Document:

Severance agreement between Registrant and James W Frankola

 Exhibit 10.40 
  
 SEVERANCE AGREEMENT 
  
 THIS AGREEMENT is entered into as of December 31, 2003, by and between JAMES
W. FRANKOLA (the “Employee”) and ARIBA, INC., a Delaware corporation (including any successor that becomes bound by this Agreement, the “Company”). 
  

	 	1.	TERMINATION BENEFITS WITHIN 12 MONTHS AFTER A CHANGE IN CONTROL. 

  

	 	(a)	Qualifying Terminations. This Section 1 shall apply if: 

  
 (i) The Company terminates the Employee’s employment with the Company for a reason other than Cause or Permanent Disability within 12
months after a Change in Control (as such terms are defined below); or 
  
 (ii) The Employee resigns for Good Reason (as defined below) within 12 months after a Change in Control. 
  
 (b) Severance Payment. If this Section 1 applies, then the Employee shall be entitled to receive a severance payment from the Company. The amount
of such payment shall be equal to 200% of the sum of (i) the Employee’s base salary at the annual rate in effect when his employment terminates plus (ii) the Employee’s annual target bonus for the fiscal year in which his employment
terminates. Such payment shall be made in a lump sum in cash on the date the Employee’s employment terminates under Subsection (a)(i) above or not later than the date three business days after his employment terminates under Subsection (a)(ii)
above. 
  
 (c) Acceleration of Vesting. If this Section 1
applies, then all of the Equity held by the Employee at the time of the termination of his employment shall become fully and unconditionally vested, fully exercisable and fully transferable (except for transfer restrictions imposed by law). For this
purpose, the Employee’s “Equity” shall consist of (i) all shares of the capital stock of the Company (“Stock”), (ii) all options and other rights to purchase shares of Stock, (iii) all stock units, performance units or
phantom shares whose value is measured by the value of shares of Stock and (iv) all stock appreciation rights whose value is measured by increases in the value of shares of Stock. 
  
 (d) Extension of Option Exercise Period. If this Section 1 applies, then all options and other rights to purchase
shares of Stock and all stock appreciation rights measured by the value of Stock that are held by the Employee at the time of the termination of his employment shall remain exercisable until the earlier of (i) the date 24 months after the
termination of the Employee’s employment or (ii) the date such options or rights would have expired if the Employee’s employment had not terminated. 
  

(e) Definition of “Board.” For purposes of this Agreement, “Board” shall mean the Board of Directors of the Company.

  

	*	CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. 

 (f) Definition of “Cause.” For purposes of this Section 1 only, “Cause”
shall mean any intentional misconduct that materially injures the Company and its subsidiaries, taken as a whole, or has a material adverse effect on the business or affairs of the Company and its subsidiaries, taken as a whole. 
  
 (g) Definition of “Change in Control.” For purposes
of this Section 1 only, a “Change in Control” shall be determined as follows: 
  
 (i) The consummation of a merger or consolidation of the Company, or any subsidiary of the Company, with or into another entity or any
other corporate reorganization, if immediately after such transaction the Ownership Percentage (as defined below) of persons who were not stockholders of the Company immediately before such transaction is 30% or more; provided, however, that if such
percentage is less than 50%, a majority of the Incumbent Directors may determine prior to the consummation of such transaction that a Change of Control has not occurred after considering all relevant factors; 
  
 (ii) The sale, transfer or other disposition of all or
substantially all of the Company’s assets; 
  
 (iii) A change in the composition of the Board, as a result of which fewer than two-thirds of the incumbent directors are directors who either (A) had been directors of the Company on the date hereof (the “original directors”) or
(B) were elected, or nominated for election, to the Board with the approval of at least a majority of the sum of (I) the original directors who were still in office at the time of the election or nomination and (II) the directors whose election or
nomination was previously so approved (collectively, the “Incumbent Directors”); or 
  
 (iv) Any transaction as a result of which any person is the “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing at least 25% of the total voting power represented by the Company’s then outstanding voting securities. 
  
 For purposes of this Subsection (g), the term “person” shall have the same meaning as when used in sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended, but shall exclude (A) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or of a Parent or Subsidiary and (B) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their ownership of the common stock of the Company. 
  
 For purposes of Paragraph (i) above, the term “Ownership Percentage” means the percentage of the voting power of the outstanding securities of (A) the
continuing or surviving entity and (B) any direct or indirect parent corporation of such continuing or surviving entity. 
  
 For purposes of the proviso in Paragraph (i) above, the factors to be considered by the Board in determining that a Change in Control has not occurred shall
include, without limitation: 
  
 (A) The
Ownership Percentage; 
  

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 (B) Whether there is a change in the composition of the Board of Directors of the Company
or the continuing or surviving entity; 
  
 (C)
Whether there is a change in the management of the Company or the continuing or surviving entity; 
  
 (D) The extent of the anticipated change in the business, operations or assets of the Company or the continuing or surviving entity;

  
 (E) The level of severance benefits available
to comparable management at any entity other than the Company resulting from any transaction specified in Paragraphs (i) through (iv) above; and 
  
 (F) Whether treating the transaction as a Change in Control for purposes of this Agreement is necessary or desirable for purposes of
achieving the business objectives of the transaction specified in Paragraphs (i) through (iv) above. 
  
 A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same
proportions by the persons who held the Company’s securities immediately before such transaction. 
  
 (h) Definition of “Good Reason.” For purposes of this Section 1 only, “Good Reason” shall mean (i) the failure of the
Company’s successor or its parent to appoint the Employee as the Chief Financial Officer or Chief Executive Officer of a corporation whose equity securities are publicly traded on the New York Stock Exchange, the American Stock Exchange or the
National Market System of the Nasdaq Stock Market (or any successor of the foregoing), (ii) a reduction in his level of compensation (including base salary, fringe benefits and participation in bonus or incentive programs) or (iii) a relocation of
his place of employment by more than 50 miles, provided and only if such failure, reduction or relocation is effected by the Company without his consent. Clause (i) in the preceding sentence shall apply only if the Employee was the Company’s
Chief Financial Officer or Chief Executive Officer immediately prior to the Change in Control. 
  
 (i) Definition of “Permanent Disability.” For all purposes under this Agreement, “Permanent Disability” shall mean that the Employee, at the time notice is given, has failed to
perform the duties of his position with the Company for a period of not less than 180 consecutive days (or such longer period as may be required by law) as the result of his incapacity due to physical or mental injury, disability or illness.

  

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	 	2.	TERMINATION BENEFITS BEFORE, OR MORE THAN 12 MONTHS AFTER, A CHANGE IN CONTROL. 

  
 (a) Qualifying Terminations. This Section 2 shall only apply if: 
  
 (i) Section 1 does not apply; 
  
 (ii) Either (A) the Company terminates the Employee’s
employment with the Company for a reason other than Cause or Permanent Disability or (B) the Employee resigns for Good Reason; and 
  
 (iii) Either (A) the Employee and the Company have executed a reciprocal general release (in the form attached hereto as Exhibit A)
of all known and unknown claims that they may then have against each other and have agreed not to prosecute any legal action or other proceeding based on such claims or (B) the Company (at its sole discretion) has determined to waive the requirement
of a reciprocal general release. 
  
 The foregoing notwithstanding, the Employee
and the Company shall not be required to release any claims that they may have against each other arising under (i) the Indemnification Agreement dated September 11, 2002, between the Employee and the Company or (ii) any rights to indemnification,
advancement of expenses or repayment arising under the Company’s Amended and Restated Certificate of Incorporation or the Company’s Amended and Restated Bylaws, in each case as currently in effect or as subsequently amended. 
  
 (b) Severance Pay. If this Section 2 applies, then the Employee shall
be entitled to receive severance payments from the Company for a period of 12 months following the termination of his employment (the “Continuation Period”). Such severance payments shall be made in accordance with the Company’s
standard payroll procedures. The annual rate of such severance payments shall be equal to the sum of (i) the Employee’s base salary at the annual rate in effect when his employment terminates plus (ii) the Employee’s annual target bonus
for the fiscal year in which his employment terminates. In addition to any other remedies that may be available to the Company, severance payments shall cease immediately if the Employee fails to comply with the covenants set forth in Section 3
below. 
  
 (c) Acceleration of Vesting. If this Section 2
applies, then: 
  
 (i) The vested portion of all
restricted shares of Stock held by the Employee at the time of the termination of his employment shall at all times thereafter be determined by adding 12 months to his actual period of service with the Company. 
  
 (ii) The Employee shall continue to vest in the Equity held
by him at the time of the termination of his employment (other than restricted shares of Stock) during the Continuation Period, subject to his compliance with the covenants set forth in Section 3 below. The monthly rate of vesting during the
Continuation Period shall be the same as prior to the termination of the Employee’s employment. 
  
 (d) Extension of Option Exercise Period. If this Section 2 applies, then all options and other rights to purchase shares of Stock and all stock
appreciation rights measured by the value of Stock that are held by the Employee at the time of the termination of his employment shall remain exercisable until the earlier of: 
  

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 (i) The later of (A) the date 12 months after the termination of the Employee’s
employment or (B) with respect to any increment of options or rights that becomes exercisable later than nine months after the termination of the Employee’s employment, the date three months after such increment becomes exercisable; or

  
 (ii) The date the options or rights would
have expired if the Employee’s employment had not terminated. 
  
 (e) Definition of “Cause.” For purposes of this Section 2 only, “Cause” shall mean: 
  
 (i) Any gross negligence or intentional misconduct that materially injures the Company and its subsidiaries, taken as a whole, or has a
material adverse effect on the business or affairs of the Company and its subsidiaries, taken as a whole; 
  
 (ii) Any unauthorized use or disclosure by the Employee of the Company’s confidential information or trade secrets resulting from
gross negligence that materially injures the Company and its subsidiaries, taken as a whole, or has a material adverse effect on the business or affairs of the Company and its subsidiaries, taken as a whole; 
  
 (iii) A failure by the Employee to comply with the
Company’s written policies or rules that materially injures the Company and its subsidiaries, taken as a whole, or has a material adverse affect on the business or affairs of the Company and its subsidiaries, taken as a whole, provided that the
Board shall have given Employee notice of such failure and an opportunity to cure such failure, if curable; or 
  
 (iv) The Employee’s conviction of, or plea “guilty” or “no contest” to, a felony under the laws of the United
States or any state thereof. 
  
 With respect to acts or omissions described in
Paragraphs (i) and (iii) above, “Cause” shall only be deemed to exist following written notice to the Employee from the Company and his failure to cure such acts or omissions within 30 days of receipt of such written notice. 
  
 (f) Definition of “Good Reason.” For purposes of this
Section 2 only, “Good Reason” shall mean (i) a requirement that the Employee serve in any position other than the Company’s Chief Financial Officer or Chief Executive Officer, (ii) a reduction in his level of compensation (including
base salary, fringe benefits and participation in bonus or incentive programs) or (iii) a relocation of his place of employment by more than 50 miles, provided and only if such requirement, reduction or relocation is effected by the Company without
his consent. Clause (i) in the preceding sentence shall apply only if the Employee resigns in writing within 90 days after receiving written notice that he is required to serve in any position other than the Company’s Chief Financial Officer or
Chief Executive Officer. 
  

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	 	3.	COVENANTS. 

  
 (a) Non-Solicitation. During his employment with the Company and, if Section 2 applies, during the Continuation Period, the Employee shall not
directly or indirectly, personally or through others, solicit or attempt to solicit the employment of any employee of the Company or any of the Company’s affiliates, whether on the Employee’s own behalf or on behalf of any other person or
entity. The term “employment” for purposes of this Subsection (a) means to enter into an arrangement for services as a full-time or part-time employee, independent contractor, agent or otherwise. The Employee and the Company agree that
this provision is reasonably enforced as to any geographic area in which the Company conducts its business. 
  
 (b) Non-Competition. The Employee agrees that, during his employment with the Company and during the Continuation Period (if any), he shall not:

  
 (i) Directly or indirectly, individually or
in conjunction with others, engage in activities that compete with the Company or work for any entity that is part of the Company’s Market; 
  
 (ii) Solicit, serve, contract with or otherwise engage any existing or prospective customer, client or account of the Company on behalf of
any entity that is part of the Company’s Market; or 
  
 (iii) Cause or attempt to cause any existing or prospective customer, client or account of the Company to divert from, terminate, limit or in any manner modify, or fail to enter into, any actual or potential business
relationship with the Company. The Employee and the Company agree that this provision is reasonably enforced with reference to any geographic area in which the Company maintains any such relationship. 
  
 For purposes of this Subsection (b), the Company’s “Market” shall mean (i) all
companies that derive their revenue primarily from e-procurement and/or spend management software sales or sales of software or services aiding companies in sourcing and/or spend management activities and (ii) those companies set forth on Exhibit
B attached hereto. The Employee and the Company agree that the Company’s Market is global in scope. 
  
 (c) Cooperation and Non-Disparagement. The Employee agrees that, during the Continuation Period, he shall cooperate with and assist the Company in
every reasonable respect in facilitating the transition of his duties to his successor; provided that the Employee shall not be required to devote more than 20 hours per month to providing such assistance and cooperation. The Employee further agrees
that, during the Continuation Period, he shall not in any way or by any means disparage the Company, the members of the Board or the Company’s officers and employees. 
  
 (d) Disclosure. The Employee agrees that, during the Continuation Period, he shall inform any new employer or other
person or entity with whom the Employee enters into a business relationship, before accepting employment or entering into a business relationship, of the existence of this Section 3. 
  

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 (e) Construction. If any provision set forth in this Section 3 is not enforceable under the laws
of the state in which the Employee is employed following the termination of his employment with the Company, nothing in this Agreement shall prohibit the Employee from engaging in such lawful conduct; provided, however, that if the Employee elects
to do so, his rights to any of the benefits set forth in Section 2 shall terminate immediately. 
  

	 	4.	PARACHUTE PAYMENTS. 

  
 (a) Parachute Gross-Up Payment. If it is determined that any cash payment of any type to the Employee or for his benefit by the Company, any of its
affiliates, any person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets (within the meaning of section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”), and the regulations thereunder) or any affiliate of such person, whether paid or payable pursuant to the terms of this Agreement or otherwise (the “Total Payments”), would be subject to the excise tax imposed by section
4999 of the Code or any interest or penalties with respect to such excise tax (such excise tax and any such interest or penalties are collectively referred to as the “Excise Tax”), then the Employee shall be entitled to receive an
additional payment (a “Gross-Up Payment”) in an amount calculated to ensure that after the Employee pays all taxes (and any interest or penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up
Payment, the Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments. For purposes of this Section 4, the Excise Tax and any related gross-up benefits shall be determined based on cash compensation,
before consideration of the taxable compensation (if any) related to restricted shares of Stock or options to purchase Stock and arising from this Agreement. 
  
 (b) Determination by Accountant. All determinations and calculations required to be made under this Section 4 shall be made by an independent
accounting firm selected by the Employee from among the largest five accounting firms in the United States (the “Accounting Firm”). The Accounting Firm shall provide its determination (the “Determination”), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any other relevant matter, to the Employee and the Company within five business days after the Employee or the Company made a request (if the Employee reasonably believes that
any of the Total Payments may be subject to the Excise Tax). If the Accounting Firm determines that no Excise Tax is payable by the Employee, it shall furnish the Employee with a written statement that it has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Employee has substantial authority not to report any Excise Tax on his federal income tax return. If a Gross-Up Payment is determined to be payable, it shall be paid to the Employee within five business
days after the Determination has been delivered to him or the Company. Any determination by the Accounting Firm shall be binding upon the Company and the Employee, absent manifest error. 
  
 (c) Over- and Underpayments. As a result of uncertainty in the application of section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments not made by the Company should have been made (“Underpayment”) or that Gross-Up Payments will have been made by the Company that should not
have been made (“Overpayment”). In either event, the Accounting Firm shall 

  

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determine the amount of the Underpayment or Overpayment that has occurred. In the case of an Underpayment, the Company shall promptly pay the amount of such
Underpayment to the Employee or for his benefit. In the case of an Overpayment, the Employee shall, at the direction and expense of the Company, take such steps as are reasonably necessary (including the filing of returns and claims for refund),
follow reasonable instructions from, and procedures established by, the Company, and otherwise reasonably cooperate with the Company to correct such Overpayment, provided, however, that (i) the Employee shall in no event be obligated to return to
the Company an amount greater than the net after-tax portion of the Overpayment that the Employee has retained or has recovered as a refund from the applicable taxing authorities and (ii) this provision shall be interpreted in a manner consistent
with the intent of Subsection (a) above, which is to make the Employee whole, on an after-tax basis, from the application of the Excise Tax, it being understood that the correction of an Overpayment may result in the Employee’s repaying to the
Company an amount that is less than the Overpayment. 
  
 (d)
Limitation on Parachute Payments. Any other provision of this Section 4 notwithstanding, if the Excise Tax could be avoided by reducing the Total Payments by $25,000 or less, then the Total Payments shall be reduced to the extent necessary to
avoid the Excise Tax and no Gross-Up Payment shall be made. If the Accounting Firm determines that the Total Payments are to be reduced under the preceding sentence, then the Company shall promptly give the Employee notice to that effect and a copy
of the detailed calculation thereof. The Employee may then elect, in his sole discretion, which and how much of the Total Payments are to be eliminated or reduced (as long as after such election no Excise Tax shall be payable), and the Employee
shall advise the Company in writing of his election within 10 days of receipt of notice. If the Employee make no such election within such 10-day period, then the Company may elect which and how much of the Total Payments are to be eliminated or
reduced (as long as after such election no Excise Tax shall be payable), and it shall notify the Employee promptly of such election. 
  

	 	5.	EMPLOYMENT AT WILL. 

  
 The Employee’s employment with the Company shall be “at will,” meaning that either the Employee or the Company shall be entitled to
terminate the Employee’s employment at any time and for any reason, with or without Cause. Any contrary representations that may have been made to the Employee shall be superseded by this Agreement. This Agreement shall constitute the full and
complete agreement between the Employee and the Company on the “at will” nature of the Employee’s employment, which may only be changed in an express written agreement signed by the Employee and a duly authorized officer of the
Company. 
  

	 	6.	SUCCESSORS. 

  
 (a) Company’s Successors. This Agreement shall be binding upon any successor (whether direct or indirect and whether by purchase, lease,
merger, consolidation, reorganization, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets. For all purposes under this Agreement, the term “Company” shall include any successor to the
Company’s business and/or assets that becomes bound by this Agreement. 
  

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 (b) Employee’s Successors. This Agreement and all rights of the Employee hereunder shall
inure to the benefit of, and be enforceable by, the Employee’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 
  

	 	7.	ARBITRATION. 

  
 (a) Scope of Arbitration Requirement. The parties hereby waive their rights to a trial before a judge or jury and agree to arbitrate before a
neutral arbitrator any and all claims or disputes arising out of this Agreement and any and all claims arising from or relating to the Employee’s employment with the Company, including (but not limited to) claims against any current or former
employee, director or agent of the Company, claims of wrongful termination, retaliation, discrimination, harassment, breach of contract, breach of the covenant of good faith and fair dealing, defamation, invasion of privacy, fraud,
misrepresentation, constructive discharge or failure to provide a leave of absence, claims regarding commissions, stock options or bonuses, infliction of emotional distress or unfair business practices, or any tort or tort-like causes of action.

  
 (b) Exceptions. The foregoing notwithstanding, the
following are the only claims that may be resolved in any appropriate forum (including courts of law) as required by applicable laws then in effect: (i) claims concerning workers’ compensation benefits; and (ii) claims concerning unemployment
insurance. 
  
 (c) Procedure. The arbitrator’s
decision shall be written and shall include the findings of fact and law that support the decision. The arbitrator’s decision shall be final and binding on both parties, except to the extent applicable law allows for judicial review of
arbitration awards. The arbitrator may award any remedies that would otherwise be available to the parties if they were to bring the dispute in court. The arbitration shall be conducted in accordance with the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association; provided, however that the arbitrator shall allow the discovery authorized by the California Arbitration Act or the discovery that the arbitrator deems necessary for the parties to
vindicate their respective claims or defenses. The arbitration shall take place in Santa Clara County or, at the Employee’s option, the county in which the Employee primarily worked with the Company at the time when the arbitrable dispute or
claim first arose. 
  
 (d) Costs. The parties shall share
the costs of arbitration equally, except that the Company shall bear the cost of the arbitrator’s fee and any other type of expense or cost that the Employee would not be required to bear if he were to bring the dispute or claim in court. Both
the Company and the Employee shall be responsible for their own attorneys’ fees, and the arbitrator may not award attorneys’ fees unless a statute or contract at issue specifically authorizes such an award. 
  

	 	8.	MISCELLANEOUS PROVISIONS. 

  
 (a) Notice. Notices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of the Employee, mailed notices shall be addressed to him at the 

  

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home address that he most recently communicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate
headquarters, and all notices shall be directed to the attention of its Secretary. 
  
 (b) Entire Agreement. This Agreement supersedes and replaces any prior agreements, representations or understandings, whether written, oral or implied, between the Employee and the Company with respect to the
subject matter hereof, including (without limitation) Paragraph 5 of the offer letter dated October 16, 2001. For the avoidance of doubt, Paragraph 6 of such offer letter shall not be superseded by this Agreement and shall remain in effect.

  
 (c) Modifications and Waivers. No provision of this
Agreement shall be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by the Employee and by an authorized officer of the Company (other than the Employee). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time. 
  
 (d) Withholding Taxes. All payments made under this Agreement shall be
subject to reduction to reflect taxes or other charges required to be withheld by law. 
  
 (e) Choice of Law and Severability. This Agreement is executed by the parties in the State of California and shall be interpreted in accordance with the laws of such State (except their provisions governing the
choice of law). If any provision of this Agreement becomes or is deemed invalid, illegal or unenforceable in any jurisdiction by reason of the scope, extent or duration of its coverage, then such provision shall be deemed amended to the extent
necessary to conform to applicable law so as to be valid and enforceable or, if such provision cannot be so amended without materially altering the intention of the parties, then such provision shall be stricken and the remainder of this Agreement
shall continue in full force and effect. Should there ever occur any conflict between any provision contained in this Agreement and any present or future statue, law, ordinance or regulation contrary to which the parties have no legal right to
contract, then the latter shall prevail but the provision of this Agreement affected thereby shall be curtailed and limited only to the extent necessary to bring it into compliance with applicable law. All the other terms and provisions of this
Agreement shall continue in full force and effect without impairment or limitation. 
  
 (f) No Assignment. This Agreement and all rights and obligations of the Employee hereunder are personal to the Employee and may not be transferred or assigned by the Employee at any time; provided that Employee
may assign his rights hereunder pursuant to any property settlement resulting from the dissolution of his marriage on the condition that such rights shall be conditioned upon Employee’s performance of his obligations hereunder as if no such
assignment had occurred. The Company may assign its rights under this Agreement to any entity that assumes the Company’s obligations hereunder in connection with any sale or transfer of all or a substantial portion of the Company’s assets
to such entity. 
  

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 (g) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument. 
  
 IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, on January 12, 2004, effective as of the day and year first above written.

  

			
	

	
	 ARIBA, INC.

		
	By	 	 
	 	 	

	 Title:
	 	 
	 	 	

  

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 EXHIBIT A 
 FORM OF RELEASE 
  
 ARIBA, INC. 
 807 11TH AVENUE 
 SUNNYVALE, CA 94089 
  
 [Date] 
  
 Mr. James W. Frankola 
 [Address] 
  
 Dear Jim: 
  
 This letter (the “Agreement”) confirms the agreement between you and Ariba, Inc. (the “Company”) regarding the termination of your employment with the Company. 
  
 1. Termination Date. Your employment with the Company will
terminate on                     , 20     (the “Termination Date”). 
  
 2. Effective Date and Rescission. You have up to 21 days after you
received this Agreement to review it. You are advised to consult an attorney of your own choosing (at your own expense) before signing this Agreement. Furthermore, you have up to seven days after you signed this Agreement to revoke it. If you wish
to revoke this Agreement after signing it, you may do so by delivering a letter of revocation to me. If you do not revoke this Agreement, the eighth day after the date you signed it will be the “Effective Date.” Because of the seven-day
revocation period, no part of this Agreement will become effective or enforceable until the Effective Date. 
  
 3. Salary and Vacation Pay. On the Termination Date, the Company will pay you
$             (less all applicable withholding taxes and other deductions). This amount represents all of your salary earned through the Termination Date and all of your accrued but
unused vacation time or PTO. You acknowledge that, if you did not execute this Agreement, you would not be entitled to receive any additional money from the Company. The only payments and benefits that you are entitled to receive from the Company in
the future are those specified in this Agreement. 
  
 4.
Severance Benefits. In consideration of executing this Agreement, you will receive from the Company the severance benefits described in Section 2 of the Severance Agreement dated as of December 31, 2003, between you and the Company (the
“Severance Agreement”). As described in Section 2 of the Severance Agreement, the continuation of such severance benefits is subject to your compliance with the covenants described in Section 3 of the Severance Agreement. 
  
 5. Release of Your Claims. In consideration of receiving the severance
benefits described in Section 2 of the Severance Agreement, you waive, release and promise 

  

 
never to assert any claims or causes of action, whether or not now known, against the Company or its predecessors, successors or past or present
subsidiaries, stockholders, directors, officers, employees, consultants, attorneys, agents, assigns and employee benefit plans with respect to any matter, including (without limitation) any matter related to your employment with the Company or the
termination of that employment, including (without limitation) claims to attorneys’ fees or costs, claims of wrongful discharge, constructive discharge, emotional distress, defamation, invasion of privacy, fraud, breach of contract or breach of
the covenant of good faith and fair dealing and any claims of discrimination or harassment based on sex, age, race, national origin, disability or any other basis under Title VII of the Civil Rights Act of 1964, the California Fair Employment and
Housing Act, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act and all other laws and regulations relating to employment. However, this release bars only those claims that arose prior to the execution of this
Agreement. Execution of this Agreement does not bar: 
  
 (a) Any claim that arises hereafter, including (without limitation) a claim for breach of this Agreement; 
  
 (b) Any claim arising under the Indemnification Agreement dated September 11, 2002, between you and the Company, as amended (the
“Indemnification Agreement”); or 
  
 (c) Any claim to indemnification or advancement of expenses arising under the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate”), or the Company’s Amended and Restated Bylaws, as
amended (the “Bylaws”). 
  
 6. Release of the
Company’s Claims. The Company waives, releases and promises never to assert any claims or causes of action, whether or not now known, against you or your successors, agents or assigns with respect to any matter, including (without
limitation) any matter related to your employment with the Company or the termination of that employment, including (without limitation) claims to attorneys’ fees or costs and claims of defamation, fraud, breach of contract or breach of the
covenant of good faith and fair dealing. However, this release bars only those claims that arose prior to the execution of this Agreement. Execution of this Agreement does not bar: 
  
 (a) Any claim that arises hereafter, including (without limitation) a claim for breach of this Agreement;

  
 (b) Any claim arising under the
Indemnification Agreement; or 
  
 (c) Any claim
to repayment arising under the Certificate or the Bylaws. 
  
 7.
Waiver. You and the Company expressly waive and release any and all rights and benefits under Section 1542 of the California Civil Code (or any analogous law of any other state), which reads as follows: “A general release does not extend
to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.” 
  

 13 

 8. Promise Not To Sue. You agree that you will never, individually or with any other person,
commence, aid in any way (except as required by legal process) or prosecute, or cause or permit to be commenced or prosecuted, any action or other proceeding based on any claim that has been released pursuant to Section 5 above. The Company agrees
that it will never, individually or with any other person, commence, aid in any way (except as required by legal process) or prosecute, or cause or permit to be commenced or prosecuted, any action or other proceeding based on any claim that that has
been released pursuant to Section 6 above. 
  
 9. No
Admission. Nothing contained in this Agreement will constitute or be treated as an admission by you or the Company of liability, any wrongdoing or any violation of law. 
  
 10. Proprietary Information and Invention Agreement. At all times in the future, you will remain bound by your
Proprietary Information and Invention Agreement with the Company. This Agreement may be modified only in a written document signed by you and a duly authorized officer of the Company. 
  
 11. Company Property. You represent that you have returned to the Company all property that belongs to the Company,
including (without limitation) copies of documents that belong to the Company and files stored on your computer(s) that contain information belonging to the Company. 
  
 12. Severability. If any term of this Agreement is held to be invalid, void or unenforceable, the remainder of this
Agreement will remain in full force and effect and will in no way be affected, and the parties will use their best efforts to find an alternate way to achieve the same result. 
  
 13. Choice of Law. This Agreement will be construed and interpreted in accordance with the laws of the State of
California (other than their choice-of-law provisions). 
  
 14.
Execution. This Agreement may be executed in counterparts, each of which will be considered an original, but all of which together will constitute one agreement. Execution of a facsimile copy will have the same force and effect as execution
of an original, and a facsimile signature will be deemed an original and valid signature. 
  
 Please indicate your agreement with the above terms by signing below. 
  

			
	Very truly yours,
	
	ARIBA, INC.
		
	By:	 	 
	 	 	

	 Title:
	 	 
	 	 	

  

 14 

 I agree to the terms of this Agreement, and I am voluntarily signing this release of all claims. I acknowledge that I
have read and understand this Agreement, and I understand that I cannot pursue any of the claims and rights that I have waived in this Agreement at any time in the future. 
  

			
	
	

	Signature of James W. Frankola
	Dated:	 	 
	 	 	

  

 15 

 EXHIBIT B 
  

LIST OF COMPANIES 
  
 [*] 
  

	*	CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. 

  

 16FORM OF SENIOR REGISTERED NOTE

 EXHIBIT 4.5 
  

[FORM OF REGISTERED SENIOR NOTE] 
  
 THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY.
THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. 
  
 Unless this Note is presented by an authorized representative of The Depository Trust
Company, a New York corporation (55 Water Street, New York, New York) (“DTC”), to the Corporation or its agent for registration of transfer, exchange or payment, and this Note is registered in the name of Cede & Co. or such other name
as requested by an authorized representative of DTC, and unless any payment 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 hereof, Cede & Co.,
has an interest herein. 
  
 THIS NOTE IS NOT A SAVINGS ACCOUNT OR A DEPOSIT, IS
NOT AN OBLIGATION OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF BANK OF AMERICA CORPORATION, AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY. 
  

			
	 REGISTERED
	 	 $                              

		
	 NUMBER R
                    
	 	 CUSIP
                    

  
 BANK OF AMERICA
CORPORATION 
             % SENIOR NOTE, DUE
                     
  
 BANK OF AMERICA CORPORATION, a Delaware corporation (herein called the “Corporation,” which term includes any successor corporation under the
Indenture referred to on the reverse hereof), for value received, hereby promises to pay to                      or its registered assigns,
the principal sum of                              DOLLARS1 on                     ,
            2 (except to the extent redeemed or
repaid prior to the Maturity Date (as defined below)). The Corporation will pay interest on such principal sum at the rate of             % per annum3, until payment of such principal sum has been made or duly provided for, semi-annually4 in arrears on                      and
                     of each year (each, an “Interest Payment Date”). Interest shall be payable commencing on the first Interest
Payment Date succeeding the original issue date of this Note, unless the original issue date occurs between a 

	1	This form provides for Notes denominated in, and principal and interest payable in, U.S. dollars. The form, as used, may be modified to provide, alternatively, for
Notes denominated in, and principal and interest and other amounts, if any, payable in a foreign currency or currency unit, with the specific terms and provisions, including any limitations on the issuance of Notes in such currency, additional
provisions regarding paying and other agents and additional provisions regarding the calculation and payment of such currency, set forth therein. 

  

	2	This form provides for Notes that will mature only on a specified date. If the maturity of Notes of a series may be renewed at the option of the holder, or extended
at the option of the Corporation, the form, as used, will be modified to provide for additional terms relating to such renewal or extension, as the case may be, including the period or periods for which the maturity may be renewed or extended, as
the case may be, changes in the interest rate, if any, and requirements for notice. 

  

	3	This form provides for interest at a fixed rate. The form, as used, may be modified to provide, alternatively, for interest at a variable rate or rates, with the
method of determining such rate set forth therein. 

  

	4	This form provides for semi-annual interest payments. The form, as used, may be modified to provide, alternatively, for annual, quarterly, or other periodic interest
payments. 

  

 Regular Record Date (as defined below) and the next Interest Payment Date, in which case interest shall be payable
commencing on the Interest Payment Date following the next Regular Record Date, and shall be payable on each Interest Payment Date, and at Maturity (the “Maturity Date”). A Regular Record Date shall be the close of business on the [last]
[fifteenth] day of the calendar month next preceding an Interest Payment Date. If the Corporation shall default in the payment of interest due on any Interest Payment Date, then this Note shall bear interest from the next preceding Interest Payment
Date to which interest has been paid, or, if no interest has been paid on the Notes, from                     . 
  
 Interest on this Note will accrue from the original issue date of this Note
until the principal amount is paid or duly provided for. Interest (including payments for partial periods) will be computed on the basis of a [360-day year of twelve 30-day months]. Interest payments will equal the amount of interest accrued from,
and including, the preceding Interest Payment Date in respect of which interest has been paid or duly provided for (or from, and including, the original issue date of this Note, if no interest has been paid or duly provided for) to, but excluding,
the Interest Payment Date or the Maturity Date, as the case may be. If the Maturity Date or an Interest Payment Date falls on a day which is not a Business Day, as defined below, principal of or interest payable with respect to such Maturity Date or
Interest Payment Date will be paid on the succeeding Business Day with the same force and effect as if made on such Maturity Date or Interest Payment Date, as the case may be, and no additional interest shall accrue for the period from and after
such Maturity Date or Interest Payment Date, as the case may be. 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 Note (or
one or more predecessor Notes evidencing all or a portion of the same debt as this Note) is registered at the close of business on the record date for such Interest Payment Date. 
  
 The principal of and interest on this Note are payable in immediately available funds in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of public and private debts, at the office or agency of the Corporation designated in the Indenture. However, interest may be paid, at the option of the Corporation, by check
mailed to the person entitled thereto at his address last appearing on the registry books of the Corporation relating to the Notes. Notwithstanding the preceding sentence, payments of principal of and interest payable on the Maturity Date will be
made by wire transfer of immediately available funds to a designated account maintained in the United States upon (i) receipt of written notice by the Issuing and Paying Agent (as described on the reverse hereof) from the registered holder hereof
not less than one Business Day prior to the due date of such principal and (ii) presentation of this Note to the Issuing and Paying Agent, at the Bank of New York, 101 Barclay Street, New York, New York 10286. Any interest not punctually paid or
duly provided for shall be payable as provided in such Indenture.5 [“Business Day” means any weekday that
is not a legal holiday in New York, New York, Charlotte, North Carolina, or any other place of payment with respect to this Note and that is not a day on which banking institutions in those cities are authorized or required by law or regulation to
be closed. “Business 

	5	This form does not contemplate the offer of Notes to United States Aliens (for United States federal income tax purposes). If Notes are offered to United States
Aliens, the form of Note, as used, may be modified to provide for the payment of additional amounts to such United States Aliens or, if applicable, the redemption of such Notes in lieu of payment of such additional amounts. 

 

 2 

 Day” also means, with respect to Notes denominated in euro, a day on which the TransEuropean Real-Time
Gross-Settlement Express Transfer, or “TARGET,” System is in place. “Business Day” also means, with respect to Notes denominated in a specified currency other than U.S. dollars or euro, a day on which banking institutions
generally are authorized or obligated by law or regulation, or obligated by executive order to close in the Principal Financial Center of the country of the specified currency. 
  
 “Principal Financial Center” means: 
  
 (1) the capital city of the country issuing the specified currency, except that with respect to U.S. dollars, Australian
dollars, Canadian dollars, South African rand, and Swiss francs, the “Principal Financial Center” is New York, Sydney and Melbourne, Toronto, Johannesburg, and Zurich, respectively, or 
  
 (2) the capital city of the country to which the LIBOR currency relates,
except that with respect to U.S. dollars, Australian dollars, Canadian dollars, South African rand, and Swiss francs, the “Principal Financial Center” is New York, Sydney, Toronto, Johannesburg, and Zurich, respectively.] 
  
 References herein to “U.S. dollars,” “U.S.$,” or
“$” are to the coin or currency of the United States at the time of payment is legal tender for the payment of public and private debts. 
  
 Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth at
this place. 
  
 Unless the certificate of authentication hereon
has been executed by the Trustee or by an authenticating agent on behalf of the Trustee by manual signature, this Note shall not be entitled to any benefit under such Indenture or be valid or obligatory for any purpose. 
  

 3 

 IN WITNESS WHEREOF, the Corporation has caused this Note to be duly executed, by manual or facsimile
signature, under its corporate seal or a facsimile thereof. 
  

			
	BANK OF AMERICA CORPORATION
		
	By:	 	 
	 	 	

	 Title: Senior Vice President

  

			
	 [SEAL]

	
	 ATTEST:

		
	By:	 	 
	 	 	

	 	 	 Assistant Secretary

  

 4 

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

			
	 THE BANK OF NEW YORK,

	 as Trustee

		
	By:	 	 
	 	 	

	 	 	 Authorized Signatory

  

 5 

 [Reverse of Note] 
  

BANK OF AMERICA CORPORATION 
             % SENIOR NOTE, DUE                      
  
 SECTION 1. General. This Note is one of a duly authorized series of
Securities of the Corporation unlimited in aggregate principal amount (herein called the “Notes”) issued and to be issued under an Indenture dated as of January 1, 1995 (herein called the “Indenture”), between the Corporation
(successor in interest to NationsBank Corporation) and The Bank of New York, as Trustee (successor in interest to U.S. Bank Trust National Association, successor trustee to BankAmerica National Trust Company, herein called the “Trustee,”
which term includes any successor trustee under the Indenture), as supplemented by a First Supplemental Indenture dated as of September 18, 1998 and a Second Supplemental Indenture dated as of May 7, 2001 to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective rights thereunder of the Corporation, the Trustee, and the holders of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered. The
series of which this Note is a part also is designated as the Corporation’s             % Senior Notes, due
                     (herein called the “Notes”), initially in the principal amount of
$                            . [The amount of Notes of this series may be increased by the Corporation
in the future.] The Trustee initially shall act as Security Registrar, Transfer Agent, and Issuing and Paying Agent in connection with the Notes. 
  
 SECTION 2. No Sinking Fund. This Note is not subject to any sinking fund. 
  
 SECTION 3. Redemption and Repayment. Except in those situations in which the Corporation may become obligated to pay
additional amounts (as described herein), the Notes of this series are not subject to redemption at the option of the Corporation or repayment at the option of the holder prior to maturity.6 
  
 SECTION 4. Defeasance. The provisions of Article Fourteen of the Indenture do [not] apply to Securities of this Series. 
  

SECTION 5. Payment of Additional Amounts. [Subject to the exemptions and limitations set forth below, the Corporation will pay additional
amounts to the beneficial owner of this Note that is a “Non-United States person,” as defined below, in order to ensure that every net payment on such Note will not be less, due to payment of United States withholding tax, than the amount
then due and payable. For this purpose, a “net payment” on the Note means a payment by the Corporation or any paying agent, including payment of principal and interest, after deduction for any present or future tax, assessment, or other
governmental charge of the United States. These additional amounts will constitute additional interest on the Note. 

	6	This form provides for Notes that are not subject to redemption at the option of the Corporation or repayment at the option of the holder. The form, as used, may be
modified to provide, alternatively, for redemption at the option of the Corporation or repayment at the option of the holder, with the terms and conditions of such redemption or repayment, as the case may be, including provisions regarding sinking
funds, if applicable, redemption prices, and notice periods, set forth therein. 

  

 6 

 The Corporation will not be required to pay additional amounts, however, in any of the circumstances
described in items (1) through (13) below. 
  
 (1) Additional
amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the Note: 
  

	 	(a)	having a relationship with the United States as a citizen, resident, or otherwise; 

  

	 	(b)	having had such a relationship in the past; or 

  

	 	(c)	being considered as having had such a relationship. 

  
 (2) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge that is
imposed or withheld solely by reason of the beneficial owner of the Note: 
  

	 	(a)	being treated as present in or engaged in a trade or business in the United States; 

  

	 	(b)	being treated as having been present in or engaged in a trade or business in the United States in the past; 

  

	 	(c)	having or having had a permanent establishment in the United States; or 

  

	 	(d)	having or having had a qualified business unit which has the U.S. dollar as its functional currency. 

  
 (3) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other
governmental charge that is imposed or withheld solely by reason of the beneficial owner of the Note being or having been a: 
  

	 	(a)	personal holding company; 

  

	 	(b)	foreign personal holding company; 

  

	 	(c)	foreign private foundation or other foreign tax-exempt organization; 

  

	 	(d)	passive foreign investment company; 

  

	 	(e)	controlled foreign corporation; or 

  

	 	(f)	corporation which has accumulated earnings to avoid United States federal income tax. 

  
 (4) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other
governmental charge that is imposed or withheld solely by reason of the beneficial owner of the Note owning or having owned, actually or constructively, 10% or more of the total combined voting power of all classes of the Corporation’s stock
entitled to vote; 
  

 7 

 (5) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the Note being a bank extending credit pursuant to a loan agreement entered into in the ordinary course of business. 
  
 For purposes of items (1) through (5) above, “beneficial owner”
includes a fiduciary, settlor, partner, member, shareholder, or beneficiary of the holder if the holder is an estate, trust, partnership, limited liability company, corporation, or other entity, or a person holding a power over an estate or trust
administered by a fiduciary holder. 
  
 (6) Additional amounts
will not be payable to any beneficial owner of the Note that is: 
  

	 	(a)	a fiduciary; 

  

	 	(b)	a partnership; 

  

	 	(c)	a limited liability company; 

  

	 	(d)	another fiscally transparent entity; or 

  

	 	(e)	not the sole beneficial owner of the Note, or any portion of the Note. 

  
 However, this exception to the obligation to pay additional amounts will only apply to the extent that a beneficiary or settlor in relation to the
fiduciary, or a beneficial owner, partner or member of the partnership, limited liability company, or other fiscally transparent entity, would not have been entitled to the payment of an additional amount had the beneficiary, settlor, partner,
beneficial owner, or member received directly its beneficial or distributive share of the payment. 
  
 (7) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge that is
imposed or withheld by reason of the failure of the beneficial owner of the Note or any other person to comply with applicable certification, identification, documentation or other information reporting requirements. This exception to the obligation
to pay additional amounts will apply only if compliance with such reporting requirements is required as a precondition to exemption from such tax, assessment or other governmental charge by statute or regulation of the United States or by an
applicable income tax treaty to which the United States is a party. 
  
 (8) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge that is collected or imposed by any method other than by withholding from a payment on the Note
by the Corporation or any paying agent. 
  
 (9) Additional amounts
will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge that is imposed or withheld by reason of a change in law, regulation, or administrative or judicial interpretation that becomes
effective 

  

 8 

 
more than 15 days after the payment becomes due or is duly provided for, whichever occurs later. 
  
 (10) Additional amounts will not be payable if a payment on the Note is
reduced as a result of any tax, assessment, or other governmental charge that is imposed or withheld by reason of the presentation by the beneficial owner of the Note for payment more than 30 days after the date on which such payment becomes due or
is duly provided for, whichever occurs later. 
  
 (11) Additional
amounts will not be payable if a payment on the Note is reduced as result of any: 
  

	 	(a)	estate tax; 

  

	 	(b)	inheritance tax; 

  

	 	(c)	gift tax; 

  

	 	(d)	sales tax; 

  

	 	(e)	excise tax; 

  

	 	(f)	transfer tax; 

  

	 	(g)	wealth tax; 

  

	 	(h)	personal property tax; or 

  

	 	(i)	any similar tax, assessment, or other governmental charge. 

  
 (12) Additional amounts will not be payable if a payment on the Note is reduced as a result of any tax, assessment, or other governmental charge required
to be withheld by any paying agent from a payment of principal or interest on the Note if such payment can be made without such withholding by any other paying agent. 
  
 (13) Additional amounts will not be payable if a payment on the Note is reduced as a result of any combination of items (1)
through (12) above. 
  
 A “United States person” means:

  
 (a) any individual who is a citizen or resident of the United
States; 
  
 (b) any corporation, partnership, or other entity
created or organized in or under the laws of the United States; 
  
 (c) any estate if the income of such estate falls within the federal income tax jurisdiction of the United States regardless of the source of such income; and 
  

 9 

 (d) any trust if a U.S. court is able to exercise primary supervision over its administration and one or
more United States persons have the authority to control all of the substantial decisions of the trust. 
  
 A “Non-United States person” means a person who is not a United States person, and “United States” means the United States of America,
including the States and the District of Columbia, its territories, its possessions, and other areas within its jurisdiction.] 
  
 SECTION 6. Redemption for Tax Reasons. [The Notes of this series may be redeemed at the option of the Corporation in whole, but not in part, at any
time, on giving not less than 30 nor more than 60 days’ notice to the Trustee and the holders of the Notes, if the Corporation has or may become obliged to pay additional amounts as a result of any change in, or amendment to, the laws or
regulations of the United States or any political subdivision or any authority thereof or therein having power to tax, or any change in the application or official interpretation of such laws or regulations after the date of this Note. 

 
 Prior to the publication of any notice of redemption, the Corporation
shall deliver to the Trustee a certificate signed by the Chief Financial Officer or a Senior Vice President of the Corporation stating that the Corporation is entitled to effect such redemption and setting forth a statement of facts showing the
conditions precedent to the right to redeem. 
  
 Notes so redeemed
will be redeemed at 100% of their principal amount together with interest accrued up to (but excluding) the date of redemption.] 
  
 SECTION 7. Events of Default. If an Event of Default (defined in the Indenture as (a) the Corporation’s default in the payment of the
principal of (or premium, if any, on) the Notes; (b) the Corporation’s default in the payment of interest on the Notes within 30 calendar days after the same becomes due; (c) the Corporation’s breach of its other covenants contained in
this Note or in the Indenture, which breach is not cured within 90 calendar days after written notice by the Trustee or the holders of at least 25% in outstanding principal amount of all Securities issued under the Indenture and affected thereby;
and (d) certain events involving the bankruptcy, insolvency or liquidation of the Corporation) shall occur with respect to the Notes, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the
Indenture. 
  
 SECTION 8. Modifications and Waivers. The
Indenture permits, with certain exceptions as therein provided, the amendment of the Indenture and the modification of the rights and obligations of the Corporation and the rights of the holders of the Notes under the Indenture at any time by the
Corporation with the consent of the holders of not less than 66 2/3% in aggregate principal amount of the Notes then outstanding and all other Securities then outstanding under the Indenture and affected by such amendment and modification. The
Indenture also contains provisions permitting the holders of a majority in aggregate principal amount of the Notes then outstanding and all other Securities then outstanding under the Indenture and affected thereby, on behalf of the holders of all
such Securities, to waive compliance by the Corporation 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 Note shall be conclusive and
binding upon such holder and upon all future holders of this Note 

  

 10 

 
and of any Note 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 Note. 
  
 No recourse shall be had for the payment
of the principal of or the interest on this Note, 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, or
director, as such, past, present, or future, of the Corporation or any predecessor or successor corporation, 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 part of the consideration for issue hereof, expressly waived and released. 
  
 SECTION 9. Obligations Unconditional. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair
the obligation of the Corporation, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place, and rate, and in the coin or currency, herein prescribed. 
  
 SECTION 10. Authorized Denominations. The Notes are issuable only as
registered Notes without coupons in the denominations of $                     and any integral multiple in excess thereof. As provided in the
Indenture, and subject to certain limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of different authorized denominations, as requested by the holder surrendering the same. 
  
 SECTION 11. Registration of Transfer. As provided in the Indenture and
subject to certain limitations therein set forth, the transfer of this Note may be registered on the Security Register of the Corporation relating to the Notes, upon surrender of this Note for registration of transfer at the office or agency of the
Corporation designated by it pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Corporation and the Trustee or the Security Registrar duly executed by, the registered holder
hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 
  
 If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by means of a book-entry system with no physical distribution of certificates to be made except as provided in the Indenture. The book-entry system maintained by The
Depository Trust Company (“DTC”) will evidence ownership of the Notes, with transfers of ownership effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered holder of the Notes, as the owner of the Notes for all purposes, including payment of principal (premium, if any) and interest, notices, and voting. Transfer of
principal, premium (if any), interest, and other amounts payable to participants of DTC will be the responsibility of DTC, and transfer of principal (premium, if any) and interest to beneficial owners of the Notes by participants of DTC will be the
responsibility of such participants and other nominees of such beneficial owners. So long as the book-entry system is in effect, the selection of any Notes to be redeemed will be determined by DTC pursuant to rules and procedures established by DTC
and its participants. The Corporation will not be responsible or liable for such transfers or payments or for 

  

 11 

 
maintaining, supervising, or reviewing the records maintained by DTC, its participants, or persons acting through such participants. 
  
 If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes outside of the United States may be effected through the facilities of Clearstream Banking, société anonyme, and Euroclear Bank, S.A./N.V., as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories. 
  
 No service charge will be made for any such registration of transfer or exchange, but the Corporation may require payment of a sum sufficient to cover any tax, assessment, or other governmental charge, including,
without limitation, any withholding tax, payable in connection therewith. 
  
 Prior to due presentment for registration of transfer of this Note, the Corporation, the Trustee, the Issuing and Paying Agent, and any agent of the Corporation may treat the person in whose name this Note is
registered as the owner hereof for all purposes. 
  
 SECTION 12.
Authentication Date. The Notes of this series shall be dated the date of their authentication. 
  
 SECTION 13. Defined Terms. All terms used in this Note which are not defined herein, but are defined in the Indenture shall have the meanings
assigned to them in the Indenture. 
  
 SECTION 14. Governing
Law. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS. 
  

 12 

 ABBREVIATIONS 
  
 The following abbreviations, when used in the inscription on the face of the within Note shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

			
	 TEN COM—
	  	as tenants in common
	 TEN ENT—
	  	as tenants by the entireties
	 JT TEN—
	  	as joint tenants with right of survivorship and not as tenants in common
	
	 UNIF GIFT MIN
ACT—                    as Custodian
for                    

	                                        
       (Cust)                                
   (Minor)

  
 Under Uniform Gifts to
Minors Act 
  

 (State) 
  
 Additional abbreviations may also be used
though not in the above list. 
  

  
 ASSIGNMENT 
  
 FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto 
  
 [PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS 
 INCLUDING ZIP CODE, OF ASSIGNEE] 
  

  

  

  
 Please Insert Social Security or Other 
 Identifying Number of Assignee:
                             
  
 the within Note and all rights thereunder, hereby irrevocably constituting and appointing
                             Attorney to transfer said Note on the books of the Corporation, with full
power of substitution in the premises. 
  

					
	 Dated:
                    
	 	 	 	

  
 NOTICE: The signature to this
assignment must correspond with the name as it appears upon the face of the within Note in every particular, without alteration or enlargement or any change whatever and must be guaranteed. 
  

 13

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