UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
     
Date of Report (Date of Earliest Event Reported):
 
 March 12, 2010

STANLEY BLACK & DECKER, INC.
 (Exact name of registrant as specified in its charter)
     
Connecticut
1-5244
06-0548860
(State or other jurisdiction
of incorporation)
 (Commission File Number)
 (I.R.S. Employer Identification No.)
  
   
1000 Stanley Drive, New Britain, Connecticut
 
06053
(Address of principal executive offices)
 
(Zip Code)
     
Registrant’s telephone number, including area code:
 
(860) 225-5111
Not Applicable
 
Former name or former address, if changed since last report

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 [  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 [  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 [  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 [  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



 
Item 1.01.  Entry into a Material Definitive Agreement.

           See disclosure contained in Item 2.03 below, which is incorporated herein by reference.
 
 
Item 2.01.  Completion of Acquisition or Disposition of Assets.

On March 12, 2010, pursuant to the terms and conditions of the Agreement and Plan of Merger, dated as of November 2, 2009 (the “Merger Agreement”), among The Stanley Works (“Stanley”), The Black & Decker Corporation (“Black & Decker”) and Blue Jay Acquisition Corp., a wholly owned subsidiary of Stanley (“Merger Sub”), Merger Sub merged with and into Black & Decker, with Black & Decker continuing as the surviving corporation and as a wholly owned subsidiary of Stanley (the “Merger”).
 
As a result of the Merger, each outstanding share of Black & Decker common stock was converted into the right to receive 1.275 shares of our common stock (“Stanley Common Stock”), with cash paid in lieu of fractional shares.  Based on the closing price of the Stanley Common Stock on March 11, 2010 the consideration received by Black & Decker stockholders had a value of approximately $4.7 billion.
 
As previously announced, we plan to begin conducting business under the name Stanley Black & Decker in conjunction with consummating the Merger, and we have formally changed our name to “Stanley Black & Decker, Inc.” effective on March 12, 2010.  Additional information regarding the Merger may be found in the press release issued by Stanley in connection with the announcement of the completion of the Merger, which is filed as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference.
 
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which is included as Exhibit 2.1 to this current report on Form 8-K and is incorporated by reference herein.
 
 
Item 2.03.  Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

New Credit Facility

           On March 12, 2010, Stanley Black & Decker, Inc. (the “Registrant”) entered into a 364-Day Credit Agreement (the “Credit Agreement”) with The Black & Decker Corporation, as Subsidiary Guarantor, and each of the initial lenders named therein, Citibank, N.A., as Administrative Agent, Citigroup Global Markets Inc. and Banc of America Securities LLC, as Lead Arrangers and Bookrunners, and Bank of America, N.A., as Syndication Agent, to obtain extensions of credit and revolving commitments aggregating $700 million (the “Credit Facility”).

Borrowings under the Credit Facility will bear interest at a floating rate or rates equal to, at the option of the Registrant, the Eurocurrency rate or the prime rate, plus a margin specified in the Credit Agreement for Eurocurrency rate advances.  A certain amount of the borrowings may be made in Euros or Pounds Sterling by certain designated subsidiaries of the Registrant.

The Registrant must repay all advances by the earlier of (i) March 11, 2011 or (ii) the date of termination in whole, at the election of the Registrant, of the commitments by the lenders under the Credit Facility, pursuant to the terms of the Credit Agreement. The Credit Agreement provides the Registrant with the right to request prior to the Termination Date to convert all outstanding Advances to a term loan with a maturity date no later than March 11, 2012, as determined by the Registrant as long as certain conditions specified in the Credit Agreement are satisfied.  The Registrant may be required to prepay any borrowings under the Credit Facility upon a change of control.

The Registrant does not anticipate it will draw on the Credit Facility in the near term.  The Credit Facility serves primarily as a backstop to the Registrant's commercial paper program.

The Credit Agreement contains covenants that include, among other things:
 
   
●
maintenance of an EBITDA interest covenant ratio which provides for the exclusion of certain restructuring charges and charges associated with the Merger as well as certain adjustments to reported interest;
   
●
a limitation on creating liens on certain property of the Registrant and its subsidiaries;
   
●
a restriction on mergers, consolidations and sales of substantially all of the assets of the Registrant or its subsidiaries;
   
●
a restriction on entering into certain sale-leaseback transactions.
 
 
 
 
The Credit Facility contains customary events of default. If an event of default occurs and is continuing, the Registrant might be required to repay all amounts outstanding under the Credit Facility.

The investment and commercial banking firms that are parties to the Credit Agreement or their affiliates have in the past performed, and may in the future from time to time perform, investment banking, financial advisory, lending and/or commercial banking services for the Registrant and certain of its subsidiaries and affiliates.

The description contained herein is a summary of certain material terms of the Credit Agreement and is qualified in its entirety by reference to the Credit Agreement attached as Exhibit 10.4 hereto.

Cross-Guarantees

In connection with the Merger, on March 12, 2010, the Registrant and Black & Decker entered into supplemental indentures (the “Supplemental Indentures”) providing for (i) senior unsubordinated guarantees by Black & Decker (the “Black & Decker Guarantees”) of the Registrant’s existing notes described below and (ii) senior unsubordinated guarantees by the Registrant (the “Stanley Guarantees”) of Black & Decker’s existing notes described below.

The Black & Decker Guarantees are in respect of:

   
●
The Registrant’s 6.15% Notes due 2013 (the “Stanley 2013 Notes”);
       
   
●
The Registrant’s 4.9% Notes due 2012 (the “Stanley 2012 Notes”);
       
   
●
The Registrant’s convertible notes due 2012 (the “Stanley Convertible Notes”); and
       
   
●
The Registrant’s 5.0% Notes due 2010 (the “Stanley 2010 Notes” and, together with the Stanley 2013 Notes, the Stanley 2012 Notes and the Stanley Convertible Notes, the “Stanley Notes”).

Each of the Stanley Notes was issued under an Indenture, dated as of November 1, 2002 (the “Stanley Indenture”), between Stanley and The Bank of New York Mellon Trust Company, as successor trustee to JPMorgan Chase Bank, N.A.

The Stanley Guarantees are in respect of:

    ●
$300,000,000 aggregate principal amount of Black & Decker’s 5.75% Notes due 2016 (the “Black & Decker 2016 Notes”);
       
    ● 
$350,000,000 aggregate principal amount of Black & Decker’s 8.95% Notes due 2014 (the “Black & Decker 2014 8.95% Notes”);
       
    ● 
$300,000,000 aggregate principal amount of Black & Decker’s 4.75% Notes due 2014 (the “Black & Decker 2014 4.75% Notes”);
       
    ● 
$400,000,000 aggregate principal amount of Black & Decker’s 7.125% Notes due 2011 (the “Black & Decker 2011 Notes”); and
       
    ●
$150,000,000 aggregate principal amount of 7.05% Notes due 2028 issued by Black & Decker Holdings, LLC (formerly Black & Decker Holdings Inc.), an indirect wholly-owned subsidiary of Black & Decker (the “Black & Decker 144A Notes” and, together with the Black & Decker 2016 Notes, the Black & Decker 2014 8.95% Notes, the Black & Decker 2014 4.75% Notes and the Black & Decker 2011 Notes,  the “Black & Decker Notes”).

The Stanley Guarantees are unsecured obligations of the Registrant, ranking equal in right of payment with all the Registrant’s existing and future unsecured and unsubordinated indebtedness.  Interest on each series of Black & Decker Notes is payable semi-annually.  Each of the Black & Decker Notes (other than the Black & Decker 144A Notes) and Black & Decker’s guarantee of the Black & Decker 144A Notes rank equally with all of Black & Decker’s other unsecured and unsubordinated indebtedness.
 
 
 
 
Each of the Black & Decker 2016 Notes and Black & Decker 2014 8.95% Notes was issued under an Indenture, dated as of November 16, 2006 (the “Black & Decker 2006 Indenture”), between Black & Decker and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.  The Black & Decker 2014 4.75% Notes were issued under an Indenture, dated as of October 18, 2004 (the “Black & Decker 2004 Indenture”), between Black & Decker and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.  The Black & Decker 2011 Notes were issued under an Indenture, dated as of June 5, 2001 (the “Black & Decker 2001 Indenture”), between Black & Decker and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.  The Black & Decker 144A Notes were issued under an Indenture, dated as of June 26, 1998 (the “Black & Decker 1998 Indenture”), among Black & Decker Holdings, LLC (formerly Black & Decker Holdings Inc.), Black & Decker, as guarantor, and The Bank of New York Mellon (formerly known as The First National Bank of Chicago), as trustee.  The foregoing indentures are referred to collectively herein as the “Black & Decker Indentures.”

Each Black & Decker Indenture contains certain negative covenants that limit Black & Decker’s ability and the ability of certain of its subsidiaries to incur certain liens, engage in certain sale-leaseback transactions, and merge or consolidate or sell all or substantially all of Black & Decker's assets.  Each Black & Decker Indenture provides for customary events of default, including a failure by Black & Decker to pay the principal of, premium, if any, interest or additional amounts, if any, on any indebtedness in excess of $50,000,000, in the case of the Black & Decker 2006 Indenture and the Black & Decker 2004 Indenture, or $20,000,000, in the case of the Black & Decker 2001 Indenture and the Black & Decker 1998 Indenture, or acceleration of the maturity of such indebtedness in such amounts.  In addition, each of the Black & Decker Notes are redeemable, in whole or in part, at the issuer’s option, at the redemption price set forth in the applicable Black & Decker Indenture.

With respect to the Black & Decker 2016 Notes and Black & Decker 2014 8.95% Notes, upon the occurrence of a change of control repurchase event, unless Black & Decker has exercised its option to redeem such notes as described above, Black & Decker will be required to make an offer to repurchase all outstanding Black & Decker 2016 Notes and Black & Decker 2014 8.95% Notes at a price in cash equal to 101% of the principal amount of such notes, plus any accrued and unpaid interest to, but not including, the purchase date.  The change of control repurchase event is defined as both a change of control and a below investment grade rating event (i) that occurs within 60 days following public notice of the occurrence of a change of control, (ii) where the company ’ s senior unsecured debt is rated less than Baa3 by Moody ’ s and less than BBB- by S&P, each defined in the applicable indenture and (iii) the rating agency making the reduction in rating announces or informs the trustee in writing that the reduction was the result of an event relating to the change of control.  Based upon discussions with the ratings agencies, the Company expects that its senior unsecured debt, including the above referenced notes, will be rated A, Baa1, and A- by S&P, Moody’s and Fitch, respectively.

The foregoing description of the Supplemental Indentures, the Stanley Indentures and the Black & Decker Indenture is not complete and is qualified in its entirety by reference to the full and complete terms of the Supplemental Indentures, the Stanley Indenture and the Black & Decker Indentures which are attached to this Current Report on Form 8-K as Exhibits 4.1, 4.2, 4.3, 4.4, 4.5, 4.6, 4.7, 4.8 and 4.9 and are incorporated herein by reference.

 
Item 3.03.  Material Modifications to Rights of Security Holders.
 
The information described under Item 5.03 below is incorporated by reference herein.
 
 
Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
 
Appointment of New Directors .   

Effective upon completion of the Merger, Stanley expanded the size of our Board of Directors (the “Board”) from 9 to 15 members.  At such time, pursuant to the Merger Agreement, our Board appointed the individuals set forth below (each of whom served as a director of Black & Decker prior to the effective time of the Merger) to the Board to fill the vacancies created by such expansion until the next shareholders meeting at which directors are elected.  
 
Name
Benjamin H. Griswold, IV
George W. Buckley
M. Anthony Burns
Manuel A. Fernandez
Nolan D. Archibald
Robert L. Ryan

            It is not known as of the filing date of this Current Report on which Board Committees each of the individuals listed above will serve.
 
 

 
In connection with their appointments as directors, each of the new directors listed above (except for Mr. Archibald) will participate in Stanley’s Restricted Stock Unit Plan for Non-Employee Directors.  A description of such plan can be found in Stanley’s Proxy Statement filed March 20, 2009 and is incorporated herein by reference.

Effective immediately upon completion of the Merger, John F. Lundgren resigned as Chairman of the Board and Nolan D. Archibald was elected as the new Chairman of the Board.
 
In connection with the consummation of the Merger, each of (i) Nolan D. Archibald’s Executive Chairman Agreement, (ii) John F. Lundgren’s Second Amended and Restated Employment Agreement and (iii) James M. Loree’s Employment Agreement have become effective.  Each of the agreements listed above was previously summarized in Stanley’s Current Report on Form 8-K filed on November 3, 2009, which is incorporated by reference in this Current Report on Form 8-K.

            Effective immediately upon completion of the Merger, Jack G. Breen was appointed as the Lead Independent Director of the Board, a newly created position.

Other Changes in Management

For information on additional changes in management made in connection with the Merger, see Item 8.01 below.

Amendment to Stanley 2009 Long-Term Incentive Plan

On March 12, 2010 Stanley shareholders approved the amendment to The Stanley Works 2009 Long-Term Incentive Plan (as so amended, the “Amended LTIP”) that was contemplated in conjunction with the consummation of the Merger.  The Stanley board of directors had previously adopted, subject to shareholder approval, the Amended LTIP on January 25, 2010.  These amendments are described in detail in our joint proxy statement-prospectus filed on December 4, 2009, as amended by Amendment No. 1 filed on January 15, 2010 and Amendment No. 2 filed on February 2, 2010 and declared effective on February 3, 2010 (the “Form S-4”) and are incorporated herein by reference.
 
 
Item 5.03.  Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Amendment to Certificate of Incorporation

In connection with the Merger Agreement and as approved by our shareholders on March 12, 2010, Stanley filed a Certificate of Amendment to the Restated Certificate of Incorporation to (a) provide for an increase in the number of shares of Stanley stock authorized for issuance from 210,000,000 shares (divided into 200,000,000 common shares of par value of $2.50 per share and 10,000,000 preferred shares, without par value) to 310,000,000 shares (divided into 300,000,000 common shares of par value of $2.50 per share and 10,000,000 preferred shares, without par value); and (b) change the name of Stanley to “Stanley Black & Decker, Inc.”.  These amendments reflect changes contemplated or necessitated by the Merger Agreement and are described in detail in the Form S-4.

Our Certificate of Amendment to the Restated Certificate of Incorporation is incorporated by reference as Exhibit 3.1 to this current report on Form 8-K and is incorporated by reference herein.

Amendment to Bylaws

Effective March 12, 2010, Stanley amended and restated its Bylaws.  The primary purpose of the amendment, which did not require shareholder approval, was to implement certain changes necessitated by the Merger.  The following summary of the amendments to Stanley’s Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Bylaws filed as Exhibit 3.2 to this Current Report on Form 8-K, which is incorporated herein by reference.
 
Article I has been amended to provide that the Annual Meeting of shareholders may be held in any month each year.  The former provision limited the shareholder meeting to the months of February, March or April.
 
Article III has been amended to specify that the Lead Independent Director shall be part of the Executive Committee.
 
Article IV has been amended to (i) provide that the Board has the power to elect a Lead Independent Director, (ii) provide that the CEO (if such person is a Director) shall preside over meetings of the Board in the Chairman’s absence, (iii) create the position of Lead Independent Director, who shall preside over all meetings of the Board in the absence of both the Chairman and CEO.
 
 

Item 8.01.  Other Events.

Amendment to the Amended and Restated 5-Year Credit Agreement

Effective immediately upon the Merger, Stanley entered into Amendment No. 2 to the Amended and Restated Credit Agreement, dated as of February 27, 2008, among Stanley, the lenders party thereto and Citibank, N.A., as administrative agent.   Such Amendment No. 2 is attached hereto as Exhibit 10.5.

Changes in Management

Effective immediately upon completion of the Merger, the title of each of the following executive officers of Stanley will be as listed below:

Name
Position
 
John F. Lundgren
President & Chief Executive Officer
Donald Allan, Jr.
Senior Vice President & Chief Financial Officer
Jeffrey D. Ansell
Senior Vice President & Group Executive, Construction and DIY
Bruce H. Beatt
Senior Vice President, General Counsel and Secretary
D. Brett Bontrager
Senior Vice President & Group Executive, Convergent Security Solutions
Justin C. Boswell
Senior Vice President & Group Executive, Mechanical Security
Hubert W. Davis, Jr.
Senior Vice President & Chief Information Officers/SFS
Massimo Grassi
President, Industrial & Auto Repair
Mark J. Mathieu
Senior Vice President, Human Resources

                The responsibilities of those individuals listed above will be substantially similar to their responsibilities prior to the effective date of the Merger.
 
 

 
Effective immediately upon completion of the Merger, Stanley appointed five former executives of Black & Decker as executive officers of Stanley.  The names and positions of these five people are as listed below:

Name
Position
 
Jaime Ramirez
President, Construction & DIY, Latin America
Ben S. Sihota
President, Emerging Markets, Pacific Group
William Taylor
President, Professional Power Tools
Michael A. Tyll
President, Engineered Fastening
John Wyatt
President, Construction & DIY EMEA

Announcement of Completion of Merger   

A copy of the press release announcing the completion of the Merger is attached as Exhibit 99.2 to this current report on Form 8-K and incorporated by reference herein.

Amendment and Restatement of Corporate Governance Guidelines

On March 12, 2010 the Stanley Board amended and restated Stanley’s Corporate Governance Guidelines.  The following summary of the amendments to Stanley’s Corporate Governance Guidelines does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Corporate Governance Guidelines filed as Exhibit 99.1 to this Current Report on Form 8-K, which is incorporated herein by reference:
 
Section 1 was amended to clarify that the Board now has 15 members.
 
Section 2 was amended to (i) provide that the current practice of Stanley is to separate the offices of Chairman and CEO, rather than combine the two positions, (ii) clarify who, among the Chairman, CEO and Lead Independent Director, shall preside over meetings of the Board, (iii) clarify that the presiding Board member shall ensure that views, opinions and suggestions of other independent directors shall be adequately addressed with the Board and (iv) provide that the Chairman, jointly with the Lead Independent Director and the CEO shall determine the times and agendas of Board meetings, and at the beginning of each year, establish a schedule for such meetings.
 
Incorporation by Reference to Form S-3 shelf registration statement

On March 12, 2010, Stanley filed a prospectus supplement to its Form S-3 shelf registration statement relating to common stock to be issued to former employees of Black & Decker upon the exercise of stock options held by such former employees.  Such stock options were issued pursuant to the Black & Decker 1996 Stock Option Plan and the Black & Decker 2003 Stock Option Plan.  Such stock plans are attached hereto as Exhibits 10.6 and 10.7, respectively, for the purpose of incorporating such plans by reference into such Form S-3 shelf registration statement.

 
Item 9.01.  Financial Statements and Exhibits.
 
(a)
  Financial Statements of Business Acquired

The historical audited consolidated financial statements of The Black & Decker Corporation and its subsidiaries required by Item 9.01(a) of Form 8-K are attached as Exhibit 99.3 to this Current Report on Form 8-K and are incorporated herein by reference.

(b)
  Pro Forma Financial Information

The pro forma financial statements required by Item 9.01(b) of Form 8-K will be filed by amendment or otherwise within 71 calendar days after March 18, 2010, the date by which this Current Report must be filed pursuant to General Instruction B.1. of Form 8-K.
 
 

 
(d)
  Exhibits

The exhibits to this current report on Form 8-K are listed in the Exhibit Index, which appears at the end of this report and is incorporated by reference herein.

 
 
 
 
 
 
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
Stanley Black & Decker, Inc.
 
       
March 12, 2010
By:
/s/ Bruce H. Beatt  
    Name: Bruce H. Beatt  
    Title:      Senior Vice President, General Counsel and Secretary  
       
 
 
 
 
 
 

 


Exhibit Index

Exhibit
Description
 
     
2.1
Agreement and Plan of Merger dated as of November 2, 2009, among The Stanley Works, The Black & Decker Corporation and Blue Jay Acquisition Corp., a wholly owned subsidiary of Stanley (incorporated by reference to Exhibit 2.1 of our Current Report on Form 8-K filed on November 3, 2009).
 
     
3.1
Certificate of Amendment to the Restated Certificate of Incorporation of Stanley Black & Decker, Inc. dated as of March 12, 2010.
 
     
3.2
Amended and Restated Bylaws of Stanley Black & Decker, Inc. dated as of March 12, 2010.
 
     
4.1
Second Supplemental Indenture dated as of March 12, 2010 to the Indenture dated as of November 1, 2002 between The Stanley Works and The Bank of New York Mellon Trust Company, as successor trustee to JPMorgan Chase Bank, N.A.
 
     
4.2
Third Supplemental Indenture dated as of March 12, 2010, to the Indenture dated as of November 16, 2006 between The Black & Decker Corporation, and The Bank of New York, as trustee.
 
     
4.3
First Supplemental Indenture dated as of March 12, 2010, to the Indenture dated as of October 18, 2004 between The Black & Decker Corporation and the Bank of New York as trustee.
 
     
4.4
First Supplemental Indenture dated as of March 12, 2010, to the Indenture dated as of June 5, 2001, between The Black & Decker Corporation and the Bank of New York, as trustee.
 
     
4.5
First Supplemental Indenture dated as of March 12, 2010, to the Indenture dated as of June 26, 1998, by and among Black & Decker Holdings, Inc., as issuer, The Black & Decker Corporation, as guarantor and The First National Bank of Chicago, as trustee.
 
     
4.6
Indenture, dated as of November 16, 2006, between The Black & Decker Corporation and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.
 
     
4.6(a) 
First Supplemental Indenture dated as of November 16, 2006, to the Indenture dated as of November 16, 2006 between The Black & Decker Corporation and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.
 
     
4.6(b) 
Second Supplemental Indenture dated as of April 3, 2009, to the Indenture dated as of November 16, 2006 between The Black & Decker Corporation and The Bank of New York Mellon (formerly known as The Bank of New York), as Trustee.
 
     
4.7
Indenture, dated as of October 18, 2004, between The Black & Decker Corporation and The Bank of New York Mellon (formerly known as The Bank of New York), as trustee.
 
     
4.8
Indenture dated as of June 5, 2001, by The Black & Decker Corporation with the Bank of New York, as trustee.
 
     
4.9
Indenture dated as of June 26, 1998, by and among Black & Decker Holdings, Inc., as issuer, The Black & Decker Corporation, as guarantor and The First National Bank of Chicago, as trustee.
 
     
10.1
Executive Chairman Agreement, dated as of November 2, 2009, among The Stanley Works and Nolan D. Archibald (incorporated by reference to Exhibit 10.3 of our Current Report on Form 8-K filed on November 3, 2009).
 
     
10.2
Second Amended and Restated Employment Agreement, dated as of November 2, 2009, among The Stanley Works and John F. Lundgren (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed on November 3, 2009).
 
     
10.3
Employment Agreement, dated as of November 2, 2009, among The Stanley Works and James M. Loree (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed on November 3, 2009).
 
 
 
 
 
10.4
 364-Day Credit Agreement dated as of March 12, 2010, among Stanley Black & Decker, Inc., The Black & Decker Corporation, as Subsidiary Guarantor, and each of the initial lenders named therein, Citibank, N.A., as Administrative Agent, Citigroup Global Markets Inc. and Banc of America Securities LLC, as Lead Arrangers and Book runners, and Bank of America, N.A., as Syndication Agent.
 
     
10.5
Amendment No. 2 to the Amended and Restated Credit Agreement among Stanley Black & Decker (formerly known as The Stanley Works), the Lenders party thereto and Citibank, N.A. as Agent for the Lenders.
 
     
10.6
The Black & Decker 1996 Stock Option Plan, as amended and restated (filed herewith).
 
     
10.7
The Black & Decker 2003 Stock Option Plan, as amended and restated (filed herewith).
 
     
10.8
The Stanley Works Restricted Stock Unit Plan for Non-Employee Directors amended and restated as of December 11, 2007 (incorporated by reference to Exhibit 10(xx) to Annual Report on Form 10-K for the year ended December 29, 2007).
 
     
23.1
Consent of Ernst & Young LLP independent auditor to The Black & Decker Corporation.
 
     
99.1
Amended and Restated Stanley Black & Decker, Inc. Corporate Governance Guidelines dated as of March 12, 2010.
 
     
99.2
Press release dated March 12, 2010, announcing the completion of the Merger.
 
     
99.3
The historical audited consolidated financial statements of The Black & Decker Corporation and its subsidiaries as of the fiscal year ended December 31, 2009.
 
 
 
 
 
 
Exhibit 3.1


CERTIFICATE OF AMENDMENT
 
TO THE
 
RESTATED CERTIFICATE OF INCORPORATION
 
OF
 
THE STANLEY WORKS
 
March 12, 2010
 
The Stanley Works, a corporation organized and existing under the Connecticut Business Corporation Act, does hereby certify:
 
1 :  The name of the corporation is The Stanley Works (the “ Corporation ”).
 
2 :  The Restated Certificate of Incorporation is amended to change the name of the Corporation from “The Stanley Works” to “Stanley Black & Decker, Inc.” and to increase the number of authorized shares of common stock of the Corporation from 200,000,000 to 300,000,000, as set forth below:
 
A.           Section 1 is hereby amended by deleting the name “The Stanley Works” contained therein, and substituting, in lieu thereof, the name “Stanley Black & Decker, Inc.”
 
B.           Section 2 is hereby amended by deleting the phrase “Said Stanley Works shall be and remain a body politic and corporate by the name of The Stanley Works”, and substituting, in lieu thereof, the following:
 
“Said corporation shall be and remain a body politic and corporate by the name of Stanley Black & Decker, Inc.”
 
C.           The first sentence of Section 3 is hereby deleted in its entirety and replaced with the following:
 
“Section 3.  The stock of said corporation shall consist of 310,000,000 shares, divided into 300,000,000 common shares of the par value of $2.50 per share and 10,000,000 preferred shares, without par value.”
 
3 :  The amendment was adopted on March 12, 2010, and shall become effective at 5:00 p.m., Eastern Time, on the date of filing by the Secretary of the State.
 
4 :  The amendment was duly approved by the shareholders in the manner required by sections 33-600 to 33-998 of the Connecticut General Statutes, inclusive, and by the Restated Certificate of Incorporation.
 
[Signature page follows]
 
 

IN WITNESS WHEREOF, this Corporation has caused this Certificate of Amendment to the Restated Certificate of Incorporation to be duly executed as of the date first set forth above.
 
THE STANLEY WORKS
 
By:
   /s/ Bruce H. Beatt
Name:
Bruce H. Beatt
Title:
Vice President, General Counsel and Secretary

 
 
2
 
 
Exhibit 3.2
 
 
 
As amended March12, 2010
 
STANLEY BLACK & DECKER, INC.
BYLAWS
 
ARTICLE I
SHAREHOLDERS’ MEETINGS
 
1.
Annual Meeting .  The Annual Meeting of the shareholders shall be held at such time in each year and at such place within or without the State of Connecticut as the Board of Directors may determine. Notice thereof shall be mailed to each shareholder to his or her last known post office address not less than ten days nor more than sixty days before such Meeting.
 
2.
Special Meetings .  Special Meetings of the shareholders shall be called by the Chairman, or the Chief Executive Officer or Secretary, or by the Chairman, or the Chief Executive Officer or Secretary upon the written request of the holders of not less than 35% of the voting power of all shares entitled to vote on any issue proposed to be considered at such Meeting by mailing a notice thereof to each shareholder to his or her last known post office address not less than twenty-five days nor more than fifty days before such Meeting.
 
3.
Quorum .  At any Meeting of shareholders the holders of not less than a majority of the shares outstanding and entitled to vote present in person or by proxy shall constitute a quorum. The Directors may establish a record date for voting or other purposes in accordance with law.
 
4.
Business to be Conducted at Annual Meeting .  No business may be transacted at an Annual Meeting of shareholders (including any adjournment thereof), other than business that is either (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors (or any duly authorized committee thereof), (b) otherwise properly brought before the Annual Meeting by or at the direction of the Board of Directors (or any duly authorized committee thereof) or (c) otherwise properly brought before the Annual Meeting by any shareholder (i) who is a shareholder of record on the date of the giving of the notice provided for in this Section 4 and on the record date for the determination of shareholders entitled to vote at such Annual Meeting and (ii) who complies with the notice procedures set forth in this Section 4.
 
 
In addition to any other applicable requirements, for business to be properly brought before an Annual Meeting by a shareholder, such shareholder must have given timely notice thereof in proper written form to the Secretary.
 
 
 
 
 
 
To be timely, a shareholder’s notice to the Secretary must be delivered to or mailed and received at the principal executive offices of the Corporation not less than ninety (90) days nor more than one hundred twenty (120) days prior to the anniversary of the date on which the proxy statement was first mailed relating to the immediately preceding Annual Meeting of shareholders; provided , however , that in the event that the Annual Meeting is called for a date that is not within thirty (30) days before or after such anniversary date, in order for a shareholder’s notice to be timely it must be so received not later than the close of business on the tenth (10th) day following the day on which the notice of the date of such Annual Meeting was mailed or public disclosure of the date of such Annual Meeting was made, whichever first occurs. In no event shall the public announcement of an adjournment of an Annual Meeting commence a new time period for the giving of a shareholder’s notice as described above.
 
 
To be in proper written form, a shareholder’s notice to the Secretary must set forth as to each matter such shareholder proposes to bring before the Annual Meeting (i) a brief description of the business desired to be brought before the Annual Meeting and the reasons for conducting such business at the Annual Meeting, including the complete text of any resolutions to be presented at the Annual Meeting with respect to such business, and the reasons for conducting such business at the Annual Meeting, (ii) the name and record address of the shareholder of record proposing such business and any other person on whose behalf the proposal is being made, (iii) the class or series and number of shares of capital stock of the Corporation which are owned beneficially or of record by such shareholder or such other person, (iv) a description of all arrangements or understandings between such shareholder and any such other person or persons in connection with the proposal of such business by such shareholder, (v) a description of any material interest of such shareholder or such other person in such business and (vi) a representation that such shareholder intends to appear in person or by proxy at the Annual Meeting to bring such business before the meeting.
 
 
No business shall be conducted at the Annual Meeting of shareholders except business brought before the Annual Meeting in accordance with the procedures set forth in this Section 4; provided , however , that, once business has been properly brought before the Annual Meeting in accordance with such procedures, nothing in this Section 4 shall be deemed to preclude discussion by any shareholder of any such business. If the Chairman of an Annual Meeting determines that business was not properly brought before the Annual Meeting in accordance with the foregoing procedures, the Chairman shall declare to the meeting that the business was not properly brought before the meeting and such business shall not be transacted.
 
ARTICLE II
NOMINATIONS OF DIRECTOR CANDIDATES
 
1.
Eligibility to Make Nominations .  Nominations of candidates for election as directors of the Corporation at any meeting of shareholders called for election of directors may be made by the Board of Directors (an “ Election Meeting ” ) or at any annual meeting of shareholders by any shareholder entitled to vote at such annual meeting.
 
 
 
2
 
 
 
2.
Procedure for Nominations by the Board of Directors .  Nominations made by the Board of Directors shall be made at a meeting of the Board of Directors, or by written consent of directors in lieu of a meeting, not less than 30 days prior to the date of the Election Meeting, and such nominations shall be reflected in the minute books for the Corporation as of the date made. At the request of the Secretary of the Corporation each proposed nominee shall provide the Corporation with such information concerning himself or herself as is required, under the rules of the Securities and Exchange Commission, to be included in the Corporation’s proxy statement soliciting proxies for his or her election as a director.
 
3.
Procedure for Nominations by Shareholders .  Any shareholder entitled to vote in the election of directors generally may nominate one or more persons for election as directors at an Annual Meeting only if such shareholder has given timely written notice of such shareholder’s intent to make such nomination or nominations. To be timely, a shareholder’s notice to the Secretary must be delivered to or mailed and received at the principal executive offices of the Corporation not less than ninety (90) days nor more than one hundred twenty (120) days prior to the anniversary of the date on which the proxy statement was first mailed relating to the immediately preceding Annual Meeting of shareholders; provided , however , that in the event that the Annual Meeting is called for a date that is not within thirty (30) days before or after such anniversary date, in order for a shareholder’s notice to be timely it must be so received not later than the close of business on the tenth (10th) day following the day on which notice of the date of such Annual Meeting was mailed or public disclosure of the date of such Annual Meeting was made, whichever first occurs. In no event shall the public announcement of an adjournment of an Annual Meeting commence a new time period for the giving of a shareholder’s notice as described above.
 
 
To be in proper written form, a shareholder’s notice to the Secretary must set forth: (i) the name and record address of the shareholder of record making such nomination and any other person on whose behalf the nomination is being made, and of the person or persons to be nominated, (ii) the class or series and number of shares of capital stock of the Corporation which are owned beneficially or of record by such shareholder or such other person, (iii) a description of all arrangements or understandings between such shareholder and any such other person or persons or any nominee or nominees in connection with the nomination by such shareholder, (iv) such other information regarding each nominee proposed by such shareholder as would be required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required to be disclosed, pursuant to the rules of the Securities and Exchange Commission had the nominee been nominated or intended to be nominated by the Board of Directors, and shall include a consent signed by each such nominee to being named in the proxy statement for the Annual Meeting as a nominee and to serve as a director of the Corporation if so elected and (v) a representation that such shareholder intends to appear in person or by proxy at the Annual Meeting to make such nomination.
 
 
3
 
 
 
4.
Substitution of Nominees .  In the event that a person is validly designated as a nominee in accordance with Section 2 of this Article II and shall thereafter become unable or unwilling to stand for election to the Board of Directors, a substitute nominee may be designated by those named as proxies in proxies solicited on behalf of the Board of Directors if the person was designated as nominee in accordance with Section 2 of this Article II.
 
5.
Determination of Compliance with Procedure .  If the Chairman of the Election Meeting or the Annual Meeting determines that a nomination was not in accordance with the foregoing procedures, such nomination shall be void and shall be disregarded.
 
ARTICLE III
DIRECTORS AND COMMITTEES
 
1.
Directors .  The business, property and affairs of this Corporation shall be managed by or under the direction of the Board of Directors consisting of not less than nine nor more than eighteen Directors, the exact number to be determined by the Board of Directors from time to time. All Directors shall be shareholders of record. The Directors shall be divided into three classes designated Class I, Class II and Class III. Such classes shall be as nearly equal in number as the total number of Directors constituting the entire Board of Directors permits. One class shall be chosen annually at the Annual Meeting of shareholders and the members of such class shall hold office until their successors be elected and qualified. The Directors may increase the prescribed number of Directors by the concurring vote of a majority of the prescribed number of Directors. Any increase or decrease in the prescribed number of Directors shall be so apportioned among the classes of Directors as to make all the classes as nearly equal in number as possible. No reduction of the number of Directors shall remove or shorten the term of any Director in office. A majority of the number of Directors prescribed shall constitute a quorum for the transaction of business.
 
2.
Meetings .  The Chairman, the Chief Executive Officer or any Vice Chairman may and upon written application of any three Directors shall call a meeting of the Board of Directors to be held at such time and place as may be determined by the person calling said meeting and shall cause notice thereof to be given. Unless waived in writing, three days verbal or written (mail) notice shall be required provided, however, that if in the judgment of any two officers an emergency exists, a meeting may be called forthwith by telephone or facsimile or verbal notice and such notice shall be deemed sufficient notice notwithstanding that some of the Directors may not have actual notice.
 
The Annual Meeting of the Directors for the election of officers shall be held without notice, immediately after the Annual Meeting of shareholders. Regular meetings of the Directors shall be held at least on a quarterly basis.
 
3.
Written Consent .  If all the Directors, or all members of a committee of the Board of Directors, as the case may be, severally or collectively consent in writing to any action taken or to be taken by the Corporation, and the number of such Directors or members constitutes a quorum for such action, such action shall be a valid corporate action as though it had been authorized at a meeting of the Board of Directors or committee, as the case may be. The Secretary shall file such consents with the minutes of the Board of Directors or of the committee, as the case may be.
 
 
 
4
 
 
 
4.
Participation by Telephone .  A Director may participate in a meeting of the Board of Directors or of a committee by any means of communication by which all Directors participating in the meeting may simultaneously hear one another during the meeting, and participation in a meeting pursuant to this subsection shall constitute presence in person at such meeting.
 
5.
Vacancies .  In case any vacancy or vacancies shall exist in the Board of Directors at any time the remaining members of the Board by majority action may fill the vacancy or vacancies. The term of a Director elected to fill a vacancy expires at the next shareholders meeting at which Directors are elected.
 
6.
Committees .  The Board of Directors may from time to time appoint from its membership such committees as it may deem necessary or desirable for the best interests of the Corporation and may delegate to any committee all needful authority to the extent permitted by law. The meetings of all committees are open to all directors. Each committee shall fix its own rules as to procedure and calling of meetings. It shall appoint a Secretary, who need not be a member of the committee. Such Secretary shall call meetings of the committee on the request of the Chair of the committee or any two members and shall keep permanent record of all of its proceedings. A majority of the members of any committee shall constitute a quorum.
 
7.
Executive Committee .  The Directors shall appoint an Executive Committee consisting of the Chairman, if any, the Chief Executive Officer (if he shall also be a Director). the  Lead Independent Director and at least two other Directors, but in no event shall the Committee consist of less than five members. The Board of Directors may at any time decrease (subject to the provisions of the preceding paragraph) or increase the size of said Committee, may change the membership thereof and may fill vacancies therein.
 
 
During intervals between meetings of the Board of Directors, the Executive Committee shall possess and may exercise all the powers of the Board of Directors in the management of the business and affairs of the Corporation, but the Committee shall have no power to declare dividends or do other things specially reserved by law to the Directors. The Executive Committee shall have power to appoint such subcommittees as it may deem necessary to report and make recommendations to the Executive Committee. Any action taken by the Executive Committee shall be subject to change, alteration and revision by the Board of Directors, provided that no rights or acts of others shall be affected by any such alteration or revision.
 
 
5
 
 
8.
Finance and Pension Committee .  A Finance and Pension Committee consisting of at least three Directors shall be appointed by the Board of Directors. The Committee shall advise and assist the Chief Financial Officer and the Treasurer in major matters concerning the finances of the Corporation and in matters of major policy decisions in the purchase and sale of securities. In performance of this the Committee shall regularly review the financial condition of the Corporation so as to counsel these officers and the Board on the total financial resources, strength and capabilities of the Corporation. In this connection, the Committee shall analyze and advise on fundamental corporate changes in capital structure (both debt and equity); review the capital structure of the Corporation and make recommendations with respect to management proposals concerning financing, purchases of treasury stock, investments, and dividend actions; review periodically the Corporation’s risk management program and its adequacy to safeguard the Corporation against extraordinary liabilities or losses; and advise and assist in matters such as short-term investments, credit liabilities, financings, and hedges of foreign currency exposures.
 
 
The Committee shall oversee the Corporation’s administration of its pension plans and of the pension plans of its subsidiaries. The Committee shall be responsible for setting (subject to the approval of the Board of Directors) the retirement policies of the Corporation and its subsidiaries; for amending pension plans, savings and retirement plans, stock ownership plans or any similar plans or related trust agreements; and for approving actuarial assumptions and investment policies for the Corporation’s pension plans. It shall report at least annually to the Board of Directors. The Committee may delegate any or all of these functions to such employees as it, in its judgment, deems appropriate.
 
 
Specifically, the Committee shall approve retaining or terminating the services of actuaries, lawyers, accountants or other professionals for the plans; shall approve annually the amount of the contributions to be made by the Corporation to the respective plans; and shall approve appointing and terminating trustees and investment managers and determine the allocation of the assets of the plans among one or more trustees or investment managers.
 
9.
Audit Committee .  An Audit Committee consisting of at least three Directors shall be appointed by the Board of Directors. Except as permitted by the independence requirements of the New York Stock Exchange, none of the Audit Committee members shall be officers or employees of the Corporation or any of its affiliates. Audit Committee members shall have no relationship to the Corporation that may interfere with the exercise of their independence from management and the Corporation. Each member of the Audit Committee shall be financially literate and at least one member shall have accounting or related financial management expertise, as such qualifications are interpreted by the Corporation’s Board of Directors in its business judgment.
 
 
The responsibilities of the Audit Committee shall be to:
 
 
(a)
Meet with the independent auditor prior to the audit to review the plan and scope of the audit; meet with management and the independent auditor to review the audited financial statements, including major issues and developments regarding financial reporting and accounting matters; and review the management letter prepared by the independent auditor and management’s responses.
 
 
 
6
 
 
 
 
(b)
Discuss with the independent auditor the matters required to be discussed on an annual or quarterly basis, as the case may be, under generally accepted auditing standards and any other applicable laws or regulations relating to the conduct of the audit.
 
 
(c)
Meet periodically with management and the independent and internal auditors to review the adequacy of the Corporation’s system of internal controls over financial reporting and the safeguarding of assets and review significant risk and control exposures and the steps being taken by management to monitor such exposures.
 
 
(d)
Recommend to the Board of Directors the appointment of the independent auditor, subject to shareholder approval, which firm is ultimately accountable to the Audit Committee and the Board of Directors; approve the fees to be paid to the independent auditor; receive and review with the independent auditor periodic reports regarding the auditor’s independence and if so determined by the Audit Committee, recommend that the Board of Directors take appropriate action to satisfy itself of the independence of the auditor; and evaluate the performance of the independent auditor and, if so determined by the Audit Committee, recommend that the Board of Directors replace the independent auditor.
 
 
(e)
Periodically review the audit plan, the internal audit department responsibilities, budget, resources, skills and staffing; concur in the appointment or replacement of the Director of Internal Audit; review at least annually a summary of audit findings prepared by the internal auditing department and management’s responses.
 
 
(f)
Review with the Corporation’s General Counsel the Corporation’s legal compliance, including the Business Conduct Guidelines and legal, regulatory or compliance matters that may have a material impact on the financial statements.
 
 
(g)
Evaluate the adequacy of the Corporation’s Audit Committee Charter annually and recommend any changes to the Board of Directors for adoption.
 
 
(h)
Perform any other oversight functions as requested by the Board of Directors.
 
10.
Compensation and Organization Committee .  A Compensation and Organization Committee consisting of at least three Directors, none of whom shall be employees of the Corporation or any of its subsidiaries, shall be appointed by the Board of Directors. The Committee shall review and approve major organization and compensation structure changes as recommended by Management. Although the Board, itself, will review the performance of the chief executive officer and fix his or her salary, the Committee shall approve the performance and determine the salaries of the other executive officers of the Corporation and of other senior executives whose base salary exceeds an amount fixed by the Board of Directors; shall determine the compensation of all executive officers and such senior executives under the Corporation’s senior executive compensation plans; shall administer all of the Corporation’s senior executive compensation plans; and shall assure that there is a succession plan in place.
 
 
7
 
 
 
11.
Corporate Governance Committee .  A Corporate Governance Committee consisting of at least three directors, none of whom shall be employees of the Corporation or any of its subsidiaries, shall be appointed by the Board of Directors. The Committee shall consider and make recommendations to the Board of Directors as to Board of Director membership with respect to names generated by the Committee itself or submitted by shareholders. The Committee shall consider and make recommendations to the Board of Directors with respect to Board of Director committee membership and chair assignments. (These will normally be acted upon by the Board of Directors at its Annual Meeting held immediately after the Annual Meeting of shareholders.) The Committee shall consider and make recommendations to the Board of Directors with respect to the number of members of the Board of Directors. (The Charter and Bylaws provide for not less than eight nor more than eighteen as may be determined by the Board). Annually, the Committee shall consider and recommend to the Board of Directors the persons whom the Committee proposes that the Board of Directors nominate for election as directors at the Annual Meeting of shareholders. The Committee shall consider and make recommendations to the Board of Directors with respect to remuneration of directors.
 
 
The Committee shall provide guidance to the Management on major issues in areas of corporate social responsibility, including environmental issues and public affairs. The Committee shall review and approve policy guidelines to be used by Management in making charitable contributions and shall annually review all charitable contributions made by the Corporation during the previous twelve months and recommend to the Board the level of contributions to be set for the ensuing year.
 
12.
In the absence of any one or more members from a meeting of any of the committees provided for in these Bylaws, the Chairman, or the Chief Executive Officer or the Lead Independent Director, may in his or her discretion invite any member or members of the Board (otherwise qualified to serve) to attend such meeting. Temporary members thus appointed to attend for absentees shall act as regular members and shall have the right to vote.
 
13.
Powers of All Committees .  The powers of all committees are at all times subject to the control of the Directors, and any member of any committee may be removed at any time at the pleasure of the Board.
 
 
 
8
 
ARTICLE IV
OFFICERS
 
1.
Election of Officers .  The Board of Directors shall have power to elect from its own members or otherwise a Chairman, a Lead Independent Director, a  President, a Chief Executive Officer,  one or more Vice Chairmen and Vice Presidents, a Secretary, a Treasurer, one or more Assistant Treasurers and Assistant Secretaries, and such other officers, agents and employees as it may deem expedient, and to define the duties and authority of all officers, employees and agents and to delegate to them such lawful powers as may be deemed advisable.
 
 
The officers shall respectively perfonn all acts and duties required of such officers by law, by the Charter and Bylaws of this Corporation, or by the Board of Directors.
 
2.
Chairman of the Board .  If the Directors have elected a Chairman, the Chairman shall preside at all meetings of the Board, except that in the Chairman’s absence, the Chief Executive Officer (if he shall be a Director) shall preside. The Chairman shall have such additional duties as the Board of Directors or the Executive Committee may assign.
 
3.
Lead Independent Director .   If the Directors have elected a Lead Independent Director,  the Lead Independent Director shall preside at all meetings of the Board in the absence of the Chairman and the Chief Executive Officer (if the Chief Executive Officer shall be a Director), including, if the Chairman shall be a non-management Director. all meetings  held in executive session. In the absence of the Lead Independent Director. the other  Directors present shall designate a person to preside. The Lead Independent Director shall have such additional duties as the Board of Directors or the Executive Committee  may assign.
 
4.
President .  The President shall be elected by the Directors and shall have such duties as the Board of Directors or the Executive Committee may assign.
 
5.
Chief Executive Officer .  One of the officers shall be appointed Chief Executive Officer of the Corporation by the Board of Directors. Subject to the Board of Directors and the Executive Committee, the Chief Executive Officer shall have general supervision and control of the policies, business and affairs of the Corporation.
 
6.
Vice Chairmen .  Each Vice Chairman shall have such powers and perform such duties as may be conferred upon him or her or determined by the Chief Executive Officer.
 
7.
Vice Presidents .  Each Vice President shall have such powers and perform such duties as may be conferred upon him or her or determined by the Chief Executive Officer.
 
 
 
9
 
 
 
8.
Treasurer .  The Treasurer shall have the oversight and control of the funds of the Corporation and shall have the power and authority to make and endorse notes, drafts and checks and other obligations necessary for the transaction of the business of the Corporation except as herein otherwise provided.
 
9.
Controller .  The Controller shall have the oversight and control of the accounting records of the Corporation and shall prepare such accounting reports and recommendations as shall be appropriate for the operation of the Corporation.
 
10.
Secretary .  It shall be the duty of the Secretary to make and keep records of the votes, doings and proceedings of all meetings of the shareholders and Board of Directors of the Corporation, and of its Committees, and to authenticate records of the Corporation.
 
11.
Assistant Treasurers .  The Assistant Treasurers shall have such duties as the Treasurer shall determine.
 
12.
Assistant Secretaries .  The Assistant Secretaries shall have such duties as the Secretary shall determine.
 
13.
Powers of All Officers .  The powers of all officers are at all times subject to the control of the Directors, and any officer may be removed at any time at the pleasure of the Board.
 
ARTICLE V
INDEMNIFICATION
 
To the extent properly permitted by law the Board of Directors shall provide for the indemnification and reimbursement of, and advances of expenses to, any person made a party to any action, suit or proceeding by reason of the fact that he or she, or a person whose legal representative or successor he or she is,
 
 
(a)
is or was a Director, officer, employee or agent of the Corporation, or
 
 
(b)
served at the corporation’s request as a director, officer, employee or agent of another  corporation,
 
 
 
for expenses, including attorney’s fees, and such amount of any judgment, money decree, fine, penalty or settlement for which he or she may have become liable as the Board of Directors deems reasonable, actually incurred by him or her in connection with the defense or reasonable settlement of any such action, suit or proceeding or any appeal therein.
 
This provision of indemnification shall be in addition to any other right or remedy which such person may have. The Corporation shall have the right to intervene in and defend all such actions, suits or proceedings brought against any such person.
 
 
 
10
 
 
ARTICLE VI
CORPORATE SEAL
 
 
The corporate seal shall be in the custody of the Secretary and either the Secretary or any other officer shall have the power to affix the same for the Corporation.
 
ARTICLE VII
STOCK CERTIFICATES
 
1.
Signatures .  Certificates of stock shall be signed by the Chairman, the President or a Vice President and by the Secretary or the Treasurer (except that where any such certificate is signed by a transfer agent or transfer clerk and by the registrar, the signatures of any such Chairman, President, Vice President, Secretary or Treasurer may be facsimiles, engraved or printed) and shall be sealed with the seal of the corporation (or shall bear a facsimile of such seal).
 
2.
Lost Certificates .  No certificate for shares of stock in the Corporation shall be issued in place of any certificate alleged to have been lost, stolen or destroyed except upon production of such evidence of such loss, theft or destruction as the Board of Directors in its discretion may require and upon delivery to the Corporation of a bond of indemnity in form and, unless such requirement is waived by Resolution of the Board, with one or more sureties, satisfactory to the Board in at least double the value of the stock represented by said Certificate.
 
ARTICLE VIII
FISCAL YEAR
 
 
The Corporation’s fiscal year shall close on the Saturday nearest December 31st of each year.
 
ARTICLE IX
INDEPENDENT AUDIT
 
 
The Board of Directors shall provide for a yearly independent audit, the form and scope of which shall be determined by the Board from time to time.
 
ARTICLE X
AMENDMENTS
 
 
The Board of Directors of the Corporation may adopt, amend or repeal the Bylaws of the Corporation, subject, however, to the power of the shareholders to adopt, amend or repeal the same, provided that any notice of a meeting of shareholders or of the Board of Directors at which Bylaws are to be adopted, amended or repealed, shall include notice of such proposed action.
 
 
 
 
 
11
 
 
 
ARTICLE XI
ACQUISITIONS OF STOCK
 
 
 
(a)
Except as set forth in subsection (b) hereof, the Corporation shall not acquire any of its voting equity securities (as defined below) at a price per share above the market price per share (as defined below) of such securities on the date of such acquisition from any person actually known by the Corporation to be the beneficial owner (as determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as amended, or any successor rule or regulation) of more than three percent of the Corporation’s voting equity securities who has been the beneficial owner of the Corporation’s voting equity securities for less than two years prior to the date of the Corporation’s acquisition thereof, unless such acquisition (i) has been approved by a vote of a majority of the shares entitled to vote, excluding shares owned by any beneficial owner any of whose shares are proposed to be acquired pursuant to the proposed acquisition that is the subject of such vote or (ii) is pursuant to an offer made on the same terms to all holders of securities of such class. The determination of the Board of Directors shall be conclusive in determining the price paid per share for acquired voting equity securities if the Corporation acquires such securities for consideration other than cash.
 
 
(b)
This provision shall not restrict the Corporation from: (i) acquiring shares in the open market in transactions in which there has been no prior arrangement with, or solicitation of (other than a solicitation publicly made to all holders), any selling holder of voting equity securities or in which all shareholders desiring to sell their shares have an equal chance to sell their shares; (ii) offering to acquire shares of shareholders owning less than 100 shares of any class of voting equity securities; (iii) acquiring shares pursuant to the terms of a stock option or similar plan that has been approved by a vote of a majority of the Corporation’s common shares represented at a meeting of shareholders and entitled to vote thereon; (iv) acquiring shares from, or on behalf of, any employee benefit plan maintained by the Corporation or any subsidiary or any trustee of, or fiduciary with respect to, any such plan when acting in such capacity; or (v) acquiring shares pursuant to a statutory appraisal right or otherrvise as required by law.
 
 
(c)
Market price per share on a particular day means the highest sale price on that day or during the period of five trading days immediately preceding that day of a share of such voting equity security on the Composite Tape for New York Stock Exchange-Listed Stocks, or if such voting equity security is not quoted on the Composite Tape on the New York Stock Exchange or listed on such Exchange, on the principal United States securities exchange registered under the Securities Exchange Act of 1934 on which such voting equity security is listed, or, if such voting equity security is not listed on any such exchange, the highest sales price or, if sales price is not reported, the highest closing bid quotation with respect to a share of such voting equity security on that day or during the period of five trading days immediately preceding that day on the National Association of Securities Dealers, Inc. Automated Quotations System or any system then in use, or if no such quotations are available, the fair market value on the date in question of a share of such voting equity security as determined by a majority of the Board of Directors.
 
 
 
12
 
 
 
 
(d)
Voting equity securities of the Corporation means equity securities issued from time to time by the Corporation which by their terms are entitled to be voted generally in the election of the directors of the Corporation.
 
 
(e)
The Board of Directors shall have the power to interpret the terms and provisions of, and make any determinations with respect to, this Article XI, which interpretations and determinations shall be conclusive.
 
 
 
 
13
 
 
Exhibit 4.1
 
 
 
 
 
STANLEY BLACK & DECKER, INC.
 
AND
 
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
 
as Trustee
 
AND
 
THE BLACK AND DECKER CORPORATION
 
as Guarantor
                
 
 
SECOND SUPPLEMENTAL INDENTURE
 
to the
 
INDENTURE
 
dated as of November 1, 2002
 
 
 
Dated as of March 12, 2010
 
 
 
 
 
 
 

THIS SECOND SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 12, 2010, is among STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “Company”), THE BLACK & DECKER CORPORATION, a Maryland corporation (the “Guarantor”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as successor trustee to JPMorgan Chase Bank, N.A. (formerly known as JPMorgan Chase Bank), as trustee (the “Trustee”).
 
Witnesseth:
 
WHEREAS, the Company has executed and delivered to the Trustee an Indenture, dated as of November 1, 2002 (as heretofore supplemented and amended, the “Indenture”) between the Company and the Trustee, providing for the issuance from time to time of one or more series of Securities;
 
WHEREAS, the Company has heretofore issued (a) $250,000,000 aggregate principal amount of 6.15% Notes due 2013, (b) $199,527,000 aggregate principal amount of 4 9/10% Series B Senior Notes due 2012, (c) $473,000 aggregate principal amount of 4 9/10% Series A Senior Notes due 2012, (d) $200,000,000 aggregate principal amount of 5.00% Notes due 2010 and (e) $330,000,000 aggregate principal amount of convertible notes due 2012, in each case under the Indenture (to the extent such securities are outstanding on the date hereof, collectively, the “Outstanding Notes”);
 
WHEREAS, on the date hereof, the Company will acquire the Guarantor pursuant to that certain Agreement and Plan of Merger, dated as of November 2, 2009, among the Company, the Guarantor and Blue Jay Acquisition Corp., the Guarantor will become a wholly-owned subsidiary of the Company and the Guarantor will provide a full and unconditional guarantee (the “Guarantee”) of the obligations of the Company under the Outstanding Notes;
 
WHEREAS, pursuant to Section 9.1(2) of the Indenture, the Company (when authorized by or pursuant to a Board Resolution) and the Trustee may enter into a supplemental indenture, without the consent of any Holders of Securities or Coupons, to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities;
 
WHEREAS, the Company proposes to amend the Indenture as hereinafter in this Supplemental Indenture provided (the “Amendment”);
 
WHEREAS, this Supplemental Indenture has been duly authorized by a Board Resolution and all other necessary corporate action on the part of the Company and the Guarantor; and
 
WHEREAS, the Company has requested that the Trustee join the Company and the Guarantor in the execution and delivery of this Supplemental Indenture.
 
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
 
 
 
 
 
 
The Amendment shall become effective upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee.
 
ARTICLE 1

GUARANTEE
 
Section 1.1 .         Amendments to Indenture.
 
The following Sections 12.1 through and including Section 12.8 shall amend and replace Article 12 of the Indenture in its entirety, and shall hereinafter be deemed a part of the Indenture and applicable to each series of the Outstanding Notes.  The following definition shall apply to Article 12 of the Indenture, as amended hereby: “Guarantor” shall mean The Black & Decker Corporation, a Maryland Corporation.
 
Section 12.1.          Guarantees .
 
With respect to each series of Securities to which this Article 12 is expressly made applicable, the Guarantor hereby unconditionally and irrevocably guarantees to each Holder and to the Trustee and its successors and assigns (i)(a) the full and punctual payment of principal and interest on the Securities of such Holder when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company to the Holders and the Trustee under this Indenture and the Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture and the Securities and (ii) in the case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal (all of the foregoing being hereinafter collectively called the “Guarantees”).
 
The Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guarantees and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Securities or the Guarantees.  The Guarantees hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person under this Indenture, the Securities or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Securities or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Guarantees or any of them; (e) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guarantees or (f) any change in the ownership of the Guarantor.
 
The Guarantor further agrees that its Guarantees hereunder constitute a guarantee of payment, performance and compliance when due (and not a guarantee of collection).
 
 
 
2
 
 
The Guarantor hereby agrees that its obligations hereunder shall be as principal and not merely as surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or failure to enforce the provisions of any Security or this Indenture, or any waiver, modification, consent or indulgence granted to the Company with respect thereto (unless the same shall also be provided the Guarantor), by the Holder of any Security or the Trustee, the recovery of any judgment against the Company or any action to enforce the same, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided that, notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall, without the consent of the Guarantor, increase the principal amount of a Security or the interest rate thereon or increase any premium payable upon redemption thereof.  The Guarantees shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guarantees or otherwise.  Without limiting the generality of the foregoing, the Guarantor covenants that the Guarantees shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.
 
The Guarantor further agrees that the Guarantees shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal, premium, if any, or interest on any Security is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
 
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay the principal of, premium on, if any, or interest on any Security when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other obligation under the Securities, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such obligations under such Securities, (ii) accrued and unpaid interest on such obligations under such Securities (but only to the extent not prohibited by law) and (iii) all other monetary obligations with respect to such Securities of the Company to the Holders and the Trustee.
 
The Guarantor will be subrogated to all rights of the Holders against the Company in respect of any amount paid by the Guarantor pursuant to the provisions of the Guarantee; provided, however, that the Guarantor shall not be entitled to enforce, or to receive any payments arising out of or based upon, such right of subrogation until the principal of, premium on, if any, and interest on such Securities shall have been paid in full. The Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations with respect to the Securities hereby may be accelerated as provided herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations with respect to such Securities, and (y) in the event of any declaration of acceleration of such obligations as provided herein, the Guarantees (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Article 12.
 
 
 
3
 
 
 
The Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Article 12.
 
Section 12.2.          Successors and Assigns .
 
This Article 12 shall be binding upon the Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
 
Section 12.3.          No Waiver .
 
Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 12 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 12 at law, in equity, by statute or otherwise.
 
Section 12.4.          Modification .
 
No modification, amendment or waiver of any provision of this Article 12, nor the consent to any departure by the Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstances.
 
Section 12.5.          Notation of Guarantee Not Required .
 
The Guarantor hereby agrees that the Guarantee set forth in this Article 12 shall remain in full force and effect notwithstanding the absence on any Security of a notation relating to the Guarantee.
 
Section 12.6.          Benefits Acknowledged .
 
The Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the guarantee and waivers made by it pursuant to its Guarantee are knowingly made in contemplation of such benefits.
 
 
 
4
 
 
 
Section 12.7.          Release of Guarantee .
 
Provided that no notice that an Event of Default has occurred and is continuing has been delivered to the Holders, the Guarantee shall be automatically and unconditionally released and discharged, and no further action by the Guarantor, the Company or the Trustee is required for the release of the Guarantee, upon the Company delivering to the Trustee an Officer’s Certificate stating that the Guarantee is released in full.
 
Section 12.8.          Limitation on Guarantor Liability .
 
The Guarantor, and by its acceptance of Securities, each Holder, hereby confirms that it is the intention of all such parties that the Guarantee of the Guarantor not constitute a fraudulent transfer or conveyance for purposes of Title 11, U.S. Code or any similar federal or state law for the relief of debtors, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to the Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantor hereby irrevocably agree that the obligations of the Guarantor shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws and after giving effect to any collections from, result in the obligations of the Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law.
 
ARTICLE 2
 
MISCELLANEOUS
 
Section 2.1.          Effect of Guarantee; Guarantor to be Bound by Indenture.
 
The Guarantor hereby irrevocably, fully and unconditionally Guarantees to each Holder of Outstanding Notes and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, any Outstanding Notes or the obligations of the Company under the Indenture or any Outstanding Notes, the obligations of the Company with respect to payment and performance of each Outstanding Note and the other obligations of the Company under the Indenture with respect to the Outstanding Notes on the terms, and subject to the conditions, contained in Article 12 of the Indenture (as amended by this Supplemental Indenture) and agrees to be bound by all other terms of the Indenture.
 
Section 2.2 .         Effect of Supplemental Indenture.
 
Upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee, the Indenture and each of the Outstanding Notes shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Outstanding Notes heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby.
 
 
 
 
5
 
 
 
Section 2.3 .         Ratification of Indenture.
 
Except as supplemented hereby, all provisions in the Indenture and each of the Outstanding Notes shall remain in full force and effect.  This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture, the Outstanding Notes and this Supplemental Indenture shall henceforth be read and construed together.  The Indenture and the Outstanding Notes, as supplemented by this Supplemental Indenture, shall in all respects remain in full force and effect.
 
Section 2.4 .         Trustee Not Responsible For Recitals.
 
The recitals herein contained are made by the Company and the Guarantor and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
 
Section 2.5 .         Conflict with Trust Indenture Act.
 
If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern any provision of this Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
 
Section 2.6 .         Terms Defined in the Indenture.
 
All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
 
Section 2.7 .         New York Law to Govern.
 
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF TO THE EXTENT A DIFFERENT LAW WOULD GOVERN AS A RESULT.
 
Section 2.8.         Severability.
 
In case any one or more of the provisions contained in this Supplemental Indenture, or in the Indenture or Outstanding Notes as supplemented by this Supplemental Indenture, shall for any reason be held to be invalid, illegal or unenforceable in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture, the Indenture or the Outstanding Notes, but this Supplemental Indenture, the Indenture and the Outstanding Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
 
 
6
 
 
Section 2.9.         Counterparts.
 
This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
 
 
7
 

 
IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed as of the day and year first above written.
 
 
 
 
 
STANLEY BLACK & DECKER, INC.
 
       
 
By:
/s/  Craig A. Douglas  
    Name:   Craig A. Douglas   
    Title:     Vice President and Treasurer  
       
 
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/  Mark M. Rothleitner    
    Name:   Mark M. Rothleitner   
    Title:     Assistant Treasurer  
       
 
 
 
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
 
       
 
By:
/s/  Lawrence M. Kusch      
    Name:   Lawrence M. Kusch    
    Title:     Vice President  
       
 
 
 
Exhibit 4.2
 
 
 

 
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK MELLON
 
as Trustee
 
 
THIRD SUPPLEMENTAL INDENTURE
 
to the
 
INDENTURE
 
dated as of November 16, 2006
 
 
 
Dated as of March 12, 2010

 
 
 
 
 
 
 
THIS THIRD SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 12, 2010, is among THE BLACK & DECKER CORPORATION, a Maryland corporation (the “Company”), STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “Guarantor”), and THE BANK OF NEW YORK MELLON (formerly known as The Bank of New York), as trustee (the “Trustee”).
 
Witnesseth:
 
WHEREAS, the Company has executed and delivered to the Trustee an Indenture, dated as of November 16, 2006, between the Company and the Trustee (as amended, the “Indenture”), providing for the issuance from time to time of one or more series of Debt Securities;
 
WHEREAS, the Trustee has heretofore authenticated, and the Company has heretofore issued, (a) $300,000,000 aggregate principal amount of 5.75% Notes due 2016 (the “2016 Notes”) and (b) $350,000,000 aggregate principal amount of 8.95% Notes due 2014 (the “2014 Notes”), in each case under the Indenture (collectively, the “Outstanding Notes”);
 
WHEREAS, on the date hereof, a wholly-owned subsidiary of the Guarantor will merge with and into the Company with the Company as the survivor pursuant to that certain Agreement and Plan of Merger, dated as of November 2, 2009, among the Company, the Guarantor and Blue Jay Acquisition Corp., the Company will become a wholly-owned subsidiary of the Guarantor and the Guarantor will provide a full and unconditional guarantee (the “Guarantee”) of the obligations of the Company under the Outstanding Notes;
 
WHEREAS, pursuant to Section 9.1(c) of the Indenture, the Trustee and the Company are authorized to enter into a supplemental indenture, without prior notice to or consent of any Holders of the Outstanding Notes, to add guarantees with respect to any series of Debt Securities;
 
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company and the Guarantor; and
 
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
The amendment set forth below shall become effective upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee.
 
ARTICLE 1
 
GUARANTEE
 
Section 1.1.            Amendments to Indenture.
 
The following Sections 11.1 through and including Section 11.8 shall be added as a new Article 11 of the Indenture, and shall hereinafter be deemed a part of the Indenture and applicable to each series of the Outstanding Notes.  The following definition shall apply to Article 11 of the Indenture, as amended hereby: “Guarantor” shall mean Stanley Black & Decker, Inc., a Connecticut Corporation.
 
 
 
 
 
 
Section 11.1.            Guarantees .
 
With respect to each series of Debt Securities to which this Article 11 is expressly made applicable, the Guarantor hereby unconditionally and irrevocably guarantees to each Holder and to the Trustee and its successors and assigns (i)(a) the full and punctual payment of principal and interest on the Debt Securities of such Holder when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company to the Holders and the Trustee under this Indenture and the Debt Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture and the Debt Securities and (ii) in the case of any extension of time of payment or renewal of any Debt Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal (all of the foregoing being hereinafter collectively called the “Guarantees”).
 
The Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guarantees and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Debt Securities or the Guarantees.  The Guarantees hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person under this Indenture, the Debt Securities or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Debt Securities or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Guarantees or any of them; (e) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guarantees or (f) any change in the ownership of the Guarantor.
 
The Guarantor further agrees that its Guarantees hereunder constitute a guarantee of payment, performance and compliance when due (and not a guarantee of collection).
 
The Guarantor hereby agrees that its obligations hereunder shall be as principal and not merely as surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or failure to enforce the provisions of any Debt Security or this Indenture, or any waiver, modification, consent or indulgence granted to the Company with respect thereto (unless the same shall also be provided the Guarantor), by the Holder of any Debt Security or the Trustee, the recovery of any judgment against the Company or any action to enforce the same, or any other  circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided that, notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall, without the consent of the Guarantor, increase the principal amount of a Debt Security or the interest rate thereon or increase any premium payable upon redemption thereof.  The Guarantees shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guarantees or otherwise.  Without limiting the generality of the foregoing, the Guarantor covenants that the Guarantees shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Debt Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.
 
 
 
2
 
 
 
The Guarantor further agrees that the Guarantees shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal, premium, if any, or interest on any Debt Security is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
 
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay the principal of, premium on, if any, or interest on any Debt Security when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other obligation under the Debt Securities, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such obligations under such Debt Securities, (ii) accrued and unpaid interest on such obligations under such Debt Securities (but only to the extent not prohibited by law) and (iii) all other monetary obligations with respect to such Debt Securities of the Company to the Holders and the Trustee.
 
The Guarantor will be subrogated to all rights of the Holders against the Company in respect of any amount paid by the Guarantor pursuant to the provisions of the Guarantee; provided, however, that the Guarantor shall not be entitled to enforce, or to receive any payments arising out of or based upon, such right of subrogation until the principal of, premium on, if any, and interest on such Debt Securities shall have been paid in full. The Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations with respect to the Debt Securities hereby may be accelerated as provided herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations with respect to such Debt Securities, and (y) in the event of any declaration of acceleration of such obligations as provided herein, the Guarantees (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Article 11.
 
The Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Article 11.
 
Section 11.2.            Successors and Assigns .
 
This Article 11 shall be binding upon the Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Debt Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
 
 
 
 
 
 
 
3
 
 
Section 11.3.             No Waiver .
 
Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 11 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 11 at law, in equity, by statute or otherwise.
 
Section 11.4.            Modification .
 
No modification, amendment or waiver of any provision of this Article 11, nor the consent to any departure by the Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstances.
 
Section 11.5.            Notation of Guarantee Not Required .
 
The Guarantor hereby agrees that the Guarantee set forth in this Article 11 shall remain in full force and effect notwithstanding the absence on any Debt Security of a notation relating to the Guarantee.
 
Section 11.6.            Benefits Acknowledged .
 
The Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the guarantee and waivers made by it pursuant to its Guarantee are knowingly made in contemplation of such benefits.
 
Section 11.7.            Release of Guarantee .
 
Provided that no notice that a Default or Event of Default has occurred and is continuing has been delivered to the Holders, the Guarantee shall be automatically and unconditionally released and discharged, and no further action by the Guarantor, the Company or the Trustee is required for the release of the Guarantee, upon the Company delivering to the Trustee an Officers’ Certificate stating that the Guarantee is released in full.
 
Section 11.8.            Limitation on Guarantor Liability .
 
The Guarantor, and by its acceptance of Debt Securities, each Holder, hereby confirms that it is the intention of all such parties that the Guarantee of the Guarantor not constitute a fraudulent transfer or conveyance for purposes of Title 11, U.S. Code or any similar federal or state law for the relief of debtors, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to the Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the
 
 
 
4
 
 
 
Guarantor hereby irrevocably agree that the obligations of the Guarantor shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws and after giving effect to any collections from, result in the obligations of the Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law.
 
ARTICLE 2
 
MISCELLANEOUS
 
Section 2.1.            Effect of Guarantee; Guarantor to be Bound by Indenture.
 
The Guarantor hereby irrevocably fully and unconditionally Guarantees to each Holder of Outstanding Notes and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, any Outstanding Notes or the obligations of the Company under the Indenture or any Outstanding Notes, the obligations of the Company with respect to payment and performance of each Outstanding Note and the other obligations of the Company under the Indenture with respect to the Outstanding Notes on the terms, and subject to the conditions, contained in Article 11 of the Indenture (as amended by this Supplemental Indenture) and agrees to be bound by all other terms of the Indenture.
 
Section 2.2.            Effect of Supplemental Indenture.
 
Upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee, the Indenture and each of the Outstanding Notes shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Outstanding Notes heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby.
 
Section 2.3 .            Ratification of Indenture.
 
Except as supplemented hereby, all provisions in the Indenture and each of the Outstanding Notes shall remain in full force and effect.  This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture, the Outstanding Notes and this Supplemental Indenture shall henceforth be read and construed together.  The Indenture and the Outstanding Notes, as supplemented by this Supplemental Indenture, shall in all respects remain in full force and effect.
 
Section 2.4 .            Trustee Not Responsible For Recitals; Reaffirmation of Indemnity.
 
(a)   The recitals herein contained are made by the Company and the Guarantor and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
 
 
 
5
 
 
 
(b)   The Company hereby reaffirms its indemnification obligations to the Trustee pursuant to Section 7.7 of the Indenture in connection with the Trustee’s execution of this Supplemental Indenture.
 
Section 2.5 .            Conflict with Trust Indenture Act.
 
If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern any provision of this Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
 
Section 2.6 .            Terms Defined in the Indenture.
 
All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
 
Section 2.7 .            New York Law to Govern.
 
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF TO THE EXTENT A DIFFERENT LAW WOULD GOVERN AS A RESULT.
 
Section 2.8 .            Severability.
 
In case any one or more of the provisions contained in this Supplemental Indenture, or in the Indenture or Outstanding Notes as supplemented by this Supplemental Indenture, shall for any reason be held to be invalid, illegal or unenforceable in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture, the Indenture or the Outstanding Notes, but this Supplemental Indenture, the Indenture and the Outstanding Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
Section 2.9 .            Counterparts.
 
This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
*   *   *   *   *
 
 
 
6
 

 
 
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed as of the day and year first above written.
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/  Mark M. Rothleitner    
    Name:   Mark M. Rothleitner   
    Title:     Assistant Treasurer  
       
 
 
STANLEY BLACK & DECKER, INC.
 
       
 
By:
/s/  Craig A. Douglas  
    Name:   Craig A. Douglas   
    Title:     Vice President and Treasurer  
       
 
 
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
 
       
 
By:
/s/  Cheryl L. Clarke    
    Name:   Cheryl L. Clarke    
    Title:     Vice President  
       
 
 
 
 
 
Exhibit 4.3
 
 
 
 
 

 
 
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK MELLON
 
as Trustee
 
 
FIRST SUPPLEMENTAL INDENTURE
 
to the
 
INDENTURE
 
dated as of October 18, 2004
 
 
Dated as of March 12, 2010

 
 
 
 
 
 
 
 
 
THIS FIRST SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 12, 2010, is among THE BLACK & DECKER CORPORATION, a Maryland corporation (the “Company”), STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “Guarantor”), and THE BANK OF NEW YORK MELLON (formerly known as The Bank of New York), as trustee (the “Trustee”).
 
Witnesseth:
 
WHEREAS, the Company has executed and delivered to the Trustee an Indenture, dated as of October 18, 2004, between the Company and the Trustee (the “Indenture”), providing for the issuance from time to time of one or more series of Securities;
 
WHEREAS, the Trustee has heretofore authenticated, and the Company has heretofore issued $300,000,000 aggregate principal amount of 4.75% Notes due 2011 under the Indenture (the “Outstanding Notes”);
 
WHEREAS, on the date hereof, a wholly-owned subsidiary of the Guarantor will merge with and into the Company with the Company as the survivor pursuant to that certain Agreement and Plan of Merger, dated as of November 2, 2009, among the Company, the Guarantor and Blue Jay Acquisition Corp., the Company will become a wholly-owned subsidiary of the Guarantor and the Guarantor will provide a full and unconditional guarantee (the “Guarantee”) of the obligations of the Company under the Outstanding Notes;
 
WHEREAS, pursuant to Section 9.1(c) of the Indenture, the Trustee and the Company are authorized to enter into a supplemental indenture, without prior notice to or consent of any Holders of the Outstanding Notes, to add guarantees with respect to any series of Securities;
 
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company and the Guarantor; and
 
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
The amendment set forth below shall become effective upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee.
 
 
ARTICLE 1
 
GUARANTEE
 
 
Section 1.1 .         Amendments to Indenture.
 
 
The following Sections 11.1 through and including Section 11.8 shall be added as a new Article 11 of the Indenture, and shall hereinafter be deemed a part of the Indenture and applicable to the Outstanding Notes.  The following definition shall apply to Article 11 of the Indenture, as amended hereby: “Guarantor” shall mean Stanley Black & Decker, Inc., a Connecticut Corporation.
 
 
 
2
 
 
 
Section 11.1.          Guarantees .
 
With respect to each series of Securities to which this Article 11 is expressly made applicable, the Guarantor hereby unconditionally and irrevocably guarantees to each Holder and to the Trustee and its successors and assigns (i)(a) the full and punctual payment of principal and interest on the Securities of such Holder when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company to the Holders and the Trustee under this Indenture and the Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture and the Securities and (ii) in the case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal (all of the foregoing being hereinafter collectively called the “Guarantees”).
 
The Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guarantees and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Securities or the Guarantees.  The Guarantees hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person under this Indenture, the Securities or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Securities or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Guarantees or any of them; (e) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guarantees or (f) any change in the ownership of the Guarantor.
 
The Guarantor further agrees that its Guarantees hereunder constitute a guarantee of payment, performance and compliance when due (and not a guarantee of collection).
 
The Guarantor hereby agrees that its obligations hereunder shall be as principal and not merely as surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or failure to enforce the provisions of any Security or this Indenture, or any waiver, modification, consent or indulgence granted to the Company with respect thereto (unless the same shall also be provided the Guarantor), by the Holder of any Security or the Trustee, the recovery of any judgment against the Company or any action to enforce the same, or any other  circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided that, notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall, without the consent of the Guarantor, increase the principal amount of a Security or the interest rate thereon or increase any premium payable upon redemption thereof.  The Guarantees shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guarantees or otherwise.  Without limiting the generality of the foregoing, the Guarantor covenants that the Guarantees shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.
 
 
 
 
3
 
 
 
The Guarantor further agrees that the Guarantees shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal, premium, if any, or interest on any Security is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
 
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay the principal of, premium on, if any, or interest on any Security when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other obligation under the Securities, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such obligations under such Securities, (ii) accrued and unpaid interest on such obligations under such Securities (but only to the extent not prohibited by law) and (iii) all other monetary obligations with respect to such Securities of the Company to the Holders and the Trustee.
 
The Guarantor will be subrogated to all rights of the Holders against the Company in respect of any amount paid by the Guarantor pursuant to the provisions of the Guarantee; provided, however, that the Guarantor shall not be entitled to enforce, or to receive any payments arising out of or based upon, such right of subrogation until the principal of, premium on, if any, and interest on such Securities shall have been paid in full. The Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations with respect to the Securities hereby may be accelerated as provided herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations with respect to such Securities, and (y) in the event of any declaration of acceleration of such obligations as provided herein, the Guarantees (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Article 11.
 
The Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Article 11.
 
Section 11.2.          Successors and Assigns .
 
This Article 11 shall be binding upon the Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
 
 
 
4
 
 
 
 
Section 11.3.          No Waiver .
 
Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 11 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 11 at law, in equity, by statute or otherwise.
 
Section 11.4.          Modification .
 
No modification, amendment or waiver of any provision of this Article 11, nor the consent to any departure by the Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstances.
 
Section 11.5.          Notation of Guarantee Not Required .
 
The Guarantor hereby agrees that the Guarantee set forth in this Article 11 shall remain in full force and effect notwithstanding the absence on any Security of a notation relating to the Guarantee.
 
Section 11.6.          Benefits Acknowledged .
 
The Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the guarantee and waivers made by it pursuant to its Guarantee are knowingly made in contemplation of such benefits.
 
Section 11.7.          Release of Guarantee .
 
Provided that no notice that a Default or Event of Default has occurred and is continuing has been delivered to the Holders, the Guarantee shall be automatically and unconditionally released and discharged, and no further action by the Guarantor, the Company or the Trustee is required for the release of the Guarantee, upon the Company delivering to the Trustee an Officers’ Certificate stating that the Guarantee is released in full.
 
Section 11.8.          Limitation on Guarantor Liability .
 
The Guarantor, and by its acceptance of Securities, each Holder, hereby confirms that it is the intention of all such parties that the Guarantee of the Guarantor not constitute a fraudulent transfer or conveyance for purposes of Title 11, U.S. Code or any similar federal or state law for the relief of debtors, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to the Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantor hereby irrevocably agree that the obligations of the Guarantor shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws and after giving effect to any collections from, result in the obligations of the Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law.
 
 
 
 
 
5
 
 
 
ARTICLE 2
 
MISCELLANEOUS
 
Section 2.1           Effect of Guarantee; Guarantor to be Bound by Indenture.
 
The Guarantor hereby irrevocably fully and unconditionally Guarantees to each Holder of Outstanding Notes and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, any Outstanding Notes or the obligations of the Company under the Indenture or any Outstanding Notes, the obligations of the Company with respect to payment and performance of each Outstanding Note and the other obligations of the Company under the Indenture with respect to the Outstanding Notes on the terms, and subject to the conditions, contained in Article 11 of the Indenture (as amended by this Supplemental Indenture) and agrees to be bound by all other terms of the Indenture.
 
Section 2.2 .          Effect of Supplemental Indenture.
 
Upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee, the Indenture and each of the Outstanding Notes shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Outstanding Notes heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby.
 
Section 2.3 .   Ratification of Indenture.
 
Except as supplemented hereby, all provisions in the Indenture and each of the Outstanding Notes shall remain in full force and effect.  This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture, the Outstanding Notes and this Supplemental Indenture shall henceforth be read and construed together.  The Indenture and the Outstanding Notes, as supplemented by this Supplemental Indenture, shall in all respects remain in full force and effect.
 
Section 2.4 .          Trustee Not Responsible For Recitals; Reaffirmation of Indemnity.
 
(a)   The recitals herein contained are made by the Company and the Guarantor and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
 
 
 
 
6
 
 
(b)   The Company hereby reaffirms its indemnification obligations to the Trustee pursuant to Section 7.7 of the Indenture in connection with the Trustee’s execution of this Supplemental Indenture.
 
Section 2.5          Conflict with Trust Indenture Act.
 
If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern any provision of this Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
 
Section 2.6 .          Terms Defined in the Indenture.
 
All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
 
Section 2.7 .          New York Law to Govern.
 
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF TO THE EXTENT A DIFFERENT LAW WOULD GOVERN AS A RESULT.
 
Section 2.8 .          Severability.
 
In case any one or more of the provisions contained in this Supplemental Indenture, or in the Indenture or Outstanding Notes as supplemented by this Supplemental Indenture, shall for any reason be held to be invalid, illegal or unenforceable in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture, the Indenture or the Outstanding Notes, but this Supplemental Indenture, the Indenture and the Outstanding Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
Section 2.9.           Counterparts.
 
This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
*   *   *   *   *
 
 
 
 
 
7
 
 
 
 
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed as of the day and year first above written.
 
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/  Mark M. Rothleitner    
    Name:   Mark M. Rothleitner   
    Title:     Assistant Treasurer  
       
 
 
STANLEY BLACK & DECKER, INC.
 
       
 
By:
/s/  Craig A. Douglas  
    Name:   Craig A. Douglas   
    Title:     Vice President and Treasurer  
       
 
 
THE BANK OF NEW YORK MELLON,  as Trustee
 
       
 
By:
/s/  Cheryl L. Clarke    
    Name:   Cheryl L. Clarke    
    Title:     Vice President  
       
 
 
Exhibit 4.4
 
 
 

 
 
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK MELLON
 
as Trustee
 
 
FIRST SUPPLEMENTAL INDENTURE
 
to the
 
INDENTURE
 
dated as of June 5, 2001
 
 
Dated as of March 12, 2010
 
 
 
 
 

 
 
THIS FIRST SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 12, 2010, is among THE BLACK & DECKER CORPORATION, a Maryland corporation (the “Company”), STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “Guarantor”), and THE BANK OF NEW YORK MELLON (formerly known as The Bank of New York), as trustee (the “Trustee”).
 
Witnesseth:
 
WHEREAS, the Company has executed and delivered to the Trustee an Indenture, dated as of June 5, 2001, between the Company and the Trustee (the “Indenture”), providing for the issuance from time to time of one or more series of Securities;
 
WHEREAS, the Trustee has heretofore authenticated, and the Company has heretofore issued $400,000,000 aggregate principal amount of 7.125% Notes due 2011 under the Indenture (the “Outstanding Notes”);
 
WHEREAS, on the date hereof, a wholly-owned subsidiary of the Guarantor will merge with and into the Company with the Company as the survivor pursuant to that certain Agreement and Plan of Merger, dated as of November 2, 2009, among the Company, the Guarantor and Blue Jay Acquisition Corp., the Company will become a wholly-owned subsidiary of the Guarantor and the Guarantor will provide a full and unconditional guarantee (the “Guarantee”) of the obligations of the Company under the Outstanding Notes;
 
WHEREAS, pursuant to Section 9.1(c) of the Indenture, the Trustee and the Company are authorized to enter into a supplemental indenture, without prior notice to or consent of any Holders of the Outstanding Notes, to add guarantees with respect to any series of Securities;
 
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company and the Guarantor; and
 
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
The amendment set forth below shall become effective upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee.
 
 
ARTICLE 1
 
GUARANTEE
 
Section 1.1 .       Amendments to Indenture.
 
The following Sections 11.1 through and including Section 11.8 shall be added as a new Article 11 of the Indenture, and shall hereinafter be deemed a part of the Indenture and applicable to the Outstanding Notes.  The following definition shall apply to Article 11 of the Indenture, as amended hereby: “Guarantor” shall mean Stanley Black & Decker, Inc., a Connecticut Corporation.
 
 
 
 
 
 
Section 11.1.        Guarantees .
 
With respect to each series of Securities to which this Article 11 is expressly made applicable, the Guarantor hereby unconditionally and irrevocably guarantees to each Holder and to the Trustee and its successors and assigns (i)(a) the full and punctual payment of principal and interest on the Securities of such Holder when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company to the Holders and the Trustee under this Indenture and the Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture and the Securities and (ii) in the case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal (all of the foregoing being hereinafter collectively called the “Guarantees”).
 
The Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guarantees and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Securities or the Guarantees.  The Guarantees hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person under this Indenture, the Securities or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Securities or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Guarantees or any of them; (e) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guarantees or (f) any change in the ownership of the Guarantor.
 
The Guarantor further agrees that its Guarantees hereunder constitute a guarantee of payment, performance and compliance when due (and not a guarantee of collection).
 
The Guarantor hereby agrees that its obligations hereunder shall be as principal and not merely as surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or failure to enforce the provisions of any Security or this Indenture, or any waiver, modification, consent or indulgence granted to the Company with respect thereto (unless the same shall also be provided the Guarantor), by the Holder of any Security or the Trustee, the recovery of any judgment against the Company or any action to enforce the same, or any other  circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided that, notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall, without the consent of the Guarantor, increase the principal amount of a Security or the interest rate thereon or increase any premium payable upon redemption thereof.  The Guarantees shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guarantees or otherwise.  Without limiting the generality of the foregoing, the Guarantor covenants that the Guarantees shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.
 
 
 
 
2
 
 
 
The Guarantor further agrees that the Guarantees shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal, premium, if any, or interest on any Security is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
 
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay the principal of, premium on, if any, or interest on any Security when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other obligation under the Securities, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such obligations under such Securities, (ii) accrued and unpaid interest on such obligations under such Securities (but only to the extent not prohibited by law) and (iii) all other monetary obligations with respect to such Securities of the Company to the Holders and the Trustee.
 
The Guarantor will be subrogated to all rights of the Holders against the Company in respect of any amount paid by the Guarantor pursuant to the provisions of the Guarantee; provided, however, that the Guarantor shall not be entitled to enforce, or to receive any payments arising out of or based upon, such right of subrogation until the principal of, premium on, if any, and interest on such Securities shall have been paid in full. The Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations with respect to the Securities hereby may be accelerated as provided herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations with respect to such Securities, and (y) in the event of any declaration of acceleration of such obligations as provided herein, the Guarantees (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Article 11.
 
The Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Article 11.
 
Section 11.2.        Successors and Assigns .
 
This Article 11 shall be binding upon the Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
 
 
 
 
3
 
 
 
 
Section 11.3.         No Waiver .
 
Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 11 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 11 at law, in equity, by statute or otherwise.
 
Section 11.4.        Modification .
 
No modification, amendment or waiver of any provision of this Article 11, nor the consent to any departure by the Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstances.
 
Section 11.5.        Notation of Guarantee Not Required .
 
The Guarantor hereby agrees that the Guarantee set forth in this Article 11 shall remain in full force and effect notwithstanding the absence on any Security of a notation relating to the Guarantee.
 
Section 11.6.        Benefits Acknowledged .
 
The Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the guarantee and waivers made by it pursuant to its Guarantee are knowingly made in contemplation of such benefits.
 
Section 11.7.        Release of Guarantee .
 
Provided that no notice that a Default or Event of Default has occurred and is continuing has been delivered to the Holders, the Guarantee shall be automatically and unconditionally released and discharged, and no further action by the Guarantor, the Company or the Trustee is required for the release of the Guarantee, upon the Company delivering to the Trustee an Officers’ Certificate stating that the Guarantee is released in full.
 
Section 11.8.        Limitation on Guarantor Liability .
 
The Guarantor, and by its acceptance of Securities, each Holder, hereby confirms that it is the intention of all such parties that the Guarantee of the Guarantor not constitute a fraudulent transfer or conveyance for purposes of Title 11, U.S. Code or any similar federal or state law for the relief of debtors, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to the Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantor hereby irrevocably agree that the obligations of the Guarantor shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws and after giving effect to any collections from, result in the obligations of the Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law.
 
 
 
 
 
4
 
 
ARTICLE 2
 
MISCELLANEOUS
 
Section 2.1 .        Effect of Guarantee; Guarantor to be Bound by Indenture.
 
The Guarantor hereby irrevocably fully and unconditionally Guarantees to each Holder of Outstanding Notes and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, any Outstanding Notes or the obligations of the Company under the Indenture or any Outstanding Notes, the obligations of the Company with respect to payment and performance of each Outstanding Note and the other obligations of the Company under the Indenture with respect to the Outstanding Notes on the terms, and subject to the conditions, contained in Article 11 of the Indenture (as amended by this Supplemental Indenture) and agrees to be bound by all other terms of the Indenture.
 
Section 2.2 .       Effect of Supplemental Indenture.
 
Upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantor and the Trustee, the Indenture and each of the Outstanding Notes shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Outstanding Notes heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby.
 
Section 2.3 .        Ratification of Indenture.
 
Except as supplemented hereby, all provisions in the Indenture and each of the Outstanding Notes shall remain in full force and effect.  This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture, the Outstanding Notes and this Supplemental Indenture shall henceforth be read and construed together.  The Indenture and the Outstanding Notes, as supplemented by this Supplemental Indenture, shall in all respects remain in full force and effect.
 
Section 2.4 .        Trustee Not Responsible For Recitals; Reaffirmation of Indemnity.
 
(a)   The recitals herein contained are made by the Company and the Guarantor and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
 
 
 
 
5
 
 
 
(b)   The Company hereby reaffirms its indemnification obligations to the Trustee pursuant to Section 7.7 of the Indenture in connection with the Trustee’s execution of this Supplemental Indenture.
 
Section 2.5 .        Conflict with Trust Indenture Act.
 
If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern any provision of this Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
 
Section 2.6 .        Terms Defined in the Indenture.
 
All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
 
Section 2.7 .        New York Law to Govern.
 
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF TO THE EXTENT A DIFFERENT LAW WOULD GOVERN AS A RESULT.
 
Section 2.8 .        Severability.
 
In case any one or more of the provisions contained in this Supplemental Indenture, or in the Indenture or Outstanding Notes as supplemented by this Supplemental Indenture, shall for any reason be held to be invalid, illegal or unenforceable in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture, the Indenture or the Outstanding Notes, but this Supplemental Indenture, the Indenture and the Outstanding Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
Section 2.9 .        Counterparts.
 
This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
*   *   *   *   *
 
 
 
 
6
 
 
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed as of the day and year first above written.
 
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/  Mark M. Rothleitner    
    Name:   Mark M. Rothleitner   
    Title:     Assistant Treasurer  
       
 
 
STANLEY BLACK & DECKER, INC.
 
       
 
By:
/s/  Craig A. Douglas  
    Name:   Craig A. Douglas   
    Title:     Vice President and Treasurer  
       
 
 
THE BANK OF NEW YORK MELLON, as Trustee
 
       
 
By:
/s/  Cheryl L. Clarke    
    Name:   Cheryl L. Clarke    
    Title:     Vice President  
       
 
 
Exhibit 4.5
 
 
 

 
BLACK & DECKER HOLDINGS, LLC
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK MELLON
 
as Trustee
 
 
FIRST SUPPLEMENTAL INDENTURE
 
to the
 
INDENTURE
 
dated as of June 26, 1998

 
 
Dated as of March 12, 2010
 
 
 
 
 
 

 
 
THIS FIRST SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 12, 2010, is among BLACK & DECKER HOLDINGS, LLC (formerly known as Black & Decker Holdings Inc.), THE BLACK & DECKER CORPORATION, a Maryland corporation (the “Existing Guarantor”), STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “Additional Guarantor”), and THE BANK OF NEW YORK MELLON (as successor-in-interest to The First National Bank of Chicago), as trustee (the “Trustee”).
 
Witnesseth:
 
WHEREAS, the Company and the Existing Guarantor have executed and delivered to the Trustee an Indenture, dated as of June 26, 1998, by and among the Company, the Existing Guarantor and the Trustee (the “Indenture”), providing for the issuance from time to time of one or more series of Notes;
 
WHEREAS, the Trustee has heretofore authenticated, and the Company has heretofore issued $150,000,000 aggregate principal amount of 7.05% Notes due 2028 under the Indenture, fully and unconditionally guaranteed by the Existing Guarantor (the “Outstanding Notes”);
 
WHEREAS, on the date hereof, a wholly-owned subsidiary of the Additional Guarantor will merge with and into the Existing Guarantor with the Existing Guarantor as the survivor pursuant to that certain Agreement and Plan of Merger, dated as of November 2, 2009, among the Existing Guarantor, the Additional Guarantor and Blue Jay Acquisition Corp., the Existing Guarantor will become a wholly-owned subsidiary of the Additional Guarantor and the Additional Guarantor will provide a full and unconditional guarantee (the “Guarantee”) of the obligations of the Company under the Outstanding Notes;
 
WHEREAS, pursuant to Section 9.1(x) of the Indenture, the Trustee, the Existing Guarantor and the Company are authorized to enter into a supplemental indenture, without prior notice to or consent of any Holders of the Outstanding Notes, to provide additional benefits to Holders of Notes;
 
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company, the Existing Guarantor and the Additional Guarantor; and
 
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
The amendment set forth below shall become effective upon the execution and delivery of this Supplemental Indenture by the Company, the Existing Guarantor, the Additional Guarantor and the Trustee.
 
 
 
 
 
 
 
ARTICLE 1
 
GUARANTEE
 
Section 1.1.            Amendments to Indenture.
 
The following definition shall amend and replace the definition of "Guarantor" in the Indenture, and shall hereinafter be deemed a part of the Indenture and applicable to the Outstanding Notes.  “Guarantor” shall mean Stanley Black & Decker, Inc., a Connecticut Corporation, and The Black & Decker Corporation, a Maryland Corporation, as joint and several obligors under the Guarantee referred to herein, in each case until one or more successor corporations shall have become such pursuant to the applicable provisions of this Indenture, and thereafter means such successors.
 
ARTICLE 2
 
MISCELLANEOUS
 
Section 2.1.            Effect of Guarantee; Guarantor to be Bound by Indenture; Release of Guarantee by Additional Guarantor.
 
(a)   The Additional Guarantor hereby irrevocably fully and unconditionally Guarantees, jointly and severally with the Existing Guarantor, to each Holder of Outstanding Notes and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, any Outstanding Notes or the obligations of the Company under the Indenture or any Outstanding Notes, the obligations of the Company with respect to payment and performance of each Outstanding Note and the other obligations of the Company under the Indenture with respect to the Outstanding Notes on the terms, and subject to the conditions, contained in Article 10 of the Indenture and agrees to be bound by all other terms of the Indenture.
 
(b)      Provided that no notice that a Default or Event of Default has occurred and is continuing has been delivered to the Holders, the Guarantee by the Additional Guarantor shall be automatically and unconditionally released and discharged, and no further action by the Additional Guarantor, the Existing Guarantor, the Company or the Trustee is required for the release of the Guarantee by the Additional Guarantor, upon the Additional Guarantor delivering to the Trustee an Officers’ Certificate stating that the Guarantee by the Additional Guarantor is released in full.
 
Section 2.2.            Effect of Supplemental Indenture.
 
Upon the execution and delivery of this Supplemental Indenture by the Company, the Additional Guarantor, the Existing Guarantor and the Trustee, the Indenture and each of the Outstanding Notes shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Outstanding Notes heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby.
 
 
 
2
 
 
 
Section 2.3            Ratification of Indenture.
 
Except as supplemented hereby, all provisions in the Indenture and each of the Outstanding Notes shall remain in full force and effect.  This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture, the Outstanding Notes and this Supplemental Indenture shall henceforth be read and construed together.  The Indenture and the Outstanding Notes, as supplemented by this Supplemental Indenture, shall in all respects remain in full force and effect.
 
Section 2.4.   Trustee Not Responsible For Recitals; Reaffirmation of Indemnity.
 
(a)   The recitals herein contained are made by the Company, the Additional Guarantor and the Existing Guarantor and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
 
(b)   The Company hereby reaffirms its indemnification obligations to the Trustee pursuant to Section 7.7 of the Indenture in connection with the Trustee’s execution of this Supplemental Indenture.
 
Section 2.5.            Conflict with Trust Indenture Act.
 
If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern any provision of this Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
 
Section 2.6.            Terms Defined in the Indenture.
 
All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
 
Section 2.7 .            New York Law to Govern.
 
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF TO THE EXTENT A DIFFERENT LAW WOULD GOVERN AS A RESULT.
 
Section 2.8.            Severability.
 
In case any one or more of the provisions contained in this Supplemental Indenture, or in the Indenture or Outstanding Notes as supplemented by this Supplemental Indenture, shall for any reason be held to be invalid, illegal or unenforceable in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture, the Indenture or the Outstanding Notes, but this Supplemental Indenture, the Indenture and the Outstanding Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
 
 
 
3
 
 
 
Section 2.9 .            Counterparts.
 
This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
Section 2.10 .            Benefits Acknowledged.
 
The Additional Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by the Indenture and that the guarantee and waivers made by it pursuant to its Guarantee are knowingly made in contemplation of such benefits.
 
*   *   *   *   *
 
 
 
 
4

 
 
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed as of the day and year first above written.
 
 
  BLACK & DECKER HOLDINGS, LLC  
       
 
By:
/s/  Elizabeth A. Dolce    
    Name:   Elizabeth A. Dolce    
    Title:     Vice Chairman  
       
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/  Mark M. Rothleitner    
    Name:   Mark M. Rothleitner   
    Title:     Assistant Treasurer  
       
 
 
STANLEY BLACK & DECKER, INC.
 
       
 
By:
/s/  Craig A. Douglas  
    Name:   Craig A. Douglas   
    Title:     Vice President and Treasurer  
       
 
 
THE BANK OF NEW YORK MELLON,  as Trustee
 
       
 
By:
/s/  Cheryl L. Clarke    
    Name:   Cheryl L. Clarke    
    Title:     Vice President  
       
 
 
Exhibit 4.6
 
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK,
AS TRUSTEE
 
DEBT SECURITIES
 
INDENTURE
 
Dated as of November 16, 2006
 
 
TABLE OF CONTENTS
      Page
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE
 
SECTION 1.1
SECTION 1.2
SECTION 1.3
SECTION 1.4 		  DEFINITIONS
OTHER DEFINITIONS
INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT
RULES OF CONSTRUCTION 		1
5
5
6
 
ARTICLE II. THE DEBT SECURITIES
 
SECTION 2.1
SECTION 2.2
SECTION 2.3
SECTION 2.4
SECTION 2.5
SECTION 2.6
SECTION 2.7
SECTION 2.8
SECTION 2.9
SECTION 2.10
SECTION 2.11
SECTION 2.12
SECTION 2.13
SECTION 2.14
SECTION 2.15 		  FORM AND DATING
EXECUTION AND AUTHENTICATION
AMOUNT UNLIMITED; ISSUABLE IN SERIES
BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES
REGISTRAR AND PAYING AGENT
PAYING AGENT TO HOLD MONEY IN TRUST
HOLDER LISTS
TRANSFER AND EXCHANGE
MUTILATED, DESTROYED, LOST OR STOLEN DEBT SECURITIES
OUTSTANDING DEBT SECURITIES
TEMPORARY DEBT SECURITIES
CANCELLATION
PAYMENT OF INTEREST; DEFAULTED INTEREST
COMPUTATION OF INTEREST
CUSIP AND ISIN NUMBERS 		7
7
9
11
13
13
14
14
16
16
17
17
17
18
19
ARTICLE III. COVENANTS
 
SECTION 3.1
SECTION 3.2
SECTION 3.3
SECTION 3.4
SECTION 3.5
SECTION 3.6
SECTION 3.7 		  PAYMENT OF DEBT SECURITIES
LIMITATION ON LIENS
LIMITATION ON SALE LEASEBACK TRANSACTIONS
MAINTENANCE OF OFFICE OR AGENCY
COMPLIANCE CERTIFICATE
STATEMENT BY OFFICERS AS TO DEFAULT
FURTHER INSTRUMENTS AND ACTS 		19
20
20
21
21
22
22
 
ARTICLE IV. SUCCESSOR COMPANY
 
SECTION 4.1   MERGER, CONSOLIDATION OR SALE OF ALL OR SUBSTANTIALLY ALL ASSETS OF THE COMPANY 22
 
ARTICLE V. REDEMPTION OF SECURITIES
 
SECTION 5.1
SECTION 5.2
SECTION 5.3
SECTION 5.4
SECTION 5.5 		  OPTIONAL REDEMPTION
APPLICABILITY OF ARTICLE
ELECTION TO REDEEM; NOTICE TO TRUSTEE
SELECTION BY TRUSTEE OF DEBT SECURITIES TO BE REDEEMED
NOTICE OF REDEMPTION 		22
23
23
23
24
 
 
SECTION 5.6
SECTION 5.7
SECTION 5.8 		  DEPOSIT OF REDEMPTION PRICE
DEBT SECURITIES PAYABLE ON REDEMPTION DATE
DEBT SECURITIES REDEEMED IN PART 		25
25
25
 
ARTICLE VI. DEFAULTS AND REMEDIES
 
SECTION 6.1
SECTION 6.2
SECTION 6.3
SECTION 6.4
SECTION 6.5
SECTION 6.6
SECTION 6.7
SECTION 6.8
SECTION 6.9
SECTION 6.10
SECTION 6.11 		  EVENTS OF DEFAULT
ACCELERATION
OTHER REMEDIES
WAIVER OF EXISTING DEFAULTS
CONTROL BY MAJORITY
LIMITATION ON SUITS
RIGHTS OF HOLDERS TO RECEIVE PAYMENT
COLLECTION SUIT BY TRUSTEE
TRUSTEE MAY FILE PROOFS OF CLAIM
PRIORITIES
UNDERTAKING FOR COSTS 		25
27
27
27
28
28
28
29
29
29
29
 
ARTICLE VII. TRUSTEE
 
SECTION 7.1
SECTION 7.2
SECTION 7.3
SECTION 7.4
SECTION 7.5
SECTION 7.6
SECTION 7.7
SECTION 7.8
SECTION 7.9
SECTION 7.10
SECTION 7.11 		  DUTIES OF TRUSTEE
RIGHTS OF TRUSTEE
INDIVIDUAL RIGHTS OF TRUSTEE
TRUSTEE'S DISCLAIMER
NOTICE OF DEFAULTS
REPORTS BY TRUSTEE TO HOLDERS
COMPENSATION AND INDEMNITY
REPLACEMENT OF TRUSTEE
SUCCESSOR TRUSTEE BY MERGER
ELIGIBILITY; DISQUALIFICATION
PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY 		30
31
32
32
33
33
33
34
35
35
36
 
ARTICLE VIII. SATISFACTION AND DISCHARGE OF INDENTURE
 
SECTION 8.1
SECTION 8.2
SECTION 8.3
SECTION 8.4
SECTION 8.5
SECTION 8.6
SECTION 8.7
SECTION 8.8
SECTION 8.9
SECTION 8.10 		  OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE
LEGAL DEFEASANCE AND DISCHARGE
COVENANT DEFEASANCE
CONDITIONS TO LEGAL OR COVENANT DEFEASANCE
SATISFACTION AND DISCHARGE OF INDENTURE
SURVIVAL OF CERTAIN OBLIGATIONS
ACKNOWLEDGMENT OF DISCHARGE BY TRUSTEE
APPLICATION OF TRUST MONEYS
REPAYMENT TO THE COMPANY; UNCLAIMED MONEY
REINSTATEMENT 		36
36
36
37
38
39
39
39
40
40
 
ARTICLE IX. AMENDMENTS
 
SECTION 9.1
SECTION 9.2
SECTION 9.3
SECTION 9.4
SECTION 9.5 		  WITHOUT CONSENT OF HOLDERS
WITH CONSENT OF HOLDERS
COMPLIANCE WITH TRUST INDENTURE ACT
NOTATION ON OR EXCHANGE OF DEBT SECURITIES
TRUSTEE TO SIGN AMENDMENTS 		40
41
42
42
42
 
 
ARTICLE X. MISCELLANOUS
 
     
SECTION 10.1
SECTION 10.2
SECTION 10.3
SECTION 10.4
SECTION 10.5
SECTION 10.6
SECTION 10.7
SECTION 10.8
SECTION 10.9
SECTION 10.10
SECTION 10.11
SECTION 10.12
SECTION 10.13
SECTION 10.14
SECTION 10.15
SECTION 10.16 		  TRUST INDENTURE ACT CONTROLS
NOTICES
COMMUNICATION BY HOLDERS WITH OTHER HOLDERS
CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT
STATEMENTS REQUIRED IN CERTIFICATE OR OPINION
WHEN DEBT SECURITIES DISREGARDED
RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR
LEGAL HOLIDAYS
GOVERNING LAW; WAIVER OF JURY TRIAL
NO RECOURSE AGAINST OTHERS
SUCCESSORS
MULTIPLE ORIGINALS
VARIABLE PROVISIONS
TABLE OF CONTENTS; HEADINGS
FORCE MAJEURE
SEVERABILITY 		42
42
43
43
44
44
44
44
44
45
45
45
45
45
45
45
 
 
CROSS-REFERENCE TABLE
 
TIA Section
310(a)(1)
(a)(2)
(a)(3)
(a)(4)
(b)    
(c)    
311(a)    
(b)    
(c)    
313(a)    
(b)(1)
(b)(2)
(c)    
(d)    
314(a)    
(b)    
(c)(1)
(c)(2)
(c)(3)
(d)    
(e)    
315(a)    
(b)    
(c)    
(d)    
(e)    
316(a)(last sentence)
(a)(1)(A)
(a)(1)(B)
(a)(2)
(b)    
317(a)(1)
(a)(2)
(b)    
318(a)     		 


Indenture Section
7.10
7.10
N.A.
N.A.
7.8;7.10
N.A.
7.11
7.11
N.A.
2.7
10.3
10.3
7.6
N.A.
7.6
7.6
7.6
3.5;10.2;10.5
N.A.
10.4
10.4
N.A.
N.A.
10.5
7.1
7.5;10.2
7.1
7.1
6.11
10.6
6.5
6.4
N.A.
6.7
6.8
6.9
2.5
10.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.
 
1
 
       INDENTURE, dated as of November 16, 2006, between THE BLACK & DECKER CORPORATION, a Maryland corporation, and THE BANK OF NEW YORK, a New York banking corporation, as Trustee.
 
        Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company ’ s debt securities to be issued in one or more series (the “ Debt Securities ” ) up to such principal amount or amounts as may be authorized from time to time in accordance with the terms of this Indenture.
 
ARTICLE I
Definitions and Incorporation by Reference
 
      SECTION 1.1 Definitions .
 
        “ Attributable Debt ” for a lease means the carrying value of the capitalized rental obligation determined under generally accepted accounting principles whether or not such obligation is required to be shown on the balance sheet as a long-term liability. The carrying value may be reduced by the capitalized value of the rental obligations, calculated on the same basis, that any sublessee has for all or part of the same property.
 
        “ Board of Directors ” means, as to any Person, the board of directors of such Person or any duly authorized committee thereof.
 
        “ Board Resolution ” means, with respect to any Person, a resolution of the Board of Directors or of a committee or person to which or to whom the Board of Directors has properly delegated the appropriate authority, a copy of which has been certified by the Secretary or an Assistant Secretary of the Person to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivered to the Trustee.
 
        “ Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in New York City.
 
        “ Company ” means The Black & Decker Corporation or its successor.
 
        “ Consolidated Net Tangible Assets ” means total assets less (1) total current liabilities (excluding any Debt which, at the option of the applicable borrower, is renewable or extendible to a term exceeding 12 months and which is included in current liabilities and further excluding any deferred income taxes which are included in current liabilities) and (2) goodwill, patents, trademarks and other like intangibles, all as stated on the Company ’ s most recent quarter-end consolidated balance sheet preceding the date of determination.
 
        “ Corporate Trust Office ” means the designated office of the Trustee at which at any time its corporate trust business shall be administered, which office at the date hereof is located at 101 Barclay Street, New York, New York, Floor 8W, Attention: Corporate Trust Administration, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor Trustee may designate from time to time by notice to the Holders and the Company).
 
 
2
 
        “ Debt ” means any debt for borrowed money (including the Debt Securities), capitalized lease obligations and purchase money obligations, or any guarantee of such debt, in any such case that would appear on the consolidated balance sheet of the Company as a liability.
 
        “ Debt Securities ” means, as defined in the second introductory paragraph of this Indenture, any of the securities that are authenticated and delivered under this Indenture.
 
        “ Default ” means any event that is, or after notice or passage of time or both would be, an Event of Default.
 
        “ Depositary ” means with respect to the Debt Securities of any series issuable or issued in the form of one or more Global Securities, The Depository Trust Company, or such other Person designated as Depositary by the Company pursuant to Section 2.3 until a successor Depositary shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Depositary” shall mean or include each Person who is then a Depositary hereunder, and if at any time there is more than one such Person, “ Depositary ” as used with respect to the Debt Securities of any such series shall mean the Depositary with respect to the Global Securities of that series.
 
        “ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
 
        “ Exempted Debt ” calculated with respect to any series of Debt Securities means the sum, without duplication, of the following items outstanding as of the date of determination: (i) Debt incurred after the date on which the Debt Securities of the applicable series are first issued and secured by liens created or assumed or permitted to exist pursuant to paragraph (b) of Section 3.2 and (ii) Attributable Debt of the Company and its Subsidiaries in respect of all sale and lease-back transactions with regard to any Principal Property entered into pursuant to paragraph (b) of Section 3.3 .
 
        “ Fiscal Year ” means the fiscal year of the Company.
 
        “ Funded Debt ” means all Debt having a maturity of more than one year from the date of its creation or having a maturity of less than one year but by its terms being renewable or extendible, at the option of the obligor in respect thereof, beyond one year from its creation.
 
        “ Global Security ” means a Debt Security evidencing all or part of a series of Debt Securities issued to the Depositary for such series in accordance with Sections 2.2 and 2.4 .
 
        “ Holder ” means the Person in whose name a Debt Security is registered in the Security Register.
 
        “ Indenture ” means this Indenture, as amended or supplemented from time to time.
 
        “ Issue Date ” means the date on which a series of Debt Securities are originally issued.
 
 
3
 
        “ Legal Holiday ” has the meaning ascribed to it in Section 10.8 .
 
        “ Officer ” means the Chairman of the Board, any Vice Chairman of the Board, the President, the Chief Financial Officer, any Senior Vice President, any Vice President, the Treasurer or the Secretary of the Company.
 
        “ Officers ’ Certificate ” means a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company and delivered to the Trustee. An Officers ’ Certificate given pursuant to Section 3.5 shall be signed by any of the principal executive officer, the principal financial officer or the principal accounting officer of the Company and any other Officer.
 
        “ Opinion of Counsel ” means a written opinion (subject to customary assumptions, qualifications and exceptions) from legal counsel that is reasonably acceptable to the Trustee. Unless otherwise required by the TIA, the counsel may be an employee of or counsel to the Company.
 
        “ Person ” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company, government or any agency or political subdivision thereof or any other entity.
 
        “ principal ” of any Debt (including the Debt Securities) means the principal amount of such Debt plus the premium, if any, on such Debt.
 
        “ Principal Property ” means land, land improvements, buildings and associated factory and laboratory equipment owned or leased pursuant to a capital lease and used by the Company or any Subsidiary primarily for manufacturing, assembling, processing, producing, packaging or storing its products, raw materials, inventories or other materials and supplies located in the United States and having an acquisition cost plus capitalized improvements in excess of 2% of Consolidated Net Tangible Assets as of the date of determination, but shall not include any such property financed through the issuance of tax exempt governmental obligations, or any such property that has been determined by Board Resolution of the Company not to be of material importance to the respective businesses conducted by the Company and its Subsidiaries taken as a whole, effective as of the date such resolution is adopted.
 
        “ Redemption Date ” means, with respect to any redemption of Debt Securities, the date of redemption with respect thereto.
 
        “ SEC ” means the Securities and Exchange Commission.
 
        “ Securities Act ” means the Securities Act of 1933, as amended.
 
        “ Securities Custodian ” means the custodian with respect to the Global Security (as appointed by the Depositary), or any successor Person thereto and shall initially be the Trustee.
 
        “ Security Register ” has the meaning ascribed to it in Section 2.5 .
 
 
4
 
        “ Stated Maturity ” means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but shall not include any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.
 
        “ Subsidiary ” means any corporation, limited liability company or other business entity of which more than 50% of the total voting power of the equity interests entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof or any partnership of which more than 50% of the partners’ equity interests (considering all partners ’ equity interests as a single class) is, in each case, at the time owned or controlled, directly or indirectly, by the Company, one or more of the Subsidiaries of the Company, or a combination thereof.
 
        “ TIA ” or “ Trust Indenture Act ” means the Trust Indenture Act of 1939 (15 U.S.C. §§  77aaa-77bbbb), as in effect on the date of this Indenture; provided , however , in the event the Trust Indenture Act of 1939 is amended after such date, “TIA” or “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939, as so amended.
 
        “ Trustee ” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.
 
        “ Trust Officer ” shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such Person ’ s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.
 
    “ U.S. GAAP ” means generally accepted accounting principles in the United States as have been approved by a significant segment of the United States accounting profession, which are in effect at the time of each application for purposes of determining compliance with Article III . For the purposes of this Indenture, the term ”consolidated” with respect to any Person shall mean such Person consolidated with its Subsidiaries.
 
    “ U.S. Government Securities ” means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S. Government Securities or a specific payment of principal of or interest on any such U.S. Government Securities held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Securities or the specific payment of principal of or interest on the U.S. Government Securities evidenced by such depository receipt.
 
 
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      SECTION 1.2 Other Definitions .
 
  Term Defined in
Section

  “ Act”
“Authenticating Agent”
“Bankruptcy Law”
“Company Order”
“Corporate Trust Office”
“Covenant Defeasance”
“Custodian”
“Defaulted Interest”
“Event of Default”
“Legal Defeasance”
“Notice of Default”
“Paying Agent”
“Registrar”
“Security Register”
“Special Interest Payment Date”
“Special Record Date” 		1.5
2.2
6.1
2.2
3.4
8.3
6.1
2.13
6.1
8.2
6.1
2.5
2.5
2.5
2.13
2.13
 
      SECTION 1.3 Incorporation by Reference of Trust Indenture Act .
 
        This Indenture is subject to the mandatory provisions of the TIA, which are incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings:
 
        “ Commission ” means the SEC;
 
        “ indenture securities ” means the Debt Securities;
 
        “ indenture security holder ” means a Holder;
 
        “ indenture to be qualified ” means this Indenture;
 
        “ indenture trustee ” or “ institutional trustee ” means the Trustee; and
 
        “ obligor ” on the Debt Securities means the Company and any other obligor on the Debt Securities.
 
        All other TIA terms used in this Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.
 
 
 
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      SECTION 1.4 Rules of Construction .
 
      Unless the context otherwise requires:
 
                   (a)    a term has the meaning assigned to it;
 
                   (b)    an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;
 
                   (c)     “ or ” is not exclusive;
 
                   (d)    “including” means including without limitation;
 
                   (e)    “including” words in the singular include the plural and words in the plural include the singular;
 
                   (f)    the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with U.S. GAAP; and
 
                   (g)    unless otherwise indicated, all references to Articles or Sections refer to Articles or Sections of this Indenture.
 
      SECTION 1.5 Acts of Holders .
 
                   (a)    Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section 1.5 .
 
                   (b)    The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to such officer the execution thereof. Where such execution is by a signer acting in a capacity other than such signer ’ s individual capacity, such certificate or affidavit shall also constitute sufficient proof of such signer’s authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.
 
 
 
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                   (d)    The ownership of registered Debt Securities shall be proved by the Security Register.
 
                   (e)    Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Debt Security shall bind every future Holder of the same Security and the holder of every Debt Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Debt Security.
 
                   (f)    If the Company shall solicit from the Holders any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a Board Resolution, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of outstanding Debt Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the outstanding Debt Securities shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date.
 
ARTICLE II
The Debt Securities
 
        SECTION 2.1 Form . The Debt Securities of each series shall be issued pursuant to a Board Resolution and shall be substantially in the form or forms (not inconsistent with this Indenture) as shall be established in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may have such letters, numbers or other marks of identification and such legends or endorsements imprinted or otherwise reproduced thereon, not inconsistent with the provisions of this Indenture, as may be required to comply with any law, or with any rules of any securities exchange, all as may, consistently herewith, be determined by the Officers executing such Debt Securities as evidenced by their execution of the Debt Securities.
 
        The Debt Securities may have notations, legends or endorsements required by law, stock exchange rule or usage. The Company and the Trustee shall approve the forms of the Debt Securities and any notation, endorsement or legend on them, which shall be attached to an indenture supplemental hereto.
 
        SECTION 2.2 Execution and Authentication . One Officer shall sign the Debt Securities for the Company by manual or facsimile signature. If an Officer whose signature is on a Debt Security no longer holds that office at the time the Trustee authenticates the Debt Security, the Debt Security shall be valid nevertheless.
 
 
 
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        A Debt Security shall not be valid until an authorized signatory of the Trustee manually authenticates the Debt Security. The signature of the Trustee on a Debt Security shall be conclusive evidence that such Debt Security has been duly and validly authenticated and issued under this Indenture. A Debt Security shall be dated the date of its authentication.
 
        At any time and from time to time after the execution and delivery of this Indenture, the Trustee shall authenticate and make available for delivery Debt Securities of any series in such form or forms as shall be established pursuant to Section 2.1 , upon a written order of the Company signed by two Officers or by an Officer and either an assistant treasurer or an assistant secretary of the Company (the “ Company Order ” ) and delivered to the Trustee. Such Company Order shall specify the amount of the Debt Securities to be authenticated and the date on which the original issue of such Debt Securities is to be authenticated. In authenticating any Debt Securities of a series, the Trustee shall be entitled to receive, prior to the first authentication of any Debt Securities of such series, and, subject to Article VII , shall be fully protected in relying upon, unless and until such documents have been superseded or revoked:
 
                   (a)        the executed supplemental indenture referred to in Sections 2.1 and 2.3 by or pursuant to which the form or forms and terms of the Debt Securities for such series were established;
 
                   (b)        an Officers’ Certificate certifying as to the form or forms and terms of the Debt Securities for such series having been established in compliance with this Indenture; and
 
                   (c)        an Opinion of Counsel substantially to the effect that (i) the form or forms and terms of the Debt Securities have been established in accordance with this Indenture; (ii) all conditions precedent set forth in this Indenture as to the authentication and delivery of such Debt Securities have been complied with; and (iii) the supplemental indenture, if applicable, and the Debt Securities have been duly authorized and, in the case of the Debt Securities, when authenticated and delivered by the Trustee and issued by the Company, in accordance with this Indenture, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, receivership, moratorium and other laws affecting creditors ’ rights generally and to general principles of equity;
 
         provided, however, if all Debt Securities of a particular series are not to be originally issued at one time, it shall not be necessary to deliver the foregoing documents at or prior to the time of authentication of each Debt Security of such series if such documents are delivered at or prior to the authentication upon original issuance of the first Debt Security of such series to be issued.
 
        The Trustee may appoint an agent (the “ Authenticating Agent ” ) reasonably acceptable to the Company to authenticate the Debt Securities. Unless limited by the terms of such appointment, any such Authenticating Agent may authenticate Debt Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent. An Authenticating Agent has the same rights as a Paying Agent to deal with Holders or the Company and shall have the same privileges, rights and immunities as granted to the Trustee under Article VII .
 
 
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        In case the Company, pursuant to Article IV , shall be consolidated or merged with or into any other Person or shall convey, transfer, lease or otherwise dispose of its properties and assets substantially as an entirety to any Person, and the successor Person resulting from such consolidation, or surviving such merger, or into which the Company shall have been merged, or the Person which shall have received a conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenture supplemental hereto with the Trustee pursuant to   Article IV , any of the Debt Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer, lease or other disposition may, from time to time, at the request of the successor Person, be exchanged for other Debt Securities of the same series executed in the name of the successor Person with such changes in phraseology and form as may be appropriate, but otherwise in substance of like tenor as the Debt Securities surrendered for such exchange and of like principal amount; and the Trustee, upon Company Order of the successor Person, shall authenticate and deliver Debt Securities as specified in such order for the purpose of such exchange. If Debt Securities shall at any time be authenticated and delivered in any new name of a successor Person pursuant to this Section 2.2 in exchange or substitution for or upon registration of transfer of any Debt Securities, such successor Person shall provide for the exchange of all Debt Securities at the time outstanding for Debt Securities authenticated and delivered in such new name.
 
      SECTION 2.3 Amount Unlimited; Issuable in Series .
 
        The aggregate principal amount of Debt Securities that may be authenticated and delivered under this Indenture is unlimited.
 
        The Debt Securities may be issued in one or more series. There shall be established pursuant to a Board Resolution and in one or more indentures supplemental hereto, prior to the initial issuance of Debt Securities of any series (subject to the last sentence of this Section 2.3 ):
 
                   (a)    the designation of the Debt Securities of the series, including CUSIP and ISIN Numbers (if then generally in use), which shall distinguish the Debt Securities of the series from the Debt Securities of all other series;
 
                   (b)    any limit upon the aggregate principal amount of the Debt Securities of the series that may be authenticated and delivered under this Indenture and any limitation on the ability of the Company to increase such aggregate principal amount after the initial issuance of the Debt Securities of that series (except for Debt Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, or upon redemption of, other Debt Securities of the series pursuant hereto);
 
                   (c)    the date or dates on which the principal of and premium, if any, on the Debt Securities of the series is payable, or the method by which such date or dates shall be determined (which date or dates may be fixed or extendible);
 
                   (d)    the rate or rates (which may be fixed or variable) at which the Debt Securities of the series shall bear interest, if any, the date or dates from which such interest shall accrue, on which such interest shall be payable and on which a record shall be taken for the determination of Holders to whom interest is payable and/or the method by which such rate or rates or date or dates shall be determined;
 
 
 
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                   (e)    if other than as provided in Section 3.4 , the place or places where the principal of and any premium and interest on Debt Securities of the series shall be payable, any Debt Securities of the series may be surrendered for exchange, notices, demands to or upon the Company in respect of the Debt Securities of the series and this Indenture may be served and notice to Holders may be published;
 
                   (f)    the right, if any, of the Company to redeem Debt Securities of the series, in whole or in part, at its option and the date or dates on which, the period or periods within which, the price or prices at which and any terms and conditions upon which Debt Securities of the series may be so redeemed, pursuant to any sinking fund or otherwise;
 
                   (g)    the obligation, if any, of the Company to redeem, purchase or repay Debt Securities of the series pursuant to any mandatory redemption, sinking fund or analogous provisions or at the option of a Holder thereof and the date or dates on which, the price or prices at which and the period or periods within which and any of the terms and conditions upon which Debt Securities of the series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation;
 
                   (h)    if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Debt Securities of the series shall be issuable;
 
                   (i)    if other than the entire principal amount thereof, the portion of the principal amount of Debt Securities of the series which shall be payable upon declaration of acceleration of the maturity thereof;
 
                   (j)    if the amount of payments of principal of, premium, if any, or interest, if any, on, any of the Debt Securities of the series may be determined with reference to an index, formula, or other method, the manner in which such amounts shall be determined;
 
                   (k)    if other than the coin or currency in which the Debt Securities of the series are denominated, the coin or currency in which payment of the principal of or interest on the Debt Securities of the series shall be payable or if the amount of payments of principal of or premium, if any, or interest on the Debt Securities of the series may be determined with reference to an index based on a coin or currency other than that in which the Debt Securities of the series are denominated, the manner in which such amounts shall be determined;
 
                   (l)    if payment of the principal of, premium, if any, and interest on the Debt Securities of the series shall be payable in currency or currencies other than the currency of the United States, the manner in which any such currency shall be valued against other currencies in which any other Debt Securities shall be payable;
 
                   (m)    whether the Debt Securities of the series or any portion thereof will be issuable as Global Securities, any restrictions applicable to the offer and, if other than as provided herein, the terms upon which Global Securities of any series may be exchanged for definitive Debt Securities of such series;
 
 
 
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                   (n)    whether and under what circumstances the Company will pay additional amounts on the Debt Securities of the series held by non-U.S. persons in respect of any tax, assessment or governmental charge withheld or deducted and, if so, whether the Company will have the option to redeem such Debt Securities rather than pay such additional amounts;
 
                   (o)    if the Debt Securities of the series are to be issuable in definitive form (whether upon original issue or upon exchange of a temporary Debt Security of such series) only upon receipt of certain certificates or other documents or satisfaction of other conditions, the form and terms of such certificates, documents or conditions;
 
                   (p)    if there is more than one trustee or a trustee other than The Bank of New York, any trustees, and if not the trustee, Depositaries, Authenticating Agents, Paying Agents, transfer agents or the Registrar or any other agents with respect to the Debt Securities of the series;
 
                   (q)    provisions, if any, for the defeasance of the Debt Securities of the series (including provisions permitting defeasance of less than all Debt Securities of the series), which provisions may be in addition to, in substitution for, or in modification of (or any combination of the foregoing) the provisions of Article VIII ;
 
                   (r)    if the Debt Securities of the series are issuable in whole or in part as one or more Global Securities, the identity of the Depositary for such Global Security or Securities;
 
                   (s)    any other events of default or covenants with respect to the Debt Securities of the series that are not inconsistent with this Indenture;
 
                   (t)    the form of the Debt Securities of the series (including legends, if any, to be imprinted thereon and the circumstances, if any, which require the imprinting of such legends); and
 
                   (u)    any other terms of the Debt Securities of the series (which terms shall not be inconsistent with the provisions of this Indenture).
 
        All Debt Securities of any one series and coupons, if any, appertaining thereto shall be substantially identical, except as to denomination and except as otherwise set forth in any such indenture supplemental hereto. All Debt Securities of any one series need not be issued at the same time and may be issued from time to time, consistent with the terms of this Indenture, if so provided in any such indenture supplemental hereto, and any forms and terms of Debt Securities to be issued from time to time may be completed and established from time to time prior to the issuance thereof by procedures described in such supplemental indenture.
 
        SECTION 2.4 Book-Entry Provisions for Global Securities .
 
        If the Company shall establish, pursuant to or as contemplated by Section 2.3 , that the Debt Securities of a series are to be issued in whole or in part in the form of one or more Global Securities, then the Company shall execute and the Trustee shall, in accordance with Section 2.2 , authenticate and deliver one or more Global Securities in temporary or permanent form that (i) shall represent and shall be denominated in an amount equal to the aggregate principal amount of the outstanding Debt Securities of such series to be represented by one or more Global Securities, (ii) shall be registered, if in registered form, in the name of the Depositary for such Global Security or Global Securities or the nominee of such Depositary, (iii) shall be delivered by the Trustee to such Depositary or pursuant to such Depositary ’ s instruction, and (iv) shall bear a legend as set forth in an indenture supplemental hereto.
 
 
 
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        Each Depositary designated pursuant to or as contemplated by Section 2.3 for a Global Security to be delivered in the United States must, at the time of its designation and at all times while it serves as Depositary, be a clearing agency registered under the Exchange Act and any other applicable statute or regulation.
 
        If at any time the Depositary for the Debt Securities of a series notifies the Company that it is unwilling or unable to continue as Depositary for the Debt Securities of such series, or the Depositary for the Debt Securities of a series ceases to be a clearing agency registered under the Exchange Act and any other applicable statute or regulation, at a time when the Depositary is required to be so registered in order to act as a depositary, and a successor depositary for the Debt Securities of such series is not appointed by the Company within 90 days after the Company receives such notice, the Company ’ s election pursuant to Section 2.3 shall no longer be effective with respect to the Debt Securities of such series and the Company shall execute and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Debt Securities of such series, shall authenticate and deliver as specified in such written order(s), Debt Securities of such series in definitive form in an aggregate principal amount equal to the principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities.
 
        The Company may at any time and in its sole discretion determine that the Debt Securities of any series issued in the form of one or more Global Securities shall no longer be represented by such Global Security or Securities. In such event, the Company shall execute and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, shall authenticate and deliver as specified in such written order(s), Debt Securities of such series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities.
 
        If specified pursuant to Section 2.3 with respect to a series of Debt Securities, the Depositary for such series of Debt Securities may surrender a Global Security for such series of Debt Securities in exchange in whole or in part for Debt Securities of such series in definitive form on such terms as are acceptable to the Company and such Depositary. Thereupon, the Company shall execute and the Trustee shall authenticate and deliver, without service charge:
 
                   (a)     to each Person specified by such Depositary, a new Debt Security or Debt Securities of the same series, of any authorized denomination as requested by such Person, in aggregate principal amount equal to, and in exchange for, such Person ’ s beneficial interest in the Global Security; and
 
 
 
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                   (b)     to such Depositary, a new Global Security in a denomination equal to the difference, if any, between the principal amount of the surrendered Global Security and the aggregate principal amount of Debt Securities so delivered to Holders thereof.
 
        In any such exchange, the Company shall execute and the Trustee shall authenticate and deliver, Debt Securities in definitive registered form in authorized denominations.
 
        Upon the exchange of a Global Security for Debt Securities in definitive form, such Global Security shall be cancelled by the Trustee. Debt Securities issued in exchange for a Global Security pursuant to Section 2.8 shall be registered in such names in writing and in such authorized denominations as the Depositary for such Global Security shall instruct the Trustee. The Trustee shall deliver such Debt Securities to the Persons in whose names such Debt Securities are so registered.
 
        SECTION 2.5 Registrar and Paying Agent . The Company shall maintain an office or agency where Debt Securities may be presented for registration of transfer or for exchange (the “ Registrar ”) and an office or agency where Debt Securities may be presented for payment (the “ Paying Agent ” ). The Registrar shall keep a register of the Debt Securities and of their transfer and exchange (the “ Security Register ”). The Company may have one or more co-registrars and one or more additional paying agents with respect to any series of Debt Securities. The term “Paying Agent” includes any additional paying agent.
 
        The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent or co-registrar not a party to this Indenture, which shall incorporate the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to such agent. The Company shall promptly notify the Trustee in writing of the name and address of each such agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7 and the privileges, rights and immunities granted to the Trustee pursuant to Article VII . The Company or any of its Subsidiaries may act as Paying Agent, Registrar, co-registrar or transfer agent.
 
        The Company initially appoints the Trustee as Registrar and Paying Agent for the Debt Securities.
 
        SECTION 2.6 Paying Agent To Hold Money in Trust . By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Debt Security is due and payable, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal or interest when due. The Company shall require each Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by such Paying Agent for the payment of principal of or interest on the Debt Securities and shall promptly notify the Trustee in writing of any default by the Company in making any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee and to account for any funds disbursed by such Paying Agent. Upon complying with this Section 2.6 , the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money delivered to the Trustee. Upon any bankruptcy, reorganization or similar proceeding with respect to the Company, the Trustee shall serve as Paying Agent for the Debt Securities.
 
 
 
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        SECTION 2.7 Holder Lists . The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders of each series of Debt Securities and shall otherwise comply with TIA Section 312(a). If the Trustee is not the Registrar, or to the extent otherwise required under the TIA, the Company shall furnish to the Trustee, in writing at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders of a particular series of Debt Securities and the Company shall otherwise comply with TIA Section 312(a).
 
      SECTION 2.8 Transfer and Exchange .
 
                   (a)    At the option of the Holder, Debt Securities of any series (except a Global Security) may be exchanged for other Debt Securities of the same series and of like tenor, of any authorized denominations and of a like aggregate principal amount and Stated Maturity upon surrender of the Debt Securities to be exchanged at an office or agency maintained in accordance with Section 3.4 . Whenever any Debt Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver the Debt Securities that the Holder making the exchange is entitled to receive.
 
                       Notwithstanding any other provision of this Section 2.8 , unless and until it is exchanged in whole or in part for Debt Securities in definitive registered form, a Global Security representing all or a portion of the Debt Securities of a series may not be transferred except as a whole by the Depositary to the nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or to a nominee of such successor Depositary.
 
                       The Company shall not be required (i) to issue, register the transfer of or exchange Debt Securities of any particular series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of Debt Securities of such series selected for redemption and ending at the close of business on the day of such mailing, (ii) to register the transfer of or to exchange any Debt Security so selected for redemption in whole or in part, except the unredeemed portion of any Debt Security being redeemed in part or (iii) to register the transfer of or to exchange any Debt Security between a record date for the payment of interest on such Debt Security and the next succeeding interest payment date.
 
                   (b)     Obligations with Respect to Transfers and Exchanges of Debt Securities .
 
                       (i)        Upon surrender for registration of transfer of any Debt Security of any series at an office or agency maintained in accordance with Section 3.4 , the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Debt Securities of the same series and of like tenor, of any authorized denominations and of a like aggregate principal amount and Stated Maturity.
 
 
 
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                       (ii)        No service charge shall be made to a Holder for any registration of transfer or exchange, but the Company may require from a Holder payment of a sum sufficient to cover any transfer tax, assessments or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant to Section 9.5 ).
 
                       (iii)        The Registrar or co-registrar shall not be required (A) to issue, register the transfer of or exchange any Debt Security of any particular series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of Debt Securities of such series selected for redemption and ending at the close of business on the day of such mailing, (B) to register the transfer of or to exchange any Debt Security so selected for redemption in whole or in part, except the unredeemed portion of any Debt Security being redeemed in part, or (C) to register the transfer of or to exchange any Debt Security between a record date for the payment of interest on such Debt Security and the next succeeding interest payment date.
 
                       (iv)        Prior to the due presentation for registration of transfer of any Debt Security, the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar may deem and treat the Person in whose name a Debt Security is registered as the absolute owner of such Debt Security for the purpose of receiving payment of principal of and interest on such Debt Security and for all other purposes whatsoever, whether or not such Debt Security is overdue, and neither the Company, the Trustee, the Paying Agent, the Registrar nor any co-registrar shall be affected by notice to the contrary.
 
                       (v)        All Debt Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Debt Securities surrendered upon such transfer or exchange.
 
                       (vi)        Every Debt Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by the Holder thereof or his attorney duly authorized in writing.
 
                       (vii)        Each Holder of a Debt Security agrees to indemnify the Company, the Trustee, the Paying Agent and the Registrar against any liability that may result from the transfer, exchange or assignment of such Holder’s Debt Security in violation of any provision of this Indenture, any indenture supplemental hereto and/or applicable United States federal or state securities law.
 
                       (viii)        The Trustee, any Paying Agent or Registrar and the Company shall not have any responsibility or liability for any action taken or not taken by the Depositary.
 
                   (f)     No Obligation of the Trustee . The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Debt Security (including any transfers between or among Depositary participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
 
 
 
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        SECTION 2.9 Mutilated, Destroyed, Lost or Stolen Debt Securities . If a mutilated Debt Security of any series is surrendered to the Registrar or if the Holder of a Debt Security claims that the Debt Security has been lost, destroyed or wrongfully taken, the Company shall execute and, upon Company Order, the Trustee shall authenticate a replacement Debt Security of the same series if the requirements of Section 8-405 of the Uniform Commercial Code are met, as determined by the Company, and the Holder satisfies any other reasonable requirements of the Trustee. Such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss that any of them may suffer if a Debt Security is replaced, and, in the absence of notice to the Company or the Trustee that such Debt Security has been acquired by a bona fide purchaser, the Company shall execute and upon Company Order the Trustee shall authenticate and make available for delivery, in exchange for any such mutilated Debt Security or in lieu of any such destroyed, lost or stolen Debt Security, a new Debt Security of the same series of like tenor and principal amount, bearing a number not contemporaneously outstanding.
 
        In case any such mutilated, destroyed, lost or stolen Debt Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Debt Security of the same series, pay such Debt Security.
 
        Upon the issuance of any new Debt Security under this Section 2.9 , the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith.
 
        Every new Debt Security issued pursuant to this Section 2.9 in lieu of any mutilated, destroyed, lost or stolen Debt Security shall constitute an original additional contractual obligation of the Company and any other obligor upon the Debt Securities, whether or not the mutilated, destroyed, lost or stolen Debt Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Debt Securities of the same series duly issued hereunder.
 
        The provisions of this Section 2.9 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Debt Securities.
 
        SECTION 2.10 Outstanding Debt Securities . Debt Securities of any series outstanding at any time are all Debt Securities of such series authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those paid pursuant to Section 2.9 and those described in this Section 2.10 as not outstanding. A Debt Security ceases to be outstanding in the event the Company or a Subsidiary holds the Debt Security; provided, however, that (a) for purposes of determining which Debt Securities of a particular series are outstanding for consent or voting purposes hereunder, Debt Securities of any series shall cease to be outstanding in the event the Company or an Affiliate of the Company holds the Debt Security of such series and (b) in determining whether the Trustee shall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Debt Securities of such series are present at a meeting of Holders of Debt Securities of such series for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Debt Securities of such series that a Trust Officer of the Trustee actually knows to be held by the Company or an Affiliate of the Company shall not be considered outstanding.
 
 
 
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        If a Debt Security is replaced pursuant to Section 2.9 , it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Debt Security is held by a bona fide purchaser.
 
        If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Debt Securities of a particular series (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Debt Securities (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
 
        SECTION 2.11 Temporary Debt Securities . Until definitive Debt Securities of any series are ready for delivery, the Company may execute and, upon Company Order, the Trustee shall authenticate temporary Debt Securities of such series. Temporary Debt Securities of any series shall be substantially in the form of definitive Debt Securities of such series but may have variations that the Company considers appropriate for temporary Debt Securities. If temporary Debt Securities of any series are issued, the Company shall execute and, upon Company Order, the Trustee shall authenticate definitive Debt Securities of such series without unreasonable delay. After the preparation of definitive Debt Securities of any series, the temporary Debt Securities of such series shall be exchangeable for definitive Debt Securities of such series upon surrender of such temporary Debt Securities at any office or agency maintained by the Company for that purpose and such exchange shall be without charge to the Holder of such temporary Debt Securities. Upon surrender for cancellation of any one or more temporary Debt Securities of any series, the Company shall execute, and the Trustee shall authenticate and make available for delivery in exchange therefor, one or more definitive Debt Securities of such series representing an equal principal amount of Debt Securities of such series. Until so exchanged, the Holder of temporary Debt Securities of any series shall in all respects be entitled to the same benefits under this Indenture as a holder of definitive Debt Securities of such series.
 
        SECTION 2.12 Cancellation . The Company at any time may deliver Debt Securities previously authenticated and delivered hereunder to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Debt Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel and return to the Company all Debt Securities surrendered for registration of transfer, exchange, payment or cancellation. The Company may not issue new Debt Securities to replace Debt Securities it has paid or delivered to the Trustee for cancellation for any reason other than in connection with a transfer or exchange.
 
        SECTION 2.13 Payment of Interest; Defaulted Interest . Interest on any Debt Security that is payable, and is punctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Debt Security (or one or more predecessor Debt Securities) is registered at the close of business on the regular record date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 2.5 .
 
 
 
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        Any interest on any Debt Security of any series that is payable, but is not paid when the same becomes due and payable and such nonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder thereof on the regular record date by virtue of having been such Holder, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Debt Securities of such series (such defaulted interest and interest thereon herein collectively called “ Defaulted Interest ” ) shall be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:
 
        (a)    The Company may elect to make payment of any Defaulted Interest on the Debt Securities of any series to the Persons in whose names such Debt Securities (or their respective predecessor Debt Securities) are registered at the close of business on a Special Record Date (as defined below) for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Debt Security of such series and the date (not less than 30 days after such notice) of the proposed payment (the “ Special Interest Payment Date ” ), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a record date (the “ Special Record Date ”) for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the Special Interest Payment Date. The Trustee shall promptly notify the Company of such Special Record Date, and in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor to be given in the manner provided for in Section 10.2 , not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names the Debt Securities (or their respective predecessor Debt Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (b).
 
        (b)    The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Debt Securities may be listed, and upon such notice as may be required by such exchange, if, after written notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.
 
        Subject to the foregoing provisions of this Section 2.13 , each Debt Security of any series delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Debt Security of such series shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Debt Security of such series.
 
        SECTION 2.14 Computation of Interest . Interest on the Debt Securities shall be computed on the basis of a 360-day year of twelve 30-day months.
 
 
 
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        SECTION 2.15 CUSIP and ISIN Numbers . The Company in issuing Debt Securities of any series may use “CUSIP” and “ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however , that any such notice by the Company or the Trustee may state that no representation is made as to the correctness of such numbers either as printed on such Debt Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on such Debt Securities, and any such redemption shall not be affected by any defect in or omission of such CUSIP or ISIN numbers. The Company shall promptly notify the Trustee in writing of any change in the CUSIP and ISIN numbers.
 
ARTICLE III
Covenants
 
        The Company agrees to be bound by the following covenants for the benefit of the Holders of the Debt Securities of each series issued under this Indenture:
 
        SECTION 3.1 Payment of Debt Securities . The Company shall promptly pay the principal of and interest on the Debt Securities of the applicable series on the dates and in the manner provided in the Debt Securities of that series and in this Indenture. Principal and interest shall be considered paid on the date due if on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Holders on that date.
 
        The Company shall pay interest on overdue principal at the rate specified therefor in the Debt Securities of the applicable series, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
 
        The principal of and premium, if any, and interest on the Debt Securities shall be payable at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 ; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Security Register. Payments in respect of Debt Securities represented by a Global Security (including principal and interest) shall be made by wire transfer of immediately available funds to the accounts specified by the Depositary. Payments in respect of Debt Securities represented by definitive Debt Securities (including principal and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Debt Securities represented by definitive Debt Securities shall be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
        Notwithstanding anything to the contrary contained in this Indenture, the Company may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder.
 
 
 
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      SECTION 3.2 Limitation on Liens.
 
        (a)    The Company will not, and will not permit any Subsidiary to, directly or indirectly, as security for any Debt, mortgage, pledge or create or permit to exist any lien on any shares of stock, indebtedness or other obligations of a Subsidiary or any Principal Property, whether such shares of stock, indebtedness or other obligations of a Subsidiary or Principal Property are owned at the date of the Indenture or hereafter acquired, unless the Company secures or causes to be secured any outstanding Debt Securities of the applicable series equally and ratably with all Debt secured by such mortgage, pledge or lien, so long as that Debt shall be secured; provided , however , that the foregoing limitation shall not apply in the case of (i) the creation of any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property acquired after the date that the Debt Securities of the applicable series are first issued (including acquisitions by way of merger or consolidation) by the Company or a Subsidiary contemporaneously with such acquisition, or within 120 days thereafter, to secure or provide for the payment or financing of any part of the purchase price thereof, or the assumption of any mortgage, pledge or other lien upon any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property acquired after such date and existing at the time of such acquisition, or the acquisition of any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property subject to any mortgage, pledge or other lien without the assumption thereof, provided that any mortgage, pledge or lien referred to in this clause (i) shall attach only to the shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property so acquired and fixed improvements thereon, (ii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property existing on the date that the Debt Securities of the applicable series are first issued, (iii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property in favor of the Company or any Subsidiary, (iv) any mortgage, pledge or other lien on a Principal Property being constructed or improved securing Debt incurred to finance the construction or improvements, (v) any mortgage, pledge or other lien on shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property incurred in connection with the issuance by a state or political subdivision thereof of any securities the interest on which is exempt from federal income taxes by virtue of Section 103 of the United States Internal Revenue Code of 1986, as amended, or any other laws and regulations in effect at the time of such issuance and (vi) any renewal of or substitution for any mortgage, pledge or other lien permitted by any of the preceding clauses (i) through (v), provided, in the case of a mortgage, pledge or other lien permitted under clause (i), (ii) or (iv), the Debt secured is not increased nor the lien extended to any additional assets.
 
        (b)    Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may create or assume liens in addition to those permitted by the foregoing paragraph (a), and renew, extend or replace such liens, provided that at the time of such creation, assumption, renewal, extension or replacement, and after giving effect thereto, Exempted Debt with respect to the applicable series of the Debt Securities does not exceed 15% of Consolidated Net Tangible Assets.
 
 
 
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       SECTION 3.3 Limitation on Sale Leaseback Transactions.
 
        (a)    The Company will not, and will not permit, any Subsidiary to, sell or transfer, directly or indirectly, except to the Company or a Subsidiary, a Principal Property as an entirety, or any substantial portion thereof, with the intention of taking back a lease of all or part of such property except a lease for a period of three years or less at the end of which it is intended that the use of such property by the lessee will be discontinued, provided that, notwithstanding the foregoing, the Company or any Subsidiary may sell a Principal Property and lease it back for a longer period (i) if the Company or such Subsidiary would be entitled, pursuant to Section 3.2 , to create a mortgage on the property to be leased securing Debt in an amount equal to the Attributable Debt with respect to the sale and leaseback transaction without equally and ratably securing the outstanding Debt Securities of the applicable series or (ii) if (A) the Company promptly informs the Trustee of such transactions, (B) the net proceeds of such transaction are at least equal to the fair value (as determined by a Board Resolution delivered to the Trustee) of such property and (C) the Company causes an amount equal to the net proceeds of the sale to be applied to the retirement (whether by redemption, cancellation after open-market purchases, or otherwise), within 120 days after receipt of such proceeds, of Funded Debt having an outstanding principal amount equal to the net proceeds.
 
        (b)    Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may enter into sale and leaseback transactions in addition to those permitted by the foregoing paragraph (a), and without any obligation to retire any outstanding Funded Debt, provided that at the time of entering into such sale and leaseback transactions and after giving effect thereto, Exempted Debt with respect to the applicable series of the Debt Securities does not exceed 15% of Consolidated Net Tangible Assets.
 
        SECTION 3.4 Maintenance of Office or Agency . The Company shall maintain an office or agency where the Debt Securities of the applicable series may be presented or surrendered for payment, where, if applicable, the Debt Securities of the applicable series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Debt Securities of the applicable series and this Indenture may be served. The Corporate Trust Office of the Trustee shall be such office or agency of the Company, unless the Company shall designate and maintain some other office or agency for one or more of such purposes. The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
 
        The Company may also from time to time designate one or more other offices or agencies where the Debt Securities of the applicable series may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation. The Company shall give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such other office or agency.
 
        SECTION 3.5 Compliance Certificate . The Company shall deliver to the Trustee within 120 days after the end of each Fiscal Year of the Company an Officers’ Certificate stating that in the course of the performance by the signers of their duties as Officers of the Company they would normally have knowledge of any Default or Event of Default with respect to any series of the Debt Securities and whether or not the signers know of any Default or Event of Default with respect to any series of the Debt Securities that occurred during such period. If they do, the certificate shall describe the Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto. The Company also shall comply with TIA Section 314(a)(4).
 
 
 
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        SECTION 3.6 Statement by Officers as to Default . The Company shall deliver to the Trustee within 10 days after the Company becomes aware of the occurrence of any Event of Default with respect to any series of the Debt Securities or an event that, with notice or the lapse of time or both, would constitute an Event of Default with respect to any series of the Debt Securities, an Officers ’ Certificate setting forth the details of such Default or Event of Default and the action that the Company proposes to take with respect thereto.
 
        SECTION 3.7 Further Instruments and Acts . Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
 
ARTICLE IV
Successor Company
 
        SECTION 4.1 Merger, Consolidation or Sale of All or Substantially All Assets of the Company .
 
        (a)    The Company shall not consolidate with or merge into, or transfer, directly or indirectly, all or substantially all of its assets to another corporation or other Person unless (a) the resulting, surviving or transferee corporation or other Person assumes by supplemental indenture all of the obligations of the Company under each series of Debt Securities and this Indenture, (b) immediately after giving effect to such transaction, no Event of Default, and no circumstances that, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing, and (c) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture comply with this Indenture, and thereafter all such obligations of the Company shall terminate.
 
        (b)    The resulting, surviving or transferee corporation will succeed to and be substituted for the Company with the same effect as if it had been named herein as a party hereto, and thereafter the predecessor corporation will be relieved of all obligations and covenants under this Indenture and the Debt Securities.
 
ARTICLE V
Redemption of Securities
 
        SECTION 5.1 Optional Redemption . The Debt Securities of any series may be redeemed, at the option of the Company, at any time in whole, or from time to time in part, subject to the conditions and at the redemption prices specified by the terms of that series, together with accrued and unpaid interest to the Redemption Date.
 
 
 
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        SECTION 5.2 Applicability of Article . Redemption of the Debt Securities of any series at the election of the Company or otherwise, as permitted by the terms of such series of Debt Securities, shall be made in accordance with such terms and this Article V; provided , however , that, notwithstanding anything to the contrary in this Article V , if any such terms of a series of Debt Securities shall conflict with any provisions of this Article V , the terms of such series shall govern.
 
        SECTION 5.3 Election to Redeem; Notice to Trustee . The election of the Company to redeem any of the Debt Securities of any series pursuant to Section 5.1 shall be evidenced by a Board Resolution. In case of any redemption at the election of the Company, the Company shall, upon not later than the earlier of the date that is 30 days prior to the Redemption Date fixed by the Company or the date on which notice is given to the Holders (except as provided in Section 5.5 or unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee in writing of the Redemption Date, the series of the Debt Securities to be redeemed and the principal amount of the Debt Securities of such series to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select such Debt Securities to be redeemed pursuant to Section 5.4 .
 
        SECTION 5.4 Selection by Trustee of Debt Securities to Be Redeemed . If less than all of the Debt Securities of any series are to be redeemed at the option of the Company (unless all of the Debt Securities of such series are to be redeemed), the particular Debt Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee from the outstanding Debt Securities of such series not previously called for redemption, in compliance with the requirements of the principal national securities exchange, if any, on which such Debt Securities are listed, or, if such Debt Securities are not so listed, then on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements) and which may provide for the selection for redemption of portions of the principal of the Debt Securities of such series; provided, however, that (a) Debt Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (b) no such partial redemption shall reduce the portion of the principal amount of a Debt Security not redeemed to less than $1,000.
 
        The Trustee shall promptly notify the Company in writing of the Debt Securities selected for redemption and, in the case of any Debt Securities selected for partial redemption, the principal amount thereof to be redeemed. If the Debt Securities of any series to be redeemed consist of Debt Securities having different dates on which the principal is payable or different rates of interest, or different methods by which interest may be determined or have any other terms, then the Company may, by written notice to the Trustee, direct that the Debt Securities of such series to be redeemed shall be selected from among the groups of such Debt Securities having specified terms and the Trustee shall thereafter select the particular Debt Securities to be redeemed in the manner set forth in the preceding paragraph from among the group of such Debt Securities so specified.
 
        For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Debt Securities shall relate, in the case of any Debt Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Debt Security which has been or is to be redeemed.
 
 
 
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        SECTION 5.5 Notice of Redemption . Notice of redemption shall be given in the manner provided for in Section 10.2 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Debt Securities to be redeemed. The Trustee shall give notice of redemption in the Company ’ s name and at the Company’s expense; provided, however, that the Company shall deliver to the Trustee, at least 15 days prior to the date on which such notice is to be given, an Officers’ Certificate requesting that the Trustee give such notice and attaching a copy of such notice.
 
        All notices of redemption shall state:
 
        (a)    the Redemption Date;
 
        (b)    the redemption price and the amount of accrued interest to the Redemption Date, if any, payable as provided in Section 5.7;
 
        (c)    if less than all outstanding Debt Securities of any series are to be redeemed, the identification of the particular Debt Securities of such series (or portion thereof) to be redeemed, as well as the aggregate principal amount of Debt Securities of such series to be redeemed and the aggregate principal amount of Debt Securities of such series to be outstanding after such partial redemption;
 
        (d)    in case any Debt Security of a series is to be redeemed in part only, the notice which relates to such Debt Security shall state that on and after the Redemption Date, upon surrender of such Debt Security, the Holder will receive, without charge, a new Debt Security or Debt Securities of the same series and tenor in authorized denominations for the principal amount thereof remaining unredeemed;
 
        (e)    that on the Redemption Date the redemption price (and accrued interest, if any, to the Redemption Date payable as provided in Section 5.7 ) will become due and payable upon each such Debt Security, or the portion thereof, to be redeemed, and, unless the Company defaults in making the redemption payment, that interest on Debt Securities called for redemption (or the portion thereof) will cease to accrue on and after said date;
 
        (f)    the place or places where such Debt Securities are to be surrendered for payment of the redemption price and accrued interest, if any;
 
        (g)    the name and address of the Paying Agent;
 
        (h)    that Debt Securities called for redemption must be surrendered to the Paying Agent to collect the redemption price;
 
        (i)    the CUSIP and ISIN numbers, and that no representation is made as to the accuracy or correctness of the CUSIP and ISIN numbers, if any, listed in such notice or printed on such Debt Securities; and
 
        (j)    the paragraph of the Debt Securities pursuant to which the Debt Securities are to be redeemed.
 
 
 
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        SECTION 5.6 Deposit of Redemption Price . Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 2.6 ) an amount of money sufficient to pay the redemption price of, and accrued interest on, all the Debt Securities that are to be redeemed on that date.
 
        SECTION 5.7 Debt Securities Payable on Redemption Date . Notice of redemption having been given as aforesaid, the Debt Securities so to be redeemed shall, on the Redemption Date, become due and payable at the redemption price therein specified (together with accrued interest, if any, to the Redemption Date), and from and after such date (unless the Company shall default in the payment of the redemption price and accrued interest) such Debt Securities shall cease to bear interest. Upon surrender of any such Debt Security for redemption in accordance with said notice, such Debt Security shall be paid by the Company at the redemption price, together with accrued interest, if any, to the Redemption Date (subject to the rights of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).
 
        If any Debt Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid, bear interest from the Redemption Date at the rate prescribed therefor in such Debt Security.
 
        SECTION 5.8 Debt Securities Redeemed in Part . Any Debt Security that is to be redeemed only in part pursuant to the provisions of this Article V shall be surrendered at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Debt Security at the expense of the Company, a new Debt Security or Debt Securities of the same series and tenor, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Debt Security so surrendered, provided that each such new Debt Security will be in a principal amount of $1,000 or integral multiple thereof.
 
ARTICLE VI
Defaults and Remedies
 
        SECTION 6.1 Events of Default . Each of the following shall constitute an “ Event of Default ” with respect to the Debt Securities of each series:
 
        (a)    the Company defaults in any payment of interest on any Debt Security of such series when the same becomes due and payable, and such default continues for a period of 30 days;
 
        (b)    the Company defaults in the payment of the principal on any Debt Security of such series when the same becomes due and payable at its Stated Maturity, upon optional redemption, upon declaration or otherwise;
 
 
 
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        (c)    the Company defaults in the performance of or breaches any covenant or agreement in this Indenture or under the Debt Securities of such series or the supplemental indenture related to the Debt Securities of such series, other than those referred to in paragraph (a) or (b) above, and such default continues for 30 days after written notice (which notice must specify the default, demand that it be remedied and state that the notice is a “ Notice of Default ”) to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the outstanding Debt Securities of such series;
 
        (d)    the Company or any of its Subsidiaries fails to pay, in accordance with its terms and when payable, any of the principal, interest or additional amounts, if any, on any Debt (including the Debt Securities, other than the Debt Securities, if any, with respect to which the failure to pay principal, interest or additional interest is also an Event of Default under Section 6.1(a) , 6.1(b) or both) having, in the aggregate, a then-outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (ii) the maturity of Debt in an aggregate principal amount in excess of $50,000,000 is accelerated, if such acceleration results from a default under the instrument giving rise to or securing such Debt; provided , however , that, subject to Section 7.1 , the Trustee will not be deemed to have knowledge of such nonpayment or other default unless either (1) a Responsible Officer of the Trustee has actual knowledge of nonpayment or other default, or (2) the Trustee has received written notice thereof from the Company, from any Holder, from the holder of any such Debt or from the trustee under the agreement or instrument relating to such Debt;
 
        (e)    the Company pursuant to or within the meaning of any Bankruptcy Law (as defined below):
 
                   (i)        commences a voluntary case;
 
                   (ii)       consents to the entry of an order for relief against it in an involuntary case;
 
                   (iii)      consents to the appointment of a Custodian (as defined below) of it or for any substantial part of its property; or
 
                   (iv)      makes a general assignment for the benefit of its creditors; or
 
        (f)    a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
 
                   (i)        is for relief against the Company in an involuntary case;
 
                   (ii)       appoints a Custodian of the Company for all or substantially all of the Company’s property; or
 
                   (iii)      orders the winding up or liquidation of the Company; and
 
        in each case the order or decree remains unstayed and in effect for 60 days.
 
 
 
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        The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.
 
        The term “ Bankruptcy Law ” means Title 11, United States Code , as amended from time to time, or any similar federal or state law for the relief of debtors. The term “ Custodian ” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
 
        SECTION 6.2 Acceleration . If an Event of Default described in clauses (a), (b), (c) and (d) of Section 6.1 occurs with respect to any series of Debt Securities and is continuing, the Trustee, or the Holders of at least 25% in outstanding principal amount of the Debt Securities of such series, by notice to the Company, may, and the Trustee at the written request of such Holders shall, declare the principal of and premium and accrued and unpaid interest, if any, on all the Debt Securities of such series to be due and payable. Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable. If an Event of Default described in clauses (e) and (f) above occurs and is continuing, the principal of and premium and accrued and unpaid interest on all of the Debt Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders of the Debt Securities of such series.
 
        SECTION 6.3 Other Remedies . If an Event of Default occurs with respect to any series of Debt Securities and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of or interest on the Debt Securities of such series or to enforce the performance of any provision of the Debt Securities of such series or this Indenture.
 
        The Trustee may maintain a proceeding even if it does not possess any of the Debt Securities of such series or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of the Debt Securities of such series in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative.
 
        SECTION 6.4 Waiver of Existing Defaults . The Holders of a majority in principal amount of the outstanding Debt Securities of any series by written notice to the Trustee may (a) waive, by their consent (including, without limitation consents obtained in connection with a purchase of, or tender offer or exchange offer for, Debt Securities of such series), an existing Default or Event of Default with respect to the Debt Securities of that series and its consequences except (i) a Default or Event of Default in the payment of the principal of or interest on a Debt Security of such series or (ii) a Default or Event of Default in respect of a provision that under Section 9.2 cannot be amended without the consent of each Holder of the Debt Securities of such series affected and (b) rescind any such acceleration with respect to the Debt Securities of such series and its consequences if (i) rescission would not conflict with any judgment or decree of a court of competent jurisdiction and (ii) all existing Events of Default, other than the nonpayment of the principal of and interest on the Debt Securities of such series that have become due solely by such declaration of acceleration, have been cured or waived. When a Default or Event of Default is waived for any series of Debt Securities, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default of such or any other series or impair any consequent right.
 
 
 
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        SECTION 6.5 Control by Majority . The Holders of a majority in principal amount of the outstanding Debt Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee, as such remedy, trust or power relates to the Debt Securities of that series. The Trustee may, however, refuse to follow any direction that conflicts with law or this Indenture or, subject to Section 7.1 and Section 7.2 , that the Trustee determines is unduly prejudicial to the rights of other Holders of the Debt Securities of any series or would involve the Trustee in personal liability; provided, however , that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any action hereunder, the Trustee shall be entitled to security or indemnification reasonably satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.
 
        SECTION 6.6 Limitation on Suits . Subject to Section 6.7 , a Holder of Debt Securities of any series may not pursue any remedy with respect to this Indenture or the Debt Securities of such series unless:
 
        (a)    the Holder gives to the Trustee written notice stating that an Event of Default with respect to the Debt Securities of such series is continuing;
 
        (b)    the Holders of at least 25% in outstanding principal amount of the Debt Securities of such series make a written request to the Trustee to pursue the remedy;
 
        (c)    such Holder or Holders offer to the Trustee security or indemnity reasonably satisfactory to the Trustee against any loss, liability or expense;
 
        (d)    the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and
 
        (e)    the Holders of a majority in principal amount of the Debt Securities of such series do not give the Trustee a direction that is inconsistent with such request during such 60-day period.
 
        A Holder of Debt Securities of any series may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder, it being understood and intended that no one or more of such Holders will have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb, or prejudice the rights of any other of such Holders (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances are unduly prejudicial to such Holders).
 
        SECTION 6.7 Rights of Holders to Receive Payment . Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.6 ), the right of any Holder to receive payment of principal of or interest on the Debt Securities held by such Holder, on or after the respective due dates expressed in the Debt Securities, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.
 
 
 
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        SECTION 6.8 Collection Suit by Trustee . If an Event of Default specified in Section 6.1(a) or (b) with respect to any series of the Debt Securities occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount then due and owing (together with interest on any unpaid interest to the extent lawful) with respect to that series and the amounts provided for in Section 7.7 .
 
        SECTION 6.9 Trustee May File Proofs of Claim . The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company, its Subsidiaries or its or their respective creditors or properties, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under this Indenture, including, but not limited to, Section 7.7 . Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Debt Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
 
        SECTION 6.10 Priorities . If the Trustee collects any money or property pursuant to this Article VI on behalf of Holders of the Debt Securities of any series, it shall pay out the money or property in the following order:
 
          FIRST: to the Trustee for amounts due under Section 7.7 ;

          SECOND: to Holders for amounts due and unpaid on the Debt Securities of the applicable series for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Debt Securities of the applicable series for principal and interest, respectively; and

          THIRD: to the Company.

        The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10 . At least 15 days before such record date, the Company shall mail to each Holder of the Debt Securities of the applicable series and the Trustee a notice that states the record date, the payment date and amount to be paid.
 
        SECTION 6.11 Undertaking for Costs . In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant, in the manner and to the extent provided in the Trust Indenture Act. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7 or a suit by Holders of more than 10% in outstanding principal amount of the Debt Securities of any series.
 
 
 
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ARTICLE VII
Trustee
 
        SECTION 7. 1 Duties of Trustee .
 
        (a)    If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person ’ s own affairs, provided that if an Event of Default occurs with respect to any series of Debt Securities and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders of Debt Securities of such series unless such Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against any loss, liability or expense (other than as provided in clause (c) below).
 
        (b)    With respect to all series of Debt Securities, except for those series with respect to which an Event of Default is continuing,
 
                   (i)        the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
 
                   (ii)        in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
 
        (c)    The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
 
                   (i)        this paragraph does not limit the effect of paragraph (b) of this Section 7.1 ;
 
                   (ii)        the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
 
 
 
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                   (iii)        the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Sections 6.2 , 6.4 or   6.5 .
 
        (d)    The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.
 
        (e)    Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
 
        (f)    No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
 
        (g)    Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.1 and to the provisions of the TIA.
 
        (h)    Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if evidenced by a Company Order.
 
        (i)    The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders of any series of Debt Securities unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to it against any loss, liability or expense (including reasonable attorneys’ fees and expenses) that might be incurred by it in compliance with such request or direction.
 
        SECTION 7.2 Rights of Trustee . Subject to Section 7.1 and with respect to each series of Debt Securities:
 
        (a)    The Trustee may conclusively rely on any document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document.
 
        (b)    Before the Trustee acts or refrains from acting, it may require the delivery of an Officers’ Certificate and/or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officers’ Certificate or Opinion of Counsel.
 
        (c)    The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
 
 
 
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        (d)    The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; provided, however, that the Trustee’s conduct does not constitute willful misconduct or negligence.
 
        (e)    The Trustee may consult with counsel of its selection, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Debt Securities shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
 
        (f)    The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make further inquiry or investigation into such facts or matters as it may see fit, personally or by agent or attorney, at the sole cost of the Company and with the Company’s cooperation and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
 
        (g)    The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
 
        (h)    In no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
 
        (i)    The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Debt Securities of the applicable series and this Indenture.
 
        (j)    The Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.
 
        SECTION 7.3 Individual Rights of Trustee . The Trustee in its individual or any other capacity may become the owner or pledgee of Debt Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights. The Trustee must, however, comply with Section 7.10 and Section 7.11 .
 
        SECTION 7.4 Trustee’s Disclaimer . The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Debt Securities, shall not be accountable for the Company’s use of the proceeds from the Debt Securities of any series and shall not be responsible for any statement of the Company in this Indenture or in any document issued in connection with the sale of Debt Securities or in Debt Securities other than the Trustee’s certificate of authentication.
 
 
 
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        SECTION 7.5 Notice of Defaults . If a Default or Event of Default occurs with respect to any series of Debt Securities and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall mail to each Holder of the Debt Securities of such series at the address set forth in the Security Register notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of or interest on any Debt Security of such series (including payments pursuant to the optional redemption provisions of such Debt Security), the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Holders of the Debt Securities of such series.
 
        SECTION 7.6 Reports by Trustee to Holders . The Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto. As promptly as practicable after each May 15 beginning with the May 15 following the date of this Indenture, and in any event prior to July 15 in each year, the Trustee shall mail to each Holder a brief report dated as of such May 15 that complies with TIA Section 313(a) if such report is required by such section.
 
        A copy of each report at the time of its mailing to Holders shall be filed with the SEC and each stock exchange (if any) on which Debt Securities of any series are listed. The Company agrees to promptly notify the Trustee in writing whenever the Debt Securities of any series become listed on any stock exchange and of any delisting thereof.
 
        SECTION 7.7 Compensation and Indemnity . The Company shall pay to the Trustee from time to time such compensation for its acceptance of this Indenture and services rendered by it hereunder as the Company and the Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses, disbursements and advances incurred or made by it, including costs of collection, costs of preparing and reviewing reports, certificates and other documents, costs of preparation and mailing of notices to Holders and reasonable costs of counsel retained by the Trustee in connection with the delivery of an Opinion of Counsel or otherwise, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee ’ s agents, counsel, accountants and experts. The Company shall indemnify the Trustee and its agents appointed hereunder against any and all loss, liability, damages, claims or expense (including reasonable attorneys’ fees and expenses) incurred by them without negligence or bad faith on their part in connection with the acceptance or administration of this trust and the performance of their duties hereunder, including the costs and expenses of enforcing this Indenture (including this Section 7.7 ) and of defending themselves against any claims (whether asserted by any Holder, the Company or otherwise). The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee shall provide reasonable cooperation in the defense. The Trustee may have separate counsel and the Company shall pay the fees and expenses of such counsel, provided that the Company shall not be required to pay such fees and expenses if it assumes the Trustee’s defense, and, in the reasonable judgment of counsel to the Trustee, there is no conflict of interest between the Company and the Trustee in connection with such defense. The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
 
 
 
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        To secure the Company ’ s payment obligations in this Section 7.7 the Trustee shall have a lien prior to the Debt Securities on all money or property held or collected by the Trustee, other than money or property held in trust to pay principal of and interest on particular Debt Securities. The Trustee ’ s right to receive payment of any amounts due under this Section 7.7 shall not be subordinate to any other liability or Debt of the Company.
 
        The Company’s payment obligations pursuant to this Section 7.7 shall survive the discharge of this Indenture. When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.1(e) or (f) with respect to the Company, the expenses are intended to constitute expenses of administration under any Bankruptcy Law.
 
        SECTION 7.8 Replacement of Trustee . The Trustee may resign at any time with respect to the Debt Securities of any series by so notifying the Company. The Holders of a majority in principal amount of the outstanding Debt Securities of any series may remove the Trustee with respect to that series by so notifying the Trustee and may appoint a successor Trustee with respect to that series. The Company shall remove the Trustee if:
 
        (a)    the Trustee fails to comply with Section 7.10 ;
 
        (b)    the Trustee is adjudged bankrupt or insolvent;
 
        (c)    a receiver or other public officer takes charge of the Trustee or its property; or
 
        (d)    the Trustee otherwise becomes incapable of acting.
 
        If the Trustee resigns or is removed by the Company or by the Holders of a majority in principal amount of the outstanding Debt Securities of any series and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of the Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee with respect to any applicable series.
 
        A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.7 .
 
        In the case of the appointment hereunder of a successor Trustee with respect to the Debt Securities of one or more (but not all) series, the Company, the predecessor Trustee and each successor Trustee with respect to the Debt Securities of any applicable series shall execute and deliver an indenture supplemental hereto, which shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the predecessor Trustee with respect to the Debt Securities of any series as to which the predecessor Trustee is not retiring shall continue to be vested in the predecessor Trustee, and shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees as co-Trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee.
 
 
 
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        If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of 10% in principal amount of the Debt Securities of any series may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee, in the case of the Holders of a series, a successor Trustee only with respect to that series.
 
        No successor Trustee with respect to any series of Debt Securities shall accept appointment as provided in this Section 7.8 unless at the time of such acceptance such successor Trustee shall with respect to such series be eligible under Section 7.10 . If the Trustee fails to comply with Section 7.10 , any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
 
        Notwithstanding the replacement of the Trustee pursuant to this Section 7.8 , the Company ’ s obligations under Section 7.7 shall continue for the benefit of the retiring Trustee.
 
        SECTION 7.9 Successor Trustee by Merger . If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.
 
        In case, at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture, any of the Debt Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee and deliver such Debt Securities so authenticated; and in case at that time any of the Debt Securities shall not have been authenticated, any successor to the Trustee may authenticate such Debt Securities, provided that the right to adopt the certificate of authentication of any predecessor Trustee shall only apply to its successor or successors by merger, consolidation or conversion.
 
        SECTION 7.10 Eligibility; Disqualification . The Trustee shall at all times satisfy the requirements of TIA Section 310(a). The Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition. The Trustee shall comply with TIA Section 310(b); provided, however , that there shall be excluded from the operation of TIA Section 310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in TIA Section 310(b)(1) are met.
 
 
 
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        SECTION 7.11 Preferential Collection of Claims Against Company . The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated.
 
ARTICLE VIII
Satisfaction and Discharge of Indenture
 
        SECTION 8.1 Option To Effect Legal Defeasance or Covenant Defeasance . The Company may, at the option of its Board of Directors evidenced by a Board Resolution, at any time, elect to have either Section 8.2 or Section 8.3 be applied to all outstanding Debt Securities of any series, upon compliance with the conditions set forth below in this Article VIII , unless pursuant to Section 2.3 , this Article VIII is not applicable with respect to the Debt Securities of such series.
 
        SECTION 8.2 Legal Defeasance and Discharge . Upon the Company ’ s exercise under Section 8.1 of the option applicable to this Section 8.2 with respect to the Debt Securities of any series, the Company shall be deemed to have been discharged from its obligations under this Indenture with respect to all outstanding Debt Securities of such series on the date the conditions set forth below are satisfied (hereinafter, “ Legal Defeasance ” ). For this purpose, such Legal Defeasance means that the Company shall be deemed to have paid and discharged all the obligations relating to the outstanding Debt Securities of such series, and such Debt Securities of such series shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.6 and Section 8.8 , and to have satisfied all of its other obligations under such Debt Securities of such series and this Indenture and to have cured all then existing Events of Default with respect to such Debt Securities of such series (and the Trustee, on demand of and at the written direction and expense of the Company shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Debt Securities of such series to receive payments in respect of the principal and accrued interest on such Debt Securities of such series when such payments are due or on the Redemption Date solely out of the trust created pursuant to this Indenture; (b) the rights, powers, trusts, duties and immunities of the Trustee, and the Company ’ s obligations in connection therewith; and (c) this Article VIII and the obligations set forth in Section 8.6 hereof.
 
        SECTION 8.3 Covenant Defeasance . Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.3 with respect to the Debt Securities of any series, the Company shall be released from any obligations under the covenants contained in Section 3.2 and Section 3.3 hereof with respect to the outstanding Debt Securities of such series on and after the date the conditions set forth below are satisfied (hereinafter, “ Covenant Defeasance” ), and the Debt Securities of such series shall thereafter be deemed not “outstanding ” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding ” for all other purposes hereunder (it being understood that such Debt Securities of such series shall not be deemed outstanding for accounting purposes). For this purpose, such Covenant Defeasance means that, with respect to the outstanding Debt Securities of such series, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default with respect to the Debt Securities of such series under Section 6.1(c) , nor shall any event referred to in Section 6.1(d) thereafter constitute a Default or Event of Default with respect to the Debt Securities of such series, but, except as specified above, the remainder of this Indenture and such Debt Securities of such series shall be unaffected thereby.
 
 
 
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        SECTION 8.4 Conditions to Legal or Covenant Defeasance . The following shall be the conditions to the application of either Section 8.2 or Section 8.3 to the outstanding Debt Securities of the applicable series:
 
        (a)    in the case of Legal Defeasance of such series, either (i) all Debt Securities of such series theretofore authenticated and delivered under the Indenture must have been delivered to the Trustee for cancellation or (ii) the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders of Debt Securities of such series, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Debt Securities of such series on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Debt Securities of such series;
 
        (b)    in the case of Covenant Defeasance of such series, the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders of Debt Securities of such series, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Debt Securities of such series on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Debt Securities of such series;
 
        (c)    in the case of Legal Defeasance of such series, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, (i) the Company has received from, or there has been published by, the U.S. Internal Revenue Service a ruling or (ii) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, subject to customary assumptions and exclusions, the Holders of Debt Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
 
        (d)    in the case of Covenant Defeasance of such series, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the Holders of Debt Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
 
 
 
38
 
        (e)    such Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument to which the Company is a party or by which the Company is bound;
 
        (f)    in the case of Legal Defeasance of such series, 91 days shall have passed during which no Event of Default relating to such series under Section 6.1(e) or Section 6.1(f) has occurred;
 
        (g)    the Company shall have delivered to the Trustee an Officers ’ Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided relating to the defeasance and discharge as contemplated by this Article VIII have been complied with; and
 
        (h)    the Company shall have delivered to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and accrued interest when due and without reinvestment on the deposited U.S. Government Securities plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal and accrued interest when due on all the Debt Securities of such series to maturity.
 
        SECTION 8.5 Satisfaction and Discharge of Indenture . This Indenture will be discharged with respect of the Debt Securities of any series and will cease to be of further effect as to all Debt Securities issued thereunder, when either (a) all Debt Securities of such series theretofore authenticated and delivered (except lost, stolen or destroyed Debt Securities that have been replaced or paid and Debt Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company) have been delivered to the Trustee for cancellation; or (b)(i) all Debt Securities of such series not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust an amount of money in U.S. dollars or U.S. Government Securities or any combination thereof sufficient to pay and discharge the entire indebtedness on the Debt Securities of such series not theretofore delivered to the Trustee for cancellation for principal and accrued and unpaid interest to the date of maturity or redemption; (ii) no Default with respect to the Debt Securities of such series shall have occurred within 91 days of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company is a party or by which it is bound; (iii) the Company has paid or caused to be paid all sums payable by it with respect to the Debt Securities of such series under this Indenture; and (iv) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of the Debt Securities of such series at maturity or the Redemption Date, as the case may be. In addition, with respect to clause (b) of the preceding sentence, the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, stating that all conditions precedent specified herein relating to the satisfaction and discharge of this Indenture have been complied with.
 
 
 
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        SECTION 8.6 Survival of Certain Obligations . Notwithstanding the satisfaction and discharge of this Indenture with respect to a series of Debt Securities referred to in Section 8.1 , Section 8.2 , Section 8.3 , Section 8.4 or Section 8.5 , the respective obligations of the Company and the Trustee under Section 2.2 , Section 2.3 , Section 2.4 , Section 2.5 , Section 2.6 , Section 2.7 , Section 2.8 , Section 2.9 , Section 2.10 , Section 2.11 , Section 2.12 , Section 3.4 , Section 3.5 , Section 3.6 , Section 3.7 , Section 6.7 , Section 7.2 , Section 7.3 , Section 7.7 , Section 7.8 and this Article VIII shall survive until the Debt Securities of such series are no longer outstanding and, thereafter, only the Company ’ s obligations in Section 7.7 shall survive such satisfaction and discharge. Nothing contained in this Article VIII shall abrogate any of the obligations or duties of the Trustee under this Indenture.
 
        SECTION 8.7 Acknowledgment of Discharge by Trustee . Subject to Section 8.10 , after (a) the conditions of Section 8.4 or Section 8.5 have been satisfied for the applicable series of Debt Securities, (b) the Company has paid or caused to be paid all other sums payable by the Company in connection with such series of Debt Securities and (c) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent referred to in clause (a) above relating to the satisfaction and discharge of this Indenture with respect to the applicable series of Debt Securities have been complied with, the Trustee upon written request by the Company shall acknowledge in writing the discharge of all of the Company’s obligations under this Indenture with respect to the applicable series of Debt Securities except for those surviving obligations specified in this Article VIII .
 
        SECTION 8.8 Application of Trust Moneys . All cash in U.S. dollars and U.S. Government Securities deposited with the Trustee pursuant to Section 8.4 or Section 8.5 shall be held in trust and applied by the Trustee, in accordance with the provisions of the Debt Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of Debt Securities of the applicable series, of all sums due and to become due thereon for principal and accrued interest but such money need not be segregated from other funds except to the extent required by law. The Holder of any Debt Security replaced pursuant to Section 2.9 shall not be entitled to any such payment and shall look only to the Company for any payment which such Holder may be entitled to collect. In connection with the satisfaction and discharge of this Indenture or the defeasance of certain obligations under this Indenture, the Company may direct the Trustee in writing to (a) invest any money received by the Trustee in the U.S. Government Securities deposited in trust in additional U.S. Government Securities, and (b) deliver or pay to the Company from time to time upon the request of the Company any money or U.S. Government Securities held by it, that, as evidenced by a certificate from a nationally recognized firm of independent accountants, are in excess of the amount thereof which would then have been required to be deposited for the purpose for which such money or U.S. Government Securities were deposited or received.
 
        The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Securities deposited pursuant to Section 8.4 or Section 8.5 or the principal or interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of such series of Debt Securities.
 
 
 
40
 
        SECTION 8.9 Repayment to the Company; Unclaimed Money . The Trustee and any Paying Agent shall promptly pay or return to the Company upon written request any cash or U.S. Government Securities held by them at any time that, in the opinion of a nationally recognized firm of independent public accountants evidenced by a written certification thereof delivered to the Trustee, are not required for the payment of the principal and interest on the Debt Securities of such series for which cash or U.S. Government Securities have been deposited pursuant to Section 8.4 or Section 8.5 .
 
        SECTION 8.10 Reinstatement . If the Trustee or Paying Agent is unable to apply any cash or U.S. Government Securities in accordance with Section 8.2 , Section 8.3 , Section 8.4 or Section 8.5 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the applicable series of Debt Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2 , Section 8.3 , Section 8.4 or Section 8.5 until such time as the Trustee or Paying Agent is permitted to apply all such cash or U.S. Government Securities in accordance with Section 8.2 , Section 8.3 , Section 8.4 or Section 8.5 ; provided, however , that if the Company has made any payment of principal of or interest on any Debt Securities of such series because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of the Debt Securities of such series to receive such payment from the money or U.S. Government Securities held by the Trustee or Paying Agent.
 
ARTICLE IX
Amendments
 
        SECTION 9.1 Without Consent of Holders . The Company and the Trustee may amend this Indenture or the Debt Securities of any series without notice to or consent of any Holder of a Debt Security of such series:
 
        (a)    to cure any ambiguity, omission, defect or inconsistency;
 
        (b)    to comply with Article IV in respect of the assumption by a successor company of the obligations of the Company under this Indenture;
 
        (c)    to add guarantees with respect to the Debt Securities of such series;
 
        (d)    to secure the Debt Securities of such series;
 
        (e)    to add to the covenants of the Company for the benefit of the Holders of the Debt Securities of such series or to surrender any right or power herein conferred upon the Company;
 
        (f)    to make any change that does not adversely affect the rights of any Holder of a Debt Security of such series;
 
        (g)     to comply with any requirement of the SEC in connection with the qualification of this Indenture under the TIA;
 
 
 
41
 
        (h)     to establish the form or terms of Debt Securities of any series as permitted by Sections 2.2 and 2.3 ; or
 
        (i)     to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Debt Securities of one or more series, and as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee.
 
        After an amendment under this Section 9.1 becomes effective, the Company shall mail to Holders of the Debt Securities of such series a notice briefly describing such amendment. The failure to give such notice to all Holders of the Debt Securities of such series at the address set forth in the Security Register, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.1 .
 
        SECTION 9.2 With Consent of Holders . The Company and the Trustee may amend this Indenture or the Debt Securities of any series without notice to any Holder of a Debt Security of such series but with the written consent of the Holders of at least a majority in principal amount of the Debt Securities of all series then outstanding affected by such amendment (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Debt Securities of such series) voting as a single class, by Act of such Holders delivered to the Company and the Trustee. However, without the consent of each Holder of a Debt Security of such series affected, an amendment may not:
 
        (a)    reduce the amount of Debt Securities of such series whose Holders must consent to an amendment;
 
        (b)    reduce the stated rate of or extend the stated time for payment of interest on any Debt Security of such series;
 
        (c)    reduce the principal of or extend the Stated Maturity of any Debt Security of such series;
 
        (d)    reduce the premium payable upon the redemption of any Debt Security of such series or change the time at which any Debt Security of such series may or shall be redeemed as described above under Article V or any similar provision, whether through an amendment to or waiver of Article V , a definition or otherwise;
 
        (e)    make any Debt Security of such series payable in money other than that stated in the Debt Security of such series;
 
        (f)    impair the right of any Holder of a Debt Security of such series to receive payment of principal of and interest on such Holder’s Debt Securities of such series on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Debt Securities of such series; or
 
        (g)    make any change to the amendment provisions that require consent of the Holders of Debt Securities of such series or the waiver provisions in Section 6.4 that require consent of the Holders of Debt Securities of such series.
 
 
 
42
 
        It shall not be necessary for the consent of the Holders of such series under this Section 9.2 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.
 
        After an amendment under this Section 9.2 becomes effective, the Company shall mail to Holders of Debt Securities of such series a notice briefly describing such amendment. The failure to give such notice to all Holders of Debt Securities of such series, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.2 .
 
        SECTION 9.3 Compliance with Trust Indenture Act . Every amendment to this Indenture or the Debt Securities of any series shall comply with the TIA as then in effect.
 
        SECTION 9.4 Notation on or Exchange of Debt Securities . If an amendment changes the terms of a Debt Security of any series, the Trustee may require the Holder of such Debt Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Debt Security regarding the changed terms and return it to the Holder of such Debt Security. Alternatively, if the Company or the Trustee so determines, the Company in exchange for such Debt Security shall execute and, upon Company Order, the Trustee shall authenticate a new Debt Security of such series that reflects the changed terms. Failure to make the appropriate notation or to issue a new Debt Security of such series shall not affect the validity of such amendment.
 
        SECTION 9.5 Trustee To Sign Amendments . The Trustee shall sign any amendment authorized pursuant to this Article IX if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Trustee may, but is not obligated to, sign any amendment authorized pursuant to this Article IX if the amendment adversely affects the rights, duties, liabilities or immunities of the Trustee. In signing such amendment the Trustee shall receive indemnity reasonably satisfactory to it and receive, and (subject to Section 7.1 and Section 7.2 ) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture and that such amendment is the legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, subject to customary exceptions, and complies with the provisions hereof (including Section 9.3 ).
 
ARTICLE X
Miscellaneous
 
        SECTION 10.1 Trust Indenture Act Controls . If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.
 
        SECTION 10.2 Notices . Any notice or communication shall be in writing and delivered in person or mailed by first-class mail addressed as follows:
 
                                              if to the Company :
                                             The Black & Decker Corporation
                                             701 East Joppa Road
                                             Towson, Maryland 21286
                                                    Attention: Treasurer
 
 
 
43
 
                                              with copies to :
                                             The Black & Decker Corporation
                                             701 East Joppa Road
                                             Towson, Maryland 21286
                                                    Attention: General Counsel
 
                                             Miles & Stockbridge, P.C.
                                             10 Light Street
                                             Baltimore, Maryland 21202
                                                    Attention: Christopher R. Johnson
 
                                              if to the Trustee :
                                             The Bank of New York
                                             101 Barclay Street, 8W
                                             New York, New York 10286
                                                    Attention: Corporate Trust Administration
 
                                              with a copy to :
                                             Emmet, Marvin & Martin, LLP
                                             120 Broadway
                                             New York, New York 10271
                                                    Attention: Elizabeth M. Clark
 
        The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
 
        Any notice or communication mailed to a registered Holder shall be mailed by first-class mail to the Holders at the Holder’s address as it appears on the Security Register and shall be sufficiently given if so mailed within the time prescribed.
 
        Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
 
        SECTION 10.3 Communication by Holders with other Holders . Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the applicable series of Debt Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA Section 312(c).
 
        SECTION 10.4 Certificate and Opinion as to Conditions Precedent . Upon any request or application by the Company to the Trustee to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee:
 
        (a)    an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and
 
 
 
44
 
        (b)    an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
 
        SECTION 10.5 Statements Required in Certificate or Opinion . Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include:
 
        (a)    a statement that the individual making such certificate or opinion has read such covenant or condition;
 
        (b)    a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
 
        (c)    a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and
 
        (d)    a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.
 
        In giving such Opinion of Counsel, counsel may rely as to factual matters on an Officers’ Certificate or on certificates of public officials.
 
        SECTION 10.6 When Debt Securities Disregarded . In determining whether the Holders of the required principal amount of Debt Securities of any series have concurred in any direction, waiver or consent, Debt Securities of such series owned by the Company or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Debt Securities of such series that a Trust Officer of the Trustee actually knows are so owned shall be so disregarded. Also, subject to the foregoing, only Debt Securities outstanding at the time shall be considered in any such determination.
 
        SECTION 10.7 Rules by Trustee, Paying Agent and Registrar . The Trustee may make reasonable rules for action by, or a meeting of, Holders. The Registrar and the Paying Agent may make reasonable rules for their functions.
 
        SECTION 10.8 Legal Holidays . A “ Legal Holiday ” is a Saturday, a Sunday or other day on which commercial banking institutions are authorized or required to be closed in New York City. If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday, the record date shall not be affected.
 
         SECTION 10.9 GOVERNING LAW; WAIVER OF JURY TRIAL . THIS INDENTURE AND THE DEBT SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.
 
 
 
45
 
        SECTION 10.10 No Recourse Against Others . An incorporator, director, officer, employee, Affiliate or stockholder of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Debt Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Debt Security, each Holder shall waive and release all such liability. The waiver and release shall be part of the consideration for the issue of the Debt Securities.
 
        SECTION 10.11 Successors . All agreements of the Company in this Indenture and the Debt Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors.
 
        SECTION 10.12 Multiple Originals . The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Indenture.
 
        SECTION 10.13 Variable Provisions . The Company initially appoints the Trustee as Paying Agent and Registrar and custodian with respect to any Global Securities.
 
        SECTION 10.14 Table of Contents; Headings . The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
 
        SECTION 10.15 Force Majeure . In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
 
        SECTION 10.16 Severability . A determination that any provision of this Indenture is unenforceable or invalid shall not affect the enforceability or validity of any other provision hereof.
 
 
 
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        IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/ Charles E. Fenton  
    Name:   Charles E. Fenton  
    Title:  Senior Vice President and General Counsel  
       
 
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/ Alexander Pabon  
    Name:  Alexander Pabon  
    Title: Assistant Vice President  
       
 
 
 

 
EXHIBIT 4.6(a)
 
 

 
 

 
 

 
 
THE BLACK & DECKER CORPORATION
 
 
AND
 
 
THE BANK OF NEW YORK,
 
 
AS TRUSTEE
 
 
5.750% Senior Notes Due 2016
 
 
FIRST SUPPLEMENTAL INDENTURE
 
 
Dated as of November 16, 2006
 








 
 
 
 

 



TABLE OF CONTENTS

     
Page
 
ARTICLE I. DEFINITIONS; INCORPORATION BY REFERENCE

 
SECTION 1.1
SECTION 1.2
SECTION 1.3
 
DEFINITIONS
INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT
RULES OF CONSTRUCTION
1
2
2
 
ARTICLE II. THE NOTES

 
SECTION 2.1
SECTION 2.2
SECTION 2.3
SECTION 2.4
SECTION 2.5
SECTION 2.6
 
DESIGNATION
PRINCIPAL AMOUNT; SERIES TREATMENT
PAYMENT OF PRINCIPAL AND INTEREST
FORM
TRANSFER RESTRICTIONS
SINKING FUND
2
2
3
3
4
5
 
ARTICLE III. OPTIONAL REDEMPTION OF THE NOTES; CHANGE OF CONTROL REPURCHASE EVENT
 
ARTICLE IV. EXECUTION OF THE NOTES
 
 
ARTICLE V. MISCELLANEOUS
 
 
SECTION 5.1
SECTION 5.2
SECTION 5.3
SECTION 5.4
SECTION 5.5
SECTION 5.6
SECTION 5.7
 
RATIFICATION
TRUSTEE
GOVERNING LAW
TABLE OF CONTENTS; HEADINGS
MULTIPLE ORIGINALS
SEVERABILITY
EFFECTIVE DATE
5
5
5
5
6
6
6
 
Exhibit A – Form of Note
 
 
 
 
 
 
 
 
 
FIRST SUPPLEMENTAL INDENTURE, dated as of November 16, 2006 (this “ Supplemental Indenture ”), between THE BLACK & DECKER CORPORATION, a Maryland corporation (the “ Company ”), and THE BANK OF NEW YORK, a New York banking corporation, as Trustee.
 
RECITALS
 
A.     The Company and the Trustee have executed an indenture, dated as of November 16, 2006 (the “ Indenture ”), to provide for, among other things, the issuance from time to time of the Company’s Debt Securities in one or more series as might be authorized under the Indenture.
 
B.     The Indenture provides that the Company and the Trustee may enter into an indenture supplemental thereto to establish the form and terms of any series of Debt Securities as provided by Sections 2.1 and 2.3 of the Indenture.
 
C.     The Company has duly authorized and desires to enter into this Supplemental Indenture to provide for the establishment of Debt Securities to be known as the 5.750% Senior Notes due 2016 (the “ Notes ”), the form, substance, terms, provisions and conditions of which shall be set forth in the Indenture and this Supplemental Indenture.
 
D.     The Company has requested that the Trustee execute and deliver this Supplemental Indenture and satisfy all requirements necessary to make (i) this Supplemental Indenture a valid instrument in accordance with its terms and (ii) the Debt Securities provided for hereby, when executed and delivered by the Company and authenticated by the Trustee, the valid obligations of the Company.
 
NOW THEREFORE, each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Notes:
 
ARTICLE I
Definitions; Incorporation by Reference
 
SECTION 1.1 Definitions .
 
“ DTC ” means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depository institution hereinafter appointed by the Company.
 
“ Global Notes ” shall have the meaning set forth in Section 2.4(b) .
 
“ Indenture ” shall have the meaning set forth in the first recital.
 
“ Initial Notes ” shall have the meaning set forth in Section 2.2(a) .
 
 
 
 
 
 
 
“ Notes ” shall have the meaning set forth in the third recital.
 
“ Supplemental Indenture ” shall have the meaning set forth in the introductory paragraph.
 
SECTION 1.2 Incorporation by Reference of Trust Indenture Act . This Supplemental Indenture is subject to the mandatory provisions of the TIA, which are incorporated by reference in and made a part of this Supplemental Indenture. All TIA terms used in this Supplemental Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.
 
SECTION 1.3 Rules of Construction .
 
(a)           Unless otherwise indicated, capitalized terms that are not defined herein shall have the meanings given to them in the Indenture.
 
(b)           Unless the context otherwise requires:
 
(i)
 
a term has the meaning assigned to it;
     
(ii)
 
an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;
     
(iii)
 
“or” is not exclusive;
     
(iv)
 
“including”means including without limitation;
     
(v)
 
words in the singular include the plural and words in the plural include the singular;
     
(vi)
 
the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with U.S. GAAP; and
     
(vii)
 
unless otherwise indicated, all references to Articles or Sections refer to Articles or Sections of this Supplemental Indenture.

 
ARTICLE II
The Notes
 
 
SECTION 2.1 Designation . The Company hereby establishes a series of Debt Securities designated the “5.750% Senior Notes due 2016” for issuance under the Indenture.
 
SECTION 2.2 Principal Amount; Series Treatment .
 
(a)           The Notes shall initially be limited to an aggregate principal amount of $300,000,000 (the “Initial Notes”). The Company may, from time to time without the consent of  the Holders of the outstanding Notes, issue additional Notes, so that such additional Notes and the outstanding Notes shall be consolidated together and form a single series of Debt Securities under the Indenture, as supplemented by this Supplemental Indenture. For all purposes of the Indenture and this Supplemental Indenture, all Notes, whether Initial Notes or additional Notes, shall constitute one series of Debt Securities and shall vote together as one series of Debt Securities.
 
 
 
 
2
 
 
 
(b)           Any additional Notes issued under Section 2.2(a) shall have the same terms in all respects as the corresponding series of Notes, except that interest will accrue on the additional Notes from the most recent date to which interest has been paid on the Notes of such series (other than the additional Notes) or if no interest has been paid on the outstanding Notes of such series from the first date that the outstanding Notes were originally issued under the Indenture, as supplemented by this Supplemental Indenture.
 
 
(c)           The Notes shall be issued only in fully registered form, without coupons, and only in minimum denominations of $1,000 and integral multiples thereof.
 
 
SECTION 2.3 Payment of Principal and Interest . The principal amount of each Note shall be due and payable on November 15, 2016.
 
 
The Notes will bear interest at the rate of 5.750% per annum from November 16, 2006 until the principal thereof becomes due and payable or to the date of redemption (if any) of the Notes, such interest to be payable semi-annually in arrears on May 15 and November 15 of each year, to the Holders of record of the Notes as of the close of business on the May 1 and November 1 preceding such interest payment dates, commencing, in the case of the Initial Notes or any additional Notes issued prior to such date, on May 15, 2007.
 
 
Any payment of principal or interest required to be made on a day that is not a Business Day need not be made on such day, but may be made on the next succeeding Business Day with the same force and effect as if made on such day and no interest shall accrue as a result of such delayed payment.
 
 
SECTION 2.4 Form .
 
 
(a)           The Notes shall contain the terms set forth in, and shall be substantially in the form of, Exhibit A . The terms and provisions contained in the form of Notes set forth in Exhibit A shall constitute, and are hereby expressly made, a part of the Indenture, as supplemented by this Supplemental Indenture.
 
 
The Notes shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by the Indenture, as supplemented by this Supplemental Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements imprinted or otherwise reproduced thereon, not inconsistent with the provisions of the Indenture, as supplemented by this Supplemental Indenture, as may be required to comply with any law, or with any rules of any securities exchange, all as may, consistently herewith, be determined by the Officers executing the Notes as evidenced by their execution of the Notes.
 
 
 
 
3
 
 
 
(b)           The Company initially appoints DTC to act as Depositary with respect to the Notes issued in the form of Global Securities.
 
So long as the Notes are eligible for book-entry settlement with DTC, or unless otherwise required by law, or otherwise contemplated herein, all of the Notes shall be represented by one or more Notes in global form registered in the name of DTC or its nominee.
 
The Notes shall be issued initially in the form of one or more permanent Global Securities in registered form, substantially in the form set forth in Exhibit A (the “ Global Notes ”), registered in the name of Cede & Co., the nominee of DTC, upon Company Order, deposited with the Trustee, as custodian for DTC or its nominee, duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, in accordance with the instructions given by the Holder thereof, as hereinafter provided.
 
The transfer and exchange of beneficial interests in any such Global Notes shall be effected through DTC in accordance with this Supplemental Indenture, the Indenture and DTC’s applicable procedures. Except as provided in the Indenture, beneficial owners of a Global Note shall not be entitled to have certificates registered in their names, will not receive or be entitled to receive physical delivery of certificates in definitive form and will not be considered Holders of such Global Note.
 
Any Global Note shall represent such of the outstanding Notes as shall be specified therein and shall provide that it shall represent the aggregate amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be increased or reduced to reflect redemptions, transfers or exchanges permitted hereby. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee in such manner and upon written instructions given by the Holder of such Notes in accordance with the Indenture and this Supplemental Indenture. Payment of principal of and interest and premium, if any, on any Global Note shall be made to the Holder of such Note.
 
SECTION 2.5 Transfer Restrictions . The following provisions shall apply only to the Global Notes:
 
(a)           Each Global Note authenticated under this Supplemental Indenture shall be registered in the name of DTC or its nominee and delivered to DTC or its nominee or to the Trustee if the Trustee is acting as custodian for DTC or its nominee with respect to such Global Note, and each such Global Note shall constitute a single Note for all purposes of the Indenture and this Supplemental Indenture.
 
(b)           Notwithstanding any other provision in this Supplemental Indenture, no Global Note may be exchanged in whole or in part for Notes registered, and no transfer of a Global Note in whole or in part may be registered, in the name of any Person other than DTC or its nominee except as provided in Section 2.4 of the Indenture. Any Note issued in exchange for a Global Note or any portion thereof shall be a Global Note; provided that any such Note so issued that is registered in the name of a Person other than DTC or its nominee shall not be a Global Note.
 
 
 
4
 
 
 
(c)           Notes issued in exchange for a Global Note or any portion thereof pursuant to clause (b) above shall be issued pursuant to Section 2.4 of the Indenture.
 
(d)           At such time as all interests in a Global Note have been redeemed, repurchased, converted, canceled or exchanged for Notes in definitive form, such Global Note shall, upon receipt thereof, be canceled by the Trustee in accordance with standing procedures and instructions existing between DTC and the Trustee. At any time prior to such cancellation, if any interest in a Global Note is redeemed, repurchased, converted, canceled or exchanged for Notes in definitive form, the principal amount of such Global Note shall, in accordance with the standing procedures and instructions existing between DTC and the Trustee, be appropriately reduced, and an endorsement shall be made on such Global Note, by the Trustee, at the direction of the Trustee, to reflect such reduction.
 
SECTION 2.6 Sinking Fund . The Notes shall not be subject to a sinking fund.
 
ARTICLE III
Optional Redemption of the Notes; Change of Control Repurchase Event
 
The Notes may be redeemed at the option of the Company on the terms and conditions set forth in the form of Note set forth in Exhibit A . In the event of a Change of Control Repurchase Event (as defined in Exhibit A ) the Company will offer to repurchase the Notes on the terms and conditions set forth in the form of Note set forth in Exhibit A .
 
 
ARTICLE IV
Execution of the Notes
 
The Notes, the Company Order and any Officers’ Certificates to be delivered under the Indenture in connection with the authentication and delivery of the Notes shall be executed and delivered as set forth in the Indenture.
 
ARTICLE V
Miscellaneous
 
SECTION 5.1 Ratification . The Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent herein and therein provided.
 
SECTION 5.2 Trustee . The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Company.
 
SECTION 5.3 Governing Law . THIS SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
 
 
 
 
5
 
 
 
 
SECTION 5.4 Table of Contents; Headings . The table of contents and headings of the Articles and Sections of this Supplemental Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
 
 
SECTION 5.5 Multiple Originals . The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Supplemental Indenture.
 
 
SECTION 5.6 Severability . A determination that any provision of this Supplemental Indenture is unenforceable or invalid shall not affect the enforceability or validity of any other provision hereof.
 
 
SECTION 5.7 Effective Date . This Supplemental Indenture shall be effective pursuant to Section 9.1 of the Indenture immediately upon execution by the Company and delivery to and execution by the Trustee of this Supplemental Indenture.
 
 
[signatures appear on the following page]
 
 

 
 
6
 
 



IN WITNESS WHEREOF, the parties have caused this Supplemental Indenture to be duly executed as of the date first written above.
 
 
  THE BLACK &DECKER CORPORATION  
       
 
By:
/s/  Charles E. Fenton  
    Name:  Charles E. Fenton   
    Title:  Senior Vice President and General Counsel   
       
 
 
  THE BANK OF NEW YORK, as Trustee  
       
 
By:
/s/  Alexander Pabon  
    Name:  Alexander Pabon   
    Title:  Assistant Vice President   
       
 
 
 
 
 
7
 
 
 
EXHIBIT A
 
 
[FORM OF FACE OF NOTE]
 
 
[Global Notes shall bear the following legend]
 
 
[THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), AS DEPOSITARY, OR A NOMINEE OF DTC. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
 
 
Unless this certificate is presented by an authorized representative of DTC, to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co., or such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is required by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.]
 

 
 
 
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No.___
 
Principal Amount $300,000,000,
as revised by the Schedule of
Increases and Decreases in
Global Security attached hereto
 
CUSIP NO. ____________
ISIN: ____________
 
 
5.750% Senior Notes Due 2016
 
The Black & Decker Corporation, a Maryland corporation, promises to pay to Cede & Co., or registered assigns, the principal sum of $300,000,000 Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on November 15, 2016.
 
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
 
Additional provisions of this Note are set forth on the other side of this Note.
 
  THE BLACK &DECKER CORPORATION  
       
 
By:
/s/   
    Name:   
    Title:   
       
 
 
TRUSTEE’S CERTIFICATE OF
AUTHENTICATION
 
The Bank of New York, as Trustee,
certifies that this is one of the Debt
Securities referred to in the Indenture.
 
 By:  
  Authorized Signatory 
  Date: 
 
 
 
 
A-2


 
[FORM OF REVERSE SIDE OF NOTE]
 
5.750% Senior Notes Due 2016
 
This Note is one of a duly authorized issue of Debt Securities of The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “ Company ”), of the series hereinafter specified, all issued or to be issued pursuant to an indenture, dated as of November 16, 2006, as amended and supplemented by the First Supplemental Indenture, dated as of November 16, 2006 (together referred to herein as the “ Indenture ”), between the Company and The Bank of New York, a New York banking corporation, as trustee (the “ Trustee ,” which term includes any successor Trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders of the Debt Securities. To the extent terms of the Indenture and this Note are inconsistent, the terms of the Indenture shall govern. This Note is one of a series of Debt Securities of the Company designated as the 5.750% Senior Notes due 2016 (the “ Notes ”), initially limited in aggregate principal amount of $300,000,000, subject to the issuance of additional Notes as provided in the Indenture. Terms used but not defined herein shall have the respective meanings set forth in the Indenture.
 
1.            Interest . The Company promises to pay interest on the principal amount of this Debt Security at the rate per annum shown above.
 
The Company will pay interest semiannually on May 15 and November 15 of each year commencing May 15, 2007. Interest on the Notes will accrue from the most recent date to which interest has been paid on the Notes or, if no interest has been paid, from November 16, 2006. The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Notes to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months.
 
2.            Method of Payment . By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Note is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due. The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Notes at the close of business on May 1 or November 1 next preceding the interest payment date even if Notes are cancelled, repurchased or redeemed after the record date and on or before the interest payment date. Holders must surrender Notes to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Notes shall be payable at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Security Register. Payments in respect of Notes represented by a Global Note (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by the Depositary. Payments in respect of Notes represented by definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Notes represented by definitive Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
 
 
 
 
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Any payment of principal or interest required to be made on a day that is not a Business Day need not be made on such day, but may be made on the next succeeding Business Day with the same force and effect as if made on such day and no interest shall accrue as a result of such delayed payment. As used in this Note, the term “ Business Day ” means a day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in the City of New York.
 
3.            Paying Agent and Registrar . Initially, the Trustee will act as Trustee, Paying Agent and Registrar. The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Holder. The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.
 
4.            Indenture . The Company issued the Notes under the Indenture. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the “Act”). Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture. The Notes are subject to all such terms, and Holders are referred to the Indenture and the Act for a statement of those terms. In the event of any inconsistency between the terms of this Note and the terms of the Indenture, the terms of the Indenture shall control.
 
 The Notes are general unsecured and unsubordinated obligations of the Company initially limited to $300,000,000 aggregate principal amount of Notes and will rank equally with all of the Company’s existing and future unsecured and unsubordinated indebtedness. The Company may at any time issue additional Notes under the Indenture in unlimited amounts having the same terms as and treated as a single class with the Notes for all purposes under the Indenture and will vote together as one class with respect to the Notes. This Note is one of the Debt Securities referred to in the Indenture. The Indenture imposes certain limitations on, among other things the incurrence of certain liens and sale-leaseback transactions by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.
 
5.            Redemption; Change of Control Repurchase Event . The Notes will be redeemable, in whole or in part, at any time, at the option of the Company, upon not less than 30 and not more than 60 days prior notice mailed by first-class mail to each Holder of Notes to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of
 
o           100% of the principal amount of the Notes to be redeemed; or
 
 
 
A-4
 
 
 
 
o           the sum of the present values of the remaining scheduled payments of principal of and interest on the Notes to be redeemed, exclusive of interest accrued to the redemption date, discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined below), plus 20 basis points, as calculated by an Independent Investment Banker;
 
plus, in either case, accrued and unpaid interest on the principal amount of the Notes to be redeemed to the redemption date.
 
For purposes of determining the optional redemption price, the following definitions are applicable:
 
“ Adjusted Treasury Rate ” means, with respect to any redemption date for the Notes,
 
o           the yield, under the heading that represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the applicable maturity date, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or
 
o           if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
The Adjusted Treasury Rate shall be calculated on the third business day preceding the redemption date.
 
“Comparable Treasury Issue” means the U.S. Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.
 
“Comparable Treasury Price” means, with respect to any redemption date applicable to the Notes (1) the average of four Reference Treasury Dealer Quotations obtained by the Trustee for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations; or (2) if the Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer Quotations obtained by the Trustee.
 
 
 
 
A-5
 
 
 
 
“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company; provided that the Trustee will not be liable for any errors and omissions of the Independent Investment Banker.
 
“Reference Treasury Dealer” means (1) Banc of America Securities LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. (or their respective successors); provided, however, that if any of the foregoing shall cease to be a primary U.S. government securities dealer in New York City (a "Primary Treasury Dealer"), the Company shall substitute therefor another Primary Treasury Dealer; and (2) one other Primary Treasury Dealer appointed by the Trustee after consultation with the Company; provided that the Trustee will not be liable for any errors and omissions of such Primary Treasury Dealer.
 
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Notes, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.
 
In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee at least 30 and not more than 60 days prior to the redemption date and by such method as the Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) the Notes and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Note not redeemed to less than $1,000. Notice of such redemption will be given within this period of time in accordance with the Indenture. If any Note is to be redeemed in part only, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed. A new Note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Note. On and after the redemption date, interest will cease to accrue on the Notes or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Notes that are to be redeemed on such date.
 
If a Change of Control Repurchase Event (defined below) occurs, unless the Company has previously exercised its right to redeem the notes as described above, the Company will make an offer to each Holder of Notes to repurchase all or any part (in integral multiples of $1,000) of that Holder’s Notes at a repurchase price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus any accrued and unpaid interest on the Notes repurchased to the date of purchase. Within 30 days following any Change of Control Repurchase Event or, at the Company’s option, prior to any Change of Control (defined below), but after the public announcement of the Change of Control, the Company will mail a notice to each Holder, with a copy to the Trustee, describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event and offering to repurchase Notes on the payment date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed. The
 
 
 
 
A-6
 
 
 
 
notice shall, if mailed prior to the date of consummation of the Change of Control, state that the offer to purchase is conditioned on the Change of Control Repurchase Event occurring on or prior to the payment date specified in the notice. The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and any other securities laws and regulations under the Exchange Act to the extent those laws and regulations are applicable in connection with the repurchase of the notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Repurchase Event provisions herein, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control Repurchase Event provisions herein by virtue of such conflict.
 
On the Change of Control Repurchase Event payment date, the Company will, to the extent lawful:
 
o           accept for payment all Notes or portions of Notes properly tendered pursuant to the Company's offer;
 
o           deposit with the Paying Agent an amount equal to the aggregate purchase price in respect of all Notes or portions of Notes properly tendered; and
 
o           deliver or cause to be delivered to the Trustee the Notes properly accepted, together with an Officers’ Certificate stating the aggregate principal amount of Notes being purchased by the Company.
 
The Paying Agent will promptly mail to each Holder of Notes properly tendered the purchase price for the Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unpurchased portion of any Notes surrendered; provided that each new Note will be in a principal amount of $1,000 or an integral multiple thereof.
 
The Company will not be required to make an offer to repurchase the Notes upon a Change of Control Repurchase Event if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and such third party purchases all Notes properly tendered and not withdrawn under its offer.
 
For purposes of the Notes:
 
“Below Investment Grade Rating Event” means the Notes are rated below Investment Grade (defined below) by both rating agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by either of the rating agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus
 
 
A-7
 
 
 
shall not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Repurchase Event) if the rating agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
 
“Change of Control” means the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) becomes the beneficial owner, directly or indirectly, of more than 50% of the Company’s Voting Stock (defined below), measured by voting power rather than number of shares. Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (1) the Company becomes a wholly owned subsidiary of a holding company and (2) the holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to that transaction.
 
“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
 
“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); and the equivalent Investment Grade credit rating from any additional Rating Agency (defined below) or Rating Agencies selected by the Company.
 
“ Moody's” means Moody's Investors Service Inc.
 
“Rating Agency” means (1) each of Moody’s and S&P; and (2) if either of Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, selected by the Company (as certified by a resolution of the Company’s board of directors) as a replacement agency for Moody’s or S&P, or both, as the case may be.
 
“S&P” means Standard & Poor’s Ratings Services, a division of McGraw-Hill, Inc.
 
“Voting Stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.
 
6.            Denominations; Transfer; Exchange . The Notes are in registered form without coupons in denominations of principal amount of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not (A) issue, register the transfer of or exchange any Note during a period beginning at the opening of 15 days before the day of any selection of Notes for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part, or (C) register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date.
 
 
 
A-8
 
 
 
7.            Persons Deemed Owners . The registered Holder of this Note will be treated as the owner of it for all purposes.
 
8.            Unclaimed Money . If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its written request unless an abandoned property law designates another Person. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee or Paying Agent for payment.
 
9.            Defeasance . Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Notes and the Indenture if the Company deposits with the Trustee money or U.S. Government Securities for the payment of principal, premium, if any, and interest on the Notes to redemption or maturity, as the case may be.
 
10.            Amendment, Waiver . Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Notes and (ii) any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Holder affected thereby) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Notes. Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, the Company and the Trustee may amend the Indenture or the Notes to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Notes, or to secure the Notes, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Holder, or to establish the form or terms of the Notes as permitted under the Indenture, or to evidence and provide for the acceptance of appointment under the Indenture by a successor Trustee with respect to the Notes and as shall be necessary to provide for or facilitate the administration of the trusts under the Indenture by more than one Trustee.
 
11.            Defaults and Remedies . Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Note when due, and continuing for 30 days; (ii) default in the payment of principal or premium, if any, on any Note when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Notes, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount
 
 
 
 
A-9
 
 
 
of the outstanding Notes; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including the Notes, but other than the Notes, if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of $50,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
If an Event of Default described in clauses (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Notes by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Notes to be due and payable. Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable. If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or the Notes unless it receives reasonable indemnity or security satisfactory to it. Subject to certain limitations, Holders of a majority in principal amount of the Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note) if it determines in good faith that withholding notice is in the interests of Holders.
 
12.            Trustee Dealings with the Company . Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.
 
13.            No Recourse Against Others . An incorporator, director, officer, employee, Affiliate or stockholder, of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Notes or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Note, each Holder waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Notes.
 
14.            Authentication . This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Note.
 
 
 
 
A-10
 
 
 
15.            Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 
16.            CUSIP Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Notes and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made by the Company or the Trustee as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
17.            Governing Law . This Note shall be governed by, and construed in accordance with, the laws of the State of New York.
 
The Company will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this Note. Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention: Treasurer
 
 
 
 
 
 
 
 
 
A-11
 
 
 

ASSIGNMENT FORM
 
To assign this Note, fill in the form below:
 
I or we assign and transfer this Note to
 
______________________________________________________
 
(Print or type assignee’s name, address and zip code)
 
______________________________________________________
 
 
(Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint _________________________ agent to transfer this Note on the books of the Company.  The agent may substitute another to act for him.

________________________________________________________________________________________________

Date:_____________________________                                                                  Your Signature:_______________________

Signature Guarantee:________________________________________________________________________________
                                                                                       (Signature must be guaranteed)

________________________________________________________________________________________________
Sign exactly as your name appears on the other side of this Note.

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
 
 
 
 
A-12
 

 





[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
(i) The following increases or decreases in this Global Security have been made:
 
 
Date of Exchange
 
Amount of decrease in Principal Amount of this Global Security
 
Amount of increase in Principal Amount of this Global Security
 
Principal Amount of this Global Security following such decrease or increase
 
Signature of authorized signatory of Trustee or Securities Custodian
                 
                 

 
 
 
 
 
 
 
 
 
 
 
A-13
Exhibit 4.6(b)






 
 
 

 


THE BLACK & DECKER CORPORATION

AND

THE BANK OF NEW YORK MELLON,
AS TRUSTEE

8.950% Senior Notes Due 2014

SECOND SUPPLEMENTAL INDENTURE

Dated as of April 3, 2009


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 


TABLE OF CONTENTS


 
Page
 
 
ARTICLE I. DEFINITIONS; INCORPORATION BY REFERENCE
 
SECTION 1.1 Definitions.
1
SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
2
SECTION 1.3Rules of Construction.
2
ARTICLE II. THE NOTES
 
SECTION 2.1 Designation.
3
SECTION 2.2 Principal Amount; Series Treatment.
3
SECTION 2.3 Payment of Principal and Interest.
3
SECTION 2.4 Form.
5
SECTION 2.5 Transfer Restrictions.
6
SECTION 2.6Sinking Fund.
7
ARTICLE III. OPTIONAL REDEMPTION OF THE NOTES; CHANGE OF CONTROL REPURCHASE EVENT
 
ARTICLE IV. EXECUTION OF THE NOTES
 
ARTICLE V. MISCELLANEOUS
 
SECTION 5.1 Ratification.
7
SECTION 5.2 Trustee.
7
SECTION 5.3 Governing Law.
7
SECTION 5.4 Table of Contents; Headings.
8
SECTION 5.5Multiple Originals.
8
SECTION 5.6Severability.
8
SECTION 5.7Effective Date.
8

Exhibit A – Form of Note
 
 
 
 
 

 
SECOND SUPPLEMENTAL INDENTURE, dated as of April 3, 2009 (this “ Supplemental Indenture ”), between THE BLACK & DECKER CORPORATION, a Maryland corporation (the “ Company ”), and THE BANK OF NEW YORK MELLON (formerly known as The Bank of New York), as trustee (the “ Trustee ”).

RECITALS

A.           The Company and the Trustee have executed an indenture, dated as of November16, 2006 (the “ Indenture ”), to provide for, among other things, the issuance from time to time of the Company’s Debt Securities in one or more series as might be authorized under the Indenture.

B.           The Indenture provides that the Company and the Trustee may enter into an indenture supplemental thereto to establish the form and terms of any series of Debt Securities as provided by Sections 2.1 and 2.3 of the Indenture.

C.           The Company and the Trustee have executed a supplemental indenture, dated as of November16, 2006 (the “ First Supplemental Indenture ”), to provide for the issuance of an aggregate principal amount of $300,000,000 of Debt Securities known as 5.750% Senior Notes due 2016.

D.           The Company has duly authorized and desires to enter into this Supplemental Indenture to provide for the establishment of Debt Securities to be known as the 8.950% Senior Notes due 2014 (the “ Notes ”), the form, substance, terms, provisions and conditions of which shall be set forth in the Indenture and this Supplemental Indenture.

E.           The Company has requested that the Trustee execute and deliver this Supplemental Indenture and satisfy all requirements necessary to make (i)this Supplemental Indenture a valid instrument in accordance with its terms and (ii) the Debt Securities provided for hereby, when executed and delivered by the Company and authenticated by the Trustee, the valid obligations of the Company.

NOW THEREFORE, each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Notes:

ARTICLE I
Definitions; Incorporation by Reference

SECTION 1.1   Definitions .

“ DTC ” means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depository institution hereinafter appointed by the Company.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ First Supplemental Indenture ” shall have the meaning set forth in the third recital.

“ Global Notes ” shall have the meaning set forth in Section 2.4(b) .
 
 
 
 
 
 
 

 
“ Indenture ” shall have the meaning set forth in the first recital.

“ Initial Notes ” shall have the meaning set forth in Section 2.2(a) .

“ Moody’s ” means Moody’s Investor Services, Inc.

“ Notes ” shall have the meaning set forth in the fourth recital.

“ Rating Agency ” means (1) each of Moody’s and S&P and (2) if either of Moody’s and S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside the control of the Company, a Substitute Rating Agency in lieu thereof.

“ S&P ” means Standard& Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

“ Substitute Rating Agency ” means a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the Company (as certified by the Board of Directors of the Company) as a replacement agency for Moody’s or S&P, or both, as the case may be.

“ Supplemental Indenture ” shall have the meaning set forth in the introductory paragraph.

SECTION 1.2   Incorporation by Reference of Trust Indenture Act . This Supplemental Indenture is subject to the mandatory provisions of the TIA, which are incorporated by reference in and made a part of this Supplemental Indenture. All TIA terms used in this Supplemental Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.

SECTION 1.3   Rules of Construction .

(a)           Unless otherwise indicated, capitalized terms that are not defined herein shall have the meanings given to them in the Indenture.

(b)           Unless the context otherwise requires:

 
(i)
a term has the meaning assigned to it;

 
(ii)
an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;

 
(iii)
“or” is not exclusive;

 
(iv)
“including” means including without limitation;

 
(v)
words in the singular include the plural and words in the plural include the singular;
 
 
 
2
 
 

 
 
(vi)
the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with U.S. GAAP; and

 
(vii)
unless otherwise indicated, all references to Articles or Sections refer to Articles or Sections of this Supplemental Indenture.

ARTICLE II
The Notes

SECTION 2.1   Designation .  The Company hereby establishes a series of Debt Securities designated the “8.950% Senior Notes due 2014” for issuance under the Indenture.

SECTION 2.2   Principal Amount; Series Treatment .

(a)           The Notes shall initially be limited to an aggregate principal amount of $350,000,000 (the “ Initial Notes ”).  The Company may, from time to time without the consent of the Holders of the outstanding Notes, issue additional Notes, so that such additional Notes and the outstanding Notes shall be consolidated together and form a single series of Debt Securities under the Indenture, as supplemented by this Supplemental Indenture.  For all purposes of the Indenture and this Supplemental Indenture, all Notes, whether Initial Notes or additional Notes, shall constitute one series of Debt Securities and shall vote together as one series of Debt Securities.

(b)           Any additional Notes issued under Section 2.2(a) shall have the same terms in all respects as the corresponding series of Notes, except that interest will accrue on the additional Notes from the most recent date to which interest has been paid on the Notes of such series (other than the additional Notes) or if no interest has been paid on the outstanding Notes of such series from the first date that the outstanding Notes were originally issued under the Indenture, as supplemented by this Supplemental Indenture.

(c)           The Notes shall be issued only in fully registered form, without coupons, and only in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.

SECTION 2.3   Payment of Principal and Interest .

(a)           The principal amount of each Note shall be due and payable on April 15, 2014.

(b)           Subject to adjustment under Section 2.3(c) , the Notes will bear interest at the rate of 8.950% per annum from April 3, 2009 until the principal thereof becomes due and payable or to the date of redemption (if any) of the Notes, such interest to be payable semi-annually in arrears on April 15 and October 15 of each year, to the Holders of record of the Notes as of the close of business on the April 1 and October 1 preceding such interest payment dates, commencing, in the case of the Initial Notes or any additional Notes issued prior to such date, on October 15, 2009.

(c)           The interest rate payable on the Notes shall be subject to adjustments from time to time if either Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof) downgrades (or subsequently upgrades) the debt rating assigned to the Notes, in the manner described below.
 
 
 
 
3
 
 

 
If the rating of the Notes from Moody’s (or any Substitute Rating Agency thereof) is decreased to a rating set forth in the immediately following table, the interest rate on the Notes shall increase from the interest rate payable on the Notes on the date of their initial issuance by the percentage set forth opposite that rating:

 
Moody’s Rating*
 
Percentage
 
Ba1
   
0.25
%
 
Ba2
   
0.50
%
 
Ba3
   
0.75
%
 
B1 or below
   
1.00
%

*             Including the equivalent ratings of any Substitute Rating Agency.

If the rating of the Notes from S&P (or any Substitute Rating Agency thereof) is decreased to a rating set forth in the immediately following table, the interest rate on the Notes shall increase from the interest rate payable on the Notes on the date of their initial issuance by the percentage set forth opposite that rating:

 
S&P Rating*
 
Percentage
 
BB+
   
0.25
%
 
BB
   
0.50
%
 
BB-
   
0.75
%
 
B+ or below
   
1.00
%

*             Including the equivalent ratings of any Substitute Rating Agency.
 
If at any time the interest rate on the Notes has been adjusted upward as a result of a decrease in a rating by either Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof), as the case may be, and subsequently such Rating Agency increases its rating of the Notes to any of the threshold ratings set forth above, the interest rate on the Notes shall be decreased such that the interest rate for the Notes equals the interest rate payable on the Notes on the date of their initial issuance plus the percentages set forth opposite the applicable ratings from the tables above in effect immediately following the increase in rating.  If Moody’s (or any Substitute Rating Agency thereof) subsequently increases its rating of the Notes to Baa3 or higher (or an equivalent rating of such Substitute Rating Agency), and S&P (or any Substitute Rating Agency thereof) increases its rating to BBB- or higher (or an equivalent rating of such Substitute Rating Agency), the interest rate on the Notes shall be decreased to the interest rate payable on the Notes on the date of their initial issuance. In addition, the interest rate on the Notes shall permanently cease to be subject to any adjustment described above (notwithstanding any subsequent decrease in the ratings by either or both Rating Agencies) if the Notes become rated A3 and A- or higher by Moody’s and S&P, respectively (or, in either case, the equivalent ratings of any Substitute Rating Agency, or one of these ratings if the Notes are only rated by one Rating Agency).

Each adjustment required by any decrease or increase in a rating set forth above, whether occasioned by the action of Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof), shall be made independent of any and all other adjustments. In no event shall (1) the interest rate payable for the Notes be reduced to below the interest rate payable on the Notes on the date of their initial issuance or (2) the total increase in the interest rate on the Notes exceed 2.00% above the interest rate payable on the Notes on the date of their initial issuance.
 
 
 
4
 
 
 

 
For so long as only one Rating Agency provides a rating on the Notes, any subsequent increase or decrease in the interest rate of the Notes necessitated by a reduction or increase in the rating by the agency continuing to provide the rating shall be twice the percentage set forth in the applicable table above. No adjustments in the interest rate of the Notes shall be made solely as a result of a Rating Agency ceasing to provide a rating. For so long as no Rating Agency provides a rating of the Notes, the interest rate on the Notes shall increase to, or remain at, as the case may be, 2.00% above the interest rate payable on the Notes on the date of their initial issuance.

Any interest rate increase or decrease described above shall take effect on the next business day after the rating change has occurred.  The Company shall be responsible for delivering an Officer’s Certificate to the Trustee on the date of any increase or decrease in the ratings of the Notes notifying the Trustee (i) of any such change in the rating of the Notes; (ii) specifying the new interest rate payable on the Notes; and (iii) setting forth the effective date of any change in the interest rate payable on the Notes.  The Trustee shall not be responsible for monitoring the ratings of the Notes to determine whether there has been any increase or decrease in such rating or for calculating the new interest rate payable on the Notes in the event of any increase or decrease in the ratings of the Notes.

If the interest rate payable on the Notes is increased as described in this Section 2.3(c) , then the term “interest”, as used in the Indenture and the Notes, shall be deemed to include any such additional interest unless the context otherwise requires.

(d)           Any payment of principal or interest required to be made on a day that is not a Business Day need not be made on such day, but may be made on the next succeeding Business Day with the same force and effect as if made on such day and no interest shall accrue as a result of such delayed payment.

SECTION 2.4   Form .

(a)           The Notes shall contain the terms set forth in, and shall be substantially in the form of, Exhibit A .  The terms and provisions contained in the form of Notes set forth in Exhibit A  shall constitute, and are hereby expressly made, a part of the Indenture, as supplemented by this Supplemental Indenture.

The Notes shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by the Indenture, as supplemented by this Supplemental Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements imprinted or otherwise reproduced thereon, not inconsistent with the provisions of the Indenture, as supplemented by this Supplemental Indenture, as may be required to comply with any law, or with any rules of any securities exchange, all as may, consistently herewith, be determined by the Officers executing the Notes as evidenced by their execution of the Notes.
 
 
 
 
5
 
 

 
(b)           The Company initially appoints DTC to act as Depositary with respect to the Notes issued in the form of Global Securities.

So long as the Notes are eligible for book-entry settlement with DTC, or unless otherwise required by law, or otherwise contemplated herein, all of the Notes shall be represented by one or more Notes in global form registered in the name of DTC or its nominee.

The Notes shall be issued initially in the form of one or more permanent Global Securities in registered form, substantially in the form set forth in  Exhibit A (the “ Global Notes ”), registered in the name of Cede & Co., the nominee of DTC, upon Company Order, deposited with the Trustee, as custodian for DTC or its nominee, duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, in accordance with the instructions given by the Holder thereof, as hereinafter provided.

The transfer and exchange of beneficial interests in any such Global Notes shall be effected through DTC in accordance with this Supplemental Indenture, the Indenture and DTC’s applicable procedures.  Except as provided in the Indenture, beneficial owners of a Global Note shall not be entitled to have certificates registered in their names, will not receive or be entitled to receive physical delivery of certificates in definitive form and will not be considered Holders of such Global Note.

Any Global Note shall represent such of the outstanding Notes as shall be specified therein and shall provide that it shall represent the aggregate amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be increased or reduced to reflect redemptions, transfers or exchanges permitted hereby.  Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee in such manner and upon written instructions given by the Holder of such Notes in accordance with the Indenture and this Supplemental Indenture.  Payment of principal of and interest and premium, if any, on any Global Note shall be made to the Holder of such Note.

SECTION 2.5   Transfer Restrictions .  The following provisions shall apply only to the Global Notes:

(a)           Each Global Note authenticated under this Supplemental Indenture shall be registered in the name of DTC or its nominee and delivered to DTC or its nominee or to the Trustee if the Trustee is acting as custodian for DTC or its nominee with respect to such Global Note, and each such Global Note shall constitute a single Note for all purposes of the Indenture and this Supplemental Indenture.

(b)           Notwithstanding any other provision in this Supplemental Indenture, no Global Note may be exchanged in whole or in part for Notes registered, and no transfer of a Global Note in whole or in part may be registered, in the name of any Person other than DTC or its nominee except as provided in Section 2.4 of the Indenture.  Any Note issued in exchange for a Global Note or any portion thereof shall be a Global Note; provided that any such Note so issued that is registered in the name of a Person other than DTC or its nominee shall not be a Global Note.
 
 
 
6
 
 

 
(c)           Notes issued in exchange for a Global Note or any portion thereof pursuant to clause (b) above shall be issued pursuant to Section 2.4 of the Indenture.

(d)           At such time as all interests in a Global Note have been redeemed, repurchased, converted, canceled or exchanged for Notes in definitive form, such Global Note shall, upon receipt thereof, be canceled by the Trustee in accordance with standing procedures and instructions existing between DTC and the Trustee.  At any time prior to such cancellation, if any interest in a Global Note is redeemed, repurchased, converted, canceled or exchanged for Notes in definitive form, the principal amount of such Global Note shall, in accordance with the standing procedures and instructions existing between DTC and the Trustee, be appropriately reduced, and an endorsement shall be made on such Global Note, by the Trustee, at the written direction of the Company, to reflect such reduction.

SECTION 2.6   Sinking Fund .  The Notes shall not be subject to a sinking fund.

ARTICLE III
Optional Redemption of the Notes; Change of Control Repurchase Event

The Notes may be redeemed at the option of the Company on the terms and conditions set forth in the form of Note set forth in Exhibit A .  In the event of a Change of Control Repurchase Event (as defined in Exhibit A ) the Company will offer to repurchase the Notes on the terms and conditions set forth in the form of Note set forth in Exhibit A .

ARTICLE IV
Execution of the Notes

The Notes, the Company Order, any Opinion of Counsel and any Officers’ Certificates to be delivered under the Indenture in connection with the authentication and delivery of the Notes shall be executed and delivered as set forth in the Indenture.

ARTICLE V
Miscellaneous

SECTION 5.1   Ratification .  The Indenture, as supplemented by the First Supplemental Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent herein and therein provided.

SECTION 5.2   Trustee .  The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Company.

SECTION 5.3   Governing Law .   THIS SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
 
 
 
 
 
7
 

 
SECTION 5.4   Table of Contents; Headings .  The table of contents and headings of the Articles and Sections of this Supplemental Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

SECTION 5.5   Multiple Originals .  The parties may sign any number of copies of this Supplemental Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.  One signed copy is enough to prove this Supplemental Indenture.

SECTION 5.6   Severability .  A determination that any provision of this Supplemental Indenture is unenforceable or invalid shall not affect the enforceability or validity of any other provision hereof.

SECTION 5.7   Effective Date .  This Supplemental Indenture shall be effective pursuant to Section 9.1 of the Indenture immediately upon execution by the Company and delivery to and execution by the Trustee of this Supplemental Indenture.

[ signatures appear on the following page ]
 
 

 
8

IN WITNESS WHEREOF, the parties have caused this Supplemental Indenture to be duly executed as of the date first written above.


 
THE BLACK & DECKER CORPORATION
 
       
       
 
By:
/s/ MARK M. ROTHLEITNER
 
 
Name:
Mark M. Rothleitner
 
 
Title:
Vice President – Investor Relations
 
   
and Treasurer
 

 
THE BANK OF NEW YORK MELLON, as Trustee
 
       
       
 
By:
/s/ CHERYL L. CLARKE
 
 
Name:
Cheryl L. Clarke
 
 
Title:
Vice President
 

 

  (signature page to Second Supplemental Indenture)
 
 
 
 
 
 

 
EXHIBIT A

[FORM OF FACE OF NOTE]

[Global Notes shall bear the following legend]

[THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), AS DEPOSITARY, OR A NOMINEE OF DTC.  TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
 
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OF PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY THE AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]


 
 
 
 
 
 
 
 
 
 
 
A-1
 
 

 

No. ___
Principal Amount $350,000,000,
 
as revised by the Schedule of
 
Increases and Decreases in
 
Global Security attached hereto
 
CUSIP NO. ____________
ISIN: ____________
8.950% Senior Notes Due 2014

The Black & Decker Corporation, a Maryland corporation, promises to pay to Cede & Co., or registered assigns, the principal sum of $350,000,000 Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on April 15, 2014.
 
Interest Payment Dates:  April 15 and October 15
Record Dates:  April 1 and October 1
 
Additional provisions of this Note are set forth on the other side of this Note.
 
 

 
THE BLACK & DECKER CORPORATION
 
       
       
 
By:
/s/
 
 
 
Name:
 
    Title:   
 


TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

The Bank of New York Mellon, as Trustee,
certifies that this is one of the Debt
Securities referred to in the Indenture.

By:
_____________________________
 
Authorized Signatory
 
Date:


 
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[FORM OF REVERSE SIDE OF NOTE]

8.950% Senior Notes Due 2014

This Note is one of a duly authorized issue of Debt Securities of The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “ Company ”), of the series hereinafter specified, all issued or to be issued pursuant to an indenture, dated as of November 16, 2006, as amended and supplemented by the Second Supplemental Indenture, dated as of April 3, 2009 (together referred to herein as the “ Indenture ”), between the Company and The Bank of New York Mellon (formerly known as The Bank of New York), a New York banking corporation, as trustee (the “ Trustee ,” which term includes any successor Trustee under the Indenture), to which the Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders of the Debt Securities. To the extent terms of the Indenture and this Note are inconsistent, the terms of the Indenture shall govern.  This Note is one of a series of Debt Securities of the Company designated as the 8.950% Senior Notes due 2014 (the “ Notes ”), initially limited in aggregate principal amount of $350,000,000, subject to the issuance of additional Notes as provided in the Indenture. Terms used but not defined herein shall have the respective meanings set forth in the Indenture.

1.            Interest .

(a)           Subject to adjustment under Section 1.3(c), the Company promises to pay interest on the principal amount of this Debt Security at the rate per annum shown above.

(b)           The Company will pay interest semiannually on April 15 and October 15 of each year commencing October 15, 2009.  Interest on the Notes will accrue from the most recent date to which interest has been paid on the Notes or, if no interest has been paid, from April 3, 2009.  The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Notes to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.

(c)           The interest rate payable on the Notes shall be subject to adjustments from time to time if either Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof) downgrades (or subsequently upgrades) the debt rating assigned to the Notes, in the manner described below.

If the rating of the Notes from Moody’s (or any Substitute Rating Agency thereof) is decreased to a rating set forth in the immediately following table, the interest rate on the Notes shall increase from the interest rate payable on the Notes on the date of their initial issuance by the percentage set forth opposite that rating:

 
Moody’s Rating*
 
Percentage
 
Ba1
   
0.25
%
 
Ba2
   
0.50
%
 
Ba3
   
0.75
%
  B1 or below         1.00  % 

*             Including the equivalent ratings of any Substitute Rating Agency.


 
 
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If the rating of the Notes from S&P (or any Substitute Rating Agency thereof) is decreased to a rating set forth in the immediately following table, the interest rate on the Notes shall increase from the interest rate payable on the Notes on the date of their initial issuance by the percentage set forth opposite that rating:

 
S&P Rating*
 
Percentage
 
BB+
   
0.25
%
 
BB
   
0.50
%
 
BB-
   
0.75
%
 
B+ or below
   
1.00
%
 

*             Including the equivalent ratings of any Substitute Rating Agency.
 
If at any time the interest rate on the Notes has been adjusted upward as a result of a decrease in a rating by either Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof), as the case may be, and subsequently such Rating Agency increases its rating of the Notes to any of the threshold ratings set forth above, the interest rate on the Notes shall be decreased such that the interest rate for the Notes equals the interest rate payable on the Notes on the date of their initial issuance plus the percentages set forth opposite the applicable ratings from the tables above in effect immediately following the increase in rating.  If Moody’s (or any Substitute Rating Agency thereof) subsequently increases its rating of the Notes to Baa3 or higher (or an equivalent rating of such Substitute Rating Agency), and S&P (or any Substitute Rating Agency thereof) increases its rating to BBB- or higher (or an equivalent rating of such Substitute Rating Agency), the interest rate on the Notes shall be decreased to the interest rate payable on the Notes on the date of their initial issuance. In addition, the interest rate on the Notes shall permanently cease to be subject to any adjustment described above (notwithstanding any subsequent decrease in the ratings by either or both Rating Agencies) if the Notes become rated A3 and A- or higher by Moody’s and S&P, respectively (or, in either case, the equivalent ratings of any Substitute Rating Agency, or one of these ratings if the Notes are only rated by one Rating Agency).

Each adjustment required by any decrease or increase in a rating set forth above, whether occasioned by the action of Moody’s or S&P (or, in either case, any Substitute Rating Agency thereof), shall be made independent of any and all other adjustments. In no event shall (1) the interest rate payable for the Notes be reduced to below the interest rate payable on the Notes on the date of their initial issuance or (2) the total increase in the interest rate on the Notes exceed 2.00% above the interest rate payable on the Notes on the date of their initial issuance.

For so long as only one Rating Agency provides a rating on the Notes, any subsequent increase or decrease in the interest rate of the Notes necessitated by a reduction or increase in the rating by the agency continuing to provide the rating shall be twice the percentage set forth in the applicable table above. No adjustments in the interest rate of the Notes shall be made solely as a result of a Rating Agency ceasing to provide a rating. For so long as no Rating Agency provides a rating of the Notes, the interest rate on the Notes shall increase to, or remain at, as the case may be, 2.00% above the interest rate payable on the Notes on the date of their initial issuance.

 
 
 
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Any interest rate increase or decrease described above shall take effect on the next business day after the rating change has occurred.  The Company shall be responsible for delivering an Officer’s Certificate to the Trustee on the date of any increase or decrease in the ratings of the Notes notifying the Trustee (i) of any such change in the rating of the Notes; (ii) specifying the new interest rate payable on the Notes; and (iii) setting forth the effective date of any change in the interest rate payable on the Notes.  The Trustee shall not be responsible for monitoring the ratings of the Notes to determine whether there has been any increase or decrease in such rating or for calculating the new interest rate payable on the Notes in the event of any increase or decrease in the ratings of the Notes.

If the interest rate payable on the Notes is increased as described in this Section 1.3(c), then the term “interest”, as used in the Indenture and the Notes, shall be deemed to include any such additional interest unless the context otherwise requires.

2.             Method of Payment .  By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Note is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Notes at the close of business on April 1 or October 1 next preceding the interest payment date even if Notes are cancelled, repurchased or redeemed after the record date and on or before the interest payment date.  Holders must surrender Notes to a Paying Agent to collect principal payments.  The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Notes shall be payable at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Security Register.  Payments in respect of Notes represented by a Global Note (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by the Depositary.  Payments in respect of Notes represented by definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Notes represented by definitive Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

Any payment of principal or interest required to be made on a day that is not a Business Day need not be made on such day, but may be made on the next succeeding Business Day with the same force and effect as if made on such day and no interest shall accrue as a result of such delayed payment.  As used in this Note, the term “ Business Day ” means a day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in the City of New York.
 
 
 
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3.            Paying Agent and Registrar .  Initially, the Trustee will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Holder.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.

4.            Indenture .  The Company issued the Notes under the Indenture.  The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the “ Act ”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Notes are subject to all such terms, and Holders are referred to the Indenture and the Act for a statement of those terms.  In the event of any inconsistency between the terms of this Note and the terms of the Indenture, the terms of the Indenture shall control.

The Notes are general unsecured and unsubordinated obligations of the Company initially limited to $350,000,000 aggregate principal amount of Notes and will rank equally with all of the Company’s existing and future unsecured and unsubordinated indebtedness.  The Company may at any time issue additional Notes under the Indenture in unlimited amounts having the same terms as and treated as a single class with the Notes for all purposes under the Indenture and will vote together as one class with respect to the Notes.  This Note is one of the Debt Securities referred to in the Indenture.  The Indenture imposes certain limitations on, among other things the incurrence of certain liens and sale-leaseback transactions by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.

5.            Redemption; Change of Control Repurchase Event .  The Notes will be redeemable, in whole or in part, at any time, at the option of the Company, upon not less than 30 and not more than 60 days prior notice mailed by first-class mail to each Holder of Notes to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of

●             100% of the principal amount of the Notes to be redeemed; or

●             the sum of the present values of the remaining scheduled payments of principal of and interest on the Notes to be redeemed, exclusive of interest accrued to the redemption date, discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined below), plus 50 basis points, as calculated by an Independent Investment Banker;
 
                              plus, in either case, accrued and unpaid interest on the principal amount of the Notes to be redeemed to the redemption date.

                              For purposes of determining the optional redemption price, the following definitions are applicable:
 
 
 
 
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                              “ Adjusted Treasury Rate ” means, with respect to any redemption date for the Notes,

●             the yield, under the heading that represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the applicable maturity date, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or

●             if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
                              The Adjusted Treasury Rate shall be calculated on the third business day preceding the redemption date.

                              “ Comparable Treasury Issue ” means the U.S. Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.
 
                              “ Comparable Treasury Price ” means, with respect to any redemption date applicable to the Notes (1) the average of four Reference Treasury Dealer Quotations obtained by the Trustee for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations; or (2) if the Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer Quotations obtained by the Trustee.
 
                              “ Independent Investment Banker ” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company; provided that the Trustee will not be liable for any errors and omissions of the Independent Investment Banker.
 
                              “ Reference Treasury Dealer ” means (1) Citigroup Global Markets Inc., Banc of America Securities LLC, and J.P. Morgan Securities Inc. (or their respective successors); provided, however , that if any of the foregoing shall cease to be a primary U.S. government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer; and (2) one other Primary Treasury Dealer appointed by the Trustee after consultation with the Company; provided that the Trustee will not be liable for any errors and omissions of such Primary Treasury Dealer.

 
 
 
 

 
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“ Reference Treasury Dealer Quotations ” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Notes, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.
 
In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee at least 30 and not more than 60 days prior to the redemption date and by such method as the Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) the Notes and portions thereof that the Trustee selects shall be in amounts of $2,000 or an integral multiple of $1,000 in excess thereof and (ii) no such partial redemption shall reduce the portion of the principal amount of a Note not redeemed to less than $2,000.  Notice of such redemption will be given within this period of time in accordance with the Indenture.  If any Note is to be redeemed in part only, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Note.  On and after the redemption date, interest will cease to accrue on the Notes or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Notes that are to be redeemed on such date.
 
If a Change of Control Repurchase Event (defined below) occurs, unless the Company has previously exercised its right to redeem the Notes as described above, the Company will make an offer to each Holder of Notes to repurchase all or any part (in amounts of $2,000 or in integral multiples of $1,000 in excess thereof) of that Holder’s Notes at a repurchase price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus any accrued and unpaid interest on the Notes repurchased to the date of purchase. Within 30 days following any Change of Control Repurchase Event or, at the Company’s option, prior to any Change of Control (defined below), but after the public announcement of the Change of Control, the Company will mail a notice to each Holder, with a copy to the Trustee, describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event and offering to repurchase Notes on the payment date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed. The notice shall, if mailed prior to the date of consummation of the Change of Control, state that the offer to purchase is conditioned on the Change of Control Repurchase Event occurring on or prior to the payment date specified in the notice. The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations under the Exchange Act to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Repurchase Event provisions herein, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control Repurchase Event provisions herein by virtue of such conflict.

 
 
 
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On the Change of Control Repurchase Event payment date, the Company will, to the extent lawful:

●
 
accept for payment all Notes or portions of Notes properly tendered pursuant to the Company’s offer;

●
 
deposit with the Paying Agent an amount equal to the aggregate purchase price in respect of all Notes or portions of Notes properly tendered; and

●
 
deliver or cause to be delivered to the Trustee the Notes properly accepted, together with an Officers’ Certificate stating the aggregate principal amount of Notes being purchased by the Company.

The Paying Agent will promptly mail to each Holder of Notes properly tendered the purchase price for the Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unpurchased portion of any Notes surrendered; provided that each new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof.

The Company will not be required to make an offer to repurchase the Notes upon a Change of Control Repurchase Event if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and such third party purchases all Notes properly tendered and not withdrawn under its offer.

For purposes of the Notes:
 
“ Below Investment Grade Rating Event ” means the Notes are rated below Investment Grade (defined below) by both Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by either of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Repurchase Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).

“ Change of Control ” means the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) becomes the beneficial owner, directly or indirectly, of more than 50% of the Company’s Voting Stock (defined below), measured by voting power rather than number of shares.  Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (1) the Company becomes a wholly owned subsidiary of a holding company and (2) the holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to that transaction.

 
 
 
A-9
 
 

 

“ Change of Control Repurchase Event ” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

“ Investment Grade ” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody's); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); and the equivalent Investment Grade credit rating from any additional Rating Agency or Rating Agencies selected by the Company.

“ Voting Stock ” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.
 
6.              Denominations; Transfer; Exchange .  The Notes are in registered form without coupons in denominations of principal amount of $2,000 and whole multiples of $1,000 in excess thereof.  A Holder may transfer or exchange Notes in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not (A) issue, register the transfer of or exchange any Note during a period beginning at the opening of 15 days before the day of any selection of Notes for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part, or (C) register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date.
 
7.              Persons Deemed Owners .  The registered Holder of this Note will be treated as the owner of it for all purposes.
 
8.               Unclaimed Money .  If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its written request unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee or Paying Agent for payment.
 
9.               Defeasance .  Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Notes and the Indenture if the Company deposits with the Trustee money or U.S. Government Securities for the payment of principal, premium, if any, and interest on the Notes to redemption or maturity, as the case may be.

10.            Amendment, Waiver .  Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Notes and (ii) any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Holder affected thereby) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Notes.  Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, the Company and the Trustee may amend the Indenture or the Notes to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Notes, or to secure the Notes, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Holder, or to establish the form or terms of the Notes as permitted under the Indenture, or to evidence and provide for the acceptance of appointment under the Indenture by a successor Trustee with respect to the Notes and as shall be necessary to provide for or facilitate the administration of the trusts under the Indenture by more than one Trustee.
 
 
 
 
 
 
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11.             Defaults and Remedies .  Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Note when due, and continuing for 30 days; (ii) default in the payment of principal or premium, if any, on any Note when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Notes, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the outstanding Notes; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including the Notes, but other than the Notes, if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of $50,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
If an Event of Default described in clauses (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Notes by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Notes to be due and payable.  Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.

Holders may not enforce the Indenture or the Notes except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Notes unless it receives reasonable indemnity or security satisfactory to it.  Subject to certain limitations, Holders of a majority in principal amount of the Notes may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note) if it determines in good faith that withholding notice is in the interests of Holders.
 
 
 
 
 
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12.            Trustee Dealings with the Company .  Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Company or its affiliates and may otherwise deal with the Company or its affiliates with the same rights it would have if it were not Trustee.
 
13.           No Recourse Against Others .  An incorporator, director, officer, employee, affiliate or stockholder, of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Notes or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Note, each Holder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Notes.
 
14.          Authentication .  This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Note.
 
15.           Abbreviations .  Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 
16.          CUSIP Numbers .  Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Notes and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders.  No representation is made by the Company or the Trustee as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
17.          Governing Law .  This Note shall be governed by, and construed in accordance with, the laws of the State of New York.
 
The Company will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this Note.  Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland  21286
Attention:  Treasurer

 
 
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ASSIGNMENT FORM
 
To assign this Note, fill in the form below:
 
I or we assign and transfer this Note to
 
______________________________________________________
 
(Print or type assignee’s name, address and zip code)
 
______________________________________________________
 
 
(Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint _________________________ agent to transfer this Note on the books of the Company.  The agent may substitute another to act for him.

________________________________________________________________________________________________

Date:_____________________________                                                                  Your Signature:_______________________

Signature Guarantee:________________________________________________________________________________
(Signature must be guaranteed)

________________________________________________________________________________________________
Sign exactly as your name appears on the other side of this Note.

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
 
 
 
 
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
(i) The following increases or decreases in this Global Security have been made:
 
 
Date of Exchange
 
Amount of decrease in Principal Amount of this Global Security
 
Amount of increase in Principal Amount of this Global Security
 
Principal Amount of this Global Security following such decrease or increase
 
Signature of authorized signatory of Trustee or Securities Custodian
                 
                 

 
 
 
 
 
 
 
 
 
 
 
A-14
Exhibit 4.7

 
 
 
 
THE BLACK & DECKER CORPORATION
 
AND
 
THE BANK OF NEW YORK,
 
AS TRUSTEE
 
4 3/4% Senior Notes Due 2014
 
INDENTURE
 
Dated as of October 18, 2004
 
 
 
 
 
 

TABLE OF CONTENTS
 
Page
 
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE
 
SECTION 1.1
Definitions
1
SECTION 1.2
Other Definitions
5
SECTION 1.3
Incorporation by Reference of Trust Indenture Act
6
SECTION 1.4
Rules of Construction
6
     
ARTICLE II THE SECURITIES
     
SECTION 2.1
Form, Dating and Terms
7
SECTION 2.2
Execution and Authentication
13
SECTION 2.3
Registrar and Paying Agent
14
SECTION 2.4
Paying Agent To Hold Money in Trust
15
SECTION 2.5
Securityholder Lists
15
SECTION 2.6
Transfer and Exchange
15
SECTION 2.7
Form of Certificate to be Delivered in Connection with Transfers to Institutional Accredited Investors
18
SECTION 2.8
Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S
20
SECTION 2.9
Mutilated, Destroyed, Lost or Stolen Securities
21
SECTION 2.10
Outstanding Securities
22
SECTION 2.11
Temporary Securities
22
SECTION 2.12
Cancellation
23
SECTION 2.13
Payment of Interest; Defaulted Interest
23
SECTION 2.14
Computation of Interest
24
SECTION 2.15
CUSIP and ISIN Numbers
24
     
ARTICLE III COVENANTS
     
SECTION 3.1
Payment of Securities
24
SECTION 3.2
Limitation on Liens
25
SECTION 3.3
Limitation on Sale Leaseback Transactions
26
SECTION 3.4
Maintenance of Office or Agency
26
SECTION 3.5
Compliance Certificate
26
SECTION 3.6
Statement by Officers as to Default
27
SECTION 3.7
Further Instruments and Acts
27
     
ARTICLE IV SUCCESSOR COMPANY
     
SECTION 4.1
Merger, Consolidation or Sale of All or Substantially All Assets of the Company
27
     
ARTICLE V REDEMPTION OF SECURITIES
     
SECTION 5.1
Optional Redemption
27
SECTION 5.2
Applicability of Article
28
SECTION 5.3
Election to Redeem; Notice to Trustee
28
SECTION 5.4
Selection by Trustee of Securities to Be Redeemed
28
 
 
 
 
SECTION 5.5
Notice of Redemption  28
SECTION 5.6
Deposit of Redemption Price  29
SECTION 5.7 Securities Payable on Redemption Date  29
SECTION 5.8 Securities Redeemed in Part  30
 
ARTICLE VI DEFAULTS AND REMEDIES
SECTION 6.1
Events of Default
30
SECTION 6.2
Acceleration
31
SECTION 6.3
Other Remedies
32
SECTION 6.4
Waiver of Past Defaults
32
SECTION 6.5
Control by Majority
32
SECTION 6.6
Limitation on Suits
32
SECTION 6.7
Rights of Holders to Receive Payment
33
SECTION 6.8
Collection Suit by Trustee
33
SECTION 6.9
Trustee May File Proofs of Claim
33
SECTION 6.10
Priorities
33
SECTION 6.11
Undertaking for Costs
34
     
ARTICLE VII TRUSTEE
     
SECTION 7.1
Duties of Trustee
34
SECTION 7.2
Rights of Trustee
36
SECTION 7.3
Individual Rights of Trustee
37
SECTION 7.4
Trustee’s Disclaimer
37
SECTION 7.5
Notice of Defaults
37
SECTION 7.6
Reports by Trustee to Holders
37
SECTION 7.7
Compensation and Indemnity
37
SECTION 7.8
Replacement of Trustee
38
SECTION 7.9
Successor Trustee by Merger
39
SECTION 7.10
Eligibility; Disqualification
39
SECTION 7.11
Preferential Collection of Claims Against Company
40
     
ARTICLE VIII SATISFACTION AND DISCHARGE OF INDENTURE
     
SECTION 8.1
Option to Effect Legal Defeasance or Covenant Defeasance
40
SECTION 8.2
Legal Defeasance and Discharge
40
SECTION 8.3
Covenant Defeasance
40
SECTION 8.4
Conditions to Legal or Covenant Defeasance
41
SECTION 8.5
Satisfaction and Discharge of Indenture
42
SECTION 8.6
Survival of Certain Obligations
43
SECTION 8.7
Acknowledgement of Discharge by Trustee
43
SECTION 8.8
Application of Trust Moneys
43
SECTION 8.9
Repayment to the Company; Unclaimed Money
43
SECTION 8.10
Reinstatement
44
     
ARTICLE IX AMENDMENTS
     
SECTION 9.1
Without Consent of Holders
44
SECTION 9.2
With Consent of Holders
44
SECTION 9.3
Compliance with Trust Indenture Act
45
 
 
 
 
 
SECTION 9.4 Revocation and Effect of Consents and Waivers  45
SECTION 9.5 Notation on or Exchange of Securities  46
SECTION 9.6 Trustee To Sign Amendments  46
 
ARTICLE X MISCELLANEOUS
SECTION 10.2
Notices
46
SECTION 10.3
Communication by Holders with other Holders
47
SECTION 10.4
Certificate and Opinion as to Conditions Precedent
47
SECTION 10.5
Statements Required in Certificate or Opinion
48
SECTION 10.6
When Securities Disregarded
48
SECTION 10.7
Rules by Trustee, Paying Agent and Registrar
48
SECTION 10.8
Legal Holidays
48
SECTION 10.9
Governing Law; Waiver of Jury Trial
49
SECTION 10.10
No Recourse Against Others
49
SECTION 10.11
Successors
49
SECTION 10.12
Multiple Originals
49
SECTION 10.13
Variable Provisions
49
SECTION 10.14
Table of Contents; Headings
49
SECTION 10.15
Force Majeure
49
     
     
EXHIBIT A
Form of the Initial Security and Additional Security
 
EXHIBIT B
Form of the Exchange Security
 

 
 

 
CROSS-REFERENCE TABLE
 
TIA Section
  Indenture Section
310
(a)(1)
 
7.10
 
(a)(2)
 
7.10
 
(a)(3)
 
N.A.
 
(a)(4)
 
N.A.
 
(b)
 
7.8; 7.10
 
(c)
 
N.A.
311
(a)
 
7.11
 
(b)
 
7.11
 
(c)
 
N.A.
312
(a)
 
2.5
 
(b)
 
10.3
 
(c)
 
10.3
313
(a)
 
7.6
 
(b)(1)
 
N.A.
 
(b)(2)
 
7.6
 
(c)
 
7.6
 
(d)
 
7.6
314
(a)
 
3.5; 10.2; 10.5
 
(b)
 
N.A.
 
(c)(1)
 
10.4
 
(c)(2)
 
10.4
 
(c)(3)
 
N.A.
 
(d)
 
N.A.
 
(e)
 
10.5
315
(a)
 
7.1
 
(b)
 
7.5; 10.2
 
(c)
 
7.1
 
(d)
 
7.1
 
(e)
 
6.11
316
(a)(last sentence)
 
10.6
 
(a)(1)(A)
 
6.5
 
(a)(1)(B)
 
6.4
 
(a)(2)
 
N.A.
 
(b)
 
6.7
317
(a)(1)
 
6.8
 
(a)(2)
 
6.9
 
(b)
 
2.4
318
(a)
 
10.1

N.A. means Not Applicable.
 
Note:  This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.
 
 
 

INDENTURE, dated as of October 18, 2004, between THE BLACK & DECKER CORPORATION, a Maryland corporation, and THE BANK OF NEW YORK, a New York banking corporation, as Trustee.
 
Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of (i) the Company’s 4 3/4% Senior Notes Due 2014 issued on the date hereof (the “Initial Securities”), (ii) if and when issued, additional 4 3/4% Senior Notes Due 2014 that may be offered from time to time subsequent to the Issue Date (the  “Additional Securities”), and (iii) if and when issued pursuant to a Registered Exchange Offer from time to time for Initial Securities or any Additional Securities as provided in an Exchange and Registration Rights Agreement, the Company’s 4 3/4% Senior Notes Due 2014 (the “Exchange Securities”).
 
ARTICLE I
 
Definitions and Incorporation by Reference
 
SECTION 1.1      Definitions.
 
“Additional Securities” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“Attributable Debt” for a lease means the carrying value of the capitalized rental obligation determined under generally accepted accounting principles whether or not such obligation is required to be shown on the balance sheet as a long-term liability.  The carrying value may be reduced by the capitalized value of the rental obligations, calculated on the same basis, that any sublessee has for all or part of the same property.
 
“Board of Directors” means, as to any Person, the board of directors of such Person or any duly authorized committee thereof.
 
“Board Resolution” means, with respect to any Person, a resolution of the Board of Directors or of a committee or person to which or to whom the Board of Directors has properly delegated the appropriate authority, a copy of which has been certified by the Secretary or an Assistant Secretary of the Person to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivered to the Trustee.
 
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in New York City.
 
“Company” means The Black & Decker Corporation or its successor.
 
“Consolidated Net Tangible Assets” means total assets less (1) total current liabilities (excluding any Debt which, at the option of the borrower, is renewable or extendible to a term exceeding 12 months and which is included in current liabilities and further excluding any deferred income taxes which are included in current liabilities) and (2) goodwill, patents, trademarks and other like intangibles, all as stated on the Company’s most recent quarter-end consolidated balance sheet preceding the date of determination.
 
 
 
 
“Debt” means any debt for borrowed money  (including the Securities), capitalized lease obligations and purchase money obligations, or any guarantee of such debt, in any such case that would appear on the consolidated balance sheet of the Company as a liability.
 
“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.
 
“Definitive Securities” means certificated Securities.
 
“DTC” means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depository institution hereinafter appointed by the Company.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Exchange and Registration Rights Agreement” means (i) the Exchange and Registration Rights Agreement dated the Issue Date among the initial purchasers named therein and the Company, as the same may be amended, supplemented or modified from time to time and (ii) any similar exchange and/or registration rights agreement entered into with respect to any Additional Securities, as any such agreement may be amended, supplemented or modified from time to time.
 
“Exchange Securities” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“Exempted Debt” means the sum, without duplication, of the following items outstanding as of the date Exempted Date is being determined:  (i) Debt incurred after the date of the Indenture and secured by liens created or assumed or permitted to exist pursuant to paragraph  (b) of Section 3.2 and  (ii) Attributable Debt of the Company and its Subsidiaries in respect of all sale and lease-back transactions with regard to any Principal Property entered into pursuant to paragraph (b) of Section 3.3.
 
“Fiscal Year” means the fiscal year of the Company.
 
“Funded Debt” means all Debt having a maturity of more than one year from the date of its creation or having a maturity of less than one year but by its terms being renewable or extendible, at the option of the obligor in respect thereof, beyond one year from its creation.
 
“Holder” or  “Securityholder” means the Person in whose name a Security is registered in the Note Register.
 
 
2
 
 
“Indenture” means this Indenture, as amended or supplemented from time to time.
 
“Initial Securities” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“Issue Date” means the date on which the Initial Securities are originally issued.
 
“Legal Holiday” has the meaning ascribed to it in Section 10.8.
 
“Non-U.S.  Person” means a person who is not a U.S.  person, as defined in Regulation S.
 
“Note Register” has the meaning ascribed to it in Section 2.3.
 
“Officer” means the Chairman of the Board, any Vice Chairman of the Board, the President, the Chief Financial Officer, any Senior Vice President, any Vice President, the Treasurer or the Secretary of the Company.
 
“Officers’ Certificate” means a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company and delivered to the Trustee.  An Officers’ Certificate given pursuant to Section 3.5 shall be signed by any of the principal executive officer, the principal financial officer or the principal accounting officer of the Company and any other Officer.
 
“Opinion of Counsel” means a written opinion  (subject to customary assumptions, qualifications and exceptions) from legal counsel that is reasonably acceptable to the Trustee.  Unless otherwise required by the TIA, the counsel may be an employee of or counsel to the Company.
 
“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company, government or any agency or political subdivision thereof or any other entity.
 
“principal” of any Debt (including the Securities) means the principal amount of such Debt plus the premium, if any, on such Debt.
 
“Principal Property” means land, land improvements, buildings and associated factory and laboratory equipment owned or leased pursuant to a capital lease and used by the Company or any Subsidiary primarily for manufacturing, assembling, processing, producing, packaging or storing its products, raw materials, inventories or other materials and supplies located in the United States and having an acquisition cost plus capitalized improvements in excess of 2%  of Consolidated Net Tangible Assets as of the date of determination, but shall not include any such property financed through the issuance of tax exempt governmental obligations, or any such property that has been determined by Board Resolution of the Company not to be of material importance to the respective businesses conducted by the Company and its Subsidiaries taken as a whole, effective as of the date such resolution is adopted.
 
 
3
 
 
“QIB” means any “qualified institutional buyer” (as defined in Rule 144A).
 
“Redemption Date” means, with respect to any redemption of Securities, the date of redemption with respect thereto.
 
“Registered Exchange Offer” means the offer which may be made by the Company pursuant to an Exchange and Registration Rights Agreement to exchange Initial Securities or Additional Securities for Exchange Securities.
 
“Regulation S” means Regulation S under the Securities Act.
 
“Restricted Period” means the 40 consecutive days beginning on and including the later of (1) the day on which the Initial Securities are offered to Persons other than distributors  (as defined in Regulation S under the Securities Act) and (2) the Issue Date.
 
“Restricted Securities Legend” means the Private Placement Legend set forth in clause (i) of Section 2.1(c) or the Regulation S Legend set forth in clause (ii) of Section 2.1(c), as applicable.
 
“Rule 144A” means Rule 144A under the Securities Act.
 
“SEC” means the Securities and Exchange Commission.
 
“Securities” means the collective reference to the Initial Securities, Additional Securities, and Exchange Securities.
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Securities Custodian” means the custodian with respect to the Global Security (as appointed by DTC), or any successor Person thereto and shall initially be the Trustee.
 
“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but shall not include any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.
 
“Subsidiary” means any corporation, limited liability company or other business entity of which more than 50% of the total voting power of the equity interests entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof or any partnership of which more than 50% of the partners’ equity interests (considering all partners’ equity interests as a single class) is, in each case, at the time owned or controlled, directly or indirectly, by the Company, one or more of the Subsidiaries of the Company, or combination thereof.
 
“TIA” or “Trust Indenture Act” means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.  77aaa-77bbbb), as in effect on the date of this Indenture except as provided in Section 9.3.
 
 
4
 
 
“Trustee” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.
 
“Trust Officer” shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such Person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.
 
“U.S. GAAP” means generally accepted accounting principles in the United States as have been approved by a significant segment of the United States accounting profession, which are in effect at the time of each application for purposes of determining compliance with Article III and Article IV. For the purposes of this Indenture, the term “consolidated” with respect to any Person shall mean such Person consolidated with its Subsidiaries.
 
“U.S. Government Securities” means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S.  Government Securities or a specific payment of principal of or interest on any such U.S.  Government Securities held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S.  Government Securities or the specific payment of principal of or interest on the U.S. Government Securities evidenced by such depository receipt.
 
SECTION 1.2            Other Definitions.
 
Term
 
Defined in Section
“Agent Members”
 
2.1(d)
“Authenticating Agent”
 
2.2
“Bankruptcy Law”
 
6.1
“Company Order”
 
2.2
“Corporate Trust Office”
 
3.4
“Covenant Defeasance”
 
8.3
“Custodian”
 
6.1
“Defaulted Interest”
 
2.13
“Event of Default”
 
6.1
“Exchange Global Note”
 
2.1(a)
 
 
 
5
 
 
 
“Global Securities”
 
2.1(a)
“IAI”
 
2.1(a)
“Institutional Accredited Investor Global Note”
 
2.1(a)
“Legal Defeasance”
 
8.2
“Note Register”
 
2.3
“Notice of Default”
 
6.1
“Paying Agent”
 
2.3
“Private Placement Legend”
 
2.1(c)
“Registrar”
 
2.3
“Regulation S Global Note”
 
2.1(a)
“Regulation S Legend”
 
2.1(c)
“Resale Restriction Termination Date”
 
2.6
“Rule 144A Global Note”
 
2.1(a)
“Special Interest Payment Date”
 
2.13
“Special Record Date”
 
2.13
“Successor Company”
 
4.1

SECTION 1.3      Incorporation by Reference of Trust Indenture Act.
 
This Indenture is subject to the mandatory provisions of the TIA which are incorporated by reference in and made a part of this Indenture.  The following TIA terms have the following meanings:
 
“Commission” means the SEC.
 
“indenture securities” means the Securities.
 
“indenture security holder” means a Securityholder.
 
“indenture to be qualified” means this Indenture.
 
“indenture trustee” or “institutional trustee” means the Trustee.
 
“obligor” on the indenture securities means the Company and any other obligor on the indenture securities.
 
All other TIA terms used in this Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.
 
SECTION 1.4      Rules of Construction.
 
Unless the context otherwise requires:
 
(a) a term has the meaning assigned to it;
 
 
 
6
 
 
 
(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;
 
(c) “or” is not exclusive;
 
(d) “including” means including without limitation;
 
(e) words in the singular include the plural and words in the plural include the singular; and
 
(f) the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with U.S. GAAP.
 
ARTICLE II
 
The Securities
 
SECTION 2.1      Form, Dating and Terms.
 
(a)  The Initial Securities and the Additional Securities shall be in substantially the form set forth in Exhibit A hereto, which is hereby incorporated by reference and made a part of this Indenture, and the Exchange Securities shall be in substantially the form set forth in Exhibit B hereto, which is hereby incorporated by reference and made a part of this Indenture.
 
Initial Securities and Additional Securities offered, sold, and resold to QIBs in the United States of America in reliance on Rule 144A will be issued initially in the form of a permanent global Security, including appropriate legends as set forth in Section 2.1(c) below (each, a “Rule 144A Global Note”), deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  A Rule 144A Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.  The aggregate principal amount of a Rule 144A Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 
Initial Securities and Additional Securities offered, sold and resold outside the United States of America to Non-U.S.  Persons in reliance on Regulation S will be issued initially in the form of a permanent global Security, including appropriate legends as set forth in Section 2.1(c) below (each, a “Regulation S Global Note”), deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  A Regulation S Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.  The aggregate principal amount of a Regulation S Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 
 
 
7
 
 
 
Initial Securities or Additional Securities resold after an initial resale thereof to QIBs in reliance on Rule 144A or an initial resale thereof in reliance on Regulation S to institutional “accredited investors” (as defined in Rules 501(a)(1), (2), (3) or (7) under the Securities Act) who are not QIBs (each, an “IAI”) in the United States of America in accordance with the procedure described herein will be initially issued in the form of a permanent global Security (each, an “Institutional Accredited Investor Global Note”) deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  An Institutional Accredited Investor Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.  The aggregate principal amount of an Institutional Accredited Investor Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 
Exchange Securities exchanged for interests in a Rule 144A Global Note, a Regulation S Global Note or an Institutional Accredited Investor Note will be issued initially in the form of a permanent global Security, deposited with the Trustee as hereinafter provided, including the appropriate legend set forth in Section 2.1(c) below (each, an “Exchange Global Note”).  An Exchange Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.
 
The Rule 144A Global Notes, the Regulation S Global Notes, the Institutional Investor Global Notes and the Exchange Global Notes are sometimes collectively herein referred to as the “Global Securities.”
 
Except as described in the succeeding two sentences, the principal of and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Securities represented by a Global Security (including principal and interest) will be made by wire transfer of immediately available funds to the accounts specified by DTC. Payments in respect of Securities represented by Definitive Securities (including principal and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S.  dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
 
 
8
 
 
The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage, in addition to those set forth in Section 2.1(c) below.  The Company and the Trustee shall approve the forms of the Securities and any notation, endorsement or legend on them.  Each Security shall be dated the date of its authentication.  The terms of the Securities set forth in Exhibit A and Exhibit B are part of the terms of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to be bound by such terms.
 
(b)  Denominations.  The Securities shall be issuable only in fully registered form, without coupons, and only in denominations of $1,000 and any integral multiple thereof.
 
(c)  Restrictive Legends.  The following legends shall appear on the face of all Global Securities and Definitive Securities issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture:
 
(i)  Each Rule 144A Global Note and Institutional Accredited Investor Global Note shall bear the following legend (the “Private Placement Legend”) on the face thereof:
 
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION.  NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
 
 
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THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES, ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRANSFEROR FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS RELATING TO THE PROPOSED TRANSFER BEING EFFECTED PURSUANT TO AND IN ACCORDANCE WITH REGULATION S (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), (E) INSIDE THE UNITED STATES, TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a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’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”
 
 
 
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(ii)  Each Regulation S Global Note shall bear the following legend (the “Regulation S Legend”) on the face thereof:
 
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS NOT A U.S.  PERSON NOR IS IT PURCHASING FOR THE ACCOUNT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (“REGULATION S”), AND (2) BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE  (THE  “RESALE RESTRICTION TERMINATION DATE”) THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A  “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S, PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRANSFEROR FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS RELATING TO THE PROPOSED TRANSFER BEING EFFECTED PURSUANT TO AND IN ACCORDANCE WITH REGULATION S (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), (E) INSIDE THE UNITED STATES, TO AN INSTITUTIONAL  “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a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  (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES  (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED AFTER 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A) THE DAY ON WHICH THE SECURITIES ARE OFFERED TO PERSONS OTHER THAN DISTRIBUTORS  (AS DEFINED IN REGULATION S) AND (B) THE DATE OF THE CLOSING OF THE ORIGINAL OFFERING.  AS USED HEREIN, THE TERMS  “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S.  PERSON” HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.”
 
 
 
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(iii)  The Global Securities shall bear the following legend on the face thereof:
 
“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.  OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.  OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
 
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.”
 
(d)  Book-Entry Provisions.
 
(i)  This Section 2.1(d) shall apply only to Global Securities deposited with the Trustee, as custodian for DTC.
 
(ii)  Each Global Security initially shall (A) be registered in the name of DTC or the nominee of DTC, (B) be delivered to the Trustee as custodian for DTC and (C) bear legends as set forth in Section 2.1(c).
 
(iii)  Members of, or participants in, DTC (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by DTC or by the Trustee as the custodian of DTC or under such Global Security, and DTC may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as between DTC and its Agent Members, the operation of customary practices of DTC governing the exercise of the rights of a Holder of a beneficial interest in any Global Security.
 
 
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(iv)  In connection with any transfer of a portion of the beneficial interest in a Global Security pursuant to paragraph (e) of this Section 2.1 to beneficial owners who are required to hold Definitive Securities, the Securities Custodian shall reflect on its books and records the date and a decrease in the principal amount of such Global Security in an amount equal to the principal amount of the beneficial interest in the Global Security to be transferred, and the Company shall execute, and the Trustee shall authenticate and deliver, one or more Definitive Securities of like tenor and amount.
 
(v)  In connection with the transfer of an entire Global Security to beneficial owners pursuant to paragraph (e) of this Section 2.1, such Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by DTC in exchange for its beneficial interest in such Global Security, an equal aggregate principal amount of Definitive Securities of authorized denominations.
 
(vi)  The registered Holder of a Global Security may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.
 
(e)  Definitive Securities.
 
(i)  Except as provided below, owners of beneficial interests in Global Securities will not be entitled to receive Definitive Securities.  If required to do so pursuant to any applicable law or regulation, beneficial owners may obtain Definitive Securities in exchange for their beneficial interests in a Global Security upon written request in accordance with DTC’s and the Registrar’s procedures.  In addition, Definitive Securities shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Security if (A) DTC notifies the Company that it is unwilling or unable to continue as depositary for such Global Security or DTC ceases to be a clearing agency registered under the Exchange Act, at a time when DTC is required to be so registered in order to act as depositary, and in each case a successor depositary is not appointed by the Company within 90 days of such notice, (B) the Company executes and delivers to the Trustee and Registrar an Officers’ Certificate stating that such Global Security shall be so exchangeable or (C) an Event of Default has occurred and is continuing and the Registrar has received a request from DTC.
 
(ii)  Any Definitive Security delivered in exchange for an interest in a Global Security pursuant to Section 2.1(c)(iv) or (v) shall, except as otherwise provided by Section 2.6(c), bear the applicable legend regarding transfer restrictions applicable to the Definitive Security set forth in Section 2.1(c).
 
 
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(iii)  In connection with the exchange of a portion of a Definitive Security for a beneficial interest in a Global Security, the Trustee shall cancel such Definitive Security, and the Company shall execute, and the Trustee shall authenticate and deliver, to the transferring Holder a new Definitive Security representing the principal amount not so transferred.
 
SECTION 2.2      Execution and Authentication.  One Officer shall sign the Securities for the Company by manual or facsimile signature.  If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.
 
A Security shall not be valid until an authorized signatory of the Trustee manually authenticates the Security.  The signature of the Trustee on a Security shall be conclusive evidence that such Security has been duly and validly authenticated and issued under this Indenture.  A Security shall be dated the date of its authentication.
 
At any time and from time to time after the execution and delivery of this Indenture, the Trustee shall authenticate and make available for delivery:  (1) Initial Securities for original issue on the Issue Date initially in an aggregate principal amount of $300,000,000, (2) if and when issued, the Additional Securities and (3) Exchange Securities for issue pursuant to an Exchange and Registration Rights Agreement in exchange for Initial Securities or Additional Securities of an equal principal amount, in each case upon a written order of the Company signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company (the “Company Order”).  Such Company Order shall specify the amount of the Securities to be authenticated and the date on which the original issue of such Securities is to be authenticated and whether the Securities are to be Initial Securities, Additional Securities or Exchange Securities.  The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is limited to $300,000,000 principal amount of Initial Securities and such additional principal amount of Additional Securities as may be authorized from time to time by resolution adopted by the Company’s Board of Directors, except for Securities authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Securities pursuant to Section 2.6, Section 2.9, Section 2.11, Section 5.8, Section 9.5 and except for Exchange Securities.  All Securities issued on the Issue Date and all Additional Securities shall be identical in all respects other than issue dates, the date from which interest accrues and any changes relating thereto.  Notwithstanding anything to the contrary contained in this Indenture, the Holders of all Securities issued under this Indenture shall vote and consent together on all matters as one class, and the Holders of any Initial Securities, Additional Securities or Exchange Securities will not have the right to vote or consent as a separate class on any matter.
 
The Trustee may appoint an agent (the “Authenticating Agent”) reasonably acceptable to the Company to authenticate the Securities.  Unless limited by the terms of such appointment, any such Authenticating Agent may authenticate Securities whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent.  An Authenticating Agent has the same rights as a Paying Agent to deal with Holders or an Affiliate of the Company.
 
 
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In case the Company, pursuant to Article IV, shall be consolidated or merged with or into any other Person or shall convey, transfer, lease or otherwise dispose of its properties and assets substantially as an entirety to any Person, and the successor Person resulting from such consolidation, or surviving such merger, or into which the Company shall have been merged, or the Person which shall have received a conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenture supplemental hereto with the Trustee pursuant to Article IV, any of the Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer, lease or other disposition may, from time to time, at the request of the successor Person, be exchanged for other Securities executed in the name of the successor Person with such changes in phraseology and form as may be appropriate, but otherwise in substance of like tenor as the Securities surrendered for such exchange and of like principal amount; and the Trustee, upon Company Order of the successor Person, shall authenticate and deliver Securities as specified in such order for the purpose of such exchange.  If Securities shall at any time be authenticated and delivered in any new name of a successor Person pursuant to this Section 2.2 in exchange or substitution for or upon registration of transfer of any Securities, such successor Person, at the option of the Holders but without expense to them, shall provide for the exchange of all Securities at the time outstanding for Securities authenticated and delivered in such new name.
 
SECTION 2.3      Registrar and Paying Agent.  The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Securities may be presented for payment (the “Paying Agent”).  The Company shall cause each of the Registrar and the Paying Agent to maintain an office or agency in the Borough of Manhattan, The City of New York.  The Registrar shall keep a register of the Securities and of their transfer and exchange (the “Note Register”).  The Company may have one or more co-registrars and one or more additional paying agents.  The term “Paying Agent” includes any additional paying agent.
 
The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent or co-registrar not a party to this Indenture, which shall incorporate the terms of the TIA.  The agreement shall implement the provisions of this Indenture that relate to such agent.  The Company shall promptly notify the Trustee in writing of the name and address of each such agent.  If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar, co-registrar or transfer agent.
 
The Company initially appoints DTC to act as depository with respect to the Global Securities.  The Trustee is authorized to enter into a letter of representations with DTC in the form provided to the Trustee by the Company and to act in accordance with such letter.
 
 
 
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The Company initially appoints the Trustee as Registrar and Paying Agent for the Securities.
 
SECTION 2.4      Paying Agent To Hold Money in Trust.  By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal or interest when due.  The Company shall require each Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for the benefit of Securityholders or the Trustee all money held by such Paying Agent for the payment of principal of or interest on the Securities and shall promptly notify the Trustee in writing of any default by the Company in making any such payment.  If the Company or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund.  The Company at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee and to account for any funds disbursed by such Paying Agent.  Upon complying with this Section 2.4, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money delivered to the Trustee.  Upon any bankruptcy, reorganization or similar proceeding with respect to the Company, the Trustee shall serve as Paying Agent for the Securities.
 
SECTION 2.5      Securityholder Lists.  The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders and shall otherwise comply with TIA section 312(a). If the Trustee is not the Registrar, or to the extent otherwise required under the TIA, the Company shall furnish to the Trustee, in writing at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders and the Company shall otherwise comply with TIA section 312(a).
 
SECTION 2.6      Transfer and Exchange. (a)  The following provisions shall apply with respect to any proposed transfer of a beneficial interest in a Rule 144A Global Note or in an Institutional Accredited Investor Global Note or any Definitive Security issued in exchange therefor prior to the date which is two years after the later of the date of its original issue and the last date on which the Company or any Affiliate of the Company was the owner of such Securities (or any predecessor thereto) (the “Resale Restriction Termination Date”):
 
(i) a transfer thereof to a QIB in reliance on Rule 144A shall be made upon the representation of the transferee in the form as set forth on the reverse of the Security that it is purchasing for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the proposed transferee has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;
 
 
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(ii) a transfer thereof to an IAI shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.7 from the proposed transferee and, if requested by the Company or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each of them; and
 
(iii) a transfer thereof to a Non-U.S.  Person in reliance on Regulation S shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.8 from the proposed transferee and, if requested by the Company or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each of them.
 
(b)  The following provisions shall apply with respect to any proposed transfer of a beneficial interest in a Regulation S Global Note or any Definitive Securities issued in exchange therefor prior to the expiration of the Restricted Period:
 
(i) a transfer thereof to a QIB in reliance on Rule 144A shall be made upon the representation of the transferee, in the form of assignment set forth on the reverse of the Securities, that it is purchasing the Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the proposed transferee has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;
 
(ii) a transfer thereof to an IAI shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.7 from the proposed transferee and, if requested by the Company or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each of them; and
 
(iii) a transfer thereof to a Non-U.S.  Person in reliance on Regulation S shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.8 hereof from the proposed transferee and, if requested by the Company or the Trustee, receipt by the Trustee or its agent of an opinion of counsel, certification and/or other information satisfactory to each of them.
 
After the expiration of the Restricted Period, beneficial interests in the Regulation S Global Note or Definitive Securities issued in exchange therefor may be transferred without requiring the certification set forth in Section 2.7 or Section 2.8 or any additional certification.
 
 
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(c)  Restricted Securities Legend.  Upon the transfer, exchange or replacement of Securities not bearing a Restricted Securities Legend, the Registrar shall deliver Securities that do not bear a Restricted Securities Legend.  Upon the transfer, exchange or replacement of Securities bearing a Restricted Securities Legend, the Registrar shall deliver only Securities that bear a Restricted Securities Legend unless such Securities are Exchange Securities issued in a Registered Exchange Offer or are otherwise sold under an effective registration statement under the Securities Act or there is delivered to the Registrar an Opinion of Counsel to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act.
 
(d)  The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.1 or this Section 2.6. The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable prior written notice to the Registrar.
 
(e)  Obligations with Respect to Transfers and Exchanges of Securities.
 
(i)  To permit registrations of transfers and exchanges, the Company shall, subject to the other terms and conditions of this Article II, execute, and the Trustee shall authenticate, Definitive Securities and Global Securities at the Registrar’s or co-registrar’s request.
 
(ii)  No service charge shall be made to a Holder for any registration of transfer or exchange, but the Company may require from a Holder payment of a sum sufficient to cover any transfer tax, assessments or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant to Section 9.5).
 
(iii)  The Registrar or co-registrar shall not be required (A) to issue, to register the transfer of or to exchange any Security during a period beginning at the opening of 15 days before the day of mailing of a notice of redemption of Securities for redemption and ending at the close of business on the day of such mailing, (B) to register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) to register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 
(iv)  Prior to the due presentation for registration of transfer of any Security, the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar may deem and treat the Person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and neither the Company, the Trustee, the Paying Agent, the Registrar nor any co-registrar shall be affected by notice to the contrary.
 
 
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(v)  Any Definitive Security delivered in exchange for an interest in a Global Security pursuant to Section 2.1(d) shall, except as otherwise provided by Section 2.6(c), bear the applicable legend regarding transfer restrictions applicable to the Definitive Security set forth in Section 2.1(c).
 
(vi)  All Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Securities surrendered upon such transfer or exchange.
 
(f)  No Obligation of the Trustee.
 
(i)  The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in, DTC or other Person with respect to the accuracy of the records of DTC or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than DTC) of any notice (including any notice of redemption) or the payment of any amount or delivery of any Securities (or other security or property) under or with respect to such Securities.  All notices and communications to be given to the Holders and all payments to be made to Holders in respect of the Securities shall be given or made only to or upon the order of the registered Holders (which shall be DTC or its nominee in the case of a Global Security).  The rights of beneficial owners in any Global Security shall be exercised only through DTC subject to the applicable rules and procedures of DTC.  The Trustee may conclusively rely and shall be fully protected in relying upon information furnished by DTC with respect to its members, participants and any beneficial owners.
 
(ii)  The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among DTC participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
 
SECTION 2.7      Form of Certificate to be Delivered in Connection with Transfers to Institutional Accredited Investors.
 
[Date]
 
 
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The Black & Decker Corporation
c/o The Bank of New York
101 Barclay Street, 8W
New York, New York 10286
Attention:  Corporate Trust Administration
 
Ladies and Gentlemen:
 
This certificate is delivered to request a transfer of $_________ principal amount of the 4 3/4% Senior Notes Due 2014 (the “Notes”) of The Black & Decker Corporation (the “Company”).
 
Upon transfer, the Notes would be registered in the name of the new beneficial owner as follows:
         
 
Name:
 
         
  Address:  
         
  Taxpayer ID Number:  
 
The undersigned represents and warrants to you that:
 
1.  We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the “Securities Act”)) purchasing for our own account or for the account of such an institutional “accredited investor” at least $250,000 principal amount of the Notes, and we are acquiring the Notes not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act.  We have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risk of our investment in the Notes and we invest in or purchase securities similar to the Notes in the normal course of our business.  We and any accounts for which we are acting are each able to bear the economic risk of our or its investment.
 
2.  We understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence.  We agree on our own behalf and on behalf of any investor account for which we are purchasing Notes to offer, sell or otherwise transfer such Notes prior to the date which is two years after the later of the date of original issue and the last date on which the Company or any affiliate of the Company was the owner of such Notes (or any predecessor thereto)  (the “Resale Restriction Termination Date”) only (a) to the Company, (b) pursuant to a registration statement which has been declared effective under the Securities Act, (c) in a transaction complying with the requirements of Rule 144A under the Securities Act (“Rule 144A”), to a person we reasonably believe is a qualified institutional buyer under Rule 144A (a “QIB”) that purchases for its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is purchasing for its own account or for the account of such an institutional “accredited investor,” in each case in a minimum principal amount of Notes of $250,000 or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property or the property of such investor account or accounts be at all times within our or their control and in compliance with any applicable state securities laws.  The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date.  If any resale or other transfer of the Notes is proposed to be made pursuant to clause (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Company and the Trustee, which shall provide, among other things, that the transferee is an institutional “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act) that is acquiring such Notes for investment purposes and not for distribution in violation of the Securities Act.  Each purchaser acknowledges that the Company and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Restriction Termination Date of the Notes pursuant to clauses (d), (e) or (f) above to require the delivery of an opinion of counsel, certifications and/or other information satisfactory to the Company and the Trustee.
 
TRANSFEREE:
 
   
BY:
 
 
 
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SECTION 2.8      Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S.
 
 
[Date]
 
The Black & Decker Corporation
c/o The Bank of New York
101 Barclay Street, 8W
New York, New York 10286
Attention:  Corporate Trust Administration
 
 
Re:
The Black & Decker Corporation
4 3/4%  Senior Notes Due 2014 (the “Securities”)
 
Ladies and Gentlemen:
 
In connection with our proposed sale of $________ aggregate principal amount of the Securities, we confirm that such sale has been effected pursuant to and in accordance with Regulation S under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, we represent that:
 
(a) the offer of the Securities was not made to a person in the United States;
 
 
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(b) either (i) at the time the buy order was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States or (ii) the transaction was executed in, on or through the facilities of a designated off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged with a buyer in the United States;
 
(c) no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(a)(2) or Rule 904(a)(2) of Regulation S, as applicable; and
 
(d) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.
 
In addition, if the sale is made during a distribution compliance period and the provisions of Rule 903(b)(2) or Rule 904(b)(1) of Regulation S are applicable thereto, we confirm that such sale has been made in accordance with the applicable provisions of Rule 903(b)(2) or Rule 904(b)(1), as the case may be.
 
You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.  Terms used in this certificate have the meanings set forth in Regulation S.
 
Very truly yours,
 
[Name of Transferor]
 
By:
 
 
Authorized Signature

SECTION 2.9      Mutilated, Destroyed, Lost or Stolen Securities.  If a mutilated Security is surrendered to the Registrar or if the Holder of a Security claims that the Security has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security if the requirements of Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies any other reasonable requirements of the Trustee.  Such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss which any of them may suffer if a Security is replaced, and, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and upon Company Order the Trustee shall authenticate and make available for delivery, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.
 
 
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In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.
 
Upon the issuance of any new Security under this Section 2.9, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith.
 
Every new Security issued pursuant to this Section 2.9 in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company and any other obligor upon the Securities, whether or not the mutilated, destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.
 
The provisions of this Section 2.9 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.
 
SECTION 2.10          Outstanding Securities.  Securities outstanding at any time are all Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those paid pursuant to Section 2.9 and those described in this Section 2.10 as not outstanding.  A Security ceases to be outstanding in the event the Company or a Subsidiary holds the Security; provided, however, that (a) for purposes of determining which are outstanding for consent or voting purposes hereunder, Securities shall cease to be outstanding in the event the Company or an Affiliate of the Company holds the Security and (b) in determining whether the Trustee shall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Securities are present at a meeting of Holders of Securities for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Securities which a Trust Officer of the Trustee actually knows to be held by the Company or an Affiliate of the Company shall not be considered outstanding.
 
If a Security is replaced pursuant to Section 2.9, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Security is held by a bona fide purchaser.
 
If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Securityholders on that date pursuant to the terms of this Indenture, then on and after that date such Securities (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
 
 
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SECTION 2.11          Temporary Securities.  Until Definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities.  Temporary Securities shall be substantially in the form of Definitive Securities but may have variations that the Company considers appropriate for temporary Securities.  Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Definitive Securities.  After the preparation of Definitive Securities, the temporary Securities shall be exchangeable for Definitive Securities upon surrender of the temporary Securities at any office or agency maintained by the Company for that purpose and such exchange shall be without charge to the Holder.  Upon surrender for cancellation of any one or more temporary Securities, the Company shall execute, and the Trustee shall authenticate and make available for delivery in exchange therefor, one or more Definitive Securities representing an equal principal amount of Securities.  Until so exchanged, the Holder of temporary Securities shall in all respects be entitled to the same benefits under this Indenture as a holder of Definitive Securities.
 
SECTION 2.12          Cancellation.  The Company at any time may deliver Securities to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment.  The Trustee and no one else shall cancel and return to the Company all Securities surrendered for registration of transfer, exchange, payment or cancellation.  The Company may not issue new Securities to replace Securities it has paid or delivered to the Trustee for cancellation for any reason other than in connection with a transfer or exchange.
 
SECTION 2.13          Payment of Interest; Defaulted Interest.  Interest on any Security which is payable, and is punctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Security (or one or more predecessor Securities) is registered at the close of business on the regular record date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 2.3.
 
Any interest on any Security which is payable, but is not paid when the same becomes due and payable and such nonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder on the regular record date by virtue of having been such Holder, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Securities (such defaulted interest and interest thereon herein collectively called “Defaulted Interest”) shall be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:
 
(a)  The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities (or their respective predecessor Securities) are registered at the close of business on a Special Record Date (as defined below) for the payment of such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security and the date (not less than 30 days after such notice) of the proposed payment (the “Special Interest Payment Date”), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a record date (the “Special Record Date”) for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the Special Interest Payment Date and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company of such Special Record Date, and in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor to be given in the manner provided for in Section 10.2, not less than 10 days prior to such Special Record Date.  Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names the Securities (or their respective predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (b).
 
 
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(b)  The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.
 
Subject to the foregoing provisions of this Section 2.13, each Security delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.
 
SECTION 2.14          Computation of Interest.  Interest on the Securities shall be computed on the basis of a 360-day year of twelve 30-day months.
 
SECTION 2.15          CUSIP and ISIN Numbers.  The Company in issuing the Securities may use “CUSIP” and “ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such CUSIP or ISIN numbers.  The Company shall promptly notify the Trustee in writing of any change in the CUSIP and ISIN numbers.
 
 
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ARTICLE III
 
Covenants
 
SECTION 3.1            Payment of Securities.  The Company shall promptly pay the principal of and interest on the Securities on the dates and in the manner provided in the Securities and in this Indenture.  Principal and interest shall be considered paid on the date due if on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Securityholders on that date.
 
The Company shall pay interest on overdue principal at the rate specified therefor in the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
 
Notwithstanding anything to the contrary contained in this Indenture, the Company may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder.
 
SECTION 3.2            Limitation on Liens.
 
(a)  The Company will not, and will not permit any Subsidiary to, directly or indirectly, as security for any Debt, mortgage, pledge or create or permit to exist any lien on any shares of stock, indebtedness or other obligations of a Subsidiary or any Principal Property, whether such shares of stock, indebtedness or other obligations of a Subsidiary or Principal Property are owned at the date of the Indenture or hereafter acquired, unless the Company secures or causes to be secured any outstanding Securities equally and ratably with all Debt secured by such mortgage, pledge or lien, so long as that Debt shall be secured; provided, however, that the foregoing limitation shall not apply in the case of (i) the creation of any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired (including acquisitions by way of merger or consolidation) by the Company or a Subsidiary contemporaneously with such acquisition, or within 120 days thereafter, to secure or provide for the payment or financing of any part of the purchase price thereof, or the assumption of any mortgage, pledge or other lien upon any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired existing at the time of such acquisition, or the acquisition of any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property subject to any mortgage, pledge or other lien without the assumption thereof, provided that any mortgage, pledge or lien referred to in this clause (i) shall attach only to the shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property so acquired and fixed improvements thereon, (ii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property existing on the date that the Securities are first issued, (iii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property in favor of the Company or any Subsidiary, (iv) any mortgage, pledge or other lien on a Principal Property being constructed or improved securing Debt incurred to finance the construction or improvements, (v) any mortgage, pledge or other lien on shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property incurred in connection with the issuance by a state or political subdivision thereof of any securities the interest on which is exempt from federal income taxes by virtue of Section 103 of the United States Internal Revenue Code of 1986, as amended, or any other laws and regulations in effect at the time of such issuance and (vi) any renewal of or substitution for any mortgage, pledge or other lien permitted by any of the preceding clauses (i) through (v), provided, in the case of a mortgage, pledge or other lien permitted under clause (i), (ii) or (iv), the Debt secured is not increased nor the lien extended to any additional assets.
 
 
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(b)  Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may create or assume liens in addition to those permitted by the foregoing paragraph (a), and renew, extend or replace such liens, provided that at the time of such creation, assumption, renewal, extension or replacement, and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 3.3            Limitation on Sale Leaseback Transactions. (a)  The Company will not, and will not permit, any Subsidiary to, sell or transfer, directly or indirectly, except to the Company or a Subsidiary, a Principal Property as an entirety, or any substantial portion thereof, with the intention of taking back a lease of all or part of such property except a lease for a period of three years or less at the end of which it is intended that the use of such property by the lessee will be discontinued, provided that, notwithstanding the foregoing, the Company or any Subsidiary may sell a Principal Property and lease it back for a longer period (i) if the Company or such Subsidiary would be entitled, pursuant to Section 3.2, to create a mortgage on the property to be leased securing Debt in an amount equal to the Attributable Debt with respect to the sale and lease-back transaction without equally and ratably securing the outstanding Securities or (ii) if (A) the Company promptly informs the Trustee of such transactions, (B) the net proceeds of such transaction are at least equal to the fair value (as determined by a Board Resolution) of such property and (C) the Company causes an amount equal to the net proceeds of the sale to be applied to the retirement (whether by redemption, cancellation after open-market purchases, or otherwise), within 120 days after receipt of such proceeds, of Funded Debt having an outstanding principal amount equal to the net proceeds.
 
(b)  Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may enter into sale and lease-back transactions in addition to those permitted by the foregoing paragraph (a), and without any obligation to retire any outstanding Funded Debt, provided that at the time of entering into such sale and lease-back transactions and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 3.4            Maintenance of Office or Agency.  The Company shall maintain in The City of New York an office or agency where the Securities may be presented or surrendered for payment, where, if applicable, the Securities may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served.  The principal corporate trust office (the “Corporate Trust Office”) of the Trustee located in The City of New York shall be such office or agency of the Company, unless the Company shall designate and maintain some other office or agency for one or more of such purposes.  The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
 
 
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The Company may also from time to time designate one or more other offices or agencies (in or outside of The City of New York) where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in The City of New York for such purposes.  The Company shall give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such other office or agency.
 
SECTION 3.5            Compliance Certificate.  The Company shall deliver to the Trustee within 120 days after the end of each Fiscal Year of the Company an Officers’  Certificate stating that in the course of the performance by the signers of their duties as Officers of the Company they would normally have knowledge of any Default or Event of Default and whether or not the signers know of any Default or Event of Default that occurred during such period.  If they do, the certificate shall describe the Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto.  The Company also shall comply with TIA section 314(a)(4).
 
SECTION 3.6            Statement by Officers as to Default.  The Company shall deliver to the Trustee within 10 days after the Company becomes aware of the occurrence of any Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default, an Officers’  Certificate setting forth the details of such Default or Event of Default and the action which the Company proposes to take with respect thereto.
 
SECTION 3.7            Further Instruments and Acts.  Upon request of the Trustee or as necessary, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
 
 
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ARTICLE IV
 
Successor Company
 
SECTION 4.1            Merger, Consolidation or Sale of All or Substantially All Assets of the Company.  The Company shall not consolidate with or merge into, or transfer, directly or indirectly, all or substantially all of its assets to another corporation or other Person unless (a) the resulting, surviving or transferee corporation or other Person assumes by supplemental indenture all the obligations of the Company under the Securities and this Indenture, (b) immediately after giving effect to such transaction, no Event of Default, and no circumstances that, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing, and (c) the Company shall have delivered to the Trustee an Officers’  Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture comply with this Indenture, and thereafter all such obligations of the Company shall terminate.
 
ARTICLE V
 
Redemption of Securities
 
SECTION 5.1            Optional Redemption.  The Securities may be redeemed, at the option of the Company, at any time in whole, or from time to time in part, subject to the conditions and at the redemption prices specified in the form of Securities set forth in Exhibit A and Exhibit B hereto, which are hereby incorporated by reference and made a part of this Indenture, together with accrued and unpaid interest to the Redemption Date.
 
SECTION 5.2            Applicability of Article.  Redemption of Securities at the election of the Company or otherwise, as permitted by any provision of this Indenture, shall be made in accordance with such provision and this Article V.
 
SECTION 5.3            Election to Redeem; Notice to Trustee.  The election of the Company to redeem any Securities pursuant to Section 5.1 shall be evidenced by a Board Resolution.  In case of any redemption at the election of the Company, the Company shall, upon not later than the earlier of the date that is 30 days prior to the Redemption Date fixed by the Company or the date on which notice is given to the Holders (except as provided in Section 5.5 or unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Securities to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Securities to be redeemed pursuant to Section 5.4.
 
SECTION 5.4            Selection by Trustee of Securities to Be Redeemed.  If less than all the Securities are to be redeemed at the option of the Company at any time pursuant to Section 5.1, the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee from the outstanding Securities not previously called for redemption, in compliance with the requirements of the principal national securities exchange, if any, on which such Securities are listed, or, if such Securities are not so listed, then on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements) and which may provide for the selection for redemption of portions of the principal of the Securities; provided, however, that (a) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (b) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.
 
 
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The Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.
 
For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Securities shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed.
 
SECTION 5.5            Notice of Redemption.  Notice of redemption shall be given in the manner provided for in Section 10.2 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed.  The Trustee shall give notice of redemption in the Company’s name and at the Company’s expense; provided, however, that the Company shall deliver to the Trustee, at least 15 days prior to the date on which such notice is to be given, an Officers’  Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the following items.
 
All notices of redemption shall state:
 
(a) the Redemption Date;
 
(b) the redemption price and the amount of accrued interest to the Redemption Date payable as provided in Section 5.7 if any;
 
(c) if less than all outstanding Securities are to be redeemed, the identification of the particular Securities (or portion thereof) to be redeemed, as well as the aggregate principal amount of Securities to be redeemed and the aggregate principal amount of Securities to be outstanding after such partial redemption;
 
(d) in case any Security is to be redeemed in part only, the notice which relates to such Security shall state that on and after the Redemption Date, upon surrender of such Security, the Holder will receive, without charge, a new Security or Securities of authorized denominations for the principal amount thereof remaining unredeemed;
 
(e) that on the Redemption Date the redemption price (and accrued interest, if any, to the Redemption Date payable as provided in Section 5.7) will become due and payable upon each such Security, or the portion thereof, to be redeemed, and, unless the Company defaults in making the redemption payment, that interest on Securities called for redemption (or the portion thereof) will cease to accrue on and after said date;
 
 
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(f) the place or places where such Securities are to be surrendered for payment of the redemption price and accrued interest, if any;
 
(g) the name and address of the Paying Agent;
 
(h) that Securities called for redemption must be surrendered to the Paying Agent to collect the redemption price;
 
(i) the CUSIP and ISIN numbers, and that no representation is made as to the accuracy or correctness of the CUSIP and ISIN numbers, if any, listed in such notice or printed on the Securities; and
 
(j) the paragraph of the Securities pursuant to which the Securities are to be redeemed.
 
SECTION 5.6            Deposit of Redemption Price.  Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 2.4) an amount of money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on that date.
 
SECTION 5.7            Securities Payable on Redemption Date.  Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the redemption price therein specified (together with accrued interest, if any, to the Redemption Date), and from and after such date (unless the Company shall default in the payment of the redemption price and accrued interest) such Securities shall cease to bear interest.  Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the redemption price, together with accrued interest, if any, to the Redemption Date (subject to the rights of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).
 
If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid, bear interest from the Redemption Date at the rate borne by the Securities.
 
SECTION 5.8            Securities Redeemed in Part.  Any Security which is to be redeemed only in part pursuant to the provisions of this Article V shall be surrendered at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Security at the expense of the Company, a new Security or Securities, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered, provided that each such new Security will be in a principal amount of $1,000 or integral multiple thereof.
 
 
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ARTICLE VI
 
Defaults and Remedies
 
SECTION 6.1            Events of Default.  An “Event of Default” occurs if:
 
(a) the Company defaults in any payment of interest or additional interest (as required by the Exchange and Registration Rights Agreement) on any Security when the same becomes due and payable, and such default continues for a period of 30 days;
 
(b) the Company defaults in the payment of the principal on any Security when the same becomes due and payable at its Stated Maturity, upon optional redemption, upon declaration or otherwise;
 
(c) the Company defaults in the performance of or breaches any covenant or agreement in this Indenture or under the Securities, other than those referred to in paragraph (a) or (b) above, and such default continues for 30 days after written notice (which notice must specify the default, demand that it be remedied and state that the notice is a “Notice of Default”) from the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities;
 
(d) the Company or any of its Subsidiaries fails to pay, in accordance with its terms and when payable, any of the principal, interest or additional amounts, if any, on any Debt (including the Securities, other than the Securities, if any, with respect to which the failure to pay principal, interest or additional interest is also an Event of Default under Section 6.1(a), 6.1(b) or both) having, in the aggregate, a then-outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (ii) the maturity of Debt in an aggregate principal amount in excess of $50,000,000 is accelerated, if such acceleration results from a default under the instrument giving rise to or securing such Debt;
 
(e) the Company pursuant to or within the meaning of any Bankruptcy Law (as defined below):
 
(i) commences a voluntary case;
 
(ii) consents to the entry of an order for relief against it in an involuntary case;
 
(iii) consents to the appointment of a Custodian (as defined below) of it or for any substantial part of its property; or
 
 
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(iv) makes a general assignment for the benefit of its creditors;
 
or
 
(f) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
 
(i) is for relief against the Company in an involuntary case;
 
(ii) appoints a Custodian of the Company for all or substantially all of the Company’s property; or
 
(iii) orders the winding up or liquidation of the Company; and in each case the order or decree remains unstayed and in effect for 60 days.
 
The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.
 
The term “Bankruptcy Law” means Title 11, United States Code, or any similar federal or state law for the relief of debtors.  The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
 
SECTION 6.2            Acceleration.  If an Event of Default described in clauses (a), (b), (c) and (d) of Section 6.1 occurs and is continuing, the Trustee, or the Holders of at least 25% in outstanding principal amount of the Securities, by notice to the Company, may, and the Trustee at the written request of such Holders shall, declare the principal of and accrued and unpaid interest, if any, on all the Securities to be due and payable.  Upon such a declaration, such principal and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clauses (e) and (f) above occurs and is continuing, the principal of and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
SECTION 6.3            Other Remedies.  If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture.
 
The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative.
 
 
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SECTION 6.4            Waiver of Past Defaults.  The Holders of a majority in principal amount of the outstanding Securities by notice to the Trustee may (a) waive, by their consent (including, without limitation consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities), an existing Default or Event of Default and its consequences except (i) a Default or Event of Default in the payment of the principal of or interest on a Security or (ii) a Default or Event of Default in respect of a provision that under Section 9.2 cannot be amended without the consent of each Securityholder affected and (b) rescind any such acceleration with respect to the Securities and its consequences if (i) rescission would not conflict with any judgment or decree of a court of competent jurisdiction and (ii) all existing Events of Default, other than the nonpayment of the principal of and interest on the Securities that have become due solely by such declaration of acceleration, have been cured or waived.  When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right.
 
SECTION 6.5            Control by Majority.  The Holders of a majority in principal amount of the outstanding Securities may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee.  However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or, subject to Section 7.1 and Section 7.2, that the Trustee determines is unduly prejudicial to the rights of other Securityholders or would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction.  Prior to taking any action hereunder, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.
 
SECTION 6.6            Limitation on Suits.  Subject to Section 6.7, a Securityholder may not pursue any remedy with respect to this Indenture or the Securities unless:
 
(a) the Holder gives to the Trustee written notice stating that an Event of Default is continuing;
 
(b) the Holders of at least 25% in outstanding principal amount of the Securities make a request to the Trustee to pursue the remedy;
 
(c) such Holder or Holders offer to the Trustee commercially reasonable security or indemnity satisfactory to the Trustee against any loss, liability or expense;
 
(d) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and
 
(e) the Holders of a majority in principal amount of the Securities do not give the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such request during such 60-day period.
 
 
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A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over another Securityholder, it being understood and intended that no one or more of such Securityholders will have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb, or prejudice the rights of any other of such Securityholders (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances are unduly prejudicial to such Securityholders).
 
SECTION 6.7            Rights of Holders to Receive Payment.  Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.6), the right of any Holder to receive payment of principal of or interest on the Securities held by such Holder, on or after the respective due dates expressed in the Securities, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.
 
SECTION 6.8            Collection Suit by Trustee.  If an Event of Default specified in Section 6.1(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount then due and owing (together with interest on any unpaid interest to the extent lawful) and the amounts provided for in Section 7.7.
 
SECTION 6.9            Trustee May File Proofs of Claim.  The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Securityholders allowed in any judicial proceedings relative to the Company, its Subsidiaries or its or their respective creditors or properties and may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.7.
 
SECTION 6.10           Priorities.  If the Trustee collects any money or property pursuant to this Article VI, it shall pay out the money or property in the following order:
 
FIRST:  to the Trustee for amounts due under Section 7.7;
 
SECOND: to Securityholders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and
 
THIRD:  to the Company.
 
 
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The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section 6.10.  At least 15 days before such record date, the Company shall mail to each Securityholder and the Trustee a notice that states the record date, the payment date and amount to be paid.
 
SECTION 6.11          Undertaking for Costs.  In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section 6.11 does not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.7 or a suit by Holders of more than 10% in outstanding principal amount of the Securities.
 
ARTICLE VII
 
Trustee
 
SECTION 7.1            Duties of Trustee.  (a)  If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs, provided that if an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee commercially reasonable indemnity or security satisfactory to it against any loss, liability or expense (other than as provided in clause (c) below).
 
(b)  Except during the continuance of an Event of Default:
 
(i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
 
(ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
 
 
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(c)  The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
 
(i) this paragraph does not limit the effect of paragraph (b) of this Section 7.1;
 
(ii) the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
 
(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.5.
 
(d)  Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.1.
 
(e)  The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.
 
(f)  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
 
(g)  No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
 
(h)  Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.1 and to the provisions of the TIA.
 
(i)  Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer.
 
(j)  The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee commercially reasonable security or indemnity satisfactory to it against any loss, liability or expense (including reasonable attorneys’  fees and expenses) that might be incurred by it in compliance with such request or direction.
 
SECTION 7.2            Rights of Trustee.  Subject to Section 7.1,
 
(a)  The Trustee may conclusively rely on any document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper Person.  The Trustee need not investigate any fact or matter stated in the document.
 
 
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(b)  Before the Trustee acts or refrains from acting, it may require an Officers’  Certificate and/or an Opinion of Counsel.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officers’ Certificate or Opinion of Counsel.
 
(c)  The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
 
(d)  The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers; provided, however, that the Trustee’s conduct does not constitute willful misconduct or negligence.
 
(e)  The Trustee may consult with counsel of its selection, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
 
(f)  The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make further inquiry or investigation into such facts or matters as it may see fit, personally or by agent or attorney, at the sole cost of the Company and with the Company’s cooperation and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
 
(g)  The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
 
(h)  In no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
 
(i)  The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture.
 
(j)  The Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.
 
 
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SECTION 7.3            Individual Rights of Trustee.  The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.  Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights.  However, the Trustee must comply with Section 7.10 and Section 7.11.  In addition, the Trustee shall be permitted to engage in transactions with the Company; provided, however, that if the Trustee acquires any conflicting interest the Trustee must (a) eliminate such conflict within 90 days of acquiring such conflicting interest, (b) apply to the SEC for permission to continue acting as Trustee or (c) resign.
 
SECTION 7.4            Trustee’s Disclaimer.  The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Securities, shall not be accountable for the Company’s use of the proceeds from the Securities and shall not be responsible for any statement of the Company in this Indenture or in any document issued in connection with the sale of the Securities or in the Securities other than the Trustee’s certificate of authentication.
 
SECTION 7.5            Notice of Defaults.  If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall mail to each Securityholder at the address set forth in the Note Register notice of the Default or Event of Default within 90 days after it occurs.  Except in the case of a Default or Event of Default in payment of principal of or interest on any Security (including payments pursuant to the optional redemption provisions of such Security), the Trustee may withhold the notice if and so long as its Board of Directors, a committee of its Board of Directors or a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Securityholders.
 
SECTION 7.6            Reports by Trustee to Holders.  As promptly as practicable after each May 15 beginning with the May 15 following the date of this Indenture, and in any event prior to July 15 in each year, the Trustee shall mail to each Securityholder a brief report dated as of such May 15 that complies with TIA section 313(a) if such report is required by such section.  The Trustee also shall comply with TIA section 313(b).  The Trustee shall also transmit by mail all reports required by TIA section 313(c).
 
A copy of each report at the time of its mailing to Securityholders shall be filed with the SEC and each stock exchange (if any) on which the Securities are listed.  The Company agrees to notify promptly the Trustee whenever the Securities become listed on any stock exchange and of any delisting thereof.
 
SECTION 7.7            Compensation and Indemnity.  The Company shall pay to the Trustee from time to time such compensation for its acceptance of this Indenture and services hereunder as the Company and the Trustee shall from time to time agree in writing.  The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Company shall reimburse the Trustee upon request for all reasonable out-of- pocket expenses incurred or made by it, including costs of collection, costs of preparing and reviewing reports, certificates and other documents, costs of preparation and mailing of notices to Securityholders and reasonable costs of counsel retained by Trustee in connection with the delivery of an Opinion of Counsel or otherwise, in addition to the compensation for its services.  Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s agents, counsel, accountants and experts.  The Company shall indemnify the Trustee against any and all loss, liability, damages, claims or expense (including reasonable attorneys’ fees and expenses) incurred by it without negligence or bad faith on its part in connection with the acceptance or administration of this trust and the performance of its duties hereunder, including the costs and expenses of enforcing this Indenture (including this Section 7.7) and of defending itself against any claims (whether asserted by any Securityholder, the Company or otherwise).  The Trustee shall notify the Company promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder.  The Company shall defend the claim and the Trustee shall provide reasonable cooperation in the defense.  The Trustee may have separate counsel and the Company shall pay the fees and expenses of such counsel, provided that the Company shall not be required to pay such fees and expenses if it assumes the Trustee’s defense, and, in the reasonable judgment of counsel to the Trustee, there is no conflict of interest between the Company and the Trustee in connection with such defense.  The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
 
 
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To secure the Company’s payment obligations in this Section 7.7 the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee, other than money or property held in trust to pay principal of and interest on particular Securities.  The Trustee’s right to receive payment of any amounts due under this Section 7.7 shall not be subordinate to any other liability or Debt of the Company.
 
The Company’s payment obligations pursuant to this Section 7.7 shall survive the discharge of this Indenture.  When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.1(e) or (f) with respect to the Company, the expenses are intended to constitute expenses of administration under any Bankruptcy Law.
 
SECTION 7.8            Replacement of Trustee.  The Trustee may resign at any time by so notifying the Company.  The Holders of a majority in principal amount of the Securities may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee.  The Company shall remove the Trustee if:
 
(a) the Trustee fails to comply with Section 7.10;
 
(b) the Trustee is adjudged bankrupt or insolvent;
 
(c) a receiver or other public officer takes charge of the Trustee or its property; or
 
(d) the Trustee otherwise becomes incapable of acting.
 
If the Trustee resigns or is removed by the Company or by the Holders of a majority in principal amount of the Securities and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of the Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee.
 
 
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A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of its succession to Securityholders.  The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.7.
 
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of 10% in principal amount of the Securities may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee.
 
If the Trustee fails to comply with Section 7.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
 
Notwithstanding the replacement of the Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7 shall continue for the benefit of the retiring Trustee.
 
SECTION 7.9            Successor Trustee by Merger.  If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.
 
In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture, any of the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor to the Trustee, provided that the right to adopt the certificate of authentication of any predecessor Trustee or authenticate Securities in the name of any predecessor Trustee shall only apply to its successor or successors by merger, consolidation or conversion.
 
SECTION 7.10          Eligibility; Disqualification.  The Trustee shall at all times satisfy the requirements of TIA section 310(a).  The Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.  The Trustee shall comply with TIA section 310(b); provided, however, that there shall be excluded from the operation of TIA section 310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in TIA section 310(b)(1) are met.
 
 
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SECTION 7.11          Preferential Collection of Claims Against Company.  The Trustee shall comply with TIA section 311(a), excluding any creditor relationship listed in TIA section 311(b).  A Trustee who has resigned or been removed shall be subject to TIA section 311(a) to the extent indicated.
 
ARTICLE VIII
 
Satisfaction and Discharge of Indenture
 
SECTION 8.1            Option To Effect Legal Defeasance or Covenant Defeasance.  The Company may, at the option of its Board of Directors evidenced by a Board Resolution, at any time, elect to have either Section 8.2 or Section 8.3 be applied to all outstanding Securities upon compliance with the conditions set forth below in this Article VIII.
 
SECTION 8.2            Legal Defeasance and Discharge.  Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.2, the Company shall be deemed to have been discharged from its obligations under this Indenture with respect to all outstanding Securities on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, such Legal Defeasance means that the Company shall be deemed to have paid and discharged all the obligations relating to the outstanding Securities and such Securities shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.6 and Section 8.8, and to have satisfied all of its other obligations under such Securities and this Indenture and cured all then existing Events of Default with respect to such Securities (and the Trustee, on demand of and at the expense of the Company shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder:  (a) the rights of Holders of outstanding Securities to receive payments in respect of the principal and accrued interest on such Securities when such payments are due or on the Redemption Date solely out of the trust created pursuant to this Indenture; (b) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s obligations in connection therewith; and (c) this Article VIII and the obligations set forth in Section 8.6 hereof.
 
SECTION 8.3            Covenant Defeasance.  Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.3, the Company shall be released from any obligations under the covenants contained in Section 3.2 and Section 3.3 hereof with respect to the outstanding Securities on and after the date the conditions set forth below are satisfied (hereinafter, “Covenant Defeasance”), and the Securities shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Securities shall not be deemed outstanding for accounting purposes).  For this purpose, such Covenant Defeasance means that, with respect to the outstanding Securities, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default with respect to the Securities under Section 6.1(c), nor shall any event referred to in Section 6.1(d) thereafter constitute a Default or Event of Default with respect to the Securities, but, except as specified above, the remainder of this Indenture and such Securities shall be unaffected thereby.
 
 
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SECTION 8.4            Conditions to Legal or Covenant Defeasance.  The following shall be the conditions to the application of either Section 8.2 or Section 8.3 to the outstanding Securities:
 
(a) in the case of Legal Defeasance, either (i) all Securities theretofore authenticated and delivered under the Indenture must have been delivered to the Trustee for cancellation or (ii) the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Securities on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Securities;
 
(b) in the case of Covenant Defeasance, the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Securities on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Securities;
 
(c) in the case of Legal Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, (i) the Company has received from, or there has been published by, the U.S.  Internal Revenue Service a ruling or (ii) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, subject to customary assumptions and exclusions, the Holders will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
 
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(d) in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the Holders will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
 
(e) such Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument to which the Company is a party or by which the Company is bound;
 
(f) in the case of Legal Defeasance, 91 days shall have passed during which no Event of Default under Section 6.1(e) or Section 6.1(f) has occurred;
 
(g) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent to the defeasance and discharge of the Securities and this Indenture as contemplated by this Article VIII have been complied with; and
 
(h) the Company shall have delivered to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and accrued interest when due and without reinvestment on the deposited U.S.  Government Securities plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal and accrued interest when due on all the Securities to maturity.
 
SECTION 8.5            Satisfaction and Discharge of Indenture.  This Indenture will be discharged with respect of the Securities and will cease to be of further effect as to all Securities issued thereunder, when either (a) all such Securities theretofore authenticated and delivered (except lost, stolen or destroyed Securities which have been replaced or paid and Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company) have been delivered to the Trustee for cancellation; or (b)(i) all such Securities not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust an amount of money in U.S. dollars or U.S. Government Securities or any combination thereof sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation for principal and accrued and unpaid interest to the date of maturity or redemption; (ii) no Default with respect to the Securities shall have occurred within 91 days of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company is a party or by which it is bound; (iii) the Company has paid or caused to be paid all sums payable by it with respect to the Securities under this Indenture; and (iv) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of such Securities at maturity or the Redemption Date, as the case may be.  In addition, with respect to clause (b) of the preceding sentence, the Company shall have delivered to the Trustee an Officers’  Certificate and an Opinion of Counsel, stating that all conditions precedent specified herein relating to the satisfaction and discharge of this Indenture have been complied with.
 
 
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SECTION 8.6            Survival of Certain Obligations.  Notwithstanding the satisfaction and discharge of this Indenture referred to in Section 8.1, Section 8.2, Section 8.3, Section 8.4 or Section 8.5, the respective obligations of the Company and the Trustee under Section 2.2, Section 2.3, Section 2.4, Section 2.5, Section 2.6, Section 2.9, Section 2.10, Section 2.11, Section 2.12, Section 3.4, Section 3.5, Section 3.6, Section 3.7, Section 6.7, Section 7.7, Section 7.8 and this Article VIII shall survive until the Securities are no longer outstanding.  Nothing contained in this Article VIII shall abrogate any of the obligations or duties of the Trustee under this Indenture.
 
SECTION 8.7            Acknowledgment of Discharge by Trustee.  Subject to Section 8.10, after (a) the conditions of Section 8.4 or Section 8.5 have been satisfied, (b) the Company has paid or caused to be paid all other sums payable hereunder by the Company and (c) the Company has delivered to the Trustee an Officers’  Certificate and an Opinion of Counsel, each stating that all conditions precedent referred to in clause (a) above relating to the satisfaction and discharge of this Indenture have been complied with, the Trustee upon written request shall acknowledge in writing the discharge of all of the Company’s obligations under this Indenture except for those surviving obligations specified in this Article VIII.
 
SECTION 8.8            Application of Trust Moneys.  All cash in U.S. dollars and U.S.  Government Securities deposited with the Trustee pursuant to Section 8.4 or Section 8.5 shall be held in trust and applied by the Trustee, in accordance with the provisions of this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders, of all sums due and to become due thereon for principal and accrued interest but such money need not be segregated from other funds except to the extent required by law.  The Holder of any Security replaced pursuant to Section 2.9 shall not be entitled to any such payment and shall look only to the Company for any payment which such Holder may be entitled to collect.  In connection with the satisfaction and discharge of this Indenture or the defeasance of certain obligations under this Indenture, the Company may direct the Trustee to (a) invest any money received by the Trustee in the U.S. Government Securities deposited in trust in additional U.S.  Government Securities, and (b) deliver or pay to the Company from time to time upon the request of the Company any money or U.S. Government Securities held by it, which, as evidenced by a certificate from a nationally recognized firm of independent accountants, are in excess of the amount thereof which would then have been required to be deposited for the purpose for which such money or U.S.  Government Securities were deposited or received.
 
 
45
 
 
The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S.  Government Securities deposited pursuant to Section 8.4 or Section 8.5 or the principal or interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders.
 
SECTION 8.9            Repayment to the Company; Unclaimed Money.  The Trustee and any Paying Agent shall promptly pay or return to the Company upon written request any cash or U.S.  Government Securities held by them at any time that are not required for the payment of the principal and interest on the Securities for which cash or U.S. Government Securities have been deposited pursuant to Section 8.4 or Section 8.5.
 
SECTION 8.10          Reinstatement.  If the Trustee or Paying Agent is unable to apply any cash or U.S.  Government Securities in accordance with Section 8.2, Section 8.3, Section 8.4 or Section 8.5 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2, Section 8.3, Section 8.4 or Section 8.5 until such time as the Trustee or Paying Agent is permitted to apply all such cash or U.S. Government Securities in accordance with Section 8.2, Section 8.3, Section 8.4 or Section 8.5; provided, however, that if the Company has made any payment of principal of or interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S.  Government Securities held by the Trustee or Paying Agent.
 
ARTICLE IX
 
Amendments
 
SECTION 9.1            Without Consent of Holders.  The Company and the Trustee may amend this Indenture or the Securities without notice to or consent of any Securityholder:
 
(a) to cure any ambiguity, omission, defect or inconsistency;
 
(b) to comply with Article IV in respect of the assumption by a Successor Company of an obligation of the Company under this Indenture;
 
(c) to add guarantees with respect to the Securities;
 
(d) to secure the Securities;
 
(e) to add to the covenants of the Company for the benefit of the Holders or to surrender any right or power herein conferred upon the Company;
 
(f) to make any change that does not adversely affect the rights of any Securityholder; or
 
 
46
 
 
(g) to comply with any requirement of the SEC in connection with the qualification of this Indenture under the TIA.
 
After an amendment under this Section 9.1 becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment.  The failure to give such notice to all Securityholders at the address set forth in the Note Register, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.1.
 
SECTION 9.2            With Consent of Holders.  The Company and the Trustee may amend this Indenture or the Securities without notice to any Securityholder but with the written consent of the Holders of at least a majority in principal amount of the Securities then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities). However, without the consent of each Securityholder affected, an amendment may not:
 
(a) reduce the amount of Securities whose Holders must consent to an amendment;
 
(b) reduce the stated rate of or extend the stated time for payment of interest on any Security;
 
(c) reduce the principal of or extend the Stated Maturity of any Security;
 
(d) reduce the premium payable upon the redemption of any Security or change the time at which any Security may or shall be redeemed as described above under Article V or any similar provision, whether through an amendment to or waiver of Article V, a definition or otherwise;
 
(e) make any Security payable in money other than that stated in the Security;
 
(f) impair the right of any Holder to receive payment of principal of and interest on such Holder’s Securities on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Securities; or
 
(g) make any change to the amendment provisions which require each Holder’s consent or the waiver provisions in Section 6.4 which require each Holder’s consent.
 
It shall not be necessary for the consent of the Holders under this Section 9.2 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.
 
After an amendment under this Section 9.2 becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment.  The failure to give such notice to all Securityholders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.2.
 
 
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SECTION 9.3            Compliance with Trust Indenture Act.  Every amendment to this Indenture or the Securities shall comply with the TIA as then in effect.
 
SECTION 9.4            Revocation and Effect of Consents and Waivers.  A consent to an amendment or a waiver by a Holder of a Security shall bind the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent or waiver is not made on the Security.  However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or portion of the Security if the Trustee receives the notice of revocation before the date the amendment or waiver becomes effective or otherwise in accordance with any related solicitation documents.  After an amendment or waiver becomes effective, it shall bind every Securityholder.  An amendment or waiver shall become effective upon receipt by the Trustee of the requisite number of written consents under Section 9.1 or Section 9.2 as applicable.
 
The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Securityholders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture.  If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Securityholders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date.  No such consent or action shall be valid or effective if given or taken more than 120 days after such record date.
 
SECTION 9.5            Notation on or Exchange of Securities.  If an amendment changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee.  The Trustee may place an appropriate notation on the Security regarding the changed terms and return it to the Holder.  Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms.  Failure to make the appropriate notation or to issue a new Security shall not affect the validity of such amendment.
 
SECTION 9.6            Trustee To Sign Amendments.  The Trustee shall sign any amendment authorized pursuant to this Article IX if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may but need not sign it.  In signing such amendment the Trustee shall receive indemnity reasonably satisfactory to it and receive, and (subject to Section 7.1 and Section 7.2) shall be fully protected in relying upon, an Officers’  Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture and that such amendment is the legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, subject to customary exceptions, and complies with the provisions hereof (including Section 9.3).
 
 
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ARTICLE X
 
Miscellaneous
 
SECTION 10.1          Trust Indenture Act Controls.  If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.
 
SECTION 10.2          Notices.  Any notice or communication shall be in writing and delivered in person or mailed by first-class mail addressed as follows:
 
if to the Company:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  Treasurer
 
with copies to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  General Counsel
 
Miles & Stockbridge, P.C.
10 Light Street
Baltimore, Maryland 21202
Attention:  J.W. Thompson Webb, Esq.
 
if to the Trustee:
 
The Bank of New York
101 Barclay Street, 8W
New York, New York 10286
Attention:  Corporate Trust Administration
 
The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
 
Any notice or communication mailed to a registered Securityholder shall be mailed by first-class mail to the Securityholder at the Securityholder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed.
 
Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders.  If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
 
 
49
 
 
SECTION 10.3          Communication by Holders with other Holders.  Securityholders may communicate pursuant to TIA section 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities.  The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA section 312(c).
 
SECTION 10.4          Certificate and Opinion as to Conditions Precedent.  Upon any request or application by the Company to the Trustee to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee:
 
(a) an Officers’  Certificate in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and
 
(b) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
 
SECTION 10.5          Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include:
 
(a) a statement that the individual making such certificate or opinion has read such covenant or condition;
 
(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
 
(c) a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and
 
(d) a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.
 
In giving such Opinion of Counsel, counsel may rely as to factual matters on an Officers’ Certificate or on certificates of public officials.
 
SECTION 10.6          When Securities Disregarded.  In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded.  Also, subject to the foregoing, only Securities outstanding at the time shall be considered in any such determination.
 
 
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SECTION 10.7          Rules by Trustee, Paying Agent and Registrar.  The Trustee may make reasonable rules for action by, or a meeting of, Securityholders.  The Registrar and the Paying Agent may make reasonable rules for their functions.
 
SECTION 10.8          Legal Holidays.  A “Legal Holiday” is a Saturday, a Sunday or other day on which commercial banking institutions are authorized or required to be closed in New York City.  If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.  If a regular record date is a Legal Holiday, the record date shall not be affected.
 
SECTION 10.9          GOVERNING LAW; WAIVER OF JURY TRIAL.  THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.  EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.
 
SECTION 10.10        No Recourse Against Others.  An incorporator, director, officer, employee, Affiliate or stockholder of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder shall waive and release all such liability.  The waiver and release shall be part of the consideration for the issue of the Securities.
 
SECTION 10.11        Successors.  All agreements of the Company in this Indenture and the Securities shall bind its successors.  All agreements of the Trustee in this Indenture shall bind its successors.
 
SECTION 10.12        Multiple Originals.  The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.  One signed copy is enough to prove this Indenture.
 
SECTION 10.13        Variable Provisions.  The Company initially appoints the Trustee as Paying Agent and Registrar and custodian with respect to any Global Securities.
 
SECTION 10.14        Table of Contents; Headings.  The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
 
 
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SECTION 10.15        Force Majeure.  In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
 
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
 
 
  THE BLACK & DECKER CORPORATION  
       
 
By:
/s/ Michael D. Mangan  
    Michael D. Mangan  
    Senior Vice President and Chief Financial Officer  
       
 
 
  THE BANK OF NEW YORK, as Trustee  
       
 
By:
/s/ Geovanni Barris  
    Geovanni Barris  
    Vice President  
       
 
 
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EXHIBIT A
 
[FORM OF FACE OF INITIAL SECURITY AND ADDITIONAL SECURITY]
 
[Applicable Restricted Securities Legend]
 
[Depository Legend, if applicable]
 
No. ___
Principal Amount $__________, as revised by the Schedule of Increases and Decreases in Global Security attached hereto
   
 
CUSIP NO. ____________
   
 
           ISIN: ____________

4 3/4% Senior Notes Due 2014
 
The Black & Decker Corporation, a Maryland corporation, promises to pay to __________, or registered assigns, the principal sum of _______________ Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on November 1, 2014.
 
Interest Payment Dates:  May 1 and November 1
Record Dates:  April 15 and October 15
 
Additional provisions of this Security are set forth on the other side of this Security.
 

THE BLACK & DECKER CORPORATION
 
 
By:
 


TRUSTEE’S CERTIFICATE OF
     AUTHENTICATION
     
       
The Bank of New York,
as Trustee, certifies that this
is one of the Securities referred
to in the Indenture.
     
       
By
       
 
Authorized Signatory
 
Date:  October __, 2004
 
 
 
A-1
 

[FORM OF REVERSE SIDE OF INITIAL SECURITY AND ADDITIONAL SECURITY]
 
4 3/4% Senior Note Due 2014
 
1.  Interest
 
The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above.
 
The Company will pay interest semiannually on May 1 and November 1 of each year commencing May 1, 2005.  Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from October 18, 2004. The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Securities to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.
 
If (i) the Registered Exchange Offer is not consummated, or the Shelf Registration Statement, if required, is not declared effective, on or prior to 210 days after the Issue Date or (ii) the Shelf Registration Statement is filed and declared effective within 210 days after the Issue Date but shall thereafter cease to be effective (at any time that the Company is obligated to maintain the effectiveness thereof) without being succeeded within 30 days by an additional Registration Statement filed and declared effective (each such event referred to in clauses (i) and (ii), a “Registration Default”), the annual interest rate borne by this Security shall be increased by 0.25% from the rate shown above during the period of one or more such Registration Defaults until (a) the Registered Exchange Offer is consummated or (b) the Shelf Registration Statement is declared effective or again becomes effective, as the case may be.  Following the cure of all Registration Defaults, the accrual of additional interest will cease.  Capitalized terms used in this paragraph, but not otherwise defined herein shall have the meanings ascribed to such terms in the Exchange and Registration Rights Agreement, dated as of October 18, 2004 (the “Registration Rights Agreement”), among the Company, J.P. Morgan Securities Inc., Banc of America Securities LLC, Citigroup Global Markets Inc. and the other Initial Purchasers named therein.  The Holder of this Security is entitled to the benefits of the Registration Rights Agreement.
 
2.  Method of Payment
 
By at least 10:00 a.m.  (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Securities at the close of business on April 15 or October 15 next preceding the interest payment date even if Securities are cancelled, repurchased or redeemed after the record date and on or before the interest payment date.  Holders must surrender Securities to a Paying Agent to collect principal payments.  The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Securities represented by a Global Security (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company.  Payments in respect of Securities represented by Definitive Securities (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S.  dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
 
A-2
 
 
3.  Paying Agent and Registrar
 
Initially, The Bank of New York (the “Trustee”), will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Securityholder.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.
 
4.  Indenture
 
The Company issued the Securities under an Indenture dated as of October 18, 2004 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), between the Company and the Trustee.  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.  ss.ss.  77aaa-77bbbb) as in effect on the date of the Indenture (the “Act”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement of those terms.  In the event of any inconsistency between the terms of this Security and the terms of the Indenture, the terms of the Indenture shall control.
 
The Securities are general unsecured senior obligations of the Company, including (a)  $300,000,000 aggregate principal amount of Securities being offered on the Issue Date (subject to Section 2.9 of the Indenture) and (b) any Additional Securities.  This Security is one of the Securities referred to in the Indenture.  The Initial Securities, Additional Securities and Exchange Securities will be treated as a single class of securities under the Indenture.  The Indenture imposes certain limitations on, among other things: the incurrence of certain liens and sale-leaseback transactions by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.
 
A-3
 
 
5.  Redemption
 
The Securities will be redeemable, in whole or in part, at any time, at the option of the Company, upon not less than 30 and not more than 60 days prior notice mailed by first-class mail to each Holder of Securities to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of
 
 
o
100% of the principal amount of the Securities to be redeemed; or
 
 
o
the sum of the present values of the remaining scheduled payments of principal of and interest on the Securities to be redeemed, exclusive of interest accrued to the redemption date, discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined below), plus 15 basis points as calculated by an Independent Investment Banker;
 
plus, in either case, accrued and unpaid interest on the principal amount of the Securities to be redeemed to the redemption date.
 
For purposes of determining the optional redemption price, the following definitions are applicable:
 
“Adjusted Treasury Rate” means, with respect to any redemption date for the Securities,
 
 
o
the yield, under the heading that represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the applicable maturity date, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or
 
 
o
if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
 
A-4
 
 
The Adjusted Treasury Rate shall be calculated on the third business day preceding the redemption date.
 
“Comparable Treasury Issue” means the U.S. Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Securities to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Securities.
 
“Comparable Treasury Price” means, with respect to any redemption date (1) the average of five Reference Treasury Dealer Quotations obtained by the Trustee for that redemption date, after excluding the highest and lowest of such reference Treasury Dealer Quotations; or (2) if the Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer Quotations obtained by the Trustee.
 
“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.
 
“Reference Treasury Dealer” means (1) J.P. Morgan Securities Inc., Banc of America Securities LLC, Citigroup Global Markets Inc. (or their successors); provided, however, that if any of the foregoing shall cease to be a primary U.S.  government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer; and (2) any other Primary Treasury Dealer appointed by the Trustee in consultation with the Company.
 
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Securities, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.
 
In the case of any partial redemption, selection of the Securities for redemption will be made by the Trustee not more than 60 days prior to the redemption date and by such method as the Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.  If any Security is to be redeemed in part only, the notice of redemption relating to such Security shall state the portion of the principal amount thereof to be redeemed.  A new Security in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Security.  On and after the redemption date, interest will cease to accrue on Securities or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on such date.
 
 
A-5
 
 
6.  Denominations; Transfer; Exchange
 
The Securities are in registered form without coupons in denominations of principal amount of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not (A) issue, register the transfer of or exchange any Security during a period beginning at the opening of 15 days before the day of any selection of Securities for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 
7.  Persons Deemed Owners
 
The registered Holder of this Security will be treated as the owner of it for all purposes.
 
8.  Unclaimed Money
 
If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.
 
9.  Defeasance
 
Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S.  Government Securities for the payment of principal, premium, if any, and interest on the Securities to redemption or maturity, as the case may be.
 
10.  Amendment, Waiver
 
Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Securities and (ii) any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Securityholder affected) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Securities.  Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee may amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Securities, or to secure the Securities, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder.
 
 
A-6
 
 
11.  Defaults and Remedies
 
Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Security when due, continued for 30 days; (ii) default in the payment of principal or premium, if any, on any Security when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Securities, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice from the Trustee or the Holders of at least 25%  in principal amount of the outstanding Securities; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including the Securities, other than the Securities, , if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of $50,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
If an Event of Default described in clauses (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Securities by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Securities to be due and payable.  Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security satisfactory to it.  Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Security) if it determines in good faith that withholding notice is in the interests of Securityholders.
 
 
A-7
 
 
12.  Trustee Dealings with the Company
 
Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.
 
13.  No Recourse Against Others
 
An incorporator, director, officer, employee, Affiliate or stockholder, of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
 
14.  Authentication
 
This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Security.
 
15.  Abbreviations
 
Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM  (=tenants in common), TEN ENT  (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 
16.  CUSIP Numbers
 
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders.  No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
17.  Governing Law
 
This Security shall be governed by, and construed in accordance with, the laws of the State of New York.
 
 
A-8
 
 
The Company will furnish to any Securityholder upon written request and without charge to the Securityholder a copy of the Indenture which has in it the text of this Security.  Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  Treasurer
 
 
A-9
 
 
ASSIGNMENT FORM
 
To assign this Security, fill in the form below:
 
I or we assign and transfer this Security to
 
___________________________________________
                (Print or type assignee’s name, address and zip code)
 
___________________________________________
                (Insert assignee’s soc. sec. or tax I.D. No.)
 
and irrevocably appoint ___________ agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.
 
Date: ____________________                                                                             Your Signature: ___________________________
 
Signature Guarantee:_________________________________________________________________________________________________
(Signature must be guaranteed)
 
__________________________________________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
In connection with any transfer or exchange of any of the Securities evidenced by this certificate occurring prior to the date that is two years after the later of the date of original issuance of such Securities and the last date, if any, on which such Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that such Securities are being:
 
CHECK ONE BOX BELOW:
 
__ 1
acquired for the undersigned’s own account, without transfer; or
 
__ 2
transferred to the Company; or
 
__ 3
transferred pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”); or
 
__ 4
transferred pursuant to an effective registration statement under the Securities Act; or
 
__ 5
transferred pursuant to and in compliance with Regulation S under the Securities Act; or
 
 
A-10
 
 
__ 6
transferred to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act), that has furnished to the Trustee a signed letter containing certain representations and agreements (the form of which letter appears as Section 2.7 of the Indenture); or
 
__ 7
transferred pursuant to another available exemption from the registration requirements of the Securities Act.
 
Unless one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (5), (6) or (7) is checked, the Trustee or the Company may require, prior to registering any such transfer of the Securities, in their sole discretion, such legal opinions, certifications and other information as the Trustee or the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, such as the exemption provided by Rule 144 under such Act.
 
     
     
   
Signature
     
     
Signature Guarantee:
   
     
     
(Signature must be guaranteed)
 
Signature
     
 
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.
 
The undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A.
 
 
Dated:

 
A-11
 
 
[TO BE ATTACHED TO GLOBAL SECURITIES]
 
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
 
The following increases or decreases in this Global Security have been made:
 
Date of
Exchange
 
Amount of
decrease in
Principal Amount
of this Global
Security
 
Amount of
increase in
Principal Amount
of this Global
Security
 
Principal Amount
of this Global
Security following
such decrease or
increase
 
Signature of
authorized
signatory of
Trustee or
Securities
Custodian
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
 
 
 
A-12

 
EXHIBIT B
 
[FORM OF FACE OF EXCHANGE SECURITY]
 
[Depository Legend, if applicable]
 
 
No. ___
Principal Amount $__________, as revised by the Schedule of Increases and Decreases in Global Security attached hereto
   
 
CUSIP NO. ____________
   
 
           ISIN: ____________

4 3/4% Senior Notes Due 2014
 
The Black & Decker Corporation, a Maryland corporation, promises to pay to ____________, or registered assigns, the principal sum of _______________ Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on November 1, 2014.
 
Interest Payment Dates: May 1 and November 1
 
Record Dates: April 15 and October 15
 
Additional provisions of this Security are set forth on the other side of this Security.
 
 

THE BLACK & DECKER CORPORATION
 
 
By:
 


TRUSTEE’S CERTIFICATE OF
     AUTHENTICATION
     
       
The Bank of New York,
as Trustee, certifies that this
is one of the Securities referred
to in the Indenture.
     
       
By
       
 
Authorized Signatory
 
Date:  October __, 2004
 
 
 
B-1
 
 
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
 
4 3/4% Senior Note Due 2014
 
1.  Interest
 
The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the  “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above.
 
The Company will pay interest semiannually on May 1 and November 1 of each year commencing May 1, 2005.  Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from October 18, 2004. The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Securities to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.
 
2.  Method of Payment
 
By at least 10:00 a.m.  (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Securities at the close of business on the April 15 or October 15 next preceding the interest payment date even if Securities are cancelled, repurchased or redeemed after the record date and on or before the interest payment date.  Holders must surrender Securities to a Paying Agent to collect principal payments.  The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Securities represented by a Global Security  (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company.  Payments in respect of Securities represented by Definitive Securities (including principal, premium, if any, and interest) held by a Holder of at least  $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
 
B-2
 
 
3.  Paying Agent and Registrar
 
Initially, The Bank of New York  (the  “Trustee”), will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Securityholder.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.
 
4.  Indenture
 
The Company issued the Securities under an Indenture dated as of October 18, 2004 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), between the Company and the Trustee.  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.  ss.ss.  77aaa-77bbbb) as in effect on the date of the Indenture  (the  “Act”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement of those terms.  In the event of any inconsistency between the terms of this Security and the terms of the Indenture, the terms of the Indenture shall control.
 
The Securities are general unsecured senior obligations of the Company, including  (a)  $300,000,000 aggregate principal amount of Securities being offered on the Issue Date (subject to Section 2.9 of the Indenture) and (b) any Additional Securities.  The Security is one of the Securities referred to in the Indenture.  The Initial Securities, Additional Securities and Exchange Securities will be treated as a single class of securities under the Indenture.  The Indenture imposes certain limitations on, among other things: the incurrence of certain liens and sale-leaseback transaction by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.
 
5.  Redemption
 
The Securities will be redeemable, in whole or in part, at any time, at the option of the Company, upon not less than 30 and not more than 60 days prior notice mailed by first-class mail to each Holder of Securities to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of
 
 
o
100% of the principal amount of the Securities to be redeemed; or
 
 
o
the sum of the present values of the remaining scheduled payments of principal of and interest on the Securities to be redeemed, exclusive of interest accrued to the redemption date, discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined below), plus 15 basis points as calculated by an Independent Investment Banker;
 
 
B-3
 
 
plus, in either case, accrued and unpaid interest on the principal amount of the Securities to be redeemed to the redemption date.
 
For purposes of determining the optional redemption price, the following definitions are applicable:
 
“Adjusted Treasury Rate” means, with respect to any redemption date for the Securities,
 
 
o
the yield, under the heading that represents the average for the immediately preceding week, appearing in the most recently published statistical release designated  “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption  “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the applicable maturity date, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or
 
 
o
if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
The Adjusted Treasury Rate shall be calculated on the third business day preceding the redemption date.
 
“Comparable Treasury Issue” means the U.S. Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Securities to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Securities.
 
“Comparable Treasury Price” means, with respect to any redemption date (1) the average of five Reference Treasury Dealer Quotations obtained by the Trustee for that redemption date, after excluding the highest and lowest of such reference Treasury Dealer Quotations; or (2) if the Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer Quotations obtained by the Trustee.
 
“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.
 
 
B-4
 
 
“Reference Treasury Dealer” means (1) J.P. Morgan Securities Inc., Banc of America Securities LLC, Citigroup Global Markets Inc. (or their successors); provided, however, that if any of the foregoing shall cease to be a primary U.S. government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer; and (2) any other Primary Treasury Dealer appointed by the Trustee in consultation with the Company.
 
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Securities, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.
 
In the case of any partial redemption, selection of the Securities for redemption will be made by the Trustee not more than 60 days prior to the redemption date and by such method as the Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.  If any Security is to be redeemed in part only, the notice of redemption relating to such Security shall state the portion of the principal amount thereof to be redeemed.  A new Security in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Security.  On and after the redemption date, interest will cease to accrue on Securities or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on such date.
 
6.  Denominations; Transfer; Exchange
 
The Securities are in registered form without coupons in denominations of principal amount of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not (A) issue, register the transfer of or exchange any Security during a period beginning at the opening of 15 days before the day of any selection of Securities for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 
 
B-5
 
 
7.  Persons Deemed Owners
 
The registered Holder of this Security will be treated as the owner of it for all purposes.
 
8.  Unclaimed Money
 
If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.
 
9.  Defeasance
 
Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S.  Government Securities for the payment of principal, premium, if any, and interest on the Securities to redemption or maturity, as the case may be.
 
10.  Amendment, Waiver
 
Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Securities and (ii) any default  (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Securityholder affected) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Securities.  Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee may amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Securities, or to secure the Securities, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder.
 
11.  Defaults and Remedies
 
Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Security when due, continued for 30 days; (ii) default in the payment of principal or premium, if any, on any Security when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Securities, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice from the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt  (including the Securities, other than the Securities, if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses  (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $50,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of  $50,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or  (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
 
B-6
 
 
If an Event of Default described in clauses  (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Securities by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Securities to be due and payable.  Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security.  Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any continuing Default or Event of Default  (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Security) if it determines in good faith that withholding notice is in the interests of Securityholders.
 
12.  Trustee Dealings with the Company
 
Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.
 
13.  No Recourse Against Others
 
An incorporator, director, officer, employee, Affiliate or stockholder of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
 
 
B-7
 
 
14.  Authentication
 
This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Security.
 
15.  Abbreviations
 
Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM  (=tenants in common), TEN ENT  (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 
16.  CUSIP Numbers
 
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders.  No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
                17.  Governing Law
 
This Security shall be governed by, and construed in accordance with, the laws of the State of New York without giving effect to conflicts of laws principles thereof.
 
The Company will furnish to any Securityholder upon written request and without charge to the Securityholder a copy of the Indenture which has in it the text of this Security.  Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  Treasurer
 
 
B-8
 
 
ASSIGNMENT FORM
 
To assign this Security, fill in the form below:
 
I or we assign and transfer this Security to
 
___________________________________________
                (Print or type assignee’s name, address and zip code)
 
___________________________________________
                (Insert assignee’s soc. sec. or tax I.D. No.)
 
and irrevocably appoint ___________ agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.
 
__________________________________________________________________________________________________________________
 
Date: ____________________                                                                             Your Signature: ___________________________
 
Signature Guarantee:_________________________________________________________________________________________________
(Signature must be guaranteed)
 
__________________________________________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
 
B-9
 
 
[TO BE ATTACHED TO GLOBAL SECURITIES]
 
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
 
The following increases or decreases in this Global Security have been made:
 
Date of
Exchange
 
Amount of
decrease in
Principal Amount
of this Global
Security
 
Amount of
increase in
Principal Amount
of this Global
Security
 
Principal Amount
of this Global
Security following
such decrease or
increase
 
Signature of
authorized
signatory of
Trustee or
Securities
Custodian
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
 
 
 
 
B-10
Exhibit 4.8
 
 
 
 
THE BLACK & DECKER CORPORATION
 
 
AND
 
 
THE BANK OF NEW YORK,
 
 
AS TRUSTEE
 
 
7.125% Senior Notes Due 2011
 
 
INDENTURE
 
 
Dated as of June 5, 2001
 
 

 
 
 

TABLE OF CONTENTS
 
 
  Page
 
 
ARTICLE I
Definitions and Incorporation by Reference
     
SECTION 1.1.
Definitions
1
SECTION 1.2.
Other Definitions
5
SECTION 1.3.
Incorporation by Reference of Trust Indenture Act
6
SECTION 1.4.
Rules of Construction
6
     
ARTICLE II
The Securities
     
SECTION 2.1.
Form, Dating and Terms
7
SECTION 2.2.
Execution and Authentication
15
SECTION 2.3.
Registrar and Paying Agent
17
SECTION 2.4.
Paying Agent To Hold Money in Trust
17
SECTION 2.5.
Securityholder Lists
18
SECTION 2.6.
Transfer and Exchange
18
SECTION 2.7.
Form of Certificate to be Delivered in Connection with Transfers to Institutional Accredited Investors
21
SECTION 2.8.
Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S
23
SECTION 2.9.
Mutilated, Destroyed, Lost or Stolen Securities
24
SECTION 2.10.
Outstanding Securities
25
SECTION 2.11.
Temporary Securities
25
SECTION 2.12.
Cancellation
26
SECTION 2.13.
Payment of Interest; Defaulted Interest
26
SECTION 2.14.
Computation of Interest
27
SECTION 2.15.
CUSIP and ISIN Numbers
27
     
ARTICLE III
Covenants
     
SECTION 3.1.
Payment of Securities
27
SECTION 3.2.
Limitation on Liens
28
SECTION 3.3.
Limitation on Sale Leaseback Transactions
29
SECTION 3.4.
Maintenance of Office or Agency
29
SECTION 3.5.
Compliance Certificate
30
SECTION 3.6.
Statement by Officers as to Default
30
SECTION 3.7.
Further Instruments and Acts
30
 
 
i
 
 
     
ARTICLE IV
Successor Company
     
SECTION 4.1.
Merger, Consolidation or Sale of All or Substantially All Assets of the Company
30
     
ARTICLE V
Redemption of Securities
     
SECTION 5.1.
Optional Redemption
31
SECTION 5.2.
Applicability of Article
31
SECTION 5.3.
Election to Redeem; Notice to Trustee
31
SECTION 5.4.
Selection by Trustee of Securities to Be Redeemed
31
SECTION 5.5.
Notice of Redemption
32
SECTION 5.6.
Deposit of Redemption Price
33
SECTION 5.7.
Securities Payable on Redemption Date
33
SECTION 5.8.
Securities Redeemed in Part
33
     
ARTICLE VI
Defaults and Remedies
     
SECTION 6.1.
Events of Default
33
SECTION 6.2.
Acceleration
35
SECTION 6.3.
Other Remedies
35
SECTION 6.4.
Waiver of Past Defaults
35
SECTION 6.5.
Control by Majority
36
SECTION 6.6.
Limitation on Suits
36
SECTION 6.7.
Rights of Holders to Receive Payment
36
SECTION 6.8.
Collection Suit by Trustee
36
SECTION 6.9.
Trustee May File Proofs of Claim
37
SECTION 6.10.
Priorities
37
SECTION 6.11.
Undertaking for Costs
37
     
ARTICLE VII
Trustee
     
SECTION 7.1.
Duties of Trustee
37
SECTION 7.2.
Rights of Trustee
39
SECTION 7.3.
Individual Rights of Trustee
40
SECTION 7.4.
Trustee’s Disclaimer
40
SECTION 7.5.
Notice of Defaults
40
SECTION 7.6.
Reports by Trustee to Holders
40
 
 
ii
 
 
SECTION 7.7.
Compensation and Indemnity
41
SECTION 7.8.
Replacement of Trustee
42
SECTION 7.9.
Successor Trustee by Merger
42
SECTION 7.10.
Eligibility; Disqualification
43
SECTION 7.11.
Preferential Collection of Claims Against Company
43
     
ARTICLE VIII
Satisfaction and Discharge of Indenture
     
SECTION 8.1.
Option To Effect Legal Defeasance or Covenant Defeasance
43
SECTION 8.2.
Legal Defeasance and Discharge
43
SECTION 8.3.
Covenant Defeasance
44
SECTION 8.4.
Conditions to Legal or Covenant Defeasance
44
SECTION 8.5.
Satisfaction and Discharge of Indenture
46
SECTION 8.6.
Survival of Certain Obligations
46
SECTION 8.7.
Acknowledgment of Discharge by Trustee
46
SECTION 8.8.
Application of Trust Moneys
47
SECTION 8.9.
Repayment to the Company; Unclaimed Money
47
SECTION 8.10.
Reinstatement
47
     
ARTICLE IX
Amendments
     
SECTION 9.1.
Without Consent of Holders
48
SECTION 9.2.
With Consent of Holders
48
SECTION 9.3.
Compliance with Trust Indenture Act
49
SECTION 9.4.
Revocation and Effect of Consents and Waivers
49
SECTION 9.5.
Notation on or Exchange of Securities
50
SECTION 9.6.
Trustee To Sign Amendments
50
     
ARTICLE X
Miscellaneous
     
SECTION 10.1.
Trust Indenture Act Controls
50
SECTION 10.2.
Notices
50
SECTION 10.3.
Communication by Holders with other Holders
51
SECTION 10.4.
Certificate and Opinion as to Conditions Precedent
51
SECTION 10.5.
Statements Required in Certificate or Opinion
51
SECTION 10.6.
When Securities Disregarded
52
SECTION 10.7.
Rules by Trustee, Paying Agent and Registrar
52
SECTION 10.8.
Legal Holidays
52
SECTION 10.9.
GOVERNING LAW
52
SECTION 10.10.
No Recourse Against Others
52
SECTION 10.11.
Successors
53
 
 
iii
 
 
SECTION 10.12.
Multiple Originals
53
SECTION 10.13.
Variable Provisions
53
SECTION 10.14.
Table of Contents; Headings
53
 
 
EXHIBIT A  Form of the Initial Security
EXHIBIT B Form of the Exchange Security
 
                     

 
iv
 

CROSS-REFERENCE TABLE
 
TIA
Section
Indenture Section
310(a)(1)
7.10
(a)(2)
7.10
(a)(3)
N.A.
(a)(4)
N.A.
(b)
7.8; 7.10
(c)
N.A.
311(a)
7.11
(b)
7.11
(c)
N.A.
312(a)
2.5
(b)
0.3
(c)
0.3
313(a)
7.6
(b)(1)
N.A.
(b)(2)
7.6
(c)
7.6
(d)
7.6
314(a)
3.5; 10.2; 10.5
(b)
N.A.
(c)(1)
10.4
(c)(2)
10.4
(c)(3)
N.A.
(d)
N.A.
(e)
10.5
315(a)
7.1
(b)
7.5; 10.2
(c)
7.1
(d)
7.1
(e)
6.11
316(a)(last sentence)
10.6
(a)(1)(A)
6.5
(a)(1)(B)
6.4
(a)(2)
N.A.
(b)
6.7
317(a)(1)
6.8
(a)(2)
6.9
(b)
2.4
318(a)
10.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.
 
 
 
v
 
 
 
INDENTURE dated as of June 5, 2001, between THE BLACK & DECKER CORPORATION, a Maryland corporation, and THE BANK OF NEW YORK, a New York banking corporation, as Trustee.
 
Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of (i) the Company’s 7.125% Senior Notes Due 2011 issued on the date hereof (the “ Initial Securities ”), (ii) if and when issued, additional 7.125% Senior Notes Due 2011 that may be offered from time to time subsequent to the Issue Date (the “ Additional Securities ”), and (iii) if and when issued pursuant to a Registered Exchange Offer from time to time for Initial Securities or any Additional Securities as provided in an Exchange and Registration Rights Agreement, the Company’s 7.125% Senior Notes Due 2011 (the “ Exchange Securities ”).
 
ARTICLE I
 
Definitions and Incorporation by Reference
 
SECTION 1.1. Definitions.
 
“ Additional Securities ” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“ Attributable Debt ” for a lease means the carrying value of the capitalized rental obligation determined under generally accepted accounting principles whether or not such obligation is required to be shown on the balance sheet as a long-term liability. The carrying value may be reduced by the capitalized value of the rental obligations, calculated on the same basis, that any sublessee has for all or part of the same property.
 
“ Board of Directors ” means, as to any Person, the board of directors of such Person or any duly authorized committee thereof.
 
“ Board Resolution ” means, with respect to any Person, a resolution of the Board of Directors or of a committee or person to which or to whom the Board of Directors has properly delegated the appropriate authority, a copy of which has been certified by the Secretary or an Assistant Secretary of the Person to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivered to the Trustee.
 
“ Business Day ” means a day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in New York City.
 
“ Company ” means The Black & Decker Corporation or its successor.
 
“ Consolidated Net Tangible Assets ” means total assets less (1) total current liabilities (excluding any Debt which, at the option of the borrower, is renewable or extendible to a term exceeding 12 months and which is included in current liabilities and further excluding any deferred income taxes which are included in current liabilities) and (2) goodwill, patents, trademarks and other like intangibles, all as stated on the Company’s most recent quarter-end consolidated balance sheet preceding the date of determination.
 

 
 
 
 
 
“ Debt ” means any debt for borrowed money (including the Securities), capitalized lease obligations and purchase money obligations, or any guarantee of such debt, in any such case that would appear on the consolidated balance sheet of the Company as a liability.
 
“ Default ” means any event which is, or after notice or passage of time or both would be, an Event of Default.
 
“ Definitive Securities ” means certificated Securities.
 
“ DTC ” means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depository institution hereinafter appointed by the Company.
 
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
 
“ Exchange and Registration Rights Agreement ” means (i) the Exchange and Registration Rights Agreement dated the Issue Date among the initial purchasers named therein and the Company, as the same may be amended, supplemented or modified from time to time and (ii) any similar exchange and/or registration rights agreement entered into with respect to any Additional Securities, as any such agreement may be amended, supplemented or modified from time to time.
 
“ Exchange Securities ” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“ Exempted Debt ” means the sum, without duplication, of the following items outstanding as of the date Exempted Date is being determined: (i) Debt incurred after the date of the Indenture and secured by liens created or assumed or permitted to exist pursuant to paragraph (b) of Section 3.2 and (ii) Attributable Debt of the Company and its Subsidiaries in respect of all sale and lease-back transactions with regard to any Principal Property entered into pursuant to paragraph (b) of Section 3.3.
 
“ Fiscal Year ” means the fiscal year of the Company.
 
“ Funded Debt ” means all Debt having a maturity of more than one year from the date of its creation or having a maturity of less than one year but by its terms being renewable or extendible, at the option of the obligor in respect thereof, beyond one year from its creation.
 
“ Holder ” or “ Securityholder ” means the Person in whose name a Security is registered in the Note Register.
 

 
2
 

“ Indenture ” means this Indenture, as amended or supplemented from time to time.
 
“ Initial Securities ” has the meaning ascribed to it in the second introductory paragraph of this Indenture.
 
“ Issue Date ” means the date on which the Initial Securities are originally issued.
 
“ Legal Holiday ” has the meaning ascribed to it in Section 10.8 .
 
“ Non-U.S. Person ” means a person who is not a U.S. person, as defined in Regulation S.
 
“ Note Register ” means the register of Securities, maintained by the Registrar, pursuant to Section 2.3 .
 
“ Officer ” means the Chairman of the Board, any Vice Chairman of the Board, the President, the Chief Financial Officer, any Senior Vice President, any Vice President, the Treasurer or the Secretary of the Company.
 
“ Officers’ Certificate ” means a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company.
 
“ Opinion of Counsel ” means a written opinion (subject to customary assumptions, qualifications and exceptions) from legal counsel who is reasonably acceptable to the Trustee. Unless otherwise required by the TIA, the counsel may be an employee of or counsel to the Company.
 
“ Person ” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company, government or any agency or political subdivision hereof or any other entity.
 
“ principal ” of any Debt (including the Securities) means the principal amount of such Debt plus the premium, if any, on such Debt.
 
“ Principal Property ” means land, land improvements, buildings and associated factory and laboratory equipment owned or leased pursuant to a capital lease and used by the Company or any Subsidiary primarily for manufacturing, assembling, processing, producing, packaging or storing its products, raw materials, inventories or other materials and supplies located in the United States and having an acquisition cost plus capitalized improvements in excess of 2% of Consolidated Net Tangible Assets as of the date of determination, but shall not include any such property financed through the issuance of tax exempt governmental obligations, or any such property that has been determined by Board Resolution of the Company not to be of material importance to the respective businesses conducted by the Company and its Subsidiaries taken as a whole, effective as of the date such resolution is adopted.
 

 
3
 
 
 
“ QIB ” means any “ qualified institutional buyer ” (as defined in Rule 144A).
 
“ Redemption Date ” means, with respect to any redemption of Securities, the date of redemption with respect thereto.
 
“ Registered Exchange Offer ” means the offer which may be made by the Company pursuant to an Exchange and Registration Rights Agreement to exchange Initial Securities or Additional Securities for Exchange Securities.
 
“ Regulation S ” means Regulation S under the Securities Act.
 
“ Restricted Period ” means the 40 consecutive days beginning on and including the later of (1) the day on which the Initial Securities are offered to persons other than distributors (as defined in Regulation S under the Securities Act) and (2) the Issue Date.
 
“ Restricted Securities Legend ” means the Private Placement Legend set forth in clause (1) of Section 2.1(c) or the Regulation S Legend set forth in clause (2) of Section 2.1(c) , as applicable.
 
“ Rule 144A ” means Rule 144A under the Securities Act.
 
“ SEC ” means the Securities and Exchange Commission.
 
“ Securities ” means the collective reference to the Initial Securities, Additional Securities, and Exchange Securities.
 
“ Securities Act ” means the Securities Act of 1933, as amended.
 
“ Securities Custodian ” means the custodian with respect to the Global Security (as appointed by DTC), or any successor Person thereto and shall initially be the Trustee.
 
“ Stated Maturity ” means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but shall not include any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.
 
“ Subsidiary ” means any corporation, limited liability company or other business entity of which more than 50% of the total voting power of the equity interests entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof or any partnership of which more than 50% of the partners’ equity interests (considering all partners’ equity interests as a single class) is, in each case, at the time owned or controlled, directly or indirectly, by the Company, one or more of the Subsidiaries of the Company, or combination thereof.
 

 
4
 

 
“ TIA ” or “ Trust Indenture Act ” means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb), as in effect on the date of this Indenture.
 
“ Trustee ” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.
 
“ Trust Officer ” shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.
 
“ U.S. GAAP ” means generally accepted accounting principles in the United States as have been approved by a significant segment of the U.S. accounting profession, which are in effect at the time of each application for purposes of determining compliance with Articles III and IV. For the purposes of this Indenture, the term “consolidated” with respect to any Person shall mean such Person consolidated with its Subsidiaries.
 
“ U.S. Government Securities ” means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S. Government Securities or a specific payment of principal of or interest on any such U.S. Government Securities held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Securities or the specific payment of principal of or interest on the U.S. Government Securities evidenced by such depository receipt.
 
SECTION 1.2. Other Definitions.
 
Term
 
Defined in Section
“Agent Member”
 
2.1(d)
“Authenticating Agent”
 
2.2
“Bankruptcy Law”
 
6.1
“Company Order”
 
2.2
“Corporate Trust Office”
 
3.4
“Covenant Defeasance”
 
8.3
 
 
5
 
 
 
Term    Defined in Section
“Custodian”
 
6.1
“Defaulted Interest”
 
2.13
“Event of Default”
 
6.1
“Exchange Global Note”
 
2.1(a)
“Global Securities”
 
2.1(a)
“IAI”
 
2.1(a)
“Institutional Accredited Investor Global Note”
 
2.1(a)
“Legal Defeasance”
 
8.2
“Paying Agent”
 
2.3
“Private Placement Legend”
 
2.1(c)
“Registrar”
 
2.3
“Regulation S Global Note”
 
2.1(a)
“Regulation S Legend”
 
2.1(c)
“Resale Restriction Termination Date”
 
2.6
“Rule 144A Global Note”
 
2.1(a)
“Special Interest Payment Date”
 
2.13
“Special Record Date”
 
2.13
“Successor Company”
 
4.1

                      SECTION 1.3. Incorporation by Reference of Trust Indenture Act.   This Indenture is subject to the mandatory provisions of the TIA which are incorporated by reference in and made a part of this Indenture. The following TIA terms have the following meanings:
 
“Commission” means the SEC.
 
“indenture securities” means the Securities.
 
“indenture security holder” means a Securityholder.
 
“indenture to be qualified” means this Indenture.
 
“indenture trustee” or “institutional trustee” means the Trustee.
 
“obligor” on the indenture securities means the Company and any other obligor on the indenture securities.
 
All other TIA terms used in this Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.
 
 
6
 
 
SECTION 1.4. Rules of Construction.   Unless the context otherwise requires: a term has the meaning assigned to it; an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;
 
(1)  “or” is not exclusive;
 
(2)  “including” means including without limitation; words in the singular include the plural and words in the plural include the singular; and (6)  the principal amount of any non interest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with U.S. GAAP.
 
ARTICLE II
 
The Securities
 
SECTION 2.1. Form, Dating and Terms.   (a)  The Initial Securities and the Additional Securities shall be in substantially the form set forth in Exhibit A hereto, which is hereby incorporated by reference and made a part of this Indenture, and the Exchange Securities shall be in substantially the form set forth in Exhibit B hereto, which is hereby incorporated by reference and made a part of this Indenture.
 
Initial Securities and Additional Securities offered and sold to QIBs in the United States of America in reliance on Rule 144A will be issued initially in the form of a permanent global Security, including appropriate legends as set forth in Section 2.1(c) below (a “ Rule 144A Global Note ”), deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided. A Rule 144A Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of a Rule 144A Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 
Initial Securities and Additional Securities offered, sold and resold outside the United States of America to Persons other than U.S. Persons (as defined in Regulation S) in reliance on Regulation S will be issued initially in the form of a permanent global Security, including appropriate legends as set forth in Section 2.1(c) below (the “ Regulation S Global Note ”), deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided. A Regulation S Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of a Regulation S Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 
Initial Securities or Additional Securities resold after an initial resale thereof to QIBs in reliance on Rule 144A or an initial resale thereof in reliance on Regulation S to institutional “accredited investors” (as defined in Rules 501(a)(1), (2), (3) or (7) under the Securities Act) who are not QIBs (“ IAIs ”) in the United States of America in accordance with the procedure described herein will be initially issued in the form of a permanent global Security (an “ Institutional Accredited Investor Global Note ”) deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided. An Institutional Accredited Investor Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of an Institutional Accredited Investor Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.
 

 
7
 
 
 
Exchange Securities exchanged for interests in a Rule 144A Global Note, a Regulation S Global Note or an Institutional Accredited Investor Note will be issued initially in the form of a permanent global Security, deposited with the Trustee as hereinafter provided, including the appropriate legend set forth in Section 2.1(c) below (an “ Exchange Global Note ”). An Exchange Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.
 
The Rule 144A Global Notes, the Regulation S Global Notes, the Institutional Investor Global Notes and the Exchange Global Notes are sometimes collectively herein referred to as the “ Global Securities .”
 
Except as described in the succeeding two sentences, the principal of and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3 ; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register. Payments in respect of Securities represented by a Global Security (including principal and interest) will be made by wire transfer of immediately available funds to the accounts specified by DTC. Payments in respect of Securities represented by Definitive Securities (including principal and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage, in addition to those set forth in Section 2.1(c) below. The Company and the Trustee shall approve the forms of the Securities and any notation, endorsement or legend on them. Each Security shall be dated the date of its authentication. The terms of the Securities set forth in Exhibit A and Exhibit B are part of the terms of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to be bound by such terms.
 
(b)   Denominations. The Securities shall be issuable only in fully registered form, without coupons, and only in denominations of $1,000 and any integral multiple thereof.
 

 
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(c)   Restrictive Legends. The following legends shall appear on the face of all Global Securities and Definitive Securities issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture:
 
(i)  Each Rule 144A Global Note and Institutional Accredited Investor Global Note shall bear the following legend (the “ Private Placement Legend ”) on the face thereof:
 
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION.
 
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.  THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES, ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATIONS UNDER THE SECURITIES ACT, PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRANSFEROR FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS RELATING TO THE PROPOSED TRANSFER BEING EFFECTED PURSUANT TO AND IN ACCORDANCE WITH REGULATION S (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), (E) INSIDE THE UNITED STATES, TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT AND THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”
 

 
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(ii)  Each Regulation S Global Note shall bear the following legend (the “ Regulation S Legend ”) on the face thereof:
 
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION.
 
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
 
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES, ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRANSFEROR FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS RELATING TO THE PROPOSED TRANSFER BEING EFFECTED PURSUANT TO AND IN ACCORDANCE WITH REGULATION S (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), (E) INSIDE THE UNITED STATES, TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a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’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”
 

 
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(iii)  Each Regulation S Global Note shall bear the following legend (the “Regulation S Legend”) on the face thereof:
 
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS NOT A U.S. PERSON NOR IS IT PURCHASING FOR THE ACCOUNT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (“REGULATION S”), AND (2) BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”)  THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE  LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S, PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRANSFEROR FURNISHES TO THE COMPANY AND THE TRUSTEE A CERTIFICATE CONTAINING CERTAIN REPRESENTATIONS RELATING TO THE PROPOSED TRANSFER BEING EFFECTED PURSUANT TO AND IN ACCORDANCE WITH REGULATION S (THE FORM OF WHICH CERTIFICATE CAN BE OBTAINED FROM THE TRUSTEE), (E) INSIDE THE UNITED STATES, TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a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’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED AFTER 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A) THE DAY ON WHICH THE SECURITIES ARE OFFERED TO PERSONS OTHER THAN DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE DATE OF THE CLOSING OF THE ORIGINAL OFFERING. AS USED HEREIN, THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.”
 

 
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(iv)  The Global Securities shall bear the following legend on the face thereof:
 
“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.  OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
 
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.”
 
(d)   Book-Entry Provisions.   (i)  This Section 2.1(d) shall apply only to Global Securities  deposited with the Trustee, as custodian for DTC.
 
(ii)  Each Global Security initially shall (x) be registered in the name of DTC or the nominee of DTC, (y) be delivered to the Trustee as custodian for DTC and (z) bear legends as set forth in Section 2.1(c) .
 
(iii)  Members of, or participants in, DTC (“ Agent Members ”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by DTC or by the Trustee as the custodian of DTC or under such Global Security, and DTC may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as between DTC and its Agent Members, the operation of customary practices of DTC governing the exercise of the rights of a Holder of a beneficial interest in any Global Security.
 
(iv)  In connection with any transfer of a portion of the beneficial interest in a Global Security pursuant to subsection (e) of this Section to beneficial owners who are required to hold Definitive Securities, the Securities Custodian shall reflect on its books and records the date and a decrease in the principal amount of such Global Security in an amount equal to the principal amount of the beneficial interest in the Global Security to be transferred, and the Company shall execute, and the Trustee shall authenticate and deliver, one or more Definitive Securities of like tenor and amount.
 
(v)  In connection with the transfer of an entire Global Security to beneficial owners pursuant to subsection (e) of this Section, such Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by DTC in exchange for its beneficial interest in such Global Security, an equal aggregate principal amount of Definitive Securities of authorized denominations.
 
(vi)  The registered Holder of a Global Security may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.
 
 
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(e)   Definitive Securities.   (i)  Except as provided below, owners of beneficial interests in Global Securities will not be entitled to receive Definitive Securities.  If required to do so pursuant to any applicable law or regulation,  beneficial owners may obtain Definitive Securities in exchange for their  beneficial interests in a Global Security upon written request in  accordance with DTC’s and the Registrar’s procedures.  In addition,  Definitive Securities shall be transferred to all beneficial owners in  exchange for their beneficial interests in a Global Security if (a) DTC  notifies the Company that it is unwilling or unable to continue as  depositary for such Global Security or DTC ceases to be a clearing agency registered under the Exchange Act, at a time when DTC is required to be so registered in order to act as depositary, and in each case a successor  depositary is not appointed by the Company within 90 days of such notice, (b) the Company executes and delivers to the Trustee and Registrar an Officers’ Certificate stating that such Global Security shall be so exchangeable or (c) an Event of Default has occurred and is continuing and the Registrar has received a request from DTC.
 
(ii)  Any Definitive Security delivered in exchange for an interest in a Global Security pursuant to Section 2.1(d)(iv) or (v) shall, except as otherwise provided by Section 2.6(c) , bear the applicable legend regarding transfer restrictions applicable to the Definitive Security set forth in Section 2.1(c) .
 
(iii)  In connection with the exchange of a portion of a  Definitive Security for a beneficial interest in a Global Security, the Trustee shall cancel such Definitive Security, and the Company shall execute, and the Trustee shall authenticate and deliver, to the transferring Holder a new Definitive Security representing the principal amount not so transferred.
 
SECTION 2.2. Execution and Authentication.   One Officer shall sign the Securities for the Company by manual or facsimile signature. If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.
 
A Security shall not be valid until an authorized signatory of the Trustee manually authenticates the Security. The signature of the Trustee on a Security shall be conclusive evidence that such Security has been duly and validly authenticated and issued under this Indenture. A Security shall be dated the date of its authentication.
 
 
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At any time and from time to time after the execution and delivery of this Indenture, the Trustee shall authenticate and make available for delivery: Initial Securities for original issue on the Issue Date initially in an aggregate principal amount of $400,000,000, (2) if and when issued, the Additional Securities and (3) Exchange Securities for issue pursuant to an Exchange and Registration Rights Agreement in exchange for Initial Securities or Additional Securities of an equal principal amount, in each case upon a written order of the Company signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company (the “ Company Order ”). Such Company Order shall specify the amount of the Securities to be authenticated and the date on which the original issue of such Securities is to be authenticated and whether the Securities are to be Initial Securities, Additional Securities, or Exchange Securities. The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is limited to $400,000,000 principal amount of Initial Securities and such additional principal amount of Additional Securities as may be authorized from time to time by resolution adopted by the Company’s Board of Directors, except for Securities authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Securities pursuant to Section 2.6 , Section 2.9 , Section 2.11 , Section 5.8 , Section 9.5 and except for Exchange Securities. All Securities issued on the Issue Date and all Additional Securities shall be identical in all respects other than issue dates, the date from which interest accrues and any changes relating thereto. Notwithstanding anything to the contrary contained in this Indenture, the Holders of all Securities issued under this Indenture shall vote and consent together on all matters as one lass, and the Holders of any Initial Securities, Additional Securities or Exchange Securities will not have the right to vote or consent as a separate class on any matter.
 
The Trustee may appoint an agent (the “ Authenticating Agent ”) reasonably acceptable to the Company to authenticate the Securities. Unless limited by the terms of such appointment, any such Authenticating Agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent. An Authenticating Agent has the same rights as a Paying Agent to deal with Holders or an Affiliate of the Company.
 
In case the Company, pursuant to Article IV , shall be consolidated or merged with or into any other Person or shall convey, transfer, lease or otherwise dispose of its properties and assets substantially as an entirety to any Person, and the successor Person resulting from such consolidation, or surviving such merger, or into which the Company shall have been merged, or the Person which shall have received a conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenture supplemental hereto with the Trustee pursuant to Article IV , any of the Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer, lease or other disposition may, from time to time, at the request of the successor Person, be exchanged for other Securities executed in the name of the successor Person with such changes in phraseology and form as may be appropriate, but otherwise in substance of like tenor as the Securities surrendered for such exchange and of like principal amount; and the Trustee, upon Company Order of the successor Person, shall authenticate and deliver Securities as specified in such order for the purpose of such exchange. If Securities shall at any time be authenticated and delivered in any new name of a successor Person pursuant to this Section 2.2 in exchange or substitution for or upon registration of transfer of any Securities, such successor Person, at the option of the Holders but without expense to them, shall provide for the exchange of all Securities at the time outstanding for Securities authenticated and delivered in such new name.
 

 
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SECTION 2.3. Registrar and Paying Agent.   The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Securities may be presented for payment (the “Paying Agent”). The Company shall cause each of the Registrar and the Paying Agent to maintain an office or agency in the Borough of Manhattan, The City of New York. The Registrar shall keep a register of the Securities and of their transfer and exchange (the “Note Register”). The Company may have one or more co-registrars and one or more additional paying agents. The term “Paying Agent” includes any additional paying agent.
 
The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent or co-registrar not a party to this Indenture, which shall incorporate the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to such agent. The Company shall notify the Trustee of the name and address of each such agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7 . The Company or any of its Subsidiaries may act as Paying Agent, Registrar, co-registrar or transfer agent.
 
The Company initially appoints DTC to act as depository with respect to the Global Securities. The Trustee is authorized to enter into a letter of representations with DTC in the form provided to the Trustee by the Company and to act in accordance with such letter.
 
The Company initially appoints the Trustee as Registrar and Paying Agent for the Securities.
 
SECTION 2.4. Paying Agent To Hold Money in Trust.   By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal or interest when due. The Company shall require each Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for the benefit of Securityholders or the Trustee all money held by such Paying Agent for the payment of principal of or interest on the Securities and shall notify the Trustee in writing of any default by the Company in making any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee and to account for any funds disbursed by such Paying Agent. Upon complying with this Section, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money delivered to the Trustee. Upon any bankruptcy, reorganization or similar proceeding with respect to the Company, the Trustee shall serve as Paying Agent for the Securities.
 

 
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SECTION 2.5. Securityholder Lists.   The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders and shall otherwise comply with TIA (S) 312(a). If the Trustee is not the Registrar, or to the extent otherwise required under the TIA, the Company shall furnish to the Trustee, in writing at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders and the Company shall otherwise comply with TIA (S)312(a).
 
SECTION 2.6. Transfer and Exchange.   (a)  The following provisions shall apply with respect to any proposed transfer of a beneficial interest in a Rule 144A Global Note or in an Institutional Accredited Investor Global Note or any Definitive Security issued in exchange therefor prior to the date which is two years after the later of the date of its original issue and the last date on which the Company or any Affiliate of the Company was the owner of such Securities (or any predecessor thereto) (the “Resale Restriction Termination Date”):
 
(i)  a transfer thereof to a QIB in reliance on Rule 144A shall be made upon the representation of the transferee in the form as set forth on the reverse of the Security that it is purchasing for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the proposed transferee has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;
 
(ii)  a transfer thereof to an IAI shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.7 from the proposed transferee and, if requested by the Company or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each of them; and
 
(iii)  a transfer thereof to a Non-U.S. Person in reliance on Regulation S shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.8 from the proposed transferee and, if requested by the Company or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each of them.
 
 
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(b)  The following provisions shall apply with respect to any proposed transfer of a beneficial interest in a Regulation S Global Note or any Definitive Securities issued in exchange therefor prior to the expiration of the Restricted Period:
 
(i)  a transfer thereof to a QIB in reliance on Rule 144A shall be made upon the representation of the transferee, in the form of assignment set forth on the reverse of the Securities, that it is purchasing the Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the proposed transferee has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;
 
(ii)  a transfer thereof to an IAI shall be made upon receipt by the Trustee or its agent of a certificate substantially in the form set forth in Section 2.7 from the proposed transferee and, if requested by the  Company or the Trustee, the delivery of an opinion of counsel,  certification and/or other information satisfactory to each of them; and a transfer thereof to a Non-U.S. Person in reliance on  Regulation S shall be made upon receipt by the Trustee or its agent of a  certificate substantially in the form set forth in Section 2.8 hereof from the proposed transferee and, if requested by the Company or the Trustee, receipt by the Trustee or its agent of an opinion of counsel, certification and/or other information satisfactory to each of them.
 
After the expiration of the Restricted Period, beneficial interests in the Regulation S Global Note or Definitive Securities issued in exchange therefor may be transferred without requiring the certification set forth in Section 2.7 or Section 2.8 or any additional certification.
 
(c)   Restricted Securities Legend.   Upon the transfer, exchange or replacement of Securities not bearing a Restricted Securities Legend, the Registrar shall deliver Securities that do not bear a Restricted Securities Legend. Upon the transfer, exchange or replacement of Securities bearing a Restricted Securities Legend, the Registrar shall deliver only Securities that bear a Restricted Securities Legend unless such Securities are Exchange Securities issued in a Registered Exchange Offer or are otherwise sold under an effective registration statement under the Securities Act or there is delivered to the Registrar an Opinion of Counsel to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act.
 
(d)  The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.1 or this Section 2.6 . The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable prior written notice to the Registrar.
 

 
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(e)   Obligations with Respect to Transfers and Exchanges of Securities.   (i)  To permit registrations of transfers and exchanges, the  Company shall, subject to the other terms and conditions of this Article II , execute, and the Trustee shall authenticate, Definitive Securities and Global Securities at the Registrar’s or co-registrar’s request.
 
(ii)  No service charge shall be made to a Holder for any registration of transfer or exchange, but the Company may require from a Holder payment of a sum sufficient to cover any transfer tax, assessments or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant to Section 9.5 ).
 
(iii)  The Registrar or co-registrar shall not be required (A) to issue, to register the transfer of or to exchange any Security during a period beginning at the opening of 15 days before the day of any selection of Securities for redemption and ending at the close of business on the day of selection, (B) to register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) to register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 
(iv)  Prior to the due presentation for registration of transfer of any Security, the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar may deem and treat the person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar shall be affected by notice to the contrary.
 
(v)  Any Definitive Security delivered in exchange for an  interest in a Global Security pursuant to Section 2.1(d) shall, except as  otherwise provided by Section 2.6(c) , bear the applicable legend regarding transfer restrictions applicable to the Definitive Security set forth in Section 2.1(c) .
 
(vi)  All Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Securities surrendered upon such transfer or exchange.
 
(f)   No Obligation of the Trustee.   (i)  The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in, DTC or other Person with respect to the accuracy of the records of DTC or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than DTC) of any notice (including any notice of redemption) or the payment of any amount or delivery of any Securities (or other security or property) under or with respect to such Securities. All notices and communications to be given to the Holders and all payments to be made to Holders in respect of the Securities shall be given or made only to or upon the order of the registered Holders (which shall be DTC or its nominee in the case of a Global Security). The rights of beneficial owners in any Global Security shall be exercised only through DTC subject to the applicable rules and procedures of DTC. The Trustee may rely and shall be fully protected in relying upon information furnished by DTC with respect to its members, participants and any beneficial owners.
 

 
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(ii)  The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among DTC participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
 
SECTION 2.7. Form of Certificate to be Delivered in Connection with Transfers to Institutional Accredited Investors.
 
[Date]
 
The Black & Decker Corporation
c/o The Bank of New York
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
 
Ladies and Gentlemen:
 
This certificate is delivered to request a transfer of $_________ principal amount of the 7.125% Senior Notes Due 2011 (the “Notes”) of The Black & Decker Corporation (the “Company”).
 

 
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Upon transfer, the Notes would be registered in the name of the new beneficial owner as follows:
 
Name: ___________________________________
 
Address: ________________________________
 
Taxpayer ID Number: _____________________
 
The undersigned represents and warrants to you that:
 
1.  We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the “ Securities Act ”)) purchasing for our own account or for the account of such an institutional “accredited investor” at least $250,000 principal amount of the Notes, and we are acquiring the Notes not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act.  We have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risk of our investment in the Notes and we invest in or purchase securities similar to the Notes in the normal course of our business.  We and any accounts for which we are acting are each able to bear the economic risk of our or its investment.
 
2.  We understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence. We agree on our own behalf and on behalf of any investor account for which we are purchasing Notes to offer, sell or otherwise transfer such Notes prior to the date which is two years after the later of the date of original issue and the last date on which the Company or any affiliate of the Company was the owner of such Notes (or any predecessor thereto) (the “ Resale Restriction Termination Date ”) only (a) to the Company, (b) pursuant to a registration statement which has been declared effective under the Securities Act, (c) in a transaction complying with the requirements of Rule 144A under the Securities Act (“ Rule 144A ”), to a person we reasonably believe is a qualified institutional buyer under Rule 144A (a “ QIB ”) that purchases for its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is purchasing for its own account or for the account of such an institutional “accredited investor,” in each case in a minimum principal amount of Notes of $250,000 or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property or the property of such investor account or accounts be at all times within our or their control and in compliance with any applicable state securities laws. The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date.  If any resale or other transfer of the Notes is proposed to be made pursuant to clause (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Company and the Trustee, which shall provide, among other things, that the transferee is an institutional “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act) that is Acquiring such Notes for investment purposes and not for distribution in violation of the Securities Act. Each purchaser acknowledges that the Company and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Restriction Termination Date of the Notes pursuant to clauses (d), (e) or (f) above to require the delivery of an opinion of counsel, certifications and/or other information satisfactory to the Company and the Trustee.
 
TRANSFEREE:_____________________________
BY:______________________________________
 

 
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                      SECTION 2.8. Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S.
 
             [Date]

The Black & Decker Corporation
c/o The Bank of New York
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
 
Re:           The Black & Decker Corporation
7.125% Senior Notes Due 2011 (the “Securities”)
 
Ladies and Gentlemen:
 
In connection with our proposed sale of $________ aggregate principal amount of the Securities, we confirm that such sale has been effected pursuant to and in accordance with Regulation S under the United States Securities Act of 1933, as amended (the “ Securities Act ”), and, accordingly, we represent that:
 
(a)  the offer of the Securities was not made to a person in the United States;
 
(b)  either (i) at the time the buy order was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States or (ii) the transaction was executed in, on or through the facilities of a designated off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged with a buyer in the United States;
 

 
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(c)  no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(a)(2) or Rule 904(a)(2) of Regulation S, as applicable; and
 
(d)  the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.
 
In addition, if the sale is made during a distribution compliance period and the provisions of Rule 903(b)(2) or Rule 904(b)(1) of Regulation S are applicable thereto, we confirm that such sale has been made in accordance with the applicable provisions of Rule 903(b)(2) or Rule 904(b)(1), as the case may be.
 
You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.
 
Very truly yours,
 
[Name of Transferor]
 
By:____________________________
Authorized Signature
 
SECTION 2.9. Mutilated , Destroyed , Lost or Stolen Securities.   If a mutilated Security is surrendered to the Registrar or if the Holder of a Security claims that the Security has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security if the requirements of Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies any other reasonable requirements of the Trustee.  If required by the Trustee or the Company, such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss which any of them may suffer if a Security is replaced, and, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and upon Company Order the Trustee shall authenticate and make available for delivery, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.
 
In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.
 
Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith.
 

 
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Every new Security issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company and any other obligor upon the Securities, whether or not the mutilated, destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.
 
The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.
 
SECTION 2.10. Outstanding Securities.   Securities outstanding at any time are all Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section as not outstanding. A Security ceases to be outstanding in the event the Company or a Subsidiary holds the Security, provided, however, that (i) for purposes of determining which are outstanding for consent or voting purposes hereunder, Securities shall cease to be outstanding in the event the Company or an Affiliate of the Company holds the Security and (ii) in determining whether the Trustee shall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Securities are present at a meeting of Holders of Securities for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Securities which a Trust Officer of the Trustee actually knows to be held by the Company or an Affiliate of the Company shall not be considered outstanding.
 
If a Security is replaced pursuant to Section 2.9 , it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Security is held by a bona fide purchaser.
 
If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Securityholders on that date pursuant to the terms of this Indenture, then on and after that date such Securities (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
 
SECTION 2.11. Temporary Securities.   Until Definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities. Temporary Securities shall be substantially in the form of Definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Definitive Securities. After the preparation of Definitive Securities, the temporary Securities shall be exchangeable for Definitive Securities upon surrender of the temporary Securities at any office or agency maintained by the Company for that purpose and such exchange shall be without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities, the Company shall execute, and the Trustee shall authenticate and make available for delivery in exchange therefor, one or more Definitive Securities representing an equal principal amount of Securities. Until so exchanged, the Holder of temporary Securities shall in all respects be entitled to the same benefits under this Indenture as a holder of Definitive Securities.
 

 
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SECTION 2.12. Cancellation.   The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel and return to the Company all Securities surrendered for registration of transfer, exchange, payment or cancellation. The Company may not issue new Securities to replace Securities it has paid or delivered to the Trustee for cancellation for any reason other than in connection with a transfer or exchange.
 
SECTION 2.13. Payment of Interest; Defaulted Interest.   Interest on any Security which is payable, and is punctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Security (or one or more predecessor Securities) is registered at the close of business on the regular record date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 2.3 .
 
Any interest on any Security which is payable, but is not paid when the same becomes due and payable and such nonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder on the regular record date by virtue of having been such Holder, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Securities (such defaulted interest and interest thereon herein collectively called “ Defaulted Interest ”) shall be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:
 
(a)  The Company may elect to make payment of any Defaulted Interest  to the Persons in whose names the Securities (or their respective  predecessor Securities) are registered at the close of business on a  Special Record Date (as defined below) for the payment of such Defaulted  Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security and the date (not less than 30 days after such  notice) of the proposed payment (the “ Special Interest Payment Date ”), and  at the same time the Company shall deposit with the Trustee an amount of  money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a record date (the “ Special Record Date ”) for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the Special Interest Payment Date and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date, and in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor to be given in the manner provided for in Section 10.2 , not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names the Securities (or their respective predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (b).
 

 
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(b)  The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.
 
Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.
 
SECTION 2.14. Computation of Interest.   Interest on the Securities shall be computed on the basis of a 360-day year of twelve 30-day months.
 
SECTION 2.15. CUSIP and ISIN Numbers.   The Company in issuing the Securities may use “CUSIP” and “ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such CUSIP or ISIN numbers. The Company shall promptly notify the Trustee of any change in the CUSIP and ISIN numbers.
 
ARTICLE III
 
Covenants
 
SECTION 3.1. Payment of Securities.   The Company shall promptly pay the principal of and interest on the Securities on the dates and in the manner provided in the Securities and in this Indenture. Principal and interest shall be considered paid on the date due if on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Securityholders on that date.
 

 
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The Company shall pay interest on overdue principal at the rate specified therefor in the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
 
Notwithstanding anything to the contrary contained in this Indenture, the Company may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder.
 
SECTION 3.2. Limitation on Liens.   (a)  The Company will not, and will not permit any Subsidiary to, directly or indirectly, as security for any Debt, mortgage, pledge or create or permit to exist any lien on any shares of stock, indebtedness or other obligations of a Subsidiary or any Principal Property, whether such shares of stock, indebtedness or other obligations of a Subsidiary or Principal Property are owned at the date of the Indenture or hereafter acquired, unless the Company secures or causes to be secured any outstanding Securities equally and ratably with all Debt secured by such mortgage, pledge or lien, so long as that Debt shall be secured; provided, however, that the foregoing limitation shall not apply in the case of (i) the creation of any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired (including acquisitions by way of merger or consolidation) by the Company or a Subsidiary contemporaneously with such acquisition, or within 120 days thereafter, to secure or provide for the payment or financing of any part of the purchase price thereof, or the assumption of any mortgage, pledge or other lien upon any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired existing at the time of such acquisition, or the acquisition of any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property subject to any mortgage, pledge or other lien without the assumption thereof, provided that any mortgage, pledge or lien referred to in this clause (i) shall attach only to the shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property so acquired and fixed improvements thereon, (ii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property existing on the date that the Securities are first issued, (iii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property in favor of the Company or any Subsidiary, (iv) any mortgage, pledge or other lien on a Principal Property being constructed or improved securing Debt incurred to finance the construction or improvements, (v) any mortgage, pledge or other lien on shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property incurred in connection with the issuance by a state or political subdivision thereof of any securities the interest on which is exempt from Federal income taxes by virtue of Section 103 of the United States Internal Revenue Code of 1986, as amended, or any other laws and regulations in effect at the time of such issuance and (vi) any renewal of or substitution for any mortgage, pledge or other lien permitted by any of the preceding clauses (i) through (v); provided, in the case of a mortgage, pledge or other lien permitted under clause (i), (ii) or (iv), the Debt secured is not increased nor the lien extended to any additional assets.
 

 
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(b)  Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may create or assume liens in addition to those permitted by the foregoing paragraph (a), and renew, extend or replace such liens; provided that at the time of such creation, assumption, renewal, extension or replacement, and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 3.3. Limitation on Sale Leaseback Transactions.   (a)  The Company will not, and will not permit, any Subsidiary to, sell or transfer, directly or indirectly, except to the Company or a Subsidiary, a Principal Property as an entirety, or any substantial portion thereof, with the intention of taking back a lease of all or part of such property except a lease for a period of three years or less at the end of which it is intended that the use of such property by the lessee will be discontinued; provided that, notwithstanding the foregoing, the Company or any Subsidiary may sell a Principal Property and lease it back for a longer period (i) if the Company or such Subsidiary would be entitled, pursuant to Section 3.2 , to create a mortgage on the property to be leased securing Debt in an amount equal to the Attributable Debt with respect to the sale and lease-back transaction without equally and ratably securing the outstanding Securities or (ii) if (A) the Company promptly informs the Trustee of such transactions, (B) the net proceeds of such transaction are at least equal to the fair value (as determined by a Board Resolution) of such property and (C) the Company causes an amount equal to the net proceeds of the sale to be applied to the retirement (whether by redemption, cancellation after open-market purchases, or otherwise), within 120 days after receipt of such proceeds, of Funded Debt having an outstanding principal amount equal to the net proceeds.
 
(b)  Notwithstanding the foregoing paragraph (a), the Company or any Subsidiary may enter into sale and lease-back transactions in addition to those permitted by the foregoing paragraph (a), and without any obligation to retire any outstanding Funded Debt; provided that a the time of entering into such sale and lease-back transactions and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 3.4. Maintenance of Office or Agency .  The Company shall maintain in The City of New York an office or agency where the Securities may be presented or surrendered for payment, where, if applicable, the Securities may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The principal corporate trust office (the “ Corporate Trust Office ”) of the Trustee located in The City of New York shall be such office or agency of the Company, unless the Company shall designate and maintain some other office or agency for one or more of such purposes. The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
 

 
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The Company may also from time to time designate one or more other offices or agencies (in or outside of The City of New York) where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in The City of New York for such purposes. The Company shall give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such other office or agency.
 
SECTION 3.5. Compliance Certificate.   The Company shall deliver to the Trustee within 120 days after the end of each Fiscal Year of the Company an Officers’ Certificate stating that in the course of the performance by the signers of their duties as Officers of the Company they would normally have knowledge of any Default or Event of Default and whether or not the signers know of any Default or Event of Default that occurred during such period. If they do, the certificate shall describe the Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto. The Company also shall comply with TIA (S) 314(a)(4).
 
SECTION 3.6. Statement by Officers as to Default.   The Company shall deliver to the Trustee within 10 days after the Company becomes aware of the occurrence of any Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default, an Officers’ Certificate setting forth the details of such Default or Event of Default and the action which the Company proposes to take with respect thereto.
 
SECTION 3.7. Further Instruments and Acts.   Upon reasonable request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
 
ARTICLE IV
 
Successor Company
 
SECTION 4.1. Merger , Consolidation or Sale of All or Substantially All Assets of the Company.   The Company shall not consolidate with or merge into, or transfer, directly or indirectly, all or substantially all of its assets to another corporation or other Person unless (1) the resulting, surviving or transferee corporation or other Person assumes by supplemental indenture all the obligations of the Company under the Securities and this Indenture, (2) immediately after giving effect to such transaction, no Event of Default, and no circumstances that, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing, and (3) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture comply with this Indenture, and thereafter all such obligations of the Company shall terminate.
 

 
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ARTICLE V
 
Redemption of Securities
 
SECTION 5.1. Optional Redemption.   The Securities may be redeemed, at the option of the Company, at any time in whole, or from time to time in part, subject to the conditions and at the redemption prices specified in the form of Securities set forth in Exhibit A and Exhibit B hereto, which are hereby incorporated by reference and made a part of this Indenture, together with accrued and unpaid interest to the Redemption Date.
 
SECTION 5.2. Applicability of Article.   Redemption of Securities at the election of the Company or otherwise, as permitted by any provision of this Indenture, shall be made in accordance with such provision and this Article.
 
SECTION 5.3. Election to Redeem; Notice to Trustee.   The election of the Company to redeem any Securities pursuant to Section 5.1 shall be evidenced by a Board Resolution. In case of any redemption at the election of the Company, the Company shall, upon not later than the earlier of the date that is 30 days prior to the Redemption Date fixed by the Company or the date on which notice is given to the Holders (except as provided in Section 5.5 or unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Securities to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Securities to be redeemed pursuant to Section 5.4 .
 
SECTION 5.4. Selection by Trustee of Securities to Be Redeemed.   If less than all the Securities are to be redeemed at the option of the Company at any time pursuant to Section 5.1 , the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee from the outstanding Securities not previously called for redemption, in compliance with the requirements of the principal national securities exchange, if any, on which such Securities are listed, or, if such Securities are not so listed, then on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements) and which may provide for the selection for redemption of portions of the principal of the Securities; provided, however, that (i) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.
 
The Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.
 
For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Securities shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed.
 

 
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SECTION 5.5. Notice of Redemption.   Notice of redemption shall be given in the manner provided for in Section 10.2 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed.  The Trustee shall give notice of redemption in the Company’s name and at the Company’s expense; provided, however, that the Company shall deliver to the Trustee, at least 15 days prior to the date on which such notice is to be given, an Officers’ Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the following items.
 
All notices of redemption shall state:
 
(1)  the Redemption Date,
 
(2)  the redemption price and the amount of accrued interest to the  Redemption Date payable as provided in Section 5.7, if any,
 
(3)  if less than all outstanding Securities are to be redeemed, the  identification of the particular Securities (or portion thereof) to be  redeemed, as well as the aggregate principal amount of Securities to be  redeemed and the aggregate principal amount of Securities to be outstanding after such partial redemption,
 
(4)  in case any Security is to be redeemed in part only, the notice  which relates to such Security shall state that on and after the Redemption  Date, upon surrender of such Security, the Holder will receive, without charge, a new Security or Securities of authorized denominations for the  principal amount thereof remaining unredeemed,
 
(5)  that on the Redemption Date the redemption price (and accrued  interest, if any, to the Redemption Date payable as provided in Section 5.7 ) will become due and payable upon each such Security, or the portion thereof, to be redeemed, and, unless the Company defaults in making the redemption payment, that interest on Securities called for redemption (or the portion thereof) will cease to accrue on and after said date,
 
(6)  the place or places where such Securities are to be surrendered for payment of the redemption price and accrued interest, if any,
 
(7)  the name and address of the Paying Agent,
 
(8)  that Securities called for redemption must be surrendered to the Paying Agent to collect the redemption price,
 

 
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(9)  the CUSIP and ISIN numbers, and that no representation is made as to the accuracy or correctness of the CUSIP and ISIN numbers, if any, listed in such notice or printed on the Securities, and
 
(10)  the paragraph of the Securities pursuant to which the Securities are to be redeemed.
 
SECTION 5.6. Deposit of Redemption Price.   Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 2.4 ) an amount of money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on that date.
 
SECTION 5.7. Securities Payable on Redemption Date.   Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the redemption price therein specified (together with accrued interest, if any, to the Redemption Date), and from and after such date (unless the Company shall default in the payment of the redemption price and accrued interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the redemption price, together with accrued interest, if any, to the Redemption Date (subject to the rights of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).
 
If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid, bear interest from the Redemption Date at the rate borne by the Securities.
 
SECTION 5.8. Securities Redeemed in Part.   Any Security which is to be redeemed only in part pursuant to the provisions of this Article V shall be surrendered at the office or agency of the Company maintained for such purpose pursuant to Section 3.4 (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Security at the expense of the Company, a new Security or Securities, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered, provided that each such new Security will be in a principal amount of $1,000 or integral multiple thereof.
 
 
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ARTICLE VI
 
Defaults and Remedies
 
SECTION 6.1. Events of Default.   An “Event of Default” occurs if:
 
(1)  the Company defaults in any payment of interest or additional interest (as required by the Exchange and Registration Rights Agreement) on any Security when the same becomes due and payable, and such default continues for a period of 30 days;
 
(2)  the Company defaults in the payment of the principal on any  Security when the same becomes due and payable at its Stated Maturity, upon optional redemption, upon declaration or otherwise;
 
(3)  the Company defaults in the performance of or breaches any covenant or agreement in this Indenture or under the Securities, other than those referred to in (1) or (2) above, and such default continues for 30 days after written notice (which notice must specify the default, demand that it be remedied and state that the notice is a “Notice of Default”) from the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities;
 
(4)  (A) the Company or any of its Subsidiaries fails to pay, in accordance with its terms and when payable, any of the principal, interest or additional amounts, if any, on any Debt (including the Securities, other than the Securities, if any, with respect to which the failure to pay principal, interest or additional interest is also an Event of Default under Sections 6.1(1), 6.1(2) or both) having, in the aggregate, a then outstanding principal amount in excess of $20,000,000, at the later of final maturity or the expiration of any applicable grace period or (B) the maturity of Debt in an aggregate principal amount in excess of $20,000,000 is accelerated, if such acceleration results from a default under the instrument giving rise to or securing such Debt;
 
(5)  the Company pursuant to or within the meaning of any Bankruptcy Law (as defined below):
 
(A)  commences a voluntary case;
 
(B)  consents to the entry of an order for relief against it in an involuntary case;
 
(C)  consents to the appointment of a Custodian (as defined below) of it or for any substantial part of its property; or
 
(D)  makes a general assignment for the benefit of its creditors; or
 
(6)  a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
 
(A)  is for relief against the Company in an involuntary case;
 
(B)  appoints a Custodian of the Company for all or substantially all of the Company’s property; or
 
 
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(C)  orders the winding up or liquidation of the Company; and in each case the order or decree remains unstayed and in effect for 60 days.
 
The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by
operation of law or pursuant to any judgment, decree or order of any court or any order, rule or Regulation of any administrative or governmental body.
 
The term “ Bankruptcy Law ” means Title 11, United States Code , or any similar Federal or state law for the relief of debtors.  The term “ Custodian ” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
 
SECTION 6.2. Acceleration.   If an Event of Default described in clauses (1), (2), (3) and (4) of Section 6.1 occurs and is continuing, the Trustee, or the Holders of at least 25% in outstanding principal amount of the Securities, by notice to the Company, may, and the Trustee at the written request of such Holders shall, declare the principal of and accrued and unpaid interest, if any, on all the Securities to be due and payable. Upon such a declaration, such principal and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clauses (5) and (6) above occurs and is continuing, the principal of and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
SECTION 6.3. Other Remedies.   If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture.
 
The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative.
 
SECTION 6.4. Waiver of Past Defaults.   The Holders of a majority in principal amount of the outstanding Securities by notice to the Trustee may (a) waive, by their consent (including, without limitation consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities), an existing Default or Event of Default and its consequences except a Default or Event of Default in the payment of the principal of or interest on a Security or (ii) a Default or Event of Default in respect of a provision that under Section 9.2 cannot be amended without the consent of each Securityholder affected and (b) rescind any such acceleration with respect to the Securities and its consequences if (1) rescission would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, other than the nonpayment of the principal of and interest on the Securities that have become due solely by such declaration of acceleration, have been cured or waived. When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right.
 

 
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SECTION 6.5. Control by Majority.   The Holders of a majority in principal amount of the outstanding Securities may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or, subject to Section 7.1 and Section 7.2 , that the Trustee determines is unduly prejudicial to the rights of other Securityholders or would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any action hereunder, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.
 
SECTION 6.6. Limitation on Suits.   Subject to Section 6.7 , a Securityholder may not pursue any remedy with respect to this Indenture or the Securities unless:
 
(1)  the Holder gives to the Trustee written notice stating that an Event of Default is continuing;
 
(2)  the Holders of at least 25% in outstanding principal amount of the Securities make a request to the Trustee to pursue the remedy;
 
(3)  such Holder or Holders offer to the Trustee reasonable security or indemnity satisfactory to the Trustee against any loss, liability or expense;
 
(4)  the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and
 
(5)  the Holders of a majority in principal amount of the Securities do not give the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such request during such 60-day period.
 
A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over another Securityholder.
 
SECTION 6.7. Rights of Holders to Receive Payment.   Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.6 ), the right of any Holder to receive payment of principal of or interest on the Securities held by such Holder, on or after the respective due dates expressed in the Securities, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.
 
SECTION 6.8. Collection Suit by Trustee.   If an Event of Default specified in Section 6.1(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount then due and owing (together with interest on any unpaid interest to the extent lawful) and the amounts provided for in Section 7.7 .
 

 
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SECTION 6.9. Trustee May File Proofs of Claim .  The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Securityholders allowed in any judicial proceedings relative to the Company, its Subsidiaries or its or their respective creditors or properties and may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.7 .
 
SECTION 6.10. Priorities.   If the Trustee collects any money or property pursuant to this Article VI , it shall pay out the money or property in the following order:
 
FIRST:  to the Trustee for amounts due under Section 7.7 ;
 
SECOND:  to Securityholders for amounts due and unpaid on the  Securities for principal and interest, ratably, without preference or  priority of any kind, according to the amounts due and payable on the  Securities for principal and interest, respectively; and
 
THIRD:  to the Company.
 
The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section.  At least 15 days before such record date, the Company shall mail to each Securityholder and the Trustee a notice that states the record date, the payment date and amount to be paid.
 
SECTION 6.11. Undertaking for Costs.   In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.7 or a suit by Holders of more than 10% in outstanding principal amount of the Securities.
 
 
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ARTICLE VII
 
Trustee
 
SECTION 7.1. Duties of Trustee.   (a)  If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs; provided that if an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against any loss, liability or expense (other than as provided in clause (c) below).
 
(b)  Except during the continuance of an Event of Default:
 
(1)  the Trustee undertakes to perform such duties and only such  duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
 
(2)  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
 
(c)  The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
 
(1)  this paragraph does not limit the effect of paragraph (b) of this Section;
 
(2)  the Trustee shall not be liable for any error of judgment made in  good faith by a Trust Officer unless it is proved that the Trustee was  negligent in ascertaining the pertinent facts; and
 
(3)  the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.5 .
 
(d)  Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
 
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(e)  The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.
 
(f)  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
 
(g)  No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
 
(h)  Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section and to the provisions of the TIA.
 
(i)  Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer.
 
(j)  The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to it against any loss, liability or expense (including reasonable attorneys’ fees and expenses) that might be incurred by it in compliance with such request or direction.
 
SECTION 7.2. Rights of Trustee.   Subject to Section 7.1 , (a)  The Trustee may conclusively rely on any document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or matter stated in the document.
 
(b)  Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate and/or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officers’ Certificate or Opinion of Counsel.
 
(c)  The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
 
(d)  The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers, provided, however, that the Trustee’s conduct does not constitute willful misconduct or negligence.
 
 
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(e)  The Trustee may consult with counsel of its selection, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
 
(f)  The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make further inquiry or investigation into such facts or matters as it may see fit, personally or by agent or attorney, at the sole cost of the Company and with the Company’s
cooperation and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
 
(g)  The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
 
(h)  The Trustee may request that the Company deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as authorized in any such certificate previously delivered and not superseded.
 
SECTION 7.3. Individual Rights of Trustee.   The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights. However, the Trustee must comply with Section 7.10 and Section 7.11. In addition, the Trustee shall be permitted to engage in transactions with the Company; provided, however, that if the Trustee acquires any conflicting interest the Trustee must (i) eliminate such conflict within 90 days of acquiring such conflicting interest, (ii) apply to the SEC for permission to continue acting as Trustee or (iii) resign.
 
SECTION 7.4. Trustee’s Disclaimer.   The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Securities, shall not be accountable for the Company’s use of the proceeds from the Securities and shall not be responsible for any statement of the Company in this Indenture or in any document issued in connection with the sale of the Securities or in the Securities other than the Trustee’s certificate of authentication.
 
SECTION 7.5. Notice of Defaults.   If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall mail to each Securityholder at the address set forth in the Note Register notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of or interest on any Security (including payments pursuant to the optional redemption provisions of such Security), the Trustee may withhold the notice if and so long as its Board of Directors, a committee of its Board of Directors or a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Securityholders.
 

 
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SECTION 7.6. Reports by Trustee to Holders.   As promptly as practicable after each May 15 beginning with the May 15 following the date of this Indenture, and in any event prior to July 15 in each year, the Trustee shall mail to each Securityholder a brief report dated as of such May 15 that complies with TIA (S) 313(a). The Trustee also
shall comply with TIA (S) 313(b). The Trustee shall also transmit by mail all reports required by TIA (S) 313(c).
 
A copy of each report at the time of its mailing to Securityholders shall be filed with the SEC and each stock exchange (if any) on which the Securities are listed.  The Company agrees to notify promptly the Trustee whenever the Securities become listed on any stock exchange and of any delisting thereof.
 
SECTION 7.7. Compensation and Indemnity.   The Company shall pay to the Trustee from time to time such compensation for its acceptance of this Indenture and services hereunder as the Company and the Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, costs of preparing and reviewing reports, certificates and other documents, costs of preparation and mailing of notices to Securityholders and reasonable costs of counsel retained by Trustee in connection with the delivery of an Opinion of Counsel or otherwise, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s agents, counsel, accountants and experts. The Company shall indemnify the Trustee against any and all loss, liability, damages, claims or expense (including reasonable attorneys’ fees and expenses) incurred by it without negligence or bad faith on its part in connection with the acceptance or administration of this trust and the performance of its duties hereunder, including the costs and expenses of enforcing this Indenture (including this Section 7.7 ) and of defending itself against any claims (whether asserted by any Securityholder, the Company or otherwise). The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee shall provide reasonable cooperation in the defense. The Trustee may have separate counsel and the Company shall pay the fees and expenses of such counsel, provided that the Company shall not be required to pay such fees and expenses if it assumes the Trustee’s defense, and, in the reasonable judgment of counsel to the Trustee, there is no conflict of interest between the Company and the Trustee in connection with such defense.  The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
 
To secure the Company’s payment obligations in this Section, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee, other than money or property held in trust to pay principal of and interest on particular Securities.  The Trustee’s right to receive payment of any amounts due under this Section 7.7 shall not be subordinate to any other liability or Debt of the Company.
 

 
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The Company’s payment obligations pursuant to this Section shall survive the discharge of this Indenture.  When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.1(5) or (6) with respect to the Company, the expenses are intended to constitute expenses of administration under any Bankruptcy Law.
 
SECTION 7.8. Replacement of Trustee.   The Trustee may resign at any time by so notifying the Company. The Holders of a majority in principal amount of the Securities may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee. The Company shall remove the Trustee if:
 
(1)  the Trustee fails to comply with Section 7.10 ;
 
(2)  the Trustee is adjudged bankrupt or insolvent;
 
(3)  a receiver or other public officer takes charge of the Trustee or  its property; or
 
(4)  the Trustee otherwise becomes incapable of acting.
 
If the Trustee resigns or is removed by the Company or by the Holders of a majority in principal amount of the Securities and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of the Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee.
 
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of its succession to Securityholders.  The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.7 .
 
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of 10% in principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee.
 
If the Trustee fails to comply with Section 7.10 , any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
 
 
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Notwithstanding the replacement of the Trustee pursuant to this Section, the Company’s obligations under Section 7.7 shall continue for the benefit of the retiring Trustee.
 
SECTION 7.9. Successor Trustee by Merger.   If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.
 
In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture, any of
the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor to the Trustee; provided that the right to adopt the certificate of authentication of any predecessor Trustee or authenticate Securities in the name of any predecessor Trustee shall only apply to its successor or successors by merger, consolidation or conversion.
 
SECTION 7.10. Eligibility; Disqualification.   The Trustee shall at all times satisfy the requirements of TIA (S) 310(a).  The Trustee shall have a combined capital and surplus of at least $50 million as set forth in its most recent published annual report of condition.  The Trustee shall comply with TIA (S) 310(b); provided, however, that there shall be excluded from the operation of TIA (S) 310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in TIA (S) 310(b)(1) are met.
 
SECTION 7.11. Preferential Collection of Claims Against Company.   The Trustee shall comply with TIA (S) 311(a), excluding any creditor relationship listed in TIA (S) 311(b). A Trustee who has resigned or been removed shall be subject to TIA (S) 311(a) to the extent indicated.
 
ARTICLE VIII
 
Satisfaction and Discharge of Indenture
 
SECTION 8.1. Option To Effect Legal Defeasance or Covenant Defeasance.   The Company may, at the option of its Board of Directors evidenced by a Board Resolution, at any time, elect to have either Section 8.2 or 8.3 be applied to all outstanding Securities upon compliance with the conditions set forth below in this Article VIII.
 
SECTION 8.2. Legal Defeasance and Discharge.   Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.2, the Company shall be deemed to have been discharged from its obligations under this Indenture with respect to all outstanding Securities on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, such Legal Defeasance means that the Company shall be deemed to have paid and discharged all the obligations relating to the outstanding Securities and such Securities shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.6 and Section 8.8, and to have satisfied all of its other obligations under such Securities and this Indenture and cured all then existing Events of Default with respect to such Securities (and the Trustee, on demand of and at the expense of the Company shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Securities to receive payments in respect of the principal and accrued interest on such Securities when such payments are due or on the Redemption Date solely out of the trust created pursuant to this Indenture; (b) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s obligations in connection therewith; and (c) this Article VIII and the obligations set forth in Section 8.6 hereof.
 

 
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SECTION 8.3. Covenant Defeasance.   Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.3, the Company shall be released from any obligations under the covenants contained in Sections 3.2 and 3.3 hereof with respect to the outstanding Securities on and after the date the conditions set forth below are satisfied (hereinafter, “Covenant Defeasance”), and the Securities shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Securities shall not be deemed outstanding for accounting purposes).  For this purpose, such Covenant Defeasance means that, with respect to the outstanding Securities, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default with respect to the Securities under Section 6.1(3), nor shall any event referred to in Sections 6.1(4) thereafter constitute a Default or Event of Default with respect to the Securities, but, except as specified above, the remainder of this Indenture and such Securities shall be unaffected thereby.
 
SECTION 8.4. Conditions to Legal or Covenant Defeasance.   The following shall be the conditions to the application of either Section 8.2 or Section 8.3 to the outstanding Securities:
 
(i)  in the case of Legal Defeasance, either (A) all Securities theretofore authenticated and delivered under the Indenture must have been delivered to the Trustee for cancellation or (B) the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Securities on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Securities;
 
 
 
42
 

 
(ii)  in the case of Covenant Defeasance, the Company must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities or a combination thereof in such amounts (and, in the case of U.S. Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient to pay the principal of and accrued interest due on the outstanding Securities on the Stated Maturity date or on the applicable Redemption Date, as the case may be, of such principal of and accrued interest on the outstanding Securities;
 
(iii)  in the case of Legal Defeasance, the Company shall have  delivered to the Trustee an Opinion of Counsel reasonably acceptable to the  Trustee confirming that, subject to customary assumptions and exclusions, the Company has received from, or there has been published by, the U.S. Internal Revenue Service a ruling or (2) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, subject to customary assumptions and exclusions, the Holders will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
 
(iv)  in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the Holders will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
 
(v)  such Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument to which the Company is a party or by which the Company is bound;
 
 
43
 
 
(vi)  in the case of Legal Defeasance, 91 days shall have passed during which no Event of Default under Section 6.1(5) or 6.1(6) has occurred;
 
(vii)  the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions  precedent to the defeasance and discharge of the Securities and this  Indenture as contemplated by this Article VIII have been complied with; and
 
(viii)  the Company shall have delivered to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and accrued interest when due and without reinvestment on the deposited U.S. Government Securities plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal and accrued interest when due on all the Securities to maturity.
 
SECTION 8.5. Satisfaction and Discharge of Indenture.   This Indenture will be discharged with respect of the Securities and will cease to be of further effect as to all Securities issued thereunder, when either (a) all such Securities theretofore authenticated and delivered (except lost, stolen or destroyed Securities which have been replaced or paid and Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company) have been delivered to the Trustee for cancellation; or (b)(i) all such Securities not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust an amount of money in U.S. dollars or U.S. Government Securities or any combination thereof sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation for principal and accrued and unpaid interest to the date of maturity or redemption; no Default with respect to the Securities shall have occurred within 91 days of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company is a party or by which it is bound; (iii) the Company has paid or caused to be paid all sums payable by it with respect to the Securities under this Indenture; and (iv) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of such Securities at maturity or the Redemption Date, as the case may be. In addition, with respect to clause (b) of the preceding sentence, the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, stating that all conditions precedent specified herein relating to the satisfaction and discharge of this Indenture have been complied with.
 
SECTION 8.6. Survival of Certain Obligations.   Notwithstanding the satisfaction and discharge of this Indenture referred to in Section 8.1, 8.2, 8.3, 8.4 or 8.5, the respective obligations of the Company and the Trustee under Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.9, 2.10, 2.11, 2.12, 3.4, 3.5, 3.6, 3.7, 6.7, 7.7, 7.8 and this Article VIII shall survive until the Securities are no longer outstanding.  Nothing contained in this Article VIII shall abrogate any of the obligations or duties of the Trustee under this Indenture.
 
 
44
 
 
SECTION 8.7. Acknowledgment of Discharge by Trustee.   Subject to Section 8.10, after (i) the conditions of Section 8.4 or 8.5 have been satisfied, (ii) the Company has paid or caused to be paid all other sums payable hereunder by the Company and (iii) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent referred to in clause (i) above relating to the satisfaction and discharge of this Indenture have been complied with, the Trustee upon written request shall acknowledge in writing the discharge of all of the Company’s obligations under this Indenture except for those surviving obligations specified in this Article VIII.
 
SECTION 8.8. Application of Trust Moneys.   All cash in U.S. dollars and U.S. Government Securities deposited with the Trustee pursuant to Section 8.4 or 8.5 shall be held in trust and applied by the Trustee, in accordance with the provisions of this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders, of all sums due and to become due thereon for principal and accrued interest but such money need not be segregated from other funds except to the extent required by law. The Holder of any Security replaced pursuant to Section 2.9 shall not be entitled to any such payment and shall look only to the Company for any payment which such Holder may be entitled to collect. In connection with the satisfaction and discharge of this Indenture or the defeasance of certain obligations under this Indenture, the Company may direct the Trustee to (i) invest any money received by the Trustee in the U.S. Government Securities deposited in trust in additional U.S. Government Securities, and (ii) deliver or pay to the Company from time to time upon the request of the Company any money or U.S. Government Securities held by it, which, as evidenced by a certificate from a nationally recognized firm of independent accountants, are in excess of the amount thereof which would then have been required to be deposited for the purpose for which such money or U.S. Government Securities were deposited or received.
 
The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Securities deposited pursuant to Section 8.4 or 8.5 or the principal or interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders.
 
SECTION 8.9. Repayment to the Company; Unclaimed Money.   The Trustee and any Paying Agent shall promptly pay or return to the Company upon request any cash or U.S. Government Securities held by them at any time that are not required for the payment of the principal and interest on the Securities for which cash or U.S. Government Securities have been deposited pursuant to Section 8.4 or 8.5.
 
SECTION 8.10. Reinstatement.   If the Trustee or Paying Agent is unable to apply any cash or U.S. Government Securities in accordance with Section 8.2, 8.3, 8.4 or 8.5 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2, 8.3, 8.4 or 8.5 until such time as the Trustee or Paying Agent is permitted to apply all such cash or U.S. Government Securities in accordance with Section 8.2, 8.3, 8.4 or 8.5; provided, however, that if the Company has made any payment of principal of or interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S. Government Securities held by the Trustee or Paying Agent.
 

 
45
 

ARTICLE IX
 
Amendments
 
SECTION 9.1. Without Consent of Holders.   The Company and the Trustee may amend this Indenture or the Securities without notice to or consent of any Securityholder:
 
(1)  to cure any ambiguity, omission, defect or inconsistency;
 
(2)  to comply with Article IV in respect of the assumption by a  Successor Company of an obligation of the Company under this Indenture;
 
(3)  to add guarantees with respect to the Securities;
 
(4)  to secure the Securities;
 
(5)  to add to the covenants of the Company for the benefit of the  Holders or to surrender any right or power herein conferred upon the Company;
 
(6)  to make any change that does not adversely affect the rights of any Securityholder; or
 
(7)  to comply with any requirement of the SEC in connection with the qualification of this Indenture under the TIA.
 
After an amendment under this Section becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment.  The failure to give such notice to all Securityholders at the address set forth in the Note Register, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.1.
 
 
46
 
 
SECTION 9.2. With Consent of Holders.   The Company and the Trustee may amend this Indenture or the Securities without notice to any Securityholder but with the written consent of the Holders of at least a majority in principal amount of the Securities then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities). However, without the consent of each Securityholder affected, an amendment may not:
 
(1)  reduce the amount of Securities whose Holders must consent to an amendment;
 
(2)  reduce the stated rate of or extend the stated time for payment of interest on any Security;
 
(3)  reduce the principal of or extend the Stated Maturity of any Security;
 
(4)  reduce the premium payable upon the redemption of any Security or change the time at which any Security may or shall be redeemed as described above under Article V or any similar provision, whether through  an amendment to or waiver of Article V , a definition or otherwise;
 
(5)  make any Security payable in money other than that stated in the Security;
 
(6)  impair the right of any Holder to receive payment of principal of and interest on such Holder’s Securities on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Securities; or
 
(7)  make any change to the amendment provisions which require each  Holder’s consent or the waiver provisions in Section 6.4 which require each Holder’s consent.
 
It shall not be necessary for the consent of the Holders under this Section 9.2 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.
 
After an amendment under this Section 9.2 becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment.  The failure to give such notice to all Securityholders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.2 .
 
SECTION 9.3. Compliance with Trust Indenture Act.   Every amendment to this Indenture or the Securities shall comply with the TIA as then in effect.
 
SECTION 9.4. Revocation and Effect of Consents and Waivers.   A consent to an amendment or a waiver by a Holder of a Security shall bind the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent or waiver is not made on the Security. However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or portion of the Security if the Trustee receives the notice of revocation before the date the amendment or waiver becomes effective or otherwise in accordance with any related solicitation documents. After an amendment or waiver becomes effective, it shall bind every Securityholder. An amendment or waiver shall become effective upon receipt by the Trustee of the requisite number of written consents under Section 9.1 or Section 9.2 as applicable.
 
 
47
 
The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Securityholders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture.  If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Securityholders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date.  No such consent or action shall be valid or effective if given or taken more than 120 days after such record date.
 
SECTION 9.5. Notation on or Exchange of Securities.   If an amendment changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security regarding the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. Failure to make the appropriate notation or to issue a new Security shall not affect the validity of such amendment.
 
SECTION 9.6. Trustee To Sign Amendments.   The Trustee shall sign any amendment authorized pursuant to this Article IX if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may but need not sign it.  In signing such amendment the Trustee shall be entitled to receive indemnity reasonably satisfactory to it and to receive, and (subject to Section 7.1 and Section 7.2 ) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture and that such amendment is the legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, subject to customary exceptions, and complies with the provisions hereof (including Section 9.3).
 
ARTICLE X
 
Miscellaneous
 
SECTION 10.1. Trust Indenture Act Controls.   If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.
 
 
48
 
 
SECTION 10.2. Notices.   Any notice or communication shall be in writing and delivered in person or mailed by first-class mail addressed as follows:
 
if to the Company:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention: Treasurer
 
with copies to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention: General Counsel
 
Miles & Stockbridge, P.C.
10 Light Street
Baltimore, Maryland 21202
Attention: J.W. Thompson Webb, Esq.
 
if to the Trustee:
 
The Bank of New York
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
 
The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
 
Any notice or communication mailed to a registered Securityholder shall be mailed by first-class mail to the Securityholder at the Securityholder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed.
 
Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders.  If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
 
SECTION 10.3. Communication by Holders with other Holders.   Securityholders may communicate pursuant to TIA (S) 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA (S) 312(c).
 
SECTION 10.4. Certificate and Opinion as to Conditions Precedent.   Upon any request or application by the Company to the Trustee to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee: an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
 
 
49
 
 
SECTION 10.5. Statements Required in Certificate or Opinion.   Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include:
 
(1)  a statement that the individual making such certificate or opinion has read such covenant or condition;
 
(2)  a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
 
(3)  a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.
 
In giving such Opinion of Counsel, counsel may rely as to factual matters on an Officers’ Certificate or on certificates of public officials.
 
SECTION 10.6. When Securities Disregarded.   In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which the Trustee knows are so owned shall be so disregarded. Also, subject to the foregoing, only Securities outstanding at the time shall be considered in any such determination.
 
SECTION 10.7. Rules by Trustee, Paying Agent and Registrar.   The Trustee may make reasonable rules for action by, or a meeting of, Securityholders. The Registrar and the Paying Agent may make reasonable rules for their functions.
 
SECTION 10.8. Legal Holidays.   A “Legal Holiday” is a Saturday, a Sunday or other day on which commercial banking institutions are authorized or required to be closed in New York City. If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday, the record date shall not be affected.
 
SECTION 10.9. GOVERNING LAW.   THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
 
 
50
 
 
SECTION 10.10. No Recourse Against Others.   An incorporator, director, officer, employee, Affiliate or stockholder of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder shall waive and release all such liability.  The waiver and release shall be part of the consideration for the issue of the Securities.
 
SECTION 10.11. Successors.   All agreements of the Company in this Indenture and the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors.
 
SECTION 10.12. Multiple Originals.   The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.  One signed copy is enough to prove this Indenture.
 
SECTION 10.13. Variable Provisions.   The Company initially appoints the Trustee as Paying Agent and Registrar and custodian with respect to any Global Securities.
 
SECTION 10.14. Table of Contents; Headings.   The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
 
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
 
 
 
THE BLACK & DECKER CORPORATION,
 
       
 
     By:
/s/ MICHAEL D. MANGAN  
    Name:  Michael D. Mangan  
   
Title:    Senior Vice President and
      Chief Financial Officer
 
       
 
 
 
THE BANK OF NEW YORK, as Trustee,
 
       
 
     By:
/s/ GEOVANNI BARRIS  
    Name:  Geovanni Barris  
   
Title:    Vice President
 
       
 


 
51
 
 
 
EXHIBIT A

 
[FORM OF FACE OF INITIAL SECURITY AND ADDITIONAL SECURITY]
 
[Applicable Restricted Securities Legend]
 
[Depository Legend, if applicable]
 
No. ___                                                                                        Principal Amount $_____________, as revised by the Schedule of Increases and Decreases in Global Security attached hereto
 
CUSIP NO. ______________
ISIN: ______________
 
7.125% Senior Notes Due 2011
 
The Black & Decker Corporation, a Maryland corporation, promises to pay to __________, or registered assigns, the principal sum of _______________ Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on June 1, 2011.
 
Interest Payment Dates:  June 1 and December 1
 
Record Dates:  May 15 and November 15
 
Additional provisions of this Security are set forth on the other side of this Security.
 
 
THE BLACK & DECKER CORPORATION,
 
       
 
     By:
   
       
 
 
TRUSTEE’S CERTIFICATE OF   AUTHENTICATION
 
   
The Bank of New York,
as Trustee, certifies that this
is one of the Securities referred to in the Indenture.
 
   
By
     
 
Authorized Signatory
 
Date:  June __, 2001
 
 

 
A-1
 
 

[FORM OF REVERSE SIDE OF INITIAL SECURITY AND ADDITIONAL SECURITY]
 
7.125% Senior Note Due 2011
 
1.   Interest
 
The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above.
 
The Company will pay interest semiannually on June 1 and December 1 of each year commencing December 1, 2001.  Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from June 5, 2001.  The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Securities to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.
 
If (i) the Exchange Offer Registration Statement is not filed with the Commission on or prior to 90 days after the Issue Date or the Shelf Registration Statement is not filed with the Commission on or before the Shelf Filing Date, the Exchange Offer Registration Statement is not declared effective within 180 days after the Issue Date or the Shelf Registration Statement is not declared effective within 90 days after the Shelf Filing Date, (iii) the Registered Exchange Offer is not consummated on or prior to 210 days after the Issue Date, or (iv) the Shelf Registration Statement is filed and declared effective within 90 days after the Shelf Filing Date but shall thereafter cease to be effective (at any time that the Company is obligated to maintain the effectiveness thereof) without being succeeded within 30 days by an additional Registration Statement filed and declared effective (each such event referred to in clauses (i) through (iv), a “Registration Default”), the annual interest rate borne by this Security shall be increased by 0.25% from the rate shown above during the period of one or more such Registration Defaults until (i) the applicable Registration Statement is filed, (ii) the Exchange Offer Registration Statement or the Shelf Registration Statement, as the case may be, is declared effective, (iii) the Registered Exchange Offer is consummated, or (iv) the Shelf Registration Statement again becomes effective, as the case may be.  Following the cure of all Registration Defaults, the accrual of additional interest will cease.  Capitalized terms used in this paragraph, but not otherwise defined herein shall have the meanings ascribed to such terms in the Exchange and Registration Rights Agreement, dated as of June 5, 2001 (the “Registration Rights Agreement”), among the Company, Banc of America Securities LLC, J.P.  Morgan Securities Inc. and the other Initial Purchasers named therein.  The Holder of this Security is entitled to the benefits of the Registration Rights Agreement.
 

 
A-2
 

2.   Method of Payment
 
By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Securities at the close of business on May 15 or November 15 next preceding the interest payment date even if Securities are cancelled, repurchased or redeemed after the record date and on or before the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register. Payments in respect of Securities represented by a Global Security (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company. Payments in respect of Securities represented by Definitive Securities (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 
3.   Paying Agent and Registrar
 
Initially, The Bank of New York (the “Trustee”), will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Securityholder.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.
 
4.   Indenture
 
The Company issued the Securities under an Indenture dated as of June 5, 2001 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), between the Company and the Trustee.  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) as in effect on the date of the Indenture (the “Act”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement of those terms.  In the event of any inconsistency between the terms of this Security and the terms of the Indenture, the terms of the Indenture shall control.
 

 
A-3
 
 
 
The Securities are general unsecured senior obligations of the Company, including (a) $400,000,000 aggregate principal amount of Securities being offered on the Issue Date (subject to Section 2.9 of the Indenture) and any Additional Securities.  This Security is one of the Securities referred to in the Indenture.  The Initial Securities, Additional Securities and Exchange Securities will be treated as a single class of securities under the Indenture.
 
The Indenture imposes certain limitations on, among other things: the incurrence of certain liens and sale-leaseback transactions by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.
 
5.   Redemption
 
The Securities will be redeemable, at the option of the Company, at any time in whole, or from time to time in part, upon not less than 30 and not more than 60 days’ prior notice mailed to each Holder of Securities to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of
 
 
●
100% of the principal amount of the Securities to be redeemed; and
 
 
●
the sum of the present values of the remaining scheduled payments thereon  consisting of principal and interest, exclusive of interest accrued to the date of redemption, at the rate in effect on the date of calculation of the redemption price, discounted to the date of redemption on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the applicable Treasury Rate (as defined below), plus 25 basis points;
 
plus, in each case, accrued interest to the date of redemption.
 
For purposes of determining the optional redemption price, the following definitions are applicable:
 
“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Securities to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Securities.
 
“Comparable Treasury Price” means, with respect to any redemption date,
 
 
●
the average of four Reference Treasury Dealer Quotations obtained by the  Trustee for that redemption date, after excluding the highest and lowest of  such reference Treasury Dealer Quotations; or  .  if the Trustee is unable to obtain at least four such Reference Treasury  Dealer Quotations, the average of all Reference Treasury Dealer Quotations obtained by the Trustee.
 

 
A-4
 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.
 
“Reference Treasury Dealer” means each of Banc of America Securities LLC, J.P. Morgan Securities Inc. (or their successors) and two other primary U.S. Government Securities dealers in New York City appointed by the Trustee in consultation with the Company (each, a “Primary Treasury Dealer”); provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer.
 
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, an average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Securities, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such Redemption Date.
 
“Treasury Rate” means, with respect to any redemption date for the Securities,
 
 
●
the yield, under the heading which represents the average for the  immediately preceding week, appearing in the most recently published  statistical release designated “H.15(519)” or any successor publication  which is published weekly by the Board of Governors of the Federal Reserve  System and which establishes yields on actively traded United States  Treasury securities adjusted to constant maturity under the caption  “Treasury Constant Maturities,” for the maturity corresponding to the  Comparable Treasury Issue (if no maturity is within three months before or  after the applicable maturity date, yields for the two published maturities  most closely corresponding to the Comparable Treasury Issue shall be  determined and the Treasury Rate shall be interpolated or extrapolated from  such yields on a straight line basis, rounding to the nearest month); or
 
 
●
if such release (or any successor release) is not published during the week  preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
The Treasury Rate shall be calculated on the third business day preceding the redemption date.
 

 
A-5
 
 

 
In the case of any partial redemption, selection of the Securities for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Securities are listed or, if the Securities are not so listed, then on a pro rata basis, by lot or by such other method as the
Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.  If any Security is to be redeemed in part only, the notice of redemption relating to such Security shall state the portion of the principal amount thereof to be redeemed.  A new Security in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Security.  On and after the redemption date, interest will cease to accrue on Securities or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on such date.
 
6.   Denominations; Transfer; Exchange
 
The Securities are in registered form without coupons in denominations of principal amount of $1,000 and whole multiples of $1,000.  A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not (A) issue, register the transfer of or exchange any Security during a period beginning at the opening of 15 days before the day of any selection of Securities for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 
7.   Persons Deemed Owners
 
The registered Holder of this Security will be treated as the owner of it for all purposes.
 
8.   Unclaimed Money
 
If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.
 
9.   Defeasance
 
Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S. Government Securities for the payment of principal, premium, if any, and interest on the Securities to redemption or maturity, as the case may be.
 

 
A-6
 
 
 
10.   Amendment, Waiver
 
Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Securities and (ii) any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Securityholder affected) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Securities.  Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee may amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Securities, or to secure the Securities, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder.
 
11.   Defaults and Remedies
 
Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Security when due, continued for 30 days; (ii) default in the payment of principal or premium, if any, on any Security when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Securities, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice from the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including the Securities, other than the Securities, , if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $20,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of $20,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
If an Event of Default described in clauses (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Securities by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Securities to be due and payable.  Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 

 
A-7
 
 
 
Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security satisfactory to it.  Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Security) if it determines in good faith that withholding notice is in the interests of Securityholders.
 
12.   Trustee Dealings with the Company
 
Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.
 
13.   No Recourse Against Others
 
An incorporator, director, officer, employee, Affiliate or stockholder, of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
 
14.   Authentication
 
This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Security.
 
15.   Abbreviations
 
Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 

 
A-8
 

16.   CUSIP Numbers
 
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders.  No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
17.   Governing Law
 
This Security shall be governed by, and construed in accordance with, the laws of the State of New York.
 
The Company will furnish to any Securityholder upon written request and without charge to the Securityholder a copy of the Indenture which has in it the text of this Security.  Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  Treasurer
 

 
A-9
 
 
 
ASSIGNMENT FORM
 
To assign this Security, fill in the form below:
 
I or we assign and transfer this Security to
 
____________________________________________
(Print or type assignee’s name, address and zip code)
 
____________________________________________
(Insert assignee’s soc. sec. or tax I.D. No.)
 
and irrevocably appoint ___________ agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.
 

Date:
   
Your Signature:
   
 
 
Signature Guarantee:
 
 
(Signature must be guaranteed)
 
 

 
 
Sign exactly as your name appears on the other side of this Security.
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
In connection with any transfer or exchange of any of the Securities evidenced by this certificate occurring prior to the date that is two years after the later of the date of original issuance of such Securities and the last date, if any, on which such Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that such Securities are being:
 
CHECK ONE BOX BELOW:
 
[_]  1
acquired for the undersigned’s own account, without transfer; or
 
[_]  2
transferred to the Company; or
 
[_]  3
transferred pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”); or
 
[_]  4
transferred pursuant to an effective registration statement under the Securities Act; or
 
[_]  5
transferred pursuant to and in compliance with Regulation S under the Securities Act; or
 

 
A-10
 
 
 
[_]  6
transferred to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act), that  has furnished to the Trustee a signed letter containing certain representations and agreements (the form of which letter appears as Section 2.7 of the Indenture); or
 
[_]  7
transferred pursuant to another available exemption from the registration requirements of the Securities Act of 1933.
 
Unless one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (5), (6) or is checked, the Trustee or the Company may require, prior to registering any such transfer of the Securities, in their sole discretion, such legal opinions, certifications and other information as the Trustee or the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, such as the exemption provided by Rule 144 under such Act.
 
       
   
Signature
 
     
Signature Guarantee:
   
     
       
(Signature must be guaranteed)
 
Signature
 
       
       
   
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 
TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.
 
The undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A.
 
 
 
Dated:
 
 

 
A-11
 

 
[TO BE ATTACHED TO GLOBAL SECURITIES]
 
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
 
The following increases or decreases in this Global Security have been made:
 
 
Date of
Exchange
Amount of decrease in
Principal Amount of this
Global Security
Amount of increase in
Principal Amount of
this Global Security
Principal Amount of
this Global Security
following such
decrease or increase
Signature of
authorized signatory
of Trustee or
Securities Custodian
         
         


 
A-12
 
 
 
EXHIBIT B

 
[FORM OF FACE OF EXCHANGE SECURITY]
 
[Depository Legend, if applicable]
 
No.
Principal Amount $____________,
as revised by the Schedule of
Increases and Decreases in Global
Security attached hereto
   
 
CUSIP NO. _____________
ISIN: _____________

7.125% Senior Notes Due 2011
 
The Black & Decker Corporation, a Maryland corporation, promises to pay to ____________, or registered assigns, the principal sum of _______________ Dollars, as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on June 1, 2011.
 
Interest Payment Dates:  June 1 and December 1
 
Record Dates:  May 15 and November 15
 
Additional provisions of this Security are set forth on the other side of this Security.
 
 
THE BLACK & DECKER CORPORATION
 
       
 
     By:
   
       
 
 
TRUSTEE’S CERTIFICATE OF   AUTHENTICATION
 
   
The Bank of New York,
as Trustee, certifies that this
is one of the Securities referred to in the Indenture.
 
   
By
     
 
Authorized Signatory
 
Date:  June __, 2001
 
 
 
B-1
 

[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
 
7.125% Senior Note Due 2011
 
1.              Interest
 
The Black & Decker Corporation, a Maryland corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above.
 
The Company will pay interest semiannually on June 1 and December 1 of each year commencing December 1, 2001.  Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from June 5, 2001.  The Company shall pay interest on overdue principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Securities to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.
 
2.              Method of Payment
 
By at least 10:00 a.m. (New York City time) on the date on which any principal of or interest on any Security is due and payable, the Company shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest when due.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Securities at the close of business on the May 15 or November 15 next preceding the interest payment date even if Securities are cancelled, repurchased or redeemed after the record date and on or before the interest payment date.  Holders must surrender Securities to a Paying Agent to collect principal payments.  The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Except as described in the succeeding two sentences, the principal of, premium, if any, and interest on the Securities shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Securities represented by a Global Security (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company.  Payments in respect of Securities represented by Definitive Securities (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Securities represented by Definitive Securities will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
 

 
B-2
 
 
3.              Paying Agent and Registrar
 
Initially, The Bank of New York (the “Trustee”), will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Securityholder.  The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar.
 
4.              Indenture
 
The Company issued the Securities under an Indenture dated as of June 5, 2001 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), between the Company and the Trustee.  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) as in effect on the date of the Indenture (the “Act”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement of those terms.  In the event of any inconsistency between the terms of this Security and the terms of the Indenture, the terms of the Indenture shall control.
 
The Securities are general unsecured senior obligations of the Company, including (a) $400,000,000 aggregate principal amount of Securities being offered on the Issue Date (subject to Section 2.9 of the Indenture) and any Additional Securities.  The Security is one of the Securities referred to in the Indenture.  The Initial Securities, Additional Securities and Exchange Securities will be treated as a single class of securities under the Indenture.  The Indenture imposes certain limitations on, among other things:  the incurrence of certain liens and sale-leaseback transaction by the Company or its Subsidiaries and consolidations, mergers and sales of assets of the Company.
 
5.              Redemption
 
The Securities will be redeemable, at the option of the Company, at any time in whole, or from time to time in part, upon not less than 30 and not more than 60 days’ prior notice mailed to each Holder of Securities to be so redeemed at such Holder’s registered address, at a redemption price equal to the greater of
 
 
●
100% of the principal amount of the Securities to be redeemed; and
 
 
●
the sum of the present values of the remaining scheduled payments  thereon consisting of principal and interest, exclusive of interest  accrued to the date of redemption, at the rate in effect on the date  of calculation of the redemption price, discounted to the date of  redemption on a semiannual basis (assuming a 360-day year consisting  of twelve 30-day months) at the applicable Treasury Rate (as defined  below), plus 25 basis points;
 
plus, in each case, accrued interest to the date of redemption.

 
 
 
B-3
 
 
 
For purposes of determining the optional redemption price, the following definitions are applicable:
 
“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Securities to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Securities.
 
“Comparable Treasury Price” means, with respect to any redemption date,
 
 
●
the average of four Reference Treasury Dealer Quotations obtained by the  Trustee for that redemption date, after excluding the highest and lowest  of such reference Treasury Dealer Quotations; or
 
 
●
if the Trustee is unable to obtain at least four such Reference Treasury  Dealer Quotations, the average of all Reference Treasury Dealer  Quotations obtained by the Trustee.
 
“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.
 
“Reference Treasury Dealer” means each of Banc of America Securities LLC, J.P. Morgan Securities Inc. (or their successors) and two other primary U.S. Government Securities dealers in New York City appointed by the Trustee in consultation with the Company (each, a “Primary Treasury Dealer”); provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer.
 
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, an average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Securities, expressed in each case as a percentage of its principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such Redemption Date.
 
“Treasury Rate” means, with respect to any redemption date for the Securities,
 
 
●
the yield, under the heading which represents the average for the  immediately preceding week, appearing in the most recently published  statistical release designated “H.15(519)” or any successor publication  which is published weekly by the Board of Governors of the Federal  Reserve System and which establishes yields on actively traded United  States Treasury securities adjusted to constant maturity under the  caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months  before or after the applicable maturity date, yields for the two  published maturities most closely corresponding to the Comparable  Treasury Issue shall be determined and the Treasury Rate shall be  interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or
 

 
B-4
 
 
 
 
●
if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
 
The Treasury Rate shall be calculated on the third business day preceding the redemption date.
 
In the case of any partial redemption, selection of the Securities for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Securities are listed or, if the Securities are not so listed, then on a pro rata basis, by lot or by such other method as the Trustee shall deem to be fair and appropriate (and in such manner as complies with applicable legal requirements) provided that (i) Securities and portions thereof that the Trustee selects shall be in amounts of $1,000 or an integral multiple of $1,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than $1,000.  If any Security is to be redeemed in part only, the notice of redemption relating to such Security shall state the portion of the principal amount thereof to be redeemed.  A new Security in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Security.  On and after the redemption date, interest will cease to accrue on Securities or portions thereof called for redemption as long as the Company has deposited with the Trustee or with a Paying Agent (or, if applicable, segregated and held in trust) money sufficient to pay the redemption price of, and accrued interest on, all the Securities which are to be redeemed on such date.
 
6.              Denominations; Transfer; Exchange
 
The Securities are in registered form without coupons in denominations of principal amount of $1,000 and whole multiples of $1,000.  A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not (A) issue, register the transfer of or exchange any Security during a period beginning at the opening of 15 days before the day of any selection of Securities for redemption and ending at the close of business on the day of selection, (B) register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (C) register the transfer of or to exchange a Security between a record date and the next succeeding interest payment date.
 

 
B-5
 

 
7.              Persons Deemed Owners
 
The registered Holder of this Security will be treated as the owner of it for all purposes.
 
8.              Unclaimed Money
 
If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another Person. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.
 
9.              Defeasance
 
Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S. Government Securities for the payment of principal, premium, if any, and interest on the Securities to redemption or maturity, as the case may be.
 
10.            Amendment, Waiver
 
Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Securities and (ii) any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Securityholder affected) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Securities.  Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee may amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article IV of the Indenture, or to add guarantees with respect to the Securities, or to secure the Securities, or to add additional covenants of the Company, or surrender rights and powers conferred on the Company, or to comply with any request of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder.
 

 
B-6
 

 
11.            Defaults and Remedies
 
Under the Indenture, Events of Default include (i) default in any payment of interest or additional interest on any Security when due, continued for 30 days; (ii) default in the payment of principal or premium, if any, on any Security when due at its Stated Maturity, upon optional redemption, upon declaration or otherwise; (iii) default by
the Company in the performance of or breaches by the Company of any covenant or agreement in the Indenture or under the Securities, other than those referred to in (i) or (ii), where such default continues for 60 days after written notice from the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities; (iv) (a) failure by the Company or any of its Subsidiaries to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including the Securities, other than the Securities, if any, with respect to which the failure to pay principal, premium, if any, interest or additional interest is also an Event of Default under clauses (i), (ii) or both) having, in the aggregate, a then outstanding principal amount in excess of $20,000,000, at the later of final maturity or the expiration of any applicable grace period or (b) acceleration of the maturity of Debt in an aggregate principal amount in excess of $20,000,000, if that acceleration results from a default under the instrument giving rise to or securing such Debt; or (v) certain events of bankruptcy, insolvency or reorganization of the Company.
 
If an Event of Default described in clauses (i), (ii), (iii) and (iv) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Securities by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the Securities to be due and payable.  Upon such a declaration, such principal, premium and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in clause (v) above occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all the Securities will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.
 
Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security.  Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal of, premium, if any, or interest on any Security) if it determines in good faith that withholding notice is in the interests of Securityholders.
 
12.            Trustee Dealings with the Company
 
Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.
 
13.            No Recourse Against Others
 
An incorporator, director, officer, employee, Affiliate or stockholder of the Company, solely by reason of this status, shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
 

 
B-7
 
 
 
14.            Authentication
 
This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Security.
 
15.            Abbreviations
 
Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT B-7 TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
 
16.            Cusip Numbers
 
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders.  No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
 
17.            Governing Law
 
This Security shall be governed by, and construed in accordance with, the laws of the State of New York.
 
The Company will furnish to any Securityholder upon written request and without charge to the Securityholder a copy of the Indenture which has in it the text of this Security.  Requests may be made to:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention:  Treasurer
 

 
B-8
 

ASSIGNMENT FORM
 
To assign this Security, fill in the form below:
 
I or we assign and transfer this Security to
 
_________________________________________
(Print or type assignee’s name, address and zip code)
 
_________________________________
(Insert assignee’s soc. sec. or tax I.D. No.)
 
and irrevocably appoint ____________ agent to transfer this Security on the books of the Company. The agent may substitute another to act for him.
 

Date:
   
Your Signature:
   
 
 
Signature
Guarantee:
 
 
(Signature must be guaranteed)
 
 
Sign exactly as your name appears on the other side of this Security.
 
The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-15.
 

 
B-9
 

[TO BE ATTACHED TO GLOBAL SECURITIES]
 
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
 
The following increases or decreases in this Global Security have been made:
 
Date of
Exchange
Amount of decrease in
Principal Amount of this
Global Security
Amount of increase in
Principal Amount of
this Global Security
Principal Amount of
this Global Security
following such decrease
or increase
Signature of authorized
signatory of Trustee or
Securities Custodian
         
         

 
 
 
 
 
B-10
Exhibit 4.9
 
 
 

 
 
BLACK & DECKER HOLDINGS INC.,
as Issuer,
 
THE BLACK & DECKER CORPORATION,
as Guarantor
 
AND
 
THE FIRST NATIONAL BANK OF CHICAGO,
 
as Trustee
 

 
INDENTURE
 
Dated as of June 26, 1998
 

 
$150,000,000
 
6.55% Senior Notes due 2007
 
$150,000,000
 
7.05% Senior Notes due 2028
 
 
 

 
 

 

 
TABLE OF CONTENTS
 
Page
 
ARTICLE I
 
DEFINITIONS AND INCORPORATION BY REFERENCE
 
SECTION 1.1.
Definitions
1
SECTION 1.2.
Incorporation by Reference of TIA
7
SECTION 1.3.
Rules of Construction
8
 
ARTICLE II
 
THE TRANCHE A AND TRANCHE B NOTES
 
SECTION 2.1.
Form and Dating
8
SECTION 2.2.
Execution and Authentication
9
SECTION 2.3.
Exchange Agent and Paying Agent
10
SECTION 2.4.
Paying Agent To Hold Assets in Trust
10
SECTION 2.5.
List of Holders
10
SECTION 2.6.
Transfer and Exchange
11
SECTION 2.7.
Replacement Notes
14
SECTION 2.8.
Outstanding Notes
14
SECTION 2.9.
Treasury Notes
15
SECTION 2.10.
Temporary Notes
15
SECTION 2.11.
Cancellation
15
SECTION 2.12.
Defaulted Interest
16
SECTION 2.13.
CUSIP and CINS Number
16
SECTION 2.14.
Deposit of Moneys
16
SECTION 2.15.
Certain Matters Relating to Global Notes.
16
 
ARTICLE III
 
REDEMPTION
 
SECTION 3.1.
Optional Redemption
17
SECTION 3.2.
Election to Redeem; Notice to Trustee
17
SECTION 3.3.
Selection by Trustee of Notes to Be Redeemed
17
SECTION 3.4.
Notice of Redemption
17
SECTION 3.5.
Effect of Notice of Redemption
19
SECTION 3.6.
Deposit of Redemption Price
19
SECTION 3.7.
Notes Redeemed in Part
19
SECTION 3.8.
Applicability of This Article
19
 
 
-i-
 
 
ARTICLE IV
 
COVENANTS
 
SECTION 4.1.
Payment of Notes
20
SECTION 4.2.
Maintenance of Office or Agency
20
SECTION 4.3.
Limitation on Liens
21
SECTION 4.4.
Limitation on Sale-Leaseback Transactions
21
SECTION 4.5.
No Lien Created, etc
22
SECTION 4.6.
Compliance Certificate; Notice of Default
22
SECTION 4.7.
Reports
22
SECTION 4.8.
Payment of Certain Non-Income Taxes and Similar Charges
22
 
ARTICLE V
 
MERGER, CONSOLIDATION OR SALE BY
THE COMPANY AND THE GUARANTOR
 
SECTION 5.1.
Merger, Consolidation or Sale of All or Substantially All Assets of the Company
23
SECTION 5.2.
Merger, Consolidation or Sale of All or Substantially All Assets of the Guarantor
23
 
ARTICLE VI
 
DEFAULT AND REMEDIES
 
SECTION 6.1.
Events of Default
23
SECTION 6.2.
Acceleration
25
SECTION 6.3.
Other Remedies
25
SECTION 6.4.
Waiver of Past Defaults
25
SECTION 6.5.
Control by Majority
25
SECTION 6.6.
Limitation on Suits
25
SECTION 6.7.
Rights of Holders to Receive Payment
26
SECTION 6.8.
Collection Suit by Trustee
26
SECTION 6.9.
Trustee May File Proofs of Claim
26
SECTION 6.10.
Priorities
26
SECTION 6.11.
Undertaking for Costs
27
 
ARTICLE VII
 
TRUSTEE
 
SECTION 7.1.
Duties of Trustee
27
SECTION 7.2.
Rights of Trustee, Subject to Section 7.1:
28
SECTION 7.3.
Individual Rights of Trustee
29
SECTION 7.4.
Trustee’s Disclaimer
29
SECTION 7.5.
Notice of Default
29
SECTION 7.6.
Report by Trustee to Holders
30
SECTION 7.7.
Compensation and Indemnity
30
SECTION 7.8.
Replacement of Trustee
31
SECTION 7.9.
Successor Trustee by Merger, Etc.
32
SECTION 7.10.
Eligibility; Disqualification; Corporate Trust Required; Conflicting Interest
32
SECTION 7.11.
Preferential Collection of Claims Against Company
33
SECTION 7.12.
Authenticating Agents
33
 
 
-ii-
 
 
ARTICLE VIII
 
SATISFACTION AND DISCHARGE OF INDENTURE
 
SECTION 8.1.
Option To Effect Legal Defeasance or Covenant Defeasance
35
SECTION 8.2.
Legal Defeasance and Discharge
35
SECTION 8.3.
Covenant Defeasance
35
SECTION 8.4.
Conditions to Legal or Covenant Defeasance
36
SECTION 8.5.
Satisfaction and Discharge of Indenture
37
SECTION 8.6.
Survival of Certain Obligations
38
SECTION 8.7.
Acknowledgment of Discharge by Trustee
38
SECTION 8.8.
Application of Trust Moneys
38
SECTION 8.9.
Repayment to the Company; Unclaimed Money
39
SECTION 8.10.
Reinstatement
39
 
ARTICLE IX
 
AMENDMENTS, SUPPLEMENTS AND WAIVERS
 
SECTION 9.1.
Without Consent of Holders of Notes
39
SECTION 9.2.
With Consent of Holders of Notes
40
SECTION 9.3.
Compliance with TIA
41
SECTION 9.4.
Revocation and Effect of Consents
41
SECTION 9.5.
Notation on or Exchange of Notes
41
SECTION 9.6.
Trustee To Sign Amendments, Etc.
41
SECTION 9.7.
Effect of Supplemental Indentures
42
 
ARTICLE X
 
GUARANTEES
 
SECTION 10.1.
Guarantees
42
SECTION 10.2.
Successors and Assigns
43
SECTION 10.3.
No Waiver
44
SECTION 10.4.
Modification
44
 
ARTICLE XI
 
MEETINGS OF HOLDERS OF THE NOTES
 
SECTION 11.1.
Purposes of Meetings
44
SECTION 11.2.
Place of Meetings
44
SECTION 11.3.
Call and Notice of Meetings
44
SECTION 11.4.
Voting at Meetings
45
SECTION 11.5.
Voting Rights, Conduct and Adjournment
45
SECTION 11.6.
Revocation of Consent by Holders
45
SECTION 11.7.
No Delay of Rights by Meeting
46
 
 
-iii-
 
 
ARTICLE XII
 
MISCELLANEOUS
 
SECTION 12.1.
TIA Controls
46
SECTION 12.2.
Notices
46
SECTION 12.3.
Notice to Holders
47
SECTION 12.4.
Compliance Certificates and Opinions
48
SECTION 12.5.
Form of Documents Delivered to Trustee
48
SECTION 12.6.
Rules by Trustee, Paying Agent, Exchange Agent
48
SECTION 12.7.
Non-Business Day
49
SECTION 12.8.
Governing Law and Submission to Jurisdiction
49
SECTION 12.9.
No Adverse Interpretation of Other Agreements
49
SECTION 12.10.
Immunity of Incorporators, Stockholders, Employees, Officers and Directors
49
SECTION 12.11.
Successors and Assigns
49
SECTION 12.12.
Counterpart Originals
49
SECTION 12.13.
Severability
49
SECTION 12.14.
Table of Contents, Headings, etc.
49
SECTION 12.15.
Benefits of Indenture
49
SECTION 12.16.
Language of Notices, etc.
50
SIGNATURES
 
50

EXHIBITS
 
Exhibit A
–
Form of Tranche A Global Note
Exhibit B
–
Form of Tranche A Definitive Note
Exhibit C
–
Form of Tranche B Global Note
Exhibit D
–
Form of Tranche B Definitive Note
Exhibit E
–
Form of Transfer Certificate -- U.S. Global Note to Regulation S Global Note During the Restricted Period
Exhibit F
–
Form of Transfer Certificate -- U.S. Global Note to Regulation S Global Note After the Restricted Period
Exhibit G-1
–
Form of Transfer Certificate -- Regulation S Global Note to U.S. Global Note During the Restricted Period
Exhibit G-2
–
Form of Transfer Certificate -- Regulation S Global Notes to U.S. Global Note After the Expiration of the Restricted Period
Exhibit H
–
Form of Exchange Certificate -- Notes Acquired Pursuant to Rule 144A
Exhibit I
–
Form of Exchange Certificate -- Notes Acquired Pursuant to Regulation S

NOTE: This Table of Contents shall not, for any purpose, be deemed to be part of this Indenture.
 
 
-iv-
 
 
CROSS-REFERENCE TABLE
 
TIA
Section
 
Indenture
Section
     
310
(a)(1)                                                                                                  
7.10
 
(a)(2)                                                                                                  
7.10
 
(a)(3)                                                                                                  
NA
 
(a)(4)                                                                                                  
NA
 
(a)(5)                                                                                                  
7.8; 7.10
 
(b)                                                                                                  
7.3; 7.10
 
(c)                                                                                                  
NA
311
(a)                                                                                                  
7.11
 
(b)                                                                                                  
7.11
 
(c)                                                                                                  
NA
312
(a)                                                                                                  
2.5
 
(b)                                                                                                  
14.3
 
(c)                                                                                                  
14.3
313
(a)                                                                                                  
7.6
 
(b)(1)                                                                                                  
NA
 
(b)(2)                                                                                                  
7.6
 
(c)                                                                                                  
7.6;
 
(d)                                                                                                  
7.6
314
(a)                                                                                                  
4.8; 4.10; 14.2;
   
14.4
 
(b)                                                                                                  
NA
 
(c)(1)                                                                                                  
7.2; 14.4
 
(c)(2)                                                                                                  
7.2; 14.4
 
(c)(3)                                                                                                  
NA
 
(d)                                                                                                  
NA
 
(e)                                                                                                  
14.5
 
(f)                                                                                                  
NA
315
(a)                                                                                                  
7.1(c)
 
(b)                                                                                                  
7.5; 14.2
 
(c)                                                                                                  
7.1(a)
 
(d)                                                                                                  
6.5;
   
7.1(c)
 
(e)                                                                                                  
6.11
316
(a)(last sentence)                                                                                                  
2.9
 
(a)(1)(A)                                                                                                  
6.5
 
(a)(1)(B)                                                                                                  
6.4
 
(a)(2)                                                                                                  
NA
 
(b)                                                                                                  
6.7
317
(a)(1)                                                                                                  
6.8
 
(a)(2)                                                                                                  
6.9
 
(b)                                                                                                  
2.4
318
(a)                                                                                                  
14.1
 
(c)                                                                                                  
14.1

NA means Not Applicable.
 
NOTE:  This  Cross-Reference  Table shall not, for any purpose, be deemed to be a part of this Indenture.
 
 
-1-
 
 
INDENTURE dated as of June 26, 1998, among BLACK & DECKER HOLDINGS INC., a corporation organized under the laws of Delaware (the “ Company ”), THE BLACK & DECKER CORPORATION, a corporation organized under the laws of Maryland (the “ Guarantor ”), and THE FIRST NATIONAL BANK OF CHICAGO, a national banking association, as Trustee (the “ Trustee ”).
 
The Company has duly authorized the creation of an issue of $150,000,000 6.55% Senior Notes due 2007 (the “ Tranche A Notes ”) and $150,000,000 7.05% Senior Notes due 2028 (the “ Tranche B Notes ” and together with the Tranche A Notes, the “ Notes ”) and, to provide therefor, the Company has duly authorized the execution and delivery of this Indenture.
 
The Guarantor has duly  authorized the creation of the Guarantee of the Notes and, to provide therefor, the Guarantor has duly authorized the execution and delivery of this Indenture.
 
The Company, the Guarantor and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the Notes:
 
 
ARTICLE I
 
DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.1.   Definitions .  For purposes of this Indenture, unless otherwise specifically indicated herein, the term “consolidated” with respect to any Person refers to such Person consolidated with Subsidiaries.  In addition,  for purposes of the following definitions and this Indenture generally, all calculations and determinations shall be made in accordance with U.S. GAAP and shall be based upon the consolidated financial statements of the Guarantor and its subsidiaries prepared in accordance with U.S. GAAP.  As used in this Indenture, the following terms shall have the following meanings:
 
“ Additional Amounts ” shall have the meaning set forth in paragraph 2 of Exhibit A and Exhibit C hereto.
 
“ Affiliate ” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.
 
“ Agent ” means any Exchange Agent, Paying Agent, Authenticating Agent or co-Exchange Agent.
 
“ Agent Members ” shall have the meaning set forth in Section 2.15.
 
“ Applicable Procedures ” shall have the meaning set forth in Section 2.6(a)(i)(1).
 
“ Attributable Debt ” for a lease means the carrying value of the capitalized rental obligation determined under generally accepted accounting principles whether or not such obligation is required to be shown on the balance sheet as a long-term liability.  The carrying value may be reduced by the capitalized value of the rental obligations, calculated on the same basis, that any sublessee has for all or part of the sample property.
 
 
 
 
“ Authenticating Agent ” shall have the meaning set forth in Section 2.2.
 
“ Authorized Newspaper ” means a newspaper customarily published at least once a day for at least five days in each calendar week and of general circulation in New York City and in London and, if and so long as the Notes are listed on the Luxembourg Stock Exchange and such Stock Exchange shall so require, in Luxembourg or, if it shall be impracticable in the opinion of the Trustee to make such publication, in another capital city in Western Europe.  Such publication (which may be in different newspapers) is expected to be made in the Eastern edition of The Wall Street Journal and in the London edition of the Financial Times, and, if and so long as the Notes are listed on the Luxembourg Stock Exchange and such Stock Exchange shall so require, in the Luxemburger Wort.
 
“ Bankruptcy Law ” shall have the meaning set forth in Section 6.1.
 
“ Board of Directors ” means, with respect to any Person, the board of directors of such Person or any duly authorized committee thereof.
 
“ Board Resolution ” means, with respect to any Person, a resolution of the Board of Directors or of a committee or person to which or to whom the Board of Directors has properly delegated the appropriate authority, a copy of which has been certified by the Secretary or an Assistant Secretary of the Person to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivered to the Trustee.
 
“ Business Day ” when used with respect to any particular Place of Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment are authorized or obligated by law to close, and shall otherwise mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions, at the place where any specified act pursuant to this Indenture is to occur, are authorized or obligated by law to close.
 
“ Cedel ” means Cedel Bank, société anonyme.
 
“ Certificate of a Firm of Independent Public Accountants ” means a certificate signed by any firm of independent public accountants of recognized standing selected by the Company or the Guarantor.  The term “Independent” when used with respect to any specified firm of public accountants means a firm that is or would be qualified to act as the Company’s and the Guarantor’s accountants within the meaning of Section 210.2-01 of Regulation S-X as promulgated by the SEC, and any successor thereto.
 
“ Company ” means the party named as such in this Indenture until a successor replaces it pursuant to this Indenture and thereafter means such successor.
 
“ Company Order ” means a written order or request signed in the name of the Company by (1) the Chairman of the Board, the Vice Chairman of the Board, the President or any Vice President of the Company and by a Director, the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of the Company or (2) any two Persons designated in a Company Order previously delivered to the Trustee by any two of the foregoing officers and delivered to the Trustee.
 
 
-2-
 
 
“ Consolidated Net Tangible Assets ” means total assets less (1) total current liabilities (excluding any Debt which, at the option of the borrower, is renewable or extendible to a term exceeding 12 months and which is included in current liabilities and further excluding any deferred income taxes which are included in current liabilities) and (2) goodwill, patents, trademarks and other like intangibles, all as stated on the Guarantor’s most recent quarter-end consolidated balance sheet preceding the date of determination.
 
“ Corporate Trust Office ” means the address of the Trustee specified in Section 12.2.
 
“ Covenant Defeasance ” shall have the meaning set forth in Section 8.3.
 
“ Custodian ” shall have the meaning set forth in Section 6.1.
 
“ Debt ” means any debt for borrowed money (including the Notes), capitalized lease obligations and purchase money obligations, or any guarantee of such debt, in any such case which would appear on the consolidated balance sheet of the Guarantor as a liability.
 
“ Default ” means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.
 
“ Default Interest Payment Date ” shall have the meaning set forth in Section 2.12.
 
“ Definitive Notes ” means the Tranche A Notes and the Tranche B Notes in definitive form substantially in the form of Exhibit B and Exhibit D, respectively.
 
“ Depositary ” means the book-entry depositary or its nominee or the custodian of either, designated by the Company in the Depositary Agreement until a successor depositary shall have become such pursuant to applicable provisions of the Depositary Agreement, and thereafter “Depositary” shall mean such successor book-entry depositary or its nominee or the custodian of either.
 
“ Depositary Agreement ” means the Note Depositary Agreement dated as of the date of this Indenture between the Depositary, the Company and the Guarantor.
 
“ Distribution ” shall mean, with respect to any Note, any principal, premium, if any, interest, Additional Amounts, if any, or any other payments or distributions in respect of such Note.
 
“ DTC ” means The Depository Trust Company or its successors.
 
“ Euroclear Operator ” means Morgan Guaranty Trust Company of New York (Brussels office), as operator of the Euroclear System.
 
“ Event of Default ” shall have the meaning set forth in Section 6.1.
 
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.
 
“ Exchange Agent ” shall have the meaning set forth in Section 2.3.
 
“ Exempted Debt ” means the sum, without duplication, of the following items outstanding as of the date Exempted Debt is being determined:  (i) Debt incurred after the date of this Indenture and secured by liens created or assumed or permitted to exist pursuant to Section 4.3(b), and (ii) Attributable Debt of the Guarantor and its Subsidiaries in respect of all sale and lease-back transactions with regard to any Principal Property entered into pursuant to Section 4.4(b).
 
 
-3-
 
 
“ First Chicago ” means The First National Bank of Chicago.
 
“ Funded Debt ” means all Debt having a maturity of more than one year from the date of its creation or having a maturity of less than one year but by its terms being renewable or extendible, at the option of the obligor in respect thereof, beyond one year from its creation.
 
“ Global Note ” means a security evidencing all or a part of the Tranche A Notes or the Tranche B Notes deposited with the Depositary in accordance with Section 2.1 and substantially in the form of Exhibit A and Exhibit C, respectively.
 
“ Government Securities ” means securities that are (i) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such Government Securities or a specific payment of principal or interest on any such Government Securities held by such custodian for the account of the holder of such depository receipt; provided , however , that such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal or interest on the Government Securities evidenced by such depository receipt.
 
“ guarantee ” means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Debt or other obligations.
 
“ Guarantees ” shall have the meaning set forth in Section 10.1.
 
“ Guarantor ” shall have the meaning set forth in the preamble of this Indenture until one or more successor corporations shall have become such pursuant to the applicable provisions of this Indenture, and thereafter means such successors.
 
“ Guarantor Order ” means a written order signed in the name of the Guarantor by (1) the Chairman of the Board, the Vice Chairman of the Board, the President or any Vice President of the Guarantor and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of the Guarantor or (2) any two Persons designated in a Guarantor Order previously delivered to the Trustee by any two of the foregoing officers and delivered to the Trustee.
 
“ Holder ” means, with respect to a particular tranche of Notes (i) for so long as the Notes of such tranche are represented by Global Notes, the bearer thereof which shall initially be the Depositary and (ii) in the event that Definitive Notes of such tranche are issued, the person in whose name a Definitive Note of such tranche is registered on the Exchange Agent’s books.
 
“ Indenture ” means this Indenture, as amended, modified or supplemented from time to time in accordance with the terms hereof, including the terms of the Notes.
 
 
-4-
 
 
“ Initial Purchasers ” means Lehman Brothers Inc., Citicorp Securities, Inc., Nationsbanc Montgomery Securities LLC and Chase Securities Inc.
 
“ Interest Payment Date ” means, with respect to a particular tranche of Notes the stated maturity of an installment of interest on the Notes of such tranche.
 
“ Issuance Date ” means the closing date for the sale and issuance of the Notes under this Indenture, which is expected to be on or about June 26, 1998.
 
“ Legal Defeasance ” shall have the meaning set forth in Section 8.2.
 
“ Maturity Date ” means July 1, 2007 with respect to the Tranche A Notes and July 1, 2028 with respect to the Tranche B Notes.
 
“ Notes ” shall have the meaning set forth in the preamble of this Indenture.
 
“ Notice of Default ” shall have the meaning set forth in Section 6.1.
 
“ Offering ” means the offering of the Notes described in the Offering Memorandum.
 
“ Offering Memorandum ” means the final offering memorandum of the Company, dated June 23, 1998 pursuant to which the Notes were sold.
 
“ Officer ” means, with respect to any Person (other than any Agent), the Chairman of the Board, the Vice Chairman of the Board, the President, any Vice President, the Treasurer or the Secretary of such Person (and with respect to the Company, a director thereof).
 
“ Officers’ Certificate ” means a certificate signed (i) in the case of the Company, on behalf of the Company by two Officers of the Company or by an Officer and an Assistant Treasurer or an Assistant Secretary and (ii) in the case of the Guarantor, on behalf of the Guarantor by two Officers of the Guarantor or by an Officer and an Assistant Treasurer or Assistant Secretary, in each case that meets the requirements of Sections 12.4 and 12.5.
 
“ Opinion of Counsel ” means a written opinion from legal counsel (including, if applicable, tax counsel) which and who are reasonably acceptable to, and addressed to, the Trustee complying with the requirements of Sections 12.4 and 12.5.  Unless otherwise required by the TIA, the legal counsel may be an employee of or counsel to the Company, the Guarantor or the Trustee.
 
“ Paying Agent ” shall have the meaning set forth in Section 2.3.
 
“ Paying Agent Agreement ” shall have the meaning set forth in Section 2.3.
 
“ Person ” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.
 
“ Place of Payment ,” when used with respect to the Notes means the place or places where the principal, premium, if any, interest and Additional Amounts, if any, on the Notes are payable, as contemplated by Section 2.3.
 
“ Principal Property ” means land, land improvements, buildings and associated factory and laboratory equipment owned or leased pursuant to a capital lease and used by the Guarantor or any Subsidiary primarily for manufacturing, assembling, processing, producing, packaging or storing its products, raw materials, inventories or other materials and supplies located in the United States and having an acquisition cost plus capitalized improvements in excess of 2% of Consolidated Net Tangible Assets as of the date of determination, but shall not include any such property financed through the issuance of tax exempt governmental obligations, or any such property that has been determined by Board Resolution of the Guarantor not to be of material importance to the respective businesses conducted by the Guarantor and its Subsidiaries taken as a whole, effective as of the date such resolution is adopted.
 
 
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“ Private Placement Legend ” means the legend initially set forth on the Notes in the form set forth on Exhibit A, B, C and D.
 
“ Record Date ” means, with respect to Definitive Notes, a particular tranche of Notes, the Record Dates specified in the Notes of such tranche.
 
“ Redemption Date ” when used with respect to any Note of a particular tranche to be redeemed, means the date fixed for such redemption pursuant to this Indenture and Paragraphs 7 and 8 of the Notes of such tranche.
 
“ Redemption Price ” when used with respect to any Note of a particular tranche to be redeemed, means the price fixed for such redemption pursuant to this Indenture and Paragraphs 7 and 8 of the Notes of such tranche, which shall include accrued and unpaid interest thereon and Additional Amounts, if any, to the Redemption Date.
 
“ Regulation S ” means Regulation S under the Securities Act.
 
“ Regulation S Certificate ” shall have the meaning set forth in Section 2.6(a)(i)(3)(a).
 
“ Regulation S Global Notes ” shall have the meaning set forth in Section 2.1.
 
“ Regulation S Notes ” shall have the meaning set forth in Section 2.1.
 
“ Release Date ” shall have the meaning set forth in Section 2.6(a)(i)(3)(a).
 
“ Restricted Period ” means the period of 40 consecutive days beginning on and including the first day after the Issuance Date.
 
“ Rule 144A ” means Rule 144A under the Securities Act.
 
“ SEC ” means the United States  Securities  and Exchange Commission.
 
“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.
 
“ Subsidiary ” means a corporation a majority of the Voting Stock of which is owned by (i) the Guarantor, (ii) the Guarantor and one or more Subsidiaries, or (iii) one or more Subsidiaries.
 
“ TIA ” means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-77bbbb), as it may be amended from time to time.
 
“ Tranche A Notes ” shall have the meaning set forth in the preamble to this Indenture.
 
“ Tranche B Notes ” shall have the meaning set forth in the preamble to this Indenture.
 
 
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“ Trust Officer ” means any officer within the corporate trust department (or any successor group of the Trustee), including any vice president,  assistant vice president,  corporate trust officer, assistant corporate trust officer, assistant secretary or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by the persons who at that time shall be such officers, and also means, with respect to a particular corporate trust matter, any other officer to whom such trust matter is referred because of his or her knowledge of and familiarity with the particular subject.
 
“ Trustee ” means the party named as such in this Indenture until a successor replaces it in accordance with the provisions of this Indenture and thereafter means such successor.
 
“ U.S. GAAP ” means generally accepted accounting principles in the United States as have been approved by a significant segment of the U.S. accounting profession, which are in effect at the time of each application for determining compliance with the covenants pursuant to Article IV.  For the purposes of this Indenture, the term “consolidated” with respect to any Person shall mean such Person consolidated with its Subsidiaries.
 
“ United States ” means the United States of America, but excluding the Commonwealth of Puerto Rico, the Virgin Islands and other territories and possessions thereof.
 
“ U.S. Global Notes ” shall have the meaning set forth in Section 2.1.
 
“ U.S. Note ” shall have the meaning set forth in Section 2.1.
 
“ U.S. Persons ” has the meaning given in Regulation S under the Securities Act.
 
“ Voting Stock ” means capital stock having voting power under ordinary circumstances to elect directors.
 
SECTION 1.2.   Incorporation by Reference of TIA .  Except as set forth in 7.6, this Indenture is subject to the mandatory provisions of the TIA which are incorporated by reference in, and made a part of, this Indenture.  The following TIA terms used in this Indenture have the following meanings:
 
“Commission” means the SEC;
 
“indenture securities” means the Notes and the Guarantees;
 
“indenture security holder” means a Holder;
 
“indenture to be qualified” means this Indenture;
 
“indenture trustee” or “institutional trustee” means the Trustee; and
 
“obligor” on the indenture securities means the Company, the Guarantor or any other obligor on the indenture securities.
 
All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule and not otherwise defined herein have the meanings assigned to them therein.
 
 
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SECTION 1.3.   Rules of Construction .  Unless the context otherwise requires:
 
(a)  a term has the meaning assigned to it;
 
(b)  an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP;
 
(c)  “or” is not exclusive;
 
(d)  words in the singular include the plural, and words in the plural include the singular;
 
(e)  provisions apply to successive events and transactions; and
 
(f)  “herein,” “hereof” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.
 
 
ARTICLE II
 
THE TRANCHE A AND TRANCHE B NOTES
 
SECTION 2.1.   Form and Dating .  The Tranche A Notes and the notation relating to the Trustee’s certificate of authentication shall be substantially in the form of Exhibits A or B, as applicable, and the Tranche B Notes and the notation relating to the Trustee’s certificate of authentication shall be substantially in the form of Exhibits C or D, as applicable.  The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage.  The Company and the Trustee shall approve the form of the Notes and any notation, legend or endorsement on them.  Each Note shall be dated the date of its issuance and shall show the date of its authentication.
 
The terms and provisions contained in the Notes, annexed hereto as Exhibits A, B, C and D shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, the Company, the Guarantor and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.  The Notes will initially be represented by the Global Notes.
 
The Tranche A Notes and Tranche B Notes, if any, offered and sold in their initial distribution in reliance on Regulation S shall be initially issued as a single note, with respect to each tranche, in global bearer form without interest coupons, substantially in the form of Exhibit A (in respect of Tranche A Notes) or Exhibit C (in respect of Tranche B Notes) hereto, with such applicable legends as are provided in Exhibit A or Exhibit C hereto, as applicable, except as otherwise permitted herein.  It is understood that such Global Notes, if any, shall be deposited initially with the Depositary pursuant to the terms of the Depositary Agreement, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  Such Global Notes shall be referred to herein as the “Regulation S Global Notes”.  The aggregate principal amount of each Regulation S Global Note may from time to time be increased or decreased by adjustments made by annotation or endorsement thereon by the Company or by the Trustee, the Depositary or a custodian of either on behalf of the Company (or by the issue of a further Regulation S Global Notes), in connection with a corresponding decrease or increase in the aggregate principal amount of the U.S. Global Note of the same tranche or in consequence of the issue of Definitive Notes or additional Regulation S Notes, as hereinafter provided.  The Regulation S Global Notes and all other Notes that are not U.S. Global Notes shall collectively be referred to herein as the “Regulation S Notes”.
 
 
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The Tranche A Notes and Tranche B Notes, if any, offered and sold in their initial distribution in reliance on Rule 144A shall be initially issued as a single note, with respect to each tranche, in global bearer form without interest coupons, substantially in the form of Exhibit A (in respect of Tranche A) or Exhibit C (in respect of Tranche B) hereto, with such applicable legends as are provided in Exhibit A and Exhibit C hereto, as applicable, except as otherwise permitted herein.  It is understood that such Global Notes, if any, shall be deposited initially with the Depositary pursuant to the terms of the Depositary Agreement, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  Such Global Notes shall be referred to herein as the “U.S. Global  Notes”.  The aggregate principal amount of each U.S. Global Note may from time to time be increased or decreased by adjustments made by annotation or endorsement thereon by the Company or by the Trustee, the Depositary or a custodian of either on behalf of the Company (or by the issue of a further U.S. Global Notes), in connection with a corresponding decrease or increase in the aggregate principal amount the Regulation S Global Note of the same tranche or in consequence of the issue of Definitive Notes or additional U.S. Notes, as hereinafter provided.  The U.S. Global Notes and all other Notes evidencing the debt, or any portion of the debt, initially evidenced by such U.S. Global Notes, other than Notes transferred or exchanged upon certification as provided in Section 2.6(a)(i)(1), (2) or (4), shall collectively be referred to herein as the “U.S. Notes.”
 
SECTION 2.2.   Execution and Authentication .  The Notes shall be executed on behalf of the Company by two Officers by manual or facsimile signature.  The Notes shall be so executed under the corporate seal (which may be in facsimile form) of the Company reproduced thereon.
 
If an Officer whose signature is on a Note was an Officer at the time of such execution but no longer holds that office or position at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.
 
A Note shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note.  The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
 
The Trustee shall authenticate Tranche A Notes for original issue in the aggregate principal amount of $150,000,000 and Tranche B Notes for an original issue in the aggregate principal amount of $150,000,000, in each case upon receipt of a Company Order and Guarantor Order, each in the form of an Officers’ Certificate.  The Officers’ Certificate shall specify the amount of Tranche A Notes and Tranche B Notes to be authenticated, the type of Notes and the date on which the Notes of each tranche are to be authenticated, whether the Notes of each tranche are to be Definitive Notes or Global Notes and whether or not the Notes of each tranche shall bear the Private Placement Legend, or such other information as the Trustee may reasonably request.  The aggregate principal amount of Tranche A Notes outstanding at any time may not exceed $150,000,000 and the aggregate principal amount of Tranche B Notes outstanding at any one time may not exceed $150,000,000 except, in each case, as provided in Section 2.7.  Upon receipt of a Company Order, the Trustee shall authenticate Notes in substitution of Notes originally issued to reflect any name change of the Company.
 
The Trustee may appoint an authenticating agent (“ Authenticating Agent ”) reasonably acceptable to the Company and the Guarantor to authenticate Notes.  Unless otherwise provided  in the appointment, an Authenticating Agent may authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such Authenticating Agent.  An Authenticating Agent has the same rights as an Agent to deal with the Company, the Guarantor and Affiliates of the Company and the Guarantor.  The Trustee hereby appoints The First National Bank of Chicago to be the Authenticating Agent on the Issuance Date.  The Notes shall be issuable only in denominations of $1,000 and any multiple thereof.  The Global Notes shall be in bearer form without coupons and the Definitive Notes shall be in registered form.
 
 
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SECTION 2.3.   Exchange Agent and Paying Agent .  The Company shall maintain (a) an office or agency in the United States, where (a) Global Notes may be presented or surrendered for transfer or for exchange pursuant to Section 2.6 (the “ Exchange Agent ”), (b) Global Notes may be presented or surrendered for payment (“ Paying Agent ”) and (c) notices and demands in respect of such Global Notes and this Indenture may be served.  In the event that Definitive Notes are issued, (x) Definitive Notes may be presented or surrendered for registration of transfer or for exchange, (y) Definitive Notes may be presented or surrendered for payment and (z) notices and demands in respect of the Definitive Notes and this Indenture may be served at an office of the Exchange Agent or the Paying Agent, as applicable, in the Borough of Manhattan, The City of New York.  In the event that Definitive Notes are issued, the Exchange Agent shall keep a register of the Notes and of their transfer and exchange.  The Company, upon notice to the Trustee, may have one or more co-Exchange Agents and one or more additional Paying Agents reasonably acceptable to the Trustee.  The term “Exchange Agent” includes any co-Exchange Agent and the term “Paying Agent” includes any additional Paying Agent.  The Company is initially appointing First Chicago Trust Company of New York as Exchange Agent and Paying Agent pursuant to the Paying Agent Agreement dated as of June 26, 1998, among the Company, the Guarantor and the Paying Agent (the “ Paying Agent Agreement ”) until such time as First Chicago Trust Company of New York has resigned or a successor has been appointed.  The Company may change any Exchange Agent or Paying Agent without notice to any Holder.  The Company may appoint the Guarantor to act as Exchange Agent or Paying Agent, except that for purposes of a redemption pursuant to paragraph 7 and 8 of the Notes, none of the Company, the Guarantor and any Affiliate of the Company or Guarantor, may act as Paying Agent.  If Definitive Notes are issued, the Company will appoint Kredietbank S.A. Luxembourgeoise, or such other Person located in Luxembourg and reasonably acceptable to the Trustee, as an additional paying and transfer agent.  Upon the issuance of Definitive Notes, Holders will be able to receive principal, premium, if any, interest and Additional Amounts, if any, on the Notes and will be able to transfer Definitive Notes at the Luxembourg office of such paying and transfer agent, subject to the right of the Company or the Guarantor to mail payments in accordance with the terms of this Indenture.  In all circumstances, the Company shall ensure that the Paying Agent shall be located outside the United Kingdom.
 
SECTION 2.4.   Paying Agent To Hold Assets in Trust .  The Company shall require each Paying Agent other than the Trustee to agree in writing that each Paying Agent shall hold in trust for the benefit of Holders or the Trustee all assets held by the Paying Agent for the payment of principal, premium, if any, interest and Additional Amounts, if any, on the Notes, and shall notify the Trustee of any Default by the Company in making any such payment.  The Company at any time may require a Paying Agent to distribute all assets held by it to the Trustee and account for any assets disbursed and the Trustee may at any time during the continuance of any payment Default, upon written request to a Paying Agent, require such Paying Agent to distribute all assets held by it to the Trustee and to account for any assets distributed.  Upon distribution to the Trustee of all assets that shall have been delivered by the Company to the Paying Agent, the Paying Agent shall have no further liability for such assets.
 
SECTION 2.5.   List of Holders .  In the event Definitive Notes are issued, the Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders.  If the Trustee is not the Exchange Agent, the Company shall furnish to the Trustee before each Record Date and at such other times as the Trustee may request in writing a list as of such date and in such form as the Trustee may reasonably require of the names and addresses of Holders, which list may be conclusively relied upon by the Trustee.
 
 
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SECTION 2.6.   Transfer and Exchange .  (a)  The following procedures and restrictions shall not apply with respect to Notes of a particular tranche transferred or exchanged for the account of a Person who is not an Affiliate of the Company at the time of the transfer or exchange and has not been an Affiliate during the preceding three months, provided a period of at least two years has elapsed since the later of the date the Notes of such tranche were acquired from the Company or from an Affiliate of the Company.
 
(i)           Notwithstanding any other provisions of this Indenture or the Notes, transfers and exchanges, of any whole or part of a Global Note of the kinds described in clauses (1), (2), (3), (4) and (5) below and exchanges of any whole or part of Global Notes or of other Notes as described in clause (6) below, shall be made only in accordance with this Section 2.6(a), and all transfers of any whole or part of Regulation S Global Notes, if any, shall comply with clause (7) below.
 
(1)   Transfers of U.S. Global Note to Regulation S Global Note During the Restricted Period .  If the Holder of a  U.S. Global Note of a particular tranche wishes at any time during the Restricted Period to transfer, in whole or in part, a portion of such Note to the applicable Regulation S Global Note, such transfer may be effected, subject to the rules and procedures of DTC, the Euroclear Operator and Cedel, to the extent applicable (the “ Applicable Procedures ”), only in accordance with the provisions of this Section 2.6(a)(i)(1).  Upon receipt by the Trustee of a certificate in substantially the form set forth in Exhibit E, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable U.S. Global Note and to increase the principal amount of the applicable Regulation S Global Note, by the principal amount of the portion of the U.S. Global Note to be so transferred, by annotation thereon.
 
(2)   Transfers of U.S. Global Note to Regulation S Global Note After the Expiration of the Restricted Period .  If the Holder of a U.S. Global Note of a particular tranche wishes at any time after the expiration of the Restricted Period to transfer, in whole or in part, a portion of such Note to the applicable Regulation S Global Note, such transfer may be effected, subject to the Applicable Procedures, only in accordance with this Section 2.6(a)(i)(2).  Upon receipt by the Trustee of a certificate in substantially the form set forth in Exhibit F, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable U.S. Global Note, and to increase the principal amount of the applicable Regulation S Global Note, by the principal amount of the portion of the U.S. Global Notes to be so transferred, by annotation thereon.
 
(3)   Transfers of Regulation S Global Note to U.S. Global Note During the Restricted Period; Transfers of Regulation S Global Note to U.S. Global Note After Restricted Period .  (a) If the Holder of a Regulation S Global Note of a particular tranche wishes at any time during the Restricted Period to transfer, in whole or in part, a portion of such Note to the applicable U.S. Global Note, such transfer may be effected, subject to the Applicable Procedures, only in accordance with this Section 2.6(a)(i)(3)(a).  Upon receipt by the Trustee with respect to a transfer of such Regulation S Global Note during the Restricted Period (but not after the expiration of the Restricted Period) of a certificate in substantially the form set forth in Exhibit G-1, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable Regulation S Global Note, and to increase the principal amount of the applicable U.S. Global Notes, by the principal amount of the portion of the Regulation S Global Note to be so transferred, by annotation thereon.
 
 
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(b)  If the Holder of a Regulation S Global Note of a particular tranche wishes at any time after the expiration of the Restricted Period to transfer, in whole or in part, a portion of such Note to the applicable U.S. Global Note, such transfer may be effected, subject to the Applicable Procedures, only in accordance with this Section 2.6(a)(i)(3)(b).  Upon receipt by the Trustee of a certificate in substantially the form set forth in Exhibit G-2, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable Regulation S Global Note, and to increase the principal amount of the applicable U.S. Global Note, by the principal amount of the portion of the Regulation S Global Note to be so transferred, by annotation thereon.
 
(4)   Exchanges of U.S. Global Note for Regulation S Global Note .  If the Holder of a U.S. Global Note of a particular tranche wishes at any time to exchange, in whole or in part, a portion of such Note to the applicable Regulation S Global Note, such exchange may be effected, subject to the Applicable Procedures, only in accordance with the provisions of this Section 2.6(a)(i)(4).  Upon receipt by the Trustee of a certificate in substantially the form set forth in Exhibit H, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable U.S. Global Note, and to increase the principal amount of the applicable Regulation S Global Note, by the principal amount of the portion of the U.S. Global Note to be so exchanged, by annotation thereon.
 
(5)   Exchanges of Regulation S Global Note for U.S Global Note .  If the Holder of a Regulation S Global Note of a particular tranche wishes at any time to exchange, in whole or in part, a portion of such Note to the applicable U.S. Global Note, such exchange may be effected, subject to the Applicable Procedures, only in accordance with the provisions of this Section 2.6(a)(i)(5).  Upon receipt by the Trustee of a certificate in substantially the form set forth in Exhibit I, the Trustee shall present the relevant Global Notes to the Company or its agent to reduce the principal amount of the applicable Regulation S Global Note, and to increase the principal amount of the applicable U.S. Global Note, by the principal amount of the portion of the Regulation S Global Note to be so exchanged, by annotation thereon.
 
(6)   Other Exchanges.   In the event that any Global Note or any portion thereof is exchanged for Notes in definitive form pursuant to Section 2.6(c) hereof, such Definitive Notes may in turn be exchanged (on transfer or otherwise) for other Definitive Notes and only in accordance with such procedures, which shall be substantially consistent with the provisions of clauses (1) through (5) above and (7) below (including the certification requirements intended to ensure that transfers and exchanges of portions of a Note comply with Rule 144A or Regulation S, as the case may be) and any Applicable Procedures, as may from time to time be adopted by the Company and the Exchange Agent.
 
(7)   Interests in Regulation S Global Note to be Held Through the Euroclear Operator or Cedel.   Until the expiration of the Restricted Period, interests in a Regulation S Global Note may be held only through the Euroclear Operator and Cedel.
 
(ii)           Each U.S. Note issued hereunder shall, upon issuance, bear the legend set forth on the form of the Note attached hereto as Exhibit A, B, C and D and such legend shall not be removed from such Note except as provided in the next sentence.  The legend required for a U.S. Note of a particular tranche may be removed from such U.S. Note if there is delivered to the Company such satisfactory evidence, which may include an opinion of independent U.S. counsel, as may be reasonably required by the Company, that neither such legend nor the restrictions on transfer set forth therein are required to ensure that transfers of such Note will not violate the registration requirements of the Securities Act.  Upon provision of such satisfactory evidence, the Trustee, at the direction of the Company, shall authenticate and deliver in exchange for such Note another Note or Notes having an equal aggregate principal amount that does not bear such legend.  If such a legend required for a U.S. Note has been removed from a U.S. Note as provided above, no other Note issued in exchange for all or any part of such Note shall bear such legend, unless the Company has reasonable cause to believe that such other Note is a “restricted security” within the meaning of Rule 144 and instructs the Trustee to cause a legend to appear thereon.
 
 
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(b)  Transfer of any Global Note shall be by delivery.  Each Global Note of a tranche authenticated under this Indenture shall be in bearer form and it is understood that such Global Note will initially be delivered to the Depositary or a nominee or custodian therefor, and each such Global Note of such tranche shall constitute a single Note for all purposes of this Indenture.
 
(c)  All Global Notes of a particular tranche shall be exchanged by the Company (with authentication by the Trustee) for one or more Definitive Notes of the same tranche free of charge, substantially in the form of Exhibit B (in respect of Tranche A Notes) or Exhibit D (in respect of Tranche B Notes), if, for such tranche of Notes, (a) DTC (i) has notified the Company that it is unwilling or unable to continue as, or ceases to be, a clearing agency registered under the Exchange Act and (ii) a successor to DTC registered as a clearing agency under the Exchange Act is not able to be appointed by the Company within 90 days of such notification, (b) for so long as the Depositary is the Holder, such circumstances as set out in Section 2.4 of the Depositary Agreement have occurred or (c) at any time at the option of the Company.  If an Event of Default with respect to a particular tranche of Notes occurs and is continuing, the Company shall, at the request of the Holder thereof, exchange all or part of a Global Note of such tranche for one or more Definitive Notes of the same tranche (with authentication by the Trustee),  substantially in the form of Exhibit B (in respect of Tranche A Notes) or Exhibit D (in respect of Tranche B Notes); provided , however , that the principal amount at maturity of such Definitive Notes and such Global Note after such exchange shall be $1,000 or multiples thereof.  Whenever all of a Global Note is exchanged for one or more Definitive Notes, it shall be surrendered by the Holder thereof to the Trustee for cancellation.  Whenever a part of a Global Note is exchanged for one or more Definitive Notes the Global Note shall be surrendered by the Holder thereof to the Trustee who shall cause an adjustment to be made to Schedule A of such Global Note such that the principal amount of such Global Note will be equal to the portion of such Global Note not exchanged and shall thereafter return such Global Note to such Holder.  All Definitive Notes issued in exchange for a Global Note or any portion thereof shall be registered in such names as the Depositary shall instruct the Trustee based on the instructions of DTC.  Every Note authenticated and delivered in exchange for or in lieu of a Global Note, or any portion thereof, pursuant to Section 2.6(a), 2.7, 2.10 or 3.7 hereof or otherwise, shall be authenticated and delivered in the form of, and shall be, a Global Note.  A Global Note may not be exchanged for a Definitive Note other than as provided in this Section 2.6(c).
 
(d)  Definitive Notes of a particular tranche shall be transferable only upon the surrender of a Definitive Note of the same tranche for registration of transfer.  When a Definitive Note is presented to the Exchange Agent or a co-Exchange Agent with a request to register a transfer, the Exchange Agent shall register the transfer as requested if its requirements for such transfers are met.  When Definitive Notes are presented to the Exchange Agent or a co-Exchange Agent with a request to exchange them for an equal principal amount of Definitive Notes of other denominations, the Exchange Agent shall make the exchange as requested if the same requirements are met.  To permit registration of transfers and exchanges, the Company and the Guarantor shall execute and the Trustee shall authenticate Definitive Notes at the Exchange Agent’s or co-Exchange Agent’s request.
 
 
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(e)  The Company shall not be required to make, and the Exchange Agent need not register transfers or exchanges of, Definitive Notes selected for redemption (except, in the case of Definitive Notes to be redeemed in part, the portion thereof not to be redeemed) for a period of 15 days before a selection of Definitive Notes to be redeemed.
 
(f)  Prior to the due presentation for registration of transfer of any Definitive Note, the Company, the Guarantor, the Trustee, the Paying Agent, the Exchange Agent or any co-Exchange Agent may deem and treat the Person in whose name a Definitive Note is registered as the absolute owner of such Definitive Note for the purpose of receiving payment of principal, premium, if any, interest and Additional Amounts, if any, on such Definitive Note and for all other purposes whatsoever, whether or not such  Definitive Note is overdue, and none of the Company, the Guarantor, the Trustee, the Paying Agent, the Exchange Agent or any co-Exchange Agent shall be affected by notice to the contrary.
 
(g)  The Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges in connection with any transfer or exchange pursuant to this Section 2.6.
 
(h)  All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture will evidence the same debt (including the Guarantee of the Guarantor) and will be entitled to the same benefits under this Indenture as the Notes surrendered upon such transfer or exchange.
 
(i)  Holders of Notes (or holders of interests therein) and prospective purchasers designated by such Holders (or holders of interests therein) will have the right to obtain from the Company and the Guarantor upon request by such Holders (or holders of interests therein) or prospective purchasers, during any period in which the Guarantor is not subject to Section 13 or 15(d) of the Exchange Act, or is exempt from reporting pursuant to 12g3-2(b) under the Exchange Act, the information required by paragraph d(4)(i) of Rule 144A in connection with any transfer or proposed transfer of such Notes.
 
SECTION 2.7.   Replacement Notes .  If a mutilated Definitive Note is surrendered to the Exchange Agent, if a mutilated Global Note is surrendered to the Company or if the Holder of a Note claims that such Note has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Note (including the Guarantor’s Guarantee) in such form as the Note being replaced if the requirements of the Trustee, the Exchange Agent, the Company and the Guarantor are met.  If required by the Trustee, the Exchange Agent, the Company or the Guarantor, such Holder must provide an indemnity bond or other indemnity, sufficient in the judgment of the Company, the Guarantor, the Exchange Agent and the Trustee, to protect the Company, the Guarantor, the Trustee and any Agent from any loss which any of them may suffer if a Note is replaced.  The Company, the Guarantor and the Trustee may charge such Holder for its reasonable, out-of-pocket expenses in replacing a Note, including reasonable fees and expenses of counsel.  Every replacement Note is an additional obligation of the Company guaranteed by the Guarantor.
 
SECTION 2.8.   Outstanding Notes .  Notes outstanding at any time of a particular tranche are all the Notes of such tranche that have been authenticated by the Trustee except those cancelled by it, those delivered to it for cancellation, those reductions in the Global Note of such tranche effected in accordance with the provisions hereof and those described in this Section as not outstanding.  Subject to Section 2.9, a Note does not cease to be outstanding because the Company, the Guarantor or any of its Affiliates holds the Note.
 
 
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If a Note is replaced pursuant to Section 2.7 (other than a mutilated Note surrendered for replacement), it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.  A mutilated Note ceases to be outstanding upon surrender of such Note and replacement thereof pursuant to Section 2.7.
 
If the principal amount of any Note is considered paid under Section 4.1 hereof, it ceases to be outstanding and interest and Additional Amounts, if any, on it cease to accrue.
 
If on a Redemption Date or the Maturity Date of a particular tranche the Paying Agent holds cash in U.S. dollars or Government Securities sufficient to pay all of the principal, premium, if any, interest and Additional Amounts, if any, due on the Notes of such tranche payable on that date, then on and after that date such Notes cease to be outstanding and interest and Additional Amounts, if any, on such Notes cease to accrue.
 
SECTION 2.9.   Treasury Notes .  In determining whether the Holders of the required principal amount of Notes of a particular tranche have concurred in any direction, waiver or consent, Notes of such tranche owned by the Company or its Affiliates shall be disregarded, except that, for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes of such tranche that the Trustee actually knows are so owned shall be disregarded.
 
The Company shall notify the Trustee, in writing, when it or any of its Affiliates repurchases or otherwise acquires Notes, of the aggregate principal amount of such Notes so repurchased or otherwise acquired.  The Trustee may require an Officers’ Certificate listing Notes owned by the Company, a Subsidiary of the Company or an Affiliate of the Company.
 
SECTION 2.10.   Temporary Notes .  Until permanent Definitive Notes of a particular tranche are ready for delivery, the Company and the Guarantor may prepare and the Trustee shall authenticate temporary Definitive Notes of such tranche upon receipt of a Company Order and Guarantor Order each in the form of an Officers’ Certificate.  Each Officers’ Certificate shall specify the amount of temporary Definitive Notes of a particular tranche to be authenticated and the date on which the temporary Definitive Notes of such tranche are to be authenticated.  Temporary Definitive Notes of a particular tranche shall be substantially in the form of permanent Definitive Notes of such tranche but may have variations that the Company or the Guarantor considers appropriate for temporary Definitive Notes of such tranche.  Without unreasonable delay, the Company and the Guarantor shall prepare and the Trustee shall authenticate upon receipt of a Company Order and Guarantor Order pursuant to Section 2.2 permanent Definitive Notes of a particular tranche in exchange for temporary Definitive Notes of such tranche.
 
SECTION 2.11.   Cancellation .  The Company at any time may deliver Notes to the Trustee for cancellation.  The Exchange Agent and the Paying Agent shall forward to the Trustee any Notes surrendered to them for transfer, exchange or payment.  The Trustee, or at the direction of the Trustee, the Exchange Agent or the Paying Agent, and no one else, shall cancel and, at the written direction of the Company, shall dispose of (subject to the record retention requirements of the Exchange Act) all Notes surrendered for transfer, exchange, payment or cancellation; provided , however , that the Trustee may, but shall not be required to, destroy such cancelled Notes.  Subject to Section 2.7, the Company may not issue new Notes to replace Notes that it has paid or delivered to the Trustee for cancellation.  If the Company shall acquire any of the Notes, such acquisition shall not operate as a redemption or satisfaction of the Debt represented by such Notes unless and until the same are surrendered to the Trustee for cancellation pursuant to this Section 2.11.
 
 
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SECTION 2.12.   Defaulted Interest .  If the Company defaults in a payment of interest on the Tranche A Notes or the Tranche B Notes, it shall pay the defaulted interest of such Notes, plus (to the extent lawful) any interest payable on the defaulted interest to the Holder thereof.  The Company shall notify the Trustee and Paying Agent in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment (a “ Default Interest Payment Date ”), and at the same time the Company shall deposit with the Trustee or Paying Agent an amount of money equal to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make arrangements satisfactory to the Trustee or Paying Agent for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such defaulted interest as in this Section 2.12; provided , however , that in no event shall the Company deposit monies proposed to be paid in respect of defaulted interest later than 11:00 a.m.  New York City time on the proposed Default Interest Payment Date.  At least 30 days before the Default Interest Payment Date, the Company shall mail to each Holder of Notes of the applicable tranche and publish in a leading newspaper having a general circulation in New York (which is expected to be the Wall Street Journal) (and so long as the Tranche A Notes or the Tranche B Notes, as applicable, are listed on the Luxembourg Stock Exchange and the rules of such Luxembourg Stock Exchange shall so require, a newspaper having a general circulation in Luxembourg (which is expected to be the Luxemburger Wort)) or, in the case of Definitive Notes of a particular tranche, mail by first-class mail to each Holder’s registered address (and, so long as the Tranche A Notes or the Tranche B Notes are listed on the Luxembourg Stock Exchange and the rules of such Stock Exchange shall so require, publish in a newspaper having a general circulation in Luxembourg (which is expected to be the Luxemburger Wort)), with a copy to the Trustee, a notice that states the Default Interest Payment Date and the amount of defaulted interest, and interest payable on such defaulted interest, if any, to be paid.
 
SECTION 2.13.   CUSIP and CINS Number .  The Company in issuing the Tranche A and the Tranche B Notes may use a “CUSIP” or “CINS” number, and if so, the Trustee shall use the CUSIP and CINS number in notices of redemption or exchange as a convenience to Holders; provided , however , that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP and CINS number printed in the notice or on the Notes, and that reliance may be placed only on the other identification numbers printed on the Notes.  The Company shall promptly notify the Trustee of any change in the CUSIP or CINS number.
 
SECTION 2.14.   Deposit of Moneys .  Prior to 11:00 a.m. New York City time on each Interest Payment Date and Maturity Date, the Company shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments, if any, due on such Interest Payment Date or Maturity Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders on such Interest Payment Date or Maturity Date, as the case may be.
 
SECTION 2.15.   Certain Matters Relating to Global Notes .
 
(a)  For the avoidance of doubt, members of, or participants in, the Depositary (“ Agent Members ”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Depositary, or the Trustee as its custodian, or under the Global Note, and the Depositary for so long as it is Holder may be treated by the Company, the Guarantor, the Trustee and any agent of the Company, the Guarantor or the Trustee as the absolute owner of the Global Note for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, the Guarantor, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Note.
 
 
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(b)  The Holder of any Global Note of a particular tranche may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Notes of that tranche.
 
 
ARTICLE III
 
REDEMPTION
 
SECTION 3.1.   Optional Redemption .  The Company may redeem all or any portion of the Notes of a particular tranche, upon the terms and at the Redemption Prices set forth in each of the Notes of that tranche.  The Guarantor may redeem all of the Notes of a particular tranche upon the terms and at the Redemption Prices set forth in the Notes of that tranche.  Any redemption pursuant to this Section 3.1 shall be made pursuant to the provisions of this Article III.
 
SECTION 3.2.   Election to Redeem; Notice to Trustee .  The election of the Company or the Guarantor to redeem any Notes of a particular tranche shall be evidenced by or pursuant to a Board Resolution.  In case of any redemption at the election of the Company of less than all of the Notes of a particular tranche, the Company shall, at least 60 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee) notify the Trustee by Company Order of such Redemption Date, the Redemption Price (or if the Redemption Price is not calculable at such time, the formula for calculating such price) and of the principal amount of Notes of such tranche to be redeemed and shall deliver to the Trustee such documentation and records as shall enable such Trustee to select the Notes of such tranche to be redeemed pursuant to Section 3.3; provided , however , that if the Redemption Price is not calculable at the time such notice is sent, the Company shall notify the Trustee promptly at such time such Redemption Price is calculable.  In any case of redemption of Notes of a particular tranche pursuant to Section 8 of the Notes of such tranche, prior to any Notice of redemption given pursuant to Section 3.4, the Company or the Guarantor, as the case may be, shall deliver to the Trustee an opinion of tax counsel reasonably satisfactory to the Trustee to the effect that the circumstances referred to in Section 8 in such Note exist.
 
SECTION 3.3.   Selection by Trustee of Notes to Be Redeemed .  If less than all the Notes of a particular tranche are to be redeemed, the Trustee may select the particular Notes of such tranche to be redeemed not more than 60 days prior to the Redemption Date for such Notes, from the outstanding Notes of such tranche not previously called for redemption, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for such Notes, or any multiple thereof) of the principal amount of Notes of such tranche of a denomination larger than the minimum authorized denomination for such Notes.
 
The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of  any Notes selected for partial redemption, the principal amount thereof to be redeemed.
 
For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Notes of a particular tranche shall relate, in the case of any Note of a particular tranche redeemed or to be redeemed only in part, to the portion of the principal amount of such Notes which has been or is to be redeemed.
 
SECTION 3.4.   Notice of Redemption .  Notice of redemption of a particular tranche of Notes shall be mailed to the Holders by first-class mail and given in the manner provided in Section 12.3 not later than the thirtieth day and not earlier than the sixtieth day prior to the Redemption Date, to each Holder of Notes of the relevant tranche to be redeemed.
 
 
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All notices of redemption shall state:
 
(a)  the Redemption Date;
 
(b)  the Redemption Price if such price is calculable at the time such notice is sent or, if not, the formula for calculating such price; provided , however , that notice of the Redemption Price shall be mailed to the Holders by first-class mail and given in the manner provided in Section 12.3 promptly after such price is calculable;
 
(c)  if less than all outstanding Notes of a particular tranche are to be redeemed, the identification (and, in the case of partial redemption, the respective principal amounts) of the particular Notes such tranche to be redeemed;
 
(d)  the place or places where such Notes are to be surrendered for payment of the Redemption Price;
 
(e)  the name and address of the Paying Agent;
 
(f)  that Notes of a particular tranche called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued and unpaid interest, if any, and Additional Amounts, if any;
 
(g)  that, unless the Company or the Guarantor defaults in making the redemption payment, interest and Additional Amounts, if any, on Notes of a particular tranche called for redemption ceases to accrue on and after the Redemption Date, and the only remaining right of the Holders of such Notes of such tranche is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Notes of such tranche redeemed;
 
(h)  (i) if any Global Note of a particular tranche is being redeemed in part, the portion of the principal amount of such Note of such tranche to be redeemed and that, after the Redemption Date, interest and Additional Amounts, if any, shall cease to accrue on the portion called for redemption, and upon surrender of such Global Note of such tranche, the Global Note of such tranche with a notation on Schedule A thereof adjusting the principal amount thereof to be equal to the unredeemed portion, will be returned and (ii) if any Definitive Note of a particular tranche is being redeemed in part, the portion of the principal amount of such Note of such tranche to be redeemed, and that, after the Redemption Date, upon surrender of such Definitive Note of such tranche, a new Definitive Note or Notes of such tranche in aggregate principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof, upon cancellation of the original Note of such tranche;
 
(i)  the paragraph of the Notes pursuant to which the Notes of a particular tranche are to be redeemed; and
 
(j)  the CUSIP or CINS number, and that no representation is made as to the correctness or accuracy of the CUSIP or CINS number, if any, listed in such notice or printed on the Notes of such tranche.
 
 
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If at the time a notice of redemption is being made to Holders of Notes of a particular tranche pursuant to this Section 3.4, Notes of such tranche are listed on the Luxembourg Stock Exchange, and so long as the rules of the Luxembourg Stock Exchange so require, the Company or the Guarantor, as the case may be, shall also cause a notice of redemption to be published in a leading daily newspaper of general circulation in Luxembourg (which is expected to be the Luxemburger Wort), at least 30 days but not more than 60 days before the Redemption Date.
 
SECTION 3.5.   Effect of Notice of Redemption .  Once notice of redemption is given in accordance with Section 3.4, Notes of a particular tranche called for redemption become due and payable on the Redemption Date and at the Redemption Price.  Upon surrender to the Trustee or Paying Agent, such Notes of such tranche called for redemption shall be paid at the Redemption Price, but installments of interest, the maturity of which is on or prior to the Redemption Date, shall be payable to Holders on the relevant Interest Payment Date, or, in the case of Definitive Notes, Holders of record at the close of business on the relevant Record Dates.
 
SECTION 3.6.   Deposit of Redemption Price .  Prior to 11:00 a.m. New York City time on the Redemption Date, the Company or the Guarantor, as the case may be, shall deposit with the Paying Agent, in immediately available funds, U.S. dollars sufficient to pay the Redemption Price of all Notes of a particular tranche to be redeemed on that date.  The Paying Agent shall promptly return to the Company or the Guarantor, as the case may be, any cash in U.S. dollars so deposited which is not required for that purpose upon the written request of the Company or the Guarantor, as the case may be.
 
If the Company or the Guarantor, as the case may be, complies with the preceding paragraph, then, unless the Company or the Guarantor defaults in the payment of such Redemption Price on the Notes of a particular tranche to be redeemed will cease to accrue on and after the applicable Redemption Date, whether or not such Notes of such tranche are presented for payment.  With respect to Definitive Notes of a particular tranche, if a Definitive Note of such tranche is redeemed on or after an interest Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest and Additional Amounts, if any, shall be paid to the Person in whose name such Note of such tranche was registered at the close of business on such Record Date.  If any Note of a particular tranche called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company or the Guarantor to comply with the preceding paragraph, interest and Additional Amounts, if any, shall be paid on the unpaid principal (or premium, if any), from the Redemption Date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.1.
 
SECTION 3.7.   Notes Redeemed in Part .  Upon surrender and cancellation of a Definitive Note of a particular tranche that is redeemed in part, the Company and the Guarantor shall execute and the Trustee shall authenticate for the Holder (at the Company’s expense) a new Definitive Note of such tranche equal in principal amount to the unredeemed portion of the Definitive Note surrendered and cancelled; provided , however , that each such Definitive Note shall be in a principal amount at maturity of $1,000 or a multiple thereof.  Upon surrender of a Global Note of a particular tranche that is redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on Schedule A thereof to reduce the principal amount of such Global Note to an amount equal to the unredeemed portion of the Global Note surrendered; provided , however , that each such Global Note shall be in a principal amount at maturity of $1,000 or a multiple thereof.
 
SECTION 3.8.   Applicability of This Article .  Redemption of Notes of a particular tranche as permitted or required by any form of Note of such tranche issued pursuant to this Indenture shall be made in accordance with such form of Note and this Article, provided , however , that if any provision of any such form of Note shall conflict with any provision of this Article, the provision of such form of Note shall govern.
 
 
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ARTICLE IV
 
COVENANTS
 
SECTION 4.1.   Payment of Notes .  The Company shall promptly pay the principal, premium, if any, interest and Additional Amounts, if any, on the Tranche A Notes on the dates and in the manner provided in the Tranche A Notes.  The Company shall promptly pay the principal, premium, if any, interest and Additional Amounts, if any, on the Tranche B Notes on the dates and in the manner provided in the Tranche B Notes.  Except in the case that the Guarantor or any Affiliate of the Guarantor is the Paying Agent, the Company may satisfy its obligations under the preceding sentences by making payment to the Paying Agent.
 
To the extent lawful, the Company or the Guarantor shall pay interest on overdue principal at the rate borne by the Tranche A Notes and shall pay interest on overdue installments of interest at the same rate.  Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months and, in the case of an incomplete month, the number of days elapsed, the amount of interest payable on the Tranche A Notes for any period to be equal to the product of (i) the principal amount of the Tranche A Notes outstanding during such period, (ii) the stated rate of interest per annum (expressed as a decimal fraction) payable on the Tranche A Notes and (iii) a fraction, the numerator of which is the total number of full months elapsed in such period multiplied by 30, plus the number of days in an incomplete month during which such Tranche A Notes were outstanding, and the denominator of which is 360.
 
To the extent lawful, the Company or the Guarantor shall pay interest on overdue principal at the rate borne by the Tranche B Notes and shall pay interest on overdue installments of interest at the same rate.  Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months and, in the case of an incomplete month, the number of days elapsed, the amount of interest payable on the Tranche B Notes for any period to be equal to the product of (i) the principal amount of the Tranche B Notes outstanding during such period, (ii) the stated rate of interest per annum (expressed as a decimal fraction) payable on the Tranche B Notes and (iii) a fraction, the numerator of which is the total number of full months elapsed in such period multiplied by 30, plus the number of days in an incomplete month during which such Tranche B Notes were outstanding, and the denominator of which is 360.
 
SECTION 4.2.   Maintenance of Office or Agency .  The Company shall maintain the office or agency (which office may be an office of the Trustee or an affiliate of the Trustee, Exchange Agent or co-Exchange Agent) required under Section 2.3 where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served.  The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 12.2.
 
 
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SECTION 4.3.   Limitation on Liens .  (a)  The Guarantor will not, and will not permit any Subsidiary to, directly or indirectly, as security for any Debt, mortgage, pledge or create or permit to exist any lien on any shares of stock, indebtedness or other obligations of a Subsidiary or any Principal Property, whether such shares of stock, indebtedness or other obligations of a Subsidiary or Principal Property are owned at the date of this Indenture or hereafter acquired, unless the Company or the Guarantor secures or causes to be secured any outstanding Notes equally and ratably with all Debt secured by such mortgage, pledge or lien, so long as that Debt shall be secured; provided , however , that this covenant shall not apply in the case of (i) the creation of any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired (including acquisitions by way of merger or consolidation) by the Guarantor or a Subsidiary contemporaneously with such acquisition, or within 120 days thereafter, to secure or provide for the payment or financing of any part of the purchase price thereof, or the assumption of any mortgage, pledge or other lien upon any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property hereafter acquired existing at the time of such acquisition, or the acquisition of any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property subject to any mortgage, pledge or other lien without the assumption thereof, provided that any mortgage, pledge or lien referred to in this clause (i) shall attach only to the shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property so acquired and fixed improvements thereon; (ii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property existing on the date that the Notes are first issued; (iii) any mortgage, pledge or other lien on any shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property in favor of the Company, the Guarantor or any other Subsidiary; (iv) any mortgage, pledge or other lien on a Principal Property being constructed or improved securing Debt incurred to finance the construction or improvements; (v) any mortgage, pledge or other lien on shares of stock, indebtedness or other obligations of a Subsidiary or a Principal Property incurred in connection with the issuance by a state or political subdivision thereof of any securities the interest on which is exempt from Federal income taxes by virtue of Section 103 of the United States Internal Revenue Code of 1986, as amended, or any other laws and regulations in effect at the time of such issuance; and (vi) any renewal of or substitution for any mortgage, pledge or other lien permitted by any of the preceding clauses (i) through (v), provided, in the case of a mortgage, pledge or other lien permitted under clause (i), (ii) or (iv), the Debt secured is not increased nor the line extended to any additional assets.
 
(b)  Notwithstanding the provisions of paragraph (a) of this Section 4.3, the Guarantor or any Subsidiary may create or assume liens in addition to those permitted by paragraph (a) of this Section 4.3, and renew, extend or replace such liens, provided , that at the time of such creation, assumption, renewal, extension or replacement, and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 4.4.   Limitation on Sale-Leaseback Transactions .  (a)  The Guarantor will not, and will not permit, any Subsidiary to, sell or transfer, directly or indirectly, except to the Guarantor or a Subsidiary, a Principal Property as an entirety, or any substantial portion thereof, with the intention of taking back a lease of all or part of such property except a lease for a period of three years or less at the end of which it is intended that the use of such property by the lessee will be discontinued; provided that, notwithstanding the foregoing, the Guarantor or any Subsidiary may sell a Principal Property and lease it back for a longer period (i) if the Guarantor or such Subsidiary would be entitled, pursuant to the provisions of Section 4.3(a), to create a mortgage on the property to be leased securing Debt in an amount equal to the Attributable Debt with respect to the sale and lease-back transaction without equally and ratably securing the outstanding Notes or (ii) if (A) the Guarantor promptly informs the Trustee of such transactions, (B) the net proceeds of such transactions are at least equal to the fair value (as determined by a Board Resolution) of such property and (C) the Guarantor causes an amount equal to the net proceeds of the sale to be applied to the retirement (whether by redemption, cancellation after open-market purchases, or otherwise), within 120 days after receipt of such proceeds, of Funded Debt and having an outstanding principal amount equal to the net proceeds.
 
 
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(b)  Notwithstanding the provisions of paragraph (a) of this Section 4.4, the Guarantor or any Subsidiary may enter into sale and lease-back transactions in addition to those permitted by paragraph (a) of this Section 4.4 and without any obligation to retire any outstanding Funded Debt, provided that at the time of entering into such sale and lease-back transactions and after giving effect thereto, Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
 
SECTION 4.5.   No Lien Created, etc .  This Indenture and the Notes do not create a lien, charge or encumbrances on any property of the Company, the Guarantor or any Subsidiary.
 
SECTION 4.6.   Compliance Certificate; Notice of Default .  (a)  The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers’ Certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company stating whether or not the signers know of any Default or Event of Default.  If they know of a Default or Event of Default, the certificate shall describe the Default or Event of Default.  The certificate need not comply with Section 12.4
 
(b)  The Guarantor shall deliver to the Trustee within 120 days after the end of each fiscal year of the Guarantor an Officers’ Certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Guarantor stating whether or not the signers know of any Default or Event of Default.  If they know of a Default or Event of Default, the certificate shall describe the Default or Event of Default.  The certificate need not comply with Section 12.4.
 
SECTION 4.7.   Reports .  (a)  The Company shall comply with the provisions of Section 314(c) of the TIA.
 
(b)  The Guarantor shall file with the Trustee within 15 days after it files them with the Commission copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may by rules and regulations prescribe) which the Guarantor is required to file with the Commission pursuant to Sections 13 or 15(d) of the Securities Exchange Act of 1934.  The Guarantor also shall comply with the other provisions of Section 314(a) of the Trust Indenture Act.
 
(c)  Such reports shall be delivered to the Exchange Agent and, after the issuance of Definitive Notes, the Exchange Agent will mail them at the Company’s expense to the Holders at their addresses appearing in the register of Notes maintained by the Exchange Agent.
 
SECTION 4.8.   Payment of Certain Non-Income Taxes and Similar Charges .  The Company will pay any present or future stamp, court or documentary taxes, or any other excise or property taxes, charges or similar levies which arise in any jurisdiction from the execution, delivery or registration of the Notes or any other document or instrument referred to therein, or the receipt of any payments with respect to the Notes, excluding any such taxes, charges or similar levies imposed by any jurisdiction outside the United Kingdom, the United States of America or any jurisdiction in which a Paying Agent is located, other than those resulting from, or required to be paid in connection with, the enforcement of the Notes of a particular tranche or any other such document or instrument following the occurrence of any Event of Default with respect to the Notes of such tranche.
 
 
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ARTICLE V
 
MERGER, CONSOLIDATION OR SALE BY
THE COMPANY AND THE GUARANTOR
 
SECTION 5.1.   Merger, Consolidation or Sale of All or Substantially All Assets of the Company .  The Company shall not consolidate with or merge into, or transfer, directly or indirectly, all or substantially all of its assets to another corporation or other Person unless (1) the resulting, surviving or transferee corporation or other Person assumes by supplemental indenture all the obligations of the Company under the Notes and this Indenture, (2) immediately after giving effect to such transaction, no Event of Default and no circumstances that, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing, and (3) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture comply with this Indenture, and thereafter all such obligations of the Company shall terminate.
 
SECTION 5.2.   Merger, Consolidation or Sale of All or Substantially All Assets of the Guarantor .  The Guarantor shall not consolidate with or merge into, or transfer, directly or indirectly, all or substantially all of its assets to another corporation or other Person unless (1) the resulting, surviving or transferee corporation or other Person assumes by supplemental indenture all the obligations of the Guarantor under the Notes and this Indenture, (2) immediately after giving effect to such transaction, no Event of Default and no circumstances that, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing, and (3) the Guarantor shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture comply with this Indenture, and thereafter all such obligations of the Guarantor shall terminate.
 
 
ARTICLE VI
 
DEFAULT AND REMEDIES
 
SECTION 6.1.   Events of Default .  An “Event of Default” occurs with respect to the Notes of a particular tranche if:
 
(a)  the Company or the Guarantor defaults in the payment of interest or Additional Amounts, if any, on any Note of such tranche, when the same becomes due and payable and the default continues for a period of 30 days;
 
(b)  the Company or the Guarantor defaults in the payment of the principal of (or premium on, if any) any Note of such tranche when the same becomes due and payable at maturity, upon redemption or otherwise;
 
(c)  the Company or the Guarantor fails to comply with any of its other agreements in the Notes of such tranche or this Indenture for the benefit of such tranche and the default continues for the period and after the notice specified in this Section;
 
(d)  the Company, the Guarantor or any Subsidiary fails to pay, in accordance with its terms and when payable, any of the principal, premium, if any, interest or additional amounts, if any, on any Debt (including any tranche of Notes other than the tranche or tranches, if any, with respect to which the failure to pay principal, premium, if any, interest or Additional Amounts is also an “Event of Default” under Section 6.1(a) and/or 6.1(b) above) having, in the aggregate, a then outstanding principal amount in excess of $20,000,000 or the maturity of any Debt in such amount shall have been accelerated by any holder or holders thereof or any trustee or agent acting on behalf of such holder or holders, or any Debt in such amount shall have been required by such holder, holders, trustee or agent to be prepaid prior to the stated maturity thereof, in accordance with the provisions of any contract evidencing, providing for the creation of or concerning such Debt;
 
 
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(e)  the Company or the Guarantor pursuant to or within the meaning of any Bankruptcy Law:
 
(1)  commences a voluntary case,
 
(2)  consents to the entry of an order for relief against it in an involuntary case,
 
(3)  consents to the appointment of a Custodian of it or for all or substantially all of its property,
 
(4)  makes a general assignment for the benefit of its creditors, or
 
(5)  ceases or suspends generally payments of its debts or announces an intention so to do or is (or is deemed for the purposes of any law applicable to it to be) unable to pay its debts as they fall due, or makes a general assignment for the benefit of or a composition with its creditors generally or a moratorium is declared in respect of any of its indebtedness;
 
(f)  a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
 
(6)  is for relief against the Company or the Guarantor in an involuntary case,
 
(7)  appoints a Custodian of the Company or of the Guarantor or for all or substantially all of the Company’s or Guarantor’s property, as the case may be,
 
(8)  orders the winding up or liquidation of the Company or the Guarantor, or
 
(9)  orders any execution of distress in respect of any material liability to be levied against the Company or the Guarantor or an encumbrancer takes possession of the whole or any material part of, the property, undertaking, or assets of the Company or the Guarantor,
 
and the order or decree remains unstayed and in effect for 60 days; or
 
(g)  the Guarantee with respect to such tranche of Notes ceases to be in full force and effect or the Guarantor denies or disaffirms its obligations under such Guarantee.
 
The term “Bankruptcy Law” means Title 11, United States Code or any similar Federal or state law for the relief of debtors and the U.K. Insolvency Act 1986 as supplemented or amended together with all rules, regulations and instruments made thereunder and applicable United Kingdom law relating to bankruptcy, insolvency, winding up, administration, receivership and other similar matters.  The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
 
 
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A default under clause (c) is not an Event of Default with respect to the Notes of a particular tranche until the Trustee or the Holders of at least 25% in principal amount of all the Notes of such tranche notify the Company or the Guarantor (and the Trustee if such notice is given by Holders) of the default and the Company or the Guarantor, as the case may be, does not cure the default within 30 days after receipt of the notice.  The notice must specify the default, demand that it be remedied and state that the notice is a “Notice of Default.” Subject to the provisions of Article VII, the Trustee shall not be charged with knowledge of any default unless written notice thereof shall have been given to the Trustee by the Company, the Guarantor, the Paying Agent, the Holder of a Note of the applicable tranche or an agent of such Holder.
 
SECTION 6.2.   Acceleration .  If an Event of Default with respect to the Notes of a particular tranche occurs and is continuing, the Trustee by notice to the Company and the Guarantor or the Holders of at least 25% in principal amount of the Notes of such tranche, by notice to the Company, the Guarantor and the Trustee, may declare the principal, premium, if any, accrued interest and Additional Amounts, if any, on all the Notes of such tranche to be due and payable immediately.  Upon a declaration such principal, premium, if any, interest and Additional Amounts, if any, shall be due and payable immediately.  The Holders of a majority in principal amount of the Notes of a particular tranche by notice to the Trustee may rescind an acceleration (and upon such rescission any past Event of Default caused by such acceleration shall be deemed cured) with respect to the Notes of such tranche and its consequences if all existing Events of Default with respect to the Notes of such tranche have been cured or waived, if the rescission would not conflict with any judgment or decree, and if all payments due to the Trustee and any predecessor Trustee under Section 7.7 have been made.  No such rescission shall affect any subsequent Default or impair any rights consequent thereto.
 
SECTION 6.3.   Other Remedies .  If an Event of Default with respect to the Notes of a particular tranche occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal, premium, if any, interest and Additional Amounts, if any, on the Notes of such tranche or to enforce the performance of any provision of such Notes, the applicable Guarantees or this Indenture.
 
The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative to the extent permitted by law.
 
SECTION 6.4.   Waiver of Past Defaults .  The Holders of a majority in principal amount of the Notes of a particular tranche by notice to the Trustee may waive an existing Default or Event of Default with respect to the Notes of such tranche and its consequences.  When a Default or Event of Default is waived, it is cured and stops continuing, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereto.
 
SECTION 6.5.   Control by Majority .  The Holders of a majority in principal amount of the Notes of a particular tranche may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on it with respect to the Notes of such tranche.  However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, or, subject to Section 7.1, that the Trustee determines is unduly prejudicial to the rights of other Holders of the Notes of the same tranche or would involve the Trustee in personal liability.
 
SECTION 6.6.   Limitation on Suits .  No Holder of a Note of a particular tranche may pursue any remedy with respect to this Indenture or the Notes of such tranche unless:
 
 
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(a)  the Holder gives to the Trustee written notice stating that an Event of Default with respect to the Notes of such tranche is continuing;
 
(b)  the Holders of at least 25% in principal amount of the Notes of such tranche make a written request to the Trustee to pursue the remedy;
 
(c)  such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;
 
(d)  the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and
 
(e)  during such 60-day period the Holders of a majority in principal amount of the Notes of such tranche do not give the Trustee a direction inconsistent with the request.
 
A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over the other Holder.
 
SECTION 6.7.   Rights of Holders to Receive Payment .  Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal, premium, if any, interest and Additional Amounts, if any, on the Notes, on or after the respective due dates expressed in the Notes, or to bring suit for the enforcement of any such payment on or after such respective date, shall not be impaired or affected without the consent of the Holder.
 
SECTION 6.8.   Collection Suit by Trustee .  If an Event of Default in payment of principal, premium, if any, interest or Additional Amounts, if any, specified in Section 6.1(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or the Guarantor for the whole amount of principal, premium, if any, interest and Additional Amounts, if any, remaining unpaid.
 
SECTION 6.9.   Trustee May File Proofs of Claim .  The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Holders allowed in any judicial proceedings relative to the Company or the Guarantor, its creditors or its property, and unless prohibited by law or applicable regulations, may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions.
 
SECTION 6.10.   Priorities .  If the Trustee collects any money pursuant to this Article with respect to the Notes of a particular tranche, it shall pay out the money in the following order:
 
First : to the Trustee for amounts due under Section 7.7.
 
Second : to the Holders of Notes of such tranche for amounts due and unpaid on such Notes for principal, premium, if any, interest and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on such Notes for principal, premium, if any, interest and Additional Amounts, if any, respectively; and
 
Third : to the Company or the Guarantor, as applicable.
 
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section.
 
 
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SECTION 6.11.   Undertaking for Costs .  In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit other than the Trustee of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit including the Trustee, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7 or a suit by Holders of more than 10% in principal amount of the Notes.
 
 
ARTICLE VII
 
TRUSTEE
 
SECTION 7.1.   Duties of Trustee .  (a)  If an Event of Default with respect to a particular tranche of Notes known to the Trustee has occurred and is continuing, the Trustee shall, on behalf of the Holders of the Notes of such tranche, exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.  Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under this Indenture at the request of any of the Holders of Notes, unless they shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
 
(b)  Except during the continuance of an Event of Default with respect to a particular tranche of Notes known to the Trustee:
 
(i)           The Trustee and the Agents will perform only those duties as are specifically set forth herein and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee or the Agents.
 
(ii)          In the absence of bad faith on their part, the Trustee and the Agents may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions and such other documents delivered to them pursuant to Section 12.4 hereof furnished to the Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates or opinions which by any provision hereof are required to be furnished to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture.
 
(c)  The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
 
(i)           This paragraph does not limit the effect of paragraph (b) of this Section 7.1.
 
(ii)          Neither the Trustee nor any Agent shall be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee or such Agent was negligent in ascertaining the pertinent facts.
 
(iii)         The Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority in principal amount of the outstanding Notes of a particular tranche relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to such Notes; and
 
 
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(d)  No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or to take or omit to take any action under this Indenture or take any action at the request or direction of Holders if it shall have reasonable grounds for believing that repayment of such funds is not assured to it or it does not receive an indemnity satisfactory to it in its sole discretion against such risk, liability, loss, fee or expense which might be incurred by it in compliance with such request or direction.
 
(e)  Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.1.
 
(f)  The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company or the Guarantor.  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
 
(g)  Any provision hereof relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.1 and, upon qualification of this Indenture under the TIA, the TIA.
 
SECTION 7.2.   Rights of Trustee, Subject to Section 7.1 :
 
(a)  The Trustee and each Agent may rely conclusively on and shall be protected from acting or refraining from acting based upon any document believed by them to be genuine and to have been signed or presented by the proper person.  Neither the Trustee nor any Agent shall be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent order, approval, appraisal, bond, debenture, note, coupon, security or other paper or document, but the Trustee or its Agent, as the case may be, in its discretion, may make reasonable further inquiry or investigation into such facts or matters stated in such document and if the Trustee or its Agent as the case may be, shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company and the Guarantor, at reasonable times during normal business hours, personally or by agent or attorney;
 
(b)  any request, direction, order or demand of the Company or Guarantor mentioned herein shall be sufficiently evidenced by (i) a Company Order or Guarantor Order, as the case may be, or an Officers’ Certificate and (ii) any resolution of the Board of Directors of the Company or Guarantor may be sufficiently evidenced by a Board Resolution;
 
(c)  before the Trustee acts or refrains from acting, it may require, in the absence of bad faith, an Officers’ Certificate or an Opinion of Counsel or both, which shall conform to the provisions of Sections 12.4 and 12.5.  Neither the Trustee  nor any Agent shall be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion;
 
(d)  The Trustee and any Agent may act through their attorneys and agents and shall not be responsible for the misconduct or negligence of any agent (other than an agent who is an employee of the Trustee or such Agent) appointed with due care.
 
(e)  The Trustee shall not be liable for any action it takes or omits to take in good faith which it reasonably believes to be authorized or within its rights or powers conferred upon it by this Indenture; provided , however , that the Trustee’s conduct does not constitute willful misconduct, negligence or bad faith.
 
 
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(f)  The Trustee or any Agent may consult with counsel of its selection and the advice or opinion of such counsel or any Opinion of Counsel as to matters of law shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
 
(g)  Subject to Section 9.2 hereof, the Trustee may (but shall not be obligated to), without the consent of the Holders, give any consent, waiver or approval required by the terms hereof, but shall not without the consent of the Holders of not less than a majority in aggregate principal amount of the Notes of a particular tranche at the time outstanding (i) give any consent, waiver or approval or (ii) agree to any amendment or modification of this Indenture, in each case, that shall have a material adverse effect on the interests of any Holder of Notes of such tranche.  The Trustee shall be entitled to request and conclusively rely on an Opinion of Counsel with respect to whether any consent, waiver, approval, amendment or modification shall have a material adverse effect on the interests of any Holder of Notes of a particular tranche.
 
(h)  The Trustee shall not be charged with knowledge of any Event of Default with respect to the Notes of a particular tranche unless either (1) a Trust Officer shall have actual knowledge of such Event of Default or (2) written notice of such Event of Default shall have been given to the Trustee by the Company, the Guarantor or any other obligor on the Notes of such tranche or by any Holder of the Notes of such tranche.
 
(i)  The Trustee shall have no duties or responsibilities with respect to and shall have no liability for the actions taken or the failures to act of any other Trustees appointed hereunder.
 
SECTION 7.3.   Individual Rights of Trustee .  The Trustee in its individual or any other capacity may, subject to Sections 7.10 and 7.11, become the owner or pledgee of Notes and may otherwise deal with the Company, the Guarantor, its Subsidiaries, or their respective Affiliates with the same rights it would have if it were not Trustee.  However, in the event that the Trustee acquires any conflicting interest, as defined by Section 310(b) of the TIA, it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee or resign.  Any Agent may do the same with like rights.
 
SECTION 7.4.   Trustee’s Disclaimer .  The Trustee and the Agents shall not be responsible for and make no representation as to the validity, effectiveness or adequacy of this Indenture or the Notes; it shall not be accountable for the Company’s use of the proceeds from the Notes or any money paid to the Company or upon the Company’s direction under any provision hereof, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee and it shall not be responsible for any statement or recital herein of the Company or the Guarantor, the Offering Memorandum or any other document issued in connection with the sale of Notes or any statement in the Notes other than the Trustee’s certificate of authentication.
 
SECTION 7.5.   Notice of Default .  (a)  If a Default or an Event of Default with respect to a particular tranche of Notes occurs and is continuing and the Trustee receives actual notice of such event, the Trustee shall mail to each Holder of Notes of such tranche, as their names and addresses appear on the list of Holders described in Section 2.5, notice of the uncured Default or Event of Default within 90 days after the Trustee receives such notice.  Except in the case of a Default or Event of Default in payment of principal, premium, if any, interest or Additional Amounts, if any, on any Note of a particular tranche, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interest of the Holders of Notes of such tranche, and provided , further , that in the case of any default of the character specified in Section 6.1(c) no such notice to Holders shall be given until at least 60 days after the occurrence thereof.  For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to the Notes.
 
 
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SECTION 7.6.   Report by Trustee to Holders .  This Section 7.6 shall not be operative as a part of this Indenture until this Indenture is qualified under the TIA, and, until such qualification, this Indenture shall be construed as if this Section 7.6 were not contained herein.
 
Within 60 days after each May 15 beginning with May 15, 1999, the Trustee shall, to the extent that any of the events described in TIA Section 313(a) occurred within the previous twelve months, but not otherwise, mail to each Holder a brief report dated as of such date that complies with TIA Section 313(a).  The Trustee also shall comply with TIA Sections 313(b), 313(c) and 313(d).
 
A copy of each report at the time of its mailing to Holders shall be mailed to the Company and the Guarantor and filed with the SEC and each securities exchange, if any, on which the Notes of a particular tranche are listed.
 
The Company shall promptly notify the Trustee if the Notes of a particular tranche become listed on any securities exchange or of any delisting thereof.
 
SECTION 7.7.   Compensation and Indemnity .  The Company shall pay to the Trustee from time to time such compensation as the Company and the Trustee shall from time to time agree in writing for its acceptance of this Indenture and services hereunder.  The Trustee’s and the Agents’ compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Company shall reimburse the Trustee upon request for all reasonable disbursements, expenses and advances (including reasonable fees and expenses of counsel) incurred or made by it in addition to the compensation for their services, except any such disbursements, expenses and advances as may be attributable to the Trustee’s or any Agent’s negligence or bad faith.  Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s and Agents’ accountants, experts and counsel and any taxes or other expenses incurred by a trust created pursuant to Section 8.4 hereof.
 
The Company shall indemnify each of the Trustees, any predecessor Trustee and the Agents for, and hold them harmless against, any and all loss, damage, claim, expense or liability including taxes (other than taxes based on the income of the Trustee) incurred by the Trustee or an Agent without negligence, willful misconduct or bad faith on its part in connection with acceptance of administration of this trust and its duties under this Indenture, including the reasonable expenses and attorneys’ fees and expenses of defending itself against any claim of liability arising hereunder.  The Trustee and the Agents shall notify the Company promptly of any claim asserted against the Trustee or such Agent for which it may seek indemnity.  However, the failure by the Trustee or the Agent to so notify the Company shall not relieve the Company of its obligations hereunder.  The Company shall defend the claim and the Trustee or such Agent shall cooperate in the defense (and may employ its own counsel) at the Company’s expense.  The Trustee or such Agent may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel.  The Company need not pay for any settlement made without its written consent, which consent shall not be unreasonably withheld.  The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee or such Agent as a result of the violation of this Indenture by the Trustee or such Agent if such violation arose from the Trustee’s or such Agent’s negligence or bad faith.
 
 
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To secure the Company’s payment obligations in this Section 7.7, the Trustee and the Agents shall have a senior lien prior to the Notes against all money or property held or collected by the Trustee and the Agents, in its capacity as Trustee or Agent, except money or property held in trust to pay principal, premium, if any, interest or Additional Amounts, if any, on particular Notes.
 
When the Trustee or an Agent incurs expenses or renders services after an Event of Default specified in Section 6.1(e) or (f) occurs, the expenses (including the reasonable fees and expenses of its agents and counsel) and the compensation for the services shall be preferred over the status of the Holders in a proceeding under any Bankruptcy Law and are intended to constitute expenses of administration under any Bankruptcy Law.  The Company’s obligations under this Section 7.7 and any claim or lien arising hereunder shall survive the resignation or removal of any Trustee or Agent, the discharge of the Company’s obligations pursuant to Article VIII and any rejection or termination under any Bankruptcy Law.
 
SECTION 7.8.   Replacement of Trustee .  The Trustee may resign as Trustee on behalf of the Holders of Notes of a particular tranche at any time by so notifying the Company and the Guarantor in writing.  The Holders of a majority in principal amount of the outstanding Notes of a particular tranche may remove the Trustee as Trustee on behalf of Holders of Notes of such tranche by so notifying the Company, the Guarantor and the Trustee in writing and may appoint a successor trustee with the Company’s and the Guarantor’s consent.  A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this section.  The Company or the Guarantor may remove the Trustee if:
 
(i)           the Trustee fails to comply with Section 7.10;
 
(ii)           the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
 
(iii)           a receiver or other public officer takes charge of the Trustee or its property; or
 
(iv)           the Trustee becomes incapable of acting.
 
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall notify each Holder of such event and shall promptly appoint a successor Trustee.  Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes of a particular tranche may, with the Company’s consent, appoint a successor Trustee to replace the  successor Trustee appointed by the Company to serve as Trustee on behalf of Holders of Notes of such tranche.
 
Every successor Trustee appointed hereunder with respect to the Notes of a particular tranche shall execute, acknowledge and deliver to the Company, the Guarantor and to the retiring Trustee an instrument accepting such appointment and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but on the request of the Company, the Guarantor or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.
 
Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to in the immediately preceding paragraph of this Section, as the case may be.
 
 
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If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, the Guarantor or the Holders of at least 10% in principal amount of the then outstanding Notes of a particular tranche may petition any court of competent jurisdiction for the appointment of a successor Trustee to serve as Trustee on behalf of Holders of Notes of such tranche.
 
If the Trustee after written request by any Holder who has been a Holder for at least six months fails to comply with Section 7.10, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
 
Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7 shall continue for the benefit of the retiring Trustee.
 
SECTION 7.9.   Successor Trustee by Merger, Etc .   Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of such Trustee, shall be the successor of such Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto.  In case any Notes shall have been authenticated, but not delivered, by the Trustee or the Authenticating Agent, any successor by merger, conversion or consolidation to such authenticating Trustee, or any successor Authenticating Agent, as the case may be, may adopt such authentication and deliver the Notes so authenticated with the same effect as if such successor Trustee or successor Authenticating Agent had itself authenticated such Notes.
 
SECTION 7.10.   Eligibility; Disqualification; Corporate Trust Required; Conflicting Interest .  The Trustee for the Notes shall be subject to the provisions of Section 310(b) of the TIA (as if this Indenture were qualified thereunder) during the period of time required thereby.  Nothing herein shall prevent the Trustee from filing with the SEC the application referred to in the penultimate paragraph of Section 310(b) of the TIA.  In determining whether the Trustee has a conflicting interest as defined in Section 310(b) of the TIA with respect to a tranche of Notes, there shall be excluded Notes of the other tranche of Notes.
 
The Trustee shall not be deemed to have a conflict of interest under Section 310(b) of the TIA with respect to any other indenture entered into with the Company or the Guarantor, provided that the Notes issued under this Indenture are wholly unsecured and any other indenture and the securities issued thereunder are wholly unsecured and rank equally with the Notes.
 
There shall at all times be a Trustee hereunder which shall be (i) a corporation organized and doing business under the laws of the United States of America, any state thereof, or the District of Columbia, authorized under such laws to exercise corporate trust powers, and subject to supervision or examination by Federal or State authority, or (ii) a corporation or other Person organized and doing business under the laws of a foreign government that is permitted to act as Trustee pursuant to a rule, regulation, or other order of the SEC, authorized under such laws to exercise corporate trust powers, and subject to supervision or examination by authority of such foreign government or a political subdivision thereof substantially equivalent to supervision or examination applicable to United States institutional trustees, having, in either case, a combined capital and surplus of at least $10,000,000.  If such corporation publishes reports of condition at least annually, pursuant to law or to requirements of the aforesaid supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  The Company, the Guarantor or any Person directly or indirectly controlling, controlled by, or under common control with the Company or the Guarantor shall not serve as Trustee for the Notes.  If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereunder specified in this Article.
 
 
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SECTION 7.11.   Preferential Collection of Claims Against Company .  The Trustee, in its capacity as Trustee hereunder, shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b).  A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated.
 
SECTION 7.12.   Authenticating Agents .  From time to time, the Trustee may, subject to its sole discretion, appoint one or more Authenticating Agents with respect to the Notes of a particular tranche, which may include any director or officer of the Company, the Guarantor or any Affiliate with power to act in the name of the Trustee and subject to its discretion in the authentication and delivery of the Notes of such tranche in connection with registrations of transfers and exchanges under Sections 2.6, 2.7, and 3.7 as fully to all intents and purposes as though such Authenticating Agent had been expressly authorized by those Sections of this Indenture to authenticate and deliver such Notes.  For all purposes of this Indenture the authentication and delivery of such Notes by an Authentication Agent for such Notes pursuant to this Section shall be deemed to be authentication and delivery of such Notes “by the Trustee” for the Notes of such series.  Any such Authenticating Agent shall at all times be a corporation organized and doing business under the laws of the United States or of any State thereof, or the District of Columbia, authorized under such laws to exercise corporate trust powers, and, if other than an Affiliate of the Trustee, having a combined capital and surplus of at least $10,000,000, and subject to supervision or examination by Federal, State, or District of Columbia authority.  If such corporation publishes reports of condition at least annually pursuant to law or the requirements of such supervising or examining authority, then for the purposes of this Section the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.
 
Any Authenticating Agent may resign at any time by giving written notice of resignation to the Trustee and to the Company.  The Trustee may at any time terminate the appointment of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company in the manner set forth in Section 12.2.  Upon receiving such a notice of resignation or upon such a termination, or in case at any time any Authenticating Agent shall cease to be eligible under this Section, the Trustee may appoint a successor Authenticating Agent, shall give written notice of such appointment to the Company and shall give written notice of such appointment to all Holders of Notes of such tranche in the manner set forth in Section 12.3.  Any successor Authenticating Agent  upon acceptance of his appointment hereunder, shall become vested with all the rights, powers and duties of his predecessor hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.
 
The Company agrees to pay to any corporation that has been appointed as Authenticating Agent from time to time reasonable compensation for such services.

 
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If an appointment with respect to the Notes of a particular tranche is made pursuant to this Section, the Notes of such tranche may have endorsed thereon, in addition to the Trustee’s certification of authentication, an alternate certificate of authentication in the following form:
 
“This is one of the Notes designated therein described in the within-mentioned Indenture.
 
                       [-----------------------],
 
               as Trustee
 
 
By:
 
 
As Authenticating Agent


 
By:
 
   
 
 
 
 

 
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ARTICLE VIII
 
SATISFACTION AND DISCHARGE OF INDENTURE
 
SECTION 8.1.   Option To Effect Legal Defeasance or Covenant Defeasance .  The Company or the Guarantor, as the case may be, may, at the option of its Board of Directors evidenced by a resolution set forth in an Officers’ Certificate, at any time, with respect to the Notes of a particular tranche, elect to have either Section 8.2 or 8.3 be applied to all outstanding Notes of such tranche upon compliance with the conditions set forth below in this Article VIII.
 
SECTION 8.2.   Legal Defeasance and Discharge .  Upon the Company’s or the Guarantor’s exercise under Section 8.1 of the option applicable to this Section 8.2, the Company or the Guarantor, as the case may be, shall be deemed to have been discharged from its obligations with respect to all outstanding Notes of a particular tranche or Guarantees with respect to such tranche of Notes, as the case may be, on the date the conditions set forth below are satisfied (hereinafter, “ Legal Defeasance ”).  For this purpose, such Legal Defeasance means that the Company shall be deemed to have paid and discharged all the obligations relating to the outstanding Notes of such tranche or the Guarantor shall be deemed to have discharged all the obligations relating to the Guarantees with respect to such tranche of Notes, and such Notes and Guarantees, as applicable, shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.6, Section 8.8 and the other Sections of this Indenture referred to in clauses (a) and (d) below, and to have satisfied all of their other respective obligations under such Notes or Guarantees and this Indenture and cured all then existing Events of Default with respect to such tranche of Notes (and the Trustee, on demand of and at the expense of the Company or the Guarantor, as the case may be, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (a) the rights of holders of outstanding Notes of such tranche and Guarantees with respect to such tranche of Notes to receive payments in respect of the principal, premium, if any and interest on such Notes when such payments are due or on the Redemption Date solely out of the trust created pursuant to this Indenture, (b) the right of holders of outstanding Notes of such tranche to receive payments in respect of Additional Amounts, if any, on such Notes when such payments are due or on the Redemption Date; (c) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s and Guarantor’s obligations in connection therewith; and (d) this Article VIII and the obligations set forth in Section 8.6 hereof.
 
Subject to compliance with this Article VIII, the Company or the Guarantor may exercise its option under this Section 8.2 notwithstanding the prior exercise of its option under Section 8.3 with respect to the Notes of a particular tranche or the Guarantee with respect to such tranche of Notes, as applicable.
 
SECTION 8.3.   Covenant Defeasance .  Upon the Company’s or the Guarantor’s exercise under Section 8.1 of the option applicable to this Section 8.3, the Company or the Guarantor, as the case may be, shall be released from any obligations under the covenants contained in Sections 4.3, 4.4 and 4.6 hereof with respect to the outstanding Notes of a particular tranche or Guarantees with respect to such tranche of Notes, as the case may be, on and after the date the conditions set forth below are satisfied (hereinafter, “Covenant Defeasance”), and the Notes of such tranche and Guarantees with respect to such tranche of Notes, as applicable, shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes and Guarantees shall not be deemed outstanding for accounting purposes).  For this purpose, such Covenant Defeasance means that, with respect to the outstanding Notes of a particular tranche and Guarantees with respect to the Notes of such tranche, the Company and the Guarantor, respectively, may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default with respect to the Notes of such tranche under Section 6.1(c), nor shall any event referred to in Sections 6.1(d) thereafter constitute a Default or Event of Default with respect to the Notes of such tranche, but, except as specified above, the remainder of this Indenture and such Notes and Guarantees shall be unaffected thereby.
 
 
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SECTION 8.4.   Conditions to Legal or Covenant Defeasance .  The following shall be the conditions to the application of either Section 8.2 or Section 8.3 to the outstanding Notes of a particular tranche and Guarantees with respect to the Notes of such tranche:
 
(i)           in the case of Legal Defeasance, either (A) all Notes of such tranche theretofore authenticated and delivered under the Indenture must have been delivered to the Trustee for cancellation or (B) the Company or the Guarantor, as the case may be, must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders of the Notes of such tranche, cash in U.S. dollars, non-callable Government Securities or a combination thereof in such amounts (and, in the case of Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient, as evidenced by a Certificate of a Firm of Independent Public Accountants delivered to the Trustee to pay the principal, premium, if any, interest and Additional Amounts, if any, due on the outstanding Notes of such tranche on the stated maturity date or on the applicable Redemption Date, as the case may be, of such principal, premium, if any, interest and Additional Amounts, if any, on the outstanding Notes of such tranche;
 
(ii)           in the case of Covenant Defeasance, the Company or the Guarantor, as the case may be, must irrevocably deposit, or cause to be irrevocably deposited, with the Trustee, in trust, for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable Government Securities or a combination thereof in such amounts (and, in the case of Government Securities, together with the predetermined and certain income to accrue thereon, without consideration of any reinvestment thereof) as will be sufficient, as evidenced by a Certificate of a Firm of Independent Public Accountants delivered to the Trustee to pay the principal, premium, if any, interest and Additional Amounts, if any, due on the outstanding Notes of such tranche on the stated maturity date or on the applicable Redemption Date, as the case may be, of such principal, premium, if any, interest and Additional Amounts, if any, on the outstanding Notes of such tranche;
 
(iii)           in the case of Legal Defeasance, the Company or the Guarantor, as the case may be, shall have delivered to the Trustee (A) an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, (1) the Company has received from, or there has been published by, the U.S. Internal Revenue Service a ruling or (2) since the Issuance Date, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such opinion of counsel in the United States shall confirm that, subject to customary assumptions and exclusions, the Holders of the outstanding Notes of such tranche will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred and (B) an Opinion of Counsel in the United Kingdom reasonably acceptable to the Trustee to the effect that Holders of the outstanding Notes of such tranche will not recognize income, gain or loss for United Kingdom income tax purposes as a result of such Legal Defeasance and will be subject to United Kingdom income tax on the same amounts, in the same manner and at the same time as would have been the case if such Legal Defeasance had not occurred;
 
 
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(iv)           in the case of Covenant Defeasance, the Company shall have delivered to the Trustee (A) an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the Holders of the outstanding Notes of such tranche will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred and (B) an Opinion of Counsel in the United Kingdom reasonably acceptable to the Trustee to the effect that Holders of the outstanding Notes of such tranche will not recognize income, gain or loss for United Kingdom income tax purposes as a result of such Covenant Defeasance and will be subject to United Kingdom income tax on the same amount in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
 
(v)           such Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any  material agreement or instrument to which the Company or the Guarantor is a party or by which the Company or the Guarantor is bound;
 
(vi)           in the case of Legal Defeasance, 91 days shall have passed during which no Event of Default under Section 6.1(e) or 6.1(f) has occurred;
 
(vii)           the Company or the Guarantor, as the case may be, shall have delivered to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company or the Guarantor, as the case may be, with the intent of defeating, hindering, delaying or defrauding any creditors of the Company or the Guarantor, as the case may be, or others;
 
(viii)           the Company or the Guarantor, as the case may be, shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel complying with Section 12.4; and
 
(ix)           if the Notes of such tranche are then listed on any securities exchange, the Company or the Guarantor, as the case may be, has delivered to the Trustee an Opinion of Counsel to the effect that such deposit and defeasance will not cause such Notes to be delisted.
 
SECTION 8.5.   Satisfaction and Discharge of Indenture .  This Indenture will be discharged with respect of the Notes of a particular tranche and will cease to be of further effect as to all Notes of such tranche issued thereunder and all obligations of the Guarantor with respect to the Notes of such tranche, including the Guarantees with respect to the Notes of such tranche, when either (a) all such Notes theretofore authenticated and delivered (except lost, stolen or destroyed Notes of such tranche which have been replaced or paid and Notes of such tranche for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company) have been delivered to the Trustee for cancellation; or (b)(i) all such Notes not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company or the Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust an amount of money in U.S. dollars or Government Securities or any combination thereof sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Trustee for cancellation for principal, premium, if any, accrued and unpaid interest and Additional Amounts, if any, to the date of maturity or redemption; (ii) no Default with respect to the Notes of such tranche shall have occurred within 91 days of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or the Guarantor is a party or by which it is bound; (iii) the Company or the Guarantor has paid or caused to be paid all sums payable by it with respect to the Notes of such tranche under this Indenture; and (iv) the Company or the Guarantor has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of such Notes at maturity or the redemption date, as the case may be.  In addition, with respect to clause (b) of the preceding sentence, the Company or the Guarantor shall have (i) delivered to the Trustee an Opinion of Counsel to the effect that the Holders of Notes will not recognize income, gain or loss for United States federal income tax purposes or United Kingdom income tax purposes as a result of such deposit, defeasance and discharge and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such deposit, defeasance and discharge had not occurred; (ii) if such Notes are then listed on any securities exchange, delivered to the Trustee an Opinion of Counsel to the effect that such deposit, defeasance and discharge will not cause such Notes to be delisted; and (iii) delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, complying with Section 12.4.
 
 
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SECTION 8.6.   Survival of Certain Obligations .  Notwithstanding the satisfaction and discharge of this Indenture with respect to a particular tranche of Notes and of the Notes of such tranche and Guarantees with respect to the Notes of such tranche referred to in Section 8.1, 8.2, 8.3, 8.4 or 8.5, the respective obligations of the Company, the Guarantor and the Trustee under Sections 2.6, 2.7, 4.2, 7.7, 7.8 and 7.10 shall survive until the Notes of such tranche and related Guarantees are no longer outstanding.  Nothing contained in this Article VIII shall abrogate any of the obligations or duties of the Trustee under this Indenture.
 
SECTION 8.7.   Acknowledgment of Discharge by Trustee .  Subject to Section 8.10, after (i) the conditions of Section 8.4 or 8.5 have been satisfied, (ii) the Company or the Guarantor has paid or caused to be paid all other sums payable hereunder by the Company or the Guarantor and (iii) the Company and the Guarantor have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent referred to in clause (i) above relating to the satisfaction and discharge of this Indenture with respect to a particular tranche of Notes have been complied with, the Trustee upon written request shall acknowledge in writing the discharge of all of the Guarantor’s obligations under this Indenture with respect to the Notes of such tranche and all of the Company’s obligations under this Indenture with respect to the Notes of such tranche except for those surviving obligations specified in this Article VIII.
 
SECTION 8.8.   Application of Trust Moneys .  All cash in U.S. dollars and Government Securities deposited with the Trustee pursuant to Section 8.4 or 8.5 in respect of Notes of a particular tranche or Guarantees with respect to the Notes of such tranche shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes, Guarantees and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of such Notes, of all sums due and to become due thereon for principal, premium, if any, interest and Additional Amounts, if any but such money need not be segregated from other funds except to the extent required by law.  The Holder of any Note replaced pursuant to Section 2.7 shall not be entitled to any such payment and shall look only to the Company or the Guarantor for any payment which such Holder may be entitled to collect.  In connection with the satisfaction and discharge of this Indenture or the defeasance of certain obligations under this Indenture, the Company may direct the Trustee to (i) invest any money received by the Trustee on the Government Securities deposited in trust in additional Government Securities, and (ii) deliver or pay to the Company from time to time upon the request of the Company any money or Government Securities held by it, which, as evidenced by a Certificate of a Firm of Independent Public Accountants, are in excess of the amount thereof which would then have been required to be deposited for the purpose for which such money or Government Securities were deposited or received.
 
The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the Government Securities deposited pursuant to Section 8.4 or 8.5 or the principal, premium, if any, interest and Additional Amounts, if any, received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of outstanding Notes.
 
 
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SECTION 8.9.   Repayment to the Company; Unclaimed Money .  The Trustee and any Paying Agent shall promptly pay or return to the Company upon Company Order, as the case may be, any cash or Government Securities held by them at any time that are not required for the payment of the principal, premium, if any, interest and any Additional Amounts, if any, on the Notes for which cash or Government Securities have been deposited pursuant to Section 8.4 or 8.5.
 
SECTION 8.10.   Reinstatement .  If the Trustee or Paying Agent is unable to apply any cash or Government Securities in accordance with Section 8.2, 8.3, 8.4 or 8.5 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the Notes and the Guarantor’s obligations under this Indenture shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2, 8.3, 8.4 or 8.5 until such time as the Trustee or Paying Agent is permitted to apply all such cash or Government Securities in accordance with Section 8.2, 8.3, 8.4 or 8.5; provided , however , that if the Company or the Guarantor has made any payment of principal, premium, if any, interest or any Additional Amounts, if any, on any Notes because of the reinstatement of its obligations, the Company and the Guarantor shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or Government Securities held by the Trustee or Paying Agent.
 
 
ARTICLE IX
 
AMENDMENTS, SUPPLEMENTS AND WAIVERS
 
SECTION 9.1.   Without Consent of Holders of Notes .  Without notice to or the consent of any Holders, the Company and the Guarantor, when each is authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to such Trustee, for any of the following purposes:
 
(i)           to evidence the succession of another corporation or other Person to the Company or the Guarantor, and the assumption by any such successor of the covenants of the Company or the Guarantor, as the case may be, herein and in the Notes;
 
(ii)           to add to the covenants of the Company or the Guarantor, for the benefit of the Holders of Notes of a particular tranche, to convey, transfer, assign, mortgage or pledge any property to or with the Trustee or otherwise secure the Notes of a particular tranche or to surrender any right or power herein conferred upon the Company or the Guarantor;
 
(iii)           to add any additional Events of Default with respect to the Notes;
 
(iv)           to evidence and provide for the acceptance of appointment hereunder of a Trustee other than First Chicago, as Trustee and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder;
 
 
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(v)           to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Notes of a particular tranche and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trust hereunder;
 
(vi)           to add to the conditions, limitations and restrictions on the authorized amount, form, terms or purposes of issue, authentication and delivery of Notes, as herein set forth, other conditions, limitations and restrictions thereafter to be observed;
 
(vii)           to add to or change or eliminate any provisions of this Indenture as shall be necessary or desirable in accordance with any amendments to the TIA;
 
(viii)           to cure any ambiguity, omission, defect or inconsistency;
 
(ix)           to make any other amendment, modification, change or supplement to this Indenture or the Notes of any tranche that does not materially adversely affect the rights of any Holder of any Notes of that tranche;
 
(x)           to make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights under this Indenture of any such Holder; and
 
(xi)           to surrender any right or power conferred upon the Company or the Guarantor.
 
The Trustee may waive compliance by the Company or the Guarantor with any provision of this Indenture or the Notes without notice to or consent of any Holder of any Notes if such waiver does not materially adversely affect the rights of any Holder of any Notes.
 
SECTION 9.2.   With Consent of Holders of Notes .  The Company, the Guarantor and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of amending or supplementing any of the provisions of this Indenture, to the extent applicable to the Notes of a particular tranche, or the Notes of a particular tranche or Guarantees of a particular tranche of Notes, without notice to any Holder, but with the written consent of the Holders of a majority in aggregate principal amount of the Notes of such tranche then outstanding.  The Holders of a majority in principal amount of the Notes of such tranche affected may waive compliance by the Company or the Guarantor with any provision of this Indenture or the Notes of such tranche or Guarantee of such tranche without notice to any Holder, in each case by act of said Holders delivered to the Company the Guarantor and the Trustee.  No such supplemental indenture shall, without the consent of the Holder of each outstanding Note of such tranche affected thereby:
 
(i)           change the Maturity Date of the principal of, or any installment of principal of or interest on, any Note of such tranche, or reduce the principal amount thereof or the rate of interest thereon, if any, or any premium payable upon the redemption thereof, or change any obligation of the Company or the Guarantor to pay Additional Amounts, if any, (except as contemplated by Sections 5.1 and 5.2 and permitted by Section 9.1(i)) or change the Place of Payment or the currency in which any Note of such tranche or the interest thereon is payable;
 
(ii)           reduce the percentage in principal amount of the Notes of such tranche, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in this Indenture;
 
 
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(iii)           modify any of the provisions of this Section, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Note of such tranche affected thereby; provided , however , that this clause shall not be deemed to require the consent of any Holder of a Note of such tranche with respect to changes in the references to “the Trustee” and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Sections 7.8, 7.10, 9.1(iv) and 9.1(v); and
 
(iv)           amend the terms of the Notes of such tranche (including the Guarantees) or this Indenture in a way that would result in the loss of an exemption from any taxes or an exemption from any obligation to withhold or deduct taxes unless the Company and the Guarantor agree to pay Additional Amounts, if any, in respect thereof.
 
After an amendment, supplement or waiver under this Section becomes effective, the Company or the Guarantor shall mail to the Holders of Notes affected thereby a notice briefly describing the amendment, supplement or waiver.  Any failure of the Company or the Guarantor to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment or supplemental indenture or waiver.
 
SECTION 9.3.   Compliance with TIA .  From the date on which this Indenture is qualified under the TIA, every amendment, waiver or supplement of this Indenture or the Notes shall comply with the TIA as then in effect.
 
SECTION 9.4.   Revocation and Effect of Consents .  Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note.  However, any such Holder of a Note or subsequent Holder of a Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective.  An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder of a Note.
 
The Company may fix a record date for determining which Holders of the Notes must consent to such amendment, supplement or waiver.  If the Company fixes a record date, the record date shall be fixed at (i) the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders of Notes furnished to the Trustee prior to such solicitation pursuant to Section 2.5 or (ii) such other date as the Company shall designate.
 
SECTION 9.5.   Notation on or Exchange of Notes .  The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated.  The Company in exchange for all Notes of a particular tranche may issue and the Trustee shall authenticate new Notes of such tranche that reflect the amendment, supplement or waiver.
 
Failure to make the appropriate notation or issue a new Note of a particular tranche shall not affect the validity and effect of such amendment, supplement or waiver.
 
SECTION 9.6.   Trustee To Sign Amendments, Etc .   The Trustee shall execute any amendment, supplement or waiver authorized pursuant to this Article IX; provided , however , that the Trustee may, but shall not be obligated to, execute any such amendment, supplement or waiver which affects the Trustee’s own rights, duties or immunities under this Indenture.  The Trustee shall be entitled to receive indemnity reasonably satisfactory to it, and shall be fully protected in relying upon, an Opinion of Counsel and an Officers’ Certificate from each of the Company and the Guarantor each stating that the execution of any amendment, supplement or waiver authorized pursuant to this Article IX is authorized or permitted by this Indenture and constitutes the legal, valid and binding obligations of the Company and the Guarantor enforceable in accordance with its terms.  Such Opinion of Counsel shall not be an expense of the Trustee.
 
 
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SECTION 9.7.   Effect of Supplemental Indentures .  Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.
 
 
ARTICLE X
 
GUARANTEES
 
SECTION 10.1.   Guarantees .  The Guarantor hereby unconditionally and irrevocably guarantees to each Holder and to the Trustee and its successors and assigns (i)(a) the full and punctual payment of principal and interest on the Notes of such Holder when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company under this Indenture and the Notes (including Additional Amounts, if any) and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture and the Notes and (ii) in the case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal (all of the foregoing being hereinafter collectively called the “Guarantees”).
 
The Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guarantees and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Notes or the Guarantees.  The Guarantees hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person under this Indenture, the Notes or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Notes or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Guarantees or any of them; (e) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guarantees or (f) any change in the ownership of the Guarantor.
 
The Guarantor further agrees that its Guarantees hereunder constitute a guarantee of payment, performance and compliance when due (and not a guarantee of collection).
 
The Guarantor hereby agrees that its obligations hereunder shall be as principal and not merely as surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or failure to enforce the provisions of any Note or this Indenture, or any waiver, modification, consent or indulgence granted to the Company with respect thereto (unless the same shall also be provided the Guarantor), by the Holder of any Note or the Trustee, the recovery of any judgment against the Company or any action to enforce the same, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided that, notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall, without the consent of the Guarantor, increase the principal amount of a Note or the interest rate thereon or increase any premium payable upon redemption thereof.  The Guarantees shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guarantees or otherwise.  Without  limiting the generality of the foregoing, the Guarantor covenants that the Guarantees shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Notes or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.
 
 
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The Guarantor further agrees that the Guarantees shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal, premium, if any, interest or Additional Amounts, if any, on the Tranche A Notes or the Tranche B Notes is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
 
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay the principal of, premium on, if any, interest on, or Additional Amounts, if any, on the Tranche A Notes or the Tranche B Notes when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other obligation under the Notes, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such obligations under such Notes, (ii) accrued and unpaid interest on such obligations under such Notes (but only to the extent not prohibited by law) and (iii) all other monetary obligations with respect to such Notes (including Additional Amounts, if any) of the Company to the Holders and the Trustee.
 
The Guarantor will be subrogated to all rights of the Holder against the Company in respect of any amount paid by the Guarantor pursuant to the provisions of the Guarantee; provided , however , that the Guarantor shall not be entitled to enforce, or to receive any payments arising out of or based upon, such right of subrogation until the principal of, premium on, if any, interest and Additional Amounts, if any, on such Note shall have been paid in full.  The Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations with respect to the Tranche A Notes or Tranche B Notes hereby may be accelerated as provided in Article VI for the purposes of the Guarantees, herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations with respect to such Notes, and (y) in the event of any declaration of acceleration of such obligations as provided in Article VI, the  Guarantees (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Section.
 
The Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Section.
 
SECTION 10.2.   Successors and Assigns .  This Article X shall be binding upon the Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Notes shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
 
 
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SECTION 10.3.   No Waiver .  Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article X shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article X at law, in equity, by statute or otherwise.
 
SECTION 10.4.   Modification .  No modification, amendment or waiver of any provision of this Article X, nor the consent to any departure by the Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstances.
 
 
ARTICLE XI
 
MEETINGS OF HOLDERS OF THE NOTES
 
SECTION 11.1.   Purposes of Meetings .  A meeting of the Holders of a particular tranche of Notes may be called at any time from time to time pursuant to this Article XI for any of the following purposes:
 
(1)  to give any notice to the Company, the Guarantor or to the Trustee, or to give any directions to the Trustee, or to consent to the waiving of any Default hereunder and  its consequences, or to take any other action authorized to be taken by Holders pursuant to Article VI hereof;
 
(2)  to remove the Trustee and appoint a successor trustee pursuant to Article VII hereof;
 
(3)  to consent to the execution of an indenture supplemental hereto pursuant to Article IX hereof; or
 
(4)  to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal amount of the outstanding Notes of a particular tranche under any other provision of this Indenture or under applicable law.
 
SECTION 11.2.   Place of Meetings .  Meetings of Holders may be held at such place or places as the Trustee or, in case of its failure to act, the Company, the Guarantor or the Holders calling the meeting, shall from time to time determine.
 
SECTION 11.3.   Call and Notice of Meetings .  (a)  The Trustee may at any time call a meeting of Holders of a particular tranche of Notes to be held at such time and at such place in the location determined by the Trustee pursuant to Section 11.2 hereof.  Notice of every meeting of Holders, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be mailed to each Holder and published in the manner contemplated by Section 12.3 hereof.  Such notice shall be given not less than 20 days nor more than 90 days prior to the date fixed for the meeting.
 
 
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(b)  In case at any time the Company or the Guarantor, as the case may be, pursuant to a Board Resolution, or the Holders of at least a majority in aggregate principal amount of the Notes of a particular tranche then outstanding, shall have requested the Trustee to call a meeting of the Holders, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have made the first giving of the notice of such meeting within 20 days after receipt of such request, then the Company, the Guarantor or the Holders in the amount above specified may determine the time (not less than 21 days after notice is given) and the place in the location determined by the Company, the Guarantor or the Holders pursuant to Section 11.2 hereof for such meeting and may call such meeting to take any action authorized in Section 11.1 hereof by giving notice thereof as provided in Section 11.3(a) hereof.
 
SECTION 11.4.   Voting at Meetings .  To be entitled to vote at any meeting of Holders, a Person shall be (i) a Holder or (ii) a Person appointed in writing as proxy for a Holder or Holders by such Holder or Holders.  The only Persons who shall be entitled to be present or to speak at any meeting of Holders shall be the Persons so entitled to vote at such meeting and their counsel, any representatives of the Trustee and its counsel, any representatives of the Company and its counsel and any representatives of the Guarantor and its counsel.
 
SECTION 11.5.   Voting Rights, Conduct and Adjournment .  (a)  Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders in regard to proof of the holding of Notes of a particular tranche and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall deem appropriate.  Except as otherwise permitted or required by any such regulations, the holding of Notes of a particular tranche shall be proved in the manner specified in Article II hereof and the appointment of any proxy shall be proved in such manner as is deemed appropriate by the Trustee or by having the signature of the person executing the proxy witnessed or guaranteed by any bank, banker or trust company customarily authorized to certify to the holding of a security such as a Global Note.
 
(b)  No action at a meeting of Holders shall be effective unless approved by Persons holding or representing Notes of a particular tranche in the aggregate principal amount required by the provision of this Indenture pursuant to which such action is being taken.
 
(c)  At any meeting of Holders, each Holder or proxy shall be entitled to one vote for each $1,000 principal amount of outstanding Notes of a particular tranche held or represented; provided , however , that no vote shall be cast or counted at any meeting in respect of any Note of such tranche challenged as not outstanding and ruled by the chairman of the meeting to be not outstanding.  The chairman of the meeting shall have no right to vote other than by virtue of outstanding Note of such tranche held by him or instruments in writing duly designating him as the person to vote on behalf of Holders.  Any meeting of Holders with respect to which a meeting was duly called pursuant to the provisions of Section 11.3 may be adjourned from time to time by a majority of such Holders present and the meeting may be held as so adjourned without further notice.
 
(d)  The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company, the Guarantor or by Holders as provided in Section 11.3, in which case the Company, the Guarantor or the Holders calling the meeting, as the case may be, shall in like manner appoint a temporary chairman.  A permanent chairman and a permanent secretary of the meeting shall be elected by a majority vote of the meeting.
 
SECTION 11.6.   Revocation of Consent by Holders .  At any time prior to (but not after) the evidencing to the Trustee of the taking of any action at a meeting of Holders by the Holders of the percentage in aggregate principal amount of the Notes of a particular tranche specified in this Indenture in connection with such action, any Holder of a Note of such tranche the serial number of which is included in the Notes of such tranche the Holders of which have consented to such action may, by filing written notice with the Trustee at its principal corporate trust office and upon proof of holding as provided herein, revoke such consent so far as concerns such Notes.  Except as aforesaid any such consent given by the Holder of any Notes shall be conclusive and binding upon such Holder and upon all future Holders and owners of such Notes and of any Notes issued in exchange therefore, in lieu thereof or upon transfer thereof, irrespective of whether or not any notation in regard thereto is made upon such Notes.  Any action taken by the Holders of the percentage in aggregate principal amount of the Holders specified in this Indenture in connection with such action shall be conclusively binding upon the Company, the Guarantor, the Trustee and the Holders of all the Notes of such tranche.
 
 
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SECTION 11.7.   No Delay of Rights by Meeting .  Nothing contained in this Article XI shall be deemed or construed to authorize or permit, by reason of any call of a meeting of Holders or any rights expressly or impliedly conferred hereunder to make such call, any hindrance or delay in the exercise of any right or rights conferred upon or reserved to the Trustee or to any Holder under any of the provisions of this Indenture or of the Notes of any tranche.
 
 
ARTICLE XII
 
MISCELLANEOUS
 
SECTION 12.1.   TIA Controls .  Except as otherwise provided herein, if any provision hereof limits, qualifies or conflicts with the duties imposed by any of Sections 310 through 317, inclusive, of the TIA through the operation of Section 318(c) thereof, such imposed duties shall control.
 
SECTION 12.2.   Notices .  Any notice or communication shall be sufficiently given if in writing and delivered in person or mailed by first-class mail addressed as follows:
 
if to the Company:
 
Black & Decker Holdings Inc.
210 Bath Road
Slough, Berkshire
SL1 3YD England
Attention: Secretary
 
with a copy to the Guarantor;
 
if to the Guarantor:
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
Attention: Treasurer
 
with a copy to:
 
Miles & Stockbridge P.C.
10 Light Street
Baltimore, Maryland 21202
Attention: Glenn Campbell
 
 
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and
 
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21228
Attention: General Counsel
 
if to the Trustee:
 
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust Services Division
Facsimile: 312-407-1708
 
with a copy to:
 
The First National Bank of Chicago
153 West 51st Street, 6th Floor
New York, New York 10019
Attention: Michael Pinzon
 
For purposes of Section 4.2:
 
The First Chicago Trust Company of New York
14 Wall Street, 8th Floor
New York, New York 10005
Attention: Michael Pinzon
Facsimile: 212-240-8938
 
if to the Exchange Agent or Paying Agent:
 
The First Chicago Trust Company of New York
14 Wall Street, 8th Floor
New York, New York 10005
Attention: Michael Pinzon
Facsimile: 212-240-8938
 
The Company, the Guarantor or the Trustee by notice to the others may designate additional or different addresses for subsequent notices or communications.  If the Trustee of any Notes is other than the Trustee initially named in this Indenture or any successor thereto, any notice or communication shall be sufficiently given if in writing and delivered in person or mailed by first class mail addressed to that Trustee at the address provided for in the supplemental indenture executed in connection with the appointment of that Trustee in respect of the Notes.
 
SECTION 12.3.   Notice to Holders .  Any notice or communication mailed to a Holder shall be mailed by first-class mail or other equivalent means at that Holder’s address as it appears on the registration books of the Exchange Agent and shall be sufficiently given if so mailed within the time prescribed.
 
 
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Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.  If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
 
Notices regarding the Notes of a particular tranche will be (i) published in a leading newspaper having a general circulation in New York (which is expected to be The Wall Street Journal ) (and so long as such Notes are listed on the Luxembourg Stock Exchange and the rules of such Luxembourg Stock Exchange shall so require, a newspaper having a general circulation in Luxembourg (which is expected to be the Luxemburger Wort)) or (ii) in the case of Definitive Notes of a particular tranche, mailed to Holders by first-class mail at their respective addresses as they appear on the registration books of the Exchange Agent (and, so long as such Notes are listed on the Luxembourg Stock Exchange and the rules of such Stock Exchange shall so require, published in a newspaper having a general circulation in Luxembourg (which is expected to be the Luxemburger Wort)).  Notices given by publication will be deemed given on the first date on which publication is made and notices given by first-class mail, postage prepaid, will be deemed given five calendar days after mailing.
 
SECTION 12.4.   Compliance Certificates and Opinions .  Upon any request or application by the Company or the Guarantor to the Trustee to take any action under this Indenture, the Company or the Guarantor shall furnish to the Trustee (i) an Officers’ Certificate stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and (ii) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
 
Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include (i) a statement that the person making such certificate or opinion has read such certificate or condition, (ii) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based, (iii) a statement that, in the opinion of such person, the person has made such examination or investigation as is necessary to enable the person to express an informed opinion as to whether such covenant or condition has been complied with, and (iv) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with.
 
SECTION 12.5.   Form of Documents Delivered to Trustee .  Any certificate or opinion of an officer of the Company or the Guarantor may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to matters upon which his certificate or opinion is based are erroneous.
 
Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company or Guarantor stating that the information with respect to such factual matters is in the possession of the Company or Guarantor, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.
 
Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.
 
SECTION 12.6.   Rules by Trustee, Paying Agent, Exchange Agent .  The Trustee, Paying Agent or Exchange Agent may make reasonable rules for its functions.
 
 
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SECTION 12.7.   Non-Business Day .  In any case where any payment date of a Note of any particular tranche shall not be a Business Day at any Place of Payment with respect to Notes of that tranche, then (notwithstanding any other provision of this Indenture or of the Notes) payment of principal, premium, if any, interest or Additional Amounts, if any, with respect to such Note need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the payment date, provided that no interest shall accrue for the period from and after such payment date.
 
SECTION 12.8.   Governing Law and Submission to Jurisdiction .  THIS INDENTURE, THE GUARANTEE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  EACH OF THE COMPANY AND THE GUARANTOR AGREES TO SUBMIT TO THE JURISDICTION OF THE U.S. FEDERAL AND NEW YORK STATE COURTS LOCATED IN THE BOROUGH OF MANHATTAN, CITY AND STATE OF NEW YORK FOR PURPOSES OF ANY LEGAL ACTIONS AND PROCEEDINGS ARISING OUT OF OR BASED UPON THE NOTES AND THE INDENTURE, IN THE CASE OF THE COMPANY, AND THE GUARANTEES AND THE INDENTURE IN THE CASE OF THE GUARANTOR.
 
SECTION 12.9.   No Adverse Interpretation of Other Agreements .  This Indenture may not be used to interpret another indenture, loan or debt agreement of any of the Company, the Guarantor or any of its Subsidiaries.  Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
 
SECTION 12.10.   Immunity of Incorporators, Stockholders, Employees, Officers and Directors .  A director, officer, employee, stockholder or incorporator, as such, of the Company or the Guarantor shall not have any liability for any obligation of the Company or the Guarantor under the Notes or the Indenture or for any claim based on, with respect to or by reason of such obligations or their creation.  All such liability is waived and released as a condition of, and as partial consideration for, the execution of this Indenture and the issue of the Notes.
 
SECTION 12.11.   Successors and Assigns .  Except as otherwise provided herein, all covenants and agreements in this Indenture by the Company and the Guarantor shall bind their successors and assigns, whether so expressed or not.
 
SECTION 12.12.   Counterpart Originals .  All parties hereto may sign any number of copies of this Indenture.  Each signed copy or counterpart shall be an original, but all of them together shall represent one and the same agreement.
 
SECTION 12.13.   Severability .  In any case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
 
SECTION 12.14.   Table of Contents, Headings, etc .   The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.
 
SECTION 12.15.   Benefits of Indenture .  Nothing in this Indenture or in the Notes, expressed or implied, shall give to any Person, other than the parties hereto, any Paying Agent, any Exchange Agent or co-Exchange Agent and their successors hereunder and the Holders of Notes, any benefit or any legal or equitable right, remedy or claim under this Indenture.
 
 
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SECTION 12.16.   Language of Notices, etc .   Any request, demand, authorization, direction, notice, consent or waiver required or permitted under this Indenture shall be in the English language, and any published notice may also be in an official language of the country or province of publication.
 
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested as of the date first written above.
 
[SEAL]
BLACK & DECKER HOLDINGS INC.,
 
as Issuer

 
           
Attest: 
/s/ Norman R. Judd
  By:
/s/  Mark M. Rothleitner
 
 
Title:    Norman R. Judd
   
Name:  Mark M. Rothleitner
 
 
 
   
 
 

 
[SEAL]
THE BLACK & DECKER CORPORATION,
 
as Guarantor
 
 
           
Attest: 
/s/ Lucy A. Bosley
  By:
/s/  Thomas M. Schoewe
 
 
Title:    Asst. Secretary
   
Name:  Thomas M. Schoewe
 
 
 
   
Title:    Senior Vice President and Chief Financial Officer   
 
 
 
  THE FIRST NATIONAL BANK OF CHICAGO,  
 
as Trustee
 
       
 
By:
/s/ Michael Pinzon  
    Name:  Michael Pinzon   
    Title:    Trust Officer  
       

 

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Exhibit 10.4
 
 
 

$700,000,000

364-DAY CREDIT AGREEMENT

dated as of March [12], 2010

among

STANLEY BLACK & DECKER, INC.,
as Initial Borrower

THE BLACK & DECKER CORPORATION,
as Subsidiary Guarantor


and


THE INITIAL LENDERS NAMED HEREIN,
as Initial Lenders

and


CITIBANK, N.A.,
as Administrative Agent


CITIGROUP GLOBAL MARKETS INC. and
BANC OF AMERICA SECURITIES LLC,
as Lead Arrangers and Book Runners

BANK OF AMERICA, N.A.,
as Syndication Agent
 
 
 
 
 
TABLE OF CONTENTS
 
 
Page

            SECTION 1.02
   

   

   

   

   

   

 
 
(i)
 
 


   


 
 
 
EXHIBIT A-1 FORM OF RATE REQUEST
EXHIBIT A-2 FORM OF NOTICE OF BORROWING
EXHIBIT B FORM OF NOTICE OF CONVERSION OR CONTINUATION
EXHIBIT C-1 FORM OF OPINION OF COUNSEL TO THE COMPANY
EXHIBIT C-2 FORM OF OPINION OF COUNSEL TO THE SUBSIDIARY GUARANTOR
EXHIBIT D FORM OF ASSIGNMENT AND ACCEPTANCE
 
   
(ii)
 
 
EXHIBIT E   FORM OF NOTE
EXHIBIT F FORM OF DESIGNATION LETTER
EXHIBIT G    FORM OF TERMINATION LETTER
         
                            
                         
 
 
 
364-DAY CREDIT AGREEMENT

 

This 364-DAY CREDIT AGREEMENT (as amended, supplemented or otherwise modified from time to time, the “ Agreement ”) is made as of March [12], 2010 between STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “ Company ”), THE BLACK & DECKER CORPORATION, a Maryland corporation (the “ Subsidiary Guarantor ”), the banks, financial institutions and other institutional lenders (the “ Initial Lenders ”) listed on the signature pages hereof, and CITIBANK, N.A. (“ Citibank ”), as administrative agent (in such capacity, the “ Administrative Agent ”) for the Lenders (as hereinafter defined).

ARTICLE I
 
DEFINITIONS AND ACCOUNTING TERMS
 
 
SECTION 1.01   Certain Defined Terms .   As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):
 
“ Acquiring Person ” means any person (other than the ESOP) who is or becomes the beneficial owner, directly or indirectly, of 10% or more of the Company’s outstanding common stock.
 
“ Administrative Agent’s Account ” means, with respect to any Currency, the account of the Administrative Agent maintained by the Administrative Agent for such Currency and most recently designated by it by notice to the Lenders and the Company.
 
“ Advance ” means an advance by a Lender to a Borrower as part of a Borrowing and refers to a Base Rate Advance or a Eurocurrency Rate Advance, each of which shall be a “ Type ” of Advance.  For the purposes of determining the unutilized amount of each Lender’s Commitment at any time, the amount of each Advance of such Lender that is outstanding in an Alternate Currency shall be deemed to be the Dollar Equivalent of the amount of such Advance.
 
“ Affiliate ” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
 
“ Agent’s Group ” has the meaning provided in Section 7.02(b).
 
“ Alternate Currencies ” means Euros and Pounds Sterling.
 
“ Applicable Base Rate Margin ” means, on any day, a rate per annum equal to the higher of (a) the Applicable Eurocurrency Margin for such day minus 1.00% and
(b) 0.00%.
 
“ Applicable Eurocurrency Margin ” means, on any date for each Eurocurrency Rate Advance, the rate per annum equal to the arithmetical mean of the one-year credit default swap mid-rate spreads of the Company (the “ Credit Default Swap Spread ”) (as provided by Markit Group Limited (or any successor thereto) to the Administrative Agent) for each Business Day during the period of 30 days (the “ Calculation Period ”) immediately preceding but not including the day which falls two Business Days prior to the first day of the applicable Interest Period for such Advance; provided, that the Applicable Eurocurrency Margin shall in no event be less than a rate per annum equal to the Floor or greater than a rate per annum equal to the Cap; provided, further, that if the Applicable Eurocurrency Margin is unavailable on any Business Day during the Calculation Period, the arithmetical mean shall be calculated based on the actual number of Business Days within the Calculation Period for which such rate is available.
 
 
If at any time the Applicable Eurocurrency Margin cannot be determined or is otherwise unavailable, the Company and the Required Lenders shall negotiate in good faith (for a period of up to thirty days after the Applicable Eurocurrency Margin first becomes unavailable (such thirty-day period, the “ Negotiation Period ”)) to agree on an alternative method for establishing the Applicable Eurocurrency Margin.  The Applicable Eurocurrency Margin at any date of determination thereof which falls during the Negotiation Period shall be based upon the then most recently available quote provided by Markit Group Limited (or any successor thereto) of the Credit Default Swap Spread; provided that the Applicable Eurocurrency Margin shall in no event be less than a rate per annum equal to the Floor or greater than a rate per annum equal to the Cap.  If no such alternative method is agreed upon during the Negotiation Period, the Applicable Eurocurrency Margin at any date of determination subsequent to the end of the Negotiation Period shall be a rate per annum equal to the Cap.
 
Notwithstanding anything else to the contrary in this definition of “Applicable Eurocurrency Margin”, the Applicable Eurocurrency Margin shall be the rate per annum equal to the Cap from and after the Term Loan Conversion Date.
 
“ Applicable Facility Fee Rate ” means, on any date, a rate per annum equal to
 
(i) 0.100% if on such date the Company’s outstanding Long-Term Indebtedness is rated A+ or higher by Standard & Poor’s, A1 or higher by Moody’s, or A+ or higher by Fitch,
 
(ii) 0.150% if on such date clause (i) is inapplicable and the Company’s outstanding Long-Term Indebtedness is rated A or higher by Standard & Poor’s, A2 or higher by Moody’s, or A or higher by Fitch,
 
(iii) 0.200% if on such date clauses (i) and (ii) are inapplicable and the Company’s outstanding Long-Term Indebtedness is rated A- or higher by Standard & Poor’s, A3 or higher by Moody’s, or A- or higher by Fitch,
 
(iv) 0.250% if on such date clauses (i), (ii) and (iii) are inapplicable and the Company’s outstanding Long-Term Indebtedness is rated BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and
 
(v) 0.300% if on such date clauses (i), (ii), (iii) and (iv) are inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency);
 
provided   that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Applicable Facility Fee Rate” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
 
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“ Applicable Lending Office ” means, with respect to each Lender, such Lender’s Domestic Lending Office in the case of a Base Rate Advance and such Lender’s Eurocurrency Lending Office in the case of a Eurocurrency Rate Advance.
 
“ Applicable Restructuring Charge ” means
 
    (a)           for any Restructuring Period falling in the Company’s fiscal year 2009, the restructuring charges reported in the Company’s SEC Filings for such fiscal quarter; provided that the sum of the Applicable Restructuring Charges for all of the Restructuring Periods in the Company’s fiscal year 2009 will not exceed $50,000,000 in the aggregate; and
 
                        (b)           for any Restructuring Period falling in the Company’s fiscal year 2010, 2011, 2012, or 2013, amounts relating to one or more of the following: (i) restructuring charges, including, without limitation, the effect of reconstruction, recommissioning or reconfiguration of fixed assets for alternative uses, store closure, office closure, plant closure, facility consolidations, downsizing, shutdown costs (including future lease commitments and contract termination costs with respect thereto), curtailments or modifications to pension and post-retirement employee benefit plans, retention, severance, system establishment costs, and acquisition integration costs; (ii) change of control payments and transaction fees; (iii) performance-based bonus payments to Nolan Archibald; (iv) all expenses and charges related to any stock based compensation; (v) non-cash inventory step-up charges; and (vi) liabilities under Section 280G of the Internal Revenue Code and gross-ups related thereto; provided that the sum of the Applicable Restructuring Charges for all of the Restructuring Periods in the Company’s fiscal years 2010, 2011, 2012, and 2013 will not exceed $1,200,000,000 in the aggregate, of which not more than $900,000,000 is cash.
 
“ Approved Electronic Communications ” means each Communication that any Loan Party is obligated to, or otherwise chooses to, provide to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein, including any financial statement, financial and other report, notice, request, certificate and other information material; provided , however, that, solely with respect to delivery of any such Communication by any Loan Party to the Administrative Agent and without limiting or otherwise affecting either the Administrative Agent’s right to effect delivery of such Communication by posting such Communication to the Approved Electronic Platform or the protections afforded hereby to the Administrative Agent in connection with any such posting, “Approved Electronic Communication” shall exclude (i) any notice of borrowing, letter of credit request, swing loan request, notice of conversion or continuation, and any other notice, demand, communication, information, document and other material relating to a request for a new, or a conversion or continuation of an existing, Borrowing, (ii) any notice pursuant to Section 2.07(a) and Section 2.07(b) and any other notice relating to the payment of any principal or other amount due under any Loan Document prior to the scheduled date therefor, (iii) all notices of any Default or Event of Default and (iv) any notice, demand, communication, information, document and other material required to be delivered to satisfy any of the conditions set forth in Article 3 or any other condition to any Borrowing or other extension of credit hereunder or any condition precedent to the effectiveness of this Agreement.
 
 
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“ Approved Electronic Platform ” has the meaning provided in Section 8.02(b).
 
“ Assignment and Acceptance ” means an assignment and acceptance accepted by the Administrative Agent in substantially the form of Exhibit D hereto.
 
“ Attributable Debt ” means, in respect of any lease transaction described in Section 5.02(c), as of the date of determination, the lesser of (i) the sale price of the property so leased multiplied by a fraction the numerator of which is the remaining portion of the base term of the lease included in such transaction and the denominator of which is the base term of such lease, and (ii) the total obligation (discounted to present value at the implicit interest factor, determined in accordance with generally accepted financial practice, included in the rental payments or, if such interest factor cannot readily be determined, at a rate of interest of 10% per annum, compounded semi-annually) of the lessee for rental payments (other than amounts required to be paid on account of property taxes as well as maintenance, repairs, insurance, water rates and other items which do not constitute payments for property rights) during the remaining portion of the base term of the lease included in such transaction.
 
“ Base Rate ” means a fluctuating interest rate per annum as shall be in effect from time to time, which rate per annum shall at all times be equal to the highest of:
 
(a)  the rate of interest announced publicly by the Reference Bank in New York, New York, from time to time, as its base rate;
 
(b)  1/2 of one percent per annum above the Federal Funds Rate; and
 
(c)  the rate equal to the Eurocurrency Rate for a Dollar denominated Advance having an Interest Period of one month determined for each day that a Base Rate Loan is outstanding (and in respect of any day that is not a Banking Day, such rate as in effect on the immediately preceding Banking Day) plus 1.00% per annum.
 
“ Base Rate Advance ” means an Advance denominated in Dollars that bears interest as provided in Section 2.05(a).
 
“ Borrowers ” means, collectively, the Company and each Designated Borrower.
 
“ Borrowing ” means a borrowing consisting of simultaneous Advances of the same Type made by each of the Lenders to a Borrower pursuant to Section 2.01.
 
“ Business Day ” means a day of the year (a) on which banks are not required or authorized to close in New York City, (b) if the applicable Business Day relates to any Eurocurrency Rate Advances, on which dealings in Dollars are carried on in the London interbank market, (c) if such day relates to a Borrowing of, or a payment or prepayment of principal of or interest on or an Interest Period for an Advance denominated in Pounds Sterling, or a notice with respect thereto, that is also a day on which commercial banks and foreign exchange markets settle payments in London, and (d) if such day relates to a Borrowing of, or a payment or prepayment of principal of or interest on or an Interest Period for an Advance denominated in Euros, or a notice with respect thereto, that is also a Target Operating Day.
 
“ Cap ” means, on any date, a rate per annum equal to
 
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(i) 2.500% if on such date the Company’s outstanding Long-Term Indebtedness is BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and
 
(ii) 3.000% if on such date clause (i) is inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency);
 
provided that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Cap” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
“ Capital Lease ” means any lease of property, real or personal, the obligations under which are capitalized on the consolidated balance sheet of the Company and its Subsidiaries.
 
“ Change of Control ” means, with respect to the Company, the occurrence of any event, act or condition which results in either (i) any Person other than the ESOP becoming the beneficial owner, directly or indirectly, of 30% or more of the outstanding common stock of the Company or (ii) individuals who constitute the Continuing Directors ceasing for any reason to constitute at least the majority of the Board of Directors of the Company.
 
“ Citibank ” has the meaning specified in the first paragraph of this Agreement.
 
“ Commitment ” means, with respect to any Lender, the amount specified opposite such Lender’s name on Schedule I hereto or, if such Lender has entered into any Assignment and Acceptance, set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 8.07(d), as such amount may be reduced pursuant to Section 2.01(b).  The aggregate amount of the Commitments on the date hereof is $700,000,000.
 
“ Communications ” means each notice, demand, communication, information, document and other material provided for hereunder or under any other Loan Document or otherwise transmitted between the parties hereto relating to this Agreement, the other Loan Documents, any Loan Party or its Affiliates, or the transactions contemplated by this Agreement or the other Loan Documents including, without limitation, all Approved Electronic Communications.
 
“ Consolidated Net Worth ” means the excess over current liabilities of all assets properly appearing on a consolidated balance sheet of the Company and its Subsidiaries after deducting the minority interests of others in Subsidiaries.
 
“ Consolidated Subsidiary ” means at any date any Subsidiary or other entity the financial statements of which would, under GAAP, be consolidated with those of the Company in its consolidated financial statements as of such date.
 
“ Contingent Obligation ” as to any Person means any obligation of such Person guaranteeing or intended to guarantee any Indebtedness, leases, dividends or other obligations (“ primary obligations ”) of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (x) for the purchase or payment of any such primary obligation or (y) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of such primary obligation against loss in respect thereof; provided , however , that the term Contingent Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.
 
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“ Continuing Director ” means any member of the Board of Directors of the Company who is not affiliated with an Acquiring Person and who is a member of the Board of Directors of the Company immediately prior to the time that the Acquiring Person became an Acquiring Person and any successor to a Continuing Director who is not affiliated with the Acquiring Person and is recommended to succeed a Continuing Director by a majority of Continuing Directors who are then members of the Board of Directors of the Company.
 
“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise.  “ Controlling ” and “ Controlled ” have meanings correlative thereto.
 
“ Currency ” means either Dollars or an Alternate Currency.
 
“ Default ” means an event which would constitute an Event of Default but for the giving of notice, the lapse of time or both.
 
“ Designated Borrowers ” means any Subsidiary of the Company as to which a Designation Letter has been delivered to the Administrative Agent in accordance with and together with the other documents required by Section 2.14, and no Termination Letter has been delivered to the Administrative Agent thereunder.
 
“ Designation Letter ” has the meaning provided in Section 2.l4.
 
“ Dollar Equivalent ” means, with respect to any amount denominated in an Alternate Currency on any date, the amount of Dollars that would be required to purchase such amount of such Alternate Currency at or about 11:00 A.M. (Local Time) on such date, for delivery two Business Days later, as determined by the Administrative Agent on the basis of the spot selling rate for the offering of such Alternate Currency for Dollars in the London foreign exchange market, determinations thereof made in good faith by the Administrative Agent to be conclusive and binding on the parties in the absence of manifest error.
 
“ Dollars ” and “ $ ” mean lawful money of the United States of America.
 
 
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“ Domestic Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Domestic Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender, or such other office of such Lender as such Lender may from time to time specify in writing to the Company and the Administrative Agent.
 
“ EBITDA ” means, for any period, the sum (without duplication) for the Company and its Consolidated Subsidiaries on a consolidated basis of the following: (a) net income for such period plus (b) to the extent deducted in determining net income for such period, the sum of (i) depreciation and amortization for such period, (ii) Interest Expense for such period and (iii) taxes for such period.  Notwithstanding the foregoing, (1) in calculating EBITDA for any period that includes one or more Restructuring Periods, EBITDA shall be increased by an amount equal to the Applicable Restructuring Charges for any such Restructuring Periods, (2) in calculating EBITDA for any period, any impairment charges or asset write-offs, in each case pursuant to Financial Accounting Standards Board’s Staff Position Accounting Principles Board Opinion No. 144 (“Accounting for the Impairment or Disposal of Long-Lived Assets (Issued 8/01)”), shall be excluded, (3) in calculating EBITDA for any period, non-cash charges arising from purchase accounting adjustments (including the effects of such adjustments pushed down to such Person and its Subsidiaries) in component amounts required or permitted by GAAP, resulting from the write-up of assets or application of purchase accounting in relation to any consummated acquisition or the amortization, depreciation, or write-off of any amounts thereof, net of taxes, shall be excluded, and (4) in calculating EBITDA for any period, charges associated with stock-based compensation shall be excluded.  For the purpose of calculating EBITDA for any period following the acquisition of The Black & Decker Corporation, EBITDA for such period shall be calculated after giving pro forma effect to such acquisition as if such acquisition occurred on the first day of such period.
 
“ Effective Date ” has the meaning provided in Section 3.01.
 
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, or any successors thereto, and the regulations promulgated and the rulings found thereunder.
 
“ ERISA Controlled Group ” means a group consisting of any ERISA Person and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control with such Person that, together with such Person, are treated as a single employer under regulations promulgated under ERISA.
 
“ ERISA Person ” has the meaning provided in Section 3(9) of ERISA for the term “person.”
 
“ ERISA Plan ” means (i) any Plan that (x) is not a Multiemployer Plan and (y) has Unfunded Benefit Liabilities in excess of $20,000,000 and (ii) any Plan that is a Multiemployer Plan.
 
“ ESOP ” means Stanley Account Value Plan or any successor plan.
 
“ Euro ” has the meaning provided in Section 2.15.
 
 
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“ Eurocurrency Liabilities ” has the meaning provided in Regulation D (or any successor regulation) of the Federal Reserve Board, as in effect from time to time.
 
“ Eurocurrency Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Eurocurrency Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender (or, if no such office of such Lender is specified, its Domestic Lending Office), or such other office of such Lender as such Lender may from time to time specify in writing to the Company and the Administrative Agent.
 
“ Eurocurrency Rate ” means, for any Interest Period:

(a)  for each Eurocurrency Rate Advance denominated in Dollars comprising part of the same Borrowing, an interest rate per annum equal to the offered rate for deposits in such Currency as quoted on the relevant Screen Page at 11:00 A.M. (London time) two London Banking Days before the first day of such Interest Period in an amount substantially equal to the Reference Bank’s Eurocurrency Rate Advance comprising part of such Borrowing to be outstanding during such Interest Period and for a period equal to such Interest Period;

(b)  for each Eurocurrency Rate Advance denominated in Pounds Sterling comprising part of the same Borrowing, (i) an interest rate per annum equal to the offered rate for deposits in such Currency as quoted on the relevant Screen Page at 11:00 A.M. (London time) on the first day of such Interest Period, for a period equal to such Interest Period   plus (ii) the MCR Cost, if any; or

(c)  for each Eurocurrency Rate Advance denominated in Euros comprising part of the same Borrowing, (i) an interest rate per annum equal to the offered rate for deposits in such Currency as quoted on the relevant Screen Page at 11:00 A.M. (Brussels time) two TARGET Days before the first day of such Interest Period, for a period equal to such Interest Period plus (ii) the MCR Cost, if any.
 
“ Eurocurrency Rate Advance ” means an Advance that bears interest as provided in Section 2.05(b).
 
“ Eurocurrency Rate Reserve Percentage ” for any Lender for any Eurocurrency Rate Advances owing to such Lender means the reserve percentage applicable two Business Days before the first day of the applicable Interest Period under regulations issued from time to time by the Federal Reserve Board for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for such Lender with respect to liabilities or assets consisting of or including Eurocurrency Liabilities having a term equal to the applicable Interest Period.
 
“ Events of Default ” has the meaning provided in Section 6.01.
 
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended form time to time, and the rules and regulations promulgated thereunder from time to time in effect.
 
 
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“ Excluded Representation ” means the representation and warranty set forth in Section 4.01(g).
 
“ Federal Bankruptcy Code ” means Title 11 of the United States Code entitled “Bankruptcy”, as amended from time to time, or any successor thereto.
 
“ Federal Funds Rate ” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve Board arranged by Federal fund brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Reference Bank from three Federal funds brokers of recognized standing selected by the Reference Bank.
 
“ Federal Reserve Board ” means the Board of Governors of the Federal Reserve System as constituted from time to time.
 
“ Fitch ” means Fitch Ratings Ltd. and any successor or successors thereto.
 
“ Floor ” means, on any date, a rate per annum equal to
 
(i) 0.750% if on such date the Company’s outstanding Long-Term Indebtedness is rated A- or higher by Standard & Poor’s, A3 or higher by Moody’s, or A- or higher by Fitch,
 
(ii) 1.000% if on such date clause (i) is inapplicable and the Company’s outstanding Long-Term Indebtedness is rated BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and
 
(iii) 1.500% if on such date clauses (i) and (ii) are inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency);
 
provided   that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Floor” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
“ Foreign Currency Equivalent ” means, with respect to any amount in Dollars, the amount of an Alternate Currency that could be purchased with such amount of Dollars using the reciprocal of the foreign exchange rate specified in the definition of “Dollar Equivalent”, as determined by the Administrative Agent, such determinations to be conclusive and binding on the parties in the absence of manifest error.
 
“ Foreign Currency Sublimit ” means the aggregate principal amount of Advances denominated in Alternate Currencies permitted to be outstanding at any one time.  The Foreign Currency Sublimit on the date hereof is $250,000,000.
 
 
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“ GAAP ” means United States generally accepted accounting principles as in effect from time to time.
 
“ Guarantors ” means, collectively, the Company and the Subsidiary Guarantor.
 
“ Hedge Agreements ” means interest rate swap, cap or collar agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts and other similar agreements.
 
“ Indebtedness ” of any Person means, without duplication, (i) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business of such Person), (ii) all indebtedness of such Person evidenced by a note, bond, debenture or similar instrument, (iii) the principal component of all Capital Lease obligations of such Person, (iv) the face amount of all letters of credit issued for the account of such Person and, without duplication, all unreimbursed amounts drawn thereunder, (v) all indebtedness of any other Person secured by any Lien on any property owned by such Person, whether or not such indebtedness has been assumed, (vi) all Contingent Obligations of such Person, and (vii) all indebtedness of such Person in respect of Hedge Agreements.
 
“ Information ” has the meaning provided in Section 8.02(d).
 
“ Information Memorandum ” means the document in the form approved by the Company concerning the Loan Parties and their Subsidiaries which, at the Company’s request and on its behalf, was prepared in relation to this transaction and distributed by the Lead Arrangers to selected financial institutions before the date of this Agreement.
 
“ Initial Lenders ” has the meaning provided in the first paragraph of this Agreement.
 
“ Interest Coverage Ratio ” means, for any period of four consecutive fiscal quarters, the ratio of (a) EBITDA for such period to (b) Interest Expense for such period.
 
“ Interest Expense ” means, for any period, the sum (determined without duplication) of the aggregate amount of interest reported in respect of such period on the Indebtedness of the Company and its Consolidated Subsidiaries on a consolidated basis, including, without limitation, the interest portion of payments under Capital Lease obligations and any capitalized interest but excluding imputed (non-cash) interest expense in respect of convertible bonds issued by the Company or any of its Consolidated Subsidiaries as calculated in accordance with the Financial Accounting Standards Board’s Staff Position Accounting Principles Board Opinion No. 14-1 (“Accounting for Convertible Debt Instruments That May be Settled in Cash upon Conversion (Including Partial Cash Settlement)”), minus (i) interest income of the Company and its Consolidated Subsidiaries on a consolidated basis reported in respect of such period, (ii) interest on deferred compensation reported in respect of such period, and (iii) any income/expense in respect of such period associated with spot-to-forward differences or points on foreign currency trades that are included in interest income/expense as a result of Statement of Financial Accounting Standards No. 133, as amended and interpreted.  For the purpose of calculating Interest Expense for any period following the acquisition of The Black & Decker Corporation, Interest Expense for such period shall be calculated after giving pro forma effect to such acquisition as if such acquisition occurred on the first day of such period.
 
 
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“ Interest Period ” means, for each Eurocurrency Rate Advance comprising part of the same Borrowing, the period commencing on the date of such Advance or the date of the continuation of such Eurocurrency Rate Advance or the date of the conversion of any Base Rate Advance into such Eurocurrency Rate Advance and ending on the last day of the period selected by a Borrower pursuant to the provisions below.  The duration of each such Interest Period shall be one, two, three or six months as a Borrower may select in the Notice of Borrowing or Notice of Conversion or Continuation for such Advance, as the case may be; provided that:
 
 
(i)  a Borrower may not select any Interest Period which ends after the Termination Date or, if the Advances have been converted to a term loan pursuant to Section 2.07(a) prior to such selection, that ends after the Maturity Date;

 
(ii)  whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day; provided that if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day;

 
(iii)  any Interest Period which begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to clause (iv) below, end on the last Business Day of a calendar month;

 
(iv)  (A) any Interest Period which would otherwise end after the Termination Date shall end on the Termination Date or (B) if the Advances have been converted to a term loan pursuant to Section 2.07(a) prior to such selection, any Interest Period which would otherwise end after the Maturity Date shall end on the Maturity Date;

 
(v)  if, upon the expiration of any Interest Period with respect to a Borrowing, a Borrower has failed to elect a new Interest Period to be applicable to such Advances as provided above, such Borrower (x) if such Borrower is the Company, shall be deemed to have elected to convert such Advances into a Base Rate Advance effective as of the expiration date of such current Interest Period and (y) if such Borrower is a Designated Subsidiary, shall be deemed to have elected a new Interest Period of 1 month to be applicable to such Advances; and

 
(vi)  Interest Periods commencing on the same date for Eurocurrency Rate Advances comprising part of the same Borrowing shall be of the same duration.

“ Internal Revenue Code ” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.
 
“ Lender Appointment Period ” has the meaning provided in Section 7.07.
 
“ Lenders ” means the Initial Lenders and each Person that shall become a party hereto pursuant to Section 8.07.
 
“ Lien ” shall mean any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preferential payment arrangement, priority or other security agreement of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same effect as any of the foregoing and the filing of any financing statement or similar instrument under the Uniform Commercial Code or comparable law of any jurisdiction, domestic or foreign.
 
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“ Loan Documents ” means, collectively, this Agreement, the Notes, each Designation Letter and each Termination Letter.
 
“ Loan Parties ” means, collectively, the Borrowers and the Guarantors.
 
“ Local Time ” means (a) with respect to any Advance denominated or any payment to be made in Dollars, New York City time, and (b) with respect to any Advance denominated or any payment to be made in an Alternate Currency, the local time in the Principal Financial Center for such Alternate Currency.
 
“ London Banking Day ” means any day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) in London.
 
“ Long-Term Indebtedness ” means the long-term Senior Unsecured Indebtedness of the Company.
 
“ Margin Stock ” has the meaning provided in Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.
 
“ Material Adverse Effect ” means a material adverse effect on the business, financial condition or results of operations of the Company and its Consolidated Subsidiaries taken as a whole.
 
“ Maturity Date ” means the earlier of (a) the date selected by the Company and notified to the Administrative Agent in the Term Loan Election, but not later than the first anniversary of the Termination Date and (b) the date of termination in whole of the aggregate Commitments pursuant to Section 2.01(b) or 6.01.
 
“ MCR Cost ” means, the percentage rate per annum calculated by the Administrative Agent in accordance with Schedule II.
 
“ Moody’s ” means Moody’s Investors Service, Inc. and any successor or successors thereto.
 
“ Multiemployer Plan ” means a Plan which is a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA.
 
“ Note ” has the meaning provided in Section 2.11.
 
“ Notice of Borrowing ” has the meaning provided in Section 2.02(b).
 
“ Notice of Conversion or Continuation ” has the meaning provided in Section 2.04(b).
 
“ Other Taxes ” has the meaning provided in Section 2.10(b).
 
 
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“ PBGC ” means the Pension Benefit Guaranty Corporation established under ERISA, or any successor thereto.
 
“ Person ” means an individual, partnership, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, limited liability company or other entity, or a government or any political subdivision or agency thereof.
 
“ Plan ” means any employee benefit plan covered by Title IV of ERISA, the funding requirements of which:
 
 
(i)  were the responsibility of the Company or a member of its ERISA Controlled Group at any time within the five years immediately preceding the date hereof,
 
 
(ii)  are currently the responsibility of the Company or a member of its ERISA Controlled Group, or
 
 
(iii)  hereafter become the responsibility of the Company or a member of its ERISA Controlled Group, including any such plans as may have been, or may hereafter be, terminated for whatever reason.
 
“ Pounds Sterling ” means the lawful currency of the United Kingdom.
 
“ Principal Financial Center ” means, in the case of any Currency, the principal financial center in the country of issue of such Currency, as reasonably determined by the Administrative Agent.
 
“ Principal Property ” means all real property and tangible personal property constituting a manufacturing plant owned by the Company or any of its Subsidiaries, exclusive of (i) motor vehicles, mobile materials handling equipment and other rolling stock, (ii) office furnishings and equipment, information and electronic data processing equipment, (iii) any property financed through obligations issued by a state, territory or possession of the United States, or any political subdivision or instrumentality of the foregoing, on which the interest cannot, in the opinion of tax counsel of recognized standing or in accordance with a ruling issued by the Internal Revenue Service, be included in gross income of the holder under Section 103(a)(1) of the Internal Revenue Code (or any successor to such provision) as in effect at the time of the issuance of such obligations, (iv) any real property held for development or sale, or (v) any property and equipment included therein without deduction of any depreciation reserves the book value of which property and equipment in the aggregate is less than 10% of Consolidated Net Worth or which the Board of Directors of the Company determines is not material to the operation of the business of the Company and its Subsidiaries taken as a whole.
 
“ Principal Subsidiary ” means any Subsidiary of the Company which has net sales which represent 15% or more of the consolidated net sales of the Company and its Consolidated Subsidiaries taken as a whole.
 
“ Process Agent ” has the meaning provided in Section 8.13(b).
 
“ Pro Rata Share ” means, with respect to any Lender, the percentage corresponding to the fraction the numerator of which shall be the amount of the Commitment of such Lender and the denominator of which shall be the aggregate amount of the Commitments of all Lenders.
 
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“ Rate Notification ” has the meaning provided in Section 2.02(a).
 
“ Rate Request ” has the meaning provided in Section 2.02(a).
 
“ Reference Bank ” means Citibank or, if Citibank is no longer the Administrative Agent, such Person (which shall be a Lender or the Administrative Agent) as shall be designated by the Company with the consent of the Required Lenders, which consent shall not be unreasonably withheld.
 
“ Register ” has the meaning provided in Section 8.07(d).
 
“ Related Parties ” means, with respect to any Person, such Person’s Affiliates and such Person’s and such Person’s Affiliates’ respective managers, administrators, trustees,  partners, directors, officers, employees, agents, fund managers and advisors.
 
“ Reportable Event ” has the meaning provided in Section 4043(b) of ERISA (other than a Reportable Event as to which the provision of 30 days notice to the PBGC is waived under applicable regulations).
 
“ Required Lenders ” means at any time Lenders representing in the aggregate at least 51% of the Commitments or, if the Commitments shall have terminated, Lenders representing in the aggregate at least 51% of the sum of the Advances owing to Lenders hereunder (computed, in the case of Advances in an Alternate Currency, as the Dollar Equivalent thereof as determined by the Administrative Agent).
 
“ Restricting Information ” has the meaning provided in Section 8.02(d).
 
“ Restructuring Period ” means (a) if the Company reports taking any restructuring charges during any quarter of its fiscal year 2009 in the Company’s Exchange Act disclosure documents filed with the Securities and Exchange Commission on Forms 8K, 10K or 10Q (or their equivalents) (the Company’s “ SEC Filings ”), each such fiscal quarter of the Company during its fiscal year 2009, and (b) each fiscal quarter of the Company during fiscal years 2010, 2011, 2012, and 2013.
 
“ Screen Page ” means the display designated as Reuters LIBOR01 Page or EURIBOR01 Page, as the case may be (or such other page as may replace that page for the purpose of displaying London interbank offered rates or the Euro interbank offered rates of major banks).  If more than one relevant rate appears on said LIBOR01 Page or EURIBOR01 Page with respect to an Interest Period, the Eurocurrency Rate for that Interest Period will be based upon the arithmetic mean of such relevant rates.
 
“ SEC Filings ” has the meaning provided in the definition of “Restructuring Period”.
 
“ Senior Unsecured Indebtedness ” means Indebtedness that is not subordinated to any other Indebtedness and is not secured or supported by a guarantee, letter of credit or other form of credit enhancement.
 
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“ Standard & Poor’s ” means Standard & Poor’s Ratings Services and any successor or successors thereto.
 
“ Subsidiary ” of any Person means (i) any corporation 50% or more of whose stock of any class or classes having by the terms thereof ordinary voting power to elect a majority of the directors of such corporation (irrespective of whether or not at the time stock of any class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time owned by such Person directly or indirectly through Subsidiaries and (ii) any partnership, association, joint venture, limited liability company or other entity in which such Person, directly or indirectly through Subsidiaries, is either a general partner or has a 50% or more equity interest at the time.
 
“ TARGET ” means Trans–European Automated Real–time Gross Settlement Express Transfer payment system.
 
“ TARGET Day ” means any day on which TARGET is open for the settlement of  payments in Euros.
 
“ Target Operating Day ” has the meaning provided in Section 2.15.
 
“ Taxes ” has the meaning provided in Section 2.10(a).
 
“ Term Loan Conversion Date ” means the Termination Date, if on such date all Advances outstanding on such date are converted into a term loan pursuant to Section 2.07(a).
 
“ Term Loan Election ” has the meaning specified in Section 2.07(a).
 
“ Termination Date ” means the earlier of (a) March [11], 2011 or (b) the date of termination in whole of the Commitments pursuant to Section 2.01(b) or Section 6.01.
 
“ Termination Event ” means (i) a Reportable Event, or (ii) the initiation of any action by the Company, any member of the Company’s ERISA Controlled Group or any ERISA Plan fiduciary to terminate an ERISA Plan or the treatment of an amendment to an ERISA Plan as a termination under ERISA, or (iii) the institution of proceedings by the PBGC under Section 4042 of ERISA to terminate an ERISA Plan or to appoint a trustee to administer any ERISA Plan.
 
“ Termination Letter ” has the meaning provided in Section 2.14.
 
“ Type ” has the meaning provided in the definition of Advance.
 
“ Unfunded Benefit Liabilities ” means with respect to any Plan at any time, the amount (if any) by which (i) the present value of all benefit liabilities under such Plan as defined in Section 4001(a)(16) of ERISA, exceeds (ii) the fair market value of all Plan assets allocable to such benefits, all determined as of the then most recent valuation date for such Plan (on the basis of assumptions prescribed by the PBGC for the purpose of Section 4044 of ERISA).
 
 
 
 
SECTION 1.02   Computation of Time Periods; Terms Generally .   In this Agreement in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.
 
SECTION 1.03   Accounting Terms .  All accounting terms not specifically defined herein shall be construed in accordance with GAAP.
 

ARTICLE II
 
AMOUNTS AND TERMS OF THE ADVANCES
 
SECTION 2.01   The Commitment .   (a)   The Advances .  (i)  Each Lender agrees, on the terms and conditions hereinafter set forth to make Advances to the Company and any Designated Borrower in Dollars or an Alternate Currency from time to time on any Business Day during the period from the Effective Date until the Termination Date in an aggregate amount not to exceed at any time outstanding such Lender’s Commitment; provided that (A) at no time shall the aggregate outstanding principal amount of all Advances exceed the total amount of the Commitments at such time; and (B) at no time shall the Dollar Equivalent of the aggregate outstanding principal amount of all Advances denominated in an Alternate Currency to the Borrowers exceed the Foreign Currency Sublimit.
 
(ii)           Within the limits of each Lender’s Commitment and subject to the limitation set forth in Section 2.07(c), each Borrower may borrow, repay, prepay (as provided in Section 2.07) and reborrow such amount or any portion thereof.
 
(iii)           Each Borrowing shall be in an aggregate amount of $10,000,000 or an integral multiple of $1,000,000 in excess thereof (or, in the case of a Borrowing denominated in an Alternate Currency, the Foreign Currency Equivalent thereof in such Alternate Currency, rounded to the nearest 1,000,000 units of such Alternate Currency) or, if less, the aggregate amount of the unused Commitments and shall consist of Advances of the same Type made on the same day by the Lenders ratably according to their respective Commitments.
 
(b)           Termination and Reduction.  The Company shall have the right, upon at least three Business Days’ notice to the Administrative Agent, to terminate in whole or reduce each Lender’s Pro Rata Share of the unused Commitments.  Each partial reduction of the Commitments shall be in the aggregate amount of at least $10,000,000 or a larger whole multiple of $1,000,000.  On the Termination Date, if the Borrower has made the Term Loan Election in accordance with Section 2.07(a) prior to such date, and from time to time thereafter upon each prepayment of the Advances, the Commitments of the Lenders shall be automatically and permanently reduced on a pro rata basis by an amount equal to the amount by which (i) the aggregate Commitments immediately prior to such reduction exceeds (ii) the aggregate unpaid principal amount of all Advances outstanding at such time.
 
SECTION 2.02   Making the Advances .   (a)   Determination of Eurocurrency Rate .  The Company (on its own behalf or on behalf of any Designated Borrower) may request the Reference Bank, no earlier than 9:00 A.M. (New York City time) and no later than 11:00 A.M. (New York City time) on the third Business Day before a proposed Eurocurrency Rate Advance, to notify the Company of the Eurocurrency Rate that would be applicable to an Advance in the principal amount, in the Currency, and with the Interest Period as described by the Company in such request, which request shall be substantially in the form of Exhibit A-1 hereto (a “ Rate Request ”).  Upon such request, the Reference Bank shall furnish such interest rate to the Company no later than noon (New York City time) on the second Business Day before the proposed Eurocurrency Rate Advance by delivering to the Company a copy of the related Rate Request setting forth such rate and executed by an authorized officer of the Reference Bank in the space provided therefor (a “ Rate Notification ”).  The relevant Borrower shall be entitled to rely on any such notification and such rate shall be conclusive and binding on the Lenders absent manifest error.
 
 
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(b)           Notice of Borrowing.  Each Borrowing shall be made on notice by the Company (on its own behalf or on behalf of any Designated Borrower) to the Administrative Agent, which shall give to each Lender prompt notice thereof by telecopier, given not later than 11:00 A.M. (New York City time) on the date of the proposed Borrowing if such Borrowing is to be comprised of Base Rate Advances and no earlier than 9:00 A.M. (New York City time) and no later than 4:00 P.M. (New York City time) on the third Business Day prior to such date if such Borrowing is to be comprised of Eurocurrency Rate Advances.  Each such notice of a Borrowing (a “Notice of Borrowing”) shall be by telecopier, or by telephone confirmed immediately in writing, in substantially the form of Exhibit A-2 hereto, specifying therein:  (i) the name of the Borrower (which shall be the Company or a Designated Borrower), (ii) the requested date of such Borrowing, (iii) the Type of Advances comprising such Borrowing, (iv) the aggregate amount and, for any Designated Borrower, the Currency of such Borrowing, and (v) in the case of a Borrowing consisting of Eurocurrency Rate Advances, the initial Interest Period for each such Advance.  Each Lender shall, before 1:00 P.M. (Local Time) on the date of such Borrowing, make available for the account of its Applicable Lending Office to the Administrative Agent at the Administrative Agent’s Account for Advances denominated in the relevant Currency, in the relevant Currency and in same day funds, such Lender’s Pro Rata Share of the requested amount of such Borrowing.  Promptly after the Administrative Agent’s receipt of such funds (and in any event by the close of business New York City time on the date of such Borrowing) and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make the funds so received available to the Company or such other Borrower by depositing the same in such Currency and in immediately available funds into such account of the Company or such other Borrower, as applicable, maintained with the Administrative Agent in New York City (if such Advance is denominated in Dollars) or in the Principal Financial Center for any other Currency (if such Advance is denominated in an Alternate Currency) as shall have been specified in the related Notice of Borrowing.
 
(c)           Illegality, Etc.  Anything in subsection (a) or (b) above to the contrary notwithstanding,
 
(i)           if any Lender shall, at least one Business Day before the date of any requested Eurocurrency Advance or the date of any conversion to or continuation of a Eurocurrency Rate Advance, notify the Administrative Agent that the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or that any central bank or other governmental authority asserts that it is unlawful, for such Lender or its Eurocurrency Lending Office to perform its obligations hereunder to make Eurocurrency Rate Advances or to fund or maintain Eurocurrency Rate Advances hereunder, the Administrative Agent shall forthwith give notice thereof to the other Lenders and the Company, whereupon (A) such Lender shall have no obligation to make Eurocurrency Rate Advances, or to convert Advances into Eurocurrency Rate Advances, until such Lender notifies the Company and the Administrative Agent that the circumstances causing such suspension no longer exist and (B) each Borrower shall be deemed to have converted all Eurocurrency Rate Advances of such Lender then outstanding into Base Rate Advances in accordance with Section 2.04 on and as of the date of the Administrative Agent’s receipt of such notice, unless and to the extent such notice directs that one or more Eurocurrency Rate Advances shall be so converted on the last day of the applicable Interest Period, provided that (w) before giving any such notice, such Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Applicable Lending Office if the making of such a designation would avoid the need for such suspension and conversion and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender, (x) any request by a Borrower for Eurocurrency Rate Advances during a time when a Lender’s obligation to make, or convert Advances into, Eurocurrency Rate Advances shall be suspended hereunder shall be deemed to be a request for, or for conversion into, Base Rate Advances from such Lender, (y) all Advances that would otherwise be made by such Lender as Eurocurrency Rate Advances during any such suspension shall instead be made as Base Rate Advances and (z)  in the event any Lender shall notify the Administrative Agent and the Company of the occurrence of the circumstances causing such suspension under this Section 2.02(c), all payments and prepayments of principal that would otherwise have been applied to repay the Eurocurrency Rate Advances that would have been made by such Lender or the converted Eurocurrency Rate Advances shall instead be applied to repay the Base Rate Advances made by such Lender in lieu of, or resulting from the conversion of, such Eurocurrency Rate Advances;
 
 
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(ii)           if the Reference Bank cannot furnish the Eurocurrency Rate for any Borrowing consisting of Eurocurrency Rate Advances because of conditions existing in the London interbank market, the right of the Borrowers to select Eurocurrency Rate Advances shall be suspended until the Reference Bank shall notify the Company and the Lenders that the circumstances causing such suspension no longer exist;
 
(iii)           if the Required Lenders shall, at least one Business Day before the date of any requested Eurocurrency Rate Advance, notify the Administrative Agent that the Eurocurrency Rate for any Interest Period will not adequately reflect the cost to the Required Lenders of making, funding or maintaining their respective Eurocurrency Rate Advances for such Interest Period, the Administrative Agent shall forthwith so notify the Company and the Lenders, whereupon the Lenders shall have no obligation to make, or convert Advances into, Eurocurrency Rate Advances until the Administrative Agent shall notify the Company and the Lenders that the circumstances causing such suspension no longer exist; and
 
(iv)           if the Required Lenders shall, at least one Business Day before the date of any Advance to a Designated Borrower, notify the Administrative Agent that the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or that any central bank or other governmental authority asserts that it is unlawful, for such Lenders to perform their obligations hereunder to make Advances or to fund or maintain Advances hereunder to such Designated Borrower, the Administrative Agent shall forthwith give notice thereof to the other Lenders and the Company, whereupon the Lenders shall have no obligation to make Advances to such Designated Borrower, until the Administrative Agent shall notify the Company and the Lenders that the circumstances causing such suspension no longer exist.
 
 
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(d)           Effect of Failure to Fulfill Conditions.  Each Notice of Borrowing shall be irrevocable and binding on the Company and the relevant Designated Borrower.  In the case of any Borrowing that the related Notice of Borrowing specifies is to be comprised of Eurocurrency Rate Advances, the relevant Borrower shall indemnify each Lender against any loss, cost or expense incurred by such Lender as a result of any failure to fulfill on or before the date specified in such Notice of Borrowing for such Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss (excluding anticipated profits), cost or expense reasonably incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Advance to be made by such Lender as part of such Borrowing when such Advance, as a result of such failure, is not made on such date, such indemnity to be paid promptly upon receipt by the relevant Borrower of a certificate of such Lender setting forth the calculation of the amount of the indemnity claimed by such Lender.
 
(e)           Funds Available.  Unless the Administrative Agent shall have received notice from a Lender prior to 1:00 P.M. (New York City time) on the date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s ratable portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with subsection (a) of this Section 2.02 and the Administrative Agent may, in reliance upon such assumption, make available to the relevant Borrower on such date a corresponding amount.  If and to the extent that such Lender shall not have so made such ratable portion available to the Administrative Agent, such Lender and the relevant Borrower severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the relevant Borrower until the date such amount is repaid to the Administrative Agent, at (i) in the case of the relevant Borrower, the interest rate applicable at the time to Advances comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate.  If such Lender shall repay to the Administrative Agent such corresponding amount, such amount so repaid shall constitute such Lender’s Advance as part of such Borrowing for purposes of this Agreement.
 
(f)           Failure to Make Advances.  The failure of any Lender to make the Advance to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on the date of any Borrowing.
 
SECTION 2.03   Fees .  (a)   Facility Fee .  The Company agrees to pay to the Administrative Agent for the account of each Lender a facility fee in Dollars on the aggregate amount of such Lender’s Commitment (whether or not utilized and, after the Termination Date (if the Term Loan Conversion Date has not occurred), on the aggregate outstanding principal amount of the Advances of such Lender, if any) from the date hereof in the case of each Lender and, in the case of each Person which becomes a Lender pursuant to Section 8.07, from the effective date specified in the Assignment and Acceptance pursuant to which it became a Lender, until the Termination Date at the Applicable Facility Fee Rate, payable quarterly in arrears on the last day of each March, June, September and December during the term hereof and on the Termination Date.  All computations of the facility fee shall be based on a year of 360 days.
 
 
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(b)           Administrative Agent’s Fees.  The Company shall pay to the Administrative Agent in Dollars for its own account such fees as may from time to time be agreed between the Company and the Administrative Agent.
 
SECTION 2.04   Continuation and Conversion .   (a)   General .  Subject to the other provisions hereof, each Borrower shall have the option (i) to convert all or any part of an outstanding Borrowing consisting of Base Rate Advances to a Borrowing consisting of Eurocurrency Rate Advances, (ii) to convert all or any part of an outstanding Borrowing in Dollars consisting of Eurocurrency Rate Advances to a Borrowing consisting of Base Rate Advances, or (iii) to continue all or any part of an outstanding Borrowing consisting of Eurocurrency Rate Advances as a Borrowing consisting of Eurocurrency Rate Advances for an additional Interest Period; provided that no Borrowing consisting of Eurocurrency Rate Advances shall be so converted other than as contemplated by Section 2.02(c) or continued, until the expiration of the Interest Period applicable thereto.
 
(b)           Notice of Conversion or Continuation.  In order to elect to convert or continue a Borrowing hereunder, the Company (on its own behalf or on behalf of any Designated Borrower) shall deliver an irrevocable notice thereof (a “Notice of Conversion or Continuation”) to the Administrative Agent by telecopier or by telephone confirmed immediately in writing, no later than (i) 11:00 A.M., (New York City time) on the proposed conversion date in the case of a conversion to Base Rate Advances and (ii) no earlier than 9:00 A.M. (New York City time) and no later than 4:00 P.M. (New York City time) on the third Business Day in advance of the proposed conversion or continuation date in the case of a conversion to, or a continuation of, Eurocurrency Rate Advances, substantially in the form of Exhibit B hereto.  A Notice of Conversion or Continuation shall specify (w) the requested conversion or continuation date (which shall be a Business Day), (x) the amount and Type of the Advances to be converted or continued, (y) whether a conversion or continuation is requested, and (z) in the case of a conversion to, or a continuation of, Eurocurrency Rate Advances, the requested Interest Period.  The relevant Eurocurrency Rate for such Interest Period in the case of a conversion to, or a continuation of, Eurocurrency Rate Advances shall be determined in the manner provided in Section 2.02(a) as if such conversion or continuation is instead new Eurocurrency Rate Advances in such amount, on such date and for such Interest Period.  If the Company fails to give a Notice of Conversion or Continuation with respect to an outstanding Borrowing consisting of Eurocurrency Rate Advances in Dollars as provided in clause (ii) above, the Company shall be deemed to have converted such Eurocurrency Rate Advances into Base Rate Advances in accordance with this Section 2.04 if such Advances are outstanding after the last day of the Interest Period with respect thereto.  If the Company fails to give a Notice of Conversion or Continuation with respect to an outstanding Borrowing consisting of Eurocurrency Rate Advances in an Alternate Currency as provided in clause (ii) above, the Company shall be deemed to have converted such Eurocurrency Rate Advances into a Eurocurrency Rate Advance with an Interest Period of one (1) month in accordance with this Section 2.04 if such Advances are outstanding after the last day of the Interest Period with respect thereto.
 
 
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SECTION 2.05   Interest on Advances .   Each Borrower shall pay interest on the unpaid principal amount of each Advance owing to each Lender from the date the proceeds of such Advance are made available to such Borrower until such principal amount shall be paid in full, at the following rates per annum:
 

(a)           Base Rate Advances.  If such Advance is a Base Rate Advance, a rate per annum equal to the Base Rate in effect from time to time plus the Applicable Base Rate Margin, payable in arrears quarterly on the last Business Day of each fiscal quarter during the period such Base Rate Advance remains outstanding and on the date such Base Rate Advance shall be paid in full;
 
(b)           Eurocurrency Rate Advances.  If such Advance is a Eurocurrency Rate Advance, a rate per annum equal at all times during the Interest Period for such Advance to the sum of the Eurocurrency Rate for such Interest Period plus the Applicable Eurocurrency Margin for such Interest Period, payable in arrears on the last day of such Interest Period and, if such Interest Period has a duration of more than three months, on each day which occurs during such Interest Period every three months from the first day of such Interest Period;
 
(c)           Default Rate.  In the event that, and for so long as, any Event of Default shall have occurred and be continuing, the outstanding principal amount of all Advances and, to the extent permitted by law, overdue interest in respect of all Advances, shall bear interest at a rate per annum equal to the sum of two percent (2%) plus the interest rate otherwise applicable hereunder to such principal amount in effect from time to time.  In the event that, and for so long as, any Default under Section 6.01(a) shall have occurred and be continuing, the outstanding principal amount of the Advance with respect to which such Default has occurred and is continuing shall bear interest at a rate per annum equal to the sum of two percent (2%) plus the interest rate otherwise applicable hereunder to such principal amount in effect from time to time.
 
SECTION 2.06   Additional Interest on Eurocurrency Rate Advances .   Each Borrower shall pay to each Lender, during each period as such Lender shall be required under regulations of the Federal Reserve Board to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Liabilities, additional interest on the unpaid principal amount of each Eurocurrency Rate Advance of such Lender outstanding during such period, from the later of the date such reserves are required and the making of such Advance until the earlier of the date such reserves are no longer required and such principal amount is paid in full, at an interest rate per annum equal at all times to the remainder obtained by subtracting (i) the Eurocurrency Rate for the Interest Period applicable to such Advance from (ii) the rate obtained by dividing such Eurocurrency Rate by a percentage equal to 100% minus the average Eurocurrency Rate Reserve Percentage of such Lender during such period, payable on each date on which interest is payable on such Advance.  Such Lender shall determine the amount of such additional interest, if any, and promptly notify the relevant Borrower through the Administrative Agent of the amount thereof.
 
SECTION 2.07   Repayment; Prepayment of Advances; Etc .   (a)   Repayment .  Each Borrower shall, subject to the next succeeding sentence, repay to the Administrative Agent for the ratable account of the Lenders on the Termination Date the aggregate principal amount of the Advances then outstanding.  The Company may, upon not less than 15 days’ notice to the Administrative Agent, elect (the “ Term Loan Election ”) to convert all of the Advances outstanding on the Termination Date in effect at such time into a term loan which the Borrowers shall repay in full ratably to the Lenders on the Maturity Date; provided that the Term Loan Election may not be exercised unless (i) the Borrower has, on or prior to the Termination Date, paid to the Administrative Agent for the account of each Lender, a fee equal to 1.00% of the principal amount of the Advances outstanding on the Termination Date, each such fee to be allocated to the Lenders in accordance with their respective Pro Rata Shares; and (ii) the conditions listed in Section 3.02(i)(x) and (y) are satisfied on the date of notice of the Term Loan Election and on the date on which the Term Loan Election is to be effected.  All Advances converted into a term loan pursuant to this Section 2.07 shall continue to constitute Advances except that the Borrowers may not reborrow pursuant to Section 2.01 after all or any portion of such Advances have been prepaid pursuant to Section 2.07(b).
 
 
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(b)           Prepayment of Advances.  (i) No Borrower shall have the right to prepay any principal amount of any Advances other than as provided in this Section 2.07.  Any Borrower may, upon notice no later than 11:00 A.M. (New York City time) on the second Business Day before the prepayment of Eurocurrency Rate Advances, and no later than 11:00 A.M. (New York City time) on the day of the prepayment in the case of Base Rate Advances, in either case to the Administrative Agent and stating the proposed date and principal amount of the prepayment, and if such notice is given such Borrower shall, prepay the outstanding principal amount of the Advances comprising part of the same Borrowing in whole or ratably in part, together with accrued interest to the date of such prepayment on the principal amount prepaid; provided, however, that each partial prepayment shall be in the aggregate principal amount of at least $5,000,000 or a larger whole multiple of $1,000,000 (or, in the case of Advances denominated in an Alternate Currency, the Foreign Currency Equivalent thereof in such Alternate Currency, rounded to the nearest 1,000,000 units of such Alternate Currency) and, in the case of a payment or prepayment of a Eurocurrency Rate Advance other than on the last day of the Interest Period for such Advance as provided herein, shall have the consequences set forth in Section 8.04(b).
 
(ii)           The Company shall notify the Administrative Agent immediately upon becoming aware of any Change of Control.  Upon receipt of such notice and for a period of 90 days thereafter, the Required Lenders shall be entitled, by written notice to the Company received within such period, to terminate the Commitments in whole and require the Company and any other Borrower to prepay all outstanding Advances within 5 Business Days of its receipt of such notice, together with any accrued and unpaid interest thereon to the date of such prepayment and any other amounts due hereunder.  Notwithstanding any other provision contained herein, a Change of Control shall not, in and of itself, constitute a Default hereunder.

(c)           Alternate Currency Revaluation.  (i)  If at any time by reason of fluctuations in foreign exchange rates (1) the aggregate outstanding principal amount of all Advances (for which purpose the amount of any Advance that is denominated in an Alternate Currency shall be deemed to be the Dollar Equivalent thereof as of the date of determination) exceeds 105% of the aggregate amount of the Commitments at such time or (2) the aggregate outstanding principal amount of all Advances denominated in Alternate Currencies exceeds 105% of the Foreign Currency Sublimit at such time, the Administrative Agent shall use all reasonable efforts to give prompt written notice thereof to the Company, specifying the amount to be prepaid under this clause (i), and the Company shall, within five Business Days of the date of such notice, prepay the Advances, or cause Advances to be prepaid, in an amount so that after giving effect thereto the aggregate outstanding principal amount of the Advances (determined as aforesaid) does not exceed the aggregate amount of the Commitments; provided that any such payment shall be accompanied by any amounts payable under Section 8.04(b).  The determination of which Advances to prepay hereunder shall be at the sole option of the Company.  The determinations of the Administrative Agent hereunder shall be conclusive and binding on the Borrowers in the absence of manifest error.
 
 
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(ii)           In addition, if on the last day of any Interest Period the aggregate outstanding principal amount of the Advances (for which purpose the amount of any Advance that is denominated in an Alternate Currency shall be deemed to be the Dollar Equivalent thereof as of the date of determination), would exceed 100% of the aggregate amount of the Commitments, the Administrative Agent shall use all reasonable efforts to give prompt written notice thereof to the Company, specifying the amount to be prepaid under this clause (ii), and the Company shall, within five Business Days of the date of such notice, prepay the Advances, or cause Advances to be prepaid, or reduce the requested Advances in such amounts that after giving effect to such action the aggregate outstanding principal amount of the Advances does not exceed the aggregate amount of the Commitments; provided that any such payment shall be accompanied by any amounts payable under Section 8.04(b).  The determination of which Advances to prepay hereunder shall be at the sole option of the Company.  The determinations of the Administrative Agent hereunder shall be conclusive and binding on the Borrowers in the absence of manifest error.
 
SECTION 2.08   Increased Costs .   (a)   Changes in Law, Etc .  If, due to (i) the introduction of or any change in or in the official interpretation of any law or regulation on or after the date of this Agreement, or (ii) the compliance with any guideline or request not applicable on the date of this Agreement from any central bank or other governmental authority (whether or not having the force of law), there shall be any increase in the cost to any Lender of agreeing to make or making, funding or maintaining Eurocurrency Rate Advances, then the Company shall from time to time, promptly upon demand by such Lender (with a copy of such demand to the Administrative Agent) accompanied by the certificate described in the next sentence, pay, or cause to be paid, to the Administrative Agent for the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost.  A certificate as to the amount of such increased cost, submitted to the Company and the Administrative Agent by such Lender, shall be conclusive and binding on the Borrowers for all purposes, absent manifest error.
 

(b)           Capital Adequacy.  If, due to (i) the introduction of or any change in or in the official interpretation of any law or regulation on or after the date of this Agreement, or (ii) the compliance with any guideline or request not applicable on the date of this Agreement from any central bank or other governmental authority (whether or not having the force of law), any Lender determines that the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender has been or would be affected and that the amount of such capital is increased by or based upon the existence of such Lender’s Advances or commitment to lend hereunder and other commitments of this type, then, upon demand by such Lender received by the Company within such time from the relevant change or introduction described above as is reasonably required in order to determine the effect thereof (with a copy of such demand to the Administrative Agent) accompanied by a certificate of such Lender as to the amounts demanded, the Company shall pay, or cause to be paid, to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender or such corporation, as the case may be, to the extent that such Lender reasonably determines such increase in capital to be allocable to the existence of such Lender’s Advances or commitment to lend hereunder, such amounts to be due and payable within two days of such Lender’s invoice therefor.  A certificate as to such amounts submitted to the Company and the Administrative Agent by such Lender shall be conclusive and binding on the Borrowers for all purposes, absent manifest error.
 
 
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SECTION 2.09   Payments and Computations .   (a)   Manner of Payment .  Each Borrower shall make each payment hereunder and under the Notes without deduction, setoff or counterclaim not later than 11:00 A.M. (Local Time) on the day when due to the Administrative Agent at the Administrative Agent’s Account in the Principal Financial Center for the relevant Currency in same day funds.  The Administrative Agent will promptly thereafter cause to be distributed like Currency and funds relating to the payment of principal or interest or facility fees ratably (other than amounts payable pursuant to Section 2.02(d), 2.06, 2.08, 2.10 or 8.04(b)) to the Lenders for the account of their respective Applicable Lending Offices, and like funds relating to the payment of any other amount payable to any Lender to such Lender for the account of its Applicable Lending Office, in each case to be applied in accordance with the terms of this Agreement.  Upon its acceptance of an Assignment and Acceptance and recording of the information contained therein in the Register pursuant to Section 8.07(c), from and after the effective date specified in such Assignment and Acceptance, the Administrative Agent shall make all payments hereunder and under the Notes in respect of the interest assigned thereby to the Lender assignee thereunder, and the parties to such Assignment and Acceptance (which shall not include any Borrower) shall make all appropriate adjustments in such payments for periods prior to such effective date directly between themselves. The making by any Borrower of any payment to the Administrative Agent for the account of any Lender as herein provided shall pro tanto discharge the relevant obligation of such Borrower to such Lender.

(b)           Setoff.  If an Event of Default shall have occurred and be continuing, each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other indebtedness at any time owing by such Lender to any Borrower against any of and all the obligations of such Borrower now or hereafter existing under this Agreement and the Notes held by such Lender, although such obligations may be unmatured.  The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
 
(c)           Interest.  All computations of interest based on (i) the Base Rate and the Eurocurrency Rate for Advances denominated in Pounds Sterling shall be made by the Administrative Agent on the basis of a year of 365 or 366 days, as the case may be, and (ii) the Eurocurrency Rate for Advances denominated in a Currency other than Pounds Sterling or the Federal Funds Rate and all computations of interest pursuant to Section 2.06 shall be made by the Administrative Agent on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable.  Each determination by the Reference Bank of an interest rate for any Advance hereunder shall be conclusive and binding for all purposes, absent manifest error.
 
 
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(d)           Business Days.  Whenever any payment hereunder or under the Notes shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or facility fee, as the case may be; provided that if such extension would cause payment of interest on or principal of Eurocurrency Rate Advances to be made in the next following calendar month, such payment shall be made on the next preceding Business Day.
 
(e)           Assumption of Payment.  Unless the Administrative Agent shall have received notice from a Borrower prior to the date on which any payment is due to the Lenders hereunder that such Borrower will not make such payment in full, the Administrative Agent may assume that such Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such due date an amount equal to the amount then due such Lender.  If and to the extent such Borrower shall not have so made such payment in full to the Administrative Agent, each Lender shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Federal Funds Rate (if such Advance is denominated in Dollars) or at the London interbank offered rate for the relevant Currency (if such Advance is denominated in an Alternate Currency).
 
(f)           Rate Information.  The Reference Bank shall notify the Company and the Administrative Agent of the Base Rate in effect on the first Business Day on which a Base Rate Advance is outstanding and each day on which a change in the Base Rate occurs, each in sufficient detail to enable the Company to calculate interest payments hereunder with respect to Base Rate Advances, and shall provide such information to any Lender promptly upon its request.  The Company will provide to the Administrative Agent (i) promptly upon receipt thereof copies of the information received by the Company pursuant to the immediately preceding sentence or any Rate Notification received pursuant to Section 2.02(a), (ii) promptly upon the making of any interest payment with respect to a Base Rate Advance hereunder a schedule based on such information setting forth the Base Rate for each day in the period in which such Advance was outstanding, and (iii) promptly upon obtaining knowledge thereof, notice of any change in the rating assigned by Standard & Poor’s, Moody’s, or Fitch to the Company’s Long-Term Indebtedness and the date of such change, provided that the Company’s failure to provide any of the foregoing information shall be deemed not to be a Default or Event of Default hereunder.
 
(g)           Currency of Payments.  All payments of principal of and interest on, and any amounts payable under Section 2.06 in respect of, an Advance that is denominated in a particular Currency shall be made in such Currency, and all other amounts payable under this Agreement (except as specified in Section 9.06) shall be paid in Dollars.
 
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SECTION 2.10   Taxes .   (a)   General .  Any and all payments by each Loan Party hereunder or under the Notes shall be made in accordance with Section 2.09, free and clear of and without deduction for any and all taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto (which are, with respect to payments by the Company or the Subsidiary Guarantor only, not in effect or not imposed on the date of this Agreement); excluding , in the case of each Lender and the Administrative Agent, taxes imposed on its income, and franchise taxes imposed on it by the jurisdiction under the laws of which such Lender or the Administrative Agent (as the case may be) is organized or any political subdivision thereof and, in the case of each Lender, taxes imposed on its income, and franchise taxes imposed on it, by the jurisdiction of such Lender’s Applicable Lending Office or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as “ Taxes ”).
 
(b)            Other Taxes .  In addition, each Loan Party agrees to pay any stamp or documentary taxes or any other excise or property taxes, charges or similar levies which arise from any payment made hereunder or under the Notes or from the execution, delivery or registration of, or otherwise with respect to, this Agreement not in effect or not imposed on the date of this Agreement or the Notes (hereinafter referred to as “Other Taxes”) upon notice from the Lender.
 
(c)            Tax Indemnity .  Each Loan Party will indemnify each Lender and the Administrative Agent for the full amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section 2.10) paid by such Lender or the Administrative Agent (as the case may be) and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted.  This indemnification shall be made within 30 days from the date such Lender or the Administrative Agent (as the case may be) makes written demand therefor.
 
(d)            Receipt .  Within 30 days after the date of any payment of Taxes, each Loan Party will furnish to the Administrative Agent, at its address referred to in Section 8.02, the original or a certified copy of a receipt evidencing payment thereof.
 
SECTION 2.11   Promissory Notes .   Any Lender may request that Advances of any Type made by it be evidenced by a promissory note.  In such event, the relevant Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) substantially in the form of Exhibit E (a “ Note ”) in the case of the Advances.  Thereafter, such Advances evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 8.07) be represented by one or more promissory notes in such form payable to the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).
 
SECTION 2.12  Use of Proceeds of Advances .   Each Borrower will use the proceeds of the Advances solely for general corporate purposes, including, without limitation, for the acquisition of Margin Stock.
 
SECTION 2.13   [Reserved].
 
 
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SECTION 2.14   Borrowings by Designated Borrowers .     (a)  The Company may, at any time or from time to time, upon not less than 10 Business Day’s notice to the Administrative Agent, designate one or more Subsidiaries organized in any of the jurisdictions listed on Schedule III as Borrowers hereunder.  Upon any such designation of a Subsidiary and the Administrative Agent’s receipt of each of the following (copies of which will be promptly furnished by the Administrative Agent to the Lenders), which shall be in form and substance reasonably satisfactory to the Administrative Agent, such Subsidiary shall be a Designated Borrower and a Borrower entitled to make Borrowings on and subject to the terms and conditions of this Agreement:
 

(i)            Executed Counterparts .  A designation letter (a “ Designation Letter ”) in duplicate, in substantially the form of Exhibit F, duly completed and executed by the Company and such Designated Borrower and delivered to the Administrative Agent at least ten Business Days before the date on which such Subsidiary is to become a Designated Borrower;
 
(ii)            Opinion of Counsel to the Designated Borrower .  A favorable written opinion (addressed to the Administrative Agent and the Lenders and dated the date of the Designation Letter) of reputable counsel to such Designated Borrower (which may be internal counsel) in the relevant jurisdiction (and such Designated Borrower hereby and by delivery of such Designation Letter instruct such counsel to deliver such opinion to the Lenders and the Administrative Agent), as to the due organization of such Designated Borrower under the laws of its jurisdiction of organization, the due authorization, execution and delivery by such Designated Borrower of such Designation Letter and of the making of Borrowings by it hereunder, the obtaining of all licenses, approvals and consents of, and the making of all filings and registrations with, any applicable Governmental Authority required in connection therewith and the legality, validity and binding effect and enforceability thereof, and such other legal matters relating thereto as the Administrative Agent may reasonably request;
 
(iii)            Corporate Documents .  Such documents and certificates as the Administrative Agent may reasonably request (including without limitation certified copies of the charter and by-laws of such Designated Borrower and of resolutions of its Board of Directors authorizing such Designated Borrower’s acceptance of the Company’s designation as a “Designated Borrower” and its becoming a Borrower under this Agreement, and of all documents evidencing all other necessary corporate or other action required with respect to such Designated Borrower becoming party to this Agreement;
 

(iv)            Process Agent .  Evidence that the Process Agent has agreed to act as agent for service of process in New York, New York on behalf of such Designated Borrower under the Loan Documents.
 
(v)            Expenses .  Evidence that such Designated Borrower or the Company shall have paid any and all expenses reasonably incurred by the Administrative Agent (including the reasonable fees and expenses of counsel to the Administrative Agent) in connection with its designation as a Designated Borrower; and
 
 
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(vi)            Other Items .  Such other documents relating thereto as the Administrative Agent or any Lender or special New York counsel to the Administrative Agent may reasonably request, including any documentation and other evidence which may be requested by the Administrative Agent or any Lender to comply with and/or administer any “know your customer” or other customer identification related policies and procedures required under applicable laws and regulations.
 
           (b)           So long as all principal of and interest on all Advances made to any Designated Borrower and all other amounts payable by such Designated Borrower under this Agreement and the other Loan Documents have been paid in full, the Company may terminate the status of such Designated Borrower as a Borrower hereunder by furnishing to the Administrative Agent a letter (a “Termination Letter”) in substantially the form of Exhibit G, duly completed and executed by the Company.  Any Termination Letter furnished hereunder shall be effective upon receipt thereof by the Administrative Agent, which shall promptly so notify the Lenders.  Notwithstanding the foregoing, the delivery of a Termination Letter with respect to any Designated Borrower shall not terminate (i) any obligation of such Borrower that remains unpaid at the time of such delivery (including without limitation any obligation arising thereafter in respect of such Borrower under Section 2.08 or Section 2.10) or (ii) the obligations of the Company under Article IX with respect to any unpaid obligations of such Borrower.
 
SECTION 2.15   European Monetary Union .   (a)   Definitions .  In this Section 2.15 and in each other provision of this Agreement to which reference is made in this Section 2.15 (whether expressly or impliedly), the following terms have the meanings given to them in this Section 2.15:
 
“ EMU ” shall mean economic and monetary union as contemplated in the Treaty on European Union.
 
“ EMU Legislation ” shall mean legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency, being in part the implementation of the third stage of EMU.
 
“ Euro ” shall mean the single currency of Participating Member States of the European Union.
 
“ Participating Member State ” shall mean each state so described in any EMU Legislation.
 
“ Target Operating Day ” shall mean any day that is not (i) a Saturday or Sunday, (ii) Christmas Day or New Year’s Day or (iii) any other day on which the Trans-European Real-time Gross Settlement Express Transfer system (or any successor settlement system) is not operating (as determined by the Administrative Agent).
 
“ Treaty on European Union ” shall mean the Treaty of Rome of March 25, 1957, as amended by the Single European Act 1986 and the Maastricht Treaty (which was signed at Maastricht on February 7, 1992, and came into force on November 1, 1993), as amended from time to time.
 
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(b)           Payments by the Administrative Agent Generally.  With respect to the payment of any amount denominated in the Euro, the Administrative Agent shall not be liable to the Company or any of the Lenders in any way whatsoever for any delay, or the consequences of any delay, in the crediting to any account of any amount required by this Agreement to be paid by the Administrative Agent if the Administrative Agent shall have taken all relevant steps to achieve, on the date required by this Agreement, the payment of such amount in immediately available, freely transferable, cleared funds to the account of the Company or any Lender, as the case may be, in the Principal Financial Center in the Participating Member State which the Company or, as the case may be, such Lender shall have specified for such purpose.  In this paragraph (b), “all relevant steps” shall mean all such steps as may be prescribed from time to time by the regulations or operating procedures of such clearing or settlement system as the Administrative Agent may from time to time reasonably determine for the purpose of clearing or settling payments of the Euro.
 
(c)           Determination of Eurocurrency Rate.  For the purposes of determining the date on which the applicable rate for Eurocurrency Rate Advances is determined under this Agreement for any Advance denominated in the Euro for any Interest Period therefor, references in this Agreement to London Banking Days shall be deemed to be references to Target Operating Days.
 
ARTICLE III
 
CONDITIONS TO EFFECTIVENESS AND LENDING
 

SECTION 3.01   Condition Precedent to Effectiveness .   This Agreement shall become effective as of the time of the delivery of all evidence referenced in clause (g) below on the date (the “ Effective Date ”), which shall be on or before June 30, 2010, as of which the Administrative Agent shall confirm to the Company that it has received the following, each dated such day, in form and substance satisfactory to the Administrative Agent and (except for any Notes) in sufficient copies for each Lender:

(a)           Executed Counterparts.  From each party hereto either (i) a counterpart of this Agreement signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page to this Agreement) that such party has signed a counterpart of this Agreement;
 
(b)           Authority and Approvals.  Certified copies of the resolutions of the Board of Directors of each of the Guarantors (or equivalent documents) authorizing and approving this Agreement, the other Loan Documents to which it is a party and the transactions contemplated hereby and thereby and certified copies of all documents evidencing all necessary corporate action and all other necessary action (corporate, partnership or otherwise) and governmental approvals, if any, with respect to this Agreement and the other Loan Documents to which it is a party;
 
(c)           Secretary’s or Assistant Secretary’s Certificate.  A certificate of the Secretary or an Assistant Secretary of each of the Guarantors, dated the Effective Date, certifying the names and true signatures of the officers of such Guarantor authorized to execute and deliver this Agreement, the Notes, and the other documents to which it is a party and to be delivered hereunder;
 
 
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(d)           Legal Opinions.  An opinion of counsel to the Company and of the Subsidiary Guarantor, respectively, dated the Effective Date, substantially in the form of Exhibit C-1 and Exhibit C-2 hereto and an opinion of special New York counsel to the Administrative Agent, dated the Effective Date, substantially in the form of Exhibit C-3 hereto;
 
(e)           Closing Certificate.  A certificate of a senior financial officer of the Company, dated the Effective Date, certifying that the representations and warranties set forth in Article IV are true on such date as if made on and as of such date and that no Default has occurred and is continuing on such date; and
 
(f)           Fees and Expenses.  Evidence satisfactory to the Administrative Agent that the Company shall have paid to the Administrative Agent for account of the Lenders such up-front fees in connection with the execution of this Agreement as the Company and the Administrative Agent shall have agreed upon.
 
(g)           Acquisition of The Black & Decker Corporation.  Evidence satisfactory to the Administrative Agent that Blue Jay Acquisition Corp. shall have consummated the merger with The Black & Decker Corporation that is contemplated by that certain Agreement and Plan of Merger dated as of November 2, 2009 by and among the Company, Blue Jay Acquisition Corp., and The Black & Decker Corporation , together with evidence that the commitments under the Five-Year Credit Agreement dated as of December 7, 2007 among The Black & Decker Corporation, Black & Decker Luxembourg Finance S.C.A. and Black & Decker Luxembourg S.aR.L., as borrowers, certain lenders parties thereto and Citibank, N.A., as administrative agent for said lenders (the “B&D Facility”) have been or concurrently with the Effective Date are being terminated and all amounts payable under the B&D Facility have been paid.
 
SECTION 3.02   Conditions Precedent to Each Advance .   The obligation of each Lender to make each Advance (including the initial Advance) as part of a Borrowing shall be subject to the further conditions precedent that (i) on the date of such Borrowing the following statements shall be true (and each of the giving of the applicable Notice of Borrowing and the acceptance by the relevant Borrower of the proceeds of such Advance shall constitute a representation and warranty by such Borrower that on the date of such Advance the following statements shall be true):  (x) the representations and warranties contained in Section 4.01 (other than the Excluded Representation) and, to the extent applicable, in the Designation Letter of such Borrower are correct in all material respects on and as of the date of such Borrowing, before and after giving effect to such Borrowing and to the application of the proceeds therefrom, as though made on and as of such date (it being understood and agreed that any representation or warranty which expressly refers by its terms to a specified date shall be required to be true and correct in all material respects only as of such date), and (y) no event has occurred and is continuing, or would result from such Borrowing or from the application of the proceeds therefrom, that would constitute an Event of Default, or would constitute an Event of Default but for the requirement that notice be given or time elapse or both; and (ii) in the case of a requested Borrowing the proceeds of which are to be used to buy or carry any Margin Stock, the Company shall deliver to the Administrative Agent a certificate of a senior financial officer of the Company accompanying the relevant Notice of Borrowing setting forth in reasonable detail the basis upon which the Company has made the representation set forth in the third sentence of Section 4.01(l) on and as of the date of such Borrowing, before and after giving effect to such Borrowing and to the application of the proceeds therefrom, together with (if so requested by the Administrative Agent) a duly completed Form U-1 or Form G-3 satisfactory to the Administrative Agent.
 
 
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ARTICLE IV
 
REPRESENTATIONS AND WARRANTIES

SECTION 4.01   Representations and Warranties of the Company .   The Company represents and warrants as follows:
 
(a)            Corporate Existence .  The Company is a corporation duly organized and validly existing under the laws of the State of Connecticut. The Subsidiary Guarantor is a corporation duly organized and validly existing under the laws of the State of Maryland.
 
(b)            Corporate Authorization, Etc .  The execution, delivery and performance by each Guarantor of this Agreement and the Notes to which it is a party are within such Guarantor’s corporate powers, have been duly authorized by all necessary corporate action and do not contravene (i) the charter or bylaws of such Guarantor or (ii) any law or contractual restriction binding on or affecting the Company or any of its Subsidiaries.
 
(c)            No Approvals .  No authorization, approval or action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by either Guarantor of this Agreement or the Notes to which it is a party.
 
(d)            Enforceability .  This Agreement is and, upon issuance and delivery thereof in accordance with this Agreement, each Note to which it is to be a party will be the legal, valid and binding obligations of each Guarantor, enforceable against such Guarantor in accordance with their respective terms.
 
(e)            Financial Information .  The consolidated balance sheet of the Company and its Consolidated Subsidiaries as of January 2, 2010, and the related statements of income and retained earnings of the Company and its Consolidated Subsidiaries for the fiscal year then ended, copies of which have been furnished to the Lenders, fairly present in all material respects the financial condition of the Company and its Consolidated Subsidiaries as of such date and the results of the operations of the Company and its Consolidated Subsidiaries for the period ended on such date, all in accordance with GAAP consistently applied.
 
(f)            No Litigation .  Except as disclosed or otherwise reflected in (x) the Company’s Annual Report on Form 10-K for the year ended January 2, 2010 or (y) the Subsidiary Guarantor ‘s Annual Report on Form 10-K for the year ended December 31, 2009, there is no pending or (to the best of the Company’s knowledge) threatened action or proceeding against the Company or any of its Subsidiaries or relating to any of their respective properties before any court, governmental agency or arbitrator, which could reasonably be expected to have a Material Adverse Effect or which purports to affect the legality, validity or enforceability of this Agreement or any Note.
 
(g)            No Material Adverse Effect .  Since January 2, 2010, there has been no event, act or condition which has had a Material Adverse Effect.
 
(h)            Environmental Matters .  Except as disclosed or otherwise reflected in (x) the Company’s Annual Report on Form 10-K for the year ended January 2, 2010 or (y) the Subsidiary Guarantor ’ s Annual Report on Form 10-K for the year ended December 31, 2009, neither the Company nor any of its Subsidiaries has received notice or otherwise obtained knowledge of any claim, demand, action, event, condition, report or investigation indicating or concerning any potential or actual liability which could reasonably be expected to, individually or in the aggregate, have a Material Adverse Effect arising in connection with (i) any non-compliance with or violation of the requirements of any applicable federal, state or local environmental health or safety statutes or regulations, or (ii) the release or threatened release of any toxic or hazardous waste, substance or constituent into the environment.
 
(i)            Investment Company .  Neither Guarantor is an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
 
(j)            Disclosure .  The information furnished in writing by or on behalf of any Loan Party to the Lenders in connection with the negotiation, execution and delivery of this Agreement or any other Loan Document does not contain any material misstatements of fact or omit to state a material fact necessary to make the statements contained therein, in light of the circumstances under which they were made, not misleading.
 
(k)            No Defaults .  Neither Guarantor (i) is in default under or with respect to this Agreement or any Note to which it is a party, and (ii) is in default under or with respect to any other agreement, instrument or undertaking to which it is a party or by which it or any of its property is bound in any respect which could reasonably be expected to result in a Material Adverse Effect.
 
(l)            Use of Proceeds, Etc .  All proceeds of each Advance will be used by each Borrower only in accordance with the provisions of Section 2.12.  No Borrower is or will be engaged in the business of extending credit for the purpose of buying or carrying Margin Stock and no proceeds of any Advance will be used to extend credit to others for the purpose of buying or carrying any Margin Stock.  Neither the making of any Advance nor the use of the proceeds thereof will violate or be inconsistent with the provisions of Regulations U or X issued by the Board of Governors of the Federal Reserve System.
 

ARTICLE V
 
COVENANTS OF THE COMPANY
 

SECTION 5.01   Affirmative Covenants .   So long as any Advance or any other amount owing hereunder shall remain unpaid or any Lender shall have any Commitment hereunder:
 
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(a)           Financial Information.  The Company will furnish to the Lenders:
 
(i)            Quarterly Financial Statements .  Within 50 days after the close of each quarterly accounting period in each fiscal year of the Company, the consolidated balance sheet of the Company and its Consolidated Subsidiaries as at the end of such quarterly period and the related consolidated and consolidating statements of income, retained earnings and cash flows for such quarterly period and for the elapsed portion of the fiscal year ended with the last day of such quarterly period, in each case setting forth comparative figures for the related periods in the prior fiscal year.
 
(ii)            Annual Financial Statements .  Within 95 days after the close of each fiscal year of the Company, the consolidated balance sheet of the Company and its Consolidated Subsidiaries as at the end of such fiscal year and the related consolidated statement of income, retained earnings and cash flows for such fiscal year, setting forth comparative figures for the preceding fiscal year and reported on without qualification by independent certified public accountants of recognized national standing, in each case together with a report of such accounting firm stating that in the course of its regular audit of the consolidated financial statements of the Company, which audit was conducted in accordance with generally accepted auditing standards, such accounting firm has obtained no knowledge of any Default or Event of Default relating to accounting matters (including, without limitation, in respect of Section 5.01(f)), or if in the opinion of such accounting firm such a Default or Event of Default has occurred and is continuing, a statement as to the nature thereof.
 
(iii)            Officer’s Certificates .  At the time of the delivery of the financial statements under clauses (i) and (ii) above, a certificate of a senior financial officer of the Company which certifies (x) that such financial statements fairly present the financial condition and the results of operations of the Company and its Consolidated Subsidiaries on the dates and for the periods indicated, and (y) that such officer has reviewed the terms of this Agreement and has made, or caused to be made under his or her supervision, a review in reasonable detail of the business and condition of the Company and its Consolidated Subsidiaries during the accounting period covered by such financial statements, and that as a result of such review such officer has concluded that no Default or Event of Default has occurred during the period commencing at the beginning of the accounting period covered by the financial statements accompanied by such certificate and ending on the date of such certificate or, if any Default or Event of Default has occurred, specifying the nature and extent thereof and, if continuing, the action the Company proposes to take in respect thereof.  Such certificate shall set forth the calculations required to establish whether the Company was in compliance with the provisions of Section 5.01(f) for the twelve-month period ending as at the end of the accounting period covered by the financial statements accompanied by such certificate.
 
(iv)            Notice of Default or Litigation .  Promptly after any Loan Party obtains knowledge thereof, notice of (i) the occurrence of any Default or Event of Default, or (ii) any litigation or governmental proceeding pending or threatened against any Loan Party or other event, act or condition which could reasonably be expected to result in a Material Adverse Effect.
 
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(v)            SEC Filings .  Promptly upon transmission thereof, copies of all regular and periodic financial information, proxy materials and other information and reports, if any, which the Company shall file with the Securities and Exchange Commission or any governmental agencies substituted therefor or which the Company shall send to its stockholders.
 
(vi)            Other Information .  From time to time, and as soon as reasonably practicable, such other information or documents (financial or otherwise) as any Lender through the Administrative Agent may from time to time reasonably request.
 

Reports and financial statements required to be delivered by the Company pursuant clauses (i), (ii) and (v) of this Section 5.01 (a) shall be deemed to have been delivered on the date on which it posts such reports, or reports containing such financial statements, on its website on the Internet at www.stanleyworks.com , or when such reports, or reports containing such financial statements are posted on the website of the Securities and Exchange Commission at www.sec.gov ; provided that it shall deliver such paper copies of the reports and financial statements referred to in Clauses (i), (ii) and (v) of this Section 5.01(a) to the Administrative Agent or any Lender who request it to deliver such paper copies until written notice to cease delivering  paper copies is given by the Administrative Agent  or such Lender.

(b)           Compliance with Law.  The Company shall, and shall cause each of its Subsidiaries to, comply with all applicable laws, rules, statutes, regulations, decrees and orders of all governmental bodies, domestic or foreign, in respect of the conduct of their business and the ownership of their property, except such non-compliance as could not reasonably be expected to result in a Material Adverse Effect at the time of such noncompliance or in the foreseeable future.
 
(c)           Payment of Taxes.  The Company shall pay or cause to be paid, and shall cause each of its Subsidiaries to pay or cause to be paid, when due, all taxes, charges and assessments and all other lawful claims required to be paid by the Company or such Subsidiaries, except (x) as contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves have been established with respect thereto in accordance with GAAP and (y) where such nonpayment could not reasonably be expected to result in a Material Adverse Effect.
 
(d)           Preservation of Corporate Existence.  Except as otherwise permitted by this Agreement, the Company shall, and shall cause each of its Subsidiaries to, do all things necessary to preserve, renew and keep in full force and effect its corporate existence and the licenses, permits, rights and franchises necessary to the proper conduct of its business, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.  Neither the Company nor any of its Subsidiaries will engage in any business if, as a result, the general nature of the business, taken on a consolidated basis, which would then be engaged in by the Company and its Subsidiaries would be substantially changed from the general nature of the business engaged in by the Company and its Subsidiaries on the date of this Agreement.
 
(e)           Maintenance of Books and Records.  The Company will maintain financial records in accordance with GAAP, consistently applied.  The representatives of the Administrative Agent or any of the Lenders shall have the right to visit and inspect any of the properties of the Company and of any of its Subsidiaries, to examine their books of account and records and take notes and make transcripts therefrom, and to discuss their affairs, finances and accounts with, and be advised as to the same by, their officers upon reasonable prior notice at  such reasonable times and intervals as may be requested (subject to the standard policies of the Company and its Subsidiaries as to access, safety and, without prejudice to the reasonable requirements of lending institutions and their regulatory supervisors, confidentiality).
 
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(f)           Interest Coverage Ratio.  The Company shall maintain, for each period of four consecutive fiscal quarters of the Company, an Interest Coverage Ratio of not less than 3.50 to 1.00.
 
                       SECTION 5.02   Negative Covenants .   So long as any Advance or any other amount owing hereunder shall remain unpaid or any Lender shall have any Commitment hereunder:
 
(a)           No Liens.  The Company shall not, and shall not permit any of its Subsidiaries to, create, incur, assume or suffer to exist, directly or indirectly, any Lien on any Principal Property now owned or hereafter acquired (unless the Company secures the Advances made hereunder equally and ratably with such Lien), other than:
 
(i)           Liens existing and disclosed to the Lenders in writing prior to the date hereof;
 
(ii)           Liens for taxes not yet due or which are being contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves are being maintained in accordance with GAAP;
 
(iii)           statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and other Liens imposed by law created in the ordinary course of business for amounts not yet due or which are being contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate bonds have been posted;
 
(iv)           Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money);
 
(v)           easements, rights-of-way, zoning and similar restrictions and other similar charges or encumbrances not interfering with the ordinary conduct of the business of the Company or any of its Subsidiaries and which do not detract materially from the value of the property to which they attach or impair materially the use thereof by the Company or any of its Subsidiaries;
 
(vi)           Liens on property of any Person existing at the time such Person becomes a Subsidiary of the Company and not created in contemplation thereof;
 
 
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(vii)           Liens securing Indebtedness owed by a Subsidiary of the Company to the Company or another Subsidiary of the Company;
 
(viii)           any Lien arising solely by operation of law in the ordinary course of business or which is contained in a contract for the purchase or sale of goods or services entered into in the ordinary course of business;
 
(ix)           Liens on any property existing at the time of acquisition but only if the amount of outstanding Indebtedness secured thereby does not exceed the lesser of the fair market value or the purchase price of the property as purchased;
 
(x)           any Lien securing the purchase price of revenues or assets purchased after the date hereof or the cost of repairing or altering, constructing, developing or substantially improving all or any part of such revenues or assets; provided that such Lien attaches only to such revenues or assets (including any improvements) and the Indebtedness thereby secured does not exceed the lesser of the fair market value or the purchase price of the revenues or assets (including any improvements) as purchased;
 
(xi)           any other Liens on Principal Properties securing Indebtedness which in the aggregate, together with Attributable Debt, does not exceed 10% of Consolidated Net Worth at any time outstanding; and
 
(xii)           any extension, renewal or replacement of any of the Liens referred to above; provided that the Indebtedness secured by any such extension, renewal or replacement does not exceed the sum of the principal amount of the Indebtedness originally secured thereby and any fee incurred in connection with such transaction.
 
(b)           Merger, Etc.  The Company shall not (i) enter into any merger or consolidation, or liquidate, wind up or dissolve (or suffer any liquidation, wind-up or dissolution), discontinue its business or convey, lease, sell, transfer or otherwise dispose of, in one transaction or series of transactions, all or substantially all of its business or property, whether now or hereafter acquired, or (ii) permit any of its Subsidiaries to do so, if such action could reasonably be expected to have a Material Adverse Effect, except that (1) any wholly-owned Subsidiary of the Company may merge into or convey, sell, lease or transfer all or substantially all of its assets to, the Company or any other wholly-owned Subsidiary of the Company and (2) the Company or any of its Subsidiaries may enter into any merger or consolidation so long as in the case of a transaction involving the Company, the Company, or in the case of any other transaction, a Subsidiary of the Company, is the surviving entity in such transaction and, after giving effect thereto, no Default or Event of Default shall have occurred or be continuing.
 
(c)           Sale-Leasebacks.  The Company shall not, and shall not permit any of its Subsidiaries to, become liable, directly or indirectly, with respect to any lease, whether an operating lease or a Capital Lease, of any property (whether real or personal or mixed) whether now owned or hereafter acquired, (i) which the Company or such Subsidiary has sold or transferred or is to sell or transfer to any other Person, or (ii) which the Company or such Subsidiary intends to use for substantially the same purposes as any other property which has been or is to be sold or transferred by the Company or such Subsidiary to any other Person in connection with such lease.  Notwithstanding the foregoing, the Company and its Subsidiaries shall be permitted to become liable with respect to the leases described above so long as all Attributable Debt, together with the Liens described in Section 5.02(a)(xi), does not exceed 10% of Consolidated Net Worth at any time outstanding.
 
 
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ARTICLE VI
 
EVENTS OF DEFAULT

SECTION 6.01   Events of Default .   If any of the following events (“Events of Default”) shall occur and be continuing:

(a)           Any Borrower shall fail to pay when due (or, if any such failure is due solely to technical or administrative difficulties relating to the transfer of such amounts, within two Business Days after its due date) any principal of any Advance; or any Borrower shall fail to pay when due any interest on any Advance, any fee (other than the fees referenced in Section 2.03) or any other amount payable by it hereunder or under any Note and five (5) days shall have elapsed from the date such interest, fees or other amounts were due; or with respect to the fees payable pursuant to Section 2.03, any Borrower shall fail to pay any such fee when due and two Business Days shall have elapsed from the Company’s receipt of notice of such nonpayment from the Administrative Agent or any Lender; or
 
(b)           Any representation or warranty made by any Loan Party herein or pursuant to this Agreement or any other Loan Document (including without limitation in any certificate of such Loan Party delivered pursuant hereto) shall prove to have been incorrect in any material respect when made or deemed made; or
 
(c)           The Company or any other Loan Party, as applicable, shall fail to perform any term, covenant or agreement contained in the first sentence of Section 2.07(b), Section 5.01(a)(iv), 5.01(f) or 5.02 on its part to be performed or observed; or
 
(d)           Any Loan Party shall fail to perform any term, covenant or agreement contained in this Agreement (except those described in clauses (a) and (c) above) and such failure shall continue for 30 days;   or
 
(e)           A court having jurisdiction in the premises shall enter a decree or order for relief in respect of any Loan Party or any Principal Subsidiary in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar official of such Loan Party or such Principal Subsidiary or for any substantial part of its property, or ordering the winding up or liquidation of its affairs and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or
 
(f)           Any Loan Party or any Principal Subsidiary shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or shall consent to the entry of any order for relief in an involuntary case under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, sequestrator or other similar official of such Loan Party or such Principal Subsidiary or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or shall take any corporate action in furtherance of any of the foregoing; or
 
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(g)           (A) Any Loan Party or any Principal Subsidiary shall fail to make any payment in respect of Indebtedness when due (whether by scheduled maturity, required prepayment, acceleration or otherwise) if the aggregate amount of such payment is $75,000,000 or more, or (B) any breach, default or event of default shall occur and be continuing (and applicable grace and notice periods shall have expired) under any agreement or indenture relating to any Indebtedness of such Loan Party or such Principal Subsidiary in an aggregate amount of $75,000,000 or more, and, except in the case of financial covenant defaults, the maturity of any such Indebtedness has been accelerated in accordance with the terms thereof; or
 
(h)           (A) Any Termination Event shall occur, or (B) any Plan shall have an unfunded liability, which means the excess, if any, of a Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Plan’s assets, determined in accordance with the assumptions used for funding that Plan pursuant to Section 412 of the Internal Revenue Code for the applicable plan year, or (C) the Company or any member of its ERISA Controlled Group shall fail to pay when due an amount which it shall have become liable to pay to the PBGC, any Plan or a trust established under Title IV of ERISA, or (D) a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that an ERISA Plan must be terminated or have a trustee appointed to administer any ERISA Plan, or (E) the Company or a member of its ERISA Controlled Group suffers a partial or complete withdrawal from a Multiemployer Plan or is in “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan, or (F) a proceeding shall be instituted against the Company or any member of its ERISA Controlled Group to enforce Section 515 of ERISA, or (G) any other event or condition shall occur or exist with respect to any Plan, if such events, transactions or conditions set forth in clauses (A) through (G) above could singly or in the aggregate be reasonably expected to have a Material Adverse Effect; or
 
(i)           If there shall remain in force, undischarged, unsatisfied and unstayed, for more than 30 days, whether or not consecutive, any final judgment against the any Loan Party or any Principal Subsidiary which, when added to any other outstanding final judgments which remain undischarged, unsatisfied and unstayed for more than 30 days against such Loan Party or any such Principal Subsidiary, exceeds $75,000,000;
 

then, and in any such event, the Administrative Agent (i) shall at the request, or may with the consent, of the Required Lenders, by notice to the Company, declare the obligation of each Lender to make Advances to be terminated, whereupon the same shall forthwith terminate, and (ii) shall at the request, or may with the consent, of the Required Lenders, by notice to the Company, declare all Advances, the Notes, all interest thereon and all other amounts payable under this Agreement to be forthwith due and payable, whereupon all Advances, the Notes, all such interest and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by each Borrower; provided , however , that in the case of any of the Events of Default specified in clauses (e) or (f) above with respect to any Borrower, (A) the obligation of each Lender to make Advances shall automatically be terminated and (B) the Advances, the Notes, all such interest and all such amounts shall automatically become and be due and payable, without presentment, demand, protest or any notice of any kind, all of which are hereby expressly waived by each Borrower.
 
 
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ARTICLE VII
 
THE ADMINISTRATIVE AGENT

SECTION 7.01   Appointment and Authority .   Each Lender hereby irrevocably appoints Citibank to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article (other than the provisions of Section 7.07) are solely for the benefit of the Administrative Agent and the Lenders, and neither the Company nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions.
 
SECTION 7.02   Administrative Agent Individually .   (a)  The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity.  Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Company or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.
 
(b)           Each Lender understands that the Person serving as Administrative Agent, acting in its individual capacity, and its Affiliates (collectively, the “Agent’s Group”) are engaged in a wide range of financial services and businesses (including investment management, financing, securities trading, corporate and investment banking and research) (such services and businesses are collectively referred to in this Section 7.02 as “Activities”) and may engage in the Activities with or on behalf of one or more of the Loan Parties or their respective Affiliates.  Furthermore, the Agent’s Group may, in undertaking the Activities, engage in trading in financial products or undertake other investment businesses for its own account or on behalf of others (including the Loan Parties and their Affiliates and including holding, for its own account or on behalf of others, equity, debt and similar positions in the Company, another Loan Party or their respective Affiliates), including trading in or holding long, short or derivative positions in securities, loans or other financial products of one or more of the Loan Parties or their Affiliates.  Each Lender understands and agrees that in engaging in the Activities, the Agent’s Group may receive or otherwise obtain information concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) which information may not be available to any of the Lenders that are not members of the Agent’s Group.  None of the Administrative Agent or any member of the Agent’s Group shall have any duty to disclose to any Lender or use on behalf of the Lenders, and shall not be liable for the failure to so disclose or use, any information whatsoever about or derived from the Activities or otherwise (including any information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Loan Party or any Affiliate of any Loan Party) or to account for any revenue or profits obtained in connection with the Activities, except that the Administrative Agent shall deliver or otherwise make available to each Lender such documents as are expressly required by any Loan Document to be transmitted by the Administrative Agent to the Lenders.
 
(c)           Each Lender further understands that there may be situations where members of the Agent’s Group or their respective customers (including the Loan Parties and their Affiliates) either now have or may in the future have interests or take actions that may conflict with the interests of any one or more of the Lenders (including the interests of the Lenders hereunder and under the other Loan Documents).  Each Lender agrees that no member of the Agent’s Group is or shall be required to restrict its activities as a result of the Person serving as Administrative Agent being a member of the Agent’s Group, and that each member of the Agent’s Group may undertake any Activities without further consultation with or notification to any Lender.  None of (i) this Agreement or any other Loan Document, (ii) the receipt by the Agent’s Group of information (including Information) concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) or (iii) any other matter shall give rise to any fiduciary, equitable or contractual duties (including without limitation any duty of trust or confidence) owing by the Administrative Agent or any member of the Agent’s Group to any Lender including any such duty that would prevent or restrict the Agent’s Group from acting on behalf of customers (including the Loan Parties or their Affiliates) or for its own account.
 
SECTION 7.03   Duties of Administrative Agent; Exculpatory Provisions .   (a)  The Administrative Agent’s duties hereunder and under the other Loan Documents are solely ministerial and administrative in nature and the Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents.  Without limiting the generality of the foregoing, the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, but shall be required to act or refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the written direction of the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent or any of its Affiliates to liability or that is contrary to any Loan Document or applicable law.
 
(b)           The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 8.01 or 8.03) or (ii) in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default or the event or events that give or may give rise to any Default or Event of Default unless and until the Company or any Lender shall have given notice to the Administrative Agent describing such Default or Event of Default and such event or events.
 
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(c)           Neither the Administrative Agent nor any member of the Agent’s Group shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty, representation or other information made or supplied in or in connection with this Agreement, any other Loan Document or the Information Memorandum, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith or the adequacy, accuracy and/or completeness of the information contained therein, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other Loan Document or (v) the satisfaction of any condition set forth in Article 3 or elsewhere herein, other than (but subject to the foregoing clause (ii)) to confirm receipt of items expressly required to be delivered to the Administrative Agent.
 
(d)           Nothing in this Agreement or any other Loan Document shall require the Administrative Agent or any of its Related Parties to carry out any “know your customer” or other checks in relation to any Person on behalf of any Lender and each Lender confirms to the Administrative Agent that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Administrative Agent or any of its Related Parties.
 
SECTION 7.04   Reliance by Administrative Agent .   The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Borrowing that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless an officer of the Administrative Agent responsible for the transactions contemplated hereby shall have received notice to the contrary from such Lender prior to the making of such Loan, and such Lender shall not have made available to the Administrative Agent such Lender’s ratable portion of such Borrowing.  The Administrative Agent may consult with legal counsel (who may be counsel for the Company or any other Loan Party), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
 
SECTION 7.05   Indemnification .   The Lenders agree to indemnify the Administrative Agent (to the extent not reimbursed by the Company), ratably according to the respective principal amounts of their Commitments, as then or most recently in effect, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against the Administrative Agent in any way relating to or arising out of this Agreement and the Notes, or any action taken or omitted by the Administrative Agent under this Agreement and the Notes, provided that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from the Administrative Agent’s gross negligence or willful misconduct.  Without limitation of the foregoing, each Lender agrees to reimburse the Administrative Agent promptly upon demand for its ratable share of any out-of-pocket expenses (including counsel fees) incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, to the extent that the Administrative Agent is not reimbursed for such expenses by the Company.
 
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SECTION 7.06   Delegation of Duties.   The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.  Each such sub-agent and the Related Parties of the Administrative Agent and each such sub-agent shall be entitled to the benefits of all provisions of this Article 7 and Section 8.04   (as though such sub-agents were the “Administrative Agent” under the Loan Documents) as if set forth in full herein with respect thereto.
 
SECTION 7.07   Resignation of Administrative Agent .   The Administrative Agent may at any time give notice of its resignation to the Lenders and the Company.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Company, to appoint a successor, which shall be a bank with an office in New York, or an Affiliate of any such bank with an office in New York, and which successor shall be reasonably acceptable to the Company.  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (such 30-day period, the “ Lender Appointment Period ”), then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent meeting the qualifications set forth above.  In addition and without any obligation on the part of the retiring Administrative Agent to appoint, on behalf of the Lenders, a successor Administrative Agent, the retiring Administrative Agent may at any time upon or after the end of the Lender Appointment Period notify the Company and the Lenders that no qualifying Person has accepted appointment as successor Administrative Agent and the effective date of such retiring Administrative Agent’s resignation.  Upon the resignation effective date established in such notice and regardless of whether a successor Administrative Agent has been appointed and accepted such appointment, the retiring Administrative Agent’s resignation shall nonetheless become effective and (i) the retiring Administrative Agent shall be discharged from its duties and obligations as Administrative Agent hereunder and under the other Loan Documents and (ii) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this paragraph.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties as Administrative Agent of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations as Administrative Agent hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this paragraph).  The fees payable by the Company to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Company and such successor.  After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 8.04   shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.
 
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SECTION 7.08   Non-Reliance on Administrative Agent and Other Parties .   (a)  Each Lender confirms to the Administrative Agent, each other Lender and each of their respective Related Parties that it (i) possesses (individually or through its Related Parties) such knowledge and experience in financial and business matters that it is capable, without reliance on the Administrative Agent, any other Lender or any of their respective Related Parties, of evaluating the merits and risks (including tax, legal, regulatory, credit, accounting and other financial matters) of (x) entering into this Agreement, (y) making Loans and other extensions of credit hereunder and under the other Loan Documents and (z) taking or not taking actions hereunder and thereunder, (ii) is financially able to bear such risks and (iii) has determined that entering into this Agreement and making Loans and other extensions of credit hereunder and under the other Loan Documents is suitable and appropriate for it.
 
(b)           Each Lender acknowledges that (i) it is solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with this Agreement and the other Loan Documents, (ii) it has, independently and without reliance upon the Administrative Agent, any other Lender or any of their respective Related Parties, made its own appraisal and investigation of all risks associated with, and its own credit analysis and decision to enter into, this Agreement based on such documents and information, as it has deemed appropriate and (iii) it will, independently and without reliance upon the Administrative Agent, any other Lender or any of their respective Related Parties, continue to be solely responsible for making its own appraisal and investigation of all risks arising under or in connection with, and its own credit analysis and decision to take or not take action under, this Agreement and the other Loan Documents based on such documents and information as it shall from time to time deem appropriate, which may include, in each case:
 
(i)           the financial condition, status and capitalization of the Company and each other Loan Party;
 
(ii)           the legality, validity, effectiveness, adequacy or enforceability of this Agreement and each other Loan Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Loan Document;
 
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(iii)           determining compliance or non-compliance with any condition hereunder to the making of a Loan and the form and substance of all evidence delivered in connection with establishing the satisfaction of each such condition; and
 
(iv)           the adequacy, accuracy and/or completeness of the Information Memorandum and any other information delivered by the Administrative Agent, any other Lender or by any of their respective Related Parties under or in connection with this Agreement or any other Loan Document, the transactions contemplated hereby and thereby or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Loan Document.
 
SECTION 7.09   No Other Duties, Etc.   Anything herein to the contrary notwithstanding, none of the Persons acting as Bookrunners, Lead Arrangers or Syndication Agent listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent or as a Lender hereunder.
 

ARTICLE VIII
 
MISCELLANEOUS

SECTION 8.01   Amendments, Etc.  No amendment or waiver of any provision of this Agreement or any other Loan Document, nor consent to any departure by any Loan Party therefrom, shall in any event be effective unless the same shall be in writing and signed by the Company and the relevant other Loan Party, if applicable, and the Required Lenders, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that the written consent of the Company and all the Lenders shall be required in order to amend or waive any provision of the Agreement or the Notes which would have the effect of (a) a reduction in principal, interest or fees payable to the Lenders under this Agreement or the Notes, (b) the postponement of any date fixed for the payment of any principal, interest or fees under this Agreement or the Notes, (c) an increase in the Commitments, (d) amending or waiving compliance with the last sentence of Section 2.01(a), Section 2.08, Section 8.05 or this Section 8.01, (e) amending the definition of Required Lenders or (f) any release or modification of any Guarantor’s guarantee under Article IX; and provided, further, that no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above to take such action, affect the rights or duties of the Administrative Agent under this Agreement, and provided, further, that the Commitment of any Lender shall not be extended without the prior written consent of such Lender.
 
SECTION 8.02   Notices, Communications and Treatment of Information.   (a)   Notices.   (i)  All notices, demands, requests, consents and other communications provided for in this Agreement shall be given in writing, or by any telecommunication device capable of creating a written record (including electronic mail), and addressed to the party to be notified as follows:

(1)           if to the Company or any other Loan Party,
 
 
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Stanley Black & Decker, Inc.
1000 Stanley Drive
New Britain, Connecticut 06053
Attention of:
Telecopier No.:
E-Mail Address:

(2)           if to the Administrative Agent

Citibank, N.A.
388 Greenwich Street
New York, NY 10013
Attention of:
Telecopier No.:
E-Mail Address:

(3)  if to any Lender, to it at its address (or telecopier number) set forth in its Administrative Questionnaire

or at such other address as shall be notified in writing (x) in the case of the Company and the Administrative Agent, to the other parties and (y) in the case of all other parties, to the Company and the Administrative Agent.
 
(ii)           All notices, demands, requests, consents and other communications described in clause (i)  shall be effective (1) if delivered by hand, including any overnight courier service, upon personal delivery, (2) if delivered by mail, when deposited in the mails, (3) if delivered by posting to an Approved Electronic Platform, an Internet website or a similar telecommunication device requiring that a user have prior access to such Approved Electronic Platform, website or other device (to the extent permitted by Section 8.02(b)   to be delivered thereunder), when such notice, demand, request, consent and other communication shall have been made generally available on such Approved Electronic Platform, Internet website or similar device to the class of Person being notified (regardless of whether any such Person must accomplish, and whether or not any such Person shall have accomplished, any action prior to obtaining access to such items, including registration, disclosure of contact information, compliance with a standard user agreement or undertaking a duty of confidentiality) and such Person has been notified in respect of such posting that a communication has been posted to the Approved Electronic Platform and (4) if delivered by electronic mail or any other telecommunications device, when transmitted to an electronic mail address (or by another means of electronic delivery) as provided in clause (i); provided , however, that notices and communications to the Administrative Agent pursuant to Article 7 shall not be effective until received by the Administrative Agent.
 
(iii)           Notwithstanding clauses (i) and (ii) (unless the Administrative Agent requests that the provisions of clause (i) and (ii) be followed) and any other provision in this Agreement or any other Loan Document providing for the delivery of any Approved Electronic Communication by any other means, the Loan Parties shall deliver all Approved Electronic Communications to the Administrative Agent by properly transmitting such Approved Electronic Communications in an electronic/soft medium in a format acceptable to the Administrative Agent to oploanswebadmin@citigroup.co m or such other electronic mail address (or similar means of electronic delivery) as the Administrative Agent may notify to the Company.  Nothing in this clause (iii) shall prejudice the right of the Administrative Agent or any Lender to deliver any Approved Electronic Communication to any Loan Party in any manner authorized in this Agreement or to request that the Company effect delivery in such manner.
 
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(b)           Posting of Approved Electronic Communications.  (i)  Each of the Lenders and each Loan Party agrees that the Administrative Agent may, but shall not be obligated to, make the Approved Electronic Communications available to the Lenders by posting such Approved Electronic Communications on IntraLinks™ or a substantially similar electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “Approved Electronic Platform”).
 
(ii)           Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Closing Date, a dual firewall and a User ID/Password Authorization System) and the Approved Electronic Platform is secured through a single-user-per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders and each Loan Party acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution.  In consideration for the convenience and other benefits afforded by such distribution and for the other consideration provided hereunder, the receipt and sufficiency of which is hereby acknowledged, each of the Lenders and each Loan Party hereby approves distribution of the Approved Electronic Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.
 
(c)           (i)  THE APPROVED ELECTRONIC PLATFORM AND THE APPROVED ELECTRONIC COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”.  NONE OF THE ADMINISTRATIVE AGENT OR ANY OTHER MEMBER OF THE AGENT’S GROUP WARRANTS THE ACCURACY, ADEQUACY OR COMPLETENESS OF THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM AND EACH EXPRESSLY DISCLAIMS ANY LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM EXCEPT FOR ERRORS OR OMISSIONS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ADMINISTRATIVE AGENT OR ANY OTHER MEMBER OF THE AGENT’S GROUP.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT PARTIES IN CONNECTION WITH THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM.
 
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(ii)           Each of the Lenders and each Loan Party agrees that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Approved Electronic Communications on the Approved Electronic Platform in accordance with the Administrative Agent’s generally-applicable document retention procedures and policies.
 
(d)           Confidentiality.  Each of the Administrative Agent and the Lenders agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it or its Affiliates (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process or in connection with assignments or pledges made in accordance with Section 8.08(c), (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective party and direct or indirect counterparty (or its managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives) to any swap, derivative or other transaction under which payments are to be made by reference to the Company and its obligations, this Agreement or payments hereunder, (iii) any rating agency, or (iv) the CUSIP Service Bureau or any similar organization, (g) with the consent of the Company or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Company.
 
For purposes of this Section, “ Information ” means all information received from the Company or any of its Subsidiaries relating to the Company or any of its Subsidiaries or any of their respective businesses, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Company or any of its Subsidiaries, provided that, in the case of information received from the Company or any of its Subsidiaries after the date hereof, such information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

(e)           Treatment of Information.  (i)  Certain of the Lenders may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that does not contain material non-public information with respect to any of the Loan Parties or their securities (“Restricting Information”).  Other Lenders may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that may contain Restricting Information.  Each Lender acknowledges that United States federal and state securities laws prohibit any person from purchasing or selling securities on the basis of material, non-public information concerning the issuer of such securities or, subject to certain limited exceptions, from communicating such information to any other Person.  Neither the Administrative Agent nor any of its Related Parties shall, by making any Communications (including Restricting Information) available to a Lender, by participating in any conversations or other interactions with a Lender or otherwise, make or be deemed to make any statement with regard to or otherwise warrant that any such information or Communication does or does not contain Restricting Information nor shall the Administrative Agent or any of its Related Parties be responsible or liable in any way for any decision a Lender may make to limit or to not limit its access to Restricting Information.  In particular, none of the Administrative Agent or any of its Related Parties (i) shall have, and the Administrative Agent, on behalf of itself and each of its Related Parties, hereby disclaims, any duty to ascertain or inquire as to whether or not a Lender has or has not limited its access to Restricting Information, such Lender’s policies or procedures regarding the safeguarding of material, nonpublic information or such Lender’s compliance with applicable laws related thereto or (ii) shall have, or incur, any liability to any Loan Party or Lender or any of their respective Related Parties arising out of or relating to the Administrative Agent or any of its Related Parties providing or not providing Restricting Information to any Lender.
 
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(ii)           Each Loan Party agrees that (i) all Communications it provides to the Administrative Agent intended for delivery to the Lenders whether by posting to the Approved Electronic Platform or otherwise shall be clearly and conspicuously marked “PUBLIC” if such Communications do not contain Restricting Information which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof, (ii) by marking Communications “PUBLIC,” each Loan Party shall be deemed to have authorized the Administrative Agent and the Lenders to treat such Communications as either publicly available information or not material information (although, in this latter case, such Communications may contain sensitive business information and, therefore, remain subject to the confidentiality undertakings of Section 8.02(c)) with respect to such Loan Party or its securities for purposes of United States Federal and state securities laws, (iii) all Communications marked “PUBLIC” may be delivered to all Lenders and may be made available through a portion of the Approved Electronic Platform designated “Public Side Information,” and (iv) the Administrative Agent shall be entitled to treat any Communications that are not marked “PUBLIC” as Restricting Information and may post such Communications to a portion of the Approved Electronic Platform not designated “Public Side Information.”  Neither the Administrative Agent nor any of its Affiliates shall be responsible for any statement or other designation by a Loan Party regarding whether a Communication contains or does not contain material non-public information with respect to any of the Loan Parties or their securities nor shall the Administrative Agent or any of its Affiliates incur any liability to any Loan Party, any Lender or any other Person for any action taken by the Administrative Agent or any of its Affiliates based upon such statement or designation, including any action as a result of which Restricting Information is provided to a Lender that may decide not to take access to Restricting Information.  Nothing in this clause (ii) shall modify or limit a Lender’s obligations under Section 8.02(b) with regard to Communications and the maintenance of the confidentiality of or other treatment of Information.
 
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(iii)           Each Lender acknowledges that circumstances may arise that require it to refer to Communications that might contain Restricting Information.  Accordingly, each Lender agrees that it will nominate at least one designee to receive Communications (including Restricting Information) on its behalf and identify such designee (including such designee’s contact information) on such Lender’s Administrative Questionnaire.  Each Lender agrees to notify the Administrative Agent from time to time of such Lender’s designee’s e-mail address to which notice of the availability of Restricting Information may be sent by electronic transmission.
 
(iv)           Each Lender acknowledges that Communications delivered hereunder and under the other Loan Documents may contain Restricting Information and that such Communications are available to all Lenders generally.  Each Lender that elects not to take access to Restricting Information does so voluntarily and, by such election, acknowledges and agrees that the Administrative Agent and other Lenders may have access to Restricting Information that is not available to such electing Lender.  None of the Administrative Agent or any Lender with access to Restricting Information shall have any duty to disclose such Restricting Information to such electing Lender or to use such Restricting Information on behalf of such electing Lender, and shall not be liable for the failure to so disclose or use, such Restricting Information.
 
(v)           The provisions of the foregoing clauses of this subsection (d) are designed to assist the Administrative Agent, the Lenders and the Loan Parties, in complying with their respective contractual obligations and applicable law in circumstances where certain Lenders express a desire not to receive Restricting Information notwithstanding that certain Communications hereunder or under the other Loan Documents or other information provided to the Lenders hereunder or thereunder may contain Restricting Information.  Neither the Administrative Agent nor any of its Related Parties warrants or makes any other statement with respect to the adequacy of such provisions to achieve such purpose nor does the Administrative Agent or any of its Related Parties warrant or make any other statement to the effect that any Loan Party’s or Lender’s adherence to such provisions will be sufficient to ensure compliance by such Loan Party or Lender with its contractual obligations or its duties under applicable law in respect of Restricting Information and each of the Lenders and each Loan Party assumes the risks associated therewith.
 
SECTION 8.03   No Waiver; Remedies.  No failure on the part of any Lender or the Administrative Agent to exercise, and no delay in exercising, any right hereunder or under any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.  The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
 
SECTION 8.04   Costs and Expenses; Breakage Indemnification.   (a)  The Company agrees to pay on demand all reasonable costs and expenses, if any (including, without limitation, reasonable counsel fees and expenses), of (i) the Administrative Agent in connection with the negotiation, syndication, execution and delivery of this Agreement, the other Loan Documents and the other documents delivered hereunder and (ii) the Administrative Agent and each Lender in connection with enforcement (whether through negotiations, legal proceedings or otherwise) of this Agreement, the Notes and the other documents to be delivered hereunder, including, without limitation, reasonable counsel fees and expenses in connection with the enforcement of rights under this Section 8.04(a).
 
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(b)           If any payment, prepayment or conversion of any Eurocurrency Rate Advance is made by the Company or a Designated Borrower, as applicable, to or for the account of a Lender other than on the last day of the Interest Period for such Advance, as a result of acceleration of the maturity of the Advances and the Notes pursuant to Section 6.01 or for any other reason other than in connection with Section 2.02(c), such Borrower shall, upon demand by such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender any amounts required to compensate such Lender for any additional losses, costs or expenses which it may reasonably incur as a result of such payment, including, without limitation, any loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund or maintain such Advance.
 
(c)           The Company agrees to indemnify and hold harmless the Administrative Agent and each Lender and each of their affiliates and their officers, directors, employees, agents and advisors (each, an “Indemnified Party”) from and against any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or by reason of, or in connection with the preparation for a defense of, any investigation, litigation or proceeding arising out of, related to or in connection with the actual or proposed use of the proceeds of the Advances, including in connection with any acquisition or proposed acquisition by the Company or any Subsidiary of the Company of another Person or one or more businesses of another Person (whether by means of a stock purchase, asset acquisition or otherwise), whether or not such investigation, litigation or proceeding is brought by the Company, its directors, shareholders or creditors or an Indemnified Party or any other Person or any Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated, except to the extent such claim, damage, loss, liability or expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s gross negligence or willful misconduct.  The Company agrees not to assert any claim against any Indemnified Party on any theory of liability, for consequential, indirect, special or punitive damages arising out of or otherwise relating to this Agreement or any of the transactions contemplated hereby or the actual or proposed use of the proceeds of the Advances.
 
(d)           Without prejudice to the survival of any other agreement of the Loan Parties hereunder, the agreements and obligations of the Loan Parties contained in Sections 2.08, 2.10 and 8.04 shall survive the payment in full of principal, interest and all other amounts payable hereunder and under the Notes.
 
SECTION 8.05   Sharing of Payments, Etc.   If any Lender shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) on account of the Advances owing to it (other than pursuant to Section 2.02(d), 2.06, 2.08, 2.10 or 8.04(b)) in excess of its ratable share of payments on account of the Advances obtained by all the Lenders, such Lender shall forthwith purchase from the other Lenders such participations in the Advances owing to them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each Lender shall be rescinded and such Lender shall repay to the purchasing Lender the purchase price to the extent of such recovery together with an amount equal to such Lender’s ratable share (according to the proportion of (i) the amount of such Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered.  The Company agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 8.05 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Company in the amount of such participation.
 
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SECTION 8.06   Binding Effect .   This Agreement shall be binding upon and inure to the benefit of the Company, the Subsidiary Guarantor, each Designated Borrower, the Administrative Agent and the Lenders and their respective successors and assigns, except that no Loan Party shall have the right to assign its rights or obligations hereunder or under any Note or any interest herein or therein (other than as permitted by Section 5.02(b)) without the prior written consent of the Lenders.
 
SECTION 8.07   Assignments and Participations.   (a)  Each Lender may assign to one or more Persons (other than the Company or any of its Affiliates) all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment, and the Advances owing to it and the Note or Notes held by it); provided, however, that (i) each such assignment (other than assignment to an affiliate of such Lender) shall require the prior written consent of the Company, which consent shall not be unreasonably withheld or delayed, and which consent of the Company shall not be required if an Event of Default exists, (ii) each such assignment shall be of a constant, and not a varying, percentage of all rights and obligations under this Agreement, (iii) except in the case of an assignment to a Person that, immediately prior to such assignment, was a Lender or an assignment of all of a Lender’s rights and obligations under this Agreement, the amount of the Commitment of the assigning Lender being assigned pursuant to each such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall in no event be less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof, and (iv) the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance (which shall include the agreement of the assignee party to such assignment, for the benefit of the Borrowers, to be bound by the terms and provisions of this Agreement to the same extent as if it were an original party hereto), together with any Note subject to such assignment and the assignor or assignee shall pay to the Administrative Agent a processing and recordation fee of $3,500.  Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Assignment and Acceptance, (x) the assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Lender hereunder and (y) the Lender assignor thereunder shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all or the remaining portion of an assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto).
 
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(b)           By executing and delivering an Assignment and Acceptance, the Lender assignor thereunder and the assignee thereunder confirm to and agree with each other and the other parties hereto as follows:  (i) other than as provided in such Assignment and Acceptance, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other instrument or document furnished pursuant hereto; (ii) such assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Loan Party or the performance or observance by any Loan Party of any of its obligations under this Agreement or any other instrument or document furnished pursuant hereto; (iii) such assignee confirms that it has received a copy of this Agreement, together with copies of the financial statements referred to in Section 4.01 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance; (iv) such assignee will, independently and without reliance upon the Administrative Agent, such assigning Lender or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement; (v) such assignee appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under this Agreement as are delegated to the Administrative Agent by the terms hereof, together with such powers and discretion as are reasonably incidental thereto; and (vi) such assignee agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as a Lender.
 
(c)           Upon its receipt of an Assignment and Acceptance executed by an assigning Lender and an assignee, together with any Note or Notes subject to such assignment, the Administrative Agent shall, if such Assignment and Acceptance has been completed and is in substantially the form of Exhibit D hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the Company.  In the case of any Lender that holds a Note, within five Business Days after its receipt of such notice, the relevant Borrower, at its own expense, shall execute and deliver to the Administrative Agent in simultaneous exchange for the surrendered Note a new Note to the order of such assignee in an amount equal to the Commitment assumed by it pursuant to such Assignment and Acceptance and, if the assigning Lender has retained a Commitment hereunder, a new Note to the order of the assigning Lender in an amount equal to the Commitment retained by it hereunder.  Such new Note or Notes shall be in an aggregate principal amount equal to the aggregate principal amount of such surrendered Note or Notes, shall be dated the effective date of such Assignment and Acceptance and shall otherwise be in substantially the form of Exhibit E.  Such Assignment and Acceptance shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Person as a Lender and the resulting adjustment of the Commitments, if any, arising from such assignment of Commitments to such Person.
 
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(d)           The Administrative Agent, acting solely for this purpose as an agent of the Borrowers, shall maintain at its address referred to in Section 8.02 a copy of each Assignment and Acceptance delivered to and accepted by it and a register for the recordation of the names and addresses of the Lenders and the Commitment of, and principal amount of the Advances owing to, each Lender from time to time (the “Register”).  The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Loan Parties, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement.  The Register shall be available for inspection by the Company or any Lender at any reasonable time and from time to time upon reasonable prior notice.
 
(e)           Each Lender may sell participations to one or more banks or other financial institutions, or other entities engaged in making, purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the ordinary course of their business, in all or a portion of its rights and/or obligations under this Agreement (including, without limitation, all or a portion of its Commitment and the Advances owing to it and the Note or Notes held by it); provided that (i) such Lender’s obligations under this Agreement (including, without limitation, its Commitment) shall remain unchanged, (ii) such Lender shall remain solely responsible to the Borrowers for the performance of such obligations, (iii) the Loan Parties shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and (iv) such participant’s right to consent to any modification, waiver or release of any of the provisions of this Agreement shall be limited to the right to consent to (A) any reduction in principal, interest or fees payable to such Lender under this Agreement, (B) the postponement of any date fixed for the payment of any principal, interest or fees under this Agreement and (C) any amendments to the foregoing clauses (A) and (B).
 
SECTION 8.08   Limitation on Assignments and Participations.   (a)  Any Lender may, in connection with any actual or proposed assignment or participation pursuant to Section 8.07, disclose to the actual or proposed assignee or participant any information relating to any Loan Party furnished to such Lender by or on behalf of such Loan Party; provided that the actual or proposed assignee or participant shall have agreed prior to any such disclosure to preserve the confidentiality of any confidential information relating to such Loan Party received by it from such Lender or such Loan Party.
 
(b)           Notwithstanding anything in Section 8.07 to the contrary, no Lender shall have the right to assign its rights and obligations hereunder or any interest therein or to sell participations to one or more banks or other financial institutions in all or a portion of its rights hereunder or any interest therein where the result of such assignment or participation would be reasonably expected to entitle the Lender to claim additional amounts pursuant to Section 2.02(d), 2.06, 2.08, 2.10 or 8.04 or would otherwise result in an increase in a Borrower’s obligations.
 
(c)           Anything in this Section 8.08 to the contrary notwithstanding, any Lender may assign and pledge all or any portion of its rights to payment of the Advances owing to it hereunder to any Federal Reserve Bank (and its transferees) as collateral security (i) pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any applicable Operating Circular issued by such Federal Reserve Bank or (ii) to any central bank having jurisdiction over such Lender.  No such assignment shall have the effect of releasing such Lender from its obligations hereunder.
 
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SECTION 8.09   Withholding.   If any Lender, or any Person that becomes a party to this Agreement pursuant to Section 8.07, is not incorporated under the laws of the United States of America or a state thereof, such Person agrees that, prior to the first date on which any payment is due to it hereunder, it will deliver to each of the Company and the Administrative Agent (i) two duly completed copies of United States Internal Revenue Service Form W-8BEN or W-8ECI or successor applicable form, as the case may be, certifying in each case that such Person is entitled to receive payments under this Agreement, without deduction or withholding of any United States federal income taxes, and (ii) an Internal Revenue Service Form W-8BEN or successor applicable form, as the case may be, to establish an exemption from United States backup withholding tax.  Each Person which delivers to the Company a Form W-8BEN or W-8ECI pursuant to the preceding sentence further undertakes to deliver to each of the Company and the Administrative Agent two further copies of Form W-8BEN or W-8ECI, or successor applicable forms, or other manner of certification, as the case may be, on or before the date that any such form expires or becomes obsolete or after the occurrence of any event requiring a change in the most recent form previously delivered by it to the Company and the Administrative Agent, and such extensions or renewals thereof as may reasonably be requested by the Company or the Administrative Agent, certifying in the case of a Form W-8BEN or W-8ECI that such Person is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes, unless in any such case an event (including, without limitation, any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such forms inapplicable or which would prevent such Person from duly completing and delivering any such form with respect to it and such Person advises the Company and the Administrative Agent that it is not capable of receiving payments without any deduction or withholding of United States federal income tax, and in the case of a Form W-8BEN, establishing an exemption from United States backup withholding tax.
 
SECTION 8.10   Mitigation.   In the event that any Lender claims any amounts under Sections 2.02(d), 2.06, 2.08, 2.10 or 8.04(b), it shall use all reasonable efforts (consistent with its internal policies and legal and regulatory restrictions) to take actions (including, without limitation, changing the jurisdiction of its Applicable Lending Office) so as to eliminate such additional amounts; provided that such Lender shall not be required to take any action if, in its reasonable judgment, such action would be materially disadvantageous to it.
 
SECTION 8.11   Governing Law; Waiver of Jury Trial.   THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 
SECTION 8.12   Execution in Counterparts.   This Agreement may be executed in any number of counterparts each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page to this Agreement by telecopier shall be effective as delivery of a manually executed counterpart of this Agreement.
 
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SECTION 8.13   Submission to Jurisdiction; Etc.
 
(a)           Submission to Jurisdiction.  Each Loan Party hereby submits to the nonexclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York State court sitting in New York City for purposes of all legal proceedings arising out of or relating to this Agreement and the Notes.
 
(b)           Service of Process.  Each Designated Borrower agrees that service of process in any action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to CT Corporation System (the “Process Agent”) as agent for such Designated Borrower in New York, New York for service of process at its address at 111 Eighth Avenue, New York, New York  10011, or at such other address of which the Administrative Agent shall have been notified in writing by such Designated Borrower; provided that, if the Process Agent ceases to act as such Designated Borrower’s agent for service of process, such Designated Borrower will, by an instrument reasonably satisfactory to the Administrative Agent, appoint another Person (subject to the approval of the Administrative Agent) in the Borough of Manhattan, New York, New York to act as such Designated Borrower’s agent for service of process.  Each other party hereto irrevocably consents to service of process in the manner provided for notices in Section 8.02.  Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by applicable law.
 
(c)           Waiver of Venue.  Each Loan Party irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and a claim that such proceeding brought in such a court has been brought in an inconvenient forum.
 
SECTION 8.14   Judgment Currency.  This is an international loan transaction in which the specification of Dollars or an Alternate Currency, as the case may be (the “ Specified Currency ”), and any payment in New York City or the country of the Specified Currency, as the case may be (the “ Specified Place ”), is of the essence, and, except as otherwise provided in this Agreement, the Specified Currency shall be the currency of account in all events relating to Advances denominated in the Specified Currency.  Except as otherwise provided in this Agreement, the payment obligations of the Designated Borrowers under this Agreement and the other Loan Documents shall not be discharged by an amount paid in another currency or in another place, whether pursuant to a judgment or otherwise, to the extent that the amount so paid on conversion to the Specified Currency and transfer to the Specified Place under normal banking procedures does not yield the amount of the Specified Currency at the Specified Place due hereunder.  If for the purpose of obtaining judgment in any court it is necessary to convert a sum due hereunder in the Specified Currency into another currency (the “ Second Currency ”), the rate of exchange which shall be applied shall be that at which in accordance with normal banking procedures the Administrative Agent could purchase the Specified Currency with the Second Currency on the Business Day next preceding that on which such judgment is rendered.  The obligation of each Designated Borrower in respect of any such sum due from it to the Administrative Agent or any Lender in respect of any judgment in any court shall, notwithstanding the rate of exchange actually applied in rendering such judgment, be discharged only to the extent that on the Business Day following receipt by the Administrative Agent or such Lender, as the case may be, of any sum adjudged to be due hereunder or under the Notes in the Second Currency to the Administrative Agent or such Lender, as the case may be, may in accordance with normal banking procedures purchase and transfer to the Specified Place the Specified Currency with the amount of the Second Currency so adjudged to be due; and the Company hereby, as a separate obligation and notwithstanding any such judgment, agrees to indemnify the Administrative Agent or such Lender, as the case may be, against, and to pay the Administrative Agent or such Lender, as the case may be, on demand in the Specified Currency, any difference between the sum originally due to the Administrative Agent or such Lender, as the case may be, for such judgment in the Specified Currency and the amount of the Specified Currency so purchased and transferred.
 
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SECTION 8.15   USA PATRIOT Act.  Each Lender hereby notifies each Loan Party that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of the Borrowers and other information that will allow such Lender to identify the Loan Parties in accordance with the Act.
 
SECTION 8.16   No Fiduciary Duty.  The Administrative Agent, each Lender and their Affiliates (collectively, solely for purposes of this paragraph, the “ Lenders ”), may have economic interests that conflict with those of the Loan Parties.  Each of the Loan Parties agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between the Lenders and any Loan Party, its stockholders or its affiliates.  Each of the Loan Parties acknowledge and agree that (i) the transactions contemplated by the Loan Documents are arm’s-length commercial transactions between the Lenders, on the one hand, and each of the Loan Parties, on the other, (ii) in connection therewith and with the process leading to such transaction each of the Lenders is acting solely as a principal and not the agent or fiduciary of any Loan Party, its management, stockholders, creditors or any other person, (iii) no Lender has assumed an advisory or fiduciary responsibility in favor of any Loan Party with respect to the transactions contemplated hereby or the process leading thereto (irrespective of whether any Lender or any of its affiliates has advised or is currently advising any Loan Party on other matters) or any other obligation to any Loan Party except the obligations expressly set forth in the Loan Documents and (iv) each of the Loan Parties has consulted its own legal and financial advisors to the extent it deemed appropriate.  Each of the Loan Parties further acknowledges and agrees that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto.  Each of the Loan Parties agree that it will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to any Loan Party, in connection with such transaction or the process leading thereto.
 

ARTICLE IX

GUARANTEE

SECTION 9.01   Guarantee; Limitation of Liability.  (a)  To induce the other parties to enter into this Agreement and for other valuable consideration, receipt of which is hereby acknowledged, each of the Guarantors, jointly and severally, hereby unconditionally and irrevocably guarantees to the Administrative Agent, each Lender and their respective successors and permitted assigns the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the principal of and interest on the Advances to and the Notes of each other Loan Party and all other amounts whatsoever now or hereafter payable or becoming payable by each other Loan Party under this Agreement and each other Loan Document, in each case strictly in accordance with the terms thereof (collectively, the “ Guaranteed Obligations ”).  Each Guarantor hereby further agrees that if any other Loan Party shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, such Guarantor will promptly pay the same, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.  This Section 9.01 is a continuing guarantee and is a guarantee of payment and is not merely a guarantee of collection and shall apply to all Guaranteed Obligations whenever arising.
 
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(b)           Each Guarantor, and by its acceptance of this Article IX, the Administrative Agent and each Lender, hereby confirms that it is the intention of all such Persons that this Article IX and the obligations of each Guarantor hereunder not constitute a fraudulent transfer or conveyance for purposes of any bankruptcy law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to this guarantee and the obligations of each Guarantor hereunder.  To effectuate the foregoing intention, the Administrative Agent, the Lenders and the Guarantors hereby irrevocably agree that the obligations of the Subsidiary Guarantor under this Article IX at any time shall be limited to the maximum amount as will result in the obligations of such Guarantor under this Article IX not constituting a fraudulent transfer or conveyance.
 
(c)           Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment shall be required to be made to the Administrative Agent or any Lender under this Article IX or any other guarantee, such Guarantor will contribute, to the maximum extent permitted by law, such amounts to each other Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Administrative Agent and the Lenders under or in respect of the Loan Documents.
 
SECTION 9.02   Acknowledgments, Waivers and Consents.  Each Guarantor agrees that its obligations under Section 9.01 shall be primary, absolute, irrevocable and unconditional under any and all circumstances and that the guarantee therein is made with respect to any Guaranteed Obligations now existing or in the future arising.  Without limiting the foregoing, each Guarantor agrees that:
 
(a)           The occurrence of any one or more of the following shall not affect the enforceability or effectiveness of this Article IX in accordance with its terms or affect, limit, reduce, discharge or terminate the liability of such Guarantor, or the rights, remedies, powers and privileges of the Administrative Agent or any Lender, under this Article IX:
 
(i)      any modification or amendment (including by way of amendment, extension, renewal or waiver), or any acceleration or other change in the time for payment or performance of the terms of all or any part of the Guaranteed Obligations or any Loan Document, or any other agreement or instrument whatsoever relating thereto, or any modification of the Commitments;
 
 
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(ii)           any release, termination, waiver, abandonment, lapse or expiration, subordination or enforcement of the liability of any other guarantee of all or any part of the Guaranteed Obligations;
 
(iii)          any application of the proceeds of any other guarantee (including the obligations of any other guarantor of all or any part of the Guaranteed Obligations) to all or any part of the Guaranteed Obligations in any such manner and to such extent as the Administrative Agent may determine;
 
(iv)          any release of any other Person (including any other guarantor with respect to all or any part of the Guaranteed Obligations) from any personal liability with respect to all or any part of the Guaranteed Obligations;
 
(v)           any settlement, compromise, release, liquidation or enforcement, upon such terms and in such manner as the Administrative Agent may determine or as applicable law may dictate, of all or any part of the Guaranteed Obligations or any other guarantee of (including any letter of credit issued with respect to) all or any part of the Guaranteed Obligations;
 
(vi)          the giving of any consent to the merger or consolidation of, the sale of substantial assets by, or other restructuring or termination of the corporate existence of, any other Loan Party or any other Person or any disposition of any shares of any Loan Party;
 
(vii)         any proceeding against any other Loan Party or any other guarantor of all or any part of the Guaranteed Obligations or any collateral provided by any other Person or the exercise of any rights, remedies, powers and privileges of the Administrative Agent and the Lenders under the Loan Documents or otherwise in such order and such manner as the Administrative Agent may determine, regardless of whether the Administrative Agent or the Lenders shall have proceeded against or exhausted any collateral, right, remedy, power or privilege before proceeding to call upon or otherwise enforce this Article IX;
 
(viii)        the entering into such other transactions or business dealings with any other Loan Party, any Subsidiary or affiliate thereof or any other guarantor of all or any part of the Guaranteed Obligations as the Administrative Agent or any Lender may desire; or
 
(ix)          all or any combination of any of the actions set forth in this Section 9.02(a).
 
(b)           The enforceability and effectiveness of this Article IX and the liability of such Guarantor, and the rights, remedies, powers and privileges of the Administrative Agent and the Lenders, under this Article IX shall not be affected, limited, reduced, discharged or terminated, and each Guarantor hereby expressly waives to the fullest extent permitted by law any defense now or in the future arising, by reason of:
 
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(i)            the illegality, invalidity or unenforceability of all or any part of the Guaranteed Obligations, any Loan Document or any other agreement or instrument whatsoever relating to all or any part of the Guaranteed Obligations;
 
(ii)           any disability or other defense with respect to all or any part of the Guaranteed Obligations, including the effect of any statute of limitations that may bar the enforcement of all or any part of the Guaranteed Obligations or the obligations of any other guarantor of all or any part of the Guaranteed Obligations;
 
(iii)          the illegality, invalidity or unenforceability of any security for or other guarantee (including any letter of credit) of all or any part of the Guaranteed Obligations or the lack of perfection or continuing perfection or failure of the priority of any Lien on any collateral for all or any part of the Guaranteed Obligations;
 
(iv)          the cessation, for any cause whatsoever, of the liability of any other Loan Party or any other guarantor with respect to all or any part of the Guaranteed Obligations (other than, subject to Section 9.03, by reason of the full payment of all Guaranteed Obligations);
 
(v)           any failure of the Administrative Agent or any Lender to marshal assets in favor of any other Loan Party or any other Person (including any other guarantor of all or any part of the Guaranteed Obligations), to exhaust any collateral for all or any part of the Guaranteed Obligations, to pursue or exhaust any right, remedy, power or privilege it may have against such other Loan Party or any other guarantor of all or any part of the Guaranteed Obligations or any other Person or to take any action whatsoever to mitigate or reduce such or any other Person’s liability, the Administrative Agent and the Lenders being under no obligation to take any such action notwithstanding the fact that all or any part of the Guaranteed Obligations may be due and payable and that such other Loan Party may be in default of its obligations under any Loan Document;
 
(vi)          any counterclaim, set-off or other claim which any other Loan Party or any other guarantor of all or any part of the Guaranteed Obligations has or claims with respect to all or any part of the Guaranteed Obligations, or any counterclaim, set-off or other claim which such Guarantor may have with respect to all or any part of any obligations owed to such Guarantor by the Administrative Agent or any Lender (other than, without prejudice to Section 9.03, any counterclaim or other claim that the amount of such Guaranteed Obligation which is being claimed has been finally paid in full);
 
(vii)         any failure of the Administrative Agent or any Lender or any other Person to file or enforce a claim in any bankruptcy or other proceeding with respect to any Person;
 
(viii)        any bankruptcy, insolvency, reorganization, winding-up or adjustment of debts, or appointment of a custodian, liquidator or the like of it, or similar proceedings commenced by or against any Person, including any discharge of, or bar or stay against collecting, all or any part of the Guaranteed Obligations (or any interest on all or any part of the Guaranteed Obligations) in or as a result of any such proceeding;
 
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(ix)          any action taken by the Administrative Agent or any Lender that is authorized under this Article IX or by any other provision of any Loan Document or any omission to take any such action;
 
(x)           any law, regulation, decree or order of any jurisdiction or Governmental Authority or any event affecting any term of the Guaranteed Obligations; or
 
(xi)          any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor.
 
(c)           To the fullest extent permitted by law, each Guarantor expressly waives, for the benefit of the Administrative Agent and the Lenders, all diligence, presentment, demand for payment or performance, notices of nonpayment or nonperformance, protest, notices of protest, notices of dishonor and all other notices or demands of any kind or nature whatsoever, and any requirement that the Administrative Agent or any Lender exhaust any right, power or remedy or proceed against any other Loan Party under any Loan Document or other agreement or instrument referred to herein or therein, or against any other Person under any other guarantee of, or security for, any of the Guaranteed Obligations, and all notices of acceptance of this Article IX or of the existence, creation, incurring or assumption of new or additional Guaranteed Obligations.
 
SECTION 9.03   Reinstatement.  The obligations of each Guarantor under this Article IX shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of any other Loan Party in respect of the Guaranteed Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any Lender, whether as a result of insolvency, any proceedings in bankruptcy, dissolution, liquidation or reorganization or otherwise.
 
SECTION 9.04   Subrogation.  Each Guarantor hereby agrees that, until the final payment in full of all Guaranteed Obligations, it shall not exercise any right or remedy arising by reason of any performance by it of its guarantee in Section 9.01, whether by subrogation, reimbursement, contribution or otherwise, against any other Loan Party or any other guarantor of any of the Guaranteed Obligations or any security for any of the Guaranteed Obligations.
 
SECTION 9.05   Remedies.   Each Guarantor agrees that, as between such Guarantor and the Administrative Agent and the Lenders, the obligations of any other Loan Party under this Agreement or any other Loan Documents may be declared to be forthwith due and payable as provided in Section 6.01 (and shall be deemed to have become automatically due and payable in the circumstances provided in said Section 6.01) for purposes of Section 9.01, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against such other Loan Party and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by such other Loan Party) shall forthwith become due and payable by such Guarantor for purposes of Section 9.01.
 
SECTION 9.06   Payments.   Each payment by any Guarantor under this Article IX shall be made in accordance with Section 2.09 in the Currency in which the Guaranteed Obligations in respect of which such payment is made in respect of are denominated, without deduction, set-off or counterclaim at the Administrative Agent’s Account and free and clear of any and all present and future Taxes.
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective signatories thereunto duly authorized, as of the date first above written.
 
 
 
STANLEY BLACK & DECKER, INC.
 
 
       
 
By
/s/  Craig A. Douglas  
    Name:  Craig A. Douglas  
    Title:    VP & Treasurer  
       

 
 
THE BLACK & DECKER CORPORATION, as Subsidiary Guarantor
 
 
       
 
By
/s/  Mark Rothleitner  
    Name:  Mark Rothleitner  
    Title:    Assistant Treasurer  
       

 
 
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CITIBANK, N.A.,
  as Administrative Agent and as Lender
 
 
       
 
By
/s/  Carolyn Kee  
    Name:  Carolyn Kee  
    Title:    Vice President  
       
 
 
 
 
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LENDERS
 
 
BANK OF AMERICA, N.A.
 
 
 
       
 
By
/s/  Jeffrey J. McLaughlin  
    Name:  Jeffrey J. McLaughlin  
    Title:    SVP  
       
 
 
 
 
 
 
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J.P. MORGAN CHASE BANK, N.A.
 
       
 
By
/s/  Anthony W. White  
    Name:  Anthony W. White   
    Title:    Vice President  
       
 
 
 
BARCLAYS BANK PLC
 
       
 
By
/s/  Kevin Cullen  
    Name:  Kevin Cullen  
    Title:    Director  
       
 

 
 
BNP PARIBAS
 
       
 
By
/s/  Curt Price  
    Name:  Curt Price  
    Title:    Managing Director  
       
  By /s/  Fik Durmus  
    Name:  Fik Durmus  
    Title:    Director  
       


  CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH  
       
 
By:
/s/ John D. Toronto  
    Name:  John D. Toronto     
    Title:    Director  
       
  By: /s/  Vipul Dhadda  
    Name:  Vipul Dhadda  
    Title:    Associate  
 
 
 
 
GOLDMAN SACHS BANK USA
 
       
 
By
/s/  Mark Walton  
    Name:  Mark Walton  
    Title:    Authorized Signatory  
       
 
 
 
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  UBS LOAN FINANCE LLC  
       
 
By:
/s/ Irja R. Otsa  
    Name:  Irja R. Otsa  
    Title:    Associate Director  
       
  By: /s/  Mary E. Evans  
    Name:  Mary E. Evans  
    Title:    Associate Director  
 
 
 
 
THE BANK OF NEW YORK MELLON
 
       
 
By
/s/ Donald G. Cassidy, Jr.  
    Name:  Donald G. Cassidy, Jr.  
    Title:    Managing Director  
       

 
 
HSBC BANK USA, NATIONAL ASSOCIATION
 
       
 
By
/s/  Manuel Burgue ño  
    Name:  Manuel Burgue ño  
    Title:    Vice President, Relationship Manager   
       

 
 
MORGAN STANLEY BANK, N.A.
 
       
 
By
/s/  Melissa James  
    Name:  Melissa James   
    Title:    Authorized Signatory  
       

 
 
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.
 
       
 
By
/s/  Maria Iarriccio  
    Name:  Maria Iarriccio  
    Title:    Authorized Signatory  
       

 
 
 
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  ING BANK N.V., DUBLIN BRANCH  
       
 
By:
/s/  Padraig Matthews  
    Name:  Padraig Matthews  
    Title:    Vice President  
       
  By: /s/  Aidan Neill  
    Name:  Aidan Neill   
    Title:    Director  
 
 
 
 
ROYAL BANK OF CANADA
 
       
 
By
/s/  Dustin Craven  
    Name:  Dustin Craven   
    Title:    Authorized Signatory  
       

 
 
THE BANK OF NOVA SCOTIA
 
       
 
By
/s/  Todd Meller  
    Name:  Todd Meller  
    Title:    Managing Director  
       


  COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES  
       
 
By:
/s/  Robert S. Taylor, Jr.  
    Name:  Robert S. Taylor, Jr.   
    Title:    Senior Vice President  
       
  By: /s/  Sandy Bau  
    Name:  Sandy Bau   
    Title:    Assistant Treasurer  
 
 
 
THE NORTHERN TRUST COMPANY
 
       
 
By
/s/  Peter J. Hallan  
    Name:  Peter J. Hallan   
    Title:    Vice President  
       

 
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RBS CITIZENS, N.A.
 
       
 
By
/s/  Jeff Lynch  
    Name:  Jeff Lynch   
    Title:    Senior Vice President  
       

 
 
MIZUHO CORPORATE BANK (USA)
 
       
 
By
/s/  David Lim  
    Name:  David Lim  
    Title:    Senior Vice Presiden  
       

 
 
PNC BANK, NATIONAL ASSOCIATION
 
       
 
By
/s/  Denise D. Killen  
    Name:  Denise D. Killen  
    Title:    Senior Vice President  
       

 
  INTESA SANPAOLO SPA  
       
 
By:
/s/  John J. Michalisin  
    Name:  John J. Michalisin   
    Title:    First Vice President  
       
  By: /s/  Francesco Di Mario  
    Name:  Francesco Di Mario   
    Title:    First Vice President & Credit Manager  
 
 
  SKANDINAVISKA ENSKILDA BANKEN AB (PUBL)  
       
 
By:
/s/  Simon Wakefield  
    Name:  Simon Wakefield   
    Title:    Global Head of Acquisition Finance  
       
  By: /s/  Krissy Rands  
    Name:  Krissy Rands   
       
 
 
 
SOCIETE GENERALE
 
       
 
By
/s/  Eric E.O.Siebert, Jr.  
    Name:  Eric E.O.Siebert, Jr.   
    Title:    Managing Director  
       
 
 
 
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  STANDARD CHARTERED BANK  
       
 
By:
/s/  James P. Hughes  
    Name:  James P. Hughes   
    Title:    Director  
       
  By: /s/  Robert K. Reddington  
    Name:  Robert K. Reddington   
    Title:    AVP/Credit Documentation Credit Risk Control  
 
 
 
 
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SCHEDULE I

ADDRESS AND APPLICABLE LENDING OFFICES

Name of Lenders and Addresses
For Notices
Domestic Lending Office
Eurocurrency Lending Office
Citibank, N.A.
Building #3
1615 Brett Rd
New Castle, DE  19720
 
Attn: Bank Loan Syndications
Fax 212-994-0961
Citibank, N.A.
Building #3
1615 Brett Rd
New Castle, DE  19720
 
Attn: Bank Loan Syndications
Fax 212-994-0961
Citibank, N.A.
Building #3
1615 Brett Rd
New Castle, DE  19720
 
Attn: Bank Loan Syndications
Fax 212-994-0961
Bank of America, N.A.
100 Federal Street
Boston, MA  02110
 
Attn:  Jeff McLaughlin
Tel: (617) 434.8332
Fax: (617) 434.8426
Bank of America, N.A.
100 Federal Street
Boston, MA  02110
 
Attn:  Jeff McLaughlin
Tel: (617) 434.8332
Fax: (617) 434.8426
Bank of America, N.A.
100 Federal Street
Boston, MA  02110
 
Attn:  Jeff McLaughlin
Tel: (617) 434.8332
Fax: (617) 434.8426
 
 
 

 
SCHEDULE I (cont’d)

LENDERS AND COMMITMENTS
 
Lenders
 
Commitment
 
       
Citibank, N.A.
  $ 40,000,000  
Bank of America, N.A.
  $ 5,000,000  
JP Morgan Chase Bank, N.A.
    55,000,000  
Barclays Bank PLC
    50,000,000  
BNP Paribas
    35,000,000  
Credit Suisse AG
    100,000,000  
Goldman Sachs Bank USA
    50,000,000  
UBS Loan Finance LLC
    35,000,000  
Wells Fargo Bank N.A.
    100,000,000  
The Bank of New York Mellon
    10,000,000  
HSBC Bank USA, National Association
    10,000,000  
Morgan Stanley Bank, N.A. (Morgan Stanley MUFG Loan Partners, LLC)
    10,000,000  
The Bank of Tokyo-Mitsubishi UFJ, Ltd. (Morgan Stanley MUFG Loan Partners, LLC)
    40,000,000  
ING Bank N.V., Dublin Branch
    40,000,000  
Royal Bank of Canada
    5,000,000  
The Bank of Nova Scotia
    30,000,000  
Commerzbank AG, New York and Grand Cayman Branches
    30,000,000  
The Northern Trust Company
    5,000,000  
RBS Citizens, N.A.
    30,000,000  
Mizuho Corporate Bank (USA)
    20,000,000  
PNC Bank, National Association
    20,000,000  
Intesa Sanpaolo S.p.A.
    20,000,000  
Skandinaviska Enskilda Banken AB
    20,000,000  
Societe Generale
    20,000,000  
Standard Chartered Bank
    20,000,000  
         
TOTAL
  $ 700,000,000  
 
 
 

SCHEDULE II


MANDATORY COST RATE

Calculation of Mandatory Cost Rate

1.
The MCR Cost is an addition to the interest rate to compensate Lenders for the cost of compliance with (a) the requirements of the Bank of England and/or the Financial Services Authority (or, in either case, any other authority which replaces all or any of its functions) or (b) the requirements of the European Central Bank.
 
2.
On the first day of each Interest Period for any Advance denominated in Pounds Sterling or Euros (or as soon as possible thereafter) the Administrative Agent shall calculate, as a percentage rate, a rate (the “ Additional Cost Rate ”) for each Lender participating in such Advance, in accordance with the paragraphs set out below.  The MCR Cost will be calculated by the Administrative Agent as a weighted average of such Lenders’ Additional Cost Rates (weighted in proportion to the percentage participation of each such Lender in the relevant Advance) and will be expressed as a percentage rate per annum.
 
3.
The Additional Cost Rate for any Lender lending from an Applicable Lending Office in a Participating Member State (as defined in Section 2.15) will be the percentage notified by that Lender to the Administrative Agent.  This percentage will be certified by that Lender in its notice to the Administrative Agent to be its reasonable determination of the cost (expressed as a percentage of that Lender’s participation in all Advances made from that Applicable Lending Office) of complying with the minimum reserve requirements of the European Central Bank in respect of loans made from that Applicable Lending Office.
 
4.
The Additional Cost Rate for any Lender lending from an Applicable Lending Office in the United Kingdom will be calculated by the Administrative Agent as follows:
 
(a)
in relation to an Advance made in Pounds Sterling:
 
AB + C(B – D) + E × 0.01
  per cent. per annum
100 – (A + C)

 
(b)
in relation to a Advance made in any Alternate Currency other than Pounds Sterling:
 
E × 0.01
  per cent. per annum
300

 

 
Where:
 
 
A
is the percentage of Eligible Liabilities (assuming these to be in excess of any stated minimum) which such Lender is from time to time required to maintain as an interest free cash ratio deposit with the Bank of England to comply with cash ratio requirements.
 
 
B
is the percentage rate of interest (excluding the Applicable Margin and the MCR Cost and, if applicable, any additional amount of interest specified in Section 2.07(b)) payable for the relevant Interest Period on the Advance.
 
 
C
is the percentage (if any) of Eligible Liabilities which such Lender is required from time to time to maintain as interest bearing Special Deposits with the Bank of England.
 
 
D
is the percentage rate per annum payable by the Bank of England to the Administrative Agent on interest bearing Special Deposits.
 
 
E
is designed to compensate Lenders for amounts payable under the Fees Rules and is calculated by the Administrative Agent as being the average of the most recent rates of charge supplied by the Reference Banks to the Agent pursuant to paragraph 7 below and expressed in Pounds Sterling per £1,000,000;
 
5.           For the purposes of this Schedule:
 
 
(a)
“ Eligible Liabilities ” has the meaning given to it from time to time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank of England.
 
 
(b)
“ Fees Rules ” means the rules on periodic fees contained in the FSA Supervision Manual or such other law or regulation as may be in force from time to time in respect of the payment of fees for the acceptance of deposits.
 
 
(c)
“ Fee Tariffs ” means the fee tariffs specified in the Fees Rules under the activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee required pursuant to the Fees Rules but taking into account any applicable discount rate).
 
 
(d)
“ Special Deposits ” has the meaning given to it from time to time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank of England.
 
 
(e)
“ Tariff Base ” has the meaning given to it in, and will be calculated in accordance with, the Fees Rules.
 
6.
In application of the above formulae, A, B, C and D will be included in the formulae as percentages (i.e. 5 per cent. will be included in the formula as 5 and not as 0.05).  A negative result obtained by subtracting D from B shall be taken as zero.  The resulting figures shall be rounded to four decimal places.
 
7.
If requested by the Administrative Agent, each Reference Bank shall, as soon as practicable after publication by the Financial Services Authority, supply to the Administrative Agent, the rate of charge payable by that Reference Bank to the Financial Services Authority pursuant to the Fees Rules in respect of the relevant financial year of the Financial Services Authority (calculated for this purpose by that Reference Bank as being the average of the Fee Tariffs applicable to that Reference Bank for that financial year) and expressed in Pounds Sterling per £1,000,000 of the Tariff Base of that Reference Bank.
 
 
 
 
8.
Each Lender shall supply any information required by the Administrative Agent for the purpose of calculating its Additional Cost Rate.  In particular, but without limitation, each Lender shall supply the following information on or prior to the date on which it becomes a Lender:
 
(a)             the jurisdiction of its Applicable Lending Office; and
 
(b)             any other information that the Agent may reasonably require for such purpose.
 
Each Lender shall promptly notify the Administrative Agent of any change to the information provided by it pursuant to this paragraph.
 
 

9.
The percentages of each Lender for the purpose of A and C above and the rates of charge of each Reference Bank for the purpose of E above shall be determined by the Administrative Agent based upon the information supplied to it pursuant to paragraphs 7 and 8 above and on the assumption that, unless a Lender notifies the Administrative Agent to the contrary, each Lender’s obligations in relation to cash ratio deposits and Special Deposits are the same as those of a typical bank from its jurisdiction of incorporation with an Applicable Lending Office in the same jurisdiction as its Applicable Lending Office.
 
10.
The Administrative Agent shall have no liability to any person if such determination results in an Additional Cost Rate which over or under compensates any Lender and shall be entitled to assume that the information provided by any Lender or Reference Bank pursuant to paragraphs 3, 7 and 8 above is true and correct in all respects.
 
11.
The Administrative Agent shall distribute the additional amounts received as a result of the MCR to the Lenders on the basis of the Additional Cost Rate for each Lender based on the information provided by each Lender and each Reference Bank pursuant to paragraphs 3, 7 and 8 above.
 
12.
Any determination by the Administrative Agent pursuant to this Schedule II in relation to a formula, the MCR, an Additional Cost Rate or any amount payable to a Lender shall, in the absence of manifest error, be conclusive and binding on all Parties.
 
13.
The Administrative Agent may from time to time, after consultation with the Company and the Lenders, determine and provide notice to the Company and the Lenders of any amendments which are required to be made to this Schedule II in order to comply with any change in law, regulation or any requirements from time to time imposed by the Bank of England, the Financial Services Authority or the European Central Bank (or, in any case, any other authority which replaces all or any of its functions) and any such determination shall, in the absence of manifest error, be conclusive and binding on all parties to the Credit Agreement.
 
 
 
 
SCHEDULE III
 

DESIGNATED BORROWER JURISDICTIONS
 

United Kingdom
 
Belgium
 
 
 
SCHEDULE III

 
EXHIBIT A-1

RATE REQUEST

Citibank, N.A., as Reference Bank
under the Credit Agreement
referred to below
388 Greenwich Street
New York, NY 10013
Attn: [________]

[Date]

Ladies and Gentlemen:

The undersigned, Stanley Black & Decker, Inc., refers to the 364-Day Credit Agreement, dated as of March [12], 2010 (as amended, modified or supplemented from time to time, the “ Credit Agreement ”, the terms defined therein being used herein as therein defined) among the undersigned, The Black & Decker Corporation, certain Lenders parties thereto, and Citibank, N.A., as Administrative Agent for said Lenders and hereby requests notification from you pursuant to Section 2.02(a) thereof of the Eurocurrency Rate which is applicable to the Advance to be made (or converted or continued) on        , 20    in the principal amount of [$____] [€____] [£____] with the Interest Period of      months.
 
 
 
 
Very truly yours,
 
Stanley Black & Decker, Inc.
 
 
       
 
By
   
    Name:   
    Title:   
       
________________________
TO BE COMPLETED AND RETURNED BY
REFERENCE BANK:

The rate requested above,
determined as required by
the Credit Agreement, is      .
 
 
 
CITIBANK, N.A., as Reference Bank
 
 
       
 
By
   
    Authorized Officer  
       
       
 
 
 
 
 
 

EXHIBIT A-2

NOTICE OF BORROWING

Citibank, N.A., as  Administrative Agent
for the Lenders parties
to the Credit Agreement
referred to below
388 Greenwich Street
New York, NY 10013
Attn: [________]

[Date]

Ladies and Gentlemen:

The undersigned, Stanley Black & Decker, Inc., refers to the 364-Day Credit Agreement, dated as of March [12], 2010 (as amended, modified or supplemented from time to time, the “ Credit Agreement ”, the terms defined therein being used herein as therein defined), among the undersigned, The Black & Decker Corporation, certain Designated Borrowers, certain Lenders parties thereto, and Citibank, N.A., as Administrative Agent for said Lenders, and hereby gives you notice, irrevocably, pursuant to Section 2.02 of the Credit Agreement that the undersigned hereby requests a Borrowing on the following terms under the Credit Agreement, and in that connection sets forth below the information relating to such Borrowing (the “ Proposed Borrowing” ) as required by Section 2.02(b) of the Credit Agreement:

(i)     The Borrower is ________________.

(ii)    The Business Day of the Proposed Borrowing is              , 20    .

 
(iii)  The Type of Advances comprising the Proposed Borrowing is [Base Rate] 1 [Eurocurrency Rate].

 
(iv)  The aggregate amount of the Proposed Borrowing is [$] 2 [€] [£] ______ .

 
[(v)] The Initial Interest Period for each Eurocurrency Rate Advance made as part of the Proposed Borrowing is        month[s]].
 
 
 
 
 
 
 
1 not available for any Designated Borrower
2 not available for any Designated Borrower
 
 
 
[(v)  The proceeds of the Proposed Borrowing are to be used to buy or carry Margin Stock, and attached hereto are the certificates required pursuant to Section 3.02(ii) of the Credit Agreement and a duly completed Form U-1 or Form G-3.] 3

The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the date of the Proposed Borrowing:

(A)  the representations and warranties contained in Section 4.01 of the Credit Agreement (other than the Excluded Representation) are correct in all material respects, before and after giving effect to the Proposed Borrowing and to the application of the proceeds therefrom, as though made on and as of such date; and

(B)  no event has occurred and is continuing, or would result from such Proposed Borrowing or from the application of the proceeds therefrom, which constitutes an Event of Default or would constitute an Event of Default but for the requirement that notice be given or time elapse or both.
 
 
 
 
Very truly yours,
 
Stanley Black & Decker, Inc.
 
 
       
 
By
   
    Name:  
    Title:  
 

 

 
3 if applicable
 
 
 
EXHIBIT B
NOTICE OF CONVERSION OR CONTINUATION



[Date]

Citibank, N.A., as Administrative Agent
for the Lenders parties
to the Credit Agreement
referred to below
388 Greenwich Street
New York, NY 10013
Attn: [________]


Ladies and Gentlemen:

The undersigned, Stanley Black & Decker, Inc., refers to the 364-Day Credit Agreement, dated as of March [12], 2010 (as amended, modified or supplemented from time to time, the “ Credit Agreement ”, the terms defined therein being used herein as therein defined), among the undersigned, The Black & Decker Corporation, certain Lenders parties thereto, and Citibank, N.A., as Administrative Agent for said Lenders, and hereby gives you notice, pursuant to Section 2.04(b) of the Credit Agreement that [the undersigned] [NAME OF DESIGNATED BORROWER] hereby elects to [convert][continue] the Borrowing consisting of [Base Rate][Eurocurrency Rate] Advances:

 
(i)  which is in the amount of $          ;

 
(ii)  which, in the case of a Borrowing consisting of Eurocurrency Rate Advances, has an Interest Period of    month(s); 4 and

 
(iii)  which was borrowed (or previously converted or continued) on ________, 20__.
 
 
 
Omit clause (ii) if Committed Borrowing consisted of Base Rate Advances.
 
 

 
Such [conversion][continuation] shall become effective on            , 20_   , at which time such Advances shall be [converted into][continued as] [Base Rate][Eurocurrency Rate] Advances:

 
(i)  which is in the amount of $            ; 5
and

 
(ii)  which has an Interest Period of       month(s) 6 .


 
 
 
 
Very truly yours,
 
Stanley Black & Decker, Inc.
 
 
       
 
By
   
    Name:  
    Title:  
 
 

 
 
2    Omit clause (i) if conversion or continuation is for entire amount of Committed Borrowing.

 
3    Omit clause (ii) if conversion is into Base Rate Advance.
 
 
 
EXHIBIT C
 
 

EXHIBIT D
 
 
 
 
 
 
 
EXHIBIT E
 
 
 
 
 

 
EXHIBIT C-1

FORM OF OPINION OF COUNSEL TO THE COMPANY


March [12], 2010


To each of the Lenders listed on
Schedule I hereto and to
Citibank, N.A., as Administrative Agent
For the Lenders

 
Re:
The $700,000,000 364-Day Credit Agreement among Stanley Black & Decker, Inc., The Black & Decker Corporation, the Lenders party thereto and Citibank, N.A., as Administrative Agent

Ladies and Gentlemen:

           We have acted as special counsel to Stanley Black & Decker, Inc., a Connecticut corporation (the “Borrower”) in connection with the negotiation, execution and delivery of that certain $700,000,000 364-Day Credit Agreement, dated as of the date hereof, by and among the Borrower, The Black & Decker Corporation, the lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent for the Lenders (in such capacity, the “Administrative Agent”) (the “Credit Agreement”).
 
           This opinion is being delivered pursuant to Section 3.01(d) of the Credit Agreement.  Capitalized terms used herein and not expressly defined herein have the definitions specified in the Credit Agreement.
 
           In addition to the Credit Agreement, we have examined originals, certified copies or copies otherwise identified as being true copies of the following:
 
 
(a)
the Restated Certificate of Incorporation of the Borrower, dated September 11, 1998, filed with the Connecticut Secretary of State’s office on September 15, 1998, certified by the Secretary of the Borrower as of the date hereof,
 
 
(b)
the Bylaws of the Borrower as in effect as of the date hereof, as certified by the Secretary of the Borrower as of the date hereof;
 
 
(c)
the resolutions duly adopted at a meeting of the Board of Directors of the Borrower on ___________, ____ authorizing, among other things, the execution, delivery and performance by the Borrower of the Credit Agreement and the transactions contemplated thereby;
 
 
(d)
the Certificate of Legal Existence of the Borrower as of __________, ____ issued by the Connecticut Secretary of State;
 
 
 
 
(e)
the Certificate of the General Counsel of the Borrower, dated as of the date hereof, a copy of which is attached hereto as Exhibit A (the “Borrower’s Certificate”);
 
 
(f)
a copy of the Borrower’s Annual Report on Form 10-K for the year ended January 1, ____ (the “Form 10-K”) filed with the Securities and Exchange Commission;
 
           With your concurrence, the opinions hereafter expressed, whether or not qualified by language such as “to our knowledge”,  are based solely upon (1) our review of the Credit Agreement, (2) inquiry among members of our firm that have given substantive attention to the negotiation of the Credit Agreement, and (3) such review of published sources of law as we have deemed necessary.  This firm, in rendering legal opinions, customarily makes certain assumptions which are described in Schedule A hereto.  In the course of our representation of the Borrower in connection with this transaction, nothing has come to our attention which causes us to believe reliance upon any of those assumptions is inappropriate, and, with your concurrence, the opinions hereafter expressed are based upon those assumptions.  Our opinions hereafter expressed are limited to the laws of the State of New York, the corporate laws of the State of Connecticut and Federal law.

The opinions hereafter expressed with respect to the enforceability of any provisions of the Credit Agreement or any rights or remedies granted to the Lenders or the Administrative Agent under the Credit Agreement, are subject to the general qualifications that such rights and remedies may be subject to and affected by:

(i)           applicable bankruptcy, insolvency, reorganization, receivership, moratorium, or assignment for the benefit of creditors laws and other laws affecting the rights and remedies of creditors generally, including without limitation laws regarding fraudulent transfers, fraudulent conveyances, preferences, avoidance, automatic stay and turn-over;

(ii)           general principles of equity, including without limitation those governing the availability of equitable remedies, affording equitable defenses, requiring good faith, fair dealing and reasonableness in the performance and enforcement of a contract, and affording defenses based upon unconscionability, lack of notice, impracticability or impossibility of performance;

(iii)           general rules of contract law with respect to matters such as the election of remedies, the limits of severability, mutuality of obligations, and opportunity to cure, limitations on the enforceability of indemnification, contribution or exculpation provisions under applicable securities laws or otherwise and limitations on the enforceability of provisions that are in violation of public policy; and

(iv)           determination by the courts in which litigation may be instituted that certain provisions of the Credit Agreement pertaining to the payment of legal expenses, including attorneys’ fees, the waiving of hearings, the designation of federal and state courts as having jurisdiction and/or venue are reasonable and comply with, or are permitted by, applicable constitutional provisions and by applicable laws, regulations and rules of court.

We express no opinion as to the enforceability of any provision in the Credit Agreement which purports to excuse or indemnify the Lenders or the Administrative Agent from any liability for negligent or intentional acts or omissions.  We note that our opinion in paragraph 1 below as to the good standing of the Borrower are limited to the information provided in the certificate of the Secretary of State of the State of Connecticut to the effect that Borrower has legal existence.
 
 

 
We express no opinion concerning any provision in the Credit Agreement which purports to (i) establish evidentiary standards or make determinations conclusive, (ii) waive any rights which may not by law be waived (including the rights to notice and hearing), or (iii) effectuate any provision contained in the Credit Agreement which purports to limit the Lenders’ or the Administrative Agent’s liability.  The provisions of the Credit Agreement regarding the declaration of a default or event of default may be subject to enforcement of a court imposed standard of materiality in determining whether an actionable event of default exists.

Based upon and subject to the foregoing, we are of the opinion that:

           1.           The Borrower is a corporation validly existing and in good standing under the laws of the State of Connecticut.
 
           2.           The execution, delivery and performance by the Borrower of the Credit Agreement and the consummation of the transaction contemplated thereby are within the power and authority of the Borrower and have been duly authorized by all necessary proceedings under the organizational documents of the Borrower, and did not and do not (i) violate or conflict with any provision of the organizational documents of the Borrower, (ii) violate or conflict with any law, rule or regulation of any governmental authority applicable to the Borrower, (iii) require the Borrower to obtain any approval, consent or waiver of, or make any filing with, any governmental agency or body (other than approvals, consents or waivers already obtained or filings already made), (iv) require the consent or authorization of, or approval by, or notice to, any party to any material contract or agreement of which we have knowledge to which the Borrower is a party, except for such consents, authorizations, approvals or notices that (assuming the power and authority of the consenting entity and the authority and capacity of the person signing on its behalf) have been obtained or made, or (v) violate or conflict with any judgment, order or decree of which we have knowledge to which the Borrower is a party or by which any of its assets or properties is bound.
 
           3.           The Credit Agreement has been duly executed and delivered by the Borrower; and the Credit Agreement constitutes the legal, valid and binding obligations of the Borrower, enforceable against it in accordance with its terms.
 
           4.           The Borrower is not an “ investment company ,” or a company “ controlled ” by an “ investment company ,” within the meaning of the Investment Company Act of 1940, as amended.
 
This opinion is rendered to you for your benefit in connection with the transactions contemplated by the Credit Agreement and may not be delivered to, or relied upon by, any other party without our prior written consent.

 

 
 
    Very truly yours,
 
    BROWN RUDNICK LLP
 
 
       
 
 
   
       
       
       


 




SCHEDULE A

BROWN RUDNICK LLP
STANDARD ASSUMPTIONS

In rendering legal opinions in third party transactions, Brown Rudnick LLP makes certain customary assumptions described below:

 
1.
Each natural person executing the Credit Agreement and has sufficient legal capacity to enter into the Credit Agreement and perform the transactions contemplated thereby.

 
2.
Each person other than the Borrower has all requisite power and authority and has taken all necessary corporate or other action to enter into the Credit Agreement, to the extent necessary to make the Credit Agreement enforceable against it.

 
3.
Each person other than the Borrower has complied with all legal requirements pertaining to its status as such status relates to its rights to enforce the Credit Agreement against the Borrower.

 
4.
All documents examined by us in connection with rendering this opinion are accurate, complete and authentic, each original is authentic, each copy conforms to an authentic original and (other than signatures on behalf of the Borrower) all signatures are genuine.

 
5.
All official public records are accurate, complete and properly indexed and filed.

 
6.
There has not been any mutual mistake of fact or misunderstanding, fraud, duress, or undue influence by or among any of the parties to the Credit Agreement.

 
7.
The conduct of the parties to the Credit Agreement has complied in the past and will comply in the future with any requirement of good faith, fair dealing and conscionability.

 
8.
Each person other than the Borrower has acted in good faith and without notice of any defense against the enforcement of any rights created by, or adverse claim to any property or security interest transferred or created as part of, the Transaction.

 
9.
There are no agreements or understandings among the parties to or bound by the Credit Agreement, and there is no usage of trade or course of prior dealing among such parties, that would define, modify, waive, or qualify the terms of the Credit Agreement.

 
10.
The Borrower will not in the future take any discretionary action (including a decision not to act) permitted under the Credit Agreement that would result in a violation of law or constitute a breach or default under the Credit Agreement or court or administrative orders, writs, judgments and decrees that name the Borrower.

 
 

 
 
11.
The Borrower will obtain all permits and governmental approvals not required at the time of the closing of the transactions contemplated by the Credit Agreement but which are subsequently required, and will take all actions similarly required, relevant to subsequent consummation of the transactions or performance of the Credit Agreement.

 
12.
All parties to or bound by the Credit Agreement will act in accordance with, and will refrain from taking any action that is forbidden by, the terms and conditions of the Credit Agreement.


 


BORROWER’S CERTIFICATE

           I, Bruce H. Beatt, am the General Counsel of Stanley Black & Decker, Inc. (the “Borrower”).  I understand that, pursuant to Section 3.01(d) of that certain 364-Day Credit Agreement, dated as of the date hereof (the “Credit Agreement”), among the Borrower, the lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent for the Lenders, Brown Rudnick LLP is relying upon this certificate and the statements made herein in rendering certain legal opinions.  Capitalized terms used herein but not otherwise defined shall have the meaning set forth in the Credit Agreement.
 
           With regard to the foregoing, on behalf of the Borrower, I certify that, as of the date hereof:
 
           1.           Based solely and exclusively on conversations with Craig A. Douglas, Treasurer of the Borrower:
 
           a.           The value of all securities owned by the Borrower (excluding those by majority-owned Subsidiaries of the Borrower) does not exceed ten percent (10%) of the value of the Borrower’s total assets;
 
           b.           Less than twenty-five percent (25%) of the assets of the Borrower on a consolidated basis and on an unconsolidated basis consist of the margin stock (as such term is defined in Regulation U of the Board of Governors of the Federal Reserve System); and
 
           c.           The Borrower is primarily engaged, directly or through a wholly-owned Subsidiary or Subsidiaries, in a business of businesses other than that of investing, reinvesting, owning, holding or trading in securities and is not engaged and does not propose to engage in the business of investing, reinvesting, owning, holding or trading in securities, and does not own or propose to acquire investment securities having a value exceeding forty percent (40%) of the value of the Borrower’s total assets (exclusive of government securities and cash items) on an unconsolidated basis.
 
           2.           Based solely and exclusively on interviews of the officers of the Borrower responsible for its financing activities and the lawyers under my supervision, the execution, delivery and performance by the Borrower of any of its obligations under the Credit Agreement does not and will not require the Borrower to obtain any approval, consent or waiver of, or make any filing with, any governmental agency or body (other than approvals, consents or waivers already obtained or filings already made), require the consent or authorization of, or approval by, or notice to, any party to any material contract or agreement to which the Borrower is a party, except for such consents, authorizations, approvals or notices that (assuming the power and authority of the consenting entity and the authority and capacity of the person signing on its behalf) have been obtained or made, or violate or conflict with any judgment, order or decree to which the Borrower is a party or by which any of its assets or properties is bound.
 
In Witness Whereof, I have executed this certificate as of March [12], 2010.
 
 
 

 
     
       
 
By
   
    Name: Bruce H. Beatt  
    Title:   Vice President, General Counsel and  Secretary  
       
 
 
 

 
EXHIBIT C-2

FORM OF OPINION OF COUNSEL TO THE SUBSIDIARY GUARANTOR


March [12], 2010


To each of the Lenders listed on
Schedule I hereto and to
Citibank, N.A., as Administrative Agent
For the Lenders

 
Re:
The $700,000,000 364-Day Credit Agreement among Stanley Black & Decker, Inc., The Black & Decker Corporation, the Lenders party thereto and Citibank, N.A., as Administrative Agent

[TO COME]
 
 
 
 
EXHIBIT C-3

FORM OF OPINION OF SPECIAL NEW YORK COUNSEL TO
THE ADMINISTRATIVE AGENT


March [12], 2010




To the Initial Lenders party to the Credit
Agreement referred to below and to
Citibank, N.A., as Administrative Agent
 
 
Stanley Black & Decker, Inc.
 
Ladies and Gentlemen:
 
We have acted as counsel to Citibank, N.A., as Administrative Agent (the “ Agent ”), in connection with the 364-Day Credit Agreement, dated as of March [12], 2010 (the “ Credit Agreement ”), among Stanley Black & Decker, Inc., a Connecticut corporation (the “ Company ”), The Black & Decker Corporation, a Maryland corporation (the “ Subsidiary Guarantor ”), and each of you.  Unless otherwise defined herein, terms defined in the Credit Agreement are used herein as therein defined.
 
In that connection, we have reviewed originals or copies of the following documents:
 
(a) A copy of the Credit Agreement executed by each of the Company and the Subsidiary Guarantor and
 
(b) The Notes executed by the Company and delivered on the date hereof.
 
The documents described in the foregoing clauses (a) and (b) are collectively referred to herein as the “Opinion Documents.”
 
We have also reviewed originals or copies of such other agreements and documents as we have deemed necessary as a basis for the opinions expressed below.
 
In our review of the Opinion Documents and other documents, we have assumed:
 
 
A.
The genuineness of all signatures.
 
 
B.
The authenticity of the originals of the documents submitted to us.
 
 
C.
The conformity to authentic originals of any documents submitted to us as copies.
 
 
 
 
D.
As to matters of fact, the truthfulness of the representations made in the Credit Agreement and the other Opinion Documents.
 
 
E.
That each of the Opinion Documents is the legal, valid and binding obligation of each party thereto, other than the Loan Parties, enforceable against each such party in accordance with its terms.
 
 
F.
That:
 
(i)           Each Loan Party is an entity duly organized and validly existing under the laws of the jurisdiction of its organization.
 
(ii)           Each Loan Party has full power to execute, deliver and perform, and has duly executed and delivered, the Opinion Documents to which it is a party.
 
(iii)           The execution, delivery and performance by each Loan Party of the Opinion Documents to which it is a party have been duly authorized by all necessary action (corporate or otherwise) and do not:
 
(1)           contravene its certificate or articles of incorporation, by-laws or other organizational documents;
 
(2)           except with respect to Generally Applicable Law, violate any law, rule or regulation applicable to it; or
 
(3)           result in any conflict with or breach of any agreement or document binding on it of which any addressee hereof has knowledge, has received notice or has reason to know.
 
(iv)           Except with respect to Generally Applicable Law, no authorization, approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or (to the extent the same is required under any agreement or document binding on it of which an addressee hereof has knowledge, has received notice or has reason to know) any other third party is required for the due execution, delivery or performance by any Loan Party of any Opinion Documents to which it is a party or, if any such authorization, approval, action, notice or filing is required, it has been duly obtained, taken, given or made and is in full force and effect.
 
We have not independently established the validity of the foregoing assumptions.
 
“ Generally Applicable Law ” means the federal law of the United States of America, and the law of the State of New York (including the rules or regulations promulgated thereunder or pursuant thereto), that a New York lawyer exercising customary professional diligence would reasonably be expected to recognize as being applicable to the Loan Parties, the Opinion Documents or the transactions governed by the Opinion Documents.  Without limiting the generality of the foregoing definition of Generally Applicable Law, the term “Generally Applicable Law” does not include any law, rule or regulation that is applicable to any Loan Party, the Opinion Documents or such transactions solely because such law, rule or regulation is part of a regulatory regime applicable to any party to any of the Opinion Documents or any of its affiliates due to the specific assets or business of such party or such affiliate.
 
 
 
Based upon the foregoing and upon such other investigation as we have deemed necessary and subject to the qualifications set forth below, we are of the opinion that each Opinion Document is the legal, valid and binding obligation of each Loan Party, enforceable against such Loan Party in accordance with its terms.
 
Our opinion expressed above is subject to the following qualifications:
 
(a)           Our opinion is subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally (including without limitation all laws relating to fraudulent transfers).
 
(b)           Our opinion is subject to the effect of general principles of equity, including without limitation concepts of materiality, reasonableness, good faith and fair dealing (regardless of whether considered in a proceeding in equity or at law).
 
(c)           We express no opinion with respect to the enforceability of indemnification provisions, or of release or exculpation provisions, contained in the Opinion Documents to the extent that enforcement thereof is contrary to public policy regarding the indemnification against or release or exculpation of criminal violations, intentional harm or violations of securities laws.
 
(d)           We express no opinion with respect to the enforceability of any indemnity against loss in converting into a specified currency the proceeds or amount of a court judgment in another currency.
 
(e)           Our opinion is limited to Generally Applicable Law.
 
A copy of this opinion letter may be delivered by any of you to any person that becomes a Lender in accordance with the provisions of the Credit Agreement.  Any such person may rely on the opinions expressed above as if this opinion letter were addressed and delivered to such person on the date hereof.
 
This opinion letter is rendered to you in connection with the transactions contemplated by the Opinion Documents.  This opinion letter may not be relied upon by you or any person entitled to rely on this opinion pursuant to the preceding paragraph for any other purpose without our prior written consent.
 
This opinion letter speaks only as of the date hereof.  We expressly disclaim any responsibility to advise you of any development or circumstance of any kind, including any change of law or fact, that may occur after the date of this opinion letter that might affect the opinions expressed herein.
 
                             Very truly yours,
 
 
 
SLH
 
 
 

EXHIBIT D
ASSIGNMENT AND ACCEPTANCE

Reference is made to the 364-Day Credit Agreement dated as of March [12], 2010 (as amended or modified from time to time, the “ Credit Agreement ”) among Stanley Black & Decker, Inc., a Connecticut corporation (the “ Company ”), The Black & Decker Corporation, the Lenders (as defined in the Credit Agreement) and Citibank, N.A., as Administrative Agent for the Lenders (the “ Administrative Agent ”).  Terms defined in the Credit Agreement are used herein with the same meaning.

The “Assignor” and the “Assignee” referred to on Schedule I hereto agree as follows:

1.  The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes from the Assignor, an interest in and to the Assignor’s rights and obligations under the Credit Agreement as of the date hereof equal to the percentage interest specified on Schedule 1 hereto of all outstanding rights and obligations under the Credit Agreement.  After giving effect to such sale and assignment, the Assignee’s Commitment and the amount of the Advances owing to the Assignee will be as set forth on Schedule 1 hereto.

2.  The Assignor (i) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any other instrument or document furnished pursuant thereto; (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Company or the performance or observance by the Company of any of its obligations under the Credit Agreement or any other instrument or document furnished pursuant thereto; and (iv) attaches the Note held by the Assignor and requests that the Administrative Agent exchange such Note for a new Note payable to the order of the Assignee in an amount equal to the Commitment assumed by the Assignee pursuant hereto or new Notes payable to the order of the Assignee in an amount equal to the Commitment assumed by the Assignee pursuant hereto and the Assignor in an amount equal to the Commitment retained by the Assignor under the Credit Agreement, respectively, as specified on Schedule 1 hereto.

3.  The Assignee (i) confirms that it has received a copy of the Credit Agreement, together with copies of the financial statements referred to in Section 4.01 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (ii) agrees that it will, independently and without reliance upon the Administrative Agent, the Assignor or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Credit Agreement as are delegated to the Administrative Agent by the terms thereof, together with such powers and discretion as are reasonably incidental thereto; (iv) agrees that it will perform in accordance with their terms all of the obligations that by the terms of the Credit Agreement are required to be performed by it as a Lender; (v) agrees, for the benefit of the Company, that it will be bound by the terms and provisions of the Credit Agreement to the same extent as if it were an original party thereto; and (vi) attaches any U.S. Internal Revenue Service forms required under Section 8.09 of the Credit Agreement.
 
 

 
4.  Following the execution of this Assignment and Acceptance, it will be delivered to the Administrative Agent for acceptance and recording by the Administrative Agent.  The effective date for this Assignment and Acceptance (the “ Effective Date ”) shall be the date of acceptance hereof by the Administrative Agent, unless otherwise specified on Schedule 1 hereto.

5.  Upon such acceptance and recording by the Administrative Agent, as of the Effective Date, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement.

6.  Upon such acceptance and recording by the Administrative Agent, from and after the Effective Date, the Administrative Agent shall make all payments under the Credit Agreement and the Notes in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and facility fees with respect thereto) to the Assignee.  The Assignor and Assignee shall make all appropriate adjustments in payments under the Credit Agreement and the Notes for periods prior to the Effective Date directly between themselves.

7.  This Assignment and Acceptance shall be governed by, and construed in accordance with, the law of the State of New York.

8.  This Assignment and Acceptance may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance.

IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to this Assignment and Acceptance to be executed by their officers thereunto duly authorized as of the date specified thereon.
 
 
       
 
By
   
    Name:   
    Title:   
       
 
       
 
By
   
    Name:   
    Title:   
       
 
       
 
By
   
    Name:   
    Title:   
       

 
 
 
Schedule 1
to
Assignment and Acceptance

 
 
Percentage interest assigned:
      %
         
Assignee’s Commitment:
  $    
         
Aggregate outstanding principal amount of
         Advances assigned:
  $    
         
Principal amount of Note
payable to Assignee:
  $    
         
Principal amount of Note
payable to Assignor:
  $  
 
       
Effective Date 7 :
 
_______________,
 20__

 
 
 
 
[NAME OF ASSIGNOR],
  as Assignor
 
 
       
 
By
   
    Name:   
    Title:   
 
  Dated: ____________________, 20___
 
 
 
[NAME OF ASSIGNEE],
  as Assignor
 
 
       
 
By
   
    Name:   
    Title:   
 
  Dated: ____________________, 20___
 
 
 
 
 
 
 
6            This date should be no earlier than five Business Days after the delivery of this As­signment and Acceptance to the Agent.
 


 
 
Domestic Lending Office:
[Address]

Eurocurrency Lending Office:
[Address]
Accepted this ________________ day
of _______________, 20__

Citibank, N.A., as Administrative Agent

By_________________________
  Name:
  Title:


[Approved this ________________ day
of _______________, 20__

Stanley Black & Decker, Inc.


By_________________________
  Name:
  Title:

 

EXHIBIT E

PROMISSORY NOTE

[$][€][£]___________                                              Dated:_______________________




FOR VALUE RECEIVED, the undersigned, [STANLEY BLACK & DECKER, INC., a Connecticut corporation] [DESIGNATED BORROWER, a [________] corporation] (the “ Borrower ”), HEREBY PROMISES TO PAY to the order of [NAME OF LENDER] (the “ Lender ”) the principal sum of [$][€][£]              or, if less, the aggregate principal amount of all Advances made by the Lender to the Borrower pursuant to the Credit Agreement referred to below outstanding on the Termination Date, and such amount shall be paid on or prior to the Termination Date as provided in the Credit Agreement referred to below.

Capitalized terms used herein and not defined herein shall have the meanings provided in the Credit Agreement referred to below.

The Borrower promises to pay interest on the principal amount of each Advance from the date of such Advance until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Credit Agreement referred to below.

Both principal of and interest on each Advance are payable in the Currency in which such Advance was denominated to Citibank, N.A., as Administrative Agent, at the Administrative Agent’s Account in the Principal Financial Center for such Currency for the account of the Lender, in same day funds.  Each Advance made by the Lender to the Borrower and the maturity thereof, and all payments made on account of the principal amount thereof, shall be recorded by the Lender and, prior to any transfer hereof, endorsed on the grid attached hereto which is a part of this Promissory Note, which recordation shall be conclusive and binding absent manifest error but the failure to make such recording shall not have any effect on the Lender’s rights hereunder.

This Promissory Note is one of the Notes referred to in, and is entitled to the benefits of, the 364-Day Credit Agreement dated as of March [12], 2010 (as amended, modified or supplemented from time to time, the “ Credit Agreement ”), among [Stanley Black & Decker, Inc./the Borrower], The Black & Decker Corporation, certain Designated Borrowers (if any), the Lender and certain other lenders parties thereto, and Citibank, N.A., as Administrative Agent for the Lender and such other lenders.  The Credit Agreement, among other things, (i) provides for the making of Advances by the Lender to the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Dollar amount first above mentioned, the indebtedness of the Borrower resulting from each such Advance being evidenced by this Promissory Note, and (ii) contains provisions for acceleration of the maturity hereof upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity hereof upon the terms and conditions therein specified.
 
 
 

 
[STANLEY BLACK & DECKER, INC.]
[DESIGNATED BORROWER]
 
 
       
 
By
   
    Name:   
    Title:   
       
 
 
 
By
   
    Name:   
    Title:   
       
 
 
 
 
 
EXHIBIT F


FORM OF DESIGNATION LETTER

[Date]


To Citibank, N.A.,
as Administrative Agent
388 Greenwich Street
New York, NY 10013

Attention:  [__________]

Ladies and Gentlemen:

We make reference to the $700,000,000 364-Day Credit Agreement dated as of March [12], 2010 (the “ Credit Agreement ”) among Stanley Black & Decker, Inc. (the “ Company ”), The Black & Decker Corporation, certain Designated Borrowers (if any), the Lenders party thereto and Citibank, N.A., as Administrative Agent.  Terms defined in the Credit Agreement are used herein as defined therein.

The Company hereby designates [____________] (the “ Designated Borrower ”), a corporation duly incorporated under the laws of [_____________] and a Subsidiary, as a Company in accordance with Section 2.14 of the Credit Agreement.

The Designated Borrower hereby accepts the above designation and hereby expressly and unconditionally accepts all of the obligations of a Borrower under the Credit Agreement, adheres to the Credit Agreement and agrees and confirms that, upon your execution and return to the Company of the enclosed copy of this letter, it shall be a Borrower for all purposes of the Credit Agreement, joins in each of the waivers, appointments and submissions in Article VIII thereof, and will perform and comply with the terms and provisions of the Credit Agreement applicable to it as if it had originally executed the Credit Agreement as a Borrower.  The Designated Borrower hereby authorizes and empowers the Company to act as its representative and attorney-in-fact for the purposes of signing documents and giving and receiving notices (including notices of Borrowing under the Credit Agreement) and other communications in connection with the Credit Agreement and the transactions contemplated thereby and for the purposes of modifying or amending any provision of the Credit Agreement and further agrees that the Administrative Agent and each Lender may conclusively rely on the foregoing authorization.

The Designated Borrower represents and warrants to the Administrative Agent and each Lender the following:

 
(a)
Corporate Existence .  The Designated Borrower is an entity duly organized and validly existing under the laws of its jurisdiction of formation.
 
 
 
 
(b)
Corporate Authorization, Etc.   The performance of its obligations under the Credit Agreement and the execution, delivery and performance by the Designated Borrower of this Designation Letter and any Note executed by the Designated Borrower are within the Designated Borrower’s corporate powers, have been duly authorized by all necessary corporate action and do not contravene (i) the Designated Borrower’s charter documents of (ii) any law or contractual restriction binding on or affecting the Designated Borrower.
 
 
(c)
No Approvals .  No authorization, approval or action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by the Designated Borrower’s of this Designation Letter and any Note executed by the Designated Borrower or the performance of its obligations under the Credit Agreement.
 
 
(d)
Enforceability .  Each of the Credit Agreement and this Designation Letter is and, upon issuance and delivery thereof in accordance with the Credit Agreement, each Note executed by the Designated Borrower will be the legal, valid and binding obligations of the Designated Borrower, enforceable against the Designated Borrower in accordance with their respective terms.
 
 
(e)
Investment Company .  The Designated Borrower is not an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
 
 
(f)
No Defaults .  The Designated Borrower is not in default under or with respect to any agreement, instrument or undertaking to which it is a party or by which it or any of its property is bound in any respect which could reasonably be expected to result in a Material Adverse Effect.
 
 
(g)
Use of Proceeds, Etc.   All proceeds of each Advance made to the Designated Borrower will be used by it only in accordance with the provisions of Section 2.12 of the Credit Agreement.  It is not, nor will be, engaged in the business of extending credit for the purpose of buying or carrying Margin Stock and no proceeds of any Advance will be used by it to extend credit to others for the purpose of buying or carrying any Margin Stock.  Neither the making of any Advance to the Designated Borrower nor the use of the proceeds thereof will violate or be inconsistent with the provisions of Regulations U or X issued by the Board of Governors of the Federal Reserve System.
 
The Designated Borrower agrees that the address set forth below its name on its signature page hereto shall be its “Address for Notices” for all purposes of the Credit Agreement (including Section 8.13 thereof).  The Designated Borrower acknowledges its receipt of the notice of each Lender, provided pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), set forth in Section 8.15 of the Credit Agreement.
 
 

 
To the extent that the Designated Borrower or any of its Property has or hereafter may acquire, in any jurisdiction in which judicial proceedings may at any time be commenced with respect to the Credit Agreement or any other Loan Document, any immunity from jurisdiction, legal proceedings, attachment (whether before or after judgment), execution, judgment or set-off, the Designated Borrower hereby irrevocably agrees not to claim and hereby irrevocably waives such immunity.
 
 

 
STANLEY BLACK & DECKER, INC.
 
 
       
 
By
   
    Name:   
    Title:   
       
 
 
 
By
   
    Name:   
    Title:   
       
 
 


 
[NAME OF DESIGNATED BORROWER]
 
 
       
 
By
   
    Name:   
    Title:   
       
 

Address for Notices:
[_________________]
[_________________]
[_________________]

Attention:  [____________]
Telecopier:  [____________]
Telephone:  [____________]



ACCEPTED AND AGREED:

CITIBANK, N.A.,
as Administrative Agent


By________________________
Name:
Title:
 
 
 
 
 
EXHIBIT G

 

FORM OF TERMINATION LETTER


[Date]


To Citibank, N.A.,
as Administrative Agent
388 Greenwich Street
New York, NY 10013

Attention:  [__________]

Ladies and Gentlemen:

We make reference to the $700,000,000 364-Day Credit Agreement dated as of March [12], 2010 (the “ Credit Agreement ”) among Stanley Black & Decker, Inc. (the “ Company ”), The Black & Decker Corporation, certain Designated Borrowers (if any), the Lenders party thereto and Citibank, N.A., as Administrative Agent.  Terms defined in the Credit Agreement are used herein as defined therein.

The Company hereby terminates the status as a Designated Borrower of [_________________], a corporation incorporated under the laws of [_______________], in accordance with Section 2.14 of the Credit Agreement, effective as of the date of receipt of this notice by the Administrative Agent.  The undersigned hereby represents and warrants that all principal and interest on any Advance of the above-referenced Designated Borrower and all other amounts payable by such Designated Borrower pursuant to the Credit Agreement have been paid in full on or prior to the date hereof.  Notwithstanding the foregoing, this Termination Letter shall not affect any obligation which by the terms of the Credit Agreement survives termination thereof.
 
 

 
STANLEY BLACK & DECKER, INC.
 
 
       
 
By
   
    Name:   
    Title:   
       
 
 
 
By
   
    Name:   
    Title:   
       
 
 
 
 

G-1
Exhibit 10.5
 
 
 
AMENDMENT NO. 2 TO THE
AMENDED AND RESTATED CREDIT AGREEMENT
 
                                          Dated as of  March 12, 2010
 
AMENDMENT NO. 2 TO THE AMENDED AND RESTATED CREDIT AGREEMENT among STANLEY BLACK & DECKER, INC. (formerly known as The Stanley Works), a Connecticut corporation (the “ Borrower ”), the Lenders executing this Amendment on the signature pages hereto and Citibank, N.A., as agent (the “ Agent ”) for the Lenders.
 
PRELIMINARY STATEMENTS:
 
(1)           The Borrower, the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the “ Lenders ”) and the Agent have entered into an Amended and Restated Credit Agreement dated as of February 27, 2008, and Amendment No. 1 thereto dated as of February 17, 2009 (such Credit Agreement, as so amended, the “ Credit Agreement ”).  Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement.
 
(2)           The Borrower and the Required Lenders have agreed to further amend the Credit Agreement as hereinafter set forth.
 
SECTION 1.     Amendments to Credit Agreement .  The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows:
 
(a)           The definitions of “ Applicable Facility Fee Rate ”, “ Base Rate ”, “ EBITDA ”, “ Interest Coverage Ratio ” and “ Interest Expense ” in Section 1.01 are amended in full to read as follows:
 
“ Applicable Facility Fee Rate ” means, on any date, a rate per annum equal to (i) 0.150% if on such date the Company’s outstanding Long-Term Indebtedness is rated A+ or higher by Standard & Poor’s, A1 or higher by Moody’s, or A+ or higher by Fitch, (ii) 0.200% if on such date clause (i) is inapplicable and the Company’s outstanding Long-Term Indebtedness is rated A or higher by Standard & Poor’s, A2 or higher by Moody’s, or A or higher by Fitch, (iii) 0.250% if on such date clauses (i) and (ii) are inapplicable and the Company’s outstanding Long-Term Indebtedness is rated A- or higher by Standard & Poor’s, A3 or higher by Moody’s, or A- or higher by Fitch, (iv) 0.300% if on such date clauses (i), (ii) and (iii) are inapplicable and the Company’s outstanding Long-Term Indebtedness is rated BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and (v) 0.375% if on such date clauses (i), (ii), (iii) and (iv) are inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency); provided   that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Applicable Facility Fee Rate” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
 
 
“ Base Rate ” means a fluctuating interest rate per annum as shall be in effect from time to time, which rate per annum shall at all times be equal to the highest of:
 
(a)  the rate of interest announced publicly by the Reference Bank in New York, New York, from time to time, as its base rate;
 
(b)  1/2 of one percent per annum above the Federal Funds Rate; and
 
(c)  the rate equal to the Eurocurrency Rate for a Dollar denominated Advance having an Interest Period of one month determined for each day that a Base Rate Loan is outstanding (and in respect of any day that is not a Banking Day, such rate as in effect on the immediately preceding Banking Day) plus 1.00% per annum.
 
“ EBITDA ” means, for any period, the sum (without duplication) for the Company and its Consolidated Subsidiaries on a consolidated basis of the following: (a) net income for such period plus (b) to the extent deducted in determining net income for such period, the sum of (i) depreciation and amortization for such period, (ii) Interest Expense for such period and (iii) taxes for such period.  Notwithstanding the foregoing, (1) in calculating EBITDA for any period that includes one or more Restructuring Periods, EBITDA shall be increased by an amount equal to the Applicable Restructuring Charges for any such Restructuring Periods, (2) in calculating EBITDA for any period, any impairment charges or asset write-offs, in each case pursuant to Financial Accounting Standards Board’s Staff Position Accounting Principles Board Opinion No. 144 (“Accounting for the Impairment or Disposal of Long-Lived Assets (Issued 8/01)”), shall be excluded, (3) in calculating EBITDA for any period, non-cash charges arising from purchase accounting adjustments (including the effects of such adjustments pushed down to such Person and its Subsidiaries) in component amounts required or permitted by GAAP, resulting from the write-up of assets or application of purchase accounting in relation to any consummated acquisition or the amortization, depreciation, or write-off of any amounts thereof, net of taxes, shall be excluded, and (4) in calculating EBITDA for any period, charges associated with stock-based compensation shall be excluded.  For the purpose of calculating EBITDA for any period following the acquisition of The Black & Decker Corporation, EBITDA for such period shall be calculated after giving pro forma effect to such acquisition as if such acquisition occurred on the first day of such period.
 
“ Interest Coverage Ratio ” means, for any period of four consecutive fiscal quarters, the ratio of (a) EBITDA for such period to (b) Interest Expense for such period.
 
“ Interest Expense ” means, for any period, the sum (determined without duplication) of the aggregate amount of interest reported in respect of such period on the Indebtedness of the Company and its Consolidated Subsidiaries on a consolidated basis, including, without limitation, the interest portion of payments under Capital Lease obligations and any capitalized interest but excluding imputed (non-cash) interest expense in respect of convertible bonds issued by the Company or any of its Consolidated Subsidiaries as calculated in accordance with the Financial Accounting Standards Board’s Staff Position Accounting Principles Board Opinion No. 14-1 (“Accounting for Convertible Debt Instruments That May be Settled in Cash upon Conversion (Including Partial Cash Settlement)”), minus (i) interest income of the Company and its Consolidated Subsidiaries on a consolidated basis reported in respect of such period, (ii) interest on deferred compensation reported in respect of such period, and (iii) any income/expense in respect of such period associated with spot-to-forward differences or points on foreign currency trades that are included in interest income/expense as a result of Statement of Financial Accounting Standards No. 133, as amended and interpreted.  For the purpose of calculating Interest Expense for any period following the acquisition of The Black & Decker Corporation, Interest Expense for such period shall be calculated after giving pro forma effect to such acquisition as if such acquisition occurred on the first day of such period.
 
 
2
 
                (b)           The definition of “Applicable Eurocurrency Margin” in Section 1.01 is amended by (i) deleting the figure “0.75%” and replacing it with “the Floor” in both places such figure appears and (i) deleting the figure “2.50%” and replacing it with “the Cap” in the three places such figure appears.
 
(c)           Section 1.01 is further amended by adding the following definitions in the appropriate alphabetical order:
 
“ Applicable Base Rate Margin ” means, on any day, a rate per annum equal to the higher of (a) the Applicable Eurocurrency Margin for such day minus 1.00% and (b) 0.00%.
 
“ Applicable Restructuring Charge ” means
 
           (a)           for any Restructuring Period falling in the Company’s fiscal year 2009, the restructuring charges reported in the Company’s SEC Filings for such fiscal quarter; provided that the sum of the Applicable Restructuring Charges for all of the Restructuring Periods in the Company’s fiscal year 2009 will not exceed $50,000,000 in the aggregate; and

           (b)           for any Restructuring Period falling in the Company’s fiscal year 2010, 2011, 2012, or 2013, amounts relating to one or more of the following: (i) restructuring charges, including, without limitation, the effect of reconstruction, recommissioning or reconfiguration of fixed assets for alternative uses, store closure, office closure, plant closure, facility consolidations, downsizing, shutdown costs (including future lease commitments and contract termination costs with respect thereto), curtailments or modifications to pension and post-retirement employee benefit plans, retention, severance, system establishment costs, and acquisition integration costs; (ii) change of control payments and transaction fees; (iii) performance-based bonus payments to Nolan Archibald; (iv) all expenses and charges related to any stock based compensation; (v) non-cash inventory step-up charges; and (vi) liabilities under Section 280G of the Internal Revenue Code and gross-ups related thereto; provided that the sum of the Applicable Restructuring Charges for all of the Restructuring Periods in the Company’s fiscal years 2010, 2011, 2012, and 2013 will not exceed $1,200,000,000 in the aggregate, of which not more than $900,000,000 is cash.
 
 
3
 
“ Cap ” means, on any date, a rate per annum equal to (i) 2.500% if on such date the Company’s outstanding Long-Term Indebtedness is rated BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and (ii) 3.000% if on such date clause (i) is inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency); provided   that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Cap” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
“ Floor ” means, on any date, a rate per annum equal to (i) 0.750% if on such date the Company’s outstanding Long-Term Indebtedness is rated A- or higher by Standard & Poor’s, A3 or higher by Moody’s, or A- or higher by Fitch, (ii) 1.000% if on such date clause (i) is inapplicable and the Company’s outstanding Long-Term Indebtedness is rated BBB+ or higher by Standard & Poor’s, Baa1 or higher by Moody’s, or BBB+ or higher by Fitch, and (iii) 1.500% if on such date clauses (i) and (ii) are inapplicable (including if such Long-Term Indebtedness is no longer rated by any agency); provided   that if the respective levels of the Company’s outstanding Long-Term Indebtedness credit ratings differ, the “Floor” will be determined based on, (a) if two of the ratings are at the same level and the other rating is higher or lower than those same ratings, the level corresponding to the two same ratings shall apply and (b) if each of the three ratings falls within different levels, then the level corresponding to the rating that is in between the highest and the lowest ratings shall apply.
 
“ Loan Parties ” means, collectively, the Borrowers and the Subsidiary Guarantor.
 
           “ Restructuring Period ” means (a) if the Company reports taking any restructuring charges during any quarter of its fiscal year 2009 in the Company’s Exchange Act disclosure documents filed with the Securities and Exchange Commission on Forms 8K, 10K or 10Q (or their equivalents) (the Company’s “ SEC Filings ”), each such fiscal quarter of the Company during its fiscal year 2009, and (b) each fiscal quarter of the Company during fiscal years 2010, 2011, 2012, and 2013.
 
“ SEC Filings ” has the meaning provided in the definition of “ Restructuring Period”.
 
“ Subsidiary Guarantor ” means The Black & Decker Corporation, a Maryland corporation.
 
 
4
 
“ Subsidiary Guaranty ” means the guaranty of the Subsidiary Guarantor, in form and substance reasonably satisfactory to the Administrative Agent, delivered to the Administrative Agent on or about the date that the Company acquires the Subsidiary Guarantor.
 
(d)          Section 2.05(a) is amended by inserting immediately after the phrase “Base Rate in effect from time to time” the phrase “plus the Applicable Base Rate Margin”.
 
(e)           Section 3.02(i)(x) is amended by inserting immediately after the parenthetical phrase “(other than the Excluded Representation”) the phrase “and in Section 7 of the Subsidiary Guaranty”.
 
(f)           Section 5.02(a)(ix) is amended in full to read as follows:
 
(ix)  Liens on (A) any property existing at the time of acquisition but only if the amount of outstanding Indebtedness secured thereby does not exceed the lesser of the fair market value or the purchase price of the property so purchased and (B) any property of The Black & Decker Corporation existing at the time of acquisition;
 
(g)          Section 6.01(b) is amended by deleting the word “Borrower” and replacing it with “Loan Party” in both places such word appears.
 
(h)          Section 6.01(g) is amended by deleting the figure “$25,000,000” and replacing it with “$75,000,000” in both places such figure appears.
 
(i)           Section 6.01(h) is amended by restating clause (B) thereof in full to read as follows:
 
(B) any Plan shall have an unfunded liability, which means the excess, if any, of a Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Plan’s assets, determined in accordance with the assumptions used for funding that Plan pursuant to Section 412 of the Internal Revenue Code for the applicable plan year
 
(j)           Section 6.01(i) is amended by deleting the figure “$25,000,000” and replacing it with “$75,000,000”.
 
(k)          Section 8.02(a) is amended by deleting the word “ Borrower ” and replacing it with “ Loan Party ” .
 
(l)           Section 8.07(b) is amended by deleting the word “Borrower ” and replacing it with “Loan Party ” in both places such word appears.
 
(m)         Section 8.08(a) is amended by deleting the word “Borrower ”  and replacing it with “Loan Party ” in each place such word appears.
 
SECTION 2.             Conditions of Effectiveness .  This Amendment shall become effective as of the time of the delivery of all evidence referenced in clause (f) below on the date (the “ Amendment Effective Date ”), which shall be on or before June 30, 2010, as of which the Administrative Agent shall confirm to the Company that it has received the following, each dated such day, in form and substance satisfactory to the Administrative Agent:
 
(a)            Executed Counterparts .  Counterparts of this Amendment executed by the Company and the Lenders party to the Credit Agreement constituting the Required Lenders;
 
 
5
 
(b)            Subsidiary Guaranty .  The Subsidiary Guaranty, in substantially the form of Exhibit A to this Amendment, duly executed and delivered by the Subsidiary Guarantor;
 
(c)            Authority and Approvals .  Certified copies of the resolutions of the Board of Directors of the Subsidiary Guarantor (or equivalent documents) authorizing and approving the Subsidiary Guaranty and the transactions contemplated thereby and certified copies of all documents evidencing all necessary corporate action and all other necessary action (corporate, partnership or otherwise) and governmental approvals, if any, with respect to the Subsidiary Guaranty;
 
(d)            Secretary’s or Assistant Secretary’s Certificate .  A certificate of the Secretary or an Assistant Secretary of the Subsidiary Guarantor, dated the Amendment Effective Date, certifying the names and true signatures of the officers of the Subsidiary Guarantor authorized to execute and deliver the Subsidiary Guaranty;
 
(e)            Legal Opinions .  An opinion of counsel to the Subsidiary Guarantor, dated the Amendment Effective Date;
 
(f)            Acquisition of The Black & Decker Corporation .  Evidence satisfactory to the Administrative Agent that Blue Jay Acquisition Corp. shall have consummated the merger with The Black & Decker Corporation that is contemplated by that certain Agreement and Plan of Merger dated as of November 2, 2009 by and among the Company, Blue Jay Acquisition Corp., and The Black & Decker Corporation , together with evidence that the commitments under the Five-Year Credit Agreement dated as of December 7, 2007 among The Black & Decker Corporation, Black & Decker Luxembourg Finance S.C.A. and Black & Decker Luxembourg S.aR.L., as borrowers, certain lenders parties thereto and Citibank, N.A., as administrative agent for said lenders (the “B&D Facility”) have been or concurrently with the Effective Date are being terminated and all amounts payable under the B&D Facility have been paid; and
 
(g)            Fees and Expenses .  Payment by the Company in full of the costs, expenses and fees as set forth in Section 8.04(a) of the Credit Agreement.
 
SECTION 3.             Representations and Warranties .  The Company represents and warrants to the Lenders and the Administrative Agent, as to itself and each of its Subsidiaries, that (a) the representations and warranties set forth in Article IV of the Credit Agreement and in each of the other Loan Documents that have been entered into by the Company or any of the Designated Borrowers are true and correct in all material respects on the date hereof as if made on and as of the date hereof (or, if any such representation or warranty is expressly stated to have been made as of a specific date, such representation and warranty shall be true and correct in all material respects as of such specific date) and as if each reference in said Article IV to “this Agreement” included reference to this Amendment; provided that (x) in Sections 4.01(f) and 4.01(h) of the Credit Agreement, the reference to the Company’s Annual Report on Form 10-K for the year ended December 29, 2007 shall be deemed to be a reference to the Company’s Annual Report on Form 10-K for the fiscal year ended January 2, 2010, each of the Company’s reports on Form 8-K and 10-Q during the period from January 2, 2010 through and including the date of this Amendment and the Subsidiary Guarantor ’ s Annual Report on Form 10-K for the year ended December 31, 2009 and (y) in Section 4.01(g) of the Credit Agreement, the reference to December 29, 2007 shall be deemed to be a reference to January 2, 2010 and (b) no Default or Event of Default has occurred and is continuing.
 
 
6
 
SECTION 4.             Reference to and Effect on the Loan Documents .  (a)  On and after the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit Agreement, and each reference in the Notes and each of the other Loan Documents to “the Credit Agreement”, “thereunder”, “thereof” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment.
 
(b)           The Credit Agreement, the Notes and each of the other Loan Documents, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.
 
(c)           The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents.
 
SECTION 5.             Costs and Expenses .  The Borrower agrees to pay on demand all costs and expenses of the Agent in connection with the preparation, execution, delivery, administration, modification and amendment of this Amendment and the other instruments and documents to be delivered hereunder (including, without limitation, the reasonable fees and expenses of counsel for the Agent) in accordance with the terms of Section 8.04 of the Credit Agreement.
 
SECTION 6.             Execution in Counterparts .  This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement.  Delivery of an executed counterpart of a signature page to this Amendment by telecopier or other electronic communication shall be effective as delivery of a manually executed counterpart of this Amendment.
 
SECTION 7.            Governing Law .  This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York.
 
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written.
 
STANLEY BLACK & DECKER, INC. (formerly
known as The Stanley Works)
 
By
/s/ Craig A. Douglas 
 
Name:  Craig A. Douglas
 
Title:    VP & Treasurer
 
 
CITIBANK, N.A.,
as Agent and as Lender
 
By
/s/ Carolyn Kee 
 
Name:  Carolyn Kee 
 
Title:    Vice President


BANK OF AMERICA  
 
 
By
/s/ Jeffrey J. McLaughlin 
 
Name:  Jeffrey J. McLaughlin
 
Title:    SVP

 
CITIBANK, N.A.,
as Agent and as Lender
 
By
/s/ Carolyn Kee 
 
Name:  Carolyn Kee 
 
Title:    Vice President

 
 
7
 
 
 

BANK OF AMERICA  
 
 
By
/s/ Jeffrey M. McLaughlin 
 
Name:  Jeffrey M. McLaughlin
 
Title:    SVP

 
J.P. MORGAN CHASE BANK N.A.  
 
 
By
 /s/ Anthony W. White 
 
Name:  Anthony W. White
 
Title:    Vice President
 
 

BARCLAYS BANK PLC  
 
 
By
/s/ Kevin Cullen 
 
Name:  Kevin Cullen
 
Title:    Director
 
 

BNP PARIBAS  
 
 
By
/s/ Curt Price 
 
Name:  Curt Price
 
Title:    Managing Director
   
By  /s/ Fik Durmus 
  Name:  Fik Durmus 
  Title:    Director 
 
 

WILLIAM STREET LLC  
 
 
By
/s/ Mark Walton 
 
Name:  Mark Walton
 
Title:    Authorized Signatory
 
 
 
 
 
 
 
8
 

 
UBS LOAN FINANCE LLC  
 
 
By
/s/ Irja R. Otsa 
 
Name:  Irja R. Otsa
 
Title:    Associate Director
   
By  /s/ Mary E. Evans 
  Name:  Mary E. Evans 
  Title:    Associate Director 
 
 

WELLS FARGO BANK, N.A.  
 
 
By
/s/ Jordon Fragiacomo 
 
Name:  Jordon Fragiacomo
 
Title:    Director
 
 

THE BANK OF NEW YORK MELLON  
 
 
By
/s/ Donald G. Cassidy, Jr. 
 
Name:  Donald G. Cassidy, Jr.
 
Title:    Managing Director
 
 

HSBC BANK USA, NATIONAL ASSOCIATION  
 
 
By
/s/ Manuel Burge ñ o 
 
Name:  Manuel Burge ñ o
 
Title:    Vice President, Relationship Manager
 
 

MORGAN STANLEY BANK, N.A.  
 
 
By
/s/ Melissa James 
 
Name:  Melissa James 
 
Title:    Authorized Signatory
 
 

ROYAL BANK OF CANADA  
 
 
By
/s/ Dustin Craven 
 
Name:  Dustin Craven 
 
Title:    Authorized Signatory
 
 

 
THE NORTHERN TRUST COMPANY  
 
 
By
/s/ Peter Ja. Hallan 
 
Name:  Peter J. Hallan
 
Title:    Vice President
 
 
 
9
 
 
 
 
Exhibit 10.6

 
THE BLACK & DECKER 1996 STOCK OPTION PLAN
 
 
The proper execution of the duties and responsibilities of the executive and other key employees of The Black & Decker Corporation and its subsidiaries is a vital factor in the continued growth and success of the Corporation. Toward this end, it is necessary to attract and retain effective and capable employees to assume positions that contribute materially to the successful operation of the business of the Corporation. It will benefit the Corporation, therefore, to bind the interests of these persons more closely to its own interests by offering them an attractive opportunity to acquire a proprietary interest in the Corporation and thereby provide them with added incentive to remain in its employ and to increase the prosperity, growth, and earnings of the Corporation. This stock option plan will serve these purposes.

ARTICLE 1:00
 
Definitions

The following terms whenever used herein shall have the meanings set forth below.

1:01
The term “Board of Directors” shall mean the Board of Directors of the Corporation.
1:02
The term “Change in Control” shall have the meaning provided in Section 10:02 of the Plan.
1:03
The term “Code” shall mean the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder.
1:04
The term “Committee” shall mean a committee to be appointed by the Board of Directors to consist of three or more of those members of the Board of Directors who are disinterested persons within the meaning of Rule 16b-3 promulgated under the Exchange Act and are outside directors within the meaning of the Section 162(m) Regulations, as each may be amended from time to time.
1:05
The term “Common Stock” shall mean the shares of common stock, par value $.50 per share, of the Corporation.
1:06
The term “Corporation” shall mean The Black & Decker Corporation.
1:07
The term “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
1:08
The term “Fair Market Value of a share of Common Stock” shall mean the average of the high and low sale price per share of Common Stock as finally reported in the New York Stock Exchange Composite Transactions for the New York Stock Exchange, or if shares of Common Stock are not sold on such date, the average of the high and low sale price per share of Common Stock as finally reported in the New York Stock Exchange Composite Transactions for the New York Stock Exchange for the most recent prior date on which shares of Common Stock were sold.
1:09
The term “Incentive Stock Option” shall mean any Option granted pursuant to the Plan that is designated as an Incentive Stock Option and which satisfies the requirements of Section 422(b) of the Code.
1:10
The term “Limited Stock Appreciation Right” shall mean a limited tandem stock appreciation right that entitles the holder to receive cash upon a Change in Control pursuant to Article 10:00 of the Plan.
1:11
The term “Nonqualified Stock Option” shall mean any Option granted pursuant to the Plan that is not an Incentive Stock Option.
1:12
The term “Option” or “Stock Option” shall mean a right granted pursuant to the Plan to purchase shares of Common Stock, and shall include the terms Incentive Stock Option and Nonqualified Stock Option.
1:13
The term “Option Agreement” shall mean the written agreement representing Options granted pursuant to the Plan as contemplated by Article 6:00 of the Plan.
 
 
 
 
1:14
The term “Plan” shall mean The Black & Decker 1996 Stock Option Plan as approved by the Board of Directors on February 14, 1996, and adopted by the stockholders of the Corporation at the 1996 Annual Meeting of Stockholders, as the same may be amended from time to time.
1:15
The term “Rights” shall include Stock Appreciation Rights and Limited Stock Appreciation Rights.
1:16
The term “Section 162(m) Regulations” shall mean the regulations adopted pursuant to Section 162(m) of the Code.
1:17
The term “Stock Appreciation Right” shall mean a right to receive cash or shares of Common Stock pursuant to Article 8:00 of the Plan.
1:18
The term “Stock Appreciation Right Agreement” shall mean the written agreement representing Stock Appreciation Rights granted pursuant to the Plan as contemplated by Article 8:00 of the Plan.
1:19
The term “Stock Appreciation Right Base Price” shall mean the base price for determining the value of a Stock Appreciation Right under Section 8:02, which Stock Appreciation Right Base Price shall be established by the Committee at the time of the grant of Stock Appreciation Rights pursuant to the Plan and shall not be less than the Fair Market Value of a share of Common Stock on the date of grant. If the Committee does not establish a specific Stock Appreciation Right Base Price at the time of grant, the Stock Appreciation Right Base Price shall be equal to the Fair Market Value of a share of Common Stock on the date of grant of the Stock Appreciation Right.
1:20
The term “subsidiary” or “subsidiaries” shall mean a corporation of which capital stock possessing 50% or more of the total combined voting power of all classes of its capital stock entitled to vote generally in the election of directors is owned in the aggregate by the Corporation directly or indirectly through one or more subsidiaries.

ARTICLE 2:00
 
Effective Date of the Plan

2:01
The Plan shall become effective upon stockholder approval, provided that such approval is received on or before May 31, 1996, and provided further that the Committee may grant Options or Rights pursuant to the Plan prior to stockholder approval if such Options or Rights by their terms are contingent upon subsequent stockholder approval of the Plan.

ARTICLE 3:00
 
Administration

3:01
The Plan shall be administered by the Committee.
3:02
The Committee may establish, from time to time and at any time, subject to the limitations of the Plan as set forth herein, such rules and regulations and amendments and supplements thereto, as it deems necessary to comply with applicable law and regulation and for the proper administration of the Plan. A majority of the members of the Committee shall constitute a quorum. The vote of a majority of a quorum shall constitute action by the Committee.
3:03
The Committee shall from time to time determine the names of those executives and other key employees who, in its opinion, should receive Options or Rights, and shall determine the numbers of shares on which Options should be granted or upon which Rights should be based to each such person and the nature of the Options or Rights to be granted.
3:04
Options and Rights shall be granted by the Corporation only upon the prior approval of the Committee and upon the execution of an Option Agreement or Stock Appreciation Right Agreement between the Corporation and the Option holder or the Stock Appreciation Right holder.
3:05
The Committee’s interpretation and construction of the provisions of the Plan and the rules and regulations adopted by the Committee shall be final. No member of the Committee or the Board of Directors shall be liable for any action taken or determination made, in respect of the Plan, in good faith.
 
 
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ARTICLE 4:00
 
Participation in the Plan

4:01
Participation in the Plan shall be limited to such executives and other key employees of the Corporation and its subsidiaries who at the date of grant of an Option or Right are regular, full-time employees of the Corporation or any of its subsidiaries and who shall be designated by the Committee.
4:02
No member of the Board of Directors who is not also an employee shall be eligible to participate in the Plan. No employee who owns beneficially more than 10% of the total combined voting power of all classes of stock of the Corporation shall be eligible to participate in the Plan.
4:03
No employee may be granted, in any calendar year, Options or Stock Appreciation Rights exceeding 100,000 in the aggregate.

ARTICLE 5:00
 
Stock Subject to the Plan

5:01
There shall be reserved for the granting of Options or Stock Appreciation Rights pursuant to the Plan and for issuance and sale pursuant to such Options or Stock Appreciation Rights 2,400,000 shares of Common Stock. To determine the number of shares of Common Stock available at any time for the granting of Options or Stock Appreciation Rights, there shall be deducted from the total number of reserved shares of Common Stock, the number of shares of Common Stock in respect of which Options have been granted pursuant to the Plan that are still outstanding or have been exercised. The shares of Common Stock to be issued upon the exercise of Options or Stock Appreciation Rights granted pursuant to the Plan shall be made available from the authorized and unissued shares of Common Stock. If for any reason shares of Common Stock as to which an Option has been granted cease to be subject to purchase thereunder, then such shares of Common Stock again shall be available for issuance pursuant to the exercise of Options or Stock Appreciation Rights pursuant to the Plan. Except as provided in Section 5:03, however, the aggregate number of shares of Common Stock that may be issued upon the exercise of Options and Stock Appreciation Rights pursuant to the Plan shall not exceed 2,400,000 shares and no more than 2,400,000 Stock Appreciation Rights shall be granted pursuant to the Plan.
5:02
Proceeds from the purchase of shares of Common Stock upon the exercise of Options granted pursuant to the Plan shall be used for the general business purposes of the Corporation.
5:03
Subject to the provisions of Section 10:02, in the event of reorganization, recapitalization, stock split, stock dividend, combination of shares of Common Stock, merger, consolidation, share exchange, acquisition of property or stock, or any change in the capital structure of the Corporation, the Committee shall make such adjustments as may be appropriate in the number and kind of shares reserved for purchase by executives or other key employees, in the number, kind and price of shares covered by Options and Stock Appreciation Rights granted pursuant to the Plan but not then exercised, and in the number of Rights, if any, granted pursuant to the Plan but not then exercised.

ARTICLE 6:00
 
Terms and Conditions of Options

6:01
Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such form and with such terms and conditions (including, without limitation, noncompete, confidentiality or other similar provisions) as the Committee from time to time may determine. The right of an Option holder to exercise his or her Option shall at all times be subject to the terms and conditions set forth in the respective Option Agreement.
6:02
The exercise price per share for Options shall be established by the Committee at the time of the grant of Options pursuant to the Plan and shall not be less than the Fair Market Value of a share of Common Stock on the date on which the Option is granted. If the Committee does not establish a specific exercise price per share at the time of grant, the exercise price per share shall be equal to the Fair Market Value of a share of Common Stock on the date of grant of the Options.
 
 
- 3 -
 
 
6:03
Each Option, subject to the other limitations set forth in the Plan, may extend for a period of up to 10 years from the date on which it is granted. The term of each Option shall be determined by the Committee at the time of grant of the Option, provided that if no term is established by the Committee the term of the Option shall be 10 years from the date on which it is granted.
6:04
Unless otherwise provided by the Committee, the number of shares of Common Stock subject to each Option shall be divided into four installments of 25% each. The first installment shall be exercisable 12 months after the date the Option was granted, and each succeeding installment shall be exercisable 12 months after the date the immediately preceding installment became exercisable. If an Option holder does not purchase the full number of shares of Common Stock that he or she at any time has become entitled to purchase, he or she may purchase all or any part of those shares of Common Stock at any subsequent time during the term of the Option.
6:05
Options shall be nontransferable and nonassignable, except that Options may be transferred by testamentary instrument or by the laws of descent and distribution.
6:06
Upon voluntary or involuntary termination of an Option holder’s employment, his or her Option and all rights thereunder shall terminate effective at the close of business on the date the Option holder ceases to be a regular, full-time employee of the Corporation or any of its subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections 6:07, 6:08, and 6:09, and (iii) in the case of involuntary termination of employment, for a period of 30 days thereafter the Option holder shall be entitled to exercise that portion of the Option which was exercisable at the close of business on the date the Option holder ceased to be a regular, full-time employee of the Corporation or any of its subsidiaries.
6:07
In the event an Option holder (i) ceases to be an executive or other key employee of the Corporation or any of its subsidiaries due to involuntary termination, (ii) takes a leave of absence from the Corporation or any of its subsidiaries for personal reasons or as a result of entry into the armed forces of the United States, or any of the departments or agencies of the United States government, or (iii) terminates employment by reason of illness, disability, or other special circumstance, the Committee may consider his or her case and may take such action in respect of the related Option Agreement as it may deem appropriate under the circumstances, including accelerating the time previously granted Options may be exercised and extending the time following the Option holder’s termination of employment during which the Option holder is entitled to purchase the shares of Common Stock subject to such Options, provided that in no event may any Option be exercised after the expiration of the term of the Option.
6:08
If an Option holder dies during the term of his or her Option without having fully exercised the Option, the executor or administrator of his or her estate or the person who inherits the right to exercise the Option by bequest or inheritance shall have the right within three years of the Option holder’s death to purchase the number of shares of Common Stock that the deceased Option holder was entitled to purchase at the date of death, after which the Option shall lapse, provided that in no event may any Option be exercised after the expiration of the term of the Option.
6:09
If an Option holder’s employment is terminated without having fully exercised his or her Option and (i) the Option holder is 62 years of age or older, or (ii) the Option holder has been employed by the Corporation or any of its subsidiaries for at least 10 years and the Option holder’s age plus years of such employment total not less than 55 years, then such Option holder shall have the right within three years of the Option holder’s termination of employment to purchase the number of shares of Common Stock that the Option holder was entitled to purchase at the date of termination, after which the Option shall lapse, provided that in no event may any Option be exercised after the expiration of the term of the Option.
 
 
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6:10
The granting of an Option pursuant to the Plan shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Corporation or any of its subsidiaries to employ the Option holder for any specified period.
6:11
In addition to the general terms and conditions set forth in this Article 6:00 in respect of Options granted pursuant to the Plan, Incentive Stock Options granted pursuant to the Plan shall be subject to the following additional terms and conditions:
 
(a)
The aggregate fair market value (determined at the time the Incentive Stock Option is granted) of the shares of Common Stock in respect of which “incentive stock options” are exercisable for the first time by the Option holder during any calendar year (under all such plans of the Corporation and its subsidiaries) shall not exceed $100,000; and
 
(b)
The Option Agreement in respect of an Incentive Stock Option may contain any other terms and conditions specified by the Board of Directors that are not inconsistent with the Plan, except that such terms and conditions must be consistent with the requirements for “incentive stock options” under Section 422 of the Code.

ARTICLE 7:00
 
Methods of Exercise of Options

7:01
An Option holder (or other person or persons, if any, entitled to exercise an Option hereunder) desiring to exercise an Option granted pursuant to the Plan as to all or part of the shares of Common Stock covered by the Option shall (i) notify the Corporation in writing at its principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect, specifying the number of shares of Common Stock to be purchased and the method of payment therefor, and (ii) make payment or provision for payment for the shares of Common Stock so purchased in accordance with this Article 7:00. Such written notice may be given by means of a facsimile transmission. If a facsimile transmission is used, the Option holder should mail the original executed copy of the written notice to the Corporation promptly thereafter.
7:02
Payment or provision for payment shall be made as follows:
 
(a)
The Option holder shall deliver to the Corporation at the address set forth in Section 7:01 United States currency in an amount equal to the aggregate purchase price of the shares of Common Stock as to which such exercise relates; or
 
(b)
The Option holder shall tender to the Corporation shares of Common Stock already owned by the Option holder that, together with any cash tendered therewith, have an aggregate fair market value (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 7:01 is received by the Corporation) equal to the aggregate purchase price of the shares of Common Stock as to which such exercise relates; or
 
(c)
The Option holder shall deliver to the Corporation an exercise notice together with irrevocable instructions to a broker to deliver promptly to the Corporation the amount of sale or loan proceeds necessary to pay the aggregate purchase price of the shares of Common Stock as to which such exercise relates and to sell the shares of Common Stock to be issued upon exercise of the Option and deliver the cash proceeds less commissions and brokerage fees to the Option holder or to deliver the remaining shares of Common Stock to the Option holder.
 
Notwithstanding the foregoing provisions, the Committee, in granting Options pursuant to the Plan, may limit the methods in which an Option may be exercised by any person and, in processing any purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the method of exercise selected by the Option holder (other than the method of exercise set forth in Section 7:02(a)) if, (A) in the opinion of counsel to the Corporation, (i) the Option holder is or within the six months preceding such exercise was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a substantial likelihood that the method of exercise selected by the Option holder would subject the Option holder to a substantial risk of liability under Section 16 of the Exchange Act, or (B) in the opinion of the Committee, the method of exercise could have an adverse tax or accounting effect to the Corporation.
 
 
- 5 -
 
 
7:03
In addition to the alternative methods of exercise set forth in Section 7:02, holders of Nonqualified Stock Options shall be entitled, at or prior to the time the written notice provided for in Section 7:01 is delivered to the Corporation, to elect to have the Corporation withhold from the shares of Common Stock to be delivered upon exercise of the Nonqualified Stock Option that number of shares of Common Stock (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 7:01 is received by the Corporation) necessary to satisfy any withholding taxes attributable to the exercise of the Nonqualified Stock Option. Alternatively, such holder of a Nonqualified Stock Option may elect to deliver previously owned shares of Common Stock upon exercise of the Nonqualified Stock Option to satisfy any withholding taxes attributable to the exercise of the Nonqualified Stock Option. The maximum amount that an Option holder may elect to have withheld from the shares of Common Stock otherwise deliverable upon exercise or the maximum number of previously owned shares an Option holder may deliver shall be based on the maximum federal, state and local taxes payable by the Option holder. Notwithstanding the foregoing provisions, the Committee may include in the Option Agreement relating to any such Nonqualified Stock Option provisions limiting or eliminating the Option holder’s ability to pay his or her withholding tax obligation with shares of Common Stock or, if no such provisions are included in the Option Agreement but in the opinion of the Committee such withholding could have an adverse tax or accounting effect to the Corporation, at or prior to exercise of the Nonqualified Stock Option the Committee may so limit or eliminate the Option holder’s ability to pay his or her withholding tax obligation with shares of Common Stock. Notwithstanding the foregoing provisions, a holder of a Nonqualified Stock Option may not elect any of the methods of satisfying his or her withholding tax obligation in respect of any exercise if, in the opinion of counsel to the Corporation, (i) the holder of the Nonqualified Stock Option is or within the six months preceding such exercise was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a substantial likelihood that the election or timing of the election would subject the holder to a substantial risk of liability under Section 16 of the Exchange Act.
7:04
An Option holder at any time may elect in writing to abandon an Option in respect of all or part of the number of shares of Common Stock as to which the Option shall not have been exercised.
7:05
An Option holder shall have none of the rights of a stockholder of the Corporation until the shares of Common Stock covered by the Option are issued to him upon exercise of the Option.

ARTICLE 8:00
 
Terms and Conditions of Stock Appreciation Rights

8:01
Each Stock Appreciation Right granted pursuant to the Plan shall be evidenced by a Stock Appreciation Right Agreement in such form and with such terms and conditions (including, without limitation, noncompete, confidentiality or other similar provisions) as the Committee from time to time may determine. Notwithstanding the foregoing provision, Stock Appreciation Rights granted in tandem with a related Option shall be evidenced by the Option Agreement in respect of the related Option. The right of a Stock Appreciation Right holder to exercise his or her Stock Appreciation Rights shall at all times be subject to the terms and conditions set forth in the respective Stock Appreciation Right Agreement.
8:02
Except as provided in Section 9:03, each Stock Appreciation Right shall entitle the holder, subject to the terms and conditions of the Plan, to receive upon exercise of the Stock Appreciation Right an amount, payable in cash or shares of Common Stock (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 9:01 is received by the Corporation), equal to the Fair Market Value of a share of Common Stock on the date of receipt by the Corporation of the notice required by Section 9:01 less the Stock Appreciation Right Base Price. Notwithstanding the foregoing provision, each Stock Appreciation Right that is granted in tandem with a related Option shall entitle the holder, subject to the terms and conditions of the Plan, to surrender to the Corporation for cancellation all or a portion of the related Option, but only to the extent such Stock Appreciation Right and related Option then are exercisable, and to be paid therefor an amount, payable in cash or shares of Common Stock (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 9:01 is received by the Corporation), equal to the Fair Market Value of a share of Common Stock on the date of receipt by the Corporation of the notice required by Section 9:01 less the Stock Appreciation Right Base Price.
 
 
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8:03
Each Stock Appreciation Right, subject to the other limitations set forth in the Plan, may extend for a period of up to 10 years from the date on which it is granted. The term of each Stock Appreciation Right shall be determined by the Committee at the time of grant of the Stock Appreciation Right, provided that if no term is established by the Committee the term of the Stock Appreciation Right shall be 10 years from the date on which it is granted.
8:04
Unless otherwise provided by the Committee, the number of Stock Appreciation Rights granted pursuant to each Stock Appreciation Right Agreement shall be divided into four installments of 25% each. The first installment shall be exercisable 12 months after the date the Stock Appreciation Right was granted, and each succeeding installment shall be exercisable 12 months after the date the immediately preceding installment became exercisable. If a Stock Appreciation Right holder does not exercise the Stock Appreciation Right to the extent that he or she at any time has become entitled to exercise, the Stock Appreciation Right holder may exercise all or any part of the Stock Appreciation Right at any subsequent time during the term of the Stock Appreciation Right.
8:05
Stock Appreciation Rights shall be nontransferable and nonassignable, except that Stock Appreciation Rights may be transferred by testamentary instrument or by the laws of descent.
8:06
Upon voluntary or involuntary termination of a Stock Appreciation Right holder’s employment, his or her Stock Appreciation Right and all rights thereunder shall terminate effective as of the close of business on the date the Stock Appreciation Right holder ceases to be a regular, full-time employee of the Corporation or any of its subsidiaries, except (i) to the extent previously exercised, (ii) except as provided in Sections 8:07, 8:08, and 8:09, and (iii) in the case of involuntary termination of employment, for a period of 30 days thereafter the Stock Appreciation Right holder shall be entitled to exercise that portion of the Stock Appreciation Right which was exercisable at the close of business on the date the Stock Appreciation Right holder ceased to be a regular, full-time employee of the Corporation or any of its subsidiaries.
8:07
In the event a Stock Appreciation Right holder (i) ceases to be an executive or other key employee of the Corporation or any of its subsidiaries due to involuntary termination, (ii) takes a leave of absence from the Corporation or any of its subsidiaries for personal reasons or as a result of entry into the armed forces of the United States, or any of the departments or agencies of the United States government, or (iii) terminates employment by reason of illness, disability, or other special circumstance, the Committee may consider his or her case and may take such action in respect of the related Stock Appreciation Right Agreement as it may deem appropriate under the circumstances, including accelerating the time previously granted Stock Appreciation Rights may be exercised and extending the time following the Stock Appreciation Right holder’s termination of employment during which the Stock Appreciation Right holder is entitled to exercise his or her Stock Appreciation Rights, provided that in no event may any Stock Appreciation Right be exercised after the expiration of the term of the Stock Appreciation Right.
8:08
If a Stock Appreciation Right holder dies during the term of his or her Stock Appreciation Right without having fully exercised the Stock Appreciation Right, the executor or administrator of his or her estate or the person who inherits the right to exercise the Stock Appreciation Right by bequest or inheritance shall have the right within three years of the Stock Appreciation Right holder’s death to exercise the Stock Appreciation Rights that the deceased Stock Appreciation Right holder was entitled to purchase at the date of death, after which the Stock Appreciation Right shall lapse, provided that in no event may any Stock Appreciation Right be exercised after the expiration of the term of the Stock Appreciation Right.
 
 
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8:09
If a Stock Appreciation Right holder’s employment is terminated without having fully exercised his or her Stock Appreciation Right and (i) the Stock Appreciation Right holder is 62 years of age or older, or (ii) the Stock Appreciation Right holder has been employed by the Corporation or any of its subsidiaries for at least 10 years and the Stock Appreciation Right holder’s age plus years of such employment total not less than 55 years, then such Stock Appreciation Right holder shall have the right within three years of the Stock Appreciation Right holder’s termination of employment to exercise the Stock Appreciation Rights that the Stock Appreciation Right holder was entitled to exercise at the date of termination, after which the Stock Appreciation Right shall lapse, provided that in no event may any Stock Appreciation Right be exercised after the expiration of the term of the Stock Appreciation Right.
8:10
The granting of a Stock Appreciation Right pursuant to the Plan shall not constitute or be evidence of any agreement or understanding, expressed or implied, on the part of the Corporation or any of its subsidiaries to employ the Stock Appreciation Right holder for any specified period.

ARTICLE 9:00
 
Methods of Exercise of Stock Appreciation Rights

9:01
A Stock Appreciation Right holder (or other person or persons, if any, entitled to exercise a Stock Appreciation Right hereunder) desiring to exercise a Stock Appreciation Right granted pursuant to the Plan shall notify the Corporation in writing at its principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect, specifying the number of Stock Appreciation Rights to be exercised. Such written notice may be given by means of a facsimile transmission. If a facsimile transmission is used, the Stock Appreciation Right holder should mail the original executed copy of the written notice to the Corporation promptly thereafter.
9:02
The Committee in its sole and absolute discretion shall determine whether a Stock Appreciation Right shall be settled upon exercise in cash or in shares of Common Stock. The Committee, in making such a determination, may from time to time adopt general guidelines or determinations as to whether Stock Appreciation Rights shall be settled in cash or in shares of Common Stock.
9:03
In the event that a Stock Appreciation Right holder delivers the notice required by Section 9:01 and, in the opinion of counsel to the Corporation, (i) the Stock Appreciation Right holder is or within the six months preceding such notice was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a substantial likelihood that the exercise of the Stock Appreciation Right would subject the Stock Appreciation Right holder to a substantial risk of liability under Section 16 of the Exchange Act, the Corporation may refuse to recognize the Stock Appreciation Right holder’s exercise notice. In the event that a Stock Appreciation Right is exercised by a person who, in the opinion of counsel to the Corporation, is subject to reporting under Section 16(a) of the Exchange Act, the notice required by Section 9:01 is received by the Corporation within the “window periods” specified in Rule 16b-3(e) of the Exchange Act (or any successor thereto), and the Stock Appreciation Right is to be settled in cash, the Stock Appreciation Right holder shall be entitled to receive, in lieu of the amount provided for in Section 8:02 of the Plan, an amount equal to the highest Fair Market Value of a share of Common Stock during the applicable “window period” specified in Rule 16b-3(e) of the Exchange Act (or any successor thereto) less the Stock Appreciation Right Base Price.

 
ARTICLE 10:00
 
Limited Stock Appreciation Rights

10:01
Notwithstanding any other provision of the Plan, the Committee, in its sole and absolute discretion, may grant Limited Stock Appreciation Rights entitling Option holders to receive, in connection with a Change in Control (as defined in Section 10:02), a cash payment in cancellation of all of their Options which are outstanding on the date the Change in Control occurs (whether or not such Options are then presently exercisable; provided, however, that in the case of officers subject to Section 16 of the Exchange Act the Options to which the Limited Stock Appreciation Rights relate have been held for a period of at least six months from the date of acquisition to the date of cash settlement), which payment shall be equal to the number of shares covered by the cancelled Options multiplied by the excess over the exercise price of the Options of the higher of the (i) Fair Market Value of a share of Common Stock on the date of the Change in Control or (ii) the highest per share price paid for the shares of Common Stock in connection with the Change in Control (with the value of any noncash consideration paid in connection with the Change in Control to be determined by the Committee in its sole and absolute discretion). For purposes of this Section 10:01 as well as the other provisions of this Plan, once an Option or portion of an Option has terminated, lapsed or expired, or has been abandoned, in accordance with the provisions of the Plan, the Option (or the portion of the Option) that has terminated, lapsed or expired, or has been abandoned, shall cease to be outstanding. Limited Stock Appreciation Rights shall not be exercisable at the discretion of the holder but shall automatically be exercised upon a Change in Control.
 
 
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10:02
For purposes of Section 10:01 of the Plan, a “Change in Control” shall mean a change in control of the Corporation of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange Act, whether or not the Corporation is in fact required to comply therewith, provided that, without limitation, such a Change in Control shall be deemed to have occurred if (A) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Corporation or any of its subsidiaries, or a corporation owned, directly or indirectly, by the stockholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing 20% or more of the combined voting power of the Corporation’s then outstanding securities; or (B) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors and any new director (other than a director designated by a person who has entered into an agreement with the Corporation to effect a transaction described in clauses (A) or (C) of this Section 10.02) whose election by the Board of Directors or nomination for election by the Corporation’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or (C) the stockholders of the Corporation approve a merger, share exchange or consolidation of the Corporation with any other corporation, other than a merger, share exchange or consolidation which would result in the voting securities of the Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 60% of the combined voting power of the voting securities of the Corporation or such surviving entity outstanding immediately after such merger, share exchange or consolidation, or the stockholders of the Corporation approve a plan of complete liquidation of the Corporation or an agreement for the sale or disposition by the Corporation of all or substantially all the Corporation’s assets.

ARTICLE 11:00
 
Amendments and Discontinuance of the Plan
11:01
The Board of Directors shall have the right at any time and from time to time to amend, modify, or discontinue the Plan provided that, except as provided in Section 5:03, no such amendment, modification, or discontinuance of the Plan shall (i) revoke or alter the terms of any valid Option, Stock Appreciation Right, or Limited Stock Appreciation Right previously granted pursuant to the Plan, (ii) increase the number of shares of Common Stock to be reserved for issuance and sale pursuant to Options or Stock Appreciation Rights granted pursuant to the Plan, (iii) decrease the price determined pursuant to the provisions of Section 6:02 or increase the amount of cash or shares of Common Stock that a Stock Appreciation Right holder is entitled to receive upon exercise of a Stock Appreciation Right, (iv) change the class of employee to whom Options or Stock Appreciation Rights may be granted pursuant to the Plan, or (v) provide for Options or Stock Appreciation Rights exercisable more than 10 years after the date granted.
 
 
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ARTICLE 12:00
 
Plan Subject to Governmental Laws and Regulations

12:01
The Plan and the grant and exercise of Options, Stock Appreciation Rights, and Limited Stock Appreciation Rights pursuant to the Plan shall be subject to all applicable governmental laws and regulations. Notwithstanding any other provision of the Plan to the contrary, the Board of Directors may in its sole and absolute discretion make such changes in the Plan as may be required to conform the Plan to such laws and regulations.

ARTICLE 13:00
 
Duration of the Plan

13:01
No Option or Stock Appreciation Right shall be granted pursuant to the Plan after the close of business on February 13, 2006.

 
 
 
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Exhibit 10.7
 
 
THE BLACK & DECKER 2003 STOCK OPTION PLAN


The proper execution of the duties and responsibilities of the executives and other key employees of The Black & Decker Corporation and its subsidiaries is a vital factor in the continued growth and success of the Corporation.  Toward this end, it is necessary to attract and retain effective and capable employees to assume positions that contribute materially to the successful operation of the business of the Corporation.  It will benefit the Corporation, therefore, to bind the interests of these persons more closely to its own interests by offering them an attractive opportunity to acquire a proprietary interest in the Corporation and thereby provide them with added incentive to remain in its employ and to increase the prosperity, growth, and earnings of the Corporation.  This stock option plan will serve these purposes.


ARTICLE 1:00

Definitions

The following terms wherever used herein shall have the meanings set forth below.

1:01
The term “Board of Directors” shall mean the Board of Directors of the Corporation.

1:02
The term “Change in Control” shall have the meaning provided in Section 10:02 of the Plan.

1:03
The term “Code” shall mean the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder.

1:04
The term “Committee” shall mean the Compensation Committee of the Board of Directors.

1:05
The term “Common Stock” shall mean the shares of common stock, par value $.50 per share, of the Corporation.

1:06
The term “Corporation” shall mean The Black & Decker Corporation.

1:07
The term “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

1:08
The term “Fair Market Value of a share of Common Stock” shall mean the closing sale price per share of Common Stock as finally reported in the New York Stock Exchange Composite Transactions for the New York Stock Exchange, or if shares of Common Stock are not sold on such date, the closing sale price per share of Common Stock as finally reported in the New York Stock Exchange Composite Transactions for the New York Stock Exchange for the most recent prior date on which shares of Common Stock were sold.

1:09
The term “Immediate Family Member” shall mean each of (i) the children, step children or grandchildren of the Initial Holder, (ii) the spouse or any parent of the Initial Holder, (iii) any trust solely for the benefit of any such family members, and (iv) any partnership or other entity in which such family members are the only partners or other equity holders.

1:10
The term “Incentive Stock Option” shall mean any Option granted pursuant to the Plan that is designated as an Incentive Stock Option and that satisfies the require­ments of Section 422(b) of the Code.

1:11
The term “Initial Holder,” with respect to an Option or Right granted under the Plan, shall mean the executive or other key employee of the Corporation granted the Option or Right.

1:12
The term “Limited Stock Appreciation Right” shall mean a limited tandem stock appreciation right that entitles the holder to receive cash upon a Change in Control pursuant to Article 10:00 of the Plan.
 
 
 
 

 
1:13
The term “Non-Qualified Stock Option” shall mean any Option granted pursuant to the Plan that is not an Incentive Stock Option.

1:14
The term “Option” or “Stock Option” shall mean a right granted pursuant to the Plan to purchase shares of Common Stock, and shall include the terms Incentive Stock Option and Non-Qualified Stock Option.

1:15
The term “Option Agreement” shall mean the written agreement representing Options granted pursuant to the Plan as contemplated by Article 6:00 of the Plan.

1:16
The term “Option Holder” shall mean the Initial Holder so long as he or she holds an Option initially granted to the Initial Holder, and thereafter shall mean the beneficiary or the Immediate Family Member to whom the Option has been transferred in accordance with Section 6:05 of the Plan.

1:17
The term “Plan” shall mean The Black & Decker 2003 Stock Option Plan as approved by the Board of Directors on February 13, 2003, and adopted by the stockholders of the Corporation at the 2003 Annual Meeting of Stockholders, as the same may be amended from time to time.

1:18
The term “Rights” shall include Stock Appreciation Rights and Limited Stock Appreciation Rights.

1:19
The term “Section 162(m) Regulations” shall mean the regulations adopted pursuant to Section 162(m) of the Code.

1:20
The term “Stock Appreciation Right” shall mean a right to receive cash or shares of Common Stock pursuant to Article 8:00 of the Plan.

1:21
The term “Stock Appreciation Right Agreement” shall mean the written agreement representing Stock Appreciation Rights granted pursuant to the Plan as contemplated by Article 8:00 of the Plan.

1:22
The term “Stock Appreciation Right Base Price” shall mean the base price for determining the value of a Stock Appreciation Right under Section 8:02 of the Plan, which Stock Appreciation Right Base Price shall be established by the Committee at the time of the grant of Stock Appreciation Rights pursuant to the Plan and shall not be less than the Fair Market Value of a share of Common Stock on the date of grant.  If the Committee does not establish a specific Stock Appreciation Right Base Price at the time of grant, the Stock Appreciation Right Base Price shall be equal to the Fair Market Value of a share of Common Stock on the date of grant of the Stock Appreciation Right.

1:23
The term “Stock Appreciation Right Holder” shall mean the Initial Holder so long as he or she holds a Stock Appreciation Right initially granted to the Initial Holder, and thereafter shall mean the beneficiary or the Immediate Family Member to whom the Stock Appreciation Right has been transferred in accordance with Section 8:05 of the Plan.

1:24
The term “subsidiary” or “subsidiaries” shall mean a corporation, partnership, limited liability company, joint venture, or other legal entity of which the Corporation, either directly or together with any other subsidiary of the Corporation, owns more than 50% of the voting power in the election of directors or their equivalents.


ARTICLE 2:00

Effective Date of the Plan

2:01
The Plan shall become effective upon stockholder approval, provided that such approval is received on or before May 31, 2003, and provided further that the Committee may grant Options or Rights pursuant to the Plan prior to stockholder approval if such Options or Rights by their terms are contingent upon subsequent stock­holder approval of the Plan.
 
 

 
2
 

 
ARTICLE 3:00

Administration

3:01
The Plan shall be administered by the Committee.

3:02
The Committee may establish, from time to time and at any time, subject to the limitations of the Plan as set forth herein, such rules and regulations and amendments and supplements thereto as it deems neces­sary to comply with applicable law and regulation and for the proper administration of the Plan.

3:03
The Committee shall from time to time determine the names of those executives and other key employees who, in its opinion, should receive Options or Rights, and shall determine the numbers of shares on which Options should be granted or upon which Rights should be based to each such person and the nature of the Options or Rights to be granted, including without limitation whether the Options or Rights shall be transferable in accordance with the terms and conditions provided in Section 6:12 or Section 8:11 of the Plan.

3:04
Options and Rights shall be granted by the Corporation only upon the prior approval of the Committee and upon the execution of an Option Agreement or Stock Appreciation Right Agreement between the Corporation and the Initial Holder.

3:05
The Committee’s interpretation and construction of the provisions of the Plan and the rules and regulations adopted by the Committee shall be final.  No member of the Committee or the Board of Directors shall be liable for any action taken or determination made, in respect of the Plan, in good faith.


ARTICLE 4:00

Participation in the Plan

4:01
Participation in the Plan shall be limited to such executives and other key employees of the Corporation and its subsidiaries who at the date of grant of an Option or Right are regular, full-time employees of the Corporation or any of its subsidi­aries and who shall be designated by the Committee together with any permitted transferees in accordance with the terms and conditions of the Plan.

4:02
No member of the Board of Directors who is not also an employee shall be eligible to participate in the Plan.  No employee who owns beneficially more than 10% of the total combined voting power of all classes of stock of the Corporation shall be eligible to participate in the Plan.

4:03
No employee may be granted, in any calendar year, Options or Stock Appreciation Rights exceeding 1,000,000 in the aggregate under the Plan.


ARTICLE 5:00

Stock Subject to the Plan

5:01
There shall be reserved for the granting of Options or Stock Appreciation Rights pursuant to the Plan and for issuance and sale pursuant to such Options or Stock Appreciation Rights 5,000,000 shares of Common Stock.  To determine the number of shares of Common Stock available at any time for the granting of Options or Stock Appreciation Rights, there shall be deducted from the total number of reserved shares of Common Stock the number of shares of Common Stock in respect of which Options have been granted pursuant to the Plan that are still outstanding or have been exer­cised.  The shares of Common Stock to be issued upon the exercise of Options or Stock Appreciation Rights granted pursuant to the Plan shall be made available from the authorized and unissued shares of Common Stock.  If for any reason shares of Common Stock as to which an Option has been granted cease to be subject to purchase thereunder, then such shares of Common Stock again shall be available for issuance pursuant to the exercise of Options or Stock Appreciation Rights pursuant to the Plan.  Except as provided in Section 5:03 of the Plan, however, the aggregate number of shares of Common Stock that may be issued upon the exercise of Options and Stock Appreciation Rights pursuant to the Plan shall not exceed 5,000,000 shares and no more than 5,000,000 Stock Appreciation Rights shall be granted pursuant to the Plan.
 
 
 
3

 
 
5:02
Proceeds from the purchase of shares of Common Stock upon the exercise of Options granted pursuant to the Plan shall be used for the general business purposes of the Corporation.

5:03
Subject to the provisions of Section 10:01 of the Plan, in the event of reorganization, recapitalization, stock split, stock dividend, combination of shares of Common Stock, merger, consolidation, share exchange, acquisi­tion of property or stock, or any change in the capital structure of the Corporation, the Committee shall make such adjustments as may be appro­priate in the number of Options or Stock Appreciation Rights that may be granted to an employee in any calendar year, in the number and kind of shares reserved for purchase by executives or other key employees, in the number, kind and price of shares covered by Options and Stock Appreciation Rights granted pursuant to the Plan but not then exercised, and in the number of Rights, if any, granted pursuant to the Plan but not then exercised.


ARTICLE 6:00

Terms and Conditions of Options

6:01
Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such form and with such terms and conditions (including, without limitation, non-compete, confidentiality or other similar provisions or provisions relating to transfer) as the Committee from time to time may determine.  The right of an Option Holder to exercise his, her or its Option shall at all times be subject to the terms and conditions set forth in the respective Option Agreement.

6:02
The exercise price per share for Options shall be established by the Committee at the time of the grant of Options pursuant to the Plan and shall not be less than the Fair Market Value of a share of Common Stock on the date on which the Option is granted.  If the Committee does not establish a specific exercise price per share at the time of grant, the exercise price per share shall be equal to the Fair Market Value of a share of Common Stock on the date of grant of the Options.

6:03
Each Option, subject to the other limitations set forth in the Plan, may extend for a period of up to 10 years from the date on which it is granted.  The term of each Option shall be determined by the Committee at the time of grant of the Option, provided that if no term is established by the Committee the term of the Option shall be 10 years from the date on which it is granted.

6:04
Unless otherwise provided by the Committee, the number of shares of Common Stock subject to each Option shall be divided into four installments of 25% each.  The first install­ment shall be exercisable 12 months after the date the Option was granted, and each succeeding installment shall be exercisable 12 months after the date the immediately preceding installment became exercisable.  If an Option Holder does not purchase the full number of shares of Common Stock that he, she or it at any time has become entitled to purchase, the Option Holder may purchase all or any part of those shares of Common Stock at any subsequent time during the term of the Option.

6:05
Options shall be non-transferable and non-assignable, except that (i) Options may be transferred by testamentary instrument or by the laws of descent and distribution, and (ii) subject to the terms and conditions of the Option Agreement or any other terms and conditions imposed by the Committee from time to time, Options may be transferred in accordance with the terms and conditions provided in Section 6:12 of the Plan if the applicable Option Agreement or other action of the Committee expressly provides that the Options are transferable.
 
 
 
4
 

 
6:06
Upon voluntary or involuntary termination of an Initial Holder’s employment, his or her Option (including any Option transferred in accordance with the terms and conditions provided in Section 6:12 of the Plan) and all rights there­under shall terminate effective at the close of business on the date the Initial Holder ceases to be a regular, full-time employee of the Corporation or any of its subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections 6:07, 6:08, and 6:09 of the Plan, and (iii) in the case of involuntary termination of employment, for a period of 30 days thereafter the Option Holder shall be entitled to exercise that portion of the Option that was exercisable at the close of business on the date the Initial Holder ceased to be a regular, full-time employee of the Corporation or any of its subsidiaries, provided that in no event may any Option be exercised after the expiration of the term of the Option.

6:07
In the event an Initial Holder (i) ceases to be an executive or other key employee of the Corporation or any of its subsidiaries due to involuntary termina­tion, (ii) takes a leave of absence from the Corpora­tion or any of its subsidiaries for personal reasons or as a result of entry into the armed forces of the United States, or any of the departments or agencies of the United States government, or (iii) terminates employment by reason of illness, disability, or other special circum­stance, the Committee may consider his or her case and may take such action in respect of the related Option Agreement as it may deem appro­priate under the circumstances, including accelerating the time previously granted Options may be exercised and extend­ing the time follow­ing the Initial Holder’s termination of employment during which the Option Holder is entitled to purchase the shares of Common Stock subject to such Options, provided that in no event may any Option be exercised after the expiration of the term of the Option.

6:08
If an Initial Holder dies during the term of his or her Option without the Option having been exercised in full, (i) the executor or adminis­trator of his or her estate or the person who inherits the right to exercise the Option by bequest or inheritance in the event the Initial Holder was the Option Holder at the date of death or (ii) the Option Holder in the event the Option had been transferred in accordance with the terms and conditions provided in Section 6:12 of the Plan, shall have the right within three years of the Initial Holder’s death to purchase the number of shares of Common Stock that the deceased Initial Holder (or Option Holder, as the case may be) was entitled to purchase at the date of death, after which the Option shall lapse, provided that in no event may any Option be exercised after the expiration of the term of the Option.

6:09
If an Initial Holder’s employment is terminated without his or her Option having been exercised in full and (i) the Initial Holder is 62 years of age or older, or (ii) the Initial Holder has been employed by the Corporation or any of its subsidi­aries for at least 10 years and the Initial Holder’s age plus years of such employ­ment total not less than 55 years, then such Initial Holder (or the Option Holder in the event the Option had been transferred in accordance with the terms and conditions provided in Section 6:12 of the Plan) shall have the right within three years of the Initial Holder’s termination of employment to purchase the number of shares of Common Stock that the Initial Holder (or Option Holder, as the case may be) was entitled to purchase at the date of termina­tion, after which the Option shall lapse, provided that in no event may any Option be exercised after the expira­tion of the term of the Option.  Notwithstanding the foregoing and only with respect to Options granted in April 2009 or afterwards, if an Initial Holder’s employment is terminated without his or her Option having been exercised in full and the Initial Holder is 60 years of age or older, then such Initial Holder (or the Option Holder in the event the Option had been transferred in accordance with Section 6:12 of the Plan) shall have the right during the remaining term of the Option to purchase the number of shares of Common Stock that the Initial Holder (or Option Holder, as the case may be) was entitled to purchase at the date of the Initial Holder’s termination of employment, after which the Option shall lapse.

6:10
The granting of an Option pursuant to the Plan shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Corporation or any of its subsidi­aries to employ the Initial Holder for any specified period.

6:11
In addition to the general terms and conditions set forth in this Article 6:00 in respect of Options granted pursuant to the Plan, Incentive Stock Options granted pursuant to the Plan shall be subject to the following additional terms and conditions:
 
 
 
5

 
 
(a)
The aggregate fair market value (determined at the time the Incentive Stock Option is granted) of the shares of Common Stock in respect of which “incentive stock options” under Section 422 of the Code are exercisable for the first time by the Option Holder during any calendar year (under all such plans of the Corporation and its subsidiaries) shall not exceed $100,000;

 
(b)
The Option Agreement in respect of an Incentive Stock Option may contain any other terms and conditions specified by the Board of Directors that are not inconsistent with the Plan, except that such terms and conditions must be consistent with the requirements for “incentive stock options” under Section 422 of the Code; and

 
(c)
Incentive Stock Options shall not be transferable in accordance with the terms and conditions provided in Section 6:12 of the Plan.

6:12
The Committee may provide, in the original grant of a Non-Qualified Stock Option or in an amendment or supplement to a previous grant, that some or all of the Non-Qualified Stock Options granted under the Plan are transferable by the Initial Holder to an Immediate Family Member of the Initial Holder, provided that (i) the Option Agreement, as it may be amended from time to time, expressly so provides or the Committee otherwise designates the Option as transferable, (ii) the transfer by the Initial Holder is a bona fide gift without consideration, (iii) the transfer is irrevocable, (iv) the Initial Holder and any such transferee provides such documentation or other information concerning the transfer or the transferee as the Committee or any employee of the Corporation acting on behalf of the Committee may from time to time request, and (v) the Initial Holder or the Option Holder complies with all of the terms and conditions (including, without limitation, any further restrictions or limitations) included in the Option Agreement.  Any Non-Qualified Stock Option transferred in accordance with the terms and conditions provided in this Section 6:12 shall continue to be subject to the same terms and conditions that were applicable to such Non-Qualified Stock Option prior to the transfer.  Notwithstanding any other provisions of the Plan, the Corporation shall not be required to honor any exercise of an Option by an Immediate Family Member of an Option transferred in accordance with the terms and conditions provided in this Section 6:12 unless and until payment or provision for payment of any applicable withholding taxes has been made.


ARTICLE 7:00

Methods of Exercise of Options

7:01
An Option Holder (or other person or persons, if any, entitled to exercise an Option here­under) desiring to exercise an Option granted pursuant to the Plan as to all or part of the shares of Common Stock covered by the Option shall (i) notify either the Corporation at its principal office at 701 East Joppa Road, Towson, Maryland 21286, or the third party retained by the Corporation to administer the Plan to that effect, specifying the number of shares of Common Stock to be purchased and the method of payment therefor, and (ii) make payment or provision for payment for the shares of Common Stock so purchased in accordance with this Article 7:00.

7:02
Payment or provision for payment shall be made as follows:

 
(a)
The Option Holder shall deliver to the Corpora­tion at the address set forth in Section 7:01 of the Plan United States currency in an amount equal to the aggregate purchase price of the shares of Common Stock as to which such exercise relates; or

 
(b)
The Option Holder shall tender to the Corpora­tion shares of Common Stock already owned by the Option Holder that, together with any cash tendered therewith, have an aggre­gate fair market value (deter­mined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 7:01 of the Plan is received by the Corporation) equal to the aggregate purchase price of the shares of Common Stock as to which such exercise relates; or
 
 
 
6
 

 
 
(c)
The Option Holder shall deliver irrevocable instructions to a broker to deliver promptly to the Corporation the amount of sale or loan proceeds neces­sary to pay the aggregate purchase price of the shares of Common Stock as to which such exercise relates and to sell the shares of Common Stock to be issued upon exercise of the Option and deliver the cash proceeds less commissions and brokerage fees to the Option Holder or to deliver the remaining shares of Common Stock to the Option Holder.

 
Notwithstanding the foregoing provisions, the Committee, in granting Options pursuant to the Plan, may limit the methods in which an Option may be exercised by any person and, in process­ing any purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the method of exercise selected by the Option Holder (other than the method of exercise set forth in Section 7:02(a) of the Plan) if, (A) in the opinion of counsel to the Corpora­tion, (i) the Initial Holder or the Option Holder is or within the six months preceding such exercise was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a substantial likelihood that the method of exercise selected by the Option Holder would subject the Initial Holder or the Option Holder to a substantial risk of liability under Section 16 of the Exchange Act, (B) in the opinion of the Committee, the method of exercise could have an adverse tax or accounting effect to the Corporation, or (C) in the opinion of counsel to the Corporation, the method of exercise selected by the Option Holder would subject the Corporation to a risk of liability under the Exchange Act.

7:03
In addition to the alternative methods of exercise set forth in Section 7:02 of the Plan, holders of Non-Qualified Stock Options shall be entitled, at or prior to the time the notice provided for in Section 7:01 of the Plan is provided to the Corporation, to elect to have the Corporation withhold from the shares of Common Stock to be delivered upon exercise of the Non-Qualified Stock Option that number of shares of Common Stock (deter­mined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 7:01 of the Plan is received by the Corporation) necessary to satisfy any withholding taxes attributable to the exercise of the Non-Qualified Stock Option.  The maximum number of shares that an Option Holder may elect to have withheld from the shares of Common Stock otherwise deliverable upon exercise shall be the number of shares that have an aggregate fair market value (based on the Fair Market Value of a share of Common Stock on the date of exercise) equal to the dollar amount of the minimum statutory withholding for federal, state, and local taxes, including payroll taxes, payable by the Option Holder.  Alternatively, such holder of a Non-Qualified Stock Option may elect to deliver previously owned shares of Common Stock (which shares have been held for at least six months) upon exercise of the Non-Qualified Stock Option to satisfy any withholding taxes attributable to the exercise of the Non-Qualified Stock Option.  Notwith­standing the foregoing provisions, the Committee may include in the Option Agreement relating to any such Non-Qualified Stock Option pro­visions limiting or eliminating the Option Holder’s ability to pay his or her withholding tax obligation by withholding or delivering shares of Common Stock or, if no such provisions are included in the Option Agreement but in the opinion of the Committee such with­holding or delivery of shares could have an adverse tax or accounting effect to the Corporation, at or prior to exercise of the Non-Quali­fied Stock Option the Committee may so limit or eliminate the Option Holder’s ability to pay his or her withholding tax obligation with shares of Common Stock.  Notwithstanding the foregoing provisions, a holder of a Non-Qualified Stock Option may not elect any of the methods of satisfying his or her with­holding tax obligation in respect of any exercise if, in the opinion of counsel to the Corporation, (i) the Initial Holder or the holder of the Non-Qualified Stock Option is or within the six months preceding such exercise was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a substantial likelihood that the election or timing of the election would subject the Initial Holder or the holder of the Non-Qualified Stock Option to a substan­tial risk of liability under Section 16 of the Exchange Act.

7:04
An Option Holder at any time may elect in writing to abandon an Option in respect of all or part of the number of shares of Common Stock as to which the Option shall not have been exercised.

7:05
An Option Holder shall have none of the rights of a stockholder of the Corporation until the shares of Common Stock covered by the Option are issued upon exercise of the Option.
 
 

 
7

ARTICLE 8:00

Terms and Conditions of Stock Appreciation Rights

8:01
Each Stock Appreciation Right granted pursuant to the Plan shall be evidenced by a Stock Appreciation Right Agreement in such form and with such terms and conditions (including, without limitation, non-compete, confidentiality or other similar provisions or provisions relating to transfer) as the Committee from time to time may determine.  Notwithstanding the foregoing provision, Stock Appreciation Rights granted in tandem with a related Option shall be evidenced by the Option Agreement in respect of the related Option.  The right of a Stock Appreciation Right Holder to exercise his, her or its Stock Appreciation Right shall at all times be subject to the terms and conditions set forth in the respective Stock Appreciation Right Agreement.

8:02
Each Stock Appreciation Right shall entitle the holder, subject to the terms and conditions of the Plan, to receive upon exercise of the Stock Appreciation Right an amount, payable in cash or shares of Common Stock (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 9:01 of the Plan is received by the Corporation), equal to the Fair Market Value of a share of Common Stock on the date of receipt by the Corporation of the notice required by Section 9:01 of the Plan less the Stock Appreciation Right Base Price.  Notwithstanding the foregoing provision, each Stock Appreciation Right that is granted in tandem with a related Option shall entitle the holder, subject to the terms and conditions of the Plan, to surrender to the Corporation for cancellation all or a portion of the related Option, but only to the extent such Stock Appreciation Right and related Option then are exercisable, and to be paid therefor an amount, payable in cash or shares of Common Stock (determined based on the Fair Market Value of a share of Common Stock on the date the notice set forth in Section 9:01 of the Plan is received by the Corporation), equal to the Fair Market Value of a share of Common Stock on the date of receipt by the Corporation of the notice required by Section 9:01 of the Plan less the Stock Appreciation Right Base Price.

8:03
Each Stock Appreciation Right, subject to the other limitations set forth in the Plan, may extend for a period of up to 10 years from the date on which it is granted.  The term of each Stock Appreciation Right shall be determined by the Committee at the time of grant of the Stock Appreciation Right, provided that if no term is established by the Committee the term of the Stock Appreciation Right shall be 10 years from the date on which it is granted.

8:04
Unless otherwise provided by the Committee, the number of Stock Appreciation Rights granted pursuant to each Stock Appreciation Right Agreement shall be divided into four installments of 25% each.  The first install­ment shall be exercisable 12 months after the date the Stock Appreciation Right was granted, and each succeed­ing installment shall be exercisable 12 months after the date the immediately preceding installment became exercisable.  If a Stock Appreciation Right Holder does not exercise the Stock Appreciation Right to the extent that he, she or it at any time has become entitled to exercise the Stock Appreciation Right, the Stock Appreciation Right Holder may exercise all or any part of the Stock Appreciation Right at any subsequent time during the term of the Stock Appreciation Right.

8:05
Stock Appreciation Rights shall be non-transferable and non-assignable, except that (i) Stock Appreciation Rights may be transferred by testamentary instrument or by the laws of descent and distribution, and (ii) subject to the terms and conditions of the Stock Appreciation Right Agreement or any other terms and conditions imposed by the Committee from time to time, Stock Appreciation Rights may be transferred in accordance with the terms and conditions provided in Section 8:11 of the Plan if the applicable Stock Appreciation Right Agreement or other action of the Committee expressly provides that the Stock Appreciation Rights are transferable.

8:06
Upon voluntary or involuntary termination of an Initial Holder’s employment, his or her Stock Appreciation Rights (including any Stock Appreciation Rights transferred in accordance with the terms and conditions provided in Section 8:11 of the Plan) and all rights thereunder shall terminate effective as of the close of business on the date the Initial Holder ceases to be a regular, full-time employee of the Corporation or any of its subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections 8:07, 8:08, and 8:09 of the Plan, and (iii) in the case of involuntary termination of employment, for a period of 30 days thereafter the Stock Appreciation Right Holder shall be entitled to exercise that portion of each Stock Appreciation Right that was exercisable at the close of business on the date the Initial Holder ceased to be a regular, full-time employee of the Corporation or any of its subsidiaries.
 
 
 
8

 
 
8:07
If an Initial Holder (i) ceases to be an executive or other key employee of the Corporation or any of its subsidiaries due to involun­tary termination, (ii) takes a leave of absence from the Corporation or any of its subsidiaries for personal reasons or as a result of entry into the armed forces of the United States, or any of the departments or agencies of the United States government, or (iii) terminates employment by reason of illness, dis­ability, or other special circumstance, the Committee may consider his or her case and may take such action in respect of the related Stock Appreciation Right Agreement as it may deem appropriate under the circumstances, including accelerating the time previously granted Stock Appreciation Rights may be exercised and extending the time following the Initial Holder’s termination of employment during which the Stock Appreciation Right Holder is entitled to exercise the Stock Appreciation Rights, provided that in no event may any Stock Appreciation Right be exercised after the expiration of the term of the Stock Appreciation Right.

8:08
If an Initial Holder dies during the term of his or her Stock Appreciation Right without the Stock Appreciation Right having been exercised in full, (i) the executor or administrator of his or her estate or the person who inherits the right to exercise the Stock Appre­ciation Right by bequest or inheritance in the event the Initial Holder was the Stock Appreciation Right Holder at the date of death or (ii) the Stock Appreciation Right Holder in the event the Stock Appreciation Right had been transferred in accordance with the terms and conditions provided in Section 8:11 of the Plan, shall have the right within three years of the Initial Holder’s death to exercise the Stock Appreciation Rights that the Initial Holder (or Stock Appreciation Right Holder, as the case may be) was entitled to purchase at the date of death, after which the Stock Appreciation Right shall lapse, provided that in no event may any Stock Appre­ciation Right be exercised after the expiration of the term of the Stock Appreciation Right.

8:09
If an Initial Holder’s employment is terminated without his or her Stock Appreciation Right having been exercised in full and (i) the Initial Holder is 62 years of age or older, or (ii) the Initial Holder has been employed by the Corporation or any of its subsidiaries for at least 10 years and the Initial Holder’s age plus years of such employment total not less than 55 years, then such Initial Holder (or the Stock Appreciation Right Holder in the event the Stock Appreciation Right had been transferred in accordance with the terms and conditions provided in Section 8:11 of the Plan) shall have the right within three years of the Initial Holder’s termination of employment to exercise the Stock Appreciation Rights that the Initial Holder (or Stock Appreciation Right Holder, as the case may be) was entitled to exercise at the date of termination, after which the Stock Appreciation Right shall lapse, provided that in no event may any Stock Appreciation Right be exercised after the expiration of the term of the Stock Appre­ciation Right.

8:10
The granting of a Stock Appreciation Right pursuant to the Plan shall not constitute or be evidence of any agreement or understanding, expressed or implied, on the part of the Corporation or any of its subsidiaries to employ the Initial Holder for any specified period.

8:11
The Committee may provide, in the original grant of a Stock Appreciation Right or in an amendment or supplement to a previous grant, that some or all of the Stock Appreciation Rights granted under the Plan are transferable by the Initial Holder to an Immediate Family Member of the Initial Holder, provided that (i) the Stock Appreciation Right Agreement, as it may be amended from time to time, expressly so provides or the Committee otherwise designates the Stock Appreciation Right as transferable, (ii) the transfer by the Initial Holder is a bona fide gift without consideration, (iii) the transfer is irrevocable, (iv) the Initial Holder and any such transferee provides such documentation or other information concerning the transfer or the transferee as the Committee or any employee of the Corporation acting on behalf of the Committee may from time to time request, and (v) the Initial Holder or the Stock Appreciation Right Holder complies with all of the terms and conditions (including, without limitation, any further restrictions or limitations) included in the Stock Appreciation Right Agreement.  Any Stock Appreciation Right transferred in accordance with the terms and conditions provided in this Section 8:11 shall continue to be subject to the same terms and conditions that were applicable to such Stock Appreciation Right prior to the transfer.  Notwithstanding any other provisions of the Plan, the Corporation shall not be required to honor any exercise of a Stock Appreciation Right by an Immediate Family Member of a Stock Appreciation Right transferred in accordance with the terms and conditions provided in this Section 8:11 unless and until payment or provision for payment of any applicable withholding taxes has been made.
 
 

 
9
 

 
ARTICLE 9:00

Methods of Exercise of Stock Appreciation Rights

9:01
A Stock Appreciation Right Holder (or other person or persons, if any, entitled to exercise a Stock Appreciation Right hereunder) desiring to exercise a Stock Appreciation Right granted pursuant to the Plan shall notify the Corporation in writing at its principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect, specifying the number of Stock Appreciation Rights to be exercised.  Such written notice may be given by means of a facsimile transmission.  If a facsimile transmission is used, the Stock Appreciation Right Holder should mail the original executed copy of the written notice to the Corporation promptly thereafter.

9:02
The Committee in its sole and absolute discretion shall determine whether a Stock Appreciation Right shall be settled upon exercise in cash or in shares of Common Stock.  The Committee, in making such a determination, may from time to time adopt general guidelines or determinations as to whether Stock Appreciation Rights shall be settled in cash or in shares of Common Stock.

ARTICLE 10:00

Limited Stock Appreciation Rights

10:01
Notwithstanding any other provision of the Plan, the Committee, in its sole and absolute discretion, may grant Limited Stock Appreciation Rights entitling Option Holders to receive, in connection with a Change in Control, a cash payment in cancella­tion of all of their Options that are outstanding on the date the Change in Control occurs (whether or not such Options are then presently exercisable), which payment shall be equal to the number of shares covered by the cancelled Options multiplied by the excess over the exercise price of the Options of the higher of the (i) Fair Market Value of a share of Common Stock on the date of the Change in Control or (ii) the highest per share price paid for the shares of Common Stock in connection with the Change in Control (with the value of any non-cash consideration paid in connection with the Change in Control to be deter­mined by the Committee in its sole and absolute discretion and if the Committee, in its sole and absolute discretion, determines that such valuation will comply with Section 409A of the Code).  For purposes of this Section 10:01 as well as the other provisions of this Plan, once an Option or portion of an Option has terminated, lapsed or expired, or has been abandoned, in accordance with the provisions of the Plan, the Option (or the portion of the Option) that has terminated, lapsed or expired, or has been abandoned, shall cease to be outstanding.  Limited Stock Apprecia­tion Rights shall not be exercisable at the discretion of the Option Holder but shall automatically be exercised upon a Change in Control.

10:02
A “Change in Control” shall mean a change in control of the Corporation of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promul­gated under the Exchange Act, whether or not the Corporation is in fact required to comply therewith, provided that, without limitation, such a change in control shall be deemed to have occurred if (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Corpora­tion or any of its subsidiaries, or a corporation owned, directly or indirectly, by the stockholders of the Corporation in substantially the same propor­tions as their ownership of stock of the Corporation, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing 20% or more of the combined voting power of the Corporation’s then outstanding securities; (ii) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors and any new director (other than a director designated by a person who has entered into an agreement with the Corporation to effect a transaction described in clauses (i) or (iv) of this Section 10.02) whose election by the Board of Directors or nomina­tion for election by the Corporation’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; (iii) the Corporation enters into an agreement, the consummation of which would result in the occurrence of a Change in Control; or (iv) the stockholders of the Corporation approve a merger, share exchange or consolidation of the Corporation with any other corporation or entity, other than a merger, share exchange or consoli­dation that would result in the voting securities of the Corpora­tion outstanding immediately prior thereto continuing to represent (either by remaining outstand­ing or by being converted into voting securities of the surviving entity) at least 60% of the combined voting power of the voting securities of the Corporation or such surviving entity outstanding immediately after the merger, share exchange or consolida­tion, or the stockholders of the Corporation approve a plan of complete liquidation of the Corporation or an agreement for the sale or disposition by the Corporation of all or substantially all the Corporation’s assets.
 
 
 
 
10
 

 
10:03
Limited Stock Appreciation Rights shall be non-transferable and non-assignable, except that Limited Stock Appreciation Rights shall automatically be transferred and assigned in tandem with a transfer of the related Options in accordance with Section 6:05 of the Plan.


ARTICLE 11:00

Amendments and Discontinuance of the Plan

11:01
The Board of Directors shall have the right at any time and from time to time to amend, modify, or discontinue the Plan provided that, except as provided in Section 5:03 of the Plan, no such amendment, modification, or discon­tinuance of the Plan shall (i) revoke or alter the terms of any valid Option, Stock Appreciation Right, or Limited Stock Appreciation Right previously granted pursuant to the Plan, (ii) increase the number of shares of Common Stock to be reserved for issuance and sale pursuant to Options or Stock Appreciation Rights granted pursuant to the Plan, (iii) decrease the price determined pursuant to the provisions of Section 6:02 of the Plan or increase the amount of cash or shares of Common Stock that a Stock Appreciation Right Holder is entitled to receive upon exercise of a Stock Appreciation Right, (iv) change the class of employee to whom Options or Stock Appreciation Rights may be granted pursuant to the Plan, (v) provide for Options or Stock Appreciation Rights exercisable more than 10 years after the date granted or (vi) increase the number of Options or Stock Appreciation Rights that may be granted to an employee in any calendar year under Section 4.03 of the Plan.  If an amendment would (i) materially increase the benefits accruing to participants under the Plan, (ii) materially increase the aggregate number of securities that may be issued under the Plan, or (iii) materially modify the requirements as to eligibility for participation in the Plan, then to the extent required by applicable law or deemed necessary or advisable by the Committee or the Board of Directors, the amendment shall be subject to stockholder approval.


ARTICLE 12:00

Plan Subject to Governmental Laws and Regulations

12:01
The Plan and the grant and exercise of Options, Stock Appreciation Rights, and Limited Stock Appreciation Rights pursuant to the Plan shall be subject to all applicable governmental laws and regulations.  Notwithstanding any other provision of the Plan to the contrary, the Board of Directors may in its sole and absolute discretion make such changes in the Plan as may be required to conform the Plan to such laws and regulations.

 
 
11
 

 
ARTICLE 13:00

Duration of the Plan

13:01
No Option or Stock Appreciation Right shall be granted pursuant to the Plan after the close of business on April 29, 2013.
 
 
 
 12
Exhibit 23.1
 
 
 
CONSENT OF ERNST & YOUNG LLP
 
We consent to the incorporation by reference in the following Registration Statements of  Stanley Black & Decker, Inc. (formerly, The Stanley Works) of our report dated February 19, 2010, with respect to the consolidated financial statements and schedule of The Black & Decker Corporation and Subsidiaries which appear in their Annual Report on Form 10-K, included in this Current Report on Form 8-K of Stanley Black & Decker, Inc.
 
Registration Statement Number
 
Description
2-93025
Form S-8
2-96778
Form S-8
2-97283
Form S-8
33-16669
Form S-8
33-12853
Form S-3
33-19930
Form S-3
33-39553
Form S-8
33-46212
Form S-3
33-47889
Form S-3
33-55663
Form S-8
33-62565
Form S-8
33-62567
Form S-8
33-62575
Form S-8
333-42346
Form S-8
333-42582
Form S-8
333-64326
Form S-8
333-110279
Form S-3
333-117607
Form S-3
333-153646
Form S-3
333-162956
Form S-8
333-163509
Form S-4



 
 
 
 
       
 
 
   
/s/ Ermst & Young LLP      
Baltimore, Maryland       
March 12, 2010      
 
 
 
 
 
Exhibit 99.1
 
 
 
STANLEY BLACK & DECKER, INC.
CORPORATE GOVERNANCE GUIDELINES
AS ADOPTED BY THE BOARD OF DIRECTORS
 
Effective March 12, 2010
1.             Director Qualifications
 
The Board will have a majority of Directors who meet the criteria for independence required by the New York Stock Exchange. The Corporate Governance Committee is responsible for reviewing the qualifications and independence of the members of the Board and its various committees on a periodic basis as well as the composition of the Board as a whole. This assessment will include members’ qualification as independent, as well as consideration of diversity, age, skills, and experience in the context of the needs of the Board. Nominees for Directorship will be recommended to the Board by the Corporate Governance Committee in accordance with the policies and principles in its charter.
 
The Board presently has 15 members. The By-Laws of the Company provide that the Board shall consist of not less than nine nor more than 18 Directors.
 
It is the sense of the Board that individual Directors who change the principal occupation, position or responsibility they held when they were elected to the Board should volunteer to resign from the Board. It is not the sense of the Board that in every instance the Directors who retire or change from the position they held when they joined the Board should necessarily leave the Board. There should, however, be an opportunity for the Board through the Corporate Governance Committee to review the continued appropriateness of Board membership under the circumstances.
 
Directors should advise the Chairman of the Board and the Chairman of the Corporate Governance Committee in advance of accepting an invitation to serve on another public company board. Unless approved by the Board, a Director should not serve on more than four other public company boards.
 
The Board does not believe it should establish term limits. While term limits could help insure that there are fresh ideas and viewpoints available to the Board, they have the disadvantage of losing the contribution of Directors who have been able to develop, over a period of time, increasing insight into the Corporation and its operations and, therefore, provide an increasing contribution to the Board as a whole. Unless otherwise authorized by the Board, the retirement of a Director should normally occur at the end of the term in which he or she becomes 72 years of age.
 
2.             Director Responsibilities
 
The basic responsibility of the Directors is to exercise their business judgment in good faith and in what they reasonably believe to be in the best interests of the Corporation. In discharging that obligation, Directors should be entitled to rely on the honesty and integrity of their fellow Directors and the Corporation’s senior executives and outside advisors and auditors.
 
The Directors shall also be entitled to have the Corporation purchase reasonable Directors’ and Officers’ liability insurance on their behalf, and to the benefits of indemnification to the fullest extent permitted by law and the Corporation’s certificate of incorporation, by-laws and any indemnification agreements.
 
 
 
 
Directors are expected to attend Board meetings and meetings of committees on which they serve, and to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities. Information and data that are important to the Board’s understanding of the business to be conducted at a Board or committee meeting should generally be distributed in writing to the Directors before the meeting, and Directors should review these materials in advance of the meeting.
 
The Corporation’s current practice is to separate the offices of Chairman and the Chief Executive Officer. The Board believes, however, that the relationship between these offices is an issue that should be part of the succession planning process, which is overseen by the Compensation and Organization Committee, and that it is in the best interests of the Corporation for the Board to make a determination whether to combine these offices upon the  resignation or removal, or the election of a new Chairman or Chief Executive Officer and at such other times as the Board may deem appropriate.
 
The Chairman shall preside at all meetings of the Board, except that in the  Chairman’s absence, the Chief Executive Officer (if he shall be a Director) shall preside. In the absence of both the Chairman and the Chief Executive Officer (if the Chief Executive Officer shall be a Director), the Lead Independent Director shall preside. The Lead Independent Director shall  ensure that the views, opinions and suggestions of other independent Directors are adequately  brought to the attention of the Chairman and the Chief Executive Officer, and the Chairman and the  Chief Executive Officer, jointly with the Lead Independent Director, shall ensure that such views, opinions and suggestions are adequately addressed with the Board.
 
The Chairman, jointly with the Lead Independent Director and the Chief Executive  Officer shall determine the times and agendas of meetings of the Board. At the beginning of the year the Chairman, jointly with the Lead Independent Director and the Chief Executive Officer, shall  establish a schedule of meetings and agenda subjects to be discussed during the year (to the degree this can be foreseen). Each Board member is free to suggest the inclusion of items on the agenda. Each Board member is free to raise at any Board meeting subjects that are not on the agenda for that meeting. The Board will review the Corporation’s long-term strategic plans and the principal issues that the Corporation will face in the future during at least one Board meeting each year.
 
The non-management Directors will meet in executive session at each Board meeting.  If the Chairman shall be a management  Director, the Lead Independent Director will preside at these meetings.
 
The Board believes that the management speaks for the Corporation. Individual Board members may, from time to time, meet or otherwise communicate with various constituencies that are involved with the Corporation. But it is expected that Board members will do this only with the knowledge of the management and, absent unusual circumstances or as contemplated by the committee charters, only at the request of management.
 
 
 
2
 
 
 
3.             Board Committees
 
The Board will have at all times an Audit Committee, a Compensation and Organization Committee and a Corporate Governance Committee. All of the members of these committees will be independent Directors under the criteria established by the New York Stock Exchange. The Board will have additional standing and temporary committees as appropriate. In general, committee members will be appointed by the Board with consideration of the desires of individual Directors. It is the sense of the Board that consideration should be given to rotating committee members periodically, but the Board does not feel that a fixed rotation schedule should be mandated as a policy.
 
The Audit Committee, the Compensation and Organization Committee, the Corporate Governance Committee and other committees established by the Board will each have its own charter. The charters will set forth the purposes, goals and responsibilities of the committees as well as certain specific qualifications for committee membership and procedures for committee member appointment; in addition, the charters will address committee reporting to the Board. The charters will also provide that each committee annually evaluate its performance.
 
The chairman of each committee, in consultation with the committee members, will determine the frequency and length of the committee meetings consistent with any requirements set forth in the committee’s charter. The chairman of each committee, in consultation with the appropriate members of the committee and management, will develop the committee’s agenda. At the beginning of the year each committee will establish a schedule of agenda subjects to be discussed during the year (to the degree these can be foreseen). The schedule for each committee will be furnished to all Directors.
 
The Board and each committee have the power to hire at the expense of the Corporation independent legal, financial or other advisors as they may deem necessary without consulting or obtaining the approval of any officer of the Corporation in advance.
 
4.             Director Access to Officers and Employees
 
Directors have full and free access to officers and employees of the Corporation. Any meetings or contacts that a Director wishes to initiate may be arranged through the Chief Executive Officer or the Corporate Secretary or directly by the Director. The Directors will use their judgment to ensure that any such contact is not disruptive to the business operations of the Corporation and will, to the extent not inappropriate, copy the Chief Executive Officer on any written communications between a Director and an officer or employee of the Corporation.
 
The Board welcomes regular attendance at each Board meeting of the appropriate representatives of senior management of the Corporation as shall be determined from time to time, subject to the Board’s right in all instances to meet in executive session or with a more limited number of management representatives. If the Chief Executive Officer wishes to have additional Corporation personnel attendees on a regular basis, this suggestion should be brought to the Board for consideration.
 
 
 
3
 
 
5.             Director Compensation
 
The form and amount of Director compensation will be determined by the Corporate Governance Committee in accordance with the policies and principles set forth in its charter and any NYSE or other applicable rules, and that committee will conduct an annual review of Director compensation. The Corporate Governance Committee will consider that Directors’ independence may be jeopardized if Director compensation and perquisites exceed customary levels, if the Corporation makes substantial charitable contributions to organizations with which a Director is affiliated, or if the Corporation enters into consulting contracts with (or provides other indirect forms of compensation to) a Director or an organization with which the Director is affiliated.
 
6.             Director Orientation and Continuing Education
 
All new Directors must participate in the Corporation’s Orientation Program, which should be conducted within two months of the annual meeting at which new Directors are elected or as soon as reasonably practicable after a new Director otherwise joins the Board. This orientation will include presentations by senior management to familiarize new Directors with the Corporation’s strategic plans, its significant financial, accounting and risk management matters, its Code of Business Conduct and Ethics, its principal officers, and its internal and independent auditors. All continuing Directors will also be provided with ongoing training and education in respect of these and other subjects as determined, from time to time, by the Board.
 
7.             Chief Executive Officer Evaluation and Management Succession
 
The Compensation and Organization Committee will conduct an annual review of the Chief Executive Officer’s performance, as set forth in its charter. The Board of Directors will review the Compensation and Organization Committee’s report in order to confirm that the Chief Executive Officer is providing effective leadership for the Corporation in the long- and short-term. At the beginning of each year, the Chief Executive Officer should make recommendations to the Compensation and Organization Committee regarding his or her goals and objectives for the year. The Compensation and Organization Committee shall review and approve the Chief Executive Officer’s proposed goals and objectives, evaluate the Chief Executive Officer’s performance in light of those goals and objectives, and recommend to the Board of Directors the Chief Executive Officer’s overall compensation level based on this evaluation.
 
The Compensation and Organization Committee should periodically report to the Board on succession planning. The entire Board will work with the Compensation and Organization Committee to nominate and evaluate potential successors to the Chief Executive Officer. The Chief Executive Officer should at all times make available his or her recommendations and evaluations of potential successors, along with a review of any development plans recommended for such individuals.
 
8.            Annual Performance Evaluation
 
The Board of Directors will conduct an annual self-evaluation to determine whether it and its committees are functioning effectively. The Corporate Governance Committee will receive comments from all Directors and report annually to the Board with an assessment of the Board’s performance. This will be discussed with the full Board following the end of each fiscal year. The assessment will focus on the Board’s contribution to the Corporation and specifically focus on areas in which the Board or management believes that the Board could improve.
 
 
 
4 
Exhibit 99.2
 
 
 
 
 
FOR IMMEDIATE RELEASE
 
 
STANLEY AND BLACK & DECKER COMPLETE MERGER
 
 
New Britain, Connecticut, March 12, 2010 … The Stanley Works (NYSE: SWK) announced today that it has completed its merger with The Black & Decker Corporation (NYSE: BDK).
 
“We are extremely pleased to announce the combination of these two companies and are both prepared and excited for our future as Stanley Black & Decker,” said President and CEO John F. Lundgren. “We have made significant strides to this point in laying the foundation for a successful integration and feel certain we have the talent, experience and strategy to achieve our goals.”
 
The combined company will be known as Stanley Black & Decker. Under the merger agreement, each outstanding share of Black & Decker common stock will be converted into 1.275 shares of Stanley Works common stock. The existing Stanley Works shares will remain outstanding and will represent approximately 50.5% of the shares outstanding after the merger. The combined company will trade on the NYSE under the symbol “SWK”.
 
Stanley Black & Decker, an S&P 500 company, is a diversified global provider of hand tools, power tools and related accessories, mechanical access solutions and electronic security solutions, engineered fastening systems, and more. Learn more at www.stanleyblackanddecker.com .
 

 
Contact:
Kate White
 
 
Director, Investor Relations
 
 
kwhite@stanleyworks.com
 
 
(860) 827-3833
 

 
Exhibit 99.3
 
 
 
CONSOLIDATED STATEMENT OF EARNINGS
THE BLACK & DECKER CORPORATION AND SUBSIDIARIES
(DOLLARS IN MILLIONS EXCEPT PER SHARE DATA)
 
 

 
YEAR ENDED DECEMBER 31,
2009
 
2008
 
2007
 
SALES
 
$
4,775.1
   
$
6,086.1
   
$
6,563.2
 
    Cost of goods sold
   
3,188.6
     
4,087.7
     
4,336.2
 
    Selling, general, and administrative expenses
   
1,266.4
     
1,521.6
     
1,625.8
 
    Merger-related expenses
   
58.8
     
 —
     
 —
 
    Restructuring and exit costs
   
11.9
     
54.7
     
19.0
 
OPERATING INCOME
   
249.4
     
422.1
     
582.2
 
    Interest expense (net of interest income of
    $7.9 for 2009, $38.4 for 2008, and $19.8 for 2007)
   
83.8
     
62.4
     
82.3
 
Other (income) expense
   
(4.8
)
   
(5.0
) 
   
2.3
 
EARNINGS BEFORE INCOME TAXES
   
170.4
     
364.7
     
497.6
 
    Income taxes (benefit)
   
37.9
     
71.1
     
(20.5
)
NET EARNINGS
 
$
132.5
   
$
293.6
   
$
518.1
 
NET EARNINGS PER COMMON SHARE – BASIC
 
$
2.18
   
$
4.83
   
$
7.96
 
NET EARNINGS PER COMMON SHARE – ASSUMING DILUTION
 
$
2.17
   
$
4.77
   
$
7.78
 
 
 
See Notes to Consolidated Financial Statements.
 
 
 
1
 
 
 
CONSOLIDATED BALANCE SHEET
THE BLACK & DECKER CORPORATION AND SUBSIDIARIES
(MILLIONS OF DOLLARS)
 
 
DECEMBER 31,
2009
 
2008
 
ASSETS
           
Cash and cash equivalents
 
$
1,083.2
   
$
277.8
 
Trade receivables, less allowances of $45.8 for 2009 and $39.1 for 2008
   
832.8
     
924.6
 
Inventories
   
777.1
     
1,024.2
 
Other current assets
   
308.8
     
377.0
 
TOTAL CURRENT ASSETS
   
3,001.9
     
2,603.6
 
PROPERTY, PLANT, AND EQUIPMENT
   
473.4
     
527.9
 
GOODWILL
   
1,230.0
     
1,223.2
 
OTHER ASSETS
   
789.9
     
828.6
 
   
$
5,495.2
   
$
5,183.3
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
Short-term borrowings
 
$
—
   
$
83.3
 
Current maturities of long-term debt
   
—
     
.1
 
Trade accounts payable
   
403.2
     
453.1
 
Other current liabilities
   
792.7
     
947.4
 
TOTAL CURRENT LIABILITIES
   
1,195.9
     
1,483.9
 
LONG-TERM DEBT
   
1,715.0
     
1,444.7
 
POSTRESTIREMENT BENEFITS
   
760.4
     
669.4
 
OTHER LONG-TERM LIABILITIES
   
524.8
     
460.5
 
STOCKHOLDERS’ EQUITY
               
Common stock (outstanding: December 31, 2009 – 61,645,196 shares;
    December 31, 2008 – 60,092,726 shares)
   
30.8
     
30.0
 
Capital in excess of par value
   
119.1
     
14.3
 
Retained earnings
   
1,622.0
     
1,536.8
 
Accumulated other comprehensive income (loss)
   
(472.8
)    
(456.3
) 
TOTAL STOCKHOLDERS’ EQUITY
   
1,299.1
     
1,124.8
 
   
$
5,495.2
   
$
5,183.3
 
 
See Notes to Consolidated Financial Statements.

 
 
 
 
2
 
 
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
THE BLACK & DECKER CORPORATION AND SUBSIDIARIES
(DOLLARS IN MILLIONS EXCEPT PER SHARE DATA)
 
 
 
OUTSTANDING
  COMMON
  SHARES
 
PAR
  VALUE
 
  CAPITAL IN
  EXCESS OF
  PAR VALUE
  RETAINED
  EARNINGS
 
ACCUMULATED
  OTHER
  COMPREHENSIVE
  INCOME (LOSS)
 
TOTAL
  STOCKHOLDERS’
  EQUITY
 
BALANCE AT DECEMBER 31, 2006
66,734,843
 
$
33.4
 
$
—
 
$
1,473.0
   
$
(342.8
)
 
$
1,163.6
 
Comprehensive income (loss):
                                     
    Net earnings
—
   
—
   
—
   
518.1
     
—
     
518.1
 
    Net loss on derivative instruments (net of tax)
—
   
—
   
—
   
—
     
(25.4
)
   
(25.4
)
    Minimum pension liability adjustment (net of tax)
—
   
—
   
—
   
—
     
161.0
     
161.0
 
    Foreign currency translation adjustments, less effect
       of hedging activities (net of tax)
—
   
—
   
—
   
—
     
83.2
     
83.2
 
    Amortization of actuarial losses and prior service cost
        (net of tax)
—
   
 —
   
 —
   
 —
     
25.7
     
25.7
 
Comprehensive income
—
   
—
   
—
   
518.1
     
244.5
     
762.6
 
Cumulative effect of adopting the new accounting
    standard relating to uncertain tax positions
—
   
—
   
—
   
(7.3
)    
—
     
(7.3
)
Cash dividends on common stock ($1.68 per share)
—
   
—
   
—
   
(108.6
)
   
—
     
(108.6
)
Common stock issued under stock-based plans (net of
    forfeitures)
1,666,123
   
.8
   
109.0
   
—
     
—
     
109.8
 
Purchase and retirement of common stock
(5,477,243
)
 
(2.7
)
 
(82.0
)
 
(376.7
)
   
—
     
(461.4
)
BALANCE AT DECEMBER 31, 2007
62,923,723
   
31.5
   
27.0
   
1,498.5
     
(98.3
)
   
1,458.7
 
Comprehensive income (loss):
                                     
    Net earnings
—
   
—
   
—
   
293.6
     
—
     
293.6
 
    Net gain on derivative instruments (net of tax)
—
   
—
   
—
   
—
     
83.5
     
83.5
 
    Minimum pension liability adjustment (net of tax)
—
   
—
   
—
   
—
     
(284.2
) 
   
(284.2
)
    Foreign currency translation adjustments, less effect
        of hedging activities (net of tax)
—
   
—
   
—
   
—
     
(172.1
) 
   
(172.1
)
Amortization of actuarial losses and prior service cost
    (net of tax)
—
   
—
   
—
   
—
     
14.8
     
14.8
 
Comprehensive income (loss)
—
   
—
   
—
   
293.6
     
(358.0
)
   
(64.4
)
Adoption of new accounting standard requiring a year-
    end measurement date for defined benefit pension and
    other postretirement benefit plans (net of tax)
—
   
—
   
—
   
(5.1
)
   
—
     
(5.1
)
Cash dividends on common stock ($1.68 per share)
—
   
—
   
—
   
(101.8
)
   
—
     
(101.8
)
Common stock issued under stock-based plans (net of
    forfeitures)
305,647
   
.1
   
39.6
   
—
     
—
     
39.7
 
Purchase and retirement of common stock
(3,136,644
)
 
(1.6
)
 
(52.3
)
 
(148.4
)
   
—
     
(202.3
)
BALANCE AT DECEMBER 31, 2008
60,092,726
   
30.0
   
14.3
   
1,536.8
     
(456.3
)
   
1,124.8
 
Comprehensive income (loss):
                                     
    Net earnings
—
   
—
   
—
   
132.5
     
—
     
132.5
 
    Net loss on derivative instruments (net of tax)
—
   
—
   
—
   
—
     
(53.4
)
   
(53.4
) 
    Minimum pension liability adjustment (net of tax)
—
   
—
   
—
   
—
     
(66.8
)
   
(66.8
)
    Foreign currency translation adjustments, less effect
        of hedging activities (net of tax)
—
   
—
   
—
   
—
     
88.4
     
88.4
 
    Amortization of actuarial losses and prior service cost
        (net of tax)
—
   
—
   
—
   
—
     
15.3
     
15.3
 
Comprehensive income (loss)
—
   
—
   
—
   
132.5
     
(16.5
)
   
116.0
 
Cash dividends on common stock ($.78 per share)
—
   
—
   
—
   
(47.3
)
   
—
     
(47.3
)
Common stock issued under stock-based plans (net of
    forfeitures)
1,799,668
   
.9
   
118.1
   
—
     
—
     
119.0
 
Purchase and retirement of common stock
(247,198
)
 
(.1
)
 
(13.3
)
 
—
     
—
     
(13.4
)
BALANCE AT DECEMBER 31, 2009
61,645,196
 
$
30.8
 
$
119.1
 
$
1,622.0
   
$
(472.8
)
 
$
1,299.1
 
 
See Notes to Consolidated Financial Statements.
 
 
 
 
3
 
CONSOLIDATED STATEMENT OF CASH FLOWS
THE BLACK & DECKER CORPORATION AND SUBSIDIARIES
(MILLIONS OF DOLLARS)
 
 
 
YEAR ENDED DECEMBER 31,
2009
 
2008
 
2007
 
OPERATING ACTIVITIES
                 
Net earnings
 
$
132.5
   
$
293.6
   
 $
518.1
 
Adjustments to reconcile net earnings to cash flow from operating activities:
                       
    Non-cash charges and credits:
                       
        Depreciation and amortization
   
128.0
     
136.6
     
143.4
 
        Stock-based compensation
   
69.8
     
29.1
     
25.9
 
        Amortization of actuarial losses and prior service costs
   
15.3
     
14.8
     
25.7
 
        Settlement of income tax litigation
   
—
     
—
     
(153.4
)
        Restructuring and exit costs
   
11.9
     
54.7
     
19.0
 
       Other
   
(7.5
)
   
.3
     
.5
 
Changes in selected working capital items
       (net of effects of businesses acquired):
                       
        Trade receivables
   
127.2
     
132.5
     
99.4
 
         Inventories
   
273.3
     
67.9
     
(32.0
) 
        Trade accounts payable
   
(53.1
)
   
(47.9
) 
   
32.6
 
        Other current liabilities
   
(102.2
)
   
(141.8
)
   
33.3
 
    Restructuring spending
   
(39.8
)
   
(25.3
)
   
(1.0
)
    Other assets and liabilities
   
(69.8
)
   
(89.1
)
   
14.4
 
    CASH FLOW FROM OPERATING ACTIVITIES
   
485.6
     
425.4
     
725.9
 
INVESTING ACTIVITIES
                       
Capital expenditures
   
(63.1
)
   
(98.8
)
   
(116.4
)
Proceeds from disposal of assets
   
3.2
     
20.4
     
13.0
 
Purchase of businesses, net of cash acquired
   
—
     
(25.7
)
   
—
 
Cash outflow associated with purchase of previously acquired business
   
(1.4
) 
   
—
     
—
 
Cash inflow from hedging activities
   
196.0
     
72.4
     
2.0
 
Cash outflow from hedging activities
   
(38.2
)
   
(29.7
)
   
(47.4
)
Other investing activities, net
   
—
     
—
     
(1.0
) 
    CASH FLOW FROM INVESTING ACTIVITIES
   
96.5
     
(61.4
)
   
(149.8
)
FINANCING ACTIVITIES
                       
Net (decrease) increase in short-term borrowings
   
(84.3
)
   
(246.0
)
   
68.8
 
Proceeds from issuance of long-term debt (net of debt issue costs of $2.7 for 2009 and $.3 for 2008)
   
343.1
     
224.7
     
—
 
Payments on long-term debt
   
(50.1
)
   
(.2
)
   
(150.3
)
Purchase of common stock
   
(13.4
)
   
(202.3
)
   
(461.4
)
Issuance of common stock
   
62.6
     
8.6
     
83.3
 
Cash dividends
   
(47.3
)
   
(101.8
)
   
(108.6
)
    CASH FLOW FROM FINANCING ACTIVITIES
   
210.6
     
(317.0
)
   
(568.2
)
Effect of exchange rate changes on cash
   
12.7
     
(23.9
)
   
13.5
 
INCREASE IN CASH AND CASH EQUIVALENTS
   
805.4
     
23.1
     
21.4
 
Cash and cash equivalents at beginning of year
   
277.8
     
254.7
     
233.3
 
CASH AND CASH EQUIVALENTS AT END OF YEAR
 
$
1,083.2
   
$
277.8
   
$
254.7
 
 
See Notes to Consolidated Financial Statements.
 
 
 
 
4
 

 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THE BLACK & DECKER CORPORATION AND SUBSIDIARIES
 
 
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Principles of Consolidation:   The Consolidated Financial Statements include the accounts of the Corporation and its subsidiaries. Intercompany transactions have been eliminated.
 
Reclassifications: Certain prior years’ amounts in the Consolidated Financial Statements have been reclassified to conform to the presentation used in 2009.
 
Use of Estimates:   The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results inevitably will differ from those estimates, and such differences may be material to the financial statements.
 
Revenue Recognition:   Revenue from sales of products is recognized when title passes, which occurs either upon shipment or upon delivery based upon contractual terms. The Corporation recognizes customer program costs, including customer incentives such as volume or trade discounts, cooperative advertising and other sales related discounts, as a reduction to sales.
 
Foreign Currency Translation:   The financial statements of subsidiaries located outside of the United States, except those subsidiaries operating in highly inflationary economies, generally are measured using the local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at the rates of exchange at the balance sheet date. The resultant translation adjustments are included in accumulated other comprehensive income (loss), a separate component of stockholders’ equity. Income and expense items are translated at average monthly rates of exchange. Gains and losses from foreign currency transactions of these subsidiaries are included in net earnings. For subsidiaries operating in highly inflationary economies, gains and losses from balance sheet translation adjustments are included in net earnings.
 
Cash and Cash Equivalents:   Cash and cash equivalents include cash on hand, demand deposits, and short-term investments with maturities of three months or less from the date of acquisition.
 
Concentration of Credit:   The Corporation sells products to customers in diversified industries and geographic regions and, therefore, has no significant concentrations of credit risk other than with two major customers. As of December 31, 2009, approximately 27% of the Corporation’s trade receivables were due from two large home improvement retailers.
 
The Corporation continuously evaluates the credit-worthiness of its customers and generally does not require collateral.
 
Inventories: Inventories are stated at the lower of cost or market. The cost of United States inventories is based primarily on the last-in, first-out (LIFO) method; all other inventories are based on the first-in, first-out (FIFO) method.
 
Property and Depreciation:   Property, plant, and equipment is stated at cost. Depreciation is computed generally on the straight-line method. Estimated useful lives range from 10 years to 50 years for buildings and 3 years to 15 years for machinery and equipment. The Corporation capitalizes improvements that extend the useful life of an asset. Repair and maintenance costs are expensed as incurred.
 
Goodwill and Other Intangible Assets:   Goodwill represents the excess of the cost of an acquired entity over the net of the amounts assigned to assets acquired and liabilities assumed. Goodwill and intangible assets deemed to have indefinite lives are not amortized, but are subject to an impairment test on an annual basis, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Other intangible assets are amortized over their estimated useful lives.
 
The Corporation assesses the fair value of its reporting units for its goodwill impairment tests based upon a discounted cash flow methodology. The identification of reporting units begins at the operating segment level – in the Corporation’s case, the Power Tools and Accessories segment, the Hardware and Home Improvement segment, and the Fastening and Assembly Systems segment – and considers whether operating components one level below the segment level should be identified as reporting units for purposes of goodwill impairment tests if certain conditions exists. The conditions include, among other factors, (i) the extent to which an operating component represents a business (that is, the operating component contains all of the inputs and processes necessary for it to continue to conduct normal operations if transferred from the segment) and (ii) the disaggregation of economically dissimilar operating components within a segment. The Corporation has determined that its reporting units, for purposes of its goodwill impairment tests, represent its operating segments, except with respect to its Hardware and Home Improvement segment for which its reporting units are the plumbing products and security hardware businesses. Goodwill is allocated to each reporting unit at the time of a business acquisition and is adjusted upon finalization of the purchase price of an acquisition.
 
 
 
 
5
 
 
 
The discounted cash flow methodology utilized by the Corporation to assess the fair value of its reporting units for its goodwill impairment tests is based upon estimated future cash flows – which are based upon historical results and current projections – and are  discounted at a rate corresponding to a market rate. If the carrying amount of the reporting unit exceeds the estimated fair value determined through that discounted cash flow methodology, goodwill impairment may be present. The Corporation would measure the goodwill impairment loss based upon the fair value of the reporting unit, including any unrecognized intangible assets, and estimate the implied fair value of goodwill. An impairment loss would be recognized to the extent that a reporting unit’s recorded goodwill exceeded the implied fair value of goodwill.
 
The Corporation performed its annual impairment test in the fourth quarters of 2009, 2008, and 2007. No impairment was present upon performing these impairment tests. The Corporation cannot predict the occurrence of certain events that might adversely affect the reported value of goodwill. Such events may include, but are not limited to, strategic decisions made in response to economic and competitive conditions, the impact of the economic environment on the Corporation’s customer base, or a material negative change in its relationships with significant customers.
 
Product Development Costs: Costs associated with the development of new products and changes to existing products are charged to operations as incurred. Product development costs were $127.8 million in 2009, $146.0 million in 2008, and $150.9 million in 2007.
 
Shipping and Handling Costs:   Shipping and handling costs represent costs associated with shipping products to customers and handling finished goods. Included in selling, general, and administrative expenses are shipping and handling costs of $240.0 million in 2009, $315.1 million in 2008, and $340.6 million in 2007. Freight charged to customers is recorded as revenue.
 
Advertising and Promotion:   Advertising and promotion expense, which is expensed as incurred, was $114.9 million in 2009, $162.6 million in 2008, and $199.2 million in 2007.
 
Product Warranties:   Most of the Corporation’s products in the Power Tools and Accessories segment and Hardware and Home Improvement segment carry a product warranty. That product warranty, in the United States, generally provides that customers can return a defective product during the specified warranty period following purchase in exchange for a replacement product or repair at no cost to the consumer. Product warranty arrangements outside the United States vary depending upon local market conditions and laws and regulations. The Corporation accrues an estimate of its exposure to warranty claims based upon both current and historical product sales data and warranty costs incurred.
 
Stock-Based Compensation:   The Corporation recognizes stock-based compensation expense – the cost of employee services in exchange for awards of equity instruments – based on the grant-date fair value of those awards. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the award, which is generally the vesting period. Stock-based compensation expense is reflected in the Consolidated Statement of Earnings in selling, general, and administrative expenses. The fair value of stock options is determined using the Black-Scholes option valuation model, which incorporates assumptions surrounding expected volatility, dividend yield, the risk-free interest rate, expected option life, and the exercise price compared to the stock price on the grant date. The volatility assumptions utilized in determining the fair value of stock options granted after 2005, are based upon the average of historical and implied volatility. The volatility assumptions utilized in determining the fair value of stock options granted before 2005, are based upon historical volatility. The Corporation determined the estimated expected life of options based on a weighted average of the average period of time from grant date to exercise date, the average period of time from grant date to cancellation date after vesting, and the mid-point of time to expiration for outstanding vested options. The Corporation determines the fair value of the Corporation’s restricted stock and restricted stock units based on the fair value of its common stock at the date of grant.
 
Cash flows resulting from the tax benefits of tax deductions in excess of the compensation cost recognized for share-based arrangements are classified as financing cash flows.
 
Postretirement Benefits: Pension plans, which cover substantially all of the Corporation’s employees in North America (if hired before 2007), the United Kingdom (if hired before 2005), and Europe consist primarily of non-contributory defined benefit plans. The defined benefit plans are funded in conformity with the funding requirements of applicable government regulations. Generally, benefits are based on age, years of service, and the level of compensation during the final years of employment. Prior service costs for defined benefit plans generally are amortized over the estimated remaining service periods of employees.
 
Certain employees are covered by defined contribution plans. The Corporation’s contributions to these plans are generally based on a percentage of employee compensation or employee contributions. These plans are funded on a current basis.
 
In addition to pension benefits, certain postretirement medical, dental, and life insurance benefits are provided to most United States retirees who retired before 1994. Most current United States employees (if hired before 2005) are eligible for postretirement medical and dental benefits from their date of retirement to age 65. The postretirement medical benefits are contributory and include certain cost-sharing features, such as deductibles and co-payments. Retirees in other countries generally are covered by government-sponsored programs.
 
 
 
6
 
 
 
 
The Corporation recognizes the overfunded or underfunded status of its defined benefit postretirement plans as an asset or a liability in the balance sheet, with changes in the funded status recorded through comprehensive income in the year in which those changes occur.
 
Effective December 31, 2008, the Corporation adopted a new accounting standard that requires the funded status be measured as of an entity’s year-end balance sheet date rather than as of an earlier date as previously permitted. Prior to December 31, 2008, the Corporation used a measurement date of September 30 for the majority of its defined benefit pension and postretirement plans. Effective December 31, 2008, the Corporation uses a measurement date of December 31 for its defined benefit pension and postretirement plans. The adoption of the year-end measurement date requirement of as of December 31, 2008, resulted in a charge to retained earnings of $5.1 million, an increase in deferred tax assets of $.7 million, an increase in pension assets of $.6 million, an increase in pension liabilities of $3.2 million, and an increase in accumulated other comprehensive income of $3.2 million.
 
The expected return on plan assets is determined using the expected rate of return and a calculated value of plan assets referred to as the market-related value of plan assets. Differences between assumed and actual returns are amortized to the market-related value of assets on a straight-line basis over five years.
 
The Corporation uses the corridor approach in the valuation of defined benefit plans and other postretirement benefits. The corridor approach defers all actuarial gains and losses resulting from variances between actual results and economic estimates or actuarial assumptions. For defined benefit pension plans, these unrecognized gains and losses are amortized when the net gains and losses exceed 10% of the greater of the market-related value of plan assets or the projected benefit obligation at the beginning of the year. For other postretirement benefits, amortization occurs when the net gains and losses exceed 10% of the accumulated postretirement benefit obligation at the beginning of the year. The amount in excess of the corridor is amortized over the average remaining service period to retirement date of active plan participants or, for retired participants, the average remaining life expectancy.
 
Environmental Liabilities:   The Corporation accrues for its environmental remediation costs, including costs of required investigation, remedial activities, and post-remediation operating and maintenance, when it is probable that a liability has been incurred and the amount can be reasonably estimated. For matters associated with properties currently operated by the Corporation, the Corporation makes an assessment as to whether an investigation and remediation would be required under applicable federal and state laws. For matters associated with properties previously sold or operated by the Corporation, the Corporation considers any applicable terms of sale and applicable federal and state laws to determine if it has any remaining liability. For environmental remediation matters, the most likely cost to be incurred is accrued based on an evaluation of currently available facts with respect to each individual site, including current laws and regulations, remedial activities under consideration, and prior remediation experience. Where no amount within a range of estimates is considered by the Corporation as more likely to occur than another, the minimum amount is accrued. In establishing an accrual for environmental remediation costs at sites with multiple potentially responsible parties, the Corporation considers its likely proportionate share of the anticipated remediation costs and the ability of other parties to fulfill their obligations. Environmental liabilities are not discounted. When future liabilities are determined to be reimbursable by insurance coverage, a receivable is recorded related to the insurance reimbursement when reimbursement is virtually certain. As more fully disclosed in Note 21, the uncertain nature inherent in estimating the costs of such environmental remediation and the possibility that current estimates may not reflect the final outcome could result in the recognition of additional expenses in future periods.
 
Derivative Financial Instruments:   The Corporation is exposed to certain market risks arising from its business operations. With products and services marketed in over 100 countries and with manufacturing sites in 12 countries, the Corporation is exposed to risks arising from changes in foreign currency rates. Also, the materials used in the manufacturing of the Corporation’s products, which include certain components and raw materials, are subject to price volatility. These component parts and raw materials are principally subject to market risk associated with changes in the price of nickel, steel, resins, copper, aluminum, and zinc. The Corporation is also exposed to market risks associated with changes in interest rates. The primary risks managed by derivative instruments are foreign currency exchange risk, commodity price risk, and interest rate risk. The Corporation also manages each of these risks using methods other than derivative instruments. The Corporation does not utilize derivatives that contain leverage features.
 
Derivative instruments are recognized as either assets or liabilities in the Consolidated Balance Sheet at fair value. On the date on which the Corporation enters into a derivative, the derivative is generally designated as a hedge of the identified exposure. The Corporation formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedge transactions. In this documentation, the Corporation specifically identifies the asset, liability, firm commitment, forecasted transaction, or net investment that has been designated as the hedged item and states how the hedging instrument is expected to reduce the risks related to the hedged item.  The Corporation measures effectiveness of its hedging relationships both at hedge inception and on an ongoing basis. The Corporation enters into certain derivatives that are not designated as a hedge of the identified exposures; however, these derivatives are believed to be hedges of the underlying economic exposure.
 
 
 
7
 
 
 
Cash Flow Hedging Strategy. For each derivative instrument that is designated and qualifies as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any, is recognized in current earnings during the period of change. For hedged forecasted transactions, hedge accounting is discontinued if the forecasted transaction is no longer probable of occurring, in which case previously deferred hedging gains or losses would be recorded to earnings immediately.
 
The fair value of foreign currency-related derivatives are generally included in the Consolidated Balance Sheet in other current assets, other assets, other current liabilities, and other long-term liabilities. The earnings impact of cash flow hedges relating to forecasted purchases of inventory is reported in cost of goods sold to match the underlying transaction being hedged.
 
The earnings impact of cash flow hedges relating to the variability in cash flows associated with foreign currency-denominated assets and liabilities is reported in cost of goods sold, selling, general, and administrative expenses, or other expense (income), depending on the nature of the assets or liabilities being hedged. The amounts deferred in accumulated other comprehensive income (loss) associated with these instruments generally relate to foreign currency spot-rate to forward-rate differentials and are recognized in earnings over the term of the hedge. The discount or premium relating to cash flow hedges associated with foreign currency-denominated assets and liabilities is recognized in net interest expense over the life of the hedge.
 
Forward contracts on various foreign currencies are entered into to manage the foreign currency exchange risk associated with forecasted sale or purchase of product manufactured in a currency different than that of the selling subsidiary. The objective of the hedges is to reduce the variability of cash flows associated with the receipt or payment of those foreign currency risks. When the functional currency of the selling subsidiary weakens against the exposed currency, the increase in the present value of the future foreign currency cash flow associated with the purchase of product is offset by gains in the fair value of the forward contract designated as hedged. Conversely, when the functional currency of the selling subsidiary strengthens against the exposed currency, the decrease in the present value of the future foreign currency cash flow associated with the purchase of product is offset by losses in the fair value of the forward contract designated as hedged. The Corporation may also manage this foreign currency exchange risk through the use of options. No options to buy or sell currencies were outstanding at December 31, 2009.
 
The following table summarizes the contractual amounts of forward exchange contracts as of December 31, 2009 and 2008, in millions of dollars, which were entered into to hedge forecasted purchases, including details by major currency as of December 31, 2009. Foreign currency amounts were translated at current rates as of the reporting date. The “Buy” amounts represent the United States dollar equivalent of commitments to purchase currencies, and the “Sell” amounts represent the United States dollar equivalent of commitments to sell currencies.
 
AS OF DECEMBER 31, 2009
BUY
 
SELL
 
United States dollar
 
$
243.9
   
$
(6.9
)
Pound sterling
   
—
     
(35.1
)
Euro
   
60.6
     
(163.5
)
Canadian dollar
   
—
     
(77.3
)
Australian dollar
   
—
     
(13.3
)
Czech koruna
   
14.9
     
—
 
Swedish krona
   
—
     
(13.2
)
Norwegian krone
   
—
     
(8.1
)
Other
   
7.4
     
(12.7
)
Total
 
$
326.8
   
$
(330.1
)
                 
AS OF DECEMBER 31, 2008
               
Total
 
$
583.2
   
$
(518.3
)
 
Forward contracts on various foreign currencies are also entered into to manage the foreign currency exchange risk associated with foreign currency denominated assets, liabilities, and firm commitments. The objective of the hedges is to reduce the variability of cash flows associated with the receipt or payment of those foreign currency risks. When the functional currency of the selling subsidiary weakens against the exposed currency, the increase in the present value of the future foreign currency cash flow associated with the future receipt or payment of the foreign currency denominated asset or liability is offset by gains in the fair value of the forward contract designated as hedged. Conversely, when the functional currency of the selling subsidiary strengthens against the exposed currency, the decrease in the future receipt or payment of the foreign currency denominated asset or liability is offset by losses in the fair value of the forward contract designated as hedged.
 
 
 
 
8
 
 
 
The following table summarizes the contractual amounts of forward exchange contracts as of December 31, 2009 and 2008, in millions of dollars, which were entered into to hedge foreign currency denominated assets, liabilities, and firm commitments, including details by major currency as of December 31, 2009. Foreign currency amounts were translated at current rates as of the reporting date. The “Buy” amounts represent the United States dollar equivalent of commitments to purchase currencies, and the “Sell” amounts represent the United States dollar equivalent of commitments to sell currencies.
 
AS OF DECEMBER 31, 2009
BUY
 
SELL
 
United States dollar
 
$
1,425.1
   
$
(2,863.8
)
Pound sterling
   
1,838.4
     
(537.7
)
Euro
   
1,009.9
     
(750.2
)
Canadian dollar
   
22.9
     
(64.5
)
Czech koruna
   
 —
     
(5.1
) 
Japanese yen
   
—
     
(31.4
)
Swedish krona
   
95.0
     
(73.7
)
New Zealand dollar
   
 22.5
     
 (11.2
)
Swiss franc
   
1.2
     
(16.9
)
Norwegian krone
   
—
     
(4.4
)
Danish krone
   
.8
     
(34.3
)
Other
   
5.6
     
(25.1
)
Total
 
$
4,421.4
   
$
(4,418.3
)
                 
AS OF DECEMBER 31, 2008
               
Total
 
$
2,261.4
   
$
(2,434.2
)
 
The Corporation’s foreign currency derivatives are designated to, and generally are denominated in the currencies of, the underlying exposures. Some of the forward exchange contracts involve the exchange of two foreign currencies according to the local needs of the subsidiaries. Some natural hedges also are used to mitigate risks associated with transaction and forecasted exposures. The Corporation also responds to foreign exchange movements through various means, such as pricing actions, changes in cost structure, and changes in hedging strategies.
 
The Corporation has entered into forward contracts on certain commodities – principally zinc and copper – to manage the price risk associated with the forecasted purchases of materials used in the manufacturing of the Corporation’s products. The objective of the hedge is to reduce the variability of cash flows associated with the forecasted purchase of those commodities. The Corporation had the following notional amounts of commodity contracts outstanding (in millions of pounds).
 
AS OF DECEMBER 31,
 
2009
   
2008
 
Zinc
   
7.3
     
13.7
 
Copper
   
1.6
     
3.3
 
 
Fair Value Hedging Strategy. For each derivative instrument that is designated and qualifies as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in the same line item associated with the hedged item in current earnings during the period of the change in fair values. The Corporation manages its interest rate risk, primarily through the use of interest rate swap agreements, in order to achieve a cost-effective mix of fixed and variable rate indebtedness. It seeks to issue debt opportunistically, whether at fixed or variable rates, at the lowest possible costs. The Corporation may, based upon its assessment of the future interest rate environment, elect to manage its interest rate risk associated with changes in the fair value of its indebtedness through the use of interest rate swaps. The interest rate swap agreements utilized by the Corporation effectively modify the Corporation’s exposure to interest rates by converting the Corporation’s fixed-rate debt, to the extent it has been swapped, to a floating rate. The Corporation has designated each of its outstanding interest rate swap agreements as fair value hedges of the underlying fixed rate obligation. The fair value of the interest rate swap agreements is recorded in other current assets, other assets, other current liabilities, or other long-term liabilities with a corresponding increase or decrease in the fixed rate obligation. The changes in the fair value of the interest rate swap agreements and the underlying fixed rate obligations are recorded as equal and offsetting unrealized gains and losses in interest expense in the Consolidated Statement of Earnings. Gains or losses resulting from the early termination of interest rate swaps are deferred as an increase or decrease to the carrying value of the related debt and amortized as an adjustment to the yield of the related debt instrument over the remaining period originally covered by the swap.
 
As of December 31, 2009 and 2008, the total notional amount of the Corporation’s portfolio of fixed-to-variable interest rate swap instruments was $325.0 million, respectively.
 
Net Investment Hedging Strategy. For derivatives that are designated and qualify as hedges of net investments in subsidiaries located outside the United States, the gain or loss (net of tax) is reported in accumulated other comprehensive income (loss) as part of the cumulative translation adjustment to the extent the derivative is effective. Any ineffective portion of net investment hedges are recognized in current earnings. Amounts due from or to counterparties are included in other current assets or other current liabilities. The objective of the hedge is to protect the value of the Corporation’s investment in its foreign subsidiaries.
 
As of December 31, 2009 and 2008, the total notional amount of the Corporation’s net investment hedges consisted of contracts to sell the British Pound Sterling in the amount of £753.2 million and £383.8 million, respectively.
 
Other Hedging Strategy. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in current earnings during the period of change. The notional amounts of derivative instruments not designated as hedging instruments at December 31, 2009 and 2008, were not material.
 
Credit Exposure.  The Corporation is exposed to credit-related losses in the event of nonperformance by counterparties to certain derivative financial instruments. The Corporation monitors the creditworthiness of the counterparties and presently does not expect default by any of the counterparties. The Corporation does not obtain collateral in connection with its derivative financial instruments.
 
 
 
9
 
 
 
The credit exposure that results from interest rate and foreign exchange contracts is the fair value of contracts with a positive fair value as of the reporting date. Some derivatives are not subject to credit exposures. The fair value of all financial instruments is summarized in Note 11.
 
Fair Value Measurements: Effective January 1, 2008, the Corporation adopted a new accounting standard that defined fair value, established a framework for measuring fair value, and expanded disclosures about fair value measurements. This standard clarified how to measure fair value as permitted under other accounting pronouncements but did not require any new fair value measurements. In February 2008, the FASB adopted a one-year deferral of the fair value measurement and disclosure requirements for non-financial assets and liabilities, except for those that are recognized and disclosed at fair value in the financial statements on at least an annual basis.
 
The Corporation adopted the fair value measurement and disclosure requirements for measuring financial assets and liabilities and non-financial assets and liabilities that are recognized at fair value in the financial statements on at least an annual basis as of January 1, 2008. The Corporation adopted the fair value measurement and disclosure requirements for non-financial assets and liabilities as of January 1, 2009.
 
The fair value accounting standard defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. That fair value accounting standard also establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
 
•      Level 1 – Quoted prices in active markets for identical assets or liabilities.
 
•      Level 2 – Observable inputs other than quoted market prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
 
•      Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
 
Income Taxes:   The provision for income taxes is determined using the asset and liability approach. Under this approach, deferred income taxes represent the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities. Valuation allowances are recorded to reduce the deferred tax assets to an amount that will more likely than not be realized. No provision is made for the U.S. income taxes on the undistributed earnings of wholly-owned foreign subsidiaries as substantially all such earnings are permanently reinvested, or will only be repatriated when possible to do so at minimal additional tax cost.
 
Effective January 1, 2007, the Corporation adopted a new accounting standard that provided guidance for the recognition, derecognition and measurement in financial statements of tax positions taken in previously filed tax returns or tax positions expected to be taken in tax returns. The Corporation recognizes the financial statement impact of a tax position when it is more likely than not that the position will be sustained upon examination. If the tax position meets the more-likely-than-not recognition threshold, the tax effect is recognized at the largest amount of the benefit that is greater than fifty percent likely of being realized upon ultimate settlement. The Corporation recognizes a liability created for unrecognized tax benefits as a separate liability that is not combined with deferred tax liabilities or assets. The Corporation recognizes interest and penalties related to tax uncertainties as income tax expense. The impact of the adoption of that new accounting standard for tax positions is more fully disclosed in Note 12.
 
Earnings per Share:   The Corporation calculates basic net earnings per share using the weighted-average number of common shares outstanding during the period. Diluted net earnings per share is computed using the weighted-average number of common shares and dilutive potential commons shares outstanding during the period. Dilutive potenital common shares, which primarily consist of stock options, restricted stock and restricted stock units, are determined under the treasury stock method.
 
Effective January 1, 2009, the Corporation adopted a new accounting standard that clarifies whether instruments grated in share-based payment transactions should be included in the computation of earnings per share using the two-class method prior to vesting. See Note 15 for application of the two-class method to the Corporation’s share-based plans. The new accounting standard requires that all prior-period earnings per share presented be adjusted retrospectively. Accordingly, basic and diluted earnings per share for the year ended December 31, 2008, have been adjusted to $4.83 and $4.77, respectively, from $4.91 and $4.82, respectively. Basic and diluted earnings per share for the year ended December 31, 2007, have been adjusted to $7.96 and $7.78, respectively, from $8.06 and $7.85, respectively.
 
Subsequent Events:   The Corporation has evaluated subsequent events through February 19, 2010, the date of issuance of these financial statements, and determined that: (i) no subsequent events have occurred that would require recognition in its consolidated financial statements for the year ended December 31, 2009; and (ii) no other subsequent events have occurred that would require disclosure in the notes thereto.
 
 
 
10
 
 
 
NOTE 2: DEFINITIVE MERGER AGREEMENT
 
On November 2, 2009, the Corporation announced that it had entered into a definitive merger agreement to create Stanley Black & Decker, Inc. in an all-stock transaction. Under the terms of the transaction, which has been approved by the Boards of Directors of both the Corporation and The Stanley Works, the Corporation’s shareholders will receive a fixed ratio of 1.275 shares of The Stanley Works common stock for each share of the Corporation’s common stock that they own. Consummation of the transaction is subject to customary closing conditions, including obtaining certain regulatory approvals as well as shareholder approval from the shareholders of both the Corporation and The Stanley Works.
 
On December 29, 2009, the Corporation announced that the Hart-Scott-Rodino antitrust review period had expired. The expiration of the Hart-Scott-Rodino antitrust review period satisfies one of the conditions to the closing of the transaction. On February 2, 2010, the Corporation and The Stanley Works announced that both companies will hold special shareholder meetings on March 12, 2010, to vote on the combination of their businesses. In connection with the proposed transaction, The Stanley Works has filed with the Securities and Exchange Commission (SEC) a Registration Statement on Form S-4 (File No. 333-163509) that includes a joint proxy statement of Stanley and the Corporation that also constitutes a prospectus of Stanley. The joint proxy statement of both the Corporation and The Stanley Works was mailed to shareholders commencing on or about Febuary 4, 2010. Investors and security holders are urged to read the joint proxy statement/prospectus and any other relevant documents filed with the SEC because they contain important information. The Corporation and The Stanley Works expect that closing of the proposed transaction will occur on March 12, 2010.
 
The provisions of the definitive merger agreement provide for a termination fee, in the amount of $125 million, to be paid by either the Corporation or by The Stanley Works under certain circumstances, including circumstances in which the Board of Directors of The Stanley Works or the Corporation withdraw or modify adversely their recommendation of the proposed transaction.
 
The Corporation recognized merger-related expenses of $58.8 million for the year ended December 31, 2009, for the matters described in the following paragraphs.
 
Approval of the definitive merger agreement by the Corporation’s Board of Directors constituted a “change in control” as defined in certain agreements with employees. That “change in control” resulted in the following events, all of which were recognized in the Corporation’s financial statements for the year ended December 31, 2009:
 
 i. Under the terms of two restricted stock plans, all restrictions lapsed on outstanding, but non-vested, restricted stock and restricted stock units, except for those held by the Corporation’s Chairman, President, and Chief Executive Officer. As a result of that lapse, the Corporation recognized previously unrecognized compensation expense in the amount of approximately $33.0 million, restrictions lapsed on 479,034 restricted shares, and the Corporation issued 311,963 shares in satisfaction of the restricted units (those 311,963 shares were net of 166,037 shares withheld to satisfy employee tax withholding requirements). In addition, the Corporation repurchased 186,326 shares, representing shares with a fair value equal to amounts necessary to satisfy employee tax withholding requirements on the 479,034 restricted shares on which restrictions lapsed.
 
 ii.
Under the terms of severance agreements with 19 of its key employees, all unvested stock options held by those individuals, aggregating approximately 1.1 million options, immediately vested. As a result, the Corporation recognized previously unrecognized compensation expense associated with those options in the amount of approximately $9.3 million.
 
 iii.
Under the terms of The Black & Decker Supplemental Executive Retirement Plan, which covers six key employees, the participants became fully vested. As a result, the Corporation recognized additional pension expense of approximately $5.3 million.
 
The events described in paragraphs i. through iii. above were recognized in the Corporation’s financial statements for the year ended December 31, 2009, as the approval of the definitive merger agreement by the Corporation’s Board of Directors on November 2, 2009, constituted a “change in control” under certain agreements with employees and resulted in the occurrence—irrespective of whether or not the proposed merger is ultimately consummated—of those events. Additional payments upon a change in control—that are solely payable upon consummation of the proposed merger or termination of certain employees—will not be recognized in the Corporation’s financial statements until: (1) consummation of the proposed merger, which is subject to customary closing conditions, including obtaining certain regulatory approvals, as well as shareholder approval from the shareholders of both the Corporation and The Stanley Works, and therefore cannot be considered probable until such approvals are obtained; or (2) if prior to consummation of the proposed merger, the Corporation reaches a determination to terminate an affected employee, irrespective of whether the proposed merger is consummated.
 
On November 2, 2009, the Corporation’s Board of Directors amended the terms of The Black & Decker 2008 Executive Long-Term Incentive/Retention Plan to remove the provision whereby cash payouts under the plan are adjusted upward or downward proportionately to the extent that the Corporation’s common stock exceeds or is less than $67.78. As a result of this modification, the Corporation recognized additional compensation expense of $2.8 million in its financial statements for the year ended December 31, 2009.
 
 
 
 
11
 
 
 
The Corporation also expects that it will incur fees for various advisory, legal, and accounting services, as well as other expenses, associated with the proposed merger. The Corporation estimates that these outside service fees and other expenses, which will be expensed as incurred, will approximate $25 million, of which approximately $8.4 million of expenses were recognized in the year ended December 31, 2009. The anticipated $25 million of outside service fees includes approximately $10.5 million of fees that are only payable upon consummation of the proposed merger. The Corporation’s estimate of outside service fees is based upon current forecasts of expected service activity. There is no assurance that the amount of these fees could not increase significantly in the future if circumstances change.
 
NOTE 3: ACQUISITIONS
 
Effective September 9, 2008, the Corporation acquired Spiralock Corporation (Spiralock) for a cash purchase price of $24.1 million. During 2009, the Corporation received a $.2 million reduction to that purchase price based upon changes in the net assets of Spiralock as of the closing date. The addition of Spiralock to the Corporation’s Fastening and Assembly Systems segment allows the Corporation to offer customers a broader range of products.
 
The allocation of the purchase price resulted in the recognition of $13.6 million of goodwill primarily related to the anticipated future earnings and cash flows of Spiralock. The transaction also generated $10.2 million of finite-lived intangible assets that will be amortized over 15 years. These intangible assets are reflected in other assets in the Consolidated Balance Sheet. The Corporation does not believe that the goodwill and intangible assets recognized will be deductible for income tax purposes.
 
The Corporation also acquired another business during 2008, included in the Corporation’s Power Tools and Accessories segment, for a purchase price of $3.8 million. Of that purchase price, $1.6 million was paid in 2008, $1.6 million was paid in 2009 and the remainder will be paid in 2010.
 
The financial position and results of operations associated with these acquisitions have been included in the Corporation’s Consolidated Balance Sheet and Statement of Earnings since the date of acquisition.
 
NOTE 4: INVENTORIES
 
The classification of inventories at the end of each year, in millions of dollars, was as follows:
 
 
2009
 
2008
 
FIFO cost
           
Raw materials and work-in-process
 
$
195.7
   
$
263.9
 
Finished products
   
593.3
     
783.8
 
     
789.0
     
1,047.7
 
Adjustment to arrive at LIFO inventory value
   
(11.9
)
   
(23.5
)
   
$
777.1
   
$
1,024.2
 
 
The cost of United States inventories stated under the LIFO method was approximately 44% of the value of total inventories at December 31, 2009 and 2008.
 
NOTE 5: PROPERTY, PLANT, AND EQUIPMENT
 
Property, plant, and equipment at the end of each year, in millions of dollars, consisted of the following:
 
 
2009
 
2008
 
Property, plant, and equipment at cost:
           
Land and improvements
 
$
40.9
   
$
41.3
 
Buildings
   
299.6
     
299.7
 
Machinery and equipment
   
1,252.2
     
1,288.9
 
     
1,592.7
     
1,629.9
 
Less accumulated depreciation
   
1,119.3
     
1,102.0
 
   
$
473.4
   
$
527.9
 
 
Depreciation expense was $116.3 million, $125.2 million, and $132.6 million for the years ended December 31, 2009, 2008, and 2007, respectively.
 
NOTE 6: GOODWILL AND OTHER IDENTIFIED INTANGIBLE ASSETS
 
The changes in the carrying amount of goodwill by reportable business segment, in millions of dollars, were as follows:
 
 
POWER
TOOLS &
ACCESSORIES
 
HARDWARE
& HOME
 IMPROVEMENT
 
FASTENING &
   ASSEMBLY
   SYSTEMS
 
TOTAL
 
Balance at January 1, 2008
 
$
436.4
   
$
464.4
   
$
312.1
   
$
1,212.9
 
Acquisition
   
—
     
—
     
13.9
     
13.9
 
Currency translation adjustment
   
(3.5
) 
   
(1.0
) 
   
.9
     
(3.6
) 
Balance at December 31, 2008
   
432.9
     
463.4
     
326.9
     
1,223.2
 
Activity associated with prior year acquisition
   
—
     
—
     
(.3
) 
   
(.3
)
Currency translation adjustment
   
3.2
     
.7
     
3.2
     
7.1
 
Balance at December 31, 2009
 
$
436.1
   
$
464.1
   
$
329.8
   
$
1,230.0
 
 
 
 
12
 
 
The carrying amount of acquired intangible assets included in other assets at the end of each year, in millions of dollars, was as follows:
 
 
2009
 
2008
 
Customer relationships
    (net of accumulated amortization
    of $21.4 in 2009 and $15.7 in 2008)
 
$
51.2
   
$
56.9
 
Technology and patents
    (net of accumulated amortization
    of $11.8 in 2009 and $9.5 in 2008)
   
11.9
     
14.2
 
Trademarks and trade names
    (net of accumulated amortization
    of $2.2 in 2009 and $5.6 in 2008)
   
197.9
     
206.5
 
Total intangibles, net
 
$
261.0
   
$
277.6
 

Trademarks and trade names include indefinite-lived assets of $193.9 million at December 31, 2009 and 2008, respectively.
 
Expense associated with the amortization of finite- lived intangible assets in 2009, 2008, and 2007 was $10.4 million, $9.8 million, and $9.1 million, respectively. At December 31, 2009, the weighted-average amortization periods were 13 years for customer relationships, 11 years for technology and patents, and 10 years for trademarks and trade names. The estimated future amortization expense for identifiable intangible assets during each of the next four years is approximately $9.0 million. For the year ended December 31, 2014, this expense is expected to be approximately $8.0 million.
 
NOTE 7: OTHER CURRENT LIABILITIES
 
Other current liabilities at the end of each year, in millions of dollars, included the following:
 
 
2009
 
2008
 
Trade discounts and allowances
 
$
153.9
   
$
202.8
 
Employee benefits
   
117.5
     
128.8
 
Salaries and wages
   
93.9
     
81.1
 
Advertising and promotion
   
38.8
     
37.8
 
Warranty
   
50.7
     
55.2
 
Income taxes, including deferred taxes
   
64.0
     
102.0
 
All other
   
273.9
     
339.7
 
   
$
792.7
   
$
947.4
 
 
All other at December 31, 2009 and 2008, consisted primarily of accruals for foreign currency derivatives, environmental exposures, interest, insurance, restructuring, and taxes other than income taxes.
 
The following provides information with respect to the Corporation’s warranty accrual, in millions of dollars:
 
 
2009
 
2008
 
Warranty reserve at January 1
 
$
55.2
   
$
60.5
 
Accruals for warranties issued during
    the period and changes in estimates
    related to pre-existing warranties
   
92.1
     
123.0
 
Settlements made
   
(98.1
)
   
(125.1
)
Currency translation adjustments
   
1.5
     
(3.2
)
Warranty reserve at December 31
 
$
50.7
   
$
55.2
 
 
NOTE 8: SHORT-TERM BORROWINGS
 
Short-term borrowings in the amounts of $83.3 million at December 31, 2008, consisted primarily of borrowings under the terms of the Corporation’s commercial paper program, uncommitted lines of credit, and other short-term borrowing arrangements. The weighted-average interest rate on short-term borrowings outstanding was 2.20% at December 31, 2008.
 
The Corporation maintains an agreement under which it may issue commercial paper at market rates with maturities of up to 365 days from the date of issue. The maximum amount authorized for issuance under its commercial paper program is $1.0 billion. The Corporation’s ability to borrow under this commercial paper agreement is generally dependent upon the Corporation maintaining a minimum short-term debt credit rating of A2 / P2. There was $65.0 million outstanding under this agreement at December 31, 2008.
 
In December 2007, the Corporation replaced a $1.0 billion unsecured revolving credit facility (the Former Credit Facility) with a $1.0 billion senior unsecured revolving credit agreement (the Credit Facility) that expires December 2012. The amount available for borrowings under the Credit Facility was approximately $1.0 billion and $935.0 million at December 31, 2009 and 2008, respectively.
 
Under the Credit Facility, the Corporation has the option of borrowings at London Interbank Offered Rate (LIBOR) plus an applicable margin or at other variable rates set forth therein. The Credit Facility provides that the interest rate margin over LIBOR, initially set at .30%, will increase (by a maximum amount of .30%) or decrease (by a maximum amount of .12%) based on changes in the ratings of the Corporation’s long-term senior unsecured debt.
 
In addition to interest payable on the principal amount of indebtedness outstanding from time to time under the Credit Facility, the Corporation is required to pay an annual facility fee, initially equal to .10% of the amount of the aggregate commitments under the Credit Facility, whether used or unused. The Corporation is also required to pay a utilization fee, initially equal to .05% per annum, applied to the outstanding balance when borrowings under the Credit Facility exceed 50% of the aggregate commitments. The Credit Facility provides that both the facility fee and the utilization fee will increase or decrease based on changes in the ratings of the Corporation’s long-term senior unsecured debt.
 
 
 
13
 
 
 
The Credit Facility includes usual and customary covenants for transactions of this type, including covenants limiting liens on assets of the Corporation, sale-leaseback transactions and certain asset sales, mergers or changes to the businesses engaged in by the Corporation. The Credit Facility requires that the Corporation maintain specific leverage and interest coverage ratios. As of December 31, 2009, the Corporation was in compliance with all terms and conditions of the Credit Facility.
 
Under the terms of uncommitted lines of credit at December 31, 2009, the Corporation may borrow up to approximately $250 million on such terms as may be mutually agreed. These arrangements do not have termination dates and are reviewed periodically. No material compensating balances are required or maintained.
 
The average borrowings outstanding under the Corporation’s commercial paper program, uncommitted lines of credit, and other short-term borrowing arrangements during 2009 and 2008 were $167.0 million and $651.7 million, respectively.
 
NOTE 9: LONG-TERM DEBT
 
The composition of long-term debt at the end of each year, in millions of dollars, was as follows:
 
 
2009
 
2008
 
7.125% notes due 2011 (including discount
    of $.4 in 2009 and $.7 in 2008)
 
$
399.6
   
$
399.3
 
4.75% notes due 2014 (including discount
    of $1.1 in 2009 and $1.3 in 2008)
   
298.9
     
298.7
 
8.95% notes due in 2014 (including discount
    of $3.6 in 2009)
   
346.4 
     
 —
 
5.75% notes due 2016 (including discount
    of $.8 in 2009 and $1.0 in 2008)
   
299.2
     
299.0
 
7.05% notes due 2028
   
150.0
     
150.0
 
Other loans due through 2012
   
175.0
     
225.0
 
Fair value hedging adjustment
   
45.9
     
72.8
 
    Less current maturities of long-term debt
   
—
     
(.1
)
   
$
1,715.0
   
$
1,444.7
 
 
During 2008, the Corporation entered into loan agreements in the aggregate amount of $225.0 million, with $125.0 million and $100.0 million maturing in April 2011 and December 2012, respectively. The terms of the loan agreements permit repayment prior to maturity. Borrowings under the loan agreements are at variable rates. The average borrowing rate under the loan agreements is LIBOR plus 1.14%. At December 31, 2009 and 2008, the weighted-average interest rate on these loans was 1.41% and 3.76%, respectively.
 
In June 2009, the Corporation amended the terms of a $50.0 million term loan agreement to provide for periodic repayments and borrowings up to the original loan amount through the maturity date of April 2011. The Corporation is required to pay a commitment fee on the unutilized portion of the facility. At December 31, 2009, no borrowings were outstanding under this agreement. In February 2010, the Corporation terminated this agreement.
 
As more fully described in Note 1, at December 31, 2009 and 2008, the carrying amount of long-term debt and current maturities thereof includes $45.9 million and $72.8 million, respectively, relating to outstanding or terminated fixed-to-variable rate interest rate swap agreements. Deferred gains on the early termination of interest rate swaps were $21.8 million and $29.0 million at December 31, 2009 and 2008, respectively.
 
Indebtedness of subsidiaries in the aggregate principal amounts of $150.0 million and $152.8 million were included in the Consolidated Balance Sheet at December 31, 2009 and 2008, respectively, in short-term borrowings, current maturities of long-term debt, and long-term debt.
 
Principal payments on long-term debt obligations due over the next five years are as follows: $— million in 2010, $475.0 million in 2011, $100.0 million in 2012, $— million in 2013, and $650.0 million in 2014. Interest payments on all indebtedness were $97.9 million in 2009, $101.1 million in 2008, and $104.3 million in 2007.
 
NOTE 10: DERIVATIVE FINANCIAL INSTRUMENTS
 
As more fully described in Note 1, the Corporation is exposed to market risks arising from changes in foreign currency exchange rates, commodity prices, and interest rates. The Corporation manages these risks by entering into derivative financial instruments. The Corporation also manages these risks using methods other than derivative financial instruments. The fair value of all financial instruments is summarized in Note 11.
 
Foreign Currency Derivatives:   As more fully described in Note 1, the Corporation enters into various foreign currency contracts in managing its foreign currency exchange risk. Generally, the foreign currency contracts have maturity dates of less than twenty-four months. The contractual amounts of foreign currency derivatives, principally forward exchange contracts, generally are exchanged by the counterparties.
 
Hedge ineffectiveness and the portion of derivative gains and losses excluded from the assessment of hedge effectiveness related to the Corporation’s cash flow hedges that were recorded to earnings during 2009, 2008, and 2007 were not significant.
 
Amounts deferred in accumulated other comprehensive income (loss) at December 31, 2009, that are expected to be reclassified into earnings during 2010 represent an after-tax loss of $1.0 million. The amounts expected to be reclassified into earnings during 2010 include unrealized gains and losses related to open foreign currency contracts. Accordingly, the amounts that are ultimately reclassified into earnings may differ materially.
 
Interest Rate Derivatives: The Corporation’s portfolio of interest rate swap instruments at December 31, 2009 and 2008, consisted of $325.0 million notional amounts of fixed-to-variable rate swaps with a weighted-average fixed rate receipt of 4.81%, respectively. The basis of the variable rate paid is LIBOR.
 
The amounts exchanged by the counterparties to interest rate swap agreements normally are based upon the notional amounts and other terms, generally related to interest rates, of the derivatives. While notional amounts of interest rate swaps form part of the basis for the amounts exchanged by the counterparties, the notional amounts are not themselves exchanged and, therefore, do not represent a measure of the Corporation’s exposure as an end user of derivative financial instruments.
 
 
 
14
 
 
 
Commodity Derivatives:   As more fully described in Note 1, the Corporation enters into various commodity contracts in managing price risk related to metal purchases used in the manufacturing process. Generally, the commodity contracts have maturity dates of less than twenty-four months. The amounts exchanged by the counterparties to the commodity contracts normally are based upon the notional amounts and other terms, generally related to commodity prices. While the notional amounts of the commodity contracts form part of the basis for the amounts exchanged by the counterparties, the notional amounts are not themselves exchanged, and, therefore, do not represent a measure of the Corporation’s exposure as an end user of derivative financial instruments.
 
Hedge ineffectiveness and the portion of derivative gains and losses excluded from the assessment of hedge effectiveness related to the Corporation’s cash flow hedges for commodity trades recorded to earnings during 2009, 2008, and 2007 were not significant.
 
Amounts deferred in accumulated other comprehensive income (loss) at December 31, 2009, that are expected to be reclassified into earnings during 2010 represent an after-tax gain of $3.0 million. The amount expected to be reclassified into earnings during 2010 includes unrealized gains and losses related to open commodity contracts. Accordingly, the amounts that are ultimately reclassified into earnings may differ materially.
 
Credit Exposure:   The Corporation’s credit exposure on foreign currency, interest rate, and commodity derivatives as of December 31, 2009 and 2008 were $27.9 million and $183.4 million, respectively. That credit exposure reflects the effects of legally enforceable master netting arrangements.
 
Fair Value of Derivative Financial Instruments:   The following table details the fair value of derivative financial instruments included in the Consolidated Balance Sheet as of December 31, 2009 (in millions of dollars):
 
 
ASSET DERIVATIVES
 
LIABILITY DERIVATIVES
 
 
BALANCE SHEET LOCATION
FAIR
 VALUE
 
BALANCE SHEET LOCATION
FAIR
 VALUE
 
Derivatives Designated as Hedging Instruments
             
         Interest rate contracts
Other current assets
 
$
2.4
 
Other current liabilities
 
$
—
 
 
Other assets
   
24.2
 
Other long-term liabilities
   
—
 
         Foreign exchange contracts
Other current assets
   
48.5
 
Other current liabilities
   
50.1
 
 
Other assets
   
.9
 
Other long-term liabilities
   
.3
 
         Net investment contracts
Other current assets
   
2.9
 
Other current liabilities
   
15.2
 
         Commodity contracts
Other current assets
   
6.0
 
Other current liabilities
   
—
 
Total Derivatives Designated as Hedging Instruments
 
$
84.9
     
$
65.6
 

Derivatives Not Designated as Hedging Instruments
             
         Foreign exchange contracts
Other current assets
 
$
17.9
 
Other current liabilities
 
$
17.0
 
    Total Derivatives
   
$
102.8
     
$
82.6
 
 
The fair value of derivative financial instruments in the preceding table is presented prior to the netting of derivative receivables and derivative payables as disclosed previously.
 
The following table details the impact of derivative financial instruments in the Consolidated Statement of Earnings for the year ended December 31, 2009 (in millions of dollars):
 
Derivatives in Cash Flow
Hedging Relationships
 AMOUNT OF
GAIN (LOSS)
 RECOGNIZED
 IN OCI (a)
[EFFECTIVE PORTION]
 
LOCATION OF
GAIN (LOSS)
 RECLASSIFIED FROM
 OCI INTO INCOME
 [EFFECTIVE PORTION]
 
AMOUNT OF
GAIN (LOSS)
RECLASSIFIED FROM
OCI INTO INCOME [INEFFECTIVE PORTION]
 
LOCATION OF
 GAIN (LOSS)
 RECOGNIZED
IN INCOME
 [INEFFECTIVE PORTION]
 
AMOUNT OF
GAIN (LOSS)
 RECOGNIZED
IN INCOME
 [INEFFECTIVE PORTION]
 
Foreign exchange contracts
 
$
46.9
 
Cost of goods sold
   
$
42.4
 
Cost of goods sold
   
$
—
 
         
Interest expense, net
     
2.3
 
Interest expense, net
     
—
 
         
Other expense
 (income)
     
78.8
 
Other expense
 (income)
     
.1
 
Commodity contracts
   
9.6
 
Cost of goods sold
     
(6.5
)
Cost of goods sold
     
—
 
Total
 
$
56.5
       
$
117.0
       
$
.1
 
 
 
 
 
15
 
 
 
    Derivatives in Fair Value Hedging Relationships
LOCATION OF GAIN (LOSS)
 RECOGNIZED IN INCOME
AMOUNT OF GAIN (LOSS)
 RECOGNIZED IN INCOME
 
Interest rate contracts
Interest expense, net
 
$
(8.6
)
 
 
Derivatives in Net Investment Hedging Relationships
 AMOUNT OF GAIN (LOSS)
 RECOGNIZED IN OCI
 [EFFECTIVE PORTION]
 
LOCATION OF GAIN (LOSS)
 RECOGNIZED IN INCOME
 [INEFFECTIVE PORTION]
AMOUNT OF GAIN (LOSS)
 RECOGNIZED IN INCOME 
 [INEFFECTIVE PORTION]
 
Foreign exchange contracts
 
$
(66.1
)
Other expense
 (income)
 
$
—
 
 
 
Derivatives Not Designated as Hedging Instruments
LOCATION OF GAIN (LOSS)
 RECOGNIZED IN INCOME
AMOUNT OF GAIN (LOSS)
 RECOGNIZED IN INCOME
 
Foreign exchange contracts
Cost of goods sold
 
$
(.1
)
 
Other expense (income)
   
1.6
 
Total
   
$
1.5
 

(a)  
OCI is defined as Accumulated Other Comprehensive income (loss), a component of stockholders’ equity.
 
NOTE 11: FAIR VALUE OF FINANCIAL INSTRUMENTS
 
The following table presents the fair value of the Corporation’s financial instruments as of December 31, 2009 and 2008, in millions of dollars. Significant differences can arise between the fair value and carrying amount of financial instruments that are recognized at historical cost amounts.

 
QUOTED PRICES
  IN ACTIVE
   MARKETS FOR
 IDENTICAL
   ASSETS
   (LEVEL 1)
 
SIGNIFICANT
  OTHER
  OBSERVABLE
  INPUTS
   (LEVEL 2)
 
   NETTING
(a) 
DECEMBER 31,
  2009
 
Assets:
                       
Investments
 
$
34.3
   
$
25.2
   
$
—
   
$
59.5
 
Derivatives
   
6.0
     
96.8
     
(65.7
)
   
37.1
 
Liabilities:
                               
Derivatives
   
—
     
(82.6
)
   
65.7
     
(16.9
) 
Debt
   
—
     
(1,786.7
) 
   
—
     
(1,786.7
) 

 
 
QUOTED PRICES
  IN ACTIVE
   MARKETS FOR
 IDENTICAL
   ASSETS
   (LEVEL 1)
 
SIGNIFICANT
  OTHER
  OBSERVABLE
  INPUTS
   (LEVEL 2)
 
   NETTING
(a) 
DECEMBER 31,
  2008
 
Assets:
                       
Investments
 
$
45.8
   
$
21.7
   
$
—
   
$
67.5
 
Derivatives
   
—
     
402.7
     
(219.3
)
   
183.4
 
Liabilities:
                               
Derivatives
   
(7.7
)
   
(261.6
)
   
219.3
     
(50.0
) 
Debt
   
—
     
(1,370.8
) 
   
—
     
(1,370.8
) 

(a) 
Accounting principles generally accepted in the Unites States permit the netting of derivative receivables and derivative payables when a legally enforceable master netting arrangement exists.
 
The carrying amounts of investments and derivatives are equal to their fair value. The carrying amount of debt at December 31, 2009 and 2008, is $1,715.0 million and $1,528.1 million, respectively.
 
Investments, derivative contracts and debt are valued at December 31, 2009 and 2008, using quoted market prices for identical or similar assets and liabilities. Investments classified as Level 1 include those whose fair value is based on identical assets in an active market. Investments classified as Level 2 include those whose fair value is based upon identical assets in  markets that are less active. The fair value for derivative contracts are based upon current quoted market prices and are classified as Level 1 or Level 2 based on the nature of the underlying markets in which these derivatives are traded. The fair value of debt is based upon current quoted market prices in markets that are less active.
 
 
16
 
 
 
NOTE 12: INCOME TAXES
 
Earnings (loss) before income taxes for each year, in millions of dollars, were as follows:
 
 
2009
 
2008
 
2007
 
United States
 
$
(121.2
) 
 
$
.4
   
$
97.2
 
Other countries
   
291.6
     
364.3
     
400.4
 
   
$
170.4
   
$
364.7
   
$
497.6
 

Significant components of income taxes (benefit) for each year, in millions of dollars, were as follows:
 
 
2009
 
2008
 
2007
 
Current:
                 
United States
 
$
(28.7
)
 
$
(6.1
)
 
$
(65.5
) 
Other countries
   
50.5
     
69.8
     
68.6
 
     
21.8
     
63.7
     
3.1
 
Deferred:
                       
United States
   
15.5
     
3.2
     
(16.3
)
Other countries
   
.6
     
4.2
     
(7.3
)
     
16.1
     
7.4
     
(23.6
)
   
$
37.9
   
$
71.1
   
$
(20.5
)
 
Income tax expense (benefits) recorded directly as an adjustment to equity as a result of the exercise of employee stock options and the vesting of other stock-based compensation arrangements were $.9 million, $(.1) million, and $(13.3) million in 2009, 2008, and 2007, respectively. Income tax expense (benefits) recorded directly as an adjustment to equity as a result of hedging activities were $(23.1) million, $89.4 million, and $(13.8) million in 2009, 2008, and 2007, respectively.
 
 
 
 
 
17
 
 
 
Income tax payments were $85.9 million in 2009, $168.1 million in 2008, and $139.5 million in 2007.
 
Deferred tax (liabilities) assets at the end of each year, in millions of dollars, were composed of the following:
 
 
2009
 
2008
 
Deferred tax liabilities:
           
Other
 
 $
(84.1
)
 
 $
(80.4
)
Gross deferred tax liabilities
   
(84.1
)
   
(80.4
)
Deferred tax assets:
               
    Tax loss carryforwards
   
49.9
     
36.2
 
    Postretirement benefits
   
244.0
     
209.1
 
    Environmental remediation matters
   
34.3
     
34.7
 
    Stock-based compensation
   
29.8
     
40.7
 
    Other
   
161.6
     
163.9
 
Gross deferred tax assets
   
519.6
     
484.6
 
Deferred tax asset valuation allowance
   
(37.8
)
   
(27.6
)
Net deferred tax assets
 
$
397.7
   
 $
376.6
 
 
Deferred income taxes are included in the Consolidated Balance Sheet in other current assets, other assets, other current liabilities, and other long-term liabilities. Other deferred tax assets principally relate to accrued liabilities that are not currently deductible and items relating to uncertain tax benefits which would not affect the annual effective tax rate.
 
Tax loss carryforwards at December 31, 2009, consisted of net operating losses expiring from 2010 to 2026.
 
A reconciliation of income taxes (benefit) at the federal statutory rate to the Corporation’s income taxes for each year, in millions of dollars, is as follows:
 
 
2009
 
2008
 
2007
 
Income taxes at federal
    statutory rate
 
$
59.7
   
$
127.6
   
$
174.2
 
    Settlement of tax litigation
   
—
     
—
     
(153.4
)
Lower effective taxes on
    earnings in other countries
   
(37.9
) 
   
(59.5
)
   
(53.6
)
Other – net
   
16.1
     
3.0
     
12.3
 
    Income taxes (benefit)
 
$
37.9
   
 $
71.1
   
 $
(20.5
)
 
At December 31, 2009, unremitted earnings of subsidiaries outside of the United States were approximately $2.1 billion, on which no United States taxes had been provided. The Corporation’s intention is to reinvest these earnings permanently or to repatriate the earnings only when possible to do so at minimal additional tax cost. It is not practicable to estimate the amount of additional taxes that might be payable upon repatriation of foreign earnings.
 
Uncertain Tax Positions: As disclosed in Note 1 of Notes to Consolidated Financial Statements the Corporation adopted a new accounting standard for uncertain tax positions effective January 1, 2007. Upon adoption, the Corporation recorded the cumulative effect of the change in accounting principle of $7.3 million as a reduction to retained earnings.
 
As of December 31, 2009 and 2008, the Corporation has recognized $291.8 million and $255.8 million, respectively, of liabilities for unrecognized tax benefits of which $31.5 million and $24.3 million, respectively, related to interest. As of December 31, 2009 and 2008, the Corporation classified $48.0 million and $47.5 million, respectively, of its liabilities for unrecognized tax benefits within other current liabilities. Non-current tax reserves are recorded in other long-term liabilities in the Consolidated Balance Sheet.
 
A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest, for each year, in million of dollars, is set forth below:
 
 
2009
 
2008
 
2007
 
Balance at January 1
 
$
231.5
   
$
317.4
   
$ 
359.5
 
Additions based on tax positions
    related to current year
   
23.9
     
33.9
     
 35.2
 
Additions for tax positions 
    related to prior years
   
18.9
     
65.5
     
 63.0
 
Reductions for tax positions 
    related to prior years
   
(9.2
)
   
(40.3
)
   
 (115.0
) 
Settlements (payments)
   
(4.8
)
   
(57.0
)
   
 (26.2
) 
Expiration of the statute of limitations
   
(3.4
)
   
(75.1
)
   
 (13.5
)
Foreign currency translation adjustment
   
3.4
     
(12.9
)
   
 14.4
 
Balance at December 31
 
$
260.3
   
$
231.5
   
$ 
 317.4
 
 
The liabilities for unrecognized tax benefits at December 31, 2009 and 2008, include $39.1 million and $38.0 million, respectively, for which the disallowance of such items would not affect the annual effective tax rate. However, the timing of the realization of the tax benefits is uncertain. Such uncertainty would not impact tax expense but could affect the timing of tax payments to taxing authorities.
 
The Corporation recognizes interest and penalties relating to its liabilities for unrecognized tax benefits as an element of tax expense. During the years ended December 31, 2009, 2008 and 2007, the Corporation recognized $7.3 million, $13.4 million and $20.7 million, respectively, in interest as a component of tax expense. Penalties were not significant.
 
 
 
18
 
 
 
The Corporation conducts business globally and, as a result, the Corporation and/or one or more of its subsidiaries file income tax returns in the federal and various state jurisdictions in the U.S. as well as in various jurisdictions outside of the U.S. In certain jurisdictions, the Corporation is either currently in the process of a tax examination or the statute of limitations has not yet expired. The Corporation generally remains subject to examination of its U.S. federal income tax returns for 2006 and later years, except as disclosed below. In the U.S., the Corporation generally remains subject to examination of its various state income tax returns for a period of four to five years from the date the return was filed. The state impact of any federal changes remains subject to examination by various states for a period up to one year after formal notification of the states. The Corporation generally remains subject to examination of its various income tax returns in its significant jurisdictions outside the U.S. for periods ranging from three to five years after the date the return was filed. However, in Canada and Germany, the Corporation remains subject to examination of its tax returns for 2001 and later years, and 1999 and later years, respectively.
 
During 2003, the Corporation received notices of proposed adjustments from the U.S. Internal Revenue Service (IRS) in connection with audits of the tax years 1998 through 2000. The principal adjustment proposed by the IRS, and disputed by the Corporation, consisted of the disallowance of a capital loss deduction taken in the Corporation’s tax returns and interest on the deficiency. This matter was the subject of litigation between the Corporation and the U.S. government. If the U.S. government were to have prevailed in its disallowance of the capital loss deduction and imposition of related interest, it would have resulted in a cash outflow by the Corporation of approximately $180 million. If the Corporation were to have prevailed, it would have resulted in the Corporation receiving a refund of taxes previously paid of approximately $50 million, plus interest. In December 2007, the Corporation and the U.S. government reached a settlement agreement with respect to the previously described litigation. That settlement agreement resolved the litigation relating to the audits of the tax years 1998 through 2000 and also resolved the treatment of this tax position in subsequent years. As a result of the settlement agreement, the Corporation recognized a $153.4 million reduction to tax expense in 2007, representing a reduction of the previously unrecognized tax benefit associated with the IRS’s disallowance of the capital loss, the imposition of related interest, and the effects of certain related tax positions taken in subsequent years. The effect of tax positions taken in subsequent years included the recognition of $31.4 million of previously unrecognized net operating loss carryforwards of a subsidiary. The IRS closing agreements were finalized in 2008. The Corporation made cash payments of approximately $50 million during 2008 relating to this settlement.
 
Judgment is required in assessing the future tax consequences of events that have been recognized in the Corporation’s financial statements or income tax returns. Additionally, the Corporation is subject to periodic examinations by taxing authorities in many countries. The Corporation is currently undergoing periodic examinations of its tax returns in the United States (both federal and state), Canada, Germany, and the United Kingdom. The IRS completed its examination of the Corporation’s U.S. federal income tax returns for 2004 and 2005 in 2008. At that time, the Corporation received notices of proposed adjustments from the IRS in conjunction with those audits. The Corporation vigorously disputed the position taken by the IRS on these matters and initiated an appeals process with the IRS. During 2009, the Corporation reached a tentative settlement agreement with IRS appeals for those years. If that settlement – currently pending approval by the Joint Committee on Taxation of the U.S. Congress – is finalized, the Corporation will release tax reserves. The IRS is currently examining the Corporation’s U.S. federal income tax returns for 2006 and 2007. To date, no proposed adjustments have been issued; however, the Corporation expects that the IRS will complete that examination in 2010. The Corporation is also subject to legal proceedings regarding certain of its tax positions in a number of countries, including Italy. The final outcome of the future tax consequences of these examinations and legal proceedings as well as the outcome of competent authority proceedings, changes in regulatory tax laws, or interpretation of those tax laws, changes in income tax rates, or expiration of statutes of limitation could impact the Corporation’s financial statements. The Corporation is subject to the effects of these matters occurring in various jurisdictions. Accordingly, the Corporation has tax reserves recorded for which it is reasonably possible that the amount of the unrecognized tax benefit will increase or decrease within the next twelve months. Any such increase or decrease could have a material affect on the financial results for any particular fiscal quarter or year. However, based on the uncertainties associated with litigation and the status of examinations, including the protocols of finalizing audits by the relevant tax authorities, which could include formal legal proceedings, it is not possible to estimate the impact of any such change.
 
 
 
 
 
19
 
 
 
NOTE 13: POSTRETIREMENT BENEFITS
 
The following tables set forth the funded status of the defined benefit pension and postretirement plans, and amounts recognized in the Consolidated Balance Sheet at the end of each year, in millions of dollars.
 
   
2009
   
2008
 
 
PENSION
 BENEFITS
 PLANS
   IN THE
 UNITED STATES
 
PENSION
 BENEFITS
 PLANS
 OUTSIDE
 OF THE
 UNITED STATES
 
OTHER
 POST-
  RETIREMENT
 BENEFITS
 ALL PLANS
 
PENSION
 BENEFITS
 PLANS
   IN THE
 UNITED STATES
 
PENSION
 BENEFITS
 PLANS
 OUTSIDE
 OF THE
 UNITED STATES
 
OTHER
 POST-
 RETIREMENT
 BENEFITS
 ALL PLANS
 
CHANGE IN BENEFIT OBLIGATION
                               
Benefit obligation at beginning of year
 
$
1,012.3
   
$
531.4
   
$
81.4
   
$
1,013.2
   
$
793.1
   
$
86.9
 
Service cost
   
18.2
     
7.7
     
.7
     
26.1
     
14.7
     
.8
 
Interest cost
   
65.9
     
33.5
     
4.8
     
78.1
     
49.1
     
4.9
 
Curtailment gain
   
—
     
—
     
—
     
(1.1
)
   
(1.5
)
   
—
 
Plan participants’ contributions
   
—
     
1.1
     
1.4
     
—
     
1.6
     
3.3
 
Actuarial (gains) losses
   
107.3
     
72.5
     
9.6
     
(21.9
)
   
(96.7
)
   
3.4
 
Foreign currency exchange rate changes
   
—
     
50.3
     
1.5
     
—
     
(182.3
) 
   
(1.9
)
Benefits paid
   
(67.8
)
   
(36.9
)
   
(12.9
)
   
(82.1
)
   
(46.6
)
   
(15.6
)
Plan amendments
   
2.5
     
—
     
—
     
—
     
—
     
(.4
)
Benefit obligation at end of year
   
1,138.4
     
659.6
     
86.5
     
1,012.3
     
531.4
     
81.4
 
CHANGE IN PLAN ASSETS
                                               
Fair value of plan assets at beginning of year
 
606.4
     
343.6
     
—
     
987.8
     
643.6
     
—
 
Actual return/(loss) on plan assets
   
140.4
     
62.6
     
—
     
(297.1
)
   
(119.6
)
   
—
 
Expenses
   
(6.6
)
   
(1.4
)
   
—
     
(9.2
)
   
(2.1
)
   
—
 
Benefits paid
   
(67.8
)
   
(35.5
)
   
(12.9
)
   
(82.1
)
   
(44.5
)
   
(15.6
)
Employer contributions
   
6.8
     
13.1
     
11.5
     
7.0
     
21.4
     
12.3
 
Contributions by plan participants
   
—
     
1.1
     
1.4
     
—
     
1.6
     
3.3
 
Foreign currency exchange rate changes
   
—
     
39.2
     
—
     
—
     
(156.8
)
   
—
 
Fair value of plan assets at end of year
   
679.2
     
422.7
     
—
     
606.4
     
343.6
     
—
 
Funded status
   
(459.2
)
   
(236.9
)
   
(86.5
)
   
(405.9
)
   
(187.8
)
   
(81.4
)
Contributions subsequent to measurement date
 
—
     
—
     
—
     
—
     
—
     
—
 
Accrued benefit cost at December 31
 
$
(459.2
)
 
$
(236.9
)
 
$
(86.5
)
 
$
(405.9
)
 
$
(187.8
)
 
$
(81.4
)
AMOUNTS RECOGNIZED IN THE
    CONSOLIDATED BALANCE SHEET
                                             
Noncurrent assets
 
$
—
   
$
—
   
$
—
   
$
17.5
   
$
—
   
$
—
 
Current liabilities
   
(7.0
)
   
(5.9
)
   
(9.3
)
   
(8.6
)
   
(5.3
)
   
(9.3
)
Postretirement benefits
   
(452.2
)
   
(231.0
)
   
(77.2
)
   
(414.8
)
   
(182.5
)
   
(72.1
)
Net amount recognized at December 31
 
$
(459.2
)
 
$
(236.9
)
 
$
(86.5
)
 
$
(405.9
)
 
$
(187.8
)
 
$
(81.4
)
WEIGHTED-AVERAGE ASSUMPTIONS
    USED TO DETERMINE BENEFIT
    OBLIGATIONS AS OF MEASUREMENT DATE
                                         
Discount rate
   
5.75
%
   
5.56
%
   
5.25
%
   
6.75
%
   
6.16
%
   
6.25
%
Rate of compensation increase
   
3.95
%
   
3.61
%
   
—
     
3.95
%
   
3.60
%
   
—
 
 
The amounts recognized in accumulated other comprehensive income (loss) as of December 31, 2009 and 2008, are as follows, in millions of dollars:   
 
DECEMBER 31, 2009
PENSION BENEFITS
 PLANS IN THE
 UNITED STATES
 
PENSION  BENEFITS
 PLANS OUTSIDE OF THE  UNITED STATES
 
OTHER
 POSTRETIREMENT
 BENEFITS
 ALL PLANS
 
TOTAL
 
Prior service (cost) credit
 
$
(5.7
) 
 
$
(5.0
) 
 
$
19.7
   
$
9.0
 
Net loss
   
(579.9
) 
   
(174.0
) 
   
(23.9
) 
   
(777.8
) 
Total
 
$
(585.6
) 
 
$
(179.0
) 
 
$
(4.2
) 
 
$
(768.8
) 
                                 
DECEMBER 31, 2008
                               
Prior service (cost) credit
 
$
(9.9
) 
 
$
(5.4
) 
 
$
23.1
   
$
7.8
 
Net loss
   
(556.3
) 
   
(117.8
) 
   
(15.1
) 
   
(689.2
) 
Total
 
$
(566.2
) 
 
$
(123.2
) 
 
$
8.0
   
$
(681.4
) 
 
 
 
 
20
 
 
 
 
The amounts in accumulated other comprehensive income (loss) as of December 31, 2009, that are expected to be recognized as components of net periodic benefit cost (credit) during 2010 are as follows, in millions of dollars:
 
 
PENSION BENEFITS
PLANS IN THE
 UNITED STATES
 
PENSION BENEFITS
   PLANS OUTSIDE OF THE UNITED STATES
 
OTHER
 POSTRETIREMENT
 BENEFITS
 ALL PLANS
 
TOTAL
 
Prior service cost (credit)
 
$
.8
   
$
1.0
   
$
(3.4
)
 
$
(1.6
)
Net loss
   
38.6
     
5.9
     
1.5
     
46.0
 
Total
 
$
39.4
   
$
6.9
   
$
(1.9
)
 
$
44.4
 
 
The Corporation’s overall investment strategy is to achieve an asset allocation of approximately 65% equity securities, 30% fixed income securities, and 5% alternative investments. The Corporation’s overall investment strategy provides that, to the extent the actual allocation of plan assets differs from the targeted asset allocation by more than 5% for any category, plan assets are rebalanced.  The Corporation further allocates assets within the equity securities and fixed income securities between investments that attempt to approximate the return achieved by broadly established investment indexes as well as investments that are actively managed and attempt to exceed the returns achieved by these broadly established investment indexes. Equity securities include investments in individual stocks and collective investment funds (referred to as mutual funds), including an allocation of those investments to U.S. equity securities, including large-cap, mid-cap and small-cap companies, and non-U.S. equity securities. Fixed income securities include U.S. Treasury securities, corporate bonds of companies from diversified industries, mortgaged-backed securities, and mutual funds. The Corporation does not believe there is a significant concentration risk within the plan assets given the diversification of asset types, fund strategies, and fund managers.
 
The three levels of input used to measure fair value are more fully described in Note 1 of Notes to the Consolidated Financial Statements. The fair values, by asset category, of assets of defined benefit pension plans in the United States at December 31, 2009, were as follows, in millions of dollars:
 
ASSET CATEGORY 
QUOTED PRICES
 IN ACTIVE
 MARKETS FOR
 IDENTICAL
 ASSETS
 (LEVEL 1)
 
SIGNIFICANT
OTHER
OBSERVABLE
INPUTS
(LEVEL 2)
 
SIGNIFICANT
 UNOBSERVABLE
 INPUTS
 (LEVEL 3)
 
DECEMBER 31, 2009
 TOTAL
 
Cash and cash equivalents
 
$
.3
   
$
4.9
   
$
—
   
$
5.2
 
Equity securities:
                               
U.S. companies
   
107.0
     
—
     
—
     
107.0
 
Mutual funds
   
163.1
     
193.6
     
—
     
356.7
 
Fixed income:
                               
U.S. treasury securities
   
—
     
43.4
     
—
     
43.4
 
Corporate bonds
   
—
     
43.2
     
—
     
43.2
 
Mortgage-backed securities
   
—
     
8.1
     
—
     
8.1
 
Mutual funds
   
—
     
93.8
     
8.0
     
101.8
 
Other fixed income
   
—
     
1.5
     
—
     
1.5
 
Alternative investments
   
—
     
—
     
23.1
     
23.1
 
Other
   
(10.8
)
   
—
     
—
     
(10.8
)
Total
 
$
259.6
   
$
388.5
   
$
31.1
   
$
679.2
 
 
 
 
 
21
 
 
 
The fair values, by asset category, of assets of defined benefit pension plans outside of the United States at December 31, 2009, were as follows, in millions of dollars:

ASSET CATEGORY 
QUOTED PRICES
 IN ACTIVE
 MARKETS FOR
 IDENTICAL
 ASSETS
 (LEVEL 1)
 
SIGNIFICANT
OTHER
OBSERVABLE
INPUTS
(LEVEL 2)
 
SIGNIFICANT UNOBSERVABLE
 INPUTS
 (LEVEL 3)
 
DECEMBER 31, 2009
 TOTAL
 
Cash and cash equivalents
 
$
4.6
   
$
—
   
$
—
   
$
4.6
 
Equity securities:
                               
International companies
   
61.0
     
6.9
     
—
     
67.9
 
Mutual funds
   
218.3
     
—
     
—
     
218.3
 
Fixed income:
                               
Corporate bonds
   
—
     
69.7
     
—
     
69.7
 
Government issues
   
—
     
50.3
     
—
     
50.3
 
Other fixed income
   
—
     
4.7
     
—
     
4.7
 
Alternative investments
   
.3
     
—
     
6.7
     
7.0
 
Other
   
.2
     
—
     
—
     
.2
 
Total
 
$
284.4
   
$
131.6
   
$
6.7
   
$
422.7
 

The equity securities – mutual funds held by the pension plans in the United States include approximately 70% that invest in large-cap and small-cap U.S. companies, and 30% that invest in international equity securities.  The equity securities – mutual funds held by the pension plans outside of the United States include approximately 50% that invest in U.K. equity securities and 50% that invest in other international equity securities.
 
The following table sets forth a summary of changes in the fair value of assets of the Corporation’s defined benefit pension plans, determined based upon significant unobservable inputs (Level 3), for the year ended December 31, 2009, in millions of dollars:

 
  PENSION BENEFITS
 PLANS IN THE
 UNITED STATES
 
PENSION BENEFITS
 PLANS OUTSIDE OF THE
 UNITED STATES
 
TOTAL
 
Balance, beginning of year
 
$
37.4
   
$
20.7
   
$
58.1
 
Sales (net of purchases)
   
(4.7
)
   
(11.5
) 
   
(16.2
) 
Transfers in (out)
   
—
     
(.2
)
   
(.2
)
Net realized and unrealized gain (loss)
   
(1.6
)
   
(3.9
)
   
(5.5
)
Foreign exchange
   
—
     
1.6
     
1.6
 
Balance, end of year
 
$
31.1
   
$
6.7
   
$
37.8
 
 
The Corporation establishes its estimated long-term return on plan assets considering various factors, which include the targeted asset allocation percentages, historical returns, and expected future returns. Specifically, the factors are considered in the fourth quarter of the year preceding the year for which those assumptions are applied. The Corporation’s weighted-average expected long-term return on plan assets assumption for defined benefit pension plans in the United States and outside of the United States will be 8.25% and 7.23%, respectively, in 2010.
 
The accumulated benefit obligation related to all defined benefit pension plans and information related to unfunded and underfunded defined benefit pension plans at the end of each year, in millions of dollars, follows:
 
 
PENSION BENEFITS
PLANS IN THE
  UNITED STATES
 
PENSION BENEFITS
  PLANS OUTSIDE OF THE
   UNITED STATES
 
 
2009
 
2008
 
2009
 
2008
 
All defined benefit plans:
                       
    Accumulated benefit obligation
 
$
1,079.3
   
$
958.4
   
$
632.9
   
$
504.4
 
Unfunded defined benefit plans:
                               
    Projected benefit obligation
   
108.8
     
95.3
     
125.5
     
119.4
 
    Accumulated benefit obligation
   
97.3
     
84.5
     
116.3
     
110.5
 
Defined benefit plans with an accumulated benefit
    obligation in excess of the fair value of plan assets:
                               
    Projected benefit obligation
   
1,138.4
     
1,006.1
     
659.6
     
522.3
 
    Accumulated benefit obligation
   
1,079.3
     
952.2
     
632.9
     
496.1
 
    Fair value of plan assets
   
679.2
     
582.7
     
422.7
     
334.6
 
 
 
 
 
 
22
 
 
 
The following table sets forth, in millions of dollars, benefit payments, which reflect expected future service, as appropriate, expected to be paid in the periods indicated:
 
 
PENSION BENEFITS
 PLANS IN THE
 UNITED STATES
 
PENSION BENEFITS
 PLANS OUTSIDE OF THE
 UNITED STATES
 
OTHER POST-
RETIREMENT
 BENEFITS ALL PLANS
 
2010
 
$
72.9
   
$
30.9
   
$
9.6
 
2011
   
72.9
     
32.0
     
9.2
 
2012
   
72.5
     
33.0
     
8.7
 
2013
   
94.7
     
34.3
     
8.3
 
2014
   
74.2
     
35.3
     
8.1
 
2015-2019
   
388.0
     
195.1
     
35.9
 
 
The net periodic cost (benefit) related to the defined benefit pension plans included the following components, in millions of dollars:
 
 
PENSION BENEFITS
 PLANS IN THE UNITED STATES
 
PENSION BENEFITS
PLANS OUTSIDE OF THE UNITED STATES
 
 
2009
 
2008
 
2007
 
2009
 
2008
 
2007
 
Service cost
 
$
19.3
   
$
22.6
   
$
26.0
   
$
7.7
   
$
12.3
   
$
14.7
 
Interest cost
   
65.9
     
63.7
     
62.5
     
33.5
     
40.9
     
39.6
 
Expected return on plan assets
   
(69.5
)
   
(77.9
)
   
(75.6
)
   
(32.4
)
   
(40.1
)
   
(39.3
)
Amortization of prior service cost
   
1.4
     
2.1
     
2.1
     
1.0
     
1.4
     
1.7
 
Amortization of net actuarial loss
   
18.4
     
15.9
     
26.3
     
—
     
4.7
     
12.9
 
Curtailment loss
   
5.3
     
—
     
—
     
—
     
1.1
     
—
 
Net periodic cost
 
$
40.8
   
$
26.4
   
$
41.3
   
$
9.8
   
$
20.3
   
$
29.6
 
WEIGHTED-AVERAGE ASSUMPTIONS
    USED IN DETERMINING NET
    PERIODIC COST FOR YEAR:
                                               
Discount rate
   
6.75
%
   
6.50
%
   
6.00
%
   
6.16
%
   
5.67
%
   
4.93
%
Expected return on plan assets
   
8.25
%
   
8.75
%
   
8.75
%
   
7.24
%
   
7.49
%
   
7.49
%
Rate of compensation increase
   
4.00
%
   
4.00
%
   
3.95
%
   
3.60
%
   
3.65
%
   
3.65
%
 
The net periodic cost related to the defined benefit postretirement plans included the following components, in millions of dollars:

   
2009
   
2008
   
2007
 
Service cost
 
$
.7
   
$
.8
   
$
.8
 
Interest cost
   
4.8
     
4.9
     
5.3
 
Amortization of prior service cost
   
(3.4
)
   
(3.6
)
   
(4.5
)
Amortization of net actuarial loss
   
.8
     
.4
     
.2
 
Net periodic cost
 
$
2.9
   
$
2.5
   
$
1.8
 
Weighted-average discount rate
    used in determining net  
    periodic cost for year
   
6.25
%
   
6.00
%
   
6.25
%
 
The health care cost trend rate used to determine the postretirement benefit obligation was 7.70% for participants under 65 and 7.00% for participants 65 and older in 2009. This rate decreases gradually to an ultimate rate of 4.50% in 2028, and remains at that level thereafter. The trend rate is a significant factor in determining the amounts reported. A one-percentage-point change in these assumed health care cost trend rates would have the following effects, in millions of dollars:
 
ONE-PERCENTAGE-POINT
  INCREASE
(DECREASE)
 
Effect on total of service and
    interest cost components
$
.2
 
$
(.2
)
    Effect on postretirement benefit obligation
 
3.9
   
(3.6
)
 
In 2010, the Corporation expects to make cash contributions of approximately $67.0 million to its defined benefit pension plans. The amounts principally represent contributions required by funding regulations or laws or those related to unfunded plans necessary to fund current benefits. In addition, the Corporation expects to continue to make contributions in 2010 sufficient to fund benefits paid under its other postretirement benefit plans during that year, net of contributions by plan participants. The Corporation expects that such contributions will be approximately $9.6 million in 2010.
 
Expense for defined contribution plans amounted to $6.2 million, $13.0 million, and $12.4 million in 2009, 2008, and 2007, respectively.
 
NOTE 14: STOCKHOLDERS’ EQUITY
 
The Corporation repurchased 247,198, 3,136,644 and 5,477,243 shares of its common stock during 2009, 2008 and 2007 at an aggregate cost of $13.4 million, $202.3 million and $461.4 million, respectively.
 
To reflect the repurchases in its Consolidated Balance Sheet, the Corporation: (i) first, reduced its common stock by $.1 million in 2009, $1.6 million in 2008, and $2.7 million in 2007, representing the aggregate par value of the shares repurchased; (ii) next, reduced capital in excess of par value by $13.3 million in 2009, $52.3 million in 2008, and $82.0 million in 2007 – amounts which brought capital in excess of par value to zero during the quarters in 2008 and 2007 in which the repurchases occurred; and (iii) last, charged the residual of $— million in 2009, $148.4 million in 2008, and $376.7 million in 2007, to retained earnings.
 
 
 
23
 
 
 
Accumulated other comprehensive income (loss) at the end of each year, in millions of dollars, included the following components:
 
 
2009
 
2008
 
Foreign currency translation adjustment
 
$
32.1
   
$
(65.4
)
Net gain (loss) on derivative instruments,
    net of tax
   
2.6
     
55.9
 
Minimum pension liability adjustment,
    net of tax
   
(507.5
)
   
(446.8
)
   
$
(472.8
)
 
$
(456.3
)
 
Foreign currency translation adjustments are not generally adjusted for income taxes as they relate to indefinite investments in foreign subsidiaries. The Corporation has designated certain intercompany loans and foreign currency derivative contracts as long-term investments in certain foreign subsidiaries. Net translation gains (losses) associated with these designated intercompany loans and foreign currency derivative contracts in the amounts of $32.6 million and $(151.6) million were recorded in the foreign currency translation adjustment in 2009 and 2008, respectively.
 
The minimum pension liability adjustments as of December 31, 2009 and 2008, are net of taxes of $261.3  million and $234.6 million, respectively.
 
NOTE 15: EARNINGS PER SHARE
 
The computations of basic and diluted earnings per share for each year were as follows:
 
(AMOUNTS IN MILLIONS
EXCEPT PER SHARE DATA)
2009
 
2008
 
2007
 
Numerator:
                 
    Net earnings
 
$
132.5
   
$
293.6
   
$
518.1
 
Dividends on stock-based plans
   
(.8
)
   
(1.5
) 
   
(1.3
)
    Undistributed earnings allocable
         to stock-based plans
   
(1.5
) 
   
(3.0
)
   
(5.1
)
Numerator for basic and
    diluted earnings per share – 
    net earnings available to
    common shareholders
 
 $
130.2
   
 $
289.1 
   
 $
511.7 
 
Denominator:
                       
    Denominator for basic
        earnings per share –
        weighted-average shares
   
59.6
     
59.8
     
64.3
 
Employee stock options
   
.3
     
.8
     
1.4
 
    Denominator for diluted
        earnings per share –
        adjusted weighted-average
        shares and assumed
        conversions
   
59.9
     
60.6
     
65.7
 
Basic earnings per share
 
$
2.18
   
$
4.83
   
$
7.96
 
Diluted earnings per share
 
$
2.17
   
$
4.77
   
$
7.78
 

The following options to purchase shares of common stock were outstanding during each year, but were not included in the computation of diluted earnings per share because the effect would be anti-dilutive. The options indicated in the following table were anti-dilutive because the related exercise price was greater than the average market price of the common shares for the year.
 
 
2009
 
2008
 
2007
 
Number of options (in millions)
   
4.8
     
2.6
     
1.6
 
Weighted-average exercise price
 
$
63.71
   
$
81.39
   
$
88.76
 
 
NOTE 16: STOCK-BASED COMPENSATION
 
The Corporation recognized total stock-based compensation costs of $69.8 million, $32.7 million, and $25.9 million in 2009, 2008, and 2007, respectively. These amounts are reflected in the Consolidated Statement of Earnings in selling, general, and administrative expenses, and in 2009, merger-related expenses. As more fully described in Note 2, stock-based compensation expense in 2009 includes approximately $42.3 million associated with the lapsing of the restriction on outstanding, but non-vested restricted stock and restricted stock units and the immediate vesting of certain stock options. The total income tax benefit for stock-based compensation arrangements was $18.4 million, $9.1 million, and $7.9 million in 2009, 2008, and 2007, respectively.
 
At December 31, 2009, unrecognized stock-based compensation expense totaled $20.1 million. The cost of these non-vested awards is expected to be recognized over a weighted-average period of 2.4 years. The Corporation’s stock-based employee compensation plans are described below.
 
Stock Option Plans:   Under various stock option plans, options to purchase common stock may be granted until 2013. Options are granted at fair market value at the date of grant, generally become exercisable in four equal installments beginning one year from the date of grant, and expire 10 years after the date of grant. The plans permit the issuance of either incentive stock options or non-qualified stock options.
 
 
 
24
 
 
 
Under all stock option plans, there were 597,964 shares of common stock reserved for future grants as of December 31, 2009. Transactions are summarized as follows:
 
 
STOCK
 OPTIONS
 
WEIGHTED-
  AVERAGE
 EXERCISE PRICE
 
Outstanding at December 31, 2006
   
6,036,012
   
$
55.68
 
Granted
   
790,470
     
88.38
 
Exercised
   
(1,406,664
)
   
49.75
 
Forfeited
   
(154,788
)
   
80.80
 
Outstanding at December 31, 2007
   
5,265,030
     
61.43
 
Granted
   
548,020
     
67.11
 
Exercised
   
(163,728
)
   
51.74
 
Forfeited
   
(149,128
)
   
83.80
 
Outstanding at December 31, 2008
   
5,500,194
     
61.68
 
Granted
   
795,940
     
38.28
 
Exercised
   
(1,342,211
)
   
42.04
 
Forfeited
   
(255,799
)
   
68.13
 
Outstanding at December 31, 2009
   
4,698,124
   
$
62.97
 
Options expected to vest at
    December 31, 2009
   
4,623,002
   
$
62.94
 
Options exercisable at
    December 31, 2009
   
3,800,872
   
$
63.08
 
 
 
 
 
25
 
 
 
As of December 31, 2009, the weighted average remaining contractual term was 5.9 years, 5.8 years, and 5.3 years for options outstanding, options expected to vest, and options exercisable, respectively. As of December 31, 2009, the aggregate intrinsic value was $51.7 million, $51.0 million, and $41.6 million for options outstanding, options expected to vest, and options exercisable. These preceding aggregate intrinsic values represent the total pretax intrinsic value (the difference between the Corporation’s closing stock price on the last trading day of 2009 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2009. These amounts will change based on the fair market value of the Corporation’s stock.
 
Cash received from option exercises in 2009, 2008, and 2007, was $57.4 million, $8.5 million, and $70.0 million, respectively. The Corporation has recognized $5.2 million, $.1 million, and $13.3 million, as a financing cash flow, within the caption “Issuance of common stock”, for the years ended December 31, 2009, 2008, and 2007, respectively, associated with the cash flows resulting from the tax benefits of tax deductions in excess of the compensation cost recognized for share-based arrangements.
 
The total intrinsic value of options exercised in 2009, 2008, and 2007, was $28.9 million, $2.5 million, and $59.0 million, respectively. The actual tax benefit realized for the tax deduction from option exercises totaled $9.8 million, $.9 million, and $20.4 million in 2009, 2008, and 2007, respectively.
 
The weighted-average grant-date fair values of options granted during 2009, 2008, and 2007, were $11.55 per share, $17.85 per share, and $22.98 per share, respectively. The fair value of options granted during 2009, 2008, and 2007 were determined using the Black-Scholes option valuation model with the following weighted-average assumptions:
 
 
  2009
 
  2008
 
  2007
 
Expected life in years
   
6.0
     
6.0
     
5.5
 
Interest rate
   
2.23
%
   
3.30
%
   
4.56
%
Volatility
   
35.4
%
   
30.7
%
   
25.3
%
Dividend yield
   
2.00
%
   
2.50
%
   
1.90
%
 
The Corporation has a share repurchase program that was implemented based on the belief that its shares were undervalued and to manage share growth resulting from option exercises. At December 31, 2009, the Corporation has remaining authorization from its Board of Directors to repurchase an additional 3,777,145 shares of its common stock. Under the terms of the definitive merger agreement to create Stanley Black & Decker, absent the consent of The Stanley Works, the Corporation has agreed not to repurchase shares of its common stock pending consummation of the merger.
 
Restricted Stock Plans:   Under two restricted stock plans, restricted stock or restricted stock units may be granted until 2018. Under these plans, eligible employees are awarded restricted stock or restricted stock units of the Corporation’s common stock. Restrictions on awards generally expire from three to four years after issuance, subject to continuous employment and certain other conditions. Transactions are summarized as follows:
 
 
NUMBER
 OF SHARES
 
WEIGHTED-
  AVERAGE
  FAIR VALUE AT
 GRANT DATE
 
Non-vested at December 31, 2006
   
618,038
   
$
76.32
 
Granted
   
266,537
     
88.53
 
Forfeited
   
(46,425
)
   
81.04
 
Vested
   
(157,056
)
   
56.10
 
Non-vested at December 31, 2007
   
681,094
     
85.43
 
Granted
   
347,175
     
66.62
 
Forfeited
   
(53,592
)
   
82.20
 
Vested
   
(50,263
)
   
56.16
 
Non-vested at December 31, 2008
   
924,414
     
80.15
 
Granted
   
584,560
     
38.29
 
Forfeited
   
(54,005
)
   
74.16
 
Vested
   
(1,115,269
)
   
63.85
 
Non-vested at December 31, 2009
   
339,700
   
$
62.57
 
 
The fair value of the shares vested during 2009, 2008, and 2007 were $63.1 million, $3.3 million, and $14.5 million, respectively.
 
Under all restricted stock plans, 647,891 shares of common stock were reserved for future grants at December 31, 2009.
 
Other Stock-based Compensation Plans: The Corporation has an Executive Long-Term Incentive/Retention Plan. As more fully described in Note 2, the terms of the Executive Long-Term Incentive/Retention Plan were amended during 2009 whereby the previous adjustment to cash payouts under the plan, based upon upward or downward movements in the Corporation’s average common stock price as compared to $67.78, was removed. Prior to this amendment the awards were payable in cash but indexed to the fair market value of the Corporation’s common stock. Vesting of the awards generally occurs three years after the awards are made. Awards under this plan would vest upon consummation of the proposed merger.
 
The Corporation also has a Performance Equity Plan (PEP) under which awards payable in the Corporation’s common stock are made. Vesting of the awards, which can range from 0% to 150% of the initial award, is based on pre-established financial performance measures during a two-year performance period. The fair value of the shares that vested during 2009, 2008, and 2007 was $— million, $.1 million, and $4.4 million, respectively. During 2007, the Corporation granted 41,880 performance shares under the PEP. During 2009 and 2008, there were no performance shares granted by the Corporation under the PEP. At December 31, 2009 and 2008, there were no performance shares outstanding under the PEP.
 
 
 
 
26
 
 
 
NOTE 17: BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION
 
The Corporation has elected to organize its businesses based principally upon products and services. In certain instances where a business does not have a local presence in a particular country or geographic region, however, the Corporation has assigned responsibility for sales of that business’s products to one of its other businesses with a presence in that country or region.
 
The Corporation operates in three reportable business segments: Power Tools and Accessories, Hardware and Home Improvement, and Fastening and Assembly Systems. The Power Tools and Accessories segment has worldwide responsibility for the manufacture and sale of consumer and industrial power tools and accessories, lawn and garden products, and electric cleaning, automotive, lighting, and household products, as well as for product service. In addition, the Power Tools and Accessories segment has responsibility for the sale of security hardware to customers in Mexico, Central America, the Caribbean, and South America; for the sale of plumbing products to customers outside the United States and Canada; and for sales of household products. The Hardware and Home Improvement segment has worldwide responsibility for the manufacture and sale of security hardware (except for the sale of security hardware in Mexico, Central America, the Caribbean, and South America). The Hardware and Home Improvement segment also has responsibility for the manufacture of plumbing products and for the sale of plumbing products to customers in the United States and Canada. The Fastening and Assembly Systems segment has worldwide responsibility for the manufacture and sale of fastening and assembly systems. On September 9, 2008, the Corporation acquired Spiralock Corporation (Spiralock), a component of the Fastening and Assembly Systems segment.
 
 
Business Segments
(Millions of Dollars)
 
   
Reportable Business Segments
                   
Year Ended December 31, 2009
 
Power
Tools & Accessories
   
Hardware
& Home Improvement
   
Fastening 
& Assembly Systems
   
Total
   
Currency Translation Adjustments
   
Corporate,
Adjustment,
& Eliminations
   
Consolidated
 
Sales to unaffiliated customers
  $ 3,471.5     $ 755.4     $ 536.6     $ 4,763.5     $ 11.6     $ —     $ 4,775.1  
Segment profit (loss)
    (for consolidated, 
    operating
    income before 
    merger-related
    expenses
    and restructuring
    and exit costs)
    257.3       76.9       39.5       373.7       13.5       (67.1 )     320.1  
Depreciation and
     amortization
    85.1       18.8       22.0       125.9       .6       1.5       128.0  
Income from equity method
     investees
    21.3       —       —       21.3       —       (1.9 )     19.4  
Capital expenditures
    41.3       13.2       7.4       61.9       .3       .9       63.1  
Segment assets
    (for Consolidated,
    total assets)
    2,108.2       503.9       388.8       3,000.9       85.9       2,408.4       5,495.2  
Investment in equity method
     investees
    28.1       —       .6       28.7       —       (1.7 )     27.0  
                                                         
Year Ended December 31, 2008
                                                       
Sales to unaffiliated
    customers
  $ 4,286.6     $ 891.6     $ 703.2     $ 5,881.4     $ 204.7     $ —     $ 6,086.1  
Segment profit (loss)
    (for Consolidated,
    operating
    income before
    restructuring and exit 
    costs)
    317.4       75.8       106.0       499.2       29.4       (51.8 )     476.8  
Depreciation and
    amortization
    89.9       20.6       21.6       132.1       3.4       1.1       136.6  
Income from equity method
    investees
    12.0       —       —       12.0       —       (.9 )     11.1  
Capital expenditures
    56.6       16.5       18.6       91.7       2.3       4.8       98.8  
Segment assets
    (for Consolidated,
    total assets)
    2,492.6       571.7       433.1       3,497.4       (11.8 )     1,697.7       5,183.3  
Investment in equity method
     investees
    26.8       —       .5       27.3       —       (1.7 )     25.6  
                                                         
 
 
 
 
27
 
 
 
 
Reportable Business Segments
                   
 
 
Power
Tools & Accessories
   
Hardware
& Home Improvement
   
Fastening 
& Assembly Systems
   
Total
   
Currency Translation Adjustments
   
Corporate,
Adjustment,
& Eliminations
   
Consolidated
 
Year Ended December 31, 2007
                                                       
Sales to unaffiliated customers
  $ 4,754.8     $ 1,001.7     $ 720.7     $ 6,477.2     $ 86.0     $ —     $ 6,563.2  
Segment profit (loss)
    (for Consolidated,
    operating income before
    restructuring and
    exit costs)
    482.2       113.6       113.9       709.7       (2.3 )     (106.2 )     601.2  
Depreciation and
    amortization
    96.7       22.8       20.5       140.0       .5       2.9       143.4  
Income from equity method
    investees
    12.7       —       —       12.7       —       (1.0 )     11.7  
Capital expenditures
    65.0       20.8       22.2       108.0       .5       7.9       116.4  
Segment assets
     (for Consolidated,
     total assets)
    2,654.2       653.7       406.6       3,714.5       135.5       1,560.9       5,410.9  
Investment in equity method
      investees
    15.6       —       .5       16.1       —       (1.7 )     14.4  
 
 
 
 
28
 
 
 
The profitability measure employed by the Corporation and its chief operating decision maker for making decisions about allocating resources to segments and assessing segment performance is segment profit (for the Corporation on a consolidated basis, operating income before restructuring and exit costs). In general, segments follow the same accounting policies as those described in Note 1, except with respect to foreign currency translation and except as further indicated below. The financial statements of a segment’s operating units located outside of the United States, except those units operating in highly inflationary economies, are generally measured using the local currency as the functional currency. For these units located outside of the United States, segment assets and elements of segment profit are translated using budgeted rates of exchange. Budgeted rates of exchange are established annually and, once established, all prior period segment data is restated to reflect the current year’s budgeted rates of exchange. The amounts included in the preceding table under the captions “Reportable Business Segments” and “Corporate, Adjustments, & Eliminations” are reflected at the Corporation’s budgeted rates of exchange for 2008. The amounts included in the preceding table under the caption “Currency Translation Adjustments” represent the difference between consolidated amounts determined using those budgeted rates of exchange and those determined based upon the rates of exchange applicable under accounting principles generally accepted in the United States.
 
Segment profit excludes interest income and expense, non-operating income and expense, adjustments to eliminate intercompany profit in inventory, and income tax expense. In addition, segment profit excludes merger-related expenses and restructuring and exit costs. In determining segment profit, expenses relating to pension and other postretirement benefits are based solely upon estimated service costs. Corporate expenses, as well as certain centrally managed expenses, including expenses related to share-based compensation, are allocated to each reportable segment based upon budgeted amounts. While sales and transfers between segments are accounted for at cost plus a reasonable profit, the effects of intersegment sales are excluded from the computation of segment profit. Intercompany profit in inventory is excluded from segment assets and is recognized as a reduction of cost of goods sold by the selling segment when the related inventory is sold to an unaffiliated customer. Because the Corporation compensates the management of its various businesses on, among other factors, segment profit, the Corporation may elect to record certain segment-related expense items of an unusual non-recurring nature in consolidation rather than reflect such items in segment profit. In addition, certain segment-related items of income or expense may be recorded in consolidation in one period and transferred to the various segments in a later period.
 
Segment assets exclude pension and tax assets, intercompany profit in inventory, intercompany receivables, and goodwill associated with the Corporation’s acquisition of Emhart Corporation in 1989.
 
The reconciliation of segment profit to consolidated earnings before income taxes for each year, in millions of dollars, is as follows:
 
 
2009
 
2008
 
2007
 
Segment profit for total
reportable business segments
 
$
373.7
   
$
499.2
   
$
709.7
 
Items excluded from segment profit:
                       
    Adjustment of budgeted foreign
         exchange rates to actual rates
   
13.5
     
29.4
     
(2.3
)
    Depreciation of Corporate property
   
(1.5
)
   
(1.1
)
   
(1.4
)
    Adjustment to businesses’ postretirement
         benefit expenses booked in consolidation
   
(12.0
)
   
(3.6
)
   
(19.9
)
    Other adjustments booked in consolidation
        directly related to reportable business segments
   
(.3
)
   
(4.9
)
   
8.3
 
    Amounts allocated to businesses in arriving at
        segment profit in excess of (less than) Corporate
        center operating expenses, eliminations, and other
        amounts identified above
   
(53.3
)
   
(42.2
)
   
(93.2
)
Operating income before merger-related expenses
    and restructuring and exit costs
   
320.1
     
476.8
     
601.2
 
Merger-related expenses 
   
58.8
     
—
     
—
 
Restructuring and exit costs
   
11.9
     
54.7
     
19.0
 
Operating income
   
249.4
     
422.1
     
582.2
 
Interest expense, net of interest income
   
83.8
     
62.4
     
82.3
 
Other (income) expense
   
(4.8
)
   
(5.0
)
   
2.3
 
Earnings before income taxes
 
$
170.4
   
$
364.7
   
$
497.6
 
 
The reconciliation of segment assets to consolidated total assets at the end of each year, in millions of dollars, is as follows:
 
 
2009
 
2008
 
2007
 
Segment assets for total reportable
     business segments
 
$
3,000.9
   
$
3,497.4
   
$
3,714.5
 
Items excluded from segment assets:
                       
    Adjustment of budgeted foreign
        exchange rates to actual rates
   
85.9
     
(11.8
) 
   
135.5
 
    Goodwill
   
636.6
     
633.8
     
640.5
 
    Pension assets
   
—
     
17.5
     
76.6
 
Other Corporate assets
   
1,771.8
     
1,046.4
     
843.8
 
   
$
5,495.2
   
$
5,183.3
   
$
5,410.9
 
 
Other Corporate assets principally consist of cash and cash equivalents, tax assets, property, and other assets.
 
 
 
29
 
 
 
Sales to The Home Depot, a customer of the Power Tools and Accessories and Hardware and Home Improvement segments, accounted for approximately $.8 billion, $1.0 billion, and $1.3 billion of the Corporation’s consolidated sales for the years ended December 31, 2009, 2008, and 2007, respectively. Sales to Lowe’s Companies, Inc., a customer of the Power Tools and Accessories and Hardware and Home Improvement segments, accounted for approximately $.7 billion, $.8 billion, and $.9 billion of the Corporation’s consolidated sales for the years ended December 31, 2009, 2008, and 2007, respectively.
 
The composition of the Corporation’s sales by product group for each year, in millions of dollars, is set forth below:
 
 
2009
 
2008
 
2007
 
Consumer and industrial power
     tools and product service
 
$
2,449.2
   
$
3,236.1
   
$
3,537.3
 
Lawn and garden products
   
312.1
     
377.9
     
430.6
 
Consumer and industrial accessories
   
392.6
     
452.0
     
479.2
 
Cleaning, automotive, lighting, and
     household products
   
266.7
     
321.0
     
345.3
 
Security hardware
   
552.5
     
649.9
     
730.9
 
Plumbing products
   
248.0
     
309.2
     
323.3
 
Fastening and assembly systems
   
554.0
     
740.0
     
716.6
 
   
$
4,775.1
   
$
6,086.1
   
$
6,563.2
 
 
The Corporation markets its products and services in over 100 countries and has manufacturing sites in 12 countries. Other than in the United States, the Corporation does not conduct business in any country in which its sales in that country exceed 10% of consolidated sales. Sales are attributed to countries based on the location of customers. The composition of the Corporation’s sales to unaffiliated customers between those in the United States and those in other locations for each year, in millions of dollars, is set forth below:
 
 
2009
 
2008
 
2007
 
United States
 
$
2,705.5
   
$
3,358.6
   
$
3,930.2
 
Canada
   
275.7
     
382.3
     
361.8
 
North America
   
2,981.2
     
3,740.9
     
4,292.0
 
Europe
   
1,076.7
     
1,516.0
     
1,568.0
 
Other
   
717.2
     
829.2
     
703.2
 
   
$
4,775.1
   
$
6,086.1
   
$
6,563.2
 
 
The composition of the Corporation’s property, plant, and equipment between those in the United States and those in other countries as of the end of each year, in millions of dollars, is set forth below:
 
 
2009
 
2008
 
2007
 
United States
 
$
195.4
   
$
217.7
   
$
259.6
 
Mexico
   
71.5
     
98.3
     
106.8
 
Other countries
   
206.5
     
211.9
     
229.8
 
   
$
473.4
   
$
527.9
   
$
596.2
 
 
NOTE 18: LEASES
 
The Corporation leases certain service centers, offices, warehouses, manufacturing facilities, and equipment. Generally, the leases carry renewal provisions and require the Corporation to pay maintenance costs. Rental payments may be adjusted for increases in taxes and insurance above specified amounts. Rental expense for 2009, 2008, and 2007 amounted to $96.7 million, $104.6 million, and $103.6 million, respectively. Capital leases were immaterial in amount. Future minimum payments under non-cancelable operating leases with initial or remaining terms of more than one year as of December 31, 2009, in millions of dollars, were as follows:
 
     
2010
 
$
65.6
 
2011
   
47.6
 
2012
   
36.0
 
2013
   
20.4
 
2014
   
14.2
 
Thereafter
   
12.1
 
   
$
195.9
 
 
 
 
 
 
30
 
 
NOTE 19: RESTRUCTURING ACTIONS
 
A summary of restructuring activity during the three years ended December 31, 2009, in millions of dollars, is set forth below:
 
 
SEVERANCE
 BENEFITS
 
WRITE-DOWN
  TO FAIR VALUE
  LESS COSTS
  TO SELL
  OF CERTAIN
  LONG-LIVED
 ASSETS
 
OTHER
 CHARGES
 
TOTAL
 
Restructuring reserve at December 31, 2006
 
$
2.8
   
$
—
   
$
.4
   
$
3.2
 
Reserves established in 2007
   
14.8
     
4.0
     
.2
     
19.0
 
Utilization of reserves:
                               
    Cash
   
(1.0
)
   
—
     
—
     
(1.0
)
    Non-cash
   
—
     
(4.0
)
   
—
     
(4.0
)
Foreign currency translation
   
.1
     
—
     
—
     
.1
 
Restructuring reserve at December 31, 2007
   
16.7
     
—
     
.6
     
17.3
 
Reserves established in 2008
   
48.3
     
3.7
     
2.7
     
54.7
 
Utilization of reserves:
                               
    Cash
   
(24.9
)
   
—
     
(.4
)
   
(25.3
)
    Non-cash
   
—
     
(3.7
)
   
(.9
)
   
(4.6
)
Foreign currency translation
   
(4.5
)
   
—
     
—
     
(4.5
)
Restructuring reserve at December 31, 2008
   
35.6
     
—
     
2.0
     
37.6
 
Reserves established in 2009
   
12.6
     
.4
     
1.2
     
14.2
 
Reversal of reserves
   
(1.8
)
   
 —
     
(.5
) 
   
(2.3
) 
Utilization of reserves:
                               
    Cash
   
(37.9
)
   
—
     
(1.9
)
   
(39.8
)
    Non-cash
   
—
     
(.4
)
   
—
     
(.4
)
Foreign currency translation
   
1.2
     
—
     
—
     
1.2
 
Restructuring reserve at December 31, 2009
 
$
9.7
   
$
—
   
$
.8
   
$
10.5
 
 
 
 
 
31
 
 
 
During 2009, the Corporation recognized $14.2 million of pre-tax restructuring and exit costs related to actions taken in its Power Tools and Accessories, Hardware and Home Improvement, and Fastening and Assembly segments. The $14.2 million charge recognized during 2009 was offset; however, by the reversal of $1.8 million of severance and $.5 million of other accruals established as part of previously provided restructuring reserves that were no longer required. The 2009 restructuring charge related to the elimination of direct and indirect manufacturing positions as well as selling, general, and administrative positions. A severance benefits accrual of $12.6 million was included in the restructuring charge, of which $8.9 million related to the Power Tools and Accessories segment, $2.3 million related to the Fastening and Assembly Systems segment and $1.4 million related to the Hardware and Home Improvement segment. The severance benefits accrual included the elimination of approximately 1,500 positions including approximately 1,200 manufacturing related positions. The restructuring charge also included a $.4 million write-down to fair value of certain long-lived assets for the Hardware and Home Improvement segment. In addition, the restructuring charge reflected $.3 million and $.9 million related to the early termination of lease agreements by the Power Tools and Accessories segment and Fastening and Assembly Systems segment, respectively, necessitated by the restructuring actions.
 
During 2008, the Corporation recorded a restructuring charge of $54.7 million, reflecting actions to reduce its manufacturing cost base and selling, general, and administrative expenses. The principal components of this restructuring charge related to the elimination of direct and indirect manufacturing positions as well as selling, general, and administrative positions. As a result, a severance benefits accrual of $48.3 million was included in the restructuring charge, of which $36.4 million related to the Power Tools and Accessories segment, $5.4 million related to the Hardware and Home Improvement segment, and $6.0 million related to the Fastening and Assembly Systems segment, as well as $.5 million related to certain Corporate functions. The severance benefits accrual included the elimination of approximately 2,300 positions including approximately 1,400 manufacturing-related positions. The Corporation estimates that, as a result of increases in manufacturing employee headcount in other facilities, approximately 200 replacement positions will be filled, yielding a net total of approximately 2,100 positions eliminated as a result of the 2008 restructuring actions. The restructuring charge also included a $3.7 million write-down to fair value of certain long-lived assets for the Power Tools and Accessories segment ($3.0 million) and Hardware and Home Improvement segment ($.7 million), which were either held for sale or idled in preparation for disposal. As part of these restructuring actions, the Power Tools and Accessories segment closed its manufacturing facility in Decatur, Arkansas, and transferred production to another facility. The actions to reduce the Corporation’s manufacturing cost base in its Hardware and Home Improvement segment included the transfer of production from a facility in Mexico to a facility in China. The restructuring charge also reflected $1.8 million related to the early termination of a lease agreement by the Power Tools and Accessories segment necessitated by restructuring actions. The restructuring charge also included a $.9 million non-cash curtailment charge associated with the restructuring actions.
 
During 2007, the Corporation recorded a restructuring charge of $19.0 million. The $19.0 million was net of $3.4 million representing the excess of proceeds received on the sale of a manufacturing facility which will be closed as part of the restructuring actions, over its carrying value. The 2007 restructuring charge reflected actions to reduce the Corporation’s manufacturing cost base and selling, general and administrative expenses in its Power Tools and Accessories and Hardware and Home Improvement segments. The restructuring actions to reduce the Corporation’s manufacturing cost base in the Power Tools and Accessories segment included the closure of one facility, transferring production to other facilities, and outsourcing certain manufactured items. Actions to reduce the Corporation’s manufacturing cost base in the Hardware and Home Improvement segment primarily related to optimization of its North American finishing operations.
 
The principal component of the 2007 restructuring charge related to the elimination of manufacturing and selling, general and administrative positions. As a result, a severance benefit accrual of $14.8 million, related to the Power Tools and Accessories segment ($12.4 million) and the Hardware and Home Improvement segment ($2.4 million), was included in the restructuring charge. The severance benefits accrual included the elimination of approximately 650 positions. The Corporation estimated that, as a result of increases in manufacturing employee headcount in other facilities, approximately 100 replacement positions were filled, yielding a net total of approximately 550 positions eliminated as a result of the 2007 restructuring actions. The restructuring reserve also included a $7.4 million write-down to fair value of certain long-lived assets of the Hardware and Home Improvement segment, which were either held for sale or have been idled in preparation for disposal as of December 31, 2007.
 
During 2009, 2008, and 2007 the Corporation paid severance and other exit costs related to restructuring charges taken of $39.8 million, $25.3 million and $1.0 million, respectively.
 
 
 
 
32
 
 
 
Of the remaining $10.5 million restructuring accrual at December 31, 2009, $7.0 million relates to the Power Tools and Accessories segment, $2.4 million relates to the Fastening and Assembly Systems segment and $1.1 million relates to the Hardware and Home Improvement segment. The Corporation anticipates that the remaining actions contemplated under that $10.5 million accrual will be completed during  2010.  As of December 31, 2009, the carrying value of long-lived assets held for sale was not significant.
 
NOTE 20: OTHER (INCOME) EXPENSE
 
Other (income) expense was $(4.8) million in 2009, $(5.0) million in 2008, and $2.3 million in 2007.
 
Other (income) expense for the year ended December 31, 2009, includes a $6.0 million settlement on an insurance settlement related to an environmental matter. Other (income) expense for the year ended December 31, 2008, benefited from a gain on the sale of a non-operating asset.
 
NOTE 21: LITIGATION AND CONTINGENT LIABILITIES
 
The Corporation is involved in various lawsuits in the ordinary course of business. These lawsuits primarily involve claims for damages arising out of the use of the Corporation’s products and allegations of patent and trademark infringement. The Corporation also is involved in litigation and administrative proceedings involving employment matters and commercial disputes. Some of these lawsuits include claims for punitive as well as compensatory damages.
 
The Corporation, using current product sales data and historical trends, actuarially calculates the estimate of its exposure for product liability. The Corporation is insured for product liability claims for amounts in excess of established deductibles and accrues for the estimated liability up to the limits of the deductibles. All other claims and lawsuits are handled on a case-by-case basis. The Corporation’s estimate of the costs associated with product liability claims, environmental exposures, and other legal proceedings is accrued if, in management’s judgment, the likelihood of a loss is probable and the amount of the loss can be reasonably estimated.
 
The Corporation also is party to litigation and administrative proceedings with respect to claims involving the discharge of hazardous substances into the environment. Some of these assert claims for damages and liability for remedial investigations and clean-up costs with respect to sites that have never been owned or operated by the Corporation but at which the Corporation has been identified as a potentially responsible party. Other matters involve current and former manufacturing facilities.
 
The EPA and the Santa Ana Regional Water Quality Control Board have each initiated administrative proceedings against the Corporation and certain of the Corporation’s current or former affiliates alleging that the Corporation and numerous other defendants are responsible to investigate and remediate alleged groundwater contamination in and adjacent to a 160-acre property located in Rialto, California. The United States of America, the cities of Colton and Rialto, and certain other PRPs have also initiated lawsuits (and/or asserted cross and counter-claims against the Corporation and certain of the Corporation’s former or current affiliates) that are currently pending in the United States District Court for the Central District of California (collectively, the “Litigation”). In the Litigation, the various parties allege that the Corporation is liable under CERCLA, the Resource Conservation and Recovery Act, and various state laws for the discharge or release of hazardous substances into the environment and the contamination caused by those alleged releases. The Corporation, in turn, through certain of the aforementioned affiliates, has also initiated a lawsuit in the United States District Court for the Central District of California alleging that various other PRPs are liable for the alleged contamination at issue. The City of Colton also has a companion case in California State court, which is currently stayed for all purposes. Certain defendants in that case have cross-claims against other defendants and have asserted claims against the State of California. The administrative proceedings and the lawsuits generally allege that West Coast Loading Corporation (WCLC), a defunct company that operated in Rialto between 1952 and 1957, and an as yet undefined number of other defendants are responsible for the release of perchlorate and solvents into the groundwater basin, and that the Corporation and certain of the Corporation’s current or former affiliates are liable as a “successor” of WCLC. The Corporation believes that neither the facts nor the law support an allegation that the Corporation is responsible for the contamination and is vigorously contesting these claims.
 
The EPA has provided an affiliate of the Corporation a “Notice of Potential Liability” related to environmental contamination found at the Centredale Manor Restoration Project Superfund site, located in North Providence, Rhode Island. The EPA has discovered dioxin, polychlorinated biphenyls, and pesticide contamination at this site. The EPA alleged that an affiliate of the Corporation is liable for site cleanup costs under CERCLA as a successor to the liability of Metro-Atlantic, Inc., a former operator at the site, and demanded reimbursement of the EPA’s costs related to this site. The EPA, which considers the Corporation to be the primary potentially responsible party (PRP) at the site, is expected to release a draft Feasibility Study Report, which will identify and evaluate remedial alternatives for the site, in 2010. At December 31, 2009, the estimated remediation costs related to this site (including the EPA’s past costs as well as costs of additional investigation, remediation, and related costs, less escrowed funds contributed by PRPs who have reached settlement agreements with the EPA), which the Corporation considers to be probable and can be reasonably estimable, range from approximately $50.5 million to approximately $100 million, with no amount within that range representing a more likely outcome. The Corporation’s reserve for this matter at December 31, 2009 is $50.5 million. During 2007, the Corporation increased its reserve for this environmental remediation matter by $31.7 million to $48.7 million, reflecting the probability that the Corporation will be identified as the principal financially viable PRP upon issuance of the EPA draft Feasibility Study Report. The Corporation has not yet determined the extent to which it will contest the EPA’s claims with respect to this site. Further, to the extent that the Corporation agrees to perform or finance remedial activities at this site, it will seek participation or contribution from additional PRPs and insurance carriers. As the specific nature of the environmental remediation activities that may be mandated by the EPA at this site have not yet been determined, the ultimate remedial costs associated with the site may vary from the amount accrued by the Corporation at December 31, 2009.
 
 
 
33
 
 
 
As of December 31, 2009, the Corporation’s aggregate probable exposure with respect to environmental liabilities, for which accruals have been established in the consolidated financial statements, was $102.1 million. These accruals are reflected in other current liabilities and other long-term liabilities in the Consolidated Balance Sheet.
 
Total future costs for environmental remediation activities will depend upon, among other things, the identification of any additional sites, the determination of the extent of contamination at each site, the timing and nature of required remedial actions, the technologies available, the nature and terms of cost sharing arrangements with other PRPs, the existing legal requirements and nature and extent of future environmental laws, and the determination of the Corporation’s liability at each site. The recognition of additional losses, if and when they may occur, cannot be reasonably predicted.
 
In the opinion of management, amounts accrued for exposures relating to product liability claims, environmental matters, income tax matters, and other legal proceedings are adequate and, accordingly, the ultimate resolution of these matters is not expected to have a material adverse effect on the Corporation’s consolidated financial statements. As of December 31, 2009, the Corporation had no known probable but inestimable exposures relating to product liability claims, environmental matters, income tax matters, or other legal proceedings that are expected to have a material adverse effect on the Corporation. There can be no assurance, however, that unanticipated events will not require the Corporation to increase the amount it has accrued for any matter or accrue for a matter that has not been previously accrued because it was not considered probable. While it is possible that the increase or establishment of an accrual could have a material adverse effect on the financial results for any particular fiscal quarter or year, in the opinion of management there exists no known potential exposure that would have a material adverse effect on the financial condition or on the financial results of the Corporation beyond any such fiscal quarter or year.
 
NOTE 22: QUARTERLY RESULTS (UNAUDITED)
 
(DOLLARS IN MILLIONS EXCEPT PER SHARE DATA)
YEAR ENDED DECEMBER 31, 2009
FIRST
 QUARTER
 
SECOND
 QUARTER
 
THIRD
 QUARTER
 
FOURTH
 QUARTER
 
Sales
 
$
1,073.7
   
$
1,191.4
   
$
1,208.7
   
$
1,301.3
 
Gross margin
   
340.8
     
372.2
     
400.3
     
473.2
 
Net earnings
   
4.9
     
38.3
     
55.4
     
33.9
 
Net earnings per common share–basic
 
$
.08
   
$
.63
   
$
.91
   
$
.56
 
Net earnings per common share–diluted
 
$
.08
   
$
.63
   
$
.91
   
$
.55
 
 
YEAR ENDED DECEMBER 31, 2008
FIRST
 QUARTER
 
SECOND
 QUARTER
 
THIRD
 QUARTER
 
FOURTH
 QUARTER
 
Sales
 
$
1,495.8
   
$
1,641.7
   
$
1,570.8
   
$
1,377.8
 
Gross margin
   
517.5
     
537.2
     
508.9
     
434.8
 
Net earnings
   
67.4
     
96.7
     
85.8
     
43.7
 
Net earnings per common share–basic
 
$
1.10
   
$
1.58
   
$
1.43
   
$
.72
 
Net earnings per common share–diluted
 
$
1.08
   
$
1.56
   
$
1.41
   
$
.72
 
 
As more fully described in Note 2, net earnings for the fourth quarter of 2009, included a pre-tax charge of $58.8 million ($42.6 million after taxes) associated with the Corporation’s proposed merger with The Stanley Works. As more fully described in Note 19, net earnings for the first quarter of 2009 included a pre-tax restructuring charge of $11.9 million ($8.4 million after taxes).
 
As more fully described in Note 19, net earnings for the first, third, and fourth quarter of 2008 included a pre-tax restructuring charge of $18.3 million, $15.6 million and $20.8 million, respectively ($12.2 million, $12.6 million, and $14.8 million, respectively, after taxes).
 
Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarters may not be equal to the full year earnings per share.
 
 
 
34
 
 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON CONSOLIDATED FINANCIAL STATEMENTS
 
To the Stockholders and Board of Directors
of The Black & Decker Corporation and Subsidiaries:
 
We have audited the accompanying consolidated balance sheet of The Black & Decker Corporation and Subsidiaries as of December 31, 2009 and 2008, and the related consolidated statements of earnings, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2009. Our audits also included the financial statement schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of The Black & Decker Corporation and Subsidiaries at December 31, 2009 and 2008, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2009, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
 
As discussed in Note 1 to the consolidated financial statements, the Corporation, effective December 31, 2008, adopted a new accounting standard that required the Corporation to change the measurement date for defined benefit pension and postretirement plan assets and liabilities to coincide with its year-end.
 
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), The Black & Decker Corporation and Subsidiaries’ internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 19, 2010 expressed an unqualified opinion thereon.
 

 
/s/ ERNST & YOUNG, LLP
Baltimore, Maryland
February 19, 2010
 
 
 
 
35