exv10wii






Exhibit 10(ii)




EXECUTION COPY




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.




     (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.




     “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.



 









 






     “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;




          (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.




          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 	 
	 
	 
	 	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 	 
	 
	 
	 	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/ Jordan Fragiacomo
 	 
	 	 	Name:  	Jordan 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 Burgueño
 	 
	 	 	Name:  	Manuel Burgueño 	 
	 	 	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 J. Hallan
 	 
	 	 	Name:  	Peter J. Hallan 	 
	 	 	Title:  	Vice President 	 



 









 






	 	 	 	 	 



Exhibit A




SUBSIDIARY GUARANTY



          SUBSIDIARY GUARANTY dated as of March                     , 2010 made by The Black & Decker Corporation, a
Maryland corporation (the “Guarantor”), in favor of the Administrative Agent and the
Lenders (as defined in the Credit Agreement referred to below).




          PRELIMINARY STATEMENT. Stanley Black & Decker, Inc. (formerly known as The Stanley Works), a
Connecticut corporation (the “Company”), and the parent company of the Guarantor, is party
to 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, and as may be further
amended, supplemented or otherwise modified form time to time, the “Credit Agreement”;
capitalized terms used herein have the meanings assigned to such terms in the Credit Agreement).
The Guarantor may receive, directly or indirectly, a portion of the proceeds of the Advances under
the Credit Agreement and will derive substantial direct and indirect benefits from the transactions
contemplated by the Credit Agreement. It is a condition precedent to the effectiveness of
Amendment No. 2 to the Credit Agreement dated as of the date hereof (the “Amendment”) and
the continued making of Advances by the Lenders under the Credit Agreement from time to time that
the Guarantor shall have executed and delivered this Guaranty.




          NOW, THEREFORE, in consideration of the premises and in order to induce the Lenders to enter
into the Amendment and to make Advances under the Credit Agreement from time to time, the Guarantor
hereby agrees as follows:




          SECTION
8. Guaranty; Limitation of Liability . i) To induce the other parties to enter into
the Amendment and for other valuable consideration, receipt of which is hereby acknowledged, the
Guarantor 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 the Credit Agreement and each
other Loan Document, in each case strictly in accordance with the terms thereof (collectively, the
“Guaranteed Obligations”). The 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, the 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 1 is a continuing guaranty and is a guaranty of payment and is not merely a
guaranty of collection and shall apply to all Guaranteed Obligations whenever arising.




          (a) The Guarantor, and by its acceptance of this Guaranty, the Administrative Agent and each
Lender, hereby confirms that it is the intention of all such Persons that this





 









 







Guaranty and the obligations of the 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 guaranty and the obligations of the Guarantor hereunder. To effectuate the
foregoing intention, the Administrative Agent, the Lenders and the Guarantor hereby irrevocably
agree that the obligations of the Guarantor under this Guaranty at any time shall be limited to the
maximum amount as will result in the obligations of the Guarantor under this Guaranty not
constituting a fraudulent transfer or conveyance.




          SECTION
9. Acknowledgments, Waivers and Consents. The Guarantor agrees that its obligations
under this Guaranty shall be primary, absolute, irrevocable and unconditional under any and all
circumstances and that the guaranty herein is made with respect to any Guaranteed Obligations now
existing or in the future arising. Without limiting the foregoing, the Guarantor agrees that:






     (a) The occurrence of any one or more of the following shall not affect the
enforceability or effectiveness of this Guaranty in accordance with its terms or affect,
limit, reduce, discharge or terminate the liability of the Guarantor, or the rights,
remedies, powers and privileges of the Administrative Agent or any Lender, under this
Guaranty:




     (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;




     (ii) any release, termination, waiver, abandonment, lapse or expiration, subordination
or enforcement of the liability of any other guaranty of all or any part of the Guaranteed
Obligations;




     (iii) any application of the proceeds of any other guaranty (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 guaranty 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 Guaranty;




     (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 2(a).




     (b) The enforceability and effectiveness of this Guaranty and the liability of the
Guarantor, and the rights, remedies, powers and privileges of the Administrative Agent and
the Lenders, under this Guaranty shall not be affected, limited, reduced, discharged or
terminated, and the Guarantor hereby expressly waives to the fullest extent permitted by law
any defense now or in the future arising, by reason of:




     (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
guaranty (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 3, 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
the Guarantor may have with respect to all or any part of any obligations owed to the
Guarantor by the Administrative Agent or any Lender (other than, without prejudice to
Section 3, any counterclaim or other claim that the amount of the 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;




     (ix) any action taken by the Administrative Agent or any Lender that is authorized
under this Guaranty 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, the 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 guaranty of, or security for, any of the Guaranteed Obligations, and all
notices of acceptance of this Guaranty or of the existence, creation, incurring or
assumption of new or additional Guaranteed Obligations.



          SECTION
10. Reinstatement. The obligations of the Guarantor under this Guaranty 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
11. Subrogation. The 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 guaranty in Section 1, 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 12. Remedies. The Guarantor agrees that, as between the Guarantor and the Administrative
Agent and the Lenders, the obligations of any other Loan Party under the Credit Agreement or any
other Loan Documents may be declared to be forthwith due and payable as provided in Section 6.01 of
the Credit Agreement (and shall be deemed to have become automatically due and payable in the
circumstances provided in said Section 6.01) for purposes of Section 1, 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 the Guarantor for purposes of Section 1.




          SECTION
13. Payments. Each payment by the Guarantor under this Guaranty shall be made in
accordance with Section 2.09 of the Credit Agreement in the Currency in which the Guaranteed
Obligations 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.




          SECTION 14. Representations and Warranties of the Guarantor. The Guarantor represents and
warrants as follows:




          (a) Corporate Existence. The 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 the
Guarantor of this Guaranty are within the Guarantor’s corporate powers, have been duly authorized
by all necessary corporate action and do not contravene (i) the charter or bylaws of the Guarantor
or (ii) any law or contractual restriction binding on or affecting the Guarantor 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 the Guarantor of this Guaranty.




          (d) Enforceability. This Guaranty is the legal, valid and binding obligations of the
Guarantor, enforceable against the Guarantor in accordance with its terms.






 









 








          (e) No Litigation. There is no pending or (to the best of the Guarantor’s knowledge)
threatened action or proceeding against the Guarantor or any of its Subsidiaries or relating to any
of their respective properties before any court, governmental agency or arbitrator, which purports
to affect the legality, validity or enforceability of this Guaranty.




          (f) Investment Company. The Guarantor is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.




          (g) Disclosure. The information furnished in writing by or on behalf of the Guarantor
to the Lenders in connection with the negotiation, execution and delivery of this Guaranty 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.




          (h) No Defaults. The Guarantor 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.




          SECTION
15. Notices, Etc. All notices, demands, requests, consents and other communications
provided for in this Guaranty 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 set forth in Section 8.02 of the Credit Agreement. Delivery by telecopier of an executed
counterpart of a signature page to any amendment or waiver of any provision of this Guaranty shall
be effective as delivery of an original executed counterpart thereof.




          SECTION
16. 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 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. No amendment or waiver of any provision of this
Guaranty, nor 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 Guarantor 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 all the Lenders shall be required for
any release or modification of the Guarantor’s guarantee under Section 1.




          SECTION
17. Right of Set-off. 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 the Guarantor against any of and all the obligations of the Guarantor now or hereafter
existing under this Guaranty, 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..



 









 







          SECTION
18. Continuing Guaranty; Assignments under the Credit Agreement. This Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until the later of (i) the
payment in full in cash of the Guaranteed Obligations and all other amounts payable under this
Guaranty and (ii) the Termination Date, (b) be binding upon the Guarantor, its successors and
assigns and (c) inure to the benefit of and be enforceable by the Administrative Agent and the
Lenders and their successors, transferees and assigns. Without limiting the generality of
clause (c) of the immediately preceding sentence, any Lender may assign or otherwise transfer all
or any portion of its rights and obligations under the Credit Agreement (including, without
limitation, all or any portion of its Commitments, the Advances owing to it and the Note or Notes
held by it) to any other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Lender herein or otherwise, in each case as and to the
extent provided in Section 8.07 of the Credit Agreement. The Guarantor shall not have the right to
assign its rights or obligations hereunder or any interest herein without the prior written consent
of the Lenders.




          SECTION
19. Execution in Counterparts. This Guaranty 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 Guaranty by telecopier shall be effective as delivery of a manually
executed counterpart of this Guaranty.




          SECTION
20. Jurisdiction; Governing Law; Waiver of Jury Trial, Etc. ii) Submission to
Jurisdiction. The Guarantor 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 Guaranty.




          (a) Waiver of Venue. The Guarantor 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.




          (b) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK. THE GUARANTOR HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED
HEREBY.




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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.




	 	 	 	 	 
	 	THE BLACK & DECKER CORPORATION

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title: