Document:

Ex-4.5

 

Exhibit 4.5

EXECUTION VERSION

 

FOURTH SUPPLEMENTAL INDENTURE

Dated as of October 10, 2006

 

between

LOWE’S COMPANIES, INC.

and

THE
BANK OF NEW YORK 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

5.40% Notes due 2016

and

Creating a Series of Securities designated

5.80% Notes due 2036

 

 

     FOURTH SUPPLEMENTAL INDENTURE, dated as of October 10, 2006 (this “Fourth 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 Trust
Company, N.A, a banking corporation 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”).

W I T N E S S E T H :

          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 Fourth 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 Fourth 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) 5.40% Notes due October 15, 2016 (the “2016 Notes”), in an aggregate Principal
Amount at Maturity of $550,000,000 and (ii) 5.80% Notes due October 15, 2036 (the “2036
Notes” and, together with the 2016 Notes, the “Notes”) in an aggregate Principal Amount
at Maturity of $450,000,000; 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 Fourth
Supplemental Indenture a valid 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 2036 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 Fourth
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
Fourth Supplemental Indenture have the meanings assigned to them in this Article. Each capitalized
term that is used in this Fourth 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.

          “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.

          “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

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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 Fourth
Supplemental Indenture.

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

          “Underwriting Agreement” means the Underwriting Agreement, dated October 3, 2006,
among the Company and Banc of America Securities LLC, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, and Wachovia Capital Markets.

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

          “Reference Treasury Dealer” means (i) Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Banc of America Securities LLC (or their respective affiliates that are Primary
Treasury Dealers) and their respective successors; provided, however, that if any of the foregoing
shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary
Treasury Dealer”), we will substitute therefor another Primary Treasury Dealer, and (ii) any
other Primary Treasury Dealer selected by us.

          “Reference Treasury Dealer Quotations” means, with respect to such Reference Treasury
Dealer and any redemption date, the average, as determined by the Trustee, 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 Fourth
Supplemental Indenture.

          “Stated Maturity” has the meaning set forth in Section 203 of this Fourth 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.

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

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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 2036
Notes, each as a separate series of its Securities issued pursuant to the Indenture. The 2016
Notes shall be designated as the “5.40% Notes due 2016,” and the 2036 Notes shall be designated as
the “5.80% Notes due 2036.”

     Section 202. Amount. The aggregate Principal Amount at Maturity of the 2016 Notes that may
be authenticated and delivered under this Fourth Supplemental Indenture is limited to $550,000,000,
and the aggregate Principal Amount at Maturity of the 2036 Notes that may be authenticated and
delivered under this Fourth Supplemental Indenture is limited to $450,000,000.

     Section 203. Stated Maturity. The Stated Maturity of the 2016 Notes shall be October 15,
2016, and the Stated Maturity of the 2036 Notes shall be October 15, 2036.

     Section 204. Interest and Payment.

     (a) The 2016 Notes shall bear interest at 5.40% per annum, and the 2036 Notes shall bear
interest at 5.80% 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, 2007, 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”).

     (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) The 2016 Notes and/or the 2036 Notes, as the case may be, 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 2036 Notes to be
redeemed; or

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     (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
with respect to the 2016 Notes, and 20 basis points with respect to the 2036 Notes,

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

     (b) 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
2036 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. Forms; Denominations. The Notes shall be Registered Securities and shall be
issued in denominations of $1,000 or any integral multiple thereof. 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 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.

     (ii) Book-Entry Provisions. The Company shall execute and the Trustee shall, in
accordance with this Section 206(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

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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 207. Applicability of Reports by Company. For purposes of this Fourth
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 208. Applicability of Sinking Funds. The provisions of Article Twelve of the
Base Indenture shall not apply to the 2016 Notes or the 2036 Notes.

     Section 209. 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 2036
Notes.

     Section 210. Applicability of Conversion of Securities. The provisions of Article
Fourteen of the Base Indenture shall not apply to the 2016 Notes or the 2036 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
Base Indenture is in all respects hereby ratified and confirmed. This Fourth 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 Fourth 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 Fourth 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.

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     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 Fourth Supplemental Indenture.

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

     Section 306. Multiple Originals. This Fourth 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.

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          IN WITNESS WHEREOF, the parties have caused this Fourth 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 TRUST COMPANY, N.A., as Trustee

 	 
	 	By:  	/s/
Tina D. Gonzalez 	 
	 	 	Name:  	Tina D. Gonzalez	 
	 	 	Title:  	Assistant Treasurer	 

 

 

	 	 	 	 	 

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.

5.40% Notes due October 15, 2016

GLOBAL SECURITY

			
	 	 	 
	No. 1
	 	CUSIP No. 548661CK1
	 	 	 
	 
	 	$550,000,000
	 
	 	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 $550,000,000 on October 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 October 10, 2006, 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, 2007, at the rate of 5.40% 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 Trust Company, N.A., as trustee (the “Trustee”), as
supplemented by the Fourth Supplemental Indenture dated as of October 10, 2006, between the Company
and the Trustee (the “Fourth Supplemental Indenture” and, together with

A-1-1

 

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 $1,000 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 5.40% Notes
due 2016 (the “Notes”), limited in aggregate principal amount at any time outstanding to FIVE
HUNDRED FIFTY MILLION DOLLARS ($550,000,000) which may be issued under the Indenture. 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.

     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:

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     (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.
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.

     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.

     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, 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 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

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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 denominations of $1,000 and any integral
multiple thereof. 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: October 10, 2006

	 	 	 	 	 
	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 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.

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 nor 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.

5.80% Notes due October 15, 2036

GLOBAL SECURITY

			
	 	 	 
	No. 1
	 	CUSIP No. 548661CL9
	 	 	 
	 
	 	$450,000,000
	 
	 	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 $450,000,000 on October 15, 2036, 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 October 10, 2006, 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, 2007, at the rate of 5.80% 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 Trust Company,

A-2-1 

 

N.A., as trustee (the “Trustee”), as supplemented by the Fourth Supplemental Indenture dated
as of October 10, 2006, between the Company and the Trustee (the “Fourth 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 $1,000 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 5.80% Notes
due 2036 (the “Notes”), limited in aggregate principal amount at any time outstanding to FOUR
HUNDRED FIFTY MILLION DOLLARS ($450,000,000) which may be issued under the Indenture. 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-2-2 

 

     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:

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

     (iv) 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 20 basis points,

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

     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.

     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, 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 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.

A-2-3 

 

     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 denominations of $1,000 and any integral
multiple thereof. 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-2-4 

 

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: October 10, 2006

	 	 	 	 	 
	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 Trust Company, N.A.

as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Officer 	 
	 	 	 	 
	 

A-2-5 

 

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-2-6 

 

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 nor acceptable.
	 	 

A-2-7 

 

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-2-8Ex-10.1

 

Exhibit 10.1

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (“Agreement”), effective this 10th day of October, 2006
(“Effective Date”), is entered into by and between Jim Fox (“Executive”) and Pike Electric, Inc., a
North Carolina corporation (the “Company”) and, solely with respect to Section 4(b), Pike Electric
Corporation, a Delaware corporation.

     WHEREAS, Executive desires to provide the Company and certain of its subsidiaries with his
services, and the Company desires to employ Executive on the terms and subject to the conditions
set forth herein;

     NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and
agreements set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound,
agree as follows:

	 	1.	 	Employment. Subject to the terms and conditions of this Agreement,
the Company agrees to employ Executive, and Executive agrees to be employed by the
Company in the position of General Counsel and Vice President of Risk Management
retroactive to his first day of full-time work on September 18, 2006.
	 
	 	2.	 	Position. During the period of his employment hereunder, Executive
agrees to serve the Company, and the Company shall employ Executive, as General
Counsel, Corporate Secretary and Vice President of Risk Management, or in such other
executive capacity or capacities, at the same level of seniority, as may be determined
from time to time by the CEO of Pike Electric, Inc.
	 
	 	3.	 	At-Will Employment and Duties.

	 	(a)	 	Executive and the Company agree that Executive’s
employment hereunder will be at-will (as defined under applicable law), and
may be terminated at any time, for any reason, at the option of either
party, subject to the provisions of Section 5 below.
	 
	 	(b)	 	Duties. During the period of his employment
hereunder and except for illness, reasonable vacation periods, and
reasonable leaves of absence, Executive shall in good faith (i) devote all
of his business time, attention, skill and efforts to the business and
affairs of the Company and its affiliated companies and (ii) report to the
Chief Executive Officer of Pike Electric, Inc. (the “CEO”).

	 	4.	 	Salary; Incentive Bonus; Reimbursement of Expenses; Other Benefits.

	 	(a)	 	Salary. During the period of employment under
this Agreement, Executive shall be paid a salary at the rate of $325,000
(“Base Salary”) retroactive to his first day of full-time work on September
25, 2006. The Base Salary shall be reviewed

 

 

	 	 	 	annually and may be adjusted as determined by the Board of Directors of
Pike Electric, Inc. (the “Board”) (or any authorized committee thereof)
in consultation with the CEO.
	 
	 	(b)	 	Stock Options. Subject to approval by the Board,
Executive will be granted options to purchase up to 30,000 shares of common
stock Options of Pike Electric Corporation, and be granted 5,000 shares of
restricted Pike Electric Corporation stock. Stock Options vest 20% per year
for 5 years and restricted stock cliff vests at 5 years. He will also be
eligible for future grants in accordance with any future Pike Incentive Plan
and form of stock option agreement as the Board of Directors of Pike
Electric Corporation, or any authorized committee thereof in its sole
discretion may determine from time to time in consultation with the CEO.
	 
	 	(c)	 	Reimbursement of Expenses. The Company shall pay
or reimburse Executive, in accordance with its normal policies and
practices, for all reasonable travel and other expenses incurred by
Executive in performing his obligations under this Agreement.
	 
	 	(d)	 	Other Benefits. During the period of employment
under this Agreement, Executive shall be entitled to participate in all
other benefits of employment generally available to other executives of the
Company and those benefits for which such persons are or shall become
eligible, when and as he becomes eligible therefore (including but not
limited to any deferred compensation plan and 401(k) plan).

	 	5.	 	Termination of Employment.

	 	(a)	 	Termination by the Company for Cause. The
Company may terminate Executive’s employment under this Agreement for
“Cause” (as hereinafter defined) or otherwise at will at any time
immediately upon written notice, or where applicable, upon Executive’s
failure to cure the breach as provided below, whereupon the Company shall
have no further obligation hereunder to Executive, except for payment of
amounts of Base Salary accrued through the termination date. For purposes
of this agreement, “Cause” shall mean: (i) the continued willful failure by
Executive to substantially perform his duties with the Company, (ii) the
willful engaging by Executive in gross misconduct materially and
demonstrably injurious to the Company or (iii) Executive’s material breach
of Sections 3, 6 or 7 of this Agreement; provided, that with respect to any
breach that is curable by Executive, as determined by the Board in good
faith, the Company has provided Executive written notice of the material
breach and Executive has not cured such breach, as determined by the Board
in good faith, within fifteen (15) days following the date the Company
provides such notice.

 

 

	 	(b)	 	Termination as a Result of Executive’s Death or
Disability. If Executive’s employment hereunder is terminated by reason
of Executive’s Disability (as hereinafter defined) or death, Executive’s (or
Executive’s estate’s) right to benefits under this Agreement will terminate
as of the date of such termination and all of the Company’s obligations
hereunder shall immediately cease and terminate, except that Executive or
Executive’s estate, as the case may be, will be entitled to receive accrued
Base Salary and benefits through the date of termination. As used herein,
Executive’s Disability shall have the meaning set forth in any long-term
disability plan in which Executive participates, and in the absence thereof
shall mean that, due to physical or mental illness, Executive shall have
failed to perform his duties on a full-time basis hereunder for one hundred
eighty (180) consecutive days and shall not have returned to the performance
of his duties hereunder on a full-time basis before the end of such period,
and if Disability has occurred termination shall occur within thirty (30)
days after written notice of termination is given (which notice may be given
before the end of the one hundred eighty (180) day period described above so
as to cause termination of employment to occur as early as the last day of
such period).
	 
	 	(c)	 	Termination by Executive for Good Reason or by the
Company other than as a Result of Executive’s Death or Disability or other
than for Cause.

	 	(i)	 	If Executive’s employment is terminated by Executive for
“Good Reason” (as hereinafter defined) or by the
Company for any reason other than Executive’s death
or Disability or other than for Cause, subject to
Executive entering into and not revoking a release of
claims in favor of the Company and abiding by the
non-competition provision set forth in Section 6(b),
Executive shall be entitled to the following
benefits:

	 	1)	 	Cash severance payments equal in the aggregate to twelve
(12) months of Executive’s annual Base Salary at the
time of termination, payable in twelve (12) equal
monthly installments beginning at the end of the
first full month following termination of employment.
	 
	 	2)	 	Continuation of Executive’s medical and health
insurance benefits for a period equal to the lesser
of (i) twelve (12) months, or (ii) the period ending
on the date Executive first

 

 

	 	 	 	becomes entitled to medical and health insurance
benefits under any plan maintained by any person
for whom Executive provides services as an
employee or otherwise.

	 
	 	(ii)	 	For purposes of this Agreement, “Good
Reason” shall mean: (a) a material reduction (without Executive’s express written consent) in
Executive’s title or responsibilities; (b) the requirement that Executive relocate to an employment
location that is more than 50 miles from his employment location on the Effective Date; or (c) the
Company’s material breach (without Executive’s express written consent) of Sections 2 or 4 of this
Agreement; provided, that Executive has provided the Company written notice of the material breach
and the Company has not cured such breach within fifteen (15) days following the date Executive
provides such notice. If the Company thereafter intentionally repeats the breach it previously
cured, such breach shall no longer be deemed curable.

	 	(d)	 	Termination by Executive other than for Good
Reason. Executive may terminate his employment with the Company other than for Good Reason upon thirty (30)
days written notice to the Company, after which the Company shall have no further obligation
hereunder to Executive, except for payment of amounts of Base Salary and other benefits accrued
through the termination date,

	 	6.	 	Confidential Information, Non Competition; Non-Solicitation.

          (a) Confidential Information. Executive acknowledges that in his
employment hereunder he will occupy a position of trust and confidence. Executive shall not,
except in the course of the good faith performance of his duties hereunder or as required by
applicable law, without limitation in time or until such information shall have become public other
than by Executive’s unauthorized disclosure, disclose to others or use, whether directly or
indirectly, any Confidential Information regarding the Company, its subsidiaries and affiliates.
“Confidential Information” shall mean information about the Company, its subsidiaries or
affiliates, or their respective clients or customers that was learned by Executive in the course of
his employment by the Company, its subsidiaries or affiliates, or their respective clients or
customers that was learned by Executive in the course of his employment by the Company, its
subsidiaries or affiliates, including (without limitation) any proprietary knowledge, trade
secrets, data, formulae, information and client and customer lists and all papers, resumes, and
records (including computer records) of the documents containing such Confidential Information,
but excludes information (i) which is in the public domain through no unauthorized act or omission
of Executive; or (ii) which becomes available to Executive on a non-confidential basis from a
source other than the Company or its affiliates without breach of such source’s confidentiality or
non-disclosure obligations to the Company or any affiliate. Executive agrees to deliver or return
to the Company, at the Company’s request at any time or upon termination or expiration of his
employment or as soon thereafter as possible, (A) all documents, computer tapes and disks, records,
lists, data, drawings, prints, notes and written information (and all copies thereof) furnished by
the Company, its subsidiaries or affiliates, or prepared by Executive during the term of his
employment

 

 

by the Company, its subsidiaries or affiliates, and (B) all notebooks and other data relating to
research or experiments or other work conducted by Executive in the scope of employment.

          (b) Non-Competition. During the period of Executive’s employment by the Company and
for a period of twelve (12) months after the date of termination of his employment or for the
period of one additional year thereafter if so elected by the Company pursuant to Section 6. (d)
below, Executive shall not, directly or indirectly, without the prior written consent of the
Company, provide consultative services or otherwise provide services to (whether as an employee or
a consultant, with or without pay) or, own, manage, operate, join, control, participate in, or be
connected with (as a stockholder, partner, or otherwise), any business, individual, partner, firm,
corporation, or other entity that is then a competitor of the Company, its subsidiaries or
affiliates (each such competitor a “Competitor of the Company”); provided, however,
that the “beneficial ownership” by Executive, either individually or as a member of a “group,” as
such terms are used in Rule 13d of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), of not more than five percent (5%) of the voting
stock of any publicly held corporation shall not alone constitute a violation of this Agreement.
Executive and the Company acknowledge and agree that the business of the Company extends throughout
the United States, and that the terms of the non-competition agreement set forth herein shall apply
on a nationwide basis throughout the United States.

          (c) Non-Solicitation of Customer and Suppliers. During the period of Executive’s
employment by the Company and, if Executive’s employment is terminated under Sections 5 above (and
provided the Company fulfills its obligations there under) until the twelfth month of the date of
Executive’s employment termination or for the period of one additional year thereafter if so
elected by the Company pursuant to Section 6. (d) below, Executive shall not, directly or
indirectly, influence or attempt to influence customers or suppliers of the Company or any of its
subsidiaries or affiliates to divert any of their business to any Competitor of the Company.

          (d) Extension of Periods of Non-competition and Non-solicitation.
At the sole election of the Company, it may extend the periods of non-competition and
non-solicitation as set forth in Paragraphs (b), (c) and (d) of this Section for an additional
twelve (12) months (to two years in total) for the following consideration to the Executive: in the
case of termination under Section 5 (a) and (d) by providing severance as set forth in Section 5.
(c) (i), and in the case of termination under Section 5. (c) by providing severance as set forth
therein for an additional twelve (12) month period.

          (e)
Non-Solicitation of Employees. Executive recognizes that he possesses and will
posses Confidential Information about other employees of the Company, its subsidiaries or
affiliates, relating to their education, experience, skills, abilities, compensation and benefits,
and inter-personal relationships with customers of the Company, its subsidiaries or affiliates.
Executive recognizes that the information he possesses and will possess about these other employees
is not generally known, is of substantial value to the Company, its subsidiaries or affiliates in
developing their business and in securing and retaining customers, and has been and will be
acquired by him because of his business position with the Company, its subsidiaries or affiliates.

 

 

Executive agrees that, during the period of Executive’s employment by the Company and for a period
of one (1) year thereafter, he will not, directly or indirectly, solicit, recruit, induce or
encourage or attempt to solicit, recruit, induce, or encourage any employee of the Company, its
subsidiaries or affiliates (i) for the purpose of being employed by him or by any Competitor of the
Company on whose behalf he is acting as an agent, representative or employee or (ii) to terminate
his or her employment or any other relationship with the Company, its subsidiaries, or affiliates.
Executive also agrees that Executive will not convey any such Confidential Information or trade
secrets about other employees of the Company, its subsidiaries, or affiliates to any other person.

          (f) Injunctive Relief. It is expressly agreed that the Company will or would suffer
irreparable injury if Executive were to violate any of the provisions of this Section 6 and that
the Company would by reason of such violation be entitled to injunctive relief in a court of
appropriate jurisdiction, and Executive further consents and stipulates to the entry of such
injunctive relief in such a court prohibiting Executive from so violating Section 6 of this
Agreement.

          (g) Survival of Provisions. The obligations contained in this Section 6 shall survive
the termination or expiration of Executive’s employment with the Company and shall be fully
enforceable thereafter.

     7. No Conflict. Executive represents and warrants that Executive is not
subject to any agreement, instrument, order judgment or decree of any kind, or any other
restrictive agreement of any character, which would prevent Executive from entering into this
Agreement or would conflict with the performance of Executive’s duties pursuant to this Agreement.
Executive represents and warrants that Executive will not engage in any activity, which would
conflict with the performance of Executive’s duties pursuant to this Agreement.

     8. Notices. All notices and other communications under this Agreement
shall be in writing and shall be given by courier service or first-class mail, certified or
registered with return receipt requested, and shall be deemed to have been duly given on the date
receipt is recorded by the appropriate delivery service, or may be delivered personally by hand to
the respective persons named below:

	 	 	 
	If to Company:

	 	Pike Electric, Inc.

P.O. Box 868

100 Pike Way

Mount Airy, NC 27030

Attn: J. Eric Pike
	 
	 	 
	With copies to:

	 	Pike Electric, Inc.

P.O. Box 868

100 Pike Way

Mount Airy, NC 27030

Attn: Jeff Collins, Vice President & COO

 

 

	 	 	 
	If to Executive:

	 	James R. Fox

626 Summit Street

Winston-Salem, NC 27101
	 
	 	 
	With a copy to:

	 	Debbie Lewis Fox

626 Summit Street

Winston-Salem, NC 27101

Either party may change such party’s address for notices by notice duly given pursuant hereto.

     9. Dispute Resolution; Attorneys’ Fees. The Company and Executive agree that any
dispute arising as to the parties’ rights and obligations hereunder, other than with respect to
Section 6, shall, at the election and upon written demand of either party, be submitted to
arbitration before a single arbitrator in Delaware under the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association.

     10. Assignment; Successors. This Agreement is personal in its nature and neither of
the parties hereto shall, without the consent of the other, assign or transfer this Agreement or
any rights or obligations hereunder; provided that, in the event of the merger, consolidation,
transfer, or sale of all or substantially all of the assets of the Company with or to any other
individual or entity, this Agreement shall, subject to the provisions hereof, be binding upon and
inure to the benefit of such successor and such successor shall discharge and perform all the
promises, covenants, duties, and obligations of the Company hereunder.

     11. Governing Law. This Agreement and the legal relations thus created between the
parties hereto shall be governed by and construed under and in accordance with the laws of the
state of Delaware.

     12. Withholding. The Company shall make such deductions and withhold such amounts
from each payment made to Executive hereunder as may be required from time to time by law,
governmental regulation or order.

     13. Headings. Section headings in this Agreement are included herein for convenience
of reference only and shall not constitute a part of this Agreement for any other purpose.

 

 

     14. Waiver; Modification. Failure to insist upon strict compliance with any of the
terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant, or
condition, nor shall any waiver or relinquishment of, or failure to insist upon strict compliance
with, any right or power hereunder at any one or more times be deemed a waiver or relinquishment of
such right or power at any other time or times. This Agreement shall not be modified in any
respect except by a writing executed by each party hereto.

     15. Severability. If for any reason any term or provision containing a restriction
set forth herein is held to be for a length of time which is unreasonable or in other way is
construed to be too broad or to any extent invalid, such term or provision shall not be determined
to be null, void and of no effect, but to the extent the same is or would be valid or enforceable
under applicable law, any court shall construe and reform this Agreement to provide for a
restriction having the maximum time period and other provisions as shall be valid and enforceable
under applicable law. If, notwithstanding the previous sentence, any term or provision of this
Agreement is held to be invalid or unenforceable, all other valid terms and provisions hereof shall
remain in full force and effect, and all of the terms and provisions of this Agreement shall be
deemed to be severable in nature.

     16. Entire Agreement; Effect on Certain Prior Agreements. This Agreement constitutes
the entire agreement between the parties with respect to the subject matter hereof and supercedes
any prior agreements between them with respect to the subject matter hereof, including all prior
employment, retention, severance or related agreements between Executive and the Company or any
successor, predecessor or affiliate. Without limiting the generality of the foregoing, the
obligations under this Agreement with respect to any termination of employment of Executive, for
whatever reason, supersede any severance or related obligations of the Company or any of its
successors, predecessors or affiliates in any plan of the Company or any of its successors,
predecessors or affiliates or any agreement between Executive and the Company or any of its
successors, predecessors or affiliates.

     17. Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer, and Executive has hereunto signed this Agreement, as of the date first above
written.

	 	 	 	 	 
	PIKE ELECTRIC CORPORATION
	 
	 	 	 	 
	By:	 	/s/ J. Eric Pike
	 	 	 
	 
	 	 	 	 
	Its:	 	Chairman and CEO
	 	 	 
	 
	 	 	 	 
	Date:	 	10/10/06
	 	 	 

 

 

	 	 	 	 	 
	EXECUTIVE
	 
	 	 	 	 
	 
	 	/s/ James R. Fox	 	 
	 	 	 
	 
	 	 	 	 
	Date:	 	10/10/06
	 	 	 
	 
	 	 	 	 
	THE UNDERSIGNED has duly executed this Agreement, as of the date first above written, solely for
purposes of Section 4(b) hereof.
	 
	 	 	 	 
	PIKE ELECTRIC CORPORATION
	 
	 	 	 	 
	By:	 	/s/ J. Eric Pike
	 	 	 
	 
	 	 	 	 
	Its:	 	Chairman and CEO
	 	 	 
	 
	 	 	 	 
	Date:	 	10/10/06

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