Document:

exv10w1

Exhibit 10.1

COOPER TIRE & RUBBER COMPANY

CHANGE IN CONTROL SEVERANCE PAY PLAN

(AMENDED AND RESTATED AS OF AUGUST 4, 2010)

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	1. General Statement of Purpose
	 	 	1	 
	2. Definitions
	 	 	1	 
	3. Change in Control: Long-Term Performance-Based Incentive
Compensation and Annual Bonus
	 	 	6	 
	4. Eligibility: Termination Following a Change in Control
	 	 	7	 
	5. Severance and Other Compensation
	 	 	9	 
	6. Funding Upon Potential Change in Control
	 	 	10	 
	7. Reduction of Certain Severance Compensation Payments
	 	 	10	 
	8. No Mitigation Obligation
	 	 	12	 
	9. Certain Payments not Considered for Other Benefits, etc
	 	 	12	 
	10. Confidentiality and Non-Compete Agreement and Release
	 	 	12	 
	11. Legal Fees and Expenses
	 	 	12	 
	12. Employment Rights
	 	 	13	 
	13. Withholding of Taxes
	 	 	13	 
	14. Successors and Binding Effect
	 	 	13	 
	15. Effect of Section 409A of the Code
	 	 	14	 
	16. Governing Law
	 	 	15	 
	17. Validity
	 	 	15	 
	18. Headings
	 	 	15	 
	19. Construction
	 	 	16	 
	20. Administration of the Plan
	 	 	16	 
	21. Amendment and Termination
	 	 	17	 
	22. Other Plans, etc
	 	 	17	 
	Exhibit A Severance Compensation
	 	 	 	 
	Exhibit B Form of Confidentiality and Non-Compete Agreement
	 	 	 	 
	Exhibit C Form of Release
	 	 	 	 

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COOPER TIRE & RUBBER COMPANY

CHANGE IN CONTROL SEVERANCE PAY PLAN

(AMENDED AND RESTATED AS OF AUGUST 4, 2010)

	1.	 	General Statement of Purpose. The Board of Directors (the “Board”) of Cooper Tire &
Rubber Company (the “Company”) has considered the effect a change in control of the Company
may have on certain executives of the Company and its Affiliated Employers (as defined below).
The executives have made and are expected to continue to make major contributions to the
short-term and long-term profitability, growth and financial strength of the Company. The
Company recognizes that, as is the case for most publicly held companies, the possibility of a
change in control exists, desires to assure itself of both the present and future continuity
of management, desires to establish certain minimum severance benefits for certain of its
executives applicable in a change in control, and wishes to insure that its executives are not
practically disabled from discharging their duties in respect of a proposed or actual
transaction involving a change in control.

	 	 	As a result, the Board believes that the Cooper Tire & Rubber Company Change in Control
Severance Pay Plan (the “Plan”) will assist the Company in attracting and retaining
qualified executives. Accordingly, the Plan originally effective as of June 6, 2000 (the
“Effective Date”), as subsequently amended, is amended and restated as of August 4, 2010.

	2.	 	Definitions. Where the following words and phrases appear in the Plan, they shall
have the respective meanings set forth below, unless their context clearly indicates
otherwise:

	 	(a)	 	“Affiliated Employer” means any corporation, partnership, limited liability
company, joint venture, unincorporated association or other entity in which the Company
has a direct or indirect ownership or other equity interest.
	 
	 	(b)	 	“Award Agreement” means an award agreement evidencing a grant of an equity
award between the Executive and the Company.
	 
	 	(c)	 	“Base Pay” means, with respect to each Executive, the rate of annual base
salary payable to the Executive at the time the Executive’s employment is terminated
pursuant to either Section 4(b) or Section 4(c) of this Plan (including a Pre-Change in
Control Qualifying Termination) (without regard to any reduction that would otherwise
constitute Good Reason), or, if greater, the rate of annual base salary payable to the
Executive on the date immediately prior to a Change in Control.
	 
	 	(d)	 	“Board” means the Board of Directors of the Company.
	 
	 	(e)	 	“Cause” means that, prior to any termination of employment pursuant to Section
4(c), the Executive shall have committed:

 

 

	 	(i)	 	any act or omission constituting a material breach by the
Executive of any of his significant obligations to or agreements with the
Company or an Affiliated Employer or the continued failure or refusal of the
Executive to adequately perform the duties reasonably required by the Company
or an Affiliated Employer which, in each case, is materially injurious to the
financial condition or business reputation of, or is otherwise materially
injurious to, the Company or any Affiliated Employer thereof, after
notification by the Board of such breach, failure or refusal and failure of
the Executive to correct such breach, failure or refusal within thirty (30)
days of such notification (other than by reason of the incapacity of the
Executive due to physical or mental illness); or
	 
	 	(ii)	 	any other willful act or omission which is materially
injurious to the financial condition or business reputation of, or is
otherwise materially injurious to, the Company or any Affiliated Employer,
and failure of the Executive to correct such act or omission within thirty
(30) days after notification by the Board of any such act or omission (other
than by reason of the incapacity of the Executive due to physical or mental
illness); or
	 
	 	(iii)	 	the Executive is found guilty of, or pleads guilty or nolo
contendere to, a felony or any criminal act involving fraud, embezzlement, or
theft.

For purposes of this Plan, no act, or failure to act, on the Executive’s part shall be deemed
“willful” if done, or omitted to be done, by the Executive in good faith and with a reasonable
belief that the Executive’s action or omission was in the best interest of the Company or any
Affiliated Employer. Any notification to be given by the Board in accordance with Section 2(e)(i)
or 2(e)(ii) shall be in writing and shall specifically identify the breach, failure, refusal, act
or omission to which the notification relates and, in the case of Section 2(e)(i) or 2(e)(ii) shall
describe the injury to the Company or any Affiliated Employer, and such notification must be given
within twelve (12) months of the Board becoming aware of the breach, failure, refusal, act,
omission or injury identified in the notification. Failure to notify the Executive within any such
twelve (12) month period shall be deemed to be a waiver by the Board of any such breach, failure,
refusal, act or omission by the Executive and any such breach, failure, refusal, act or omission by
the Executive shall not then be determined to be a breach of this Plan. For the avoidance of doubt
and for the purpose of determining Cause, the exercise of business judgment by the Executive shall
not be determined to be Cause, even if such business judgment materially injures the financial
condition or business reputation of, or is otherwise materially injurious to the Company or any
Affiliated Employer, unless such business judgment by the Executive was not made in good faith, or
constitutes willful or wanton misconduct, or was an intentional violation of state or federal law.
In addition, for purposes of this definition of “Cause,” references to an “Affiliated Employer”
shall mean the applicable Affiliated Employer for whom the Executive provides services.

	 	(f)	 	“Change in Control” means the occurrence of any of the following events:

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	 	(i)	 	the Company merges into itself, or is merged or
consolidated with, another entity and as a result of such merger or
consolidation less than 51% of the voting power of the then-outstanding
voting securities of the surviving or resulting entity immediately after such
transaction are directly or indirectly beneficially owned in the aggregate by
the former stockholders of the Company immediately prior to such transaction;
	 
	 	(ii)	 	all or substantially all the assets accounted for on the
consolidated balance sheet of the Company are sold or transferred to one or
more entities or persons, and as a result of such sale or transfer less than
51% of the voting power of the then-outstanding voting securities of such
entity or person immediately after such sale or transfer is directly or
indirectly beneficially held in the aggregate by the stockholders of the
Company immediately prior to such transaction or series of transactions;
	 
	 	(iii)	 	a person, within the meaning of Section 3(a)(9) or
13(d)(3) (as in effect on the Effective Date) of the Securities Exchange Act
of 1934, (the “Exchange Act”) (a “Person”) becomes the beneficial owner (as
defined in Rule 13d-3 of the Securities and Exchange Commission pursuant to
the Exchange Act) (a “Beneficial Owner”) of 35% or more of the voting power
of the then-outstanding voting securities of the Company; provided, however,
that the foregoing does not apply to any such acquisition that is made by (w)
any Affiliated Employer; (x) any employee benefit plan of the Company or any
Affiliated Employer; or (y) any person or group of which employees of the
Company or of any Affiliated Employer control a greater than 25% interest
unless the Board determines that such person or group is making a “hostile
acquisition;” or (z) any person or group that directly or indirectly through
one or more intermediaries, controls or is controlled by, or is under common
control with, the Executive; or
	 
	 	(iv)	 	a majority of the members of the Board are not Continuing
Directors, where a “Continuing Director” is any member of the Board who (x)
was a member of the Board on the Effective Date or (y) was nominated for
election or elected to such Board with the affirmative vote of a majority of
the Continuing Directors who were members of such Board at the time of such
nomination or election, provided that any director appointed or elected to
the Board to avoid or settle a threatened or actual proxy contest (including
but not limited to a consent solicitation) shall in no event be deemed to be
a Continuing Director.

	 	(g)	 	“Code” means the U.S. Internal Revenue Code of 1986 and the rulings and
regulations promulgated thereunder, as such law, rulings, and regulations may be
amended, from time to time.
	 
	 	(h)	 	“Committee” means the Compensation Committee of the Board.

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	 	(i)	 	“Committee Action” means a writing by, or minutes of the actions of, the
Committee, the substance of which, as to an Executive, has been communicated to such
Executive.
	 
	 	(j)	 	“Common Stock” means the Company’s common stock, par value $1.00 per share.
	 
	 	(k)	 	“Company” means the Company as hereinbefore defined.
	 
	 	(l)	 	“Employee Benefits” means the perquisites, benefits and service credit for
benefits as provided under any and all employee retirement income and welfare benefit
policies, plans, programs or arrangements in which an Executive is entitled to
participate, including without limitation any savings, pension, supplemental executive
retirement, or other retirement income or welfare benefit, stock option, performance
share, performance unit, stock purchase, stock appreciation, deferred compensation,
incentive compensation, group or other life, health, medical/hospital or other
insurance (whether funded by actual insurance or self-insured by the Company or any
Affiliated Employer), disability, salary continuation, expense reimbursement and other
employee benefit policies, plans, programs or arrangements that may now exist or any
policies, plans, programs or arrangements that may be adopted hereafter by the Company
or an Affiliated Employer.
	 
	 	(m)	 	“Employer” means the Company and any Affiliated Employer to which the Plan has
been extended by the Board and which has adopted the Plan.
	 
	 	(n)	 	“Executive” means any employee of an Employer who is designated by the
Committee to be eligible under the Plan in a Committee Action and is notified in
writing by the Company of his participation in the Plan (the notification letter
referred to as a “Participation Acknowledgement Letter”).
	 
	 	(o)	 	“Executive’s Multiple” means the number determined by the Committee from time
to time to be identified and provided in the Participation Acknowledgement Letter
provided by the Company to each Executive, such number to be used for calculating a
portion of each Executive’s Severance Pay and benefits.
	 
	 	(p)	 	“Incentive Compensation Plans” means the Cooper Tire & Rubber Company 1998,
2001, 2006 and 2010 Incentive Compensation Plans, as amended, and any successor or
subsequent incentive compensation plan.
	 
	 	(q)	 	“Long-Term Performance-Based Incentive Compensation” or “LTP-BIC” means any
cash or equity-based compensation program and associated dividend equivalent rights
(other than any annual bonus compensation program) in which the amounts paid, earned or
vested are based upon achievement of specified performance goals. For the avoidance of
doubt, equity awards that are earned, vest or become exercisable based solely upon
continued employment and/or the passage of time are not “Long-Term Performance-Based
Incentive Compensation.”

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	 	(r)	 	“Plan” means this Cooper Tire & Rubber Company Change in Control Severance Pay
Plan (amended and restated as of August 4, 2010), as it may be further amended.
	 
	 	(s)	 	“Potential Change in Control” means the occurrence of any of the following
events:

	 	(i)	 	The Company enters into a definitive agreement, the
consummation of which would result in the occurrence of a Change in Control;
	 
	 	(ii)	 	Any Person (other than the Company or any Affiliated
Employer) commences (within the meaning of Regulation 14D promulgated under
the Exchange Act or any successor regulation) a tender or exchange offer
which, if consummated, would result in a Change in Control;
	 
	 	(iii)	 	Any Person (other than the Company or any Affiliated
Employer) files with the Securities and Exchange Commission a preliminary or
definitive proxy statement relating to an election contest with respect to
the election or removal of directors of the Company which solicitation, if
successful, would result in a Change in Control;
	 
	 	(iv)	 	The acquisition by any Person of an aggregate Beneficial
Ownership of 15% or more of the voting power of the then-outstanding voting
securities of the Company (the “Outstanding Company Voting Securities”);
provided, however, that for purposes of this Section
2(s)(iv), the following acquisitions shall not constitute a Potential Change
in Control: (A) any acquisition by the Company or any Affiliated Employer,
(B) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any Affiliated Employer; or (C) any
acquisition by a Person that is permitted to, and actually does, report its
beneficial ownership on Schedule 13G promulgated under the Exchange Act (or
any successor schedule); provided that, if such Person subsequently becomes
required to or does report its beneficial ownership on Schedule 13D
promulgated under the Exchange Act (or any successor schedule), and at the
time has Beneficial Ownership of 15% or more of the Outstanding Company
Voting Securities, then a Potential Change in Control shall be deemed to
occur at such time; or
	 
	 	(v)	 	The Board adopts a resolution to the effect that a
Potential Change in Control has occurred.

	 	(t)	 	“Potential Change in Control Period” means the time period commencing on the
date a Potential Change in Control occurs and ending on the first to occur of (i) the
failure of a Change in Control to occur within six (6)months after the occurrence of a
Potential Change in Control or (ii) delivery to the Trustee under

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	 	 	 	the Trust Agreement (as defined in Section 6) of a declaration by the Board that the
contemplated Change in Control is not likely to occur.
	 
	 	(u)	 	“Severance Compensation” means Severance Pay and other benefits provided by
Section 5(a) of this Plan.
	 
	 	(v)	 	“Severance Pay” means the amounts payable as set forth in Section 5(a) of this
Plan.
	 
	 	(w)	 	“Severance Period” means the period of time commencing on the date of the first
occurrence of a Change in Control and continuing until the earlier of (i) the second
anniversary of the occurrence of the Change in Control; (ii) the Executive’s
death; or (iii) the date the Executive becomes disabled and qualifies, or would have
qualified, to receive disability benefits pursuant to the Company’s long term
disability plan in effect immediately prior to the Change in Control, provided that the
Executive is eligible to participate in such long-term disability plan (regardless of
whether or not the Executive has elected to participate in such long-term disability
plan).
	 
	 	(x)	 	“1998 Option Plan” means the Cooper Tire & Rubber Company 1998 Employee Stock
Option Plan, as amended.

	3.	 	Change in Control: Long-Term Performance-Based Incentive Compensation and Annual
Bonus.

	 	(a)	 	Long-Term Performance-Based Incentive Compensation. Upon the
occurrence of a Change in Control or a Pre-Change in Control Qualifying Termination (as
defined in Section 4(a) below), the Executive shall receive: (i) any outstanding
LTP-BIC award which has been notionally earned by or allocated or awarded to the
Executive for a fiscal year or performance period or other measuring period completed
prior to the date of the Change in Control (or the date of the Pre-Change in Control
Qualifying Termination, if applicable) but has not yet been paid (or settled in the
case of any equity-based awards), based on the achievement of performance goals for
such completed fiscal year, performance period, or other measuring period; and (ii) any
outstanding LTP-BIC award which has not been notionally earned by or allocated or
awarded to the Executive for an uncompleted fiscal year, performance period, or other
measuring period, assuming achievement of performance goals at target level, pro-rated
for the number of full and partial months (on a fractional basis based on the number of
days in the applicable month) between the commencement date of the current uncompleted
fiscal year, performance period or other measuring period and ending on the date of the
Change in Control (or the date of the Pre-Change in Control Qualifying Termination, if
applicable). The foregoing payments to be made upon a Pre-Change in Control Qualifying
Termination are referred to as the “Accelerated Pre-Change in Control Qualifying
Termination LTP-BIC Payment” and the payments to be made upon the occurrence of a
Change in Control are referred to as the “Accelerated Change in Control LTP-BIC
Payment.”

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	 	 	 	The cash-based portion of the Accelerated Change in Control LTP-BIC Payment shall be
paid to the Executive on the 5th day following the Change in Control and
the equity-based portion of the Accelerated Change in Control LTP-BIC Payment shall
be paid to the Executive at the same time (and in the same form) as the Company pays
the per share merger consideration to holders of its Common Stock; provided, that in
each case, any cash or equity-based Accelerated Change in Control LTP-BIC Payment
subject to a prior deferral election shall be paid in accordance with the terms of
such deferral election. The cash and equity-based Accelerated Pre-Change in Control
Qualifying Termination LTP-BIC Payment shall be paid to the Executive in accordance
with Exhibit A.
	 
	 	(b)	 	Annual Bonus Compensation: Upon the occurrence of a Change in Control
or a Pre-Change in Control Qualifying Termination, the Executive shall receive: (i)
any outstanding annual bonus award which has been notionally earned by or allocated or
awarded to the Executive for a fiscal year completed prior to the date of the Change in
Control (or the date of the Pre-Change in Control Qualifying Termination, if
applicable) but has not yet been paid, based on the achievement of performance goals
for such completed fiscal year; and (ii) any outstanding annual bonus award which has
not been notionally earned by or allocated or awarded to the Executive for an
uncompleted fiscal year, performance period, or other measuring period, assuming
achievement of performance goals at target level, pro-rated for the number of full and
partial months (on a fractional basis based on the number of days in the applicable
month) between the commencement date of the current uncompleted fiscal year and ending
on the date of the Change in Control (or the date of the Pre-Change in Control
Qualifying Termination, if applicable). The foregoing payments to be made upon a
Pre-Change in Control Qualifying Termination are referred to as the “Accelerated
Pre-Change in Control Qualifying Termination Annual Bonus Payment” and the payments to
be made upon the occurrence of a Change in Control are referred to as the “Accelerated
Change in Control Annual Bonus Payment.”
	 
	 	 	 	The Accelerated Change in Control Annual Bonus Payment shall be paid to the
Executive on the 5th day following the Change in Control; provided, that
in each case, any Accelerated Change in Control Annual Bonus Payment subject to a
prior deferral election shall be paid in accordance with the terms of such deferral
election. The Accelerated Pre-Change in Control Qualifying Termination Annual Bonus
Payment shall be paid to the Executive in accordance with Exhibit A.

	4.	 	Eligibility: Termination Following a Change in Control.

	 	(a)	 	Subject to Section 3 above and the limitations described below, the Plan
applies to: (i) Executives who are employed on the date that a Change in Control
occurs and (ii) Executives whose employment with the Company is terminated pursuant to
Sections 4(b) or 4(c) at a time when the Company is party to a definitive agreement,
the consummation of which would result in the occurrence of a Change in Control
(whether or not a Change in Control actually occurs) (such

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	 	 	 	termination of employment, a “Pre-Change in Control Qualifying Termination”).
	 
	 	(b)	 	If an Executive’s employment is terminated by an Employer during the Severance
Period and such termination is without Cause, the Executive will be entitled to the
Severance Compensation described in Section 5.
	 
	 	(c)	 	An Executive may, during the Severance Period, terminate his employment with an
Employer with the right to Severance Compensation described in Section 5 upon the
occurrence of one or more of the following events (regardless of whether any other
reason, other than Cause, for such termination exists or has occurred including,
without limitation, other employment) (“Good Reason”):

	 	(i)	 	(A) a significant adverse change in the nature or scope of
the authorities, powers, functions, responsibilities or duties attached to
the position with the Employer which the Executive held immediately prior to
the Change in Control, (B) a material (greater than 5%) reduction in the
Executive’s Base Pay, other than as part of across the board reductions (on a
like percentage basis) applicable at the same time to other Executives and
the executive officers of the ultimate parent, if applicable, or (C) the
termination or denial of the Executive’s rights to Employee Benefits or a
material (greater than 5%) reduction in the scope or aggregate value thereof,
other than as part of a reduction applicable at the same time to executive
officers of the Company and, if applicable, the ultimate parent; or
	 
	 	(ii)	 	the relocation of the office of the Company where the
Executive is employed to a location at least fifty (50) miles from the
Executive’s current work location, except for required travel on the
Company’s business to an extent reasonably required to perform his duties
hereunder; or
	 
	 	(iii)	 	any material breach of its obligations under the Plan by
the Company or any successor thereto.

	 	 	 	Notwithstanding anything in the Plan to the contrary, a termination of employment by
the Executive for one of the reasons set forth in
Sections 4(c)(i) through (iii),
above, will not constitute “Good Reason” unless the Executive provides, within
ninety (90) days of the initial existence of the condition described in Sections
4(c)(i) through (iii), above, written notice to the Company or the applicable
Affiliated Employer of the existence of the condition and the Company has not
remedied such condition within thirty (30) days of the receipt of such notice.
	 
	 	(d)	 	A termination by an Employer pursuant to Subsection (b) of this Section 4 or by
an Executive pursuant to Subsection (c) of this Section 4 will not affect any rights
that the Executive may have pursuant to any agreement, policy, plan, program or

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	 	 	 	arrangement of the Company or an Affiliated Employer providing Employee Benefits,
which rights shall be governed by the terms thereof.
	 
	 	(e)	 	Notwithstanding the preceding provisions of this Section 4, an Executive will
not be entitled to Severance Compensation if his employment with an Employer is
terminated during the Severance Period because the Executive (i) dies or (ii) becomes
disabled and, in the case of disability, qualifies to receive disability benefits
pursuant to the Company’s long term disability plan in effect immediately prior to the
Change in Control, provided that the Executive is eligible to participate in such
long-term disability plan (regardless of whether or not the Executive has elected to
participate in such long-term disability plan), provided, however, that in the case of
Subsection 4(e)(i), in the event an Executive dies following notice of the Executive’s
termination of employment by the Company without Cause or by the Executive for Good
Reason, in either case, during the Severance Period and on or prior to such Executive’s
actual termination of employment, the Executive shall be deemed to have terminated
employment on the date of such notice, and the Executive’s estate shall be entitled to
any Severance Compensation or continuation of Severance Compensation to which the
Executive would otherwise be entitled under this Plan, and the provisions of Section 10
of the Plan shall not apply to the Executive’s estate.

	5.	 	Severance and Other Compensation.

	 	(a)	 	If an Executive’s employment is terminated during the Severance Period pursuant
to Section 4(b) of the Plan or if an Executive terminates his employment during the
Severance Period pursuant to Section 4(c) of the Plan (including, in either case, a
Pre-Change in Control Qualifying Termination), the Company shall pay to the Executive
as Severance Pay the amounts described on Exhibit A within the time periods specified
therein, and shall continue to provide to the Executive the other Severance
Compensation described on Exhibit A for the periods described therein. In addition,
the Company shall pay to the Executive (i) any unpaid Base Pay, through the date of the
Executive’s termination, in accordance with the Company’s normal payroll practice; (ii)
for any fiscal year prior to the fiscal year of termination, any unpaid benefits (as
determined by the Committee) payable under each bonus compensation program in which the
Executive participates, in accordance with the Company’s normal payroll practice with
respect to such bonus compensation program but in no event later than March
15th of the year following the year in which termination occurs (or, to the
extent such bonus is subject to a prior deferral election, in accordance with the terms
of such deferral election); and (iii) the benefits the Executive has accrued through
the date of the Executive’s termination under the Company’s Nonqualified Supplementary
Benefit Plan, and any successor plan thereto which provides comparable benefits, in
accordance with the terms of such plan.
	 
	 	(b)	 	Without limiting the rights of an Executive at law or in equity, if the Company
fails to make any payment or provide any benefit required to be made or provided
hereunder on a timely basis, the Company shall pay interest on the amount or

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	 	 	 	value thereof at an annualized rate of interest equal to the so-called composite
“prime rate” as quoted from time to time during the relevant period in The Wall
Street Journal plus the lesser of 5% or the maximum rate of interest allowed by
law (the “Interest Rate”). Such interest will be payable as it accrues on demand.
Any change in such prime rate will be effective on and as of the date of such
change.
	 
	 	(c)	 	Notwithstanding any provision of the Plan to the contrary, the rights and
obligations under this Section 5 and Section 11 will survive any termination or
expiration of the Plan or the termination of an Executive’s employment following a
Change in Control for any reason whatsoever.

	6.	 	Funding Upon Potential Change in Control.

	 	(a)	 	Upon the occurrence of each of a Potential Change in Control or a Change in
Control, the Company shall promptly deposit to the extent it has not done so, and in
any event within five (5) business days of the applicable event, a sum equal to (i) the
present value as of the date of the Potential Change in Control or the Change in
Control, as applicable, of the payments to be made to the Executives under the
provisions of Sections 3 and 5 hereof (other than with respect to options to acquire
shares of Common Stock), plus (ii) the actuarial equivalent of the benefits the
Executives have accrued under the Company’s Nonqualified Supplementary Benefit Plan,
and any successor plan thereto which provides comparable benefits, on the date of the
applicable event, in the Trust under the Cooper Tire & Rubber Company Master
Grantor Trust Agreement, between the Company and National City Bank, as Trustee (the
“Trust Agreement”) or any successor Trustee under the Trust Agreement at the time of
the funding required by this Section 6; provided, however, the Trust shall not be
funded if the funding thereof would result in taxable income to the Executive by reason
of Section 409A(b) of the Code. For purposes of this Section 6, “actuarial equivalent”
shall be determined using the 1994 Uninsured Pensioner Mortality Table (UP-94) and
annual compound interest at the Corporate Bond yield average for bonds rated AAA by
Moody’s reduced by fifty (50) basis points (.5 percent). The rate chosen from such
table will be for the calendar month five months prior to the month which contains the
effective date of payment and will be truncated to the lower 0.25% increment (e.g.
6.00%, 6.25%, 6.50%, etc.).
	 
	 	(b)	 	Any payments of compensation, pension, severance or other benefits by the
Trustee pursuant to the Trust Agreement shall, to the extent thereof, discharge the
Company’s obligation to pay compensation, pension, severance and other benefits
hereunder, it being the intent of the Company that assets in such Trust be held as
security for the Company’s obligation to pay compensation, pension, severance and other
benefits under this Plan. Any similar payments made directly by the Company to an
Executive pursuant to this Plan will relieve the Trustee of the obligation to make such
payments, will relieve the Company of the obligation to fund the Trust to the extent of
such payments, and the Company may seek

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	 	 	 	reimbursement from the Trustee for the payment or other arrangements made directly
by the Company, as provided in the Trust Agreement.
	 
	 	(c)	 	In the event a Change in Control does not occur prior to the end of a Potential
Change in Control Period, the Company may request within six (6) months of the end of
such Potential Change in Control Period that the Trustee pay to the Company any amounts
contributed to and remaining on hand in the Trust pursuant to Section 1(h) of the Trust
Agreement as a result of the occurrence of the Potential Change in Control.

	7.	 	Reduction of Certain Severance Compensation Payments.

	 	(a)	 	Notwithstanding any other provisions in this Plan, in the event that any
payment or benefit received or to be received by an Executive (including any payment or
benefit received in connection with a Change of Control or the termination of the
Executive’s employment, whether pursuant to the terms of this Plan or any other plan,
program, arrangement or agreement) (all such payments and benefits, together the “Total
Payments”) would be subject (in whole or part), to any excise tax imposed under Section
4999 of the Code, or any successor provision thereto (the “Excise Tax”), then, after
taking into account any reduction in the Total Payments provided by reason of Section
280G of the Code in such other plan, program, arrangement or agreement, the Company
will reduce the Executive’s payments and/or benefits under this Plan, to the extent
necessary so that no portion of the Total Payments is subject to the Excise Tax (but in
no event to less than zero); provided, however, that the foregoing reduction shall not
be made if the Total Payments to be provided to the Executive, determined on an
after-tax basis (taking into account the Excise Tax, any tax imposed by any comparable
provision of state law, and any applicable federal, state and local income, OASDI and
Medicare taxes) exceed 110% of the amount calculated without such reduction. In the
event that any payment or benefit intended to be provided hereunder is required to be
reduced pursuant to this Section 7, such payments or benefits will be reduced in the
following order: (i) benefits under Exhibit A, Section l(g) (outplacement services)
which are considered Parachute Payments; (ii) benefits under Exhibit A, Section 1(b)
(lump sum severance) which are considered Parachute Payments; (iii) benefits under
Section 3(b) and/or Exhibit A, Section 1(a) (pro-rated annual bonus compensation) which
are considered Parachute Payments; (iv) benefits under Exhibit A, Section 1(c)
(continued insurance benefits) which are considered Parachute Payments; (v) benefits
under Section 3(a) and/or Exhibit A, Section 1(d) (LTP-BIC compensation) which are
considered Parachute Payments; (vi) benefits under Exhibit A, Section 1(e) (time-vested
restricted stock units) which are considered Parachute Payments; and (vii) benefits
under Exhibit A, Section 1(f) (stock options) which are considered Parachute Payments
(together, the “Potential Payments”).
	 
	 	(b)	 	For purposes of determining whether and the extent to which the Total Payments
will be subject to the Excise Tax: (i) no portion of the Total Payments the receipt or
enjoyment of which the Executive shall have waived at such time and in such

- 11 -

 

	 	 	 	manner as not to constitute a “payment” within the meaning of Section 280G(b) of the
Code shall be taken into account; (ii) no portion of the Total Payments shall be
taken into account which, in the opinion of nationally recognized tax counsel (“Tax
Counsel”) reasonably acceptable to the Executive and selected by the accounting firm
which was, immediately prior to the Change of Control, the Company’s independent
auditor (the “Auditor”), does not constitute a “parachute payment” (“Parachute
Payments”) within the meaning of Section 280G(b)(2) of the Code (including by reason
of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion
of such Total Payments shall be taken into account which, in the opinion of Tax
Counsel, constitutes reasonable compensation for services actually rendered, within
the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as
set forth in Section 280G(b)(3) of the Code) that is allocable to such reasonable
compensation; and (iii) the value of any non-cash benefit or any deferred payment or
benefit included in the Total Payments shall be determined by the Auditor in
accordance with the principles of Sections 280G(d)(3) and (4) of the Code.
	 

	 	(c)	 	At the time that payments are made under this Plan, the Company shall provide
the Executive with a written statement setting forth the manner in which such payments
were calculated and the basis for such calculations, including any opinions or other
advice the Company received from Tax Counsel, the Auditor, or other advisors or
consultants (and any such opinions or advice which are in writing shall be attached to
the statement). If the Executive objects to the Company’s calculations based on an
opinion or other advice the Executive received from his Tax Counsel or other advisors
or consultants (and any such opinions or advice which are in writing shall be provided
by the Executive to the Company), the Company shall pay to the Executive such portion
of the Potential Payments (up to 100% thereof) as the Executive determines is necessary
to result in the proper application of this Section 7. All determinations required by
this Section 7 (or requested by either the Executive or the Company in connection with
this Section 7) shall be at the expense of the Company. The fact that the Executive’s
right to payments or benefits may be reduced by reason of the limitations contained in
this Section 7 shall not of itself limit or otherwise affect any other rights of the
Executive under this Plan.

	8.	 	No Mitigation Obligation. The Company hereby acknowledges that it will be difficult
and may be impossible for an Executive to find reasonably comparable employment following his
termination of employment with the Company and the Affiliated Employers and that the
non-competition agreement required by Section 10 will further limit the employment
opportunities for an Executive. Accordingly, the provision of Severance Compensation by the
Company to an Executive in accordance with the terms of the Plan is hereby acknowledged by the
Company to be reasonable, and an Executive will not be required to mitigate the amount of any
payment provided for in the Plan by seeking other employment or otherwise, nor will any
profits, income, earnings or other benefits from any source whatsoever create any mitigation,
offset, reduction or any other obligation on the part of an Executive hereunder or otherwise,
except as expressly provided in Section l(c) of Exhibit A.

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	9.	 	Certain Payments not Considered for Other Benefits, etc. The legal fee and expense
reimbursement provided under Section 11 and reimbursements for outplacement counseling
provided under Section l(g) of Exhibit A will not be included as earnings for the purpose of
calculating contributions or benefits under any employee benefit plan of the Company.
	 
	10.	 	Confidentiality and Non-Compete Agreement and Release. Receipt of Severance
Compensation by an Executive is conditioned upon the Executive executing and delivering to the
Company a Confidentiality and Non-Compete Agreement substantially in the form provided in
Exhibit B and a Release substantially in the form provided in Exhibit C.
	 
	11.	 	Legal Fees and Expenses. It is the intent of the Company that the Executive not be
required to incur legal fees and the related expenses associated with the interpretation,
enforcement or defense of the Executive’s rights under the Plan by litigation or otherwise
because the cost and expense thereof would substantially detract from the benefits intended to
be extended to the Executive hereunder. Accordingly, if it should appear to the Executive that
the Company has failed to comply with any of its obligations under the Plan or in the event
that the Company or any other person takes or threatens to take any action to declare the Plan
void or unenforceable, or institutes any litigation or other action or proceeding designed to
deny, or to recover from, the Executive the benefits provided or intended to be provided to
the Executive hereunder, the Company irrevocably authorizes the Executive from time to time to
retain counsel of the Executive’s choice, at the expense of the Company as hereafter provided,
to advise and represent the Executive in connection with any such interpretation, enforcement
or defense. Notwithstanding any existing or prior attorney-client relationship between the
Company and such counsel, the Company irrevocably consents to the Executive’s entering into an
attorney-client relationship with such counsel, and in that connection the Company and the
Executive agree that a confidential relationship shall exist between the Executive and such
counsel. The Company shall pay and be solely financially responsible for any and all
reasonable fees and related expenses incurred by the Executive in connection with any of the
foregoing, and any reimbursement to the Executive hereunder will be made as soon as practical
but in no event no later than the end of the calendar year following the year in which the
legal fees and expenses are paid by the Executive. Notwithstanding the above, the Company
shall not be obligated to reimburse or pay Executive for attorney fees and related expenses
hereunder in the event any one or more of the following shall occur: (i) the Executive fails
to prevail in at least one asserted claim; (ii) a court of competent jurisdiction determines
that the Executive acted in bad faith, frivolously or with no colorable claim; or (iii) a
court of competent jurisdiction determines that the Executive asserted a claim in violation of
the Release.
	 
	12.	 	Employment Rights.

	 	(a)	 	Nothing expressed or implied in the Plan shall create any right or duty on the
part of the Company, an Affiliated Employer or an Executive to have the Executive
remain in the employment of the Company or an Affiliated Employer at any time prior to
or following a Change in Control.

- 13 -

 

	 	(b)	 	Each Executive covered by this Plan expressly acknowledges that he is an
employee at will, and that the Company may terminate him at any time prior to a Change
in Control.

	13.	 	Withholding of Taxes. The Company may withhold from any amounts payable under the
Plan all federal, state, city or other taxes as shall be required pursuant to any law or
government regulation or ruling.
	 
	14.	 	Successors and Binding Effect.

	 	(a)	 	The Company will require any successor, (including without limitation any
persons acquiring directly or indirectly all or substantially all of the business
and/or assets of the Company, or any specific group of the Company as designated by the
Board, and to the extent of any delegation of the Board to a committee, by such
committee, whether by purchase, merger, consolidation, reorganization or otherwise, and
such successor shall thereafter be deemed the Company and an Employer for the purposes
of the Plan), to expressly assume and agree to perform the obligations under the Plan
in the same manner and to the same extent the Company and an Employer would be required
to perform if no such succession had taken place. The Plan shall be binding upon and
inure to the benefit of the Company and any successor to the Company, but shall not
otherwise be assignable, transferable or delegable by the Company.
	 
	 	(b)	 	The rights under the Plan shall inure to the benefit of and be enforceable by
each Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees and/or legatees.
	 
	 	(c)	 	The rights under the Plan are personal in nature and neither the Company nor
any Executive shall, without the consent of the other, assign, transfer or delegate the
Plan or any rights or obligations hereunder except as expressly provided in this
Section 14. Without limiting the generality of the foregoing, an Executive’s right to
receive payments hereunder shall not be assignable, transferable or delegable, whether
by pledge, creation of a security interest or otherwise, other than by a transfer by
his or her will or by the laws of descent and distribution and, in the event of any
attempted assignment or transfer contrary to this Section 14, the Company shall have no
liability to pay any amount so attempted to be assigned, transferred or delegated.
	 
	 	(d)	 	The obligation of the Company to make payments and/or provide benefits
hereunder shall represent an unsecured obligation of the Company.
	 
	 	(e)	 	The Company recognizes that each Executive will have no adequate remedy at law
for breach by the Company of any of the agreements contained herein and, in the event
of any such breach, the Company hereby agrees and consents that each Executive shall be
entitled to a decree of specific performance, mandamus or other appropriate remedy to
enforce performance of obligations of the Company under the Plan.

- 14 -

 

	15.	 	Effect of Section 409A of the Code.

	 	(a)	 	Notwithstanding anything to the contrary in the Plan, a termination of
employment shall not be deemed to have occurred for purposes of any provision providing
for payment upon or following a termination of an Executive’s employment unless such
termination is also a “Separation from Service” within the meaning of Section 409A of
the Code and, for purposes of any such provision, references to a “termination,”
“termination of employment” or like terms shall mean Separation from Service, and
references to the “termination date,” “date of termination” or like terms shall mean
the date of Separation from Service.
	 
	 	(b)	 	Notwithstanding anything to the contrary in the Plan, if the Executive is a
“specified employee” (within the meaning of Section 409A of the Code and determined
pursuant to policies adopted by the Company) and the Company determines that any
payments or taxable benefits to be provided to the Executive pursuant to Sections 5 and
11 of the Plan are or may become subject to the additional tax under Section
409A(a)(l)(B) of the Code or any other taxes or penalties imposed under Section 409A of
the Code (the “409A Taxes”) as applicable at the time such payments and benefits are
otherwise required under the Plan unless payment is delayed for at least six (6) months
following the date of the Executive’s “separation from service” (as such term is
defined under Section 409A of the Code) with the Company, then:

	 	(i)	 	(A) such payments shall be delayed until the date that is
six months after the date of the Executive’s “separation from service” (as
such term is defined under Section 409A of the Code) with the Company, or for
shorter period of time that the Company determines is sufficient to avoid
the imposition of the 409A Taxes (the “Payments Delay Period”), and (B)
such payments shall be increased by an amount equal to interest on such
payments for the Payments Delay Period at the Interest Rate; and
	 
	 	(ii)	 	(A) with respect to the provision of such taxable benefits,
for a period of six months following the date of the Executive’s “separation
from service” (as such term is defined under Section 409A of the Code) with
the Company, or for shorter period of time that the Company determines is
sufficient to avoid the imposition of the 409A Taxes (the “Benefits Delay
Period”), the Executive shall be responsible for the full cost of securing
such taxable benefits, and (B) on the first day following the Benefits Delay
Period, the Company shall reimburse the Executive for the costs of providing
such benefits imposed on the Executive during the Benefits Delay Period, plus
interest accrued at the Interest Rate.

	16.	 	Governing Law. All matters affecting this Plan, including the validity,
interpretation, construction and performance of the Plan shall be governed by the laws of the
State of Ohio, without giving effect to the principles of conflict of laws of such State.

- 15 -

 

	17.	 	Validity. If any provisions of the Plan or the application of any provision hereof
to any person or circumstance is held invalid, unenforceable or otherwise illegal, the
remainder of the Plan and the application of such provision to any other person or
circumstances shall not be affected, and the provision so held to be invalid, unenforceable or
otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make
it enforceable, valid and legal.
	 
	18.	 	Headings. The headings in the Plan are for convenience of reference only and do not
define, limit or describe the scope or intent of the Plan or any part hereof and shall not be
considered in any construction hereof.
	 
	19.	 	Construction. The masculine gender, where appearing in the Plan, shall be deemed to
include the feminine gender and the singular shall be deemed to include the plural, unless the
context clearly indicates to the contrary.
	 
	20.	 	Administration of the Plan.

	 	(a)	 	In General: The Plan shall be administered by the Company, which shall
be the named fiduciary under the Plan.
	 
	 	(b)	 	Delegation of Duties: The Company may delegate any of its
administrative duties, including, without limitation, duties with respect to the
processing, review, investigation, approval and payment of Severance Pay, to named
administrator or administrators.
	 
	 	(c)	 	Regulations: The Company shall promulgate any rules and regulations it
deems necessary in order to carry out the purposes of the Plan or to interpret the
terms and conditions of the Plan; provided, however, that no rule, regulation or
interpretation shall be contrary to the provisions of the Plan.
	 
	 	(d)	 	Claims Procedure: Subject to the provisions of Section 7, the Company
shall determine the rights of any employee of the Company to any Severance
Compensation. Any employee or former employee of the Company or an Affiliated Employer
who believes that he has not received any benefit under the Plan to which he believes
he is entitled, may file a claim in writing with the General Counsel of the Company.
The Company shall, no later than 90 days after the receipt of a claim, either allow or
deny the claim by written notice to the claimant. If a claimant does not receive
written notice of the Company’s decision on his claim within such 90-day period, the
claim shall be deemed to have been denied in full.

A denial of a claim by the Company, wholly or partially, shall be written in a manner calculated to
be understood by the claimant and shall include:

	 	(i)	 	the specific reason or reasons for the denial;
	 
	 	(ii)	 	specific reference to pertinent Plan provisions on which
the denial is based;

- 16 -

 

	 	(iii)	 	a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of why
such material or information is necessary; and
	 
	 	(iv)	 	an explanation of the claim review procedure.

A claimant whose claim is denied (or his duly authorized representative) may, within thirty (30)
days after receipt of denial of his claim, request a review of such denial by the Company by filing
with the Secretary of the Company a written request for review of his claim. If the claimant does
not file a request for review with the Company within such 30-day period, the claimant shall be
deemed to have acquiesced in the original decision of the Company on his claim. If a written
request for review is so filed within such 30-day period, the Company shall conduct a full and fair
review of such claim. During such full review, the claimant shall be given the opportunity to
review documents that are pertinent to his claim and to submit issues and comments in writing. The
Company shall notify the claimant of its decision on review within sixty (60) days after receipt of
a request for review. Notice of the decision on review shall be in writing. If the decision on
review is not furnished to the claimant within such 60-day period, the claim shall be deemed to
have been denied on review.

	 	(e)	 	Requirement of Receipt: Upon receipt of any Severance Compensation
hereunder, the Company reserves the right to require any Executive to execute a receipt
evidencing the amount and payment of such Severance Compensation.

	21.	 	Amendment and Termination. The Board reserves the right, except as hereinafter
provided, at any time and from time to time, to amend, modify, change or terminate the Plan
and/or any Committee Action, including any Exhibit thereto; provided, however, that during the
pendency of a Potential Change in Control and after the occurrence of a Change in Control any
such amendment, modification, change or termination that adversely affects the rights of any
Executive under the Plan may not be made without the written consent of any such Executive.
	 
	22.	 	Other Plans, etc. If the terms of this Plan are inconsistent with the provisions of
any other plan, program, contract or arrangement of the Company or any Affiliated Employer,
to the extent such plan, program, contract or arrangement may be amended by the Company or an
Affiliated Employer, the terms of the Plan will be deemed to so amend such plan, program,
contract or arrangement, and the terms of the Plan will govern.

          IN WITNESS WHEREOF, Cooper Tire & Rubber Company has caused the Plan to be executed as of the
4th day of August 2010.

- 17 -

 

	 	 	 	 	 
	 	COOPER TIRE & RUBBER COMPANY

 	 
	 	By:  	/s/ Brenda S. Harmon 	 
	 	 	Brenda S. Harmon 	 
	 	 	Senior Vice President

Chief Human Resources Officer 	 
	 

- 18 -

 

EXHIBIT A

COOPER TIRE & RUBBER COMPANY

CHANGE IN CONTROL SEVERANCE PAY PLAN

Severance Compensation

	1.	 	Severance Pay. Except as otherwise provided in this Exhibit A, each Executive whose
employment is terminated during the Severance Period pursuant to Section 4(b) or Section 4(c)
of the Plan (including a Pre-Change in Control Qualifying Termination) shall, subject to and
conditioned upon compliance with Section 15 of the Plan and Section 2 of this Exhibit A,
receive Severance Compensation from the Company as follows:

	 	(a)	 	Pro-Rated Annual Bonus Compensation:

	 	(i)	 	With respect to an Executive who experiences a Pre-Change
in Control Qualifying Termination, the Company shall pay to the Executive the
Accelerated Pre-Change in Control Qualifying Termination Annual Bonus Payment
on the 31st day following the date of the Executive’s Pre-Change in Control
Qualifying Termination; provided however, that any Accelerated Pre-Change in
Control Qualifying Termination Annual Bonus Payment subject to a prior
deferral election shall be paid in accordance with the terms of such deferral
election;
	 
	 	(ii)	 	With respect to an Executive who does not experience a
Pre-Change in Control Qualifying Termination, a single lump sum cash payment
on the 31st day following the Executive’s termination of
employment equal to an amount determined by multiplying the Executive’s
target annual bonus amount by a fraction, the numerator of which is the
number of full and partial months (on a fractional basis based on the number
of days in the applicable month) from the beginning of the performance period
(that commences after the Change in Control) to the date of termination and
the denominator of which is 12 (or such other number of months in the
applicable performance period) (the “Pro Rated Annual Bonus”); provided, that
if such Pro Rated Annual Bonus is subject to a prior deferral election, the
Pro Rated Annual Bonus will be paid in accordance with the terms of such
deferral election;

	 	(b)	 	Lump Sum Severance: a single lump sum cash payment on the
31st day following the Executive’s termination of employment equal to the
Executive’s Multiple times the sum of (i) the Executive’s Base Pay plus (ii) the
greater of (A) the Executive’s target annual incentive compensation for the year in
which the Change in Control occurs, and (B) the Executive’s target annual incentive
compensation for the year immediately prior to the Change in Control;

A-1

 

	 	(c)	 	Continued Insurance Benefits: for the number of months determined by
multiplying the Executive’s Multiple times twelve (12) following Executive’s
termination date, the Company shall provide the Executive with life, accident and
health insurance benefits substantially similar to those to which the Executive and
the Executive’s family were entitled immediately prior to Executive’s termination,
provided that, to the extent such health benefits are determined to be taxable by
reason of Section 105(h) of the Code or otherwise, such health coverage shall be
limited to eighteen (18) months following Executive’s termination date, and thereafter
the Company shall provide retiree medical and life insurance coverage to the extent the
Executive is eligible for such benefits under the terms of the applicable plans in
effect immediately prior to Executive’s termination. Benefits otherwise receivable by
the Executive pursuant to this Exhibit A, Section 1(c) shall be reduced to the extent
the Executive is eligible to receive comparable benefits from other employment, and any
such benefits eligibility shall be reported to the Company;
	 
	 	(d)	 	LTP-BIC: With respect to an Executive who experiences a Pre-Change in
Control Qualifying Termination, the Company shall pay to the Executive (or settle in
the case of equity-based awards) the cash and equity-based Accelerated Pre-Change in
Control Qualifying Termination LTP-BIC Payment on the 31st day following the date of
the Executive’s Pre-Change in Control Qualifying Termination; provided, however, with
respect to an Executive that experiences a Pre-Change in Control Qualifying
Termination, if there occurs a Change in Control during the 31-day period following the
date of the Executive’s Pre-Change in Control Qualifying Termination, the Executive
will be entitled to receive the full value of each equity-based Accelerated Pre-Change
in Control Qualifying Termination LTP-BIC Payment award based upon the per share
consideration received by holders of the Common Stock upon the Change in Control,
payable on the 31st day following the Executive’s termination of employment; provided
further, that in each case, any cash or equity-based Accelerated Pre-Change in Control
Qualifying Termination LTP-BIC Payment subject to a prior deferral election shall be
paid in accordance with the terms of such deferral election;
	 
	 	(e)	 	Time-Vested Restricted Stock Units: notwithstanding any provision in
the Plan, this Exhibit A or any Award Agreement between the Executive and the Company
to the contrary,

	 	(i)	 	with respect to an Executive who experiences a Pre-Change
in Control Qualifying Termination, all restricted stock units granted to the
Executive that vest based solely upon the Executive’s continuous employment
with the Company through a stated vesting date, (including dividend
equivalents credited thereon), if then unvested, shall fully vest immediately
upon the Executive’s termination of employment, and if not previously
distributed, on the 31st day following the Executive’s termination
of employment (or, if applicable, in accordance with the terms of any
previously elected deferral election), the Company shall

A-2

 

	 	 	 	deliver to the Executive with respect to each such vested restricted stock
unit one share of Common Stock (or equivalent shares of the acquiring
company’s common stock); provided, however, if there occurs a Change in
Control during such 31-day period, the Executive shall be entitled to
receive the full value of each such vested restricted stock unit based
upon the per share consideration received by holders of the Common Stock
upon the Change in Control, payable on the 31st day following
the Executive’s termination of employment (or, if applicable, in
accordance with the terms of any previously elected deferral election);
	 
	 	(ii)	 	with respect to an Executive who does not experience a
Pre-Change in Control Qualifying Termination,

	 	(A)	 	if upon a Change in Control, the successor to
the Company assumes (expressly or impliedly by operation of law) the
Company’s obligations under any applicable restricted stock unit award
or plan document or issues to the Executive a substitute equity-based
award of equivalent value on no less favorable terms for vesting or
payment as provided under the restricted stock unit award so replaced,
all restricted stock units granted to the Executive that vest based
solely upon the Executive’s continuous employment with the Company
through a stated vesting date, (including dividend equivalents credited
thereon), if then unvested, shall vest and be paid in accordance with
the terms and conditions of such award; provided, however, if the
Executive’s employment is subsequently terminated during the Severance
Period pursuant to Section 4(b) or Section 4(c) of the Plan, all
restricted stock units granted to the Executive that vest based solely
upon the Executive’s continuous employment with the Company through a
stated vesting date, (including dividend equivalents credited thereon),
if then unvested, shall fully vest immediately upon the Executive’s
termination of employment, and if not previously distributed, on the
31st day following the Executive’s termination of employment
(or, if applicable, in accordance with the terms of any previously
elected deferral election), the Company shall deliver to the Executive
with respect to each such vested restricted stock unit one share of
Common Stock (or equivalent shares of the acquiring company’s common
stock);
	 
	 	(B)	 	if upon the Change in Control, the successor to
the Company has not assumed (expressly or impliedly by operation of
law) the Company’s obligations under any applicable restricted stock
unit award or plan document or issued to the Executive a substitute
equity-based award of equivalent value on no less favorable terms for
vesting or payment as provided under the restricted stock unit award so
replaced, all restricted stock units granted to the

A-3

 

	 	 	 	Executive that vest based solely upon the Executive’s continuous
employment with the Company through a stated vesting date, (including
dividend equivalents credited thereon), if then unvested, shall fully
vest immediately upon the consummation of the Change in Control, and
if not previously distributed, the Company shall pay to the Executive
with respect to each such vested restricted stock unit the full value
thereof based upon the per share consideration received by holders of
the Common Stock upon the Change in Control, payable at the same time
as such holders of the Common Stock receive their consideration (or,
if applicable, in accordance with the terms of any previously elected
deferral election);

	 	(f)	 	Stock Options. Notwithstanding any provision in the Plan, this Exhibit
A, the Incentive Compensation Plan, the 1998 Option Plan, any other relevant plan or
program or any Award Agreement between the Company and the Executive to the contrary,

	 	(i)	 	regardless of whether or not the Executive’s employment is
terminated during the Severance Period pursuant to Section 4(b) or 4(c) of
the Plan, if upon a Change in Control, the successor to the Company has not
assumed (expressly or impliedly by operation of law) the Company’s
obligations under the applicable option award or plan document or issued to
the Executive a substitute stock option award of equivalent value on no less
favorable terms for vesting or payment as provided under the stock option
award so replaced, all stock options granted to the Executive by the Company
which have not otherwise vested shall vest immediately upon the consummation
of the Change in Control, and such vested stock options, to the extent that
the shares of Common Stock underlying the stock options remain outstanding,
shall remain exercisable for a period of ninety (90) days following the
Executive’s termination (or such longer period as may be set forth in the
Incentive Compensation Plan, the 1998 Option Plan, other relevant plan or
program, or Award Agreement, as applicable), but not later than the
expiration of the stated option term. In the event that the shares of Common
Stock underlying the stock options do not remain outstanding, on the date
such shares of Common Stock cease to be outstanding, the Company shall pay to
the Executive with respect to each such stock option a lump sum cash payment
equal to the excess of the per share consideration received by holders of the
Common Stock upon the Change in Control over the exercise price of such stock
option;
	 
	 	(ii)	 	with respect to an Executive whose employment is terminated
during the Severance Period pursuant to Section 4(b) or Section 4(c) of the
Plan (other than a Pre-Change in Control Qualifying Termination), if upon a
Change in Control, the successor to the Company assumes (expressly or
impliedly by operation of law) the Company’s obligations

A-4

 

	 	 	 	under the applicable option award or plan document or issues to the
Executive a substitute stock option award of equivalent value on no less
favorable terms for vesting or payment as provided under the stock option
award so replaced, all stock options granted to the Executive by the
Company which have not otherwise vested shall vest immediately upon the
Executive’s termination of employment during the Severance Period pursuant
to Section 4(b) or 4(c) of the Plan, and such vested stock options shall
remain exercisable for a period of ninety (90) days following the
Executive’s termination (or such longer period as may be set forth in the
Incentive Compensation Plan, the 1998 Option Plan, other relevant plan or
program, or Award Agreement, as applicable), but not later than the
expiration of the stated option term;
	 
	 	(iii)	 	with respect to an Executive who experiences a Pre-Change
in Control Qualifying Termination, all stock options granted to the Executive
by the Company which have not otherwise vested shall vest immediately upon
the termination of the Executive’s employment, and such vested stock options,
to the extent that the shares of Common Stock underlying the stock options
remain outstanding, shall remain exercisable for a period of ninety (90) days
following the Executive’s termination (or such longer period as may be set
forth in the Incentive Compensation Plan, the 1998 Option Plan, other
relevant plan or program, or Award Agreement, as applicable), but not later
than the expiration of the stated option term. In the event that the shares
of Common Stock underlying the stock options do not remain outstanding, on
the date such shares of Common Stock cease to be outstanding, the Company
shall pay to the Executive with respect to each such stock option a lump sum
cash payment equal to the excess of the per share consideration received by
holders of the Common Stock upon the Change in Control over the exercise
price of such stock option;

	 	 	 	For purposes hereunder, the term “stock option” should be read to include all other
similar equity instruments, including, but not limited to, stock appreciation
rights;
	 
	 	(g)	 	Outplacement Services: outplacement services by a firm selected by the
Executive from a list provided by the Company so long as such services are commenced
within twelve (12) months following termination, at the expense of the Company in an
amount up to 15% of the Executive’s Base Pay, payable within thirty (30) days after
receipt of an invoice from the outplacement firm.
	 
	 	(h)	 	Notwithstanding anything herein to the contrary, in no event shall amounts in
respect of any restricted stock units, performance-based equity awards or other stock
rights that, as determined by the Company, provides for the “deferral of compensation”
(as such term is defined under Section 409A of the Code), that were granted or became
vested on or after January 1, 2005, be distributed pursuant to Exhibit A prior to the
occurrence of the earlier of either (i) the

A-5

 

	 	 	 	Executive’s termination (or such later date required under Section 15 of the
Plan), (ii) the Executive’s death or “disability” (as such term is defined under
Section 409A of the Code), (iii) a “change in the ownership or effective control” of
the Company or in the “ownership of a substantial portion of the assets” of the
Company (each as defined under Section 409A of the Code), or (iv) the specified time
or fixed schedule as may be elected by the Executive in accordance with the
applicable plan or arrangement and Section 409A of the Code. This provision shall
not apply to any stock options which are not considered deferred compensation
subject to Section 409A of the Code pursuant to Treasury Regulation Section
1.409A-l(b)(5); and
	 
	 	(i)	 	Any cash payment under Section 1(d) or Section 1(e) of this Exhibit A shall be
deemed to be in lieu of and in substitution for any right the Executive may have to
such vested restricted stock units and/or performance-based equity awards, as
applicable, under the terms of any Award Agreement between the Company and the
Executive, and the Executive agrees to surrender all such vested restricted stock units
and/or performance-based equity awards, as applicable, being cashed out hereunder
immediately prior to receiving the cash payment described above. For purposes
hereunder, the term “restricted stock unit” and/or “performance-based equity award”
should be read to include all other similar equity instruments, including, but not
limited to, restricted stock;

	2.	 	Release. Notwithstanding the foregoing, with respect to each Executive whose
employment is terminated during the Severance Period pursuant to Section 4(b) or Section 4(c)
of the Plan (including a Pre-Change in Control Qualifying Termination), as a condition to the
payment of any Severance Compensation pursuant to Section 5(a) of the Plan and Section 1 of
this Exhibit A, within thirty (30) days of the date of the Executive’s termination of
employment, the Executive will be required to deliver to the Company (a) two (2) fully
executed and non-revocable originals of the Release, substantially in the form set forth in
Exhibit C of the Plan, and (b) two (2) fully executed and non-revocable originals of the
Confidentiality and Non-Compete Agreement, substantially in the form set forth in Exhibit B of
the Plan. Failure by the Executive to deliver a valid Release and a valid Confidentiality and
Non-Compete Agreement, each within thirty (30) days of the Executive’s termination of
employment, shall relieve the Company of its obligations under Section 1 of this Exhibit A.

A-6

 

EXHIBIT B

COOPER TIRE & RUBBER COMPANY

CHANGE IN CONTROL SEVERANCE PAY PLAN

Confidentiality and Non-Compete Agreement

WHEREAS, the Executive’s employment has been terminated in accordance with Section 4(b) or (c) of
the Cooper Tire & Rubber Company Change in Control Severance Pay Plan, (amended and restated as of
August 4, 2010 ) (the “Plan”); and

WHEREAS, the Executive is required to sign this Confidentiality and Non-Compete Agreement
(“Agreement”) in order to receive the Severance Compensation and the other benefits described in
the Plan.

NOW THEREFORE, in consideration of the promises and agreements contained herein and other good and
valuable consideration, the sufficiency and receipt of which are hereby acknowledged, and intending
to be legally bound, the Executive agrees as follows:

	1.	 	Effective Date of Agreement. This Agreement is effective on the date set forth below
and will continue in effect as provided herein.
	 
	2.	 	Confidentiality; Confidential Information. In consideration of the payments to be
made and the benefits to be received by the Executive pursuant to the Plan:

	 	(a)	 	The Executive acknowledges and agrees that in the performance of his duties as
an employee of the Cooper Tire & Rubber Company (the “Company”) or an Affiliated
Employer, he was brought into frequent contact with, had access to, and became informed
of confidential and proprietary information of the Company and the Affiliated Employers
and/or information which is a trade secret of the Company and/or an Affiliated
Employer (collectively, “Confidential Information”), as more fully described in
Subsection (b) of this Section. The Executive acknowledges and agrees that the
Confidential Information of the Company and the Affiliated Employers gained by the
Executive during his association with the Company and the Affiliated Employers was
developed by and/or for the Company and the Affiliated Employers through substantial
expenditure of time, effort and money and constitutes valuable and unique property of
the Company and the Affiliated Employers.
	 
	 	(b)	 	The Executive will keep in strict confidence, and will not, directly or
indirectly, at any time, disclose, furnish, disseminate, make available, use or suffer
to be used in any manner any Confidential Information of the Company or an Affiliated
Employer without limitation as to when or how the Executive may have acquired such
Confidential Information. The Executive specifically acknowledges that Confidential
Information includes any and all information, whether reduced to writing (or in a form
from which information can be obtained, translated, or derived into reasonably usable
form), or maintained in the mind or memory of the

B-1

 

	 	 	 	Executive and whether compiled or created by the Company or an Affiliated Employer,
which derives independent economic value from not being readily known to or
ascertainable by proper means by others who can obtain economic value from the
disclosure or use of such information, that reasonable efforts have been put forth
by the Company and the Affiliated Employers to maintain the secrecy of Confidential
Information, that such Confidential Information is and will remain the sole property
of the Company and the Affiliated Employers, and that any retention or use by the
Executive of Confidential Information after the termination of the Executive’s
employment with and services for the Company and the Affiliated Employers shall
constitute a misappropriation of the Company’s Confidential Information.
	 
	 	(c)	 	The Executive further agrees that he shall return, within ten (10) days of the
effective date of his termination as an employee of the Company and the Affiliated
Employers, in good condition, all property of the Company and the Affiliated Employers
then in his possession, including, without limitation, whether in hard copy or in
any other media (i) property, documents and/or all other materials (including copies,
reproductions, summaries and/or analyses) which constitute, refer or relate to
Confidential Information of the Company or an Affiliated Employer, (ii) keys to
property of the Company or an Affiliated Employer, (iii) files and (iv) blueprints or
other drawings.
	 
	 	(d)	 	The Executive further acknowledges and agrees that his obligation of
confidentiality shall survive until and unless such Confidential Information of the
Company or an Affiliated Employer shall have become, through no fault of the Executive,
generally known to the public or the Executive is required by law (after providing the
Company with notice and opportunity to contest such requirement) to make disclosure.
The Executive’s obligations under this Section are in addition to, and not in
limitation or preemption of, all other obligations of confidentiality which the
Executive may have to the Company and the Affiliated Employers under general legal or
equitable principles or statutes.

	3.	 	Non-Compete. The Executive agrees that he will not, without prior Committee Action,
for the period equal to the Executive’s Multiple number of year or years utilized in the
determination of Severance Pay in Section 1(b) of Exhibit A of the Plan (the “Non-Compete
Period”), engage in Competitive Activity, as hereafter defined.
	 
	4.	 	Non-solicitation. The Executive further agrees that he will not, directly or
indirectly, during the Non-Compete Period:

	 	(a)	 	induce or attempt to induce customers, business relations or accounts of the
Company or any of the Affiliated Employers to relinquish their contracts or
relationships with the Company or any of the Affiliated Employers; or
	 
	 	(b)	 	solicit, entice, assist or induce other employees, agents or independent
contractors to leave the employ of the Company or any of the Affiliated Employers or to
terminate their engagements with the Company and/or any of the Affiliated

B-2

 

	 	 	 	Employers or assist any competitors of the Company or any of the Affiliated
Employers in securing the services of such employees, agents or independent
contractors.

	5.	 	Definitions. For purposes of this Agreement, “Competitive Activity” means the
Executive’s participation, without the written consent of any one of the Chairman, Chief
Executive Officer, or Chief Operating Officer, if any, of the Company, in the management of
any business enterprise if such enterprise engages in substantial and direct competition with
the Company or any Affiliated Employer and such enterprise’s sales of any product or service
competitive with any product or service of the Company or any Affiliated Employer amounted to
5% of such enterprise’s net sales for its most recently completed fiscal year and if the
Company’s net sales of said product or service amounted to 5% of, as applicable, the Company’s
or Affiliated Employer’s net sales for its most recently completed fiscal year. “Competitive
Activity” will not include (i) the mere ownership of 5% or more of securities in any such
enterprise and the exercise of rights appurtenant thereto or (ii) participation in the
management of any such enterprise other than in connection with the competitive operations of
such enterprise. Capitalized terms in this Agreement shall have the definitions contained in
the Plan.

          IN WITNESS WHEREOF, the Executive has executed and delivered this Agreement on the date set
forth below.

	 	 	 	 	 	 	 	 
								
	Dated:

	 	 
	 	 
	 	 	
	 

	 	 
	 	 	 	 	
	 

	 	 	 	 	 	[               ]	
	 

	 	 	 	 	 	Executive	

B-3

 

EXHIBIT C

COOPER TIRE & RUBBER COMPANY

CHANGE IN CONTROL SEVERANCE PAY PLAN

Release

          WHEREAS, the Executive’s employment has been terminated in accordance with Section 4(b) or (c)
of the Cooper Tire & Rubber Company Change in Control Severance Pay Plan, (amended and restated as
of August 4, 2010) (the “Plan”); and

          WHEREAS, the Executive is required to sign this Release in order to receive the Severance
Compensation (as such term is defined in the Plan) as described in Exhibit A of the Plan and the
other benefits described in the Plan.

          NOW THEREFORE, in consideration of the promises and agreements contained herein and other good
and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, and
intending to be legally bound, the Executive agrees as follows:

	1.	 	This Release is effective on the date set forth below and will continue in effect as provided
herein.
	 
	2.	 	In consideration of the payments to be made and the benefits to be received by the Executive
pursuant to the Plan, which the Executive acknowledges are in addition to payments and
benefits which the Executive would be entitled to receive absent the Plan, the Executive, for
himself and his dependents, successors, assigns, heirs, executors and administrators (and his
and their legal representatives of every kind), hereby releases, dismisses, remises and
forever discharges Cooper Tire & Rubber Company (“Cooper”), its predecessors, parents,
subsidiaries, divisions, related or affiliated companies, officers, directors, stockholders,
members, employees, heirs, successors, assigns, representatives, agents and counsel (the
“Company”) from any and all arbitrations, claims, including claims for attorney’s fees,
demands, damages, suits, proceedings, actions and/or causes of action of any kind and every
description, whether known or unknown, which Executive now has or may have had for, upon, or
by reason of any cause whatsoever (“claims”), against the Company, including but not limited
to:

	 	(a)	 	any and all claims arising out of or relating to Executive’s employment by or
service with the Company and his termination from the Company;
	 
	 	(b)	 	any and all claims of discrimination, including but not limited to claims of
discrimination on the basis of sex, race, age, national origin, marital status,
religion or handicap, including, specifically, but without limiting the generality of
the foregoing, any claims under the Age Discrimination in Employment Act, as amended,
Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities
Act, Ohio Revised Code Section 4101.17 and Ohio Revised Code Chapter 4112, including
Sections 4112.02 and 4112.99 thereof, and any other applicable state statutes and
regulations; and (c) any and all claims of

C-1

 

	 	 	 	wrongful or unjust discharge or breach of any contract or promise, express or
implied.

provided, however, that the foregoing shall not apply to claims to enforce rights
that Executive may have as of the date hereof or in the future under any of Cooper’s health,
welfare, retirement, pension or incentive plans, under any indemnification agreement between the
Executive and Cooper, under Cooper’s indemnification by-laws, under the directors’ and officers’
liability coverage maintained by Cooper, under the applicable provisions of the Delaware General
Corporation Law, or that Executive may have in the future under the Plan or under this Release.

	3.	 	Executive understands and acknowledges that the Company does not admit any violation of law,
liability or invasion of any of his rights and that any such violation, liability or invasion
is expressly denied. The consideration provided for this Release is made for the purpose of
settling and extinguishing all claims and rights (and every other similar or dissimilar
matter) that Executive ever had or now may have against the Company to the extent provided in
this Release. Executive further agrees and acknowledges that no representations, promises or
inducements have been made by the Company other than as appear in the Plan.
	 
	4.	 	Executive further agrees and acknowledges that:

	 	(a)	 	The release provided for herein releases claims to and including the date of
this Release;
	 
	 	(b)	 	Executive has been advised by the Company to consult with legal counsel prior
to executing this Release, has had an opportunity to consult with and to be advised by
legal counsel of his choice, fully understands the terms of this Release, and enters
into this Release freely, voluntarily and intending to be bound;
	 
	 	(c)	 	Executive has been given a period of twenty-one (21) days to review and
consider the terms of this Release, prior to its execution and that he may use as much
of the twenty-one (21) day period as he desires; and
	 
	 	(d)	 	Executive may, within seven (7) days after execution, revoke this Release.
Revocation shall be made by delivering a written notice of revocation to the General
Counsel at Cooper. For such revocation to be effective, written notice must be
actually received by the General Counsel at Cooper no later than the close of business
on the 7th day after Executive executes this Release. If Executive does exercise his
right to revoke this Release, all of the terms and conditions of the Release shall be
of no force and effect and Cooper shall not have any obligation to make payments or
provide benefits to Executive as set forth in Section 5 of the Plan.

	5.	 	Executive agrees that he will never file a lawsuit or other complaint asserting any claim
that is released in this Release.
	 
	6.	 	Executive waives and releases any claim that he has or may have to reemployment after
____________.

C-2

 

     IN WITNESS WHEREOF, the Executive has executed and delivered this Release on the date set
forth below.

	 	 	 	 	 	 	 

	Dated:
	 	 	 	 	 	 
	 

	 	 

	 	 

[           ]

Executive
	 	 

C-3exv4w1

Exhibit 4.1

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (THE “DEPOSITARY”) (55 WATER STREET, NEW YORK, NEW YORK), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY, AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY, 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.

UNLESS AND UNTIL THIS CERTIFICATE IS EXCHANGED IN WHOLE OR IN PART FOR CERTIFICATES IN DEFINITIVE
REGISTERED FORM, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE (A) BY THE DEPOSITARY TO
A NOMINEE THEREOF OR (B) BY A NOMINEE THEREOF TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR (C) BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR NOMINEE OF
SUCH SUCCESSOR DEPOSITARY.

SEE REVERSE FOR CERTAIN DEFINITIONS

	 	 	 	 	 

	NUMBER

	 	 	$	 
	 
	 	 	 	 
	REGISTERED

	 	CUSIP 651229AK2

ISIN US651229AK27

NEWELL RUBBERMAID INC.

4.70% Notes due 2020

          Newell Rubbermaid Inc., a corporation duly organized and existing under the laws of the State
of Delaware (herein referred to as the “Company”), for value received, hereby promises to pay to
Cede & Co., or registered assigns, the principal sum of           DOLLARS ($ ) on August 15,
2020 and to pay interest, semi-annually in arrears on February 15 and August 15 of each year (each,
an “Interest Payment Date”), commencing February 15, 2011 on said principal sum at the rate of
4.70% per annum, from the most recent Interest Payment Date to which interest has been paid or, if
no interest has been paid, from August 10, 2010, until payment of said principal sum has been made.
The interest so payable on any Interest Payment Date will, subject to certain exceptions provided
in the Indenture referred to on the reverse hereof, be paid to the Person in whose name this
Security is registered at the close of business on the February 1 or August 1, as the case may be
(each, a “Record Date”), next preceding such Interest Payment Date. The amount of interest payable
will be computed on the basis of a 360-day year of twelve 30-day months. The principal of and
interest on this Security are payable 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 Company in the Place of
Payment, and at such other locations as the Company may from time to time designate. Any interest
not punctually paid or duly provided for shall be payable as provided in said Indenture.

          Reference is made to the further provisions of this Security set forth on the reverse hereof.
Such further provisions shall for all purposes have the same effect as though fully set forth at
this place.

          Unless the certificate of authentication hereon has been executed by the Trustee by the manual
signature of one of its authorized officers, this Security shall not be entitled to any benefit
under the Indenture, or be valid or obligatory for any purpose.

[THIS SPACE INTENTIONALLY

LEFT BLANK]

2

 

     IN WITNESS WHEREOF, THE COMPANY HAS CAUSED THIS INSTRUMENT TO BE DULY EXECUTED UNDER ITS
CORPORATE SEAL.

Dated: August 10, 2010

	 	 	 	 	 
	 	NEWELL RUBBERMAID INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Dale L. Metz 	 
	 	 	Title:  	Vice President, Treasurer 	 
	 

	 	 	 	 	 
	[Corporate Seal]

 	 
	Attest:  	 	 
	Name:  	John K. Stipancich 
	Title:  	Corporate Secretary 
	 

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

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

certifies that this is one of the Securities of

the series referred to in the

within-mentioned Indenture.

	 	 	 	 	 
	 	 
	By:  	 	 
	 	 	Authorized Officer 	 

Dated: August 10, 2010

3

 

NEWELL RUBBERMAID INC.

4.70% Notes due 2020

          This Security is one of a duly authorized issue of Securities of the Company designated as its
4.70% Notes due 2020 (Securities of such series being hereinafter called the “Securities”), limited
in initial aggregate principal amount to $      , issued under the senior indenture dated as of November
1, 1995, (hereinafter called the “Indenture”), between the Company (as successor to Newell Co.) and
The Bank of New York Mellon Trust Company, N.A. , formerly known as The Bank of New York Trust
Company, N.A. ( as successor to JPMorgan Chase Bank, formerly The Chase Manhattan Bank (National
Association)), as trustee (the “Trustee”, which term includes any successor trustee under the
Indenture with respect to the Securities of this series), to which Indenture reference is hereby
made for a statement of the respective rights thereunder of the Company, the Trustee and any Holder
of the Securities, and the terms upon which the Securities are, and are to be, authenticated and
delivered.

          Except as otherwise provided in the Indenture, this Security will be issued in global form
only registered in the name of the Depositary or its nominee. This Security will not be issued in
definitive form, except as otherwise provided in the Indenture, and ownership of this Security
shall be maintained in book-entry form by the Depositary for the accounts of participating
organizations of the Depositary.

          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 and
currency, herein prescribed.

          Securities will be redeemable in whole or in part, at the option of the Company at any time
and from time to time prior to maturity (any such date of redemption, the “Redemption Date”), on
not less than 30 or more than 60 days’ notice mailed to Holders thereof, at a redemption price (the
“Redemption Price”) equal to the greater of (a) 100% of the principal amount of the Securities
being redeemed on the Redemption Date and (b) the sum of the present values of the remaining
scheduled payments of principal and interest on the Securities being redeemed on that Redemption
Date (not including any portion of any payments of interest accrued to the Redemption Date),
discounted to the Redemption Date on a semi-annual basis at the Treasury Rate (as defined below),
plus 30 basis points, as determined by a Reference Treasury Dealer (as defined below), plus, in the
case of both (a) and (b) above, accrued and unpaid interest on the Securities being redeemed to the
Redemption Date. Notwithstanding the foregoing, installments of interest on Securities that are
due and payable on Interest Payment Dates falling on or prior to a Redemption Date will be payable
on the Interest Payment Date to the registered Holders as of the close of business on the relevant
regular Record Date. The Redemption Price will be calculated on the basis of a 360-day year
consisting of twelve 30-day months. Once notice of redemption is mailed, the Securities called for
redemption will become due and payable on the Redemption Date and at the Redemption Price, plus
accrued and unpaid interest to the Redemption Date. The Securities will be redeemed in increments
of $1,000 and, if

4

 

redeemed only in part, such that the principal amount that remains outstanding of any security
redeemed only in part equals $2,000 or an integral multiple of $1,000 in excess thereof .

          “Treasury Rate” means, with respect to any Redemption Date, the rate per year equal to the
semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date.

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

          “Comparable Treasury Price” means, with respect to any Redemption Date, (a) the average of the
Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (b) if the Company obtains fewer than three
such Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer
Quotations, or (c) if only one Reference Treasury Dealer Quotation is received, such Quotation.

          “Reference Treasury Dealer” means (a) Goldman, Sachs & Co. (or any affiliate of Goldman, Sachs
& Co. that is a Primary Treasury Dealer) and their respective successors, provided, however, that
if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York
City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury
Dealer, and (b) any other Primary Treasury Dealer(s) selected by the Trustee after consultation
with the Company.

          “Reference Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Company, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m. (New York City
time) on the third business day preceding such Redemption Date.

          On and after the Redemption Date, interest will cease to accrue on the Securities, or any
portion of the Securities, called for redemption (unless the Company defaults in the payment of the
Redemption Price and accrued interest). On or before the Redemption Date, the Company will deposit
with a Paying Agent (or the Trustee) money sufficient to pay the Redemption Price of and accrued
interest on the Securities to be redeemed on such date. If less than all the Securities are to be
redeemed, the Securities to be redeemed shall be selected by lot by DTC or, if the Securities are
not represented by a global security, by such method as the Trustee shall deem fair and
appropriate.

          If a Change of Control Triggering Event occurs with respect to the Securities, unless the
Company has exercised its option to redeem the Securities as described above, the Company will be
required to make an offer (a “Change of Control Offer”) to each Holder of Securities to repurchase
all of that Holder’s Securities or any part of that Holder’s Securities

5

 

such that the principal amount that remains outstanding of any Security not repurchased in
full equals $2,000 or an integral multiple of $1,000 in excess thereof. In a Change of Control
Offer, the Company will be required to offer payment in cash equal to 101% of the aggregate
principal amount of the Securities repurchased, plus accrued and unpaid interest, if any, on the
Securities repurchased to the date of repurchase (a “Change of Control Payment”).

          Within 30 days following any Change of Control Triggering Event or, at the Company’s option,
prior to any Change of Control, but after public announcement of the transaction that constitutes
or may constitute the Change of Control, a notice will be mailed to Holders of the Securities
describing the transaction that constitutes or may constitute the Change of Control Triggering
Event and offering to repurchase such Securities on the date specified in the notice, which date
will be no earlier than 30 days and no later than 60 days from the date such notice is mailed (a
“Change of Control Payment Date”). The notice will, if mailed prior to the date of consummation of
the Change of Control, state that the Change of Control Offer is conditioned on the Change of
Control Triggering Event occurring on or prior to the Change of Control Payment Date.

          In order to accept the Change of Control Offer, the Holder must deliver to the Paying Agent,
at least three Business Days prior to the Change of Control Payment Date, this Security together
with the form entitled “Election Form” (which form is annexed hereto) duly completed, or a
telegram, telex, facsimile transmission or a letter from a member of a national securities
exchange, or the Financial Industry Regulatory Authority, Inc. or a commercial bank or trust
company in the United States setting forth:

	 	(i)	 	the name of the Holder of this Security;
	 
	 	(ii)	 	the principal amount of this Security;
	 
	 	(iii)	 	the principal amount of this Security to be repurchased;
	 
	 	(iv)	 	the certificate number or a description of the tenor and terms
of this Security;
	 
	 	(v)	 	a statement that the Holder is accepting the Change of Control
Offer; and
	 
	 	(vi)	 	a guarantee that this Security, together with the form entitled
“Election Form” duly completed, will be received by the Paying Agent at least
three Business Days prior to the Change of Control Payment Date.

Any exercise by a Holder of its election to accept the Change of Control Offer shall be
irrevocable. The Change of Control Offer may be accepted for less than the entire principal amount
of this Security, but in that event the principal amount of this Security remaining outstanding
after repurchase must be equal to $2,000 or an integral multiple of $1,000 in excess thereof.

          Upon the Change of Control Payment Date, the Company will, to the extent lawful: (a) accept
for payment all Securities or portions of Securities properly tendered and not withdrawn pursuant
to the Change of Control Offer; (b) deposit with the Paying Agent an

6

 

amount equal to the Change of Control Payment in respect of all Securities or portions of the
Securities properly tendered; and (c) deliver or cause to be delivered to the Trustee the
Securities properly accepted together with an Officers’ Certificate stating the aggregate principal
amount of Securities or portions of Securities being repurchased.

          The Company will not be required to make a Change of Control Offer upon the occurrence of a
Change of Control Triggering Event if a third party makes such an offer in the manner, at the times
and otherwise in compliance with the requirements for an offer made by the Company and the third
party repurchases all Securities properly tendered and not withdrawn under its offer. In addition,
the Company will not repurchase any Securities if there has occurred and is continuing on the
Change of Control Payment Date an Event of Default under the Indenture, other than a Default in the
payment of the Change of Control Payment upon a Change of Control Triggering Event.

          The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), and any other securities laws and regulations thereunder
to the extent those laws and regulations are applicable in connection with the repurchase of the
Securities as a result of a Change of Control Triggering Event. To the extent that the provisions
of any securities laws or regulations conflict with the Change of Control Offer provisions
contained herein, the Company will comply with those securities laws and regulations and will not
be deemed to have breached its obligations under the Change of Control Offer provisions contained
herein by virtue of any such conflict.

          For purposes of the Change of Control Offer provisions, the following terms will be
applicable:

          “Change of Control” means the occurrence of any of the following: (1) the direct or indirect
sale, lease, transfer, conveyance or other disposition (other than by way of merger or
consolidation), in one or more series of related transactions, of all or substantially all of the
Company’s assets and the assets of its subsidiaries, taken as a whole, to any person, other than
the Company or one of its subsidiaries; (2) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any person becomes the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of more than 50% of the Company’s outstanding Voting Stock or other Voting Stock into
which the Company’s Voting Stock is reclassified, consolidated, exchanged or changed measured by
voting power rather than number of shares; (3) the Company consolidates with, or merges with or
into, any person, or any person consolidates with, or merges with or into, the Company, in any such
event pursuant to a transaction in which any of the Company’s outstanding Voting Stock or the
Voting Stock of such other person is converted into or exchanged for cash, securities or other
property, other than any such transaction where the shares of the Company’s Voting Stock
outstanding immediately prior to such transaction constitute, or are converted into or exchanged
for, a majority of the Voting Stock of the surviving person or any direct or indirect parent
company of the surviving person, immediately after giving effect to such transaction; (4) the first
day on which a majority of the members of the Company’s Board of Directors are not Continuing
Directors; or (5) the adoption of a plan relating to the Company’s liquidation or dissolution.

7

 

          Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control
under clause (2) above if (i) the Company becomes a direct or indirect wholly-owned subsidiary of a
holding company and (ii)(A) the direct or indirect holders of the Voting Stock of such holding
company immediately following that transaction are substantially the same as the holders of the
Company’s Voting Stock immediately prior to that transaction or (B) immediately following that
transaction no person (other than a holding company satisfying the requirements of this sentence)
is the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of such
holding company. The term “person,” as used in this definition, has the meaning given thereto in
Section 13(d)(3) of the Exchange Act.

          “Change of Control Triggering Event” means the occurrence of both a Change of Control and a
Rating Event.

          “Continuing Directors” means, as of any date of determination, any member of the Company’s
Board of Directors who (1) was a member of such Board of Directors on the date the Securities were
issued or (2) was nominated for election, elected or appointed to such Board of Directors with the
approval of a majority of the Continuing Directors who were members of such Board of Directors at
the time of such nomination, election or appointment (either by a specific vote or by approval of
the Company’s proxy statement in which such member was named as a nominee for election as a
director, without objection to such nomination).

          “Fitch” means Fitch Inc., and its successors.

          “Investment Grade Rating” means a rating equal to or higher than BBB- (or the equivalent) by
Fitch, a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and a rating equal to
or higher than BBB- (or the equivalent) by S&P, and a rating equal to or higher than the equivalent
investment grade credit rating from any replacement Rating Agency or Rating Agencies selected by
the Company.

          “Moody’s” means Moody’s Investors Service, Inc., a subsidiary of Moody’s Corporation, and its
successors.

          “Rating Agencies” means (1) each of Fitch, Moody’s and S&P and (2) if any of Fitch, Moody’s or
S&P ceases to rate the Securities or fails to make a rating of the Securities publicly available
for reasons outside of the Company’s control, a “nationally recognized statistical rating
organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the
Company (as certified by a resolution of the Company’s Board of Directors) as a replacement agency
for Fitch, Moody’s or S&P, or all of them, as the case may be.

          “Rating Event” means, that on any day during the period (the “Trigger Period”) commencing 60
days prior to the first public announcement by the Company of any Change of Control (or pending
Change of Control) and ending 60 days following consummation of such Change of Control (which
Trigger Period will be extended following consummation of a Change of Control for so long as any of
the Rating Agencies has publicly announced that it is considering a possible ratings change), the
Securities cease to have an Investment Grade Rating from at least two of the three Rating Agencies.
Unless at least two of the three Rating Agencies are providing a rating for the Securities at the
commencement of any Trigger Period, the

8

 

Securities will be deemed to have ceased to have an Investment Grade Rating from at least two
of the three Rating Agencies during that Trigger Period.

          “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and its successors.

          “Voting Stock” means, with respect to any specified “person” (as that term is used in Section
13(d)(3) of the Exchange Act) as of any date, the capital stock of such person that is at the time
entitled to vote generally in the election of the board of directors of such person.

          As provided in the Indenture and subject to certain limitations therein set forth, this
Security may be registered for transfer on the Security Register of the Company, upon surrender of
this Security for registration of transfer at the office or agency of the Company in the Place of
Payment, and at such other locations as the Company may from time to time designate, 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 the Holder’s attorney duly authorized in
writing, and thereupon one or more new Securities, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or transferees.

          The Securities are issuable only as Registered Securities without coupons in the denominations
of $2,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture, and
subject to certain limitations therein set forth, Securities are exchangeable for a like aggregate
principal amount of Securities of different authorized denominations, as requested by the Holder
surrendering the same.

          No service charge will be made for any such registration of 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 for registration of transfer of this Security, the Company, the
Trustee, the Security Registrar, the Paying Agent and any agent of any one thereof 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, the Security Registrar, the
Paying Agent nor any such agent shall be affected by notice to the contrary.

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

          If an Event of Default, as defined in the Indenture, with respect to the Securities shall
occur, the principal of all the Securities may be declared due and payable in the manner and with
the effect provided in the Indenture.

9

 

          The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company with respect to the Securities and
the rights of the Holders of the Securities under the Indenture at any time by the Company with the
consent of the Holders of not less than a majority in aggregate principal amount of the Securities
at the time Outstanding. The Indenture also contains provisions permitting the Holders of not less
than a majority in principal amount of the Securities at the time Outstanding, on behalf of the
Holders of all the Securities, 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 a notation of such consent or waiver is
made upon this Security.

          No recourse shall be had for the payment of the principal of or the interest on this Security,
or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or any 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 the issue hereof, expressly waived and released.

          The Company at its option, subject to the terms and conditions contained in the Indenture, (a)
will be discharged from any and all obligations in respect of the Securities (except for certain
obligations to register the transfer and exchange of such Securities, to replace mutilated,
destroyed, lost or stolen Securities, to compensate, reimburse and indemnify the Trustee, to
maintain an office or agency with respect to the Securities and to hold moneys for payment in
trust) or (b) may omit to comply with certain restrictive covenants contained in the Indenture, in
each case upon irrevocable deposit with the Trustee in trust of money or U.S. government securities
(as described in the Indenture) or a combination thereof, which through the payment of interest and
principal in respect thereof in accordance with their terms will provide money in an amount
sufficient to discharge the principal of and interest on such Securities on the Stated Maturity of
such principal or interest.

          This Security shall be governed and construed in accordance with the internal laws of the
State of New York, without regard to its conflicts of law principles.

          Except as otherwise defined herein, all terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

          Customary abbreviations may be used in the name of a Holder of Securities or an assignee, such
as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with
right of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift
to Minors Act). Additional abbreviations may also be used though not in the above list.

10

 

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

      

      

PLEASE INSERT SOCIAL SECURITY

OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

          
                   
                   
                   
             

 

 

 

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

the within Security and all rights thereunder, and hereby irrevocably constitutes and appoints

 

Attorney to transfer said Security on the books of the Company, with full power of substitution in
the premises.

Dated:                                                             

	 	 	 

	 

	 	 
	 

	 	 
	 

	 	NOTICE: The signature to this
	 

	 	assignment must correspond with
	 

	 	the name as written upon the
	 

	 	face of the within instrument
	 

	 	in every particular, without
	 

	 	alteration or enlargement or
	 

	 	any change whatever.

 

 

 

ELECTION FORM

TO BE COMPLETED ONLY IF THE HOLDER

ELECTS TO ACCEPT THE CHANGE OF CONTROL OFFER

 

     The undersigned hereby irrevocably requests and instructs the Company to repurchase the within
Security (or the portion thereof specified below), pursuant to its terms, on the Change of Control
Payment Date specified in the Change of Control Offer, for the Change of Control Payment specified
in the within Security, to the undersigned,                                         , at                                                                                 (please
print or typewrite name and address of the undersigned).

     For this election to accept the Change of Control Offer to be effective, the Company must
receive, at the address of the Paying Agent set forth below or at such other place or places of
which the Company shall from time to time notify the Holder of the within Security, either (i) the
within Security with this “Election Form” form duly completed, or (ii) a telegram, telex, facsimile
transmission or a letter from a member of a national securities exchange or the Financial Industry
Regulatory Authority, Inc. or a commercial bank or a trust company in the United States setting
forth (a) the name of the Holder of the Security, (b) the principal amount of the Security, (c) the
principal amount of the Security to be repurchased, (d) the certificate number or description of
the tenor and terms of the Security, (e) a statement that the option to elect repurchase is being
exercised, and (f) a guarantee stating that the Security to be repurchased, together with this
“Election Form” duly completed will be received by the Paying Agent three Business Days prior to
the Change of Control Payment Date. The address of the Paying Agent is The Bank of New York Mellon
Trust Company, N.A., c/o The Bank of New York Mellon, 101 Barclay Street, New York, New York 10286.

     If less than the entire principal amount of the within Security is to be repurchased, specify
the portion thereof (which principal amount must be an integral multiple of $1,000 and such that
the principal amount not being repurchased is $2,000 or an integral multiple of $1,000 in excess
thereof) which the Holder elects to have repurchased: $                                        .

2

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