Document:

Exhibit 10.4

ETFS
PRECIOUS METALS BASKET TRUST

MARKETING AGENT AGREEMENT

MARKETING AGENT AGREEMENT
(the “Agreement”) made as of October 18, 2010, on behalf of ETFS Precious
Metals Basket Trust, a New York trust (the “Fund” or the “Trust”), by and among
ETFS Marketing, LLC, a Delaware limited liability company, as agent of the Fund
(“ETFS Marketing”) and ALPS Distributors, Inc., a Colorado corporation (the
“Marketing Agent”). Capitalized terms used
but not defined in this Agreement shall have the meaning ascribed thereto in
the Trust’s Prospectus included its Registration Statement on Form S-1
(Registration No. 333-164769), as it may be amended from time-to-time.

W I T N E S S E T H:

WHEREAS, ETF Securities
USA LLC, as sponsor of the Trust (the “Sponsor”), on behalf of the Fund, has
filed with the Securities and Exchange Commission (the “Commission” or “SEC”) a
registration statement on Form S-1 (Registration No. 333-164769) and amendments thereto, including as part thereof a
prospectus (the “Prospectus”), under the Securities Act of 1933, as amended
(the “1933 Act”), the forms of which have heretofore been delivered to the
Marketing Agent; and

WHEREAS, ETFS Marketing
has been engaged to provide marketing services in the United States; and

WHEREAS,
the Trust and ETFS Marketing wish to employ the Marketing Agent in connection
with the performance of the services listed in Schedule A and additional
services as may be agreed from time-to-time; 

NOW,
THEREFORE, in consideration of the mutual promises and undertakings herein
contained, the parties agree as follows:

1.
Registration — ETFS Marketing has furnished or will furnish, upon request, the
Marketing Agent with copies of the Trust’s trust agreement, custodian
agreements, transfer agency agreement, current prospectus, and all forms
relating to any plan, program or service offered by the Trust. ETFS Marketing
shall furnish, within a reasonable time period, to the Marketing Agent a copy
of any amendment or supplement to any of the above-mentioned documents. Upon request,
ETFS Marketing shall furnish promptly to the Marketing Agent any additional
documents necessary or advisable to perform its functions hereunder. As used in
this Agreement the terms “registration statement,” “prospectus” shall mean any
registration statement and prospectus filed by the Trust with the SEC and any
amendments and supplements thereto that are filed with the SEC.

2. Representations
and Warranties of ETFS Marketing – ETFS Marketing represents and warrants
and covenants the following:

(a) ETFS Marketing has
been duly organized and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware, with full power and
authority to conduct its business as described in the Registration Statement
and the Prospectus, and has all requisite power and authority to execute and
deliver this Agreement;

(b) the Fund and ETFS
Marketing are duly qualified and are in good standing in each jurisdiction
where the conduct of its business requires such qualification; and 

(d) this Agreement has
been duly authorized, executed and delivered by ETFS Marketing and constitutes
the valid and binding obligations of ETFS Marketing, enforceable against ETFS
Marketing in accordance with its terms.

3. Representations and
Warranties of the Marketing Agent - The Marketing Agent represents and warrants and covenants the
following: 

(a) The Marketing Agent is registered as a broker-dealer under the
Exchange Act, and is a member in good standing of the Financial Industry
Regulatory Authority (“FINRA”) and is qualified to act as a broker or dealer in
the states or other jurisdictions where the nature of its business so requires;
and has all other necessary licenses, authorizations, consents and
approvals and has made all necessary filings required under any federal, state,
local or foreign law, regulation or rule, and has obtained all necessary
authorizations, consents and approvals from other Persons, in order to conduct
its activities as contemplated by this Agreement. The Marketing Agent will maintain
any such registrations, qualifications and membership in good standing and in
full force and effect throughout the term of this Agreement. The Marketing
Agent will comply with all applicable federal laws, including but not limited
to, federal securities and commodities laws, the laws of the states or other
jurisdictions concerned, and the rules and regulations promulgated thereunder,
and with the Constitution, By-Laws and Conduct Rules of FINRA; 

(b) The Marketing Agent
(i) has been duly organized and is validly existing as a corporation in good
standing under the laws of the State of Colorado, with full power and authority
to conduct its business and has all requisite power and authority to execute
and deliver this Agreement and (ii) is duly qualified and is in good standing
in each jurisdiction where the conduct of its business requires such
qualification; and

(c) This Agreement has
been duly authorized, executed and delivered by the Marketing Agent and
constitutes the valid and binding obligations of the Marketing Agent,
enforceable against the Marketing Agent in accordance with its terms.

4. Fees
and Trust Expenses — (a) In consideration of the services to be performed
by the Marketing Agent hereunder as set forth on Schedule A attached hereto and
as it may be amended from time-to-time, ETFS Marketing will pay the Marketing
Agent an annual fee in the amount of $20,000 per annum to be paid in 1/12 equal
monthly installments commencing on launch date of the Trust, subject to any
limitation imposed by any law, rule or regulation applicable to any of the
parties hereto. The maximum compensation Marketing Agent may receive under this
Agreement, as a result of the Trust’s offering, is estimated to be $115,635,
which includes $60,000 (fees) and $55,635 (expenses). The Trust is not
responsible for the payment of any amounts to the Marketing Agent. The maximum
compensation that will be paid for wholesaling salaries, as a result of this
offering, is estimated to be $236,250, which is solely the responsibility of
ETFS Marketing.

(b)
ETFS Marketing shall reimburse the Marketing Agent for any reasonable
fees or disbursements incurred by the Marketing Agent in connection with the
performance by the Marketing Agent of its duties under and pursuant to this
Agreement including, but not limited to, the items identified as Out of Pocket
Expenses in Schedule B of this agreement. These fees shall not exceed $55,635
for the three-year period beginning from the date of this agreement. Further, unless otherwise agreed to by the parties hereto
in writing, the Marketing Agent shall not be responsible for fees and expenses
in connection with (a) filing of any registration statement, printing and the
distribution of any prospectus under the 1933 Act and amendments prepared for
use in connection with the offering of shares for sale to the public,
preparing, setting in type, printing and mailing the prospectus, and any
supplements thereto sent to shareholders of the Trust, (b) preparing, setting
in type, printing and mailing any report (including annual and semi-

2

annual
reports) or other communication to shareholders of the Trust, and (c) the Blue
Sky registration and qualification of shares of the Trust for sale in the
various states in which the officers of the Trust shall determine it advisable
to qualify such shares of the Trust for sale (including registering the Trust
as a broker or dealer or any officer of the Trust or any Trust as agent or
salesman in any state). 

5. Use
of the Marketing Agent’s Name — Neither the Trust nor ETFS Marketing, or
any of their affiliates, shall use the name of the Marketing Agent, or any of
its affiliates, in any prospectus, sales literature, and other material
relating to the Trust in any manner without the prior written consent of the
Marketing Agent (which shall not be unreasonably withheld); provided, however,
that the Marketing Agent hereby approves all lawful uses of the names of the
Marketing Agent and its affiliates in the prospectus of the Trust and in all
other materials which merely refer to accurate terms to their appointment
hereunder or which are required by the SEC, FINRA, OCC or any state securities
authority.

6. Use
of the Trust’s Name — Neither the Marketing Agent nor any of its affiliates
shall use the name of the Trust in any publicly disseminated materials,
including sales literature in any manner without the prior consent of ETFS
Marketing (which shall not be unreasonably withheld); provided, however,
that ETFS Marketing hereby approves all lawful uses of its or the Trust’s names
in any required regulatory filings of the Marketing Agent which merely refer in
accurate terms to the appointment of the Marketing Agent hereunder, or which
are required by the SEC, FINRA, or any state securities authority.

7. Indemnification of Marketing Agent
- ETFS Marketing agrees to indemnify, defend and hold harmless the Marketing
Agent, its partners, stockholders, members, directors, officers and employees
of the foregoing, and the successors and assigns of all of the foregoing, from
and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which the Marketing Agent or any such person
may incur under the 1933 Act, the Securities Exchange Act of 1934 (the
“Exchange Act”), the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon:

	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 any untrue statement or
 alleged untrue statement of a material fact contained in the Registration
 Statement (or in the Registration Statement as amended or supplemented) or in
 a Prospectus (the term Prospectus being deemed to include the Prospectus and
 the Prospectus as amended or supplemented), or arises out of or is based upon
 any omission or alleged omission to state a material fact required to be stated
 in either such Registration Statement or such Prospectus or necessary to make
 the statements made therein not misleading, except for any statements
 provided in writing, directly or indirectly through ETFS Marketing, by the
 Marketing Agent to the Sponsor for inclusion in such Registration Statement
 or such prospectus or any material omissions therefrom; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any untrue statement or
 alleged untrue statement of a material fact or breach by ETFS Marketing of
 any representation or warranty contained in this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 the failure by ETFS
 Marketing to perform when and as required any agreement or covenant contained
 herein;

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 any untrue statement of
 any material fact contained in any audio or visual materials provided by ETFS
 Marketing or based upon written information furnished by or on behalf of ETFS
 Marketing including, without limitation, slides, videos, films or tape
 recordings used in connection with the marketing of the Trust;

 
	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 the Marketing Agent’s
 performance of its duties under this Agreement except in the case of this
 clause (e), for any loss, damage, expense, liability or claim resulting from
 the gross 

 

3

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 negligence or willful
 misconduct of the Marketing Agent. In no case is the indemnity of ETFS
 Marketing in favor of the Marketing Agent deemed to protect the Marketing
 Agent against any liability to ETFS Marketing to which the Marketing Agent
 would otherwise be subject by reason of willful misfeasance, bad faith or
 gross negligence in the performance of its duties or by reason of its
 reckless disregard of its obligations and duties under this Agreement.

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 If any action, suit or
 proceeding (each, a “Proceeding”) is brought against the Marketing Agent in
 respect of which indemnity may be sought against ETFS Marketing pursuant to
 the foregoing paragraph, the Marketing Agent shall promptly notify ETFS
 Marketing in writing of the institution of such Proceeding and ETFS Marketing
 shall assume the defense of such Proceeding, including the employment of
 counsel reasonably satisfactory to such indemnified party and payment of all
 fees and expenses; provided, however, that the omission to so notify ETFS
 Marketing shall not relieve ETFS Marketing from any liability which it may
 have to the Marketing Agent hereunder except to the extent that it has been
 materially prejudiced by such failure. The Marketing Agent shall have the
 right to employ its or their own counsel in any such case, but the fees and
 expenses of such counsel shall be at the expense of the Marketing Agent unless
 the employment of such counsel shall have been authorized in writing by ETFS
 Marketing in connection with the defense of such Proceeding or ETFS Marketing
 shall not have, within a reasonable period of time in light of the
 circumstances, employed counsel to have charge of the defense of such
 Proceeding or such indemnified party or parties shall have reasonably
 concluded that there may be defenses available to it or them which are
 different from, additional to or in conflict with those available to ETFS Marketing
 (in which case ETFS Marketing shall not have the right to direct the defense
 of such Proceeding on behalf of the indemnified party or parties), in any of
 which events such fees and expenses shall be borne by ETFS Marketing and paid
 as incurred (it being understood, however, that ETFS Marketing shall not be
 liable for the expenses of more than one separate counsel (in addition to any
 local counsel) in any one Proceeding or series of related Proceedings in the
 same jurisdiction representing the indemnified parties who are parties to
 such Proceeding).

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 ETFS Marketing shall
 not be liable for any settlement of any Proceeding effected without ETFS
 Marketing’s written consent, but if settled with ETFS Marketing’s written
 consent, ETFS Marketing agrees to indemnify and hold harmless the Marketing
 Agent from and against any loss or liability by reason of such settlement.
 Notwithstanding the foregoing sentence, if at any time an indemnified party
 shall have requested an indemnifying party to reimburse the indemnified party
 for fees and expenses of counsel as contemplated by the second sentence of
 the foregoing paragraph, then the indemnifying party agrees that it shall be
 liable for any settlement of any Proceeding effected without its written
 consent if (i) such settlement is entered into more than 60 Business Days
 after receipt by such indemnifying party of the aforesaid request, (ii) such
 indemnifying party shall not have fully reimbursed the indemnified party in
 accordance with such request prior to the date of such settlement and (iii)
 such indemnified party shall have given the indemnifying party at least 30
 Business Days’ prior notice of its intention to settle. No indemnifying party
 shall, without the prior written consent of the indemnified party, effect any
 settlement of any pending or threatened Proceeding in respect of which any
 indemnified party is or could have been a party and indemnity could have been
 sought hereunder by such indemnified party, unless such settlement includes
 an unconditional release of such indemnified party from all liability on
 claims that are the subject matter of such Proceeding and does not include an
 admission of fault, culpability or a failure to act, by or on behalf of such
 indemnified party.

 

4

8. Indemnification of ETFS Marketing and the
Trust - The Marketing
Agent agrees to indemnify, defend and hold harmless ETFS Marketing and the
Trust, their partners, shareholders, members, directors, officers and employees
of the foregoing, and the controlling persons of all of the foregoing, within
the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act,
and the successors and assigns of all of the foregoing, from and against any
loss, damage, expense, liability or claim (including the reasonable cost of investigation)
which ETFS Marketing may incur under the 1933 Act, the Exchange Act, the common
law or otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact contained in and in conformity with information furnished in
writing, directly or indirectly through ETFS Marketing, by or on behalf of the
Marketing Agent to the Sponsor expressly for use in the Registration Statement
(or in the Registration Statement as amended or supplemented by any
post-effective amendment thereof) or in a Prospectus, or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in such Registration
Statement or such Prospectus or necessary to make such information not
misleading.

The Marketing Agent will
also indemnify ETFS Marketing and the Trust as stated above insofar as such
loss, damage, expense, liability or claim arises out of or is based upon the
Marketing Agent’s performance of its duties under this Agreement, except in the
case of any loss, damage, expense, liability or claim resulting from the gross
negligence or willful misconduct of ETFS Marketing or the Trust. In no case is the
indemnity of the Marketing Agent in favor of ETFS Marketing and the Trust to be
deemed to protect ETFS Marketing and the Trust against any liability to the
Marketing Agent to which ETFS Marketing or the Trust would otherwise be subject
by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of its reckless disregard of ETFS
Marketing’s obligations and duties under this Agreement.

If any Proceeding is
brought against ETFS Marketing or the Trust in respect of which indemnity may
be sought against the Marketing Agent pursuant to the first paragraph of this
Section 8, ETFS Marketing shall promptly notify the Marketing Agent in writing
of the institution of such Proceeding and the Marketing Agent shall assume the
defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify the Marketing Agent shall not
relieve the Marketing Agent from any liability hereunder which it may have to
ETFS Marketing except to the extent that it has been materially prejudiced by
such failure. ETFS Marketing and the Trust shall have the right to employ their
own counsel in any such case, but the fees and expenses of such counsel shall
be at the expense of ETFS Marketing unless the employment of such counsel shall
have been authorized in writing by the Marketing Agent in connection with the
defense of such Proceeding or the Marketing Agent shall not have, within a
reasonable period of time in light of the circumstances, employed counsel to
defend such Proceeding or such indemnified party or parties shall have
reasonably concluded that there may be defenses available to it or them which
are different from or additional to or in conflict with those available to the
Marketing Agent (in which case the Marketing Agent shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party or
parties, but the Marketing Agent may employ counsel and participate in the
defense thereof but the fees and expenses of such counsel shall be at the
expense of the Marketing Agent), in any of which events such fees and expenses
shall be borne by the Marketing Agent and paid as incurred (it being
understood, however, that the Marketing Agent shall not be liable for the
expenses of more than one separate counsel (in addition to any local counsel)
in any one Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). 

The Marketing Agent shall
not be liable for any settlement of any such Proceeding effected without the
written consent of the Marketing Agent but if settled with the written consent
of the Marketing Agent, the Marketing Agent agrees to indemnify and hold
harmless ETFS Marketing and the Trust from and against any loss or liability by
reason of such settlement. Notwithstanding the foregoing sentence, if at any
time 

5

an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second sentence of the
foregoing paragraph, then the indemnifying party agrees that it shall be liable
for any settlement of any Proceeding effected without its written consent if
(i) such settlement is entered into more than 60 Business Days after receipt by
such indemnifying party of the aforesaid request, (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement and (iii) such indemnified party shall
have given the indemnifying party at least 30 Business Days’ prior notice of
its intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened Proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding.

9. Term — This Agreement shall become effective as of October 18, 2010, and shall
continue until two years from such date and thereafter shall continue
automatically for successive annual periods, provided that such continuance is
specifically approved at least annually by ETFS Marketing. This Agreement is
terminable without penalty on sixty (60) days’ written notice by ETFS Marketing
or by the Marketing Agent. This Agreement shall automatically terminate in the
event of its assignment.

Upon
the termination of this Agreement, the Marketing Agent, at ETFS Marketing’s
expense and direction, shall transfer to such successor, as ETFS Marketing
shall specify, all relevant books, records and other data established or
maintained by the Marketing Agent under this Agreement.

10.
Notice — Any notice required or permitted to be given by any party to
the other shall be deemed sufficient if sent by (i) telecopier (fax) or (ii)
registered or certified mail, postage prepaid, addressed by the party giving
notice to the other party at the last address furnished by the other party to
the party giving notice:

	
  

 	
  

 
	
  

 	
 if to the Trust or ETFS
 Marketing, at:

 
	
  

 	
  

 
	
  

 	
 ETFS Marketing LLC

 
	
  

 	
 555 California Street, Suite
 2900

 
	
  

 	
 San Francisco, CA 94104

 
	
  

 	
 Attn: Fred Jheon

 
	
  

 	
  

 
	
  

 	
 with a copy to

 
	
  

 	
  

 
	
  

 	
 ETFS Precious Metals Basket
 Trust

 
	
  

 	
 c/o ETF Securities
 Representative Office

 6th Floor

 
	
  

 	
 2 London Wall Buildings

 
	
  

 	
 London, EC2M 5UU

 
	
  

 	
 Telephone: 011 44 207 448-4330

 
	
  

 	
 Attention: President

 
	
  

 	
  

 
	
  

 	
 if to the Marketing Agent at:

 
	
  

 	
  

 
	
  

 	
 ALPS Distributors, Inc.

 
	
  

 	
 1290 Broadway, Suite 1100 

 
	
  

 	
 Denver, Colorado, 80203 

 
	
  

 	
 Attn: General Counsel

 

6

or
such other telecopier (fax) number or address as may be furnished by one party
to the other.

11. Confidential Information — The Marketing Agent, its officers, directors,
employees and agents will treat confidentially and as proprietary information
of the Trust, all records and other information relative to the Trust. If the
Marketing Agent is requested or required by, but not limited to, depositions,
interrogatories, requests for information or documents, subpoena, civil
investigation, demand or other action, proceeding or process or as otherwise
required by law, statute, regulation, writ, decree or the like to disclose such
information, the Marketing Agent will provide ETFS Marketing with prompt
written notice of any such request or requirement so that ETFS Marketing may
seek an appropriate protective order or other appropriate remedy and/or waive
compliance with this provision. If such order or other remedy is not sought, or
obtained, or waiver not received within a reasonable period following such
notice, then the Marketing Agent may without liability hereunder, disclose to
the person, entity or agency requesting or requiring the information, that
portion of the information that is legally required in the reasonable opinion
of the Marketing Agent’s counsel.

12. Miscellaneous — Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof. The Agreement shall be construed, interpreted, and enforced in
accordance with and governed by the laws of the State of Colorado. The captions
in this Agreement are included for convenience of reference only and in no way
define or delimit any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may not be changed, waived, discharged
or amended except by written instrument that shall make specific reference to
this Agreement and which shall be signed by the party against which enforcement
of such change, waiver, discharge or amendment is sought. This Agreement may be
executed simultaneously in two or more counterparts, each of which taken
together shall constitute one and the same instrument.

ETFS
Marketing shall provide all information to the Marketing Agent necessary for
the Marketing Agent to perform its obligations under applicable securities laws
and regulations as they relate to the transactions contemplated in this
agreement; and agrees that its employees registered with and supervised by the
Marketing Agent will comply with the Written Supervisory Procedures of the
Marketing Agent, which may be amended from time to time.

 [Signature
Page to Follow]

7

IN WITNESS WHEREOF, each of the undersigned has executed this instrument in its name and
behalf as of the date and year first above written.

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ETFS
 MARKETING, LLC

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/
 Fred Jheon

 
	
  

 	
  

 	
 

 	
  

 
	
  

 	
 Name:

 	
 Fred Jheon

 
	
  

 	
 Title:

 	
 President & Chief
 Executive Officer

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ALPS
 DISTRIBUTORS, INC.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/
 Thomas A Carter

 
	
  

 	
  

 	

 

 	
  

 
	
  

 	
 Name:

 	
 Thomas A. Carter

 
	
  

 	
 Title:

 	
 President

 

8

Schedule A

Marketing
Agent Services

	
  

 	
  

 	
  

 
	
  

 	
§

 	
 Review marketing
 related legal documents and contracts.

 
	
  

 	
  

 	
  

 
	
  

 	
§

 	
 Consult with ETFS
 Marketing’s marketing staff and on development of FINRA compliant marketing
 campaigns.

 
	
  

 	
  

 	
  

 
	
  

 	
§

 	
 Consult with Trust’s
 legal counsel on marketing materials that are deemed to qualify as a
 free-writing prospectus materials and appropriate disclosure associated with
 all marketing materials.

 
	
  

 	
  

 	
  

 
	
  

 	
§

 	
 Review and file
 applicable marketing materials with FINRA that don’t otherwise qualify as
 free-writing prospectus materials.

 
	
  

 	
  

 	
  

 
	
  

 	
 §

 	
 Register and oversee
 supervisory activities of unlimited number of FINRA licensed registered
 representatives.

 
	
  

 	
  

 	
  

 
	
  

 	
§

 	
 Maintain, reproduction
 and storage of applicable books and records related to the services provided
 under this Agreement.

 

9exv4w1

Exhibit 4.1

FIRST AMENDMENT TO THE AMENDED AND RESTATED RIGHTS AGREEMENT

     THIS AMENDMENT to the Amended and Restated Rights Agreement, dated as of October 14, 2010 (the
“Amendment”), is made and entered into between HAWK CORPORATION, a Delaware corporation (the
“Company”), and COMPUTERSHARE TRUST COMPANY, N.A., as Rights Agent (the “Rights Agent”).

     WHEREAS, the Company is entering into an Agreement and Plan of Merger (as the same may be
amended from time to time, the “Merger Agreement”), by and among the Company, Carlisle Companies
Incorporated, a Delaware corporation (“Parent”), and HC Corporation a Delaware corporation (“Merger
Sub”), pursuant to which Merger Sub will: (i) make a tender offer to acquire all of the issued and
outstanding shares of Class A common stock of the Company, par value $0.01 per share (“Common
Stock”), including the associated Rights, on the terms and subject to the conditions set forth in
the Merger Agreement (such tender offer, as it may be amended from time to time, is referred to in
this Amendment as the “Offer”), (ii) be granted an irrevocable option to acquire certain additional
shares of Common Stock directly from the Company on the terms and subject to the conditions set
forth in the Merger Agreement (the “Top-Up Option”), and (iii) after acquiring shares of Common
Stock, including the associated Rights, pursuant to the Offer (and, if applicable, the Top-Up
Option), Merger Sub will merge with and into the Company upon the terms and subject to the
conditions set forth in the Merger Agreement;

     WHEREAS, the Company and the Rights Agent are parties to that certain Amended and Restated
Rights Agreement, dated January 4, 2008 (the “Rights Agreement”);

     WHEREAS, the Company desires to amend the Rights Agreement in connection with the execution
and delivery of the Merger Agreement;

     WHEREAS, Section 27(a) of the Rights Agreement provides that, prior to the Distribution Date,
the Company and the Rights Agent shall, if the Company so directs, supplement or amend any
provision of the Rights Agreement without the approval of any holders of Rights, any such
supplement or amendment to be evidenced by a writing signed by the Company and the Rights Agent;

     WHEREAS, the Board of Directors of the Company has approved this Amendment and authorized its
appropriate officers to execute and deliver the same to the Rights Agent; and

     WHEREAS, pursuant to Section 27(c) of the Rights Agreement, the Company hereby certifies that
this Amendment is in compliance with the terms of Section 27 of the Rights Agreement.

     NOW, THEREFORE, in accordance with the procedures for amendment of the Rights Agreement set
forth in Section 27 thereof, and in consideration of the foregoing and the mutual agreements herein
set forth, the parties hereby agree as follows:

 

 

     1. Capitalized terms that are not otherwise defined herein shall have the meanings ascribed to
them in the Rights Agreement.

     2. The definition of “Acquiring Person” set forth in Section 1(a) of the Rights Agreement is
amended by adding the following sentence to the end of that section:

     “Notwithstanding the foregoing, no Person shall be or become an Acquiring Person by
reason of (i) the execution and delivery of the Agreement and Plan of Merger, dated as of
October 14, 2010, by and among the Company, Carlisle Companies Incorporated, a Delaware
corporation (“Parent”), and HC Corporation a Delaware corporation (“Merger Sub) (as the same may
be amended from time to time, the “Merger Agreement”) or any amendment thereto, (ii) Merger
Sub’s purchase of Common Shares, including the associated Rights, pursuant to (A) a tender
offer to acquire all of the issued and outstanding Common Shares, including the associated
Rights, to be commenced by Merger Sub pursuant to, and on the terms and subject to the
conditions set forth in, the Merger Agreement (such tender offer, as it may be amended from
time to time, is referred to in this Agreement as the “Offer”), (B) an irrevocable option to
acquire certain additional shares of Common Shares directly from the Company, granted by the
Company to Merger Sub on the terms and subject to the conditions set forth in the Merger
Agreement (the “Top-Up Option”), (iii) the merger of Merger Sub with and into the Company
pursuant to, and on the terms and subject to the conditions set forth in, the Merger Agreement
(the “Merger”), or (iv) the consummation of any other transaction contemplated by the Merger
Agreement.”

     3. The definition of “Shares Acquisition Date” in Section l(x) of the Rights Agreement is
hereby amended by adding the following sentence to the end of that section:

     “Notwithstanding anything else set forth in this Agreement, no Shares Acquisition Date
shall be deemed to have occurred by reason of (i) the execution and delivery or amendment of
the Merger Agreement, (ii) the purchase by Merger Sub of Common Shares, including the
associated Rights, pursuant to the Offer (and, if applicable, the Top-Up Option), (iii) the
Merger, or (iv) the consummation of any other transaction contemplated by the Merger
Agreement.”

     4. Section 3(a) of the Rights Agreement is hereby amended by adding the following sentence to
the end of that section:

     “Notwithstanding anything else set forth in this Agreement, no Distribution Date shall be
deemed to have occurred by reason of (i) the execution and delivery or amendment of the Merger
Agreement, (ii) the purchase by Merger Sub of Common Shares, including the associated Rights,
pursuant to the Offer (and, if applicable, the Top-Up Option), (iii) the Merger, or (iv) the
consummation of any other transaction contemplated by the Merger Agreement.”

     5. Section 7(a)(i) of the Rights Agreement is hereby amended to delete the phrase “(the “Final
Expiration Date”)” so that it shall read as follows:

 

 

     “(i) the close of business on January 4, 2018,”

     6. Section 7(a) is further amended by deleting the word “or” at the end of Section 7(a)(iii)
and by adding the following clause immediately following the word “hereof” in Section 7(a)(iv):

     “, or (v) the moment in time immediately prior to the Effective Time on the Effective
Date (each as defined in Section 2.4 of the Merger Agreement) (the earlier to occur of the
events described in clauses (i) and (iv) of this Section 7(a) shall be referred to as the
“Final Expiration Date”). The Company shall give the Rights Agent prompt written notice of the
Effective Time.”

     7. Section 11(a)(ii) of the Rights Agreement is hereby amended by adding the following
sentence to the end of that section:

     “Notwithstanding anything else set forth in this Agreement, no event requiring an
adjustment under this Section 11(a)(ii) shall be deemed to have occurred by reason of (i) the
execution and delivery or amendment of the Merger Agreement, (ii) the purchase by Merger Sub
of Common Shares, including the associated Rights, pursuant to the Offer (and, if applicable,
the Top-Up Option), (iii) the Merger, or (iv) the consummation of any other transaction
contemplated by the Merger Agreement.”

     8. Sections 13(a)(x) and (y) of the Rights Agreement are amended to read as follows:

     ”(x) the Company shall consolidate with, or merge with and into, any Interested
Stockholder, or if in such merger or consolidation all holders of Common Shares are not
treated alike, (y) the Company shall consolidate with, or merge with, any Interested
Stockholder or, if in such merger or consolidation all holders of Common Shares are not
treated alike, and the Company shall be the continuing or surviving corporation of such
consolidation or merger (other than, in a case of any transaction described in (x) or (y), (i)
a merger or consolidation which would result in all of the securities generally entitled to
vote in the election of directors (“voting securities”) of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by being converted
into securities of the surviving entity) all of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation and the holders of
such securities not having changed as a result of such merger or consolidation, (ii) the
execution and delivery or amendment of the Merger Agreement, (iii) the purchase by Merger Sub
of Common Shares, including the associated Rights, pursuant to the Offer (and, if applicable,
the Top-Up Option), (iv) the Merger, or (v) the consummation of any other transaction
contemplated by the Merger Agreement),”

     The remaining portion of Section 13(a) shall be unchanged and shall remain in full force and
effect.

 

 

     9. The first phrase of Section 13(c) of the Rights Agreement is hereby amended to read as
follows:

     “The Company shall not consummate any such consolidation, merger, sale or transfer
(provided that, throughout this Section 13(c), such consolidation or merger shall not be
deemed to include (i) the execution and delivery or amendment of the Merger Agreement, (ii)
the purchase by Merger Sub of Common Shares, including the associated Rights, pursuant to the
Offer (and, if applicable, the Top-Up Option), (iii) the Merger, or (iv) the consummation of
any other transaction contemplated by the Merger Agreement) unless the Principal Party shall
have a sufficient number of authorized Common Shares that have not been issued or reserved for
issuance to permit the exercise in full of the Rights in accordance with this Section 13 and
unless prior thereto the Company and each Principal Party and each other Person who may become
a Principal Party as a result of such consolidation, merger, sale or transfer shall have
(i) executed and delivered to the Rights Agent a supplemental agreement providing for the
terms set forth in paragraphs (a) and (b) of this Section 13 and further providing that, as
soon as practicable after the date of any consolidation, merger, sale or transfer of assets
mentioned in paragraph (a) of this Section 13, the Principal Party at its own expense shall:”

     The remaining portion of Section 13(c) shall be unchanged and shall remain in full force and
effect.

     10. The Rights Agreement, as amended by this Amendment, shall remain in full force and effect
in accordance with its terms.

     11. All the covenants and provisions of this Amendment by or for the benefit of the Company or
the Rights Agent shall bind and inure to the benefit of their respective successors and assigns
hereunder.

     12. Nothing in this Amendment shall be construed to give to any person or corporation other
than the Company, the Rights Agent, the Exempt Persons and the registered holders of the Rights
Certificates (and, prior to the Distribution Date, the Common Shares) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Rights Agent, the Exempt Persons and the registered holders of the
Rights Certificates (and, prior to the Distribution Date, the Common Shares).

     13. If any term, provision, covenant or restriction of this Amendment is held by a court of
competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Amendment shall remain in full force and
effect and shall in no way be affected, impaired or invalidated; provided, however, that if such
excluded provisions shall adversely affect the rights, immunities, duties or obligations of the
Rights Agent, the Rights Agent shall be entitled to resign immediately.

 

 

     14. This Amendment shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be governed by and construed in accordance with the laws of
such State applicable to contracts to be made and performed entirely within such State.

     15. This Amendment may be executed in any number of counterparts and each of such counterparts
shall for all purposes be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument. A signature to this Amendment transmitted
electronically shall have the same authority, effect, and enforceability as an original signature.

     16. The Company hereby certifies to the Rights Agent that this Amendment is in compliance with
Section 27 of the Rights Agreement.

     17. The Rights Agent shall not be subject to, nor be required to interpret or comply with, nor
determine if any Person has complied with, the Merger Agreement, even though reference thereto may
be made in this Amendment or the Rights Agreement.

     18. By its execution and delivery hereof, the Company directs the Rights Agent to execute this
Amendment.

<Signature page follows>

 

 

     IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to the Amended
and Restated Rights Agreement to be duly executed and attested, all as of the date and year first
above written.

	 	 	 	 	 	 	 	 	 	 	 

	Attest:	 	 	 	HAWK CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	/s/ Byron S. Krantz
	 	 	 	 	 	/s/ Thomas A. Gilbride
	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Byron S. Krantz
	 	 	 	 	 	Thomas A. Gilbride	 	 
	 

	 	Secretary
	 	 	 	 	 	Vice President — Finance and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Attest:	 	 	 	COMPUTERSHARE	 	 
	 	 	 	 	 	 	TRUST COMPANY, N.A.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Suzanne S. O’Brien
	 	 	 	By:
	 	/s/ Dennis V. Moccia	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Suzanne Schaming O’Brien
	 	 	 	 	 	Dennis Moccia	 	 
	 

	 	Corporate Counsel
	 	 	 	 	 	Manager, Contract Administration	 	 

[Signature page: Amendment to Rights Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}]]