Document:

exhibit43.htm

Exhibit 4.3

ILLINOIS TOOL WORKS INC.

Officers’ Certificate Pursuant to

Sections 2.01 and 2.04 of the Indenture

Ronald D. Kropp, Senior Vice President & Chief Financial Officer, and Randall J. Scheuneman, Vice President & Chief Accounting Officer, of Illinois Tool Works Inc., a Delaware corporation (the “Company”), each certify, pursuant to Sections 2.01 and 2.04 of the Indenture dated as of November 1, 1986, as supplemented by the First Supplemental Indenture dated as of May 1, 1990 (the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as successor Trustee, that, pursuant to authority granted by the Board of Directors of the Company to the undersigned and certain other officers of the Company in resolutions duly adopted on August 5, 2011, the terms and form of the Company’s 3.375% Notes due 2021 (the “Notes due 2021”) and the Company’s 4.875% Notes due 2041 (the “Notes due 2041” and together with the Notes due 2021, the “Notes”), shall be as set forth below.  Capitalized terms not defined herein shall have the meanings ascribed to them in the Indenture.

1.           The Notes due 2021 shall be designated as “3.375% Notes due 2021.”

2.           The Notes due 2041 shall be designated as “4.875% Notes due 2041.”

3.           The aggregate principal amount at Stated Maturity of the Notes due 2021 that may be authenticated and delivered under the Indenture (not including Notes due 2021 authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of other Notes due 2021 pursuant to Sections 2.06, 2.07, 2.08, 3.02 or 10.04 of the Indenture) initially shall be not more than $350,000,000.  The Company shall have the right from time to time, without the consent of the existing holders of Notes due 2021, to issue additional notes with the same terms and conditions and with the same CUSIP number as the Notes due 2021, except for the issue date, issue price and the first payment of interest thereon (“Additional Notes due 2021”).  Additional Notes due 2021 will be consolidated with and will form a single series with the Notes due 2021.

4.           The aggregate principal amount at Stated Maturity of the Notes due 2041 that may be authenticated and delivered under the Indenture (not including Notes due 2041 authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of other Notes due 2041 pursuant to Sections 2.06, 2.07, 2.08, 3.02 or 10.04 of the Indenture) initially shall be not more than $650,000,000.  The Company shall have the right from time to time, without the consent of the existing holders of Notes due 2041, to issue additional notes with the same terms and conditions and with the same CUSIP number as the Notes due 2041, except for the issue date, issue price and the first payment of interest thereon (“Additional Notes due 2041” and together with the Additional Notes due 2021, the “Additional Notes”).  Additional Notes due 2041 will be consolidated with and will form a single series with the Notes due 2041.

5.           Each Note due 2021 shall bear interest from and including the most recent Interest Payment Date to which interest on such Note due 2021 (or any predecessor Note due 2021) has been paid or duly made available for payment, or if no interest has been paid, from and including August 31, 2011, at the rate of 3.375% per annum until the principal thereof is paid or made available for payment.  Each Note due 2041 shall bear interest from and including the most recent Interest Payment Date to which interest on such Note due 2041 (or any predecessor Note due 2041) has been paid or duly made available for payment, or if no interest has been paid, from and including August 31, 2011, at the rate of 4.875% per annum until the principal thereof is paid or made available for payment.  Interest shall be payable on each Interest Payment Date and at Stated Maturity.  Interest payments shall be in the amount of interest accrued to, but excluding, the relevant Interest Payment Date or Stated Maturity, as applicable.  Interest shall be payable to the person in whose name a Note (or any predecessor Note) is registered at the close of business on the Record Date next preceding each Interest Payment Date; provided, however, that interest payable at Stated Maturity shall be payable to the person to whom principal shall be payable.  Under certain circumstances, additional interest on the Notes due 2021 and the Notes due 2041 may be payable as and to the extent provided in the Issue Date Registration Rights Agreement or any other Registration Rights Agreement (each as defined in Paragraph 21(g) of this Certificate) applicable to Additional Notes.

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

6.           The Stated Maturity of each Note due 2021 shall be September 15, 2021.

7.           The Stated Maturity of each Note due 2041 shall be September 15, 2041.

8.           The Notes due 2021 shall be substantially in the form attached to this Certificate as Exhibit A.

9.           The Notes due 2041 shall be substantially in the form attached to this Certificate as Exhibit B.

10.           The Notes may be redeemed in whole or in part from time to time at the option of the Company before the applicable date of Stated Maturity at the price and on the terms set forth in the form of Note attached to this Certificate as Exhibit A in the case of the Notes due 2021 and Exhibit B in the case of the Notes due 2041.

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

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

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

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

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

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

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

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

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

20.           Each Global Security shall bear the legend specified therefor on the face thereof in Exhibit A in the case of a Note due 2021 or Exhibit B in the case of a Note due 2041.  Each Restricted Note shall bear the private placement legend (the “Private Placement Legend”) specified therefor on the face thereof in Exhibit A in the case of a Note due 2021 or Exhibit B in the case of a Note due 2041.

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

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

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

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

(B)           a certificate in the form of Exhibit C in the case of a transfer of an interest in Notes due 2021 and a certificate in the form of Exhibit D in the case of a transfer of an interest in Notes due 2041, in each case duly executed by the transferor, and

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

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

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

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

(B)           a certificate in the form of Exhibit E in the case of a transfer of an interest in Notes due 2021 and a certificate in the form of Exhibit F in the case of a transfer of an interest in Notes due 2041, in each case duly executed by the transferor, and

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

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

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

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

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

(iii)           such Notes (or beneficial interests) are transferred pursuant to Rule 144 upon delivery to the Security Registrar of a certificate in the form of Exhibit G in the case of a transfer of Notes due 2021 (or a beneficial interest therein) and a certificate in the form of Exhibit H in the case of a transfer of Notes due 2041 (or a beneficial interest therein), in each case duly executed by the transferor, and an Opinion of Counsel reasonably satisfactory to the Security Registrar;

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

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

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

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

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

(g)           Definitions.

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

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

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

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

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

“Issue Date Notes” means the $350,000,000 aggregate principal amount of Notes due 2021 and the $650,000,000 aggregate principal amount of Notes due 2041 originally issued on the Issue Date, and any replacement Securities and Exchange Notes, issued therefor in accordance with the Indenture.

“Issue Date Registration Rights Agreement” means the Registration Rights Agreement, dated as of August 31, 2011, by and among the Company and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Initial Purchasers.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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IN WITNESS WHEREOF, the undersigned have executed this Certificate as of this 31st day of August 2011.

By:   /s/ Ronald D. Kropp                                                      

Name:            Ronald D. Kropp

Title:            Senior Vice President &

Chief Financial Officer

By:   /s/ Randall J. Scheuneman                                                      

Name:            Randall J. Scheuneman

Title:            Vice President &

Chief Accounting Officer

(Signature Page to Officers’ Certificate Pursuant to Sections 2.01 and 2.04 of the Indenture)

  

  

  

EXHIBIT A

FORM OF NOTE

 

[Include the following legend for Global Securities only:]

 

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

 

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

 

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

 

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

 

[THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE THAT IS ONE YEAR (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION TERMINATION DATE”) EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT (AND THAT CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.]

 

  

  

  

FORM OF

ILLINOIS TOOL WORKS INC.

3.375% NOTE DUE 2021

Principal Amount $[                   ]

as revised by the Schedule of Increases and

 

Decreases in Global Security attached hereto

 

No. __-___ [Date]

 CUSIP NO. [                       ]

ISIN NO. [              ]

ILLINOIS TOOL WORKS INC., a corporation incorporated under the laws of the State of Delaware (hereinafter called the “Company”), for value received, hereby promises to pay to CEDE & CO., or its registered assigns, the principal sum of ____________________ DOLLARS ($___________) subject to adjustment from time to time as reflected on the Schedule of Increases and Decreases in Global Security attached hereto on September 15, 2021 at the office or agency of the Company in Chicago, Illinois or New York, New York or such other location or locations as may be provided for pursuant to the Indenture referred to herein, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest on said principal sum, in arrears, from and including the most recent Interest Payment Date (as defined below) to which interest has been paid or duly provided for (or if no interest has been paid, from and including August 31, 2011), to, but excluding, March 15 and September 15 of each year (each, an “Interest Payment Date”), beginning on March 15, 2012, at the rate of 3.375% per annum, at said offices or agencies, in like coin or currency, to but excluding the date on which said principal sum is paid in full.  The Record Date with respect to each Interest Payment Date shall be the close of business on March 1 or September 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  The interest payable on any Interest Payment Date will, subject to certain exceptions provided in the Indenture referred to herein, be paid by check mailed to the registered address of the person entitled thereto, unless such person and the Company shall have agreed that such payment will be made by wire transfer in immediately available funds.  Notwithstanding the foregoing, if the registered owner of the Notes is The Depository Trust Company (“DTC”) or its nominee, payments of principal and interest shall be made in accordance with the requirements of DTC pursuant to a Letter of Representations between DTC and the Company.

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

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

[signature page follows]

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

ILLINOIS TOOL WORKS INC.

By: /s/ Ronald D. Kropp

Name:  Ronald D. Kropp

Title:    Senior Vice President &

Chief Financial Officer

[SEAL]

By: /s/ Randall J. Scheuneman

Name:           Randall J. Scheuneman

Title:           Vice President &

Chief Accounting Officer

By: /s/ Janet O. Love

Name:           Janet O. Love

Title:           Associate General Counsel &

Assistant Secretary

	
  

	 

3.375% Note Due 2021

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TRUSTEE’S CERTIFICATE OF AUTHENTICATION

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

	
  

	
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee

Dated:  ____________________, 2011                                                                           By: _______________________________

Authorized Signature

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

3.375% Note Due 2021

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ADDITIONAL TERMS OF

ILLINOIS TOOL WORKS INC.

3.375% NOTE DUE 2021

This Security is one of a duly authorized issue of the Securities of Illinois Tool Works Inc., a Delaware corporation (the “Company”), designated as its 3.375% Notes due 2021 (individually, a “Security” and collectively, the “Securities”), issued under and pursuant to an Indenture dated as of November 1, 1986 and supplemented by a First Supplemental Indenture dated as of May 1, 1990 (the “Indenture”), duly executed and delivered by the Company and The Bank of New York Mellon Trust Company, N.A., as successor trustee (the “Trustee”).  The terms of the Securities include those stated in the Indenture and in the Officers’ Certificate dated August 31, 2011 (the “Officers’ Certificate”) establishing certain terms of the Securities pursuant to the Indenture, those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”), and those set forth in this Security.  This Security is subject to all such terms, and Holders are referred to the Indenture, the Officer’s Certificate and the TIA for a statement of all such terms.  All terms used in this Security that are defined in the Indenture or in the Officers’ Certificate shall have the meanings assigned to them therein.  The Securities are unsecured general obligations of the Company.

The Securities are initially limited to the aggregate principal amount of Three Hundred Fifty Million Dollars ($350,000,000), as specified in the Officers’ Certificate.  The Company may from time to time, without the consent of the existing Holders of Securities, issue additional Securities with the same terms and conditions and with the same CUSIP number as the Securities, except for the issue date, issue price and the first payment of interest thereon.  Additional Securities so issued will be consolidated with and will form a single series with the Securities.

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

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

This Security may be redeemed at the Company’s option, in whole or in part, on any date that is prior to June 15, 2021 at a redemption price equal to the greater of (i) 100% of the principal amount of the Securities to be redeemed on the date of redemption or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Securities being redeemed on the date of redemption (exclusive of interest accrued to the date of redemption) discounted to the date of redemption on a semiannual basis at the Treasury Rate (as defined below) plus 20 basis points, as determined by a Reference Treasury Dealer (as defined below), plus accrued and unpaid interest on the principal amount being redeemed to the date of redemption.  At any time on or after June 15, 2021, the Company may also redeem some or all of this Security at its option, at a redemption price equal to 100% of the principal amount of the Securities being redeemed on the date of redemption, plus accrued and unpaid interest on the principal amount being redeemed to the date of redemption.  Notwithstanding the foregoing, installments of interest on Securities that are due and payable on Interest Payment Dates falling on or prior to a date of redemption will be payable on the Interest Payment Date to the registered holder hereof as of the close of business on the relevant Record Date according to this Security and the Indenture.  The redemption price will be calculated on the basis of a 360-day year consisting of twelve 30-day months.

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

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

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

“Reference Treasury Dealer” means (i) J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated (or their respective affiliates that are Primary Treasury Dealers) and their respective successors; provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company will substitute therefor another Primary Treasury Dealer and (ii) any other Primary Treasury Dealer(s) (in any case not less than two) selected by the Company.

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

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

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

Except as otherwise specifically provided herein, the Securities may not be redeemed before September 15, 2021 (herein referred to as the “Stated Maturity”) and shall not be entitled to any sinking, purchase or analogous fund, nor shall the Company be obligated to redeem or purchase the Securities at the option of any Holder thereof.

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

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

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

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

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

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

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

A-

  

  

  

[FORM OF TRANSFER NOTICE]

 

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

 

Insert Taxpayer Identification No.

 

                                                                                                      

 

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

 

                                                                                                      

 

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

 

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

 

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

 

[Check One]

 

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

 

or

 

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

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

 

	
Date:

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

 

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

 

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

 

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

 

	
Dated:

	  	  	  
	  	
NOTICE: To be executed by an executive officer

A-

  

  

  

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

 

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

 

	

Date of Exchange

	

Amount of decrease in Principal Amount of this Global Note

	

Amount of increase in Principal Amount of this Global Note

	

Principal Amount of this Global Note following such decrease or increase

	

Signature of authorized signatory of Trustee or Note Custodian

	  	  	  	  	  
	  	  	  	  	  

 

 

  

  

  

EXHIBIT B

FORM OF NOTE

 

[Include the following legend for Global Securities only:]

 

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

 

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

 

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

 

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

 

[THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE THAT IS ONE YEAR (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION TERMINATION DATE”) EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT (AND THAT CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.]

 

  

  

  

FORM OF

ILLINOIS TOOL WORKS INC.

4.875% NOTE DUE 2041

Principal Amount $[                   ]

as revised by the Schedule of Increases and

 

Decreases in Global Security attached hereto

 

No. __-___ [Date]

 CUSIP NO. [                       ]

ISIN NO. [              ]

ILLINOIS TOOL WORKS INC., a corporation incorporated under the laws of the State of Delaware (hereinafter called the “Company”), for value received, hereby promises to pay to CEDE & CO., or its registered assigns, the principal sum of ____________________ DOLLARS ($___________) subject to adjustment from time to time as reflected on the Schedule of Increases and Decreases in Global Security attached hereto on September 15, 2041, at the office or agency of the Company in Chicago, Illinois or New York, New York or such other location or locations as may be provided for pursuant to the Indenture referred to herein, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest on said principal sum, in arrears, from and including the most recent Interest Payment Date (as defined below) to which interest has been paid or duly provided for (or if no interest has been paid, from and including August 31, 2011), to, but excluding, March 15 and September 15 of each year (each, an “Interest Payment Date”), beginning on March 15, 2012, at the rate of 4.875% per annum, at said offices or agencies, in like coin or currency, to but excluding the date on which said principal sum is paid in full.  The Record Date with respect to each Interest Payment Date shall be the close of business on March 1 or September 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  The interest payable on any Interest Payment Date will, subject to certain exceptions provided in the Indenture referred to herein, be paid by check mailed to the registered address of the person entitled thereto, unless such person and the Company shall have agreed that such payment will be made by wire transfer in immediately available funds.  Notwithstanding the foregoing, if the registered owner of the Notes is The Depository Trust Company (“DTC”) or its nominee, payments of principal and interest shall be made in accordance with the requirements of DTC pursuant to a Letter of Representations between DTC and the Company.

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

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

[signature page follows]

B-

  

  

  

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

ILLINOIS TOOL WORKS INC.

By: /s/ Ronald D. Kropp

Name:  Ronald D. Kropp

Title:    Senior Vice President &

Chief Financial Officer

[SEAL]

By: /s/ Randall J. Scheuneman

Name:           Randall J. Scheuneman

Title:           Vice President &

Chief Accounting Officer

	
  

	 

By: /s/ Janet O. Love

Name:           Janet O. Love

Title:           Associate General Counsel &

Assistant Secretary

	
  

	 

4.875% Note Due 2041

B-

  

  

  

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

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

	
  

	
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee

Dated:  ____________________, 2011                                                                           By: _______________________________

Authorized Signature

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

4.875% Note Due 2041

B-

  

  

  

ADDITIONAL TERMS OF

ILLINOIS TOOL WORKS INC.

4.875% NOTE DUE 2041

This Security is one of a duly authorized issue of the Securities of Illinois Tool Works Inc., a Delaware corporation (the “Company”), designated as its 4.875% Notes due 2041 (individually, a “Security” and collectively, the “Securities”), issued under and pursuant to an Indenture dated as of November 1, 1986 and supplemented by a First Supplemental Indenture dated as of May 1, 1990 (the “Indenture”), duly executed and delivered by the Company and The Bank of New York Mellon Trust Company, N.A., as successor trustee (the “Trustee”).  The terms of the Securities include those stated in the Indenture and in the Officers’ Certificate dated August 31, 2011 (the “Officers’ Certificate”) establishing certain terms of the Securities pursuant to the Indenture, those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”), and those set forth in this Security.  This Security is subject to all such terms, and Holders are referred to the Indenture, the Officer’s Certificate and the TIA for a statement of all such terms.  All terms used in this Security that are defined in the Indenture or in the Officers’ Certificate shall have the meanings assigned to them therein.  The Securities are unsecured general obligations of the Company.

The Securities are initially limited to the aggregate principal amount of Six Hundred Fifty Million Dollars ($650,000,000), as specified in the Officers’ Certificate.  The Company may from time to time, without the consent of the existing Holders of Securities, issue additional Securities with the same terms and conditions and with the same CUSIP number as the Securities, except for the issue date, issue price and the first payment of interest thereon.  Additional Securities so issued will be consolidated with and will form a single series with the Securities.

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

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

This Security may be redeemed at the Company’s option, in whole or in part, on any date that is prior to March 15, 2041 at a redemption price equal to the greater of (i) 100% of the principal amount of the Securities to be redeemed on the date of redemption or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Securities being redeemed on the date of redemption (exclusive of interest accrued to the date of redemption) discounted to the date of redemption on a semiannual basis at the Treasury Rate (as defined below) plus 25 basis points, as determined by a Reference Treasury Dealer (as defined below), plus accrued and unpaid interest on the principal amount being redeemed to the date of redemption.  At any time on or after March 15, 2041, the Company may also redeem some or all of this Security at its option, at a redemption price equal to 100% of the principal amount of the Securities being redeemed on the date of redemption, plus accrued and unpaid interest on the principal amount being redeemed to the date of redemption.  Notwithstanding the foregoing, installments of interest on Securities that are due and payable on Interest Payment Dates falling on or prior to a date of redemption will be payable on the Interest Payment Date to the registered holder hereof as of the close of business on the relevant Record Date according to this Security and the Indenture.  The redemption price will be calculated on the basis of a 360-day year consisting of twelve 30-day months.

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

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

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

“Reference Treasury Dealer” means (i) J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated (or their respective affiliates that are Primary Treasury Dealers) and their respective successors; provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company will substitute therefor another Primary Treasury Dealer and (ii) any other Primary Treasury Dealer(s) (in any case not less than two) selected by the Company.

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

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

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

Except as otherwise specifically provided herein, the Securities may not be redeemed before September 15, 2041 (herein referred to as the “Stated Maturity”) and shall not be entitled to any sinking, purchase or analogous fund, nor shall the Company be obligated to redeem or purchase the Securities at the option of any Holder thereof.

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

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

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

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

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

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

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

B-

  

  

  

[FORM OF TRANSFER NOTICE]

 

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

 

Insert Taxpayer Identification No.

 

                                                                                                      

 

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

 

                                                                                                      

 

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

 

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

 

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

 

[Check One]

 

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

 

or

 

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

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

 

	
Date:

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

 

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

 

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

 

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

 

	
Dated:

	  	  	  
	  	
NOTICE: To be executed by an executive officer

B-

  

  

  

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

 

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

 

	

Date of Exchange

	

Amount of decrease in Principal Amount of this Global Note

	

Amount of increase in Principal Amount of this Global Note

	

Principal Amount of this Global Note following such decrease or increase

	

Signature of authorized signatory of Trustee or Note Custodian

	  	  	  	  	  
	  	  	  	  	  

 

 

  

  

  

EXHIBIT C

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 3.375% NOTES DUE 2021

PURSUANT TO REGULATION S

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
3.375% Notes due 2021 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011, relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Very truly yours,

 

 

[Name of Transferor]

 

By:                                                                

 

 

Authorized Signature

  

  

  

EXHIBIT D

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 4.875% NOTES DUE 2041

PURSUANT TO REGULATION S

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
4.875% Notes due 2041 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011, relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Very truly yours,

 

 

[Name of Transferor]

 

By:                                                                

 

 

Authorized Signature

  

  

  

EXHIBIT E

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 3.375% NOTES DUE 2021 TO QIB

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
3.375% Notes due 2021 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011, relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

  

  

  

 

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

 

Very truly yours,

 

[Name of Transferor]

 

By:                                                                

 

Authorized Signature

  

  

  

EXHIBIT F

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 4.875% NOTES DUE 2041 TO QIB

 

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
4.875% Notes due 2041 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011 relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

  

  

  

 

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

 

Very truly yours,

 

[Name of Transferor]

 

By:                                                                

 

Authorized Signature

  

  

  

EXHIBIT G

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 3.375% NOTES DUE 2021 PURSUANT TO RULE 144

 

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
3.375% Notes due 2021 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011, relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

Very truly yours,

 

[Name of Transferor]

 

By:                                                                

 

 

Authorized Signature

  

  

  

EXHIBIT H

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH

TRANSFER OF 4.875% NOTES DUE 2041 PURSUANT TO RULE 144

 

[Date]

 

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

2 N. LaSalle Street, Suite 1020

Chicago IL 60602

	
  

	
Re:

	
4.875% Notes due 2041 (the “Notes”)

 

	
  

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

 

	
  

	
CUSIP No. [__________]

 

Ladies and Gentlemen:

 

Reference is hereby made to (1) the Indenture, dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990 (as amended and supplemented from time to time, the “Indenture”), between Illinois Tool Works Inc. and The Bank of New York Mellon Trust Company, N.A., as successor trustee and (2) the Officers’ Certificate, dated as of August 31, 2011, relating to the Notes (the “Officers’ Certificate”).  Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or the Officers’ Certificate.

 

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

 

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

 

Very truly yours,

 

[Name of Transferor]

 

By:                                                                

 

 

Authorized Signatureexhibit44.htm

Exhibit 4.4

REGISTRATION RIGHTS AGREEMENT

This REGISTRATION RIGHTS AGREEMENT dated August 31, 2011 (this “Agreement”) is entered into by and among Illinois Tool Works Inc. (the “Company”), and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated (the “Initial Purchasers”).

The Company and the Initial Purchasers are parties to the Purchase Agreement, dated as of August 24, 2011 (the “Purchase Agreement”), which provides for the sale by the Company to the Initial Purchasers and any other initial purchasers named therein of (i) $350,000,000 aggregate principal amount of the Company’s 3.375% Notes due 2021 (the “2021 Notes”) and (ii) $650,000,000 aggregate principal amount of the Company’s 4.875% Notes due 2041 (the “2041 Notes”, and together with the 2021 Notes, the “Securities”).  As an inducement to the Initial Purchasers to enter into the Purchase Agreement, the Company has agreed to provide to the Initial Purchasers and their direct and indirect transferees the registration rights set forth in this Agreement.  The execution and delivery of this Agreement is a condition to the closing under the Purchase Agreement.

In consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.           Definitions.  As used in this Agreement, the following terms shall have the following meanings:

“2021 Notes” shall have the meaning set forth in the Preamble.

“2041 Notes” shall have the meaning set forth in the Preamble.

“Agreement” shall have the meaning set forth in the Preamble.

“Business Day” shall mean any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed.

“Company” shall have the meaning set forth in the Preamble and shall also include the Company’s successors.

“Default Day” shall have the meaning set forth in Section 2(d) hereof.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

“Exchange Date” shall have the meaning set forth in Section 2(a)(ii) hereof.

“Exchange Offer” shall mean the exchange offer by the Company of Exchange Securities for Registrable Securities pursuant to Section 2(a) hereof.

“Exchange Offer Registration” shall mean a registration under the Securities Act effected pursuant to Section 2(a) hereof.

“Exchange Offer Registration Statement” shall mean an exchange offer registration statement on Form S-4 (or, if applicable, on another appropriate form) and all amendments and supplements to such registration statement, in each case including the Prospectus contained therein or deemed a part thereof, all exhibits thereto and any document incorporated by reference therein.

“Exchange Securities” shall mean notes issued by the Company under the Indenture containing terms identical to the Securities (except that the Exchange Securities will not be subject to restrictions on transfer or to any increase in annual interest rate for failure to comply with this Agreement) and to be offered to Holders of Registrable Securities in exchange for Exchange Securities pursuant to the Exchange Offer.

“FINRA” means the Financial Industry Regulatory Authority, Inc.

“Free Writing Prospectus” means each free writing prospectus (as defined in Rule 405 under the Securities Act) prepared by or on behalf of the Company or used or referred to by the Company, in each case in connection with the sale of the Securities or Exchange Securities pursuant to this Agreement.

“Holders” shall mean the Initial Purchasers, and each of their successors, assigns and direct and indirect transferees who become owners of Registrable Securities under the Indenture, in each case for so long as they hold any Registrable Securities; provided that for purposes of Sections 4 and 5 of this Agreement, the term “Holders” shall include Participating Broker-Dealers.

“Indemnified Person” shall have the meaning set forth in Section 5(c) hereof.

“Indemnifying Person” shall have the meaning set forth in Section 5(c) hereof.

“Indenture” shall mean the Indenture relating to the Securities and Exchange Securities dated as of November 1, 1986, as supplemented by a First Supplemental Indenture dated as of May 1, 1990, between the Company and The Bank of New York Mellon Trust Company, N.A., as successor trustee, and as the same may be amended from time to time in accordance with the terms thereof.

“Initial Purchasers” shall have the meaning set forth in the Preamble.

“Issuer Information” shall have the meaning set forth in Section 5(a) hereof.

“Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of the outstanding Registrable Securities; provided that whenever the consent or approval of Holders of a specified percentage of Registrable Securities is required hereunder, any Registrable Securities owned directly or indirectly by the Company or any of its affiliates shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage or amount; and provided, further, that if the Company shall issue any additional Securities under the Indenture prior to consummation of the Exchange Offer or, if applicable, the effectiveness of any Shelf Registration Statement, such additional Securities and the Registrable Securities to which this Agreement relates shall be treated together as one class for purposes of determining whether the consent or approval of Holders of a specified percentage of Registrable Securities has been obtained.

“Participating Broker-Dealers” shall have the meaning set forth in Section 4(a) hereof.

“Person” shall mean any individual, company, corporation, firm, partnership, joint venture, undertaking, association, organization, trust, state or agency of a state (in each case, whether or not having separate legal personality).

“Prospectus” shall mean the prospectus included in, or, pursuant to the rules and regulations of the Securities Act, deemed a part of, a Registration Statement, including any preliminary prospectus, and any such prospectus as amended or supplemented by any prospectus supplement, including a prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by a Shelf Registration Statement, and by all other amendments and supplements to such prospectus, and in each case including any document incorporated by reference therein.

“Purchase Agreement” shall have the meaning set forth in the Preamble.

“Registrable Securities” shall mean the Securities; provided that the Securities shall cease to be Registrable Securities (i) when a Registration Statement with respect to such Securities has become effective under the Securities Act and such Securities have been exchanged or disposed of pursuant to such Registration Statement, (ii) when such Securities cease to be outstanding or (iii) after the period that is the earlier to occur of (A) one (1) year following the effective date of the Shelf Registration Statement, or (B) two (2) years from the date of this Agreement.

“Registration Default” shall have the meaning set forth in Section 2(d) hereof.

“Registration Expenses” shall mean any and all expenses incident to performance of or compliance by the Company with this Agreement, including without limitation: (i) all SEC, stock exchange or FINRA registration and filing fees, (ii) all fees and expenses incurred in connection with compliance with state securities or blue sky laws (including reasonable and documented fees and disbursements of one counsel for any Underwriters or Holders in connection with blue sky qualification of any Exchange Securities or Registrable Securities), (iii) all expenses of any Persons in preparing or assisting in preparing, word processing, printing and distributing any Registration Statement, any Prospectus, any Free Writing Prospectus and any amendments or supplements thereto, any underwriting agreements, securities sales agreements or other similar agreements and any other documents relating to the performance of and compliance with this Agreement, provided that such Persons have been appointed by the Company or with the prior approval of the Company, (iv) all rating agency fees, (v) all fees and disbursements relating to the qualification of the Indenture under applicable securities laws, (vi) the reasonable and documented fees and disbursements of the Trustee and its counsel in accordance with the terms of the Indenture, (vii) the reasonable and documented fees and disbursements of counsel for the Company and, in the case of a Shelf Registration Statement, the reasonable and documented fees and disbursements of one counsel for the Holders (which counsel shall be selected by the Holders of a majority of the principal amount of the Registrable Securities to be covered by the Shelf Registration Statement and which counsel may also be counsel for the Initial Purchasers) and (viii) the fees and disbursements of the independent public accountants of the Company including the expenses of any special audits or “comfort” letters required by or incident to the performance of and compliance with this Agreement, but excluding fees and expenses of counsel to the Underwriters (other than fees and expenses set forth in clause (ii) above) or the Holders and underwriting discounts and commissions, brokerage commissions and transfer taxes, if any, relating to the sale or disposition of Registrable Securities by a Holder.

“Registration Statement” shall mean any registration statement of the Company that covers any of the Exchange Securities or Registrable Securities pursuant to the provisions of this Agreement and all amendments and supplements to any such registration statement, including post-effective amendments, in each case including the Prospectus contained therein or deemed a part thereof, all exhibits thereto and any document incorporated by reference therein.

“SEC” shall mean the United States Securities and Exchange Commission.

“Securities” shall have the meaning set forth in the Preamble.

“Securities Act” shall mean the Securities Act of 1933, as amended from time to time.

“Shelf Effectiveness Period” shall have the meaning set forth in Section 2(b) hereof.

“Shelf Filing Date” shall have the meaning set forth in Section 2(b) hereof.

“Shelf Registration” shall mean a registration effected pursuant to Section 2(b) hereof.

“Shelf Registration Statement” shall mean a “shelf” registration statement of the Company that covers all or a portion of the Registrable Securities (but no other securities unless approved by the Holders of a majority of the principal amount of the Registrable Securities to be covered by such Shelf Registration Statement) on an appropriate form under Rule 415 under the Securities Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective amendments, in each case including the Prospectus contained therein or deemed a part thereof, all exhibits thereto and any document incorporated by reference therein.

“Special Interest Premium” shall have the meaning set forth in Section 2(d) hereof.

“Staff” shall mean the staff of the SEC.

“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended from time to time.

“Trustee” shall mean the trustee with respect to the Securities under the Indenture.

“Underwriter” shall have the meaning set forth in Section 3(e) hereof.

“Underwritten Offering” shall mean an offering in which Registrable Securities are sold to an Underwriter for reoffering to the public.

2.           Registration Under the Securities Act.  (a)  To the extent not prohibited by any applicable law or applicable interpretations of the Staff, the Company shall (x) cause to be filed as promptly as practicable after the date it has filed its Annual Report on Form 10-K for the year-ended December 31, 2011 an Exchange Offer Registration Statement covering an offer to the Holders to exchange all the Registrable Securities for Exchange Securities and (y) use its reasonable best efforts to cause such Registration Statement to be declared effective as promptly as practicable after filing thereof.  The Company shall commence the Exchange Offer promptly after the Exchange Offer Registration Statement is declared effective by the SEC and use its reasonable best efforts to complete the Exchange Offer not later than 365 calendar days after the date hereof.

The Company shall commence the Exchange Offer by mailing the related Prospectus, appropriate letters of transmittal and other accompanying documents to each Holder stating, in addition to such other disclosures as are required by applicable law, substantially the following:

	
(i)  

	
that the Exchange Offer is being made pursuant to this Agreement and that all Registrable Securities validly tendered and not properly withdrawn will be accepted for exchange;

	
(ii)  

	
the date of acceptance for exchange (which shall be a period of at least twenty (20) business days (as defined in Rule 14d-1 under the Exchange Act) from the date such notice is mailed) (the “Exchange Date”);

	
(iii)  

	
that any Registrable Security not tendered will remain outstanding and continue to accrue interest but will not retain any rights under this Agreement, except as otherwise specified herein;

	
(iv)  

	
that any Holder electing to have a Registrable Security exchanged pursuant to the Exchange Offer will be required to (A) surrender such Registrable Security, together with the appropriate letters of transmittal, to the institution and at the address and in the manner specified in the notice, or (B) effect such exchange otherwise in compliance with the applicable procedures of the depositary for such Registrable Security, in each case prior to the close of business on the Exchange Date; and

	
(v)  

	
that any Holder will be entitled to withdraw its election, not later than the close of business on the Exchange Date, by (A) sending to the institution and at the address specified in the notice, a telex, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Registrable Securities delivered for exchange and a statement that such Holder is withdrawing its election to have such Securities exchanged or (B) effecting such withdrawal in compliance with the applicable procedures of the depositary for the Registrable Securities.

As a condition to participating in the Exchange Offer, a Holder will be required to represent to the Company that (i) any Exchange Securities to be received by it will be acquired in the ordinary course of its business, (ii) at the time of the Exchange Offer it has no arrangement or understanding with any Person to participate in, is not engaged in and does not intend to engage in, the distribution (within the meaning of the Securities Act) of the Exchange Securities in violation of the provisions of the Securities Act, (iii) it is not an “affiliate” (within the meaning of Rule 405 under the Securities Act) of the Company and (iv) if such Holder is a broker-dealer that will receive Exchange Securities for its own account in exchange for Registrable Securities that were acquired as a result of market-making or other trading activities, then such Holder will deliver a Prospectus (or, to the extent permitted by law, make available a Prospectus to purchasers) in connection with any resale of such Exchange Securities.

As soon as practicable after the Exchange Date, the Company shall:

	
(i)  

	
accept for exchange Registrable Securities or portions thereof validly tendered and not properly withdrawn pursuant to the Exchange Offer; and

	
(ii)  

	
deliver, or cause to be delivered, to the Trustee for cancellation all Registrable Securities or portions thereof so accepted for exchange by the Company and issue, and cause the Trustee to promptly authenticate and deliver to each Holder, Exchange Securities equal in principal amount to the principal amount of the Registrable Securities tendered by such Holder.

The Company shall use its reasonable best efforts to complete the Exchange Offer as provided above and shall comply in all material respects with the applicable requirements of the Securities Act, the Exchange Act and other applicable laws and regulations in connection with the Exchange Offer.  The Exchange Offer shall not be subject to any conditions, other than that the Exchange Offer does not violate any applicable law or applicable interpretations of the Staff.

(b)           In the event that (i) the Company determines that the Exchange Offer Registration provided for in Section 2(a) above is not available or may not be completed prior to the 365th calendar day after the date hereof because it would violate any applicable law or applicable interpretations of the Staff, (ii) the Exchange Offer is not for any other reason completed prior to the 365th calendar day after the date hereof, (iii) in the case of any Holder that participates in the Exchange Offer in accordance with the terms thereof, such holder does not receive Exchange Securities on the date of the exchange that may be sold without restriction under state and federal securities laws (other than due solely to the status of such Holder as an affiliate of the Company within the meaning of the Securities Act or as a broker-dealer) or (iv) the Company so elects, the Company shall (1) promptly deliver to the Holders written notice thereof and (2) at the Company’s sole expense, (a) file, as promptly as practicable (but in no event, in the cases of the foregoing clauses (i), (ii) and (iii), more than forty-five (45) calendar days after the later to occur of (A) the date the obligation arises, or (B) the date on which the Company files its Annual Report on Form 10-K for the year ended December 31, 2011, such 45th day, the “Shelf Filing Date”), a Shelf Registration Statement providing for the sale of all the Registrable Securities by the Holders thereof and (b) use the Company’s reasonable best efforts to cause the Shelf Registration Statement to be declared effective under the Securities Act.

The Company agrees to use its reasonable best efforts to keep the Shelf Registration Statement continuously effective until the expiration of the period ending on the earlier to occur of (A) one (1) year following the effective date of the Shelf Registration Statement, or (B) two (2) years from the date of this Agreement with respect to the Registrable Securities or such shorter period that will terminate when all the Registrable Securities covered by the Shelf Registration Statement have been sold pursuant to the Shelf Registration Statement (the “Shelf Effectiveness Period”).  The Company further agrees to supplement or amend the Shelf Registration Statement, the related Prospectus and any Free Writing Prospectus if required by the rules, regulations or instructions applicable to the registration form used by the Company for such Shelf Registration Statement or by the Securities Act or by any other rules and regulations thereunder or if reasonably requested by a Holder of Registrable Securities with respect to information relating to such Holder, and to use its reasonable best efforts to cause any such amendment to become effective, if required, and such Shelf Registration Statement, Prospectus or Free Writing Prospectus, as the case may be, to become usable as soon as thereafter practicable.  The Company agrees to furnish to the Holders of Registrable Securities copies of any such supplement or amendment promptly after its being used or filed with the SEC.

(c)           The Company shall pay all Registration Expenses in connection with any registration pursuant to Section 2(a) or Section 2(b) hereof.  Each Holder shall pay all underwriting discounts and commissions, brokerage commissions and transfer taxes, if any, relating to the sale or disposition of such Holder’s Registrable Securities pursuant to the Shelf Registration Statement.

(d)           An Exchange Offer Registration Statement pursuant to Section 2(a) hereof will not be deemed to have become effective unless it has been declared effective by the SEC.  A Shelf Registration Statement pursuant to Section 2(b) hereof will not be deemed to have become effective unless it has been declared effective by the SEC or is automatically effective upon filing with the SEC as provided in Rule 462 under the Securities Act.

If the Exchange Offer is not consummated, or the Shelf Registration Statement has not become effective, on or prior to the 365th calendar day after the date hereof (a “Registration Default”), then a special interest premium (the “Special Interest Premium”) will accrue in respect of the Registrable Securities from and including the 366th calendar day at a rate equal to 0.50% per annum thereafter. If the Company is required to, or elects to, file a Shelf Registration Statement and the Company requests Holders of the Registrable Securities to provide the information called for hereby for inclusion in the Shelf Registration Statement, the Registrable Securities owned by Holders who do not deliver such information to the Company when required hereby will not be entitled to any such increase in the interest rate for any day after the Shelf Filing Date.  The interest rate on the Registrable Securities will be reduced to the original interest rate for the Registrable Securities commencing with the earlier to occur of the consummation of the Exchange Offer or a Shelf Registration Statement becoming effective.

If a Shelf Registration Statement is declared effective pursuant to the foregoing paragraphs, and if the Company fails to keep such Shelf Registration Statement continuously (x) effective or (y) useable for resales for the period required by this Agreement due to certain circumstances relating to pending corporate developments, public filings with the SEC and similar events, or because the Prospectus related to such Shelf Registration Statement contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading, and such failure continues for more than thirty (30) days (whether or not consecutive) in any twelve-month period (the 31st day being referred to as the “Default Day”), then from the Default Day until the earliest of (i) the date that the Shelf Registration Statement is again deemed effective or is usable, (ii) the date that is the second anniversary of the Closing Date, or (iii) the date as of which all of the Registrable Securities are sold pursuant to the Shelf Registration Statement, the Special Interest Premium in respect of the Registrable Securities will accrue at a rate equal to 0.25% per annum for the first ninety (90) calendar days following the Default Day and at a rate equal to 0.50% per annum thereafter; provided that at no time shall the rate of Special Interest Premium payable (including Special Interest Premium payable pursuant to the preceding paragraph) exceed 0.50% per annum.

If the Company fails to keep the Shelf Registration Statement continuously effective or useable for resales pursuant to the preceding paragraph or the Company fails to keep the Exchange Offer Registration Statement effective in connection with the use of the Prospectus contained in that Registration Statement by Participating Broker-Dealers as contemplated above, it will give the Holders notice to suspend the sale of the Registrable Securities or the Exchange Securities as the case may be and will extend the relevant period referred to above during which it is required to keep effective the Shelf Registration Statement or the period during which Participating Broker-Dealers are entitled to use the Prospectus included in an Exchange Offer Registration Statement in connection with the resale of Exchange Securities by the number of days during the period from and including the date of the giving of such notice to and including the earlier of: (i) the date when Holders will have received copies of the supplemented or amended Prospectus necessary to permit resales of the Registrable Securities or the Exchange Securities, as the case may be, and (ii) the date on which the Company has given notice that the sale of the Registrable Securities or the Exchange Securities, as the case may be, may be resumed.

(e)           The parties hereto agree that the additional interest provided for in this Section 2 constitutes a reasonable estimate of and is intended to constitute the sole damages that will be suffered by Holders of Registrable Securities by reason of the failure of the Shelf Registration Statement to become or remain effective or the Exchange Offer to be consummated, in each case to the extent required by this Agreement.

3.           Registration Procedures.  (a) In connection with its obligations pursuant to Section 2(a) and Section 2(b) hereof, the Company shall:

(i)           prepare and file with the SEC a Registration Statement on the appropriate form under the Securities Act, which form (x) shall be selected by the Company, (y) shall, in the case of a Shelf Registration, be available for the sale of the Registrable Securities by the Holders thereof and (z) shall comply as to form in all material respects with the requirements of the applicable form and include all financial statements required by the SEC to be filed therewith; and use its reasonable best efforts to cause such Registration Statement to become effective and remain effective for the applicable period in accordance with Section 2 hereof;

(ii)           prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as may be necessary to keep such Registration Statement effective for the applicable period in accordance with Section 2 hereof and cause each Prospectus to be supplemented by any required prospectus supplement and, as so supplemented, to be filed pursuant to Rule 424 under the Securities Act; and keep each Prospectus current during the period described in Section 4(3) of, and Rule 174 under, the Securities Act that is applicable to transactions by brokers or dealers with respect to the Registrable Securities or Exchange Securities;

(iii)           to the extent any Free Writing Prospectus is used, file with the SEC any Free Writing Prospectus that is required to be filed by the Company with the SEC in accordance with the Securities Act and retain in accordance with the Securities Act any Free Writing Prospectus not required to be filed;

(iv)           in the case of a Shelf Registration, furnish to each Holder of Registrable Securities, to counsel for the Initial Purchasers, to counsel for such Holders and to each Underwriter of an Underwritten Offering of Registrable Securities, if any, without charge, as many copies of each Prospectus, preliminary prospectus or Free Writing Prospectus, and any amendment or supplement thereto, in each case relating to the Shelf Registration Statement, as such Holder, Underwriter or counsel of such Holder, Underwriter or Initial Purchaser may reasonably request in order to facilitate the sale or other disposition of the Registrable Securities thereunder; and the Company consents to the use of such Prospectus, preliminary prospectus or such Free Writing Prospectus and any amendment or supplement thereto in accordance with applicable law by each of the Holders of Registrable Securities and any such Underwriters in connection with the offering and sale of the Registrable Securities covered by and in the manner described in such Prospectus, preliminary prospectus or such Free Writing Prospectus or any amendment or supplement thereto in accordance with applicable law;

(v)           use its reasonable best efforts to register or qualify the Registrable Securities under all applicable state securities or blue sky laws of such jurisdictions as any Holder of Registrable Securities covered by a Registration Statement shall reasonably request in writing by the time the applicable Registration Statement becomes effective; cooperate with such Holders in connection with any filings required to be made with FINRA; and do any and all other acts and things that may be reasonably necessary or advisable to enable each Holder to complete the disposition in each such jurisdiction of the Registrable Securities owned by such Holder; provided that the Company shall not be required to (1) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (2) file any general consent to service of process in any such jurisdiction or (3) subject itself to taxation in any such jurisdiction if it is not so subject;

(vi)           notify counsel for the Initial Purchasers and, in the case of a Shelf Registration, notify each Holder of Registrable Securities and counsel for such Holders promptly and, if requested by any such Holder or counsel, confirm such advice in writing (1) when a Registration Statement has become effective, when any post-effective amendment thereto has been filed and becomes effective, when any Free Writing Prospectus has been filed or any amendment or supplement to the Prospectus or any Free Writing Prospectus has been filed, (2) of any request by the SEC or any state securities authority for amendments and supplements to a Registration Statement, Prospectus or any Free Writing Prospectus or for additional information relating to the Registration Statement after the Registration Statement has become effective, (3) of the issuance by the SEC or any state securities authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose, including the receipt by the Company of any notice of objection of the SEC to the use of a Shelf Registration Statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act, (4) if, between the applicable effective date of a Shelf Registration Statement and the closing of any sale of Registrable Securities covered thereby, the representations and warranties of the Company contained in any underwriting agreement, securities sales agreement or other similar agreement, if any, relating to an offering of such Registrable Securities cease to be true and correct in all material respects or if the Company receives any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation of any proceeding for such purpose, (5) of the happening of any event during the period a Registration Statement is effective that makes any statement made in such Registration Statement or the related Prospectus or any Free Writing Prospectus untrue in any material respect or that requires the making of any changes in such Registration Statement or Prospectus or any Free Writing Prospectus in order to make the statements therein not misleading and (6) of any determination by the Company that a post-effective amendment to a Registration Statement or any amendment or supplement to the Prospectus or any Free Writing Prospectus would be appropriate;

(vii)           use its reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of a Registration Statement or, in the case of a Shelf Registration, the resolution of any objection of the SEC pursuant to Rule 401(g)(2), including by filing an amendment to such Shelf Registration Statement on the proper form, at the earliest possible moment and provide prompt notice to each Holder of the withdrawal of any such order or such resolution;

(viii)           in the case of a Shelf Registration, furnish to each Holder of Registrable Securities upon request, without charge, at least one conformed copy (to be signed by authorized signatories of the Company) of each Registration Statement and any post-effective amendment thereto (without any documents incorporated therein by reference or exhibits thereto, unless requested);

(ix)           in the case of a Shelf Registration, cooperate with the Holders of Registrable Securities to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold and not bearing any restrictive legends and enable such Registrable Securities to be issued in such denominations and registered in such names (consistent with the provisions of the Indenture) as such Holders may reasonably request at least one (1) Business Day prior to the closing of any sale of Registrable Securities;

(x)           in the case of a Shelf Registration, upon the occurrence of any event contemplated by Section 3(a)(vi)(5) hereof, use its reasonable best efforts to prepare and file with the SEC a supplement or post-effective amendment to such Shelf Registration Statement or the related Prospectus or any Free Writing Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered (or, to the extent permitted by law, made available) to purchasers of the Registrable Securities, such Prospectus or Free Writing Prospectus, as the case may be, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and the Company shall notify the Holders of Registrable Securities to suspend use of the Prospectus or any Free Writing Prospectus as promptly as practicable after the occurrence of such an event, and such Holders hereby agree to suspend use of the Prospectus or any Free Writing Prospectus, as the case may be, until the Company has amended or supplemented the Prospectus or the Free Writing Prospectus, as the case may be, to correct such misstatement or omission;

(xi)           a reasonable time prior to the filing of any Registration Statement, any Prospectus, any Free Writing Prospectus, any amendment to a Registration Statement or amendment or supplement to a Prospectus or a Free Writing Prospectus after initial filing of a Registration Statement, provide copies of such document to the Initial Purchasers and their counsel and make such of the representatives of the Company as shall be reasonably requested by the Initial Purchasers or their counsel available for discussion of such document; and the Company shall not, at any time after initial filing of a Registration Statement, use or file any Prospectus, any Free Writing Prospectus, any amendment of or supplement to a Registration Statement, a Prospectus or a Free Writing Prospectus of which the Initial Purchasers and their counsel shall not have previously been advised and furnished a copy or to which the Initial Purchasers or their counsel shall reasonably object;

(xii)           obtain a CUSIP number for all Exchange Securities or Registrable Securities, as the case may be, not later than the initial effective date of a Registration Statement;

(xiii)           cause the Indenture to be qualified under the Trust Indenture Act in connection with the registration of the Exchange Securities or Registrable Securities, as the case may be; cooperate with the Trustee and the Holders to effect such changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and execute, and use its reasonable best efforts to cause the Trustee to execute, all documents as may be required to effect such changes and all other forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a timely manner;

(xiv)           in the case of a Shelf Registration, make available for inspection by any Underwriter participating in any disposition pursuant to such Shelf Registration Statement, any attorneys and accountants designated by Holders of a majority in aggregate principal amount of the Registrable Securities to be included in such Shelf Registration and any attorneys and accountants designated by such Underwriter, at reasonable times and in a reasonable manner, all pertinent financial and other records, documents and properties of the Company and its subsidiaries, and cause the respective officers, directors and employees of the Company to supply all information reasonably requested by any such Underwriter, attorney or accountant in connection with a Shelf Registration Statement; in each case, as shall be reasonably necessary to enable such persons to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act; provided that if any such information is identified by the Company as being confidential or proprietary, each Person receiving such information shall take such actions as are reasonably necessary to protect the confidentiality of such information to the extent such action is otherwise not inconsistent with, an impairment of or in derogation of the rights and interests of any Holder or Underwriter hereunder (which actions shall include the execution of a confidentiality agreement with the Company); provided, further, that the foregoing inspection and information gathering shall be coordinated on behalf of the Holders by one counsel designated by and on behalf of such other parties as described in the definition of Registration Expenses;

(xv)           if reasonably requested by any Holder of Registrable Securities covered by a Shelf Registration Statement, promptly include in a Prospectus supplement or post-effective amendment such information with respect to such Holder as such Holder reasonably requests to be included therein and make all required filings of such Prospectus supplement or such post-effective amendment reasonably promptly thereafter; and

(xvi)           in the case of a Shelf Registration, enter into such necessary agreements and take all such other actions in connection therewith (including those reasonably requested by the Holders of a majority in principal amount of the Registrable Securities covered by the Shelf Registration Statement) in order to expedite or facilitate the disposition of such Registrable Securities including, but not limited to, an Underwritten Offering and in such connection, (1) to the extent possible, make such representations and warranties to the Holders and any Underwriters of such Registrable Securities with respect to the business of the Company and its subsidiaries, taken as a whole, and the Registration Statement, Prospectus, any Free Writing Prospectus and documents incorporated by reference or deemed incorporated by reference, if any, in each case, in form, substance and scope as are customarily made by issuers to underwriters in underwritten offerings and confirm the same if and when requested, (2) obtain opinions of counsel to the Company (which counsel and opinions, in form, scope and substance, shall be reasonably satisfactory to the Holders and such Underwriters and their respective counsel) addressed to each selling Holder and Underwriter of Registrable Securities, covering the matters customarily covered in opinions requested in underwritten offerings, (3) obtain “comfort” letters from the independent certified public accountants of the Company (and, if necessary, any other certified public accountant of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are or are required to be included in the Registration Statement) addressed to each selling Holder (to the extent permitted by applicable professional standards) and Underwriter of Registrable Securities, such letters to be in customary form and covering matters of the type customarily covered in “comfort” letters in connection with underwritten offerings, including but not limited to financial information contained in any preliminary prospectus, Prospectus or Free Writing Prospectus and (4) deliver such documents and certificates as may be reasonably requested by the Holders of a majority in principal amount of the Registrable Securities being sold or the Underwriters, and which are customarily delivered in underwritten offerings, to evidence the continued validity of the representations and warranties of the Company made pursuant to clause (1) above and to evidence compliance with any customary conditions contained in an underwriting agreement.

(b)           In the case of a Shelf Registration Statement, the Company may require each Holder of Registrable Securities to furnish to the Company such information regarding such Holder and the proposed disposition by such Holder of such Registrable Securities as the Company may from time to time reasonably request in writing and may impose reasonable deadlines in connection with the furnishing of such information, which deadlines shall (if reasonable) be binding on such Holders.

(c)           In the case of a Shelf Registration Statement, each Holder of Registrable Securities covered in such Shelf Registration Statement agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(a)(vi)(3) or 3(a)(vi)(5) hereof, such Holder will forthwith discontinue disposition of Registrable Securities pursuant to the Shelf Registration Statement until such Holder’s receipt of the copies of the supplemented or amended Prospectus and any Free Writing Prospectus contemplated by Section 3(a)(x) hereof and, if so directed by the Company such Holder will deliver to the Company all copies in its possession, other than permanent file copies then in such Holder’s possession, of the Prospectus and any Free Writing Prospectus covering such Registrable Securities that is current at the time of receipt of such notice.

(d)           If the Company shall give any notice to suspend the disposition of Registrable Securities pursuant to a Registration Statement, the Company shall extend the period during which such Registration Statement shall be maintained effective pursuant to this Agreement by the number of days during the period from and including the date of the giving of such notice to and including the date when the Holders of such Registrable Securities shall have received copies of the supplemented or amended Prospectus or any Free Writing Prospectus necessary to resume such dispositions. The Company may give any such notice only four times during any 365-day period and any such suspensions shall not exceed an aggregate of one hundred twenty (120) calendar days during any 365-day period.

(e)           The Holders of Registrable Securities covered by a Shelf Registration Statement who desire to do so may sell such Registrable Securities in an Underwritten Offering.  In any such Underwritten Offering, the investment bank or investment banks and manager or managers (each an “Underwriter”) that will administer the offering will be selected by the Holders, in consultation with the Company, of a majority of the principal amount of the Registrable Securities included in such offering.

4.           Participation of Broker-Dealers in Exchange Offer.  (a)  Certain broker-dealers may receive Exchange Securities for their own account in the Exchange Offer in exchange for Securities that were acquired by such broker-dealer as a result of market-making or other trading activities (a “Participating Broker-Dealer”) and may be deemed to be an “underwriter” within the meaning of the Securities Act and may be required to deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Securities.

The Company understands that it is the Staff’s position that if the Prospectus contained in the Exchange Offer Registration Statement includes a plan of distribution containing a statement to the above effect and the means by which Participating Broker-Dealers may resell the Exchange Securities, without naming the Participating Broker-Dealers or specifying the amount of Exchange Securities owned by them, such Prospectus may be delivered by Participating Broker-Dealers (or, to the extent permitted by law, made available to purchasers) to satisfy their prospectus delivery obligation under the Securities Act in connection with resales of Exchange Securities for their own accounts, so long as the Prospectus otherwise meets the requirements of the Securities Act.

(b)           In light of the above, and notwithstanding the other provisions of this Agreement, to the extent required by the applicable rules of the SEC and if requested by a Participating Broker-Dealer, the Company agrees to amend or supplement the Prospectus contained in the Exchange Offer Registration Statement for a period of not less than forty-five (45) calendar days after the Exchange Date (as such period may be extended pursuant to Section 3(d) of this Agreement), in order to expedite or facilitate the disposition of any Exchange Securities by Participating Broker-Dealers consistent with the positions of the Staff recited in Section 4(a) above.  The Company further agrees that Participating Broker-Dealers shall be authorized to deliver such Prospectus (or, to the extent permitted by law, make available) during such period in connection with the resales contemplated by this Section 4.

5.           Indemnification and Contribution.  (a)  The Company agrees to indemnify and hold harmless each Initial Purchaser and each Holder, their respective affiliates, directors and officers and each Person, if any, who controls any Initial Purchaser or any Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all duly documented losses, claims, damages and liabilities (including, without limitation, legal fees and other reasonable expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that arise out of, or are based upon, (1) any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or any omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein not misleading, or (2) any untrue statement or alleged untrue statement of a material fact contained in any Prospectus, any Free Writing Prospectus or any “issuer information” (“Issuer Information”) filed or required to be filed pursuant to Rule 433(d) under the Securities Act, or any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Initial Purchaser or information relating to any Holder furnished to the Company in writing through any Initial Purchaser or any selling Holder, respectively, expressly for use therein.  In connection with any Underwritten Offering permitted by Section 3, the Company will also indemnify the Underwriters, if any, participating in the distribution, their respective affiliates and each Person who controls such Persons (within the meaning of the Securities Act and the Exchange Act) to the same extent as provided above with respect to the indemnification of the Holders, if requested in connection with any Registration Statement, any Prospectus, any Free Writing Prospectus or any Issuer Information.

(b)           Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, the Initial Purchasers and the other selling Holders, the directors of the Company, each officer of the Company who signed the Registration Statement and each Person, if any, who controls the Company, any Initial Purchaser and any other selling Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any duly documented losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Holder furnished to the Company in writing by such Holder expressly for use in any Registration Statement, any Prospectus and any Free Writing Prospectus.

 

 

(c)           If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any Person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such Person (the “Indemnified Person”) shall promptly notify the Person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under this Section 5 except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under this Section 5.  If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 5 in such proceeding that the Indemnifying Person may designate and shall pay the fees and expenses of such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred.  In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and reasonable and documented expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them.  It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as they are incurred.  Any such separate firm (x) for any Initial Purchaser, its affiliates, directors and officers and any control Persons of such Initial Purchaser shall be designated in writing by the Initial Purchasers, (y) for any Holder, its directors and officers and any control Persons of such Holder shall be designated in writing by the Majority Holders and (z) in all other cases shall be designated in writing by the Company.  The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment.  Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than forty five (45) calendar days after receipt by the Indemnifying Person of such request, (ii) such Indemnifying Person shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) the Indemnifying Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement.  No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or was threatened to be made a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (A) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (B) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.

(d)           If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company from the offering of the Securities and the Exchange Securities, on the one hand, and by the Holders from receiving Securities or Exchange Securities registered under the Securities Act, on the other hand, or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Company on the one hand and the Holders on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative fault of the Company on the one hand and the Holders on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Holders and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(e)           The Company and the Holders agree that it would not be just and equitable if contribution pursuant to this Section 5 were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above.  The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim.  Notwithstanding the provisions of this Section 5, in no event shall a Holder be required to contribute any amount in excess of the amount by which the total price at which the Securities or Exchange Securities sold by such Holder exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.  The Holders’ obligations to contribute pursuant to this Section (5) are several and not joint.

(f)           The remedies provided for in this Section 5 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at law or in equity.

(g)           The indemnity and contribution provisions contained in this Section 5 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of the Initial Purchasers or any Holder or any Person controlling any Initial Purchaser or any Holder, or by or on behalf of the Company or the officers or directors of or any Person controlling the Company, (iii) acceptance of any of the Exchange Securities and (iv) any sale of Registrable Securities pursuant to a Shelf Registration Statement.

6.           General.

(a)           No Inconsistent Agreements.   The Company represents, warrants and agrees that (i) the rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of any other outstanding securities issued or guaranteed by the Company under any other agreement and (ii) the Company has not entered into, or on or after the date of this Agreement will not enter into, any agreement that is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof.

(b)           Amendments and Waivers.   The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given unless the Company has obtained the written consent of Holders of at least a majority in aggregate principal amount of the outstanding Registrable Securities affected by such amendment, modification, supplement, waiver or consent; provided that no amendment, modification, supplement, waiver or consent to any departure from the provisions of Section 5 hereof shall be effective as against any Holder of Registrable Securities unless consented to in writing by such Holder.  Any amendments, modifications, supplements, waivers or consents pursuant to this Section 6(b) shall be by a writing executed by each of the parties hereto.

(c)           Notices.  All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, telecopier, or any courier guaranteeing overnight delivery (i) if to a Holder, at the most current address given by such Holder to the Company by means of a notice given in accordance with the provisions of this Section 6(c), which address initially is, with respect to the Initial Purchasers, the address set forth in the Purchase Agreement; (ii) if to the Company initially at the Company’s address set forth in the Purchase Agreement and thereafter at such other address, notice of which is given in accordance with the provisions of this Section (6)(c); and (iii) to such other persons at their respective addresses as provided in the Purchase Agreement and thereafter at such other address, notice of which is given in accordance with the provisions of this Section 6(c).  All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five (5) Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if telecopied; and on the next Business Day if timely delivered to an air courier guaranteeing overnight delivery.  Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee, at the address specified in the Indenture.

(d)           Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors, assigns and transferees of each of the parties, including, without limitation and without the need for an express assignment, subsequent Holders; provided that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities in violation of the terms of the Purchase Agreement or the Indenture.  If any transferee of any Holder shall acquire Registrable Securities in any manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject to all the terms of this Agreement, and by taking and holding such Registrable Securities such Person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement and such Person shall be entitled to receive the benefits hereof.  The Initial Purchasers (in their capacity as Initial Purchasers) shall have no liability or obligation to the Company with respect to any failure by a Holder to comply with, or any breach by any Holder of, any of the obligations of such Holder under this Agreement.

(e)           Third Party Beneficiaries.  Each Holder shall be a third party beneficiary to the agreements made hereunder between the Company on the one hand, and the Initial Purchasers, on the other hand, and shall have the right to enforce such agreements directly to the extent it deems such enforcement necessary or advisable to protect its rights or the rights of other Holders hereunder.

(f)           Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(g)           Headings.  The headings in this Agreement are for convenience of reference only, are not a part of this Agreement and shall not limit or otherwise affect the meaning hereof.

(h)           Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

(i)           Entire Agreement; Severability.  This Agreement contains the entire agreement between the parties relating to the subject matter hereof and supersedes all oral statements and prior writings with respect thereto.  If any term, provision, covenant or restriction contained in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable or against public policy, the remainder of the terms, provisions, covenants and restrictions contained herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated.  The Company and the Initial Purchasers shall endeavor in good faith negotiations to replace the invalid, void or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, void or unenforceable provisions.

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

ILLINOIS TOOL WORKS INC.

By: /s/ Ronald D. Kropp                                                                

       Name: Ronald D. Kropp

       Title: Senior Vice President &

   Chief Financial Officer

By: /s/ James H. Wooten, Jr.                                                                           

       Name: James H. Wooten, Jr.

       Title: Senior Vice President,

   General Counsel & Secretary

  

  

  

Confirmed and accepted as of the date first above written:

J.P. MORGAN SECURITIES LLC

By: /s/ Maria Sramek____________

Authorized Signatory

MERRILL LYNCH, PIERCE, FENNER & SMITH

INCORPORATED

By: /s/ Laurie Campbell__________

Authorized Signatory

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