Document:

Exhibit

Exhibit 10.4
EXECUTIVE CHANGE IN CONTROL AGREEMENT
This Executive Change In Control Agreement made as of the 31st day of March, 2016, by and between Teleflex Incorporated (the “Company”) and Karen Boylan (“Employee”).
WHEREAS, Employee is employed as an executive of Teleflex Medical Europe Ltd., a wholly-owned subsidiary of the Company; and
WHEREAS, the Board of Directors of the Company believes that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of Employee without distraction, notwithstanding that the Company could be subject to a Change of Control, and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of key management personnel to the detriment of the Company; and
WHEREAS, in consideration for Employee agreeing to continue in employment with the Company and agreeing to keep Company information confidential, the Company agrees that Employee shall receive the compensation set forth in this Agreement in the event Employee’s employment is terminated without Cause, upon or after a Change of Control;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, the parties hereto agree as follows:
1.Definitions.
“Base Salary” shall mean the base rate of salary being paid to Employee in all capacities with the Company, together with any and all salary reduction authorized amounts under any of the Company’s benefit plans or programs, at the time of the delivery of a Notice of Termination to Employee. 
     “Base Salary Continuation Period” shall mean the 18 month period commencing on the day after the date on which Notice of Termination is given.
  
“Benefit Period” shall mean the period beginning on the date on which Notice of Termination is issued and ending on the first to occur of (a) the 18-month anniversary of the date on which Notice of Termination issued or (b) the first date on which Employee is employed by another employer and is eligible to participate in a health plan of Employee’s new employer.
“Board” shall mean the board of directors of the Company.

TFX CoC Severance 1002.4  

“Bonus Plan” shall mean a plan of the Company providing for the payment of a cash bonus to Employee.
“Cause” shall mean (a) misappropriation of funds, (b) conviction of a crime involving moral turpitude, or (c) gross negligence in the performance of duties, which gross negligence has had a material adverse effect on the business, operations, assets, properties or financial condition of the Company and its subsidiaries taken as a whole.
“Change of Control” shall mean one of the following shall have taken place after the date of this Agreement: 
(a)    any “person” (as such term is used in Sections 13(d) or 14(d) of the Exchange Act) (other than the Company, any majority controlled subsidiary of the Company, or the fiduciaries of any Company benefit plans) becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of 20% or more of the total voting power of the voting securities of the Company then outstanding and entitled to vote generally in the election of directors of the Company; provided, however, that no Change of Control shall occur upon the acquisition of securities directly from the Company;
(b)    individuals who, as of the beginning of any 24 month period, constitute the Board (as of the date hereof the “Incumbent Board”) cease for any reason during such 24 month period to constitute at least a majority of the Board, provided that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the directors of the Company;
(c)    consummation of (i) a merger, consolidation or reorganization of the Company, in each case, with respect to which all or substantially all of the individuals and entities who were the respective beneficial owners of the voting securities of the Company immediately prior to such merger, consolidation or reorganization do not, following such merger, consolidation or reorganization, beneficially own, directly or indirectly, at least 65% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity or entities resulting from such merger, consolidation or reorganization, (ii) a complete liquidation or dissolution of the Company or (iii) a sale or other disposition of all or substantially all of the assets of the Company, unless at least 65% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity or entities that acquire such assets are beneficially owned by individuals or entities who or that were beneficial owners of the voting securities of the Company immediately before such sale or other disposition; or 

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(d)    consummation of any other transaction determined by resolution of the Board to constitute a Change of Control.
     “Contract of Employment” shall mean the contract of employment entered into between the Company and Employee with an issued date of 27 September 2011, as may be amended from time to time.
“Component Target Amount” shall have the meaning specified therefor in the definition of “Target Bonus” in this Section 1.
“Disability” shall mean Employee’s continuous illness, injury or incapacity for a period of six consecutive months.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
“Good Reason” means a Termination of Employment initiated by Employee by Notice of Termination, upon one or more of the following occurrences; provided that as soon as practicable after Employee becomes aware of such occurrence and before such Notice of Termination is given, Employee shall have given written notice of Good Reason to the Company and the Company shall not have fully corrected the situation within 10 days after notice of such Good Reason:
		
	(a)
	any failure of the Company to comply with and satisfy any of the material terms of this Agreement;

		
	(b)
	any significant reduction by the Company of the title, duties, job responsibilities, reporting relationship or position of Employee;

		
	(c)
	any reduction in Employee’s Base Salary; or 

		
	(d)
	the moving of the principal office of the Company to which Employee is assigned to a location more than 25 miles from its location on the date of the Change of Control.

“Performance Period” applicable to any Target Amount under a Bonus Plan shall mean the period of time in which the performance goals applicable to the determination of cash bonus awards pursuant to such Bonus Plan are measured.
“Target Amount” in respect of a bonus payable to Employee pursuant to any Bonus Plan shall mean the amount specified in the Company’s records pertaining to such Bonus Plan as the “target amount” of cash bonus which would be payable to Employee if specified conditions were fulfilled.
“Target Bonus” shall mean the sum of the Target Amounts (each a “Component Target Amount”) which would be payable in the year immediately following the Termination Year pursuant to all Bonus Plans if all of the conditions for the payment 

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of each Component Target Amount were fulfilled, without regard to whether such conditions are actually fulfilled; provided that, if a Target Amount has not been determined for any such Bonus Plan on or before the Termination Date, the Target Amount for such Bonus Plan which would have been payable in the Termination Year shall be substituted for such undetermined Target Amount in the foregoing calculation of the “Target Bonus.”
“Termination Date” shall mean the date specified in a Notice of Termination issued by the Company as the effective date on which Employee’s Termination of Employment occurs.
“Termination of Employment” shall be determined to have occurred on the Termination Date specified in the Notice of Termination delivered to Employee as specified in Section 2 of this Agreement.
“Termination following a Change of Control” shall mean a Termination of Employment upon or within two years after a Change of Control either: 
		
	(a)
	initiated by the Company for any reason other than Disability or Cause; or

		
	(b)
	initiated by Employee for Good Reason.

“Termination Year” shall mean the year in which Employee’s Termination Date occurs.
2.    Notice of Termination.  Any Termination of Employment shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 13 hereof.  For purposes of this Agreement, a “Notice of Termination” means a written notice which (a) states that Employee’s employment is being terminated, (b) specifies the Termination Date, (c) solely in the case of termination for “Cause,” states that the termination is for Cause, and (d) solely in the case of termination by Employee for Good Reason, states that the termination is for Good Reason.  
3.    Compensation upon Termination following a Change of Control.  Subject to the provisions of subsection (d) below and Sections 4 and 5 hereof, in the event of Employee’s Termination following a Change of Control, Employee shall be entitled to receive the following payments and benefits from the Company:
(a)    Employee shall receive payment of Employee’s unpaid base salary earned through the date on which Notice of Termination is given, payable in accordance with the Company’s normal payroll schedule and payroll practices in effect as of the date on which Notice of Termination is given, subject to all applicable withholdings and deductions.

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(b)    If a bonus awarded to Employee pursuant to any Bonus Plan for payment in the year in which Notice of Termination is given shall not have been paid to Employee, Employee shall receive the amount of such award within 15 days after the date on which Notice of Termination is given.  If no such bonus shall have been awarded to Employee under any Bonus Plan, Employee shall receive the following within 15 days after the date on which Notice of Termination is given: a lump sum cash payment in the amount of the sum of the Target Amounts under each such Bonus Plan referred to in the immediately preceding sentence which would have been payable to Employee in the year in which Notice of Termination is given. 
(c)    Within 15 days after the date on which Notice of Termination is given, Employee shall receive a lump sum cash payment equal to the pro-rated amount of the Target Bonus (the “Pro-Rated Target Bonus”). The Pro-Rated Target Bonus shall be computed by multiplying the Target Bonus by a fraction (i) the numerator of which is the number of days in each year of the Performance Period applicable to such Component Target Amount reduced by the number of days in the year following the date on which Notice of Termination is given and (ii) the denominator of which is the number of days in the Performance Period.
(d)    Beginning with the date on which Notice of Termination is given, Employee shall receive the following:
(i)    The Company will continue to pay Employee’s Base Salary for the duration of the applicable Base Salary Continuation Period (the “Base Salary Severance Amount”), in accordance with the Company’s normal payroll schedule and payroll practices in effect from time to time, subject to all applicable withholdings and deductions, provided, however, that any payment of base salary made to Employee in respect of any notice period which he or the Company is required to give under the terms of his Contract of Employment (irrespective of whether Employee works, is placed on garden leave, or payment is made in lieu of, all or a part of such notice period) shall be offset against the Base Salary Severance Amount, and provided that in the event that Employee is made redundant by the Company, then any statutory redundancy payment to which Employee is entitled shall be offset against the Base Salary Severance Amount calculated as of the Termination Date, and Employee shall not be entitled to double recovery in respect of (i) any statutory redundancy payment or (ii) any payment of base salary payable to Employee in respect of any notice period which he or the Company is required to give under the terms of his Contract of Employment. 
(ii)    Employee shall receive a payment equal to (A) one hundred percent (100%) of the Target Bonus on the twelve (12) month anniversary of the date on which Notice of Termination is given; and (B) fifty percent (50%) of the Target Bonus on the twenty-four (24) month anniversary of 

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the date on which Notice of Termination is given.  The amount paid on each such date shall be paid in the form of a single lump sum cash payment less any applicable deductions.
(iii)    Subject to statutory deductions, during the Benefit Period, the Company shall continue to provide health and dental benefits under the Company’s then-current health and dental plans for Employee and Employee’s spouse and eligible dependents on the same basis as if Employee had continued to be employed during that period.    Notwithstanding the   preceding, if Employee and Employee’s spouse and eligible dependents are not eligible to continue coverage under the Company’s health and/or dental plan(s), subject to statutory deductions, the Company will reimburse Employee in cash on the last day of each month during the Benefit Period (or balance thereof) an amount based on the cost actually paid by Employee for that month to maintain health and/or dental insurance coverage from commercial sources that is comparable to the health and/or dental coverage Employee last elected as an employee for Employee and Employee’s spouse and eligible dependents under the Company’s health and/or dental plan(s) covering Employee, where the net monthly reimbursement after taxes are withheld will equal the Company’s portion of the cost paid by Employee for that month’s coverage determined in accordance with the Company’s policy then in effect for employee cost sharing, on substantially the same terms as would be applicable to an executive officer of the Company.
(iv)    The Company shall reimburse Employee for the cost of outplacement assistance services incurred by Employee up to a maximum of $20,000, which shall be provided by an outplacement agency selected by Employee.  The Company shall reimburse Employee within 15 days following the date on which the Company receives proof of payment of such expense, which proof must be submitted no later than December 1st of the calendar year after the calendar year in which the expense was incurred.  Notwithstanding the foregoing, Employee shall only be entitled to reimbursement for those outplacement service costs incurred by Employee on or prior to the last day of the second year following the Termination Year.
(e)    All Company stock options and restricted stock held by Employee as of Employee’s Termination Date that have not previously become vested and exercisable shall immediately become fully vested and exercisable as of the date immediately preceding the Termination Date, and any stock option or restricted stock awards under which such stock options or restricted stock are granted are hereby amended, effective the later of the date of this Agreement or the date of such award, to so provide.

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(f)    As a condition to the obligation of the Company to pay compensation and provide benefits under this Agreement, the Company shall have received from Employee immediately following the Termination Date a written waiver and release of claims against the Company substantially in the form attached hereto as Exhibit A (but subject to any necessary adjustments reasonably determined by the Company to be necessary to comply with applicable laws and regulations in effect as of Employee’s Termination Date) executed by Employee (the “Release”).  If Employee fails to execute the Release, no payments or benefits shall thereafter be made or provided to Employee pursuant to this Agreement.

4.    Confidential Information.  Employee recognizes and acknowledges that, by reason of Employee’s employment by and service to the Company, Employee has had and will continue to have access to confidential information of the Company and its affiliates, including, without limitation, information and knowledge pertaining to products and services offered, innovations, designs, ideas, technology, manufacturing and assembly methods, procedures, work instructions, plans, trade secrets, proprietary information, distribution and sales methods and systems, sales and profit figures, customer and client lists, and relationships between the Company and its affiliates and other distributors, customers, clients, suppliers and others who have business dealings with the Company and its affiliates (“Confidential Information”).  Employee acknowledges that such Confidential Information is a valuable and unique asset of the Company, and Employee covenants that Employee will not, either during or after Employee’s employment by the Company, disclose any such Confidential Information to any person for any reason whatsoever without the prior written authorization of the Company, unless such information is in the public domain through no fault of Employee or except as may be required by law or in a judicial or administrative proceeding.  Notwithstanding anything to the contrary herein, each of the parties hereto (and each employee, representative, or other agent of such parties) may disclose to any person, without limitation of any kind, the federal income tax treatment and federal income tax structure of the transactions contemplated hereby and all materials (including opinions or other tax analyses) that are provided to such party relating to such tax treatment and tax structure.
5.    Equitable Relief.
(a)    Employee acknowledges that the restrictions contained in Section 4 hereof are reasonable and necessary to protect the legitimate interests of the Company and its affiliates, that the Company would not have entered into this Agreement in the absence of such restrictions, and that any violation of any provision of that Section will result in irreparable injury to the Company.  Employee represents and acknowledges that (i) Employee has been advised by the Company to consult Employee’s own legal counsel in respect of this Agreement, and (ii) Employee has had full opportunity, prior to 

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execution of this Agreement, to review thoroughly this Agreement with Employee’s counsel.
(b)    Employee agrees that the Company shall be entitled to preliminary and permanent injunctive relief, without the necessity of proving actual damages, as well as an equitable accounting of all earnings, profits and other benefits arising from any violation of Section 4 hereof, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled.  Without limiting the foregoing, Employee also agrees that payment of the compensation and benefits payable under Section 3 of this Agreement may be automatically ceased in the event of a material breach of the covenants of Section 4, provided the Company gives Employee written notice of such breach, detailing the activity of Employee that constitutes a material breach, and Employee fails to cease such activity within 15 days after Employee’s receipt of such written notice.  In the event that any of the provisions of Section 4 hereof should ever be adjudicated to exceed the time, geographic, service, or other limitations permitted by applicable law in any jurisdiction, then such provisions shall be deemed reformed in such jurisdiction to the maximum time, geographic, service, or other limitations permitted by applicable law.
(c)    Employee irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of Section 4 hereof, including without limitation, any action commenced by the Company for preliminary and permanent injunctive relief or other equitable relief, may be brought in the United States District Court for the Eastern District of Pennsylvania, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in or around Philadelphia, Pennsylvania, (ii) consents to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) waives any objection which Employee may have to the laying of venue of any such suit, action or proceeding in any such court.  Employee also irrevocably and unconditionally consents to the service of any process, pleadings, notices or other papers in a manner permitted by the notice provisions of Section 13 hereof.
6.    Other Payments and Indemnification.  The payments due under Section 3 hereof shall be in addition to and not in lieu of any payments or benefits due to Employee under any other plan, policy or program of the Company except as provided under Section 15(a) and except that no cash payments shall be paid to Employee under any severance plan of the Company that are due and payable solely as a result of a Change of Control.  In addition, Employee shall continue to be covered by any policy of insurance providing indemnification rights for service as an officer and director of the Company and to all other rights to indemnification provided by the Company, in each case at least as favorable as applicable to Employee on the date of this Agreement. 
 
Where Employee receives any benefit or payment provided for under this Agreement, he shall not be entitled to any benefit under the Senior Executive Officer Severance 

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Agreement and vice versa.  Under no circumstances may he be entitled to receive payment under both agreements.
7.    Enforcement.  It is the intent of the parties that Employee not be required to incur any expenses associated with the enforcement of Employee’s rights under this Agreement by arbitration, litigation or other legal action, because the cost and expense thereof would substantially detract from the benefits intended to be extended to Employee hereunder.  Accordingly, the Company shall pay Employee on demand the amount necessary to reimburse Employee in full for all expenses (including all attorneys’ fees and legal expenses) incurred by Employee in enforcing any of the obligations of the Company under this Agreement, unless the lawsuit brought by Employee is determined wholly or substantially in the Company’s favor.  The Company shall reimburse Employee for expenses under this Section 7 no later than the end of the calendar year next following the calendar year in which such expenses were incurred.  The Company shall not be obligated to pay any such expenses for which Employee fails to make a demand and submit an invoice or other documented reimbursement request at least 10 business days before the end of the calendar year next following the calendar year in which such expenses were incurred.  The amount of such expenses that the Company is obligated to pay in any given calendar year shall not affect the expenses that the Company is obligated to pay in any other calendar year.  Employee’s right to have the Company pay the expenses may not be liquidated or exchanged for any other benefit.
8.    No Mitigation.  Employee shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for herein be reduced by any compensation earned by other employment or otherwise. 
9.    Deductions or Set-Offs.  The Company reserves the right to make deductions in respect of all sums from time to time owed by Employee to the Company or any Associated Company, from Employee’s pay, bonus, allowances, expenses, or from any amounts which may be due to Employee by the Company pursuant to this Agreement.  By agreeing to the terms and conditions set out in this Agreement Employee consents to the deduction of such sums.  
10.    Taxes.  Any payments required under this Agreement shall be paid net of (i) taxes withheld or deducted by the Company in accordance with the requirements of law and (ii) deductions for the portion of the cost of certain benefits to be borne by Employee.  The Company reserves absolute discretion to determine the manner in which tax should be applied to any such amounts or benefits.
11.    Term of Agreement.  The term of this Agreement shall be for three years from the date hereof and shall be automatically renewed for successive one-year periods unless the Company notifies Employee in writing that this Agreement will not be renewed at least 60 days prior to the end of the current term; provided, however, that (i) this Agreement shall remain in effect for at least two years after a Change of Control occurring during the term of this Agreement and shall remain in effect until all of the 

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obligations of the parties hereunder are satisfied, and (ii) this Agreement shall terminate if, prior to but not in contemplation of a Change of Control, the employment of Employee with the Company and its affiliates shall terminate for any reason.
12.    Successor Company.  The Company shall require any successor or successors (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company, by agreement in form and substance satisfactory to Employee, to acknowledge expressly that this Agreement is binding upon and enforceable against the Company in accordance with the terms hereof, and to become jointly and severally obligated with the Company to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession or successions had taken place.  Failure of the Company to obtain such agreement prior to the effectiveness of any such succession shall be a breach of this Agreement.  As used in this Agreement, the Company shall mean the Company as herein before defined and any such successor or successors to its business or assets, jointly and severally.
13.    Notice.  All notices and other communications required or permitted hereunder or necessary or convenient in connection herewith shall be in writing and shall be delivered personally or mailed by registered or certified mail, return receipt requested, or by overnight express  courier service, as follows:
If to the Company, to:
Teleflex Incorporated
550 E. Swedesford Rd.
Suite 400
Wayne, PA 19087
Attn: General Counsel

If to Employee, to:
_______________________ 
        _______________________ 
        _______________________ 
        _______________________ 
        _______________________
or to such other names or addresses as the Company or Employee, as the case may be, shall designate by notice to the other party hereto in the manner specified in this Section; provided, however, that if no such notice is given by the Company following a Change of Control, notice at the last address of the Company or to any successor pursuant to Section 13 hereof shall be deemed sufficient for the purposes hereof.  Any such notice shall be deemed delivered and effective when received in the case of personal delivery, five days after deposit, postage prepaid, with the U.S. Postal Service in the case of 

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registered or certified mail, or on the next business day in the case of overnight express courier service.
14.    Governing Law.  This Agreement shall be governed by and interpreted under the laws of the Commonwealth of Pennsylvania without giving effect to any conflict of laws provisions.
15.    Contents of Agreement, Amendment and Assignment.  
(a)    This Agreement supersedes all prior agreements, sets forth the entire understanding between the parties hereto with respect to the subject matter hereof and cannot be changed, modified, extended or terminated except upon written amendment executed by Employee and approved by the Board and executed on the Company’s behalf by a duly authorized officer; provided, however, that except as stated in Section 6 above, this Agreement is not intended to supersede or alter Employee’s rights under any compensation, benefit plan or program, unless specifically modified hereunder, in which Employee participated and under which Employee retains a right to benefits.  The provisions of this Agreement may provide for payments to Employee under certain compensation or bonus plans under circumstances where such plans would not provide for payment thereof.  It is the specific intention of the parties that the provisions of this Agreement shall supersede any provisions to the contrary in such plans, to the extent that the provisions of this Agreement are more favorable to Employee than the terms of such plans, and such plans shall be deemed to have been amended to correspond with this Agreement without further action by the Company or the Board.
(b)    Nothing in this Agreement shall be construed as giving Employee any right to be retained in the employ of the Company and/or any subsidiary of the Company.
(c)     All of the terms and provisions of this Agreement, including the covenants of Section 4, shall be binding upon and inure to the benefit of and be enforceable by the respective heirs, representatives, successors and assigns of the parties hereto.
16.    Severability.  If any provision of this Agreement or application thereof to anyone or under any circumstances shall be determined to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions or applications of this Agreement which can be given effect without the invalid or unenforceable provision or application.
17.    Remedies Cumulative; No Waiver.  No right conferred upon Employee by this Agreement is intended to be exclusive of any other right or remedy, and each and every such right or remedy shall be cumulative and shall be in addition to any other right or remedy given hereunder or now or hereafter existing at law or in equity.  No delay or omission by Employee in exercising any right, remedy or power hereunder or existing at law or in equity shall be construed as a waiver thereof, including, without limitation, any delay by Employee in delivering a Notice of Termination pursuant to Section 2 hereof 

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after an event has occurred which would, if Employee had resigned, have constituted a Termination following a Change of Control pursuant to Section 1 of this Agreement.
18.    Miscellaneous.  All section headings are for convenience only.  This Agreement may be executed in several counterparts, each of which is an original.  It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts. 
19.    Construction.  The word “including” means “including without limitation.”

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IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have executed this Agreement as of the date first above written.
	
		
	 
	Teleflex Incorporated

By:    /s/ Liam Kelly          
Name: Liam Kelly 
Title: Executive Vice President and Chief Operating Officer

	 
	

   /s/ Karen Boylan      
Karen Boylan

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EXHIBIT A
GENERAL RELEASE
1.    I, ___________________, for and in consideration of certain payments to be made and the benefits to be provided to me under the Executive Change In Control Agreement, dated as of _______________ (the “Agreement”) with Teleflex Incorporated (the “Company”) and conditioned upon such payments and provisions, do hereby REMISE, RELEASE, AND FOREVER DISCHARGE the Company and each of its past or present subsidiaries and affiliates, its and their past or present officers, directors, stockholders, employees and agents, their respective successors and assigns, heirs, executors and administrators, the pension and employee benefit plans of the Company, or of its past or present subsidiaries or affiliates, and the past or present trustees, administrators, agents, or employees of the pension and employee benefit plans (hereinafter collectively included within the term the “Company”), acting in any capacity whatsoever, of and from any and all manner of actions and causes of actions, suits, debts, claims and demands whatsoever in law or in equity, which I ever had, now have, or hereafter may have, or which my heirs, executors or administrators hereafter may have, by reason of any matter, cause or thing whatsoever from the beginning of my employment with the Company to the date of these presents and particularly, but without limitation of the foregoing general terms, any claims arising from or relating in any way to my employment relationship and the termination of my employment relationship with the Company and/or any Associated Company, including but not limited to, any claims which have been asserted, could have been asserted, or could be asserted now or in the future under  the constitution, contract, common law, in equity, statute (in particular, but not limited to the Unfair Dismissals Acts 1977–2007, the Minimum Notice and Terms of Employment Acts 1973–2005, the Organisation of Working Time Act 1997, the Redundancy Payments Acts 1967–2014, the Terms of Employment (Information) Acts 1994–2014, the Payment of Wages Act 1991, the Maternity Protection Acts 1994-2004 and the National Minimum Wage Act 2000, the Safety Health and Welfare at Work Acts 2005 and 2010, the Employment Equality Acts 1998-2012, the Protection of Employment Acts 1977 to 2014, the Employees (Provision of Information and Consultation) Act 2006, the Protection of Employees (Part-Time) Work Act 2001, the Protection of Employees (Fixed-Term) Work Act 2003, the Adoptive Leave Acts 1995-2005, the Carer’s Leave Act 2001, the Data Protection Acts 1988-2003, the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003, the Industrial Relations Acts 1948-2015, the Parental Leave Acts 1998 and 2006, the Pensions Act 1990 (as amended), the Protection of Young Persons (Employment) Act 1996, the Protection of Employees (Temporary Agency Work) Act 2012, the Protected Disclosures Act 2014, the Workplace Relations Act 2015, as well as the Pennsylvania Human Relations Act, 43 Pa. C.S.A. §§951 et seq., the Rehabilitation Act of 1973, 29 USC §§701 et seq., Title VII of the Civil Rights Act of 1964, 42 USC §§2000e et seq., the Civil Rights Act of 1991, 2 USC §§60 et seq., the Age Discrimination in Employment Act of 1967, 29 USC §§621 et seq., the Americans with Disabilities Act, 29 USC §§706 et seq., and the Employee Retirement Income Security Act of 1974, 29 USC §§301 et seq.), the common law or 

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otherwise all as amended, and all claims for counsel fees and costs, any contracts between the Company and me and any common law claims now or hereafter recognized and all claims for counsel fees and costs; provided, however, that this Release shall not apply to any entitlements under the terms of the Agreement or under any other plans or programs of the Company in which I participated and under which I have accrued and become entitled to a benefit other than under any Company separation or severance plan or programs.  Finally, I waive and compromise any claim to take a personal injuries claim against the Company, the Group, any director, member or employee.

  
2.    Subject to the limitations of paragraph 1 above, I expressly waive all rights afforded by any statute which expressly limits the effect of a release with respect to unknown claims.  I understand the significance of this release of unknown claims and the waiver of statutory protection against a release of unknown claims.
3.    I hereby agree and recognize that my employment was permanently and irrevocably severed on ___________________, 20__ and the Company and its subsidiaries have no obligation, contractual or otherwise to me to hire, rehire or reemploy me in the future.  I acknowledge that the terms of the Agreement provide me with payments and benefits which are in addition to any amounts to which I otherwise would have been entitled.
4.    I hereby agree and acknowledge that the payments and benefits provided by the Company are to bring about an amicable resolution of my employment arrangements and are not to be construed as an admission of any violation of any federal, state or local statute or regulation, or of any duty owed by the Company and that the Agreement was, and this Release is, executed voluntarily to provide an amicable resolution of my employment relationship with the Company.
5.    I hereby acknowledge that nothing in this Release shall prohibit or restrict me from: (i) making any disclosure of information required by law; (ii) providing information to, or testifying or otherwise assisting in any investigation or proceeding brought by, any federal regulatory or law enforcement agency or legislative body, any self-regulatory organization, or the Company’s designated legal, compliance or human resources officers; or (iii) filing, testifying, participating in or otherwise assisting in a proceeding relating to an alleged violation of any federal, state or municipal law relating to fraud, or any rule or regulation of the Securities and Exchange Commission or any self-regulatory organization.  In addition, I understand that each of the parties hereto (and each employee, representative, or other agent of such parties) may disclose to any person, without limitation of any kind, the federal income tax treatment and federal income tax structure of the transactions contemplated hereby and all materials (including opinions or other tax analyses) that are provided to such party relating to such tax treatment and tax structure.

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6.    I hereby certify that I have read the terms of this Release, that I have been advised by the Company to discuss it with my attorney, that I have received the advice of counsel and that I understand its terms and effects.  I acknowledge, further, that I am executing this Release of my own volition with a full understanding of its terms and effects and with the intention of releasing all claims recited herein in exchange for the consideration described in the Agreement, which I acknowledge is adequate and satisfactory to me.  None of the above named parties, nor their agents, representatives or attorneys have made any representations to me concerning the terms or effects of this Release other than those contained herein.
7.    I hereby further acknowledge that the terms of Sections 4 and 5 of the Agreement shall continue to apply for the balance of the time periods provided therein and that I will abide by and fully perform such obligations.
[SIGNATURE PAGE FOLLOWS]

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Intending to be legally bound hereby, I execute the foregoing Release this ___ day of _____________, 20 ___.
________________________                ____________________
Witness

A-4Exhibit

CITIZENS BANK, NATIONAL ASSOCIATION
90 State House Square  
Hartford, Connecticut 06103

April 25, 2016

David C. Benoit
Vice President-Finance and Treasurer
Connecticut Water Service, Inc.
93 West Main Street
Clinton, CT 06413

Re:    Modification of Revolving Credit Facility

Dear Mr. Benoit:

We are pleased to confirm the willingness of Citizens Bank, National Association (the “Bank”) to amend the terms and conditions of the existing demand revolving credit facility (the “Facility”) provided to Connecticut Water Service, Inc. (the “Company”) pursuant to a letter agreement between the Bank and the Company dated as of May 8, 2002 (as amended and in effect, the “Letter Agreement”), as amended by that certain letter agreement between the Bank and the Company dated as of May 17, 2002, by that certain letter agreement between the Bank and the Company dated as of June 12, 2003, by that certain letter agreement between the Bank and the Company dated as of March 12, 2004, by that certain letter agreement between the Bank and the Company dated as of January 30, 2006, by that certain letter agreement between the Bank and the Company dated as of November 20, 2007, by that certain letter agreement between the Bank and the Company dated as of September 15, 2009, by that certain letter agreement between the Bank and the Company dated as of May 5, 2010, by that certain letter agreement between the Bank and the Company dated as of June 1, 2011, by that certain letter agreement between the Bank and the Company dated as of October 12, 2012, by that certain letter agreement between the Bank and the Company dated as of November 25, 2013, by that certain letter agreement between the Bank and the Company dated as of October 14, 2014.  The Letter Agreement is hereby amended as follows:

1.    Paragraph 1 of the Letter Agreement, entitled “Amount” is hereby deleted in its entirety, and replaced with the following:

The aggregate principal amount of loans and advances (“Advances”) outstanding under the Facility shall not exceed $45,000,000 at any time during the period commencing on the effective date of this Letter Agreement and terminating on the Maturity Date.

2.    Paragraph 2 of the Letter Agreement, entitled “Term”, is hereby is hereby deleted in its entirety, and replaced with the following:

“This Facility shall expire, terminate and be repayable on April 25, 2021 (the “Maturity Date”), unless renewed by the Bank.”

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3.    Any and all references to the “Maturity Date” set forth in the Letter Agreement shall be amended to refer to, and mean, April 25, 2021, 2021.

4.    Paragraphs 4, 5 and 6 of the Letter Agreement, respectively entitled “Utilization”, “Interest” and “Payments”, are hereby amended and restated in their entireties as set forth on Schedule 1, attached hereto.

5.    Paragraph 8 of the Letter Agreement, entitled “Unused Fee”, is hereby deleted in its entirety, and replaced with the following:

“8.    Unused Fee.  

In consideration of the Bank’s agreement to make the Facility available to the Company, the Company shall pay to the Bank a non-refundable “Unused Fee” at the rate of 0.05% (i.e. 5.00 basis points) per annum multiplied by the average daily unused portion of the Facility (the “Unused Fee”).  The Unused Fee shall be payable quarterly in arrears, on the first day of each calendar quarter and computed on the basis of a 360-day year and assessed for the actual number of days elapsed.”

6.    Paragraph 10 of the Letter Agreement, entitled “Financial Reporting”, is hereby deleted in its entirety, and replaced with the following:

10.    Financial Reporting.

As soon as available, but in no event later than April 30 in each year, the Company shall provide the Bank with copies of the Company’s audited financial statements for the Company’s most recently ended fiscal year.  In addition, the Company agrees to provide the Bank with copies of any and all reports issued by the Company to its shareholders, including Form 10-Q and Form 10-K, no later than forty-five (45) days from the end of each fiscal quarter, an annual budget with supporting details no later than thirty (30) days prior to the start of each fiscal year, and such additional information as the Bank may from time to time request.

As soon as available, but in no event later than May 31 in each year, the Company shall cause The Connecticut Water Company to provide the Bank with copies of The Connecticut Water Company’s audited financial statements for the most recently ended fiscal year.  In addition, the Company agrees to cause The Connecticut Water Company to provide the Bank with copies of The Connecticut Water Company’s quarterly internally prepared financial statements, no later than forty-five (45) days from the end of each fiscal quarter, and such additional information as the Bank may from time to time request.

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No later than forty-five (45) days from the end of each fiscal quarter, the Company shall deliver to Bank a covenant compliance certificate, in form and substance acceptable to Bank, setting forth the Company’s, The Connecticut Water Company’s and The Maine Water Company’s compliance with, as applicable, the financial covenants set forth in Paragraph 13.

7.    Subsection (b), (c) and (d) of Paragraph 11, entitled “Costs” are hereby deleted in their entirety.

8.    Paragraph 13 of the Letter Agreement, entitled “Representations, Warranties and Covenants” is hereby amended by adding the following five (5) paragraphs to the end thereof:

The Company hereby covenants that the ratio of the The Connecticut Water Company’s earnings before interest and taxes to the The Connecticut Water Company’s interest expense shall be equal to or greater than 3:00 to 1:00, as determined by the Bank in its reasonable discretion. The foregoing covenant shall be tested as of the last day of each fiscal quarter, based on the fiscal quarter then ended.  The foregoing covenant replaces that certain earnings before interest and taxes to expense covenant set forth in that certain Letter Agreement dated October 12, 2012.

The Company hereby covenants that The Maine Water Company shall not permit the ratio of its debt to capitalization to exceed sixty percent (60%), as determined by the Bank in its reasonable discretion. The foregoing covenant shall be tested as of the last day of each fiscal quarter, based on the fiscal quarter then ended.

The Company hereby covenants that The Connecticut Water Company shall not permit the ratio of its debt to capitalization to exceed sixty percent (60%), as determined by the Bank in its reasonable discretion. The foregoing covenant shall be tested as of the last day of each fiscal quarter, based on the fiscal quarter then ended.

The Company hereby covenants that it shall not permit the ratio of its debt to capitalization to exceed sixty-five percent (65%), as determined by the Bank in its reasonable discretion. The foregoing covenant shall be tested as of the last day of each fiscal quarter, based on the fiscal quarter then ended. The foregoing covenant replaces that certain debt to capitalization covenant set forth in that certain Letter Agreement dated October 12, 2012.

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Any failure of the Company to comply with the provisions of this Paragraph 13 shall constitute a default hereunder, permitting Bank to terminate this Facility and demand immediate repayment of the Facility.

9.    Paragraph 16, entitled “Cross-Default” is hereby amended and restated as follows:

In the event that the Company or any subsidiary of the Company, should, after any applicable grace period, be in default under the terms of any other agreement with Bank or any affiliate of Bank, or any other lender, then any such default shall constitute a default hereunder, permitting Bank to terminate this Facility and demand immediate repayment of this Facility.

10.    Amendment to Demand Promissory Note.  The Demand Promissory Note dated May 8, 2002 made by the Company as Maker to the order of the Bank as Payee is hereby amended to increase the principal amount thereof to $45,000,000, which amendment shall be evidenced by an allonge to the Demand Promissory Note executed by the Company in substantially the form attached hereto as Exhibit A (the “Fourth Allonge”), which Fourth Allonge shall be permanently attached to the Demand Promissory Note, and which Fourth Allonge is hereby incorporated in the Letter Agreement by reference and made a part thereof.

Please confirm the Company’s acceptance of the foregoing amendment to the Facility by signing and returning to us the enclosed copy of this letter.

CITIZENS BANK, NATIONAL ASSOCIATION 

By:  /s/  Anthony Castellon
      Name:  Anthony Castellon
                                Title:  Senior Vice President

The Company hereby agrees to and accepts the terms and conditions contained in the foregoing letter and confirms that the Bank, shall be entitled but shall not be obliged, to rely upon and act in accordance with any communication (whether a request for an Advance under this Facility or any other notice, request, instruction or other communication whatsoever) which may be or purport to be given by telephone or facsimile transmission on the Company’s behalf by any person notified to the Bank by the Company as being authorized to give such communication without inquiry by the Bank to make such communication.  The Company hereby indemnifies the Bank and agrees to hold it harmless against all losses, claims, actions, proceedings, damages, costs and expenses incurred or sustained by the Bank as a result thereof or in connection therewith.

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The persons authorized to give communication on the Company’s behalf are the persons named on the certificate of incumbency delivered to the Bank pursuant to Paragraph 9(e) of the Letter Agreement.
    
CONNECTICUT WATER SERVICE, INC.

By:  /s/  David C. Benoit
      Name:  David C. Benoit
      Title:  Senior Vice President – Finance, 
          Chief Financial Officer and Treasurer

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EXHIBIT A

(ATTACH ALLONGE)

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SCHEDULE 1

4.    Utilization.

The Company may utilize the Facility in whole or in part in the form of:  (a) Advances bearing interest at the Prime Rate; (b) Advances bearing interest at a rate determined by reference to the LIBOR Rate; and (c) Advances bearing interest at a rate determined by reference to the LIBOR Advantage Rate.  Advances of whatever type may be used to support the Company’s working capital needs, dividend reinvestment purchases and interim capital expenditure funding.  Advances under the Facility shall be available in the sole and absolute discretion of the Bank and shall be in amounts, which are at least $100,000.  Each request for an Advance shall be in writing and shall be in the form attached hereto as Exhibit B (or such other form as may be required by Bank).  Without limiting the foregoing, by delivering a borrowing request on or before 10:00 a.m., New York time, on a Business Day, the Borrower may from time to time irrevocably request, on not less than two nor more than five Business Days’ notice, that a LIBOR Rate Loan be made in a minimum amount of $100,000 and integral multiples of $100,000, with a LIBOR Interest Period of one (1) or three (3) months.  On the terms and subject to the conditions of this agreement, each LIBOR Rate Loan shall be made available to the Borrower no later than 11:00 a.m. New York time on the first day of the applicable LIBOR Interest Period by deposit to the account of the Borrower as shall have been specified in its borrowing request.  Capitalized terms utilized in this Paragraph 4 and not otherwise defined in this Paragraph 4 shall have the meaning ascribed to such terms in Paragraph 5 hereof. By delivering a conversion notice to the Bank on or before 10:00 a.m., New York time, on a Business Day, the Borrower may from time to time irrevocably elect, on not less than two nor more than five Business Days’ notice, that all or any portion of any LIBOR Rate Loan, in an aggregate minimum amount of $100,000 and integral multiples of $100,000,be converted on the last day of a LIBOR Interest Period into a LIBOR Rate Loan with a different LIBOR Interest Period; provided, however, that no portion of the outstanding principal amount of any LIBOR Rate Loan may be converted to, or be continued as, a LIBOR Rate Loan when any Event of Default has occurred and is continuing.  In the absence of delivery of a conversion notice with respect to any LIBOR Rate Loan at least two Business Days before the last day of the then current LIBOR Interest Period with respect thereto, such LIBOR Rate Loan shall, on such last day, automatically continue as a LIBOR Rate Loan with the same LIBOR Interest Period.

5.    Interest.  Advances shall bear interest, at the option of the Bank, at either:

		
	(a)
	a fluctuating rate equal to the Bank’s Prime Rate in effect from time to time, plus the Applicable Margin; 

		
	(b)
	a rate equal to the LIBOR Rate for maturities of one (1) or three (3) months, as requested by the Borrower, plus the Applicable Margin; or

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	(c)
	a rate equal to the LIBOR Advantage Rate for maturities of one (1) or three (3) months, as requested by the Borrower, plus the Applicable Margin.

Interest on the outstanding principal amount of each Advance, when classified as a: (i) LIBOR Rate Loan, shall accrue during each LIBOR Interest Period at a rate per annum equal to the sum of the Adjusted LIBOR Rate for such LIBOR Interest Period plus the Applicable Margin, and be due and payable on each Interest Payment Date and on the Maturity Date, (ii) LIBOR Advantage Rate Loan, shall accrue during each LA Interest Period at a rate per annum equal to the sum of the LIBOR Advantage Rate plus the Applicable Margin, and be due and payable on each Interest Payment Date and on the Maturity Date, and (iii) Prime Rate Loan, shall accrue at a rate per annum equal to the sum of the Prime Rate plus the Applicable Margin, and be due and payable on each Interest Payment Date and on the Maturity Date. 
Definitions:

(a)    “Applicable Margin” means one and ninety one-hundredths percent (1.90%) per annum. 

(b)    “Business Day” means:

(i)      any day which is neither a Saturday or Sunday nor a legal holiday on which commercial banks are authorized or required to be closed in Hartford, Connecticut;

(ii)      when such term is used to describe a day on which a borrowing, payment, prepaying, or repaying is to be made in respect of any LIBOR Rate Loan or LIBOR Advantage Rate Loan, any day which is: (i) neither a Saturday or Sunday nor a legal holiday on which commercial banks are authorized or required to be closed in New York City; and (ii) a London Banking Day; and

(iii)    when such term is used to describe a day on which an interest rate determination is to be made in respect of any LIBOR Rate Loan or LIBOR Advantage Rate Loan, any day which is a London Banking Day.

(c)    “Interest Payment Date” means the last Business Day of such LIBOR Interest Period with respect to LIBOR Rate Loans and LIBOR Advantage Rate Loans and in the case of Prime Rate Loans, the first day of each month.
(d)    “LIBOR Interest Period” means
(i)    relative to any LIBOR Rate Loan or LIBOR Advantage Rate Loan:
initially, the period beginning on (and including) the date on which such LIBOR Rate Loan or LIBOR Advantage Rate Loan is made or continued as, or converted into, a LIBOR Rate Loan or LIBOR Advantage Rate Loan pursuant to the terms of this Letter Agreement and ending on (but excluding) the day which numerically 

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corresponds to such date one (1) or three (3) months thereafter (or, if such month has no numerically corresponding day, on the last Business Day of such month), in each case as the Borrower may select in its notice pursuant to the terms of this Letter Agreement; and
thereafter, each period commencing on the last day of the next preceding LIBOR Interest Period applicable to such LIBOR Rate Loan or LIBOR Advantage Rate Loan and ending one (1) or three (3) months thereafter, as selected by the Borrower by irrevocable notice to the Bank pursuant to the terms hereof;
provided, however, that
		
	(a)
	at no time may there be more than five (5) LIBOR Interest Periods in effect with respect to the LIBOR Rate Loans or LIBOR Advantage Rate Loans;

		
	(b)
	LIBOR Interest Periods commencing on the same date for LIBOR Rate Loans or LIBOR Advantage Rate Loans comprising part of the same advance under this agreement shall be of the same duration;

		
	(c)
	if such LIBOR Interest Period would otherwise end on a day which is not a Business Day, such LIBOR Interest Period shall end on the next following Business Day unless such day falls in the next calendar month, in which case such LIBOR Interest Period shall end on the first preceding Business Day; and

		
	(d) 
	no LIBOR Interest Period may end later than the termination of this agreement.

(ii)   relative to any LIBOR Advantage Loan:
The period commencing on (and including) April 25, 2016 (the “Start Date”) and ending on the numerically corresponding date one (1) or three (3) months later (as may be selected), and thereafter each one (1) or three (3) month period (which period must match the initial selection) ending on the day of such month that numerically corresponds to the Start Date.  If a LA Interest Period is to end in a month for which there is no day which numerically corresponds to the Start Date, the LA Interest Period will end on the last day of such month.  

(e)    “LIBOR Rate” means, relative to any LIBOR Interest Period, the offered rate for deposits of U.S. Dollars for a term coextensive with the designated LIBOR Interest Period which the ICE Benchmark Administration (or any successor administrator of LIBOR rates) fixes as its LIBOR rate as of 11:00 a.m. London time on the day which is two London Banking Days prior to the beginning of such LIBOR Interest Period.  If such day is not a London Banking Day, the LIBOR Rate shall be determined on the next preceding day which is a London Banking Day.  If for any reason the Bank cannot determine such offered rate fixed by the then current 

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administrator of LIBOR rates, the Bank may, in its sole but reasonable discretion, use an alternative method to select a rate calculated by the Bank to reflect its cost of funds.

(f)    “LIBOR Advantage Rate” means, relative to any LIBOR Interest Period, the offered rate for deposits of U.S. Dollars for a term coextensive with the designated LIBOR Interest Period, reset daily, which the ICE Benchmark Administration (or any successor administrator of LIBOR rates) fixes as its LIBOR rate as of 11:00 a.m. London time for delivery in two London Banking Days.  If such day is not a London Banking Day, the LIBOR Advantage Rate shall be determined on the next preceding day which is a London Banking Day.  If for any reason the Bank cannot determine such offered rate fixed by the then current administrator of LIBOR rates, the Bank may, in its sole but reasonable discretion, use an alternative method to select a rate calculated by the Bank to reflect its cost of funds.

(g)    “LIBOR Advantage Rate Loan” means any loan or Advance the rate of interest applicable to which is based upon the LIBOR Advantage Rate.
(h)    “LIBOR Rate Loan” means any loan or Advance the rate of interest applicable to which is based upon the LIBOR Rate.
(i)    “Adjusted LIBOR Rate” means, relative to any LIBOR Rate Loan to be made, continued or maintained as, or converted into, a LIBOR Rate Loan for any LIBOR Interest Period, a rate per annum determined by dividing (x) the LIBOR Rate for such LIBOR Interest Period by (y) a percentage equal to one hundred percent (100%) minus the LIBOR Reserve Percentage.
(j)    “LIBOR Reserve Percentage” means, relative to any day of any LIBOR Interest Period, the maximum aggregate (without duplication) of the rates (expressed as a decimal fraction) of reserve requirements (including all basic, emergency, supplemental, marginal and other reserves and taking into account any transitional adjustments or other scheduled changes in reserve requirements) under any regulations of the Board of Governors of the Federal Reserve System (the “Board”) or other governmental authority having jurisdiction with respect thereto as issued from time to time and then applicable to assets or liabilities consisting of “Eurocurrency Liabilities”, as currently defined in Regulation D of the Board, having a term approximately equal or comparable to such LIBOR Interest Period.
(k)    “London Banking Day” means a day on which dealings in US dollars deposits are transacted in the London interbank market.
(l)    “Prime Rate” shall mean a rate per annum equal to the rate of interest announced by Bank in Hartford, Connecticut from time to time as its “Prime Rate.”  Any change in the Prime Rate shall be effective immediately from and after such change in the Prime Rate. Interest accruing by reference to the Prime Rate shall be calculated on the basis of actual days elapsed and a 360-day year.  The Borrower acknowledges that the Bank may make loans to its customers above, at or below the Prime Rate.

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(m)    “Prime Rate Loan” means any loan or Advance the rate of interest applicable to which is based upon the Prime Rate.
6.    Payments; Principal and Interest.

(a)    Principal.  Subject to Subsection (c), the principal amount of any Advance or loan hereunder shall be due and payable on the Maturity Date (or any renewal thereof).  

(b)    Interest.  Accrued and unpaid interest on the outstanding principal amount of any Advance or loan hereunder shall be due and payable upon the earliest of:

(i)    the Maturity Date (or any renewal thereof);

(ii)    in the case of Prime Rate Loans, monthly in arrears on the first day of each month and when any such Advance is due;

(iii)    in the case of LIBOR Rate Loans and LIBOR Advantage Rate Loans, on the Interest Payment Date thereof.

(c)    Repayments Continuations and Conversions.  Each Advance bearing interest at the LIBOR Rate shall mature and become payable in full on the last day of the LIBOR Interest Period relating to such Advance.  On the last day of the applicable LIBOR Interest Period, an Advance bearing interest at the LIBOR Rate may be continued for an additional LIBOR Interest Period or may be converted to a Prime Rate Loan or a LIBOR Advantage Loan.  
(d)    Voluntary Prepayment.  Loans bearing interest at the LIBOR Advantage Rate or the Prime Rate may be prepaid in whole or in part at any time without premium or penalty.  Loans bearing interest at the LIBOR Rate may be prepaid upon the following terms and conditions: the Borrower shall give the Bank, no later than 10:00 a.m., New York City time, at least four (4) Business Days’ notice of any proposed prepayment of any Advance bearing interest at the LIBOR Rate, specifying the proposed date of payment and the principal amount to be paid.  Each partial prepayment of the principal amount of any Advance bearing interest at the LIBOR Rate shall be in an integral multiple of $100,000 and accompanied by the payment of all charges outstanding on such loan (including the LIBOR Breakage Fee) and of all accrued interest on the principal repaid to the date of payment.  
(e)    LIBOR Breakage Fee.  Upon: (i) any default by Borrower in making any borrowing of, conversion into or continuation of any loan bearing interest at the LIBOR Rate following Borrower’s delivery of a borrowing request or conversion notice hereunder or (ii) any prepayment of any loan bearing interest at the LIBOR Rate on any day that is not the last day of the relevant LIBOR Interest Period (regardless of the source of such prepayment and whether voluntary, by acceleration or otherwise), the Borrower shall pay an amount (“LIBOR Breakage Fee”), as calculated by the Bank, equal to the amount of any losses, expenses and liabilities (including without limitation any loss of 

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margin and anticipated profits) that Bank may sustain as a result of such default or payment.  The Borrower understands, agrees and acknowledges that: (i) the Bank does not have any obligation to purchase, sell and/or match funds in connection with the use of the LIBOR Rate as a basis for calculating the rate of interest on a loan bearing interest at the LIBOR Rate, (ii) the LIBOR Rate may be used merely as a reference in determining such rate, and (iii) the Borrower has accepted the LIBOR Rate as a reasonable and fair basis for calculating the LIBOR Breakage Fee and other funding losses incurred by the Bank.  Borrower further agrees to pay the LIBOR Breakage Fee and other funding losses, if any, whether or not the Bank elects to purchase, sell and/or match funds.
(f)    Miscellaneous Provisions for LIBOR Rate Loans.

		
	(i)
	Lending Unlawful.  If the Bank shall determine (which determination shall, upon notice thereof to the Borrower be conclusive and binding on the Borrower) that the introduction of or any change in or in the interpretation of any law, rule, regulation or guideline, (whether or not having the force of law) makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful, for the Bank to make, continue or maintain any LIBOR Rate Loan or LIBOR Advantage Rate Loan as, or to convert any loan into, a LIBOR Rate Loan or LIBOR Advantage Rate Loan of a certain duration, the obligations of the Bank to make, continue, maintain or convert into any such LIBOR Rate Loans or LIBOR Advantage Rate Loans shall, upon such determination, forthwith be suspended until the Bank shall notify the Borrower that the circumstances causing such suspension no longer exist, and all LIBOR Rate Loans and LIBOR Advantage Rate Loans of such type shall automatically convert into Prime Rate Loans at the end of the then current LIBOR Interest Periods with respect thereto or sooner, if required by such law or assertion.

		
	(ii)
	Unavailability of Rate.  In the event that Borrower shall have requested a LIBOR Rate Loan or LIBOR Advantage Rate Loan in accordance with the terms hereof and the Bank, in its sole discretion, shall have determined that U.S. dollar deposits in the relevant amount and for the relevant LIBOR Interest Period are not available to the Bank in the London interbank market; or by reason of circumstances affecting the Bank in the London interbank market, adequate and reasonable means do not exist for ascertaining the LIBOR Rate or LIBOR Advantage Rate applicable to the relevant LIBOR Interest Period; or the LIBOR Rate or LIBOR Advantage Rate no longer adequately and fairly reflects the Bank’s cost of funding loans; upon notice from the Bank to the Borrower, the obligations of the Bank under the terms hereof to make or continue any loans as, or to convert any loans into, LIBOR Rate Loans or LIBOR Advantage Rate Loans of such duration shall forthwith be suspended until the Bank shall notify the Borrower that the circumstances causing such suspension no longer exist.

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	(iii)
	Increased Costs.  If, on or after the date hereof, the adoption of any applicable law, rule or regulation or guideline (whether or not having the force of law), or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by the Bank with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency: (a) shall impose, modify or deem applicable any reserve, special deposit or similar requirement (including, without limitation, any such requirement imposed by the Board of Governors of the Federal Reserve System of the United States) against assets of, deposits with or for the account of, or credit extended by, the Bank or shall impose on the Bank or on the London interbank market any other condition affecting its LIBOR Rate Loans or LIBOR Advantage Rate Loans or its obligation to make LIBOR Rate Loans or LIBOR Advantage Rate Loans; or (b) shall impose on the Bank any other condition affecting its LIBOR Rate Loans or LIBOR Advantage Rate Loans or its obligation to make LIBOR Rate Loans or LIBOR Advantage Rate Loans, and the result of any of the foregoing is to increase the cost to the Bank of making or maintaining any LIBOR Rate Loan or LIBOR Advantage Rate Loan, or to reduce the amount of any sum received or receivable by the Bank under this agreement with respect thereto, by an amount deemed by the Bank to be material, then, within 15 days after demand by the Bank, the Borrower shall pay to the Bank such additional amount or amounts as will compensate the Bank for such increased cost or reduction.

		
	(iv)
	Increased Capital Costs.  If any change in, or the introduction, adoption, effectiveness, interpretation, reinterpretation or phase-in of, any law or regulation, directive, guideline, decision or request (whether or not having the force of law) of any court, central bank, regulator or other governmental authority affects or would affect the amount of capital required or expected to be maintained by the Bank, or person controlling the Bank, and the Bank determines (in its sole and absolute discretion) that the rate of return on its or such controlling person’s capital as a consequence of its commitments or the loans made by the Bank is reduced to a level below that which the Bank or such controlling person could have achieved but for the occurrence of any such circumstance, then, in any such case upon notice from time to time by the Bank to the Borrower, the Borrower shall immediately pay directly to the Bank additional amounts sufficient to compensate the Bank or such controlling person for such reduction in rate of return.  A statement of the Bank as to any such additional amount or amounts (including calculations thereof in reasonable detail) shall, in the absence of manifest error, be conclusive and binding on the Borrower.  In determining such amount, the Bank may use any 

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method of averaging and attribution that it (in its sole and absolute discretion) shall deem applicable.
		
	(v)
	Taxes.  All payments by the Borrower of principal of, and interest on, LIBOR Rate Loans and LIBOR Advantage Rate Loans and all other amounts payable hereunder shall be made free and clear of and without deduction for any present or future income, excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding franchise taxes and taxes imposed on or measured by the Bank’s net income or receipts (such non-excluded items being called “Taxes”).  In the event that any withholding or deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes pursuant to any applicable law, rule or regulation, then the Borrower will

pay directly to the relevant authority the full amount required to be so withheld or deducted;
promptly forward to the Bank an official receipt or other documentation satisfactory to the Bank evidencing such payment to such authority; and
pay to the Bank such additional amount or amounts as is necessary to ensure that the net amount actually received by the Bank will equal the full amount the Bank would have received had no such withholding or deduction been required.
Moreover, if any Taxes are directly asserted against the Bank with respect to any payment received by the Bank hereunder, the Bank may pay such Taxes and the Borrower will promptly pay such additional amount (including any penalties, interest or expenses) as is necessary in order that the net amount received by the Bank after the payment of such Taxes (including any Taxes on such additional amount) shall equal the amount the Bank would have received had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Bank the required receipts or other required documentary evidence, the Borrower shall indemnify the Bank for any incremental Taxes, interest or penalties that may become payable by the Bank as a result of any such failure.

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