Document:

exv10w25

 

Exhibit 10.25

February 6, 2006

Mr. John E. Vollmer

Patterson-UTI Energy, Inc.

5956 Sherry Lane

Suite 1365

Dallas, Texas 75225

Dear John:

     As you know Patterson-UTI Energy, Inc. recently asked you to accept the position of Chief
Financial Officer of the Company upon the resignation of Jody Nelson. You responded to the request
and on November 2, 2005, the Board appointed you to the position. Subsequent to that day the Board
and you learned of the substantial defalcation by Mr. Nelson and, upon your recommendation, the
Company announced its intention to restate certain of its financial statements on account thereof.

     You have been instrumental in enabling the Company to quickly address issues and concerns that
have arisen as a result of Mr. Nelson’s defalcation and the Board of Directors very much
appreciates your efforts to date. It is extremely important to the Company that you continue as
its Chief Financial Officer as the Company investigates the actions of Mr. Nelson, seeks recovery
from him and makes its decisions as to appropriate actions to take, particularly with respect to
the Company’s financial statements and controls, including completing the fiscal 2005 audit.

     You have expressed concern that by becoming and remaining the Chief Financial Officer of the
Company you may be subject to the forfeiture provisions of Section 304 of the Sarbanes-Oxley Act of
2002 in the event the Company restates its prior financial statements as a result of the misconduct
by Mr. Nelson, even though you were not the Chief Financial Officer of the Company during any of
the periods that would be covered by such restatements. In addition, you have expressed concerns
that income or gain realized by you through exercise of stock options, vesting of restricted stock
units or sale of equity of the Company, in each case acquired by you prior to becoming Chief
Financial Officer or upon exercise of options or vesting of restricted stock units received by you
prior to becoming Chief Financial Officer, may be subject to recovery by the Company pursuant to
Section 304 in the event of the restatement of financial statements of the Company that were issued
while you are Chief Financial Officer even though the Company has no indication that such
restatement resulted from misconduct on your part. The Company understands that you have these
concerns because of the breadth of the language

 

 

John E. Vollmer

February 6, 2006

Page 2

of Section 304 and uncertainty as to how the
statute may be interpreted by the courts. You point out that if the Company were to hire a new
Chief Financial Officer from outside the Company, that person would not have placed at risk his or
her compensation and equity value from his or her former employers in a similar fashion.

     The Audit Committee of the Board of Directors and the Board of Directors believe that your
continued service is vital to the Company at this time. Therefore, to induce you to continue to be
the Chief Financial Officer of the Company, the Company agrees, to the fullest extent it may
legally do so, that it is not entitled to and will not make any claim against you for reimbursement
of any bonus or other incentive or equity based compensation received by you or any profits
realized by you from the sale of securities of the Company, under Section 304 on account of the
restatement of any financial statements of the Company covering any accounting period ending on or
prior to September 30, 2005; provided that the foregoing shall not apply if it is determined by a
final judgment of a court of competent jurisdiction, after exhaustion of all available appeals,
that the applicable accounting restatement resulted from a material non-compliance by the Company
with financial reporting requirements under the federal securities laws as a result of knowing
misconduct by you.

     Further, the Company agrees to the fullest extent it may legally do so, that it will not make
any claim against you for any profits realized from the sale of securities of the Company that were
owned by you prior to your becoming Chief Financial Officer or were acquired by you on account of
the exercise of options or the settling of restricted stock units that were held by you immediately
prior to you becoming Chief Financial Officer, under Section 304 on account of the restatement of
any financial statements of the Company covering any period during which you were Chief Financial
Officer; provided the foregoing shall not apply if it is determined by final judgment of a court of
competent jurisdiction after exhaustion of all available appeals, that the applicable accounting
restatement resulted from a material non-compliance by the Company with financial reporting
requirements under the federal securities laws as a result of knowing misconduct by you.

     In addition, to the fullest extent permitted by law, the Company agrees to indemnify and hold
you harmless from and against all loss, cost and expense incurred by you, and to pay such expenses
as and when incurred, in connection with your defense of any claim asserted against you to the
effect that you are obligated to reimburse the Company for any bonus or other incentive or equity
compensation received by you or any profits realized by you from the sale of securities of the
Company, under Section 304 in contravention of the immediately preceding two paragraphs; provided
that the foregoing shall not apply if it is determined by a final judgment of a court of competent
jurisdiction, after exhaustion of all available appeals, that the applicable accounting restatement
resulted from a material non-compliance by the Company with financial reporting requirements under
the federal securities laws as a result of knowing misconduct by you.

     You acknowledge that the Company has advised you and you understand that the Securities and
Exchange Commission may, independent of the Company, have the right to seek reimbursement for the
Company under Section 304 and the Company makes no representation,

 

 

John E. Vollmer

February 6, 2006

Page 2

and can provide no assurance,
that the Company’s agreements herein will be binding upon or otherwise restrict or limit the SEC’s
ability to obtain such reimbursement.

     Neither anything in this letter nor your acceptance hereof shall be construed as an
acknowledgment by you or the Company that Section 304 has any applicability to you with respect to
any accounting restatement with respect to accounting periods during which you were not Chief
Financial Officer of the Company.

     The Company appreciates your continued service to it.

	 	 	 	 	 
	 	Very truly yours,

PATTERSON-UTI ENERGY, INC.

 	 
	 	By:exv10w1

 

EXECUTION COPY

$1,750,000,000

AMENDMENT NO. 2

dated as of April 28, 2006

to the Five-Year Credit Agreement

dated as of July 28, 2003

among

Textron Financial Corporation

The Banks Listed Herein

and

JPMorgan Chase Bank, N.A.,

as Administrative Agent

 

J.P. Morgan Securities Inc.

and

Banc of America Securities LLC,

Lead Arrangers and Joint Bookrunners

Bank of America, N.A.,

Syndication Agent

Barclays Bank PLC

Citibank, N.A.

and

Deutsche Bank Securities Inc.,

Documentation Agents

 

 

AMENDMENT NO. 2 TO FIVE-YEAR CREDIT AGREEMENT

     AMENDMENT dated as of April 28, 2006 to the Five-Year Credit Agreement dated as of July 28,
2003 (as heretofore amended, the “Credit Agreement”) among TEXTRON FINANCIAL CORPORATION (the
“Borrower”), the BANKS party thereto (the “Banks”) and JPMORGAN CHASE BANK, N.A., as Administrative
Agent (the “Administrative Agent”).

W I T N E S S E T H :

     WHEREAS, the parties hereto desire to amend the Credit Agreement as set forth herein;

     NOW, THEREFORE, the parties hereto agree as follows:

     Section 1. Defined Terms; References. Unless otherwise
specifically defined herein, each term used herein that is defined in the Credit Agreement has the
meaning assigned to such term in the Credit Agreement. Each reference to “hereof”, “hereunder”,
“herein” and “hereby” and each other similar reference and each reference to “this Agreement” and
each other similar reference contained in the Credit Agreement shall, after this Amendment becomes
effective, refer to the Credit Agreement as amended hereby.

     Section 2. Amendments.

     (a) The definition of “Bank” in Section 1.01 of the Credit Agreement is amended to read as
follows:

     “Bank” means each bank or other financial institution listed on the signature pages
hereof and each Person which becomes a Bank pursuant to Section 2.17, 8.06, or 9.06(c),
and their respective successors.

     (b) The definition of “Termination Date” in Section 1.01 of the Credit Agreement is amended by
changing the date specified therein from “July 25, 2010” to “April 28, 2011”.

     (c) Section 2.17(a) of the Credit Agreement is amended by changing the amount specified
therein from “$333,000,000” to “$250,000,000”.

     (d) Section 2.19 of the Credit Agreement is amended to read as follows:

     Section 2.19. Extension Option. (a) The Termination Date may be extended in the
manner set forth in this Section for a period of one year from the Termination Date then
in effect; provided that the Termination Date may only be extended for two additional one
year periods. If the

 

 

Borrower wishes to request an extension of the Termination Date, the Borrower shall give
written notice to that effect to the Administrative Agent not less than 45 days nor more
than 90 days prior to each anniversary of the date hereof that occurs on or prior to the
Termination Date then in effect, whereupon the Administrative Agent shall promptly notify
each of the Banks of such request. Each Bank will use its best efforts to respond to such
request, whether affirmatively or negatively, as it may elect in its sole and absolute
discretion, within 30 days of such notice to the Administrative Agent. If any Bank shall
not have responded affirmatively within such 30-day period, such Bank shall be deemed to
have rejected the Borrower’s proposal to extend its Commitment and only the Commitments of
those Banks which have responded affirmatively shall be extended, subject to receipt by
the Administrative Agent of counterparts of an Extension Agreement in substantially the
form of Exhibit L hereto (the “Extension Agreement”) duly completed and signed by the
Borrower, the Administrative Agent and all of the Banks which have responded
affirmatively. No extension of the Commitments pursuant to this Section 2.19 shall be
legally binding on any party hereto unless and until such Extension Agreement is so
executed and delivered by Banks having at least 66 2/3% of the aggregate amount of the
Commitments.

     (b) If any Bank rejects, or is deemed to have rejected, the Borrower’s proposal to
extend its Commitment, (A) this Agreement shall terminate on the Termination Date then in
effect with respect to such Bank, (B) the Borrower shall pay to such Bank on such
Termination Date any amounts due and payable to such Bank on such date and (C) the
Borrower may, if it so elects, designate a Person not theretofore a Bank and acceptable to
the Administrative Agent to become a Bank, or agree with an existing Bank that such Bank’s
Commitment shall be increased, provided that any designation or agreement may not increase
the aggregate amount of the Commitments. Upon execution and delivery by the Borrower and
such replacement Bank or other Person of an instrument of assumption in form and amount
satisfactory to the Administrative Agent and execution and delivery of the Extension
Agreement pursuant to Section 2.19(a), such existing Bank shall have a Commitment as
therein set forth or such other Person shall become a Bank with a Commitment as therein
set forth and all the rights and obligations of a Bank with such a Commitment hereunder.
On the date of termination of any Bank’s Commitment as contemplated by this subsection
(b), the respective participations of the other Banks in all outstanding Letters of Credit
shall be redetermined on the basis of their respective Commitments after giving effect to
such termination, and the participation therein of the Bank whose Commitment is terminated
shall terminate; provided that the Borrower

3

 

shall, if and to the extent necessary to permit such redetermination of participations in
Letters of Credit within the limits of the Commitments which are not terminated, prepay on
such date a portion of the outstanding Loans, and such redetermination and termination of
participations in outstanding Letters of Credit shall be conditioned upon its having done
so.

     (c) The Administrative Agent shall promptly notify the Banks of the effectiveness of
each extension of the Commitments pursuant to this Section 2.19.

     (e) Section 4.04(a) of the Credit Agreement is amended by changing the reference to the date
“January 1, 2005” to “December 31, 2005” and the reference to “Borrower’s 2004 Annual Report” to
“Borrower’s 2005 Annual Report”.

     (f) Section 4.04(c) of the Credit Agreement is amended by changing the reference to the date
“March 31, 2005” to “December 31, 2005”.

     (g) Section 4.04(b) of the Credit Agreement is deleted.

     Section 3. Changes in Commitments. With effect from and including the Amendment Effective
Date, (i) the Commitment of each Bank shall be the amount set forth opposite the name of such Bank
in the Commitment Schedule attached hereto and (ii) the Commitment Schedule attached hereto shall
replace the Commitment Schedule attached to the Credit Agreement. On the Amendment Effective Date,
any Bank party to the Credit Agreement which is not listed in the Commitment Schedule attached
hereto (each, an “Exiting Bank”) shall cease to be a Bank party to the Credit Agreement, and all
accrued fees and other amounts payable under the Credit Agreement for the account of each Exiting
Bank shall be due and payable on such date; provided that the provisions of Sections 8.03, 8.04 and
9.03 of the Credit Agreement shall continue to inure to the benefit of each Exiting Bank after the
Amendment Effective Date.

     Section 4. Changes in Pricing Schedule. The Pricing Schedule attached to the Credit
Agreement (the “Existing Pricing Schedule”) is deleted and replaced by the Pricing Schedule
attached to this Amendment (the “New Pricing Schedule”). The New Pricing Schedule shall apply to
interest and fees accruing under the Credit Agreement on and after the date hereof. The Existing
Pricing Schedule shall continue to apply to interest and fees accruing under the Credit Agreement
prior to the date hereof.

     Section 5. Representations of Borrower. The Borrower represents
and warrants that (i) the representations and warranties of the Borrower set forth in Article 4 of
the Credit Agreement will be true on and as of the Amendment Effective Date and (ii) no Event of
Default will have occurred and be continuing on such date.

4

 

     Section 6. Effect of Amendments. Except as expressly set forth herein, the amendments
contained herein shall not constitute a waiver or amendment of any term or condition of the Credit
Agreement, and all such terms and conditions shall remain in full force and effect and are hereby
ratified and confirmed in all respects.

     Section 7. Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of New York.

     Section 8. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

     Section 9. Effectiveness. This Amendment shall become effective
as of the date hereof (the “Amendment Effective Date”), subject to satisfaction of the following
conditions:

     (a) the Administrative Agent shall have received from each of the parties listed in the
signature pages hereof a counterpart hereof signed by such party or facsimile or other
written confirmation (in form satisfactory to the Administrative Agent) that such party has
signed a counterpart hereof; and

     (b) the Administrative Agent shall have received an opinion of the General Counsel or
Assistant General Counsel of the Borrower dated as of the Amendment Effective Date, in form
and substance satisfactory to the Administrative Agent; and

     (c) the Administrative Agent shall have received evidence satisfactory to it that no
loans are outstanding under the 364-Day Credit Agreement dated as of July 8, 2003, as
amended, among the Borrower, the Banks parties thereto and JPMorgan Chase Bank, N.A., as
Administrative Agent (the “Existing 364-Day Credit Agreement”).

The Borrower and the other parties hereto, which other parties comprise the “Required Banks” as
defined in the Existing 364-Day Credit Agreement, hereby agree that the “Commitments” under the
Existing 364-Day Credit Agreement shall terminate automatically upon the effectiveness of this
Amendment, without need for notice or other action by any party, and that accrued facility fees and
any other amounts payable under the Existing 364-Day Credit Agreement shall be due and payable at
such time.

5

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written.

	 	 	 	 	 	 	 
	 	 	TEXTRON FINANCIAL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ B. F. Lynn	 	 
	 

	 	 	 	 

Name: Brian F. Lynn
	 	 
	 

	 	 	 	Title: Senior Vice President & Treasurer	 	 

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., as
Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Randolph Cates	 	 
	 

	 	 	 	 

Name: Randolph Cates
	 	 
	 

	 	 	 	Title: Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Randolph Cates	 	 
	 

	 	 	 	 

Name: Randolph Cates
	 	 
	 

	 	 	 	Title: Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ S. H. Gurnani	 	 
	 

	 	 	 	 

Name: Sanjay H. Gurnani
	 	 
	 

	 	 	 	Title: Senior Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	CITIBANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Diane L. Pockaj	 	 
	 

	 	 	 	 

Name: Diane L. Pockaj
	 	 
	 

	 	 	 	Title: Managing Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	BARCLAYS BANK PLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Nicholas Bell	 	 
	 

	 	 	 	 

Name: Nicholas Bell
	 	 
	 

	 	 	 	Title: Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK AG NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Y. Tilden	 	 
	 

	 	 	 	 

Name: Yvonne Tilden
	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ D. G. Dickinson	 	 
	 

	 	 	 	 

Name: David G. Dickinson, Jr.
	 	 
	 

	 	 	 	Title: Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	BANK OF TOKYO-MITSUBISHI UFJ

TRUST COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Christopher J. DeLauro	 	 
	 

	 	 	 	 

Name: Christopher J. DeLauro
	 	 
	 

	 	 	 	Title: Assistant Vice President	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	BNP PARIBAS	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Richard Pace	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Richard Pace	 	 
	 

	 	 	 	Title:
	 	Managing Director	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Angela B. Arnold	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Angela B. Arnold	 	 
	 

	 	 	 	Title:
	 	Director	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	CREDIT SUISSE, Cayman Islands Branch	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Jay Chall	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Jay Chall	 	 
	 

	 	 	 	Title:
	 	Director	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ James Neira	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	James Neira	 	 
	 

	 	 	 	Title:
	 	Associate	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	HSBC BANK USA, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ C J Wannea	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	C J Wannea	 	 
	 

	 	 	 	Title:
	 	Head of Transport, Services and Infrastructure	 	 
	 

	 	 	 	 	 		 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	MERRILL LYNCH BANK USA	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Louis Alder	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Louis Alder	 	 
	 

	 	 	 	Title:
	 	Director	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	MORGAN STANLEY BANK	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Daniel Twenge	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Daniel Twenge	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 

	 	 	 	 	 	Morgan Stanley Bank	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	UBS LOAN FINANCE LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Marc Sileo	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Marc Sileo	 	 
	 

	 	 	 	Title:
	 	Associate Director	 	 
	 

	 	 	 	 	 	Banking Products	 	 
	 

	 	 	 	 	 	Services, US	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Douglas Gervolino	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Douglas Gervolino	 	 
	 

	 	 	 	Title:
	 	Associate Director	 	 
	 

	 	 	 	 	 	Banking Products	 	 
	 

	 	 	 	 	 	Services, US	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Nathan R. Rantala	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Nathan R. Rantala	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	WILLIAM STREET
COMMITMENT CORPORATION
(Recourse only to assets
of William Street
Commitment Corporation)	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Mark Walton	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Mark Walton	 	 
	 

	 	 	 	Title:
	 	Assistant Vice President	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	HARRIS NESBITT FINANCING, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Joseph W. Linder	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Joseph W. Linder	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	THE BANK OF NOVA SCOTIA	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Pieter J. Van Schaick
 

Name: Pieter J. Van Schaick
	 	 
	 

	 	 	 	Title: Managing Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	SOCIETE GENERALE	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ambrish D. Thanawala
 

Name: Ambrish D. Thanawala
	 	 
	 

	 	 	 	Title: Managing Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Patrick Vatel
 

Name: Patrick Vatel
	 	 
	 

	 	 	 	Title: Managing Director	 	 

 

 

	 	 	 	 	 	 	 
	 	 	MELLON BANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Laurie G. Dunn
 

Name: Laurie G. Dunn
	 	 
	 

	 	 	 	Title: First Vice President	 	 

 

 

COMMITMENT SCHEDULE

	 	 	 	 	 
	Bank	 	Commitment	 
	JPMorgan Chase Bank, N.A.
	 	$	160,000,000	 
	Bank of America, N.A.
	 	$	160,000,000	 
	Citibank, N.A.
	 	$	130,000,000	 
	Barclays Bank PLC
	 	$	130,000,000	 
	Deutsche Bank AG New York Branch
	 	$	130,000,000	 
	Bank of Tokyo-Mitsubishi UFJ Trust Company
	 	$	90,000,000	 
	BNP Paribas
	 	$	90,000,000	 
	Credit Suisse First Boston, acting
through its Cayman Islands Branch
	 	$	90,000,000	 
	HSBC Bank USA, National Association
	 	$	90,000,000	 
	Merrill Lynch Bank USA
	 	$	90,000,000	 
	Morgan Stanley Bank
	 	$	90,000,000	 
	UBS Loan Finance LLC
	 	$	90,000,000	 
	Wachovia Bank, National Association
	 	$	90,000,000	 
	William Street Commitment Corporation
	 	$	90,000,000	 
	Harris Nesbitt Financing, Inc.
	 	$	65,000,000	 
	The Bank of Nova Scotia
	 	$	65,000,000	 
	Societe Generale
	 	$	45,000,000	 
	The Bank of New York
	 	$	30,000,000	 
	Mellon Bank, N.A.
	 	$	25,000,000	 
	Total
	 	$	1,750,000,000	 

 

 

PRICING SCHEDULE

     Each of “Facility Fee Rate” and “Euro-Dollar Margin” means, for any date, the rate set forth
below in the row opposite such term and in the row corresponding to the “Utilization” at such date
and, under the column corresponding to the “Pricing Level” at such date:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Level I	 	Level II	 	Level III	 	Level IV	 	Level V	 	Level VI
	Facility Fee Rate
	 	 	0.05	%	 	 	0.06	%	 	 	0.07	%	 	 	0.08	%	 	 	0.09	%	 	 	0.125	%
	Euro-Dollar Margin
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Utilization £ 50%
	 	 	0.125	%	 	 	0.14	%	 	 	0.18	%	 	 	0.37	%	 	 	0.535	%	 	 	0.625	%
	Utilization > 50%
	 	 	0.175	%	 	 	0.19	%	 	 	0.23	%	 	 	0.42	%	 	 	0.585	%	 	 	0.675	%
	Letter of Credit Fees
	 	 	0.175	%	 	 	0.19	%	 	 	0.23	%	 	 	0.42	%	 	 	0.585	%	 	 	0.675	%

     For purposes of this Schedule, the following terms have the following meanings, subject
to the concluding paragraph of this Schedule with respect to split ratings:

     “Level I Pricing” applies at any date if, at such date, the Borrower’s long-term debt is rated
A+ or higher by S&P, A1 or higher by Moody’s and A+ or higher by Fitch.

     “Level II Pricing” applies at any date if, at such date, the Borrower’s long-term debt is
rated A by S&P, A2 by Moody’s and A by Fitch.

     “Level III Pricing” applies at any date if, at such date, the Borrower’s long-term debt is
rated A- by S&P, A3 by Moody’s and A- by Fitch.

     “Level IV Pricing” applies at any date, if at such date, the Borrower’s long-term debt is
rated BBB+ by S&P, Baa1 by Moody’s and BBB+ by Fitch.

     “Level V Pricing” applies at any date if, at such date, the Borrower’s long-term debt is rated
BBB by S&P, Baa2 by Moody’s and BBB by Fitch.

     “Level VI Pricing” applies at any date if, at such date, no other Pricing Level applies.

     “Fitch” means Fitch Ratings Ltd.

     “Moody’s” means Moody’s Investors Service, Inc.

 

 

     “Pricing Level” refers to the determination of which of Level I, Level II, Level III, Level
IV, Level V or Level VI applies at any date.

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

     “Utilization” means, at any date, the percentage equivalent of a fraction (i) the numerator of
which is the Total Outstanding Amount at such date (after giving effect to any borrowing or payment
on such date) and the denominator of which is the aggregate amount of the Commitments at such date
(after giving effect to any reduction on such date). If for any reason any Loans or Letter of
Credit Liabilities remain outstanding after termination of the Commitments, Utilization shall be
deemed to be 100%.

     The credit ratings to be utilized for purposes of this Schedule are those assigned to the
senior unsecured long-term debt securities of the Borrower without third-party enhancement (other
than the Textron Inc. Support Agreement), and any rating assigned to any other debt security of the
Borrower shall be disregarded. The rating in effect at any date is that in effect at the close of
business of such date.

     If the Borrower is split-rated, then for purposes of determining the applicable Pricing Level,
(a) if the S&P and Moody’s ratings are the same, all three ratings will be deemed at that level,
(b) if the S&P and Moody’s ratings are not the same and the ratings differential is one level, then
all three ratings will be deemed to be at the higher level of S&P and Moody’s and (c) if the S&P
and Moody’s ratings are not the same and the ratings differential is two levels or more, then all
three ratings will be deemed to be at a level one notch lower than the higher of S&P and Moody’s.

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