Document:

Filed by Bowne Pure Compliance

Exhibit 10.1

November 18, 2008

James Gregory Ford

81 Buckingham Lane

Belle Mead, NJ 08502

Dear Greg:

I am very pleased to offer you the position of Vice President, Business Development with PolyMedix.
In this capacity you will function in a leadership role, setting the strategic direction of and
carrying out our business development and licensing activities. We look forward to your joining our
senior management team.

The principle elements of your offer are as follows:

	1.	 	Commencement Date: Your position will be effective as of December 1, 2008, or as
otherwise may be mutually agreed.
	 
	2.	 	Duties and Responsibilities: You will be employed by PolyMedix (the “Company”) as our
Vice President of Business Development. You will report to the President & C.E.O. This
position is key to the future success of PolyMedix and you agree to use your best efforts to
perform such duties faithfully, and while you remain employed, not to engage in any other
business activity that is in conflict with your duties and obligations to the Company.
	 
	3.	 	Stock Options: Subject to Stockholder and Board of Director’s approval, you will be
granted four hundred thousand (400,000) incentive stock options for Common shares. These stock
options will vest at 50% on your second anniversary date, and monthly over the next two years
(years three and four). These shares will have an exercise price per Share equal to market
value of our common stock on the date granted as determined by the Compensation Committee of
the Board of Directors. You may be qualified for additional options during the time of your
employment. These options are considered performance options and will be awarded and
determined by the Board of Directors.
	 
	4.	 	Compensation: You will receive an initial annual salary of $260,000 per year.
Within the first 90 days of employment, you and I will finalize measurable goals and
objectives. You and I will review these goals and objectives on an on-going basis as
necessary. Your compensation may be adjusted based on your performance and the Company’s
performance, as may be determined and granted by the Compensation Committee and the Board of
Directors.
	 
	 	 	Bonus: You will be eligible to receive a discretionary cash bonus. This bonus will be paid out
dependant upon both your individual goal achievement and the performance of the Company, on the
recommendation of the Compensation Committee and the approval of the Board of Directors. As
with most executive positions there are many variables that may affect a potential bonus. PolyMedix may award bonus amounts, at its discretion, for
accomplishments and achievements in lieu of or in addition to those stated below.

 

 

 

Your maximum potential cash bonus for calendar year 2009 will be up to 100% of your base salary
amount, $260,000. Your ability to earn a potential bonus payment is contingent on your remaining
employed with the Company on the payment date. The payment date for all bonus payments for
executive management is anticipated to be in January 2010 for performance in the 2009 calendar
year.

For 2009, your anticipated individual goal achievement and bonus eligibility will be based on
the following criteria:

	 	•	 	For cash revenues generated in 2009 in out-licensing deals which you served as the
primary and lead negotiator and were essential to concluding, your target bonus for 2009
will be calculated as 1% of the cash revenues actually received by PolyMedix in
2009, comprised of up-front or milestone payments actually received in 2009. Amounts
received by PolyMedix for investment in equity or other financial securities of the
Company, payment for sponsored research or development activities, purchase of materials
under a manufacturing or supply agreement, or royalties on product sales, shall not be
eligible for calculation of this bonus amount.
	 
	 	•	 	For equity investments in PolyMedix made by corporate partners as part of a strategic
investment or business opportunity which you which you served as the primary and lead
negotiator and were essential to concluding, you will be eligible for a bonus payment based
on the investments actually received in 2009.
	 
	 	•	 	For in-license in 2009 of a marketed or clinical stage Low Molecular Weight Heparin
(LMWH product) which you served as the primary and lead negotiator and were essential to
concluding, you will be eligible for a 35% bonus payment. You will also be eligible for a
bonus payment for in-license of any other clinical stage product, the specific amount to be
determined depending on the product.

All licensing deals are subject to the approval of the C.E.O. and the Board of Directors. Your
role in all licensing deals and eligibility for bonus payment(s) is subject to the
determination, review, and approval of the President & C.E.O. and the Board of Directors.

	5.	 	Relocation: To assist you with your relocation PolyMedix will make available to you
a one-time payment in the gross amount of $40,000. You may choose to accept this relocation
payment at your discretion any time within the first 12 months of your employment. If you
choose to accept this relocation payment you must then subsequently complete your relocation
within 12 months of your accepting this payment. You will be responsible for any and all
income and other taxes that may be applicable to or payable on this relocation amount.
PolyMedix will suggest a relocation company to you to help manage your relocation; however,
you are not required to use the services of this company. If you should voluntarily resign
your employment with PolyMedix within 24 months of accepting this relocation payment, or if you are terminated for Cause, you agree to repay to PolyMedix the full
amount of this sign-on relocation bonus within 20 days of the termination of your employment.

 

 

 

	6.	 	Benefits: You will be eligible to participate in our employee benefits program;
which currently includes: medical, dental, prescription, retirement, short term disability,
long term disability benefits and any other benefits that the company implements for similarly
situated positions.
	 
	7.	 	Time Off: PolyMedix currently recognizes twelve (12) annual paid holidays including
New Year’s Day, Martin Luther King Day, President’s Day, Memorial Day, July 4th,
Labor Day, Thanksgiving Day, the day following Thanksgiving Day, Christmas Day and three (3)
floating days per year to be used at your discretion. In addition, beginning January 1, 2009
PolyMedix will permit you to use up to twenty (20) annual discretionary days of paid vacation.
Vacation days will accrue upon commencement of employment (at a rate of 1.66 days per month).
PolyMedix reserves the right to request deferral of discretionary vacation time within the
annual period to meet business demands of the Company. Vacation days must be used in the
calendar year in which they are accrued and may not be carried over from year to year.
Vacation days have no monetary value and are not payable upon separation from the Company.
PolyMedix reserves the right to change this vacation policy at any time.
	 
	8.	 	Separation: You will be free to resign from the Company at any time, and the Company
will be free to terminate your employment at any time. If your employment should be
involuntarily terminated by the Company for a reason other than “Cause”, or insolvency or
bankruptcy of the Company (“Qualified Termination”), you will be entitled to severance
benefits consisting of: (a) continuation of your base salary for one (1) year; (b) the Company
will pay the cost of your COBRA premiums for up to twelve (12) months after such termination;
and (c) under the provisions of the Company’s Equity Compensation Plan and the Change of
Control Provisions, all of your unvested stock options would fully vest; provided, however,
that the severance benefits set forth in subparagraphs (a), (b), and (c) above are contingent
on your execution and non-revocation of a General Release Agreement in a form acceptable to
the Company, attached below. These severance benefits are not payable in the event of
bankruptcy or insolvency of the Company, or if you would be entitled to severance benefits
under a Change of Control Agreement. If a Qualified Termination occurs within 24 months of
commencement of your employment, 200,000 options for shares of your initial grant of 400,000
options shall vest; and if such Qualified Termination occurs after 24 months of commencement
of your employment, the full 400,000 options for shares of your initial grant of 400,000
options shall vest, in either case such acceleration of vesting shall supersede the vesting
schedule provided in (3) above. Your right to such payments, vesting and/or grants and
benefits pursuant to the preceding sentences shall be conditional upon your execution of a
customary release of all claims against the Company and its affiliates and representatives in
a form satisfactory to the Company.

 

 

 

“Cause” means your (a) failure, refusal, or neglect to timely perform any reasonable and
lawful duty of your position or the lawful directives of the President & Chief Executive Officer; (b) commission of an act that constitutes misconduct, including fraud, and is injurious
to the Company (c) conviction of, or pleading “guilty” or “no contest” to, a felony under the
laws of the United States or any state thereof; (d) committing an act of fraud against, or the
misappropriation of property belonging to, the Company ; (e) commission of an act of dishonesty
in connection with your responsibilities as an employee and affecting the business or affairs of
the Company; (f) breach of this Letter Agreement, any confidentiality, proprietary information
or other agreement between you and the Company or any subsidiary; or (g) you commit an act
involving moral turpitude, dishonesty, fraud or breach of the Company’s Code of Professional
Ethics or Operating Guidelines, attached to this letter, in the course of your employment with
the Company.

In the event of a Change in Control, where another entity acquires ownership or control of more
than 50% of PolyMedix equity, and your employment is subsequently involuntarily terminated for
other than Cause, the Company’s Equity Compensation Plan provides for acceleration and full
vesting of all unvested stock options.

	9.	 	Confidential Information: You acknowledge and agree that confidential information,
obtained by you while employed by the Company, or any of its subsidiaries concerning the
business affairs of the Company or any subsidiary of the Company are the property of the
Company or such subsidiary (hereinafter, “Confidential Information”). You agree to sign and
abide by Confidentiality and Inventorship, Securities Trading Policy, Trading Lock-up, and
Code of Ethics and Business Conduct agreements as will be required by the Company.
Consequently, you agree that, except to the extent required by applicable law, statute,
ordinance, rule, regulation or orders of courts or regulatory authorities, you shall not at
any time (whether during or after the your employment) disclose to any unauthorized person or
use for your own account any Confidential Information without the prior written consent of the
Company, unless and to the extent that the aforementioned matters are or become generally
known to and available for use by the public other than as a result of your acts or omissions
to act or as required by law. You shall deliver to the Company at the termination of your
employment, or at any other time the Company may request, all memoranda, notes, plans,
records, reports, computer tapes and software and other documents and data (and copies
thereof) containing or constituting Confidential Information which you may then possess or
have under your control.
	 
	10.	 	Future Cooperation: You agree that upon the Company’s reasonable request following your termination of employment, you will use reasonable efforts to assist and cooperate with the
Company in connection with the defense or prosecution of any claim that may be made against or
by the Company or its affiliates arising out of or relating to events occurring

during your employment, or in connection with any ongoing or future investigation or dispute or
claim of any kind involving the Company or its affiliates, including any proceeding before any
arbitral, administrative, regulatory, judicial, legislative, or other body or agency. You will
be reimbursed for reasonable out-of-pocket expenses (including travel expenses) incurred in
connection with providing such assistance as permitted by law.

 

 

 

	11.	 	Withholding: The Company shall have the right to withhold from any amount payable to
you, hereunder an amount necessary in order for the Company to satisfy any withholding tax
obligation it may have under applicable law, and may condition the grant, vesting or exercise of any stock-based award on your making arrangements satisfactory to the Company to enable it to
satisfy any withholding obligation arising in connection with such grant, vesting or exercise.

	12.	 	Governing Law: The terms of this Letter Agreement, and any action arising
thereunder, shall be governed by and construed in accordance with the domestic laws of the
Commonwealth of Pennsylvania, without giving effect to any choice of law or conflict of law
provision or rule (whether of the Commonwealth of Pennsylvania or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the Commonwealth of
Pennsylvania.
	 
	13.	 	Waiver: This Letter Agreement may not be released, changed or modified in any manner, except by an instrument in writing signed by you and the Company. The failure of either party
to enforce any of the provisions of this Letter Agreement shall in no way be construed to be a
waiver of any such provision. No waiver of any breach of this Letter Agreement shall be held to
be a waiver of any other or subsequent breach.
	 
	14.	 	Assignment: This Letter Agreement is personal to you. You shall not assign this
Letter of Agreement or any of your rights and/or obligations under this Letter Agreement to any other
person. The Company may, without your consent, assign this Letter Agreement to any successor to
its business.
	 
	15.	 	Dispute Resolution: To benefit mutually from the time and cost savings of arbitration
over the delay and expense of the use of the federal and state court systems, all disputes
involving your employment or this Letter Agreement, including, but not limited to, claims
under Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, the Age
Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act of 1990,
The Americans With Disabilities Act of 1990, the Civil Rights Act of 1866, the Employee
Retirement Income Security Act of 1974, the Family and Medical Leave Act of 1993, the Civil
Rights Act of 1991, and any other federal, state or local laws, rules or regulations, will be
resolved by binding arbitration before the American Arbitration Association., JAMS/ENDISPUTE,
or any other similar association mutually agreed to by the Company and you Any such
arbitration shall be held in Philadelphia or other mutually agreeable location. The award of
the arbitrators shall be final and binding and judgment upon the award may be entered in any
court having jurisdiction thereof. Except as otherwise provided above, this procedure shall be
the exclusive means of settling any disputes that may arise under this Letter Agreement. All
fees and expenses of the arbitrators and all other expenses of the arbitration, shall be paid

in accordance with the applicable rules of arbitration regarding employment disputes. Each
party shall bear its own witness expenses and attorneys’ fees.
	 
	16.	 	Survival: Notwithstanding anything contained herein to the contrary, the provisions
of paragraphs 9, 11 and 14 shall survive termination of your employment with the Company and
its affiliates.

 

 

 

	17.	 	Entire Agreement; No Conflicts: This Letter Agreement supersedes all previous and contemporaneous communications, agreements and understandings, whether oral or written, between
you, on the one hand, and the Company or any of its affiliates, on the other hand, and
constitutes the sole and entire agreement between you and the Company pertaining to the subject
matter hereof. You represent and warrant to the Company that your acceptance of employment and
the performance of your duties for the Company will not conflict with or result in a violation
or breach of, or constitute a default under any contract, agreement or understanding to which
you are or were a party or of which you are aware and that there are no restrictions, covenants,
agreements or limitations on your right or ability to enter into and perform the terms of this
Letter Agreement.
	 
	18.	 	Counterparts: This Letter Agreement may be executed in one or more counterparts, all
of which shall be considered one and the same agreement, and shall become a binding agreement
when one or more counterparts have been signed by each party and delivered to the other party.

Please indicate your acceptance of our offer of employment on the terms and conditions outlined
above by signing and returning to us one copy of this letter. This offer will be valid until and a
signed copy of this letter must be returned by Friday November 21, 2008.

Greg, I am looking forward to working together with you to make PolyMedix a tremendous success.

Sincerely yours,

/s/ Nicholas Landekic

Nicholas Landekic

President & C.E.O.

AGREED TO AND ACCEPTED BY:

	 	 	 	 	 	 	 
	/s/ James Gregory Ford

	 	 	 	Date:
	 	November 18, 2008
	 

	 	 	 	 	 	 
	James Gregory Fordex_4-1.htm

     

    
      EXHIBIT
4.1

      

       

      THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A
DEPOSITARY.  THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES HEREINAFTER DESCRIBED AND MAY NOT BE TRANSFERRED EXCEPT AS
A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY.

       

      UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.,
OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREON, CEDE & CO. HAS AN INTEREST
HEREIN.

       

      CATERPILLAR
INC.

       

      _____% NOTES DUE
_____

       

      
        	
                REGISTERED

                NO.
      _____

              	
                $__________

                 

                CUSIP 149123
      _____

                ISIN
      US149123_____

              

      

      

      CATERPILLAR INC., a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the “Company”, which term includes any successor corporation
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Cede & Co., as nominee for The Depository Trust Company,
or registered assigns, the principal sum of _______________ Dollars
($__________) on __________, _____, subject to advancement as provided in Annex
A hereto, and to pay interest thereon from __________, _____, or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for, semi-annually on _____ and _____ of each year, commencing __________,
_____, at the rate of _____% per annum, until the principal hereof is paid or
made available for payment and (to the extent that the payment of such interest
shall be legally enforceable) at the rate per annum borne by this Security on
any overdue principal and on any overdue installment of interest.  The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on __________ or __________, respectively, immediately
preceding such Interest Payment Date (whether or not a Business
Day).  Any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture.

       

      Payment of the
principal of and interest on this Security due at Maturity in United States
dollars will be made in immediately available funds to the Depositary or its
nominee, provided that this
Security is presented to the Trustee in time for the Trustee to make such
payment in accordance with its normal procedures.  Payment of interest
(other than interest payable at Maturity) on this Security in United States
dollars will be made by transfer of immediately available funds to the
Depositary or its nominee.

       

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

       

      This Security is
one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an Indenture,
dated as of May 1, 1987, as supplemented (the “Indenture”), between the Company
and U.S. Bank National Association (the successor “Trustee”, which term includes
any successor trustee under the Indenture), to which Indenture all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.  This
Security is one of the series designated on the face hereof, limited initially
in aggregate principal amount to $__________.

       

      The Company may
from time to time, without notice to or the consent of the Holders of the
Securities, create and issue further securities ranking on a parity with the
Securities in all respects (or in all respects except for the payment of
interest accruing prior to the issue date of the Securities) so that further
securities may be consolidated and form a single series with the Securities and
have the same terms as to status, redemption or otherwise as the
Securities.

       

      The Securities
shall have the redemption features summarized in Annex A to this Global
Security.

       

      The provisions for
defeasance and covenant defeasance set forth in Sections 1302 and 1303 of the
Indenture, respectively, will apply to the Securities of this
series.

       

      If any Event of
Default with respect to Securities of this series shall occur and be continuing,
the principal of the Securities of this series may be declared due and payable
in the manner and with the effect provided in the Indenture.

       

      The Indenture
permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of
the Holders of the Securities of each series to be affected under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of
not less than 66 2/3% in principal amount of the Securities at the time
Outstanding of each series to be affected.  The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Securities of each series at the time Outstanding, on behalf of
the Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences.  Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this
Security.

       

      No reference herein
to the Indenture and no provision of this Security or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and interest on this Security at the
times, place and rate, and in the coin or currency herein
prescribed.

       

      As provided in the
Indenture and subject to certain limitations therein and herein set forth, the
transfer of this Security is registrable in the Security Register upon surrender
of this Security for registration of transfer at the office or agency of the
Company in any place where the principal of and interest on this Security are
payable, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities of this series, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.

       

      This Security is a
Global Security and shall be exchangeable for Securities registered in the names
of Persons other than the Depositary with respect to this Global Security or its
nominee only if (x) such Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for this Global Security or at any time ceases
to be a clearing agency registered as such under the Securities Exchange Act of
1934, as amended, (a) the Company executes and delivers to the Trustee a Company
Order that this Global Security shall be exchangeable or (b) there shall have
occurred and be continuing an Event of Default with respect to the
Securities.  If this Global Security is exchangeable pursuant to the
preceding sentence, it shall be exchangeable for Securities issuable in a
minimum denomination of $2,000 and integral multiples of $1,000 thereafter,
registered in such names as such Depositary shall direct.

       

      The Securities of
this series are issuable only in registered form without coupons and when not
represented by one or more Global Securities, (a) will be issuable in a minimum
denomination of $2,000 and integral multiples of $1,000 thereafter and (b) as
provided in the Indenture and subject to certain limitations therein set forth,
will be exchangeable for a like aggregate principal amount of Securities of this
series of a different authorized denomination, as requested by the Holder
surrendering the same.

       

      No service charge
shall be made for any such registration or transfer or exchange, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

       

      Prior to due
presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Security is registered as the owner hereof for all purposes,
whether or not this Security be overdue, and neither the Company, the Trustee
nor any such agent shall be affected by notice to the contrary.

       

      This Security shall
be governed by the laws of the State of New York.

       

      All terms used in
this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

       

      IN WITNESS WHEREOF,
the Company has caused this instrument to be duly executed under its corporate
seal.

       

      Dated: __________,
_____

       

      [SEAL]

      
        	
                CATERPILLAR
      INC.

              
	 
    
	
                By:

              	 
    
	 
    	
                Name:

                Title:

              

      

      

      
        	
                Attest:

              
	 
    
	
                By:

              	 
    
	 
    	
                Name:

                Title:

              

      

      

       

      TRUSTEE’S
CERTIFCATE OF AUTHENTICATION

       

      This is one of the
Securities of the series designated therein referred to in the within-mentioned
Indenture.

       

      
        	
                U.S. BANK
      NATIONAL ASSOCIATION,

                as Trustee

              
	 
    
	
                By

              	 
    
	 
    	
                Name:

                Title:

              

      

       

      
        

      

       

       

      ANNEX
A TO GLOBAL SECURITY

       

      Optional
Redemption

      This Security may
be redeemed in whole at any time or in part from time to time, at the Company’s
option, at a redemption price equal to the greater of

       

      
        	
                ·

              	
                100% of the
      principal amount of the Securities to be redeemed,
  or

              

      

       

      
        	
                ·

              	
                the sum of
      the present values of the remaining scheduled payments of principal and
      interest on the Securities to be redeemed, discounted to the date of
      redemption on a semi-annual basis (assuming a 360-day year consisting of
      twelve 30-day months) at the applicable Treasury Rate plus 50 basis
      points,

              

      

       

      plus, in each case,
accrued and unpaid interest on the principal amount being redeemed to the
redemption date.

       

      “Treasury Rate”
means, with respect to any redemption date, (1) the yield, under the heading
which represents the average for the immediately preceding week, appearing in
the most recently published statistical release designated “H.15(519)” or any
successor publication which is published weekly by the Board of Governors of the
Federal Reserve System and which establishes yields on actively traded United
States Treasury securities adjusted to constant maturity under the caption
“Treasury Constant Maturities,” for the maturity corresponding to the Comparable
Treasury Issue (or, if no maturity is within three months before or after the
Remaining Life, yields for the two published maturities most closely
corresponding to the Comparable Treasury Issue will be determined and the
Treasury Rate will be interpolated or extrapolated from such yields on a
straight line basis, rounding to the nearest month), or (2) if such release (or
any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield-to-maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price of
such redemption date. The Treasury Rate will be calculated on the third Business
Day preceding the redemption date.

       

      “Business Day”
means any calendar day that is not a Saturday, Sunday or legal holiday in New
York, New York and on which commercial banks are open for business in New York,
New York.

       

      “Comparable
Treasury Issue” means the United States Treasury security selected by the
Independent Investment Banker as having a maturity comparable to the remaining
term (“Remaining Life”) of the notes 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 Life of such notes.

       

      “Comparable
Treasury Price” means (1) the average of five Reference Treasury Dealer
Quotations for such redemption date, after excluding the highest and lowest
Reference Treasury Dealer Quotations, or (2) if, after seeking at least five
Reference Treasury Dealer Quotations and excluding the highest and lowest
Reference Treasury Dealer Quotations, the Independent Investment Banker obtains
fewer than five such Reference Dealer Quotations, the average of all such
quotations.

       

      “Independent
Investment Banker” means any of  Banc of America Securities LLC or
J.P. Morgan Securities Inc. and any of their respective successors, as appointed
by us, or, if any of the foregoing is unwilling or unable to select the
Comparable Treasury Issue, a nationally recognized investment banking
institution which is a Primary Treasury Dealer appointed by us.

       

      “Primary Treasury
Dealer” means a primary U.S. government securities dealer in New York, New
York.

       

      “Reference Treasury
Dealer” means (1) any of Banc of America Securities LLC or J.P. Morgan
Securities Inc. and any of their respective successors, as appointed by us,
provided, however, that if any of the foregoing shall cease to be a primary U.S.
government securities dealer in New York, New York (a “Primary Treasury
Dealer”), we will substitute for such dealer another Primary Treasury Dealer,
and (2) any other nationally recognized Primary Treasury Dealer selected by the
Independent Investment Banker and acceptable to us.

       

      “Reference Treasury
Dealer Quotations” means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Independent Investment
Banker, 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
Independent Investment Banker at 5:00 p.m., New York, New York time, on the
third Business Day preceding such redemption date.

       

      Holders of Notes to
be redeemed will receive notice thereof by first-class mail at least 30 and not
more than 60 days before the date fixed for redemption.  If fewer than
all of the Notes are to be redeemed, the Trustee will select the particular
Notes or portions thereof for redemption from the outstanding Notes not
previously called, pro rata or by lot, or in such other manner as the Company
shall direct.

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