Document:

b01078_s8may20x102.htm

 

Exhibit 10.2

 

BARNES GROUP INC.

RETIREMENT SAVINGS PLAN

As Amended and Restated Effective July 1, 2009

  

  

  

TABLE OF CONTENTS

	
ARTICLE 1 – DEFINITIONS

	
3

	
ARTICLE 2 – PARTICIPATION

	
13

	
2.1       PARTICIPATION

	
13

	
2.2       TRANSFERRED AND REHIRED PARTICIPANTS

	
13

	
2.3       PARTICIPATION IN PAYSOP

	
14

	
ARTICLE 3 - LIMITS ON CONTRIBUTIONS

	
15

	
3.1       BEFORE-TAX CONTRIBUTIONS

	
15

	
3.2       AFTER-TAX CONTRIBUTIONS

	
18

	
3.3       MATCHING ALLOCATIONS; COMPANY CONTRIBUTIONS

	
18

	
3.4       PROFIT SHARING CONTRIBUTIONS

	
22

	
3.5       MAXIMUM ANNUAL ADDITIONS

	
24

	
3.6       MISTAKEN CONTRIBUTIONS

	
28

	
3.7       CHANGE OF CONTRIBUTION ELECTION

	
28

	
3.8       LIMITATIONS AFFECTING HIGHLY COMPENSATED EMPLOYEES

	
29

	
3.9       NONDISCRIMINATION TESTS

	
29

	
3.10     ROLLOVER CONTRIBUTIONS

	
41

	
ARTICLE 4 - COMPANY STOCK FUND

	
43

	
4.1       CONTRIBUTIONS

	
43

	
4.2       VALUE

	
43

	
ARTICLE 4A - MERGER OF PAYSOP

	
44

	
4A.1    MERGER AND TRANSFER

	
44

	
4A.2    SEPARATE ACCOUNTS

	
44

	
4A.3    RIGHTS

	
44

	
ARTICLE 5 - INVESTMENT OF CONTRIBUTIONS

	
45

	
5.1       DIRECTED INVESTMENT ACCOUNT

	
45

	
5.2       INVESTMENT ELECTION

	
48

	
5.3       RESPONSIBILITY FOR INVESTMENTS

	
48

	
5.4       CHANGES IN INVESTMENTS

	
48

	
5.5       ACCOUNTS

	
49

	
5.6       VOTING RIGHT

	
49

	
ARTICLE 6 - VESTED PORTION OF ACCOUNTS

	
50

	
6.1       BEFORE-TAX, AFTER-TAX ACCOUNTS, ROLLOVER ACCOUNTS, AND PAYSOP ACCOUNTS

	
50

	
6.2       MATCHING AND PROFIT SHARING ACCOUNTS

	
50

	
6.3       VESTING SERVICE

	
53

	
6.4       AMENDMENT OF VESTING SCHEDULE

	
56

  

  

  

	
ARTICLE 7 - WITHDRAWALS WHILE STILL EMPLOYED

	
57

	
7.1       WITHDRAWAL OF AFTER-TAX CONTRIBUTIONS

	
57

	
7.2       WITHDRAWAL OF BEFORE-TAX CONTRIBUTIONS AND ROLLOVER CONTRIBUTIONS

	
57

	
7.3       MATCHING ACCOUNT

	
60

	
7.4       PAYSOP ACCOUNT

	
61

	
7.5       PROCEDURES AND RESTRICTIONS

	
61

	
7.6       PROFIT SHARING ACCOUNT

	
62

	
ARTICLE 8 - DISTRIBUTION OF ACCOUNTS UPON TERMINATION OF EMPLOYMENT

	
63

	
8.1       AMOUNT OF PAYMENT; PAYMENT IN COMPANY STOCK

	
63

	
8.2       METHODS OF DISTRIBUTION

	
64

	
8.3       BENEFICIARY

	
65

	
8.4       FORFEITURES

	
65

	
8.5       DISTRIBUTION OF PAYSOP ACCOUNTS

	
66

	
8.6       DIRECT ROLLOVER DISTRIBUTIONS

	
67

	
ARTICLE 9 - ADMINISTRATION OF PLAN

	
71

	
9.1       APPOINTMENT OF BENEFITS COMMITTEE

	
71

	
9.2       OPERATION OF BENEFITS COMMITTEE

	
71

	
9.3       GENERAL DUTIES OF THE BENEFITS COMMITTEE

	
72

	
9.4       BINDING ACTION

	
73

	
9.5       CLAIMS PROCEDURE

	
74

	
9.6       INDEMNITY

	
74

	
9.7       PLAN EXPENSES

	
74

	
ARTICLE 10 – LOANS

	
76

	
10.1     LOAN LIMITS

	
76

	
10.2     INTEREST

	
77

	
10.3     TERM

	
77

	
10.4     SECURITY

	
77

	
10.5     FREQUENCY/MINIMUM AMOUNTS

	
77

	
10.6     FEES

	
78

	
10.7     PARTICIPANT LOAN PROGRAM

	
78

	
ARTICLE 11 – TRUSTEE

	
80

	
11.1     TRUST

	
80

	
11.2     APPOINTMENT OF TRUSTEE

	
80

	
ARTICLE 11A - ACQUISITION OF SHARES WITH ESOP LOANS; CERTAIN ALLOCATION RULES

	
81

	
11A.1      TERMS OF ESOP LOAN

	
81

	
11A.2      ACQUISITION OF SHARES WITH PROCEEDS OF ESOP LOAN

	
82

	
11A.3      SHARES TO BE UNRESTRICTED

	
83

  

  

  

	
11A.4      ESOP LOAN AMORTIZATION PAYMENTS

	
84

	
11A.5      ESOP LOAN PAYMENTS

	
85

	
11A.6      RELEASE FROM ESOP LOAN SUSPENSE ACCOUNT

	
85

	
11A.7      USE OF DIVIDENDS

	
86

	
ARTICLE 12 - GENERAL PROVISIONS

	
88

	
12.1     EXCLUSIVE BENEFIT RULE

	
88

	
12.2     NONALIENATION

	
88

	
12.3     CONDITIONS OF EMPLOYMENT NOT AFFECTED BY PLAN

	
89

	
12.4     FACILITY OF PAYMENT

	
89

	
12.5     INFORMATION

	
89

	
12.6     CONSTRUCTION

	
90

	
12.7     INABILITY TO LOCATE DISTRIBUTEE

	
90

	
12.8     NAMED FIDUCIARIES

	
90

	
12.9     QUALIFIED DOMESTI RELATIONS ORDERS

	
91

	
ARTICLE 13 - AMENDMENT, MERGER AND TERMINATION

	
92

	
13.1     AMENDMENT OF PLAN

	
92

	
13.2     MERGER OR CONSOLIDATION

	
93

	
13.3     ADDITIONAL PARTICIPATING EMPLOYERS

	
93

	
13.4     TERMINATION OF PLAN

	
94

	
ARTICLE 14 - TOP-HEAVY PROVISIONS

	
96

	
14.1     APPLICATION OF ARTICLE

	
96

	
14.2     DEFINITIONS

	
96

	
14.3     DETERMINATION OF TOP-HEAVY STATUS

	
97

	
14.4     MINIMUM COMPANY CONTRIBUTION

	
98

	
ARTICLE 15 – MILITARY VETERANS’ MAKE-UP CONTRIBUTIONS

	
100

	
15.1     QUALIFIED MILITARY SERVICE

	
100

	
15.2     SERVICE CREDIT

	
100

	
15.3     MAKE-UP CONTRIBUTIONS

	
100

	
15.4     MAXIMUM TIME LIMIT

	
101

	
15.5     MATCHING ALLOCATIONS

	
101

	
15.6     NO RETROACTIVE INVESTMENT RETURN

	
101

	
15.7     LOAN REPAYMENTS

	
102

	
15.8     TESTING

	
102

	
15.9     COMPLIANCE

	
103

  

  

  

PREAMBLE

The purpose of the Barnes Group Inc. Retirement Savings Plan (formerly known as the Barnes Group, Inc. Guaranteed Stock Plan and herein referred to as the “Plan”) is to assist Employees in achieving financial independence at retirement and to encourage savings, as well as to enable Employees to share in the ownership of Barnes Group Inc. (the “Company”).  Effective July 28, 1989, the Plan was amended and restated to constitute an employee stock ownership plan (“ESOP”) which is intended to qualify as a stock bonus plan under Section 401(a) and as an employee stock ownership plan under Section 4975(e)(7) of the Internal Revenue Code of 1986, as amended (the “Code”).  The ESOP is designed to invest primarily in “qualifying employer securities,” as defined in Sections 4975(e)(8) and 409(1) of the Code and 407(d)(5) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).  With respect to periods commencing on and after October 1, 1989, the Plan is authorized to allocate Shares of Common Stock of the Company acquired (whether before or after such date) with the proceeds of an exempt loan to the ESOP under Section 4975(d)(3) of the Code.

Effective May 30, 2003, the Barnes Group Inc. Profit Sharing Retirement Plan and the Spectrum Plastic Molding Resources, Inc. 401(k) Profit Sharing Plan were merged into the Plan in accordance with the provisions of Section 13.2 hereof, and the accounts of the participants under such plans were be deposited in corresponding  Accounts established for them under the Plan.

The Company further amended and restated the Plan effective December 31, 2006 and is now hereby amending and restating the Plan, as hereinafter set forth, effective July 1, 2009, except as otherwise provided herein.  It is the intention of the Company that the Plan as herein amended and

  

1

  

restated shall continue to be recognized as a stock bonus plan under Section 401(a) and as an employee stock ownership plan under Section 4975(e)(7) of the Code.

  

2

  

ARTICLE 1 - DEFINITIONS

As used herein, the terms set forth below shall have the following meanings.  Some of the words and phrases used in the Plan are not defined in this Article 1, but for convenience are defined as they are introduced into the text.

	
1.1  

	
“Accounts” means the Before-Tax Account, the After-Tax Account, the Matching Account, the Prior Contributions Account, the PAYSOP Account, the ESOP Loan Suspense Account, the Rollover Account, the Merged Asset Account, the Profit Sharing Account and any other account to be established by the Benefits Committee pursuant to the terms of the Plan.

	
1.2  

	
“Affiliated Employer” means any company not participating in the Plan which is a member of a controlled group of corporations that includes the Company (determined under Section 1563(a) of the Internal Revenue Code without regard to Section 1563(a)(4) and (e)(3)(C)), except that with respect to Section 3.5 “more than 50 percent” shall be substituted for “at least 80 percent” where it appears in Section 1563(a)(4) of the Code.  The term “Affiliated Employer” shall also include any trade or business under common control (as defined in Section 414(c) of the Code) with the Company, a member of an affiliated service group (as defined in Section 414(m) of the Code), which includes the Company, and any other entity required to be aggregated with the Company under regulations issued pursuant to Code Section 414(o).

  

3

  

	
1.3  

	
“After-Tax Contributions” means all amounts contributed pursuant to Section 3.2 of the Plan.

	
1.4  

	
“Before-Tax Contributions” means all amounts contributed pursuant to Section 3.1 of the Plan.

	
1.5  

	
“Benefits Committee” means the Benefits Committee appointed by the Company's Board of Directors as provided in Article 9.

	
1.6  

	
“Board of Directors” means the Board of Directors of Barnes Group Inc.

	
1.7  

	
“Break-in-Service” means a period or event affecting the determination of a Participant's Vested Portion as provided in Article 6.

	
1.8  

	
“Code” or “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time to time.

	
1.9  

	
“Company Contributions” means contributions to the Plan made or required to be made by the Company or an Employer pursuant to Sections 3.3 or 3.4.

	
1.10  

	
“Company Stock” means any “qualifying employer security” of the Company within the meaning of Sections 4975(e)(8) and 409(1) of the Code, including common stock, $.01 par value, of the Company (“Common Stock”).

	
1.11  

	
“Compensation” means regular base pay, commissions, shift differential and overtime pay, determined prior to any reduction pursuant to Section 3.1, or by reason of the application of Code sections 125 and 132(f), but excluding bonuses, severance pay, reimbursed expenses, payment of deferred compensation, any other special payments, and any other amounts paid after the Participant severs from service with the Company, unless such amounts would otherwise constitute Compensation and are paid before the later of 2-1/2 months after the Participant severs from service or the end of the Plan year in which the severance from

  

4

  

service occurred. For this purpose, amounts under Code section 125 include any amounts not available to a Participant in cash in lieu of group health coverage because the Participant is unable to certify that he or she has other health coverage.  An amount will be treated as an amount under Code section 125 only if the Employer does not request or collect information regarding the Participant's other health coverage as part of the enrollment process for the health plan.  The annual Compensation of each Participant taken into account in determining allocations for any Plan Year shall not exceed $200,000, as adjusted for cost-of-living increases in accordance with Code section 401(a)(17)(B).  The dollar increase in effect on January 1 of any calendar year is effective for years beginning in such calendar year.  If a Plan Year consists of fewer than 12 months the annual compensation limit is an amount equal to the otherwise applicable annual compensation limit multiplied by a fraction, the numerator of which is the number of months in the short Plan Year period, and the denominator of which is 12.

	
1.12  

	
“Disability” means a condition that would qualify an Employee to receive a disability benefit under the Company's long term disability plan. If an Employee does not participate in the Company’s long-term disability plan, such Employee must be determined to be totally disabled by the United States Social Security Administration and qualify for Social Security disability payments to be treated as disabled under the Plan.

	
1.13  

	
“Effective Date” means July 1, 2009 for this restated Plan except as otherwise provided herein.  The original effective date of the Plan was April 1, 1984.

	
1.14  

	
“Eligible Employee” means an Employee who is not otherwise excluded under this Section 1.14 and is employed by an Employer in the United States as a salaried or nonunion hourly employee, and is either (a) regularly scheduled to work at least 30 hours per week, or (b)

  

5

  

regularly scheduled to work less than 30 hours per week, but who completes at least 1,000 hours of service during his initial twelve-month period of employment or during any subsequent Plan Year. In no event, however, shall the term “Eligible Employee” include a person: 

	
(i)  

	
who is a Leased Employee;

	
(ii)  

	
who is classified by the Employer as an independent contractor, as evidenced by failure to withhold taxes from his or her Compensation, regardless of how the Internal Revenue Service (“IRS”), any other governmental agency  or a court classifies the person;

	
(iii)  

	
whose Compensation is paid by the Employer other than through its payroll system, including, but not limited to, those paid through purchase order or accounts payable, regardless of how the IRS, any other governmental agency or a court classifies the person;

	
(iv)  

	
whose total Compensation from an Employer is reflected on a Form 1099, and not a W-2, regardless of how the IRS, any other governmental agency or a court classifies the person;

	
(v)  

	
who has agreed in writing to non-participant status under the Plan, regardless of how the IRS, any other governmental agency or court classifies the person;

	
(vi)  

	
who is included in a collective bargaining unit of employees, unless the Employer has agreed to treat such person as an Eligible Employee pursuant to an effective collective bargaining agreement; or

	
(vii)  

	
who is a non-resident alien and receives no earned income from any Controlled Group member which constitutes U.S. source income.

  

6

  

	
1.14A.

	
“Employee” means a person who is either (a) a common law employee or (b) a “Leased Employee of an Employer or Affiliated Employer.

	
1.15  

	
“Employer” or “Company” means Barnes Group Inc. or any successor by merger, purchase or otherwise, with respect to its employees; or any other company participating in the Plan as provided in Section 13.3, with respect to its employees.

	
1.16  

	
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

	
1.17  

	
“ESOP Effective Date” means July 28, 1989.

	
1.18  

	
[Intentionally Omitted]

	
1.19  

	
“Highly Compensated Employee” means, with respect to a Plan Year, any Employee who performs services for the Employer or an Affiliated Employer during the year being tested (the “Determination Year”) and who was a 5% owner (or the spouse of a 5% owner), within the meaning of Code section 416(i)(l)(B)(i), at any time during the Determination Year or the preceding year (the “Look-Back Year”), or who received compensation from the Employer or an Affiliated Employer in excess of $80,000 (adjusted pursuant to Code section 415(d), except that the base period is the calendar quarter ending September 30, 1996) during the Look-Back Year.  The Benefits Committee may elect that the Look-Back Year shall be the calendar year ending with or within the Determination Year.

For purposes of determining an Employee’s compensation, compensation shall mean the Employee’s total compensation reportable on Form W-2, plus all contributions made on behalf of the Employee by the Employer or an Affiliated Employer pursuant to a salary reduction agreements under Code sections 401(k), 408, 125, or 132(f).

  

7

  

A highly compensated former employee is based on the rules applicable to determining highly compensated employee status as in effect for that determination year, in accordance with section 1.414(q)-1T, A-4 of the temporary Income Tax Regulations and Notice 97-45. 

The number of Highly Compensated Employees shall not exceed 20% of Employees when ranked on the basis of compensation paid during the Look-Back Year, excluding however, Employees who:

(i)             have less than six months of eligibility service;

(ii)            are under age 21;

(iii)           ordinarily work not more than six months per year;

 

                (iv)   ordinarily work less than 17-1/2 hours per week; or

	
      (v)  

	
are included in a unit of Employees covered by a collective bargaining agreement if 90% or more of the Employer's Employees are covered by collective bargaining agreements and the Plan covers only those Employees who are not covered by such agreements.

Any Employee who is not a Highly Compensated Employee is a Nonhighly Compensated Employee.

  

8

  

	
1.19A

	
“Leased Employee” means any person (other than an Employee of the recipient) who pursuant to an agreement between the recipient and any other person (“leasing organization”) has performed services for the recipient (or for the recipient and related persons determined in accordance with Code section 414(n)(6) on a substantially full-time basis for a period of at least one year, and such services are performed under the primary direction or control of the Employer or Affiliated Employer.  A Leased Employee shall not be considered an Employee of the recipient if: (i) such employee is covered by a money purchase pension plan providing: (1) a nonintegrated employer contribution rate of at least 10 percent of compensation, as defined in Code section 415(c)(3) but including amounts contributed by the employer pursuant to a salary reduction agreement which are excludable from the employee's gross income under Code sections 125, 402(a)(8), 402(h) or 403(b), (2) immediate participation, and (3) full and immediate vesting; and (ii) Leased Employees do not constitute more than 20 percent of the recipient's nonhighly compensated workforce.

	
1.20  

	
“Matching Allocations” shall have the meaning set forth in Section 3.3 of the Plan.

	
1.21  

	
“Merged Asset Account” shall mean such amounts transferred into the Plan which are attributable to the Curtis Industries, Inc. 401(k) Retirement Savings Plan.  Salary deferral and employer matching contributions previously held under the Curtis Industries, Inc. 401(k) Retirement Savings Plan shall be separately accounted for under the Plan.

	
1.22  

	
“Participant” means any person included in the membership of the Plan as provided in Article 2.

	
1.23  

	
“Participating Divisions” means the Bowman U.S. division of the Barnes Distribution Group and the following divisions of the Barnes Aerospace Components Group:  Windsor Airmotive (East Granby, CT and West Chester, OH), Windsor, CT,

  

9

  

Lansing, MI, Ogden, UT, Phoenix, AZ, West Chester, OH, and Ceramics (Windsor, CT), and any other group designated by the Board of Directors.

	
1.24  

	
“Participating Division Employee” means any Eligible Employee of a Participating Division; provided, however, that it shall include only the following employees of the Bowman U.S. division: all persons employed by Bowman U.S. as sales employees including Account Executives, Customer Sales Representatives, Customer Representa­tives, and Service Representatives.

	
1.25  

	
“PAYSOP” means the Barnes Group Inc. Employee Stock Ownership Plan.

	
1.26  

	
“Plan” means the Barnes Group Inc. Retirement Savings Plan as set forth in this document or as amended from time to time.

	
1.27  

	
“Plan Year” meant the period beginning with the original Effective Date of the Plan through December 31, 1984, and thereafter the calendar year through December 31, 1998. Effective January 1, 1999, the Plan Year became the short plan year beginning January 1, 1999 and ending December 30, 1999, and thereafter the period beginning each December 31 and ending the following December 30.

	
1.28  

	
“Prior Contributions” means the Before-Tax, After-Tax and Matching Accounts of a Participant that remain invested in the Fixed Income Investment Fund or the Common Stock Investment Fund attributable to contributions prior to April 30, 1988.

	
1.29  

	
“Profit Sharing Contribution” means all amounts contributed pursuant to Section 3.4 of the Plan.

	
1.30  

	
“Rollover Contributions” means all amounts contributed pursuant to Section 3.10 of the Plan, provided, however, that such contributions shall not include any amounts that were after-tax contributions to the plan or account from which they were rolled over.

  

10

  

	
1.30A

	
"Qualified Domestic Relations Order"  means any judgment, decree or order (including approval of a property settlement agreement) which constitutes a "qualified domestic relations order" within the meaning of Code section 414(p) and ERISA section 206(d)(3).  A judgment, decree or order shall not fail to be a Qualified Domestic Relations Order merely because it requires a distribution to an alternate payee (or the segregation of accounts pending distribution to an alternate payee) before the Participant is otherwise entitled to a distribution under the Plan.

	
1.31  

	
“Share” means a unit of the Company Stock Fund, comprised of shares of Common Stock of the Company and an amount of short-term investments designed to allow buys and sells.

	
  

	
1.31A  “Spouse” means a Participant’s spouse as determined under the Federal Defense of Marriage Act.

	
1.32  

	
“Trustees” means the trustees by whom the funds of the Plan are held as provided in Article 11.

	
1.33  

	
“Valuation Date” means each business day of each calendar, and such other dates as may be determined by the Benefits Committee.

	
1.34  

	
“Value” means the fair market value of a Share of Common Stock, as provided in Section 4.4 of the Plan.

	
1.35  

	
“Vested Accounts” means the Before-Tax Account, the After-Tax Account, the PAYSOP Account, the Rollover Account, the Vested Portion of the Matching Account, and the Vested Portion of the Profit Sharing Account, and, if applicable, the Vested Portion of the Merged Asset Account.

  

11

  

	
1.36

	
“Vested Portion” means the portion of the Accounts in which the Participant has a nonforfeitable interest as provided in Article 6.

Whenever appropriate, words and terms defined in the singular may be read as the plural, and the plural may be read as the singular.  Unless otherwise required by the context, masculine pronouns also shall include the feminine, and the feminine shall include the masculine.

The headings of the Articles and Sections herein are included solely for convenience, and if there is any conflict between such headings and the text of the Plan, the text shall control.

  

12

  

ARTICLE 2 - PARTICIPATION

2.1           PARTICIPATION

An Eligible Employee shall become a Participant on the first day of the calendar month which is at least 30 days (or some lesser period of time designated by the Benefits Committee) after the date on which he files with the Employer a form or forms prescribed by the Benefits Committee on which he: (a) makes the election described in Section 3.1; and (b) names a Beneficiary.  Notwithstanding the foregoing, each Eligible Employee hired on or after November 1, 2005, shall be automatically enrolled as a Participant at a default Before-Tax Contribution rate of three percent (3%) of Compensation, as of the first payroll period following the 60th day after he becomes an Eligible Employee, unless the Eligible Employee affirmatively elects a different Before-Tax Contribution (including zero percent) by completing the proper form provided by the Benefits Committee.  Any such different Before-Tax Contribution election must be made within sixty days of becoming an Eligible Employee.  A Participant may elect to change the default Before-Tax Contribution percentage by such method as the Benefits Committee may prescribe.  Eligible Employees of a Participating Division need not file such forms to become Participants with respect to contributions made pursuant to Section 3.4.

2.2            TRANSFERRED AND REHIRED PARTICIPANTS

A Participant who becomes an Employee of an Affiliated Employer but ceases to be an Eligible Employee shall continue to be a Participant of the Plan but shall not be eligible to make contributions or to borrow from the Plan.  A Participant who transfers employment from an Affiliated Employer and once again becomes an Eligible Employee shall be eligible to participate in

  

13

  

the Plan pursuant to the provisions of Section 2.1.  A Participant who terminates employment and who later experiences a re-employment as an Eligible Employee shall be eligible to participate in the Plan pursuant to the provisions of Section 2.1.

2.3           PARTICIPATION IN PAYSOP

If an individual is or was a participant in the PAYSOP, and his PAYSOP Account Balance is transferred to this Plan, such individual shall be a Participant in this Plan; provided, that such Participant shall not at any time be enti­tled to any contributions solely as a result of such transfer.

  

14

  

ARTICLE 3 - LIMITS ON CONTRIBUTIONS

3.1           BEFORE-TAX CONTRIBUTIONS

	
(a)  

	
A Participant may have his Compensation reduced on a Before-Tax basis in multiples of 1% under the procedures and maximum amounts specified by the Benefits Committee and have that amount contributed to the Plan by the Employer; provided, however, that in no event may the reduction in Compensation exceed 75% of Compensation, and provided further that if a Participant elects to contribute to the Plan both on a Before-Tax and an After-Tax basis, in no event shall his aggregate Before-Tax and After-Tax Contributions exceed 75% of his Compensation.

	
(b)  

	
No Participant shall be permitted to reduce his Compensation under the foregoing provision, or any other qualified plan maintained by the Employer or any Affiliated Employer during any calendar year, in excess of the dollar limitation contained in Code section 402(g) in effect for such calendar year.

	
(c)  

	
A Participant may assign to this Plan any excess elective deferrals made during a taxable year of the Participant under the plan of another employer by notifying the Benefits Committee of the amount of the excess elective deferrals to be assigned to the Plan.  A Participant is deemed to notify the Benefits Committee of any excess elective deferrals that arise by taking into account only those Before-Tax Contributions made to this Plan and any other plans of the Employer or an Affiliated Employer.

  

15

  

	
(d)  

	
Before-Tax Contributions in excess of the maximum elective deferral, plus any income and minus any loss allocable thereto, as determined under Section 3.9(h), shall be distributed to the Participant no later than April 15 following the calendar year for which such excess deferral was made.

	
(e)  

	
In the event that Before-Tax Contributions are used to repay an ESOP Loan, and the Value of Shares released from the ESOP Loan Suspense Account and allocated to the Participant's Before-Tax Account by reason of the use of such Contributions is less than the amount of such Contributions so used, the Company shall make an additional contribution (a “Supplemental Contribution”) to the Plan in an amount sufficient to purchase Shares on the open market, or release additional shares from the ESOP Loan Suspense Account, equal in Value to such difference, and such Shares shall be allocated to the Participant's Before-Tax Account.

	
(f)  

	
Before-Tax Contributions accumulated through payroll deductions shall be paid to the Trustee as of the earliest date on which such contributions can reasonably be segregated from the Employer general assets, but in any event not later than the fifteenth (15th) business day of the month following the month during which such amounts would otherwise have been payable to the Participant in cash.  The provisions of Department of Labor regulations 2510.3-102 are incorporated herein by reference.  Furthermore, any additional Employer contributions which are allocable to the Participant’s Before-Tax Account for a Plan Year shall be paid to the Plan no later than the 12-month period immediately following the close of such Plan Year.  Notwithstanding the foregoing, in no event shall Before-Tax

  

16

  

Contributions be paid to the Trustee (i) before the Participant has elected to make such contributions pursuant to Section 3.1 or is treated as having made a default election under Section 2.1 and (ii) before the earlier of (A) the Participant’s performance of services that relate to the Compensation that, but for the Participant’s election, would have been paid to the Participant or (B) the date the Compensation is made currently available to the Participant.  Notwithstanding anything to the contrary in the immediately preceding sentence, Before-Tax Contributions may be made prior to the performance of the services related to such contributions in order to accommodate a bona fide administrative consideration to the extent permitted under Code section 401(k) and the regulations and other guidance issued thereunder.

	
(g)  

	
A Participant who has attained at least age 50 before the end of the calendar year shall be permitted to elect additional Before-Tax Contributions (“Catch-Up Contributions”) with respect to such calendar year in accordance with, and subject to the limitations of, Code section 414(v).  Catch-Up Contributions may be elected in addition to any other Before-Tax Contributions elected by the Participant.  An eligible Participant may contribute Catch-Up Contributions through regular payroll deductions in multiples of 1% under procedures specified by the Benefits Committee.

	
  

	
(i)

	
Catch-Up Contributions shall not be taken into account for purposes of the provisions of the Plan implementing Code sections 402(g) and 415.  The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing

  

17

  

the requirements of Code sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416, as applicable, by reason of any Catch-Up Contributions.

	
  

	
(ii)

	
Matching Allocations, as provided for under Section 3.3, shall be contributed to the Plan only with respect to amounts a Participant elects to be contributed to the Plan as a Before-Tax Contribution other than a Catch-Up Contribution, regardless of whether all or any portion of such Catch-Up Contribution fails to qualify as a catch-up contribution under Code section 414(v) and is recharacterized as a Before-Tax Contribution.

3.2           AFTER-TAX CONTRIBUTIONS

A Participant may make After-Tax Contributions to the Plan and have such contributions made through payroll deductions in multiples of 1% of Compensation to a maximum of 10% of Compensation under the procedures specified by the Benefits Committee. After-Tax Contributions shall be subject to the aggregate limitation set forth in Section 3.1(a) hereof.

3.3           MATCHING ALLOCATIONS; COMPANY CONTRIBUTIONS

	
(a)  

	
Under procedures established by the Benefits Committee, the Employer shall make Matching Allocations to the Matching Account of each Participant who makes Before-Tax Contributions.

 

	
(i)  

	
For Plan Years commencing on or after December 31, 2006 and prior to December 31, 2008, the Employer’s obligation to make Matching Allocations shall be satisfied (in accordance with the provisions of this Section 3.3 and, if applicable Article 11A) by crediting a Participant’s Matching Account

 

  

18

  

with a contribution equal to 50% of the Participant’s Before-Tax Contributions up to 6% of Compensation; provided, however, that such total contribution shall not exceed 3% of the Participant’s Compensation for a Plan Year.  Employer Matching Allocations will be recalculated as soon as practicable following the end of each Plan Year, based on the Before-Tax Contributions that an eligible Participant makes for the Plan Year, and the Participant’s Compensation for such Plan Year.  Each affected Participant shall receive a “true-up” Employer Matching Allocation in an amount which is the difference between the Employer Matching Allocation actually received by a Participant during the applicable Plan Year, and the amount equal to 50% of the Participant’s Before-Tax Contributions, up to 6% of Compensation, for the Plan Year.  Any Catch-Up Contributions made to the Plan pursuant to Section 3.1(g) of the Plan will not be considered in calculating the “true-up” Matching Allocation.  “True-up” Matching Allocations will be treated as being contributed to the Plan as of the date of contribution (but not later than the last day of the Plan Year for which they are made), without adjustment for any earnings and/or losses.

 

	
(ii)  

	
For the Plan Year commencing December 31, 2008, the Employer’s obligation to make Matching Allocations shall be satisfied (in accordance with the provisions of this Section 3.3 and, if applicable Article 11A) by crediting a Participant’s Matching Account with a contribution equal to 50% of the Participant’s Before-Tax Contributions up to 6% of Compensation made to a Participant’s account for the period commencing December 31, 2008 and ending June 30, 2009; provided, however, that such total contribution shall not exceed

 

  

19

  

3% of the Participant’s Compensation for the portion of the Plan Year commencing December 31, 2008 and ending June 30, 2009.  Matching Allocations to the Plan shall be suspended effective as of July 1, 2009 and no Matching Allocations shall be made to the Plan with respect to any Participant Before-Tax Contributions made to the Plan on and after July 1, 2009.  Employer Matching Allocations will be recalculated as soon as practicable following June 30, 2009, based on the Before-Tax Contributions that an eligible Participant makes for the portion of the Plan Year commencing December 31, 2008 and ending June 30, 2009, and the Participant’s Compensation for such portion of the Plan Year (such Compensation being taken into account not to exceed the applicable pro-rata portion of the Code Section 401(a)(17) limit for the Plan Year commencing December 31, 2008).  Each affected Participant shall receive a “true-up” Employer Matching Allocation in an amount which is the difference between the Employer Matching Allocation actually received by a Participant during the portion of the Plan Year commencing December 31, 2008 and ending June 30, 2009, and the amount equal to 50% of the Participant’s Before-Tax Contributions, up to 6% of Compensation, for the portion of the Plan Year commencing December 31, 2008 and ending June 30, 2009.  Any Catch-Up Contributions made to the Plan pursuant to Section 3.1(g) of the Plan will not be considered in calculating the “true-up” Matching Allocation.  “True-up” Matching Allocations will be treated as being contributed to the Plan as of the date of contribution (but not later than the last day of the Plan Year for which they are made), without adjustment for any earnings and/or losses.

 

  

20

  

	
(iii)  

	
For Plan Years commencing on and after December 31, 2009, the Employer’s obligation to make Matching Allocations shall be at the sole discretion of the Board of Directors of Barnes Group Inc.

 

	
(iv)  

	
In no event shall Matching Allocation that are satisfied by Company Contributions be paid to the Trustee (1) before the Participant has elected to make Before-Tax Contributions pursuant to Section 3.1 or is treated as having made a default election under Section 2.1 and (2) before the earlier of the Participant’s performance of services that related to the Compensation that, but for the Participant’s election, would have been paid to the Participant, or, the date the Compensation is made currently available to the Participant.  Notwithstanding anything to the contrary in the immediately preceding sentence, Matching Allocations that are satisfied by Company Contributions may be made prior to the performance of the services related to such contribution in order to accommodate a bona fide administrative consideration to the extent permitted under Code Section 401(m) and the regulations and other guidance issued thereunder. 

 

	
(b)

	
If the Plan has an outstanding ESOP Loan under Article 11A, Matching Allocations shall be satisfied by the following in the priority indicated:  (1) the Value of Shares released from the ESOP Loan Suspense Account by reason of the use of dividends on Shares in the ESOP Loan Suspense Account to repay the ESOP Loan; (2) Shares released from the ESOP Loan Suspense Account (by reason of the use of Before-Tax Contributions to repay the ESOP Loan) having an aggregate value in excess of the amount of such Before-Tax Contributions; (3) the Value of Shares forfeited pursuant to Section 8.4; (4) the Value of Shares released from the ESOP Loan Suspense Account by reason of the use of Company Contributions to

  

21

  

repay the ESOP Loan; and (5) the Value of Shares purchased on the open market with Company Contributions.  Thus, if the Plan has an outstanding ESOP Loan, the Matching Allocations to be satisfied by Company Contributions will be that amount necessary, after giving effect to items (1) through (3) above, to cause the crediting to Participants' Matching Accounts of the aggregate Value set forth in the second sentence of Section 3.3(a) hereof.

3.4           PROFIT SHARING CONTRIBUTIONS

With respect to each Plan Year, the Company shall make a Contribution to the Trust Fund for allocation to the Profit Sharing Accounts as follows:

	
(a)

	
For Bowman U.S., effective January 1, 2005, no allocations shall be made to the Profit Sharing Accounts for any Plan Year.

	
(b)

	
For Participating Divisions except as set forth in paragraph (c) below, for each Participant who will receive an allocation with respect to the Plan Year pursuant to this Section 3.4, an amount equal to three and one-half percent (31⁄2%) of each such Participant’s Compensation, plus, in respect of each such Participating Division, such sum as the Compensation and Management Development Committee of the Board (or such other committee or group as designated by the Board), in its discretion, shall determine based on the performance of such Participating Division for such Plan Year.

	
(c)

	
For the West Chester, Windsor Airmotive (West Chester) and Phoenix Participating Divisions, for the Plan Year beginning

	
  

	
(i)

	
December 31, 2005, an amount equal to not less than one and one-half percent (11⁄2%) nor more than three percent (3%) of the aggregate annual compensation

  

22

  

paid to such Participants who will receive an allocation with respect to the Plan Year beginning December 31, 2005, determined by the Compensation and Management Development Committee of the Board (or such other committee or group as designated by the Board), in its discretion, based on the performance of the respective Participating Division for such Plan Year; and

	
  

	
(ii)

	
December 31, 2006, an amount equal to not less than two and one-half percent (21⁄2%) nor more than five percent (5%) of the Compensation paid to each Participant who will receive an allocation with respect to the Plan Year beginning December 31, 2006, determined by the Compensation and Management Development Committee of the Board (or such other committee or group as designated by the Board), in its discretion, based on the performance of the respective Participating Division for such Plan Year; and

	
  

	
(iii)

	
December 31, 2007 and thereafter, as set forth in Section 3.4(b) of the Plan; provided, however, that for the Plan Years beginning December 31, 2005 and December 31, 2006, no amount will be payable to any of the West Chester, Windsor Airmotive (West Chester) or Phoenix Participating Divisions if the applicable Participating Division does not achieve a profit level above the level set in their profit plan for the applicable Plan Year by at least an amount equal to the amount of the profit sharing contribution payable to such Participating Division under paragraph (i) or (ii) above for the respective Plan Year.

	
(d)

	
The aggregate amount of the contributions made by an Employer pursuant to this Section 3.4 in respect of the Plan Year to which such contributions relate shall be allocated among the Participating Division Employees of such Employer who are employed on the

  

23

  

last day of such Plan Year, in the manner herein provided; provided, however, that a Participating Division Employee who terminates employment during the Plan Year by reason of retirement on or after attainment of age 55, Disability, or death shall receive an allocation for such Plan Year without regard to the requirements of the preceding clause.

	
(e)

	
The contribution made pursuant to this Section 3.4 in respect of divisions of the Barnes Aerospace Group shall be allocated among eligible Participating Division Employees employed by the division in proportion to the Compensation for the Plan Year of each such eligible Participant. 

	
(f)

	
Any forfeiture arising under Section 8.4 in any Plan Year shall be reallocated in the manner specified in this Section 3.4 as though it were an Employer contribution in respect of such Plan Year.

	
(g)

	
Each Employer shall on the last day of each Plan Year certify to the Benefits Committee (i) a list of the Employees of such Employer who are entitled to share in the contributions made pursuant to this Section 3.4 for the Plan Year and (ii) the respective Compensation of such Employees for service with such Employer for the portion of such Plan Year during which they are Participating Division Employees; and the Benefits Committee shall, after the receipt of this certification and the Employers' contributions, credit to each Participating Divisions Employee's Profit Sharing Account the amount to be allocated pursuant to this Section 3.4

3.5           MAXIMUM ANNUAL ADDITIONS

	
(a)

	
The amount of annual additions which may be credited to a Participant's Accounts for any limitation year may not exceed the lesser of:

  

24

  

	
  

	
(i)

	
$40,000 (as adjusted pursuant to Code section 415(d)) reduced by the amount, if any, allocated to all individual medical accounts (as defined in Code section 415(l)(2)) which are part of a defined benefit plan and further reduced by the amount, if any, contributed to a separate account for post-retirement medical benefits of key employees (as defined in Code section 419A(d)(3)) under a welfare benefit fund (as defined in Code section 419(e)) for the limitation year; or 

	
  

	
(ii)

	
100% of the Participant’s compensation as defined in Section 3.9(a)(iv).

	
(iii)            

	
If no more than one-third of all Before-Tax and After-Tax Contributions and Matching Allocations for the limitation year are allocated to the Accounts of Highly Compensated Employees, for purposes of determining whether annual additions made to a Participant's Before-Tax, Matching and After-Tax Accounts would cause the above limitations to be exceeded, the limitations set forth in 3.5(a)(i) shall be applied to the annual addition described in Section 3.5(b) below, after excluding from such annual addition an amount equal to (x) forfeitures of Company Stock which were acquired with the proceeds of a loan described in Code section 404(a)(9)(A), and (y) Employer contributions which are deductible under Code section 404(a)(9)(B) and charged against the Participant's Account.  The Benefits Committee may adjust in a nondis­criminatory manner the allocation of Before-Tax and After-Tax Contributions and Matching Allocations to prevent the allocation of more than one third of the Before-Tax and After-Tax Contributions and Matching

  

25

  

Allocations for the limitation year to the Accounts of Highly Compensated Employees.

	
  

	
(iv)

	
The compensation limit referred to in (ii) shall not apply to any contribution for medical benefits after separation from service (within the meaning of Code sections 401(h) or 419(A)(F)(2)) which is otherwise treated as an annual addition.

	
(b)  

	
Limitation Year.  Limitation year shall mean the Plan Year.

	
(c)

	
Annual Additions.  Annual additions shall mean the sum of the following amounts credited to a Participant's Accounts for the limitation year under all defined contribution plans maintained by the Company:

	
  

	
(i)

	
Company contributions, including Before-Tax Contributions;

	
  

	
(ii)

	
Employee contributions, including After-Tax Contributions;

	
  

	
(iii)

	
Forfeitures used to reduce Company Contributions or allocated to Participants’ Accounts; and

	
  

	
(iv)

	
amounts described in Code sections 415(1)(2) and 419(A)(d)(2).

  

26

  

For Limitation Years beginning before July 1, 2007, if, due to a reasonable error in estimating a Participant's annual compensation, or due to the allocation of forfeitures, an excess annual addition exists, such excess will be eliminated as follows:

	
(1)  

	
After-Tax Contributions, plus any income allocable thereto, will be returned to the Participant to the extent necessary.

	
(2)  

	
Before-Tax Contributions, plus any income allocable thereto, will be returned to the Participant to the extent necessary.

	
(3)  

	
Matching Allocations attributable thereto for such limitation year, plus any income and minus any loss allocable thereto, will be placed in a suspense account and allocated in succeeding Plan Years in accordance with procedures adopted by the Benefits Committee.

	
(4)  

	
Profit Sharing Allocations attributable thereto for such limitation year, plus any income and minus any loss allocable thereto, will be placed in a suspense account and allocated in succeeding Plan Years in accordance with procedures adopted by the Benefits Committee.

	
(d)

	
Effective for Limitation Years beginning on or after July 1, 2007, in no event shall a Participant be credited with a contribution or forfeiture for any Year in excess of that allowed by Code section 415, as adjusted pursuant to Code section 415(d).  The limitations of Code section 415 are incorporated by reference into this Plan.  In the case of any Participant who has been credited with annual additions for the Limitation Year under any

  

27

  

other defined contribution plan maintained by an Employer or Affiliated Employer, the limitations of Code section 415 shall be applied as if all such annual additions were made to a single plan.  Any reduction in annual additions that is necessary to meet such limitation shall first be made under this Plan by reducing the contributions otherwise allocable to the Account of the affected Participant in the following order:  (i) Profit Sharing Contributions; (ii) Matching Allocations; (iii) After-Tax Contributions; and (iv) Before-Tax Contributions.

3.6           MISTAKEN CONTRIBUTIONS

The Employer may recover without interest the amount of its contributions to the Plan made on account of a mistake in fact, reduced by any investment loss attributable to those contributions, if recovery is made within one year after the date of those contributions.

3.7           CHANGE OF CONTRIBUTION ELECTION

	
(a)  

	
A Participant may suspend his contributions to be effective on the first day of the calendar month which is at least 30 days (or some lesser period of time designated by the Benefits Committee) after the date he files with the Employer a form prescribed by the Benefits Committee for such purpose.

	
(b)  

	
A Participant may increase or decrease the amount of his contributions, or re-commence contributions following a suspension pursuant to Section 3.7, subject to the maximum contribution permitted under Section 3.1 or Section 3.2, as applicable, to be effective on the first day of the calendar month which is at least 30 days (or some lesser period of time

  

28

  

designated by the Benefits Committee) after he files a form prescribed by the Benefits Committee for such purpose.

	
3.8  

	
LIMITATIONS AFFECTING HIGHLY COMPENSATED EMPLOYEES

Notwithstanding any other provision of the Plan, the Actual Deferral Percentage and the Actual Contribution Percentage (as defined herein) for Participants who are Highly Compensated Employees must satisfy the tests described in Section 3.9.

	
3.9  

	
NONDISCRIMINATION TESTS

	
(a)  

	
For purposes of this section, the following terms shall have the meaning indicated below:

	
(i)  

	
“Actual Deferral Percentage” means the average (expressed as a percentage) of the deferral percentages of Eligible Employees in a group.  An Eligible Employee’s deferral percentage is equal to the ratio (expressed as a percentage) of the Employee’s Before-Tax Contributions (including excess Before-Tax Contributions returned to a Highly Compensated Employee pursuant to Section 3.1, but excluding Before-Tax Contributions which exceeded the limit in Code section 415(c) and which have been or will be returned to any Employee pursuant to Section 3.5(a)) contributed to the Trust Fund for the Plan Year to the Eligible Employee’s Compensation for the Plan Year.  The individual ratios shall be calculated to the nearest one-hundredth of one percent (.01%).

  

29

  

	
(ii)  

	
“Actual Contribution Percentage” means the average (expressed as a percentage) of the contribution percentages of Eligible Employees in a group.  An Eligible Employee’s contribution percentage is equal to the ratio (expressed as a percentage) of the Employee’s After-Tax Contributions, if any, Matching Allocations and Before-Tax Contributions not used in the final Actual Deferral Percentage (excluding Matching allocations which exceeded the limit in Code section 415(c) contributed to the Trust Fund for the Plan Year to the Eligible Employee’s Compensation for the Plan Year.  The individual ratios shall be calculated to the nearest one-hundredth of one percent (.01%).

	
(iii)  

	
“Eligible Employee” means any Employee of the Employer who, during the Plan Year, is eligible to make Before-Tax Contributions in accordance with the provisions of Section 2.1, or is eligible to receive Matching Allocations in accordance with Section 3.3.  An individual shall be treated as an Eligible Employee for a Plan Year if he or she so qualifies for any part of the Plan Year, and whether or not his or her right to make Before-Tax Contributions has been exercised or suspended under Section 7.2(c). The Actual Deferral Percentage and Actual Contribution Percentage defined above may be calculated by dividing the Eligible Employees into two separate groups–one for Eligible Employees who are under age 21 and/or who have less than a year of service and one for the remaining Eligible Employees. Eligible Employees who are Nonhighly Compensated Employees, who are under age 21 and/or who have less than a year of service may be excluded from

  

30

  

the calculations and from the ADP and ACP tests provided the requirements of Code section 401(k)(3)(F) are satisfied.

	
(iv)  

	
“Compensation” means the Employee’s 415 Compensation (as defined below), but not in excess of the limit under Code section 401(a)(17), or any other definition of compensation which satisfies Code section 414(s) for testing purposes.  The term “415 Compensation” means wages, salaries and fees for professional services and other amounts received from the Employer and all Affiliated Employers during the Limitation Year (without regard to whether or not an amount is paid in cash) for personal services actually  rendered in the course of employment with the Employer, to the extent such amounts are includible in gross income, including, but not limited to, overtime pay, bonuses, commissions to paid salesmen, compensation for services on the basis of a percentage of profits, commissions on insurance premiums, fringe benefits, reimbursements, expense allowances, and amounts which are contributed by the Employer pursuant to a salary reduction agreement and which are not includible in the gross income of the Participant under Code sections 125, 402(e)(3), 402(h)(1)(B), 403(b), 457(b) or Section 132(f)(4), and Employee contributions described in Code section 414(h)(2) that are treated as Employer contributions, and excluding the following:

	
(A)  

	
Amounts contributed by the employer or Affiliated Employer on behalf of the Employee to any other plan of deferred compensation and which are

  

31

  

not includible in the Employee’s gross income for the taxable year in which contributed or any distributions from a plan of deferred compensation;

	
(B)  

	
Amounts realized from the exercise of a nonqualified stock option, or when restricted stock (or property) held by the Employee either becomes freely transferable or is no longer subject to a substantial risk of forfeiture;

	
(C)  

	
Amounts realized with respect to the sale, exchange, or other disposition of stock acquired under a qualified stock option; and

	
(D)  

	
Other amounts which receive special tax benefits, such as premiums for group term life insurance (but only to the extent that the premiums are not includible in the gross income of the Employee).

Notwithstanding the foregoing, in determining the amount of Compensation to be taken into account for purposes of this Section, the Benefits Committee may limit the period used to determine an Employee’s Compensation for the Plan Year to the portion of the Plan Year in which the Employee was an Eligible Employee (as defined in subparagraph (iii) above), provided that this limit is applied uniformly and separately to all Eligible Employees with respect to subparagraphs (i) and (ii) above for such Plan Year.

	
(v)

	
“Testing Method” means either the “prior year method” or the “current year method.”  Under the prior year method, the Actual Deferral Percentage and Actual

  

32

  

Contribution Percentage for the group of Eligible Employees who are Nonhighly Compensated Employees is determined based on data from the preceding plan year. Under the current year method, the Actual Deferral Percentage and Actual Contribution Percentage for the group of Eligible Employees who are Nonhighly Compensated Employees is determined based on data from the current plan year.  Under both methods, the Actual Deferral Percentage and Actual Contribution Percentage for the group of Eligible Employees who are Highly Compensated Employees is determined based on data from the current plan year. 

	
(b)  

	
If more than one plan providing for a cash or deferred arrangement, or for matching contributions, or employee contributions (within the meaning of Sections 401(k) and 401(m) of the Code) is maintained by the Employer or an Affiliated Employer, then the individual ratios of any Highly Compensated Employee who participates in more than one such plan or arrangement shall, for purposes of determining the individual’s Actual Deferral Percentage and Actual Contribution Percentage, be determined as if all such arrangements were a single plan or arrangement.  If a Highly Compensated Employee participates in two or more cash or deferred arrangements that have different plan years, all cash or deferred arrangements ending with or within the same calendar year shall be treated as a single arrangement.  Notwithstanding the foregoing, plans that are subject to mandatory disaggregation pursuant to regulations under Code section 401(k) shall not be aggregated for purposes of this paragraph but will be treated as separate plans.

	
(c)  

	
In the event that this Plan satisfies the requirements of Code sections 401(a)(4) and 410(b) only if aggregated with one or more other plans, and all such plans have the same

  

33

  

Plan Year, then this Section shall be applied by determining the Actual Deferral Percentage and Actual Contribution Percentage of Eligible Employees as if all such plans were a single plan.  Such plans may be aggregated only if they use a consistent Testing Method.

	
(d)  

	
In accordance with the nondiscrimination requirements of Code section 401(k), the Benefits Committee may establish a Compensation Deferral Limit with respect to Before-Tax Contributions credited to a participant’s Total Account during a Plan Year and may adjust such deferral limit (in accordance with paragraph (f)(i) below) from time to time during the Plan Year in order to satisfy one of the following limits which are referred to as the ADP test:

	
  

	
(i)

	
The Actual Deferral Percentage of the group of Eligible Employees who are Highly Compensated Employees for the Plan Year shall not exceed the Actual Deferral percentage of the group of Eligible Employees who are Nonhighly Compensated Employees for the Plan Year multiplied by 1.25.

	
  

	
(ii)

	
The Actual Deferral Percentage of the group of Eligible Employees who are Highly Compensated Employees for the Plan Year shall not exceed the Actual Deferral Percentage of the group of Eligible Employees who are Nonhighly Compensated Employees for the Plan Year multiplied by two, provided that such Actual Deferral percentage for Highly Compensated Employees is not more than two percentage points higher than such Actual Deferral Percentage for Nonhighly Compensated Employees.

  

34

  

	
(e)  

	
In accordance with the nondiscrimination requirements of Code section 401(m), the Benefits Committee may establish a Contribution Percentage Limit with respect to After-Tax Contributions, if any, credited to a Participant’s account during a Plan Year and may adjust such percentage limit (in accordance) with paragraph (f)(i) below from time to time during the Plan Year in order to satisfy one of the following limits which are referred to as the ACP test:

	
(i)  

	
The Actual Contribution Percentage of the group of Eligible Employees who are Highly Compensated Employees for the Plan Year shall not exceed the Actual Contribution Percentage of the group of Eligible Employees who are Nonhighly Compensated Employees for the Plan Year multiplied by 1.25.

	
(ii)  

	
The Actual Contribution Percentage of the group of Eligible Employees who are Highly Compensated Employees for the Plan Year shall not exceed the Actual Contribution Percentage of the group of Eligible Employees who are Nonhighly Compensated Employees for the Plan Year multiplied by two, provided that the Actual Contribution Percentage for Highly Compensated Employees is not more than two percentage points higher than such Actual Contribution Percentage for Nonhighly Compensated Employees.

	
(f)  

	
The Benefits Committee may take the following actions to assure compliance with the nondiscrimination limitations of Code section 401(k) and/or 401(m).

  

35

  

	
(i)  

	
If, during the Plan Year, the average percentages described in paragraphs (d) and/or (e) above applicable to the group of Eligible Employees who are Highly Compensated Employees are expected to exceed the maximum average percentage necessary to comply with the limits described in said paragraphs, the Benefits Committee may direct that the Actual Deferral Percentage and/or the Actual Contribution Percentage, as the case may be, for one or more members of such group of Highly Compensated Employees be reduced prospectively to the extent necessary to comply with the applicable limit by limiting the percentage of Before-Tax Contributions and/or After-tax Contributions of such Employees.

	
(ii)  

	
If, after the Plan Year ends, the average percentages describe in paragraphs (d) and/or (e) above applicable to the group of Eligible Employees who are Highly Compensated Employees exceed the maximum average percentage necessary to comply with the limits described in said paragraphs, the Benefits Committee may direct that the Before-Tax Contribution and/or the After-Tax Contribution and Matching Allocation, as the case may be, for Highly Compensated Employees be reduced to the extent necessary to comply with the applicable limit.  Such reduction shall follow the procedures described in paragraph (g) below.

	
(g)  

	
The total amount of Before-Tax Contribution to be refunded is calculated by first successively reducing the Actual Deferral Percentage of one or more members of such group of Highly Compensated Employees by reducing the Actual Deferral Percentage of the Highly Compensated Employee with the highest Actual Deferral Percentage until it equals

  

36

  

the Actual Deferral Percentage of the Highly Compensated Employee with the second highest Actual Deferral Percentage, then reducing their Actual Deferral Percentages until they equal the Actual Deferral Percentage of the Highly Compensated Employee with the third highest Actual Deferral Percentage, and so on until the average percentage for the group does not exceed the applicable limit.  Second, the excess of each Employee’s Actual Deferral Percentage over such reduced Actual Deferral Percentage multiplied by the Employee’s Compensation used in the test is calculated as a hypothetical refund.  Third, such excess hypothetical refunds are aggregated to determine the total Before-Tax Contributions to be refunded.  The ADP test described in paragraph (d) above shall use the data that reflects this hypothetical refund.

The actual Before-Tax Contribution refunds are then calculated by successively reducing the amount of the Before-Tax Contribution of one or more members of such group of Highly Compensated Employees beginning with the Highly Compensated Employee(s) with the highest dollar amounts of Before-Tax Contribution using the method described in the preceding paragraph until the total of such actual refunds equals the total amount of Before-Tax Contribution to be refunded.  The ADP test described in paragraph (d) above shall not use the data that reflects this actual refund.

The amount by which the Before-Tax Contribution exceeded the dollar limit in Section 3.1 for a Highly Compensated Employee as described in (a)(i) above shall also then be refunded and such refund shall be made in accordance with Section 3.1.

  

37

  

The total amount of After-Tax Contribution to be refunded and/or Matching allocation to be refunded and/or forfeited is calculated by first successively reducing the Actual Contribution percentage of one or more members of such group of Highly Compensated Employees beginning with the Highly Compensated Employee with the highest Actual Contribution Percentage in the same manner as the ADP test until the average percentage for the group does not exceed the applicable limit.  Second, the excess of each Employee’s Actual Contribution percentage over such reduced Actual Contribution Percentage multiplied by the Employee’s Compensation used in the test is calculated as a hypothetical refund.  Third, such excess hypothetical refunds are aggregated to determine the total After-Tax Contributions and Matching Allocations to be refunded and/or forfeited.  The ACP test in paragraph (e) above shall use the data that reflects this hypothetical refund or forfeiture.

The actual After-Tax Contribution refunds and the actual Matching Allocation refunds and/or forfeitures are then calculated by successively reducing the After-Tax Contribution and then the Matching Allocation of one or more members of such group of Highly Compensated Employees beginning with the Highly Compensated Employee with the highest dollar amount of combined After-Tax Contribution and Matching Allocation using the method for refunding Before-Tax Contributions described above until the total of such deemed refunds equals the total amount of After-Tax Contribution and Matching Allocation to be refunded and/or forfeited.  Matching Allocations shall be refunded if vested and the ACP test failed, or forfeited if the ACP test passed, or forfeited if the ACP test failed and such contributions are nonvested.  If the actual refund of Before-Tax Contributions and/or After-Tax Contributions for any Employee includes an amount of Before-Tax Contributions

  

38

  

and/or After-Tax Contributions that were matched, the  Matching Allocation attributable thereto shall be forfeited.  The ACP test in paragraph (e) above shall not use the data that reflects this actual refund or forfeiture.

	
(h)  

	
Contributions that are refunded or forfeited under paragraph (g) above or under Section 3.1(d) shall be adjusted for allocable gains or losses for the Plan Year with respect to which the contributions were made (including income or loss for the period between the end of the Plan Year and the date of distribution).  The amount of the allocable gain or loss is the product of (i) multiplied by (ii), where (i) is a ratio, the numerator of which is the Plan Year-to-date gain or loss on the money type being refunded or forfeited and the denominator of such money type at the beginning of the Plan Year, plus contributions of that money type credited for such Plan Year, and (ii) is the amount of the refund or forfeiture of that money type.  Income allocable to the excess amounts for the period between the end of the Plan Year and the date of distribution shall be determined under the method otherwise used for allocating income to Participants’ Accounts and shall be determined on a date that is no more than seven (7) days before the date of distribution.  In all events, the income attributable to such excess amounts will be determined in accordance with regulations issued under Code sections 401(k), 401(m) and 402(g), as applicable. 

Money type for purposes of this paragraph means Before-Tax Contributions, After-Tax Contributions and Matching Allocations, whichever applies.  A refund of Before-Tax Contributions in excess of the limit in Section 3.1 is referred to as an excess deferral.  A refund of Before-Tax Contributions due to a failure of the ADP test is referred to as an

  

39

  

excess contribution, a refund of After-Tax Contributions and/or Matching Allocations due to a failure of the ACP test is referred to as an excess aggregate contribution, and a forfeiture of Matching Allocations is referred to as a forfeiture.

	
(i)  

	
Refunds or forfeitures needed to satisfy the above tests shall be made before the end of the Plan Year following the Determination Year.  Refunds needed to satisfy the limit in Section 3.1 shall be made on or before April 15 following the end of the calendar year.  If the Employee has made Before-Tax Contributions in excess of such limit to two or more plans of unrelated employers, the Employee must notify the Benefits Committee on or before March 1 following the end of the calendar year of the amount to be refunded from this Plan in order to comply with such limit for the year.

	
(j)   

	
Alternatively, within twelve (12) months after the end of the Plan Year, the Employer, at its discretion may make a special qualified non-elective contribution on behalf of Nonhighly Compensated Participants in an amount sufficient to satisfy the ADP and/or ACP tests in lieu of refunds or forfeitures.  Such contributions (i) may be made as a uniform percentage of Compensation or as a uniform dollar amount contributed on a per capita basis, (ii) may be made for all or certain of those Participants who are not Highly Compensated Employees, and (iii) may be made at any time prior to the end of the 12-month period immediately following the Plan Year to which such contributions relate.  Qualified nonelective contributions shall be fully vested and nonforfeitable at all times.  Qualified nonelective contributions shall not be taken into account in conducting the nondiscrimination tests described in Sections 3.9(d) and (e) for any Plan Year to the

  

40

  

extent such contributions exceed the production of the Participant’s Compensation and the greater of (i) five percent or (ii) two times the Plan’s “Representative Contribution Rate.”  The Plan’s “Representative Contribution Rate” is the lowest “Contribution Rate” among a group of Participants who are not Highly Compensated Employees, which group is half of all Participants who are not Highly Compensated Employees, or the lowest Contribution Rate among all Participants who are not Highly Compensated Employees who are employed on the last day of the year, if greater.  The Plan’s “Contribution Rate” is the sum of all qualified nonelective contributions taken into account for a Participant, divided by the Participant’s Compensation.  Any qualified nonelective contributions taken into account for purposes of Section 3.9(d) shall not be taken into account for purposes of Section 3.9 (e), and any qualified nonelective contributions taken into account under Section 3.9(a), shall not be taken into account under Section 3.9(d).

	
(k)   

	
The Benefits Committee shall maintain sufficient records to demonstrate that the Plan satisfies the nondiscrimination tests described above.  Changes in the Code or regulations affecting the ADP test and/or the ACP test or the corrective methods may be used notwithstanding a conflict with the above provisions.

3.10           ROLLOVER CONTRIBUTIONS

A Participant may make a Rollover Contribution to the Plan upon demonstration to the Benefits Committee (as determined by the Benefits Committee in its discretion based on such documentation as it may deem necessary and desirable) that the contribution is eligible for transfer to the Plan pursuant to the rollover provisions of the Code, including without limitation contributions from an

  

41

  

individual retirement account described in Code section 408(a), an individual retirement annuity described in Code section 408(b), an annuity plan described in Code section 403(a), a qualified trust described in Code section 401(a), an eligible deferred compensation plan described in Code section 402(c)(8)(B)(v), and an annuity contract described in Code section 403(b). Any Rollover Contributions made by a Participant shall be allocated to the Participant’s Rollover Account. 

  

42

  

ARTICLE 4 - COMPANY STOCK FUND

4.1           CONTRIBUTIONS

For Plan Years prior to January 1, 2008, all Employer Matching Allocations were invested in the Company Stock Fund.  Beginning January 1, 2008, Employer Matching Allocations are made in cash.  Money contributed to the Plan may, at the election of the Participant, be invested in the Company Stock Fund or in any other investment fund under the Plan pursuant to Article 5 of the Plan; provided, however, that amounts contributed to the Company Stock Fund may also be invested in short term obligations of the United States Government or other short term investments selected by the Trustee pending investment in Company Stock.  Beginning January 1, 20008, Participants may at any time following the investment of any portion of their Accounts in the Company Stock Fund reallocate the investment of all or any portion of their Accounts invested in the Company Stock Fund pursuant to Article 5 of the Plan.

	
4.2  

	
VALUE

For purposes of valuing a Participant's Accounts, the value of a share held in the Company Stock Fund on each Valuation Date (and other determination dates) is based upon the closing sales price of the Common Stock on the date of determination on the New York Stock Exchange Composite Index (or on the principal market on which the Common Stock is traded if the Common Stock is not listed on that market on such date) or, if the Common Stock is not traded on such date, the closing sales price of the Common Stock on the next preceding trading day.

  

43

  

ARTICLE 4A - MERGER OF PAYSOP

4A.1           MERGER AND TRANSFER

Effective as of December 31, 1990, the PAYSOP was merged into the Plan, and all assets and liabilities of the PAYSOP were transferred to the Plan.

4A.2           SEPARATE ACCOUNTS

The Benefits Committee established a separate account, the PAYSOP Account, for each account transferred from the PAYSOP, and each such PAYSOP Account initially shall be invested in the Company Stock Fund.

4A.3           RIGHTS

Except as otherwise provided in the Plan, the rights of each Participant or the beneficiary thereof with respect to his PAYSOP Account shall be determined under the terms of the PAYSOP as in effect on December 31, 1990, attached hereto as Exhibit A.

  

44

  

ARTICLE 5 - INVESTMENT OF CONTRIBUTIONS

5.1           DIRECTED INVESTMENT ACCOUNT

	
(a)

	
Participants may, subject to a procedure established by the Benefits Committee and applied in a uniform nondiscriminatory manner, direct the Trustee as to the investment of amounts in their Accounts under the Plan.

In accordance with a Participant’s investment elections, the Trustee shall invest applicable Accounts in specific assets, specific funds or other investments permitted under the Plan.  That portion of the interest of any Participant so directing will thereupon be considered a Participant’s Directed Account. 

	
(b)

	
As of each Valuation Date, all Participant Directed Accounts shall be charged or credited with the net earnings, gains, losses and expenses as well as any appreciation or depreciation in the market value using publicly listed fair market values when available or appropriate.

	
(c)

	
The procedure established by the Benefits Committee shall provide an explanation of the circumstances under which Participants and their Beneficiaries may give investment instructions, including, but need not be limited to, the following:

	
  

	
(i)

	
the conveyance of instructions by the Participants and their Beneficiaries to invest Participant Directed Accounts in directed investments;

  

45

  

	
  

	
(ii)

	
the name, address and phone number of the fiduciary (and, if applicable, the person or persons designated by the fiduciary to act on its behalf) responsible for providing information to the Participant or a beneficiary upon request relating to the investments in directed investments;

	
  

	
(iii)

	
applicable restrictions on transfers to and from any specific investment identified by name by a fiduciary as an available investment under the Plan which may be acquired or disposed of by the Trustee pursuant to the investment direction by a Participant.

	
  

	
(iv)

	
any restrictions on the exercise of voting, tender and similar rights related to a directed investment by the Participants or their Beneficiaries;

	
  

	
(v)

	
a description of any transaction fees and expenses which affect the balances in Participant Directed Accounts in connection with the purchase or sale of directed investments; and

	
  

	
(vi)

	
general procedures for the dissemination of investment and other information relating to the investment alternatives available under the Plan as deemed necessary or appropriate, including but not limited to a description of the following:

	
  

	
(A)

	
specific information regarding the investment vehicles available under the Plan including a general description of the investment objectives and risk

  

46

  

and return characteristics and information regarding the type and diversification of assets in the portfolio of each;

	
  

	
(B)

	
any designated entity that (a) has the power to manage, acquire, or dispose of Plan assets and (b) acknowledges fiduciary responsibility to the Plan in writing.  Such entity must be a person, firm, or corporation registered as an investment adviser under the Investment Advisers Act of 1940, a bank, or an insurance company; and

	
  

	
(C)

	
a description of the additional information which may be obtained upon request from the fiduciary designated to provide such information.

	
(d)

	
Any information regarding investments available under the Plan may be provided to the Participant in one or more written documents.

	
(e)

	
The Benefits Committee may, at its discretion, establish such instructions, guidelines or policies as it deems necessary or appropriate to ensure proper administration of the Plan, and may interpret the same accordingly.

  

47

  

5.2           INVESTMENT ELECTION

The investment election described in Section 5.1 shall be made in 5% increments, or such other increments as determined by the Benefits Committee on such form or through such electronic means as may be prescribed by the Benefits Committee.

5.3           RESPONSIBILITY FOR INVESTMENTS

Each Participant is solely responsible for the selection of his investment options with respect to his Accounts.  The Plan is intended to comply with Section 404(c) of ERISA and applicable regulations thereunder with respect to the investment of Participant Accounts.  The Trustees, the Benefits Committee, the Employer, and the officers, supervisors and other employees of the officers, supervisors and other Employers are not empowered to advise a Participant as to the manner in which such amounts shall be invested.  The fact that an investment fund is available to Participants for investment under the Plan shall not be construed as a recommendation for investment in that fund.

5.4           CHANGES IN INVESTMENTS

Subject to rules and procedures established by the Benefits Committee, a Participant may change his investment election under Section 5.2 and make transfers between Investment Funds.

  

48

  

5.5           ACCOUNTS

The Benefits Committee shall establish and maintain Accounts which shall account for the amounts contributed with respect to each Participant and for the investment and disbursement thereof.  At least once each year, each participant shall be furnished with a statement setting forth the Value of his Accounts and the vested portion thereof.

5.6           VOTING RIGHTS

Except as otherwise expressly delegated by the Trustee in writing, the Trustee shall have the sole and exclusive right to vote any securities held in the Trust other than Company Stock for which the Participants shall have the right to direct the voting of shares allocated to their Accounts. 

  

49

  

ARTICLE 6 - VESTED PORTION OF ACCOUNTS

	
6.1

	
BEFORE-TAX, AFTER-TAX ACCOUNTS, ROLLOVER ACCOUNTS, AND PAYSOP ACCOUNTS

A Participant shall at all times be 100% vested in, and have a nonforfeitable right to, his Before-Tax Account, After-Tax Account, Rollover Account and PAYSOP Account.

6.2           MATCHING AND PROFIT SHARING ACCOUNTS

	
(a)  

	
A Participant shall be vested in, and have a nonforfeitable right to, his Matching Account in accordance with the following schedule:

	
Years of Vesting Service

	
Vested Percentage

	  	  
	
Less than 2 years

	
0%

	
2 or more years

	
100%

	
(b)

	
Notwithstanding the foregoing, a Participant shall be 100% vested in, and have a nonforfeitable right to, his Matching Account upon attaining age 55 or upon Disability or death, in each case while actively employed by an Employer.

	
(c)

	
Notwithstanding anything to the contrary herein, a Participant shall at all times be 100% vested in the portion of his Accounts that are attributable to Matching Contributions that were made to the Plan with respect to such Participant prior to May 1, 1988 and which were

  

50

  

transferred to the Company Stock Fund by the Participant pursuant to the irrevocable election described in Section 4.2 of the Plan as in effect on May 30, 2003.

	
(d)

	
Notwithstanding anything to the contrary herein, a Participant who was employed by the Pioneer Division of Barnes Group Inc. on December 31, 1992 shall at all times be 100% vested in his Matching Account.

	
(e)

	
For purposes of vesting, service with Curtis Industries, Inc. shall be recognized from the date of a Participant’s employment with Curtis Industries, Inc.  Amounts in a former Curtis Industries, Inc. 401(k) Retirement Savings Plan participant’s Merged Asset Account which are attributable to employer matching contributions under the Curtis Industries, Inc. 401(k) Retirement Savings Plan will vest in accordance with the above-referenced vesting schedule.  Notwithstanding the foregoing, a Participant who on March 31, 2001, was an active participant in the Curtis Industries, Inc. 401(k) Retirement Savings Plan with at least three years of service as of such date shall, if his termination of employment occurs on or after April 1, 2001 receive credit for a Year of Service for each Plan Year during which he completes at least 1,000 hours of service.

	
(f)

	
The vested percentage of a former participant in the Curtis Industries, Inc. 401(k) Retirement Savings Plan who terminated employment prior to April 1, 2001 shall be determined according to the following vesting schedule:

  

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Years of Vesting Service

	
Vested Percentage

	  	  
	
Less than 5 years

	
0%

	
5 or more years

	
100%

	
(g)

	
A  Participant whose interest in the Spectrum Plastics Molding Resources, Inc. 401(k) Profit Sharing Plan was transferred to this Plan shall be fully vested in his Profit Sharing Account.

	
(h)

	
Except as provided in the Supplements and (g) above, a Participant shall be vested in, and have a nonforfeitable right to, his Profit Sharing Account in accordance with the following schedule:

	
  

	
(1)

	
For Employees of Participating Divisions other than Bowman U.S., with at least one hour of service on or after December 31, 2006:

	
Period of Service

	
Vested and Nonforfeitable

Percentage

	  	  
	
Less than 1 year

	
0%

	
1 but less than 2 years

	
20%

	
2 but less than 3 years

	
40%

	
3 but less than 4 years

	
60%

	
4 but less than 5 years

	
80%

	
5 or more years

	
100%

  

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(2)

	
For Employees of Bowman U.S.:

	
Period of Service

	
Vested and Nonforfeitable

Percentage

	  	  
	
Less than 5 years

	
0%

	
5 or more years

	
100%

Notwithstanding the foregoing, a Participant shall be 100% vested in, and have a nonforfeitable right to, his Profit Sharing Account upon attaining age 65 or upon Disability or death, in each case while actively employed by an Employer.

6.3           VESTING SERVICE

	
(a)

	
Vesting Service shall commence on the first day of the month during which an Employee’s date of employment occurs and shall end on the date on the last day of the month during which such Employee severs from service.  The date an Employee severs from service is the earliest of:

	
  

	
(i)

	
the date the Employee quits, is discharged, retires or dies; or

	
  

	
(ii)

	
the first anniversary of the date the Employee is first absent from service because of a leave of absence authorized by the Employer, provided the Employee fails to return to work by the second anniversary of such date; or

  

53

  

	
  

	
(iii)

	
the first anniversary of the date the Employee is absent from service for any other reason (e.g., sickness, vacation, layoff, etc.), provided that the Employee fails to perform an hour of service during the twelve months prior to such first anniversary date.

Notwithstanding the foregoing, there shall be no severance from service, and absence from employment shall be counted as Vesting Service in the case of employment with an Affiliated Employer, or in the case of military leave in accordance with Article 15.  The Employer's leave policy shall be applied in a uniform and nondiscriminatory manner to all Employees under similar circumstances.

	
(b)

	
For purposes of computing Vesting Service, the following rules apply in cases of a termination of employment followed by a return to service:

	
  

	
(i)

	
If an Employee severs from service as a result of quit, discharge or retirement and then returns to service within twelve months, the period of severance is included.

	
  

	
(ii)

	
If an Employee is absent from service for any reason other than quit, discharge or retirement and during the absence a quit, discharge or retirement occurs, and the Employee subsequently returns to service within twelve months of his original absence, the period between the quit, discharge or retirement and the return to service is included in the Employee's Vesting Service.

  

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(iii)

	
If an Employee severs from service, and fails to perform any hours of service during the twelve months following the severance from service date, then the Employee shall be deemed to have a one-year Break in Service; provided, however, that if an employee severs from service (i) by reason of the pregnancy of the Employee, (ii) by reason of the birth of a child of the Employee, (iii) by reason of the placement of a child with the Employee in connection with the adoption of such child by the Employee, or (iv) for purposes of caring for such child for a period beginning immediately following such birth or placement, and provides satisfactory evidence to the plan administrator that the severance was for one of the reasons specified above, the Employee shall have a one-year Break in Service only if the Employee fails to perform an hour of service during the sixteen-month period following the severance of service.  If an Employee having such a Break in Service is later re-employed by the Employer, Vesting Service earned prior to his most recent severance from service date shall be counted along with any Vesting Service earned after the Employee's reemployment date if:

	
  

	
(A)

	
the period of Vesting service prior to his most recent severance from service date, whether or not continuous, exceeds the latest period of severance during which he was not employed by the Employer, or

	
  

	
(B)

	
he is re-employed prior to five (5) consecutive one (1) year Breaks in Service.

  

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(c)  

	
For purposes of computing Vesting Service, service with any entity acquired by the Employer shall be considered to be service with the Employer.

	
(d)  

	
Prior to October 1, 2000 Vesting Service shall be computed in accordance with the terms of the Plan as then constituted.

6.4           AMENDMENT OF VESTING SCHEDULE

If at any time this Plan's vesting schedule is amended, then each Participant with at least three (3) years of service shall have his non-forfeitable percentage computed under the Plan in accordance with the vesting schedule that is most favorable to such Participant under either (a) the preamendment vesting schedule or (b) the post amendment vesting schedule, provided that each Participant's postamendment non-forfeitable percentage interest in and to his Matching Account shall not be less than the preamendment percentage in Trust.

  

56

  

ARTICLE 7 - WITHDRAWALS WHILE STILL EMPLOYED

7.1           WITHDRAWAL OF AFTER-TAX CONTRIBUTIONS

A Participant may elect to withdraw all or part of his After-Tax Account; provided, however, that no more than two such withdrawals shall be made in any Plan Year.

	
7.2

	
WITHDRAWAL OF BEFORE-TAX CONTRIBUTIONS AND ROLLOVER CONTRIBUTIONS

	
(a)

	
A Participant who has attained age 59-1/2 as of the effective date of any withdrawal pursuant to this Section may elect to withdraw all or any part of his Before-Tax Contributions or Rollover Contributions (other than any Rollover Contributions made to the Barnes Group Inc. Profit Sharing Retirement Plan) and the earnings attributable thereto.

	
(b)

	
A Participant who has not attained age 59-1/2 and who has withdrawn the total amount available for withdrawal under Section 7.1 may elect to make a withdrawal from his Before-Tax Account and earnings attributable thereto through December 31, 1988, or Rollover Account, including all earnings attributable thereto upon furnishing proof of financial hardship satisfactory to the Benefits Committee or its designee.  For purposes of this paragraph, a distribution is on account of hardship only if the distribution is both made on account of an immediate and heavy financial need of the Participant and is necessary to satisfy such financial need.  Such a withdrawal shall not exceed the amount required to meet the immediate and heavy financial need created by the hardship and shall not be reasonably available from other resources of the Participant.  To the extent a requested distribution is in

  

57

  

excess of the amount required to relieve the financial need or to the extent such need may be satisfied from other resources that are reasonably available to the Participant, the request for a hardship withdrawal distribution shall be denied.

A hardship withdrawal shall be deemed to be on account of an immediate and heavy financial need of the Participant if the distribution is on account of:

	
  

	
(i)

	
medical expenses described in Code section 213(d) previously incurred by the Participant, his spouse, or any dependents of the Participant (as defined in Code section 152) without regard to Code sections 152(b)(1), 152(b)(2) and 152(d)(1)(B)); or funds necessary for those persons to obtain medical care described in Section 213(d) of the Code;

	
  

	
(ii)

	
the purchase (excluding mortgage payments) of a principal residence for the Participant;

	
  

	
(iii)

	
payment of tuition, related educational expenses, and room and board expenses for the next twelve months of post-secondary education for the Participant, his or her spouse, children or dependents (as defined in Code section 152 without regard to Code sections 152(b)(1), 152(b)(2) and 152(d)(1)(B)) and any other situation prescribed by the IRS pursuant to Treas. Reg. 1.401(k)-1(d)(2)(iv)(C);

  

58

  

	
  

	
(iv)

	
payments necessary to prevent the eviction of the Participant from a principal residence or foreclosure on the mortgage of the Participant's principal residence;

	
  

	
(v)

	
funeral or burial expenses for the Participant’s deceased parent, spouse, children or dependents (as defined in Code section 152, without regard to Code section 152(d)(1)(B); or

	
  

	
(vi)

	
expenses for the repair of damage to the Participant’s principal residence that would qualify for the casualty deduction under Code section 165 (determined without regard to whether the loss exceeds 10% of adjusted gross income).

	
(c)

	
A request for a hardship withdrawal shall be deemed by the Benefits Committee or its designee as necessary to satisfy an immediate and heavy financial need of a Participant if the following requirements are satisfied:

	
  

	
(i)

	
the distribution is not in excess of the amount of the immediate and heavy financial need of the Participant, including any amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated as a result of the withdrawal in accordance with written procedures adopted by the Benefits Committee; and

	
  

	
(ii)

	
the Participant has obtained all distributions (including distributions of dividends under Section 11A.7(d) but not hardship distributions) and all nontaxable loans

  

59

  

currently available under the Plan and all plans maintained by the Company or an Affiliated Employer.

In addition to the foregoing criteria, the determination of whether a Participant has an immediate and heavy financial need and whether the distribution is necessary to satisfy such financial need shall be made by the Benefits Committee or its designee in accordance with uniform and nondiscriminatory standards on the basis of all relevant facts and circumstances.

If a hardship withdrawal is made, the Participant may not make any contributions pursuant to the Plan and all other plans (as defined in Treas. Reg. §1.401(k)-1(d)(3)(iv)(F)) maintained by the Company or an Affiliated Employer for a period of six months commencing with the Valuation Date following the date of the hardship withdrawal.

	
(d)

	
A Participant may not make more than two withdrawals in any Plan Year under this Section 7.2.

7.3           MATCHING ACCOUNT

Amounts in the Matching Account may not be withdrawn while the Participant is an Employee of the Employer or an Affiliated Employer.  However, with respect to an individual who was a participant in the Curtis Industries, Inc. 401(k) Retirement Savings Plan, at such time as the Participant shall have attained the age of 59-1/2 years, the Benefits Committee, at the election of the Participant, shall direct the Trustee to distribute all or a portion of the amount then credited to the Merged Asset Account attributable to Curtis employer matching contributions made prior to April 1,

  

60

  

2001.  Any such withdrawal shall be permitted once per Plan Year.  In the event that the Benefits Committee makes such a distribution, the Participant shall continue to be eligible to participate in the Plan on the same basis as any other Employee.  Any distribution made pursuant to this Section shall be made in a manner consistent with Article 8, including, but not limited to, all notice and consent requirements of Section 411(a)(11) of the Code and the Regulations thereunder.

7.4           PAYSOP ACCOUNT

Amounts in the PAYSOP Account may not be withdrawn while the Participant is an Employee of the Employer or an Affiliated Employer.

7.5           PROCEDURES AND RESTRICTIONS

To make a withdrawal, a Participant shall give written notice in accordance with procedures established by the Benefits Committee.  A withdrawal shall be made as of the applicable Valuation Date and the amount of such withdrawal shall be allocated among all of his Funds in proportion to the value of the Participant's Accounts from which the withdrawal is made as of the date of the withdrawal. All payments to a Participant under this Article 7 shall be made as soon as administratively practicable.  The account hierarchy for withdrawals is as follows: first, the After-Tax Account attributable to employee After-Tax Contributions; second, the After-Tax Account attributable to dividends on shares purchased with the employee After-Tax Contributions; and third, the Before-Tax Account.

  

61

  

7.6           PROFIT SHARING ACCOUNT

Amounts in the Profit Sharing Account may not be withdrawn while the Participant is an Employee of the Employer or an Affiliated Employer.

  

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ARTICLE 8 - DISTRIBUTION OF ACCOUNTS UPON TERMINATION OF EMPLOYMENT

8.1           AMOUNT OF PAYMENT; PAYMENT IN COMPANY STOCK

	
(a)

	
Upon termination of employment for any reason, a Participant may elect to have the vested portion of his Accounts distributed in cash as set forth in Section 8.2; provided that any Participant (or such Participant's beneficiary) may also elect to take payment of the balance in his Accounts which are invested in the Company Stock Fund, other than the Participant’s Profit Sharing Account, in whole shares of Company Common Stock, with any fractional shares being distributed in cash.  The amounts in each Account shall be determined as of the Valuation Date coincident with the date of distribution in accordance with such uniform and nondiscriminatory procedures established by the Benefits Committee.  Absent such an election a Participant who is entitled to payment of benefits and whose total vested account balance exceeds $5,000 ($1,000, effective for distributions made on or after March 28, 2005) may receive his benefits as soon as practicable after the Valuation Date next following his 65th birthday or on any earlier Valuation Date elected by the Participant.  For purposes of the foregoing sentence, the value of a Participant's vested account balance shall be determined without regard to that portion of the account balance that is attributable to rollover contributions (and earnings allocable thereto) within the meaning of Code sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16).  If the value of the Participant's vested account balance as so determined is $5,000 or less ($1,000 or less, effective for distributions made on or after March 28, 2005), the Plan shall distribute the

  

63

  

Participant's entire vested account balances as of the Valuation Date on or next succeeding the date of his termination.

	
(b)

	
If on October 10, 2003, the aggregate Value of a Participant's Company Stock Account attributable to (i) Before-Tax Contributions and After-Tax Contributions made after May 1, 1988 and prior to April 1, 2001 and (ii) to Prior Contributions transferred to the Company Stock Fund pursuant to Section 4.2 of the Plan as in effect on May 30, 2003, is less than the value of the Participant's Guarantee Account (as defined in such prior version of the Plan), then the difference shall be contributed to the Plan as a special contribution by the Employer to be allocated to the Account of such Participant, if such Participant is not a Highly Compensated Employee, or paid to the Participant in cash by the Company, if the Participant is a Highly Compensated Employee.

8.2           METHODS OF DISTRIBUTION

	
(a)

	
All distributions shall be made in one lump sum as soon after the applicable Valuation Date as practical. Unless otherwise elected by the Participant, distribution of a Participant's Accounts shall be made on or about 60 days after the Valuation Date coincident with or next following the latest of (i) his termination of employment with the Company (ii) the determination of his Disability, or (iii) his attainment of age 65.

	
(b)

	
In the case of a Participant who is a 5% owner of the Company (as defined in Section 416 of the Code), the distribution of the balances in all his Accounts shall be made not later than April 1st of the year following the year in which he attains 70 1⁄2; and in the case of a

  

64

  

Participant other than a 5% owner, the distribution of the balances in all his Accounts shall be made not later than the first day of April following the later of (A) the calendar year in which he attains 70 1⁄2, or (B) the calendar year in which occurs his termination of employment with the Company.  All distributions under this Plan shall comply with the final regulations issued under Code section 401(a)(9) at Treas. Reg. §§ 1.401(a)(9)-1 through 1.401(a)(9)-9, including the incidental death benefit requirements of Code section 401(a)(9)(G).

8.3           BENEFICIARY

In the event of a Participant's death, all amounts payable pursuant to Section 8.1 shall be paid in one lump sum to the Participant's Spouse, if any, or to such other person as may have been designated as the beneficiary by the Participant; provided, however, that no beneficiary designation other than a Spouse shall be effective with respect to a married Participant unless the Spouse consents in writing to the selection of another beneficiary, acknowledges the effect of such election, and said election is witnessed by a notary public.  In the absence of a Spouse or designated beneficiary the amounts payable shall be paid to the Participant's estate.  The lump sum payment required hereunder shall be made as soon as practicable following the Participant’s death.

8.4           FORFEITURES

If a Participant’s employment is terminated prior to becoming 100% vested in his Matching Account or his Profit Sharing Account, the vested portion of his Accounts shall be distributed pursuant to Section 8.1.  The non-vested portion of his Accounts shall be forfeited upon the earliest of the date on which the Participant (i) receives the entire vested portion of his Accounts in a lump

  

65

  

sum payment, (ii) incurs five consecutive one-year breaks in service, or (iii) dies.  The value of any forfeited amounts shall be applied to reduced future Company Contributions in accordance with applicable Treasury Regulations or, in the case of Profit Sharing Accounts, applied in accordance with Section 3.4(f).  If any such Participant is re-employed by an Employer prior to incurring five consecutive one-year breaks in service, the portion of the Participant’s Accounts that was forfeited shall be restored if the Participant repays the portion of his Accounts previously distributed, unadjusted for subsequent gains and losses, before the end of the five year period beginning with the date he is re-employed.

8.5           DISTRIBUTION OF PAYSOP ACCOUNTS

Notwithstanding anything provided to the con­trary herein, no Shares allocated to a Partici­pant's PAYSOP Account may be distributed from that Account before the end of the 84th month beginning after the month in which such Shares were allocated to such Participant's account in the PAYSOP. The preceding sentence shall not apply in the case of:

	
(a)

	
death, Disability, separation from service, or termination of the Plan;

	
(b)

	
a transfer of a Participant to the employment of an acquiring employer from the employment of the Employer in the case of a sale to the acquiring corporation of substantially all of the assets used by the Employer in a trade or business conducted by the Employer; or

  

66

  

	
(c)

	
a disposition of an Employer's inter­est in a subsidiary when the Participant con­tinues employment with such subsidiary;

	
(d)

	
any distribution required under Code Section 401(a)(9).

8.6           DIRECT ROLLOVER DISTRIBUTIONS

Notwithstanding any provision of the Plan to the contrary, if any distribution to a Distributee (i) totals $200 or more, and (ii) constitutes an Eligible Rollover Distribution, the Distributee may elect on a form provided by the Benefits Committee to have all or part of such Eligible Rollover Distribution paid in a direct rollover to an Eligible Retirement Plan selected by the Distributee.  For this purpose, a Distributee, an Eligible Rollover Distribution, and an Eligible Retirement Plan shall be defined as follows:

	
(a)

	
Distributee includes an Employee or former Employee.  In addition, the Employee's or former Employee's surviving Spouse and the Employee's or former Employee's Spouse or former Spouse who is the alternate payee under a qualified domestic relations order, as defined in Code section 414(p), are Distributees with regard to the interest of the Spouse or former Spouse.

	
(b)

	
Eligible Rollover Distribution means any distribution of all or any portion of the balance to the credit of the Distributee, excluding (i) any distribution that is (A) one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the Distributee or the joint lives (or joint life expectancies) of the

  

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Distributee and the Distributee’s designated Beneficiary (or (B) for a specified period of ten years or more or, (C) any distribution on account of hardship; (ii) any distribution to the extent such distribution is required under Code section 401(a)(9); (iii) any distribution made to a non-Spouse Beneficiary; (iv) dividends paid with respect to Company Stock and distributed pursuant to Code section 404(k); and (v) any other distribution designated by the Internal Revenue Service in official notices or regulations.  A portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax employee contributions; however, such portion may be transferred only to an individual retirement account or annuity described in Code section 408(a) or (b), or to a qualified defined contribution plan described in Code section 401(a) that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not includible;

	
(c)

	
Eligible Retirement Plan means a plan described below:

	
  

	
(i)

	
an individual retirement account described in Code section 408(a);

	
  

	
(ii)

	
an individual retirement annuity (other than an endowment contract) described in Code section 408(b);

  

68

  

	
  

	
(iii)

	
a qualified defined contribution plan and exempt trust described in Code sections 401(a) and 501(a) respectively, the terms of which permit the acceptance of rollover contributions;

	
  

	
(iv)

	
an annuity plan described in Code section 403(a);

	
  

	
(v)

	
an annuity contract described in Code section 403(b);

	
  

	
(vi)

	
an eligible plan under Code section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan; or

	
  

	
(vii)

	
effective January 1, 2008, a Roth IRA described in Code section 408A.

If an election is made to have only a part of an eligible rollover distribution paid in a direct rollover, the amount of the direct rollover must total $500 or more.

Direct rollovers shall be accomplished in accordance with procedures established by the Committee, including, in the case of distributions not subject to the consent requirements of Code section 411(a)(11), procedures for affirmatively waiving the minimum notice period described in Treas. Reg. § 1.402(c)-2T.

  

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The procedures established by the Committee shall be made in accordance with the rules set forth in Treas. Reg. § 1.401(a)(31)-1T.

  

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ARTICLE 9 - ADMINISTRATION OF PLAN

9.1           APPOINTMENT OF BENEFITS COMMITTEE

The general administration of the Plan and the responsibility for carrying out the provisions of the Plan shall be placed in the Benefits Committee appointed from time to time by the Board of Directors of the Company to serve at the pleasure of the Board of Directors.  Any person who is appointed a member of the Benefits Committee shall signify his acceptance by filing written acceptance with the Board of Directors and the Secretary of the Benefits Committee.  Any member of the Benefits Committee may resign by delivering his written resignation to the Board of Directors and the Secretary of the Benefits Committee.  A member of the Benefits Committee may be a Participant in the Plan.

9.2           OPERATION OF BENEFITS COMMITTEE

	
(a)

	
The members of the Benefits Committee shall elect a chairman from their number and a secretary who may be but need not be one of the members of the Benefits Committee; may appoint from their number such subcommittees with such powers as they shall determine; may authorize one or more of their number or any agent to execute or deliver any instrument or make any payment on their behalf; may retain counsel, employ agents and provide for such clerical, accounting, and consulting services as they may require in carrying out the provisions of the Plan; and may allocate among themselves or delegate to other persons all or such portion of their duties under the Plan, as they, in their sole discretion, shall decide.

  

71

  

	
(b)  

	
The Benefits Committee shall hold meetings upon such notice, at such place or places, and at such time or times as it may from time to time determine.  Any act which the Plan authorizes or requires the Benefits Committee to do may be done by a majority of its members.  The action of that majority expressed from time to time by vote at a meeting or in writing without a meeting shall constitute the action of the Benefits Committee and shall have the same effect for all purposes as if assented to by all members of the Benefits Committee at the time in office.  Any member of the Benefits Committee who is a Participant shall not vote on any question relating exclusively to himself.

	
(c)  

	
No member of the Benefits Committee shall receive any compensation from the Plan for his services as such.

9.3           GENERAL DUTIES OF THE BENEFITS COMMITTEE

	
(a)

	
Subject to the limitations of the Plan, the Benefits Committee from time to time shall have the full discretionary authority to establish rules for the administration of the Plan and the transaction of its business.

	
(b)

	
The Benefits Committee shall have the full discretionary authority to interpret the Plan and its determination of all questions arising under the Plan shall be conclusive upon all Participants and all other interested or affected parties.

  

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(c)

	
The Benefits Committee shall maintain, or cause to be maintained, records showing the individual balances in each Participant's Accounts.  However, maintenance of those records and Accounts shall not require any segregation of the funds of the Plan.

	
(d)

	
The Benefits Committee shall act as the named fiduciary responsible for communications with Participants as needed to maintain Plan compliance with Section 404(c) of ERISA, including but not limited to the receipt and transmitting of Participant’s directions as to the investment of their account(s) under the Plan and the formulation of policies, rules, and procedures pursuant to which Participants may give investment instructions with respect to the investment of their accounts.

	
(e)

	
Whenever the Plan requires that a form be filed, the Benefits Committee may provide for such form to be filed by such electronic and/or telephonic means as it shall determine, in the exercise of its discretionary authority, and may further provide for such form to be filed with its designee.

9.4           BINDING ACTION

To the fullest extent permitted by law, the Benefits Committee shall have full discretion as to the exercise of its respective powers, duties, and responsibilities under the Plan and all actions taken and decisions made by the Benefits Committee shall be final, conclusive and binding on all persons having any interest in the Plan or in any benefits payable thereunder in the absence of clear and convincing evidence that the Committee acted arbitrarily or capriciously.  Benefits under the Plan

  

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will be paid only if the Benefits Committee decides in its discretion that the individual applying for the benefits is entitled to them.

9.5           CLAIMS PROCEDURE

The Benefits Committee shall adopt procedures for the filing and review of claims for benefits in accordance with the requirements of Section 503 of ERISA.  Such claims procedures are specifically incorporated herein by reference.

9.6           INDEMNITY

The Benefits Committee and the individual members thereof shall be indemnified by the Company to the fullest extent permitted by law against any and all liabilities arising by reason of any act or failure to act made in good faith pursuant to the provisions of the Plan, including expenses reasonably incurred in the defense of any claim relating thereto.

9.7           PLAN EXPENSES

All usual and reasonable expenses of administration (as determined by the Benefits Committee) shall be paid out of the Trust Fund unless paid by the Company.  Such expenses shall include any expenses incident to the functioning of the Benefits Committee, or any person or persons retained or appointed by the Benefits Committee incident to the exercise of its duties under the Plan, including, but not limited to, fees of accountants, counsel, investment managers, agents (including nonfiduciary agents) appointed for the purpose of assisting the Benefits Committee or the Trustee in carrying out the instructions of Participants as to the directed investment of their accounts and other specialists and their agents, and other reasonable costs of administering the

  

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Plan. Until paid, the expenses shall constitute a liability of the Plan.  Any expenses of the Plan related to a qualified domestic relations order, as defined in Code section 414(p), or an order purporting to be a qualified domestic relations order, shall be charged to the account of the Participant with respect to whom such order was entered.

  

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ARTICLE 10 - LOANS

10.1           LOAN LIMITS

	
(a)

	
A Participant may borrow from the Plan an amount which, when added to all loans hereunder and to all loans outstanding from any other plans of the Employer and all Affiliated Employers which are qualified under Code section 401(a), does not exceed the lesser of:

	
  

	
(i)

	
$50,000 (less the highest outstanding loan balance in the 12 months preceding any loan) or

	
  

	
(ii)

	
50% of the present value of such Participant's vested interest in his Accounts (including his Rollover Account), other than the Participant’s Profit Sharing Account.

	
(b)

	
Loans shall not be made available to Highly Compensated Employees  in an amount greater than the amount made available to other Employees.  The amount in a Participant's PAYSOP Account shall be taken into account in determining the amount of any loan that may be permitted under this Section 10.1; provided, however, that no portion of any loan to a Participant may be made from amounts in such Participant's PAYSOP Account.  No portion of any loan to a Participant may be made from amounts in such Participant's Profit Sharing Account.

  

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10.2           INTEREST

All loans shall bear a reasonable rate of interest as established by the Benefits Committee in a nondiscriminatory manner.

10.3           TERM

Any loan by its terms must require that repayment (principal and interest) be amortized in level payments, not less frequently than quarterly, over a period not extending beyond five years from the date of the loan, provided, however, that any loan shall be repaid (or treated as a distribution) upon the Participant's termination of employment for any reason.

10.4           SECURITY

Loans must be evidenced by written notes and must be adequately secured.  In the event of default, foreclosure on the note and attachment of security will not occur until a distributable event occurs in the Plan.

10.5           FREQUENCY/MINIMUM AMOUNTS

A loan may be taken out no more than once in any calendar year, and a Participant may have no more than three loans outstanding at one time.  The minimum loan is $1,000.

  

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10.6           FEES

A Participant who borrows from the Plan, in accordance with this Article 10, shall be charged a loan origination fee in an amount equal to the amount charged by the Company’s recordkeeper to administer such loan, as it may be amended from time to time.  Such fee shall be calculated at the inception of each new loan under the Plan and shall be included as part of the amount borrowed.

10.7           PARTICIPANT LOAN PROGRAM

The Benefits Committee shall establish a Participant Loan Program contained in a separate written document which, when properly executed, shall be incorporated by reference and made a part of the Plan.  Such Participant Loan program shall include, but need not be limited to the following:

	
(i)  

	
the identity of the person or position authorized to administer the Participant Loan Program;

	
(ii)  

	
a procedure for applying for loans

	
(iii)  

	
the basis on which loans will be approved or denied;

	
(iv)  

	
limitations, if any, on the types and amounts of loans offered;

	
(v)  

	
the procedure for determining a reasonable rate of interest;

	
(vi)  

	
the types of collateral which may secure a Participant loan; and

  

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(vii)  

	
events constituting default and the steps that will be taken to preserve Plan assets.

The Participant loan program may be modified or amended in writing from time to time without the necessity of amending the Plan.

 

  

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ARTICLE 11 - TRUSTEE

11.1           TRUST

The assets of the Plan shall be held in trust by the Trustee or Trustees appointed pursuant to the provisions of Article 11.

11.2           APPOINTMENT OF TRUSTEE

The Benefits Committee by majority vote shall appoint a trustee or trustees (hereinafter referred to as the “ESOP Trustee”).  Any trustee may be removed with or without cause by the Benefits Committee or by the chief executive officer of the Company.  Each trustee appointed by the Benefits Committee shall execute an agreement in a form prescribed by the Benefits Committee under which the Trustee shall accept his appointment and agree to be bound by the provisions of this Plan. 

  

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ARTICLE 11A - ACQUISITION OF SHARES WITH ESOP LOANS; CERTAIN ALLOCATION RULES

11A.1           TERMS OF ESOP LOAN

The ESOP Trustee is empowered in its sole discretion (1) to borrow funds (including a borrowing from the Company or any other of the Affiliated Employers) and (2) to use such funds in accordance with Section 11A.2 hereof to acquire Company Stock to fund Before-Tax Contributions and Matching Allocations, or to repay a prior ESOP Loan, subject to the following conditions:

	
  

	
(a)

	
An ESOP Loan shall be primarily for the benefit of the Participants and their Beneficiaries.

	
  

	
(b)

	
The terms of each ESOP Loan must, at the time the loan is made, be at least as favorable to the Trust as the terms of a comparable loan resulting from arm's length negotiations between independent parties.

	
  

	
(c)

	
Each ESOP Loan shall be for a specific term, shall bear a reasonable rate of interest, and shall be without recourse against the Trust or the Participants' Accounts, except that an ESOP Loan may be guaranteed by the Company and may be secured by a pledge of the Shares acquired with the proceeds of the ESOP Loan (or acquired with the proceeds of a prior ESOP Loan which is being refinanced).

  

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(d)

	
No other Trust assets may be pledged as collateral for an ESOP Loan, and no lender shall have recourse against Trust assets other than (i) collateral given for the ESOP Loan, (ii) amounts held under the ESOP Loan Payment Accumulation Account and (iii) earnings attributable to such collateral.

	
  

	
(e)

	
An ESOP Loan shall not be payable on demand except in the event of default.  In the event of default, the value of Plan assets transferred in satisfaction of the ESOP Loan shall not exceed the amount of the default plus any applicable prepayment or similar penalties or premiums.

	
  

	
(f)

	
If the lender is a disqualified person within the meaning of Code Section 4975(e)(2), the ESOP Loan must provide for a transfer of Trust assets on default only upon and to the extent of the failure of the Trust to meet the payment schedule of the ESOP Loan.

	
  

	
(g)

	
Payments of principal and/or interest on any ESOP Loan shall be made by the ESOP Trustee in accordance with Section 11A.5.

11A.2           ACQUISITION OF SHARES WITH PROCEEDS OF ESOP LOAN

The ESOP Loan proceeds shall be used by the ESOP Trustee within a reasonable time after receipt to acquire Shares or to repay a prior ESOP Loan.  In acquiring Shares, the ESOP Trustee shall take all appropriate and necessary measures to ensure that the Trust pays no more than "adequate consideration" (within the meaning of Section 3(18) of ERISA) for such securities.  All Shares

  

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acquired with the proceeds of an ESOP Loan shall be placed in an ESOP Loan Suspense Account established by the ESOP Trustee.  To the extent required for the purpose of pledging such Shares as collateral for the ESOP Loan, the Shares held as collateral in the ESOP Loan Suspense Account may be physically segregated from other Trust assets.  Any pledge of Shares must provide for the release of a portion of such Shares (in accordance with Section 11A.6 hereof) not later than the end of the Plan Year with respect to which payments on the ESOP Loan are made by the ESOP Trustee and for Shares so released to be transferred as appropriate for allocation to Participants' Before-Tax and Matching Accounts pursuant to the terms of the Plan.

11A.3           SHARES TO BE UNRESTRICTED

No Shares acquired with the proceeds of an ESOP Loan shall be subject to any put, call or other option or any buy-sell or similar agreement while held by or when distributed from the Trust, whether or not the Plan constitutes an "employee stock ownership plan" within the meaning of Code section 4975(e)(7) at such time and whether or not the ESOP Loan has been repaid at such time.

  

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11A.4           ESOP LOAN AMORTIZATION PAYMENTS

The Trustee shall transfer all dividends received on Shares acquired prior to August 4, 1989 to the ESOP Loan Payment Accumulation Account to be used to repay principal and interest on the ESOP Loan (including, to the extent directed by the Benefits Committee, to make prepayments on such ESOP loan).  When dividends on shares allocated to a Participant's account are used to repay principal and interest on the ESOP loan, Shares with a fair market value not less than the amount of such dividend shall be allocated to the Participant's account for the year in which such dividend would have been otherwise allocated to the Participant's account.  Dividends in excess of amounts used to make ESOP Loan Amortization payments shall be used by the ESOP Trustee to purchase Shares on the open market.  To the extent directed by the Benefits Committee, Before-Tax Contributions and Company Contributions shall either (i) be transferred by the ESOP Trustee to the ESOP Loan Payment Accumulation Account to be used to make ESOP Loan amortization payments, or (ii) be used by the ESOP Trustee to purchase Shares on the open market.  The Benefits Committee shall ensure that sufficient amounts are transferred to the ESOP Loan Payment Accumulation Account to make outstanding ESOP Loan amortization payments as they become due.

  

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11A.5           ESOP LOAN PAYMENTS

To the extent necessary to make ESOP Loan amortization payments, funds in the ESOP Loan Payment Accumulation Account shall be used in the following order of priority:

	
  

	
(a)

	
Dividends on Shares (allocated and unallocated) which were acquired with the proceeds of an ESOP Loan and earnings thereon;

	
  

	
(b)

	
Before-Tax Contributions that are allocated to the ESOP Loan Payment Accumulation Account and earnings thereon;

	
  

	
(c)

	
Company Contributions that are allocated to the ESOP Loan Payment Accumulation Account and earnings thereon; and

	
  

	
(d)

	
To the extent permitted by law, proceeds from the sale, exchange, or disposition of Shares or other assets held in the ESOP Loan Suspense Account and earnings thereon.

11A.6           RELEASE FROM ESOP LOAN SUSPENSE ACCOUNT

As of the beginning of each quarter, a number of Shares shall be released from the ESOP Loan Suspense Account.  Such number shall be determined as follows:  the number of Shares held in the ESOP Loan Suspense Account as of the end of the preceding quarter shall be multiplied by a fraction, the numerator of which shall be the amount of principal and interest paid for the current

  

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quarter, and the denominator shall be the numerator plus the principal and interest to be paid on all future amortization payments.  The resulting number of Shares divided by three shall be allocated as of the last day of each month during the applicable quarter in satisfaction of the following obligations in the following order of priority:

	
  

	
(a)

	
In complete or partial satisfaction of the obligation to credit Dividend Replacement Shares (as set forth in Section 11A.7(a) hereof);

	
  

	
(b)

	
In partial satisfaction of Matching Allocations (as described in Section 3.3 hereof), but only to the extent the source of repayment of the ESOP Loan consists of dividends described in Section 11A.7(b) hereof;

	
  

	
(c)

	
In complete or partial satisfaction of Before-Tax Contributions (to the extent that the ESOP Loan amortization payment was made with Before-Tax Contributions and Supplemental Contributions as described in Section 3.1 hereof); and

	
  

	
(d)

	
In complete or partial satisfaction of any remaining Matching Allocations (as described in Section 3.3 hereof).

11A.7           USE OF DIVIDENDS

	
  

	
(a)

	
As of the end of any quarter in which a dividend is paid on Shares which (i) were credited to Participants' Before-Tax and Matching Accounts as of the record date for

  

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the payment of such dividend and (ii) were acquired with the proceeds of an ESOP Loan, the ESOP Trustee shall allocate to Participants' Before-Tax and Matching Accounts, through Shares released from the ESOP Loan Suspense Account or otherwise as described in Section 11A.4 hereof, additional Shares ("Dividend Replacement Shares") having a Value equal to the amount of such dividends and earnings thereon.

	
  

	
(b)

	
Dividends on any Shares that were acquired with an ESOP Loan (other than Shares described in paragraph (a) above) shall be used to repay principal and interest on such ESOP Loan in partial satisfaction of the Matching Allocation as provided in Section 3.3.

	
  

	
(c)

	
Dividends on Shares not acquired with the proceeds of an ESOP Loan shall be used to acquire additional Shares on the open market.

	
  

	
(d)

	
Notwithstanding the foregoing, and in lieu thereof, Participants may elect, in such manner as provided by the Benefits Committee, to have any dividends paid for a Plan Year on Shares which were credited to their Before-Tax and Matching Accounts as of the record date(s) for the payment of such dividends be distributed to them within 90 days of the end of such Plan Year.

  

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ARTICLE 12 - GENERAL PROVISIONS

12.1           EXCLUSIVE BENEFIT RULE

Except as otherwise provided in the Plan, no part of the corpus or income of the funds of the Plan shall be used for, or diverted to, purposes other than for the exclusive benefit of Participants and other persons entitled to benefits under the Plan.  No person shall have any interest in or right to any part of the earnings of the Funds of the Plan, or any right in, or to, any part of the assets held under the Plan, except as and to the extent expressly provided in the Plan.

12.2           NONALIENATION

Except as required by an applicable law, no benefit under the Plan shall in any manner be anticipated, assigned or alienated, and any attempt to do so shall be void.  Notwithstanding the foregoing, if there is entered any Qualified Domestic Relations Order that affects the payment of benefits hereunder, such benefits shall be paid in accordance with the applicable requirements of such Order. An order shall not fail to be a Qualified Domestic Relations Order merely because it requires a distribution to an alternate payee before the Participant is otherwise entitled to a distribution under the Plan. 

Notwithstanding any provision of this Section to the contrary, an offset to a Participant’s accrued benefit against an amount that the Participant is ordered or required to pay the Plan with respect to a judgment, order or decree issued, or a settlement entered into, on or after August 5, 1997, shall be permitted in accordance with Code sections 401(a)(13)(C) or (D).

  

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12.3           CONDITIONS OF EMPLOYMENT NOT AFFECTED BY PLAN

The establishment of the Plan shall not confer any legal rights upon any employee or other person for a continuation of employment nor shall it interfere with the rights of the Employer to discharge any Employee and to treat him without regard to the effect which that treatment might have upon him as a Participant of the Plan.

12.4           FACILITY OF PAYMENT

If the Benefits Committee shall find that a Participant or other person entitled to a benefit is unable to care for his affairs because of illness or accident or is a minor, the Benefits Committee may direct that any benefit due him, unless claim shall have been made for the benefit by a duly appointed legal representative, be paid to his spouse, a child, a parent or other blood relative, or to a person with whom he resides.  Any payment so made shall be a complete discharge of the liabilities of the Plan for that benefit.

12.5           INFORMATION

Each Participant or other person entitled to a benefit, before any benefit shall be payable to him or on his account under the Plan, shall file with the Benefits Committee the information that it shall require to establish his rights and benefits under the Plan.

  

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12.6           CONSTRUCTION

The Plan shall be construed, regulated and administered under ERISA, as in effect from time to time, and the laws of the State of Connecticut, except where ERISA controls.

12.7           INABILITY TO LOCATE DISTRIBUTEE

Notwithstanding any other provisions of the Plan, in the event the Benefits Committee cannot locate any person to whom a payment is due under the Plan, the benefit in respect of which such payment is to be made shall be forfeited at such time as the Benefits Committee shall determine in its sole discretion (but in all events prior to the time such benefit would otherwise escheat under any applicable state law); provided that such benefit shall be reinstated if such person subsequently makes a valid claim for such benefit.

12.8           NAMED FIDUCIARIES

The named fiduciaries, who shall have authority to control and manage the operation and administration of the Plan, are as follows:

	
(a)

	
the Benefits Committee, which shall have the authority and duties specified in Article 8 hereof; and

  

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(b)

	
the Trustee, who shall have the authority and duties specified in the Plan and Trust Agreement.

12.9           QUALIFIED DOMESTIC RELATIONS ORDERS. 

The Benefits Committee shall have full discretionary authority and responsibility to establish procedures and to determine whether an order or other decree is a Qualified Domestic Relations Order.  Such procedures are specifically incorporated herein by reference.  For purposes of the Plan, a QDRO may require that distributions from a Participant’s account or accounts under the Plan be paid to the alternate payee or payees named in such QDRO in a manner consistent with the distribution options otherwise available under the Plan, regardless of whether the Participant is otherwise entitled to a distribution at such time under the Plan.  The provisions of this Section 12.9 shall supersede any provision of the Plan to the contrary.

  

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ARTICLE 13 - AMENDMENT, MERGER AND TERMINATION

13.1           AMENDMENT OF PLAN

	
(a)

	
The Board of Directors or, in the event the Board has so delegated its authority, the Benefits Committee may amend the Plan in whole or in part at anytime, and retroactively if deemed necessary or appropriate by a majority vote of its members.  However, no amendment shall make it possible for any part of the Funds of the Plan to be used for, or diverted to, purposes other than for the exclusive benefit of persons entitled to benefits under the Plan.  No amendment shall be made which has the effect of decreasing the balance of the Accounts of any Participant or of reducing the nonforfeitable percentage of the balance of the Accounts of a Participant below the nonforfeitable percentage computed under the Plan as in effect on the date on which the amendment is adopted or, if later, the date on which the amendment becomes effective. 

	
(b)

	
The Senior Vice President, Human Resources, acting without the Board or the Benefits Committee, may make any amendment to the Plan  (not otherwise prohibited under paragraph (a)) which he or she determines to be either (i) of a technical or administrative nature, or (ii) necessary to preserve the tax qualification of the Plan or compliance of the Plan with other requirements of law, provided, that no amendment described in (i) or (ii) above that purports to amend the provisions of this Section 13.1, or that would be likely to increase materially the costs of the Plan to the Employer, shall take effect without the approval of the Board or Benefits Committee.

  

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13.2           MERGER OR CONSOLIDATION

The Plan may not be merged or consolidated with, and its assets or liabilities may not be transferred to, any other plan unless each person entitled to benefits under the Plan would, if the resulting plan were then terminated, receive a benefit immediately after the merger, consolidation or transfer which is equal to or greater than the benefit he would have been entitled to receive immediately before the merger, consolidation, or transfer if the Plan had been terminated and such other plan and fund are qualified under Code sections 401(a) and 501(a).

13.3           ADDITIONAL PARTICIPATING EMPLOYERS

	
(a)

	
If any company is or becomes a subsidiary of or associated with an Employer, the Board of Directors may include the employees of that subsidiary or associated company in the membership of the Plan upon appropriate action by that company necessary to adopt the Plan.  In that event, or if any persons become Employees of an Employer as the result of acquisition of all or part of the assets or business of another company, the Board of Directors shall determine to what extent, if any, previous service with the subsidiary, associated or other company shall be recognized under the Plan, but subject to the continued qualification of the Trust for the Plan as tax-exempt under the Internal Revenue Code.

	
(b)

	
Any subsidiary or associated company may terminate its participation in the Plan upon appropriate action by it.  In that event the funds of the Plan held on account of Participants in the employ of that company, and any unpaid balances of the Accounts of all Participants

  

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who have separated from the employ of that company, shall be determined by the Benefits Committee.  Those funds shall be distributed as provided in Section 13.4 if the Plan should be terminated, or shall be segregated by the trustees as a separate trust, pursuant to certification to the trustees by the Benefits Committee, continuing the Plan as a separate plan for the employees of that company under which the Board of Directors of that company shall succeed to all the powers and duties of the Board of Directors, including the appointment of the members of the Benefits Committee.

	
(c)

	
Any amendment or termination of the Plan by the Company under Sections 13.1 or 13.4 shall bind all participating employers, if any, without the requirement for action or consent on the part of any such participating employer.  In addition, no participating employer other than the Company shall have any power to amend, modify, suspend or terminate the Plan as to its own or any other participating employer's participation therein, and all such power is exclusively vested in the Company.  In addition, the Plan shall be treated as if it were maintained by a single employer, and the withdrawal from participation in the Plan of one or more participating employers shall not be deemed to be a termination or partial termination of the Plan with respect to the participants employed by such participating employers unless required to be treated as such by applicable laws or regulations.

13.4           TERMINATION OF PLAN

The Board of Directors may terminate the Plan or completely discontinue contributions under the Plan for any reason at any time.  In case of termination or partial termination of the Plan, or

  

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complete discontinuance of Employer contributions to the Plan, the rights of affected Participants to their Accounts under the Plan as of the date of the termination or discontinuance shall be nonforfeitable.  The total amount in each Participant's Accounts shall be distributed, as the Benefits Committee shall direct, to him or for his benefit or continued in trust for his benefit, except that in the case of Before-Tax Contributions such Before-Tax Contributions shall be distributed only in accordance with the provisions of Article 8.

  

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ARTICLE 14 - TOP-HEAVY PROVISIONS

14.1           APPLICATION OF ARTICLE

	
  

	
This Article 14 shall apply for Plan Years beginning after December 31, 1983.

14.2           DEFINITIONS

	
  

	
For purposes of this Article, the following definitions apply:

	
(a)

	
Key Employee.  The term “key employee” means any Employee or former Employee (including any deceased Employee) who at any time during the Plan Year that includes the determination date was an officer of the Employer or Affiliated Employer having Annual Compensation greater than $130,000 (as adjusted under Code section 416(i)(1) for Plan Years beginning after December 31, 2002), a 5-percent owner of the Employer, or a 1-percent owner of the Employer having "Annual Compensation" of more than $150,000.  For this purpose, "Annual Compensation" means Annual Pay within the meaning of Code section 415(c)(3).  The determination of who is a Key Employee will be made in accordance with Code section 416(i)(1) and the applicable regulations and other guidance of general applicability issued thereunder.

  

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14.3

	
DETERMINATION OF TOP-HEAVY STATUS

As of each determination date, the Company shall compute the aggregate accrued benefits of all Key Employees of the Company.  If within the meaning of Section 416(g) of the Internal Revenue Code, the aggregate accrued benefits of all Key Employees exceeds 60% of the aggregate accrued benefits of all Employees, then the Plan will be deemed to be “top-heavy” for the Plan Year next following such determination date (and in the case of the first Plan Year, for the Plan Year ending with such determination date).  In making this determination, there shall be considered (i) all other qualified plans of the Company and any Affiliated Employer in which a Key Employee is a Participant, and (ii) all other qualified plans of the Company or any Affiliated Employer which enable this Plan or plans described in (i) above to meet the requirements of Code section 401(a)(4) or 410, and (iii) at the option of the Company, any other qualified plans of the Company or an Affiliated Employer which meet the requirements of Code section 401(a)(4) and 410.  If any other plans of the Company or an Affiliated Employer are aggregated with this Plan as described in the preceding sentence, this Plan shall be deemed to be top-heavy only if the aggregated plans are a “top-heavy group,” as defined in Code section 416(g)(2)(B).  For purposes of determining the present values of accrued benefits and the amounts of account balances of Employees as of the determination date, the following rules shall apply:

	
(a)

	
The present values of accrued benefits and the amounts of account balances of an Employee as of the determination date shall be increased by the distributions made with respect to the Employee under the Plan and any Plan aggregated with the Plan under Code section

  

97

  

416(g)(2) during the 1-year period ending on the determination date.  The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Code section 416(g)(2)(A)(i) .  In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting "5-year period" for "1-year period."

	
(b)

	
The accrued benefits and accounts of any individual who has not performed services for the Employer during the 1-year period ending on the determination date shall not be taken into account.

14.4           MINIMUM COMPANY CONTRIBUTION

Notwithstanding any other provision of this Plan except the limitations set forth in this Section 14.4, for any Plan Year in which this Plan is top-heavy, there shall be allocated to the Before-Tax Contribution Account of each Participant (and each Employee who would have become a Participant had he not declined to execute a Before-Tax election) an amount of not less than 3% of such individual's compensation as defined in Section 14.2(d); provided that (i) this minimum contribution shall not be made to a Participant or Employee who is a Key Employee for the Plan Year or who has separated from service prior to the last day of the Plan Year, and (ii) this minimum contribution shall be provided solely by Company contributions (which shall include Company contributions to such individual's Before-Tax Contribution Account under Section 3.1 of this Plan and Matching Allocations made to such individual's Matching Account under Section 3.3 of this Plan).  Notwithstanding the foregoing, if the largest percentage of compensation contributed or required to be contributed by the Company to any Key Employee for the Plan Year is less than 3%

  

98

  

(considering only the first $200,000 of compensation for Key Employees), then the amount allocable to each eligible individual hereunder shall be that lesser percentage.  For purposes of this Section 14.4, all defined contribution plans of the Company shall be aggregated to the end that the minimum contribution requirement shall be satisfied if the aggregate contributions attributable to Company contributions and forfeitures if any, made to all defined contribution plans equal 3% (or applicable lesser percentage) of any such individual's compensation.

 

If a Participant is covered under any qualified defined benefit plan of the Company, then the minimum benefit or the minimum contribution requirement applicable should this Plan or the other plan become top-heavy shall be satisfied by the minimum benefit provisions of the defined benefit plan rather than the minimum contribution provisions of this Plan.

  

99

  

ARTICLE 15 – MILITARY VETERANS’ MAKE-UP CONTRIBUTIONS

15.1           QUALIFIED MILITARY SERVICE

“Qualified Military Service” means any service in the Armed Forces (or other Uniformed Service as provided in the Uniformed Services Employment and Reemployment Rights Act (the ‘USERRA’) which is credited to an Employee upon his or her return to employment with the Employer or Affiliated Employer on or after December 12, 1994 and within the period during which his or her employment rights are protected by USERRA.

15.2           SERVICE CREDIT

An employee who has Qualified Military Service shall receive credit under this Plan for such service in the same manner and under the same rules as if the service had been performed for the Employer or an Affiliated Employer.

15.3           MAKE-UP CONTRIBUTIONS

An Employee may elect to make up some or all of the Before-Tax Contributions and/or After-Tax Contributions that could otherwise have been made during the period of Qualified Military Service.  The amount of such contributions shall not exceed the amount that could have been made in accordance with all Plan provisions and limits that would have applied during such period.  Compensation will be imputed for the period of Qualified Military Service based on the rate

  

100

  

of pay the Employee would have received during such period.  The election shall be made in a manner similar to that used for current Before-Tax Contributions and/or After-Tax Contributions and the Employee may elect to change, suspend or cease such contributions in accordance with the provisions in effect at the time of such election.

15.4           MAXIMUM TIME LIMIT

The maximum time limit for making such contributions shall be the lesser of three (3) times the duration of the Qualified Military Service or five (5) years and is measured from the later of January 1, 1997 or the date the Employee is reemployed following such absence.

15.5           MATCHING ALLOCATIONS

Matching Allocations shall be made in the same amount and at the same relative time as would have applied had the make-up contributions by the Employee been made during the period of Qualified Military service.

15.6           NO RETROACTIVE INVESTMENT RETURN

All make-up contributions and Matching Allocations shall be invested in accordance with the Section 4.1 when the contributions are actually made.  No retroactive adjustment in the Participant’s Accounts will be made for investment gains or losses for any period prior to the date the contributions are actually made.

  

101

  

15.7           LOAN REPAYMENTS

The Benefits Committee may adopt rules of uniform application that will allow loan repayments to be suspended for some or all of the period of Qualified Military Service.  Such suspension will not result in default and the period of suspension will defer the date on which the loan is scheduled to be fully repaid.  Interest shall accrue on such loan balance during the period of suspension and shall become payable upon the resumption of employment; provided, that any such interest accrued during the military service period will be limited to no more than 6% if the Participant supplies to the Benefits Committee or its designee a copy of the Participant’s military orders and a written request that the 6% interest rate limit be applied during a period that is no longer than the term established at the inception of the loan, plus the period of such military service..  Loan repayments shall resume upon re-employment and will be increased to repay the then outstanding balance, including interest that accrued during the Qualified Military Service.  A new loan agreement shall be issued at that time.

15.8           TESTING

Contributions made under this Article 15 shall be excluded from all testing in Plan Years subsequent to the Plan Year to which the contributions relate and Plan Years prior to the Plan Year in which they are actually made.

  

102

  

15.9           COMPLIANCE

The provisions of this Article 15 shall be administered to comply with Section 414(u) of the Code and applicable regulations.

  

103

  

IN WITNESS WHEREOF, the Company has caused this Amended and Restated Plan to be executed by its duly authorized officer and its corporate seal to be hereunto affixed this 29th day of June, 2009.

	
WITNESS

	
BARNES GROUP INC.

	  	  	  
	  	  	  
	
Caroline Seger

	
By:

	
/s/ John R. Arrington

	  	
Title:

	
Senior Vice President, Human Resources and Chairperson, Benefits Committee

  

104

  

BARNES GROUP INC. RETIREMENT SAVINGS PLAN

SUPPLEMENT A

Special Provisions Applicable to Employees Participating

in the Windsor Manufacturing Profit Sharing Plan

PURPOSE

Effective May 1, 1988, Barnes Group Inc. adopted the Barnes Group Inc. Profit Sharing Plan and directed that Windsor Manufacturing Profit Sharing Plan (the "Windsor Plan") be merged into the Barnes Group Inc. Profit Sharing Plan.   On May 30, 2003, the Barnes Group Inc. Profit Sharing Plan was merged into the Plan.  This Supplement A sets forth special provisions of the Plan applicable to individuals who were participants of the Windsor Plan (the "Windsor Participants") prior to May 1, 1988.

	
A1

	
Service Prior to May 1, 1988.

	
  

	
In determining a Windsor Participant's Hours of Service, Period of Service and Severance from Service Date, in respect of periods prior to May 1, 1988, employment with or severance from Windsor Manufacturing Division of Barnes Group Inc. (or one or more predecessors thereof) prior to May 1, 1988 shall be treated as employment with or severance from the Employer.

  

105

  

A2           Vesting.

	
A2.1

	
Prior Vesting Preserved.  A Windsor Participant's right to the value of his Optional Contribution Account, Rollover Account and Voluntary Account as of December 31, 1987 shall be 100% vested and nonforfeitable at all times on or after December 31, 1987.

	
A2.2

	
Vesting in Participant's Regular Account.  A Windsor Participant's right to the value of his Regular Account and Separate Account as of December 31, 1987 shall be 100% vested and nonforfeitable at all times on or after January 1, 1988.

	
  

	
   

  

106

  

BARNES GROUP INC. RETIREMENT SAVINGS PLAN

SUPPLEMENT B

Special Provisions Applicable to Employees Participating

 in the Central Metal Products Profit Sharing Plan

PURPOSE

Effective May 1, 1988, Barnes Group Inc. adopted the Barnes Group Inc. Profit Sharing Plan and directed that Central Metal Products Profit Sharing Plan (the "Central Metal Plan") be merged into the Barnes Group Inc. Profit Sharing Plan.  On May 30, 2003, the Barnes Group Inc. Profit Sharing Plan was merged into the Plan.  This Supplement B sets forth special provisions of the Plan applicable to individuals who were participants of the Central Metal Plan (the "Central Metal Participants") prior to May 1, 1988.

	
B1

	
Service Prior to May 1, 1988.

	
  

	
In determining a Central Metal Participant's Hours of Service, Period of Service and Severance from Service Date, in respect of periods prior to May 1, 1988, employment with or severance from Central Metal Products Division of Barnes Group Inc. (or one or

  

107

  

	
  

	
more predecessors thereof) prior to May 1, 1988 shall be treated as employment with or severance from the Employer.

	
B2

	
Vesting in Participant's Accrued Benefit.

	
  

	
A Central Metal Participant's right to the value of his Accrued Benefit as of December 31, 1987 shall be 100% vested and nonforfeit­able at all times on or after January 1, 1988.

	
  

	
   

  

108

  

BARNES GROUP INC. RETIREMENT SAVINGS PLAN

SUPPLEMENT C

Special Provisions Applicable to Employees Participating in the

 Jet Die & Engineering, Inc. Profit Sharing Plan

PURPOSE

Effective May 1, 1988, Barnes Group Inc. adopted the Barnes Group Inc. Profit Sharing Plan and directed that Jet Die & Engineering, Inc. Profit Sharing Plan (the "Jet Die Plan") be merged into the Barnes Group Inc. Profit Sharing Plan. On May 30, 2003, the Barnes Group Inc. Profit Sharing Plan was merged into the Plan.  This Supplement C sets forth special provisions of the Plan applicable to individuals who were participants of the Jet Die Plan (the "Jet Die Participants") prior to May 1, 1988.

	
C1

	
Service Prior to May 1, 1988.

	
  

	
In determining a Jet Die Participant's Hours of Service, Period of Service and Severance from Service Date, in respect of periods prior to May 1, 1988, employment with or severance from Jet Die & Engineering Division of Barnes Group Inc. (or one or more

  

109

  

	
  

	
predecessors thereof) prior to May 1, 1988 shall be treated as employment with or severance from the Employer.

C2           Vesting.

	
C2.1

	
Prior Vesting Preserved.  A Jet Die Participant's right to the value of his Employer Contribution Account (as defined in the Jet Die Plan) as of December 31, 1987 shall be 100% vested and nonforfeitable at all times on or after December 31, 1987.

	
C2.2

	
Vesting in Participant's Retirement Account.  A Jet Die Participant who was an Employee as of December 31, 1987 shall be 100% vested in his Retirement Account at all times on or after January 1, 1988.

	
  

	
   

  

110

  

BARNES GROUP INC. RETIREMENT SAVINGS PLAN

SUPPLEMENT D

Special Provisions Applicable to the

 Employees of the Flameco Division

PURPOSE

Effective January 1, l990, Barnes Group Inc. directed that employees of its Flameco division be eligible to participate in the Barnes Group Inc. Profit Sharing Plan. On May 30, 2003, the Barnes Group Inc. Profit Sharing Plan was merged into the Plan.  This Supplement D sets forth special provisions of the Plan applicable to individuals who were employees of Flameco Engineering Inc. prior to January 1, 1990.

	
D1

	
Service Prior to January 1, 1990.

	
  

	
In determining a Flameco Participant's Hours of Service, Period of Service and Severance from Service Date, in respect of periods prior to January 1, 1990, employment with or severance from Flameco Engineering Inc. (or one or more predecessors thereof) prior to January 1, 1990 shall be treated as employment with or severance from the Employer.

  

111

  

BARNES GROUP INC.

 

RETIREMENT SAVINGS PLAN

 

AMENDMENT NO. 1

 

 

WHEREAS, Barnes Group Inc. heretofore adopted an amended and restated Barnes Group Inc. Retirement Savings Plan as of July 1, 2009 (the “Plan”); and

 

WHEREAS, Article 13 of the Plan provides that the Plan may be amended from time to time; and

 

WHEREAS, the Company wishes to amend the Plan (i) to provide that, if a participant dies while on military leave and before his or her date of distribution, the participant will be treated as if he or she was reemployed on the date immediately preceding the death and terminated employment on the date of death; (ii) to provide that differential wage payments paid to a participant while on military leave shall be treated as compensation for purposes of calculation of contributions and benefits; and (iii) to eliminate the gap period income requirement with respect to distributions of excess deferrals and corrective distributions for failed nondiscrimination testing; and (iv) to provide that required minimum distributions are not required for 2009, but participants can elect to receive such distributions.

 

NOW THEREFORE, the Plan is hereby amended, effective as the dates specified hereinbelow, as follows:

 

	
1.  

	
Effective January 1, 2009, Section 1.11 of the Plan is amended to add the following new sentence at the end thereof:

 

“Effective January 1, 2009, Compensation shall include any payments made to an Employee in Qualified Military Service while on active duty for a period of more than thirty (30) days that represent all or a portion of the wages the Participant would have received if the Participant were performing services for the Employer.”

 

 

	
2.  

	
Effective for Plan years beginning on or after January 1, 2008, Section 3.9(h) is amended by deleted its first paragraph and replacing it with the following:

 

“Effective for Plan Years beginning prior to January 1, 2008, contributions that are refunded or forfeited under paragraph (g) above or under Section 3.1(d) shall be adjusted for allocable gains or losses for the Plan Year with respect to which the contributions were made (including income or loss for the period between the end of the Plan Year and the date of distribution).  The amount of the allocable gain or loss is the product of (i) multiplied by (ii), where (i) is a ratio, the numerator of which is the Plan Year-to-date gain or

 

  

  

  

loss on the money type being refunded or forfeited and the denominator of such money type at the beginning of the Plan Year, plus contributions of that money type credited for such Plan Year, and (ii) is the amount of the refund or forfeiture of that money type.  Income allocable to the excess amounts for the period between the end of the Plan Year and the date of distribution shall be determined under the method otherwise used for allocating income to Participants’ Accounts and shall be determined on a date that is no more than seven (7) days before the date of distribution.  Effective for Plan Years beginning on or after January 1, 2008, in accordance with the Pension Protection Act of 2006 (“PPA”), any income allocable to contributions that are refunded or forfeited under paragraph (g) above or under Section 3.1(d) for the period between the end of the Plan Year and the date of distribution should be disregarded.  In all events, the income attributable to such excess amounts will be determined in accordance with regulations issued under Code sections 401(k), 401(m) and 402(g), as applicable.”

 

	
3.  

	
Effective January 1, 2009, Section 8.2(b) of the Plan is amended to add the following sentence at the end thereof:

 

“Notwithstanding the provisions of the Plan to the contrary, a Participant or beneficiary who would have been required to receive required minimum distributions for 2009 but for the enactment of Section 401(a)(9)(H) of the Code (“2009 RMDs”), and who would have satisfied that requirement by receiving distributions that are (1) equal to the 2009 RMDs or (2) one or more payments in a series of substantially equal distributions (that include the 2009 RMDs) made at least annually and expected to last for the life (or life expectancy) of the Participant, the joint lives (or joint life expectancy) of the Participant and the Participant’s beneficiary, or for a period of at least 10 years (“Extended 2009 RMDs”), will not receive those distributions for 2009 unless the Participant or beneficiary chooses to receive such distributions. Participants and beneficiaries described in the preceding sentence will be given the opportunity to elect to receive the distributions described in this Section 8.2(b).”

 

	
4.  

	
Effective for deaths occurring on or after January 1, 2007, Article  15 of the Plan is amended to add the following new Section 15.10 at the end thereof:

 

“15.10  DEATH WHILE ON MILITARY LEAVE 

 

Effective for deaths occurring on or after January 1, 2007, if a Participant dies while in Qualified Military Service and before his date of distribution, the Participant will be treated as if he was reemployed by the Employer on the date immediately preceding his death and terminated employment on the date of death.  This section shall not apply for the purposes of determining any contributions under the Plan.”

 

  

2

  

	
5.  

	
All other terms and conditions of the Plan shall remain unaffected by this Amendment.

 

 

IN WITNESS WHEREOF, the Company has caused this Amendment to be executed by its duly authorized officer this 22nd day of December, 2009.

 

	  	
BARNES GROUP INC.

	  	  
	  	
By: /s/ Dawn Edwards

	  	  	
Dawn Edwards

	  	  	
Senior Vice President, Human Resources and Chairperson, Benefits Committee

 

 

 

  

3ex43tos307380_05142010.htm

Exhibit 4.3

 

Form of Indenture

PHARMACYCLICS, INC.

ISSUER

and

[______________________]

INDENTURE TRUSTEE

INDENTURE

Dated as of ________, _____

 

 

  

  

  

 

	
ARTICLE I

	
DEFINITIONS AND INCORPORATION BY REFERENCE

	
1

	 	 	 
	
Section 1.01

	
Definitions.

	
1

	
Section 1.02

	
Other Definitions.

	
5

	
Section 1.03

	
Incorporation by Reference of Trust Indenture Act.

	
5

	
Section 1.04

	
Rules of Construction.

	
6

	 	 	 
	
ARTICLE II

	
THE SECURITIES

	
6

	 	 	 
	
Section 2.01

	
Issuable in Series

	
6

	
Section 2.02

	
Establishment of Terms of Series of Securities

	
6

	
Section 2.03

	
Execution and Authentication

	
8

	
Section 2.04

	
Registrar and Paying Agent

	
9

	
Section 2.05

	
Paying Agent to Hold Money in Trust

	
9

	
Section 2.06

	
Holder Lists

	
10

	
Section 2.07

	
Transfer and Exchange

	
10

	
Section 2.08

	
Mutilated, Destroyed, Lost and Stolen Securities.

	
10

	
Section 2.09

	
Outstanding Securities

	
11

	
Section 2.10

	
Treasury Securities

	
11

	
Section 2.11

	
Temporary Securities

	
11

	
Section 2.12

	
Cancellation

	
12

	
Section 2.13

	
Defaulted Interest

	
12

	
Section 2.14

	
Global Securities

	
12

	
Section 2.15

	
CUSIP Numbers

	
13

	 	 	 
	
ARTICLE III

	
REDEMPTION

	
13

	 	 	 
	
Section 3.01

	
Notice to Trustee

	
13

	
Section 3.02

	
Selection of Securities to be Redeemed

	
14

	
Section 3.03

	
Notice of Redemption.

	
14

	
Section 3.04

	
Effect of Notice of Redemption

	
15

	
Section 3.05

	
Deposit of Redemption Price

	
15

	
Section 3.06

	
Securities Redeemed in Part

	
15

	 	 	 
	
ARTICLE IV

	
COVENANTS

	
15

	 	 	 
	
Section 4.01

	
Payment of Principal and Interest

	
15

	
Section 4.02

	
SEC Reports

	
15

	
Section 4.03

	
Compliance Certificate

	
15

	
Section 4.04

	
Stay, Extension and Usury Laws

	
16

	 	 	 
	
ARTICLE V

	
SUCCESSORS

	
16

	 	 	 
	
Section 5.01

	
When Company May Merge, Etc.

	
16

	
Section 5.02

	
Successor Corporation Substituted

	
16

	 	 	 

 

 

  

  

  

 

	
ARTICLE VI

	
DEFAULTS AND REMEDIES

	
16

	 	 	 
	
Section 6.01

	
Section 6.01 Events of Default

	
16

	
Section 6.02

	
Acceleration of Maturity; Rescission and Annulment

	
18

	
Section 6.03

	
Collection of Indebtedness and Suits for Enforcement by Trustee

	
18

	
Section 6.04

	
Trustee May File Proofs of Claim

	
19

	
Section 6.05

	
Trustee May Enforce Claims Without Possession of Securities

	
19

	
Section 6.06

	
Application of Money Collected

	
20

	
Section 6.07

	
Limitation on Suits

	
20

	
Section 6.08

	
Unconditional Right of Holders to Receive Principal and Interest

	
20

	
Section 6.09

	
Restoration of Rights and Remedies

	
21

	
Section 6.10

	
Rights and Remedies Cumulative

	
21

	
Section 6.11

	
Delay or Omission Not Waiver

	
21

	
Section 6.12

	
Control by Holders

	
21

	
Section 6.13

	
Waiver of Past Defaults

	
21

	
Section 6.14

	
Undertaking for Costs

	
22

	 	 	 
	
ARTICLE VII

	
TRUSTEE

	
22

	 	 	 
	
Section 7.01

	
Duties of Trustee

	
22

	
Section 7.02

	
Rights of Trustee

	
23

	
Section 7.03

	
Individual Rights of Trustee

	
24

	
Section 7.04

	
Trustee’s Disclaimer

	
24

	
Section 7.05

	
Notice of Defaults

	
24

	
Section 7.06

	
Reports by Trustee to Holders

	
25

	
Section 7.07

	
Compensation and Indemnity

	
25

	
Section 7.08

	
Replacement of Trustee

	
25

	
Section 7.09

	
Successor Trustee by Merger, Etc.

	
26

	
Section 7.10

	
Eligibility; Disqualification

	
26

	
Section 7.11

	
Preferential Collection of Claims Against Company

	
26

	 	 	 
	
ARTICLE VIII

	
SATISFACTION AND DISCHARGE; DEFEASANCE

	
27

	 	 	 
	
Section 8.01

	
Satisfaction and Discharge of Indenture

	
27

	
Section 8.02

	
Application of Trust Funds; Indemnification

	
27

	
Section 8.03

	
Legal Defeasance of Securities of any Series

	
28

	
Section 8.04

	
Covenant Defeasance

	
30

	
Section 8.05

	
Repayment to Company

	
31

	
Section 8.06

	
Reinstatement

	
31

	 	 	 
	
ARTICLE IX

	
AMENDMENTS AND WAIVERS

	
31

	 	 	 
	
Section 9.01

	
Without Consent of Holders

	
31

	
Section 9.02

	
With Consent of Holders

	
32

	
Section 9.03

	
Limitations

	
33

	
Section 9.04

	
Compliance with Trust Indenture Act

	
33

	
Section 9.05

	
Revocation and Effect of Consents

	
33

	
Section 9.06

	
Notation on or Exchange of Securities

	
33

	
Section 9.07

	
Trustee Protected

	
34

 

  

ii

  

 

	
ARTICLE X

	
MISCELLANEOUS

	
34

	 	 	 
	
Section 10.01

	
Trust Indenture Act Controls

	
34

	
Section 10.02

	
Notices

	
34

	
Section 10.03

	
Communication by Holders with Other Holders

	
35

	
Section 10.04

	
Certificate and Opinion as to Conditions Precedent

	
35

	
Section 10.05

	
Statements Required in Certificate or Opinion

	
35

	
Section 10.06

	
Rules by Trustee and Agents

	
35

	
Section 10.07

	
Legal Holidays

	
35

	
Section 10.08

	
No Recourse Against Others

	
36

	
Section 10.09

	
Counterparts

	
36

	
Section 10.10

	
Governing Laws

	
36

	
Section 10.11

	
No Adverse Interpretation of Other Agreements

	
36

	
Section 10.12

	
Successors

	
36

	
Section 10.13

	
Severability

	
36

	
Section 10.14

	
Table of Contents, Headings, Etc.

	
36

	
Section 10.15

	
Securities in a Foreign Currency

	
36

	
Section 10.16

	
Judgment Currency

	
37

	 	 	 
	
ARTICLE XI

	
SINKING FUNDS

	
37

	 	 	 
	
Section 11.01

	
Applicability of Article

	
37

	
Section 11.02

	
Satisfaction of Sinking Fund Payments with Securities

	
38

	
Section 11.03

	
Redemption of Securities for Sinking Fund

	
38

 

  

iii

  

 

PHARMACYCLICS, INC.

Reconciliation and tie between Trust Indenture Act of 1939 and

Indenture, dated as of_______, ____

 

	
Section 310

	
(a)(1)

	
7.10

	  	
(a)(2)

	
7.10

	  	
(a)(3)

	
NOT APPLICABLE

	  	
(a)(4)

	
NOT APPLICABLE

	  	
(a)(5)

	
7.10

	  	
(b)

	
7.10

	
Section 311

	
(a)

	
7.11

	  	
(b)

	
7.11

	  	
(c)

	
NOT APPLICABLE

	
Section 312

	
(a)

	
2.06

	  	
(b)

	
10.03

	  	
(c)

	
10.03

	
Section 313

	
(a)

	
7.06

	  	
(b)(1)

	
7.06

	  	
(b)(2)

	
7.06

	  	
(c)(1)

	
7.06

	  	
(d)

	
7.06

	
Section 314

	
(a)

	
4.02, 10.05

	  	
(b)

	
NOT APPLICABLE

	  	
(c)(1)

	
10.04

	  	
(c)(2)

	
10.04

	  	
(c)(3)

	
NOT APPLICABLE

	  	
(d)

	
NOT APPLICABLE

	  	
(e)

	
10.05

	  	
(f)

	
NOT APPLICABLE

	
Section 315

	
(a)

	
7.01

	  	
(b)

	
7.05

	  	
(c)

	
7.01

	  	
(d)

	
7.01

	  	
(e)

	
6.14

	
Section 316

	
(a)

	
2.09

	  	
(a)(1)(a)

	
6.12

	  	
(a)(1)(b)

	
6.13

	  	
(b)

	
6.08

	
Section 317

	
(a)(1)

	
6.03

	  	
(a)(2)

	
6.04

	  	
(b)

	
2.05

	
Section 318

	
(a)

	
10.01

 

  

iv

  

Indenture dated as of _______, ____ between Pharmacyclics, Inc., a Delaware corporation (“Company”), and _______, a _______ corporation, as trustee (“Trustee”).

 

Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Securities issued under this Indenture.

 

ARTICLE I

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01  Definitions.

 

“Additional Amounts” means any additional amounts which are required hereby or by any Security, under circumstances specified herein or therein, to be paid by the Company in respect of certain taxes imposed on Holders specified herein or therein and which are owing to such Holders.

 

“Affiliate” of any specified person means any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person.  For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such person, whether through the ownership of voting securities or by agreement or otherwise.

 

“Agent” means any Registrar, Paying Agent or Service Agent.

 

“Applicable Procedures” means, with respect to any transfer or transaction involving a Global Security or beneficial interest therein, the rules and procedures of DTC or any successor Depositary, in each case to the extent applicable to such transaction and as in effect from time to time.

 

“Authorized Newspaper” means a newspaper in an official language of the country of publication customarily published at least once a day for at least five days in each calendar week and of general circulation in the place in connection with which the term is used.  If it shall be impractical in the opinion of the Trustee to make any publication of any notice required hereby in an Authorized Newspaper, any publication or other notice in lieu thereof that is made or given by the Trustee shall constitute a sufficient publication of such notice.

 

“Bearer” means anyone in possession from time to time of a Bearer Security.

 

“Bearer Security” means any Security, including any interest coupon appertaining thereto, that does not provide for the identification of the Holder thereof.

 

“Board of Directors” means the Board of Directors of the Company or any duly authorized committee thereof.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been adopted by the Board of Directors or pursuant to authorization by the Board of Directors and to be in full force and effect on the date of the certificate and delivered to the Trustee.

 

  

  

  

 

“Business Day” means, unless otherwise provided by Board Resolution, Officers’ Certificate or supplemental indenture hereto for a particular Series, any day except a Saturday, Sunday or a legal holiday in The City of New York on which banking institutions are authorized or required by law, regulation or executive order to close.

 

“Capital Interests” means any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock, including, without limitation, with respect to partnerships, partnership interests (whether general or limited) and any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distributions of assets of, such partnership.

 

“Company” means the party named as such above until a successor replaces it and thereafter means the successor.

 

“Company Order” means a written order signed in the name of the Company by two Officers, one of whom must be the Company’s principal executive officer, principal financial officer or principal accounting officer.

 

“Company Request” means a written request signed in the name of the Company by its Chief Executive Officer, Chief Financial Officer or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee.

 

“Corporate Trust Office” means the office of the Trustee at which at any particular time its corporate trust business shall be principally administered.

 

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

 

“Depository” means, with respect to the Securities of any Series issuable or issued in whole or part in the form of one or more Global Securities, the person designated as Depositary for such Series by the Company, which Depository shall be a clearing agency registered under the Exchange Act; and if at any time there is more than one such person, “Depository” as used with respect to the Securities of any Series shall mean the Depository with respect to the Securities of such Series.

 

“Discount Security” means any Security that provides for an amount less than the stated principal amount thereof to be due and payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.02.

 

“Dollars” and “$” means the currency of The United States of America.

 

“DTC” means the Depository Trust Company, a New York corporation.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

  

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“Foreign Currency” means any currency or currency unit issued by a government other than the government of The United States of America.

 

“Foreign Government Obligations” means, with respect to Securities of any Series that are denominated in a Foreign Currency, (i) direct obligations of the government that issued or caused to be issued such currency for the payment of which obligations its full faith and credit is pledged or (ii) obligations of a person controlled or supervised by or acting as an agency or instrumentality of such government the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by such government, which, in either case under clauses (i) or (ii), are not callable or redeemable at the option of the issuer thereof.

 

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession.

 

“Global Security” or “Global Securities” means a Security or Securities, as the case may be, in the form established pursuant to Section 2.02 evidencing all or part of a Series of Securities, issued to the Depository for such Series or its nominee, and registered in the name of such Depository or nominee.

 

“Holder” means a person in whose name a Security is registered or the holder of a Bearer Security.

 

“Indenture” means this Indenture as amended or supplemented from time to time and shall include the form and terms of particular Series of Securities established as contemplated hereunder.

 

“interest” with respect to any Discount Security which by its terms bears interest only after Maturity means interest payable after Maturity.

 

“Maturity,” when used with respect to any Security or installment of principal thereof, means the date on which the principal of such Security or such installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise.

 

“Officer” means the Chief Executive Officer, Chief Financial Officer, any Vice-President, the Treasurer, the Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.

 

“Officers’ Certificate” means a certificate signed by two Officers, one of whom must be the Company’s principal executive officer, principal financial officer or principal accounting officer.

 

“Opinion of Counsel” means a written opinion of legal counsel who is reasonably acceptable to the Trustee.  The counsel may be an employee of or counsel to the Company.

 

  

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“person” means any individual, corporation, partnership, joint venture, association, limited liability company, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

 

“principal” of a Security means the principal of the Security plus, when appropriate, the premium, if any, on, and any Additional Amounts in respect of, the Security.

 

“Responsible Officer” means any officer of the Trustee in its Corporate Trust Office with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom any corporate trust matter is referred because of his or her knowledge of and familiarity with a particular subject.

 

“SEC” means the Securities and Exchange Commission.

 

“Securities” means the debentures, notes or other debt instruments of the Company of any Series authenticated and delivered under this Indenture.

 

“Series” or “Series of Securities” means each series of debentures, notes or other debt instruments of the Company created pursuant to Sections 2.01 and 2.02 hereof.

 

“Stated Maturity” means when used with respect to any Security or any installment of principal thereof or interest thereon, the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.

 

“Subsidiary” means, with respect to any person, any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Interests entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof or, in the case of a partnership, more than 50% of the partners’ Capital Interests (considering all partners’ Capital Interests as a single class), is at the time owned or controlled, directly or indirectly, by such person or one or more of the other Subsidiaries of such person or combination thereof.

 

“TIA” means the Trust Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb) as in effect on the date of this Indenture and the rules and regulations promulgated thereunder; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, “TIA” means, to the extent required by any such amendment, the Trust Indenture Act as so amended.

 

“Trustee” means the person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean each person who is then a Trustee hereunder, and if at any time there is more than one such person, “Trustee” as used with respect to the Securities of any Series shall mean the Trustee with respect to Securities of that Series.

 

“U.S. Government Obligations” means securities which are (i) direct obligations of The United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a person controlled or supervised by and acting as an agency or instrumentality of The United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by The United States of America, and which are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligation or a specific payment of interest on or principal of any such U.S. Government Obligation held by such custodian for the account of the holder of a depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation evidenced by such depository receipt.

 

  

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Section 1.02  Other Definitions.

 

	
TERM

	
DEFINED

IN SECTION

	
“Bankruptcy Law”

	
6.01

	
“Custodian”

	
6.01

	
“Event of Default”

	
6.01

	
“Judgment Currency”

	
10.16

	
“Legal Holiday”

	
10.07

	
“mandatory sinking fund payment”

	
11.01

	
“Market Exchange Rate”

	
10.15

	
“New York Banking Day”

	
10.16

	
“optional sinking fund payment”

	
11.01

	
“Paying Agent”

	
2.04

	
“Registrar”

	
2.04

	
“Required Currency”

	
10.16

	
“Service Agent”

	
2.04

	
“successor person”

	
5.01

Section 1.03  Incorporation by Reference of Trust Indenture Act.

 

Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture.  The following TIA terms used in this Indenture have the following meanings:

 

“Commission” means the SEC.

 

“indenture securities” means the Securities.

 

“indenture security holder” means a Holder.

 

“indenture to be qualified” means this Indenture.

 

“indenture trustee” or “institutional trustee” means the Trustee.

 

“obligor” on the indenture securities means the Company and any successor obligor upon the Securities.

 

  

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All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA and not otherwise defined herein are used herein as so defined.

 

Section 1.04  Rules of Construction.

 

Unless the context otherwise requires:

 

(a)           a term has the meaning assigned to it;

 

(b)           an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles;

 

(c)           references to “generally accepted accounting principles” and “GAAP” shall mean generally accepted accounting principles in effect as of the time when and for the period as to which such accounting principles are to be applied;

 

(d)           “or” is not exclusive;

 

(e)           words in the singular include the plural, and in the plural include the singular; and

 

(f)           provisions apply to successive events and transactions.

 

ARTICLE II

THE SECURITIES

 

Section 2.01  Issuable in Series.  The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.  The Securities may be issued in one or more Series.  All Securities of a Series shall be identical except as may be set forth or determined in the manner provided in a Board Resolution, supplemental indenture or Officers’ Certificate detailing the adoption of the terms thereof pursuant to authority granted under a Board Resolution.  In the case of Securities of a Series to be issued from time to time, the Board Resolution, Officers’ Certificate or supplemental indenture detailing the adoption of the terms thereof pursuant to authority granted under a Board Resolution may provide for the method by which specified terms (such as interest rate, maturity date, record date or date from which interest shall accrue) are to be determined.  Securities may differ between Series in respect of any matters, provided that all Series of Securities shall be equally and ratably entitled to the benefits of the Indenture.

 

Section 2.02  Establishment of Terms of Series of Securities.  At or prior to the issuance of any Securities within a Series, the following shall be established (as to the Series generally, in the case of Subsection 2.02(a) and either as to such Securities within the Series or as to the Series generally in the case of Subsections 2.02(b) through 2.02(s) by or pursuant to a Board Resolution, and set forth or determined in the manner provided in a Board Resolution, supplemental indenture or an Officers’ Certificate:

 

(a)           the form and title of the Series (which shall distinguish the Securities of that particular Series from the Securities of any other Series);

 

  

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(b)           the price or prices (expressed as a percentage of the principal amount thereof) at which the Securities of the Series will be issued;

 

(c)           any limit upon the aggregate principal amount of the Securities of the Series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the Series pursuant to Section 2.07, 2.08, 2.11, 3.06 or 9.06);

 

(d)           the date or dates on which the principal of the Securities of the Series is payable;

 

(e)           the rate or rates (which may be fixed or variable) per annum or, if applicable, the method used to determine such rate or rates (including, but not limited to, any commodity, commodity index, stock exchange index or financial index) at which the Securities of the Series shall bear interest, if any, the date or dates from which such interest, if any, shall accrue, the date or dates on which such interest, if any, shall commence and be payable and any regular record date for the interest payable on any interest payment date;

 

(f)           the place or places where the principal of and interest, if any, on the Securities of the Series shall be payable, where the Securities of such Series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such Series and this Indenture may be served, and the method of such payment, if by wire transfer, mail or other means;

 

(g)           if applicable, the period or periods within which, the price or prices at which and the terms and conditions upon which the Securities of the Series may be redeemed, in whole or in part, at the option of the Company;

 

(h)           the obligation, if any, of the Company to redeem or purchase the Securities of the Series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the Series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;

 

(i)           the dates, if any, on which and the price or prices at which the Securities of the Series will be repurchased by the Company at the option of the Holders thereof and other detailed terms and provisions of such repurchase obligations;

 

(j)           if other than denominations of $1,000 and any integral multiple thereof, the denominations in which the Securities of the Series shall be issuable;

 

(k)           if other than the principal amount thereof, the portion of the principal amount of the Securities of the Series that shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.02;

 

(l)           the currency of denomination of the Securities of the Series, which may be Dollars or any Foreign Currency, and the agency or organization, if any, responsible for overseeing such composite currency;

 

  

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(m)           the provisions, if any, relating to any security provided for the Securities of the Series;

 

(n)           any addition to or change in the Events of Default which applies to any Securities of the Series and any change in the right of the Trustee or the requisite Holders of such Securities to declare the principal amount thereof due and payable pursuant to Section 6.02;

 

(o)           any addition to or change in the covenants set forth in Articles IV or V which applies to Securities of the Series;

 

(p)           the provisions, if any, relating to conversion of any Securities of such Series, including, if applicable, the securities into which the Securities are convertible, the conversion price, the conversion period, provisions as to whether conversion will be mandatory, at the option of the Holders or at the option of the Company, the events requiring an adjustment of the conversion price and provisions affecting conversion if such Series of Securities are redeemed;

 

(q)           whether the Securities of such Series will be senior debt securities or subordinated debt securities and, if applicable, a description of the subordination terms thereof;

 

(r)           any depositaries, interest rate calculation agents, exchange rate calculation agents or other agents with respect to Securities of such Series if other than those appointed herein; and

 

(s)           any other terms of the Securities of the Series (which may modify or delete any provision of this Indenture insofar as it applies to such Series).

 

All Securities of any one Series need not be issued at the same time and may be issued from time to time, consistent with the terms of this Indenture, if so provided by or pursuant to the Board Resolution, supplemental indenture hereto or Officers’ Certificate referred to above, and, unless otherwise provided in such Board Resolution, a Series may be reopened, without the consent of the Holders, for increases in the aggregate principal amount of such Series and issuances of additional Securities of such Series.

 

Section 2.03  Execution and Authentication.  Two Officers shall sign the Securities for the Company by manual or facsimile signature.  If an Officer whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall nevertheless be valid.  A Security shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.  The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.  The Trustee shall at any time, and from time to time, authenticate Securities for original issue in the principal amount provided in the Board Resolution, supplemental indenture hereto or Officers’ Certificate, upon receipt by the Trustee of a Company Order.  Such Company Order may authorize authentication and delivery pursuant to oral or electronic instructions from the Company or its duly authorized agent or agents, which oral instructions shall be promptly confirmed in writing.  Each Security shall be dated the date of its authentication unless otherwise provided by a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate.  The aggregate principal amount of Securities of any Series outstanding at any time may not exceed any limit upon the maximum principal amount for such Series set forth in the Board Resolution, supplemental indenture hereto or Officers’ Certificate delivered pursuant to Section 2.02, except as provided in Section 2.02 or 2.08.  Prior to the issuance of Securities of any Series, the Trustee shall have received and (subject to Section 7.02) shall be fully protected in relying on: (a) the Board Resolution, supplemental indenture hereto or Officers’ Certificate establishing the form of the Securities of that Series or of Securities within that Series and the terms of the Securities of that Series or of Securities within that Series, (b) an Officers’ Certificate complying with Section 10.04 and (c) an Opinion of Counsel complying with Section 10.04. The Trustee shall have the right to decline to authenticate and deliver any Securities of such Series: (a) if the Trustee, being advised by counsel, determines that such action may not be taken lawfully; or (b) if the Trustee’s by its board of directors or trustees, executive committee or a trust committee of directors and/or vice-presidents shall determine in good faith that such action would expose the Trustee to personal liability to Holders of any then outstanding Series of Securities.  The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities.  An authenticating agent may authenticate Securities whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate of the Company.

 

  

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Section 2.04  Registrar and Paying Agent.  The Company shall maintain, with respect to each Series of Securities, at the place or places specified with respect to such Series pursuant to Section 2.02, an office or agency where Securities of such Series may be presented or surrendered for payment (“Paying Agent”), where Securities of such Series may be surrendered for registration of transfer or exchange (“Registrar”) and where notices and demands to or upon the Company in respect of the Securities of such Series and this Indenture may be served (“Service Agent”). The Registrar shall keep a register with respect to each Series of Securities and to their transfer and exchange.  The Company will give prompt written notice to the Trustee of the name and address, and any change in the name or address, of each Registrar, Paying Agent or Service Agent.  If at any time the Company shall fail to maintain any such required Registrar, Paying Agent or Service Agent or shall fail to furnish the Trustee with the name and address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.  The Company may also from time to time designate one or more co-registrars, additional paying agents or additional service agents and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligations to maintain a Registrar, Paying Agent and Service Agent in each place so specified pursuant to Section 2.02 for Securities of any Series for such purposes.  The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the name or address of any such co-registrar, additional paying agent or additional service agent.  The term “Registrar” includes any co-registrar; the term “Paying Agent” includes any additional paying agent; and the term “Service Agent” includes any additional service agent.  The Company hereby appoints the Trustee the initial Registrar, Paying Agent and Service Agent for each Series unless another Registrar, Paying Agent or Service Agent, as the case may be, is appointed prior to the time Securities of that Series are first issued.

 

Section 2.05  Paying Agent to Hold Money in Trust.  The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust, for the benefit of Holders of any Series of Securities, or the Trustee, all money held by the Paying Agent for the payment of principal of or interest on the Series of Securities, and will notify the Trustee of any default by the Company in making any such payment.  While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee.  The Company at any time may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary of the Company) shall have no further liability for the money.  If the Company or a Subsidiary of the Company acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of Holders of any Series of Securities all money held by it as Paying Agent.

 

  

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Section 2.06  Holder Lists.  The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders of each Series of Securities and shall otherwise comply with TIA Section 312(a).  If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least ten (10) days before each interest payment date and at such other times as the Trustee may request in writing a list, in such form and as of such date as the Trustee may reasonably require, of the names and addresses of Holders of each Series of Securities.

 

Section 2.07  Transfer and Exchange.  Where Securities of a Series are presented to the Registrar or a co-registrar with a request to register a transfer or to exchange them for an equal principal amount of Securities of the same Series, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met.  To permit registrations of transfers and exchanges, the Trustee shall authenticate Securities at the Registrar’s request.  No service charge shall be made for any registration of transfer or exchange (except as otherwise expressly permitted herein), but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer tax or similar governmental charge payable upon exchanges pursuant to Sections 2.11, 3.06 or 9.06).  Neither the Company nor the Registrar shall be required (a) to issue, register the transfer of, or exchange Securities of any Series for the period beginning at the opening of business fifteen days immediately preceding the mailing of a notice of redemption of Securities of that Series selected for redemption and ending at the close of business on the day of such mailing, or (b) to register the transfer of or exchange Securities of any Series selected, called or being called for redemption as a whole or the portion being redeemed of any such Securities selected, called or being called for redemption in part.

 

Section 2.08  Mutilated, Destroyed, Lost and Stolen Securities.

 

(a)           If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and make available for delivery in exchange therefor a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.  If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a protected purchaser, the Company shall execute and upon its request the Trustee shall authenticate and make available for delivery, in lieu of any such destroyed, lost or stolen Security, a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding. In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

 

  

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(b)           Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.  Every new Security of any Series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that Series duly issued hereunder.  The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

 

Section 2.09  Outstanding Securities.  The Securities outstanding at any time are all the Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest on a Global Security effected by the Trustee in accordance with the provisions hereof and those described in this Section as not outstanding.  If a Security is replaced pursuant to Section 2.08, it ceases to be outstanding until the Trustee receives proof satisfactory to it that the replaced Security is held by a protected purchaser.  If the Paying Agent (other than the Company, a Subsidiary of the Company or an Affiliate of the Company) holds on the Maturity of Securities of a Series money sufficient to pay such Securities payable on that date, then on and after that date such Securities of the Series cease to be outstanding and interest on them ceases to accrue.  A Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.  In determining whether the Holders of the requisite principal amount of outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the principal amount of a Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to Section 6.02.

 

Section 2.10  Treasury Securities.  In determining whether the Holders of the required principal amount of Securities of a Series have concurred in any request, demand, authorization, direction, notice, consent or waiver, Securities of a Series owned by the Company shall be disregarded, except that for the purposes of determining whether the Trustee shall be protected in relying on any such request, demand, authorization, direction, notice, consent or waiver, only Securities of a Series that the Trustee knows are so owned shall be so disregarded.

 

Section 2.11  Temporary Securities.  Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities upon a Company Order.  Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities.  Without unreasonable delay, the Company shall prepare and the Trustee upon request shall authenticate definitive Securities of the same Series and date of maturity in exchange for temporary Securities.  Until so exchanged, temporary securities shall have the same rights under this Indenture as the definitive Securities.

 

  

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Section 2.12  Cancellation. The Company at any time may deliver Securities to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment.  The Trustee shall cancel all Securities surrendered for registration of transfer, exchange, payment, replacement or cancellation in accordance with its customary procedures and deliver such canceled Securities to the Company, unless the Company otherwise directs; provided that the Trustee shall not be required to destroy Securities.  The Company may not issue new Securities to replace Securities that it has paid or delivered to the Trustee for cancellation.

 

Section 2.13  Defaulted Interest. If the Company defaults in a payment of interest on a Series of Securities, it shall pay the defaulted interest, plus, to the extent permitted by law, any interest payable on the defaulted interest, to the persons who are Holders of the Series on a subsequent special record date.  The Company shall fix the record date and payment date.  At least ten (10) days before the record date, the Company shall mail to the Trustee and to each Holder of the Series a notice that states the record date, the payment date and the amount of interest to be paid.  The Company may pay defaulted interest in any other lawful manner.

 

Section 2.14  Global Securities.

 

(a)           Terms of Securities.  A Board Resolution, a supplemental indenture hereto or an Officers’ Certificate shall establish whether the Securities of a Series shall be issued in whole or in part in the form of one or more Global Securities and the Depository for such Global Security or Securities.

 

(b)           Transfer and Exchange.  Notwithstanding any provisions to the contrary contained in Section 2.07 of the Indenture and in addition thereto, any Global Security shall be exchangeable pursuant to Section 2.07 of the Indenture for Securities registered in the names of Holders other than the Depository for such Security or its nominee only if (i) such Depository notifies the Company that it is unwilling or unable to continue as Depository for such Global Security or if at any time such Depository ceases to be a clearing agency registered under the Exchange Act, and, in either case, the Company fails to appoint a successor Depository registered as a clearing agency under the Exchange Act within 90 days of such event, (ii) the Company executes and delivers to the Trustee an Officers’ Certificate to the effect that such Global Security shall be so exchangeable or (iii) an Event of Default with respect to the Securities represented by such Global Security shall have happened and be continuing. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Securities registered in such names as the Depository shall direct in writing in an aggregate principal amount equal to the principal amount of the Global Security with like tenor and terms.

 

(c)           Except as provided in this Section 2.14(c), a Global Security may not be transferred except as a whole by the Depository with respect to such Global Security to a nominee of such Depository, by a nominee of such Depository to such Depository or another nominee of such Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.

 

(d)           Legend.  Any Global Security issued hereunder shall bear a legend in substantially the following form:

 

  

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(e)           “This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of the Depository or a nominee of the Depository.  This Security is exchangeable for Securities registered in the name of a person other than the Depository or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.”

 

(f)           Acts of Holders.  The Depository, as a Holder, may appoint agents and otherwise authorize participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a Holder is entitled to give or take under the Indenture.

 

(g)           Payments.  Notwithstanding the other provisions of this Indenture, unless otherwise specified as contemplated by Section 2.02, payment of the principal of and interest, if any, on any Global Security shall be made to the Holder thereof.

 

(h)           Consents, Declaration and Directions.  Except as provided in Section 2.14(g), the Company, the Trustee and any Agent shall treat a person as the Holder of such principal amount of outstanding Securities of such Series represented by a Global Security as shall be specified in a written statement of the Depository with respect to such Global Security, for purposes of obtaining any consents, declarations, waivers or directions required to be given by the Holders pursuant to this Indenture.

 

(i)           The Depository or its nominee, as registered owner of a Global Security, shall be the Holder of such Global Security for all purposes under the Indenture and the Securities, and owners of beneficial interests in a Global Security shall hold such interests pursuant to the Applicable Procedures.  Accordingly, any such owner’s beneficial interest in a Global Security will be shown only on, and the transfer of such interest shall be effected only through, records maintained by the Depositary or its nominee and such owners of beneficial interests in a Global Security will not be considered the owners or holders thereof.

 

Section 2.15  CUSIP Numbers.  The Company in issuing the Securities may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other elements of identification printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee of any change in “CUSIP” numbers of which the Company becomes aware.

 

ARTICLE III

REDEMPTION

 

Section 3.01  Notice to Trustee.  The Company may, with respect to any Series of Securities, reserve the right to redeem and pay the Series of Securities or may covenant to redeem and pay the Series of Securities or any part thereof prior to the Stated Maturity thereof at such time and on such terms as provided for in such Securities.  If a Series of Securities is redeemable and the Company wants or is obligated to redeem prior to the Stated Maturity thereof all or part of the Series of Securities pursuant to the terms of such Securities, it shall notify the Trustee of the redemption date and the principal amount of Series of Securities to be redeemed.

 

  

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Section 3.02  Selection of Securities to be Redeemed.  Unless otherwise indicated for a particular Series by a Board Resolution, a supplemental indenture or an Officers’ Certificate, if less than all the Securities of a Series are to be redeemed, the Trustee shall select the Securities of the Series to be redeemed in any manner that the Trustee deems fair and appropriate.  The Trustee shall make the selection from Securities of the Series outstanding not previously called for redemption.  The Trustee may select for redemption portions of the principal of Securities of the Series that have denominations larger than $1,000.  Securities of the Series and portions of them it selects shall be in amounts of $1,000 or whole multiples of $1,000 or, with respect to Securities of any Series issuable in other denominations pursuant to Section 2.02(j), the minimum principal denomination for each Series and integral multiples thereof.  Provisions of this Indenture that apply to Securities of a Series called for redemption also apply to portions of Securities of that Series called for redemption.

 

Section 3.03  Notice of Redemption.

 

(a)           Unless otherwise indicated for a particular Series by Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, at least 30 days but not more than 60 days before a redemption date, the Company shall mail a notice of redemption by first-class mail to each Holder whose Securities are to be redeemed and, if any Bearer Securities are outstanding, publish on one occasion a notice in an Authorized Newspaper.  The notice shall identify the Securities of the Series to be redeemed and shall state:

 

	
  

	
(i)

	
the redemption date;

 

	
  

	
(ii)

	
the redemption price;

 

	
  

	
(iii)

	
the name and address of the Paying Agent;

 

	
  

	
(iv)

	
that Securities of the Series called for redemption must be surrendered to the Paying Agent to collect the redemption price;

 

	
  

	
(v)

	
that interest on Securities of the Series called for redemption ceases to accrue on and after the redemption date;

 

	
  

	
(vi)

	
the CUSIP number, if any; and

 

	
  

	
(vii)

	
any other information as may be required by the terms of the particular Series or the Securities of a Series being redeemed.

 

At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at its expense.

 

  

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Section 3.04  Effect of Notice of Redemption.  Once notice of redemption is mailed or published as provided in Section 3.03, Securities of a Series called for redemption become due and payable on the redemption date and at the redemption price.  A notice of redemption may not be conditional.  Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price plus accrued interest to the redemption date; provided that installments of interest whose Stated Maturity is on or prior to the redemption date shall be payable to the Holders of such Securities (or one or more predecessor Securities) registered at the close of business on the relevant record date therefor according to their terms and the terms of this Indenture.

 

Section 3.05  Deposit of Redemption Price.  On or before 10:00 a.m., New York City time, on the redemption date, the Company shall deposit with the Paying Agent money sufficient to pay the redemption price of and accrued interest, if any, on all Securities to be redeemed on that date.

 

Section 3.06  Securities Redeemed in Part.  Upon surrender of a Security that is redeemed in part, the Trustee shall authenticate for the Holder a new Security of the same Series and the same maturity equal in principal amount to the unredeemed portion of the Security surrendered.

 

ARTICLE IV

COVENANTS

 

Section 4.01  Payment of Principal and Interest.  The Company covenants and agrees for the benefit of the Holders of each Series of Securities that it will duly and punctually pay the principal of and interest, if any, on the Securities of that Series in accordance with the terms of such Securities and this Indenture.

 

Section 4.02  SEC Reports.  The Company shall, so long as any of the Securities are outstanding, electronically file with the Commission the annual, quarterly and other periodic reports that the Company is required to file (or would be otherwise required to file) with the Commission pursuant to Sections 13 and 15(d) of the Exchange Act.  The Company also shall comply with the other provisions of TIA Section 314(a).  Delivery of any reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on an Officers’ Certificate).

 

Section 4.03  Compliance Certificate.  The Company shall, so long as any of the Securities are outstanding, deliver to the Trustee, within 120 days after the end of each fiscal year of the Company, an Officers’ Certificate stating whether or not to the knowledge of the signers thereof the Company is in default in the performance and observance of any of the terms, provisions and conditions hereof (without regard to any period of grace or requirement of notice provided hereunder), and if a Default or Event of Default shall have occurred, specifying all such Defaults or Events of Default and the nature and status thereof of which they may have knowledge. The Company shall, so long as any of the Securities are outstanding, deliver to the Trustee, within thirty (30) days after becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto.

 

  

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Section 4.04  Stay, Extension and Usury Laws.  The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture or the Securities and the Company (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.

 

ARTICLE V

SUCCESSORS

 

Section 5.01  When Company May Merge, Etc.  The Company shall not consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its properties and assets to, any person (a “successor person”) unless:

 

(a)           the Company is the surviving corporation or the successor person (if other than the Company) is organized and validly existing under the laws of any U.S. domestic jurisdiction and expressly assumes the Company’s obligations on the Securities and under this Indenture; and

 

(b)           immediately after giving effect to the transaction, no Default or Event of Default shall have occurred and be continuing.

 

The Company shall deliver to the Trustee prior to the consummation of the proposed transaction an Officers’ Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and any supplemental indenture comply with this Indenture.

 

Section 5.02  Successor Corporation Substituted.  Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company in accordance with Section 5.01, the successor corporation formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor person has been named as the Company herein; provided, however, that the predecessor Company in the case of a sale, conveyance or other disposition (other than a lease) shall be released from all obligations and covenants under this Indenture and the Securities.

 

ARTICLE VI

DEFAULTS AND REMEDIES

 

Section 6.01  Section 6.01 Events of Default.

 

“Event of Default,” wherever used herein with respect to Securities of any Series, means any one of the following events, unless in the establishing Board Resolution, supplemental indenture or Officers’ Certificate, it is provided that such Series shall not have the benefit of said Event of Default:

 

  

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(a)           default in the payment of any interest on any Security of that Series when it becomes due and payable, and continuance of such default for a period of 30 days (unless the entire amount of such payment is deposited by the Company with the Trustee or with a Paying Agent prior to the expiration of such period of 30 days); or

 

(b)           default in the payment of principal of any Security of that Series at its Maturity; or

 

(c)           default in the performance or breach of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty for which the consequences of nonperformance or breach are addressed elsewhere in this Section 6.01 and other than a covenant or warranty that has been included in this Indenture solely for the benefit of Series of Securities other than that Series), which default continues uncured for a period of 90 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of not less than a majority in principal amount of the outstanding Securities of that Series a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder; or

 

(d)           the Company pursuant to or within the meaning of any Bankruptcy Law:

 

	
  

	
(i)

	
commences a voluntary case or proceeding;

 

	
  

	
(ii)

	
consents to the entry of an order for relief against it in an involuntary case,

 

	
  

	
(iii)

	
consents to the appointment of a Custodian of it or for all or substantially all of its property,

 

	
  

	
(iv)

	
makes a general assignment for the benefit of its creditors, or

 

	
  

	
(v)

	
makes an admission by writing that it is generally unable to pay its debts as the same become due; or

 

(e)           a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

	
  

	
(i)

	
is for relief against the Company in an involuntary case,

 

	
  

	
(ii)

	
appoints a Custodian of the Company or for all or substantially all of its property, or

 

	
  

	
(iii)

	
orders the liquidation of the Company, and the order or decree remains unstayed and in effect for 90 days; or

 

  

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(f)           any other Event of Default provided with respect to Securities of that Series, which is specified in a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, in accordance with Section 2.02(n).

 

The term “Bankruptcy Law” means Title 11 of the U.S. Code or any similar federal or state law for the relief of debtors.  The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

Section 6.02  Acceleration of Maturity; Rescission and Annulment.  If an Event of Default with respect to Securities of any Series at the time outstanding occurs and is continuing (other than an Event of Default referred to in Section 6.1(d) or (e)), then in every such case the Trustee or the Holders of not less than a majority in principal amount of the outstanding Securities of that Series may declare the principal amount (or, if any Securities of that Series are Discount Securities, such portion of the principal amount as may be specified in the terms of such Securities) of and accrued and unpaid interest, if any, on all of the Securities of that Series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) and accrued and unpaid interest, if any, shall become immediately due and payable. If an Event of Default specified in Section 6.1(d) or (e) shall occur, the principal amount (or specified amount) of and accrued and unpaid interest, if any, on all outstanding Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. At any time after such a declaration of acceleration with respect to any Series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the outstanding Securities of that Series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if all Events of Default with respect to Securities of that Series, other than the non-payment of the principal and interest, if any, of Securities of that Series which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.13. No such rescission shall affect any subsequent Default or impair any right consequent thereon.

 

Section 6.03  Collection of Indebtedness and Suits for Enforcement by Trustee.

 

The Company covenants that if:

 

(a)           default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or

 

(b)           default is made in the payment of principal of any Security at the Maturity thereof,

 

then the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and any overdue interest at the rate or rates prescribed therefor in such Securities and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

  

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If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or deemed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

 

If an Event of Default with respect to any Securities of any Series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such Series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

 

Section 6.04  Trustee May File Proofs of Claim.  In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise, (a) to file and prove a claim for the whole amount of principal and interest owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and (b) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same, and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

Section 6.05  Trustee May Enforce Claims Without Possession of Securities.  All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

  

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Section 6.06  Application of Money Collected.

 

Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

 

First: To the payment of all amounts due the Trustee under Section 7.07; and

 

Second: To the payment of the amounts then due and unpaid for principal of and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and interest, respectively; and

 

Third: To the Company.

 

Section 6.07  Limitation on Suits.  No Holder of any Security of any Series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

(a)           such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that Series;

 

(b)           the Holders of at least a majority in principal amount of the outstanding Securities of that Series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

 

(c)           such Holder or Holders have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request;

 

(c)           the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

 

(d)           no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the outstanding Securities of that Series; it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all such Holders.

 

Section 6.08  Unconditional Right of Holders to Receive Principal and Interest.  Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on such Security on the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

 

  

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Section 6.09  Restoration of Rights and Remedies.  If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

Section 6.10  Rights and Remedies Cumulative.  Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in Section 2.08, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not, to the extent permitted by law, prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

Section 6.11  Delay or Omission Not Waiver.  No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 6.12  Control by Holders.  The Holders of a majority in principal amount of the outstanding Securities of any Series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such Series, provided that:

 

(a)           such direction shall not be in conflict with any rule of law or with this Indenture,

 

(b)           the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and

 

(c)           subject to the provisions of Section 6.01, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer of the Trustee, determine that the proceeding so directed would involve the Trustee in personal liability.

 

Section 6.13  Waiver of Past Defaults.  The Holders of not less than a majority in principal amount of the outstanding Securities of any Series may on behalf of the Holders of all the Securities of such Series waive any past Default hereunder with respect to such Series and its consequences, except a Default (i) in the payment of the principal of or interest on any Security of such Series (provided, however, that the Holders of a majority in principal amount of the outstanding Securities of any Series may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration) or (ii) in respect of a covenant or provision hereof which cannot be modified or amended without the consent of the Holder of each outstanding Security of such Series affected. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.

 

  

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Section 6.14  Undertaking for Costs.  All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the outstanding Securities of any Series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of or interest on any Security on or after the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date).

 

ARTICLE VII

TRUSTEE

 

Section 7.01  Duties of Trustee.

 

(a)           If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

 

(b)           Except during the continuance of an Event of Default:

 

	
  

	
(i)

	
The Trustee need perform only those duties that are specifically set forth in this Indenture and no others.

 

	
  

	
(ii)

	
In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon Officers’ Certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Indenture; however, in the case of any such Officers’ Certificates or Opinions of Counsel which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such Officers’ Certificates and Opinions of Counsel to determine whether or not they conform to the requirements of this Indenture.

 

  

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(c)           The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:

 

	
  

	
(i)

	
This paragraph does not limit the effect of paragraph (b) of this Section.

 

	
  

	
(ii)

	
The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts.

 

	
  

	
(iii)

	
The Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it with respect to Securities of any Series in good faith in accordance with the direction of the Holders of a majority in principal amount of the outstanding Securities of such Series relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such Series.

 

(d)           Every provision of this Indenture that in any way relates to the Trustee is subject to paragraph (a), (b) and (c) of this Section.

 

(e)           The Trustee may refuse to perform any duty or exercise any right or power at the request or direction of any Holder unless it receives indemnity satisfactory to it against any loss, liability or expense.

 

(f)           The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

 

(g)           No provision of this Indenture shall require the Trustee to risk its own funds or otherwise incur any financial liability in the performance of any of its duties, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk is not reasonably assured to it.

 

(h)           The Paying Agent, the Registrar and any Service Agent or authenticating agent shall be entitled to the protections, immunities and standard of care as are set forth in paragraphs (a), (b) and (c) of this Section with respect to the Trustee.

 

Section 7.02  Rights of Trustee.

 

(a)           The Trustee may rely on and shall be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or matter stated in the document.

 

(b)           Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate.

 

  

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(c)           The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.  No Depository shall be deemed an agent of the Trustee, and the Trustee shall not be responsible for any act or omission by any Depository.

 

(d)           The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers, provided that the Trustee’s conduct does not constitute negligence or bad faith.

 

(e)           The Trustee may consult with counsel, and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder without negligence and in good faith and in reliance thereon.

 

(f)           The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders of Securities unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

 

(g)           The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit.

 

(h)           The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities generally or the Securities of a particular Series and this Indenture.

 

(i)           The permissive rights of the Trustee enumerated herein shall not be construed as duties.

 

Section 7.03  Individual Rights of Trustee.  The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate of the Company with the same rights it would have if it were not Trustee.  Any Agent may do the same with like rights.  The Trustee is also subject to Sections 7.10 and 7.11.

 

Section 7.04  Trustee’s Disclaimer.  The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement in the Securities other than its authentication.

 

Section 7.05  Notice of Defaults.  If a Default or Event of Default occurs and is continuing with respect to the Securities of any Series and if it is known to a Responsible Officer of the Trustee, the Trustee shall mail to each Holder of the Securities of that Series and, if any Bearer Securities are outstanding, publish on one occasion in an Authorized Newspaper, notice of a Default or Event of Default within 90 days after it occurs or, if later, after a Responsible Officer of the Trustee has knowledge of such Default or Event of Default. Except in the case of a Default or Event of Default in payment of principal of or interest on any Security of any Series, the Trustee may withhold the notice if and so long as its corporate trust committee or a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders of that Series.

 

  

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Section 7.06  Reports by Trustee to Holders.  Within 60 days after May 15 in each year, the Trustee shall transmit by mail to all Holders, as their names and addresses appear on the register kept by the Registrar and, if any Bearer Securities are outstanding, publish in an Authorized Newspaper, a brief report dated as of such May 15, in accordance with, and to the extent required under, TIA Section 313.  A copy of each report at the time of its mailing to Holders of any Series shall be filed with the SEC and each stock exchange on which the Securities of that Series are listed.  The Company shall promptly notify the Trustee when Securities of any Series are listed on any stock exchange.

 

Section 7.07  Compensation and Indemnity.  The Company shall pay to the Trustee from time to time compensation for its services as the Company and the Trustee shall from time to time agree upon in writing.  The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred by it.  Such expenses shall include the reasonable compensation and expenses of the Trustee’s agents and counsel.  The Company shall indemnify each of the Trustee and any predecessor Trustee (including the cost of defending itself) against any loss, liability or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee) incurred by it except as set forth in this Section 7.07 in the performance of its duties under this Indenture as Trustee or Agent.  The Trustee shall notify the Company promptly of any claim for which it may seek indemnity.  The Company shall defend the claim and the Trustee shall cooperate in the defense.  The Trustee may have one separate counsel and the Company shall pay the reasonable fees and expenses of such counsel.  The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.  This indemnification shall apply to officers, directors, employees, shareholders and agents of the Trustee.  The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee or by any officer, director, employee, shareholder or agent of the Trustee through the negligence or bad faith of any such persons.  To secure the Company’s payment obligations in this Section, the Trustee shall have a lien prior to the Securities of any Series on all money or property held or collected by the Trustee, except that held in trust to pay principal of and interest on particular Securities of that Series.  When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(d) or (e) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.  The provisions of this Section shall survive the resignation or removal of the Trustee and the termination of this Indenture.

 

Section 7.08   Replacement of Trustee.  A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section.  The Trustee may resign with respect to the Securities of one or more Series by so notifying the Company at least 30 days prior to the date of the proposed resignation.  The Holders of a majority in principal amount of the Securities of any Series may remove the Trustee with respect to that Series by so notifying the Trustee and the Company.  The Company may remove the Trustee with respect to Securities of one or more Series if:

 

  

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(a)           the Trustee fails to comply with Section 7.10;

 

(b)           the Trustee is adjudged bankrupt or insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

 

(c)           a Custodian or public officer takes charge of the Trustee or its property; or

 

(d)           the Trustee becomes incapable of acting.

 

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee.

 

If a successor Trustee with respect to the Securities of any one or more Series does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least a majority in principal amount of the Securities of the applicable Series may petition any court of competent jurisdiction for the appointment of a successor Trustee.

 

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee subject to the lien provided for in Section 7.07, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee with respect to each Series of Securities for which it is acting as Trustee under this Indenture.  A successor Trustee shall mail a notice of its succession to each Holder of each such Series and, if any Bearer Securities are outstanding, publish such notice on one occasion in an Authorized Newspaper.  Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee with respect to expenses and liabilities incurred by it prior to the date of such replacement.

 

Section 7.09  Successor Trustee by Merger, etc.  If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee.

 

Section 7.10  Eligibility; Disqualification.  This Indenture shall always have a Trustee who satisfies the requirements of TIA Section 310(a)(1), (2) and (5).  The Trustee shall comply with TIA Section 310(b).

 

Section 7.11  Preferential Collection of Claims Against Company.  The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b).  A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated.

 

  

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ARTICLE VIII

SATISFACTION AND DISCHARGE; DEFEASANCE

 

Section 8.01  Satisfaction and Discharge of Indenture.

 

This Indenture shall upon Company Order cease to be of further effect (except as hereinafter provided in this Section 8.01), and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when

 

(a)           any of the following shall have occurred:

 

	
  

	
(i)

	
no Securities have been issued hereunder;

 

	
  

	
(ii)

	
all Securities theretofore authenticated and delivered (other than Securities that have been destroyed, lost or stolen and that have been replaced or paid) have been delivered to the Trustee for cancellation; or

 

	
  

	
(iii)

	
all such Securities not theretofore delivered to the Trustee for cancellation (1) have become due and payable, or (2) will become due and payable at their Stated Maturity within one year, or (3) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company;

 

and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust an amount sufficient for the purpose of paying and discharging the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal and interest to the date of such deposit (in the case of Securities which have become due and payable on or prior to the date of such deposit) or to the Stated Maturity or redemption date, as the case may be;

 

(b)           the Company has paid or caused to be paid all other sums payable hereunder by the Company; and

 

(c)           the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 7.07 and, if money shall have been deposited with the Trustee pursuant to clause (a) of this Section, the provisions of Sections 2.04, 2.05, 2.07, 2.08, 8.01, 8.02 and 8.05 shall survive.

 

Section 8.02  Application of Trust Funds; Indemnification.

 

(a)           Subject to the provisions of Section 8.05, all money deposited with the Trustee pursuant to Section 8.01, all money and U.S. Government Obligations or Foreign Government Obligations deposited with the Trustee pursuant to Section 8.03 or 8.04 and all money received by the Trustee in respect of U.S. Government Obligations or Foreign Government Obligations deposited with the Trustee pursuant to Section 8.03 or 8.04, shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (other than the Company acting as its own Paying Agent) as the Trustee may determine, to the persons entitled thereto, of the principal and interest for whose payment such money has been deposited with or received by the Trustee or analogous payments as contemplated by Sections 8.03 or 8.04.

 

  

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(b)           The Company shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against U.S. Government Obligations or Foreign Government Obligations deposited pursuant to Sections 8.03 or 8.04 or the interest and principal received in respect of such obligations other than any payable by or on behalf of Holders.

 

(c)           The Trustee shall deliver or pay to the Company from time to time upon Company Request any U.S. Government Obligations or Foreign Government Obligations or money held by it as provided in Sections 8.03 or 8.04 which, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to the Trustee, are then in excess of the amount thereof which then would have been required to be deposited for the purpose for which such U.S. Government Obligations or Foreign Government Obligations or money were deposited or received. This provision shall not authorize the sale by the Trustee of any U.S. Government Obligations or Foreign Government Obligations held under this Indenture.

 

Section 8.03  Legal Defeasance of Securities of any Series.  Unless this Section 8.03 is otherwise specified, pursuant to Section 2.02(s), to be inapplicable to Securities of any Series, the Company shall be deemed to have paid and discharged the entire indebtedness on all the outstanding Securities of any Series on the 91st day after the date of the deposit referred to in subparagraph (d) hereof, and the provisions of this Indenture, as it relates to such outstanding Securities of such Series, shall no longer be in effect (and the Trustee, at the expense of the Company, shall, at Company Request, execute proper instruments acknowledging the same), except as to:

 

(a)           the rights of Holders of Securities of such Series to receive, from the trust funds described in subparagraph (d) hereof, (i) payment of the principal of and each installment of principal of and interest on the outstanding Securities of such Series on the Stated Maturity of such principal or installment of principal or interest, and (ii) the benefit of any mandatory sinking fund payments applicable to the Securities of such Series on the day on which such payments are due and payable in accordance with the terms of this Indenture and the Securities of such Series; and

 

(b)           the provisions of Sections 2.04, 2.05, 2.07, 2.08, 8.02, 8.03 and 8.05; and

 

(c)           the rights, powers, trust and immunities of the Trustee hereunder;

 

provided that, the following conditions shall have been satisfied:

 

(d)           with reference to this Section 8.03, the Company shall have deposited or caused to be irrevocably deposited (except as provided in Section 8.02(c)) with the Trustee as trust funds in trust for the purpose of making the following payments, specifically pledged as security for and dedicated solely to the benefit of the Holders of such Securities (i) in the case of Securities of such Series denominated in Dollars, cash in Dollars and/or U.S. Government Obligations, or (ii) in the case of Securities of such Series denominated in a Foreign Currency (other than a composite currency), money and/or Foreign Government Obligations, which through the payment of interest and principal in respect thereof in accordance with their terms, will provide (and without reinvestment and assuming no tax liability will be imposed on such Trustee), not later than one day before the due date of any payment of money, an amount in cash, sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge each installment of principal of and interest, if any, on and any mandatory sinking fund payments in respect of all the Securities of such Series on the dates such installments of interest or principal and such sinking fund payments are due;

 

  

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(e)           such deposit will not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or by which it is bound;

 

(f)           no Default or Event of Default with respect to the Securities of such Series shall have occurred and be continuing on the date of such deposit or during the period ending on the 91st day after such date;

 

(g)           the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel to the effect that (i) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (ii) since the date of execution of this Indenture, there has been a change in the applicable Federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the Securities of such Series will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit, defeasance and discharge and will be subject to Federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such deposit, defeasance and discharge had not occurred;

 

(h)           the Company shall have delivered to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of the Securities of such Series over any other creditors of the Company or with the intent of defeating, hindering, delaying or defrauding any other creditors of the Company;

 

(i)           the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to the defeasance contemplated by this Section have been complied with; and

 

(j)           such defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the Investment Company Act of 1940, as amended, unless such trust shall be registered under such Act or exempt from registration thereunder.

 

  

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Section 8.04  Covenant Defeasance.  Unless this Section 8.04 is otherwise specified, pursuant to Section 2.02(s), to be inapplicable to Securities of any Series, on and after the 91st day after the date of the deposit referred to in subparagraph (a) hereof, the Company may omit to comply with respect to the Securities of any Series with any term, provision or condition set forth under Sections 4.02, 4.03, and 5.01 as well as any additional covenants specified in a supplemental indenture for such Series of Securities or a Board Resolution or an Officers’ Certificate delivered pursuant to Section 2.02 (and the failure to comply with any such covenants shall not constitute a Default or Event of Default with respect to such Series under Section 6.01) and the occurrence of any event specified in a supplemental indenture for such Series of Securities or a Board Resolution or an Officers’ Certificate delivered pursuant to Section 2.02 and designated as an Event of Default shall not constitute a Default or Event of Default hereunder, with respect to the Securities of such Series, provided that the following conditions shall have been satisfied:

 

(a)           with reference to this Section 8.04, the Company has deposited or caused to be irrevocably deposited (except as provided in Section 8.02(c)) with the Trustee as trust funds in trust for the purpose of making the following payments specifically pledged as security for, and dedicated solely to, the benefit of the Holders of such Securities (i) in the case of Securities of such Series denominated in Dollars, cash in Dollars and/or U.S. Government Obligations, or (ii) in the case of Securities of such Series denominated in a Foreign Currency (other than a composite currency), money and/or Foreign Government Obligations, which through the payment of interest and principal in respect thereof in accordance with their terms, will provide (and without reinvestment and assuming no tax liability will be imposed on such Trustee), not later than one day before the due date of any payment of money, an amount in cash, sufficient, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge each installment of principal of and interest, if any, on and any mandatory sinking fund payments in respect of the Securities of such Series on the dates such installments of interest or principal and such sinking fund payments are due;

 

(b)           such deposit will not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or by which it is bound;

 

(c)           no Default or Event of Default with respect to the Securities of such Series shall have occurred and be continuing on the date of such deposit or during the period ending on the 91st day after such date;

 

(d)           the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that Holders of the Securities of such Series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and covenant defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit and covenant defeasance had not occurred;

 

(e)           the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the covenant defeasance contemplated by this Section have been complied with; and

 

  

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(f)           Such defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the Investment Company Act of 1940, as amended, unless such trust shall be registered under such Act or exempt from registration thereunder.

 

Section 8.05  Repayment to Company.  The Trustee and the Paying Agent shall pay to the Company upon written request any money held by them for the payment of principal and interest that remains unclaimed for two years, and after such time, Holders entitled to the money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another person.

 

Section 8.06  Reinstatement.  If the Trustee or the Paying Agent is unable to apply any money deposited with respect to Securities of any series in accordance with Section 8.01 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the obligations of the Company under this Indenture with respect to the Securities of such series and under the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.01 until such time as the Trustee or the Paying Agent is permitted to apply all such money in accordance with Section 8.01; provided, however, that if the Company has made any payment of principal of, premium (if any) or interest on any Additional Amounts with respect to any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money held by the Trustee or the Paying Agent.

 

ARTICLE IX

AMENDMENTS AND WAIVERS

 

Section 9.01  Without Consent of Holders.  The Company and the Trustee may amend or supplement this Indenture or the Securities of one or more Series without the consent of any Holder:

 

(a)           to evidence the succession of another person to the Company under this Indenture and the Securities and the assumption by any such successor person of the obligations of the Company hereunder and under the Securities;

 

(b)           to add or remove covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included for the benefit of such series) or to surrender any right or power herein conferred upon the Company provided such action does not adversely affect the interests of the Company;

 

(c)           to add any additional Events of Default;

 

(d)           to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form;

 

  

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(e)           to add to, change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change or elimination (A) shall neither (i) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (ii) modify the rights of the Holder of any such Security with respect to such provision or (B) shall become effective only when there is no such Security Outstanding;

 

(f)           to establish the forms or terms of the Securities of any series issued pursuant to the terms hereof;

 

(g)           to cure any ambiguity or correct any inconsistency in this Indenture;

 

(h)           to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee;

 

(i)           to qualify this Indenture under the Trust Indenture Act;

 

(j)           to provide for uncertificated securities in addition to certificated securities;

 

(k)           to supplement any provisions of this Indenture necessary to permit or facilitate the defeasance and discharge of any series of Securities, provided that such action does not adversely affect the interests of the Holders of Securities of such series or any other series; and

 

(l)           to comply with the rules or regulations of any securities exchange or automated quotation system on which any of the Securities may be listed or traded.

 

Section 9.02  With Consent of Holders.  The Company and the Trustee may enter into a supplemental indenture with the written consent of the Holders of at least a majority in principal amount of the outstanding Securities of each Series affected by such supplemental indenture (including consents obtained in connection with a tender offer or exchange offer for the Securities of such Series), for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the Holders of each such Series. Except as provided in Section 6.13, the Holders of at least a majority in principal amount of the outstanding Securities of any Series by notice to the Trustee (including consents obtained in connection with a tender offer or exchange offer for the Securities of such Series) may waive compliance by the Company with any provision of this Indenture or the Securities with respect to such Series.  It shall not be necessary for the consent of the Holders of Securities under this Section 9.02 to approve the particular form of any proposed supplemental indenture or waiver, but it shall be sufficient if such consent approves the substance thereof.  After a supplemental indenture or waiver under this section becomes effective, the Company shall mail to the Holders of Securities affected thereby and, if any Bearer Securities affected thereby are outstanding, publish on one occasion in an Authorized Newspaper, a notice briefly describing the supplemental indenture or waiver.  Any failure by the Company to mail or publish such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture or waiver.

 

  

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Section 9.03  Limitations.  Without the consent of each Holder affected, an amendment or waiver may not:

 

(a)           reduce the amount of Securities whose Holders must consent to an amendment, supplement or waiver;

 

(b)           reduce the rate of or extend the time for payment of interest (including default interest) on any Security;

 

(c)           reduce the principal or change the Stated Maturity of any Security or reduce the amount of, or postpone the date fixed for, the payment of any sinking fund or analogous obligation;

 

(d)           reduce the principal amount of Discount Securities payable upon acceleration of the maturity thereof;

 

(e)           waive a Default or Event of Default in the payment of the principal of or interest, if any, on any Security (except a rescission of acceleration of the Securities of any Series by the Holders of at least a majority in principal amount of the outstanding Securities of such Series and a waiver of the payment default that resulted from such acceleration);

 

(f)           make the principal of or interest, if any, on any Security payable in any currency other than that stated in the Security;

 

(g)           make any change in Sections 6.08, 6.13, or 9.03; or

 

(h)           waive a redemption payment with respect to any Security.

 

Section 9.04  Compliance with Trust Indenture Act.  Every amendment to this Indenture or the Securities of one or more Series shall be set forth in a supplemental indenture hereto that complies with the TIA as then in effect.

 

Section 9.05  Revocation and Effect of Consents.  Until an amendment is set forth in a supplemental indenture or a waiver becomes effective, a consent to it by a Holder of a Security is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security.  However, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of a Security if the Trustee receives the notice of revocation before the date of the supplemental indenture or the date the waiver becomes effective.  Any amendment or waiver once effective shall bind every Holder of each Series affected by such amendment or waiver unless it is of the type described in any of clauses (a) through (h) of Section 9.03.  In that case, the amendment or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.

 

Section 9.06  Notation on or Exchange of Securities.  The Trustee may place an appropriate notation about an amendment or waiver on any Security of any Series thereafter authenticated.  The Company in exchange for Securities of that Series may issue and the Trustee shall authenticate upon request new Securities of that Series that reflect the amendment or waiver.

 

  

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Section 9.07  Trustee Protected.  In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, in addition to the documents required by Section 10.04, and (subject to Section 7.01) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture.  The Trustee shall sign all supplemental indentures, except that the Trustee need not sign any supplemental indenture that adversely affects its rights.

 

ARTICLE X

MISCELLANEOUS

 

Section 10.01  Trust Indenture Act Controls.  If any provision of this Indenture limits, qualifies or conflicts with another provision which is required or deemed to be included in this Indenture by the TIA, such required or deemed provision shall control.

 

Section 10.02  Notices.

 

(a)           Any notice or communication by the Company or the Trustee to the other, or by a Holder to the Company or the Trustee, is duly given if in writing and delivered in person or mailed by first-class mail or sent by telecopier transmission addressed as follows:

 

if to the Company:

 

Pharmacyclics, Inc.

995 E. Arques Avenue

Sunnyvale, California 94085-4521

Attention: Chief Executive Officer

Telephone: (408) 774-0330

Facsimile: (408) 774-0340

 

if to the Trustee:

 

[                                ]

 

(b)           The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.  Any notice or communication to a Holder shall be mailed by first-class mail to his address shown on the register kept by the Registrar and, if any Bearer Securities are outstanding, published in an Authorized Newspaper.  Failure to mail a notice or communication to a Holder of any Series or any defect in it shall not affect its sufficiency with respect to other Holders of that or any other Series.  If a notice or communication is mailed or published in the manner provided above, within the time prescribed, it is duly given, whether or not the Holder receives it.  If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.

 

  

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(c)           Any notice or demand that by any provision of this Indenture is required or permitted to be given or served by the Company may, at the Company’s written request received by the Trustee not fewer than five (5) Business Days prior (or such shorter period of time as may be acceptable to the Trustee) to the date on which such notice must be given or served, be given or served by the Trustee in the name of and at the expense of the Company.

 

Section 10.03  Communication by Holders with Other Holders.  Holders of any Series may communicate pursuant to TIA Section 312(b) with other Holders of that Series or any other Series with respect to their rights under this Indenture or the Securities of that Series or all Series.  The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA Section 312(c).

 

Section 10.04  Certificate and Opinion as to Conditions Precedent.  Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee:

 

(a)           an Officers’ Certificate stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

 

(b)           an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

 

Section 10.05  Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA Section 314(e) and shall include:

 

(a)           a statement that the person making such certificate or opinion has read such covenant or condition;

 

(b)           a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(c)           a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(d)           a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with.

 

Section 10.06  Rules by Trustee and Agents.  The Trustee may make reasonable rules for action by or a meeting of Holders of one or more Series.  Any Agent may make reasonable rules and set reasonable requirements for its functions.

 

Section 10.07  Legal Holidays.  Unless otherwise provided by Board Resolution, Officers’ Certificate or supplemental indenture hereto for a particular Series, a “Legal Holiday” is any day that is not a Business Day.  If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.

 

  

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Section 10.08  No Recourse Against Others.  A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  Each Holder by accepting a Security waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.

 

Section 10.09  Counterparts.  This Indenture 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.

 

Section 10.10  Governing Laws.  This Indenture and the Securities will be governed by, and construed in accordance with, the internal laws of the State of New York, without regard to conflict of law principles that would result in the application of any law other than the laws of the State of New York.

 

Section 10.11  No Adverse Interpretation of Other Agreements.  This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary of the Company.  Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

 

Section 10.12  Successors.  All agreements of the Company in this Indenture and the Securities shall bind its successor.  All agreements of the Trustee in this Indenture shall bind its successor.

 

Section 10.13  Severability.  In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 10.14  Table of Contents, Headings, Etc.  The Table of Contents, Cross-Reference Table, and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

 

Section 10.15  Securities in a Foreign Currency.  Unless otherwise specified in a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate delivered pursuant to Section 2.02 of this Indenture with respect to a particular Series of Securities, whenever for purposes of this Indenture any action may be taken by the Holders of a specified percentage in aggregate principal amount of Securities of all Series or all Series affected by a particular action at the time outstanding and, at such time, there are outstanding Securities of any Series which are denominated in a coin or currency other than Dollars, then the principal amount of Securities of such Series which shall be deemed to be outstanding for the purpose of taking such action shall be that amount of Dollars that could be obtained for such amount at the Market Exchange Rate at such time. For purposes of this Section 10.15, “Market Exchange Rate” shall mean the noon Dollar buying rate in New York City for cable transfers of that currency as published by the Federal Reserve Bank of New York.  If such Market Exchange Rate is not available for any reason with respect to such currency, the Trustee shall use, in its sole discretion and without liability on its part, such quotation of the Federal Reserve Bank of New York as of the most recent available date, or quotations from one or more major banks in The City of New York or in the country of issue of the currency in question or such other quotations as the Trustee, upon consultation with the Company, shall deem appropriate.  The provisions of this paragraph shall apply in determining the equivalent principal amount in respect of Securities of a Series denominated in currency other than Dollars in connection with any action taken by Holders of Securities pursuant to the terms of this Indenture.  All decisions and determinations of the Trustee regarding the Market Exchange Rate or any alternative determination provided for in the preceding paragraph shall be in its sole discretion and shall, in the absence of manifest error, to the extent permitted by law, be conclusive for all purposes and irrevocably binding upon the Company and all Holders.

 

  

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Section 10.16  Judgment Currency.  The Company agrees, to the fullest extent that it may effectively do so under applicable law, that (a) if for the purpose of obtaining judgment in any court it is necessary to convert the sum due in respect of the principal of or interest or other amount on the Securities of any Series (the “Required Currency”) into a currency in which a judgment will be rendered (the “Judgment Currency”), the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee could purchase in The City of New York the Required Currency with the Judgment Currency on the day on which final unappealable judgment is entered, unless such day is not a New York Banking Day, then the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee could purchase in The City of New York the Required Currency with the Judgment Currency on the New York Banking Day preceding the day on which final unappealable judgment is entered and (b) its obligations under this Indenture to make payments in the Required Currency (i) shall not be discharged or satisfied by any tender, any recovery pursuant to any judgment (whether or not entered in accordance with subsection (a)), in any currency other than the Required Currency, except to the extent that such tender or recovery shall result in the actual receipt, by the payee, of the full amount of the Required Currency expressed to be payable in respect of such payments, (ii) shall be enforceable as an alternative or additional cause of action for the purpose of recovering in the Required Currency the amount, if any, by which such actual receipt shall fall short of the full amount of the Required Currency so expressed to be payable, and (iii) shall not be affected by judgment being obtained for any other sum due under this Indenture. For purposes of the foregoing, “New York Banking Day” means any day except a Saturday, Sunday or a legal holiday in The City of New York on which banking institutions are authorized or required by law, regulation or executive order to close.

 

ARTICLE XI

SINKING FUNDS

 

Section 11.01  Applicability of Article.  The provisions of this Article shall be applicable to any sinking fund for the retirement of the Securities of a Series, except as otherwise permitted or required by any form of Security of such Series issued pursuant to this Indenture.  The minimum amount of any sinking fund payment provided for by the terms of the Securities of any Series is herein referred to as a “mandatory sinking fund payment” and any other amount provided for by the terms of Securities of such Series is herein referred to as an “optional sinking fund payment.”  If provided for by the terms of Securities of any Series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 11.02.  Each sinking fund payment shall be applied to the redemption of Securities of any Series as provided for by the terms of the Securities of such Series.

 

  

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Section 11.02  Satisfaction of Sinking Fund Payments with Securities.  The Company may, in satisfaction of all or any part of any sinking fund payment with respect to the Securities of any Series to be made pursuant to the terms of such Securities (1) deliver outstanding Securities of such Series to which such sinking fund payment is applicable (other than any of such Securities previously called for mandatory sinking fund redemption) and (2) apply as credit Securities of such Series to which such sinking fund payment is applicable and which have been repurchased by the Company or redeemed either at the election of the Company pursuant to the terms of such Series of Securities (except pursuant to any mandatory sinking fund) or through the application of permitted optional sinking fund payments or other optional redemptions pursuant to the terms of such Securities, provided that such Securities have not been previously so credited. Such Securities shall be received by the Trustee, together with an Officers’ Certificate with respect thereto, not later than 15 days prior to the date on which the Trustee begins the process of selecting Securities for redemption, and shall be credited for such purpose by the Trustee at the price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.  If as a result of the delivery or credit of Securities in lieu of cash payments pursuant to this Section 11.02, the principal amount of Securities of such Series to be redeemed in order to exhaust the aforesaid cash payment shall be less than $100,000, the Trustee need not call Securities of such Series for redemption, except upon receipt of a Company Order that such action be taken, and such cash payment shall be held by the Trustee or a Paying Agent and applied to the next succeeding sinking fund payment, provided, however, that the Trustee or such Paying Agent shall from time to time upon receipt of a Company Order pay over and deliver to the Company any cash payment so being held by the Trustee or such Paying Agent upon delivery by the Company to the Trustee of Securities of that Series purchased by the Company having an unpaid principal amount equal to the cash payment required to be released to the Company.

 

Section 11.03  Redemption of Securities for Sinking Fund.  Not less than 45 days (unless otherwise indicated in the Board Resolution, supplemental indenture or Officers’ Certificate in respect of a particular Series of Securities) prior to each sinking fund payment date for any Series of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing mandatory sinking fund payment for that Series pursuant to the terms of that Series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting of Securities of that Series pursuant to Section 11.02, and the optional amount, if any, to be added in cash to the next ensuing mandatory sinking fund payment, and the Company shall thereupon be obligated to pay the amount therein specified. Not less than 30 days (unless otherwise indicated in the Board Resolution, Officers’ Certificate or supplemental indenture in respect of a particular Series of Securities) before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 3.02 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 3.03.  Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 3.04, 3.05 and 3.06.

 

  

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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed and attested, all as of the day and year first above written.

 

	
PHARMACYCLICS, INC.

	  
	
By:

	  
	
Name:

	  
	
Title:

	  

	  
	  
	
[__________________________________],

	
as Trustee

	  
	  
	
By:

	  
	
Name:

	  
	
Title:

	  

  

39

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