Document:

exv4w3

Exhibit 4.3

Execution Version

FIRST SUPPLEMENTAL INDENTURE

     First Supplemental Indenture (this “Supplemental Indenture”), dated as of February 2, 2011,
among Targa Resources Partners LP, a Delaware limited partnership (“Targa Resources Partners”),
Targa Resources Partners Finance Corporation (“Finance Corporation” and, together with Targa
Resources Partners, the “Issuers”), the Guarantors (as defined in the Indenture referred to herein)
and U.S. Bank National Association, as trustee under the Indenture referred to below (the
“Trustee”).

W I T N E S S E T H

     WHEREAS, the Issuers and the Guarantors have heretofore executed and delivered to the Trustee
an indenture (the “Indenture”), dated as of July 6, 2009 providing for the issuance of 111/4% Senior
Notes due 2017 (the “Notes”);

     WHEREAS, Section 9.02 of the Indenture provides that the Issuers, the Guarantors and the
Trustee may, with the consent of the Holders of a majority in aggregate principal amount of the
then outstanding Notes (including consents obtained in connection with a tender offer or exchange
offer for the Notes), amend or supplement the Indenture, subject to certain limitations set forth
in the Indenture;

     WHEREAS, each Issuer has been authorized by resolutions of its board of directors to enter
into this Supplemental Indenture (the “Resolutions”);

     WHEREAS, the Issuers desire to amend certain provisions of the Indenture, as set forth in
Article I of this Supplemental Indenture (the “Proposed Amendments”);

     WHEREAS, the Issuers have offered to exchange any and all of the outstanding Notes for new
notes and cash, and have solicited consents to the Proposed Amendments, upon the terms and subject
to the conditions set forth in the Offering Memorandum and Consent Solicitation Statement dated
January 19, 2011, including any and all exhibits thereto and any information incorporated by
reference therein, as the same may be amended, supplemented or modified (the “Offering
Memorandum”); and

     WHEREAS, the Issuers have delivered to the Trustee (i) the Resolutions, (ii) evidence of the
receipt of the requisite consents to effect the Proposed Amendments under the Indenture and (iii)
the documents required by Section 9.06 of the Indenture.

     NOW, THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto mutually covenant
and agree for the equal and ratable benefit of the Holders of the Notes as follows:

ARTICLE I

AMENDMENTS TO THE INDENTURE

     Section 1.01 Amendments. Upon written notification to the Trustee by the Issuers that
they have accepted for exchange (the “First Settlement Date”) all of the Notes validly tendered and
not withdrawn at or prior to 5:00 p.m., New York City time, on February 1, 2011, pursuant to the
Offering Memorandum, then automatically (without further act by any person), the following
amendments shall be made to the Indenture:

 

 

	 	A.	 	the following sections of the Indenture are hereby deleted and the Issuers shall be
released from their obligations thereunder:

	 	a.	 	Section 3.09. Offer to Purchase by Application of Excess Proceeds
	 
	 	b.	 	Section 4.03. Reports (except as required by Section 314(a) of the
TIA)
	 
	 	c.	 	Section 4.04. Compliance Certificate
	 
	 	d.	 	Section 4.05. Taxes
	 
	 	e.	 	Section 4.06. Stay, Extension and Usury Laws
	 
	 	f.	 	Section 4.07. Restricted Payments
	 
	 	g.	 	Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries
	 
	 	h.	 	Section 4.09. Incurrence of Indebtedness and Issuance of
Disqualified Equity
	 
	 	i.	 	Section 4.10. Asset Sales
	 
	 	j.	 	Section 4.11. Transactions with Affiliates
	 
	 	k.	 	Section 4.12. Liens
	 
	 	l.	 	Section 4.14. Corporate Existence
	 
	 	m.	 	Section 4.15. Offer to Repurchase Upon Change of Control
	 
	 	n.	 	Section 4.16. Limitation on Sale and Leaseback Transactions
	 
	 	o.	 	 Section 4.17. Payments for Consent
	 
	 	p.	 	Section 4.18. Additional Guarantees
	 
	 	q.	 	Section 4.19. Designation of Restricted and Unrestricted
Subsidiaries
	 
	 	r.	 	Clauses (3) and (4) of Section 5.01(a). Merger, Consolidation, or
Sale of Assets
	 
	 	s.	 	Clauses (6) and (7) of Section 6.01. Events of Default

	 	B.	 	failure to comply with the terms of any of the foregoing sections of the Indenture
shall no longer constitute a default or an Event of Default under the Indenture and shall
no longer have any other consequences under the Indenture; and
	 
	 	C.	 	all definitions set forth in Sections 1.01 and 1.02 of the Indenture that relate to
defined terms used solely in covenants or sections deleted hereby are deleted in their
entirety.

     Section 1.02 Amendments to Notes. The Notes are hereby amended to delete all
provisions inconsistent with the amendments to the Indenture effected by this Supplemental
Indenture.

2

 

ARTICLE
II

MISCELLANEOUS

     Section 2.01 Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.

     Section 2.02 Instruments To Be Read Together. This Supplemental Indenture is executed
as and shall constitute an indenture supplemental to and in implementation of the Indenture, and
said Indenture and this Supplemental Indenture shall henceforth be read together. This Supplemental
Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes shall be
bound hereby and thereby.

     Section 2.03 Confirmation. The Indenture and the Notes as amended and supplemented by
this Supplemental Indenture are in all respects confirmed and preserved.

     Section 2.04 TIA Controls. If any provision of this Supplemental Indenture limits,
qualifies or conflicts with another provision that is required to be included in this Supplemental
Indenture or the Indenture by the TIA, as in force at the date that this Supplemental Indenture is
executed, the provisions required by such TIA shall control.

     Section 2.05 NEW YORK LAW TO GOVERN. THE LAW OF THE STATE OF NEW YORK SHALL GOVERN
AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.

     Section 2.06 Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them together represent
the same agreement.

     Section 2.07 Effect of Headings. The Section headings herein are for convenience only
and shall not affect the construction hereof.

     Section 2.08 Effectiveness; Termination. The provisions of this Supplemental Indenture
will become effective immediately upon its execution by the Trustee in accordance with the
provisions of Section 9.02 and 9.06 of the Indenture; provided, that the amendments to the
Indenture set forth in Article I of this Supplemental Indenture shall become operative as specified
in Article I hereof. Prior to the First Settlement Date, the Issuers may terminate this
Supplemental Indenture upon written notice to the Trustee (it being understood that the Issuers,
subsequent thereto, will enter into a substitute supplemental indenture).

     Section 2.09 Acceptance by the Trustee. The Trustee accepts the amendments to the
Indenture effected by this Supplemental Indenture and agrees to execute the trusts created by the
Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture.

     Section 2.10 The Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for
or in respect of the recitals contained herein, all of which recitals are made solely by the
Issuers and the Guarantors.

3

 

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

	 	 	 	 	 
	 	TARGA RESOURCES PARTNERS LP

By: Targa Resources GP LLC,

         Its General Partner

 	 
	 	By:  	/s/ Matthew J. Meloy
 	 
	 	 	Name:  	Matthew J. Meloy 	 
	 	 	Title:  	Senior Vice President,
Chief Financial Officer and
Treasurer 	 
	 

	 	 	 	 	 
	 	TARGA RESOURCES PARTNERS FINANCE CORPORATION

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA DOWNSTREAM LP

By: Targa Downstream GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

Signature Page to First Supplemental Indenture

 

	 	 	 	 	 
	 	TARGA LIQUIDS MARKETING AND TRADE

By: Targa Downstream LP,

        Its Managing Partner

By: Targa Downstream GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	
TARGA LSNG LP

By: Targa LSNG GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA MIDSTREAM SERVICES LIMITED PARTNERSHIP

By: Targa Resources Texas GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

Signature Page to First Supplemental Indenture

 

	 	 	 	 	 
	 	

TARGA NORTH TEXAS LP

By: Targa North Texas GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA PERMIAN LP

By: Targa Resources Texas GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA RESOURCES OPERATING LP

By: Targa Resources Operating GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

Signature Page to First Supplemental Indenture

 

	 	 	 	 	 
	 	TARGA STRADDLE LP

By: Targa Straddle GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA TEXAS FIELD SERVICES LP

By: Targa Resources Texas GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	TARGA VERSADO LP

By: Targa Versado GP LLC,

        Its General Partner

 	 
	 	By:  	/s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

Signature Page to First Supplemental Indenture

 

MIDSTREAM BARGE COMPANY LLC

TARGA CAPITAL LLC

TARGA CO-GENERATION LLC

TARGA DOWNSTREAM GP LLC

TARGA GAS MARKETING LLC

TARGA INTRASTATE PIPELINE LLC

TARGA LIQUIDS GP LLC

TARGA LOUISIANA FIELD SERVICES LLC

TARGA LOUISIANA INTRASTATE LLC

TARGA LSNG GP LLC

TARGA MLP CAPITAL LLC

TARGA NGL PIPELINE COMPANY LLC

TARGA NORTH TEXAS GP LLC

TARGA PERMIAN INTRASTATE LLC

TARGA RESOURCES OPERATING GP LLC

TARGA RESOURCES TEXAS GP LLC

TARGA RETAIL ELECTRIC LLC

TARGA SPARTA LLC

TARGA STRADDLE GP LLC

TARGA TRANSPORT LLC

TARGA VERSADO GP LLC

	 	 	 	 	 
	 	 	 
	 	By:  	                /s/ Jeffrey J. McParland
 	 
	 	 	Name:  	Jeffrey J. McParland 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	/s/ Steven A. Finklea
 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 

Signature Page to First Supplemental IndentureExhibit 10.1

Exhibit 10.1

December 7, 2010

To: «Full_Legal_Name»

We are pleased to notify you that you have been granted the following stock options (the “Options”)
under the Rockwell Automation, Inc. 2008 Long-Term Incentives Plan (the “Plan”):

	 	 	 	 	 	 	 
	Date of Grant	 	Type of Grant	 	Number of Shares	 	Option Price
	12/7/2010
	 	ISO
	 	 	 	$
	12/7/2010
	 	NQ
	 	 	 	$

The Options are granted under and may be exercised only upon the terms and conditions of this Stock
Option Agreement, subject in all respects to the provisions of the Plan, as it may be amended. The
enclosed Stock Option Terms and Conditions are incorporated in and are part of this Stock Option
Agreement. Other terms and conditions are substantially the same as any options previously
granted.

All option holders must activate an account with our stock option administrator, Charles Schwab, in
order to exercise their stock options. There is no cost to open or maintain this account. If you
already have a Schwab account, you need not open another. Please note that if you fail to activate
an account with Schwab, you will experience unnecessary delays in the exercise of your options. If
you have questions regarding your account, please call Charles Schwab’s Customer Service Center at
(877) 804-3529. You can also find account information at http://scs.schwab.com/rockwell.

In partial consideration for the grant of the Options to you, you undertake and agree by your
acceptance of this Stock Option Agreement that

	 	(a)	 	during your employment with the Corporation or a Subsidiary (as such terms are
defined in the Plan) and for two years after the date of your retirement or other
termination of such employment, you shall not (i) directly or indirectly, except with
the approval of the Corporation, engage or otherwise participate in any business that
is competitive with any significant line of business of the Corporation or any of its
Subsidiaries (otherwise than through ownership of not more than 5% of the voting
securities of any such competitive business); or (ii) solicit or induce, or cause any
other person or entity to solicit, any employee of the Corporation or any of its
Subsidiaries to leave his or her employment with the Corporation or any of its
Subsidiaries to accept employment or other engagement with any other person or entity;
and

	 	(b)	 	in the event that you breach this undertaking, in addition to any and all other
remedies the Corporation may have, (i) the Corporation shall have the right to
determine by written notice to you that any of the Options then outstanding shall
immediately lapse and cease to be exercisable; and (ii) you agree to pay the
Corporation upon written demand the amount of the excess of the Fair Market Value (as defined in the Plan) of any shares of Stock (as defined in the Plan) you
acquired upon exercise of any of the Options (other than Options exercised more than
two years before the date of your retirement or other termination of employment)
over the exercise price for such Stock.

 

 

 

If a Change of Control (as defined in the Plan) occurs, however, the foregoing provisions (a) and
(b) shall immediately terminate as of, and shall not limit your activities after, the date of such
Change of Control.

A copy of the Plan Prospectus is enclosed. You can find a copy of the Plan through the Schwab
Equity Award
Center®
on the Web at http://scs.schwab.com/rockwell. Please carefully
read the enclosed documents and retain them for future reference.

The Options will lapse and be of no effect if a copy of this Stock Option Agreement, properly
signed by you, is not received by the Compensation Department at the following address on or before
January 31, 2011, unless Rockwell Automation (in its sole discretion) elects in writing to extend
that date:

Rockwell Automation, Inc.

Mail Stop: W-8S28

Compensation

1201 South Second Street

Milwaukee, WI 53204

	 	 	 	 	 	 	 	 
	Agreed to:	 	 	 	ROCKWELL AUTOMATION, INC.
	Date:
	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 
	 

	 	 	 	 	 	 	By:
	 
	 	 	 	 	 	 	 
	 	 	 	 	 
	Employee Signature	 	 	 	Douglas M. Hagerman
	 

	 	 	 	 	 	 	Senior Vice President,
	Employee ID:	 	 	 	General Counsel and Secretary
	 

	 	 	 

	 	 	 	 

Enclosures

 

2

 

ROCKWELL AUTOMATION, INC.

2008 LONG-TERM INCENTIVES PLAN

STOCK OPTION TERMS AND CONDITIONS

(December 7, 2010)

	1.	 	Definitions

As used in these Stock Option Terms and Conditions, the following words and phrases shall
have the respective meanings ascribed to them below unless the context in which any of them
is used clearly indicates a contrary meaning:

	 	(a)	 	Change of Control: Change of Control shall have the same meaning as
such term has in the Plan.

	 	(b)	 	Charles Schwab: Charles Schwab & Co., Inc., the stock option
administrator whom Rockwell Automation has engaged to administer and process all Option
exercises.

	 	(c)	 	Corporation: Rockwell Automation and its Subsidiaries (as such term is
defined in the Plan).

	 	(d)	 	Customer Service Center: Charles Schwab’s Customer Service Center that
is used to facilitate Option transactions. Contact Charles Schwab at (877) 804-3529.

	 	(e)	 	Exercise Request and Attestation Form: Such form as may be accepted by
Charles Schwab in connection with the use of already-owned shares to pay all or part of
the exercise price for the Option Stock to be purchased on exercise of any of the
Options.

	 	(f)	 	Notice of Exercise Form: The form attached as Exhibit 1 or any other
form accepted by the Secretary of Rockwell Automation in his sole discretion.

	 	(g)	 	Options: The stock option or stock options listed in the first
paragraph of the Stock Option Agreement dated December 7, 2010 to which these Stock
Option Terms and Conditions are attached.

	 	(h)	 	Option Stock: The Stock issuable or transferable on exercise of the
Options.

	 	(i)	 	Plan: Rockwell Automation’s 2008 Long-Term Incentives Plan, as such
Plan may be amended and in effect at the relevant time.

	 	(j)	 	Rockwell Automation: Rockwell Automation, Inc., a Delaware
corporation, and any successor thereto.

	 	(k)	 	Stock: Stock shall have the same meaning as such term has in the Plan.

	 	(l)	 	Stock Option Agreement: These Stock Option Terms and Conditions
together with the Stock Option Agreement dated December 7, 2010 to which they are
attached.

 

3

 

	2.	 	When Options May be Exercised

The Options may be exercised, in whole or in part (but only for a whole number of shares of
Stock) and at one time or from time to time, as to one-third (rounded to the nearest whole
number) of the Option Stock granted as nonqualified stock options (NQs) and incentive stock
options (ISOs) during the period beginning on December 7, 2011 and ending on December 7,
2020, as to an additional one-third (rounded to the nearest whole number) of the Option
Stock granted as NQs and ISOs during the period beginning on December 7, 2012 and ending on
December 7, 2020, and as to the balance of the Option Stock granted as NQs and ISOs during
the period beginning on December 7, 2013 and ending on December 7, 2020, and only during
those periods, provided that:

	 	(a)	 	if you die while an Employee (as defined in the Plan), your estate, or any
person who acquires the Options by bequest or inheritance, may exercise all the Options
not theretofore exercised within (and only within) the period beginning on your date of
death (even if you die before you have become entitled to exercise all or any part of
the Options) and ending three years thereafter; and

	 	(b)	 	if your employment by the Corporation terminates other than by death, then:

	 	(i)	 	if your retirement or other termination date is before December
7, 2011, the Options will terminate on your retirement or other termination and
may not be exercised at any time;

	 	(ii)	 	if your employment by the Corporation is terminated for “cause”
(as reasonably determined by the Corporation applying the definition in this
Agreement), the Options will immediately terminate upon your termination and
may not be exercised at any time;

	 	(iii)	 	if your employment by the Corporation terminates on or after
December 7, 2011 by reason of your retirement under a retirement plan of
Rockwell Automation, or under a retirement plan of a subsidiary or affiliate of
Rockwell Automation, and if you immediately begin either to receive pension
payments under any such retirement plan or to receive retiree medical benefits,
you (or if you die after your retirement date, your estate or any person who
acquires the Options by bequest or inheritance) may thereafter exercise the
Options within (and only within) the period starting on the date you would
otherwise have become entitled to exercise the part of the Options so exercised
and ending on the fifth anniversary of your retirement date; and

	 	(iv)	 	if your employment by the Corporation terminates on or after
December 7, 2011 for any reason not specified in subparagraph (a) or in clauses
(ii) or (iii) of this subparagraph (b), you (or if you die after your
termination date, your estate or any person who acquires the Options by bequest
or inheritance) may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but only to the
extent they were exercisable on your termination date.

 

4

 

For purposes of this Section 2, “cause” means any of the following: (i) your commission of
an act of theft, dishonesty, willful misconduct, breach of fiduciary duty for personal
profit, or falsification of any documents or records of the Corporation; (ii) your material
failure to comply with the Corporation’s code of conduct or other policies; (iii) your
breach of any obligation under any agreement between you and the Corporation; (iv) your
unauthorized use, misappropriation, destruction or diversion of any asset of the Corporation; (v) any
intentional act of yours that is injurious to the Corporation’s reputation, financial
condition or business, or which otherwise is injurious to employees, clients, or suppliers
of the Corporation; (vi) your repeated failure or inability to perform the duties and/or
responsibilities of your position; or (vii) your conviction of, or plea of no contest to,
any felony or criminal act involving fraud, dishonesty, misappropriation or moral turpitude,
or which impairs your ability to perform your duties with the Corporation, as determined by
the Corporation.

For purposes of this Section 2, if you receive severance payments in connection with your
separation from the Corporation, you will be treated as not having terminated your
employment with the Corporation until the last date on which you are entitled to receive
severance payments from the Corporation, at which time your employment by the Corporation
will be deemed terminated.

In no event will the provisions of the foregoing subparagraphs (a) and (b) extend to a date
after December 7, 2020 the period during which the Options may be exercised.

Notwithstanding any other provision of this Agreement, (x) if (A) a Change of Control
occurs, (B) all Options that are outstanding are assumed or substituted with comparable
awards by the successor corporation in such Change of Control or its parent corporation and
(C) within two years of such Change of Control your employment is terminated (1) by reason
of death or disability, (2) by you for a Change of Control Good Reason (as defined in the
Plan) or (3) by the Corporation other than for Cause (as defined in the Plan) or (y) if (A)
a Change of Control occurs and (B) all Options that are outstanding are not assumed or
substituted with comparable awards by the successor corporation in such Change of Control or
its parent corporation, all Options then outstanding (and, in the case of clause (x), any
substituted awards of options) will immediately become vested and fully exercisable, whether
or not then otherwise exercisable in accordance with their terms.

	3.	 	Exercise Procedure

	 	(a)	 	To exercise all or any part of the Options, you (or after your death, your
estate or any person who has acquired the Options by bequest or inheritance) must first
obtain authorization from Rockwell Automation’s Office of the Secretary by submitting a
Notice of Exercise Form to Rockwell Automation’s Office of the Secretary (Attention:
Stock Option Administration; facsimile number (414) 382-4013) or by other means
acceptable to the Secretary of Rockwell Automation, and then contact the stock option
administrator, Charles Schwab, by using the Customer Service Center as follows:

	 	(i)	 	contact the Customer Service Center by calling (877) 804-3529,
Monday through Friday 9 a.m. to 9 p.m., ET, and follow the instructions
provided;

	 	(ii)	 	the Customer Service Center confirms the Option transaction;

	 	(iii)	 	full payment of the exercise price for the Option Stock to be
purchased on exercise of the Options may be made:

	 	•	 	by check (wire) to your Charles Schwab account; or
	 
	 	•	 	in already-owned Stock; or

	 	•	 	in a combination of check (wire) to your Charles Schwab account and
Stock; or

	 	•	 	by authorizing Charles Schwab or a third party approved by Rockwell
Automation to sell the Stock (or a sufficient portion of the Stock)
acquired upon exercise of the Options; and

 

5

 

	 	(iv)	 	in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as Charles Schwab or
the Secretary of Rockwell Automation shall require to establish to their
satisfaction that the person seeking to exercise the Options is entitled to do
so.

	 	(b)	 	An exercise of the whole or any part of the Options shall be effective:

	 	(i)	 	if you elect (or after your death, the person entitled to
exercise the Options elects) to pay the exercise price for the Option Stock
entirely by check (wire), upon

(A) completion of your transaction by using the Customer Service Center and
full payment of the exercise price and withholding taxes (if applicable) are
received by Charles Schwab within three (3) business days following the
exercise; and

(B) receipt of any documents required pursuant to Section 3(a)(iv) herein;
and

	 	(ii)	 	if you elect (or after your death, the person entitled to
exercise the Options elects) to pay the exercise price of the Option Stock in
Stock or in a combination of Stock and check, upon (A) completion of your
transaction by using the Customer Service Center and full payment of the
exercise price (as described in Section 3(d) herein) and withholding taxes (if
applicable) are received by Charles Schwab within three (3) business days
following the exercise; and (B) receipt of any documents required pursuant to
Section 3(a)(iv) herein.

	 	(c)	 	If you choose (or after your death, the person entitled to exercise the Options
chooses) to pay the exercise price for the Option Stock to be purchased on exercise of
any of the Options entirely by check, payment must be made by:

	 	•	 	delivering to Charles Schwab a check (wire) in the full amount of
the exercise price of such Option Stock; or

	 	•	 	arranging with a stockbroker, bank or other financial institution to
deliver to Charles Schwab full payment, by check or (if prior
arrangements are made with Charles Schwab) by wire transfer, of the
exercise price of such Option Stock.

In either event, in accordance with Section 3(e) herein, full payment of the
exercise price for the Option Stock purchased must be made within three (3) business
days after the exercise has been completed through the Customer Service Center.

 

6

 

	 	(d)	(i)	If you choose (or after your death, the person entitled to exercise the
Options chooses) to use already-owned Stock to pay all or part of the exercise price
for the Option Stock to be purchased on exercise of any of the Options, you (or after
your death, the person entitled to exercise the Options) must deliver to Charles Schwab an Exercise Request and Attestation
Form and cash representing one share, per grant exercised, to settle the
rounding of the exercise costs. To perform such a stock swap transaction or
a partial swap transaction, the Exercise Request and Attestation Form must
be submitted via fax (720) 785-8884 by 4 PM ET on the date of exercise. Any
questions concerning a stock swap transaction should be referred to (877)
636-7551 (Stock Option Administration Group Hotline). The Exercise Request
and Attestation Form must attest to your ownership of Stock representing:

	 	•	 	at least the number of shares of Stock whose value, based on the
Fair Market Value (as defined in the Plan) on the day you have
exercised your Options through the Customer Service Center, equals the
exercise price for the Option Stock; or

	 	•	 	any lesser number of shares of Stock you desire (or after your
death, the person entitled to exercise the Options desires) to use to
pay the exercise price for such Option Stock and a check in the amount
of such exercise price less the value of the Stock to which you are
attesting, based on the Fair Market Value on the day you have exercised
your Options through the Customer Service Center.

	 	(ii)	 	If you choose (or after your death, the person entitled to
exercise the Options chooses) to use Stock acquired upon exercise of the
Options to pay all or part of the exercise price for the remaining Option Stock
to be purchased on exercise of any of the Options, you (or after your death,
the person entitled to exercise the Options) must contact the Customer Service
Center at (877) 804-3529.

	 	(iii)	 	Charles Schwab will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number of shares of
Stock, valued in accordance with Section 4(a)(ii) of the Plan at their Fair
Market Value on the date of exercise, and any funds required to pay in full the
exercise price for the Option Stock purchased. In accordance with Section 3(e)
herein, you (or such other person) must pay, by check, in Stock or in a
combination of check and Stock, any balance required to pay in full the
exercise price of the Option Stock purchased within three (3) business days
after the exercise has been completed through the Customer Service Center.

	 	(iv)	 	Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Automation may limit the number, frequency
or volume of successive exercises of any of the Options in which payment is
made, in whole or in part, by delivery of Stock pursuant to this subparagraph
(d) to prevent unreasonable pyramiding of such exercises.

 

7

 

	 	(e)	 	An exercise completed through the Customer Service Center, whether or not full
payment of the exercise price for the Option Stock is received by Charles Schwab, shall
constitute a binding contractual obligation by you (or the other person entitled to
exercise the Options) to proceed with and conclude that exercise of the Options (but
only so long as you continue, or the other person entitled to exercise the Options
continues, to be entitled to exercise the Options on that date). By your acceptance of
this Stock Option Agreement, you agree (for yourself and on behalf of any other person
who becomes entitled to exercise the Options) to deliver or cause to be delivered to Charles Schwab in full the exercise price for the Option
Stock, that payment being by check, wire transfer, in Stock or in a combination of
check and Stock, on or before the third business day after the date on which you
complete the exercise through the Customer Service Center. If such payment is not
made, you (for yourself and on behalf of any other person who becomes entitled to
exercise the Options) authorize the Corporation, in its discretion, to set off
against salary payments or other amounts due or which may become due you (or the
other person entitled to exercise the Options) any balance of the exercise price for
such Option Stock remaining unpaid thereafter.

	 	(f)	 	An Exercise Confirmation representing the number of shares of Option Stock
purchased will be issued the third business day (i) after Charles Schwab has received
full payment therefor or (ii) at Rockwell Automation’s or Charles Schwab’s election in
their sole discretion, after Rockwell Automation or Charles Schwab has received (x)
full payment of the exercise price of the Option Stock and (y) any reimbursement in
respect of withholding taxes due pursuant to Section 5 herein.

	4.	 	Transferability

The Options are not transferable by you otherwise than (i) by will or by the laws of descent
and distribution, or (ii) in the case of Options not granted as incentive stock options, by
gift (A) to any member of your immediate family or (B) to a limited liability corporation or
partnership or trust for the benefit of one or more members of your immediate family or (C)
to a family charitable trust established by you or a member of your immediate family;
provided, however, that no transfer pursuant to this clause (ii) shall be effective unless
you have notified the Corporation’s Office of the Secretary (Attention: Stock Option
Administration) in writing specifying the Option or Options transferred, the date of the
gift and the name, address and social security or other taxpayer identification number of
the transferee. During your lifetime, only you are entitled to exercise the Options unless
you have transferred any Option in accordance with this paragraph to a member of your
immediate family or to a limited liability corporation or partnership or trust for the
benefit of one or more members of your immediate family or to a family charitable trust
established by you or a member of your immediate family, in which case only that transferee
(or the legal representative of the estate or the heirs or legatees of that transferee)
shall be entitled to exercise that Option. For purposes of this paragraph, your “immediate
family” shall mean your spouse and natural, adopted or step-children and grandchildren.

	5.	 	Withholding

Rockwell Automation, your employer and Charles Schwab shall have the right, in connection
with the exercise of the Options in whole or in part, to deduct from any payment to be made
by Rockwell Automation or Charles Schwab under the Plan an amount equal to the taxes
required to be withheld by law with respect to such exercise or to require you (or any other
person entitled to exercise the Options) to pay to it an amount sufficient to provide for
any such taxes so required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who becomes entitled to
exercise the Options) that if Rockwell Automation or Charles Schwab elects to require you
(or such other person) to remit an amount sufficient to pay such withholding taxes, you (or
such other person) must remit that amount within three (3) business days after the
completion of the Option exercise. If such payment is not made, Rockwell Automation, in its
discretion, shall have the same right of set-off with respect to payment of the withholding taxes in connection with the exercise of the Option as provided under
Section 3(e) herein with respect to payment of the exercise price.

 

8

 

	6.	 	Headings

The section headings contained in these Stock Option Terms and Conditions are solely for the
purpose of reference, are not part of the agreement of the parties and shall in no way
affect the meaning or interpretation of this Stock Option Agreement.

	7.	 	References

All references in these Stock Option Terms and Conditions to Sections, paragraphs,
subparagraphs or clauses shall be deemed to be references to Sections, paragraphs,
subparagraphs and clauses of these Stock Option Terms and Conditions unless otherwise
specifically provided.

	8.	 	Entire Agreement

This Stock Option Agreement and the Plan embody the entire agreement and understanding
between Rockwell Automation and you with respect to the Options, and there are no
representations, promises, covenants, agreements or understandings with respect to the
Options other than those expressly set forth in this Stock Option Agreement and the Plan.

	9.	 	Applicable Laws and Regulations

This Stock Option Agreement and Rockwell Automation’s obligation to issue Option Stock
hereunder are subject to applicable laws and regulations, as well as Rockwell Automation’s
insider trading policies.

Exhibit 1 Notice of Exercise Form

 

9

 

NOTICE OF EXERCISE FORM

FOR OFFICERS

			
	To:	 	Rockwell Automation, Inc.

Office of the Secretary

1201 South Second Street

E-7F19

Milwaukee, WI 53204

Fax No. (414) 382-8487

1. OPTIONS EXERCISED: Subject to the terms and conditions of the Stock Option
Agreement dated December 7, 2010, with Rockwell Automation, Inc. (Rockwell Automation), I hereby
exercise the following stock option(s) granted thereunder:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Date of Grant	 	Number of Shares	 	 	Exercise Price	 	 	Total Purchase Price	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 

2. PAYMENT: The following must be received by Charles Schwab & Co., Inc. (Charles
Schwab) within three business days following the date of exercise:

	 	•	 	A check payable to the Rockwell Automation Employee Stock Option Program or a wire
transfer to Charles Schwab for credit to the Rockwell Automation Employee Stock Option
Program in the amount of the Total Purchase Price of the above-itemized stock option(s); or

	 	•	 	A number of shares of Rockwell Automation Common Stock surrendered or sold to pay the
Total Purchase Price of the above-itemized stock option(s); or

	 	•	 	A combination of (i) a check payable to the Rockwell Automation Employee Stock Option
Program or a wire transfer to Charles Schwab for credit to the Rockwell Automation Employee
Stock Option Program, and (ii) a number of Shares surrendered or sold; which together amount
to the Total Purchase Price of the above-itemized stock option(s).

If full payment of the Total Purchase Price of the stock option(s) listed in Item 1
is not delivered within three (3) business days after the exercise date, Rockwell Automation is
authorized forthwith to set off the balance due against any amounts due or which may become due me
to satisfy my obligation to pay the Total Purchase Price.

This Stock Option Exercise may not be revoked or changed after delivery of this form, properly
completed, dated and signed, to Rockwell Automation whether or not payment accompanies this form
and whether this form is dated before, on or after the date of such receipt.

	 	 	 	 	 
	 	Signature
 	 	 	 
	 
	 	Print Name 	 	 	 
	 
	 	Date 	 	 	 

 

10

 

	 	 	 	 	 

ROCKWELL AUTOMATION, INC.

2008 LONG-TERM INCENTIVES PLAN

STOCK OPTION TERMS AND CONDITIONS

(December 7, 2010)

	10.	 	Definitions

As used in these Stock Option Terms and Conditions, the following words and phrases shall
have the respective meanings ascribed to them below unless the context in which any of them
is used clearly indicates a contrary meaning:

	 	(a)	 	Change of Control: Change of Control shall have the same meaning as
such term has in the Plan.

	 	(b)	 	Charles Schwab: Charles Schwab & Co., Inc., the stock option
administrator whom Rockwell Automation has engaged to administer and process all Option
exercises.

	 	(c)	 	Corporation: Rockwell Automation and its Subsidiaries (as such term is
defined in the Plan).

	 	(d)	 	Customer Service Center: Charles Schwab’s Customer Service Center that
is used to facilitate Option transactions. Contact Charles Schwab at (877) 804-3529.

	 	(e)	 	Exercise Request and Attestation Form: Such form as may be accepted by
Charles Schwab in connection with the use of already-owned shares to pay all or part of
the exercise price for the Option Stock to be purchased on exercise of any of the
Options.

	 	(f)	 	Notice of Exercise Form: The form attached as Exhibit 1 or any other
form accepted by the Secretary of Rockwell Automation in his sole discretion.

	 	(g)	 	Options: The stock option or stock options listed in the first
paragraph of the Stock Option Agreement dated December 7, 2010 to which these Stock
Option Terms and Conditions are attached and which together with these Stock Option
Terms and Conditions constitute the Stock Option Agreement.

	 	(h)	 	Option Stock: The Stock issuable or transferable on exercise of the
Options.

	 	(i)	 	Plan: Rockwell Automation’s 2008 Long-Term Incentives Plan, as such
Plan may be amended and in effect at the relevant time.

	 	(j)	 	Rockwell Automation: Rockwell Automation, Inc., a Delaware
corporation, and any successor thereto.

	 	(k)	 	Stock: Stock shall have the same meaning as such term has in the Plan.

	 	(l)	 	Stock Option Agreement: These Stock Option Terms and Conditions
together with the Stock Option Agreement dated December 7, 2010 to which they are
attached.

 

11

 

	11.	 	When Options May be Exercised

The Options may be exercised, in whole or in part (but only for a whole number of shares of
Stock) and at one time or from time to time, as to one-third (rounded to the nearest whole
number) of the Option Stock granted as nonqualified stock options (NQs) and incentive stock
options (ISOs) during the period beginning on December 7, 2011 and ending on December 7,
2020, as to an additional one-third (rounded to the nearest whole number) of the Option
Stock granted as NQs and ISOs during the period beginning on December 7, 2012 and ending on
December 7, 2020, and as to the balance of the Option Stock granted as NQs and ISOs during
the period beginning on December 7, 2013 and ending on December 7, 2020, and only during
those periods, provided that:

	 	(a)	 	if you die while an Employee (as defined in the Plan), your estate, or any
person who acquires the Options by bequest or inheritance, may exercise all the Options
not theretofore exercised within (and only within) the period beginning on your date of
death (even if you die before you have become entitled to exercise all or any part of
the Options) and ending three years thereafter; and

	 	(b)	 	if your employment by the Corporation terminates other than by death, then:

	 	(i)	 	if your retirement or other termination date is before December
7, 2011, the Options will terminate on your retirement or other termination and
may not be exercised at any time;

	 	(ii)	 	if your employment by the Corporation is terminated for “cause”
(as reasonably determined by the Corporation applying the definition in this
Agreement), the Options will immediately terminate upon your termination and
may not be exercised at any time;

	 	(iii)	 	if your employment by the Corporation terminates on or after
December 7, 2011 by reason of your retirement under a retirement plan of
Rockwell Automation, or under a retirement plan of a subsidiary or affiliate of
Rockwell Automation, and if you immediately begin either to receive pension
payments under any such retirement plan or to receive retiree medical benefits,
you (or if you die after your retirement date, your estate or any person who
acquires the Options by bequest or inheritance) may thereafter exercise the
Options within (and only within) the period starting on the date you would
otherwise have become entitled to exercise the part of the Options so exercised
and ending on the fifth anniversary of your retirement date; and

	 	(iv)	 	if your employment by the Corporation terminates on or after
December 7, 2011 for any reason not specified in subparagraph (a) or in clauses
(ii) or (iii) of this subparagraph (b), you (or if you die after your
termination date, your estate or any person who acquires the Options by bequest
or inheritance) may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but only to the
extent they were exercisable on your termination date.

 

12

 

For purposes of this Section 2, “cause” means any of the following: (i) your commission of
an act of theft, dishonesty, willful misconduct, breach of fiduciary duty for personal
profit, or falsification of any documents or records of the Corporation; (ii) your material
failure to comply with the Corporation’s code of conduct or other policies; (iii) your
breach of any obligation under any agreement between you and the Corporation; (iv) your unauthorized use,
misappropriation, destruction or diversion of any asset of the Corporation; (v) any
intentional act of yours that is injurious to the Corporation’s reputation, financial
condition or business, or which otherwise is injurious to employees, clients, or suppliers
of the Corporation; (vi) your repeated failure or inability to perform the duties and/or
responsibilities of your position; or (vii) your conviction of, or plea of no contest to,
any felony or criminal act involving fraud, dishonesty, misappropriation or moral turpitude,
or which impairs your ability to perform your duties with the Corporation, as determined by
the Corporation.

For purposes of this Section 2, if you receive severance payments in connection with your
separation from the Corporation, you will be treated as not having terminated your
employment with the Corporation until the last date on which you are entitled to receive
severance payments from the Corporation, at which time your employment by the Corporation
will be deemed terminated.

In no event will the provisions of the foregoing subparagraphs (a) and (b) extend to a date
after December 7, 2020 the period during which the Options may be exercised.

Notwithstanding any other provision of this Agreement, (x) if (A) a Change of Control
occurs, (B) all Options that are outstanding are assumed or substituted with comparable
awards by the successor corporation in such Change of Control or its parent corporation and
(C) within two years of such Change of Control your employment is terminated (1) by reason
of death or disability, (2) by you for a Change of Control Good Reason (as defined in the
Plan) or (3) by the Corporation other than for Cause (as defined in the Plan) or (y) if (A)
a Change of Control occurs and (B) all Options that are outstanding are not assumed or
substituted with comparable awards by the successor corporation in such Change of Control or
its parent corporation, all Options then outstanding (and, in the case of clause (x), any
substituted awards of options) will immediately become vested and fully exercisable, whether
or not then otherwise exercisable in accordance with their terms.

	12.	 	Exercise Procedure

	 	(a)	 	To exercise all or any part of the Options, you (or after your death, your
estate or any person who has acquired the Options by bequest or inheritance) must first
obtain authorization from Rockwell Automation’s Office of the Secretary by submitting a
Notice of Exercise Form to Rockwell Automation’s Office of the Secretary (Attention:
Stock Option Administration; facsimile number (414) 382-4013) or by other means
acceptable to the Secretary of Rockwell Automation, and then contact the stock option
administrator, Charles Schwab, by using the Customer Service Center as follows:

	 	(i)	 	contact the Customer Service Center by calling (877) 804-3529,
Monday through Friday 9 a.m. to 9 p.m., ET, and follow the instructions
provided;

	 	(ii)	 	the Customer Service Center confirms the Option transaction;

	 	(iii)	 	full payment of the exercise price for the Option Stock to be
purchased on exercise of the Options may be made:

	 	•	 	by check (wire) to your Charles Schwab account; or

	 	•	 	in already-owned Stock; or

 

13

 

	 	•	 	in a combination of check (wire) to your Charles Schwab account and
Stock; or

	 	•	 	by authorizing Charles Schwab or a third party approved by Rockwell
Automation to sell the Stock (or a sufficient portion of the Stock)
acquired upon exercise of the Options; and

	 	(iv)	 	in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as Charles Schwab or
the Secretary of Rockwell Automation shall require to establish to their
satisfaction that the person seeking to exercise the Options is entitled to do
so.

	 	(b)	 	An exercise of the whole or any part of the Options shall be effective:

	 	(i)	 	if you elect (or after your death, the person entitled to
exercise the Options elects) to pay the exercise price for the Option Stock
entirely by check (wire), upon (A) completion of your transaction by using the
Customer Service Center and full payment of the exercise price and withholding
taxes (if applicable) are received by Charles Schwab within three (3) business
days following the exercise; and (B) receipt of any documents required pursuant
to Section 3(a)(iv) herein; and

	 	(ii)	 	if you elect (or after your death, the person entitled to
exercise the Options elects) to pay the exercise price of the Option Stock in
Stock or in a combination of Stock and check, upon (A) completion of your
transaction by using the Customer Service Center and full payment of the
exercise price (as described in Section 3(d) herein) and withholding taxes (if
applicable) are received by Charles Schwab within three (3) business days
following the exercise; and (B) receipt of any documents required pursuant to
Section 3(a)(iv) herein.

	 	(c)	 	If you choose (or after your death, the person entitled to exercise the Options
chooses) to pay the exercise price for the Option Stock to be purchased on exercise of
any of the Options entirely by check, payment must be made by:

	 	•	 	delivering to Charles Schwab a check (wire) in the full amount of
the exercise price of such Option Stock; or

	 	•	 	arranging with a stockbroker, bank or other financial institution to
deliver to Charles Schwab full payment, by check or (if prior
arrangements are made with Charles Schwab) by wire transfer, of the
exercise price of such Option Stock.

In either event, in accordance with Section 3(e) herein, full payment of the
exercise price for the Option Stock purchased must be made within three (3) business
days after the exercise has been completed through the Customer Service Center.

 

14

 

	 	(d)	(i)	If you choose (or after your death, the person entitled to exercise the
Options chooses) to use already-owned Stock to pay all or part of the exercise price
for the Option Stock to be purchased on exercise of any of the Options, you (or after
your death, the person entitled to exercise the Options) must deliver to Charles Schwab an Exercise Request and Attestation
Form and cash representing one share, per grant exercised, to settle the
rounding of the exercise costs. To perform such a stock swap transaction or
a partial swap transaction, the Exercise Request and Attestation Form must
be submitted via fax (720) 785-8884 by 4 PM ET on the date of exercise. Any
questions concerning a stock swap transaction should be referred to (877)
636-7551 (Stock Option Administration Group Hotline). The Exercise Request
and Attestation Form must attest to your ownership of Stock representing:

	 	•	 	at least the number of shares of Stock whose value, based on the
Fair Market Value (as defined in the Plan) on the day you have
exercised your Options through the Customer Service Center, equals the
exercise price for the Option Stock; or

	 	•	 	any lesser number of shares of Stock you desire (or after your
death, the person entitled to exercise the Options desires) to use to
pay the exercise price for such Option Stock and a check in the amount
of such exercise price less the value of the Stock to which you are
attesting, based on the Fair Market Value on the day you have exercised
your Options through the Customer Service Center.

	 	(ii)	 	If you choose (or after your death, the person entitled to
exercise the Options chooses) to use Stock acquired upon exercise of the
Options to pay all or part of the exercise price for the remaining Option Stock
to be purchased on exercise of any of the Options, you (or after your death,
the person entitled to exercise the Options) must contact the Customer Service
Center at (877) 804-3529.

	 	(v)	 	Charles Schwab will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number of shares of
Stock, valued in accordance with Section 4(a)(ii) of the Plan at their Fair
Market Value on the date of exercise, and any funds required to pay in full the
exercise price for the Option Stock purchased. In accordance with Section 3(e)
herein, you (or such other person) must pay, by check, in Stock or in a
combination of check and Stock, any balance required to pay in full the
exercise price of the Option Stock purchased within three (3) business days
after the exercise has been completed through the Customer Service Center.

	 	(vi)	 	Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Automation may limit the number, frequency
or volume of successive exercises of any of the Options in which payment is
made, in whole or in part, by delivery of Stock pursuant to this subparagraph
(d) to prevent unreasonable pyramiding of such exercises.

	 	(e)	 	An exercise completed through the Customer Service Center, whether or not full
payment of the exercise price for the Option Stock is received by Charles Schwab, shall
constitute a binding contractual obligation by you (or the other person entitled to
exercise the Options) to proceed with and conclude that exercise of the Options (but
only so long as you continue, or the other person entitled to exercise the Options
continues, to be entitled to exercise the Options on that date). By your acceptance of
this Stock Option Agreement, you agree (for yourself and on behalf of any other person
who becomes entitled to exercise the Options) to deliver or cause to be 

 

15

 

delivered to Charles Schwab in full the exercise price for the Option
Stock, that payment being by check, wire transfer, in Stock or in a combination of
check and Stock, on or before the third business day after the date on which you
complete the exercise through the Customer Service Center. If such payment is not
made, you (for yourself and on behalf of any other person who becomes entitled to
exercise the Options) authorize the Corporation, in its discretion, to set off
against salary payments or other amounts due or which may become due you (or the
other person entitled to exercise the Options) any balance of the exercise price for
such Option Stock remaining unpaid thereafter.

	 	(f)	 	An Exercise Confirmation representing the number of shares of Option Stock
purchased will be issued the third business day (i) after Charles Schwab has received
full payment therefor or (ii) at Rockwell Automation’s or Charles Schwab’s election in
their sole discretion, after Rockwell Automation or Charles Schwab has received (x)
full payment of the exercise price of the Option Stock and (y) any reimbursement in
respect of withholding taxes due pursuant to Section 5 herein.

	13.	 	Transferability

The Options are not transferable by you otherwise than by will or by the laws of descent and
distribution. During your lifetime, only you are entitled to exercise the Options.

	14.	 	Withholding

Rockwell Automation, your employer and Charles Schwab shall have the right, in connection
with the exercise of the Options in whole or in part, to deduct from any payment to be made
by Rockwell Automation or Charles Schwab under the Plan an amount equal to the taxes
required to be withheld by law with respect to such exercise or to require you (or any other
person entitled to exercise the Options) to pay to it an amount sufficient to provide for
any such taxes so required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who becomes entitled to
exercise the Options) that if Rockwell Automation or Charles Schwab elects to require you
(or such other person) to remit an amount sufficient to pay such withholding taxes, you (or
such other person) must remit that amount within three (3) business days after the
completion of the Option exercise. If such payment is not made, Rockwell Automation, in its
discretion, shall have the same right of set-off with respect to payment of the withholding
taxes in connection with the exercise of the Option as provided under Section 3(e) herein
with respect to payment of the exercise price.

	15.	 	Headings

The section headings contained in these Stock Option Terms and Conditions are solely for the
purpose of reference, are not part of the agreement of the parties and shall in no way
affect the meaning or interpretation of this Stock Option Agreement.

	16.	 	References

All references in these Stock Option Terms and Conditions to Sections, paragraphs,
subparagraphs or clauses shall be deemed to be references to Sections, paragraphs,
subparagraphs and clauses of these Stock Option Terms and Conditions unless otherwise
specifically provided.

 

16

 

	17.	 	Entire Agreement

This Stock Option Agreement and the Plan embody the entire agreement and understanding
between Rockwell Automation and you with respect to the Options, and there are no
representations, promises, covenants, agreements or understandings with respect to the
Options other than those expressly set forth in this Stock Option Agreement and the Plan.

	18.	 	Applicable Laws and Regulations

This Stock Option Agreement and Rockwell Automation’s obligation to issue Option Stock
hereunder are subject to applicable laws and regulations, as well as Rockwell Automation’s
insider trading policies.

Exhibit 1 Notice of Exercise Form

 

17

 

NOTICE OF EXERCISE FORM

FOR OFFICERS

			
	To:	 	Rockwell Automation, Inc.

Office of the Secretary

1201 South Second Street

E-7F19

Milwaukee, WI 53204

Fax No. (414) 382-8487

1. OPTIONS EXERCISED: Subject to the terms and conditions of the Stock Option
Agreement dated December 7, 2010, with Rockwell Automation, Inc. (Rockwell Automation), I hereby
exercise the following stock option(s) granted thereunder:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Date of Grant	 	Number of Shares	 	 	Exercise Price	 	 	Total Purchase Price	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 
	 
	 	 	 	 	 	$	                    	 	 	$	                             	 

2. PAYMENT: The following must be received by Charles Schwab & Co. Inc. (Charles
Schwab) within three business days following the date of exercise:

	 	•	 	A check payable to the Rockwell Automation Employee Stock Option Program or a wire
transfer to Charles Schwab for credit to the Rockwell Automation Employee Stock Option
Program in the amount of the Total Purchase Price of the above-itemized stock option(s); or

	 	•	 	A number of shares of Rockwell Automation Common Stock surrendered or sold to pay the
Total Purchase Price of the above-itemized stock option(s); or

	 	•	 	A combination of (i) a check payable to the Rockwell Automation Employee Stock Option
Program or a wire transfer to Charles Schwab for credit to the Rockwell Automation Employee
Stock Option Program, and (ii) a number of Shares surrendered or sold; which together amount
to the Total Purchase Price of the above-itemized stock option(s).

If full payment of the Total Purchase Price of the stock option(s) listed in Item 1
is not delivered within three (3) business days after the exercise date, Rockwell Automation is
authorized forthwith to set off the balance due against any amounts due or which may become due me
to satisfy my obligation to pay the Total Purchase Price.

This Stock Option Exercise may not be revoked or changed after delivery of this form, properly
completed, dated and signed, to Rockwell Automation whether or not payment accompanies this form
and whether this form is dated before, on or after the date of such receipt.

	 	 	 	 	 
	 	Signature
 	 	 	 
	 
	 	Print Name 	 	 	 
	 
	 	Date 	 	 	 

 

18

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