Amendment No. 3 to Note Agreement, dated as of January 11, 2006



 Exhibit 4.4(iv) 
  
 BARNES GROUP INC. 
  
 AMENDMENT NO. 3 TO NOTE AGREEMENT 
  
 As of January 11, 2006 
  
 To each of the Current Noteholders 
 Named in Annex 1 hereto

  
 Ladies and Gentlemen: 
  
 Barnes Group Inc., a Delaware corporation (hereinafter, the
“Company”), together with its successors and assigns, agrees with you as follows: 
  

	1.	PRELIMINARY STATEMENTS. 

  

	 	1.1	Note Issuance, etc. 

  
 The Company issued and sold $60,000,000 aggregate principal amount of its 8.59% Senior Notes due November 21, 2008 (as may be amended, restated or
otherwise modified from time to time, the “Notes”) pursuant to separate Note Agreements, each dated as of November 21, 2000, entered into by and among the Company and each of the Purchasers listed on Exhibit A attached thereto,
as amended by Amendment No. 1 to Note Agreement, dated as of February 21, 2002 between the Company and each of the Persons identified on Annex 1 attached thereto, and Amendment No. 2, dated as of February 5, 2003 between the
Company and each of the Persons identified on Annex 1 attached thereto (the “Existing Note Agreement” and, as amended by this Amendment No. 3 to Note Agreement (this “Amendment Agreement”), the “Note
Agreement”). The register for the registration and transfer of the Notes indicates that the Persons named in Annex 1 hereto (collectively, the “Current Noteholders”) are currently the holders of the outstanding principal
amount of the Notes as set forth next to such holder’s name on Annex 1. 
  

	2.	DEFINED TERMS. 

  
 Capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in the Note Agreement. 
  

	3.	AMENDMENT. 

  
 Subject to Section 5, the Existing Note Agreement is amended as provided for by this Amendment Agreement in the manner specified in Exhibit A (the
“Amendment”). 










	4.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY. 

  
 To induce you to enter into this Amendment Agreement and to consent to the Amendment, the Company represents and warrants as follows: 
  

	 	4.1.	Organization, Power and Authority, etc. 

  
 The Company is a corporation duly incorporated and validly existing and in good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to enter into and perform its obligations under this Amendment Agreement. 
  

	 	4.2.	Legal Validity. 

  
 The execution and delivery of this Amendment Agreement by the Company and compliance by the Company with its obligations hereunder: (a) are within
the corporate powers of the Company; and (b) are legal and do not conflict with, result in any breach of, constitute a default under, or result in the creation of any Lien upon any Property of the Company under the provisions of: (i) any
charter instrument or bylaw to which the Company is a party or by which the Company or any of its Properties may be bound; (ii) any order, judgment, decree or ruling of any court, arbitrator or governmental authority applicable to either the
Company or any of its Properties; or (iii) any agreement or instrument to which the Company is a party or by which the Company or any of its Properties may be bound or any statute or other rule or regulation of any governmental authority
applicable to the Company or any of its Properties. 
  
 This
Amendment Agreement has been duly authorized by all necessary action on the part of the Company, has been executed and delivered by a duly authorized officer of the Company, and constitutes a legal, valid and binding obligation of the Company,
enforceable in accordance with its terms, except that enforceability may be limited by applicable bankruptcy, reorganization, arrangement, insolvency, moratorium, or other similar laws affecting the enforceability of creditors’ rights generally
and subject to the availability of equitable remedies. 
  

	 	4.3.	No Defaults. 

  
 No event has occurred and no condition exists that, upon the execution and delivery of this Amendment Agreement, would constitute a Default or an Event of
Default. 
  

	5.	EFFECTIVENESS OF AMENDMENT. 

  
 The Amendment shall become effective as of the first date written above (the “Effective Date”) upon: 
  
 (a) execution and delivery of a counterpart of this Amendment Agreement by
the Company and by holders of 66-2/3% of aggregate outstanding principal amount of Notes; 
  
 (b) delivery by the Company of a fully executed copy of the Sharing Agreement, dated the date hereof, by and among the banks listed on the signature pages thereto, Bank of 

  

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America, N.A., as agent, the Current Noteholders and holders of the notes issued under the 2000 Note Agreement; in form and substance satisfactory to the
Current Noteholders; 
  
 (c) delivery by the Company to the
Current Noteholders’ counsel of a fully executed copy of the Second Amended and Restated $175,000,000 Senior Unsecured Revolving Credit Agreement, dated as of January 11, 2006, by and among Bank of America, N.A., as administrative agent,
the lenders listed on Schedule 1 attached thereto, the Company, Barnes Switzerland, Banc of America Securities LLC, as arranger, Keybank National Association, as syndication agent and HSBC Bank USA and Webster Bank, National Association, as
co-documentation agents, in form and substance satisfactory to the Current Noteholders; 
  
 (d) delivery by the Company to the Current Noteholders’ counsel of a fully executed copy of an amendment, dated the date hereof to those separate Note Agreements, each dated as of November 12, 1999, (as
amended by Amendment No. 1 to Note Agreement, dated as of February 5, 2003 entered into by and among 3031786 Nova Scotia Company (“3031786”) and each of the Purchasers listed on Schedule A attached thereto and by the
Assumption and Amendment Agreement, dated as of August 26, 2005, by and among 3031786, the Company and each the Persons identified on Schedule A and Schedule B attached thereto, whereby the Company assumed the obligations of 3031786 under the
said 1999 Note Agreement and the Nova Scotia Notes) (the “1999 Note Agreement”); 
  
 (e) delivery by the Company to the Current Noteholders’ counsel of an Officer’s Certificate, dated the Effective Date, certifying that the
conditions specified in Sections 4.1 and 4.2 have been fulfilled; 
  
 (f) delivery by the Company to the Current Noteholders’ counsel of a certificate of its Secretary or one of its Assistant Secretaries, dated the Effective Date, certifying as to the resolutions attached thereto and other corporate
proceedings relating to the authorization, execution and delivery of this Amendment Agreement; 
  
 (g) the Company shall have paid the fees and expenses of the Current Noteholders’ special counsel and the amendment fee as provided in Section 6; and 
  
 (h) all proceedings taken in connection with this Amendment Agreement and all
documents and papers relating thereto shall be satisfactory to the Current Noteholders and their counsel, and the Current Noteholders and their counsel shall have received copies of such other documents and papers as the Current Noteholders or their
counsel may reasonably request in connection herewith. 
  

	6.	EXPENSES. 

  
 6.1 Payment of Special Counsel Fees. 
  
 Whether or not the Amendment becomes effective, the Company will promptly (and in any event within thirty days of receiving any statement or invoice
therefor) pay all fees, expenses and costs relating to this Amendment Agreement, including, but not limited to, the reasonable 

  

 3 








 
fees of your special counsel, Bingham McCutchen LLP, incurred in connection with the preparation, negotiation and delivery of this Amendment Agreement and
any other documents related thereto. Notwithstanding the foregoing, the Company will on the Effective Date, pay the fees and expense of Bingham McCutchen LLP incurred through the Effective Date. Nothing in this Section shall limit the Company’s
obligations pursuant to Section 1.5 of the Existing Note Agreement. 
  

	 	6.2	Amendment Fee. 

  
 The Company shall have paid to each of the Current Noteholders an amendment fee in connection with the execution and delivery of this Amendment Agreement,
in an amount equal to the product of (i) the aggregate outstanding principal amount of the Existing Notes held by such Current Noteholder on the Effective Date multiplied by (ii) 0.07% (7 basis points) (the “Amendment
Fee”). The Amendment Fee shall have been paid in immediately available funds to the account or accounts of such Current Noteholder as specified below such Current Noteholders’ name in Schedule A attached hereto. 
  

	7.	MISCELLANEOUS. 

  
 7.1. Part of Existing Note Agreement; Future References, etc. 
  
 This Amendment Agreement shall be construed in connection with and as a part of the Existing Note Agreement and, except as
expressly amended by this Amendment Agreement, all terms, conditions and covenants contained in the Existing Note Agreement are hereby ratified and shall be and remain in full force and effect. Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of this Amendment Agreement may refer to the Existing Note Agreement without making specific reference to this Amendment Agreement, but nevertheless all such references shall
include this Amendment Agreement unless the context otherwise requires. 
  

	 	7.2.	Counterparts; Effectiveness. 

  
 This Amendment Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. Delivery of an executed signature page by facsimile transmission or e-mail transmission of an
adobe file format document (also known as a PDF file) shall be effective as delivery of a manually signed counterpart of this Amendment Agreement. 
  

	 	7.3.	Governing Law. 

  
 THIS AMENDMENT AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE
OF CONNECTICUT EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD 

  

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REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN CONNECTICUT. 
  
 [Remainder of page intentionally left blank; next page is signature page.] 
  

 5 








 If you are in agreement with the foregoing, please so indicate by signing the acceptance below on the
accompanying counterpart of this Amendment Agreement and returning it to the Company, whereupon it will become a binding agreement among each of you and the Company. 
  

			
	BARNES GROUP INC.
		
	 By:
	 	/s/    LAWRENCE W.
O’BRIEN        
	 Name:
	 	Lawrence W. O’Brien
	 Title:
	 	Vice President and Treasurer
		
	 By:
	 	/s/    WILLIAM C.
DENNINGER        
	 Name:
	 	William C. Denninger
	 Title:
	 	Senior Vice President and Chief Financial Officer


  
 [Signature Page
to Amendment No. 3] 









 The foregoing Amendment Agreement is hereby accepted as of the date first above written. 
  

			
	THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
		
	 By:
	 	/s/    PAUL MEIRING        
	 Name:
	 	Paul Meiring
	 Title:
	 	Vice President
	
	ALLSTATE LIFE INSURANCE COMPANY
		
	 By:
	 	/s/    ROBERT B. BODETT        
	 Name:
	 	Robert B. Bodett
	 Title:
	 	 Authorized Signatory

		
	 By:
	 	/s/    JERRY D. ZINKULA        
	 Name:
	 	Jerry D. Zinkula
	 Title:
	 	 Authorized Signatory

		
	 	 	 Authorized Signatories

	
	AMERICAN HERITAGE LIFE INSURANCE COMPANY
		
	 By:
	 	/s/    ROBERT B. BODETT        
	 Name:
	 	Robert B. Bodett
	 Title:
	 	 Authorized Signatory

		
	 By:
	 	/s/    JERRY D. ZINKULA        
	 Name:
	 	Jerry D. Zinkula
	 Title:
	 	 Authorized Signatory













			
	NATIONWIDE LIFE INSURANCE COMPANY
		
	By:	 	/s/    WAYNE T. FRISBEE        
	 Name:
	 	Wayne T. Frisbee
	 Title:
	 	Vice President-Portfolio Management
	
	NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY
		
	By:	 	/s/    WAYNE T. FRISBEE        
	 Name:
	 	Wayne T. Frisbee
	 Title:
	 	Vice President-Portfolio Management
	
	NATIONWIDE INDEMNITY COMPANY
		
	By:	 	/s/    WAYNE T. FRISBEE        
	 Name:
	 	Wayne T. Frisbee
	 Title:
	 	Vice President-Portfolio Management











  
 Annex 1 
  
 CURRENT NOTEHOLDERS AND 
 CURRENT OUTSTANDING PRINCIPAL AMOUNT 
  

				
	 Current Noteholders

	  	 Outstanding Principal
 Amount of Notes


	 The Prudential Insurance Company of America
	  	$	35,000,000
	 Allstate Life Insurance Company
	  	$	10,000,000
	 American Heritage Life Insurance Company
	  	$	5,000,000
	 Nationwide Life Insurance Company
	  	$	4,000,000
	 Nationwide Life and Annuity Insurance Company
	  	$	2,000,000
	 Nationwide Indemnity Company
	  	$	4,000,000
	 TOTAL
	  	$	60,000,000

  

 Annex 1 








  
 Exhibit A 

 
 AMENDMENT 
  
 1. Section 7.4 (Sale of Assets or Merger) of the Existing Note Agreement is
hereby amended by adding a new subsection (c) at the end of such Section to read as follows: 
  
 “(c) Acquisitions — The Company may purchase or otherwise acquire all or substantially all of the assets or stock or other equity
interests of any other Person provided, that: 
  
 (i) the Company is in current compliance with and, after giving effect to the proposed acquisition (including any borrowings made or to be made in connection therewith), will continue to be in compliance with all of the covenants in
Section 7 hereof as if the transaction occurred on the first day of the period of measurement; provided, the holders of Notes shall have received a certificate of the Chief Financial Officer or a Vice President and the Treasurer or an
Assistant Treasurer certifying compliance with the requirements of Section 7 on a pro forma historical basis as if the transaction occurred on the first day of the period of measurement and the related documentation showing the estimated
calculations (subject to any adjustments) made in determination thereof; 
  
 (ii) at the time of such acquisition, no Default or Event of Default has occurred and is continuing, and such acquisition will not otherwise create a Default or an Event of Default hereunder; 
  
 (iii) the business to be acquired is similar to the business
conducted by the Company or businesses reasonably related or incidental thereto; 
  
 (iv) not later than seven (7) days prior to the proposed acquisition date, notice of any proposed acquisition with an aggregate
consideration (including assumption of indebtedness) of more than $30,000,000, together with all information reasonably requested by the holders of Notes with respect to such acquisition (including, without limitation, historical financial
statements and due diligence summaries) shall have been furnished to the holders. 
  
 (v) the board of directors and (if required by applicable law) the shareholders, or the equivalent thereof, of the business to be acquired
has approved such acquisition; 
  
 (vi) if such
acquisition is made by a merger, the Company (or a wholly-owned Subsidiary of the Company) shall have complied with the provisions of Section 7.4(b); and 
  

(vii) the total consideration to be paid in connection with any acquisition or series of related acquisitions, in the form of cash and
assumption of debt with respect to any such acquisition or series of related acquisitions, shall not exceed $200,000,000 without the consent of the holders of 66-2/3% of the aggregate outstanding principal amount of the Notes.” 
  

 Exhibit A-1 








 2. Section 7.6(a)(viii) (Negative Pledge) of the Existing Note Agreement is hereby amended and restated in
its entirety to read as follows: 
  
 “(viii)
other liens, that in the aggregate, when combined with all Indebtedness of Subsidiaries permitted to exist by Section 7.7(b) would not, at any time, exceed 15% of Consolidated Assets determined as of the end of the then most recently completed
fiscal year of the Company.” 
  
 3. Section 7.7 (Indebtedness) of
the Existing Note Agreement is hereby amended and restated in its entirety to read as follows: 
  
 “Section 7.7 Indebtedness. 
  
 (a) The Company will not, nor will it permit any of its Subsidiaries to, directly or indirectly incur, create, assume or permit to exist any Indebtedness other than (i) Indebtedness incurred by the Company and
Barnes Switzerland under the Revolving Credit Agreement so long as such Indebtedness of Barnes Switzerland is subject to the Sharing Agreement; (ii) Indebtedness outstanding on the date of Amendment No. 3 under (1) the Notes or
(2) the Nova Scotia Notes and Indebtedness which constitutes extensions, renewals or replacements of such Indebtedness so long as such Indebtedness is on substantially the same terms and conditions and does not increase the amount of
outstanding of (1) and (2); total Indebtedness of the Company’s Domestic Subsidiaries not to exceed at any time $10,000,000; (iii) Indebtedness of the Company’s Foreign Subsidiaries not to exceed in the aggregate at any time for
all such Foreign Subsidiaries, 10% of Consolidated Assets and $50,000,000 in the aggregate for any Foreign Subsidiary, provided, however that the Indebtedness of Foreign Subsidiaries all of whose lenders are party to the Sharing Agreement shall be
excluded from this calculation and (iv) additional Indebtedness of the Company and its Subsidiaries provided that the aggregate amount of all such Indebtedness at any time outstanding shall not exceed an amount equal to 135% of Consolidated Net
Worth at such time; and 
  
 (b) (i)
Notwithstanding the foregoing, the Company will not permit any of its Subsidiaries to, directly or indirectly incur, create, assume or permit to exist any Indebtedness unless (1) all Indebtedness, plus the aggregate liquidation preference or
redemption value of all Preferred Stock, of Subsidiaries (other than Indebtedness owing to, or Preferred Stock held by, the Company or other Subsidiaries) plus (2) all Indebtedness of the Company secured by Liens permitted to exist by
Section 7.6(a)(vii), shall not at any time exceed 15% of Consolidated Assets determined as of the end of the most recently completed fiscal year of the Company. 
  
 4. Section 7.10 (Consolidated Leverage Ratio) of the Existing Note Agreement is hereby amended and restated in its entirety to
read as follows: 
  
 “7.10. Consolidated Leverage Ratio.
The Company will not permit the Consolidated Leverage Ratio to exceed 1.35 to 1 at any time.” 
  

 Exhibit A-2 








 5. Section 7.16 (Restricted Payments and Restricted Investments) of the Existing Note Agreement is hereby
amended and restated in its entirety to read as follows: 
  
 “Section 7.16 Restricted Investments. The Company will not, nor will it permit any Subsidiary to, at any time make or permit to exist any loans or advances to, or purchase any stock, other securities or evidences of indebtedness
of, or make or permit to exist any investment or acquire any interest whatsoever in, any other Person, except 
  
 (a) investments of its cash by the Company or any Subsidiary in (i) marketable direct obligations of, or marketable obligations
guaranteed by, the United States of America or Canada, or marketable obligations of any instrumentality or agency thereof, the payment of the principal and interest of which is unconditionally guaranteed by the United States of America or Canada,
(ii) certificates of deposit or other obligations issued by, or bankers’ acceptances of, any bank or trust company organized under the laws of Brazil, Singapore, the Federal Republic of Germany, France, the United Kingdom, Japan, Canada or
the United States of America or any state thereof (including foreign branches of any such bank or trust company) and having capital, surplus and undivided profits in excess of $100,000,000, (iii) open market commercial paper with a maturity not
in excess of 270 days from date of acquisition thereof and having at the time of purchase been rated and the ratings for which are not less than “P 2” if rated by Moody’s Investors Service, Inc. and not less than “A 2” if
rated by Standard & Poor’s Corporation, or (iv) in the case of any foreign Subsidiary of the Company in a country in which a Subsidiary exists as of the date of Amendment No. 3, such investments of a comparable quality and
term to the other investments permitted by this clause (a) as are usually made in the jurisdiction or jurisdictions in which the business of such Foreign Subsidiary is principally conducted by prudent corporate investors in like circumstances;

  
 (b) Investments (including debt obligations
and capital stock) received in connection with the bankruptcy or reorganization of suppliers and customers in settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business;

  
 (c) Investments existing on the date of
Amendment No. 3 in Subsidiaries’ and other Investments as set forth on Schedule 7.16 attached hereto; 
  
 (d) Investments by the Company in Subsidiaries, including such Investments existing on the date of Amendment No. 3, not to exceed in
the aggregate 15% of Consolidated Assets; provided that the above limitation shall not apply with respect to (x) Investments made in order to effect transactions permitted under Section 7.4 or (y) Investments in Barnes
Switzerland so long as the lenders of Barnes Switzerland are party to the Sharing Agreement; and provided further that notwithstanding any provision set forth in this Section 7.16 to the contrary, (I) Investments in the Barnes Group
Gibraltar Limited shall be limited to $100,000, and (II) Investments in Barnes Group Luxembourg (No. 1) S.A. and Barnes Group Luxembourg (No. 2) S.A., other than amounts being held for application to the account of the Company, shall be limited to
$100,000; 
  

 Exhibit A-3 








 (e) Investments consisting of permitted acquisitions under Section 7.4(c);

  
 (f) (i) Investments by any Subsidiaries
of the Company in the Company, provided that any Investment by such Subsidiary must be an equity Investment or expressly subordinated to the prior payment in full in cash of all obligations under the Note Agreement and the Notes on terms
disclosed to and reasonably acceptable to the holders of Notes prior to the incurrence thereof; and (ii) Investments by Subsidiaries of the Company in other Subsidiaries of the Company; 
  
 (g) Investments consisting of loans and advances to
employees for moving, entertainment, travel and other similar expenses in the ordinary course of business not to exceed at any time, an aggregate of $2,000,000 and 
  
 (h) Investments in joint ventures; provided that the operation to be invested in is in a similar or
related business and provided further that after giving effect to such joint venture, the Company shall be in compliance, on a pro forma basis, with all financial covenants.” 
  
 6. The definition of “Kar Guaranty” appearing in Section 10.1 (Terms Defined) of the Existing Note Agreement is
hereby deleted in its entirety. 
  
 7. The definitions of “Nova Scotia
Notes” and “Revolving Credit Agreement” appearing in Section 10.1 (Terms Defined) of the Existing Note Agreement are hereby amended and restated in their entirety to read as follows: 
  
 “Nova Scotia Notes” - means the amended and restated 7.66%
Senior Notes due November 12, 2007 and the amended and restated 7.80% Senior Notes due November 12, 2010 issued by the Company, and any extensions or renewals thereof, provided that the principal amount of Indebtedness evidenced thereby is
not increased. 
  
 “Revolving Credit Agreement” -
means the Second Amended and Restated $175,000,000 Senior Unsecured Revolving Credit Agreement, dated as of January 11, 2006, by and among the Company, Barnes Switzerland, Bank of America, N.A., as administrative agent, the lenders listed on
Schedule 1 thereto, Bank of America Securities LLC, as arranger, Keybank National Association, as syndication agent and HSBC Bank USA and Webster Bank, National Association, as co-documentation agents. 
  
 8. The following definitions are hereby added to Section 10.1 (Terms Defined) of
the Existing Note Agreement in the appropriate alphabetical order thereof to read as follows: 
  
 “Amendment No. 3” - means that certain Amendment No. 3 to Note Agreement, dated January 11, 2006 by and among the Company and each of the holders of Notes a party thereto. 

 

 Exhibit A-4 








 “Barnes Switzerland” - means Barnes Group Switzerland GmbH, a corporation organized
under the laws of Switzerland and an indirect, wholly-owned Subsidiary of the Company. 
  
 “Sharing Agreement” - means that certain Sharing Agreement, dated as of January 11, 2006, by and among the banks listed on the signature pages thereto, Bank of America, N.A., as agent, the
Current Noteholders and holders of the notes issued under those separate Note Agreements, each dated as of November 21, 2000, (as amended by Amendment No. 1 to Note Agreement, dated as of February 21, 2002 and Amendment No. 2,
dated as of February 5, 2003) and entered into by and among the Company and each of the Purchasers listed in Exhibit A attached thereto, as it may from time to time, be amended or supplemented.” 
  
 9. Schedule 7.16 is hereby added in its entirety to the Existing Note Agreement to read as
set forth on Exhibit B attached hereto. 
  

 Exhibit A-5 








  
 Exhibit B 

 
 Schedule 7.16 
  
 None. 

 Exhibit B