Document:

Exhibit 10.5

 

MADISON BANK OF MARYLAND 

CHANGE IN CONTROL SEVERANCE PLAN

 

1.           Purpose
of the Plan.  The purpose of the Madison Bank of Maryland Change in Control Employee Severance Plan (the
“Plan”) is to assure for the Bank the services of Covered Employees in the event of a Change in Control (capitalized
terms are defined in Section 3 of this Plan) of the Bank and its affiliates. The benefits contemplated by the Plan recognize the
value to the Bank of the services and contributions of the Covered Employees and the effect upon the Bank resulting from the uncertainties
of continued employment, reduced employee benefits, management changes and relocations that may arise in the event of a Change
in Control. The Board of Directors of the Bank believes that it is in the best interests of the Bank and the Company to provide
the Covered Employees with such benefits in order to defray the costs and changes in employee status that could follow a Change
in Control. The Board of Directors of the Bank believes that the Plan will also aid the Bank in attracting and retaining highly
qualified individuals who are essential to its success and the Plan’s assurance of fair treatment of the Covered Employees
will reduce the distractions and other adverse effects on job performance in the event of a Change in Control.

 

2.           Effective
Date of Plan.  This Plan will become effective upon the closing of the Bank’s mutual to stock conversion.

 

3.           Definitions.  Whenever
used herein, the following terms shall have the meanings set forth below:

 

		a.	“Affiliate” means any corporation, trade or business, which, at the time of reference, is
together with the Bank, a member of a controlled group of corporations, a group of trades or businesses (whether or not incorporated)
under common control, or an affiliated service group, as described in Sections 414(b), 414(c), and 414(m) of the Code, respectively,
or any other organization treated as a single employer with the Bank under Section 414(o) of the Code; provided, however, that,
where the context so requires, the term “Affiliate” shall be construed to give full effect to the provisions of Sections
409(l)(4) and 415(h) of the Code.

 

		b.	“Bank” means Madison Bank of Maryland, or any successor thereto.

 

		c.	“Base Pay”
means

 

		(i)	For salaried employees, an employee’s annual base salary at the rate in effect on his or
her termination date or, if greater, the rate in effect on the date immediately preceding the Change in Control.

 

		(ii)	For employees whose compensation is determined in whole or in part on the basis of commission income,
an employee’s base salary as of his or her

 

    	 

    	 

    

 

termination date (or, if greater, the
employee’s base salary on the date immediately preceding the effective date of the Change in Control), if any, plus the commissions
earned by the employee in the twelve (12) full calendar months preceding his termination of employment (or, if greater, the commissions
earned in the twelve (12) full calendar months immediately preceding the effective date of the Change in Control).

 

		(iii)	For hourly employees, an employee’s total hourly wages for the twelve (12) full calendar
months preceding his termination of employment or, if greater, the twelve (12) full calendar months preceding the effective date
of the Change in Control.

  

		d.	“Change in Control”  means a change in control of the Company or the
Bank as defined in Internal Revenue Section 409A of the Code and rules, regulations, and guidance of general application thereunder
issued by the Department of the Treasury, including a “change in ownership,” “change in effective control”
or “change in ownership of a substantial portion of assets.”

 

		e.	“Code” shall mean the Internal Revenue Code of 1986, as amended and the regulations promulgated thereunder.

 

		f.	“Company” means MB Bancorp, Inc. or any successor thereto.

 

		g.	“Comparable Position” means a position which (A) requires skills and knowledge similar to those required
in the Covered Employee’s position immediately prior to the Change in Control and (B) involves a work schedule that is substantially
similar to the work schedule followed by the Covered Employee immediately prior to the Change in Control. A position shall not
fail to be a Comparable Position solely as a result of a change following a Change in Control in the Covered Employee’s (A)
title, (B) supervisory authority or (C) reporting responsibilities.

 

		h.	“Covered Employee” means any employee of the Bank or the Company with a Year of Service as of the
effective date of a Change in Control, excluding any person who is covered by an employment contract, change in control or severance
agreement with the Company or any Affiliate at the time of the Change in Control.

 

		i.	“Designated Officer” means a Covered Employee who is an officer of the Bank with a title of assistant
vice president or higher that does not have an employment, change in control or other agreement that provides a severance benefit.

 

		j.	“Just Cause,” with respect to termination of employment, means an act or acts of personal dishonesty,
incompetence, willful misconduct, breach of

 

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fiduciary duty involving personal profit,
failure to perform stated duties, willful violation of any law, rule, or regulation (other than traffic violations or similar offenses)
or final cease-and-desist order. In determining incompetence, acts or omissions shall be measured against standards generally prevailing
in the banking industry, as determined by the Board of Directors of the Bank or the Company in its sole discretion.

 

		k.	“Year of Service” means each 12-month period of continuous employment with the Company or an Affiliate
following an employee’s date of hire during which the employee completes at least one hour of service each month. The taking
of a leave of absence does not eliminate a period of time from being a Year of Service if the period of time otherwise qualifies
as a year of service. A “leave of absence” means: (i) the taking of an authorized or approved leave of absence under
federal or state family and medical leave laws or (ii) active military leave. For purposes of determining a benefit under this
Plan, partial years will be rounded up to the nearest whole Year of Service.

 

4.           Severance
Benefit.  A Covered Employee shall be entitled to a severance benefit under this Plan, subject to the conditions
and limitations set forth in Sections 6 and 8 of this Plan, if his or her employment is terminated under the terms and conditions
set forth in Section 5 of this Plan.

 

		a.	All Covered Employees, other than the Covered Employees who are Designated Officers, shall be entitled to receive a severance
benefit equal to the product of: (i) the Covered Employee’s Years of Service through his or her date of termination and (ii)
two (2) week’s Base Pay. Notwithstanding the foregoing, the minimum severance benefit under this Section 4(a) shall be four
(4) week’s Base Pay and the maximum severance benefit shall be twenty-six (26) week’s Base Pay.

 

		b.	A Designated Officer shall be entitled to a severance benefit equal to one (1) times his or her Base Pay (regardless of Years
of Service) if within three (3) months before a Change in Control or one (1) year thereafter the Company, the Bank or a successor
to the Company or the Bank terminates the Designated Officer’s employment for any reason other than Just Cause or the Designated
Officer terminates his or her employment with the Bank and/or Company following the occurrence of an event described in Section
5(a),(b) (c) or (d) of the Plan.

 

		c.	All severance payments shall be made in a single lump sum payment, less applicable tax withholdings, payable in the payroll
period following the termination of employment, unless delayed under Section 13 of this Plan.

 

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		d.	Notwithstanding the provisions of paragraph a or b above, if a severance benefit payment to a Covered Employee who is a “Disqualified
Individual” shall be in an amount which includes an “Excess Parachute Payment,” when taken together with any
other payments or benefits that are paid or provided to the Covered Employee, the payment to that Covered Employee shall be reduced
to the maximum amount which does not include an Excess Parachute Payment. The terms “Disqualified Individual” and “Excess
Parachute Payment” shall have the same meanings as defined in Section 280G of the Internal Revenue Code of 1986, as amended,
or any successor provision thereto.

 

		e.	Covered Employees shall not be required to mitigate damages on the amount of their severance benefits by seeking other employment
or otherwise, nor shall the amount of such severance benefit be reduced by any compensation earned by the Covered Employee as a
result of employment after termination of employment hereunder.

 

5.           Termination
of Employment A Covered Employee (other than a Covered Employee who is a Designated Officer) shall be entitled to a severance
benefit under Section 4 of this Plan if within three (3) months before a Change in Control or one (1) year thereafter his or her
employment is involuntarily terminated for reasons other than Just Cause or voluntarily terminated by the Covered Employee upon
the occurrence of any one or more of the following events:

 

		a.	A reduction in the Covered Employee’s Base Pay.

 

		b.	Failure to offer the Covered Employee a Comparable Position.

 

		c.	The Bank or the Company requires the Covered Employee to change the location of his or her job or office, so that the Covered
Employee will be based at a location more than thirty-five (35) miles from the location of his or her job or office immediately
prior to the Change in Control provided that such new location is not closer to the Covered Employee’s home; or

 

		d.	A successor to the Bank fails or refuses to assume the Bank's obligations under this Plan, as required under Section 14 of
this Plan.

 

6.           Written
Acknowledgment.  As a condition to receiving any payments pursuant to Section 4 of this Plan, the Covered Employee
shall deliver to the Company or any applicable Affiliate no later than the 46th calendar day following the date of his
or her employment termination, and shall not revoke, a general release of all claims in a form provided by the Company which includes
an acknowledgment signed by the Covered Employee stating (i) that the severance payment to be made to the Covered Employee pursuant
to Section 4 of this Plan is in full and complete satisfaction of all liabilities and obligations of the Company and its Affiliates,
directors, officers, employees and agents, except for any tax-qualified plan benefits

 

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that may be due and owing and except for any liabilities or obligations
that may be required by law, and (ii) that the Company or any Affiliate shall not have any other liabilities or obligation to the
Covered Employee relating to the Covered Employee’s employment by the Company or any Affiliate.

 

7.            Legal
Fees and Expenses.  All reasonable legal fees and other expenses paid or incurred by a party hereto pursuant
to any dispute or question of interpretation relating to this Plan shall be paid or reimbursed by the prevailing party in any legal
judgment, arbitration or settlement.

 

8.            Required
Provisions.

 

a.           If
a Covered Employee is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s
affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1818(e)(3)
or (g)(1), the Bank’s obligations under this Agreement shall be suspended as of the date of service, unless stayed by appropriate
proceedings. If the charges in the notice are dismissed, the Bank may, in its discretion: (i) pay the Covered Employee all or part
of the compensation withheld while its obligations under the Plan were suspended; and (ii) reinstate (in whole or in part) any
of the obligations which were suspended.

 

b.           If
the Covered Employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by
an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1818(e)(4) or (g)(1),
all obligations of the Bank to the Covered Employee under this Plan shall terminate as of the effective date of the order, but
vested rights of the contracting parties shall not be affected.

 

c.           If
the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1813(x)(1), all obligations
under this Plan shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting
parties.

 

d.           All
obligations under this Plan shall terminate, except to the extent determined that continuation of the Plan is necessary for the
continued operation of the Bank: (i) by the Comptroller of the Currency, or his or her designee (the “Comptroller”),
at the time the Federal Deposit Insurance Corporation (FDIC) enters into an agreement to provide assistance to or on behalf of
the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1823(c), or (ii)
by the Comptroller at the time the Comptroller approves a supervisory merger to resolve problems related to the operations of the
Bank or when the Bank is determined by the Comptroller to be in an unsafe or unsound condition. Any rights of the parties that
have already vested, however, shall not be affected by such action.

 

e.           Any
payments made to a Covered Employee pursuant to this Plan, or otherwise, are subject to and conditioned upon their compliance with
12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

 

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f.            The
Plan shall not be funded. The Company or Bank, may, but shall not be required to set aside or earmark an amount necessary to provide
the severance benefits described herein.

 

9.           Administrative
Provisions.

 

		a.	The administrator of the Plan shall be under the supervision of the Board of Directors of the Bank or a committee appointed
by the Board of Directors of the Bank (the “Board”). It shall be a principal duty of the Board to see that the Plan
is carried out in accordance with its terms, for the exclusive benefit of persons entitled to participate in the Plan without discrimination
among them. The Board will have full power to administer the Plan subject, however, to the applicable requirements of ERISA. For
this purpose, the Board’s powers will include, but will not be limited to, the following authority, in addition to all other
powers provided by this Plan: (i) to make and enforce such rules and regulations as it deems necessary or proper for the efficient
administration of the Plan; (ii) to interpret the Plan, its interpretation thereof in good faith to be final and conclusive
on all persons claiming benefits under the Plan; (iii) to decide all questions concerning the Plan and the eligibility of any person
to participate in the Plan; (iv) to compute the amount of severance benefits payable to any Covered Employee or other person in
accordance with the provisions of the Plan, and to determine the person or persons to whom such benefits will be paid; (v) to authorize
severance benefits; (vi) to appoint such agents, counsel, accountants, consultants and actuaries as may be required to assist in
administering the Plan; and (vii) to allocate and delegate its responsibilities under the Plan and to designate other persons to
carry out any of its responsibilities under the Plan, any such allocation, delegation or designation to be by written instrument
and in accordance with Section 405 of ERISA, if applicable.

 

		b.	The Board will be a “named fiduciary” for purposes of Section 402(a)(1) of ERISA with authority to control and
manage the operation and administration of the Plan, and will be responsible for complying with all of the applicable reporting
and disclosure requirements of Part 1 of Subtitle B of Title I of ERISA.

 

10.         Claims
and Review Procedures.

 

		a.	If any person believes he is being denied any rights or benefits under the Plan, such person may file a claim in writing with
the Board. If any such claim is wholly or partially denied, the Board will notify such person of its decision in writing. Such
notification will be written in a manner calculated to be understood by such person and will contain (i) specific reasons for the
denial, (ii) specific reference to pertinent Plan provisions,

 

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(iii) a description of any additional
material or information necessary for such person to perfect such claim and an explanation of why such material or information
is necessary and (iv) information as to the steps to be taken if the person wishes to submit a request for review. Such notification
will be given within 90 days after the claim is received by the Board (or within 180 days, if special circumstances require an
extension of time for processing the claim, and if written notice of such extension and circumstances is given to such person within
the initial 90 day period). If such notification is not given within such period, the claim will be considered denied as of the
last day of such period and such person may request a review of his claim.

 

		b.	Within 60 days after the date on which a person receives a written notice of a denied claim (or, if applicable, within 60 days
after the date on which such denial is considered to have occurred) such person (or his duly authorized representative) may (i)
file a written request with the Board for a review of his denied claim and of pertinent documents and (ii) submit written issues
and comments to the Board. The Board will notify such person of its decision in writing. Such notification will be written in a
manner calculated to be understood by such person and will contain specific reasons for the decision as well as specific references
to pertinent Plan provisions. The decision on review will be made within 60 days after the request for review is received by the
Board (or within 120 days, if special circumstances require an extension of time for processing the requests such as an election
by the Board to hold a hearing, and if written notice of such extension and circumstances is given to such person within the initial
60 day period). If the decision on review is not made within such period, the claim will be considered denied.

 

11.         Governing
Law.  Unless preempted by federal law, this Plan shall be governed by the laws of the State of Maryland.

 

12.         Termination
or Amendment.  This Plan may be amended or terminated at any time, in the full discretion of the Board of Directors
of the Bank, prior to the Change in Control. This Plan may not be terminated or amended at the time of or after the occurrence
of the Change in Control.

 

13.         Payment
Delay Under Section 409A.  If when termination of employment occurs a Covered Employee is a “specified
employee” (within the meaning of Section 409A of the Code), and if the cash severance payment under Section 4 would be considered
deferred compensation under Section 409A of the Code, and, finally, if an exemption from the six-month delay requirement of Section
409A(a)(2)(B)(i) of the Code is not available, the Covered Employee’s severance benefit shall be paid to the employee in
a single lump sum, without interest, on the first payroll date of the seventh month after the month in which the Covered Employee’s
employment terminates, provided the termination of employment constitutes a

 

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“separation from service” under Section 409A of the
Code. References in this Plan to Section 409A of the Code include rules, regulations, and guidance of general application issued
by the Department of the Treasury under Section 409A of the Code.

 

14.         Successors.    
The Bank and the Company shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation
or otherwise, to all or substantially all the business or assets of the Bank and/or the Company, expressly and unconditionally
to assume and agree to perform the obligations under this Plan, in the same manner and to the same extent that the Bank or the
Company would be required to perform if no such succession or assignment had taken place.

 

This Plan has been approved and adopted by the
Board of Directors of the Bank as of September 9, 2014, subject to regulatory approval.

 

	ATTEST:	 	MADISON BANK OF MARYLAND
	 	 	 	 
	 	 	By:	 
	 	 	 	For the Entire Board of Directors

 

    	8Exhibit 10.1(a)

 

Commercial Paper Dealer Agreement

 

4(a)(2) Program

 

Between:

 

Ecolab Inc., as Issuer

 

and

 

[                     ], as Dealer

 

Concerning Notes to be issued pursuant to an Issuing and Paying Agent Agreement dated as of September 22, 2014 between the Issuer and Deutsche Bank Trust Company Americas, as Issuing and Paying Agent.

 

Dated as of

September 22, 2014

 

Commercial Paper Dealer Agreement

4(a)(2) Program

 

This agreement (“Agreement”) sets forth the understandings between the Issuer and the Dealer, each named above, in connection with the issuance and sale by the Issuer of its short-term promissory notes (the “Notes”) through the Dealer.

 

Certain terms used in this Agreement are defined in Section 6 hereof.

 

The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof.

 

1.                            Offers, Sales and Resales of Notes.

 

1.1                     While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein.

 

 

1.2                     So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to those contained in Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which have executed agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement.  In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2.

 

1.3                     The Notes shall be in a minimum denomination of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 270 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic “rollover.”

 

1.4                     The authentication and issuance of, and payment for, the Notes shall be effected in accordance with the Issuing and Paying Agent Agreement, and the Notes shall be either individual physical certificates or book-entry notes evidenced by a Master Note registered in the name of DTC or its nominee, in the form or forms annexed to the Issuing and Paying Agent Agreement.

 

1.5                     If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer’s services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agent Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuing and Paying Agent, for the account of the Issuer.  Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book-entry Note.  If such failure occurred for any reason other than default by the Dealer, the Issuer shall reimburse the Dealer on an equitable basis for the Dealer’s loss of the use of such funds for the period such funds were credited to the Issuer’s account.

 

1.6                     The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes:

 

(a)                        Offers and sales of the Notes by or through the Dealer shall be made only to: (i) investors reasonably believed by the Dealer to be Qualified Institutional Buyers or Institutional Accredited Investors and (ii) non-bank fiduciaries or agents that are Institutional Accredited Investors purchasing Notes for one or more accounts, each of which is reasonably believed by the Dealer to be an Institutional Accredited Investor.

 

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(b)                        Resales and other transfers of the Notes by the holders thereof shall be made only in accordance with the restrictions in the legend described in clause (e) below.

 

(c)                         No general solicitation or general advertising shall be used in connection with the offering of the Notes.  Without limiting the generality of the foregoing, no party shall issue any press release or place or publish any “tombstone” or other advertisement relating to the Notes without the prior written consent of the other party hereto.

 

(d)                        No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount.  If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes.

 

(e)                         Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Section 4(a)(2) of the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto.  A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each individual certificate representing a Note and each Master Note representing book-entry Notes offered and sold pursuant to this Agreement.

 

(f)                          The Dealer shall furnish or shall have furnished to each purchaser of Notes for which it has acted as the Dealer a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect.  The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained.

 

(g)                         The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15 (d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d) (4) (i) in compliance with Rule 144A(d).

 

(h)                        In the event that any Note offered or to be offered by the Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify the Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to the Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto.

 

(i)                            The Issuer represents that it is not currently issuing commercial paper in the United States market in reliance upon the exemption provided by Section 3(a)(3) of the Securities Act.  In that connection, the Issuer agrees that in the event that it shall, after the date hereof, issue commercial paper in the United States in reliance upon the exemption provided by Section 3(a)(3) of the Securities Act, (a) the proceeds from the

 

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sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Securities Act in selling commercial paper or other short-term debt securities other than the Notes in the United States.

 

1.7                     The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows:

 

(a)                        Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer, to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof.  The Issuer also agrees that (except as permitted by Section 1.6(i)), as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof, it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(a)(2) of the Securities Act and shall survive any termination of this Agreement.  The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties.

 

(b)                        In the event that the Issuer determines to use proceeds of the sale of the Notes for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer notice at least five business days’ prior to the actual date that it commences to purchase securities with the proceeds of the Notes.  Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes either (i) only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A or (ii) in a manner which would not cause a violation of Regulation T and the interpretations thereunder.

 

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2.                            Representations and Warranties of Issuer.

 

The Issuer represents and warrants that:

 

2.1                      The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agent Agreement.

 

2.2                      This Agreement and the Issuing and Paying Agent Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and subject to public policy limitations on indemnification obligations.

 

2.3                      The establishment of the commercial paper program contemplated hereby has been duly authorized.  When the Notes are issued as provided in the Issuing and Paying Agent Agreement, such Notes will be duly and validly issued and will constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

 

2.4                      The offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(a)(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended.

 

2.5                      The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer.

 

2.6                      No consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agent Agreement, except as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes.

 

2.7                      Neither the execution and delivery of this Agreement and the Issuing and Paying Agent Agreement, nor the issuance of the Notes in accordance with the Issuing and Paying Agent Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or a default under any of the terms of the Issuer’s charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government

 

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instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach, violation or default is reasonably likely to result in a material adverse change in the condition (financial or otherwise), operations or business prospects of the Issuer and its consolidated subsidiaries, taken as a whole, which would be material to the holders of Notes or to potential holders of Notes or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agent Agreement.

 

2.8                      Other than as set forth in the Company Information, there is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which is reasonably likely to result in a material adverse change in the condition (financial or otherwise), operations or business prospects of the Issuer or the ability of the Issuer and its consolidated subsidiaries, taken as a whole, which would be material to the holders of Notes or to potential holders of Notes to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agent Agreement.

 

2.9                      The Issuer is not an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

 

2.10               Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

2.11               Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the condition (financial or otherwise), operations or business prospects of the Issuer and its consolidated subsidiaries, taken as a whole, which would be material to the holders of Notes or to potential holders of Notes which has not been disclosed in the Company Information or to the Dealer in writing.

 

3.                            Covenants and Agreements of Issuer.

 

The Issuer covenants and agrees that:

 

3.1                      The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of or waiver with

 

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respect to, the Notes or the Issuing and Paying Agent Agreement, including a complete copy of any such amendment, modification or waiver.

 

3.2                      The Issuer shall, whenever there shall occur any adverse change in the Issuer’s condition (financial or otherwise), operations or business prospects or any development or occurrence in relation to the Issuer that would be material to holders of the Notes or potential holders of the Notes (including any downgrading or receipt of any notice of intended or potential downgrading or any review for potential change in the rating accorded any of the Issuer’s securities by any nationally recognized statistical rating organization which has published a rating of the Notes), promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such change, development or occurrence.

 

3.3                      The Issuer shall from time to time furnish to the Dealer such information as the Dealer may reasonably request, including, without limitation, any press releases or material provided by the Issuer to any national securities exchange or rating agency, regarding (i) the Issuer’s operations and financial condition, (ii) the due authorization and execution of the Notes and (iii) the Issuer’s ability to pay the Notes as they mature.

 

3.4                      The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, however, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

 

3.5                      The Issuer will not be in default of any of its obligations hereunder, under the Notes or under the Issuing and Paying Agent Agreement, at any time that any of the Notes are outstanding.

 

3.6                      The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agent Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement, the Issuing and Paying Agent Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested.

 

3.7                      The Issuer shall reimburse the Dealer for all of the Dealer’s out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer’s counsel.

 

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3.8                      The Issuer shall not file a Form D (as referenced in Rule 503 under the Securities Act) at any time in respect of the offer or sale of the Notes.

 

3.9            Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, including, but not limited to, [Name of Affiliate] and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer.

 

3.10               (a) The parties hereto agree that the Issuer may, in accordance with the terms of this Section 3.10, from time to time replace the party which is then acting as Issuing and Paying Agent (the “Current Issuing and Paying Agent”) with another party (such other party, the “Replacement Issuing and Paying Agent”), and enter into an agreement with the Replacement Issuing and Paying Agent covering the provision of issuing and paying agency functions in respect of the Notes by the Replacement Issuing and Paying Agent (the “Replacement Issuing and Paying Agent Agreement”) (any such replacement, a “Replacement”).

 

(b)    From and after the effective date of any Replacement, (A) to the extent that the Issuing and Paying Agent Agreement provides that the Current Issuing and Paying Agent will continue to act in respect of Notes outstanding as of the effective date of such Replacement (the “Outstanding Notes”), then (i) the “Issuing and Paying Agent” for the Notes shall be deemed to be the Current Issuing and Paying Agent, in respect of the Outstanding Notes, and the Replacement Issuing and Paying Agent, in respect of Notes issued on or after the Replacement, (ii) all references to the “Issuing and Paying Agent” herein shall be deemed to refer to the Current Issuing and Paying Agent, in respect of the Outstanding Notes, and the Replacement Issuing and Paying Agent, in respect of Notes issued on or after the Replacement, and (iii) all references to the “Issuing and Paying Agent Agreement” herein shall be deemed to refer to the existing Issuing and Paying Agent Agreement, in respect of the Outstanding Notes, and the Replacement Issuing and Paying Agent Agreement, in respect of Notes issued on or after the Replacement; and (B) to the extent that the Issuing and Paying Agent Agreement does not provide that the Current Issuing and Paying Agent will continue to act in respect of the Outstanding Notes, then (i) the “Issuing and Paying Agent” for the Notes shall be deemed to be the Replacement Issuing and Paying Agent, (ii) all references to the “Issuing and Paying Agent” herein shall be deemed to refer to the Replacement Issuing and Paying Agent, and (iii) all references to the “Issuing and Paying Agent Agreement” herein shall be deemed to refer to the Replacement Issuing and Paying Agent Agreement.

 

(c)     From and after the effective date of any Replacement, the Issuer shall not issue any Notes hereunder unless and until the Dealer shall have received:  (i) a copy of the executed Replacement Issuing and Paying Agent Agreement, (ii) a copy of the executed Master Note authenticated by the Replacement Issuing and Paying Agent and registered in the name of DTC or its nominee, (iii) an amendment or supplement to the Private Placement Memorandum describing the Replacement Issuing and Paying Agent as the Issuing and Paying Agent for the Notes, and reflecting any other changes thereto necessary in light of the Replacement so that the Private Placement Memorandum, as amended or supplemented, satisfies the requirements of this Agreement, and (iv) a legal

 

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opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance reasonably satisfactory to the Dealer, as to (a) the due authorization, delivery, validity and enforceability of Notes issued pursuant to the Replacement Issuing and Paying Agent Agreement, and (b) such other matters as the Dealer may reasonably request.

 

4.                            Disclosure.

 

4.1                      The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer.  The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense.

 

4.2                      The Issuer agrees to promptly furnish the Dealer the Company Information as it becomes available.

 

4.3                      (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading.

 

(b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3 (a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to, at its option, either (i) supplement or amend the Private Placement Memorandum so that the Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer or (ii) purchase such Notes from the Dealer at a purchase price equal to the original issue price plus any accrued or accreted interest.

 

(c)     In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3 (a), (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer.

 

5.                          Indemnification and Contribution.

 

5.1                      The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, any affiliate of the Dealer or any such controlling entity and their respective directors, officers, employees, partners, incorporators, shareholders, servants, trustees and agents (hereinafter the

 

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“Indemnitees”) against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a “Claim”), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time) or includes an untrue statement of a material fact or omitted (as of any relevant time) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement.  This indemnification shall not apply to the extent that the Claim arises out of or is based upon Dealer Information.

 

5.2                      Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement.

 

5.3                      In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in this Section 5 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates.  The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder.

 

6.                            Definitions.

 

6.1                      “Claim” shall have the meaning set forth in Section 5.1.

 

6.2                      “Company Information” at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer’s most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer’s most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer’s and its affiliates’ other publicly available reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes.

 

6.3                      “Current Issuing and Paying Agent” shall have the meaning set forth in Section 3.10(a).

 

6.4                      “Dealer Information” shall mean material concerning the Dealer provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum.

 

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6.5                      “DTC” shall mean The Depository Trust Company.

 

6.6                      “Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, as amended.

 

6.7                      “Indemnitee” shall have the meaning set forth in Section 5.l.

 

6.8                      “Institutional Accredited Investor” shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3 (a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3 (a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity.

 

6.9                      “Issuing and Paying Agent Agreement” shall mean the issuing and paying agent agreement described on the first page of this Agreement, , or any replacement thereof, as such agreement may be amended or supplemented from time to time.

 

6.10               “Issuing and Paying Agent” shall mean the party designated as such on the first page of this Agreement, or any successor thereto or replacement thereof, as issuing and paying agent under the Issuing and Paying Agent Agreement.

 

6.11               “Non-bank fiduciary or agent” shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3 (a) (2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3 (a) (5) (A) of the Securities Act.

 

6.12               “Private Placement Memorandum” shall mean the private placement memorandum prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement).

 

6.13               “Qualified Institutional Buyer” shall have the meaning assigned to that term in Rule 144A under the Securities Act.

 

6.14               Replacement” shall have the meaning set forth in Section 3.10(a).

 

6.15               “Replacement Issuing and Paying Agent” shall have the meaning set forth in Section 3.10(a).

 

6.18.            “Replacement Issuing and Paying Agent Agreement” shall have the meaning set forth in Section 3.10(a).

 

6.19               “Rule 144A” shall mean Rule 144A under the Securities Act.

 

6.20               “SEC” shall mean the U.S. Securities and Exchange Commission.

 

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6.21               “Securities Act” shall mean the U.S. Securities Act of 1933, as amended.

 

7.                          General

 

7.1                      Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement.

 

7.2                      This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions.

 

7.3                      The Issuer agrees that any suit, action or proceeding brought by the Issuer against the Dealer in connection with or arising out of this Agreement or the Notes or the offer and sale of the Notes shall be brought solely in the United States federal courts located in the Borough of Manhattan or the courts of the State of New York located in the Borough of Manhattan.  Each of the Dealer and the Issuer waives its right to trial by jury in any suit, action or proceeding with respect to this Agreement or the transactions contemplated hereby.

 

7.4                      This Agreement may be terminated, at any time, by the Issuer, upon three business days’ prior notice to such effect to the Dealer, or by the Dealer upon three business days’ prior notice to such effect to the Issuer.  Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement.

 

7.5                      This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any affiliate of the Dealer.

 

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

 

7.7                      This Agreement is for the exclusive benefit of the parties hereto, and their respective permitted successors and assigns hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever.

 

7.8                      This Agreement shall supercede in its entirety the Commercial Paper Dealer Agreement dated as of [Date of Dealer Agreement] between the Issuer and the Dealer (the “Prior Agreement”) and the issuance and sale of Notes by the Issuer through the Dealer on and after the date hereof shall be governed by the provisions of this Agreement and not the Prior Agreement.

 

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

 

	
ECOLAB INC., as Issuer
    	
[DEALER NAME], as Dealer
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
Name: Ching-Meng Chew
    	
Name:
    
	
Title: Vice President and Treasurer
    	
Title:
    
					

 

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Addendum

 

The following additional clauses shall apply to the Agreement and be deemed a part thereof.

 

1.                            The other dealers referred to in clause (b) of Section 1.2 of the Agreement are the following:

 

·        Citigroup Global Markets, Inc.

·        Credit Suisse Securities (USA) LLC

·        Merrill Lynch, Pierce, Fenner & Smith Incorporated

·        J.P. Morgan Securities LLC

·        RBS Securities Inc.

·        Wells Fargo Securities, LLC

 

2.                                      The addresses of the respective parties for purposes of notices under Section 7.1 are as follows:

 

For the Issuer:

 

Address: 370 Wabasha Street North, St. Paul, Minnesota 55102

 

Attention:  Ching-Meng Chew, Vice President and Treasurer

 

Telephone number: 651-250-2938

 

Fax number: 651-306-5392

 

For the Dealer:

 

Address:

 

Attention:

 

Telephone number:

 

Fax number:

 

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Exhibit A

 

Form of Legend for Private Placement Memorandum and Notes

 

THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.  BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE COMPANY AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501 (a) UNDER THE ACT (AN “INSTITUTIONAL ACCREDITED INVESTOR”) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3 (a) (2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3 (a) (5) (A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN ASSOCIATION OR OTHER SUCH INSTITUTION) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR AND WITH RESPECT TO WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER (“QIB”) WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A.  BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO [DEALER NAME] OR ANOTHER PERSON DESIGNATED BY THE COMPANY AS A DEALER FOR THE NOTES (COLLECTIVELY, THE “DEALERS”), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A DEALER TO AN INSTITUTIONAL ACCREDITED INVESTOR OR A QIB, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000.

 

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Exhibit B

Further Provisions Relating to Indemnification

 

(a)              The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under Section 5 of the Agreement (whether or not it is a party to any such proceedings).

 

(b)              Promptly after receipt by an Indemnitee of notice of the existence of a Claim, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve the Issuer from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and such failure results in the forfeiture by the Issuer of substantial rights and defenses, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement.  In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer, and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee.  Upon receipt of notice from the Issuer to such Indemnitee of the Issuer’s election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee.  The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee.  The Issuer agrees that without the Dealer’s prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which indemnification may be sought under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim.

 

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