Document:

exv10w2

Exhibit 10.2

SUBORDINATED SECURED TERM NOTE

	 	 	 

	$13,500,000

	 	Mount Airy, North Carolina
	 

	 	November 19, 2010

     FOR VALUE RECEIVED, the undersigned (the “Maker”), promises to pay to the order of Ivy Steel &
Wire, Inc., a Delaware corporation (together with its permitted successors and assigns, the
“Holder”), in lawful money of the United States of America and in immediately available funds, the
principal amount of THIRTEEN MILLION AND FIVE HUNDRED THOUSAND DOLLARS ($13,500,000) (subject to
reduction pursuant to Section 2.4), at the location and to the account specified in or pursuant to
Section 7.4 below, together with interest, upon the terms and conditions set forth below.

Article I

DEFINITIONS AND RELATED MATTERS

     1.1 Definitions. The following terms with initial capital letters have the following
meanings:

          “Affiliate” means, with respect to any Person, (i) any other Person that, directly or
indirectly through one or more intermediaries, controls, or is controlled by, or is under common
control with, such first Person, and (ii) any officer or director of such Person (or any Person
with similar responsibilities). The term “control” means the possession, directly or indirectly,
of the power, whether or not exercised, (i) to vote 10% or more of the securities having voting
power for the election of directors (or Persons performing similar functions) of such Person or
(ii) to direct or cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise, and the terms “controlled” and
“common control” have correlative meanings.

          “Applicable Law” means all applicable provisions of all (i) constitutions, treaties, statutes,
laws, rules, regulations and ordinances of any Governmental Authority, (ii) Governmental Approvals
and (iii) orders, decisions, judgments, awards and decrees of any Governmental Authority (including
common law and principles of public policy).

          “Bankruptcy Code” means Title 11 of the United States Code (11 U.S.C. Section 101 et seq.), as
amended from time to time.

          “Business Day” means any day that is not a Saturday, Sunday or other day on which banks in
Atlanta, Georgia are authorized or obligated to close.

          “Change of Control” means any of the following: (i) any person or group of persons (within
the meaning of the Securities Exchange Act of 1934, as amended) shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended) of 20% or more of the issued and outstanding
shares of capital stock of Insteel Industries, Inc. having the

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right to vote for the election of directors of Insteel Industries, Inc. under ordinary
circumstances, (ii) during any period of twelve consecutive calendar months, individuals who at the
beginning of such period constituted the board of directors of Insteel Industries, Inc. (together
with any new directors whose election by the board of directors of Insteel Industries, Inc. or
whose nomination for election by the stockholders of Insteel Industries, Inc. was approved by a
vote of at least two-thirds of the directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was previously so approved)
cease for any reason other than death or disability to constitute a majority of the directors then
in office, (iii) Insteel Industries, Inc. ceases to directly own and control all of the economic
and voting rights associated with all of the outstanding capital stock of Maker, or (iv) Insteel
Industries, Inc. ceases to own and control all of the economic and voting rights associated with
all of the outstanding capital stock of any of its Subsidiaries other than Maker.

          “Collateral” means, collectively, (i) the real property described on Schedule I hereto, (ii)
all “equipment” and all “fixtures” (in each case, as defined in the Uniform Commercial Code as the
same may, from time to time, be enacted and in effect in the State of Georgia) now or hereafter
located on such real property described on Schedule I hereto, and (iii) all proceeds of the
foregoing in whatever form, whether derived from voluntary or involuntary disposition, all products
of any of such property, and all renewals, replacements, substitutions, additions, accessions,
rents, issues, royalties and profits of, to or from any such property.

          “Contractual Obligation” means, as applied to any Person, any provision of any security issued
by that Person or of any material agreement or other material instrument to which that Person is a
party or by which it or any of the properties owned or leased by it is bound or otherwise subject.

          “Default” means any condition or event that, with the giving of notice or lapse of time or
both, would, unless cured or waived, become an Event of Default.

          “Distribution” means, with respect to any indebtedness, obligation or security, (i) any
payment or distribution by any person or entity of cash, securities or other property, by setoff or
otherwise, on account of such indebtedness, obligation or security, (ii) any redemption, purchase
or other acquisition of such indebtedness, obligation or security by any person or entity or (iii)
the granting of any lien or security interest to or for the benefit of the holders of such
indebtedness, obligation or security in or upon any property of any person or entity.

          “Enforcement Action” means (i) to take from or for the account of the Maker or any guarantor
of the Maker Obligations, by set-off or in any other manner, the whole or any part of any moneys
which may now or hereafter be owing by the Maker or any such guarantor with respect to the Maker
Obligations, (ii) to sue for payment of, or to initiate or participate with others in any suit,
action or proceeding against the Maker or any such guarantor to (a) enforce payment of or to
collect the whole or any part of the Maker Obligations or (b) commence judicial enforcement of any
of the rights and remedies under this Term Note and all other agreements, documents and instruments
executed from time to time in connection herewith, or applicable law with respect to the Maker
Obligations, (iii) to accelerate the Maker Obligations, (iv) to exercise any put option or to cause
the Maker or any such guarantor to honor any redemption or mandatory prepayment obligation under
this Term Note and all other agreements, documents and

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instruments executed from time to time in connection herewith, or (v) to take any action under
the provisions of any state or federal law, including, without limitation, the Uniform Commercial
Code, or under any contract or agreement, to enforce, foreclose upon, take possession of or sell
any property or assets of the Maker or any such guarantor, including the Collateral..

          “GAAP” means generally accepted accounting principles as in effect in the United States of
America from time to time.

          “Governmental Approval” means an authorization, consent, approval, permit or license issued
by, or a registration or filing with, any Governmental Authority.

          “Governmental Authority” means any nation and any state or political subdivision thereof and
any entity exercising executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government and any tribunal or arbitrator of competent jurisdiction.

          “Lien” means any lien, mortgage, pledge, security interest, charge, or encumbrance of any kind
(including any conditional sale or other title retention agreement or any lease in the nature
thereof) and any agreement to give or refrain from giving any lien, mortgage, pledge, security
interest, charge, or other encumbrance of any kind.

          “Maker Obligations” means any and all indebtedness, liabilities and obligations owing to
Holder at any time (whether such amounts represent obligations which are due or not due, direct or
indirect, absolute or contingent) pursuant to the terms of this Term Note.

          “Maker Parties” means, collectively, the Maker and its Subsidiaries.

          “Material,” “Material Adverse Effect” or “Material Adverse Change” means (i) a condition or
event material to, (ii) a material adverse effect on or (iii) a material adverse change in, as the
case may be, any one or more of the following: (a) the business, assets, results of operations,
condition (financial or otherwise) or prospects of the Maker Parties taken as a whole or (b) the
ability of the Maker to perform its obligations hereunder or (c) the validity, legality or
enforceability of this Term Note, any material provision therein, or the rights or remedies of the
Holder hereunder. “Materially” has a correlative meaning.

          “Permitted Encumbrances” means the following encumbrances: (i) Liens for taxes or assessments
or other governmental charges not yet due and payable or which are being contested in good faith by
appropriate proceedings; (b) pledges or deposits of money securing statutory obligations under
workmen’s compensation, unemployment insurance, social security or public liability laws or similar
legislation; (c) workers’, mechanics’, repairmen’s, carriers’, warehousemen’s, suppliers or similar
Liens arising in the ordinary course of business; or (d) zoning restrictions, easements, licenses
or other restrictions on the use of any real estate or other minor defects or irregularities in
title (including leasehold title) thereto, so long as the same do not materially impair the
ordinary conduct of the business of the Maker or the use of such real estate.

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          “Permitted Maker Payments” means payments due and payable on a non-accelerated basis in
accordance with the terms of Sections 2.1(a) and 2.2(a) of this Term Note.

          “Person” means an individual, a corporation, a partnership, a limited liability company, a
trust, an unincorporated organization or any other entity or organization, including a government
or any agency or political subdivision thereof.

          “Revolving Credit Agreement” means that certain Second Amended and Restated Credit Agreement,
dated as of June 2, 2010, among Maker, as borrower, Insteel Industries, Inc. and Intercontinental
Metals Corporation, a wholly-owned subsidiary of Insteel Industries, Inc., as credit parties and
guarantors, General Electric Capital Corporation, as agent and lender, and the lenders who may
become signatories from time to time, as such agreement may be amended, amended and restated,
refinanced, replaced, supplemented or otherwise modified from time to time.

          “Senior Default” means any “Event of Default” under any or all documentation relating to any
or all of the Senior Obligations, or any condition or event that, after notice or lapse of time or
both, would constitute such an Event of Default if that condition or event were not cured or
removed within any applicable grace or cure period set forth therein.

          “Senior Obligations” means any and all indebtedness, liabilities and obligations, whether now
existing or hereafter arising, of the Maker (i) for borrowed money, (ii) for, under or with respect
to guarantees of obligations for borrowed money, (iii) arising under, or with respect or pursuant
to, any or all documentation relating to any or all of the obligations described in (i) and/or (ii)
above, in each case, from time to time owed to General Electric Capital Corporation (or its
successors or assigns), as agent for various lenders, and such lenders under the Revolving Credit
Agreement and under all other agreements, documents and instruments executed from time to time in
connection with the Revolving Credit Agreement or in replacement or substitution thereof; together
with, in each case, all accrued and unpaid interest and all fees, costs and expenses, whether
primary, secondary, direct, contingent, fixed or otherwise, heretofore, now and from time to time
hereafter owing, due or payable, whether before or after the filing of a proceeding under the
Bankruptcy Code, without regard to whether or not such interest is an allowed claim.

          “Subsidiary” means, with respect to any Person, any other Person of which more than 50% of the
total voting power of the capital stock entitled to vote in the election of the board of directors
(or other Persons performing similar functions) are at the time directly or indirectly owned by
such first Person. Unless otherwise indicated, “Subsidiary” refers to a Subsidiary of the Maker.

          “Taxes” means any present or future income, stamp and other taxes, charges, fees, levies,
duties, imposts, withholdings or other assessments, together with any interest and penalties,
additions to tax and additional amounts imposed by any federal, state, local or foreign taxing
authority upon any Person.

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     1.2 Related Matters.

          (a) Construction. Unless the context of this Term Note clearly requires otherwise,
“including” is not limiting. References in this Term Note to any law (or any part
thereof) include any rules and regulations promulgated thereunder (or with respect to such
part) by the relevant Governmental Authority, as amended from time to time.

          (b) Accounting Terms and Determinations. Unless otherwise specified herein (and whether or
not expressly stated), all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to be delivered
hereunder shall be prepared in accordance with GAAP.

Article II

PAYMENTS ON THIS TERM NOTE

     2.1 Interest

          (a) Interest Rate and Payment. This Term Note shall bear interest on the unpaid principal
balance until payment in full at a fixed rate equal to 6.00% per annum. Accrued interest shall be
due and payable semi-annually in arrears on each April 19 and November 19, until November 19, 2015.
Additionally, in the event of any repayment or prepayment of any principal amount under this Term
Note, accrued interest on the principal amount repaid or prepaid shall be payable on the date of
such repayment or prepayment. Any amount of principal of or interest on this Term Note that is not
paid when due, whether at stated maturity or otherwise, shall bear interest at the rate per annum
otherwise applicable hereunder plus 2%.

          (b) Computations. Interest on this Term Note and the amounts payable hereunder shall be
computed on the basis of a 365- or 366-day year and the actual number of days elapsed (including
the first and excluding the last day of the period).

          (c) Maximum Lawful Rate of Interest. The rate of interest payable on this Term Note shall in
no event exceed the maximum rate permissible under Applicable Law. If the rate of interest payable
is ever reduced as a result of this Section and at any time thereafter the maximum rate permitted
by Applicable Law shall exceed the rate of interest provided for in this Term Note, then the rate
provided for in this Term Note shall be increased to the maximum rate provided by Applicable Law
for such period as is required so that the total amount of interest received by the Holder is that
which would have been received by the Holder but for the operation of the first sentence of this
Section.

     2.2 Repayments and Prepayments of Principal.

     (a) Repayment.

     (i) The Maker shall make the following payments of the unpaid principal amount on the
following dates (each a “Payment Date”):

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	Payment Date	 	Amount
	November 19, 2011
	 	   $675,000
	November 19, 2012
	 	   $675,000
	November 19, 2013
	 	   $675,000
	November 19, 2014
	 	$5,737,500
	November 19, 2015
	 	$5,737,500

     (ii) This Term Note in any event shall be payable in full on November 19, 2015 (the
“Maturity Date”). Any principal amount of this Term Note prepaid or repaid may not be
reborrowed.

     (b) Optional Prepayments.

     (i) The Maker may, at its option, at any time or from time to time, prepay this Term
Note in whole or in part, without premium or penalty upon not less than three Business Days’
prior notice. Any notice of optional prepayment shall be irrevocable, and the payment
amount specified in such notice shall be due and payable on the date specified in such
notice, together with interest accrued thereon to such date.

     (ii) Any voluntary prepayment shall reduce the installments of principal of this Term
Note payable on each Payment Date in inverse order of maturity thereof.

          (c) Substitution of Collateral. If (A) any portion of the Collateral shall be sold, assigned,
leased, conveyed, transferred or otherwise disposed of by the Maker, or if (B) there occurs a
condemnation, seizure or taking in whole of any of the real properties included in the Collateral,
by exercise of the power of eminent domain or otherwise, of such Collateral, or confiscation of any
of the real properties included in the Collateral in whole, then the Maker and Holder shall within
ninety (90) days of such event agree upon substitute collateral with a value reasonably equivalent
to the Collateral sold, assigned, leased, conveyed, seized, taken transferred or otherwise disposed
of by Maker and Maker shall thereafter promptly grant to Holder a first priority security interest
in and lien upon such substitute collateral upon substantially the same terms as provided in the
Collateral Documents.

          (d) Payments Set Aside. To the extent the Holder receives payment of any amount under this
Term Note, whether by way of payment by the Maker, setoff, or otherwise, which payment is
subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, other law or equitable
cause, in whole or in part, then, to the extent of such payment received, this Term Note or the
part hereof intended to be satisfied thereby shall be revived and continue in full force and
effect, as if such payment had not been received by the Holder.

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     2.3 Manner of Payment

          (a) The Maker shall make each payment under this Term Note to the Holder without any deduction
whatsoever, including any deduction for any setoff, recoupment, counterclaim or Taxes, except for
the setoff provided for pursuant to Section 2.4, not later than 10:00 a.m. (New York time) on the
due date thereof.

          (b) Whenever any payment to be made hereunder shall be due on a day that is not a Business
Day, such payment shall instead be made on the next succeeding Business Day, together with interest
accrued during the period of such extension.

     2.4 Reduction of Note. This Term Note is delivered pursuant to that certain Asset
Purchase Agreement of even date between Holder, Maker and Oldcastle Building Products, Inc. (the
“Asset Purchase Agreement”). Pursuant to Section 5.9 of the Asset Purchase Agreement upon the
occurrence of certain events, the Purchase Price (as defined in the Asset Purchase Agreement) and
the principal amount evidenced by this Term Note shall be reduced by $5,000,000 and the payments to
be made under section 2.2(a)(i) shall be as follows: (1) November 19, 2011, $425,000; (2) November
19, 2012, $425,000; (3) November 19, 2013, $425,000; (4) November 19, 2014, $3,612,500; (5)
November 19, 2015, $3,612,500.

     2.5
Security. This Term Note will, from and after the effective date of the
Collateral Documents, be secured by the Collateral, subject to the terms and conditions of the
Collateral Documents.

Article III

REPRESENTATIONS AND WARRANTIES

     The Maker represents and warrants to the Holder as follows:

     3.1 Organization, Powers and Good Standing. The Maker is a corporation duly
organized, validly existing and in good standing under the laws of North Carolina, and has all
necessary corporate power and authority to own, lease and operate its properties and to carry on
its business as it is now being conducted. The Maker is duly qualified or licensed to do business
and in good standing in each jurisdiction where the conduct of its business makes such
qualification or licensing necessary, except any jurisdictions where any failure to be so
qualified, individually or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

     3.2 Authorization, Binding Effect, No Conflict Etc.

          (a) The execution and delivery of, and performance by the Maker of its obligations under, this
Term Note have been duly authorized by all necessary corporate action on the part of the Maker.
This Term Note has been duly executed and delivered by the Maker and is the legal, valid and
binding obligation of the Maker, enforceable against it in accordance with its terms, except as
enforcement may be limited by equitable principles and by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to creditors’ rights generally.

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          (b) The execution and delivery of, and performance by the Maker of its obligations under, this
Term Note, and the consummation of the transactions contemplated hereby, do not and will not (i)
violate any provision of the article of incorporation or bylaws of the Maker, (ii) except for
consents that have been obtained and are in full force and effect, conflict with, result in a
breach of, or constitute (or, with the giving of notice or lapse of time or both, would constitute)
a default under, or require the approval or consent of any Person pursuant to, any Contractual
Obligation of the Maker, or violate any Applicable Law binding on the Maker, except where such
violation, conflict, breach, or default could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect and would not subject the Holder to any liability, or
(iii) result in the creation or imposition of any Lien upon any asset of the Maker, or any income
or profits therefrom.

          (c) No Governmental Approval is or will be required in connection with the execution and
delivery of, and performance by the Maker of its obligations under, this Term Note, or the
transactions contemplated hereby or to ensure the legality, validity or enforceability hereof.

Article IV

AFFIRMATIVE COVENANTS OF THE MAKER

     So long as any amount remains outstanding under this Term Note:

     4.1 Corporate Existence, Etc. The Maker shall, and shall cause each of its Subsidiaries
to, at all times preserve and keep in full force and effect its corporate existence and all
material rights, franchises and other Governmental Approvals, provided, however, that: (a) the
corporate existence of any Subsidiary may be terminated, and any such Governmental Approval may be
terminated or not renewed, if such termination or nonrenewal, as the case may be, is determined by
the Board of Directors of the Maker to be in the best interest of the Maker and is not
disadvantageous in any material respect to the Holder; and (b) the Maker or any Subsidiary may fail
to keep in full force and effect its corporate existence or any material rights, franchises or
other Governmental Approvals so long as such failure, individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect.

     4.2 Security Interest. Within 30 days of the date hereof, the Maker shall grant the
Holder, as security for the prompt payment and performance in full when due of its obligations
hereunder, a perfected, first priority security interest in all of its right, title and interest
in, to and under the Collateral, whether now owned or hereafter acquired by the Maker, all pursuant
to a documentation reasonably satisfactory in form and substance to the Holder and the Maker (which
in any event shall include a recorded mortgage for each parcel of real property and a security
agreement and UCC-1 for all personal property included in the Collateral (the “Collateral
Documents”). It is understood and agreed that Maker shall bear the costs of recording the
mortgages and obtaining mortgagee title insurance for the real properties included in the
Collateral. The Maker shall not, directly or indirectly, make, create, incur, assume or suffer to
exist any Lien securing indebtedness for borrowed money upon or with respect to any

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part of the Collateral, whether now owned or hereafter acquired, other than Liens in favor of the
Holder pursuant to the Collateral Documents.

Article V

[Intentionally Deleted]

Article VI

EVENTS OF DEFAULT

     6.1 Events of Default. The occurrence of any one or more of the following events,
acts or occurrences shall constitute an event of default (each an “Event of Default”):

          (a) Failure to Make Payments. The Maker (i) shall fail to pay as and when due (whether at
stated maturity, upon acceleration, upon required prepayment or otherwise) any principal of this
Term Note which failure continues for a period of five Business Days after Maker receives written
notice of such failure from Holder, or (ii) shall fail to pay any interest or other amounts payable
under this Term Note, or any other Maker Obligations, which failure continues for a period of five
Business Days after Maker receives written notice of such failure from Holder; or

          (b) [Intentionally Deleted]

          (c) [Intentionally Deleted]

          (d) Other Defaults. The Maker shall fail to perform, comply with or observe any
agreement, covenant or obligation under any provision of this Term Note (other than those
provisions referred to in Sections 6.01(a)) or of any Collateral Document, and such failure shall
not have been remedied within 30 days after written notice of such failure is provided to an
executive officer of the Maker or such longer period as is reasonably necessary to cure such
failure so long as Maker is diligently pursuing the cure of such failure; or

          (e) Breach of Warranty. Any representation or warranty or certification made or furnished by
the Maker under Article III of this Term Note, or under any Collateral Document, shall prove to
have been false or incorrect in any material respect when made; or

          (f) Involuntary Bankruptcy; Appointment of Receiver, Etc. There shall be commenced against
any Maker Party, an involuntary case seeking the liquidation or reorganization of such Maker Party
under Chapter 7 or Chapter 11, respectively, of the Bankruptcy Code or any similar proceeding
under any other Applicable Law or an involuntary case or proceeding seeking the appointment of a
receiver, liquidator, sequestrator, custodian, trustee or other officer having similar powers of
any Maker Party or to take possession of all or a substantial portion of its property or to operate
all or a substantial portion of its business, and any of the following events occur: (i) such
Maker Party consents to the institution of such

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involuntary case or proceeding, (ii) the petition commencing the involuntary case or proceeding
is not timely controverted, (iii) the petition commencing such involuntary case or proceeding
remains undismissed and unstayed for a period of 60 days, or (iv) an order for relief shall have
been issued or entered therein; or

          (g) Voluntary Bankruptcy; Appointment of Receiver, Etc. Any Maker Party shall institute a
voluntary case seeking liquidation or reorganization under Chapter 7 or Chapter 11, respectively,
of the Bankruptcy Code or any similar proceeding under any other Applicable Law, or shall consent
thereto; or shall consent to the conversion of an involuntary case to a voluntary case; or shall
file a petition, answer a complaint or otherwise institute any proceeding seeking, or shall consent
to or acquiesce in the appointment of, a receiver, liquidator, sequestrator, custodian, trustee or
other officer with similar powers of it or to take possession of all or a substantial portion of
its property or to operate all or a substantial portion of its business; or shall make a general
assignment for the benefit of creditors; or shall generally not pay its debts as they become due;
or the Board of Directors of such Maker Party (or any committee thereof) adopts any resolution or
otherwise authorizes action to approve any of the foregoing; or

          (h) Change of Control. A Change of Control shall occur at any time; or

          (i) [Intentionally Deleted]

          (j) Invalidity. Any material provision of this Term Note or any Collateral Document for any
reason ceases to be valid, binding and enforceable in accordance with its terms (or any Maker Party
shall challenge the enforceability of this Term Note or any Collateral Document or shall assert in
writing, or engage in any action or inaction based on any such assertion, that any provision of
this Term Note or any Collateral Document has ceased to be or otherwise is not valid, binding and
enforceable in accordance with its terms).

     6.2 Remedies. Upon the occurrence of an Event of Default:

          (a) If an Event of Default occurs under Section 6.01(f) or 6.01(g), then the unpaid principal
amount of this Term Note and all other obligations of the Maker hereunder, and all other Maker
Obligations, shall automatically become immediately due and payable, without presentment, demand,
protest, notice or other requirements of any kind, all of which are hereby expressly waived by the
Maker.

          (b) If an Event of Default occurs, other than under Section 6.01(f) or 6.01(g), the Holder
may, by written notice to the Maker, declare the unpaid principal amount of this Term Note and all
other obligations of the Maker hereunder, and all other Maker Obligations, to be, and the same
shall thereupon become, due and payable, without presentment, demand, protest, any additional
notice or other requirements of any kind, all of which are hereby expressly waived by the Maker.

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Article VII

MISCELLANEOUS

     7.1 Expenses. The Maker shall pay promptly after demand any and all reasonable costs and
expenses (including reasonable fees and disbursements of in-house and other attorneys, appraisers
and consultants) incurred by the Holder in any amendment, workout, restructuring or similar
arrangements or, after a Default, in connection with the protection, preservation, exercise or
enforcement of any of the terms of this Term Note or in connection with any foreclosure, collection
or bankruptcy proceedings.

     7.2 Waivers; Amendments in Writing. No amendment of any provision of this Term Note
(including a waiver thereof or consent relating thereto) shall be effective unless the same shall
be in writing and signed or consented to by the Holder. Any waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given. No notice to or demand
on the Maker in any case shall entitle the Maker to any other or further notice or demand in
similar or other circumstances.

     7.3 Cumulative Remedies; Failure or Delay. The rights and remedies provided for under
this Term Note are cumulative and are not exclusive of any rights and remedies that may be
available to the Holder under Applicable Law or otherwise. No failure or delay on the part of the
Holder in the exercise of any power, right or remedy under this Term Note shall impair such power,
right or remedy or operate as a waiver thereof, nor shall any single or partial exercise of any
such power, right or remedy preclude other or further exercise thereof or of any other power, right
or remedy.

     7.4 Notices, Etc. All notices and other communications under this Term Note shall be in
writing and shall be personally delivered or sent by prepaid courier, by overnight, registered or
certified mail (postage prepaid), or by prepaid telex or telecopy, and shall be deemed given when
received by the intended recipient thereof. Unless otherwise specified in a notice sent or
delivered in accordance with this Section 7.04, all notices and other communications shall be given
to the parties hereto as follows:

If to Maker, to it at:

Insteel Wire Products Company

1373 Boggs Drive

Mount Airy, NC 27030

Fax: 336-786-2144

Phone: 336-786-2141

Attention: James Petelle

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If to Holder, to it at:

Oldcastle, Inc.

375 Northridge Road

Suite 350

Atlanta, GA 30350

Fax: 770-677-2370

Phone: 770- 677-2325

Attention: Michael O’Driscoll, Chief Financial Officer

     7.5 Successors and Assigns. This Term Note shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and transferees. The Maker may not assign or
transfer any interest hereunder without the prior written consent of the Holder. The Holder may
assign all or any part of this Term Note without the consent of the Maker.

     7.6 Governing Law. THIS TERM NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND THIS TERM
NOTE AND ALL CLAIMS AND CAUSES OF ACTION ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY SHALL
BE GOVERNED BY, THE LAWS OF THE STATE OF GEORGIA (OTHER THAN CHOICE OF LAW RULES THAT WOULD REQUIRE
THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION).

     7.7 Choice of Forum. Each of the Maker and (by acceptance hereof) Holder irrevocably
agrees that any legal action or proceeding arising out of or relating to this Term Note brought by
the other party or its successors or assigns shall be brought and determined in any Georgia State
or federal court sitting in Fulton County in Atlanta, Georgia (or, if such court lacks subject
matter jurisdiction, in any appropriate Georgia State or federal court), and each of the parties
hereby irrevocably submits to the exclusive jurisdiction of the aforesaid courts for itself and
with respect to its property, generally and unconditionally, with regard to any such action nor
proceeding arising out of or relating to this Term Note. Each of the parties agrees not to
commence any action, suit or proceeding relating thereto except in the courts described above in
Georgia, other than actions in any court of competent jurisdiction to enforce any judgment, decree
or award rendered by any such court in Georgia as described herein. Each of the parties further
agrees that notice as provided herein shall constitute sufficient service of process and the
parties further waive any argument that such service is insufficient. Each of the parties hereby
irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense,
counterclaim or otherwise, in any action or proceeding arising out of or relating to this Term
Note, (i) any claim that it is not personally subject to the jurisdiction of the courts in Georgia
as described herein for any reason, (ii) that it or its property is exempt or immune from
jurisdiction of any such court or from any legal process commenced in such courts (whether through
service of notice, attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (iii) that (a) the suit, action or proceeding in any such
court is brought in an inconvenient forum; (b) the venue of such suit, action or proceeding is
improper; or (iv) this Term Note may not enforced in or by such courts. Nothing contained in this
Section shall preclude the Holder from bringing any action or proceeding

Term Note

12

 

arising out of or relating to this Term Note in the courts of any place where the Maker or any
of its assets may be found or located.

     7.8 Setoff. The Holder shall have no right, other than by operation of Section 2.4, to
setoff any obligations of the Maker to Holder or any of its Affiliates, whether arising under the
transactions contemplated by this Term Note or otherwise, against any obligations of the Holder or
any of its Affiliates to Maker, whether arising under the transactions contemplated by this Term
Note or otherwise.

     7.9 Complete Agreement. This Term Note is intended by Maker as a final expression of its
agreement regarding the subject matter hereof and contains a complete and exclusive statement of
the terms and conditions of such agreement.

     7.10 Headings. The Article and Section headings used in this Term Note are for convenience
of reference only and shall not affect the construction hereof.

     7.11 Severability. If any provision of this Term Note shall be held to be invalid, illegal
or unenforceable under Applicable Law in any jurisdiction, such provision shall be ineffective only
to the extent of such invalidity, illegality or unenforceability, which shall not affect any other
provisions hereof or the validity, legality or enforceability of such provision in any other
jurisdiction.

     7.12 Limitation of Liability, Etc; Certain Waivers. No claim shall be made by any Maker
Party against the Holder or the Affiliates, directors, officers, employees or agents of the Holder
for any special, indirect, consequential or punitive damages in respect of any claim for breach of
contract or under any other theory of liability arising out of or related to the transactions
contemplated by this Term Note, or any act, omission or event occurring in connection therewith;
and the Maker, on behalf of itself and its Subsidiaries, waives, releases and agrees not to sue
upon any claim for any such damages, whether or not accrued and whether or not known or suspected
to exist in its favor. Maker expressly waives any presentment, demand, protest, notice of dishonor
or any other notice of any kind in connection with this Term Note now or hereafter required by
Applicable Law.

     7.13 WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE MAKER AND THE
HOLDER (BY ACCEPTANCE HEREOF) WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY ACTION UNDER THIS TERM NOTE
OR ANY ACTION ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY, REGARDLESS OF WHICH PARTY
INITIATES SUCH ACTION OR ACTIONS.

Term Note

13

 

Article VIII

SUBORDINATION

     8.1 Payment Subordination. Notwithstanding anything to the contrary contained in this
Term Note:

          (a) the payment of all Maker Obligations shall be subordinate and subject in right and time of
payment, to the extent and in the manner hereinafter set forth, to the prior indefeasible payment
in full in cash of the Senior Obligations;

          (b) the Maker hereby agrees that it may not make, and the Holder hereby agrees that it will
not accept, any Distribution with respect to the Maker Obligations until the Senior Obligations are
indefeasibly paid in full in cash and all commitments to lend under the documents relating to any
or all of the Senior Obligations have been terminated other than the Permitted Maker Payments;
provided, however, that the Maker and the Holder further agree that no Permitted Maker Payments may
be made by the Maker or accepted by the Holder if:

               (i) at the time of such payment, a Senior Default exists and such Senior Default shall
not have been cured or waived; or

               (ii) Borrowing Availability (as such term is defined in the General Electric Capital
Corporation Credit Agreement) is less than $10,000,000 immediately before or after giving
effect to such payment.

          (c) in the event of any proceeding under the Bankruptcy Code involving the Maker or any other
voluntary or involuntary insolvency, bankruptcy, receivership, custodianship, liquidation,
dissolution, reorganization, assignment for the benefit of creditors, appointment of a custodian,
receiver, trustee or other officer with similar powers proceeding for the liquidation, dissolution
or other winding up of the Maker (each a “Proceeding”):

               (i) all Senior Obligations shall first be indefeasibly paid in full in cash and all
commitments to lend under the documents relating to any or all of the Senior Obligations
shall be terminated before any Distribution, whether in cash, securities or other property,
shall be made to the Holder on account of any Maker Obligation, and

               (ii) any Distribution, whether in cash, securities or other property which would
otherwise, but for the terms hereof, be payable or deliverable in respect of the Maker
Obligations shall be paid or delivered directly to the holders of the Senior Obligations
until all Senior Obligations are indefeasibly paid in full in cash and all commitments to
lend under the documents relating to any or all of the Senior Obligations have been
terminated; and

               (iii) Senior Obligations shall continue to be treated as Senior Obligations and the
provisions of this Section shall continue to govern the relative rights and priorities of
the holders of Senior Obligations and Holder even if all or part of the Senior Obligations
or the security interests securing the Senior Obligations are

Term Note

14

 

subordinated, set aside, avoided, invalidated or disallowed in connection with any such
Proceeding and these provisions shall be reinstated if at any time any payment of any of the
Senior Obligations is rescinded or must otherwise be returned by any holder of Senior
Obligations or any representative of such holder;

          (d) until the Senior Obligations are indefeasibly paid in full in cash and all commitments to
lend under any or all of the documents relating to any or all of the Senior Obligations have been
terminated, the Holder shall not take any Enforcement Action with respect to the Maker Obligations;

          (e) if any Distribution on account of the Maker Obligations not permitted to be made by the
Maker or accepted by the Holder under this Section is made and is received by the Holder, such
Distribution shall not be commingled with any of the assets of the Holder, shall be held in trust
by the Holder for the benefit of the holders of the Senior Obligations and shall be promptly paid
over to the holders of the Senior Obligations for application to the payment of the Senior
Obligations then remaining unpaid, until all of the Senior Obligations are paid in full; and

          (f) with respect to the value of any Distribution that the Holder pays over to the holders of
the Senior Obligations under the terms of this Section, the Holder shall be subrogated to the
rights of the holders of the Senior Obligations, provided, however, that the Holder shall not
assert or enforce any of such rights of subrogation it may acquire as a result of any such
Distributions until all Senior Obligations are indefeasibly paid in full in cash and all
commitments to lend under the documents relating to any or all of the Senior Obligations have been
terminated. The Maker acknowledges and agrees that the value of any Distributions received by the
Holder that are paid over to the holders of the Senior Obligations pursuant to this Section shall
not reduce any of the Maker Obligations.

Notwithstanding the foregoing, (i) no provision herein shall prevent the Holder from filing
lawsuits to prevent the running of any applicable statute of limitations or other similar
restrictions on claims (provided, however, that such lawsuits shall not be filed earlier than one
month prior to the running of the applicable statute of limitation or other similar restrictions on
claims), and (ii) in any liquidation, reorganization, bankruptcy or similar proceeding in respect
of the Maker, the Holder may file proofs of claim against the Maker.

     8.2 Modifications to and Enforcement of Senior Obligations. The holders of the Senior
Obligations or any representative thereof may at any time and from time to time without the consent
of or notice to Holder, without incurring liability to Holder and without impairing or releasing
the obligations of Holder hereunder, change the manner or place of payment or extend the time of
payment of or increase the amount of indebtedness advanced or to be advanced under or renew or
alter any of the terms of the Senior Obligations, or amend in any manner any agreement, note,
guaranty or other instrument evidencing or securing or otherwise relating to the Senior Obligations
or take any moneys which may now or hereafter be owing with respect to the Senior Obligations or
take any action with respect to the whole or any part of the Senior Obligations, including, without
limitation, any action to enforce payment of or to collect the whole or any part of the Senior
Obligations, to accelerate payment of the Senior Obligations or to foreclose or realize upon or
enforce any of their rights with respect to any of the collateral (including, without limitation,
any inventory) securing Senior Obligations (“Senior Collateral”)

Term Note

15

 

(including, without limitation, the disposition thereof). Holder agrees not to initiate,
prosecute or participate in any claim, action or other proceeding challenging the enforceability,
validity, perfection or priority of the Senior Obligations or any liens and security interests
securing the Senior Obligations.

     8.3 Access. The holders of the Senior Obligations (or their representatives or
invitees) may at any time and from time to time enter the real property described on Schedule I
hereto without any interference by Holder to inspect or remove any or all of the Senior Collateral,
provided, however, that the holders of the Senior Obligations shall promptly repair, at their
expense, or reimburse Holder for any physical damage to such real property actually caused by any
removal of Senior Collateral by or through such holders (ordinary wear and tear excluded).

Section 8.1, Section 8.2 and Section 8.3 are intended for the benefit of, and will be enforceable
as a third party beneficiary by, any or all present and future holders of the Senior Obligations,
and no amendment or supplement to the provisions set forth in Section 8.1, Section 8.2 or Section
8.3 shall become effective unless such amendment or supplement is consented to in writing signed by
the holders of the Senior Obligations.

[Space intentionally left blank.]

Term Note

16

 

     IN WITNESS WHEREOF, the Maker has caused this Term Note to be executed and delivered as of the
date first set forth above.

	 	 	 	 	 
	 	Maker:

INSTEEL WIRE PRODUCTS COMPANY

a North Carolina corporation

 	 
	 	By:  	/s/ H.O. Woltz III
 	 
	 	 	Name:  	H.O. Woltz III 	 
	 	 	Title:  	President 	 
	 

Term Note

17

 

Schedule I — Real Property Collateral

Kingman Facility

Location Number: 502

Building Description: ICM, 109,300 sq ft

Address: 4750 North Olympic Dr, Kingman, AZ 86401

Legal Description:

The following described real property located in Mohave County, Arizona:

PARCEL NO. 1:

Parcel IX-K, as shown on Survey Plat recorded August 23, 1988, at Fee No. 88-35230 and
retraced on plat recorded December 19, 1990, at Fee No. 90-85600, records of Mohave County,
Arizona and being a division of the Northeast quarter (NE1/4) of Section 26, Township 22
North, Range 16 West of the Gila and Salt River Base and Meridian, Mohave County, Arizona.

EXCEPT all coal and other minerals, as reserved in instrument recorded in Book 34 of Deeds,
Page 308.

PARCEL NO. 2:

Parcel IX-G-B, as shown on Record of Survey Plat recorded October 21, 1991, in Book 7 of
Records of Surveys, Page 89, records of Mohave County, Arizona and being a division of the
Northeast quarter (NE1/4) of Section 26, Township 22 North, Range 16 West of the Gila and
Salt River Base and Meridian, Mohave County, Arizona.

EXCEPT the Northwesterly 186.03 feet thereof.

EXCEPT all coal and other minerals, as reserved in instrument recorded in Book 34 of Deeds,
Page 308.

EXEMPT: A.R.S. 11-1134 B7

St. Joseph Facility

Location Number: 503

Building Description: Concrete, 156,980 sq ft

Address: 801 Atchison St, St. Joseph, MO, 64503

Term Note

 Schedule I - Page 1

 

Legal Description:

The following described real property located in Buchanan County, Missouri:

TRACT A:

Lots 8, 9, 10, 11, 12 and 13, in Block 2, Lots 1 to 17 inclusive, in Block 3, Lots 1 to 20
inclusive in Block 4 and Lots 1 to 6 inclusive, 8 to 13 inclusive and 15 to 20 inclusive, in Block
5, all in Fowler’s addition to the City of St. Joseph, Mo.

The west 90 feet of Block 2 and all of Block 3, in Guthrie’s addition, an addition to the City of
St. Joseph, Buchanan County, Mo., situate in the southern quarter of Section 20, TWP. 57 N., RNG.
35 W.

The west 90 feet of the east/west alley in said Block 2, Fowler’s addition, vacated by Special
Ordinance #10871 of the City of St. Joseph, Missouri. All of the east/west alley in Block 3,
Fowler’s addition, vacated by Special Ordinance #8300 of the City of St. Joseph, Missouri.

All of the east/west alley in Block 4, Fowler’s addition, vacated by Special Ordinance #8300 of the
City of St. Joseph, Missouri.

The west 90 feet of the east/west alley in Block 5, in Fowler’s addition, vacated by Special
Ordinance #10871 of the City of St. Joseph, Missouri. The north/south alley in Block 5, Fowler’s
addition and the east/west alley in said Block 5, Fowler’s addition lying between 10th Street and
the east line of said north/south alley, vacated by Special Ordinance #16387 of the City of St.
Joseph, Missouri.

All of the Fowler Street from the west line of Ninth Street to the west line of Fowler’s addition,
as vacated by Special Ordinance #8298 of the City of St. Joseph, Missouri.

The north one half of Fowler Street adjoining Lots 11, 12, and 13, Block 2, Fowler’s addition on
the south and the south one half of Fowler Street adjoining Lots 8, 9, and 10, in Block 5, Fowler’s
addition on the north, as vacated by Special Ordinance #10871 of the City of St. Joseph, Missouri.

Belle Street from the west line of the north/south alley in Block 5, in Fowler’s addition west to
right of way of the Chicago, Rock Island & Pacific Railroad Company, vacated by Special Ordinance
#11219 of the City of St. Joseph, Missouri.

Ninth Street from the south line of Atchison Street to the north line of Belle Street, vacated by
Special Ordinance #10871 of the City of St. Joseph, Missouri and from the south line of Belle
Street south to the right of way of the Chicago, Rock Island and Pacific Railroad Company, vacated
by Special Ordinance #11219 of the City of St. Joseph, Missouri.

A parcel of land located in the southeast quarter (se 1/4) of Section Twenty (20), Township
Fifty-Seven (57) North, Range Thirty-Five (35) West, being more fully described as follows:
commencing at the center of Section Twenty (20), Township Fifty-Seven (57) North, Range Thirty-Five
(35) West; thence east measured along the east and west center line of Section

Term Note

 Schedule I - Page 2

 

Twenty (20), seven hundred twelve and six-tenths (712.6) feet; thence southerly at an angle of
ninety six degrees and ten minutes (96o10’) to the right, three hundred eight and
sixty-seven hundredths (308.67) feet to the Point of Beginning. Said point being twelve and
five-tenths (12.5) feet easterly measured radially to Chicago, Rock Island and Pacific Railroad
Company’s main track as now located; thence continuing southerly parallel with and twelve and
five-tenths (12.5) feet from the center line of said Tract two hundred forth-one and eight tenths
(241.8) feet; thence southeasterly at an angle to the left of five degrees and fifty-eight minutes
(5o58’) from a line produced through the two (2) last described points one hundred
twenty-four and four tenths (124.4) feet, to a point twenty-five (25) feet easterly measured
radially to the center line of the original location of old main line to Trenton; thence
southeasterly on a curve to the left with a radius of four hundred fifty-three and thirty-four
hundredths (453.34) feet, a distance of three hundred seventy-eight and eight-tenths (378.8) feet;
thence northeasterly at right angles to tangent to said curve, a distance of fifty (50) feet;
thence northwesterly on a curve to the right with a radius of four hundred three and thirty-four
hundredths (403.34) feet, a distance of four hundred twenty-one and six tenths (421.6) feet; thence
westerly at right angles to tangent to said curve, forty-five (45) feet to a point thirty (30) feet
easterly measured radially to the centerline of the original main track; thence northerly parallel
with and thirty (30) feet from the center line of said Railroad Company’s main track to Atchison
Street, two hundred seventy (270) feet; thence westerly seventeen and five tenths (17.5) feet to
the Point of Beginning, except any part thereof conveyed by St. Joseph Structural Steel Company, a
Missouri corporation, to Chicago, Rock Island and Pacific Railroad Company, a Delaware corporation
by quit claim deed dated June 21, 1954 and recorded in Book 955, at Page 147 in the Office of the
Recorder of Deeds, Buchanan County, Missouri.

TRACT B:

The Point of Beginning being on a line thirty feet easterly of and parallel to the centerline of
Grantor’s St. Joseph to Winthrop Main Track and on a line oriented at right angles to said
centerline located five hundred sixty-nine and nine tenths feet southerly of the east/west
centerline of Section 20, as measured along said track centerline, Township 57 North, Range 35 West
of the Fifth Principal Meridian; thence easterly along said line oriented at right angles to said
centerline to a line twenty-five feet easterly of and parallel to the centerline of Grantor’s Wye
Track to his abandoned St. Joseph to Coburn Line; thence southeasterly along the last line
intersected to a line oriented at right angles to said track centerline located four hundred
eighty-four feet southerly of said east/west centerline of Section 20, as measured along said track
centerline; thence northerly along a line radial to said track centerline to a line seventy-five
feet northerly of and parallel to said track centerline; thence easterly along the last line of
intersected to the west line of the east thirty feet of Lot 2, Block 2 of Guthrie’s addition to the
City of St. Joseph; thence southerly along the last line intersected one hundred ninety-five feet
more or less, to the south line of the north half of the southeast quarter of said Section 20;
thence westerly along said south line five hundred forty-eight feet, more or less, to the easterly
line of that highway easement from the Grantor to the State Highway Commission of Missouri dated
February 28, 1978; thence north 0o50’24” east for fifty-three and twenty-one hundredths
feet; thence north 14o31’14” west for one hundred twenty-one and twenty-seven hundredths
feet; thence south 75o28’46” west for sixty-one and seven tenths feet; thence north
14o31’14” west one hundred seven feet, more or less, to said line thirty feet easterly
of and parallel to said main track centerline; thence northerly along the last line intersected to
the Point of Beginning; all in

Term Note

 Schedule I - Page 3

 

the north half of the southeast quarter of Section 20, Township 57 North, Range 35 West of the
Fifth Principal Meridian.

Term Note

 Schedule I - Page 4exv4w1

Exhibit 4.1

 

SEVENTH SUPPLEMENTAL INDENTURE

Dated as of November 22, 2010

 

between

LOWE’S COMPANIES, INC.

and

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

as Trustee

 

Supplemental to the Amended and Restated Indenture

Dated as of December 1, 1995

 

Creating a Series of Securities designated

2.125% Notes due 2016,

and

Creating a Series of Securities designated

3.750% Notes due 2021

 

 

     SEVENTH SUPPLEMENTAL INDENTURE, dated as of November 22, 2010 (this “Seventh Supplemental
Indenture”), between Lowe’s Companies, Inc., a corporation duly organized and existing
under the laws of the State of North Carolina (the “Company”), having its principal office
at 1000 Lowe’s Boulevard, Mooresville, North Carolina 28117, and The Bank of New York Mellon
Trust Company, N.A., a national banking association duly organized and existing under the laws
of the United States, as Trustee (the “Trustee” or the “Successor Trustee”) as
successor trustee to J.P. Morgan Trust Company, National Association (the “Resigning
Trustee”), pursuant to that certain Instrument of Resignation, Appointment and Acceptance,
dated as of April 21, 2004, (the “Resignation Instrument”).

WITNESSETH:

          WHEREAS, the Company has heretofore executed and delivered to the Resigning Trustee an Amended
and Restated Indenture, dated as of December 1, 1995 (the “Base Indenture”) as supplemented
and amended by this Seventh Supplemental Indenture (together with the Base Indenture, the
“Indenture”), providing for the issuance from time to time of its unsecured unsubordinated
debentures, notes or other evidences of indebtedness (the “Securities”), to be issued in
one or more series as provided in the Base Indenture;

          WHEREAS, pursuant to the Resignation Instrument and the applicable provisions of the Base
Indenture, the Resigning Trustee assigned, transferred, delivered and confirmed to the Successor
Trustee all right, title and interest of the Resigning Trustee under the Indenture, with like
effect as if the Successor Trustee was originally named as trustee under the Indenture, and the
Company accepted the resignation of the Resigning Trustee as trustee, Paying Agent, Security
Registrar, Conversion Agent and Agent under the Indenture and duly appointed the Successor Trustee
as trustee, Paying Agent, Security Registrar, Conversion Agent and Agent under the Indenture and
confirmed to the Successor Trustee all the rights, powers and trusts of the Resigning Trustee under
the Base Indenture;

          WHEREAS, it is provided in Section 901 of the Base Indenture that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee may enter into
indentures supplemental thereto (1) to add to, change or eliminate any of the provisions of the
Indenture in respect of one or more series of Securities, provided that any such addition, change
or elimination (i) shall neither (A) 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 (B)
modify the rights of the Holder of any such Security with respect to such provision or (ii) shall
become effective only when there is no such Security Outstanding, (2) to add to the 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 solely for the benefit of such series) and (3) to establish
the form or terms of Securities of any series as permitted by Sections 201 and 301 of the Base
Indenture;

          WHEREAS, the Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Indenture and pursuant to appropriate Board Resolutions and
actions of its authorized officers, has duly determined to make, execute and deliver to the Trustee
this Seventh Supplemental Indenture in order to establish the form and

 

 

terms of, and to provide for the creation and issuance of, two new series of Securities
designated as its (i) 2.125% Notes due 2016 (the “2016 Notes”), in an aggregate Principal
Amount at Maturity of $475,000,000 and (ii) 3.750% Notes due 2021 (the “2021 Notes” and,
together with the 2016 Notes, the “Notes”) in an aggregate Principal Amount at Maturity of
$525,000,000; and

          WHEREAS, all things necessary to make the Notes, when executed by the Company and
authenticated and delivered by the Trustee or any Authenticating Agent (as defined in the
Indenture) and issued upon the terms and subject to the conditions of the Indenture against payment
therefor, the valid, binding and legal obligations of the Company and to make this Seventh
Supplemental Indenture a valid and legally binding supplement to the Indenture.

          NOW, THEREFORE, in order to establish the form and terms of the series of the 2016 Notes and
the series of the 2021 Notes and for and in consideration of the premises and of the covenants
contained in the Indenture and for other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, it is mutually covenanted and agreed, for the equal
and proportionate benefit of all Holders, as follows:

ARTICLE I

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

     Section 101. Definitions. For all purposes of the Base Indenture and this Seventh Supplemental Indenture relating to the
respective series of Notes created hereby, except as otherwise expressly provided or unless the
context otherwise requires, the terms used in this Seventh Supplemental Indenture have the meanings
assigned to them in this Article. Each capitalized term that is used in this Seventh Supplemental
Indenture but not defined herein shall have the meaning specified in the Base Indenture.

          “Business Day” means any day other than a Saturday or Sunday or a day on which banking
institutions or trust companies in New York City are authorized or required by law, regulation or
executive order to close.

          “Change of Control” means the occurrence of any of the following: (a) the
consummation of any transaction (including, without limitation, any merger or consolidation)
resulting in any “person” (as that term is used in Section 13(d)(3) of the Securities and Exchange
Act of 1934)(other than the Company or one of its subsidiaries) becoming the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Securities and Exchange Act of 1934), directly or
indirectly, of more than 50% of the Voting Stock of the Company or other voting stock into which
Voting Stock of the Company is reclassified, consolidated, exchanged or changed, measured by voting
power rather than number of shares; (b) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in a transaction or a series of related
transactions, of all or substantially all of the assets of the Company and the assets of its
subsidiaries, taken as a whole, to one or more “persons” (as that term is defined in the
Indenture)(other than the Company or one of its subsidiaries); or (c) the first day on which a
majority of the members of the Board of Directors of the Company are not Continuing Directors.
Notwithstanding the foregoing, a transaction shall not be considered a Change of Control if
(a) the Company becomes a direct or indirect wholly-owned subsidiary of a holding company and

2

 

(b)(y) immediately following that transaction, the direct or indirect holders of the voting stock
of the holding company are substantially the same as the holders of voting stock of the Company
immediately prior to that transaction or (z) immediately following that transaction no person is
the beneficial owner, directly or indirectly, of more than 50% of the voting stock of the holding
company.

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

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

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

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

          “Depositary” means, with respect to the Notes issuable in whole or in part in global
form, DTC and any nominee thereof, until a successor is appointed and becomes such pursuant to the
applicable provisions of the Indenture, and thereafter “Depositary” shall mean or include
such successor and any nominee thereof.

          “DTC” means The Depository Trust Company.

          “Global Note” means a Note issued in global form and deposited with or on behalf of
the Depositary, substantially in the form of the Note attached hereto as Exhibit A-1 or Exhibit
A-2.

          “Interest Payment Date” has the meaning set forth in Section 204(a) of this Seventh
Supplemental Indenture.

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

3

 

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

          “Principal Amount at Maturity” of the Notes means the principal amount at maturity as
set forth on the face of each respective Note.

          “Quotation Agent” means the Reference Treasury Dealer appointed by the Company.

          “Rating Agencies” means (a) each of Moody’s and S&P; and (b) if either of Moody’s or
S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons
outside of the control of the Company, a “nationally recognized statistical rating organization”
(within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Securities Exchange Act of 1934) selected
by the Company as a replacement rating agency for a former rating agency.

          “Rating Event” means the rating on the Notes is lowered by each of the Rating Agencies
and the Notes are rated below an Investment Grate Rating by each of the Rating Agencies on any day
within the 60-day period (which 60-day period shall be extended so long as the rating of the Notes
is under publicly announced consideration for a possible downgrade by any of the Rating Agencies)
after the earlier of (a) the occurrence of a Change of Control and (b) public notice of the
particular Change of Control or the Company’s intention to effect a Change of Control; provided
that a Rating Event will not be deemed to have occurred in respect of a particular Change of
Control (and thus shall not be deemed a Rating Event for purposes of the definition of Change of
Control Triggering Event) if each Rating Agency making the reduction in rating does not publicly
announce or confirm or inform the Trustee in writing at the request of the Company that the
reduction was the result, in whole or in part, of any event or circumstance comprised of or arising
as a result of, or in respect of, the Change of Control (whether or not the applicable Change of
Control has occurred at the time of the Rating Event).

          “Reference Treasury Dealer” means each of (i) a Primary Treasury Dealer selected by
Wells Fargo Securities, LLC and its successors, (ii) a Primary Treasury Dealer selected by U.S.
Bancorp Investments, Inc. and its successors; provided, however, that if any of the foregoing in
(i) or (ii) shall cease to be a primary U.S. Government securities dealer in New York City (a
“Primary Treasury Dealer”), the Company will substitute therefor another Primary Treasury
Dealer, and (iii) any other two Primary Treasury Dealers selected by the Company.

          “Reference Treasury Dealer Quotations” means, with respect to such Reference Treasury
Dealer and any redemption date, the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the
Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business
Day preceding such redemption date.

          “Regular Record Date” has the meaning set forth in Section 204(a) of this Seventh
Supplemental Indenture.

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

4

 

          “Stated Maturity” has the meaning set forth in Section 203 of this Seventh
Supplemental Indenture.

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

          “Underwriting Agreement” means the Underwriting Agreement, dated November 17, 2010,
among the Company and Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc.

          “Voting Stock” means, with respect to any specified person (as that term is used in
Section 13(d)(3) of the Securities Exchange Act of 1934) as of any date, the capital stock of such
person that is at the time entitled to vote generally in the election of the board of directors of
such person.

     Section 102. Section References. Each reference to a particular section set forth in this Seventh Supplemental Indenture shall,
unless the context otherwise requires, refer to this Seventh Supplemental Indenture. Each
reference to a particular section of the Base Indenture shall refer to that particular section of
the Base Indenture.

ARTICLE II

THE NOTES

     Section 201. Title of the Notes. The Company hereby creates the 2016 Notes and the 2021 Notes, each as a separate series of its
Securities issued pursuant to the Indenture. The 2016 Notes shall be designated as the “2.125%
Notes due 2016,” and the 2021 Notes shall be designated as the “3.750% Notes due 2021.”

     Section 202. Amount. The aggregate Principal Amount at Maturity of the 2016 Notes that may be authenticated and
delivered under this Seventh Supplemental Indenture is initially limited to $475,000,000 and the
aggregate Principal Amount at Maturity of the 2021 Notes that may be authenticated and delivered
under this Seventh Supplemental Indenture is initially limited to $525,000,000. Either series of
Notes may be reopened, without the consent of the holders of the Notes, for issuance of additional
Notes of such series.

     Section 203. Stated Maturity. The Stated Maturity of the 2016 Notes shall be April 15, 2016 and the Stated Maturity of the
2021 Notes shall be April 15, 2021.

     Section 204. Interest and Payment. (a) The 2016 Notes shall bear interest at 2.125% per annum and the 2021 Notes shall bear
interest at 3.750% per annum beginning on the date of issuance until the Notes, respectively, are
redeemed, paid or duly provided for. Interest shall be paid semi-annually in arrears on each April
15 and October 15 (each, an “Interest Payment Date”), commencing on April 15, 2011, to
persons in whose names the Notes are registered at the close of the Business Day on the April 1
immediately preceding each April 15 or the October 1 immediately preceding each October 15 (each a
“Regular Record Date”).

5

 

     (b) Payments of interest on the Notes shall include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for the Notes shall be computed on the basis
of a 360-day year composed of twelve 30-day months. Payments of principal and interest to owners
of book-entry interests shall be made to holders of the Notes on the respective Regular Record Date
in accordance with the procedures of DTC and its participants in effect from time to time.
Settlement for the Notes shall be made in immediately available funds. All payments of principal
and interest shall be made by the Company in immediately available funds except as set forth in the
applicable Note.

     Section 205. Optional Redemption. (a) Before the date that is one month (for the 2016 Notes) or three months (for the 2021
Notes) prior to the applicable maturity date for such series of Notes, the Notes of each series
will be redeemable, in whole at any time or in part from time to time, at the Company’s option at a
redemption price equal to the greater of:

     (i) 100% of the principal amount of the 2016 Notes and/or the 2021 Notes to be
redeemed; or

     (ii) the sum of the present values of the remaining scheduled payments of principal and
interest thereon (not including any portion of such payments of interest accrued as of the
date of redemption), discounted to the date of redemption on a semi-annual basis (assuming a
360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 10 basis points
with respect to the 2016 Notes and 15 basis points with respect to the 2021 Notes,

plus, in each case, accrued interest thereon to but excluding the date of redemption.

     (b) On or after the date that is one month (for the 2016 Notes) or three months (for the 2021
Notes) prior to the applicable maturity date for such series of Notes, the Notes of each series
will be redeemable, in whole at any time or in part from time to time, at the Company’s option at
par plus accrued interest thereon to but excluding the date of redemption.

     (c) Notwithstanding the foregoing, installments of interest on Notes that are due and payable
on Interest Payment Dates falling on or prior to a redemption date will be payable on the
Interest Payment Date to the registered holders as of the close of the Business Day on the
relevant record date.

     (d) Notice of any redemption will be mailed at least 30 days but not more than 60 days before
the Redemption Date set forth in such notice to each registered holder of the 2016 Notes and/or the
2021 Notes, as the case may be, to be redeemed. Unless the Company defaults in payment of the
redemption price, on and after the applicable Redemption Date, interest will cease to accrue on the
Notes or portions thereof called for redemption. If less than all of the Notes are to be redeemed,
the Notes to be redeemed shall be selected by the Trustee by a method the Trustee deems to be fair
and appropriate.

     Section 206. Change of Control Offer to Purchase.

     (a) If a Change of Control Triggering Event occurs, holders of Notes may require the Company
to repurchase all of any part (equal to $2,000 or an integral multiple of $1,000 in

6

 

excess thereof)
of their Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid
interest, if any, on such Notes to the date of purchase (unless a notice of redemption has been
mailed within 30 days after such Change of Control Triggering Event stating that all of the Notes
will be redeemed as described in this Section 206). The Company shall be required to mail to
holders of the Notes a notice describing the transaction or transactions constituting the Change of
Control Triggering Event and offering to repurchase the Notes. The notice must be mailed within 30
days after any Change of Control Triggering Event, and the repurchase must occur no earlier than 30
days and no later than 60 days after the date the notice is mailed.

     (b) On the date specified for repurchase of the Notes, the Company shall, to the extent
lawful:

     (i) accept for payment all properly tendered Notes or portions of Notes;

     (ii) deposit with the paying agent the required payment for all properly tendered Notes
or portions of Notes; and

     (iii) deliver to the Trustee the repurchased Notes, accompanied by an Officers’
Certificate stating, among other things, the aggregate principal amount of repurchased
Notes.

     (c) The Company shall comply with the requirements of Rule 14e-1 under the Securities Exchange
Act of 1934 and any other securities laws and regulations applicable to the repurchase of the
Notes. To the extent that these requirements conflict with the provisions requiring repurchases of
the Notes, the Company shall comply with such requirements instead of the repurchase provisions and
shall not be considered to have breached its obligations with respect to repurchasing the Notes.
Additionally, if an Event of Default exists under the Indenture (which is unrelated to the
repurchase provisions of the Notes), including the events of default arising with respect to other
issues of debt securities, the Company shall not be required to repurchase the Notes
notwithstanding these repurchase provisions.

     (d) The Company shall not be required to comply with the obligations of this Section 206 if a
third party instead satisfies them.

     Section 207. Forms; Denominations. The Notes shall be Registered Securities and shall be issued in minimum denominations of
$2,000 and integral multiples of $1,000 thereafter. The certificates for the Notes shall be in
substantially the forms attached hereto as Exhibit A-1 and Exhibit A-2.

     (a) Global Notes. (i) Notes shall be issued initially in the form of one or more
Global Notes in definitive fully registered form without interest coupons, deposited on behalf of
the subscribers for the Notes represented thereby with The Bank of New York Mellon Trust Company,
N.A., at its Corporate Trust Office, as custodian for the Depositary and registered in the name of
DTC or a nominee thereof, duly executed by the Company and authenticated by the Trustee as provided
in the Indenture. The aggregate Principal Amount at Maturity of the Global Notes may from time to
time be increased or decreased by adjustments made on the records of the Trustee and the Depositary
as hereinafter provided.

7

 

     (ii) Book-Entry Provisions. The Company shall execute and the Trustee shall, in
accordance with this Section 207(a)(ii) and Section 303 of the Base Indenture, authenticate
and deliver initially one or more Global Notes that (a) shall be registered in the name of
the Depositary, (b) shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary’s instructions and (c) shall bear legends substantially to the following effect:

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

     Section 208. Applicability of Reports by Company. For purposes of this Seventh Supplemental Indenture, to the extent information, documents or
reports are required to be filed with the Commission and delivered to the Trustee or the Holders,
the availability of such information, documents or reports on the Commission’s Electronic Data
Gathering Analysis and Retrieval (“EDGAR”) system or the Company’s website shall be deemed
to have satisfied such delivery requirements to the Trustee or the Holders, as applicable.

     Section 209. Applicability of Sinking Funds. The provisions of Article Twelve of the Base Indenture shall not apply to the 2016 Notes or
the 2021 Notes.

     Section 210. Applicability of Repayment of Securities at Option of Holders. The provisions of Article Thirteen of the Base Indenture shall not apply to the 2016 Notes or
the 2021 Notes.

     Section 211. Applicability of Conversion of Securities. The provisions of Article Fourteen of the Base Indenture shall not apply to the 2016 Notes or
the 2021 Notes.

ARTICLE III

MISCELLANEOUS PROVISIONS

     Section 301. Concerning the Indenture. Except as expressly amended hereby, the Base Indenture shall continue in full force and effect
in accordance with the provisions thereof and the

8

 

Base Indenture is in all respects hereby ratified
and confirmed. This Seventh Supplemental Indenture and all its provisions shall be deemed a part
of the Base Indenture in the manner and to the extent herein and therein provided.

     Section 302. Severability. If any provision in this Seventh Supplemental Indenture 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 303. Trust Indenture Act. If any provision in this Seventh Supplemental Indenture limits, qualifies or conflicts with
any other provision hereof or of the Base Indenture which provision is required to be included in
the Base Indenture by any of the provisions of the Trust Indenture Act, such required provision
shall control.

     Section 304. Trustee. The recitals and statements herein are deemed to be those of the Company and not of the
Trustee. The Trustee makes no representations as to the validity or sufficiency of this Seventh
Supplemental Indenture.

     Section 305. Governing Law. This Seventh Supplemental Indenture shall be governed by, and construed in accordance with,
the laws of the State of New York.

     Section 306. Multiple Originals. This Seventh Supplemental Indenture may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.

9

 

          IN WITNESS WHEREOF, the parties have caused this Seventh Supplemental Indenture to be duly
executed.

	 	 	 	 	 
	 	LOWE’S COMPANIES, INC.

 	 
	 	By:  	/s/ Robert F. Hull, Jr.
 	 
	 	 	Name:  	Robert F. Hull, Jr. 	 
	 	 	Title:  	Executive Vice President and

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

 	 
	 	By:  	/s/ Tina D. Gonzalez
 	 
	 	 	Name:  	Tina D. Gonzalez 	 
	 	 	Title:  	Vice President 	 
	 

 

 

EXHIBIT A-1

FORM OF GLOBAL NOTE

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

LOWE’S COMPANIES, INC.

2.125% Notes due April 15, 2016

GLOBAL SECURITY

			
	 	 	 
	No.
	 	CUSIP No.
	 
	 	$

Original Principal Amount

     Lowe’s Companies, Inc., a corporation duly organized and existing under the laws of the State
of North Carolina (herein called the “Company”, which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or its
registered assigns, the principal sum of $        on April 15, 2016, at the office or agency of the
Company referred to below, in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts, and to pay interest thereon
in like coin or currency from November 22, 2010, or from the most recent Interest Payment Date on
which interest has been paid or duly provided for, semi-annually in arrears on April 15 and October
15 in each year, commencing April 15, 2011, at the rate of 2.125% per annum until the principal
hereof is paid or made available for payment, and (to the extent lawful) to pay interest at the
same rate per annum on any overdue principal and premium and on any overdue installments of
interest until paid.

     The interest so payable, and punctually paid or duly provided for, on any Interest Payment
Date, as provided in the Amended and Restated Indenture, dated as of December 1, 1995 (the “Base
Indenture”) between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee
(the “Trustee”), as supplemented by the Seventh Supplemental Indenture dated as of November 22,
2010, between the Company and the Trustee (the “Seventh

A-1-1

 

Supplemental Indenture” and, together with the Base Indenture, the “Indenture”) shall be paid
to the Person in whose name this Note is registered at the close of business on the respective
Regular Record Date for such interest, which shall be the April 1 or October 1 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable to the Person in
whose name this Note is registered on such Regular Record Date and may either be paid to the Person
in whose name this Note is registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest to be fixed in accordance with Section 307 of the Base Indenture
by the Trustee, notice whereof shall be given to the Person in whose name this Note is registered
not less than ten days prior to such Special Record Date, or be paid at any time in any other
lawful manner, all as more fully provided in the Indenture.

     This Note is a “book-entry” note and is being registered in the name of Cede & Co. as nominee
of The Depository Trust Company (“DTC”), a clearing agency. Subject to the terms of the Indenture,
this Note will be held by a clearing agency or its nominee, and beneficial interests will be held
by beneficial owners through the book-entry facilities of such clearing agency or its nominee in
minimum denominations of $2,000 and increments of $1,000 in excess thereof.

     As long as this Note is registered in the name of DTC or its nominee, the Trustee will make
payments of principal of and interest on this Note by wire transfer of immediately available funds
to DTC or its nominee. Notwithstanding the above, the final payment on this Note will be made
after due notice by the Trustee of the pendency of such payment and only upon presentation and
surrender of this Note at its principal corporate trust office or such other office or agencies
appointed by the Trustee for that purpose and such other locations provided in the Indenture.

     Payments of principal of (and premium, if any) and interest on this Note will be made at the
office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City
of New York, in such coin or currency of the United States of America as at the time of payment is
legal tender for payments of public and private debts; provided, however, that at the option of the
Company, payment of interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.

     This Note is one of a duly authorized series of notes of the Company, designated 2.125% Notes
due 2016 (the “Notes”), initially limited in aggregate principal amount at any time outstanding to
FOUR HUNDRED SEVENTY-FIVE MILLION DOLLARS ($475,000,000) which may be issued under the Indenture.
This series of Notes may be reopened, without the consent of the holders of the Notes, for issuance
of additional Notes. Reference is hereby made to the Indenture and all indentures supplemental
thereto which are applicable to the Notes for a statement of the respective rights, limitations of
rights, duties, obligations and immunities thereunder of the Company, the Trustee and the Holders
of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered.
All terms used in this Note that are defined in the Indenture shall have the meanings assigned to
them in the Indenture.

     The Notes do not have the benefit of any sinking fund obligations.

A-1-2

 

     Before one month prior to April 15, 2016, the Notes will be redeemable, in whole at any time
or in part from time to time, at the Company’s option at a redemption price equal to the greater
of:

     (i) 100% of the principal amount of the Notes to be redeemed; or

     (ii) the sum of the present values of the remaining scheduled payments of principal and
interest thereon (not including any portion of such payments of interest accrued as of the date of
redemption), discounted to the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate, plus 10 basis points,

     plus, in each case, accrued interest thereon to but excluding the date of redemption.

     On or after the date that is one month prior to April 15, 2016, the Notes will be redeemable,
in whole at any time or in part from time to time, at the Company’s option at par plus accrued
interest thereon to but excluding the date of redemption.

     Notwithstanding the previous two paragraphs, installments of interest on Notes that are due
and payable on Interest Payment Dates falling on or prior to a redemption date will be payable on
the Interest Payment Date to the registered holders as of the close of the Business Day on the
relevant record date.

     Notice of any redemption will be mailed at least 30 days but not more than 60 days before the
Redemption Date to each registered holder of the Notes to be redeemed. Unless the Company defaults
in payment of the redemption price, on and after the Redemption Date, interest will cease to accrue
on the Notes or portions thereof called for redemption. If less than all of the Notes are to be
redeemed, the Notes to be redeemed shall be selected by the Trustee by a method the Trustee deems
to be fair and appropriate.

     Upon a Change of Control Triggering Event, the Company shall be required to make an offer to
repurchase the Notes on the terms set forth in the Indenture.

     If an Event of Default shall occur and be continuing, the principal of all the Notes may be
declared due and payable in the manner and with the effect provided in the Indenture.

     The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of
the Company under this Note and (b) certain restrictive covenants and the related defaults and
Events of Default applicable to the Company, in each case, upon compliance by the Company with
certain conditions set forth in the Indenture, which provisions apply to this Note.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Notes under the Indenture at any time by the Company and the Trustee with the consent of the
Holders of a majority in aggregate principal amount of the Notes at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to
waive compliance by the Company with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such

A-1-3

 

consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder
and upon all future Holders of this Note and of any Note issued upon the registration of transfer
thereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Note.

     No reference herein to the Indenture and provisions of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the
principal of (and premium, if any) and interest on this Note at the times, place and rate, and in
the coin or currency, as herein prescribed.

     As provided in the Indenture and subject to certain limitations on transfer of this Note by
DTC or its nominee, the transfer of this Note is registrable in the Security Register, upon
surrender of this Note for registration of transfer at the office or agency of the Company in the
Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by a written
instrument of transfer in the form attached hereto duly executed by the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, shall be issued to the designated
transferee or transferees.

     The Notes are issuable only in registered form in minimum denominations of $2,000 and integral
multiples of $1,000 thereafter. As provided in the Indenture and subject to certain limitations
therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of
different authorized denomination, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or exchange of Notes,
but the Company may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

     Prior to due presentment of this Note for registration of transfer, the Company, the Trustee
and any agent of the Company, or the Trustee may treat the Person in whose name this Note is
registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of
the Company, the Trustee or any such agent shall be affected by notice to the contrary.

     Interest on this Note shall be computed on the basis of a 360-day year of twelve 30-day
months.

     The Company shall furnish to any Holder of record of Notes, upon written request and without
charge, a copy of the Indenture.

     The Indenture and this Note each shall be governed by and construed in accordance with the
laws of the State of New York without regard to principles of conflicts of law.

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

A-1-4

 

     In Witness Whereof, Lowe’s Companies, Inc. has caused this Note to be signed by a
duly elected or appointed, qualified and serving officer and attested by a duly elected or
appointed, qualified and serving officer.

	 	 	 	 	 
	 	Lowe’s Companies, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Dated: November 22, 2010

	 	 	 	 	 

	Attest:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:

	 	 

	 	 
	 

	 	 

	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

     This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture. 

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

     as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Officer 	 
	 	 	 	 
	 

A-1-5

 

ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of this Note, shall be
construed as though they were written out in full according to applicable laws or regulations:

TEN COM — tenants in common

TEN ENT — tenants by the entireties

JT TEN — joint tenants with right of survivorship and not as tenants
in common

CUST — Custodian

U/G/M/A or UNIF GIFT MIN ACT — Uniform Gifts to Minors Act

Additional abbreviations may also be used though not in the above
list.

A-1-6

 

FORM OF TRANSFER

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

 

(Please print or typewrite name and address of assignee)

 

(Please insert Social Security or other identifying Number of Assignee)

the within Note of Lowe’s Companies, Inc. and does hereby irrevocably constitute and appoint
                                                            , Attorney, to transfer the said Note on the books of the within named Lowe’s
Companies, Inc., with full power of substitution in the premises.

Dated:                                        

	 	 	 	 	 

	 

	 	 

NOTICE: The signature to this assignment must correspond with the name as
written upon the face of this Note in every particular without alteration or
enlargement or any change whatever.
	 	 

	 	 	 

	 

SIGNATURE GUARANTEED:

	 	 
	The signature must be guaranteed by a member of the Securities Transfer Agents
Medallion Program. Notarized or witnessed signatures are not acceptable.
	 	 

A-1-7

 

PAYMENT INSTRUCTIONS

     The assignee should include the following for purposes of payment:

Payment shall be made, by wire transfer or otherwise, in immediately available funds, to
                                        , for the account of                                         ,
  account number                                         , or, if mailed by check, to                                        . Applicable reports and statements required to be
physically delivered under the terms of the Indenture should be mailed to
                                        . This information is provided by
                                        , the assignee named above, or
                                        , as its agent.

A-1-8

 

EXHIBIT A-2

FORM OF GLOBAL NOTE

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

LOWE’S COMPANIES, INC.

3.750% Notes due April 15, 2021

GLOBAL SECURITY

			
	 	 	 
	No.
	 	CUSIP No.

$

Original Principal Amount

     Lowe’s Companies, Inc., a corporation duly organized and existing under the laws of the State
of North Carolina (herein called the “Company”, which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or its
registered assigns, the principal sum of $        on April 15, 2021, at the office or agency
of the Company referred to below, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts, and to pay
interest thereon in like coin or currency from November 22, 2010, or from the most recent Interest
Payment Date on which interest has been paid or duly provided for, semi-annually in arrears on
April 15 and October 15 in each year, commencing April 15, 2011, at the rate of 3.750% per annum
until the principal hereof is paid or made available for payment, and (to the extent lawful) to pay
interest at the same rate per annum on any overdue principal and premium and on any overdue
installments of interest until paid.

     The interest so payable, and punctually paid or duly provided for, on any Interest Payment
Date, as provided in the Amended and Restated Indenture, dated as of December 1, 1995 (the “Base
Indenture”) between the Company and The Bank of New York Mellon Trust

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Company, N.A., as trustee (the “Trustee”), as supplemented by the Seventh Supplemental
Indenture dated as of November 22, 2010, between the Company and the Trustee (the “Seventh
Supplemental Indenture” and, together with the Base Indenture, the “Indenture”) shall be paid to
the Person in whose name this Note is registered at the close of business on the respective Regular
Record Date for such interest, which shall be the April 1 or October 1 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the Person in whose name
this Note is registered on such Regular Record Date and may either be paid to the Person in whose
name this Note is registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed in accordance with Section 307 of the Base Indenture by the
Trustee, notice whereof shall be given to the Person in whose name this Note is registered not less
than ten days prior to such Special Record Date, or be paid at any time in any other lawful manner,
all as more fully provided in the Indenture.

     This Note is a “book-entry” note and is being registered in the name of Cede & Co. as nominee
of The Depository Trust Company (“DTC”), a clearing agency. Subject to the terms of the Indenture,
this Note will be held by a clearing agency or its nominee, and beneficial interests will be held
by beneficial owners through the book-entry facilities of such clearing agency or its nominee in
minimum denominations of $2,000 and increments of $1,000 in excess thereof.

     As long as this Note is registered in the name of DTC or its nominee, the Trustee will make
payments of principal of and interest on this Note by wire transfer of immediately available funds
to DTC or its nominee. Notwithstanding the above, the final payment on this Note will be made
after due notice by the Trustee of the pendency of such payment and only upon presentation and
surrender of this Note at its principal corporate trust office or such other office or agencies
appointed by the Trustee for that purpose and such other locations provided in the Indenture.

     Payments of principal of (and premium, if any) and interest on this Note will be made at the
office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City
of New York, in such coin or currency of the United States of America as at the time of payment is
legal tender for payments of public and private debts; provided, however, that at the option of the
Company, payment of interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.

     This Note is one of a duly authorized series of notes of the Company, designated 3.750% Notes
due 2021 (the “Notes”), initially limited in aggregate principal amount at any time outstanding to
FIVE HUNDRED TWENTY-FIVE MILLION DOLLARS ($525,000,000) which may be issued under the Indenture.
This series of Notes may be reopened, without the consent of the holders of the Notes, for issuance
of additional Notes. Reference is hereby made to the Indenture and all indentures supplemental
thereto which are applicable to the Notes for a statement of the respective rights, limitations of
rights, duties, obligations and immunities thereunder of the Company, the Trustee and the Holders
of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered.
All terms used in this Note that are defined in the Indenture shall have the meanings assigned to
them in the Indenture.

     The Notes do not have the benefit of any sinking fund obligations.

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     Before three months prior to April 15, 2021, the Notes will be redeemable, in whole at any
time or in part from time to time, at the Company’s option at a redemption price equal to the
greater of:

     (i) 100% of the principal amount of the Notes to be redeemed; or

     (ii) the sum of the present values of the remaining scheduled payments of principal and
interest thereon (not including any portion of such payments of interest accrued as of the date of
redemption), discounted to the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate, plus 15 basis points,

plus, in each case, accrued interest thereon to but excluding the date of redemption.

     On or after the date that is three months prior to April 15, 2021, the Notes will be
redeemable, in whole at any time or in part from time to time, at the Company’s option at par plus
accrued interest thereon to but excluding the date of redemption.

     Notwithstanding the previous two paragraphs, installments of interest on Notes that are due
and payable on Interest Payment Dates falling on or prior to a redemption date will be payable on
the Interest Payment Date to the registered holders as of the close of the Business Day on the
relevant record date.

     Notice of any redemption will be mailed at least 30 days but not more than 60 days before the
Redemption Date to each registered holder of the Notes to be redeemed. Unless the Company defaults
in payment of the redemption price, on and after the Redemption Date, interest will cease to accrue
on the Notes or portions thereof called for redemption. If less than all of the Notes are to be
redeemed, the Notes to be redeemed shall be selected by the Trustee by a method the Trustee deems
to be fair and appropriate.

     Upon a Change of Control Triggering Event, the Company shall be required to make an offer to
repurchase the Notes on the terms set forth in the Indenture.

     If an Event of Default shall occur and be continuing, the principal of all the Notes may be
declared due and payable in the manner and with the effect provided in the Indenture.

     The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of
the Company under this Note and (b) certain restrictive covenants and the related defaults and
Events of Default applicable to the Company, in each case, upon compliance by the Company with
certain conditions set forth in the Indenture, which provisions apply to this Note.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Notes under the Indenture at any time by the Company and the Trustee with the consent of the
Holders of a majority in aggregate principal amount of the Notes at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to
waive compliance by the Company with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such

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consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder
and upon all future Holders of this Note and of any Note issued upon the registration of transfer
thereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Note.

     No reference herein to the Indenture and provisions of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the
principal of (and premium, if any) and interest on this Note at the times, place and rate, and in
the coin or currency, as herein prescribed.

     As provided in the Indenture and subject to certain limitations on transfer of this Note by
DTC or its nominee, the transfer of this Note is registrable in the Security Register, upon
surrender of this Note for registration of transfer at the office or agency of the Company in the
Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by a written
instrument of transfer in the form attached hereto duly executed by the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, shall be issued to the designated
transferee or transferees.

     The Notes are issuable only in registered form in minimum denominations of $2,000 and integral
multiples of $1,000 thereafter. As provided in the Indenture and subject to certain limitations
therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of
different authorized denomination, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or exchange of Notes,
but the Company may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

     Prior to due presentment of this Note for registration of transfer, the Company, the Trustee
and any agent of the Company, or the Trustee may treat the Person in whose name this Note is
registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of
the Company, the Trustee or any such agent shall be affected by notice to the contrary.

     Interest on this Note shall be computed on the basis of a 360-day year of twelve 30-day
months.

     The Company shall furnish to any Holder of record of Notes, upon written request and without
charge, a copy of the Indenture.

     The Indenture and this Note each shall be governed by and construed in accordance with the
laws of the State of New York without regard to principles of conflicts of law.

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

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     In Witness Whereof, Lowe’s Companies, Inc. has caused this Note to be signed by a
duly elected or appointed, qualified and serving officer and attested by a duly elected or
appointed, qualified and serving officer.

	 	 	 	 	 	 	 

	 	 	Lowe’s Companies, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

Dated: November 22, 2010

	 	 	 	 	 

	Attest:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

     This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture. 

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

 	 
	 	By:  	 	 
	 	 	Authorized Officer 	 
	 	 	 	 
	 

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ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of this Note, shall be
construed as though they were written out in full according to applicable laws or regulations:

TEN COM — tenants in common

TEN ENT — tenants by the entireties

JT TEN — joint tenants with right of survivorship and not as tenants
in common

CUST — Custodian

U/G/M/A or UNIF GIFT MIN ACT — Uniform Gifts to Minors Act

Additional abbreviations may also be used though not in the above
list.

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FORM OF TRANSFER

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

 
 (Please print or typewrite name and address of assignee)

 
(Please insert Social Security or other identifying Number of Assignee)

the within Note of Lowe’s Companies, Inc. and does hereby irrevocably constitute and appoint
                                                    
          
                                          
                , Attorney,
to transfer the said Note on the books of the within named Lowe’s
Companies, Inc., with full power of substitution in the premises.

Dated:                                        

 

NOTICE: The signature to this assignment must correspond with the name as

written upon the face of this Note in every particular without alteration or

enlargement or any change whatever.

 
SIGNATURE GUARANTEED:

The signature must be guaranteed by a member of the Securities Transfer Agents
Medallion Program. Notarized or witnessed signatures are not acceptable.

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PAYMENT INSTRUCTIONS

     The assignee should include the following for purposes of payment:

Payment shall be made, by wire transfer or otherwise, in immediately available funds, to                                         , for the account of                                         , account
number                     , or, if mailed by check, to                     . Applicable reports and statements required to be physically delivered under the terms
of the Indenture should be mailed to
                    . This information is provided by                                                             , the assignee named above, or                                                             , as its agent.

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