Document:

exv10w34

Exhibit 10.34

EXECUTION COPY

EMPLOYMENT AGREEMENT

     THIS AGREEMENT is made effective as of December 11, 2007, by and among Pregis Holding I
Corporation, a Delaware Corporation (“Pregis I”), and its wholly owned subsidiaries, Pregis Holding
II Corporation, a Delaware corporation (“Pregis II”), and Pregis Corporation, a Delaware
corporation (“Pregis”) (Pregis I, Pregis II and Pregis, collectively, the “Employers” and
individually an “Employer”), and Kevin J. Baudhuin (“Executive”).

RECITALS

     WHEREAS, Executive desires to be employed by Employers; and

     WHEREAS, Employers desire to employ the Executive and to utilize his management services as
indicated herein, and Executive has agreed to provide such management services to Employers; and

     WHEREAS, as a condition precedent and a material inducement for Employers to employ and pay
Executive, Executive has agreed to execute this Agreement and the Noncompetition Agreement, dated
as of December 11, 2007, between Pregis I and Executive (the “Noncompetition Agreement”), and be
bound by the provisions herein and therein.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto
agree as follows:

PROVISIONS

     1. Term and Duties. Employers hereby agree to employ Executive as
President-Protective Packaging North America, commencing on December 11, 2007 (the “Start Date”)
and continuing for a period of three (3) years (the “Initial Term”) or until terminated in
accordance with this Section 1 or Section 4. Unless terminated by either Executive or Employers by
written notice delivered at least thirty (30) days prior to the expiration of the Initial Term,
Executive’s employment shall continue for successive one (1) year terms (each one (1) year term
hereinafter referred to as a “Subsequent Term” and, together with the Initial Term, the “Term”)
until terminated by written notice delivered at least thirty (30) days prior to the expiration of
the Subsequent Term. Subject to the provisions of this Agreement, during the Term, Executive shall
devote his best efforts and abilities to the performance of Executive’s duties on behalf of
Employers, and to the promotion of their interests consistent with and subject to the direction and
control of the Board of Directors of each Employer (the “Board”). Executive shall devote
substantially all of his business time, energies, attention and abilities to the operation of

 

 

the business of Employers and shall not be actively involved in any other trade or business or
as an employee of any other trade or business.

     2. Compensation During Term.

          (a) Base Compensation. In consideration of the services to be rendered by Executive
during the Term, Employers shall pay to Executive as base salary $325,000 per year (“Base
Compensation”), payable bi-weekly and prorated for any partial employment period.

          (b) Bonus. Subject to the limitations set forth in this Agreement, Executive shall be
entitled to receive an annual incentive bonus (the “Incentive Bonus”) based upon the achievement of
one or more performance goals as determined by the Board in its sole discretion. The amount of the
Incentive Bonus shall be determined in the manner set forth on Schedule A attached hereto.

     3. Benefits.

          (a) Executive shall be eligible to participate in such benefit programs offered by each
Employer (other than bonus plans), such as health, dental, life insurance, vision, vacations and
pension, as are offered to similarly-situated employees (except in the case of equity-based
incentive plans where awards are subject to Board (or committee thereof) approval) and in each case
no more favorable than the terms of benefits generally available to the employees of Employers
(based on seniority and salary level), subject in each case to the generally applicable terms and
conditions of the plan, benefit or program in question.

          (b) Employers shall reimburse Executive for all reasonable expenses incurred by him in the
course of performing his duties under this Agreement which are consistent with the Employers’
policies in effect from time to time with respect to travel, entertainment and other business
expenses, subject to the Employers’ requirements with respect to reporting, documentation and
approval of such expenses.

          (c) Employers shall reimburse the Executive for the following reasonable expenses that the
Executive incurs in relocating his primary residence to the Chicago, Illinois metropolitan area:
(a) the cost of any temporary housing in the Chicago, Illinois metropolitan area for 6 months, not
to exceed $5,000 per month; (b) transportation of belongings; (c) two house-hunting trips; (d)
broker and other fees related to sale/acquisition of primary residence; (e) set-up costs of
telephone, cable and broadband; and (f) airfare and lodging for family related to such relocation
and house-hunting trips.

     4. Termination. Executive’s employment shall terminate upon the first to occur of the
following (each, a “Termination Date”):

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          (a) The expiration of the Term;

          (b) Executive’s death or disability (mentally, physically or emotionally), so that Executive
cannot substantially perform his duties hereunder for a period of ninety (90) consecutive days or
for one hundred eighty (180) days during any 365 day period during the Term;

          (c) Executive’s voluntary termination of his employment for any reason, upon not less than ten
(10) business days’ written notice to Employers; or

          (d) Employers’ termination of Executive’s employment for Cause (as hereinafter defined).

     5. Termination Payments.

          (a) Except as otherwise provided herein, if Executive’s employment is terminated pursuant to
Section 1 by thirty (30) days’ prior written notice or pursuant to Section 4, Executive’s Base
Compensation and other benefits, if any, shall terminate at the end of the month during which such
termination occurs.

          (b) Upon termination of Executive’s employment without Cause, Employers shall be obligated, in
lieu of any other remedies available to Executive, to pay Executive (A) an amount equal to his then
current Base Compensation (the “Termination Payment”); (B) (i) if the Termination Date occurs
during the months of January-June of the fiscal year, a pro rata Incentive Bonus for the fiscal
year in which the termination occurs (the “Target Pro Rata Incentive Payment”), based on
Executive’s target Incentive Bonus for such fiscal year; or (ii) if the Termination Date occurs
during the months of July-December of the fiscal year, a pro rata Incentive Bonus for the fiscal
year in which the termination occurs (the “Actual Pro Rata Incentive Payment”), based on Employers’
actual performance through the end of such fiscal year; and (C) all accrued but unpaid amounts
payable to Executive under this Agreement and under any employee benefit plan (the “Accrued
Payment”). The Target Pro Rata Incentive Payment and the Actual Pro Rata Incentive Payment shall,
in each case, be determined based on the number of days elapsed from the beginning of the fiscal
year in which the termination occurs through and including the Termination Date. For purposes of
clarity, Executive will be eligible to receive only one Termination Payment, one Accrued Payment
and either one Target Pro Rata Incentive Payment or one Actual Pro Rata Incentive Payment
(depending on when the Termination Date occurs) from Employers under this Section 5(b). Employers’
obligation to make the Termination Payment and either the Target Pro Rata Incentive Payment or
Actual Pro Rata Incentive Payment shall be conditioned upon: (i) Executive’s continued compliance
with his obligations under the Noncompetition Agreement; and (ii) Executive’s execution, delivery
and non-revocation of a valid and enforceable general release of claims in a form reasonably
acceptable to Employers (the “Release”). In the event that Executive breaches any of the covenants
set forth in the

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Noncompetition Agreement, Executive shall immediately return to Employers any portion of the
Termination Payment and either the Target Pro Rata Incentive Payment or Actual Pro Rata Incentive
Payment that have been paid to Executive pursuant to this Section 5(b). Subject to this Section
5(b) and Section 5(e), the Termination Payment and the Target Pro Rata Incentive Payment, if
applicable, shall be paid in installments on Employers’ regular payroll dates occurring during the
twelve (12) month period immediately following the effectiveness of the Release. Subject to
Section 5(e), the Actual Pro Rata Incentive Payment, if applicable, shall be paid at the time
Employers ordinarily pay incentive bonuses to its executives with respect to the fiscal year in
which the termination occurs. Subject to Section 5(e), the Accrued Payment shall be paid within
thirty (30) days following the Termination Date.

          (c) In the event of a termination of Executive’s employment pursuant to Section 4(b) as a
result of his death or disability, Employers shall pay to Executive, his estate or legal
representative, as the case may be, all amounts accrued to the date of termination and payable to
Executive hereunder and under any other bonus, incentive or other plan.

          (d) Any termination of the Term shall not adversely affect or alter Executive’s rights under
any employee benefit plan of any Employer in which Executive, at the date of termination, has a
vested interest, unless otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto.

          (e) If Executive is a “specified employee” for purposes of Section 409A of the Internal
Revenue Code of 1986, as amended, any payments required to be made pursuant to this Section 5 which
are subject to Section 409A shall not commence until six months from the Termination Date, with the
first payment to be equal to the aggregate amount that would have been paid to Executive under
Section 5 during the first six months immediately following the Termination Date had this Section
5(e) not been applicable.

     6. Definitions. “Cause” as used herein shall mean Executive’s: (i) commission of an
act which constitutes common law fraud, embezzlement (other than occasional, customary and de
minimis use of Employers’ property for personal purposes) or a felony, an act of moral turpitude,
or of any tortious or unlawful act causing material harm to any Employer’s business, standing or
reputation; (ii) gross negligence on the part of Executive in the performance of his duties
hereunder; (iii) breach of his duty of loyalty or care to any Employer; (iv) other misconduct that
is materially detrimental to any Employer; (v) ongoing refusal or failure to perform Executive’s
duties or the deliberate and consistent refusal to conform to or follow any reasonable policy
adopted by the Board, in each case after receiving written notice describing his noncompliance and
being given a five (5) business days opportunity to cure (to the extent curable) such
non-compliance; or (vi) material breach by Executive of this Agreement, the Noncompetition
Agreement or any other agreement with or for the benefit of Employers to which

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Executive is a party or by which Executive is bound, which is not cured (to the extent
curable) within five (5) business days following written notice from Employers.

     7. Consideration. Executive acknowledges and agrees that the consideration set forth
in the recitals to this Agreement and the rights and benefits hereunder are all and singularly
valuable consideration which are sufficient for any or all of Executive’s covenants set forth
herein or in the Noncompetition Agreement.

     8. No Prior Agreements. Executive represents and warrants that his performance of all
the terms of this Agreement does not and shall not breach any fiduciary or other duty or any
covenant, agreement or understanding (including, without limitation, any agreement relating to any
proprietary information, knowledge or data acquired in confidence, trust or otherwise) to which he
is a party or by the terms of which he may be bound. Executive further covenants and agrees not to
enter into any agreement or understanding, either written or oral, in conflict with the provisions
of this Agreement.

     9. Miscellaneous.

          (a) Notices. All notices, requests, consents and demands by the parties hereto shall
be delivered by hand, by confirmed facsimile transmission, by recognized national overnight courier
service or by deposit in the United States mail, postage prepaid, by registered or certified mail,
return receipt requested, addressed to the party to be notified at the addresses set forth below:

if to Executive:

Kevin J. Baudhuin

564 Highland Avenue

Westfield, NJ 07090

if to Employers:

c/o AEA Investors LLC

Park Avenue Tower

65 East 55th Street

New York, NY 10022

Attn: Sanford Krieger

with copy to:

Fried, Frank, Harris, Shriver & Jacobson LLP

One New York Plaza

New York, NY 10004-1980

Attn: Christopher Ewan

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Notices shall be effective immediately upon personal delivery or facsimile transmission, one (1)
business day after deposit with an overnight courier service or three (3) business days after the
date of mailing thereof. Other notices shall be deemed given on the date of receipt. Any party
hereto may change the address specified herein by written notice to the other parties hereto.

     10. Entire Agreement. This Agreement cancels and supersedes any and all prior
agreements and understandings between the parties hereto with respect to the obligations of
Executive, whether oral or written. Executive hereby agrees that, as of the date hereof, this
Agreement shall take effect and no further obligations of any kind whatsoever shall be owed by
Employers. This Agreement constitutes the entire agreement between the parties with respect to the
matters herein provided, and no modifications or waiver of any provision hereof shall be effective
unless in writing and signed by each Employer and Executive.

     11. Binding Effect. All of the terms and provisions of this Agreement shall be
binding upon the parties hereto and its or his heirs, executors, administrators, legal
representatives, successors and assigns, and inure to the benefit of and be enforceable by each
Employer and its successors and assigns, except that the duties and responsibilities of Executive
hereunder are of a personal nature and shall not be assignable or delegable in whole or in part.

     12. Severability. In the event that any provision of this Agreement or application
thereof to anyone or under any circumstance is found to be invalid or unenforceable in any
jurisdiction to any extent for any reason, such invalidity or unenforceability shall not affect any
other provision or application of this Agreement which can be given effect without the invalid or
unenforceable provision or application and shall not invalidate or render unenforceable such
provision or application in any other jurisdiction.

     13. Remedies; Waiver. No remedy conferred upon any Employer by this Agreement is
intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative
and shall be in addition to any other remedy given hereunder or now or hereafter existing at law or
in equity. No delay or omission by any Employer in exercising any right, remedy or power hereunder
or existing at law or in equity shall be construed as a waiver thereof, and any such right, remedy
or power may be exercised by the party possessing the same from time to time and as often as may be
deemed expedient or necessary by such party in its sole discretion.

     14. Counterparts. This Agreement may be executed in several counterparts, each of
which is an original and all of which shall constitute one instrument. It shall not

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be necessary in making proof of this Agreement or any counterpart hereof to produce or account
for any of the other counterparts.

     15. Governing Law. The validity, interpretation, construction, performance and
enforcement of this Agreement shall be governed by the laws of the State of New York, without
application of conflict of laws principles.

     16. Headings. The captions and headings contained in this Agreement are for
convenience only and shall not be construed as a part of the Agreement.

542676

[signature page follows]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above
written.

	 	 	 	 	 
	 	EMPLOYERS:

PREGIS HOLDING I CORPORATION

 	 
	 	By:  	/s/ Michael T. McDonnell	 
	 	 	Name:  	Michael T. McDonnell	 
	 	 	Title:  	CEO	 
	 
	 	PREGIS HOLDING II CORPORATION

 	 
	 	By:  	/s/ Michael T. McDonnell	 
	 	 	Name:  	Michael T. McDonnell	 
	 	 	Title:  	CEO	 
	 
	 	PREGIS CORPORATION

 	 
	 	By:  	/s/ Michael T. McDonnell 	 
	 	 	Name:  	Michael T. McDonnell	 
	 	 	Title:  	CEO	 

	 	 	 	 	 
	 	EXECUTIVE:

 	 
	 	/s/ Kevin J. Baudhuin 	 
	 	Name:  	Kevin J. Baudhuinexv4w3

EXHIBIT 4.3

ILLINOIS TOOL WORKS INC.

Officers’ Certificate Pursuant to

Sections 2.01 and 2.04 of the Indenture

     Ronald D. Kropp, Senior Vice President and Chief Financial Officer, and Felix L. Rodriguez,
Jr., Vice President and Treasurer, of Illinois Tool Works Inc., a Delaware corporation (the
“Company”), each certify, pursuant to Sections 2.01 and 2.04 of the Indenture dated as of November
1, 1986, as supplemented by the First Supplemental Indenture dated as of May 1, 1990 (the
“Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as successor
Trustee, that, pursuant to authority granted by the Board of Directors of the Company to the
undersigned and certain other officers of the Company in resolutions duly adopted on February 13,
2009 and March 18, 2009, the terms and form of the Company’s 5.15% Notes due 2014 (the “Notes due
2014”) and the Company’s 6.25% Notes due 2019 (the “Notes due 2019” and together with the Notes due
2014, the “Notes”), shall be as set forth below. Capitalized terms not defined herein shall have
the meanings ascribed to them in the Indenture.

     1. The Notes due 2014 shall be designated as “5.15% Notes due 2014.”

     2. The Notes due 2019 shall be designated as “6.25% Notes due 2019.”

     3. The aggregate principal amount at Stated Maturity of the Notes due 2014 that may be
authenticated and delivered under the Indenture (not including Notes due 2014 authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of other Notes due 2014
pursuant to Sections 2.06, 2.07, 2.08, 3.02 or 10.04 of the Indenture) initially shall be not more
than $800,000,000. The Company shall have the right from time to time, without the consent of the
existing holders of Notes due 2014, to issue additional notes with the same terms and conditions
and with the same CUSIP number as the Notes due 2014, except for the issue date, issue price and
the first payment of interest thereon (“Additional Notes due 2014”). Additional Notes due 2014
will be consolidated with and will form a single series with the Notes due 2014.

     4. The aggregate principal amount at Stated Maturity of the Notes due 2019 that may be
authenticated and delivered under the Indenture (not including Notes due 2019 authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of other Notes due 2019
pursuant to Sections 2.06, 2.07, 2.08, 3.02 or 10.04 of the Indenture) initially shall be not more
than $700,000,000. The Company shall have the right from time to time, without the consent of the
existing holders of Notes due 2019, to issue additional notes with the same terms and conditions
and with the same CUSIP number as the Notes due 2019, except for the issue date, issue price and
the first payment of interest thereon (“Additional Notes due 2019” and together with the Additional
Notes due 2019, the “Additional Notes”). Additional Notes due 2019 will be consolidated with and
will form a single series with the Notes due 2019.

 

     5. Each Note due 2014 shall bear interest from and including the most recent Interest Payment
Date to which interest on such Note due 2014 (or any predecessor Note due 2014) has been paid or
duly made available for payment, or if no interest has been paid, from and including March 26,
2009, at the rate of 5.15% per annum until the principal thereof is paid or made available for
payment. Each Note due 2019 shall bear interest from and including the most recent Interest
Payment Date to which interest on such Note due 2019 (or any predecessor Note due 2019) has been
paid or duly made available for payment, or if no interest has been paid, from and including March
26, 2009, at the rate of 6.25% per annum until the principal thereof is paid or made available for
payment. Interest shall be payable on each Interest Payment Date and at Stated Maturity. Interest
payments shall be in the amount of interest accrued to, but excluding, the relevant Interest
Payment Date or Stated Maturity, as applicable. Interest shall be payable to the person in whose
name a Note (or any predecessor Note) is registered at the close of business on the Record Date
next preceding each Interest Payment Date; provided, however, that interest payable at Stated
Maturity shall be payable to the person to whom principal shall be payable. Under certain
circumstances, additional interest on the Notes due 2014 and the Notes due 2019 may be payable as
and to the extent provided in the Issue Date Registration Rights Agreement or any other
Registration Rights Agreement (each as defined in Paragraph 21 of this Certificate)
applicable to Additional Notes.

     The Interest Payment Dates for the Notes shall be April 1 and October 1 of each year and at
Stated Maturity, and the Record Dates for interest payable on the Notes shall be the close of
business on March 15 and September 15 next preceding the April 1 and October 1 Interest Payment
Dates, respectively. Interest on the Notes shall be computed on the basis of a 360-day year of
twelve 30-day months.

     6. The Stated Maturity of each Note due 2014 shall be April 1, 2014.

     7. The Stated Maturity of each Note due 2019 shall be April 1, 2019.

     8. The Notes due 2014 shall be substantially in the form attached to this Certificate as Exhibit A.

     9. The Notes due 2019 shall be substantially in the form attached to this Certificate as
Exhibit B.

     10. The Notes may be redeemed in whole or in part from time to time at the option of the
Company before the applicable date of Stated Maturity at the price and on the terms set forth in
the form of Note attached to this Certificate as Exhibit A in the case of the Notes due
2014 and Exhibit B in the case of the Notes due 2019.

     11. The Notes shall not be entitled to any sinking, purchase or analogous fund, and the
Company shall not be obligated to redeem or purchase the Notes at the option of any Holder thereof.

     12. The Notes shall be issued in minimum denominations of $2,000 and integral multiples of
$1,000 in excess thereof.

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     13. Payments of principal of and any premium or interest on the Notes, when payable, shall be
made in immediately available funds at the Corporate Trust Office in Chicago, Illinois, or in New
York, New York. “Corporate Trust Office” shall mean the principal office of the Trustee in
Chicago, Illinois or New York, New York, at which at any particular time its corporate trust
business shall be administered. On the date of this Certificate, the Corporate Trust Office is
located at 2 N. LaSalle Street, Suite 1020, Chicago IL 60602, Attention: Mary Callahan and 101
Barclay Street, Floor 8W, New York, New York 10286, Attention: Corporate Trust Administration.
Payments of interest on each Note (other than interest payable at Stated Maturity) shall be made by
check mailed to the registered address of the person entitled thereto, unless such person and the
Company shall have agreed that such payment will be made by wire transfer in immediately available
funds. Notwithstanding the foregoing, if the registered owner of the Notes is The Depository Trust
Company (“DTC”) or its nominee, payments of principal and interest shall be made in accordance with
the requirements of DTC pursuant to a Letter of Representations between DTC and the Company.

     14. So long as the Notes remain outstanding, the Company shall maintain an office and agency
in Chicago, Illinois and any other location the Company may designate, where the Notes may be
presented for registration of transfer and exchange, for payment, and where notices and demands to
or upon the Company in respect of such Notes or the Indenture may be served. The office of the
Trustee in such location or locations shall be such office of the Company, and the Trustee shall be
such agent for the Company for the foregoing purposes.

     15. Section 12.02 of the Indenture shall be fully applicable to the Notes.

     16. The Notes shall be issued as registered Notes, without coupons, in the form of one or more
definitive Global Securities. The Depositary for the Notes initially shall be DTC. So long as the
Notes are represented by such Global Securities in accordance with the Indenture, beneficial owners
of interests in such Global Securities may not exchange such interests for Definitive Securities
(as defined in Paragraph 21 of this Certificate) except as otherwise expressly provided in
the Indenture.

     17. Notes originally offered and sold to QIBs (as defined in Paragraph 21 of this
Certificate) in reliance on Rule 144A (as defined in Paragraph 21 of this Certificate) will
be issued in the form of one or more Global Securities (each, a “Rule 144A Global Note”).

     18. Notes originally offered and sold to a Non-U.S. Person (as defined in Paragraph 21
of this Certificate) outside the United States of America in reliance on Regulation S under the
Securities Act (each as defined in Paragraph 21 of this Certificate) will be issued in the
form of one or more Global Securities (each, a “Regulation S Global Note”).

     19. The aggregate principal amount of each Global Security may from time to time be increased
or decreased by adjustments made on the records of the Note Custodian, as provided herein and in
the Indenture.

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     20. Each Global Security shall bear the legend specified therefor on the face thereof in
Exhibit A in the case of a Note due 2014 or Exhibit B in the case of a Note due
2019. Each Restricted Note shall bear the private placement legend (the “Private Placement
Legend”) specified therefor on the face thereof in Exhibit A in the case of a Note due
2014 or Exhibit B in the case of a Note due 2019.

     21. The Notes shall be subject to the provisions set forth below in this Paragraph 21
regarding transfer and exchange. The definitions of capitalized terms used in this Paragraph
21 and not defined in the Indenture will have the meanings set forth below in this
Paragraph 21.

     (a) The following provisions shall apply with respect to any proposed transfer of an interest
in a Rule 144A Global Note that is a Restricted Note: If (1) the owner of a beneficial interest in
a Rule 144A Global Note of a series wishes to transfer such interest (or portion thereof) to a
Non-U.S. Person pursuant to Regulation S and (2) such Non-U.S. Person wishes to hold its interest
in the Notes of such series through a beneficial interest in a Regulation S Global Note of such
series,

          (i) upon receipt by the Note Custodian and Security Registrar of:

     (A) instructions from the Holder of such Rule 144A Global Note of such series
directing the Note Custodian and Security Registrar to credit or cause to be
credited a beneficial interest in a Regulation S Global Note of such series equal to
the principal amount of the beneficial interest in such Rule 144A Global Note to be
transferred, and

     (B) a certificate in the form of Exhibit C in the case of a transfer of
an interest in Notes due 2014 and a certificate in the form of Exhibit D in
the case of a transfer of an interest in Notes due 2019, in each case duly executed
by the transferor, and

     (ii) in accordance with the rules and procedures of the Depositary, the Note Custodian
and Security Registrar shall increase such Regulation S Global Note and decrease such Rule
144A Global Note by such amount in accordance with the foregoing.

     (b) If the owner of an interest in a Regulation S Global Note of a series that is a Restricted
Note wishes to transfer such interest (or any portion thereof) to a QIB pursuant to Rule 144A,

          (i) upon receipt by the Note Custodian and Security Registrar of:

     (A) instructions from the Holder of such Regulation S Global Note of such
series directing the Note Custodian and Security Registrar to credit or cause to be
credited a beneficial interest in a Rule 144A Global Note of such series equal to
the principal amount of the beneficial interest in such Regulation S Global Note to
be transferred, and

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     (B) a certificate in the form of Exhibit E in the case of a transfer of
an interest in Notes due 2014 and a certificate in the form of Exhibit F in
the case of a transfer of an interest in Notes due 2019, in each case duly executed
by the transferor, and

     (ii) in accordance with the rules and procedures of the Depositary, the Note Custodian
and Security Registrar shall increase such Rule 144A Global Note and decrease such
Regulation S Global Note by such amount in accordance with the foregoing.

     (c) Other Transfers. Any transfer of Restricted Notes not described above (other than
a transfer of a beneficial interest in a Global Security that does not involve an exchange of such
interest for a Definitive Security or a beneficial interest in another Global Security, which must
be effected in accordance with applicable law and the rules and procedures of the Depositary) shall
be made only upon receipt by the Security Registrar of such opinions of counsel, certificates
and/or other information reasonably required by and satisfactory to it in order to ensure
compliance with the Securities Act or in accordance with Paragraph 21(d).

     (d) Use and Removal of Private Placement Legends. Upon the transfer, exchange or
replacement of Notes of a series (or beneficial interests in a Global Security of a series) not
bearing (or not required to bear upon such transfer, exchange or replacement) a Private Placement
Legend, the Note Custodian and Security Registrar shall exchange such Notes (or beneficial
interests) for beneficial interests in a Global Security of such series (or Definitive Securities
of such series if they have been issued pursuant to Section 2.03 of the Indenture) that does not
bear a Private Placement Legend. Upon the transfer, exchange or replacement of Notes of a series
(or beneficial interests in a Global Security of a series) bearing a Private Placement Legend, the
Note Custodian and Security Registrar shall deliver only Notes of such series (or beneficial
interests in a Global Security of such series) that bear a Private Placement Legend unless:

     (i) such Notes (or beneficial interests) are exchanged in a Registered Exchange Offer;

     (ii) such Notes (or beneficial interests) are transferred pursuant to a Shelf
Registration Statement;

     (iii) such Notes (or beneficial interests) are transferred pursuant to Rule 144 upon
delivery to the Security Registrar of a certificate in the form of Exhibit G in the
case of a transfer of Notes due 2014 (or a beneficial interest therein) and a certificate in
the form of Exhibit H in the case of a transfer of Notes due 2019 (or a beneficial
interest therein), in each case duly executed by the transferor, and an Opinion of Counsel
reasonably satisfactory to the Security Registrar;

     (iv) such Notes (or beneficial interests) are transferred, replaced or exchanged after
the Resale Restriction Termination Date therefor; or

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     (v) in connection with such transfer, exchange or replacement the Security Registrar
shall have received an Opinion of Counsel and other evidence reasonably satisfactory to it
and the Company to the effect that neither such Private Placement Legend nor the related
restrictions on transfer are required in order to maintain compliance with the provisions of
the Securities Act.

The Private Placement Legend on any Note shall be removed at the request of the Holder thereof on
or after the Resale Restriction Termination Date therefor. The Holder of a Global Security of a
series may exchange an interest therein for an equivalent interest in a Global Security of such
series not bearing a Private Placement Legend (other than a Regulation S Global Note of such
series) upon transfer of such interest pursuant to any of clauses (i) through (v) of this
Subparagraph (d). The Company shall deliver to the Trustee an Officers’ Certificate
promptly upon effectiveness, withdrawal or suspension of any Registration Statement.

     (e) Consolidation of Global Securities and Exchange of Definitive Securities for
Beneficial Interests in Global Securities. If a Global Security of a series not bearing a
Private Placement Legend (other than a Regulation S Global Note of such series) is Outstanding at
the time of a Registered Exchange Offer, any interests in a Global Security of such series
exchanged in such Registered Exchange Offer shall be exchanged for interests in such Outstanding
Global Security of such series.

     (f) Issuance of Exchange Notes for Issue Date Notes. In accordance with the Issue
Date Registration Rights Agreement, the Company will execute, and upon Company Direction the
Trustee will authenticate, Exchange Notes of a series in exchange for Issue Date Notes of a
corresponding series.

     (g) Definitions.

     “Definitive Securities” means any Security issued in fully-registered certificated
form pursuant to Section 2.03 of the Indenture (other than a Global Note), which shall be
substantially in the form of Exhibit A or Exhibit B, as applicable, with
appropriate legends as specified in this Paragraph 21 and Exhibit A and Exhibit
B.

     “Distribution Compliance Period” means, in respect of any Regulation S Global Note,
the 40 consecutive days beginning on and including the later of (a) the day on which any Notes
represented thereby are offered to persons other than distributors (as defined in Regulation S
under the Securities Act) pursuant to Regulation S and (b) the issue date for such Notes.

     “Exchange Notes” means debt securities of a series of the Company substantially
identical in all material respects to the Notes of a corresponding series (except that the
additional interest provisions and the transfer restrictions pertaining to the Notes of such series
will be modified or eliminated, as appropriate) to be issued pursuant to the Indenture.

     “Exchange Offer Registration Statement” has the meaning assigned to it in the Issue
Date Registration Rights Agreement and any other Registration Rights Agreement.

- 6 -

 

     “Issue Date” means the first date of issuance of Notes provided for under this
Certificate.

     “Issue Date Notes” means the $800,000,000 aggregate principal amount of Notes due 2014
and the $700,000,000 aggregate principal amount of Notes due 2019 originally issued on the Issue
Date, and any replacement Securities and Exchange Notes, issued therefor in accordance with the
Indenture.

     “Issue Date Registration Rights Agreement” means the Registration Rights Agreement,
dated as of March 26, 2009, by and among the Company and HSBC Securities (USA) Inc. and Banc of
America Securities LLC, as Initial Purchasers.

     “Non-U.S. Person” means a person who is not a U.S. person, as defined in Regulation S.

     “Note Custodian” means the custodian with respect to any Global Note appointed by the
Depositary, or any successor Person thereto, and shall initially be the Trustee.

     “Private Placement Legend” has the meaning assigned to it in Paragraph 20 of
this Certificate.

     “QIB” means any “qualified institutional buyer” (as defined in Rule 144A).

     “Registered Exchange Offer” means an exchange offer by the Company registered under
the Securities Act pursuant to which Notes of a series originally issued pursuant to an exemption
from registration under the Securities Act are exchanged for Notes of a corresponding series of
like principal amount not bearing the Private Placement Legend.

     “Registration Rights Agreement” means any registration rights agreement between the
Company and one or more investment banks acting as initial purchasers in connection with any
issuance of Notes under the Indenture, including the Issue Date Registration Rights Agreement.

     “Registration Statement” means an effective Exchange Offer Registration Statement or
Shelf Registration Statement.

     “Regulation S” means Regulation S under the Securities Act or any successor
regulation.

     “Resale Restriction Termination Date” means, for any Restricted Note that is an Issue
Date Note (or beneficial interest therein), one year (or such shorter period of time as permitted
by Rule 144 or any successor provision) from the Issue Date or, for any Additional Notes (or
beneficial interests therein) that are Restricted Notes, one year (or such other period specified
in Rule 144) from the latest such original issue date of such Additional Notes.

     “Restricted Note” means any Issue Date Note (or beneficial interest therein) or any
Additional Note (or beneficial interest therein) not originally issued and sold pursuant to an
effective registration statement under the Securities Act until such time as:

- 7 -

 

     (i) such Issue Date Note (or beneficial interest therein) or Additional Note (or
beneficial interest therein) has been exchanged for a corresponding Exchange Note pursuant
to an Exchange Offer Registration Statement or has been transferred pursuant to a Shelf
Registration Statement;

     (ii) the Resale Restriction Termination Date therefor has passed;

     (iii) if such Note is a Regulation S Global Note, the Distribution Compliance Period
therefor has terminated; or

     (iv) the Private Placement Legend therefor has otherwise been removed pursuant to
Paragraph 21(d) of this Certificate or, in the case of a beneficial interest in a
Global Note, such beneficial interest has been exchanged for an interest in a Global Note
not bearing a Private Placement Legend.

     “Rule 144” means Rule 144 under the Securities Act (or any successor rule).

     “Rule 144A” means Rule 144A under the Securities Act (or any successor rule).

     “Securities Act” means the Securities Act of 1933, as amended.

     “Shelf Registration Statement” shall have the meaning assigned to such term in the
Issue Date Registration Rights Agreement and any other Registration Rights Agreement.

     Each of the undersigned certifies that there is no Event of Default existing on the date
hereof, and no event which with notice or lapse of time or both could become an Event of Default
has occurred and is continuing on the date hereof.

     Each of the undersigned states that all conditions precedent provided for in the Indenture
relating to delivery of the executed Notes to the Trustee for authentication and delivery have been
complied with.

     Each of the undersigned further states that he has read the provisions of the Indenture
relating to the issuance of the Notes and the definitions relating thereto; that the statements
made in this Certificate are based upon an examination of the provisions of the Indenture and upon
the relevant books and records of the Company; that he has, in his opinion, made such examination
or investigation as is necessary to enable him to express an informed opinion as to whether or not
the conditions included in such provisions have been complied with; and that, in his opinion, such
conditions have been complied with.

- 8 -

 

     IN WITNESS WHEREOF, the undersigned have executed this Certificate as of this 26th
day of March 2009.

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ronald D. Kropp
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ronald D. Kropp	 	 
	 

	 	Title:
	 	Senior Vice President &

Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Felix L. Rodriguez, Jr.	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Felix L. Rodriguez, Jr.	 	 
	 

	 	Title:
	 	Vice President & Treasurer	 	 

- 9 -

 

EXHIBIT A

FORM OF NOTE

[Include the following legend for Global Securities only:]

[THIS IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC, TO DTC OR TO A SUCCESSOR DEPOSITARY OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO IN THE ADDITIONAL TERMS ATTACHED HERETO.]

[Include the following Private Placement Legend on all Notes that are Restricted Notes:]

[THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF
AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE THAT IS ONE YEAR
(OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR
PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF
THIS NOTE) AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF
THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION TERMINATION DATE”) EXCEPT (A)
TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT (AND THAT CONTINUES TO BE

 

EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS
A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE
THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE.]

A-2

 

FORM OF

ILLINOIS TOOL WORKS INC.

5.15% NOTE DUE 2014

Principal Amount $[                    ]

as revised by the Schedule of Increases and

Decreases in Global Security attached hereto

			
	 	 	 
	No. ___-___
	 	[Date]
	 
	 	CUSIP NO. [                         ]
	 
	 	ISIN NO. [                    ]

     ILLINOIS TOOL WORKS INC., a corporation incorporated under the laws of the State of Delaware
(hereinafter called the “Company”), for value received, hereby promises to pay to CEDE & CO., or
its registered assigns, the principal sum of                                          DOLLARS ($                    ) subject to
adjustment from time to time as reflected on the Schedule of Increases and Decreases in Global
Security attached hereto on April 1, 2014, at the office or agency of the Company in Chicago,
Illinois or New York, New York or such other location or locations as may be provided for pursuant
to the Indenture referred to herein, in such coin or currency of the United States of America as at
the time of payment shall be legal tender for the payment of public and private debts, and to pay
interest on said principal sum, in arrears, from and including the most recent Interest Payment
Date (as defined below) to which interest has been paid or duly provided for (or if no interest has
been paid, from and including March 26, 2009), to, but excluding, April 1 and October 1 of each
year (each, an “Interest Payment Date”), beginning on October 1, 2009, at the rate of 5.15% per
annum, at said offices or agencies, in like coin or currency, to but excluding the date on which
said principal sum is paid in full. The Record Date with respect to each Interest Payment Date
shall be the close of business on March 15 or September 15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. The interest payable on any Interest
Payment Date will, subject to certain exceptions provided in the Indenture referred to herein, be
paid by check mailed to the registered address of the person entitled thereto, unless such person
and the Company shall have agreed that such payment will be made by wire transfer in immediately
available funds. Notwithstanding the foregoing, if the registered owner of the Notes is The
Depository Trust Company (“DTC”) or its nominee, payments of principal and interest shall be made
in accordance with the requirements of DTC pursuant to a Letter of Representations between DTC and
the Company.

     The further provisions of this Security are continued in an attachment hereto and such
continued provisions shall for all purposes have the same effect as though fully set forth at this
place.

     This Security shall not be valid or become obligatory for any purpose until the certificate of
authentication hereon shall have been signed manually by the Trustee under the Indenture referred
to herein.

[signature page follows]

A-3

 

     IN WITNESS WHEREOF, ILLINOIS TOOL WORKS INC. has caused this Security to be manually signed by
its duly authorized officers and its corporate seal to be affixed hereto.

	 	 	 	 	 	 	 
	 	 	ILLINOIS TOOL WORKS INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ronald D. Kropp	 	 
	 

	 	Title:
	 	Senior Vice President &

Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	[SEAL]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Felix L. Rodriguez, Jr.	 	 
	 

	 	Title:
	 	Vice President & Treasurer	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Maria C. Green	 	 
	 

	 	Title:
	 	Deputy General Counsel &

Assistant Secretary	 	 

A-4

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

     This is one of the Securities of the series designated herein issued under the
within-mentioned Indenture.

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK MELLON 

TRUST COMPANY, N.A., as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	     Authorized Signature	 	 

THE ADDITIONAL TERMS ATTACHED HERETO ARE INCORPORATED BY REFERENCE HEREIN AND DEEMED TO BE A PART
HEREOF.

A-5

 

ADDITIONAL TERMS OF

ILLINOIS TOOL WORKS INC.

5.15% NOTE DUE 2014

     This Security is one of a duly authorized issue of the Securities of Illinois Tool Works Inc.,
a Delaware corporation (the “Company”), designated as its 5.15% Notes due 2014 (individually, a
“Security” and collectively, the “Securities”), issued under and pursuant to an Indenture dated as
of November 1, 1986 and supplemented by a First Supplemental Indenture dated as of May 1, 1990 (the
“Indenture”), duly executed and delivered by the Company and The Bank of New York Mellon Trust
Company, N.A., as successor trustee (the “Trustee”). The terms of the Securities include those
stated in the Indenture and in the Officers’ Certificate dated March 26, 2009 (the “Officers’
Certificate”) establishing certain terms of the Securities pursuant to the Indenture, those made
part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”), and
those set forth in this Security. This Security is subject to all such terms, and Holders are
referred to the Indenture, the Officer’s Certificate and the TIA for a statement of all such terms.
All terms used in this Security that are defined in the Indenture or in the Officers’ Certificate
shall have the meanings assigned to them therein. The Securities are unsecured general obligations
of the Company.

     The Securities are initially limited to the aggregate principal amount of Eight Hundred
Million Dollars ($800,000,000), as specified in the Officers’ Certificate. The Company may from
time to time, without the consent of the existing Holders of Securities, issue additional
Securities with the same terms and conditions and with the same CUSIP number as the Securities,
except for the issue date, issue price and the first payment of interest thereon. Additional
Securities so issued will be consolidated with and will form a single series with the Securities.

     Under certain circumstances, additional interest may be payable as and to the extent provided
in the Issue Date Registration Rights Agreement or any other Registration Rights Agreement
applicable to Additional Notes.

     In case an Event of Default, as defined in the Indenture, relating to the Securities shall
have occurred and be continuing, the principal hereof may be declared, and upon such declaration
shall become, due and payable, in the manner, with the effect and subject to the provisions
contained in the Indenture. The Indenture provides that, prior to the declaration of maturity of
the Securities upon the occurrence of an Event of Default relating to the Securities, the Holders
of a majority in aggregate principal amount at Stated Maturity of the Securities at the time
outstanding may on behalf of the Holders of all of the Securities waive any past default under the
Indenture relating to the Securities and its consequences, except a default in the payment of the
principal of and premium, if any, or interest on any of the Securities. Any such consent or waiver
by the Holder of this Security (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such Holder and upon all future Holders and owners of this Security and of any
Security issued upon the registration of transfer hereof or in exchange or substitution herefor,
irrespective of whether or not any notation of such consent or waiver is made upon this Security or
such other Securities.

A-6

 

     This Security may be redeemed in whole or in part at any time and from time to time, at the
option of the Company, at a redemption price equal to the greater of (i) 100% of the principal
amount of the Securities to be redeemed on the date of redemption or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest on the Securities being
redeemed on the date of redemption (exclusive of interest accrued to the date of redemption)
discounted to the date of redemption on a semiannual basis at the Treasury Rate (as defined below)
plus 50 basis points, as determined by a Reference Treasury Dealer (as defined below), plus, in
each case, accrued and unpaid interest on the principal amount being redeemed to the date of
redemption. Notwithstanding the foregoing, installments of interest on Securities that are due and
payable on Interest Payment Dates falling on or prior to a date of redemption will be payable on
the Interest Payment Date to the registered holder hereof as of the close of business on the
relevant Record Date according to this Security and the Indenture. The redemption price will be
calculated on the basis of a 360-day year consisting of twelve 30-day months.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Reference Treasury Dealer as having a maturity comparable to the remaining term of the Securities
to be redeemed that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of comparable maturity to
the remaining term of such Securities.

     “Comparable Treasury Price” means, with respect to any redemption date, (i) the average of the
Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (ii) if fewer than four such Reference
Treasury Dealer Quotations are obtained, the average of all such quotations, or (iii) if only one
Reference Treasury Dealer Quotation is received, such quotation.

     “Primary Treasury Dealer” means a primary United States government securities dealer in the
United States.

     “Reference Treasury Dealer” means (i) Banc of America Securities LLC and HSBC Securities (USA)
Inc. (or their respective affiliates that are Primary Treasury Dealers) and their respective
successors; provided, however, that if any of the foregoing shall cease to be a Primary Treasury
Dealer, the Company will substitute therefor another Primary Treasury Dealer and (ii) any other
Primary Treasury Dealer(s) (in any case not less than two) selected by the Company.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Company, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Company by such Reference Treasury Dealer at 3:30 p.m., New York City
time, on the third business day preceding such redemption date.

     “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity (on a day count basis) of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such redemption date.

A-7

 

     Notice of a redemption will be mailed to holders of Securities to be redeemed by first-class
mail at least 30 and not more than 60 days prior to the date fixed for redemption. On and after
the redemption date, interest will cease to accrue on the Securities or portions thereof called for
redemption unless the Company defaults in payment of the redemption price. If fewer than all of
the Securities are to be redeemed, the Trustee will select, not more than 60 days prior to the
redemption date, the particular Securities or portions thereof for redemption from the outstanding
Securities not previously called by such method as the Trustee deems fair and appropriate;
provided, however, that no Securities of a principal amount of $2,000 or less shall be redeemed in
part.

     Except as otherwise specifically provided herein, the Securities may not be redeemed before
April 1, 2014 (herein referred to as the “Stated Maturity”) and shall not be entitled to any
sinking, purchase or analogous fund, nor shall the Company be obligated to redeem or purchase the
Securities at the option of any Holder thereof.

     The Indenture contains provisions permitting the Company and the Trustee, with the consent of
the Holders of not less than a majority in aggregate principal amount at Stated Maturity of the
Securities at the time outstanding, evidenced as provided in the Indenture, to execute supplemental
indentures which, if they pertain specifically to the Securities, may add any provisions to or
change in any manner or eliminate any of the provisions of the Indenture relating to the Securities
or of any supplemental indenture relating to the Securities or modifying in any manner the rights
of the Holders of the Securities; provided, however, that no such supplemental indenture shall (i)
extend the Stated Maturity of any Security, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of any interest thereon, or reduce any premium payable upon the
redemption thereof, or change the currency in which any Security is payable, without the consent of
the Holder of each Security so affected, or (ii) reduce the aforesaid majority in aggregate
principal amount of Securities, the consent of the Holders of which is required for any such
supplemental indenture relating to the Securities, without the consent of the Holders of all
Securities then outstanding.

     The Company may terminate all of its obligations under the Securities and the Indenture as it
relates to the Securities, with certain limited exceptions described in the Indenture, by (i)
irrevocably depositing in trust with the Trustee money or Government Obligations (or any
combination thereof) sufficient to pay principal of and any premium or interest on the Securities
at Stated Maturity and (ii) complying with certain other conditions specified in the Indenture.
Alternatively, the Company may, upon the making of such deposit and the satisfaction of certain
conditions specified in the Indenture, omit to comply with its covenants in the Indenture relating
to creation of secured indebtedness (Section 4.05), sale and lease-back transactions (Section
4.06), and transactions involving a merger or consolidation of the Company into or with any other
corporation or a sale, conveyance or lease of the property of the Company substantially as an
entirety to any other corporation or entity (Article Eleven), and such omission shall not be an
Event of Default with respect to the Securities.

     The Securities are issuable as registered Securities without coupons in denominations of
$2,000 and any integral multiple of $1,000. At the office or agency to be maintained by the
Company in Chicago, Illinois, New York, New York or at such other location or locations as may be
provided for in the Indenture, and in the manner and subject to the limitations provided in the
Indenture, Securities may be exchanged by the Holder thereof without charge except for

A-8

 

any tax or other governmental charge imposed in respect thereof, for a like aggregate principal
amount at Stated Maturity of Securities of other authorized denominations.

     Subject to the limitations provided in the Indenture, the Officers’ Certificate and herein,
this Security is transferable and the registration of the transfer hereof may be effected by the
registered Holder hereof or by his attorney duly authorized in writing upon due presentment for
registration of transfer at the office or agency of the Company in Chicago, Illinois, New York, New
York or at such other location or locations as may be provided for in the Indenture, but only in
the manner and subject to the limitations provided in the Indenture, the Officers’ Certificate and
herein, without charge except for any tax or other governmental charge imposed in relation thereto.
Upon any such registration of transfer, a new Security or Securities of authorized denominations
for a like aggregate principal amount at Stated Maturity will be issued to the transferee in
exchange therefor.

     Prior to due presentment for registration of transfer of this Security, the Company, the
Trustee, any paying agent and the Security Registrar may deem and treat the registered Holder
hereof as the absolute owner hereof (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by any person), for the
purpose of receiving payment as herein provided and for all other purposes, and neither the Company
nor the Trustee nor any paying agent nor any Security Registrar shall be affected by any notice to
the contrary.

     No recourse shall be had for the payment of the principal of or the interest on this Security,
or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer,
director or employee, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company, whether by virtue of any constitution, statute
or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as a condition of and part of the consideration for the issue
hereof, expressly waived and released.

     The Indenture and this Security shall be governed by and construed in accordance with the laws
of the State of Illinois.

A-9

 

[FORM OF TRANSFER NOTICE]

     FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and transfer(s)
unto

Insert Taxpayer Identification No.

                                                                                

Please print or typewrite name and address including zip code of assignee

                                                                                

the within Note and all rights thereunder, hereby irrevocably constituting and appointing
               
              
               
                 attorney to transfer said Note
on the books of the Company with full power of substitution in the premises.

[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL RESTRICTED NOTES]

     In connection with any transfer of this Note occurring prior to the date which is the earlier
of (i) the date the Shelf Registration Statement is declared effective or (ii) the end of the
one-year period referred to in Rule 144 or any successor provision under the Securities Act, the
undersigned confirms that without utilizing any general solicitation or general advertising that:

[Check One]

[     ] (a) this Note is being transferred in compliance with the exemption from registration under
the Securities Act provided by Rule 144A thereunder.

or

[     ] (b) this Note is being transferred other than in accordance with (a) above and documents are
being furnished which comply with the conditions of transfer set forth in this Note and the
Indenture.

If none of the foregoing boxes is checked, the Trustee or other Securities Registrar shall not be
obligated to register this Note in the name of any Person other than the Holder hereof unless and
until the conditions to any such transfer of registration set forth herein and in the Indenture and
the Officer’s Certificate shall have been satisfied.

	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	NOTICE: The signature to this assignment must correspond with the
name as written upon the face of the within-mentioned instrument in
every particular, without alteration or any change whatsoever.

Signature must be guaranteed by a participant in a recognized signature guaranty medallion program
or other signature guarantor acceptable to the Trustee.

A-10

 

TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

     The undersigned represents and warrants that it is purchasing this Note for its own account or
an account with respect to which it exercises sole investment discretion and that it and any such
account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities
Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as the undersigned has requested pursuant to
Rule 144A or has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned’s foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	NOTICE: To be executed by an executive officer

A-11

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The following increases or decreases in this Global Security have been made:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Principal Amount of	 	Signature of
	 	 	Amount of decrease	 	Amount of increase	 	this Global Note	 	authorized signatory
	 	 	in Principal Amount	 	in Principal Amount	 	following such	 	of Trustee or Note
	Date of Exchange	 	of this Global Note	 	of this Global Note	 	decrease or increase	 	Custodian
	 
	 	 	 	 	 	 	 	 

A-12

 

EXHIBIT B

FORM OF NOTE

[Include the following legend for Global Securities only:]

[THIS IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC, TO DTC OR TO A SUCCESSOR DEPOSITARY OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO IN THE ADDITIONAL TERMS ATTACHED HERETO.]

[Include the following Private Placement Legend on all Notes that are Restricted Notes:]

[THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF
AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE THAT IS ONE YEAR
(OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR
PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF
THIS NOTE) AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF
THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION TERMINATION DATE”) EXCEPT (A)
TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT (AND THAT CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE NOTES

 

 

ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS
A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE
THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE.]

B-2

 

FORM OF

ILLINOIS TOOL WORKS INC.

6.25% NOTE DUE 2019

Principal Amount $[           ]

as revised by the Schedule of Increases and

Decreases in Global Security attached hereto

	 	 	 
	No. ___-___

	 	[Date]
	 

	 	CUSIP NO. [               ]
	 

	 	ISIN NO. [          ]

     ILLINOIS TOOL WORKS INC., a corporation incorporated under the laws of the State of Delaware
(hereinafter called the “Company”), for value received, hereby promises to pay to CEDE & CO., or
its registered assigns, the principal sum of
                                         DOLLARS ($                    ) subject to
adjustment from time to time as reflected on the Schedule of Increases and Decreases in Global
Security attached hereto on April 1, 2019, at the office or agency of the Company in Chicago,
Illinois or New York, New York or such other location or locations as may be provided for pursuant
to the Indenture referred to herein, in such coin or currency of the United States of America as at
the time of payment shall be legal tender for the payment of public and private debts, and to pay
interest on said principal sum, in arrears, from and including the most recent Interest Payment
Date (as defined below) to which interest has been paid or duly provided for (or if no interest has
been paid, from and including March 26, 2009), to, but excluding, April 1 and October 1 of each
year (each, an “Interest Payment Date”), beginning on October 1, 2009, at the rate of 6.25% per
annum, at said offices or agencies, in like coin or currency, to but excluding the date on which
said principal sum is paid in full. The Record Date with respect to each Interest Payment Date
shall be the close of business on March 15 or September 15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. The interest payable on any Interest
Payment Date will, subject to certain exceptions provided in the Indenture referred to herein, be
paid by check mailed to the registered address of the person entitled thereto, unless such person
and the Company shall have agreed that such payment will be made by wire transfer in immediately
available funds. Notwithstanding the foregoing, if the registered owner of the Notes is The
Depository Trust Company (“DTC”) or its nominee, payments of principal and interest shall be made
in accordance with the requirements of DTC pursuant to a Letter of Representations between DTC and
the Company.

     The further provisions of this Security are continued in an attachment hereto and such
continued provisions shall for all purposes have the same effect as though fully set forth at this
place.

     This Security shall not be valid or become obligatory for any purpose until the certificate of
authentication hereon shall have been signed manually by the Trustee under the Indenture referred
to herein.

[signature page follows]

B-3

 

     IN WITNESS WHEREOF, ILLINOIS TOOL WORKS INC. has caused this Security to be manually signed by
its duly authorized officers and its corporate seal to be affixed hereto.

	 	 	 	 	 	 	 
	 	 	ILLINOIS TOOL WORKS INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	  

Ronald
D. Kropp
	 	 
	 

	 	Title:
	 	Senior Vice President &	 	 
	 

	 	 	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	[SEAL]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	  

Felix
L. Rodriguez, Jr.
	 	 
	 

	 	Title:
	 	Vice President & Treasurer	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	  

Maria
C. Green
	 	 
	 

	 	Title:
	 	Deputy General Counsel &	 	 
	 

	 	 	 	Assistant Secretary	 	 

B-4

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

     This is one of the Securities of the series designated herein issued under the
within-mentioned Indenture.

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK MELLON 

TRUST COMPANY, N.A., as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

          Authorized Signature
	 	 

THE ADDITIONAL TERMS ATTACHED HERETO ARE INCORPORATED BY REFERENCE HEREIN AND DEEMED TO BE A PART
HEREOF.

B-5

 

ADDITIONAL TERMS OF

ILLINOIS TOOL WORKS INC.

6.25% NOTE DUE 2019

     This Security is one of a duly authorized issue of the Securities of Illinois Tool Works Inc.,
a Delaware corporation (the “Company”), designated as its 6.25% Notes due 2019 (individually, a
“Security” and collectively, the “Securities”), issued under and pursuant to an Indenture dated as
of November 1, 1986 and supplemented by a First Supplemental Indenture dated as of May 1, 1990 (the
“Indenture”), duly executed and delivered by the Company and The Bank of New York Mellon Trust
Company, N.A., as successor trustee (the “Trustee”). The terms of the Securities include those
stated in the Indenture and in the Officers’ Certificate dated March 26, 2009 (the “Officers’
Certificate”) establishing certain terms of the Securities pursuant to the Indenture, those made
part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”), and
those set forth in this Security. This Security is subject to all such terms, and Holders are
referred to the Indenture, the Officer’s Certificate and the TIA for a statement of all such terms.
All terms used in this Security that are defined in the Indenture or in the Officers’ Certificate
shall have the meanings assigned to them therein. The Securities are unsecured general obligations
of the Company.

     The Securities are initially limited to the aggregate principal amount of Seven Hundred
Million Dollars ($700,000,000), as specified in the Officers’ Certificate. The Company may from
time to time, without the consent of the existing Holders of Securities, issue additional
Securities with the same terms and conditions and with the same CUSIP number as the Securities,
except for the issue date, issue price and the first payment of interest thereon. Additional
Securities so issued will be consolidated with and will form a single series with the Securities.

     Under certain circumstances, additional interest may be payable as and to the extent provided
in the Issue Date Registration Rights Agreement or any other Registration Rights Agreement
applicable to Additional Notes.

     In case an Event of Default, as defined in the Indenture, relating to the Securities shall
have occurred and be continuing, the principal hereof may be declared, and upon such declaration
shall become, due and payable, in the manner, with the effect and subject to the provisions
contained in the Indenture. The Indenture provides that, prior to the declaration of maturity of
the Securities upon the occurrence of an Event of Default relating to the Securities, the Holders
of a majority in aggregate principal amount at Stated Maturity of the Securities at the time
outstanding may on behalf of the Holders of all of the Securities waive any past default under the
Indenture relating to the Securities and its consequences, except a default in the payment of the
principal of and premium, if any, or interest on any of the Securities. Any such consent or waiver
by the Holder of this Security (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such Holder and upon all future Holders and owners of this Security and of any
Security issued upon the registration of transfer hereof or in exchange or substitution herefor,
irrespective of whether or not any notation of such consent or waiver is made upon this Security or
such other Securities.

B-6

 

     This Security may be redeemed in whole or in part at any time and from time to time, at the
option of the Company, at a redemption price equal to the greater of (i) 100% of the principal
amount of the Securities to be redeemed on the date of redemption or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest on the Securities being
redeemed on the date of redemption (exclusive of interest accrued to the date of redemption)
discounted to the date of redemption on a semiannual basis at the Treasury Rate (as defined below)
plus 50 basis points, as determined by a Reference Treasury Dealer (as defined below), plus, in
each case, accrued and unpaid interest on the principal amount being redeemed to the date of
redemption. Notwithstanding the foregoing, installments of interest on Securities that are due and
payable on Interest Payment Dates falling on or prior to a date of redemption will be payable on
the Interest Payment Date to the registered holder hereof as of the close of business on the
relevant Record Date according to this Security and the Indenture. The redemption price will be
calculated on the basis of a 360-day year consisting of twelve 30-day months.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Reference Treasury Dealer as having a maturity comparable to the remaining term of the Securities
to be redeemed that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of comparable maturity to
the remaining term of such Securities.

     “Comparable Treasury Price” means, with respect to any redemption date, (i) the average of the
Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (ii) if fewer than four such Reference
Treasury Dealer Quotations are obtained, the average of all such quotations, or (iii) if only one
Reference Treasury Dealer Quotation is received, such quotation.

     “Primary Treasury Dealer” means a primary United States government securities dealer in the
United States.

     “Reference Treasury Dealer” means (i) Banc of America Securities LLC and HSBC Securities (USA)
Inc. (or their respective affiliates that are Primary Treasury Dealers) and their respective
successors; provided, however, that if any of the foregoing shall cease to be a Primary Treasury
Dealer, the Company will substitute therefor another Primary Treasury Dealer and (ii) any other
Primary Treasury Dealer(s) (in any case not less than two) selected by the Company.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Company, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Company by such Reference Treasury Dealer at 3:30 p.m., New York City
time, on the third business day preceding such redemption date.

     “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity (on a day count basis) of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such redemption date.

B-7

 

     Notice of a redemption will be mailed to holders of Securities to be redeemed by first-class
mail at least 30 and not more than 60 days prior to the date fixed for redemption. On and after
the redemption date, interest will cease to accrue on the Securities or portions thereof called for
redemption unless the Company defaults in payment of the redemption price. If fewer than all of
the Securities are to be redeemed, the Trustee will select, not more than 60 days prior to the
redemption date, the particular Securities or portions thereof for redemption from the outstanding
Securities not previously called by such method as the Trustee deems fair and appropriate;
provided, however, that no Securities of a principal amount of $2,000 or less shall be redeemed in
part.

     Except as otherwise specifically provided herein, the Securities may not be redeemed before
April 1, 2019 (herein referred to as the “Stated Maturity”) and shall not be entitled to any
sinking, purchase or analogous fund, nor shall the Company be obligated to redeem or purchase the
Securities at the option of any Holder thereof.

     The Indenture contains provisions permitting the Company and the Trustee, with the consent of
the Holders of not less than a majority in aggregate principal amount at Stated Maturity of the
Securities at the time outstanding, evidenced as provided in the Indenture, to execute supplemental
indentures which, if they pertain specifically to the Securities, may add any provisions to or
change in any manner or eliminate any of the provisions of the Indenture relating to the Securities
or of any supplemental indenture relating to the Securities or modifying in any manner the rights
of the Holders of the Securities; provided, however, that no such supplemental indenture shall
(i) extend the Stated Maturity of any Security, or reduce the principal amount thereof, or reduce
the rate or extend the time of payment of any interest thereon, or reduce any premium payable upon
the redemption thereof, or change the currency in which any Security is payable, without the
consent of the Holder of each Security so affected, or (ii) reduce the aforesaid majority in
aggregate principal amount of Securities, the consent of the Holders of which is required for any
such supplemental indenture relating to the Securities, without the consent of the Holders of all
Securities then outstanding.

     The Company may terminate all of its obligations under the Securities and the Indenture as it
relates to the Securities, with certain limited exceptions described in the Indenture, by
(i) irrevocably depositing in trust with the Trustee money or Government Obligations (or any
combination thereof) sufficient to pay principal of and any premium or interest on the Securities
at Stated Maturity and (ii) complying with certain other conditions specified in the Indenture.
Alternatively, the Company may, upon the making of such deposit and the satisfaction of certain
conditions specified in the Indenture, omit to comply with its covenants in the Indenture relating
to creation of secured indebtedness (Section 4.05), sale and lease-back transactions
(Section 4.06), and transactions involving a merger or consolidation of the Company into or with
any other corporation or a sale, conveyance or lease of the property of the Company substantially
as an entirety to any other corporation or entity (Article Eleven), and such omission shall not be
an Event of Default with respect to the Securities.

     The Securities are issuable as registered Securities without coupons in denominations of
$2,000 and any integral multiple of $1,000. At the office or agency to be maintained by the
Company in Chicago, Illinois, New York, New York or at such other location or locations as may be
provided for in the Indenture, and in the manner and subject to the limitations provided in the
Indenture, Securities may be exchanged by the Holder thereof without charge except for

B-8

 

any tax or other governmental charge imposed in respect thereof, for a like aggregate principal amount at
Stated Maturity of Securities of other authorized denominations.

     Subject to the limitations provided in the Indenture, the Officers’ Certificate and herein,
this Security is transferable and the registration of the transfer hereof may be effected by the
registered Holder hereof or by his attorney duly authorized in writing upon due presentment for
registration of transfer at the office or agency of the Company in Chicago, Illinois, New York, New
York or at such other location or locations as may be provided for in the Indenture, but only in
the manner and subject to the limitations provided in the Indenture, the Officers’ Certificate and
herein, without charge except for any tax or other governmental charge imposed in relation thereto.
Upon any such registration of transfer, a new Security or Securities of authorized denominations
for a like aggregate principal amount at Stated Maturity will be issued to the transferee in
exchange therefor.

     Prior to due presentment for registration of transfer of this Security, the Company, the
Trustee, any paying agent and the Security Registrar may deem and treat the registered Holder
hereof as the absolute owner hereof (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by any person), for the
purpose of receiving payment as herein provided and for all other purposes, and neither the Company
nor the Trustee nor any paying agent nor any Security Registrar shall be affected by any notice to
the contrary.

     No recourse shall be had for the payment of the principal of or the interest on this Security,
or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer,
director or employee, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company, whether by virtue of any constitution, statute
or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as a condition of and part of the consideration for the issue
hereof, expressly waived and released.

     The Indenture and this Security shall be governed by and construed in accordance with the laws
of the State of Illinois.

B-9

 

[FORM OF TRANSFER NOTICE]

     FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and
transfer(s) unto

 

Insert Taxpayer Identification No.

                                                                                                    

Please print or typewrite name and address including zip code of assignee

                                                                                                    

the within Note and all rights thereunder, hereby irrevocably constituting and appointing
                                                            
attorney to transfer
said Note on the books of the Company with full power of substitution in the premises.

[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL RESTRICTED NOTES]

     In connection with any transfer of this Note occurring prior to the date which is the earlier
of (i) the date the Shelf Registration Statement is declared effective or (ii) the end of the
one-year period referred to in Rule 144 or any successor provision under the Securities Act, the
undersigned confirms that without utilizing any general solicitation or general advertising that:

[Check One]

[    ]      (a)      this Note is being transferred in compliance with the exemption from registration under
the Securities Act provided by Rule 144A thereunder.
 

or

[    ]      (b)      this Note is being transferred other than in accordance with (a) above and documents are
being furnished which comply with the conditions of transfer set forth in this Note and the
Indenture.

If none of the foregoing boxes is checked, the Trustee or other Securities Registrar shall not be
obligated to register this Note in the name of any Person other than the Holder hereof unless and
until the conditions to any such transfer of registration set forth herein and in the Indenture and
the Officer’s Certificate shall have been satisfied.

 

	 	 	 	 	 
	Date:

	 	  
	 	 
	 

	 	 
	 	 
	 

	 	 
	 	NOTICE: The signature to this assignment must correspond with the
name as written upon the face of the within-mentioned instrument in
every particular, without alteration or any change whatsoever.

Signature must be guaranteed by a participant in a recognized signature guaranty medallion program
or other signature guarantor acceptable to the Trustee.

B-10

 

TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

     The undersigned represents and warrants that it is purchasing this Note for its own account or
an account with respect to which it exercises sole investment discretion and that it and any such
account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities
Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as the undersigned has requested pursuant to
Rule 144A or has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned’s foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

	 	 	 	 	 	 	 
	Dated:

 

	 	  
 

	 	  

NOTICE:
To be executed by an executive officer
	 	 

B-11

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The following increases or decreases in this Global Security have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal Amount of	 	 	Signature of	 
	 	 	Amount of decrease	 	 	Amount of increase	 	 	this Global Note	 	 	authorized signatory	 
	 	 	in Principal Amount	 	 	in Principal Amount	 	 	following such	 	 	of Trustee or Note	 
	Date of Exchange	 	of this Global Note	 	 	of this Global Note	 	 	decrease or increase	 	 	Custodian	 
	 
	 	 	 	 

B-12

 

EXHIBIT C

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 5.15% NOTES DUE 2014

PURSUANT TO REGULATION S

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	5.15% Notes due 2014 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     This letter relates to the proposed transfer of $[                    ] aggregate principal amount of
the Notes [in the case of a transfer of an interest in a Rule 144A Global Note: , which
represents an interest in a Rule 144A Global Note of the above named series beneficially owned] by
the undersigned (the “Transferor”) and in connection with such transfer, the exchange of
such interest for an equivalent beneficial interest in a Regulation S Global Note of the same
series. In connection with such transfer, we confirm that such transfer is being effected pursuant
to and in accordance with Regulation S under the Securities Act of 1933, as amended (the
“Securities Act”), and, accordingly, we represent that:

     (a) the offer of the Notes was not made to a person in the United States;

     (b) either (i) at the time the buy order was originated, the transferee was outside the
United States or we and any person acting on our behalf reasonably believed that the
transferee was outside the United States or (ii) the transaction was executed in, on or
through the facilities of a designated off-shore securities market and neither we nor any
person acting on our behalf knows that the transaction has been pre-arranged with a buyer in
the United States;

     (c) no directed selling efforts have been made in the United States in contravention of
the requirements of Rule 903 or Rule 904 of Regulation S, as applicable;

     (d) the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act; and

 

 

(e) the Transferor is the beneficial owner of the principal amount of Notes being
transferred.

     In addition, if the transfer is made during a Distribution Compliance Period, (i) the
beneficial interest in such Regulation S Global Note will be held through the Euroclear System or
Clearstream Banking (as indirect participants in DTC), and (ii) if the provisions of Rule 904(b)(1)
or Rule 904(b)(2) of Regulation S are applicable thereto, we confirm that such transfer has been
made in accordance with the applicable provisions of Rule 904(b)(1) or Rule 904(b)(2), as the case
may be.

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby. Terms used in this
letter and defined in Regulation S have the meanings set forth in Regulation S.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature
	 	 

 

 

EXHIBIT D

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 6.25% NOTES DUE 2019

PURSUANT TO REGULATION S

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	6.25% Notes due 2019 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     This letter relates to the proposed transfer of $[                    ] aggregate principal amount of
the Notes [in the case of a transfer of an interest in a Rule 144A Global Note: , which
represents an interest in a Rule 144A Global Note of the above named series beneficially owned] by
the undersigned (the “Transferor”) and in connection with such transfer, the exchange of
such interest for an equivalent beneficial interest in a Regulation S Global Note of the same
series. In connection with such transfer, we confirm that such transfer is being effected pursuant
to and in accordance with Regulation S under the Securities Act of 1933, as amended (the
“Securities Act”), and, accordingly, we represent that:

     (a) the offer of the Notes was not made to a person in the United States;

     (b) either (i) at the time the buy order was originated, the transferee was outside the
United States or we and any person acting on our behalf reasonably believed that the
transferee was outside the United States or (ii) the transaction was executed in, on or
through the facilities of a designated off-shore securities market and neither we nor any
person acting on our behalf knows that the transaction has been pre-arranged with a buyer in
the United States;

     (c) no directed selling efforts have been made in the United States in contravention of
the requirements of Rule 903 or Rule 904 of Regulation S, as applicable;

     (d) the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act; and

 

 

     (e) the Transferor is the beneficial owner of the principal amount of Notes being
transferred.

     In addition, if the transfer is made during a Distribution Compliance Period, (i) the
beneficial interest in such Regulation S Global Note will be held through the Euroclear System or
Clearstream Banking (as indirect participants in DTC), and (ii) if the provisions of Rule 904(b)(1)
or Rule 904(b)(2) of Regulation S are applicable thereto, we confirm that such transfer has been
made in accordance with the applicable provisions of Rule 904(b)(1) or Rule 904(b)(2), as the case
may be.

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby. Terms used in this
letter and defined in Regulation S have the meanings set forth in Regulation S.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature
	 	 

 

 

EXHIBIT E

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 5.15% NOTES DUE 2014 TO QIB

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	5.15% Notes due 2014 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     This letter relates to the transfer of $[                    ] aggregate principal amount of Notes [in
the case of a transfer of an interest in a Regulation S Global Note:   , which represents an
interest in a Regulation S Global Note of the above-mentioned series beneficially owned] by the
undersigned (the “Transferor”), and in connection with such transfer, the exchange of such
interest for an equivalent beneficial interest in a Rule 144A Global Note of the same series.

     In connection with such request, and with respect to such Notes, the Transferor does hereby
certify that that (i) the Transferor is the beneficial owner of the principal amount of Notes being
transferred and (ii) such Notes are being transferred in accordance with Rule 144A under the
Securities Act of 1933, as amended (“Rule 144A”), to a transferee that the Transferor
reasonably believes is purchasing the Notes for its own account or for one or more accounts with
respect to which the transferee exercises sole investment discretion, and the transferee, as well
as any such account, is a “qualified institutional buyer” within the meaning of Rule 144A,
in a transaction meeting the requirements of Rule 144A and in accordance with applicable securities
laws of any state of the United States or any other jurisdiction.

 

 

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature
	 	 

 

 

EXHIBIT F

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 6.25% NOTES DUE 2019 TO QIB

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	6.25% Notes due 2019 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     This letter relates to the transfer of $[                    ] aggregate principal amount of Notes [in
the case of a transfer of an interest in a Regulation S Global Note:   , which represents an
interest in a Regulation S Global Note of the above-mentioned series beneficially owned] by the
undersigned (the “Transferor”), and in connection with such transfer, the exchange of such
interest for an equivalent beneficial interest in a Rule 144A Global Note of the same series.

     In connection with such request, and with respect to such Notes, the Transferor does hereby
certify that that (i) the Transferor is the beneficial owner of the principal amount of Notes being
transferred and (ii) such Notes are being transferred in accordance with Rule 144A under the
Securities Act of 1933, as amended (“Rule 144A”), to a transferee that the Transferor
reasonably believes is purchasing the Notes for its own account or for one or more accounts with
respect to which the transferee exercises sole investment discretion, and the transferee, as well
as any such account, is a “qualified institutional buyer” within the meaning of Rule 144A,
in a transaction meeting the requirements of Rule 144A and in accordance with applicable securities
laws of any state of the United States or any other jurisdiction.

 

 

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature
	 	 

 

 

EXHIBIT G

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 5.15% NOTES DUE 2014 PURSUANT TO RULE 144

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	5.15% Notes due 2014 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     In connection with the proposed transfer of $[                    ] aggregate principal amount of the
Notes [in the case of a transfer of an interest in a Rule 144A Global Note:   , which represents an
interest in a Rule 144A Global Note beneficially owned] by the undersigned (the
“Transferor”), the Transferor hereby certifies that (i) the Transferor is the beneficial
owner of the principal amount of Notes being transferred and (ii) such transfer is being effected
pursuant to and in accordance with Rule 144 under the Securities Act of 1933, as amended.

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature
	 	 

 

 

EXHIBIT H

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 6.25% NOTES DUE 2019 PURSUANT TO RULE 144

[Date]

The Bank of New York Mellon Trust Company, N.A.

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

			
	                    Re:	 	6.25% Notes due 2019 (the “Notes”)

of Illinois Tool Works Inc. (the “Company”)

Ladies and Gentlemen:

     Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented
by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to
time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon
Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of March 26,
2009, relating to the Notes (the “Officers’ Certificate”). Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

     In connection with the proposed transfer of $[                    ] aggregate principal amount of the
Notes [in the case of a transfer of an interest in a Rule 144A Global Note:   , which represents an
interest in a Rule 144A Global Note beneficially owned] by the undersigned (the
“Transferor”), the Transferor hereby certifies that (i) the Transferor is the beneficial
owner of the principal amount of Notes being transferred and (ii) such transfer is being effected
pursuant to and in accordance with Rule 144 under the Securities Act of 1933, as amended.

     You and the Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.

     Very truly yours,

     [Name of Transferor]

	 	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 

	 	 	 	 	 
	 

	 	  

Authorized
Signature

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