for which the
      record date is prior to such date, except as provided under the
      Plan.

            

    

    

    
      	
              10.

            	
              Data
      Privacy.  In order to perform its requirements under this
      Plan, the Company may process sensitive personal data about the
      Participant.  Such data includes but is not limited to the
      information provided in this grant package and any changes thereto, other
      appropriate personal and financial data about the Participant, and
      information about the Participant’s participation in the Plan and shares
      exercised under the Plan from time to time.  By signing the
      attached acceptance form, the Participant hereby gives explicit consent to
      the Company to process any such data.  The Participant also
      hereby gives explicit consent to the Company to transfer any
      personal data outside the country in which the Participant is employed and
      to the United States.  The legal persons for whom the personal
      data is intended includes the Company and any of its subsidiaries, the
      outside plan administrator as selected by the Company from time to time
      and any other person that the Company may find appropriate in its
      administration of the Plan.  The Participant may review and
      correct any personal data by contacting his local Human Resources
      Representative. The Participant understands that the transfer of the
      information outlined here is important to the administration of the Plan
      and failure to consent to the transmission of such information may limit
      or prohibit participation in the
Plan.

            

    

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
 

    
      	
              11.

            	
              Severability.  In
      the event that any provision of this Agreement is found to be invalid,
      illegal or incapable of being enforced by any court of competent
      jurisdiction for any reason, in whole or in part, the remaining provisions
      of this Agreement shall remain in full force and effect to the fullest
      extent permitted by law.

            

    

    

    
      	
              12.

            	
              Waiver.  Failure
      to insist upon strict compliance with any of the terms and conditions of
      this Agreement or the Plan shall not be deemed a waiver of such term or
      condition.

            

    

    

    
      	
              13.

            	
              Notices.  Any
      notices provided for in this Agreement or the Plan must be in writing and
      hand delivered, sent by fax or overnight courier, or by postage paid first
      class mail.  Notices are to be sent to the Participant at the
      address indicated by the Company’s records and to the Company at its
      principal executive office.

            

    

    

    
      	
              14.

            	
              Governing
      Law.  This Agreement shall be construed under the laws of
      the State of Illinois.

            

    

    

    

    
      	
               
      

            	
              IN
      WITNESS WHEREOF, the Company has caused this Agreement to be executed in
      its name and on its behalf, all as of the Grant
  Date.

            

    

    
 

        CABOT
MICROELECTRONICS CORPORATION

     

         William
P. Noglows

                                                               
Chairman and Chief Executive Officer

    

    

    

    

    

    4

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