<SUBMISSION>
<ACCESSION-NUMBER>0000012355-06-000052
<TYPE>10-K
<PUBLIC-DOCUMENT-COUNT>27
<PERIOD>20051231
<FILING-DATE>20060215
<DATE-OF-FILING-DATE-CHANGE>20060215
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>BLACK & DECKER CORP
<CIK>0000012355
<ASSIGNED-SIC>3540
<IRS-NUMBER>520248090
<STATE-OF-INCORPORATION>MD
<FISCAL-YEAR-END>1205
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-K
<ACT>34
<FILE-NUMBER>333-03593
<FILM-NUMBER>06622613
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>701 E JOPPA RD
<CITY>TOWSON
<STATE>MD
<ZIP>21286
<PHONE>4107163900
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>701 EAST JOPPA ROAD
<STREET2>MAIL STOP TW 290
<CITY>TOWSON
<STATE>MD
<ZIP>21286
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BLACK & DECKER MANUFACTURING CO
<DATE-CHANGED>19850206
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>form10k12312005a.htm
<DESCRIPTION>FORM 10-K FILED FEBRUARY 15, 2005
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
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<BODY>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>UNITED STATES SECURITIES AND EXCHANGE COMMISSION<BR> WASHINGTON, D.C. 20549<BR>
FORM 10-K<BR>ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF<BR>THE SECURITIES EXCHANGE ACT OF 1934</B>
</FONT></P>


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<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">FOR THE FISCAL YEAR ENDED<BR><B>December 31, 2005</B> </FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">COMMISSION FILE NUMBER<BR><B>1-1553</B></FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
CORPORATION</B><BR>(Exact
name of registrant as specified in its charter) </FONT></P>


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<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Maryland</B><BR>(State of Incorporation)</FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>52-0248090</B><BR>(I.R.S. Employer Identification Number)
</FONT></TD></TR>
</TABLE>

<BR>

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<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Towson, Maryland</B><BR>(Address of
 principal executive offices) </FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B> 21286</B><BR>(Zip Code)
</FONT></TD></TR>
</TABLE>

<BR>

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<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
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<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Registrant&#146;s telephone number,
including area code:</FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B> 410-716-3900</B>
</FONT></TD></TR>
</TABLE>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Securities registered pursuant to
Section 12(b) of the Act: </FONT></P>


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<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Title of each class<BR><B>Common Stock,
par value $.50 per share</B></FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Name of each exchange on which registered
<BR><B>New York Stock Exchange</B></FONT></TD></TR>
</TABLE>

<BR>

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<TR VALIGN="BOTTOM">
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<TR VALIGN="TOP">
     <TD WIDTH="50%" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Securities registered pursuant to
Section 12(g) of the Act:</FONT></TD>
     <TD WIDTH="50%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>None</B>
</FONT></TD></TR>
</TABLE>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.<BR>Yes<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X&nbsp;
&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;No <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></P>

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<A NAME=A003></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark if the registrant is not required to
 file reports pursuant to Section 13 or Section 15(d) of the Act.<BR>Yes<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;No <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></P>



<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.<BR>Yes<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X&nbsp;
&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;No <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark if disclosure
of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant&#146;s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
See definition of &#147;accelerated filer and large accelerated filer&#148; in Rule 12b-2
of the Exchange Act. (check one):<BR>
Large accelerated filer <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X&nbsp;
&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;&nbsp;&nbsp;Accelerated filer <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;&nbsp;&nbsp;
Non-accelerated filer <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Act).<BR>Yes<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;No <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The aggregate market value of the
voting stock held by non-affiliates of the registrant as of July 1, 2005, was $7.06
billion. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The number of shares of Common Stock
outstanding as of January 27, 2006, was 77,384,681. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The exhibit index as required by Item
601(a) of Regulation S-K is included in Item 15 of Part IV of this report.<BR><BR>Documents
Incorporated by Reference: Portions of the registrant&#146;s definitive Proxy Statement
for the 2006 Annual Meeting of Stockholders are incorporated by reference in Part III of
this Report. </FONT></P>



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<A NAME=A001></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=4><B>PART I</B></FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 1. BUSINESS</B></FONT></P>

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<A NAME=A002></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(a) General Development
of Business </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (collectively with its subsidiaries, the Corporation),
incorporated in Maryland in 1910, is a leading global manufacturer and marketer of power
tools and accessories, hardware and home improvement products, and technology-based
fastening systems. With products and services marketed in over 100 countries, the
Corporation enjoys worldwide recognition of its strong brand names and a superior
reputation for quality, design, innovation, and value. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is one of the world&#146;s leading producers of power tools, power tool
accessories, and residential security hardware, and the Corporation&#146;s product lines
hold leading market share positions in these industries. The Corporation is also a major
global supplier of engineered fastening and assembly systems. The Corporation is one of
the leading producers of faucets in North America. These assertions are based on total
volume of sales of products compared to the total market for those products and are
supported by market research studies sponsored by the Corporation as well as independent
industry statistics available through various trade organizations and periodicals,
internally generated market data, and other sources. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the fourth quarter of 2004, the Corporation acquired the Porter-Cable and Delta Tools
Group from Pentair, Inc. The Porter-Cable and Delta Tools Group (also referred to herein
as the &#147;Tools Group&#148;) included the Porter-Cable, Delta, DeVilbiss Air Power
Company, Oldham Saw, and FLEX businesses. The Corporation sold the FLEX business in
November 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the fourth quarter of 2003, the Corporation completed the acquisition of the Baldwin
Hardware Corporation (Baldwin) and Weiser Lock Corporation (Weiser) from Masco
Corporation. For additional information about the acquisitions of the Tools Group and
Baldwin and Weiser, see Note 2 of Notes to Consolidated Financial Statements included in
Item 8 of Part II of this report. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
November 2005, the Corporation completed the sale of DOM security hardware. In January
2004, the Corporation completed the sale of two European security hardware businesses,
Corbin and NEMEF. The divested businesses are reflected as discontinued operations in the
Consolidated Financial Statements included in Item 8 of Part II of this report, and as
such, operating results, assets and liabilities, and cash flows of the discontinued
European security hardware business have been reported separately from the continuing
operations of the Corporation. For additional information about the discontinued European
security hardware business, see the discussion in Note 3 of Notes to Consolidated
Financial Statements included in Item 8 of Part II of this report. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(b) Financial Information
About Business Segments </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation operates in three
reportable business segments: Power Tools and Accessories, including consumer and
professional power tools and accessories, lawn and garden tools, electric cleaning and
lighting products, and product service; Hardware and Home Improvement, including security
hardware and plumbing products; and Fastening and Assembly Systems. For additional
information about these segments, see Note 18 of Notes to Consolidated Financial
Statements included in Item 8 of Part II, and Management&#146;s Discussion and Analysis of
Financial Condition and Results of Operations included in Item 7 of Part II of this
report. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(c) Narrative Description
of the Business </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The following is a brief description
of each of the Corporation&#146;s reportable business segments. </FONT></P>

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<A NAME=A005></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>POWER TOOLS AND
ACCESSORIES </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Power Tools and Accessories
segment has worldwide responsibility for the manufacture and sale of consumer (home use)
and professional corded and cordless electric power tools and equipment, lawn and garden
tools, home products, accessories and attachments for power tools, and product service. In
addition, the Power Tools and Accessories segment has responsibility for the sale of
security hardware to customers in Mexico, Central America, the Caribbean, and South
America; for the sale of plumbing products to customers outside of the United States and
Canada; and for sales of household products, principally in Europe and Brazil. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Power
tools and equipment include drills, screwdrivers, impact wrenches and drivers, hammers,
wet/dry vacuums, lights, radio/chargers, saws, grinders, band saws, plate joiners,
jointers, lathes, dust management systems, routers, planers, sanders, benchtop and
stationary machinery, air tools, building instruments, air compressors, generators, laser
products, jobsite security systems, and WORKMATE&reg; project centers and related
products. Lawn and garden tools include hedge trimmers, string trimmers, lawn mowers,
edgers, pruners, shears, shrubbers, blower/vacuums, power sprayers, pressure washers, and
related accessories. Home products include stick, canister and hand-held vacuums; flexible
flashlights; and wet scrubbers. Power tool accessories include drill bits, hammer bits,
router bits, hacksaws and blades, circular saw blades, jig and reciprocating saw blades,
screwdriver bits and quick-change systems, bonded and other abrasives, and worksite tool
belts and bags. Product service provides replacement parts and repair and maintenance of
power tools, equipment, and lawn and garden tools. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>1</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Power
tools, lawn and garden tools, home products, and accessories are marketed around the world
under the BLACK &amp; DECKER name as well as other trademarks and trade names, including,
without limitation, BLACK &amp; DECKER; ORANGE AND BLACK COLOR SCHEME; POWERFUL SOLUTIONS;
FIRESTORM; GELMAX COMFORT GRIP; MOUSE; BULLSEYE; PIVOT DRIVER; STORMSTATION; WORKMATE;
BLACK &amp; DECKER XT; VERSAPAK; SMART DRIVER; QUANTUM PRO; CYCLONE; NAVIGATOR; DRAGSTER;
SANDSTORM; PROJECTMATE; PIVOTPLUS; QUICK CLAMP; SIGHT-LINE; CROSSFIRE; CROSSHAIR;
360&deg;; QUATTRO; DECORMATE; LASERCROSS; XTEAM; SHOPMASTER BY DELTA; DEWALT; YELLOW AND
BLACK COLOR SCHEME; GUARANTEED TOUGH; XRP; SITELOCK; PORTER-CABLE; GRAY AND BLACK COLOR
SCHEME; TIGER SAW; PORTA-BAND; POWERBACK; EASY AIR; JOB BOSS; DELTA; THE DELTA TRIANGLE
LOGO; UNISAW; BIESEMEYER; BLACK AND WHITE COLOR SCHEME; DAPC; EMGLO; AFS AUTOMATIC FEED
SPOOL; GROOM &#145;N&#146; EDGE; HEDGE HOG; GRASS HOG; EDGE HOG; LEAF HOG; LAWN HOG;
STRIMMER; REFLEX; VAC &#145;N&#146; MULCH; EXCELL; ALLIGATOR; TRIM &#145;N&#146; EDGE;
HDL; TOUGH TRUCK; FLEX TUBE; DUSTBUSTER; SNAKELIGHT; SCUMBUSTER; STEAMBUSTER; CYCLOPRO;
SWEEP &amp; COLLECT; CLICK &amp; GO; B&amp;D; BULLET; QUANTUM PRO; PIRANHA; SCORPION;
QUICK CONNECT; PILOT POINT; RAPID LOAD; ROCK CARBIDE; TOUGH CASE; MAX LIFE; RAZOR; OLDHAM;
DEWALT SERVICENET; DROP BOX EXPRESS; and GUARANTEED REPAIR COST (GRC). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
composition of the Corporation&#146;s sales by product groups for 2005, 2004, and 2003 is
included in Note 18 of Notes to Consolidated Financial Statements included in Item 8 of
Part II of this report. Within each product group shown, there existed no individual
product that accounted for greater than 10% of the Corporation&#146;s consolidated sales
for 2005, 2004, or 2003. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s product service program supports its power tools and lawn and garden
tools. Replacement parts and product repair services are available through a network of
company-operated service centers, which are identified and listed in product information
material generally included in product packaging. At December 31, 2005, there were
approximately 130 such service centers, of which roughly three-quarters were located in
the United States. The remainder was located around the world, primarily in Canada and
Asia. These company-operated service centers are supplemented by several hundred
authorized service centers operated by independent local owners. The Corporation also
operates reconditioning centers in which power tools, lawn and garden tools, and electric
cleaning and lighting products are reconditioned and then re-sold through numerous
company-operated factory outlets and service centers and various independent distributors. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Most
of the Corporation&#146;s consumer power tools, lawn and garden tools, and electric
cleaning and lighting products sold in the United States carry a two-year warranty,
pursuant to which the consumer can return defective products during the two years
following the purchase in exchange for a replacement product or repair at no cost to the
consumer. Most of the Corporation&#146;s professional power tools sold in the United
States carry a one-year service warranty and a three-year warranty for manufacturing
defects. Products sold outside of the United States generally have varying warranty
arrangements, depending upon local market conditions and laws and regulations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s product offerings in the Power Tools and Accessories segment are sold
primarily to retailers, wholesalers, distributors, and jobbers, although some discontinued
or reconditioned power tools, lawn and garden tools, and electric cleaning and lighting
products are sold through company-operated service centers and factory outlets directly to
end users. Sales to two of the segment&#146;s customers, The Home Depot and Lowe&#146;s
Home Improvement Warehouse, accounted for greater than 10% of the Corporation&#146;s
consolidated sales for 2005, 2004, and 2003. For additional information regarding sales to
The Home Depot and Lowe&#146;s Home Improvement Warehouse, see Note 18 of Notes to
Consolidated Financial Statements included in Item 8 of Part II of this report. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
principal materials used in the manufacturing of products in the Power Tools and
Accessories segment are batteries, copper, aluminum, steel, certain electronic components,
engines, and plastics. These materials are used in various forms. For example, aluminum or
steel may be used in the form of wire, sheet, bar, and strip stock. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
materials used in the various manufacturing processes are purchased on the open market,
and the majority are available through multiple sources and are in adequate supply. The
Corporation has experienced no significant work stoppages to date as a result of shortages
of materials. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation has certain long-term commitments for the purchase of various component parts
and raw materials and believes that it is unlikely that any of these agreements would be
terminated prematurely. Alternate sources of supply at competitive prices are available
for most items for which long-term commitments exist. Because the Corporation is a leading
producer of power tools and accessories, in a limited number of instances, the magnitude
of the Corporation&#146;s purchases of certain items is of such significance that a change
in the Corporation&#146;s established supply relationship may cause disruption in the
marketplace and/or a temporary price imbalance. While the Corporation believes that the
termination of any of these commitments would not have a material adverse effect on the
operating results of the Power Tools and Accessories segment over the long term, the
termination of a limited number of these commitments would have an adverse effect over the
short term. In this regard, the Corporation defines long term as a period of time in
excess of 12 months and short term as a period of time under 12 months. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
manufacturing and assembly facilities of the power tools, lawn and garden tools, electric
cleaning and lighting products, and accessories businesses in the United States are
located in Jackson, Tennessee; Decatur, Arkansas; Shelbyville, Kentucky; and Tampa,
Florida. The principal distribution facilities in the United States, other than those
located at the manufacturing and assembly facilities listed above, are located in Fort
Mill, South Carolina, and Rialto, California. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
manufacturing and assembly facilities of the power tools, lawn and garden tools, electric
cleaning and lighting products, and accessories businesses outside of the United States
are located in Suzhou, China; Taichung, Taiwan; Usti nad Labem, Czech Republic;
Buchlberg<I>, </I>Germany; Perugia, Italy; Spennymoor, England; Reynosa, Mexico; and
Uberaba, Brazil. In addition to the principal facilities described above, the manufacture
and assembly of products for the Power Tools and Accessories segment also occurs at the
facility of its 50%-owned joint venture located in Shen Zhen, China. The principal
distribution facilities outside of the United States, other than those located at the
manufacturing facilities listed above, consist of a central-European distribution center
in Tongeren, Belgium, and facilities in Aarschot, Belgium; Northampton, England; Dubai,
United Arab Emirates; and Brockville, Canada. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
additional information with respect to these and other properties owned or leased by the
Corporation, see Item 2, &#147;Properties.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation holds various patents and licenses on many of its products and processes in
the Power Tools and Accessories segment. Although these patents and licenses are
important, the Corporation is not materially dependent on such patents or licenses with
respect to its operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation holds various trademarks that are employed in its businesses and operates
under various trade names, some of which are stated previously. The Corporation believes
that these trademarks and trade names are important to the marketing and distribution of
its products. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
significant portion of the Corporation&#146;s sales in the Power Tools and Accessories
segment is derived from the do-it-yourself and home modernization markets, which generally
are not seasonal in nature. However, sales of certain consumer and professional power
tools tend to be higher during the period immediately preceding the Christmas gift-giving
season, while the sales of most lawn and garden tools are at their peak during the late
winter and early spring period. Most of the Corporation&#146;s other product lines within
this segment generally are not seasonal in nature, but are influenced by other general
economic trends. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is one of the world&#146;s leaders in the manufacturing and marketing of
portable power tools, electric lawn and garden tools, and accessories. Worldwide, the
markets in which the Corporation sells these products are highly competitive on the basis
of price, quality, and after-sale service. A number of competing domestic and foreign
companies are strong, well-established manufacturers that compete on a global basis. Some
of these companies manufacture products that are competitive with a number of the
Corporation&#146;s product lines. Other competitors restrict their operations to fewer
categories, and some offer only a narrow range of competitive products. Competition from
certain of these manufacturers has been intense in recent years and is expected to
continue. </FONT></P>

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<A NAME=A006></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>HARDWARE AND HOME
IMPROVEMENT </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Hardware and Home Improvement
segment has worldwide responsibility for the manufacture and sale of security hardware
products (except for the sale of security hardware in Mexico, Central America, the
Caribbean, and South America). It also has responsibility for the manufacture of plumbing
products and for the sale of plumbing products to customers in the United States and
Canada. Security hardware products consist of residential and light commercial door
locksets, electronic keyless entry systems, exit devices, keying systems, tubular and
mortise door locksets, general hardware, decorative hardware, lamps, and brass ornaments.
General hardware includes door hinges, cabinet hinges, door stops, kick plates, and house
numbers. Decorative hardware includes cabinet hardware, switchplates, door pulls, and push
plates. Plumbing products consist of a variety of conventional and decorative lavatory,
kitchen, and tub and shower faucets, bath and kitchen accessories, and replacement parts. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Security
hardware products are marketed under a variety of trademarks and trade names, including,
without limitation, KWIKSET SECURITY; KWIKSET MAXIMUM SECURITY; KWIKSET ULTRAMAX;
SIGNATURES; KWIKSET; BEAUTY OF STRENGTH; BLACK &amp; DECKER; TYLO; POLO; AVALON; ASHFIELD;
VENETIAN BRONZE; POWERBOLT; KWIK INSTALL; EZ INSTALL; GEO; SAFE-LOCK BY BLACK &amp;
DECKER; BALDWIN; THE ESTATE COLLECTION; THE IMAGES COLLECTION; ARCHETYPES; LIFETIME
FINISH; TIMELESS CRAFTSMANSHIP; LOGAN; SPRINGFIELD; HAMILTON; BLAKELY; MANCHESTER;
CANTERBURY; MADISON; STONEGATE; EDINBURGH; KENSINGTON; BRISTOL; TREMONT; PEYTON; PASADENA;
RICHLAND; WEISER; WEISER LOCK; COLLECTIONS BY/DE WEISER LOCK; PRESTIGE SERIES; WELCOME
HOME SERIES; ELEMENTS SERIES; BASICS BY WEISER LOCK; BRILLIANCE LIFETIME ANTI-TARNISH
FINISH; POWERBOLT; POWERBOLT KEYLESS ACCESS SYSTEM; WEISERBOLT; and ENTRYSETS. Plumbing
products are marketed under the trademarks and trade names PRICE PFISTER; CLASSIC SERIES
BY PRICE PFISTER; PRICE PFISTER PROFESSIONAL SERIES; BACH; SOLO; CONTEMPRA; MARIELLE;
CARMEL; PARISA; SAVANNAH; CATALINA; GEORGETOWN; TREVISO; AVALON; and ASHFIELD. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>3</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
composition of the Corporation&#146;s sales by product groups for 2005, 2004, and 2003 is
included in Note 18 of Notes to Consolidated Financial Statements included in Item 8 of
Part II of this report. Within each product group shown, there existed no individual
product that accounted for greater than 10% of the Corporation&#146;s consolidated sales
for 2005, 2004, or 2003. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Most
of the Corporation&#146;s security hardware products sold in the United States carry a
warranty, pursuant to which the consumer can return defective product during the warranty
term in exchange for a replacement product at no cost to the consumer. Warranty terms vary
by product and range from a 10-year to a lifetime warranty with respect to mechanical
operations and from a 5-year to a lifetime warranty with respect to finish. Products sold
outside of the United States for residential use generally have similar warranty
arrangements. Such arrangements vary, however, depending upon local market conditions and
laws and regulations. Most of the Corporation&#146;s plumbing products sold in the United
States carry a lifetime warranty with respect to function and finish, pursuant to which
the consumer can return defective product in exchange for a replacement product or repair
at no cost to the consumer. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s product offerings in the Hardware and Home Improvement segment are sold
primarily to retailers, wholesalers, distributors, and jobbers. Certain security hardware
products are sold to commercial, institutional, and industrial customers. Sales to two of
the segment&#146;s customers, The Home Depot and Lowe&#146;s Home Improvement Warehouse,
accounted for greater than 10% of the Corporation&#146;s consolidated sales for 2005,
2004, and 2003. For additional information regarding sales to The Home Depot and
Lowe&#146;s Home Improvement Warehouse, see Note 18 of Notes to Consolidated Financial
Statements included in Item 8 of Part II of this report. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
principal materials used in the manufacturing of products in the Hardware and Home
Improvement segment are zamak, brass, plastics, aluminum, steel, and ceramics. The
materials used in the various manufacturing processes are purchased on the open market,
and the majority is available through multiple sources and is in adequate supply. The
Corporation has experienced no significant work stoppages to date as a result of shortages
of materials. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation has certain long-term commitments for the purchase of various finished goods,
component parts, and raw materials and believes that it is unlikely that any of these
agreements would be terminated prematurely. Alternate sources of supply at competitive
prices are available for most items for which long-term commitments exist. Because the
Corporation is a leading producer of residential security hardware and faucets, in a
limited number of instances, the magnitude of the Corporation&#146;s purchases of certain
items is of such significance that a change in the Corporation&#146;s established supply
relationship may cause disruption in the marketplace and/or a temporary price imbalance.
While the Corporation believes that the termination of any of these commitments would not
have a material adverse effect on the operating results of the Hardware and Home
Improvement segment over the long term, the termination of a limited number of these
commitments would have an adverse effect over the short term. In this regard, the
Corporation defines long term as a period of time in excess of 12 months and short term as
a period of time under 12 months. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
time to time, the Corporation enters into commodity hedges on certain raw materials used
in the manufacturing process to reduce the risk of market price fluctuations. As of
December 31, 2005, no commodity hedges were outstanding. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
manufacturing and assembly facilities of the Hardware and Home Improvement segment in the
United States are located in Denison, Texas, and Reading, Pennsylvania. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
manufacturing and assembly facilities of the Hardware and Home Improvement segment outside
of the United States are located in Mexicali and Nogales, Mexico. The principal
distribution facilities in the United States, other than those located at the
manufacturing and assembly facilities listed above, are located in Mira Loma, California,
and Charlotte, North Carolina. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
additional information with respect to these and other properties owned or leased by the
Corporation, see Item 2, &#147;Properties.&#148; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation holds various patents and licenses on many of its products and processes in
the Hardware and Home Improvement segment. Although these patents and licenses are
important, the Corporation is not materially dependent on such patents or licenses with
respect to its operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation holds various trademarks that are employed in its businesses and operates
under various trade names, some of which are stated above. The Corporation believes that
these trademarks and trade names are important to the marketing and distribution of its
products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
significant portion of the Corporation&#146;s sales in the Hardware and Home Improvement
segment is derived from the do-it-yourself and home modernization markets, which generally
are not seasonal in nature, but are influenced by trends in the residential and commercial
construction markets and other general economic trends. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is one of the world&#146;s leading producers of residential security hardware
and is one of the leading producers of faucets in North America. Worldwide, the markets in
which the Corporation sells these products are highly competitive on the basis of price,
quality, and after-sale service. A number of competing domestic and foreign companies are
strong, well-established manufacturers that compete on a</FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>global basis. Some of these
companies manufacture products that are competitive with a number of the
Corporation&#146;s product lines. Other competitors restrict their operations to fewer
categories, and some offer only a narrow range of competitive products. Competition from
certain of these manufacturers has been intense in recent years and is expected to
continue. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A007></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>FASTENING AND ASSEMBLY
SYSTEMS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s Fastening and
Assembly Systems segment has worldwide responsibility for the manufacture and sale of an
extensive line of metal and plastic fasteners and engineered fastening systems for
commercial applications, including blind riveting, stud welding, assembly systems,
specialty screws, prevailing torque nuts and assemblies, insert systems, metal and plastic
fasteners, and self-piercing riveting systems. The fastening and assembly systems products
are marketed under a variety of trademarks and trade names, including, without limitation,
EMHART TEKNOLOGIES; EMHART FASTENING TEKNOLOGIES; EMHART; EMTEK; AUTOSET; DODGE;
DRIL-KWICK; F-SERIES; GRIPCO; GRIPCO ASSEMBLIES; HELI-COIL; JACK NUT; KALEI; MASTERFIX;
MENTOR; NPR; NUT-FAST; PARKER-KALON; PLASTIFAST; PLASTI-KWICK; POINT &amp; SET; POP;
POP-LOK; POPMATIC; POPNUT; POP-SERT; POWERLINK; PROSET; SMARTSET; SPLITFAST; SWS; T-RIVET;
TUCKER; ULTRA-GRIP; ULTRASERT; SWAGEFORM; WARREN; WELDFAST; and WELL-NUT. The Fastening
and Assembly Systems segment provides platform-management services in addition to the
manufacture and sale of the products previously described. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
composition of the Corporation&#146;s sales by product groups for 2005, 2004, and 2003 is
included in Note 18 of Notes to Consolidated Financial Statements included in Item 8 of
Part II of this report. Within each product group shown, there existed no individual
product that accounted for greater than 10% of the Corporation&#146;s consolidated sales
for 2005, 2004, or 2003. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
principal markets for these products include the automotive, transportation, electronics,
aerospace, machine tool, and appliance industries. Substantial sales are made to
automotive manufacturers worldwide. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Products
are marketed directly to customers and also through distributors and representatives.
These products face competition from many manufacturers in several countries. Product
quality, performance, reliability, price, delivery, and technical and application
engineering services are the primary competitive factors. There is little seasonal
variation in sales. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation owns a number of United States and foreign patents, trademarks, and license
rights relating to the fastening and assembly systems business. While the Corporation
considers those patents, trademarks, and license rights to be valuable, it is not
materially dependent upon such patents or license rights with respect to its operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
manufacturing facilities of the Fastening and Assembly Systems segment in the United
States are located in Danbury, Connecticut; Montpelier, Indiana; Campbellsville and
Hopkinsville, Kentucky; and Chesterfield, Michigan. Principal manufacturing and assembly
facilities outside of the United States are located in Birmingham, England; Giessen,
Germany; and Toyohashi, Japan. For additional information with respect to these and other
properties owned or leased by the Corporation, see Item 2, &#147;Properties.&#148; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
raw materials used in the fastening and assembly systems business consist primarily of
ferrous and nonferrous metals in the form of wire, bar stock, and strip and sheet metals;
plastics; and rubber. These materials are readily available from a number of suppliers. </FONT></P>

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<A NAME=A008></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OTHER INFORMATION </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s product
development program for the Power Tools and Accessories segment is coordinated from the
Corporation&#146;s headquarters in Towson, Maryland. Additionally, product development
activities are performed at facilities in Hampstead, Maryland, and Jackson, Tennessee, in
the United States; Maltby and Spennymoor, England; Brockville, Canada; Perugia, Italy;
Suzhou, China; Taichung, Taiwan; Buchlberg and Idstein, Germany; Mooroolbark, Australia;
Uberaba, Brazil; and Reynosa, Mexico. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Product
development activities for the Hardware and Home Improvement segment are performed at
facilities in Lake Forest, California, and Reading, Pennsylvania. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Product
development activities for the Fastening and Assembly Systems segment are performed at
facilities in Danbury and Shelton, Connecticut; Montpelier, Indiana; Campbellsville,
Kentucky; Chesterfield and Farmington Hills, Michigan; Birmingham, England; Maastricht,
Netherlands; Giessen, Germany; and Toyohashi, Japan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Costs
associated with development of new products and changes to existing products are charged
to operations as incurred. See Note 1 of Notes to Consolidated Financial Statements
included in Item 8 of Part II of this report for amounts of expenditures for product
development activities. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of December 31, 2005, the Corporation employed approximately 27,200 persons in<I> </I>its
operations worldwide. Approximately 430 employees in the United States are covered by
collective bargaining agreements. During 2005, three collective bargaining agreements in
the United States were negotiated without material disruption to operations. No agreements
are scheduled for negotiation during 2006. Also, the Corporation has government-mandated
collective bargaining arrangements or union contracts with employees in other countries.
The Corporation&#146;s operations have not been affected significantly by work stoppages
and, in the opinion of management, employee relations</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>5</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>are good. As more fully described
under the caption &#147;Restructuring Actions&#148; in Management&#146;s Discussion and
Analysis of Financial Condition and Results of Operations, the Corporation is committed to
continuous productivity improvement and continues to evaluate opportunities to reduce
fixed costs, simplify or improve processes, and eliminate excess capacity. As a
consequence, the Corporation may, from time to time, transfer production from one
manufacturing facility to another, outsource certain production, or close certain
manufacturing facilities. Such production transfers, outsourcing, and/or facility closures
may result in a deterioration of employee relations at the impacted locations or elsewhere
in the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s operations are subject to foreign, federal, state, and local
environmental laws and regulations. Many foreign, federal, state, and local governments
also have enacted laws and regulations that govern the labeling and packaging of products
and limit the sale of products containing certain materials deemed to be environmentally
sensitive. These laws and regulations not only limit the acceptable methods for the
discharge of pollutants and the disposal of products and components that contain certain
substances, but also require that products be designed in a manner to permit easy
recycling or proper disposal of environmentally sensitive components such as nickel
cadmium batteries. The Corporation seeks to comply fully with these laws and regulations.
Although compliance involves continuing costs, the ongoing costs of compliance with
existing environmental laws and regulations have not had, nor are they expected to have, a
material adverse effect upon the Corporation&#146;s capital expenditures or financial
position. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to authority granted under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (CERCLA), the United States Environmental Protection Agency (EPA)
has issued a National Priority List (NPL) of sites at which action is to be taken to
mitigate the risk of release of hazardous substances into the environment. The Corporation
is engaged in continuing activities with regard to various sites on the NPL and other
sites covered under analogous state environmental laws. As of December 31, 2005, the
Corporation had been identified as a potentially responsible party (PRP) in connection
with approximately 24 sites being investigated by federal or state agencies under CERCLA
or analogous state environmental laws. The Corporation also is engaged in site
investigations and remedial activities to address environmental contamination from past
operations at current and former manufacturing facilities in the United States and abroad. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
minimize the Corporation&#146;s potential liability with respect to these sites,
management has undertaken, when appropriate, active participation in steering committees
established at the sites and has agreed to remediation through consent orders with the
appropriate government agencies. Due to uncertainty as to the Corporation&#146;s
involvement in some of the sites, uncertainty over the remedial measures to be adopted,
and the fact that imposition of joint and several liability with the right of contribution
is possible under CERCLA and other laws and regulations, the liability of the Corporation
with respect to any site at which remedial measures have not been completed cannot be
established with certainty. On the basis of periodic reviews conducted with respect to
these sites, however, the Corporation has established appropriate liability accruals. The
Corporation&#146;s estimate of the costs associated with environmental exposures is
accrued if, in management&#146;s judgment, the likelihood of a loss is probable and the
amount of the loss can be reasonably estimated. As of December 31, 2005, the
Corporation&#146;s aggregate probable exposure with respect to environmental liabilities,
for which accruals have been established in the consolidated financial statements, was
$69.9 million. In the opinion of management, the amount accrued for probable exposure for
aggregate environmental liabilities is adequate and, accordingly, the ultimate resolution
of these matters is not expected to have a material adverse effect on the
Corporation&#146;s consolidated financial statements. As of December 31, 2005, the
Corporation had no known probable but inestimable exposures relating to environmental
matters that are expected to have a material adverse effect on the Corporation. There can
be no assurance, however, that unanticipated events will not require the Corporation to
increase the amount it has accrued for any environmental matter or accrue for an
environmental matter that has not been previously accrued because it was not considered
probable. While it is possible that the increase or establishment of an accrual could have
a material adverse effect on the financial results for any particular fiscal quarter or
year, in the opinion of management there exists no known potential exposures that would
have a material adverse effect on the financial condition or on the financial results of
the Corporation beyond any such fiscal quarter or year. </FONT></P>

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<A NAME=A009></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(d) Financial Information
About Geographic Areas </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reference is made to Note 18 of Notes
to Consolidated Financial Statements, entitled &#147;Business Segments and Geographic
Information&#148;, included in Item 8 of Part II of this report. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A010></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(e) Available Information</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation files annual,
quarterly, and current reports, proxy statements, and other documents with the Securities
and Exchange Commission (SEC) under the Securities Exchange Act of 1934 (the Exchange
Act). The public may read and copy any materials that the Corporation files with the SEC
at the SEC&#146;s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The
public may obtain information on the operation of the Public Reference Room by calling the
SEC at</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>6</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1-800-SEC-0330. Also, the SEC maintains an Internet website that contains reports,
proxy and information statements, and other information regarding issuers, including the
Corporation, that file electronically with the SEC. The public can obtain any documents
that the Corporation files with the SEC at <I>http://www.sec.gov.</I> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation also makes available free of charge on or through its Internet website
(<I>http://www.bdk.com</I>) the Corporation&#146;s Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable, amendments to those
reports filed or furnished pursuant to Section 13(a) of the Exchange Act as soon as
reasonably practicable after the Corporation electronically files such material with, or
furnishes it to, the SEC. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Black
&amp; Decker&#146;s Corporate Governance Policies and Procedures Statement is available
free of charge on or through its Internet website (<I>http://www.bdk.com</I>) or in print
by calling (800) 992-3042 or (410) 716-2914. The Statement contains charters of the
standing committees of the Board of Directors, the Code of Ethics and Standards of
Conduct, and the Code of Ethics for Senior Financial Officers. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
April 2005, the Corporation submitted to the New York Stock Exchange the CEO certification
required by Section 303A.12(a) of the New York Stock Exchange Listed Company Manual. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(f)&nbsp;&nbsp;&nbsp;&nbsp;
          Executive Officers and Other Senior Officers of the Corporation</B> </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The current
          Executive Officers and Other Senior Officers of the Corporation, their ages,
          current offices or positions, and their business experience during the past five
          years are set forth below. </FONT></P>


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<A NAME=A011></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  NOLAN D. ARCHIBALD &#150; 62</B><BR>&nbsp;&nbsp;&nbsp;Chairman,
President, and Chief Executive Officer,<BR>
&nbsp;&nbsp;&nbsp;January 1990 &#150; present.</FONT></P>


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<A NAME=A012></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  BRUCE W. BROOKS &#150; 42</B><BR>&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>
&nbsp;&nbsp;&nbsp;Construction Tools, Industrial
Products Group, <BR>&nbsp;&nbsp;&nbsp;Power
Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;May 2005 &#150; present;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President and General Manager &#150;<BR>
&nbsp;&nbsp;&nbsp;Construction Tools, Industrial Products Group,<BR>&nbsp;&nbsp;&nbsp;Power
Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;October 2004 &#150; May 2005;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President Marketing &#150; DEWALT Professional<BR>&nbsp;&nbsp;&nbsp;Products, Power Tools and Accessories
Group, <BR>&nbsp;&nbsp;&nbsp;July
2003 &#150; October 2004; <BR><BR>&nbsp;&nbsp;&nbsp;Vice
President Marketing &#150;<BR>&nbsp;&nbsp;&nbsp;Black &amp; Decker Consumer Products,<BR>&nbsp;&nbsp;&nbsp;Power Tools and
Accessories Group, <BR>&nbsp;&nbsp;&nbsp;July 2000 &#150; July 2003. </FONT></P>



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<A NAME=A018></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  JAMES T. CAUDILL &#150; 38</B><BR>&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>
&nbsp;&nbsp;&nbsp;Hardware and Home Improvement,<BR>&nbsp;&nbsp;&nbsp;May
2005 &#150; present;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President and General Manager &#150;<BR>&nbsp;&nbsp;&nbsp;Accessories, Industrial Products Group, <BR>&nbsp;&nbsp;&nbsp;Power Tools
and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;October
2004 &#150; May 2005;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President &#150; Accessories, DEWALT Professional<BR> &nbsp;&nbsp;&nbsp;Products, Power Tools and
Accessories Group,<BR>&nbsp;&nbsp;&nbsp;November
2001 &#150; October 2004;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President Marketing &#150; <BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;November 2000 &#150;
November 2001. </FONT></P>



<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149; CHARLES E. FENTON &#150; 57</B><BR>&nbsp;&nbsp;&nbsp;Senior Vice President and General Counsel,
<BR>&nbsp;&nbsp;&nbsp;December 1996
&#150; present. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  PAUL A. GUSTAFSON &#150; 63
</B><BR>&nbsp;&nbsp;&nbsp;Executive
Vice President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;President &#150; Fastening and Assembly Systems,
&nbsp;&nbsp;&nbsp;<BR>&nbsp;&nbsp;&nbsp;December 1996 &#150; present. </FONT></P>


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<A NAME=A024></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  LES H. IRELAND &#150; 41</B><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;President&#150; Europe/Middle East/Africa,<BR>&nbsp;&nbsp;&nbsp;Power Tools
and Accessories,<BR>&nbsp;&nbsp;&nbsp;January 2005 &#150; present;<BR>
<BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;Managing Director &#150; Commercial Operations,<BR>&nbsp;&nbsp;&nbsp;Europe,
Black &amp; Decker Consumer Group,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,
<BR>&nbsp;&nbsp;&nbsp;November 2001
&#150; January 2005;
<BR><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;Vice President and General Manager &#150;<BR>&nbsp;&nbsp;&nbsp;DEWALT Professional
Power Tools, North America,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>
&nbsp;&nbsp;&nbsp;January 2001 &#150;
November 2001;<BR><BR>

&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>&nbsp;&nbsp;&nbsp;Accessories, Power Tools and Accessories
Group,<BR>&nbsp;&nbsp;&nbsp;September 2000 &#150; January 2001. </FONT></P>

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<A NAME=A027></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  THOMAS D. KOOS &#150; 42</B><BR>
&nbsp;&nbsp;&nbsp;Group
Vice President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;President &#150; Consumer Products Group,<BR>
&nbsp;&nbsp;&nbsp;Power Tools
and Accessories,<BR>
&nbsp;&nbsp;&nbsp;March 2004 &#150; present;<BR>
<BR>&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>&nbsp;&nbsp;&nbsp;Black &amp; Decker Consumer Products,<BR>&nbsp;&nbsp;&nbsp;Power
Tools and Accessories Group,
<BR>&nbsp;&nbsp;&nbsp;January
2001 &#150; March 2004;<BR><BR>&nbsp;&nbsp;&nbsp;
Vice
President of the Corporation and President &#150; <BR>&nbsp;&nbsp;&nbsp;
North American Consumer Power Tools,
<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>
&nbsp;&nbsp;&nbsp;December 2000 &#150; January 2001. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>7</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A031></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  BARBARA B. LUCAS &#150; 60</B><BR>
&nbsp;&nbsp;&nbsp;Senior
Vice President &#150; Public Affairs and<BR>&nbsp;&nbsp;&nbsp;Corporate Secretary,<BR>&nbsp;&nbsp;&nbsp;December 1996 &#150;
present. </FONT></P>


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<A NAME=A032></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  MICHAEL D. MANGAN &#150; 49</B><BR>
&nbsp;&nbsp;&nbsp;Senior
Vice President and Chief Financial Officer,<BR>&nbsp;&nbsp;&nbsp;January 2000 &#150; present. </FONT></P>

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<A NAME=A033></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B> &#149; PAUL
F. MCBRIDE &#150; 50 </B><BR>&nbsp;&nbsp;&nbsp;Senior Vice President &#150; Human Resources<BR>
&nbsp;&nbsp;&nbsp;and
Corporate Initiatives,<BR>&nbsp;&nbsp;&nbsp;March 2004 &#150; present;<BR><BR>
&nbsp;&nbsp;&nbsp;Executive
Vice President of the Corporation and <BR>&nbsp;&nbsp;&nbsp;President &#150; Power Tools and Accessories Group,
<BR>&nbsp;&nbsp;&nbsp;April 1999 &#150; March 2004. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  CHRISTINA M. MCMULLEN &#150; 50</B><BR>&nbsp;&nbsp;&nbsp;Vice President and Controller,<BR>&nbsp;
&nbsp;&nbsp;April 2000 &#150; present.</FONT></P>

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<A NAME=A035></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  STEPHEN F. REEVES &#150; 46</B>
<BR>&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and<BR>&nbsp;&nbsp;&nbsp;Vice President &#150; Global Finance,<BR>
&nbsp;&nbsp;&nbsp;Power Tools
and Accessories,<BR>&nbsp;&nbsp;&nbsp;March
2004 &#150; present;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and Vice President<BR>&nbsp;&nbsp;&nbsp;&#150; Finance, Power Tools and
Accessories Group, <BR>&nbsp;&nbsp;&nbsp;April 2000 &#150; March 2004. </FONT></P>


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<A NAME=A037></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  MARK M. ROTHLEITNER &#150; 47</B><BR>&nbsp;&nbsp;&nbsp;Vice
President &#150; Investor Relations and Treasurer,<BR>&nbsp;&nbsp;&nbsp;January 2000 &#150; present. </FONT></P>


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<A NAME=A038></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  ROBERT I. ROWAN &#150; 45</B><BR>&nbsp;&nbsp;&nbsp;Vice President
of the Corporation and President &#150; <BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories, Consumer<BR>&nbsp;&nbsp;&nbsp;Products
Group, Power Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;February
2006 &#150; present; <BR><BR>&nbsp;&nbsp;&nbsp;Vice President and General Manager,<BR>&nbsp;&nbsp;&nbsp;Consumer Power Tools and
Accessories,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;July 2003 &#150; February 2006;
<BR><BR>&nbsp;&nbsp;&nbsp;Vice President
&#150; Outdoor Products, Consumer<BR>&nbsp;&nbsp;&nbsp;Products
Group, Power Tools and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;
September 2001 &#150; July 2003;<BR><BR>&nbsp;&nbsp;&nbsp;Vice President
&#150; Commercial,<BR>&nbsp;&nbsp;&nbsp;Black
&amp; Decker Consumer Products,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;February 1997 &#150;
September 2001. </FONT></P>


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<A NAME=A040></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  EDWARD J. SCANLON &#150; 51</B><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>&nbsp;&nbsp;&nbsp;Commercial Operations, North and
South America,<BR>&nbsp;&nbsp;&nbsp;Power
Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;March 2004 &#150; present;<BR><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>
&nbsp;&nbsp;&nbsp;Commercial Operations, North America,
<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>
&nbsp;&nbsp;&nbsp;May 1999 &#150; March 2004. </FONT></P>



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<A NAME=A042></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  JOHN W. SCHIECH &#150; 47</B><BR>
&nbsp;&nbsp;&nbsp;Group
Vice President of the Corporation<BR>&nbsp;&nbsp;&nbsp;and President &#150; Industrial Products Group,<BR>
&nbsp;&nbsp;&nbsp;Power Tools
and Accessories,<BR>
&nbsp;&nbsp;&nbsp;March 2004 &#150; present;<BR><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>&nbsp;&nbsp;&nbsp;DEWALT Professional Products, Power
Tools<BR>&nbsp;&nbsp;&nbsp;and
Accessories Group,<BR>&nbsp;&nbsp;&nbsp;January 2001 &#150; March 2004;<BR><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150; <BR>&nbsp;&nbsp;&nbsp;North American
 Professional Power Tools,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;May 1999 &#150; January 2001. </FONT></P>


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<A NAME=A046></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  ROBERT B. SCHWARZ &#150; 57</B><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and Vice President<BR>&nbsp;&nbsp;&nbsp;
&#150;Manufacturing, Industrial
Products Group,<BR>&nbsp;&nbsp;&nbsp;Power
Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;March 2004 &#150; present;<BR><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and Vice President<BR>&nbsp;&nbsp;&nbsp;
&#150; Manufacturing, DEWALT
Professional Products,<BR>&nbsp;&nbsp;&nbsp;Power Tools and Accessories Group,<BR>&nbsp;&nbsp;&nbsp;October
2001 &#150; March 2004;<BR><BR>&nbsp;&nbsp;&nbsp;Vice
President &#150; Manufacturing, DEWALT Professional<BR>
&nbsp;&nbsp;&nbsp;Products, Power Tools and Accessories
Group,<BR>&nbsp;&nbsp;&nbsp;December 1995 &#150; October 2001. </FONT></P>

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<A NAME=A050></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#149;  BHUPINDER (BEN) S. SIHOTA &#150; 47</B><BR>
&nbsp;&nbsp;&nbsp;Vice
President of the Corporation and President &#150;<BR>&nbsp;&nbsp;&nbsp;Asia Pacific Commercial Operations,<BR>&nbsp;&nbsp;&nbsp;Power
 Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;February
2006 &#150; present; <BR><BR>&nbsp;&nbsp;&nbsp;President
&#150; Asia, Power Tools and Accessories,<BR>&nbsp;&nbsp;&nbsp;September 2000 &#150; February 2006. </FONT></P>

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<A NAME=A053></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(g) Forward-Looking
Statements </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Private Securities Litigation
Reform Act of 1995 (the Reform Act) provides a safe harbor for forward-looking statements
made by or on behalf of the Corporation. The Corporation and its representatives may, from
time to time, make written or verbal forward-looking statements, including statements
contained in the Corporation&#146;s filings with the Securities and Exchange Commission
and in its reports to stockholders. Generally, the inclusion of the words
&#147;believe,&#148; &#147;expect,&#148; &#147;intend,&#148; &#147;estimate,&#148;
&#147;anticipate,&#148; &#147;will,&#148; and similar expressions identify statements that
constitute &#147;forward-looking statements&#148; within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and that are
intended to come within the safe harbor protection provided by those sections. All
statements addressing operating performance, events, or developments that the Corporation
expects or anticipates will occur in the future, including statements relating to sales
growth, earnings or earnings per share growth, and market share, as well as statements
expressing optimism or pessimism about future operating results, </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>8</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2> are forward-looking
statements within the meaning of the Reform Act. The forward-looking statements are and
will be based upon management&#146;s then-current views and assumptions regarding future
events and operating performance, and are applicable only as of the dates of such
statements. The Corporation undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information, future events, or
otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By
their nature, all forward-looking statements involve risks and uncertainties, including
without limitations the risks described under the caption &#147;Risk Factors&#148; that
could materially harm the Corporation&#146;s business, financial condition, and results of
operations. You are cautioned not to place undue reliance on the Corporation&#146;s
forward-looking statements. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 1A. RISK FACTORS</B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Many of the factors that affect our
business and operations involve risk and uncertainty. The factors described below are some
of the risks that could materially harm our business, financial condition, and results of
operations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>Our business depends on the
strength of the economies in various parts of the world, particularly in the United States
and Europe.</B> We conduct business in various parts of the world, primarily in the United
States and Europe and, to a lesser extent, in Mexico, Central America, the Caribbean,
South America, Canada, Asia and Australia. As a result of this worldwide exposure, our net
revenue and profitability could be harmed as a result of economic conditions in our major
markets, including, but not limited to, recession, inflation and deflation, general
weakness in retail, automotive and construction markets, and changes in consumer
purchasing power. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>Changes in customer
preferences, the inability to maintain mutually beneficial relationships with large
customers, and the inability to penetrate new channels of distribution could adversely
affect our business.</B> We have a number of major customers, including two large customers
that, in the aggregate, constituted approximately 35% of our consolidated sales in 2005.
The loss of either of these large customers, a material negative change in our
relationship with these large customers or other major customers, or changes in consumer
preferences or loyalties could have an adverse effect on our business. Our major customers
are volume purchasers, a few of which are much larger than us and have strong bargaining
power with suppliers. This limits our ability to recover cost increases through higher
selling prices. Changes in purchasing patterns by major customers could negatively impact
manufacturing volumes and inventory levels. Further, our inability to continue to
penetrate new channels of distribution may have a negative impact on our future results. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> The inability to obtain raw
materials, component parts, and/or finished goods in a timely and cost-effective manner
from suppliers would adversely affect our ability to manufacture and market our products.</B>
We purchase raw materials and component parts from suppliers to be used in the
manufacturing of our products. In addition, we purchase certain finished goods from
suppliers. In a limited number of circumstances, the magnitude of our purchases of certain
items is of such significance that a change in our established supply relationships may
cause disruption in the marketplace, a temporary price imbalance, or both. Changes in our
relationships with suppliers or increases in the costs of purchased raw materials,
component parts or finished goods could result in manufacturing interruptions, delays,
inefficiencies or our inability to market products. In addition, our profit margins would
decrease if prices of purchased raw materials, component parts, or finished goods increase
and we are unable to pass on those increases to our customers. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> We face significant global
competition.</B> The markets in which we sell products are highly competitive on the basis of
price, quality, and after-sale service. A number of competing domestic and foreign
companies are strong, well-established manufacturers that compete globally with us. Some
of our major customers sell their own &#147;private label&#148; brands that compete
directly with our products. Price reductions taken by us in response to customer and
competitive pressures, as well as price reductions and promotional actions taken to drive
demand that may not result in anticipated sales levels, could also negatively impact our
business. Competition has been intense in recent years and is expected to continue. If we
are unable to maintain a competitive advantage, loss of market share, revenue, or
profitability may result. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> Low demand for new products
and the inability to develop and introduce new products at favorable margins could
adversely impact our performance and prospects for future growth.</B> Our competitive
advantage is due in part to our ability to develop and introduce new products in a timely
manner at favorable margins. The uncertainties associated with developing and introducing
new products, such as market demand and costs of development and production, may impede
the successful development and introduction of new products on a consistent basis. Market
acceptance of the new products introduced in 2005 and scheduled for introduction in 2006
may not meet sales expectations due to various factors, such as our failure to accurately
predict market demand and evolving industry standards, to resolve technical challenges in
a timely and cost-effective manner, and to achieve manufacturing efficiencies. Our
investments in productive capacity and commitments to fund advertising and product
promotions in connection with these new products could be excessive if those expectations
are not met. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>9</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>The inability to generate
sufficient cash flows to support operations and other activities could prevent future
growth and success.</B> Our inability to generate sufficient cash flows to support capital
expansion, business acquisition plans, share repurchases and general operating activities
could negatively affect our operations and prevent our expansion into existing and new
markets. Our ability to generate cash flows is dependent in part upon obtaining necessary
financing at favorable interest rates. Interest rate fluctuations and other capital market
conditions may prevent us from doing so. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> Our success depends on our
ability to improve productivity and streamline operations to control or reduce costs.</B> We
are committed to continuous productivity improvement and continue to evaluate
opportunities to reduce fixed costs, simplify or improve processes, and eliminate excess
capacity. A description of our restructuring activity during the three years ended
December 31, 2005, is included in Note 20 of Notes to Consolidated Financial Statements
and in &#147;Management&#146;s Discussion and Analysis of Financial Condition and Results
of Operations&#148; beginning on page 15. The ultimate savings realized from restructuring
actions may be mitigated by many factors, including economic weakness, competitive
pressures, and decisions to increase costs in areas such as promotion or research and
development above levels that were otherwise assumed. Our failure to achieve projected
levels of efficiencies and cost reduction measures and to avoid delays in or unanticipated
inefficiencies resulting from manufacturing and administrative reorganization actions in
progress or contemplated would adversely affect our results of operations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>The inability to successfully
integrate the operations of acquired businesses or to identify new acquisition
opportunities could negatively impact our prospect for future growth and profitability.</B> We
expend significant resources on identifying opportunities to acquire new lines of business
and companies that could contribute to our success and expansion into existing and new
markets. Our inability to successfully identify acquisition opportunities, integrate the
operations of acquired businesses, or realize the anticipated cost savings, synergies and
other benefits related to the acquisition of those businesses could have a material
adverse effect on our business, financial condition and future growth. Acquisitions may
also have a material adverse effect on our operating results due to large write-offs,
contingent liabilities, substantial depreciation, or other adverse tax or audit
consequences. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> Failures of our infrastructure
could have a material adverse effect on our business.</B> We are heavily dependent on our
infrastructure. Significant problems with our infrastructure, such as manufacturing
failures, telephone or information technology (IT) system failure, computer viruses or
other third-party tampering with IT systems, could halt or delay manufacturing and hinder
our ability to ship in a timely manner or otherwise routinely conduct business. Any of
these events could result in the loss of customers, a decrease in revenue, or the
incurrence of significant costs to eliminate the problem or failure. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> Our products could be subject
to product liability claims and litigation.</B> We manufacture products that create exposure
to product liability claims and litigation. If our products are not properly manufactured
or designed, personal injuries or property damage could result, which could subject us to
claims for damages. The costs associated with defending product liability claims and
payment of damages could be substantial. Our reputation could also be adversely affected
by such claims, whether or not successful. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>Our products could be
recalled.</B> The Consumer Product Safety Commission or other applicable regulatory bodies may
require the recall, repair or replacement of our products if those products are found not
to be in compliance with applicable standards or regulations. A recall could increase
costs and adversely impact our reputation. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> We may have additional tax
liabilities.</B> We are subject to income taxes in the United States and numerous foreign
jurisdictions. Significant judgment is required in determining our worldwide provision for
income taxes. In the ordinary course of our business, there are many transactions and
calculations where the ultimate tax determination is uncertain. We are regularly under
audit by tax authorities. Although we believe our tax estimates are reasonable, the final
outcome of tax audits and any related litigation could be materially different than that
which is reflected in historical income tax provisions and accruals. Based on the status
of a given tax audit or related litigation, a material effect on our income tax provision
or net income may result in the period or periods from initial recognition in our reported
financial results to the final closure of that tax audit or settlement of related
litigation when the ultimate tax and related cash flow is known with certainty. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> We are subject to current
environmental and other laws and regulations.</B> We are subject to environmental laws in each
jurisdiction in which we conduct business. Some of our products incorporate substances
that are regulated in some jurisdictions in which we conduct manufacturing operations. We
could be subject to liability if we do not comply with these regulations. In addition, we
are currently and may, in the future, be held responsible for remedial investigations and
clean-up costs resulting from the discharge of hazardous substances into the environment,
including sites that have never been owned or operated by us but at which we have been
identified as a potentially responsible party under federal and state environmental laws
and regulations. Changes in environmental and other laws and regulations in both domestic
and foreign jurisdictions could adversely affect our operations due to increased costs of
compliance and potential liability for non-compliance. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>10</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>If our goodwill or
indefinite-lived intangible assets become impaired, we may be required to record a
significant charge to earnings.</B> Under United States generally accepted accounting
principles, goodwill and indefinite-lived intangible assets are not amortized but are
reviewed for impairment on an annual basis or more frequently whenever events or changes
in circumstances indicate that their carrying value may not be recoverable. We may be
required to record a significant charge to earnings in our financial statements during the
period in which any impairment of our goodwill or indefinite-lived intangible assets is
determined, resulting in an impact on our results of operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; <B>Changes in accounting may
affect our reported earnings.</B> For many aspects of our business, United States generally
accepted accounting principles, including pronouncements, implementation guidelines, and
interpretations, are highly complex and require subjective judgments. Changes in these
accounting principles, including their interpretation and application, could significantly
change our reported earnings, adding significant volatility to our reported results
without a comparable underlying change in our cash flows. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> We are exposed to adverse
changes in currency exchange rates, raw material commodity prices or interest rates, both
in absolute terms and relative to competitors&#146; risk profiles.</B> We have a number of
manufacturing sites throughout the world and sell our products in more than 100 countries.
As a result, we are exposed to movements in the exchange rates of various currencies
against the United States dollar and against the currencies of countries in which we have
manufacturing facilities. We believe our most significant foreign currency exposures are
the euro, pound sterling and Chinese renminbi. A decrease in the value of the euro and
pound sterling relative to the U.S. dollar could adversely affect our results of
operations. An increase in the value of the Chinese renminbi relative to the U.S. dollar
could adversely affect our results of operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> We operate a global business
that exposes us to additional risks.</B> Our sales outside of the United States accounted for
approximately 34% of our consolidated net revenue in 2005. We continue to expand into
foreign markets. The future growth and profitability of our foreign operations are subject
to a variety of risks and uncertainties, such as tariffs, nationalization, exchange
controls, interest rate fluctuations, civil unrest, governmental changes, limitations on
foreign investment in local business and other political, economic and regulatory risks
inherent in conducting business internationally. Over the past several years, such factors
have become increasingly important as a result of our higher percentage of manufacturing
in China, Mexico and the Czech Republic and purchases of products and components from
foreign countries. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;<B> Catastrophic events may
disrupt our business.</B> Unforeseen events, including war, terrorism and other international
conflicts, public health issues, and natural disasters such as earthquakes, hurricanes or
other adverse weather and climate conditions, whether occurring in the United States or
abroad, could disrupt our operations, disrupt the operations of our suppliers or
customers, or result in political or economic instability. These events could reduce
demand for our products and make it difficult or impossible for us to manufacture our
products, deliver products to customers, or to receive products from suppliers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
foregoing list is not exhaustive. There can be no assurance that we have correctly
identified and appropriately assessed all factors affecting our business or that the
publicly available and other information with respect to these matters is complete and
correct. Additional risks and uncertainties not presently known to us or that we currently
believe to be immaterial also may adversely impact our business. Should any risks or
uncertainties develop into actual events, these developments could have material adverse
effects on our business, financial condition, and results of operations. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 2. PROPERTIES</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation operates 44
manufacturing facilities around the world, including 24 located outside of the United
States in 10 foreign countries. The major properties associated with each business segment
are listed in &#147;Narrative Description of the Business&#148; in Item 1(c) of Part I of
this report. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following are the Corporation&#146;s major leased facilities: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the United States: Lake Forest, Mira Loma, and Rialto, California; Charlotte, North
Carolina; Jackson, Tennessee; Tampa, Florida; Chesterfield, Michigan; and Towson,
Maryland. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Outside
of the United States: Tongeren and Aarschot, Belgium; Reynosa and Mexicali, Mexico;
Brockville, Canada; Usti nad Labem, Czech Republic; Taichung, Taiwan; and Suzhou, China. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional
property both owned and leased by the Corporation in Towson, Maryland, is used for
administrative offices. Subsidiaries of the Corporation lease certain locations primarily
for smaller manufacturing and/or assembly operations, service operations, sales and
administrative offices, and for warehousing and distribution centers. The Corporation also
owns a manufacturing plant located on leased land in Suzhou, China. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Item 7 of Part II of this report under the caption
&#147;Restructuring Actions&#148;, during the fourth quarter of 2001, the Corporation
commenced actions on a restructuring plan that, among other matters, reduced its
manufacturing footprint. Additional actions under that restructuring plan were initiated
during the second half of 2003. In addition, during the fourth quarter of 2003, the
Cor-</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>11</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>poration commenced actions on a restructuring plan associated with the integration of
the acquired Baldwin and Weiser businesses into its security hardware business. In the
fourth quarter of 2004, the Corporation approved certain actions under a restructuring
plan associated with the integration of the acquired Porter-Cable and Delta Tools Group
into its Power Tools and Accessories business. The Corporation continues to evaluate its
worldwide manufacturing cost structure to identify opportunities to improve capacity
utilization and lower product costs and will take appropriate action as deemed necessary. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management
believes that its owned and leased facilities are suitable and adequate to meet the
Corporation&#146;s anticipated needs. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 3. LEGAL PROCEEDINGS</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation is involved in
various lawsuits in the ordinary course of business. These lawsuits primarily involve
claims for damages arising out of the use of the Corporation&#146;s products and
allegations of patent and trademark infringement. The Corporation also is involved in
litigation and administrative proceedings involving employment matters and commercial
disputes. Some of these lawsuits include claims for punitive as well as compensatory
damages. The Corporation, using current product sales data and historical trends,
actuarially calculates the estimate of its exposure for product liability. The Corporation
is insured for product liability claims for amounts in excess of established deductibles
and accrues for the estimated liability as described above up to the limits of the
deductibles. All other claims and lawsuits are handled on a case-by-case basis. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
previously noted under Item 1(c) of Part I of this report, the Corporation also is party
to litigation and administrative proceedings with respect to claims involving the
discharge of hazardous substances into the environment. Some of these assert claims for
damages and liability for remedial investigations and clean-up costs with respect to sites
that have never been owned or operated by the Corporation but at which the Corporation has
been identified as a PRP. Others involve current and former manufacturing facilities. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
EPA and the Santa Ana Regional Water Quality Board (the &#147;Water Quality Board&#148;)
have each initiated administrative proceedings against the Corporation and certain of the
Corporation&#146;s current or former affiliates alleging that the Corporation and numerous
other defendants are responsible to investigate and remediate alleged groundwater
contamination in and adjacent to a 160-acre property located in Rialto, California. The
cities of Colton and Rialto, as well as the West Valley Water District and the Fontana
Water Company, a private company, also have initiated lawsuits against the Corporation and
certain of the Corporation&#146;s former or current affiliates in the Federal District
Court for California, Central District alleging similar claims that the Corporation is
liable under CERCLA, the Resource Conservation and Recovery Act, and state law for the
discharge or release of hazardous substances into the environment and the contamination
caused by those alleged releases. All defendants have cross-claims against one another in
the federal litigation. The administrative proceedings and the lawsuits generally allege
that West Coast Loading Corporation (&#147;WCLC&#148;), a defunct company that operated in
Rialto between 1952 and 1957, and an as yet undefined number of other defendants are
responsible for the release of perchlorate and solvents into the groundwater basin that
supplies drinking water to the referenced three municipal water suppliers and one private
water company in California and that the Corporation and certain of the Corporation&#146;s
current or former affiliates are liable as a &#147;successor&#148; of WCLC. The
Corporation believes that neither the facts nor the law support an allegation that the
Corporation is responsible for the contamination and is vigorously contesting these
claims. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s estimate of costs associated with product liability claims,
environmental matters, and other legal proceedings is accrued if, in management&#146;s
judgment, the likelihood of a loss is probable and the amount of the loss can be
reasonably estimated. These accrued liabilities are not discounted. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the opinion of management, amounts accrued for exposures relating to product liability
claims, environmental matters, and other legal proceedings are adequate and, accordingly,
the ultimate resolution of these matters is not expected to have a material adverse effect
on the Corporation&#146;s consolidated financial statements. As of December 31, 2005, the
Corporation had no known probable but inestimable exposures relating to product liability
claims, environmental matters, or other legal proceedings that are expected to have a
material adverse effect on the Corporation. There can be no assurance, however, that
unanticipated events will not require the Corporation to increase the amount it has
accrued for any matter or accrue for a matter that has not been previously accrued because
it was not considered probable. While it is possible that the increase or establishment of
an accrual could have a material adverse effect on the financial results for any
particular fiscal quarter or year, in the opinion of management there exists no known
potential exposures that would have a material adverse effect on the financial condition
or on the financial results of the Corporation beyond any such fiscal quarter or year. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A054></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Not applicable. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>12</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A055></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=4><B>PART II</B> </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A056></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(a) Market Information</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s Common Stock
is listed on the New York Stock Exchange. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth, for the periods indicated, the high and low sale prices of the
Common Stock as reported in the consolidated reporting system for the New York Stock
Exchange Composite Transactions: </FONT></P>



<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM">
     <TD ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">QUARTER</FONT></TD>
     <TH ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"> 2005</FONT></TH>
     <TD ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">  2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN="TOP">
     <TD WIDTH="34%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">January to March
</FONT></TD>
     <TD WIDTH="33%" ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>$89.750 to $77.180</B></FONT></TD>
     <TD WIDTH="33%" ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$56.590 to $48.070</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">April to June
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B> $91.450 to $77.850</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$61.500 to $54.440</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">July to September
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>$93.710 to $80.030</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$75.200 to $59.090</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">October to December
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B> $89.000 to $75.700</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$89.640 to $72.090</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A057></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(b) Holders of the
Corporation&#146;s Capital Stock</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As of January 27, 2006, there were
11,884 holders of record of the Corporation&#146;s Common Stock. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A058></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(c) Dividends</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation has paid consecutive
quarterly dividends on its Common Stock since 1937. Future dividends will depend upon the
Corporation&#146;s earnings, financial condition, and other factors. The Credit Facility,
as more fully described in Note 8 of Notes to Consolidated Financial Statements included
in Item 8 of Part II of this report, does not restrict the Corporation&#146;s ability to
pay regular dividends in the ordinary course of business on the Common Stock. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Quarterly
dividends per common share for the most recent two years are as follows: </FONT></P>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM">
     <TD ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">QUARTER</FONT></TD>
     <TH ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"> 2005</FONT></TH>
     <TD ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">  2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN="TOP">
     <TD WIDTH="34%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">January to March
</FONT></TD>
     <TD WIDTH="33%" ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>$&nbsp;&nbsp;.28</B></FONT></TD>
     <TD WIDTH="33%" ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$&nbsp;.21</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">April to June
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>.28</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">.21</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">July to September
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>.28</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">.21</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">October to December
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>.28</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">.21</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;
</FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>$1.12</B></FONT></TD>
     <TD ALIGN="Right" VALIGN="Bottom"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$&nbsp;.84</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A059></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Common Stock:</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>150,000,000 shares authorized, $.50
par value, 77,357,370 and 82,095,161 outstanding as of December 31, 2005 and 2004,
respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A060></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Preferred Stock:</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5,000,000 shares authorized, without
par value, no shares outstanding as of December 31, 2005 and 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A061></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(d) Annual Meeting of
Stockholders</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The 2006 Annual Meeting of
Stockholders of the Corporation is scheduled to be held on April 20, 2006, at 9:00 a.m. at
the Sheraton Baltimore North Hotel, 903 Dulaney Valley Road, Towson, Maryland 21204. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>13</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A062></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(e) Issuer Purchases of
Equity Securities</B> </FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">

<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>PERIOD (a)</B></FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;<B>TOTAL NUMBER<BR>
OF SHARES<BR>PURCHASED</B>
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;<B>AVERAGE<BR>PRICE
PAID<BR>PER SHARE</B>
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;&nbsp;<B>TOTAL NUMBER<BR>OF SHARES<BR>PURCHASED
AS<BR>PART OF PUBLICLY<BR>ANNOUNCED PLANS(b)<BR></B>
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>MAXIMUM NUMBER<BR>OF SHARES<BR>THAT MAY
YET<BR>BE PURCHASED<BR>UNDER THE PLANS</B>
</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN="LEFT" WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>October 3, 2005 through October 30, 2005</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT" WIDTH="3%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="9%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100,00</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="11%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$&nbsp;&nbsp;&nbsp;&nbsp;81.5</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="14%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100,00</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="14%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5,198,79</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>October 31, 2005 through November 27, 2005</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>909,30</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$&nbsp;&nbsp;&nbsp;&nbsp;82.4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>909,30</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,289,49</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>November 28, 2005 through December 31, 2005</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>220,70</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$&nbsp;&nbsp;&nbsp;&nbsp;84.9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>220,70</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,068,79</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,230,00</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$&nbsp;&nbsp;&nbsp;&nbsp;82.8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,230,00</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,068,79</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The periods represent the Corporation&#146;s monthly fiscal calendar. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    All purchases by the Corporation of its common stock were made under the
                    following publicly announced repurchase plan: (1) on February 10, 2005, the
                    Corporation announced it had authorization from its Board of Directors to
                    repurchase 2,500,000 shares, and (2) on October 14, 2005, the Corporation
                    announced it had authorization from its Board of Directors to repurchase an
                    additional 5,000,000 shares. There is no expiration date or current intent to
                    terminate the repurchase plans. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 6. SELECTED FINANCIAL DATA</B></FONT></P>

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<A NAME=A063></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>FIVE-YEAR SUMMARY</B> </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN=3 ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>(MILLIONS OF DOLLARS EXCEPT PER SHARE DATA)
</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004 </FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003(b)</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2002 (b)(c)</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2001 (b)</FONT></TD></TR>
<TR>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=42% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>6,523.</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    5,398.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    4,482.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    4,291.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD WIDTH=10% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    4,139.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>544.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>441.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>287.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>228.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>101.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Loss) earnings from discontinued operations (a)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>543.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>456.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>293.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>229.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>108.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Basic earnings per share:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Net earnings per common share - basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Diluted earnings per share:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Net earnings per common share - assuming dilution</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5,816.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5,530.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,222.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,130.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,014.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,030.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,200.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>915.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>927.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,191.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Redeemable preferred stock of subsidiary (d)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>192.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>202.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>208.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>196.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash dividends per common share</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>



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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    (Loss) earnings from discontinued operations represent the earnings, net of
                    applicable income taxes, of the Corporation&#146;s discontinued European
                    security hardware business. Loss from discontinued operations for the year ended
                    December 31, 2005, includes a loss on sale of discontinued operations of $.1
                    million.  Earnings
from discontinued operations for the year ended December 31, 2004, include a gain on sale
of discontinued of operations of $12.7 million. That gain was net of a $24.4 million
goodwill impairment charge associated with the DOM security hardware business. The
earnings of the discontinued operations do not reflect any expense for interest allocated
by or management fees charged by the Corporation. For additional information about the
discontinued European security hardware business, see Note 3 of Notes to Consolidated
Financial Statements included in Item 8 of Part II of this report. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>
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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    As more fully disclosed in Note 20 of Notes to Consolidated Financial Statements
                    included in Item 8 of Part II of this report, under a restructuring program
                    developed by the Corporation in the fourth quarter of 2001, earnings from
                    continuing operations for 2003, 2002, and 2001 include a restructuring charge of
                    $20.6 million, $46.6 million, and $99.7 million before taxes, respectively
                    ($14.9 million, $29.2 million, and $70.6 million after taxes, respectively).
                    Those 2003, 2002, and 2001 pre-tax charges were net of reversals of $13.2
                    million, $11.0 million, and $4.1 million, respectively, representing reversals
                    of previously provided restructuring reserves as well as the excess proceeds
                    received on the sale of long-lived assets, written down as part of restructuring
                    actions, over their adjusted carrying values. In addition, earnings from
                    continuing operations for 2003 include a restructuring charge of $11.0 million
                    before taxes ($7.2 million after taxes) associated with the closure of a
                    manufacturing facility in its Hardware and Home Improvement segment as a result
                    of the acquisition of the Baldwin and Weiser businesses. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    As more fully disclosed in Note 1 of Notes to Consolidated Financial Statements
                    included in Item 8 of Part II of this report, effective January 1, 2002, the
                    Corporation adopted Statement of Financial Accounting Standards (SFAS) No. 142,
                    <I>Goodwill and Other </I> <I>Intangible Assets</I>. Effective January 1, 2002,
                    goodwill is no longer amortized by the Corporation. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    As of December 31, 2004, redeemable preferred stock of subsidiary was included
                    in other current liabilities. As of December 31, 2000 through 2003, redeemable
                    preferred stock of subsidiary was included in other long-term liabilities. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>14</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B></FONT></P>
<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A064></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Overview</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation is a global
manufacturer and marketer of power tools and accessories, hardware and home improvement
products, and technology-based fastening systems. As more fully described in Note 18 of
Notes to Consolidated Financial Statements, the Corporation operates in three reportable
business segments &#150; Power Tools and Accessories, Hardware and Home Improvement, and
Fastening and Assembly Systems &#150; with these business segments comprising 74%, 16%,
and 10%, respectively, of the Corporation&#146;s sales in 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation markets its products and services in over 100 countries. During 2005,
approximately 66%, 21%, and 13% of its sales were made to customers in the United States,
in Europe (including the United Kingdom), and in other geographic regions, respectively.
The Power Tools and Accessories and Hardware and Home Improvement segments are subject to
general economic conditions in the countries in which they operate as well as the strength
of the retail economies. The Fastening and Assembly Systems segment is also subject to
general economic conditions in the countries in which it operates as well as to automotive
and industrial demand. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reported net earnings of $543.9 million, or $6.69 per share on a diluted
basis, for the year ended December 31, 2005, compared to net earnings of $456.0 million,
or $5.59 per share on a diluted basis, for the year ended December 31, 2004. As more fully
described in Note 3 of Notes to Consolidated Financial Statements included in Item 8 of
Part II of this report, net earnings for the year ended December 31, 2005, included a $.1
million loss on the sale of discontinued operations. Net earnings for the year ended
December 31, 2004, included a $12.7 million gain on the sale of discontinued operations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reported net earnings from continuing operations of $544.0 million, or $6.69
per share on a diluted basis, for the year ended December 31, 2005, as compared to net
earnings from continuing operations of $441.1 million, or $5.40 per share on a diluted
basis, for the year ended December 31, 2004. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
consolidated sales of $6,523.7 million for the year ended December 31, 2005, increased by
21% over the prior year&#146;s level. Of that 21% increase, 7% was attributable to an
increase in unit volume of existing businesses, 14% was attributable to sales of acquired
businesses, and 1% was attributable to the favorable impact of foreign currency
translation, offset by 1% attributable to the negative effect of pricing actions. In this
Management&#146;s Discussion and Analysis, the Corporation has attempted to differentiate
between sales of its &#147;existing&#148; or &#147;legacy&#148; businesses and sales of
acquired businesses. That differentiation includes sales of businesses where year-to-year
comparability exists in the category of &#147;existing&#148; or &#147;legacy&#148;
businesses. For example, the sales of the MasterFix business, acquired in March 2004, are
included in acquired businesses for the first three months of 2005 and in
&#147;existing&#148; or &#147;legacy&#148; businesses for the final nine months of 2005.
In addition, the sales of the Porter-Cable and Delta Tools Group (also referred to herein
as the Tools Group), acquired in the fourth quarter of 2004, are included in acquired
businesses for the first nine months of 2005 and in &#147;existing&#148; or
&#147;legacy&#148; businesses for the final three months of 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating
income for the year ended December 31, 2005, increased to $813.1 million, or 12.5% of
sales, from $629.2 million, or 11.7% of sales, in 2004. Due to the ongoing integration of
the acquired Porter-Cable and Delta Tools Group into its legacy businesses, the
Corporation has been required to use judgment in its determination of the individual
profit contributions of the acquired Porter-Cable and Delta Tools Group and of its legacy
businesses. The Corporation estimates that operating income as a percentage of sales
increased approximately 110 basis points in the Corporation&#146;s legacy businesses
during the year ended December 31, 2005, as compared to the prior year&#146;s level, but
that increase was offset by the lower-margin Tools Group. The increase in operating income
as a percentage of sales during the year ended December 31, 2005, was due to the positive
effects of restructuring and other productivity initiatives, favorable product mix, and
the leverage of fixed costs over a higher sales base, which offset higher commodity costs
and the negative impact of pricing. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Earnings
from continuing operations before income taxes for the year ended December 31, 2005,
increased by $215.0 million over the 2004 level to $819.3 million. In addition to the
improvements in operating income described above, earnings from continuing operations
before income taxes for the year ended December 31, 2005, benefited from a favorable $55.0
million settlement of environmental and product liability coverage litigation with an
insurer that is included in other (income) expense in the Consolidated Statement of
Earnings. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>15</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
income tax expense of $275.3 million and $163.2 million was recognized on the
Corporation&#146;s earnings from continuing operations before income taxes of $819.3
million and $604.3 million for 2005 and 2004, respectively. The Corporation&#146;s
effective tax rate was 34% for 2005, compared to an effective tax rate of 27% for 2004.
The increase in the Corporation&#146;s effective tax rate in 2005 was due to the
incremental tax expense of $51.2 million associated with the repatriation of foreign
earnings under the American Jobs Creation Act of 2004 and to the tax effects &#150; $19.2
million &#150; of the $55.0 million of income recognized upon settlement of environmental
and product liability coverage litigation with an insurer. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the discussion and analysis of financial condition and results of operations that follows,
the Corporation generally attempts to list contributing factors in order of significance
to the point being addressed. </FONT></P>

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<A NAME=A065></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Sales</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The following chart provides an
analysis of the consolidated changes in sales for the years ended December 31, 2005, 2004,
and 2003. </FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="9" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
YEAR ENDED DECEMBER 31,</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(DOLLARS IN MILLIONS)</FONT></TD>
     <TD COLSPAN="1" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TD>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="1" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="1" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="46%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total sales</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="16%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$   6,523.7</B></FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$   5,398.4</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$   4,482.7</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=Black SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unit volume - existing (a)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unit volume - acquired (b)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>14</B>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Price</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1)</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Currency</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=Black SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Change in total sales</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>21</B>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Represents change in unit volume for businesses where year-to-year comparability
                    exists. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Represents change in unit volume for businesses that were acquired and were not
                    included in prior period results.  </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total consolidated sales for the year ended
                    December 31, 2005, were $6,523.7 million, which represented a 21% increase over
                    2004 sales of $5,398.4 million. Excluding
the incremental effects of the MasterFix business for the first three months of 2005 and
of the Porter-Cable and Delta Tools Group business for the first nine months of 2005,
total unit volume increased by 7% during the year ended December 31, 2005. That 7%
increase was primarily driven by growth in the Corporation&#146;s professional power tools
and plumbing products businesses in the United States. Unit volume of acquired businesses
contributed 14% to the sales growth for 2005 over the 2004 levels. Pricing actions had a
1% negative effect on sales for 2005, as compared to 2004. The effects of a weaker U.S.
dollar compared to other currencies, particularly the Canadian dollar, Brazilian real, and
euro, caused the Corporation&#146;s consolidated sales for 2005 to increase by 1% over the
2004 levels. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
consolidated sales for the year ended December 31, 2004, were $5,398.4 million, which
represented a 20% increase over 2003 sales of $4,482.7 million. Excluding the incremental
effects of the MasterFix and Porter-Cable and Delta Tools Group businesses, acquired in
2004, and of the Baldwin and Weiser businesses, acquired in the fourth quarter of 2003,
for the first nine months of 2004, total unit volume increased by 10% during the year
ended December 31, 2004. That 10% increase was primarily attributable to growth in the
Corporation&#146;s North American businesses. As compared to the corresponding period in
2003, a double-digit increase in sales volume was experienced by the Corporation&#146;s
legacy professional power tools and accessories business as well as its plumbing products
business in North America. Unit volume of acquired businesses contributed 9% to the sales
growth for 2004 over the 2003 levels. Pricing actions had a 2% negative effect on sales
for 2004, as compared to 2003. In addition to pricing actions taken in response to
competitive conditions, the impact of pricing in non-U.S. markets during 2004 &#150; as a
result of the favorable currency effects of U.S. dollar-sourced products &#150; also
negatively impacted the comparison to 2003. The effects of a weaker U.S. dollar compared
to other currencies, particularly the euro, and to a lesser degree, the pound sterling,
caused the Corporation&#146;s consolidated sales to increase by 3% over the 2004 levels. </FONT></P>

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<A NAME=A066></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Earnings </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation reported consolidated
operating income of $813.1 million on sales of $6,523.7 million in 2005, compared to
operating income of $629.2 million on sales of $5,398.4 million in 2004 and to operating
income of $428.7 million on sales of $4,482.7 million in 2003. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
operating income for 2003 included a pre-tax restructuring charge of $31.6 million. That
pre-tax charge was net of reversals of $13.2 million, representing reversals of previously
provided restructuring reserves as well as the excess of proceeds received on the sale of
long-lived assets, written down as part of restructuring actions, over their adjusted
carrying values. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
gross margin as a percentage of sales for 2005 was 35.5%, compared to 36.4% for 2004. Due
to the ongoing integration of the acquired Porter-Cable and Delta Tools Group into its
legacy businesses, the Corporation has been required to use judgment in its determination
of the individual profit contributions of the acquired Porter-Cable and Delta Tools Group
and of its legacy businesses. The Corporation estimates that the Tools Group acquisition
had an approximate 150 basis point negative impact on consolidated gross margin as a
percentage of sales for the year ended</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>16</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2> December 31, 2005. In addition to favorable product
mix, the results of restructuring and other productivity initiatives, the leverage of
fixed costs over a higher sales base, and foreign currency effects favorably impacted
gross margin as a percentage of sales in the Corporation&#146;s legacy businesses. These
positive factors were partially offset by increased raw material costs, the negative
effects of pricing actions, higher pension expense, and transition costs associated with integration of lockset
operations in the Hardware and Home Improvement segment. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
gross margin as a percentage of sales for 2004 was 36.4%, compared to 35.6% for 2003. The
increase in gross margin in 2004 was attributable to the positive effects of restructuring
and other productivity initiatives, the leverage of fixed costs over a higher sales base
and, in Europe, favorable foreign currency exchange rates. These positive factors were
partially offset by the negative effect of pricing actions taken by the Corporation as
previously described, by higher raw material and pension costs, and by lower gross margins
of the acquired Porter-Cable and Delta Tools Group. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
selling, general and administrative expenses as a percentage of sales were 23.1% in 2005,
compared to 24.8% in 2004 and 25.3% in 2003. Selling, general, and administrative expenses
in 2005 increased by $167.7 million over the 2004 level. The effects of acquired
businesses and foreign currency translation accounted for approximately two-thirds of that
increase, with the remainder principally resulting from additional sales-related expenses
associated with the higher level of sales experienced during 2005. The reduction in
selling, general, and administrative expenses as a percentage of sales during 2005 as
compared to the 2004 level was principally due to the impact of the Tools Group
acquisition &#150; due to the lower expenses of this business &#150; and the leverage of
expenses over a higher sales base in the Corporation&#146;s legacy businesses. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
selling, general, and administrative expenses in 2004 increased by $201.0 million over the
2003 level. The incremental expenses of the acquired businesses and the effects of foreign
currency translation accounted for approximately 40% and 20% of that increase,
respectively. Higher promotional, marketing, and research and development expenses,
particularly in the North American power tools and accessories business, higher
transportation and distribution expenses to support the increased sales level, and higher
Corporate expenses &#150; driven by expenses related to stock-based compensation and
compliance with Section 404 of the Sarbanes-Oxley Act &#150; accounted for much of the
remaining increase in selling, general, and administrative expenses in 2004 over the 2003
level. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
net interest expense (interest expense less interest income) was $45.4 million in 2005,
compared to $22.1 million in 2004 and $35.2 million in 2003. The increase in net interest
expense in 2005, as compared to 2004, was primarily the result of both higher borrowing
levels &#150; associated with the October 2004 issuance of $300.0 million of 4.75% senior
notes &#150; and higher interest rates, including the effects of higher prevailing U.S.
interest rates on the Corporation&#146;s foreign currency hedging activities. The lower
net interest expense in 2004, as compared to 2003, was primarily the result of higher
interest income associated with the Corporation&#146;s foreign cash investment activities
in 2004, coupled with lower borrowing levels. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other
(income) expense was $(51.6) million in 2005 compared to $2.8 million in 2004 and $2.6
million in 2003. As more fully described in Note 21 of Notes to Consolidated Financial
Statements, the Corporation received a payment of $55.0 million in 2005 relating to the
settlement of environmental and product liability coverage litigation with an insurer. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
income tax expense of $275.3 million, $163.2 million, and $103.7 million was recognized on
the Corporation&#146;s earnings from continuing operations before income taxes of $819.3
million, $604.3 million, and $390.9 million, for 2005, 2004, and 2003, respectively. The
Corporation&#146;s effective tax rate was 34% for 2005, compared to an effective tax rate
of 27% for 2004 and 2003. The increase in the Corporation&#146;s effective tax rate in
2005 was due to the incremental tax expense of $51.2 million associated with the
repatriation of foreign earnings under the American Jobs Creation Act of 2004 and to the
tax effects &#150; $19.2 million &#150; of the $55.0 million of income recognized upon
settlement of environmental and product liability coverage litigation with an insurer. A
further analysis of taxes on earnings is included in Note 12 of Notes to Consolidated
Financial Statements. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reported net earnings from continuing operations of $544.0 million, or $6.69
per share on a diluted basis, for the year ended December 31, 2005, compared to net
earnings from continuing operations of $441.1 million, or $5.40 per share on a diluted
basis, for the year ended December 31, 2004, and $287.2 million, or $3.68 per share on a
diluted basis, for the year ended December 31, 2003. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reported a net loss of $.1 million from discontinued operations in 2005, as
compared to net earnings from discontinued operations of $14.9 million in 2004 and $5.8
million in 2003. As more fully described in Note 3 of Notes to Consolidated Financial
Statements, net earnings from discontinued operations for the years ended December 31,
2005 and 2004, included a $.1 million loss and a $12.7 million gain, respectively, on sale
of discontinued operations. The $.1 million loss recognized in 2005 related to the sale of
the discontinued DOM business. The $12.7 million</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>17</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2> gain recognized during 2004 consisted of
a $37.1 million gain on the sale of two discontinued businesses (NEMEF and Corbin) in
early 2004, partially offset by a $24.4 million goodwill impairment charge associated with
the discontinued DOM business. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reported net earnings of $543.9 million, $456.0 million, and $293.0 million,
or $6.69, $5.59, and $3.75 per share on a diluted basis, for the years ended December 31,
2005, 2004, and 2003, respectively. </FONT></P>

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<A NAME=A067></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Business Segments</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As more fully described in Note 18 of
Notes to Consolidated Financial Statements, the Corporation operates in three reportable
business segments: Power Tools and Accessories, Hardware and Home Improvement, and
Fastening and Assembly Systems. </FONT></P>

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<A NAME=A068></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>POWER TOOLS AND
ACCESSORIES</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment sales and profit for the
Power Tools and Accessories segment, determined on the basis described in Note 18 of Notes
to Consolidated Financial Statements, were as follows (in millions of dollars): </FONT></P>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31,</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT" WIDTH="46%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="16%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>4,768</B></FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,796</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,322</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>635</B></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>492</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>371</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
</TABLE>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Power Tools and Accessories segment during 2005 increased
26% over the 2004 level. The incremental effect of the acquired Porter-Cable and Delta
Tools Group business for the first nine months of 2005 accounted for 19 percentage points
of the 26% increase in 2005, while sales of the legacy Power Tools and Accessories
businesses, including the acquired Porter-Cable and Delta Tools Group for the final three
months of 2005, accounted for the remaining 7 percentage points of growth. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in North America increased 36% during 2005 over the prior year&#146;s level. Of this
increase, 27 percentage points were due to the incremental sales of the acquired
Porter-Cable and Delta Tools Group businesses for the first nine months of 2005 and the
remaining 9 percentage points were due to the legacy power tools and accessories business.
Sales of the Corporation&#146;s legacy professional power tools and accessories business
in North America increased at a double-digit rate over the 2004 levels. Sales of the
Corporation&#146;s legacy consumer power tools and accessories business increased at a
mid-single-digit rate as a result of higher sales of consumer power tools and accessories,
lawn and garden products, and cleaning and lighting products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in Europe during 2005 increased at a mid-single-digit rate over the 2004 levels due to the
incremental effect of the acquired Porter-Cable and Delta Tools Group. Excluding the
incremental effect of the acquired Tools Group, sales in Europe increased slightly over
the 2004 level. Sales of the Corporation&#146;s legacy professional tools and accessories
business in Europe during 2005 increased at a low single-digit rate as compared to 2004 as
weaker economic conditions in the United Kingdom mitigated growth in other regions. Sales
of the Corporation&#146;s legacy consumer power tools and accessories businesses in Europe
during 2005 approximated sales in the prior year. In November 2005, the Corporation sold
the FLEX business, the major European component of the Porter-Cable and Delta Tools Group. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in other geographic areas increased at a double-digit rate during 2005 over the 2004
levels. That increase resulted from a double-digit rate of increase in Latin America and
Asia, which was partially offset by a high single-digit rate of decline in Australia. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Power Tools and Accessories segment was 13.3% for
2005, as compared to 13.0% in 2004. That increase in segment profit as a percentage of
sales resulted from a reduction in selling, general, and administrative expenses as a
percentage of sales partially offset by a lower gross margin as a percentage of sales. The
reduction in selling, general, and administrative expenses as a percentage of sales was
attributable to both the impact of the Tools Group acquisition &#150; due to the lower
expenses of this business &#150; and the leverage of expenses over a higher sales base in
the Corporation&#146;s legacy businesses. Gross margin as a percentage of sales declined
during 2005 as compared to 2004 as the impact of the lower-margin Tools Group offset
improvements in gross margin as a percentage of sales in the Corporation&#146;s legacy
businesses. Gross margin improved in the legacy businesses in 2005 due to favorable
product mix, productivity gains, foreign currency effects, restructuring savings, and
absorption benefits, which offset the negative effects of pricing actions and raw material
inflation. Due to the ongoing integration of the acquired Porter-Cable and Delta Tools
Group into its legacy businesses, the Corporation has been required to use judgment in its
determination of the individual profit contributions of the acquired Porter-Cable and
Delta Tools Group and of its legacy businesses. The Corporation estimates that the Tools
Group acquisition had an approximate 60 basis point negative impact on segment profit as a
percentage of sales for 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Power Tools and Accessories segment during 2004 increased
14% over the 2003 level. Sales of the Porter-Cable and Delta Tools Group businesses
acquired early in the fourth</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>18</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>quarter of 2004, accounted for 7 percentage points of the 14%
increase in 2004, while sales of the legacy Power Tools and Accessories businesses
accounted for the remaining 7 percentage points of growth. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in North America increased at a double-digit rate during 2004 over the prior year&#146;s
level. Approximately half of this increase was due to the incremental sales of the
acquired Porter-Cable and Delta Tools Group businesses. Sales of the Corporation&#146;s
legacy professional power tools and accessories business in North America increased at a
double-digit rate as sales grew in all major channels and product lines. Sales of the
Corporation&#146;s consumer power tools and accessories business grew at a
mid-single-digit rate during 2004, compared to 2003, as increased sales of consumer power
tools and lawn and garden products were partially offset by lower sales of accessories and
cleaning and lighting products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in Europe during 2004 increased at a low single-digit rate due to the incremental sales of
FLEX, a component of the acquired Porter-Cable and Delta Tools Group business, and a high
single-digit rate of increase in sales of the Corporation&#146;s legacy European
professional power tools and accessories business. These increases were partially offset
by a low single-digit rate of decrease in sales of consumer power tools and accessories,
largely as a result of lower sales of lawn and garden products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
in other geographic areas increased at a double-digit rate during 2004 over the 2003
levels. Sales of the Corporation&#146;s legacy power tools and accessories businesses in
other geographic areas during 2004 increased at a high single-digit rate over the prior
year&#146;s level as sales increased at a high single-digit rate in Central and South
America and at a double-digit rate in Asia. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Power Tools and Accessories segment improved from
11.2% in 2003 to 13.0% in 2004. That improvement resulted from an increase in gross margin
and a reduction in selling, general, and administrative expenses, both as a percentage of
sales. Improvements in gross margin as a percentage of sales were due to the positive
effects of restructuring and other productivity initiatives, favorable product mix, and
foreign currency effects, partially offset by the negative effects of pricing actions and,
to a lesser extent, rising raw material costs. The reduction in selling, general, and
administrative expenses as a percentage of sales was principally due to the impact of the
Porter-Cable and Delta Tools Group acquisition. The acquisition of the lower-margin
Porter-Cable and Delta Tools Group early in the fourth quarter of 2004 had an approximate
40-basis-point negative impact on segment profit as a percentage of sales for the year
ended December 31, 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A069></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>HARDWARE AND HOME
IMPROVEMENT</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment sales and profit for the
Hardware and Home Improvement segment, determined on the basis described in Note 18 of
Notes to Consolidated Financial Statements, were as follows (in millions of dollars): </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31,</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> <B>2005</B></FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>1,012</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   963</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   719</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>143</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>146</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>93</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Hardware and Home Improvement segment increased 5% during
2005 over the 2004 level. During 2005, sales of plumbing products increased at a
double-digit rate over the 2004 level due to increased listings at a significant customer
and strong sales at other retailers. Sales of security hardware products in 2005 increased
slightly over the 2004 level, as a mid-single-digit rate of increase in sales of the
Kwikset business in North America was substantially offset by a mid-single-digit rate of
decline in sales of the Baldwin and Weiser businesses. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Hardware and Home Improvement segment was 14.2%
for 2005 and 15.2% for 2004. The decline in segment profit as a percentage of sales in
2005 was attributable to a decline in gross margin, which was primarily due to the
negative effects of pricing actions, higher raw material costs, and transition costs
associated with the integration of lockset operations, including the closure of a
manufacturing site. Gross margin for 2005 was also negatively impacted by the write-down
of property and equipment. Selling, general, and administrative expenses as a percentage
of sales decreased slightly in 2005, as compared to the 2004 level, due to the leverage of
expenses over a higher sales base, which was
partially offset by increased distribution and transportation costs. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Hardware and Home Improvement segment increased 34%
during 2004 over the 2003 level. During 2004, the impact of the Baldwin and Weiser
acquisition accounted for 25 percentage points of the 34% increase, while higher sales of
the Price Pfister and Kwikset businesses, coupled with sales growth in the Baldwin and
Weiser businesses after the anniversary of the acquisition, accounted for the remaining 9
percentage points. Sales of plumbing products increased at a double-digit rate during
2004, reflecting the expansion of listings at a key retailer that occurred during the
third quarter of 2003 as well as higher sales at other retailers. Sales of Kwikset
security hardware products increased over the 2003 level at a mid-single-digit rate due to
strong retail sales. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>19</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Hardware and Home Improvement segment rose to
15.2% for 2004 from 13.0% for 2003. Segment profit as a percentage of sales for 2004
benefited from significant gross margin improvement. That gross margin improvement was
primarily driven by volume leverage and productivity improvements, partially offset by the
impact of higher raw material costs as well as costs associated with manufacturing
rationalization in the security hardware business. The acquisition of Baldwin and Weiser
did not have a significant effect on segment profit as a percentage of sales during 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A070></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>FASTENING AND ASSEMBLY
SYSTEMS</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment sales and profit for the
Fastening and Assembly Systems segment, determined on the basis described in Note 18 of
Notes to Consolidated Financial Statements, were as follows (in millions of dollars): </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31,</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> <B>2005</B></FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>659</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   617</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   558</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>95</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>85</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>83</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
</TABLE>
<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Fastening and Assembly Systems segment increased by 7% in
2005 over the 2004 level, with the incremental sales of the MasterFix business for the
first three months of 2005 accounting for 1 percentage point of that increase. Sales in
the automotive channel in North America increased at a mid-single-digit rate over the
level experienced in 2004. Sales in the industrial channel in North America decreased at a
low single-digit rate, as compared to 2004. Sales in Europe increased at a double-digit
rate, as compared to 2004. Sales in the European industrial business increased at a high
single-digit rate of growth &#150; due in part, to incremental sales of the acquired
MasterFix business &#150; during 2005 over the 2004 level. Sales in the European
automotive business increased at a double-digit rate during 2005 over the 2004 level.
Sales in Asia during 2005 increased at a double-digit rate, as compared to 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Fastening and Assembly Systems segment increased
from 13.8% in 2004 to 14.4% in 2005. The increase in segment profit as a percentage of
sales was attributable to the positive effects of pricing actions and the leverage of
expenses over a higher sales base, partially offset by higher commodity costs. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to unaffiliated customers in the Fastening and Assembly Systems segment increased by 11%
in 2004 over the 2003 level. During March 2004, the Corporation completed the acquisition
of MasterFix, an industrial fastening company with operations in Europe and Asia.
Incremental sales of the MasterFix business accounted for 3 percentage points of the 11%
increase in 2004. Sales in North America during 2004 increased at a high single-digit rate
over the 2003 level, with increases in both the industrial and automotive channels. Sales
in Europe during 2004 increased over the 2003 level at a double-digit rate, due largely to
the incremental sales of the MasterFix business. The Fastening and Assembly System
segment&#146;s legacy European industrial business experienced a mid-single-digit rate of
growth during 2004 as compared to 2003, while sales in its legacy European automotive
business approximated the 2003 level. Sales in the segment&#146;s legacy businesses in
Asia increased at a double-digit rate in 2004, as compared to 2003. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit as a percentage of sales for the Fastening and Assembly Systems segment declined
from 14.9% in 2003 to 13.8% in 2004, primarily due to significant costs increases in steel
and other raw materials. The incremental impact of the MasterFix business did not have a
significant effect on segment profit as a percentage of sales of the Fastening and
Assembly Systems segment during 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A071></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OTHER SEGMENT-RELATED
MATTERS </B></FONT></P>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As indicated in the first table of
Note 18 of Notes to Consolidated Financial Statements, segment profit (loss) associated
with Corporate, Adjustments, and Eliminations was $(72.6) million, $(97.7) million, and
$(78.4) million for the years ended December 31, 2005, 2004, and 2003, respectively.
Corporate expenses for the year ended December 31, 2005, declined from the prior
year&#146;s level as the positive effects of increased allocations of Corporate expenses
to the reportable business segments to reflect the impact of acquired businesses, lower expenses associated with
intercompany eliminations, and a lower
level of expenses directly related to the reportable business segments offset the negative effects of increased pension,
postretirement benefits, and environmental expenses. Corporate expenses for the year ended December 31, 2004, increased over that
experienced in 2003 as the positive effects of lower levels of medical-related expenses and expenses directly related to reportable
business segments, coupled with increased allocations of Corporate expenses to the business segments to reflect the impact of
acquired businesses, were offset by the negative effects of increased expenses for pensions, postretirement benefits, and stock-based
compensation, as well as higher expenses associated with intercompany eliminations and compliance with Section 404 of the
Sarbanes-Oxley Act.
 </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 18 of Notes to Consolidated Financial Statements, in
determining segment profit, expenses relating to pension and other postretirement benefits
are based solely upon estimated service costs. Also, as more fully described herein under
the caption &#147;Financial Condition&#148;, expense recognized by the Corporation in 2005
relating to its pension and other postretirement benefits increased by approximately $19
million over the 2004 levels. Expense recognized by the Corporation in 2004 relating to
its pension and other postretirement benefits increased by approximately $19 million over
the 2003 levels. The adjustment to businesses&#146; postretirement benefit expense booked
in consolidation as identified in the second table</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>20</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>included in Note 18 of Notes to
Consolidated Financial Statements was expense of $13.8 million in 2005, as compared to
income of $.8 million and $15.4 million for 2004 and 2003, respectively. That increase in
expense resulted from the higher level of pension and other postretirement benefit
expenses in 2005 &#150; exclusive of higher service costs reflected in segment profit of
the Corporation&#146;s reportable business segments &#150; not allocated to the reportable
business segments. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income
(expenses) directly related to reportable business segments booked in consolidation and,
thus, excluded from segment profit for the reportable business segments were $3.3 million,
$(10.0) million, and $(15.0) million for the years ended December 31, 2005, 2004, and
2003, respectively. The $3.3 million of segment-related income excluded from segment
profit in 2005 principally related to a reduction in reserves for certain legal matters
associated with the Power Tools and Accessories and Hardware and Improvement segments. The
$(10.0) million of segment-related expense excluded from segment profit in 2004
principally related to restructuring-related expenses associated with the Hardware and
Home Improvement and Power Tools and Accessories segments. The $15.0 million of
segment-related expenses excluded from segment profit in 2003 principally related to
restructuring-related expenses associated with the Power Tools and Accessories segment of
approximately $9.1 million, as well as certain reserves established relating to the Power
Tools and Accessories and Hardware and Home Improvement segments. </FONT></P>




<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
indicated in Note 18 of Notes to Consolidated Financial Statements, the
determination of segment profit excludes restructuring and exit costs. Of the $31.6
million pre-tax restructuring charge recognized in 2003, $21.1 million related to the
businesses in the Power Tools and Accessories segment, and $10.5 million related to the
businesses in the Hardware and Home Improvement segment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A072></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>DISCONTINUED OPERATIONS</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As more fully discussed in Note 3 of
Notes to Consolidated Financial Statements, the European security hardware business,
consisting of the NEMEF, Corbin, and DOM businesses, has been reflected as discontinued
operations in the Consolidated Financial Statements. As such, the operating results,
assets and liabilities, and cash flows of the discontinued European security hardware
business have been reported separately from the Corporation&#146;s continuing operations.
In November 2005, the Corporation completed the sale of the DOM security hardware business
for an aggregate price of $17.2 million net of cash transferred. In January 2004, the
Corporation completed the sale of two European security hardware businesses, NEMEF and
Corbin, for an aggregate price of $77.5 million net of cash transferred. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
(loss) earnings of the discontinued European security hardware business were $(.1) million
($&#151; per share on a diluted basis) for the year ended December 31, 2005; $14.9 million
($.19 per share on a diluted basis) for the year ended December 31, 2004; and $5.8 million
($.07 per share on a diluted basis) for the year ended December 31, 2003. Earnings from
discontinued operations include a pre-tax restructuring reversal of $.6 million for the
year ended December 31, 2003. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A073></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Restructuring Actions</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation is committed to
continuous productivity improvement and continues to evaluate opportunities to reduce
fixed costs, simplify or improve processes, and eliminate excess capacity. A tabular
summary of restructuring activity during the three years ended December 31, 2005, is
included in Note 20 of Notes to Consolidated Financial Statements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, the Corporation recognized $5.4 million of pre-tax restructuring and exit costs
related to actions taken in its Power Tools and Accessories segment. The restructuring
actions taken in 2004 principally reflected severance benefits. The $5.4 million charge
recognized during 2004 was offset, however, by the reversal of $4.0 million of severance
accruals established as part of previously provided restructuring reserves that were no
longer required and $1.4 million representing the excess of proceeds received on the sale
of long-lived assets, written down as part of restructuring actions, over their adjusted
carrying values. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the fourth quarter of 2001, the Corporation formulated a restructuring plan designed to
reduce its manufacturing footprint, variable production costs, and selling, general, and
administrative expenses. The following discussion excludes the restructuring actions
relating to the discontinued European security hardware business. Earnings from
discontinued operations include pre-tax restructuring reversals of $.6 million for the
year ended December 31, 2003. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2003, the Corporation commenced the final phase of its restructuring plan and recorded a
pre-tax restructuring charge associated with that plan of $20.6 million. That $20.6
million charge was net of $9.6 million of reversals of previously provided restructuring
reserves that were no longer required and $3.6 million, representing the excess of
proceeds received on the sale of long-lived assets, written down as part of restructuring
actions, over their adjusted carrying values. In addition, during the fourth quarter of
2003 the Corporation recorded a pre-tax restructuring charge of $11.0 million associated
with the closure of a manufacturing facility in its Hardware and Home Improvement segment
as a result of the acquisition of Baldwin and Weiser. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>21</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
$20.6 million pre-tax restructuring charge recognized in 2003 principally reflected
actions relating to the Power Tools and Accessories segment to reduce its manufacturing
cost base as well as actions to reduce selling, general, and administrative expenses
through the elimination of administrative positions. Actions to reduce the
Corporation&#146;s manufacturing cost base in the Power Tools and Accessories segment
include the closure of one facility in the United States and the transfer of certain
additional power tool production from a facility in the United States to a low-cost
facility in Mexico. The 2003 restructuring charge provided for actions to reduce selling,
general, and administrative expenses, principally in Europe, and to a lesser extent in the
United States, principally reducing headcount. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
indicated in Note 20 of Notes to Consolidated Financial Statements, the severance benefits
accrual, included in the $31.6 million pre-tax restructuring charge taken in 2003, related
to the elimination of approximately 1,700 positions in high-cost manufacturing locations
and in certain administrative positions. The Corporation estimates that, as a result of
increases in manufacturing employee headcount in low-cost locations, approximately 1,300
replacement positions were filled, yielding a net total of 400 positions eliminated as a
result of the 2003 restructuring actions. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2005, the Corporation substantially completed the execution of the restructuring plan that
was formulated in the fourth quarter of 2001 and the closure of the manufacturing facility
in its Hardware and Home Improvement segment as a result of the acquisition of Baldwin and
Weiser. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to the recognition of restructuring and exit costs, the Corporation also
recognized related expenses, incremental to the cost of the underlying restructuring
actions, that do not qualify as restructuring or exit costs under accounting principles
generally accepted in the United States (restructuring-related expenses). Those
restructuring-related expenses included items &#150; directly related to the underlying
restructuring actions &#150; that benefited on-going operations, such as costs associated
with the transfer of equipment. Operating results for the years ended December 31, 2005
and 2004, included approximately $15 million of restructuring-related expenses in both
years. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation realized benefits of approximately $22 million and $70 million in 2005 and
2004, respectively, net of restructuring-related expenses. Those benefits resulted in a
reduction in cost of goods sold of approximately $17 million and $58 million in 2005 and
2004, respectively, and a reduction in selling, general, and administrative expenses of
approximately $5 million and $12 million in 2005 and 2004, respectively. The Corporation expects
that pre-tax savings associated with the restructuring actions related to the integration
of Baldwin and Weiser into its existing security hardware business will benefit 2006
results by approximately $25 million, net of restructuring-related expenses. The
Corporation expects that, of those incremental pre-tax savings in 2006, approximately 85%
will benefit gross margin and 15% will be realized through a reduction of selling,
general, and administrative expenses. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation expects that incremental pre-tax savings associated with the integration of
the Tools Group will benefit results by approximately $20 million in 2006, net of
integration-related expenses. The Corporation expects that, of those incremental pre-tax
savings in 2006, approximately 85% will benefit gross margin and 15% will be realized
through a reduction of selling, general, and administrative expenses. Ultimate savings
realized from restructuring actions may be mitigated by such factors as economic weakness
and competitive pressures, as well as decisions to increase costs in areas such as
promotion or research and development above levels that were otherwise assumed. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>22</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
previously indicated, the pre-tax restructuring charges recognized in 2004 and 2003, of
$&#151; and $31.6 million, respectively, were net of reversals in 2004 and 2003 of
previously provided restructuring reserves that were no longer required and proceeds
received in excess of the adjusted carrying value of long-lived assets in the aggregate of
$5.4 million and $13.2 million, respectively. Adjustments to the severance component of
restructuring reserves previously established related to: (i) actual attrition factors
that differed from those initially estimated; (ii) more cost-effective methods of severing
employment that became probable, typically based on negotiations with trade unions or
local government institutions; and (iii) amendments to the initial plan that were approved
by the appropriate level of management, based primarily on changes in market conditions
that dictated a modification to the intended course of action. During 2004 and 2003, none
of the adjustments to the severance obligations recorded in connection with restructuring
actions was individually significant. Adjustments to the asset write-down component of
restructuring reserves previously established related to the receipt of proceeds in excess
of adjusted carrying values of fixed assets that were disposed of in connection with the
restructuring actions. Adjustments to the other charge component of restructuring reserves
previously established principally related to settlement of operating lease commitments at
amounts less than initially estimated or the Corporation&#146;s ability to sublease
certain facilities exited as part of the restructuring actions. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asset
write-downs taken as part of the 2003 restructuring charge included land, buildings, and
manufacturing equipment. The carrying values of land and buildings to be sold were written
down to their estimated fair values, generally based upon third party offers, less
disposal costs. The carrying values of manufacturing equipment and furniture and fixtures
were written down to their fair value based upon estimated salvage values, which generally
were negligible, less disposal cost. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to the previously discussed restructuring actions, prior to the date of the
acquisition of Baldwin and Weiser and during the fourth quarter of 2003, the Corporation
identified opportunities to restructure these businesses as well as to integrate these
businesses into the existing security hardware business included in the Corporation&#146;s
Hardware and Home Improvement segment. Subsequent to the acquisition, the Corporation
approved restructuring actions relating to the acquired businesses of $3.7 million. These
actions principally reflected severance benefits associated with administrative and
manufacturing actions related to the acquired businesses, including the closure of an
acquired administration and distribution facility. These restructuring actions were
completed in 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Also,
prior to the date of the acquisition of the Porter-Cable and Delta Tools Group and during
the fourth quarter of 2004, the Corporation identified opportunities to restructure these
businesses as well as to integrate these businesses into its existing Power Tools and
Accessories segment. Subsequent to the acquisition, the Corporation approved restructuring
actions relating to the acquired business of $15.2 million. These actions principally
reflected severance costs associated with administrative and manufacturing actions related
to the acquired businesses, including the closure of three manufacturing facilities, and
lease and other contractual obligations for which no future benefit will be realized.
Certain of these restructuring actions commenced in 2004 and the remainder commenced in
2005. The Corporation expects that these restructuring actions will be completed by the
end of 2006. </FONT></P>

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<A NAME=A074></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Hedging Activities </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation has a number of
manufacturing sites throughout the world and sells its products in more than 100
countries. As a result, it is exposed to movements in the exchange rates of various
currencies against the United States dollar and against the currencies of countries in
which it manufactures. The major foreign currencies in which foreign currency risks exist
are the euro, pound sterling, Canadian dollar, Japanese yen, Chinese renminbi, Australian
dollar, Mexican peso, Czech koruna, and Brazilian real. Through its foreign currency
activities, the Corporation seeks to reduce the risk that cash flows resulting from the
sales of products manufactured in a currency different from that of the selling subsidiary
will be affected by changes in exchange rates. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
time to time, currencies may strengthen or weaken in countries in which the Corporation
sells or manufactures its product. While the Corporation will take actions to mitigate the
impacts of any future currency movements, there is no assurance that such movements will
not adversely affect the Corporation. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets
and liabilities of subsidiaries located outside of the United States are translated at
rates of exchange at the balance sheet date as more fully explained in Note 1 of Notes to
Consolidated Financial Statements. The resulting translation adjustments are included in
the accumulated other comprehensive income (loss) component of stockholders&#146; equity.
During 2005, translation adjustments, recorded in the accumulated other comprehensive
income (loss) component of stockholders&#146; equity, decreased stockholders&#146; equity
by $89.1 million, compared to an increase of $95.8 million in 2004. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>23</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
materials used in the manufacturing of the Corporation&#146;s products, which include
certain components and raw materials, are subject to price volatility. These component
parts and raw materials are principally subject to market risk associated with changes in
the price of aluminum, copper, steel, resins, and zinc. The materials used in the various
manufacturing processes are purchased on the open market, and the majority is available
through multiple sources. While future movements in prices of raw materials and component
parts are uncertain, the Corporation uses a variety of methods, including established
supply arrangements, purchase of component parts and raw materials for future delivery,
and supplier price commitments, to address this risk. In addition, the Corporation
utilizes derivatives to manage its risk to changes in the prices of certain commodities.
As of December 31, 2005, no commodity hedges were outstanding. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 10 of Notes to Consolidated Financial Statements, the
Corporation seeks to issue debt opportunistically, whether at fixed or variable rates, at
the lowest possible costs. Based upon its assessment of the future interest rate
environment and its desired variable rate debt to total debt ratio, the Corporation may
elect to manage its interest rate risk associated with changes in the fair value of its
indebtedness, or the cash flows of its indebtedness, through the use of interest rate swap
agreements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to meet its goal of fixing or limiting interest costs, the Corporation maintains a
portfolio of interest rate hedge instruments. The variable rate debt to total debt ratio,
after taking interest rate hedges into account, was 64% at December 31, 2005, compared to
52% at December 31, 2004, and 47% at December 31, 2003. At December 31, 2005, average debt
maturity was 4.9 years compared to 8.3 years at December 31, 2004, and 8.8 years at
December 31, 2003. At December 31, 2005, average long-term debt maturity was 7.3 years
compared to 8.3 years at December 31, 2004, and 8.8 years at December 31, 2003. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A075></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>INTEREST RATE SENSITIVITY</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table provides information as of December 31, 2005, about the Corporation&#146;s
derivative financial instruments and other financial instruments that are sensitive to
changes in interest rates, including interest rate swaps and debt obligations. For debt
obligations, the table presents principal cash flows and related average interest rates by
contractual maturity dates. For interest rate swaps, the table presents notional principal
amounts and weighted-average interest rates by contractual maturity dates. Notional
amounts are used to calculate the contractual payments to be exchanged under the interest
rate swaps. Weighted-average variable rates are generally based on the London Interbank
Offered Rate (LIBOR) as of the reset dates. The cash flows of these instruments are
denominated in a variety of currencies. Unless otherwise indicated, the information is
presented in U.S. dollar equivalents, which is the Corporation&#146;s reporting currency,
as of December 31, 2005. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Principal Payments and
Interest Rate Detail by Contractual Maturity Dates </B></FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=1>(U.S. DOLLARS IN MILLIONS)</FONT></TD>
     <TD COLSPAN="4" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2006
</FONT></TD>
     <TD COLSPAN="1" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2007 </FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2008</FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2009</FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2010</FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>THEREAFTER</FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="2" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>TOTAL</FONT></TD>
     <TD COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>FAIR VALUE<BR>
(ASSETS)/<BR>
LIABILITIES
</FONT></TD></TR>
<TR>
     <TD COLSPAN=27><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="25%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>LIABILITIES</B></FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="7%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="7%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="7%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="7%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="7%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="8%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="8%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="8%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>Short-term borrowings</B><BR>Variable rate (other currencies)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>566.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp; &nbsp;&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        566.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>       566</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;Average interest rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.56</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.56</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>Long-term debt</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Fixed rate (U.S. dollars)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>155.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    150.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   .2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> .1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    850.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,155.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,194</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;Average interest rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.00</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.55</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.00</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.00</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.27</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.41</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>INTEREST RATE DERIVATIVES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Fixed to Variable Rate Interest</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Rate Swaps (U.S. dollars)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    125.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    75.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &nbsp;&nbsp;&nbsp;&nbsp;&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    325.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      525.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     (5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;Average pay rate (a)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;Average receive rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.03</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.22</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.08</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.33</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=27><HR NOSHADE COLOR=Black SIZE=2></TD></TR>
</TABLE>



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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The average pay rate is based upon 6-month forward LIBOR, except for $275.0
                    million in notional principal amount which matures in 2007 and thereafter and is
                    based upon 3-month forward LIBOR. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>
<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>24</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A077></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>FOREIGN CURRENCY EXCHANGE
RATE SENSITIVITY</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As discussed above, the Corporation
is exposed to market risks arising from changes in foreign exchange rates. As of December
31, 2005, the Corporation has hedged a portion of its 2006 estimated foreign currency
transactions using forward exchange contracts. The Corporation estimated the effect on
2006 gross profits, based upon a recent estimate of foreign exchange exposures, of a
uniform 10% strengthening in the value of the United States dollar. The Corporation
estimated that this would have the effects of reducing gross profits for 2006 by
approximately $15 million. The Corporation also estimated the effects on 2006 gross
profits, based upon a recent estimate of foreign exchange exposures, of a uniform 10%
weakening in the value of the United States dollar. A uniform 10% weakening in the value
of the United States dollar would have the effect of increasing gross profits. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to their direct effects, changes in exchange rates also affect sales volumes and
foreign currency sales prices as competitors&#146; products become more or less
attractive. The sensitivity analysis of the effects of changes in foreign currency
exchange rates previously described does not reflect a potential change in sales levels or
local currency prices nor does it reflect higher exchange rates, compared to those
experienced during 2005, inherent in the foreign exchange hedging portfolio at December
31, 2005. </FONT></P>

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<A NAME=A078></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Critical Accounting
Policies</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s accounting
policies are more fully described in Note 1 of Notes to Consolidated Financial Statements.
As disclosed in Note 1 of Notes to Consolidated Financial Statements, the preparation of
financial statements in conformity with accounting principles generally accepted in the
United States requires management to make estimates and assumptions about future events
that affect the amounts reported in the financial statements and accompanying notes.
Future events and their effects cannot be determined with absolute certainty. Therefore,
the determination of estimates requires the exercise of judgment. Actual results
inevitably will differ from those estimates, and such differences may be material to the
financial statements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation believes that, of its significant accounting policies, the following may
involve a higher degree of judgment, estimation, or complexity than other accounting
policies. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 1 of Notes to Consolidated Financial Statements, the
Corporation performs goodwill impairment tests on at least an annual basis and more
frequently in certain circumstances. The Corporation cannot predict the occurrence of
certain events that might adversely affect the reported value of goodwill that totaled
$1,115.7 million at December 31, 2005. Such events may include, but are not limited to,
strategic decisions made in response to economic and competitive conditions, the impact of
the economic environment on the Corporation&#146;s customer base, or a material negative
change in its relationships with significant customers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pension
and other postretirement benefits costs and obligations are dependent on assumptions used
in calculating such amounts. These assumptions include discount rates, expected return on
plan assets, rates of salary increase, health care cost trend rates, mortality rates, and
other factors. These assumptions are updated on an annual basis prior to the beginning of
each year. The Corporation considers current market conditions, including interest rates,
in making these assumptions. The Corporation develops the discount rates by considering
the yields available on high-quality fixed income investments with maturities
corresponding to the related benefit obligation. The Corporation&#146;s discount rate for
United States defined benefit pension plans was 5.75% and 6.00% at December 31, 2005 and
2004, respectively. As discussed further in Note 13 of Notes to Consolidated Financial
Statements, the Corporation develops the expected return on plan assets by considering
various factors, which include its targeted asset allocation percentages, historic
returns, and expected future returns. The Corporation&#146;s expected long-term rate of
return assumption for United States defined benefit plans for 2005 and 2006 is 8.75%. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation believes that the assumptions used are appropriate; however, differences in
actual experience or changes in the assumptions may materially affect the
Corporation&#146;s financial position or results of operations. In accordance with
accounting principles generally accepted in the United States, actual results that differ
from the actuarial assumptions are accumulated and, if in excess of a specified corridor,
amortized over future periods and, therefore, generally affect recognized expense and the
recorded obligation in future periods. The expected return on plan assets is determined
using the expected rate of return and a calculated value of assets referred to as the
market-related value of assets. The Corporation&#146;s aggregate fair value of plan assets
exceeded the market-related value of assets by approximately $14.7 million as of the 2005
measurement date. Differences between assumed and actual returns are amortized to the
market-related value on a straight-line basis over a five-year period. Also, gains and
losses resulting from changes in assumptions and from differences between assumptions and
actual experience (except those differences being amortized to the market-related value of
assets) are amortized over the expected remaining service period of active plan
participants or, for retired participants, the average remaining life expectancy, to the
extent that such amounts exceed ten percent of</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>25</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>the greater of the market-related value of
plan assets or the projected benefit obligation at the beginning of the year. The
Corporation expects that its pension and other postretirement benefit costs in 2006 will
exceed the costs recognized in 2005 by approximately $12.0 million. This increase is
principally attributable to two factors: the effect of amortization of certain actuarial
losses and a reduction in the market-related value of pension plan assets as compared to
the prior year. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Item 3 of this report, the Corporation is subject to various legal
proceedings and claims, including those with respect to environmental matters, the
outcomes of which are subject to significant uncertainty. The Corporation evaluates, among
other factors, the degree of probability of an unfavorable outcome, the ability to make a
reasonable estimate of the amount of loss, and in certain instances, the ability of other
parties to share costs. Also, in accordance with accounting principles generally accepted
in the United States when a range of probable loss exists, the Corporation accrues at the
low end of the range when no other more likely amount exists. Unanticipated events or
changes in these factors may require the Corporation to increase the amount it has accrued
for any matter or accrue for a matter that has not been previously accrued because it was
not probable. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Further,
as indicated in Note 21 of Notes to Consolidated Financial Statements, insurance
recoveries for environmental and certain general liability claims have not been recognized
until realized. Any insurance recoveries, if realized in future periods, could have a
favorable impact on the Corporation&#146;s financial condition or results of operations in
the periods realized. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is also subject to income tax laws in many countries. Judgment is required in
assessing the future tax consequences of events that have been recognized in the
Corporation&#146;s financial statements or tax returns. Additionally, the Corporation is
subject to periodic examinations by taxing authorities in many countries. The final
outcome of these future tax consequences, tax audits, and changes in regulatory tax laws
and rates could materially impact the Corporation&#146;s financial statements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2003, the Corporation received notices of proposed adjustments from the United States
Internal Revenue Service (IRS) in connection with audits of the tax years 1998 through
2000. The principal adjustment proposed by the IRS consists of the disallowance of a
capital loss deduction taken in the Corporation&#146;s tax returns and interest on the
deficiency. Prior to receiving the notices of proposed adjustments from the IRS, the
Corporation filed a petition against the IRS in the Federal District Court of Maryland
(the Court) seeking refunds for a carryback of a portion of the aforementioned capital
loss deduction. The IRS subsequently filed a counterclaim to the Corporation&#146;s
petition. In October 2004, the Court granted the Corporation&#146;s motion for summary
judgment on its complaint against the IRS and dismissed the IRS counter-claim. In its
opinion, the Court ruled in the Corporation&#146;s favor that the capital losses cannot be
disallowed by the IRS. In December 2004, the IRS appealed the Court&#146;s decision in
favor of the Corporation to the United States Circuit Court of Appeals for the Fourth
Circuit (the Fourth Circuit). In February 2006, the Fourth Circuit issued its decision,
deciding two of three issues in the Corporation&#146;s favor and remanding the third issue
for trial in the Court. The Corporation intends to vigorously dispute the position taken
by the IRS in this matter. The Corporation has provided adequate reserves in the event
that the IRS prevails in its disallowance of the previously described capital loss and the
imposition of related interest. Should the IRS prevail in its disallowance of the capital
loss deduction and the imposition of related interest, it would result in a cash outflow
of approximately $160 million. If the Corporation prevails, it would result in the
Corporation receiving a refund of taxes previously paid of approximately $50 million, plus
interest. The Corporation believes that any such outflow or inflow is unlikely to occur
until 2007 or later. </FONT></P>

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<A NAME=A079></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Impact of New Accounting
Standards </B></FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As more fully  described in Note 1 of Notes to Consolidated  Financial  Statements,  the Corporation has not yet adopted  Statement of
Financial Accounting Standards (SFAS) No. 123 (revised 2004), <I>Share-Based Payments</I>, or SFAS No. 151, <I>Inventory Costs</I>.</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>26</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A080></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Financial Condition</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Operating activities generated cash
of $628.0 million for the year ended December 31, 2005, compared to $619.1 million of cash
generated for the year ended December 31, 2004. Cash flow from operating activities
included cash flow from discontinued operations of $4.7 million and $3.1 million for the
years ended December 31, 2005 and 2004, respectively. The increase in cash provided by
operating activities in 2005 over 2004 was primarily the result of increased earnings from
continuing operations, including the effect of the $55.0 million settlement of
environmental and product liability coverage litigation with an insurer, which was
partially offset by increased cash usage associated with working capital and income taxes.
The Corporation will be required to make income tax payments &#150; associated with the
repatriation of previously unremitted foreign earnings under the American Jobs Creation
Act of 2004 &#150; in the first quarter of 2006. Increases in inventories and receivables
(associated with the higher level of sales and to achieve higher service levels) exceeded
the increase in accrued liabilities (associated with higher sales and earnings levels) in
2005 as compared to 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
part of its capital management, the Corporation reviews certain working capital metrics.
For example, the Corporation evaluates its accounts receivable and inventory levels
through the computation of days sales outstanding and inventory turnover ratio,
respectively. The number of days sales outstanding as of December 31, 2005, increased
slightly from the number of days sales outstanding as of December 31, 2004. Average
inventory turns as of December 31, 2005, approximated average inventory turns as of
December 31, 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investing
activities for the year ended December 31, 2005 used cash of $34.6 million compared to
$819.6 million of cash used in 2004. This decrease in cash used was primarily the result
of acquisition and divestiture activity. In 2005, cash proceeds from divesture and
acquisition activity totaled $61.2 million, including $33.6 million associated with the
sale of Flex, $17.2 million associated with the sale of discontinued operations, and $10.4
million of cash received during 2005 associated with the preliminary adjustment to the
purchase price of the Porter-Cable and Delta Tools Group. In 2004, cash used for
acquisition and divestiture activity totaled $727.1 million, including $792.0 million, net
of cash acquired, for the acquisition of the Porter-Cable and Delta Tools Group and $12.6
million of cash used for other acquisitions &#150; including the purchase of MasterFix,
which was partially offset by $77.5 million of net proceeds from the sale of two of the
discontinued European security hardware businesses. Capital expenditures were $111.1
million and $117.8 million in 2005 and 2004, respectively. The Corporation anticipates
that its capital spending in 2006 will approximate $120 million. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financing
activities used cash of $129.2 million in 2005, compared to cash provided of $391.9
million in 2004. The increased use of cash for financing activities primarily resulted
from the purchase by the Corporation of 6,276,700 shares of its common stock at an
aggregate cost of $525.7 million, the repayment of $136.0 million of preferred stock of a
subsidiary, and the increase of the Corporation&#146;s dividend payments, which increased
&#150; on a per share basis &#150; from $.84 during 2004 to $1.12 during 2005. Dividend
payments were $88.6 million and $67.5 million in 2005 and 2004, respectively. The
increased use of cash for financing activities during 2005 was offset by the increase in
short-term borrowings of $565.6 million associated with the repatriation of foreign
earnings under the American Jobs Creation Act of 2004 and $56.0 million of proceeds
received upon the issuance of common stock under employee benefit plans. Cash provided by
financing activities in 2004 included $295.4 million of proceeds, net of discounts and
debt issuance costs, received in October 2004 upon the issuance of $300 million of 4.75%
Senior Notes due in 2014. Cash provided by financing activities in 2004 also included
$171.6 million of proceeds received upon the issuance of common stock under employee
benefit plans. During the year ended December 31, 2004, the Corporation repurchased 66,100
shares of its common stock at an aggregate cost of $3.6 million. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation implemented its share repurchase program based upon the belief that its shares
were undervalued and to manage share growth resulting from option exercises. At December
31, 2005, the Corporation had remaining authorization from its Board of Directors to
repurchase an additional 4,068,795 shares of its common stock. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subsequent
to December 31, 2005, the Corporation repurchased 1,012,700 shares of its common stock at
an aggregate cost of $84.3 million. After those share repurchases, the Corporation has
remaining authorization from its Board of Directors to repurchase an additional 3,056,095
shares of its common stock. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
February 9, 2006, the Corporation announced that its Board of Directors declared a
quarterly cash dividend of $.38 per share of the Corporation&#146;s outstanding common
stock payable during the first quarter of 2006. The $.38 dividend represents a 36%
increase over the $.28 quarterly dividend paid by the Corporation since the first quarter
of 2005. Future dividends will depend on the Corporation&#146;s earnings, financial
condition, and other factors. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>27</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
discussed further in Note 13 of Notes to Consolidated Financial Statements, in accordance
with SFAS No. 87,<I> Employer&#146;s Accounting for Pensions</I>, the Corporation has
recorded a minimum pension liability adjustment at December 31, 2005 as a charge to
stockholders&#146; equity of $337.6 million, net of tax. That charge to stockholders&#146;
equity did not impact the Corporation&#146;s compliance with covenants under its borrowing
agreements or cash flow. The Corporation&#146;s expense recognized relating to its pension
and other postretirement benefit plans increased by approximately $19 million in 2005
over the 2004 levels. The Corporation anticipates that the expense recognized relating to
its pension and other postretirement benefit plans in 2006 will increase by approximately
$12 million over the 2005 levels. That increase is partially attributable to the
amortization of previously unrecognized actuarial losses that gave rise to the minimum
liability adjustment. As discussed further in Note 13 of Notes to Consolidated Financial
Statements, the Corporation does not anticipate that the funding requirements relating to
the pension benefit plans in 2006 will be material. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2003, the Corporation received notices of proposed adjustments from the United States
Internal Revenue Service (IRS) in connection with audits of the tax years 1998 through
2000. The principal adjustment proposed by the IRS consists of the disallowance of a
capital loss deduction taken in the Corporation&#146;s tax returns and interest on the
deficiency. Prior to receiving the notices of proposed adjustments from the IRS, the
Corporation filed a petition against the IRS in the Federal District Court of Maryland
(the Court) seeking refunds for a carryback of a portion of the aforementioned capital
loss deduction. The IRS subsequently filed a counterclaim to the Corporation&#146;s
petition. In October 2004, the Court granted the Corporation&#146;s motion for summary
judgment on its complaint against the IRS and dismissed the IRS counter-claim. In its
opinion, the Court ruled in the Corporation&#146;s favor that the capital losses cannot be
disallowed by the IRS. In December 2004, the IRS appealed the Court&#146;s decision in
favor of the Corporation to the United States Circuit Court of Appeals for the Fourth
Circuit (the Fourth Circuit Court). In February 2006, the Fourth Circuit Court issued its
decision, deciding two of three issues in the Corporation&#146;s favor and remanding the
third issue for trial in the Court. The Corporation intends to vigorously dispute the
position taken by the IRS in this matter. The Corporation has provided adequate reserves
in the event that the IRS prevails in its disallowance of the previously described capital
loss and the imposition of related interest. Should the IRS prevail in its disallowance of
the capital loss deduction and the imposition of related interest, it would result in a
cash outflow by the Corporation of approximately $160 million. If the Corporation
prevails, it would result in the Corporation receiving a refund of taxes previously paid
of approximately $50 million, plus interest. The Corporation believes that any such
outflow or inflow is unlikely to occur until 2007 or later. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
ongoing costs of compliance with existing environmental laws and regulations have not had,
and are not expected to have, a material adverse effect on the Corporation&#146;s capital
expenditures or financial position. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation will continue to have cash requirements to support seasonal working capital
needs and capital expenditures, to pay interest, to service debt, and to complete the
restructuring and integration actions previously described. As more fully described in
Note 12 of Notes to Consolidated Financial Statements, during 2005 the Corporation
repatriated $888.3 million of previously unremitted foreign earnings under the American
Jobs Creation Act of 2004. That repatriation resulted in an increase in the
Corporation&#146;s short-term borrowing levels and a corresponding increase in cash and
cash equivalents. For amounts available at December 31, 2005, under the Corporation&#146;s
revolving credit facilities and under short-term borrowing facilities, see Note 8 of Notes
to Consolidated Financial Statements. In order to meet its cash requirements, the
Corporation intends to use its existing cash, cash equivalents, and internally generated
funds, and to borrow under its existing and future unsecured revolving credit facilities
or under short-term borrowing facilities. The Corporation believes that cash provided from
these sources will be adequate to meet its cash requirements over the next 12 months. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table provides a summary of the Corporation&#146;s contractual obligations by
due date (in millions of dollars). The Corporation&#146;s short-term borrowings, long-term
debt, and lease commitments are more fully described in Notes 8, 9, and 19, respectively,
of Notes to Consolidated Financial Statements. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>28</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=15><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>PAYMENTS DUE BY PERIOD</B></FONT><HR NOSHADE COLOR=#000000 SIZE=2></TH></TR>

<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LESS THAN 1 YEAR</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1 TO 3 YEARS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3 TO 5 YEARS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AFTER 5 YEARS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TOTAL</FONT></TD></TR>
<TR>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=33% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Short-term borrowings (a) (b)</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     566</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD WIDTH=11% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  </FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  </FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD WIDTH=5% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     566</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>155</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>150</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>850</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,155</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Operating leases</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>63</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>92</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>216</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase obligations (c)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>445</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>454</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total contractual cash obligations (d)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,230</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   249</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   42</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   870</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,392</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    As more fully described in Note 8 of Notes to Consolidated Financial Statements,
                    the Corporation has a $1.0 billion credit facility that matures in October 2009
                    and a $1.0 billion commercial paper program. There was $467.2 million
                    outstanding under the commercial paper program at December 31, 2005. The
                    Corporation&#146;s average borrowing outstanding under these facilities during
                    2005 was $213.8 million. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    As described in Note 8 of Notes to Consolidated Financial Statements, certain
                    subsidiaries of the Corporation outside of the United States have uncommitted
                    lines of credit of $399.0 million at December 31, 2005. These uncommitted lines
                    of credit do not have termination dates and are reviewed periodically. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Corporation enters into contractual arrangements that result in its
                    obligation to make future payments, including purchase obligations. The
                    Corporation enters into these arrangements in the ordinary course of business in
                    order to ensure adequate levels of inventories, machinery and equipment, or
                    services. Purchase obligations primarily consist of inventory purchase
                    commitments, including raw materials, components, and sourced products,
                    sponsorship arrangements, and arrangements for other services. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Corporation anticipates that funding of its pension and postretirement
                    benefit plans in 2006 will approximate $31 million. That amount principally
                    represents contributions either required by regulations or laws or, with respect
                    to unfunded plans, necessary to fund current benefits. The Corporation has not
                    presented estimated pension and postretirement funding in the table above as the
                    funding can vary from year to year based upon changes in the fair value of the
                    plan assets and actuarial assumptions. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</B>
</FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
is contained in Item 7 of this report under the caption &#147;Hedging Activities&#148; and
in Item 8 of this report in Notes 1 and 10 of Notes to Consolidated Financial Statements,
and is incorporated herein by reference. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The following consolidated financial
statements of the Corporation and its subsidiaries are included herein as indicated below: </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Consolidated Financial
Statements</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consolidated Statement of Earnings &#150;
years ended December 31, 2005, 2004, and 2003. </FONT></P>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consolidated </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Balance Sheet &#150; December 31, 2005 and 2004. </FONT></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consolidated </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> Statement
of Stockholders&#146; Equity &#150; years ended December 31, 2005, 2004, and 2003. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consolidated </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Statement of Cash Flows &#150; years ended December 31, 2005, 2004, and 2003. </FONT></TD>
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<BR>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Notes to Consolidated
Financial Statements. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Report of Independent Registered
Public Accounting Firm on Consolidated Financial Statements. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>29</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CONSOLIDATED STATEMENT
OF EARNINGS<BR>THE BLACK &amp; DECKER CORPORATION AND SUBSIDIARIES</B><BR> (DOLLARS IN MILLIONS
EXCEPT PER SHARE DATA)</FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=61% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31,</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TD>
        <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>SALES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>6,523.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    5,398.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    4,482.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Cost of goods sold</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4,206.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,432.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,887.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Selling, general, and administrative expenses</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,504.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,336.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,135.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Restructuring and exit costs</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>31.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OPERATING INCOME</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>813.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>629.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>428.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Interest expense (net of interest income of</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$36.5 for 2005, $35.8 for 2004, and $25.5 for 2003)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>45.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>22.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other (income) expense</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(51.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EARNINGS FROM CONTINUING OPERATIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>BEFORE INCOME TAXES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>819.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>604.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>390.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Income taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>275.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>163.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>103.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NET EARNINGS FROM CONTINUING OPERATIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>544.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>441.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>287.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>DISCONTINUED OPERATIONS (NET OF INCOME TAXES):</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Earnings of discontinued operations (net of income taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;of $.5 for 2005, $1.0 for 2004, and $3.5 for 2003)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(Loss) gain on sale of discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(net of impairment charge of $24.4 in 2004)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NET (LOSS) EARNINGS FROM DISCONTINUED OPERATIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NET EARNINGS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>543.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      456.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      293.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3>&nbsp;</TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3>&nbsp;</TD></TR>



<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>BASIC EARNINGS PER COMMON SHARE</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        <B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NET EARNINGS PER COMMON SHARE&#150; BASIC</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        <B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        5.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>DILUTED EARNINGS PER COMMON SHARE</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        <B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NET EARNINGS PER COMMON SHARE&#150;</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>ASSUMING DILUTION</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        <B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>

</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See Notes to Consolidated
Financial Statements. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>30</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->

<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CONSOLIDATED BALANCE
SHEET<BR>THE BLACK &amp; DECKER CORPORATION AND SUBSIDIARIES</B><BR> (MILLIONS OF DOLLARS)</FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=75% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DECEMBER 31,</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TD>
        <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ASSETS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash and cash equivalents</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>967</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     514</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trade receivables, less allowances of $45.1 for 2005 and $52.1 for 2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,130</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,046</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Inventories</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,049</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>981</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Current assets of discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>70</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other current assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>200</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>313</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>TOTAL CURRENT ASSETS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3,347</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,927</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>PROPERTY, PLANT, AND EQUIPMENT</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>668</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>754</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>GOODWILL</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,115</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,184</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OTHER ASSETS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>684</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>665</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>5,816</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,530</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>LIABILITIES AND STOCKHOLDERS' EQUITY</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Short-term borrowings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>566</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>       1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Current maturities of long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>155</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trade accounts payable</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>466</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>466</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Current liabilities of discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>29</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other current liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,075</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,294</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>TOTAL CURRENT LIABILITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2,264</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,792</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>LONG-TERM DEBT</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,030</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,200</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>DEFERRED INCOME TAXES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>188</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>171</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>POSTRETIREMENT BENEFITS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>419</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>423</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OTHER LONG-TERM LIABILITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>391</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>384</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>STOCKHOLDERS' EQUITY</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Common stock (outstanding: December 31, 2005&#150; 77,357,370 shares;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;December 31, 2004&#150; 82,095,161 shares)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>38</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>41</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Capital in excess of par value</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>273</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>699</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unearned restricted stock compensation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(20</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(12</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Retained earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,616</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,161</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accumulated other comprehensive income (loss)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(385</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(330</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>TOTAL STOCKHOLDERS' EQUITY</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,523</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,558</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>5,816</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,530</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See Notes to Consolidated
Financial Statements. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>31</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->

<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CONSOLIDATED STATEMENT
OF STOCKHOLDERS&#146; EQUITY<BR>THE BLACK &amp; DECKER CORPORATION AND SUBSIDIARIES</B><BR>(DOLLARS IN MILLIONS
EXCEPT PER SHARE DATA) </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=1></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>OUTSTANDING<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;COMMON<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SHARES
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;PAR<BR>
&nbsp;VALUE
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>CAPITAL IN<BR>
&nbsp;EXCESS OF<BR>
&nbsp;PAR VALUE
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;&nbsp;UNEARNED <BR>
&nbsp;&nbsp;RESTRICTED <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;STOCK <BR>
COMPENSATION
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;RETAINED<BR>
&nbsp;EARNINGS
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;ACCUMULATED<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OTHER<BR>
&nbsp;COMPREHENSIVE<BR>
&nbsp;INCOME (LOSS)
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL<BR>
STOCKHOLDERS&#146;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EQUITY
</FONT></TH></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>BALANCE AT DECEMBER 31, 2002</B></FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=5% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>79,604,786</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   39</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD WIDTH=13% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   550</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD WIDTH=5% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD WIDTH=2% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     524</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD WIDTH=2% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (514</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD WIDTH=2% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     599</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income (loss):</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>293</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>293</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net loss on derivative instruments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Minimum pension liability</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;adjustment (net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;Foreign currency translation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;adjustments, less effect</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;of hedging activities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>98</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>98</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>293</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>62</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>355</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash dividends on common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; ($.57 per share)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase and retirement</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;of common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2,011,570</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(76</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(77</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Common stock issued under</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;employee benefit plans</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>340,248</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>BALANCE AT DECEMBER 31, 2003</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77,933,464</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>39</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>486</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>773</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(452</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>846</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income (loss):</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>456</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>456</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net gain on derivative instruments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Minimum pension liability</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustment (net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Foreign currency translation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustments, less effect </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;of hedging activities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>95</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>95</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Write-off of accumulated foreign</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;currency translation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustments due to </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;sale of businesses</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>456</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>121</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>577</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash dividends on common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;($.84 per share)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(67</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(67</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restricted stock grants</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>278,296</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restricted stock amortization,</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;net of forfeitures</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(7,950</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase and retirement </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;of common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(66,100</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Common stock issued under </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;employee benefit plans</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,957,451</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>201</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>203</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>BALANCE AT DECEMBER 31, 2004</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>82,095,161</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>41</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>699</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(12</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,161</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(330</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,558</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income (loss):</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>543</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>543</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Net gain on derivative instruments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>34</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>34</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Minimum pension liability</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustment (net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Foreign currency translation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustments, less effect </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;of hedging activities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;(net of tax)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(89</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(89</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;Write-off of accumulated foreign</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;currency translation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;adjustments due to </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;sale of businesses</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(16</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(16</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Comprehensive income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>543</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(54</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>489</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash dividends on common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;($1.12 per share)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(88</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(88</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restricted stock grants</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>199,630</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(16</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restricted stock amortization,</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;net of forfeitures</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(32,280</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase and retirement</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;of common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(6,276,700</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(522</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(525</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Common stock issued under </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;employee benefit plans</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,371,559</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>82</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>83</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>BALANCE AT DECEMBER 31, 2005</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77,357,370</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   38</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   273</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,616</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (385</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,523</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See Notes to Consolidated
Financial Statements. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>32 &amp; 33</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CONSOLIDATED STATEMENT OF CASH FLOWS<BR>
THE BLACK &amp; DECKER CORPORATION AND SUBSIDIARIES</B><BR> (MILLIONS OF DOLLARS)</FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=72% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31,</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=6% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=6% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=6% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>OPERATING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B> 543</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    456</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    293</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Adjustments to reconcile net earnings to cash flow</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;from operating activities of continuing operations:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Earnings of discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Loss (gain) on sale of discontinued operations (net of impairment charge)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(12</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Non-cash charges and credits:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>150</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>142</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>133</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring and exit costs</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>31</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Changes in selected working capital items</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(net of effects of businesses acquired or divested):</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade receivables</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(128</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(105</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(66</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>94</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade accounts payable</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>12</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(39</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>81</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>102</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Restructuring spending</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(13</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(25</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other assets and liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>82</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CASH FLOW FROM OPERATING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>OF CONTINUING OPERATIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>623</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>616</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>561</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=24>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CASH FLOW FROM OPERATING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>OF DISCONTINUED OPERATIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CASH FLOW FROM OPERATING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>628</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>619</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>570</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>INVESTING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Capital expenditures</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(111</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(117</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(102</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds from disposal of assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>12</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>26</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase of business, net of cash acquired</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>10</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(804</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(277</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds from sale of business, net of cash transferred</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>33</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds from sale of discontinued operations, net of cash transferred</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>17</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Investing activities of discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash inflow from hedging activities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>15</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash outflow from hedging activities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(13</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other investing activities, net</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CASH FLOW FROM INVESTING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(34</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(819</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(368</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>FINANCING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net increase (decrease) in short-term borrowings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>565</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Repayment of preferred stock of subsidiary</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(136</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds from long-term debt (net of debt issue cost of $2.4)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>295</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Payments on long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(310</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Purchase of common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(525</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(77</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Issuance of common stock</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>56</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>171</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash dividends</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(88</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(67</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CASH FLOW FROM FINANCING ACTIVITIES</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(129</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>391</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(425</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effect of exchange rate changes on cash</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(11</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>453</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>206</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(208</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash and cash equivalents at beginning of year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>514</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>308</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>517</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>

<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CASH AND CASH EQUIVALENTS AT END OF YEAR</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>967</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    514</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    308</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>

</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See Notes to Consolidated Financial
Statements. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>34</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A100></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=3><B>NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A101></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
CORPORATION AND SUBSIDIARIES</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A102></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 1: SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Principles of Consolidation:</B>
</I>The Consolidated Financial Statements include the accounts of the Corporation and its
subsidiaries. Intercompany transactions have been eliminated.</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Reclassifications:</B></I> Certain
prior years&#146; amounts in the Consolidated Financial Statements have been reclassified
to conform to the presentation used in 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Use of Estimates: </B></I>The
preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes. Actual
results inevitably will differ from those estimates, and such differences may be material
to the financial statements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Revenue Recognitinon:</B></I> Revenue
from sales of products is recognized when title passes, which occurs either upon shipment
or upon delivery based upon contractual terms. The Corporation recognizes customer program
costs, including customer incentives such as volume or trade discounts, cooperative
advertising and other sales related discounts, as a reduction to sales.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Foreign
Currency Translation: </B></I>The financial statements of subsidiaries located outside of the
United States, except those subsidiaries operating in highly inflationary economies,
generally are measured using the local currency as the functional currency. Assets,
including goodwill, and liabilities of these subsidiaries are translated at the rates of
exchange at the balance sheet date. The resultant translation adjustments are included in
accumulated other comprehensive income (loss), a separate component of stockholders&#146;
equity. Income and expense items are translated at average monthly rates of exchange.
Gains and losses from foreign currency transactions of these subsidiaries are included in
net earnings. For subsidiaries operating in highly inflationary economies, gains and
losses from balance sheet translation adjustments are included in net earnings.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Cash
and Cash Equivalents: </B></I>Cash and cash equivalents include cash on hand, demand deposits,
and short-term investments with maturities of three months or less from the date of
acquisition. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Concentration of Credit: </B></I>The
Corporation sells products and services to customers in diversified industries and
geographic regions and, therefore, has no significant concentrations of credit risk other
than with two major customers. As of December 31, 2005, approximately 30% of the
Corporation&#146;s trade receivables were due from two large home improvement retailers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation continuously evaluates the credit-worthiness of its customers and generally
does not require collateral.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Inventories: </B></I>Inventories are stated at the lower of
cost or market. The cost of United States inventories is based primarily on the last-in,
first-out (LIFO) method; all other inventories are based on the first-in, first-out (FIFO)
method. </FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Property and Depreciation:</B></I> Property, plant, and equipment is stated at
cost. Depreciation is computed generally on the straight-line method for financial
reporting purposes. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Goodwill and Other Intangible
Assets: </B></I>Goodwill represents the excess of the cost of an acquired entity over the net
of the amounts assigned to assets acquired and liabilities assumed. The Corporation
accounts for goodwill in accordance with Statement of Financial Accounting Standards
(SFAS) No. 142, <I>Goodwill and Other Intangible Assets</I>. Under SFAS No. 142, goodwill
and intangible assets deemed to have indefinite lives are not amortized, but are subject
to an annual impairment test, or whenever events or changes in circumstances indicate that
the carrying value may not be recoverable. Other intangible assets continue to be
amortized over their estimated useful lives. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation assesses the fair value of its reporting units for its goodwill impairment
tests based upon a discounted cash flow methodology. Those estimated future cash flows
&#150; which are based upon historical results and current projections &#150; are
discounted at a rate corresponding to a &#147;market&#148; rate. If the carrying amount of
the reporting unit exceeds the estimated fair value determined through that discounted
cash flow methodology, goodwill impairment may be present. The Corporation would measure
the goodwill impairment loss based upon the fair value of the underlying assets and
liabilities of the reporting unit, including any unrecognized intangible assets, and
estimate the implied fair value of goodwill. An impairment loss would be recognized to the
extent that a reporting unit&#146;s recorded goodwill exceeded the implied fair value of
goodwill. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation performed its annual impairment test in the fourth quarters of 2005, 2004, and
2003. No impairment was present upon performing these impairment tests. The Corporation
cannot predict the occurrence of certain events that might adversely affect the reported
value of goodwill. Such events may include, but are not limited to, strategic decisions
made in response to economic and competitive conditions, the impact of the economic
environment on the Corporation&#146;s customer base, or a material negative change in its
relationships with significant customers. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>35</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Product Development Costs:</B>
</I>Costs associated with the development of new products and changes to existing products
are charged to operations as incurred. Product development costs were $133.8 million in
2005, $118.6 million in 2004, and $100.4 million in 2003.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Shipping and Handling Costs:</B>
</I>Shipping and handling costs represent costs associated with shipping products to
customers and handling finished goods. Included in selling, general, and administrative
expenses are shipping and handling costs of $339.2 million in 2005, $278.1 million in
2004, and $229.4 million in 2003. Freight charged to customers is recorded as revenue.
</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<I><B>Advertising and Promotion:</B></I> Advertising and promotion expense, which is expensed as
incurred, was $193.6 million in 2005, $174.9 million in 2004, and $154.0 million in 2003. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Product Warranties:</B></I> Most of
the Corporation&#146;s products in the Power Tools and Accessories segment and Hardware
and Home Improvement segment carry a product warranty. That product warranty, in the
United States, generally provides that customers can return a defective product during the
specified warranty period following purchase in exchange for a replacement product or
repair at no cost to the consumer. Product warranty arrangements outside the United States
vary depending upon local market conditions and laws and regulations. The Corporation
accrues an estimate of its exposure to warranty claims based upon both current and
historical product sales data and warranty costs incurred. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Postretirement Benefits:</B>
</I>Pension plans, which cover substantially all of the Corporation&#146;s employees in
North America, Europe, and the United Kingdom, consist primarily of non-contributory
defined benefit plans. The defined benefit plans are funded in conformity with the funding
requirements of applicable government regulations. Generally, benefits are based on age,
years of service, and the level of compensation during the final years of employment.
Prior service costs for defined benefit plans generally are amortized over the estimated
remaining service periods of employees. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain
employees are covered by defined contribution plans. The Corporation&#146;s contributions
to these plans are based on a percentage of employee compensation or employee
contributions. These plans are funded on a current basis. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to pension benefits, certain postretirement medical, dental, and life insurance
benefits are provided, principally to most United States employees. Retirees in other
countries generally are covered by government-sponsored programs. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation uses the corridor approach in the valuation of defined benefit plans and other
postretirement benefits. The corridor approach defers all actuarial gains and losses
resulting from variances between actual results and economic estimates or actuarial
assumptions. For defined benefit pension plans, these unrecognized gains and losses are
amortized when the net gains and losses exceed 10% of the greater of the market-related
value of plan assets or the projected benefit obligation at the beginning of the year. For
other postretirement benefits, amortization occurs when the net gains and losses exceed
10% of the accumulated postretirement benefit obligation at the beginning of the year. The
amount in excess of the corridor is amortized over the average remaining service period to
retirement date of active plan participants or, for retired participants, the average
remaining life expectancy. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Derivative Financial Instruments:</B>
</I>The Corporation is exposed to market risks arising from changes in interest rates.
With products and services marketed in over 100 countries and with manufacturing sites in
11 countries, the Corporation also is exposed to risks arising from changes in foreign
currency rates. The Corporation uses derivatives principally in the management of interest
rate and foreign currency exposure. It does not utilize derivatives that contain leverage
features. On the date on which the Corporation enters into a derivative, the derivative is
designated as a hedge of the identified exposure. The Corporation formally documents all
relationships between hedging instruments and hedged items, as well as its risk-management
objective and strategy for undertaking various hedge transactions. In this documentation,
the Corporation specifically identifies the asset, liability, firm commitment, forecasted
transaction, or net investment that has been designated as the hedged item and states how
the hedging instrument is expected to reduce the risks related to the hedged item. The
Corporation measures effectiveness of its hedging relationships both at hedge inception
and on an on-going basis. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
each derivative instrument that is designated and qualifies as a fair value hedge, the
gain or loss on the derivative instrument as well as the offsetting loss or gain on the
hedged item attributable to the hedged risk are recognized in current earnings during the
period of the change in fair values. For each derivative instrument that is designated and
qualifies as a cash flow hedge, the effective portion of the gain or loss on the
derivative instrument is reported as a component of accumulated other comprehensive income
(loss) and reclassified into earnings in the same period or periods during which the
hedged transaction affects earnings. The remaining gain or loss on the derivative
instrument in excess of the cumulative change in the present value of future cash flows of
the hedged item, if any, is recognized in current earnings during the period of change.
For hedged forecasted transactions, hedge accounting is discontinued if the forecasted
transaction is no longer probable of occurring, in which case</FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>36</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>previously deferred hedging
gains or losses would be recorded to earnings immediately. For derivatives that are
designated and qualify as hedges of net investments in subsidiaries located outside the
United States, the gain or loss (net of tax), is reported in accumulated other
comprehensive income (loss) as part of the cumulative translation adjustment to the extent
the derivative is effective. For derivative instruments not designated as hedging
instruments, the gain or loss is recognized in current earnings during the period of
change. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Interest Rate Risk Management:
</I>The Corporation has designated each of its outstanding interest rate swap agreements
as fair value hedges of the underlying fixed rate obligation. The fair value of the
interest rate swap agreements is recorded in other current assets, other assets, other
current liabilities, or other long-term liabilities with a corresponding increase or
decrease in the fixed rate obligation. The changes in the fair value of the interest rate
swap agreements and the underlying fixed rate obligations are recorded as equal and
offsetting unrealized gains and losses in interest expense in the Consolidated Statement
of Earnings. The Corporation has structured all existing interest rate swap agreements to
be 100% effective. As a result, there is no current impact to earnings resulting from
hedge ineffectiveness. Gains or losses resulting from the early termination of interest
rate swaps are deferred as an increase or decrease to the carrying value of the related
debt and amortized as an adjustment to the yield of the related debt instrument over the
remaining period originally covered by the swap. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Foreign Currency Management:</I>
The fair value of foreign currency-related derivatives are generally included in the
Consolidated Balance Sheet in other current assets and other current liabilities. The
earnings impact of cash flow hedges relating to forecasted purchases of inventory is
reported in cost of goods sold to match the underlying transaction being hedged. Realized
and unrealized gains and losses on these instruments are deferred in accumulated other
comprehensive income (loss) until the underlying transaction is recognized in earnings. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
earnings impact of cash flow hedges relating to the variability in cash flows associated
with foreign currency-denominated assets and liabilities is reported in cost of goods
sold, selling, general, and administrative expenses, or other expense (income), depending
on the nature of the assets or liabilities being hedged. The amounts deferred in
accumulated other comprehensive income (loss) associated with these instruments generally
relate to foreign currency spot-rate to forward-rate differentials and are recognized in
earnings over the term of the hedge. The discount or premium relating to cash flow hedges
associated with foreign currency-denominated assets and liabilities is recognized in net
interest expense over the life of the hedge.</FONT></P>


 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Stock-Based Compensation: </B></I>As described
in Note 17, the Corporation has elected to follow the accounting provisions of Accounting
Principles Board Opinion (APBO) No. 25, <I>Accounting for Stock Issued to Employees</I>,
for stock-based compensation and to furnish the pro forma disclosures required under SFAS
No. 148,<I> Accounting for Stock-Based Compensation &#150; Transition and Disclosure</I>. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
reconciliation of the Corporation&#146;s net earnings to pro forma net earnings, and the
related pro forma earnings per share amounts, for the years ended December 31, 2005, 2004,
and 2003, is provided below. For purposes of pro forma disclosure, stock-based
compensation expense is recognized in accordance with the provisions of SFAS No. 123,
<I>Accounting for Stock-Based Compensation</I>. Further, pro forma stock-based
compensation expense is amortized to expense on a straight-line basis over the vesting
period. </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(DOLLARS IN MILLIONS EXCEPT PER SHARE DATA)</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>543.</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    456.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    293.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Adjustment to net earnings for:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Stock-based compensation expense included in</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;net earnings, net of tax</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Pro forma stock-based compensation (expense),</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;net of tax</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(19.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(22.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(19.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pro forma net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>532.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    445</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    276</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pro forma net earnings per common share&#151; basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.7</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      3.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pro forma net earnings per common share&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;assuming dilution</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.5</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      3.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>New Accounting Pronouncements:</B>
</I>In December 2004, the Financial Accounting Standards Board (FASB) issued SFAS No. 123
(revised 2004) (SFAS No. 123R), <I>Share-Based Payment</I>. SFAS No. 123R will require the
Corporation to expense share-based payments, including employee stock options, based on
their fair value. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SFAS
No. 123R permits public companies to adopt its requirements using one of two methods. The
first adoption method is a &#147;modified prospective&#148; method in which compensation
cost is recognized beginning with the effective date (i) based on the requirements of SFAS
No. 123R for all share-based payments granted after the effective date and (ii) based on
the requirements of SFAS No. 123 for all awards granted to employees prior to the
effective date of SFAS No. 123R that remain unvested on the effective date. The second
adoption method is a &#147;modified retrospective&#148; method, which includes the
requirements of the modified prospective method described above, but also permits entities
to</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>37</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>restate, based on the amounts previously recognized under SFAS No. 123 for purposes of
pro forma disclosures, either (i) all prior periods presented or (ii) prior interim
periods in the year of adoption. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is required to adopt SFAS No. 123R effective as of January 1, 2006, and plans
to utilize the modified retrospective method of adoption, restating all prior periods. As
permitted by SFAS No. 123, the Corporation currently accounts for share-based payments to
employees under APBO No. 25 using the intrinsic value method and, as such, generally
recognizes no compensation cost for employee stock options. Accordingly, the adoption of
SFAS No. 123R&#146;s fair value method will have a significant impact on the
Corporation&#146;s results of operations, although it will have no impact on the
Corporation&#146;s overall financial position. The impact of adoption of SFAS No. 123R
cannot be predicted at this time because it will depend on levels of share-based payments
granted in the future. However, had the Corporation adopted SFAS No. 123R in prior years,
the impact of that adoption would have approximated the impact of SFAS No. 123 as
described in the disclosure of pro forma net earnings and pro forma earnings per share in
the immediately preceding table. SFAS No. 123R also requires the benefits of tax
deductions in excess of recognized compensation cost to be reported as a financing cash
flow, rather than as an operating cash flow as currently presented. This requirement will
reduce net operating cash flows and increase net financing cash flows in periods after
adoption and, upon adoption in 2006, the Corporation will restate its prior Consolidated
Statements of Cash Flows to reflect this classification. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
November 2004, the FASB issued SFAS No. 151, <I>Inventory Costs</I>. The Corporation is
required to adopt the provisions of SFAS No. 151, on a prospective basis, as of January 1,
2006. SFAS No. 151 clarifies the accounting for abnormal amounts of idle facility expense,
freight, handling costs, and wasted material. SFAS No. 151 requires that those items
&#150; if abnormal &#150; be recognized as expenses in the period incurred. In addition,
SFAS No. 151 requires the allocation of fixed production overheads to the costs of
conversions based upon the normal capacity of the production facilities. The Corporation
does not believe that the adoption of SFAS No. 151 will have a material impact on its
financial position or results of operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A103></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 2: ACQUISITIONS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effective after the close of business
on October 2, 2004, the Corporation acquired the Porter-Cable and Delta Tools Group from
Pentair, Inc. The Porter-Cable and Delta Tools Group included the Porter-Cable, Delta,
DeVilbiss Air Power Company, Oldham Saw and FLEX businesses. The addition of the
Porter-Cable and Delta Tools Group to the Corporation&#146;s Power Tools and Accessories
segment allowed the Corporation to offer customers a broader range of products. The cash
purchase price for the transaction was approximately $783.8 million net of cash acquired
of $8.3 million and including transaction costs of $5.7 million. That cash purchase price
of $783.8 million included a 2004 payment of $21.8 million, on a preliminary basis, based
upon the estimated increase in the net assets of the Porter-Cable and Delta Tools Group,
and a $10.4 million reduction, received in 2005, representing a preliminary adjustment to
the purchase price. The final purchase price is subject to customary adjustments based
upon the changes in the net assets of the Porter-Cable and Delta Tools Group through the
closing date. The final purchase price has not yet been determined. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
transaction has been accounted for in accordance with SFAS No.141, <I>Business
Combinations</I>, and accordingly the financial position and results of operations have
been included in the Corporation&#146;s operations since the date of acquisition. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
purchase price allocation of the acquired businesses based upon independent appraisals and
management&#146;s estimates at the date of acquisition, in millions of dollars, is as
follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=78% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accounts receivable</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     202</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Inventories</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>172</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Property and equipment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>124</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Goodwill</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>351</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Intangible assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>189</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other current and long-term assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Total assets acquired</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,084</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accounts payable and accrued liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>225</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>75</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Total liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>301</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fair value of net assets acquired</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     783</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
purchase price allocation resulted in the recognition of $351.8 million of goodwill
primarily related to the anticipated future earnings and cash flows of the Porter-Cable
and Delta Tools Group, including the estimated effects of the integration of this business
into the Corporation&#146;s Power Tools and Accessories segment. The transaction also
generated $189.4 million in intangible assets of which $122.0 million were
indefinite-lived intangible assets related to trade names and $67.4 million related to
finite-lived intangible assets that will be amortized over periods of 10 to 15 years.
These intangible assets are reflected in other assets in</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>38</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>the Consolidated Balance Sheet.
The Corporation believes that approximately $325 million of the intangible assets and
goodwill recognized will be deductible for income tax purposes. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to the date of the acquisition of the Porter-Cable and Delta Tools Group and during the
fourth quarter of 2004, the Corporation identified opportunities to restructure the
acquired businesses as well as to integrate these businesses into its existing Power Tools
and Accessories segment. Subsequent to the acquisition, the Corporation approved
integration actions relating to the acquired businesses. These actions principally reflect
severance costs associated with administrative and manufacturing actions related to the
acquired businesses, including the closure of three manufacturing facilities, as well as
the cost of lease and other contractual obligations for which no future benefit will be
realized. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
summary of integration activity relating to the Porter-Cable and Delta Tools Group during
2005, in millions of dollars, is set forth below: </FONT></P>




<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SEVERANCE<BR>
&nbsp;BENEFITS
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;OTHER<BR>
CHARGES
</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TOTAL</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Integration reserve at December 31, 2004</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   8</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   6</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   14</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Adjustments to previously provided reserves</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Utilization of reserves:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Cash</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Integration reserve at December 31, 2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain
of these restructuring actions commenced in 2004 and the remainder commenced in early
2005. The Corporation expects that these restructuring actions will be completed by the
end of 2006. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
November 2005, the Corporation completed the sale of the FLEX business of the acquired
Porter-Cable and Delta Tools Group. The effect of the sale was not material to the
Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
March 2004, the Corporation acquired MasterFix for $7.9 million, net of cash acquired. The
results of MasterFix, included in the consolidated financial statements from the date of
acquisition, were not material. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
September 30, 2003, the Corporation acquired Baldwin Hardware Corporation (Baldwin) and
Weiser Lock Corporation (Weiser) from Masco Corporation for $277.8 million in cash,
including transaction costs of $2.8 million. Baldwin is a leading provider of
architectural and decorative products for the home. Weiser is a manufacturer of locksets
and decorative exterior hardware and accessories. These additions to the
Corporation&#146;s security hardware businesses, a component of its Hardware and Home
Improvement segment, allowed the Corporation to offer customers a broader range of styles
and price points. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s acquisition of Baldwin and Weiser has been accounted for in accordance
with SFAS No. 141, and accordingly, the financial position and results of operations have
been included in the Corporation&#146;s operations since the date of acquisition. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A104></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 3: DISCONTINUED
OPERATIONS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s former
European security hardware business is classified as discontinued operations. The European
security hardware business consisted of the NEMEF, Corbin, and DOM businesses. In November
2005, the Corporation completed the sale of the DOM security hardware business and
received cash proceeds, net of cash transferred, of $17.2 million. The final purchase
price is subject to customary adjustments based upon changes in the net assets of the DOM
security hardware business through the closing date. In January 2004, the Corporation
completed the sale of the NEMEF and Corbin businesses and received cash proceeds, net of
cash transferred, of $74.6 million. In September 2004, the Corporation received additional
cash proceeds of $2.9 million. These additional cash proceeds reflect the final adjustment
to the purchase price for the net assets of the NEMEF and Corbin businesses at the date of
closing. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2005, the Corporation recognized a $.1 million loss on the sale of the DOM security
hardware business. During 2004, the Corporation recognized a $12.7 million net gain on the
sale of these discontinued operations (the &#147;net gain on sale of discontinued
operations&#148;). That net gain consisted of a $37.1 million gain on the sale of the
NEMEF and Corbin businesses, less a $24.4 million goodwill impairment charge associated
with the DOM business. That goodwill impairment charge was determined as the excess of the
carrying value of goodwill associated with the DOM business over its implied fair value. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
European security hardware business discussed above is reported as discontinued operations
in the consolidated financial statements and all prior periods presented have been
adjusted to reflect this presentation. Sales and earnings before income taxes of the
discontinued operations for each year, in millions of dollars, were as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>60</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   66</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   119</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Earnings before income taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
results of the discontinued operations do not reflect any expense for interest allocated
by or management fees charged by the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
major classes of assets and liabilities of discontinued operations in the Consolidated
Balance Sheet as of December 31, 2004, in millions of dollars, were as follows: </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>39</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=87% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trade receivables, less allowances</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    9</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Inventories</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Property, plant, and equipment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Goodwill</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Total assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>70</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trade accounts payable</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other accrual liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Postretirement benefits and other long-term liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>29</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" --></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>

<A NAME=A105></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 4: INVENTORIES </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The classification of inventories at
the end of each year, in millions of dollars, was as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FIFO cost</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Raw materials and work-in-process</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>257</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   267</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Finished products</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>774</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>692</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,031</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>960</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Adjustment to arrive at</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;LIFO inventory value</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>17</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>1,049</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   981</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
cost of United States inventories stated under the LIFO method was approximately 58% and
53% of the value of total inventories at December 31, 2005 and 2004, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A106></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 5: PROPERTY, PLANT,
AND EQUIPMENT</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Property, plant, and equipment at the
end of each year, in millions of dollars, consisted of the following: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Property, plant, and equipment at cost:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Land and improvements</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>44</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      51</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Buildings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>309</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>299</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Machinery and equipment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,348</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,410</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,701</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,761</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Less accumulated depreciation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,033</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,007</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>668</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     754</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A107></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 6: GOODWILL AND
OTHER IDENTIFIED INTANGIBLE ASSETS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The changes in the carrying amount of
goodwill by reportable business segment, in million of dollars, was as follows: </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;POWER<BR>
&nbsp;&nbsp;&nbsp;&nbsp;TOOLS &amp;<BR>
ACCESSORIES
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;HARDWARE<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&amp; HOME<BR>
IMPROVEMENT
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;FASTENING &amp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;ASSEMBLY<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SYSTEMS
</FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TOTAL</FONT></TH></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=45% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Goodwill at January 1, 2004</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=13% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    25</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   458</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   287</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     771</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Acquisitions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>384</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>388</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Activity associated with prior year acquisition</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Currency translation adjustment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Balance at December 31, 2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>417</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>463</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>303</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,184</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Activity associated with prior year acquisition</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(31</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(31</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sale of business</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Currency translation adjustment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(19</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(21</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Balance at December 31, 2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   369</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   463</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   283</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,115</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>40</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
carrying amount of acquired intangible assets included in other assets at the end of each
year, in million of dollars, was as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Customer relationships</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(net of accumulated amortization</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;of $1.4 in 2005 and $.2 in 2004)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>36</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    11</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Technology and patents</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(net of accumulated amortization</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;of $2.8 in 2005 and $.9 in 2004)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>16</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trademarks and trade names</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(net of accumulated amortization</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;of $.4 in 2005)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>208</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>202</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total intangibles, net</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>261</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   231</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trademarks
and trade names include indefinite-lived assets of $193.9 million and $202.1 million at
December 31, 2005 and 2004, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2005, the Corporation obtained an independent appraisal that was required to finalize
certain aspects of the purchase price allocation related to the acquisition of the
Porter-Cable and Delta Tools Group which resulted in an increase in acquired intangible
assets and a corresponding reduction in goodwill. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible
asset amortization expense in 2005, 2004, and 2003 was $3.5 million, $1.0 million, and $.1
million, respectively.  At December 31, 2005, the weighted-average amortization periods
were 15 years for customer relationships, 10 years for technology and patents, and 10
years for trademarks and tradenames.  The estimated future amortization expense for identifiable
intangible assets during each of the next five years is $5.9 million. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A108></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 7: OTHER CURRENT
LIABILITIES </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other current liabilities at the end
of each year, in millions of dollars, included the following: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Trade discounts and allowances</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>242</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     254</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Redeemable preferred stock of subsidiary</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>192</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Employee benefits</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>157</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>154</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Salaries and wages</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>121</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>135</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Advertising and promotion</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>75</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>57</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Warranty</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>57</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>55</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income taxes, including deferred taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>101</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>51</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accruals related to restructuring actions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>All other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>313</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>372</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>1,075</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,294</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
other at December 31, 2005 and 2004, consisted primarily of accruals for foreign currency
derivatives, interest, insurance, and taxes other than income taxes. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following provides information with respect to the Corporation&#146;s warranty accrual, in
millions of dollars: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=64% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Warranty reserve at January 1</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>55</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   40</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accruals for warranties issued during</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;the period and changes in estimates</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;related to pre-existing warranties</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>116</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>91</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Settlements made</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(111</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(92</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Additions due to acquisitions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&nbsp;</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reduction due to sale of business</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Currency translation adjustments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Warranty reserve at December 31</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>57</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   55</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
December 2000, a subsidiary of the Corporation issued preferred shares to private
investors. The preferred shares were redeemable in December 2005. Holders of the
subsidiary&#146;s preferred shares were entitled to annual cash dividends of $10.7
million. The $10.7 million dividends on those preferred shares were classified as interest
expense. The preferred shares were redeemed in December 2005 via a $136.0 million payment
to the private investors and the relinquishment of a liquid asset in the amount of $50.0
million that was included in other current assets at December 31, 2004. Included in other
current liabilities at December 31, 2004, was $192.2 million related to those preferred
shares. The carrying value of the preferred shares included the effect of the fair value
of the interest rate swap agreement related to this obligation. </FONT></P>

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<A NAME=A109></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 8: SHORT-TERM
BORROWINGS </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Short-term borrowings in the amounts
of $566.9 million and $1.1 million at December 31, 2005 and 2004, respectively, consisted
primarily of borrowings under the terms of the Corporation&#146;s commercial paper
program, uncommitted lines of credit or other short-term borrowing arrangements. The
weighted-average interest rate on short-term borrowings outstanding was 4.56% at December
31, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
November 2002, the Corporation entered into a $500 million agreement under which it may
issue commercial paper at market rates with maturities of up to 365 days from the date of
issue. In September 2004, the Corporation increased the maximum amount authorized for
issuance under its commercial paper program from $500 million to $1.0 billion. There was
$467.2 million outstanding under this agreement at December 31, 2005. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>41</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
April 2001, the Corporation entered into a $1.0 billion unsecured revolving credit
facility that expires in April 2006. In October 2004, the Corporation replaced its $1.0
billion unsecured revolving credit facility (the Former Credit Facility) that would have
expired in April 2006 with a $1.0 billion unsecured revolving credit facility (the Credit
Facility) that expires in October 2009. The amount available for borrowing under the
Credit Facility at December 31, 2005 and 2004, was $532.8 million and $1.0 billion,
respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
average borrowings outstanding under the Corporation&#146;s unsecured revolving credit
facilities and commercial paper program during 2005 and 2004 were $213.8 million and
$274.5 million, respectively. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
the Credit Facility, the Corporation has the option of borrowing at LIBOR plus a specified
percentage, or at other variable rates set forth therein. The Credit Facility provides
that the interest rate margin over LIBOR, initially set at .375%, will increase (by a
maximum amount of .625%) or decrease (by a maximum amount of .115%) based upon changes in
the ratings of the Corporation&#146;s long-term senior unsecured debt. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to interest payable on the principal amount of indebtedness outstanding from time
to time under the Credit Facility, the Corporation is required to pay an annual facility
fee, equal to .125%, of the amount of the Credit Facility&#146;s commitment, whether used
or unused. The Corporation is also required to pay a utilization fee, equal to .125%,
applied to the outstanding balance when borrowings under the Credit Facility exceed 50% of
the Credit Facility. The Credit Facility provides that both the facility fee and the
utilization fee will increase or decrease based upon changes in the ratings of the
Corporation&#146;s long-term senior unsecured debt. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Credit Facility includes various customary covenants. Some of the covenants limit the
ability of the Corporation and its subsidiaries to pledge assets or incur liens on assets.
Other financial covenants require the Corporation to maintain a specified leverage ratio
and interest coverage ratio. As of December 31, 2005, the Corporation was in compliance
with all terms and conditions of the Credit Facility. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
the Former Credit Facility, the Corporation had the option of borrowing at LIBOR plus a
specified percentage, or at other variable rates set forth therein. The Former Credit
Facility provided that the interest rate margin over LIBOR, initially set at .475%, would
increase or decrease based upon changes in the ratings of the Corporation&#146;s long-term
senior unsecured debt. The Former Credit Facility provided for an interest rate margin
over LIBOR of .475% during 2004 and 2003. In addition to the interest payable on the
principal amount of indebtedness outstanding from time to time under the Former Credit
Facility, the Corporation was required to pay an annual facility fee to each bank, equal
to .150% and .125%, respectively, of the amount of each bank&#146;s commitment, whether
used or unused. The Corporation was also required to pay a utilization fee under the
Former Credit Facility equal to .125%, applied to the outstanding balance when borrowings
exceeded 50% of the facility. The Former Credit Facility provided that both the facility
fee and the utilization fee would increase or decrease based upon changes in the ratings
of the Corporation&#146;s senior unsecured debt. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
the terms of uncommitted lines of credit at December 31, 2005, certain subsidiaries
outside of the United States may borrow up to an additional $399.0 million on such terms
as may be mutually agreed. These arrangements do not have termination dates and are
reviewed periodically. No material compensating balances are required or maintained. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A110></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 9: LONG-TERM DEBT</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The composition of long-term debt at
the end of each year, in millions of dollars, was as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.0% notes due 2006</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>154</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     154</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.55% notes due 2007</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>150</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>150</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.125% notes due 2011</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
<TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(including discount of $1.7 in 2005 and $2.0 in 2004)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>398</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>398</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.75% notes due 2014</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;(including discount of $2.0 in 2005 and $2.2 in 2004)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>298</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>297</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.05% notes due 2028</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>150</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>150</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other loans due through 2009</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fair value hedging adjustment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>33</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Less current maturities of long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(155</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>1,030</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,200</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 1, at December 31, 2005 and 2004, the carrying amount of
long-term debt and current maturities thereof includes $33.7 million and $49.2 million,
respectively, relating to outstanding or terminated fixed-to-variable rate interest rate
swaps agreements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indebtedness
of subsidiaries in the aggregate principal amounts of $867.8 million and $302.6 million
were included in the Consolidated Balance Sheet at December 31, 2005 and 2004,
respectively, in short-term borrowings, current maturities of long-term debt, and
long-term debt. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Principal
payments on long-term debt obligations due over the next five years are as follows: $155.1
million in 2006, $150.2 million in 2007, $.2 million in 2008, and $.1 million in 2009.
There are no principal payments due in 2010. Interest payments on all indebtedness were
$94.3 million in 2005, $77.2 million in 2004, and $80.3 million in 2003. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>42</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A111></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 10: DERIVATIVE
FINANCIAL INSTRUMENTS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation is exposed to market
risks arising from changes in interest rates. With products and services marketed in over
100 countries and with manufacturing sites in 11 countries, the Corporation also is
exposed to risks arising from changes in foreign exchange rates. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Credit Exposure:</B></I> The Corporation is
exposed to credit-related losses in the event of non-performance by counterparties to
certain derivative financial instruments. The Corporation monitors the creditworthiness of
the counterparties and presently does not expect default by any of the counterparties. The
Corporation does not obtain collateral in connection with its derivative financial
instruments. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
credit exposure that results from interest rate and foreign exchange contracts is the fair
value of contracts with a positive fair value as of the reporting date. Some derivatives
are not subject to credit exposures. The fair value of all financial instruments is
summarized in Note 11. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Interest Rate Risk Management:</B>
</I>The Corporation manages its interest rate risk, primarily through the use of interest
rate swap agreements, in order to achieve a cost-effective mix of fixed and variable rate
indebtedness. It seeks to issue debt opportunistically, whether at fixed or variable
rates, at the lowest possible costs. The Corporation may, based upon its assessment of the
future interest rate environment, elect to manage its interest rate risk associated with
changes in the fair value of its indebtedness, or the future cash flows associated with
its indebtedness, through the use of interest rate swaps. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
amounts exchanged by the counterparties to interest rate swap agreements normally are
based upon the notional amounts and other terms, generally related to interest rates, of
the derivatives. While notional amounts of interest rate swaps form part of the basis for
the amounts exchanged by the counterparties, the notional amounts are not themselves
exchanged and, therefore, do not represent a measure of the Corporation&#146;s exposure as
an end user of derivative financial instruments. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s portfolio of interest rate swap instruments at December 31, 2005 and
2004, consisted of $525.0 million notional and $788.0 million notional amounts of
fixed-to-variable rate swaps with a weighted-average fixed rate receipt of 5.33% and
5.59%, respectively. The basis of the variable rate paid is LIBOR. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit
exposure on the Corporation&#146;s interest rate derivatives at December 31, 2005 and
2004, was $9.2 million and $32.8 million, respectively. Deferred gains on the early
termination of interest rate swaps were $29.7 million and $27.8 million at December 31,
2005 and 2004. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Foreign Currency Management:</B>
</I>The Corporation enters into various foreign currency contracts in managing its foreign
currency exchange risk. Generally, the foreign currency contracts have maturity dates of
less than twenty-four months. The contractual amounts of foreign currency derivatives,
principally forward exchange contracts and purchased options, generally are exchanged by
the counterparties. The Corporation&#146;s foreign currency derivatives are designated to,
and generally are denominated in the currencies of, the underlying exposures. To minimize
the volatility of reported equity, the Corporation may hedge, on a limited basis, a
portion of its net investment in subsidiaries located outside the United States through
the use of foreign currency forward contracts and purchased foreign currency options. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation seeks to minimize its foreign currency cash flow risk and hedges its foreign
currency transaction exposures (that is, currency exposures related to assets and
liabilities) as well as certain forecasted foreign currency exposures. Hedges of
forecasted foreign currency exposures principally relate to the cash flow risk relating to
the sales of products manufactured or purchased in a currency different from that of the
selling subsidiary. The Corporation hedges its foreign currency cash flow risk through the
use of forward exchange contracts and, to a small extent, options. Some of the forward
exchange contracts involve the exchange of two foreign currencies according to the local
needs of the subsidiaries. Some natural hedges also are used to mitigate risks associated
with transaction and forecasted exposures. The Corporation also responds to foreign
exchange movements through various means, such as pricing actions, changes in cost
structure, and changes in hedging strategies. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>43</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table summarizes the contractual amounts of forward exchange contracts as of
December 31, 2005 and 2004, in millions of dollars, including details by major currency as
of December 31, 2005. Foreign currency amounts were translated at current rates as of the
reporting date. The &#147;Buy&#148; amounts represent the United States dollar equivalent
of commitments to purchase currencies, and the &#147;Sell&#148; amounts represent the
United States dollar equivalent of commitments to sell currencies. </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AS OF DECEMBER 31, 2005</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> BUY</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SELL</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>United States dollar</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,462</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (1,197</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pound sterling</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>938</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(661</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Euro</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>412</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(697</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Canadian dollar</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(122</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Australian dollar</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>32</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(56</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Czech koruna</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Japanese yen</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(43</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Swedish krona</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(66</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Swiss franc</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(17</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Norwegian krone</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(24</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Danish krone</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(18</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,950</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (2,954</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AS OF DECEMBER 31, 2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Total</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,130</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (3,139</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
options to buy or sell currencies were outstanding at December 31, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit
exposure on foreign currency derivatives as of December 31, 2005 and 2004, was $18.2
million and $52.2 million, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Hedge
ineffectiveness and the portion of derivative gains and losses excluded from the
assessment of hedge effectiveness related to the Corporation&#146;s cash flow hedges that
were recorded to earnings during 2005, 2004, and 2003 were not significant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amounts
deferred in accumulated other comprehensive income (loss) at December 31, 2005, that are
expected to be reclassified into earnings during 2006 represent an after-tax gain of $4.6
million. The amount expected to be reclassified into earnings in the next twelve months
includes unrealized gains and losses related to open foreign currency contracts.
Accordingly, the amount that is ultimately reclassified into earnings may differ
materially. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A112></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 11: FAIR VALUE OF
FINANCIAL INSTRUMENTS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The fair value of a financial
instrument represents the amount at which the instrument could be exchanged in a current
transaction between willing parties, other than in a forced sale or liquidation.
Significant differences can arise between the fair value and carrying amount of financial
instruments that are recognized at historical cost amounts. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following methods and assumptions were used by the Corporation in estimating fair value
disclosures for financial instruments:</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; Cash and cash equivalents, trade
receivables, certain other current assets, short-term borrowings, and current maturities
of long-term debt: The amounts reported in the Consolidated Balance Sheet approximate fair
value.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; Long-term debt: Publicly traded debt is valued based on quoted market
values. The fair value of other long-term debt is estimated based on quoted market prices
for the same or similar issues or on the current rates offered to the Corporation for debt
of the same remaining maturities. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; Other current liabilities: The
fair value of a subsidiary&#146;s redeemable preferred shares is based on the present
value of the cash flows associated with these preferred shares, discounted at current
market yields. &#149; Interest rate hedges: The fair value of interest rate hedges
reflects the estimated amounts that the Corporation would receive or pay to terminate the
contracts at the reporting date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; Foreign currency contracts:
The fair value of forward exchange contracts and options is estimated using prices
established by financial institutions for comparable instruments. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth, in millions of dollars, the carrying amounts and fair values
of the Corporation&#146;s financial instruments, except for those noted above for which
carrying amounts approximate fair values: </FONT></P>




<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ASSETS (LIABILITIES)   <BR>
AS OF DECEMBER 31, 2005
</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CARRYING<BR>
&nbsp;&nbsp;AMOUNT
</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;FAIR<BR>
VALUE
</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Non-derivatives:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (1,030</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (1,039</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Derivatives relating to:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Foreign Currency</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(23</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(23</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<BR>
<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ASSETS (LIABILITIES)   <BR>
AS OF DECEMBER 31, 2004
</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CARRYING<BR>
&nbsp;&nbsp;AMOUNT
</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;FAIR<BR>
VALUE
</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Non-derivatives:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other current liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    (192</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    (192</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Long-term debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1,200</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1,247</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Derivatives relating to:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other current liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Debt</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>27</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>27</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Foreign Currency</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(61</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(61</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>44</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A113></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 12: INCOME TAXES</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Earnings from continuing operations
before income taxes for each year, in millions of dollars, were as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>United States</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>416</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   308</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   189</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other countries</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>402</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>295</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>201</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>819</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   604</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   390</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Significant components of income
taxes (benefits) from continuing operations for each year, in millions of dollars, were as
follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Current:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;United States</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>223</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   108</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    69</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other countries</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>39</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>23</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>263</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>157</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>92</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Deferred:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;United States</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other countries</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>17</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>11</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>275</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   163</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   103</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income
tax expense recorded directly as an adjustment to equity as a result of hedging activities
was not significant in 2005, 2004, and 2003. Income tax benefits recorded directly as an
adjustment to equity as a result of employee stock options were $18.2 million, $31.2
million, and $1.3 million in 2005, 2004, and 2003, respectively. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income
tax payments were $165.8 million in 2005, $89.5 million in 2004, and $82.0 million in
2003.</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred
 tax (liabilities) assets at the end of each year, in millions of dollars,
were composed of the following: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Deferred tax liabilities:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Fixed assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>(8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (10</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Employee and postretirement benefits</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(157</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(157</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(27</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Gross deferred tax liabilities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(194</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(177</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Deferred tax assets:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Tax loss carryforwards</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>116</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>114</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Tax credit and capital loss</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;carryforwards</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>50</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Postretirement benefits</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>122</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>112</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>126</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>140</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Gross deferred tax assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>416</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>421</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Deferred tax asset valuation allowance</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(105</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(104</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net deferred tax assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>116</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   139</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other
deferred tax assets principally relate to accrued liabilities that are not currently
deductible. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred
income taxes are included in the Consolidated Balance Sheet in other current assets, other
assets, other current liabilities, and deferred income taxes. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax
loss carryforwards at December 31, 2005, consisted of net operating losses expiring from
2006 to 2011. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
American Jobs Creation Act of 2004 (the AJCA) introduced a special one-time dividends
received deduction on the repatriation of certain foreign earnings to the United States,
during a one-year period. The deduction results in an approximate 5.25% federal income tax
rate on eligible repatriations of foreign earnings. During the fourth quarter of 2005, the
Corporation&#146;s Chief Executive Officer and Board of Directors approved a domestic
reinvestment plan as required by the AJCA. During the fourth quarter of 2005, the
Corporation repatriated $888.3 million of previously unremitted foreign earnings and
recognized $51.2 million of tax expense related to the repatriation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
December 31, 2005, unremitted earnings of subsidiaries outside of the United States were
approximately $1.2 billion, on which no United States taxes had been provided. The
Corporation&#146;s intention is to reinvest these earnings permanently or to repatriate
the earnings only when possible to do so at minimal additional tax cost. It is not
practicable to estimate the amount of additional taxes that might be payable upon
repatriation of foreign earnings. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
reconciliation of income taxes at the federal statutory rate to the Corporation&#146;s
income taxes for each year, both from continuing operations, in millions of dollars, is as
follows: </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income taxes at federal</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;statutory rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>286</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   211</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   136</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Taxes associated with repatriation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;of foreign earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>51</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Lower effective taxes on</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;earnings in other countries</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(62</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(55</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other&#151; net</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>275</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   163</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   103</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>45</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A114></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 13: POSTRETIREMENT
BENEFITS </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The following table sets forth the
funded status of the defined benefit pension and postretirement plans, and amounts
recognized in the Consolidated Balance Sheet, in millions of dollars. The Corporation uses
a measurement date of September 30 for the majority of its defined benefit pension and
postretirement plans. Defined postretirement benefits consist of several unfunded health
care plans that provide certain postretirement medical, dental, and life insurance
benefits for most United States employees. The post-retirement medical benefits are
contributory and include certain cost-sharing features, such as deductibles and
co-payments. </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="6" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS<BR>
PLANS IN THE  <BR>
UNITED STATES
</FONT></TD>
     <TD COLSPAN=6 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS   <BR>
PLANS OUTSIDE OF THE <BR>
UNITED STATES
</FONT></TD>
     <TD COLSPAN=6 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>OTHER<BR>POSTRETIREMENT<BR>
BENEFITS<BR>
ALL PLANS
</FONT></TD></TR>
<TR>
     <TD COLSPAN=3>&nbsp;</TD>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=44% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CHANGE IN BENEFIT OBLIGATION</B></FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=5% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=5% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Benefit obligation at beginning of year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>994.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    942.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>733.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    632.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>144.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    157.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Service cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>23.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>17.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>13.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><B>.</B></B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Interest cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>57.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>37.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan participants' contributions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Actuarial losses (gains)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>23.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>74.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(11.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Foreign currency exchange rate changes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(76.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>55.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Benefits paid</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(62.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(61.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(29.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(27.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(21.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(21.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Acquisitions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>45.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan amendments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>14.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(32.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Curtailments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(5.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Benefit obligation at end of year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,045.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>994.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>757.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>733.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>103.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>144.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CHANGE IN PLAN ASSETS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fair value of plan assets at beginning of year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>847.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>785.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>441.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>375.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Actual return on plan assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>106.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>97.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>85.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Expenses</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(7.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Benefits paid</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(62.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(61.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(29.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(26.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(21.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(21.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Employer contributions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>15.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>15.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Contributions by plan participants</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Acquisitions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effects of currency exchange rates</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(45.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fair value of plan assets at end of year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>890.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>847.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>468.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>441.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Funded status</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(155.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(147.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(288.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(292.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(103.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(144.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unrecognized net actuarial loss</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>385.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>411.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>276.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>291.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>20.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>24.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unrecognized prior service cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>17.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>11.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(35.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Contributions subsequent to measurement date</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Prepaid (accrued) benefit cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>247.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    268.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     16.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>(118.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (125.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>AMOUNTS RECOGNIZED IN THE</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>CONSOLIDATED BALANCE SHEET</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Prepaid benefit cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>       <B>44.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     44.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   </FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   </FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   </FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  </FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accrued benefit cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(106.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(102.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(212.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(224.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(118.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(125.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Intangible asset</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>12.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accumulated other comprehensive income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>302.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>322.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>203.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>227.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net amount recognized</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>247.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    268.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     16.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>(118.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (125.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3)</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>WEIGHTED-AVERAGE ASSUMPTIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>USED TO DETERMINE BENEFIT</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>OBLIGATIONS AS OF MEASUREMENT</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>DATE</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Discount rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5.7</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.0</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Rate of compensation increase</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3.9</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B></B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>46</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
allocation, by asset category, of assets of defined benefit pension plans in the United
States at September 30, 2005 and 2004, respectively, were as follows: </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN=3 ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLAN ASSETS AT SEPTEMBER 30</FONT></TD>
     <TH COLSPAN="3" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="62%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Equity Securities</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="4%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>72</B></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD WIDTH="14%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>69</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fixed Income Securities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>26</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Alternative Investments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>100</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>At September 30, 2005, the
Corporation&#146;s targeted allocation, by asset category, of assets of defined benefit
pension plans in the United States is equity securities 65% (comprised of 50% U.S. and 15%
non-U.S. equities); fixed income securities &#150; 30%; and alternative investments &#150;
5%. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
allocation, by asset category, of assets of defined benefit pension plans outside of the
United States at September 30, 2005 and 2004, respectively, were as follows: </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN=3 ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLAN ASSETS AT SEPTEMBER 30</FONT></TD>
     <TH COLSPAN="3" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="62%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Equity Securities</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="4%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>70</B></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD WIDTH="14%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>67</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fixed Income Securities</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>22</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>25</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Real Estate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>100</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
September 30, 2005, the Corporation&#146;s targeted allocation, by asset category, of
assets of defined benefit pension plans outside of the United States is equity securities
&#150; 68%; fixed income securities &#150; 25%; and real estate &#150; 7%. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
the extent that the actual allocation of plan assets differs from the targeted allocation
by more than 5% for any category, plan assets are re-balanced within three months. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation establishes its estimated long-term return on plan assets considering various
factors, which include the targeted asset allocation percentages, historic returns, and
expected future returns. Specifically, the factors are considered in the fourth quarter of
the year preceding the year for which those assumptions are applied. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
accumulated benefit obligation of certain plans in the United States and outside of the
United States exceeded the fair value of plan assets. As required by accounting principles
generally accepted in the United States, the Corporation reflected a minimum pension
liability of approximately $505.9 million in the Consolidated Balance Sheet at December
31, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
accumulated benefit obligation related to all defined benefit pension plans and
information related to unfunded and underfunded defined benefit pension plans at the end
of each year, in millions of dollars, follows: </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
    <TH COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
    <TD COLSPAN="5" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS <BR>
PLANS IN THE   <BR>
UNITED STATES
</FONT></TD>
<TH COLSPAN=1><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
  <TD COLSPAN="5" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS<BR>
PLANS OUTSIDE OF THE<BR>
UNITED STATES
</FONT></TD></TR>
<TR>
     <TD COLSPAN=4>&nbsp;</TD>
     <TD COLSPAN=11><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>


<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>

<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="42%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>All defined benefit plans:</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="12%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="11%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="11%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="14%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Accumulated benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <B>963</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   926</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>684</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   666</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Unfunded defined benefit plans:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Projected benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>97</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>109</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>99</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Accumulated benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>72</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>73</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>100</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>93</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Defined benefit plans with an accumulated benefit </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;obligation in excess of the fair value of plan assets:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Projected benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,003</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>953</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>757</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>733</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Accumulated benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>920</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>885</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>684</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>666</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Fair value of plan assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>818</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>778</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>468</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>441</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth, in millions of dollars, benefit payments, which reflect
expected future service, as appropriate, expected to be paid in the periods indicated. </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="3" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS PLANS<BR>IN THE UNITED STATES</FONT></TD>
     <TD COLSPAN=3 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS PLANS<BR>OUTSIDE OF THE UNITED STATES </FONT></TD>
     <TD COLSPAN=3 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>OTHER POSTRETIREMENT<BR> BENEFITS ALL PLANS</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=26% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2006</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    63</FONT></TD>
        <TD WIDTH=12% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    27</FONT></TD>
        <TD WIDTH=12% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD WIDTH=12% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   10</FONT></TD>
        <TD WIDTH=12% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2007</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>63</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2008</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>66</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>29</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2009</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>66</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>30</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2010</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>66</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>31</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2011-2015</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>367</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>173</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>47</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
net periodic cost (benefit) related to the defined benefit pension plans included the
following components, in millions of dollars: </FONT></P>


 <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="9" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS<BR>PLANS IN THE UNITED STATES </FONT></TD>
     <TD COLSPAN=9 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PENSION BENEFITS<BR>PLANS OUTSIDE OF THE UNITED STATES</FONT></TD></TR>
<TR>
     <TD COLSPAN=3>&nbsp;</TD>
     <TD COLSPAN=18><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>


<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TH COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TD COLSPAN=3 ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD></TR>

<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="44%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Service cost</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="8%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>24.</B></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD WIDTH="8%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    19.</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    16.</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD WIDTH="11%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>13.</B></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    13.</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    13.</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Interest cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>57.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>37.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>27.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Expected return on plan assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(80.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(82.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(87.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(34.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(35.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(31.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amortization of the unrecognized</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;transition obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amortization of prior service cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Curtailment/settlement loss</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amortization of net actuarial loss</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>21.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>12.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net periodic cost (benefit)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>24.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     8.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    (2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>29.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    25.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    15.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>WEIGHTED-AVERAGE ASSUMPTIONS</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>USED IN DETERMINING NET</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;<B>PERIODIC (BENEFIT) COST FOR YEAR:</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Discount rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.0</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5.4</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Expected return on plan assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8.7</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7.5</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Rate of compensation increase</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4.0</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
net periodic cost related to the defined benefit postretirement plans included the
following components, in millions of dollars: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Service cost</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Interest cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amortization of prior service cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amortization of net actuarial loss</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Curtailment gain</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net periodic cost</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>7.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    8.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    11.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Weighted-average discount rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;used in determining net</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;periodic cost for year</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6.2</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0%</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
health care cost trend rate used to determine the postretirement benefit obligation was
9.25% for 2006. This rate decreases gradually to an ultimate rate of 5.0% in 2011, and
remains at that level thereafter. The trend rate is a significant factor in determining
the amounts reported. A one-percentage-point change in these assumed health care cost
trend rates would have the following effects, in millions of dollars: </FONT></P>



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<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ONE-PERCENTAGE-POINT</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>INCREASE</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(DECREASE)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=64% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effect on total of service and</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;interest cost components</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effect on postretirement</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;benefit obligation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the fourth quarter of 2005, the Corporation adopted plan amendments for two of its
non-qualified pension plans in the United States to permit certain participants to elect
to receive their benefits under the plans in five equal annual installments or in the form
of a lump sum payment, depending upon the age of the participant at retirement. Those
amendments increased the Corporation&#146;s liability for pension benefits by
approximately $13.1 million. This increase in the liability will be amortized as prior
service cost over approximately 9 years. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the fourth quarter of 2005, the Corporation adopted a plan amendment to eliminate the
prescription drug benefit previously available to substantially all retirees under the
Medicare supplemental plan, which was replaced by a prescription drug benefit under
Medicare (Medicare Part D). That amendment reduced the Corporation&#146;s liability for
postretirement health benefits by approximately $32.7 million. This reduction in the
liability will be amortized as a prior service credit over approximately 10 years. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2006, the Corporation expects to make cash contributions of approximately $20.0 million to
its defined benefit pension plans. The amounts principally represent contributions
required by funding regulations or laws or those related to unfunded plans necessary to
fund current benefits. In addition, the Corporation expects to continue to make
contributions in 2006 sufficient to fund benefits paid under its other postretirement
benefit plans during that year, net of contributions by plan participants. Such
contributions totaled $15.0 million in 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expense
for defined contribution plans amounted to $12.7 million, $11.8 million, and $10.4 million
in 2005, 2004, and 2003, respectively. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>48</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A115></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 14: OTHER LIABILITIES</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>At December 31, 2005 and 2004, other
long-term liabilities included a reserve of $248.3 million and $239.7 million,
respectively, associated with various tax matters in a number of jurisdictions. </FONT></P>

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<A NAME=A116></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 15:
STOCKHOLDERS&#146; EQUITY </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation repurchased
6,276,700, 66,100, and 2,011,570 shares of its common stock during 2005, 2004, and 2003 at
an aggregate cost of $525.7 million, $3.6 million, and $77.5 million, respectively. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, the Corporation adopted a restricted stock plan. A total of 1,000,000 shares of
restricted stock were authorized under this plan. As of December 31, 2005, 437,696 shares
of common stock were issued and outstanding and 562,304 shares of common stock were
reserved for future grants. Under the Plan, eligible employees are awarded restricted
shares of the Corporation&#146;s common stock. Restrictions on awards generally expire
from three to four years after issuance, subject to continuous employment and certain
other conditions. Restricted stock awards are recorded at market value on the date of the
grant as unearned compensation. Unearned compensation is shown as a reduction of
stockholders&#146; equity and is amortized to expense over the restriction period. Expense
recognized relating to restricted stock awards was $6.8 million and $2.8 million in 2005
and 2004, respectively. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SFAS
No. 130, <I>Reporting Comprehensive Income</I>, defines comprehensive income as
non-stockholder changes in equity. Accumulated other comprehensive income (loss) at the
end of each year, in millions of dollars, included the following: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Foreign currency translation adjustment</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>(54</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7)</B></FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    65</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net gain (loss) on derivative instruments, net of tax</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(28</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Minimum pension liability adjustment, net of tax</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(337</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(368</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  <B>(385</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>  (330</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8)</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation has designated certain intercompany loans and foreign currency derivative
contracts as long-term investments in certain foreign subsidiaries and foreign currency
derivative contracts. Net translation gains associated with these designated intercompany
loans and foreign currency derivative contracts in the amounts of $6.5 million and $7.6
million were recorded in the foreign currency translation adjustment in 2005 and 2004,
respectively. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign
currency translation adjustments are not generally adjusted for income taxes as they
relate to indefinite investments in foreign subsidiaries. The minimum pension liability
adjustments as of December 31, 2005 and 2004, are net of taxes of $168.3 million and
$181.4 million, respectively. </FONT></P>

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<A NAME=A117></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 16: EARNINGS PER
SHARE </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The computations of basic and diluted
earnings per share for each year were as follows: </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(AMOUNTS IN MILLIONS<BR>EXCEPT PER SHARE DATA)</FONT></TD>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Numerator:</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Net earnings from continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>544.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    441.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    287.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Net (loss) earnings from discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    <B>543.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    456.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    293.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Denominator:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Denominator for basic earnings per share&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;weighted-average shares</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>79.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>79.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Employee stock options and stock issuable under</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;employee benefit plans</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Denominator for diluted earnings per share&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;adjusted weighted-average shares and</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;assumed conversions</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>81.</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>81.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>78.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Basic earnings per share</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Basic earnings per share</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.8</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Diluted earnings per share</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Discontinued operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Diluted earnings per share</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      <B>6.6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>      5.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following options to purchase shares of common stock were outstanding during each year,
but were not included in the computation of diluted earnings per share because the effect
would be anti-dilutive. The options indicated below were anti-dilutive because the related
exercise price was greater than the average market price of the common shares for the
year. </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT" WIDTH="46%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Number of options (in millions)</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="LEFT" WIDTH="16%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B></B></FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Weighted-average exercise price</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    56.1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>47.3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A118></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 17: STOCK-BASED
COMPENSATION </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation has elected to follow
APBO No. 25, <I>Accounting for Stock Issued to Employees</I>, and related interpretations
in accounting for its stock-based compensation. In addition, the Corporation provides pro
forma disclosure of stock-based compensation, as measured under the fair value
requirements of SFAS No. 123, <I>Accounting for Stock-Based Compensation</I>. These pro
forma disclosures are provided in Note 1 as required under SFAS No. 148, <I>Accounting for
Stock-Based Compensation &#150; Transition and Disclosure</I>. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>49</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;APBO
No. 25 requires no recognition of compensation expense for most of the stock-based
compensation arrangements provided by the Corporation, namely, broad-based employee stock
purchase plans and option grants where the exercise price is equal to the market value at
the date of grant. However, APBO No. 25 requires recognition of compensation expense for
variable award plans over the vesting periods of such plans, based upon the then-current
market values of the underlying stock. In contrast, SFAS No. 123 requires recognition of
compensation expense for grants of stock, stock options, and other equity instruments over
the vesting periods of such grants, based on the estimated grant-date fair values of those
grants. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
various stock option plans, options to purchase common stock may be granted until 2013.
Options generally are granted at fair market value at the date of grant, are exercisable
in installments beginning one year from the date of grant, and expire 10 years after the
date of grant. The plans permit the issuance of either incentive stock options or
non-qualified stock options, which, for certain of the plans, may be accompanied by stock
or cash appreciation rights or limited stock appreciation rights. Additionally, certain
plans allow for the granting of stock appreciation rights on a stand-alone basis. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of December 31, 2005, 6,271,898 non-qualified stock options were outstanding under
domestic plans. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
all plans, there were 3,510,642 shares of common stock reserved for future grants as of
December 31, 2005. Transactions are summarized as follows: </FONT></P>




<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>STOCK<BR>OPTIONS</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> WEIGHTED-<BR>AVERAGE<BR>EXERCISE<BR>PRICE</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="65%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Outstanding at December 31, 2002</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9,380,414</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="14%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    43</FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.92</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Granted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,417,850</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>39</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.73</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Exercised</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>321,938</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.08</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Forfeited</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>118,413</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>45</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.77</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Outstanding at December 31, 2003</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10,357,913</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>43</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.60</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Granted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>710,325</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>62</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.34</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Exercised</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,917,697</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>43</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.41</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Forfeited</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>161,627</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.87</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Outstanding at December 31, 2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6,988,914</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>45</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.58</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Granted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>759,275</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>82</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.26</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Exercised</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,268,653</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.15</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Forfeited</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>207,638</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>59</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.19</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Outstanding at December 31, 2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6,271,898</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.86</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Shares exercisable at</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;December 31, 2003</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6,406,323</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.83</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Shares exercisable at</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;December 31, 2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,567,223</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    45</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.18</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Shares exercisable at</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;December 31, 2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,218,635</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.65</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exercise
prices for options outstanding as of December 31, 2005, ranged from $30.00 to $91.33. The
following table provides certain information with respect to stock options outstanding at
December 31, 2005: </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>RANGE OF<BR>
EXERCISE PRICES
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>STOCK<BR>OPTIONS<BR>
OUTSTANDING
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WEIGHTED-<BR>
AVERAGE<BR>
EXERCISE<BR>
PRICE
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WEIGHTED-<BR>AVERAGE<BR>
REMAINING<BR>
CONTRACTUAL<BR>
LIFE
</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Under $41.99</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,681,189</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    37</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.05</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.27</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$41.99-$58.79</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,285,415</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>47</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.25</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.52</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Over $58.79</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,305,294</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>72</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.91</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.89</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6,271,898</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    49</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.86</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.90</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table provides certain information with respect to stock options exercisable at
December 31, 2005: </FONT></P>





<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>RANGE OF<BR>EXERCISE PRICES</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>STOCK<BR>OPTIONS<BR>EXERCISABLE</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WEIGHTED-<BR>AVERAGE<BR>EXERCISE PRICE</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=62% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Under $41.99</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,063,614</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    35</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.48</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$41.99-$58.79</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,028,780</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>47</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.16</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Over $58.79</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>126,241</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>61</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.68</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4,218,635</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    44</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.65</FONT></TD></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
weighted-average fair values at date of grant for options granted during 2005, 2004, and
2003 were $26.12, $20.46, and $13.31, respectively, and were estimated using the
Black-Scholes option valuation model with the following weighted-average assumptions: </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Expected life in years</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>5.</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>7</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Interest rate</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4.0</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Volatility</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>31</B>.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>0%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>31.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>32.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dividend yield</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1.3</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6%</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1%</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
weighted-average fair value at the date of grant for restricted stock granted in 2005 and
2004 was $77.83 and $54.43, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A119></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 18: BUSINESS
SEGMENTS AND GEOGRAPHIC INFORMATION </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation has elected to
organize its businesses based principally upon products and services. In certain instances
where a business does not have a local presence in a particular country or geographic
region, however, the Corporation has assigned responsibility for sales of that
business&#146;s products to one of its other businesses with a presence in that country or
region. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation operates in three reportable business segments: Power Tools and Accessories,
Hardware and Home Improvement, and Fastening and Assembly Systems. The Power Tools and
Accessories segment has worldwide responsibility for the manufacture and sale of consumer
and professional power tools and accessories, electric cleaning and lighting products, and
lawn and garden tools, as well as for product service.</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>50</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>In addition, the Power Tools and
Accessories segment has responsibility for the sale of security hardware to customers in
Mexico, Central America, the Caribbean, and South America; for the sale of plumbing
products to customers outside the United States and Canada; and for sales of household
products. On October 2, 2004, the Corporation acquired the Porter-Cable and Delta Tools
Group from Pentair, Inc. This acquired business is included in the Power Tools and
Accessories segment. The Hardware and Home Improvement segment has worldwide
responsibility for the manufacture and sale of security hardware (except for the sale of
security hardware in Mexico, Central America, the Caribbean, and South America). On
September 30, 2003, the Corporation acquired Baldwin Hardware Corporation and Weiser Lock
Corporation. These acquired businesses are included in the Hardware and Home Improvement
segment. The Hardware and Home Improvement segment also has responsibility for the
manufacture of plumbing products and for the sale of plumbing products to customers in the
United States and Canada. The Fastening and Assembly Systems segment has worldwide
responsibility for the manufacture and sale of fastening and assembly systems. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales,
segment profit, depreciation and amortization, and capital expenditures set forth in the
following tables exclude the results of the discontinued European security hardware
business, as more fully described in Note 3. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A120></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Business Segments</B><BR>(MILLIONS OF DOLLARS) </FONT></P>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" BORDER="0">
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="12" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Reportable Business Segments</FONT><HR COLOR="#000000" SIZE="1"></TD>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Year Ended December 31, 2005</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Power<BR>
Tools &amp;<BR>
Accessories
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Hardware<BR>
&amp; Home<BR>
Improvement
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Fastening<BR>
&amp; Assembly <BR>
Systems
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Total
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Currency<BR>
Translation<BR>
Adjustments
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Corporate,<BR>
Adjustments,<BR>
&amp; Eliminations
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1>Consolidated
</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT" WIDTH="35%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,768</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="5%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   1,012</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="11%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   659</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="8%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   6,440</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="8%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   83</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="8%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &#150;</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="8%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   6,523</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit (loss) (for Consoli-</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;dated, operating income)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>635</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>143</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>95</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>873</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(72</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     813</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Depreciation and amortization</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>25</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>145</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>150</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income from equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     19</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Capital expenditures</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>79</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>107</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>111</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment assets</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(for Consolidated, total assets)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,722</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>630</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>377</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,730</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,079</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     5,816</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Investment in equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     7</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR></FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>


<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Year Ended December 31, 2004</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,796</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     963</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   617</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,377</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,398</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit (loss) (for Consoli-</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;dated, operating income)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>492</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>146</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>85</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>723</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(97</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>629</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Depreciation and amortization</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>89</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>27</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>17</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>133</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>142</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income from equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     14</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Capital expenditures</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>77</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>25</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>117</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>117</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment assets</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(for Consolidated, total assets)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,680</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>603</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>361</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,645</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>112</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,773</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     5,530</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Investment in equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     11</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR></FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Year Ended December 31, 2003</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales to unaffiliated customers</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,322</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     719</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   558</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,600</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (118</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,482</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit (loss) (for Consoli-</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;dated, operating income before</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;restructuring and exit costs)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>371</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>93</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>83</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>547</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(78</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>460</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Depreciation and amortization</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>85</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>24</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>126</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>133</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Income from equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     19</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Capital expenditures</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>73</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>17</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>105</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>102</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment assets</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(for Consolidated, total assets)</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,619</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>614</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>337</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,571</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,654</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     4,222</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Investment in equity method investees</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=24><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>51</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
profitability measure employed by the Corporation and its chief operating decision maker
for making decisions about allocating resources to segments and assessing segment
performance is segment profit (for the Corporation on a consolidated basis, operating
income before restructuring and exit costs). In general, segments follow the same
accounting policies as those described in Note 1, except with respect to foreign currency
translation and except as further indicated below. The financial statements of a
segment&#146;s operating units located outside of the United States, except those units
operating in highly inflationary economies, are generally measured using the local
currency as the functional currency. For these units located outside of the United States,
segment assets and elements of segment profit are translated using budgeted rates of
exchange. Budgeted rates of exchange are established annually and, once established, all
prior period segment data is restated to reflect the current year&#146;s budgeted rates of
exchange. The amounts included in the preceding table under the captions &#147;Reportable
Business Segments&#148;, and &#147;Corporate, Adjustments, &amp; Eliminations&#148; are
reflected at the Corporation&#146;s budgeted rates of exchange for 2005. The amounts
included in the preceding table under the caption &#147;Currency Translation
Adjustments&#148; represent the difference between consolidated amounts determined using
those budgeted rates of exchange and those determined based upon the rates of exchange
applicable under accounting principles generally accepted in the United States. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
profit excludes interest income and expense, non-operating income and expense, adjustments
to eliminate intercompany profit in inventory, and income tax expense. In addition,
segment profit excludes restructuring and exit costs. In determining segment profit,
expenses relating to pension and other postretirement benefits are based solely upon
estimated service costs. Corporate expenses, as well as certain centrally managed
expenses, are allocated to each reportable segment based upon budgeted amounts. While
sales and transfers between segments are accounted for at cost plus a reasonable profit,
the effects of intersegment sales are excluded from the computation of segment profit.
Intercompany profit in inventory is excluded from segment assets and is recognized as a
reduction of cost of goods sold by the selling segment when the related inventory is sold
to an unaffiliated customer. Because the Corporation compensates the management of its
various businesses on, among other factors, segment profit, the Corporation may elect to
record certain segment-related expense items of an unusual or non-recurring nature in
consolidation rather than reflect such items in segment profit. In addition, certain
segment-related items of income or expense may be recorded in consolidation in one period
and transferred to the various segments in a later period. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Segment
assets exclude assets of discontinued operations, pension and tax assets, intercompany
profit in inventory, intercompany receivables, and goodwill associated with the
Corporation&#146;s acquisition of Emhart Corporation in 1989. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
reconciliation of segment profit to consolidated earnings from continuing operations
before income taxes for each year, in millions of dollars, is as follows: </FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" BORDER="0">
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=1></FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>2005</B></FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>

<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment profit for total reportable business segments</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>873</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   723</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   547</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Items excluded from segment profit:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustment of budgeted foreign exchange rates to</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;actual rates</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>12</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation of Corporate property</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustment to businesses' postretirement benefit</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;expenses booked in consolidation</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(13</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other adjustments booked in consolidation directly</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;related to reportable business segments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>3</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(10</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(15</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amounts allocated to businesses in arriving at segment</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;profit in excess of (less than) Corporate center operating</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;expenses, eliminations, and other amounts identified above</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(61</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(87</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(77</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
</TR>

<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Operating income before restructuring and exit costs</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>813</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>629</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>460</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
</TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restructuring and exit costs</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>&#150;</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>31</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
</TR>


<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>813</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>629</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>428</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Interest expense, net of interest income</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>45</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.4</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>22</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other (income) expense</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
      <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(51</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6)</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Earnings from continuing operations before income taxes</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>819</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   604</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   390</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>
<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
reconciliation of segment assets to consolidated total assets at the end of each year, in
millions of dollars, is as follows: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Segment assets for total</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;reportable business segments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>3,730</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,645</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,571</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Items excluded from segment assets:</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Adjustment of budgeted foreign exchange rates</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;to actual rates</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>6</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>112</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Goodwill</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>616</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>628</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>620</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Pension assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>45</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>45</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other Corporate assets</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,418</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,099</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>991</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>5,816</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,530</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,222</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>52</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other
Corporate assets principally consist of cash and cash equivalents, tax assets, property,
assets of discontinued operations, and other assets. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales
to The Home Depot, a customer of the Power Tools and Accessories and Hardware and Home
Improvement segments, accounted for $1,393.9 million, $969.0 million, and $779.4 million
of the Corporation&#146;s consolidated sales for the years ended December 31, 2005, 2004,
and 2003, respectively. Sales to Lowe&#146;s Home Improvement Warehouse, a customer of the
Power Tools and Accessories and Hardware and Home Improvement segments, accounted for
$861.6 million, $700.1 million, and $545.3 million of the Corporation&#146;s consolidated
sales for the years ended December 31, 2005, 2004, and 2003, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
composition of the Corporation&#146;s sales by product group for each year, in millions of
dollars, is set forth below: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consumer and professional</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;power tools and product service</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>3,640</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,888</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,360</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Lawn and garden products</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>518</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>339</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>313</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consumer and professional accessories</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>458</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>379</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>348</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cleaning, lighting and household products</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>184</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>180</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>179</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Security hardware</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>745</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>730</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>526</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plumbing products</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>308</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>259</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>218</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Fastening and assembly systems</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>669</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>622</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>536</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>6,523</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,398</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,482</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation markets its products and services in over 100 countries and has manufacturing
sites in 11 countries. Other than in the United States, the Corporation does not conduct
business in any country in which its sales in that country exceed 10% of consolidated
sales. Sales are attributed to countries based on the location of customers. The
composition of the Corporation&#146;s sales to unaffiliated customers between those in the
United States and those in other locations for each year, in millions of dollars, is set
forth below: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>United States</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>4,317</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   3,442</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   2,836</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Canada</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>335</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.1</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>249</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>162</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4,652</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.9</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,692</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2,999</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Europe</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>1,350</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.2</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,266</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,107</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>520</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.6</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>439</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>376</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>6,523</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.7</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   5,398</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   4,482</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
composition of the Corporation&#146;s property, plant, and equipment between those in the
United States and those in other countries as of the end of each year, in millions of
dollars, is set forth below: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2005</FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>United States</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=16% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>328</B></FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.3</B></FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   380</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD WIDTH=15% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   340</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mexico</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>120</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.0</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>110</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>109</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other countries</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>220</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.5</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>263</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>211</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>$</B></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   <B>668</B></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>.8</B></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   754</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   660</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=12><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" --></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>

<A NAME=A121></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 19: LEASES </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation leases certain
service centers, offices, warehouses, manufacturing facilities, and equipment. Generally,
the leases carry renewal provisions and require the Corporation to pay maintenance costs.
Rental payments may be adjusted for increases in taxes and insurance above specified
amounts. Rental expense for 2005, 2004, and 2003 amounted to $99.7 million, $92.6 million,
and $85.6 million, respectively. Capital leases were immaterial in amount. Future minimum
payments under non-cancelable operating leases with initial or remaining terms of more
than one year as of December 31, 2005, in millions of dollars, were as follows: </FONT></P>


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<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=52% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2006</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=14% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=31% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    63</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2007</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>51</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2008</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2009</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>26</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2010</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Thereafter</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   216</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD></TR>
<TR>
     <TD COLSPAN=6><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>53</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A122></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 20: RESTRUCTURING
ACTIONS </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>A summary of restructuring activity
during the three years ended December 31, 2005, in millions of dollars, is set forth
below: </FONT></P>


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<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SEVERANCE<BR>BENEFITS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WRITE-DOWN<BR>TO FAIR VALUE<BR>LESS COSTS<BR>TO SELL<BR>
OF CERTAIN<BR>LONG-LIVED<BR>ASSETS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>OTHER<BR>CHARGES</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TOTAL</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT" WIDTH="35%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restructuring reserve at December 31, 2002</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="13%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   41</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="16%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="13%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   14</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD>
     <TD ALIGN="RIGHT" WIDTH="13%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   56</FONT></TD>
        <TD ALIGN="LEFT" WIDTH="1%"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reserves established in 2003</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>34</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reversal of reserves</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(7</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds received in excess of the adjusted</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp; carrying value of long-lived assets</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Utilization of reserves:</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Cash</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(27</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(13</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Non-cash</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Foreign currency translation</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restructuring reserve at December 31, 2003</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>43</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reserves established in 2004</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reversal of reserves</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Proceeds received in excess of the adjusted</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp; carrying value of long-lived assets</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Utilization of reserves:</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Cash</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(24</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.9)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(25</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Non-cash</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Foreign currency translation</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restructuring reserve at December 31, 2004</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>19</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Utilization of reserves:</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;Cash</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(13</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(13</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.6)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Foreign currency translation</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1)</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Restructuring reserve at December 31, 2005</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#150;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, the Corporation recognized $5.4 million of pre-tax restructuring and exit costs
related to actions taken in its Power Tools and Accessories segment. The restructuring
actions taken in 2004 principally reflected severance benefits. The $5.4 million charge
recognized during 2004 was offset, however, by the reversal of $4.0 million of severance
accruals established as part of previously provided restructuring reserves that were no
longer required and $1.4 million representing the excess of proceeds received on the sale
of long-lived assets, written down as part of restructuring actions, over their adjusted
carrying values. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2003, the Corporation commenced the final phase of its restructuring plan that was
formulated in the fourth quarter of 2001 and recorded a pre-tax restructuring charge of
$20.6 million. That $20.6 million charge was net of $9.6 million of reversals of
previously provided restructuring reserves that were no longer required and $3.6 million,
representing the excess of proceeds received on the sale of long-lived assets, written
down as part of restructuring actions, over their adjusted carrying values. The $20.6
million pre-tax restructuring charge recognized in 2003 principally reflected actions
relating to the Power Tools and Accessories segment to reduce its manufacturing cost base
as well as actions to reduce selling, general, and administrative expenses through the
elimination of administrative positions, principally in Europe. In addition, during the
fourth quarter of 2003 the Corporation recorded a pre-tax restructuring charge of $11.0
million associated with the closure of a manufacturing facility in its Hardware and Home
Improvement segment as a result of the acquisition of Baldwin and Weiser. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
principal component of the 2003 restructuring charge related to the elimination of
manufacturing positions, primarily in high-cost locations, and of certain administrative
positions. As a result, a severance benefit accrual of $34.3 million, principally related
to the Power Tools and Accessories segment in North America and Europe ($23.0 million) and
the Hardware and Home Improvement segment in North America ($11.3 million), was included
in the restructuring charge. The 2003 restructuring actions also resulted in the closure
of two manufacturing facilities, transferring production to low-cost facilities, and
outsourcing certain manufactured items. As a result, the 2003 restructuring charge also
included a $9.3 million write-down to fair value &#150; less, if applicable, cost to sell
&#150; of certain long-lived assets. The write-down to fair value was comprised of $6.7
million related to the Power Tools and Accessories segment in North America and Europe and
$2.6 million related to the Hardware and Home Improvement segment in North America. The
balance of the 2003 restructuring charge, or $1.2 million, related to the accrual of
future expenditures, principally consisting of lease obligations, for which no future
benefit would be realized. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>54</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
severance benefit accrual, included in the $31.6 million pre-tax restructuring charge
taken in 2003 related to the elimination of approximately 1,700 positions in high-cost
manufacturing locations and in certain administrative positions. The Corporation estimates
that, as a result of increases in manufacturing employee headcount in low-cost locations,
approximately 1,300 replacement positions were filled, yielding a net total of 400
positions eliminated as a result of the 2003 restructuring actions. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2005, 2004, and 2003, the Corporation paid severance and other exit costs of $13.6
million, $25.0 million, and $40.4 million, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Of
the remaining $6.5 million restructuring accrual at December 31, 2005, the Corporation
anticipates that these actions will be completed in 2006. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
amounts reflected in the column titled write-down to fair value less costs to sell of
certain long-lived assets, as included within this Note, relating to reserves established
during the three years ended December 31, 2005, represent adjustments to the carrying
value of those long-lived assets. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of December 31, 2005, the carrying value of facilities to be exited as part of the
Corporation&#146;s restructuring actions was not significant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A124></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 21: OTHER (INCOME)
EXPENSE </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Other (income) expense was $(51.6)
million in 2005, $2.8 million in 2004, and $2.6 million in 2003. During 2005, the
Corporation received a payment of $55.0 million relating to the settlement of
environmental and product liability coverage litigation with an insurer. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A125></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 22: LITIGATION AND
CONTINGENT LIABILITIES </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation is involved in
various lawsuits in the ordinary course of business. These lawsuits primarily involve
claims for damages arising out of the use of the Corporation&#146;s products and
allegations of patent and trademark infringement. The Corporation also is involved in
litigation and administrative proceedings relating to employment matters and commercial
disputes. Some of these lawsuits include claims for punitive as well as compensatory
damages. Using current product sales data and historical trends, the Corporation
actuarially calculates the estimate of its current exposure for product liability. The
Corporation is insured for product liability claims for amounts in excess of established
deductibles and accrues for the estimated liability up to the limits of the deductibles.
The Corporation accrues for all other claims and lawsuits on a case-by-case basis. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation also is party to litigation and administrative proceedings with respect to
claims involving the discharge of hazardous substances into the environment. Some of these
assert claims for damages and liability for remedial investigations and clean-up costs
with respect to sites that have never been owned or operated by the Corporation but at
which the Corporation has been identified as a potentially responsible party under federal
and state environmental laws and regulations. Other matters involve current and former
manufacturing facilities. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
EPA and the Santa Ana Regional Water Quality Board (the &#147;Water Quality Board&#148;)
have each initiated administrative proceedings against the Corporation and certain of the
Corporation&#146;s current or former affiliates alleging that the Corporation and numerous
other defendants are responsible to investigate and remediate alleged groundwater
contamination in and adjacent to a 160-acre property located in Rialto, California. The
cities of Colton and Rialto, as well as the West Valley Water District and the Fontana
Water Company, a private company, also have initiated lawsuits against the Corporation and
certain of the Corporation&#146;s former or current affiliates in the Federal District
Court for California, Central District alleging similar claims that the Corporation is
liable under CERCLA, the Resource Conservation and Recovery Act, and state law
for the discharge or release of hazardous substances into the environment and
the contamination caused by those alleged releases. All defendants have cross-claims
against one another in the federal litigation. The administrative proceedings and the
lawsuits generally allege that West Coast Loading Corporation (&#147;WCLC&#148;), a
defunct company that operated in Rialto between 1952 and 1957, and an as yet undefined
number of other defendants are responsible for the release of perchlorate and solvents
into the groundwater basin that supplies drinking water to the referenced three municipal
water suppliers and one private water company in California and that the Corporation and
certain of the Corporation&#146;s current or former affiliates are liable as a
&#147;successor&#148; of WCLC. The Corporation believes that neither the facts nor the law
support an allegation that the Corporation is responsible for the contamination and is
vigorously contesting these claims. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>55</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
sites never operated by the Corporation, the Corporation makes an assessment of the costs
involved based on environmental studies, prior experience at similar sites, and the
experience of other named parties. The Corporation also considers the ability of other
parties to share costs, the percentage of the Corporation&#146;s exposure relative to all
other parties, and the effects of inflation on these estimated costs. For matters
associated with properties currently operated by the Corporation, the Corporation makes an
assessment as to whether an investigation and remediation would be required under
applicable federal and state laws. For matters associated with properties previously sold
or operated by the Corporation, the Corporation considers any applicable terms of sale and
applicable federal and state laws to determine if it has any remaining liability. If it is
determined that the Corporation has potential liability for properties currently owned or
previously sold, an estimate is made of the total costs of investigation and remediation
and other potential costs associated with the site. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of December 31, 2005, the Corporation&#146;s aggregate probable exposure with respect to
environmental liabilities, for which accruals have been established in the consolidated
financial statements, was $69.9 million. These accruals are reflected in other current
liabilities and other long-term liabilities in the Consolidated Balance Sheet. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
October 27, 2003, the Corporation received notices of proposed adjustments from the United
States Internal Revenue Service (IRS) in connection with audits of the tax years 1998
through 2000. The principal adjustment proposed by the IRS consists of the disallowance of
a capital loss deduction taken in the Corporation&#146;s tax returns and interest on the
deficiency. Prior to receiving the notices of proposed adjustments from the IRS, the
Corporation filed a petition against the IRS in the Federal District Court of Maryland
(the Court) seeking refunds for a carryback of a portion of the aforementioned capital
loss deduction. The IRS subsequently filed a counterclaim to the Corporation&#146;s
petition. In October 2004, the Court granted the Corporation&#146;s motion for summary
judgment on its complaint against the IRS and dismissed the IRS counter-claim. In its
opinion, the Court ruled in the Corporation&#146;s favor that the capital losses cannot be
disallowed by the IRS. In December 2004, the IRS appealed the Court&#146;s decision in
favor of the Corporation to the United States Circuit Court of Appeals for the Fourth
Circuit (the Fourth Circuit). In February 2006, the Fourth Circuit issued its decision,
deciding two of three issues in the Corporation&#146;s favor and remanding the third issue
for trial in the Court. The Corporation intends to vigorously dispute the position taken
by the IRS in this matter. The Corporation has provided adequate reserves in the event
that the IRS prevails in its disallowance of the previously described capital loss and the
imposition of related interest. Should the IRS prevail in its disallowance of the capital
loss deduction and imposition of related interest, it would result in a cash outflow by
the Corporation of approximately $160 million. If the Corporation prevails, it would
result in the Corporation receiving a refund of taxes previously paid of approximately $50
million, plus interest. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation&#146;s estimate of the costs associated with product liability claims,
environmental exposures, income tax matters, and other legal proceedings is accrued if, in
management&#146;s judgment, the likelihood of a loss is probable and the amount of the
loss can be reasonably estimated. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
accrued liabilities are not discounted. Insurance recoveries for environmental and certain
general liability claims have not been recognized until realized. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the opinion of management, amounts accrued for exposures relating to product liability
claims, environmental matters, income tax matters, and other legal proceedings are
adequate and, accordingly, the ultimate resolution of these matters is not expected to
have a material adverse effect on the Corporation&#146;s consolidated financial
statements. As of December 31, 2005, the Corporation had no known probable but inestimable
exposures relating to product liability claims, environmental matters, income tax matters,
or other legal proceedings that are expected to have a material adverse effect on the
Corporation. There can be no assurance, however, that unanticipated events will not
require the Corporation to increase the amount it has accrued for any matter or accrue for
a matter that has not been previously accrued because it was not considered probable.
While it is possible that the increase or establishment of an accrual could have a
material adverse effect on the financial results for any particular fiscal quarter or
year, in the opinion of management there exists no known potential exposure that would
have a material adverse effect on the financial condition or on the financial results of
the Corporation beyond any such fiscal quarter or year. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>56</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A126></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>NOTE 23: QUARTERLY
RESULTS (UNAUDITED) </B></FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(DOLLARS IN MILLIONS EXCEPT PER SHARE DATA) <BR>YEAR ENDED DECEMBER 31, 2005
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FIRST<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECOND<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THIRD<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FOURTH<BR>QUARTER</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=60% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,519.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,698.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,575.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,730.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Gross margin</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>535.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>599.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>562.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>620.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>147.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>154.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>140.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>101.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>148.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>154.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>140.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>100.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations per common share - basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        1.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings per common share&#151;basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations per common share - diluted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>        1.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings per common share&#151;diluted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.8</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.7</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
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     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>YEAR ENDED DECEMBER 31, 2004
</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FIRST<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECOND<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THIRD<BR>QUARTER</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FOURTH<BR>QUARTER</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=60% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Sales</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,092.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,297.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,282.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    1,725.</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Gross margin</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>402.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>487.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>473.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>601.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>74.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>121.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>111.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>133.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>86.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>121.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>112.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>135.</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations per common share - basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> .9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings per common share&#151;basic</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings from continuing operations per common share - diluted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> .9</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Net earnings per common share&#151;diluted</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.6</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD></TR>
<TR>
     <TD COLSPAN=15><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 21, net earnings for the first quarter of 2005 included a
$55.0 million ($35.8 million after-tax) favorable settlement of environmental and product
liability coverage litigation with an insurer. As more fully described in Note 3, net
earnings for the fourth quarter of 2005 included a $.1 million loss on the sale of
discontinued operations. As more fully described in Note 12, net earnings for the fourth
quarter of 2005 included $51.2 million of incremental tax expense resulting from the
repatriation of $888.3 million foreign earnings associated with the AJCA. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
more fully described in Note 3, net earnings for the first quarter of 2004 included an
$11.7 million net gain on the sale of discontinued operations. Net earnings for the third
quarter of 2004 included a $1.0 million gain on the sale of discontinued operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Earnings
per common share are computed independently for each of the quarters presented. Therefore,
the sum of the quarters may not be equal to the full year earnings per share. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>57</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A127></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>REPORT OF INDEPENDENT REGISTERED PUBLIC</B> <BR>
<B>ACCOUNTING FIRM ON CONSOLIDATED FINANCIAL STATEMENTS</B><BR></FONT><FONT FACE="Times New Roman, Times, Serif" SIZE=1>
<B>TO THE STOCKHOLDERS AND BOARD OF DIRECTORS<BR>OF THE BLACK &amp;
DECKER CORPORATION:</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>We have audited the accompanying
consolidated balance sheet of The Black &amp; Decker Corporation and Subsidiaries as of
December 31, 2005 and 2004, and the related consolidated statements of earnings,
stockholders&#146; equity, and cash flows for each of the three years in the period ended
December 31, 2005. Our audits also included the financial statement schedule listed in the
Index at Item 15(a). These financial statements and schedule are the responsibility of the
Corporation&#146;s management. Our responsibility is to express an opinion on these
financial statements and schedule based on our audits. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
conducted our audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing
the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
our opinion, the consolidated financial statements referred to above present fairly, in
all material respects, the consolidated financial position of The Black &amp; Decker
Corporation and Subsidiaries at December 31, 2005 and 2004, and the consolidated results
of their operations and their cash flows for each of the three years in the period ended
December 31, 2005, in conformity with U.S. generally accepted accounting principles. Also,
in our opinion, the related financial statement schedule, when considered in relation to
the basic financial statements taken as a whole, presents fairly in all material respects
the information set forth therein. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
also have audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the effectiveness of The Black &amp; Decker Corporation
and Subsidiaries&#146; internal control over financial reporting as of December 31, 2005,
based on criteria established in Internal Control &#150; Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission and our report dated
February 14, 2006 expressed an unqualified opinion thereon. </FONT></P>



<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ ERNST&amp; YOUNG LLP</U>  </FONT></P>



<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Baltimore, Maryland<BR>February 14, 2006 </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>58</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A130></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Not applicable. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 9A.  CONTROLS AND PROCEDURES</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A131></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EVALUATION OF DISCLOSURE
CONTROLS AND PROCEDURES </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Under the supervision and with the
participation of Corporation&#146;s management, including the Chief Executive Officer and
Chief Financial Officer, the Corporation evaluated the effectiveness of the design and
operation of the Corporation&#146;s disclosure controls and procedures as of December 31,
2005. Based upon that evaluation, the Corporation&#146;s Chief Executive Officer and Chief
Financial Officer concluded that the Corporation&#146;s disclosure controls and procedures
are effective. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A132></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>MANAGEMENT&#146;S REPORT
ON INTERNAL CONTROL OVER FINANCIAL REPORTING</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation&#146;s management is
responsible for establishing and maintaining adequate internal control over financial
reporting. Under the supervision and with the participation of Corporation&#146;s
management, including the Chief Executive Officer and Chief Financial Officer, the
Corporation evaluated the effectiveness of the design and operation of its internal
control over financial reporting based on the framework in <I>Internal Control &#150;
Integrated Framework</I> issued by the Committee of Sponsoring Organizations of the
Treadway Commission. Based on that evaluation, the Corporation&#146;s Chief Executive
Officer and Chief Financial Officer concluded that the Corporation&#146;s internal control
over financial reporting was effective as of December 31, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ernst
&amp; Young LLP, the Corporation&#146;s independent registered public accounting firm,
audited management&#146;s assessment of the effectiveness of internal control over
financial reporting and, based on that audit, issued the report set forth on the following
page. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A133></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>CHANGES IN INTERNAL
CONTROL OVER FINANCIAL REPORTING</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>During the year ended December 31,
2005, the Corporation implemented the general ledger and sales components of the
enterprise resource planning system utilized by the majority of the Power Tools and
Accessories segment at the North American Porter-Cable and Delta Tools Group locations,
which were previously excluded from management&#146;s evaluation of the effectiveness of
its internal control over financial reporting. In conjunction with this implementation,
the Corporation&#146;s management evaluated the effectiveness of the design of internal
controls over financial reporting for this system. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
were no other changes in the Corporation&#146;s internal controls over financial reporting
during the quarterly period ended December 31, 2005, that have materially affected, or are
reasonably likely to materially affect, the Corporation&#146;s internal control over
financial reporting. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>59</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A134></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>REPORT OF INDEPENDENT
REGISTERED PUBLIC<BR>ACCOUNTING FIRM ON
INTERNAL CONTROL OVER FINANCIAL REPORTING<BR></B></FONT><FONT FACE="Times New Roman, Times, Serif" SIZE=1><B>TO THE STOCKHOLDERS AND
BOARD OF DIRECTORS<BR>OF THE BLACK &amp;
DECKER CORPORATION:</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>We have audited management&#146;s
assessment, included in Management&#146;s Report on Internal Control Over Financial
Reporting, that The Black &amp; Decker Corporation maintained effective internal control
over financial reporting as of December 31, 2005, based on criteria established in
Internal Control&#151;Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (the COSO criteria). The Black &amp; Decker
Corporation&#146;s management is responsible for maintaining effective internal control
over financial reporting and for its assessment of the effectiveness of internal control
over financial reporting. Our responsibility is to express an opinion on management&#146;s
assessment and an opinion on the effectiveness of the company&#146;s internal control over
financial reporting based on our audit. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
conducted our audit in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over
financial reporting was maintained in all material respects. Our audit included obtaining
an understanding of internal control over financial reporting, evaluating
management&#146;s assessment, testing and evaluating the design and operating
effectiveness of internal control, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for
our opinion. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
company&#146;s internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally accepted
accounting principles. A company&#146;s internal control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (2) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the company&#146;s assets that could have
a material effect on the financial statements. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Because
of its inherent limitations, internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may
deteriorate. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
our opinion, management&#146;s assessment that The Black &amp; Decker Corporation
maintained effective internal control over financial reporting as of December 31, 2005, is
fairly stated, in all material respects, based on the COSO criteria. Also, in our opinion,
The Black &amp; Decker Corporation maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2005, based on the COSO
criteria. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have also audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the consolidated balance sheet of The Black &amp; Decker
Corporation and Subsidiaries as of December 31, 2005 and 2004, and the related
consolidated statements of earnings, stockholders&#146; equity, and cash flows for each of
the three years in the period ended December 31, 2005, and our report dated February 14,
2006 expressed an unqualified opinion thereon. </FONT></P>


<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ ERNST &amp; YOUNG LLP</U> </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A138></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Baltimore, Maryland<BR>February 14, 2006 </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>60</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 9B. OTHER INFORMATION</B></FONT></P>
<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>On February 9, 2006, the
Corporation&#146;s Board of Directors approved an amended and restated employment
agreement between the Corporation and Nolan D. Archibald, the Corporation&#146;s chairman,
president and chief executive officer. A copy of the employment agreement has been filed as an exhibit to
this Annual Report on Form 10-K and is incorporated by reference into the following
description. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
employment agreement currently provides for an annual salary for Mr. Archibald of
$1,500,000, his continued participation in all compensation and benefit plans, and the
payment of benefits if the Corporation terminates Mr. Archibald&#146;s employment without
cause or Mr. Archibald terminates his employment for good reason. Under the employment
agreement, Mr. Archibald has the right to terminate his employment for good reason upon
the occurrence of the following events: (1) failure of the Corporation to perform its
obligations under the employment agreement; (2) assignment to Mr. Archibald of any duties
inconsistent with his current status as Chairman, President and Chief Executive Officer;
(3) upon the occurrence of a change in control (as defined in the employment agreement),
Mr. Archibald is not the Chairman, President and Chief Executive Officer of the successor
entity; (4) reduction in Mr. Archibald&#146;s annual base salary; (5) failure by the
Corporation to continue any compensation plan in which Mr. Archibald participates; or (6)
failure by the Corporation to continue any material benefit provided to Mr. Archibald. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
the termination of Mr. Archibald&#146;s employment by the Corporation without cause or by
Mr. Archibald with good reason, Mr. Archibald would be entitled to the following benefits:
(1) a severance payment equal to (A) three times the sum of Mr. Archibald&#146;s annual
base salary and the &#147;EAIP maximum payment&#148; plus (B) the &#147;PEP maximum
payment;&#148; (2) Mr. Archibald will fully vest in all outstanding stock options, and all
shares of restricted stock will become fully vested and no longer subject to forfeiture;
(3) reimbursement of all legal fees and expenses incurred by Mr. Archibald as a result of
his termination; and (4) life, disability, accident and health insurance benefits for
three years following termination substantially similar to those benefits to which Mr.
Archibald was entitled immediately prior to termination. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of the employment agreement, &#147;EAIP maximum payment&#148; means the maximum
payment that Mr. Archibald could have received under The Black &amp; Decker Executive
Annual Incentive Plan, determined as if Mr. Archibald had remained a participant and all
performance goals that would have entitled Mr. Archibald to a maximum payment are met or
exceeded. &#147;PEP maximum payment&#148; equals the sum of (1) the value of 150% of the
performance shares that are forfeited by Mr. Archibald pursuant to The Black &amp; Decker
Performance Equity Plan (&#147;PEP&#148;) plus (2) 150% of the product of (a) Mr.
Archibald&#146;s annual base salary multiplied by (b) the percentage target used to
calculate the number of performance shares awarded to Mr. Archibald under the PEP. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
the occurrence of a change in control, Mr. Archibald will fully vest in all outstanding
stock options, and, under the terms of The Black &amp; Decker Restricted Stock Plan (the
&#147;RSP&#148;) and the PEP, respectively, all shares of restricted stock previously
awarded to Mr. Archibald will become fully vested and no longer subject to forfeiture, and
Mr. Archibald will receive the maximum number of performance shares held by him (150% of
the target award for each performance period) under the PEP. In connection with a change
in control, Mr. Archibald will be entitled to a gross-up payment if he is subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
Mr. Archibald notifies the Compensation Committee of the Board of Directors of his
expected retirement date, the employment agreement requires the Compensation Committee to
establish a vesting schedule with respect to all subsequent awards of stock options and
restricted stock that ensures that those stock options and shares of restricted stock will
vest on or before Mr. Archibald&#146;s expected retirement date. On a date that is 18
months following Mr. Archibald&#146;s retirement, the Corporation will pay Mr. Archibald
an amount equal to 150% of any performance shares that Mr. Archibald forfeits under the
PEP. For purposes of calculating this payment, the value of each performance share will be
the closing price per share of the Corporation&#146;s common stock on the New York Stock
Exchange on or nearest to Mr. Archibald&#146;s retirement date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
February 9, 2006, the Corporation&#146;s Board of Directors also approved a revised form
of severance benefits agreements between the Corporation and certain key executives, other
than Mr. Archibald. A copy of the form of severance
benefits agreement has been filed as an exhibit to this Annual Report on Form 10-K and is incorporated by
reference into the following description. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
severance benefits agreements provide for the payment of specified benefits if employment
terminates under certain circumstances following a change in control. A change in control
is deemed to take place whenever: (1) a person, group of persons, or other entity becomes
the beneficial owner of securities of the Corporation having 20% or more of the combined
voting power of the Corporation&#146;s then-outstanding securities; (2) a significant
change in the composition of the Corporation&#146;s Board of Directors occurs; (3) the
Corporation enters into an agreement that would result in a change of control; or (4) the
stockholders of the Corporation approve certain types of extraordinary transactions.</FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>61</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
severance benefits agreements provide that each executive will fully vest in all
outstanding stock options held by the executive upon the occurrence of a change in
control. Upon the occurrence of a change in control, all shares of restricted stock
previously awarded to the executive will become fully vested and no longer subject to
forfeiture under the terms of the RSP, and the executive will receive the maximum number
of performance shares held by him or her (150% of the target award for each performance
period) under the terms of the PEP. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Circumstances
triggering payment of severance benefits under these agreements include: (1) involuntary
termination of employment for reasons other than death, disability, or cause; or (2)
voluntary termination by the executive in the event of significant changes in the nature
of his or her employment, including reductions in compensation and changes in
responsibilities and powers. Benefits under the severance benefits agreements generally
include (1) a severance payment equal to (A) three times the sum of the executive&#146;s
annual base salary and the &#147;maximum participant award&#148; plus (B) 150% of
the product of (X) the executive&#146;s annual base salary multiplied by (Y) the
percentage target used to calculate the number of performance shares most recently awarded to the
executive under the PEP; (2) reimbursement of all legal fees and expenses incurred by the
executive as a result of his or her termination; (3) a gross-up payment if the executive is
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code; and (4)
life, disability, accident and health insurance benefits for three years following
termination substantially similar to those benefits to which the executive was entitled
immediately prior to termination. For purposes of the severance benefits agreement, the
&#147;maximum participant award&#148; means the maximum payment that the executive could
have received under the applicable annual incentive plan, determined as if the executive
had remained a participant and all performance goals that would have entitled the
executive to a maximum payment are met or exceeded. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>62</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A139></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=4><B>PART III</B> </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT</B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
with respect to Directors is contained in the Corporation&#146;s Proxy Statement for the
Annual Meeting of Stockholders to be held April 20, 2006, under the captions
&#147;Election of Directors&#148;, &#147;Board of Directors&#148;, and &#147;Section 16(a)
Beneficial Ownership Reporting Compliance&#148; and is incorporated herein by reference. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Information
required under this Item with respect to Executive Officers of the Corporation is included
in Item 1 of Part I of this report. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 11. EXECUTIVE COMPENSATION</B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
is contained in the Corporation&#146;s Proxy Statement for the Annual Meeting of
Stockholders to be held April 20, 2006, under the captions &#147;Board of Directors&#148;
and &#147;Executive Compensation&#148; and is incorporated herein by reference. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS</B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
is contained in the Corporation&#146;s Proxy Statement for the Annual Meeting of
Stockholders to be held April 20, 2006, under the captions &#147;Voting Securities&#148;,
&#147;Security Ownership of Management&#148;, and &#147;Equity Compensation Plan
Information&#148; and is incorporated herein by reference. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS</B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
is contained in the Corporation&#146;s Proxy Statement for the Annual Meeting of
Stockholders to be held April 20, 2006, under the caption &#147;Executive
Compensation&#148; and is incorporated herein by reference. </FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES</B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Information required under this Item
is contained in the Corporation&#146;s Proxy Statement of the Annual Meeting of
Stockholders to be held April 20, 2006, under the caption &#147;Ratification of the
Selection of the Independent Registered Public Accounting Firm&#148; and is incorporated
herein by reference. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>63</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<A NAME=A140></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=4><B>PART IV </B></FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES</B></FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(a)&nbsp;&nbsp;&nbsp;&nbsp;
          List of Financial Statements, Financial Statement Schedules, and Exhibits </B></FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(1)&nbsp;&nbsp;&nbsp;&nbsp;
          LIST OF FINANCIAL STATEMENTS</B><BR> The following consolidated financial statements of
          the Corporation and its subsidiaries are included in Item 8 of Part II of this
          report: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
Statement of Earnings &#150; years ended December 31, 2005, 2004, and 2003.<BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
Balance Sheet &#150; December 31, 2005 and 2004.<BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated Statement of
Stockholders&#146; Equity &#150; years ended December 31, 2005, 2004, and 2003.<BR><BR> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consolidated
Statement of Cash Flows &#150; years ended December 31, 2005, 2004, and 2003.<BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes
to Consolidated Financial Statements.<BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Report
of Independent Registered Public Accounting Firm on Consolidated Financial Statements.</FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          LIST OF FINANCIAL STATEMENT SCHEDULES</B><BR> The following financial statement
          schedules of the Corporation and its subsidiaries are included herein: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Schedule
II &#150; Valuation and Qualifying Accounts and Reserves.<BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
other schedules for which provision is made in the applicable accounting regulations of
the Commission are not required under the related instructions or are inapplicable and,
therefore, have been omitted. </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          LIST OF EXHIBITS</B><BR> The following exhibits are either included in this report or
          incorporated herein by reference as indicated below: </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 2</B><BR>Purchase Agreement between the
Corporation and Pentair, Inc. dated as of July 16, 2004, included in the
Corporation&#146;s Quarterly Report on Form 10-Q for the quarter ended June 27, 2004, is
incorporated herein by reference. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 3(a)</B><BR>Articles of Restatement of the
Charter of the Corporation, included in the Corporation&#146;s Quarterly Report on Form
10-Q for the quarter ended June 29, 1997, are incorporated herein by reference. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 3(b)</B><BR>Bylaws of the Corporation, as
amended, included in the Corporation&#146;s Current Report on Form 8-K filed with the
Commission on April 28, 2005, are incorporated herein by reference. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(a)</B><BR>Indenture dated as of March 24, 1993,
by and between the Corporation and Security Trust Company, National Association, as
Trustee, included in the Corporation&#146;s Current Report on Form 8-K filed with the
Commission on March 26, 1993, is incorporated herein by reference. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(b)</B><BR>Indenture dated as of June 26, 1998,
by and among Black &amp; Decker Holdings Inc., as Issuer, the Corporation, as Guarantor,
and The First National Bank of Chicago, as Trustee, included in the Corporation&#146;s
Quarterly Report on Form 10-Q for the quarter ended June 28, 1998, is incorporated herein
by reference. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(c)</B><BR>Credit Agreement, dated as of April
2, 2001, among the Corporation, Black &amp; Decker Holdings, Inc., as Initial Borrowers,
the initial lenders named therein, as Initial Lenders, Citibank, N.A., as Administrative
Agent, JPMorgan, a division of Chase Securities Inc., as Syndication Agent, and Bank of
America, N.A. and Commerzbank AG, as Co-Syndication Agents, included in the
Corporation&#146;s Quarterly Report on Form 10-Q for the quarter ended July 1, 2001, is
incorporated herein by reference. </FONT></P>

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<A NAME=A148></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(d)</B><BR>
Indenture  between the  Corporation  and The Bank of New York,  as Trustee,  dated as of June 5, 2001,  included in the  Corporation's
Registration Statement on Form S-4 (Reg. No. 333-64790), is incorporated herein by reference.</FONT></P>

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<A NAME=A149></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(e)</B><BR>
Form of 7.125%  Senior Note Due 2011,  included in the  Corporation's  Registration  Statement on Form S-4 (Reg.  No.  333-64790),  is
incorporated herein by reference. </FONT></P>

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<A NAME=A150></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(f)</B><BR>
Indenture, dated as of October 18,
2004, between the Corporation and The Bank of New York, as Trustee, included in the
Corporation&#146;s Current Report on Form 8-K filed with the Commission on October 20,
2004, is incorporated herein by reference. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>64</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A151></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 4(g)</B><BR>Form of 4&frac34;% Senior Note due
2014 (included in Exhibit 4.1), included in the Corporation&#146;s Current Report on Form
8-K filed with the Commission on October 20, 2004, is incorporated herein by reference. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Corporation agrees to furnish a
copy of any other documents with respect to long-term debt instruments of the Corporation
and its subsidiaries upon request. </FONT></P>

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<A NAME=A152></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(a)</B><BR>The Black &amp; Decker Corporation
Deferred Compensation Plan for Non-Employee Directors. </FONT></P>

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<A NAME=A153></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(b)</B><BR>The Black &amp; Decker Non-Employee
Directors Stock Plan, as amended and restated. </FONT></P>

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<A NAME=A154></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(c)</B><BR>The Black &amp; Decker 1989 Stock
Option Plan, as amended, included in the Corporation&#146;s Quarterly Report on Form 10-Q
for the quarter ended March 30, 1997, is incorporated herein by reference. </FONT></P>

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<A NAME=A155></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(d)</B><BR>The Black &amp; Decker 1992 Stock
Option Plan, as amended. </FONT></P>

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<A NAME=A156></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(e)</B><BR>The Black &amp; Decker 1995 Stock Option
Plan for Non-Employee Directors, as amended, included in the Corporation&#146;s Annual
Report on Form 10-K for the year ended December 31, 1998, is incorporated herein by
reference. </FONT></P>

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<A NAME=A157></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(f)</B><BR>The Black &amp; Decker 1996 Stock
Option Plan, as amended. </FONT></P>

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<A NAME=A158></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(g)</B><BR>The Black &amp; Decker 2003 Stock Option
Plan, as amended. </FONT></P>

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<A NAME=A159></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(h)</B><BR>The Black &amp; Decker Corporation
2004 Restricted Stock Plan, included as Exhibit B to the Proxy Statement, dated March 16,
2004, for the 2004 Annual Meeting of Stockholders of the Registrant, is incorporated
herein by reference. </FONT></P>

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<A NAME=A160></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(i)</B><BR>The Black &amp; Decker Performance
Equity Plan, as amended. </FONT></P>

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<A NAME=A161></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(j)</B><BR>Form of Restricted Share Agreement relating
to The Black &amp; Decker Corporation 2004 Restricted Stock Plan, included in the
Corporation&#146;s Current Report on Form 8-K filed with the Commission on April 28, 2005,
is incorporated herein by reference. </FONT></P>

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<A NAME=A162></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(k)</B><BR>Form of Nonqualified Stock Option
Agreement with executive officers relating to the Corporation&#146;s stock option plans,
included in the Corporation&#146;s Current Report on Form 8-K filed with the Commission on
April 28, 2005, is incorporated herein by reference. </FONT></P>

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<A NAME=A163></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(l)</B><BR>The Black &amp; Decker Executive
Annual Incentive Plan, as amended and restated. </FONT></P>

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<A NAME=A164></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(m)</B><BR>The Black &amp; Decker Management
Annual Incentive Plan, as amended. </FONT></P>

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<A NAME=A165></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(n)</B><BR>The Black &amp; Decker Supplemental
Pension Plan, as amended and restated. </FONT></P>

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<A NAME=A166></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(o)(1)</B><BR>The Black &amp; Decker Supplemental Retirement
Savings Plan, as amended and restated. </FONT></P>

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<A NAME=A167></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(p)</B><BR>The Black &amp; Decker Supplemental
Executive Retirement Plan, as amended and restated. </FONT></P>

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<A NAME=A168></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(q)</B><BR>The Black &amp; Decker Executive Life
Insurance Program, as amended, included in the Corporation&#146;s Quarterly Report on Form
10-Q for the quarter ended April 4, 1993, is incorporated herein by reference. </FONT></P>

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<A NAME=A169></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(r)</B><BR>The Black &amp; Decker Executive
Salary Continuance Plan, as amended and restated. </FONT></P>

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<A NAME=A170></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(s)</B><BR>Description of the Corporation&#146;s
policy and procedures for relocation of existing employees (individual transfers),
included in the Corporation&#146;s Annual Report on Form 10-K for the year ended December
31, 1991, is incorporated herein by reference. </FONT></P>

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<A NAME=A171></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(t)</B><BR>Description of the Corporation&#146;s
policy and procedures for relocation of new employees, included in the Corporation&#146;s
Annual Report on Form 10-K for the year ended December 31, 1991, is incorporated herein by
reference. </FONT></P>

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<A NAME=A172></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(u)</B><BR>Description of certain incidental
benefits provided to executive officers of the Corporation, included in the
Corporation&#146;s Annual Report on Form 10-K for the year ended December 31, 1997, is
incorporated herein by reference. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>65</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A173></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(v)</B><BR>Form of Severance Benefits Agreement
by and between the Corporation and approximately 17 of its key employees. </FONT></P>

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<A NAME=A174></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(w)</B><BR>Amended and Restated Employment
Agreement, dated as of February 9, 2006, by and between the Corporation and Nolan D.
Archibald. </FONT></P>

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<A NAME=A175></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(x)</B><BR>Severance Benefits Agreement, dated
February 10, 2006, by and between the Corporation and John W. Schiech. </FONT></P>

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<A NAME=A176></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(y)</B><BR>Severance Benefits Agreement, dated February
10, 2006, by and between the Corporation and Charles E. Fenton. </FONT></P>

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<A NAME=A177></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(z)</B><BR>Severance Benefits Agreement, dated
February 10, 2006, by and between the Corporation and Michael D. Mangan. </FONT></P>

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<A NAME=A178></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(aa)(1)</B><BR>Special Deferral Agreement, dated
February 7, 2000, by and between the Corporation and Paul A. Gustafson, included in the
Corporation&#146;s Annual Report for the year ended December 31, 1999, is incorporated
herein by reference. </FONT></P>

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<A NAME=A179></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(aa)(2)</B><BR>Severance Benefits Agreement, dated
February 10, 2006, by and between the Corporation and Paul A. Gustafson. </FONT></P>

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<A NAME=A180></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(bb)</B><BR>Severance Benefits Agreement, dated February
10, 2006, by and between the Corporation and Thomas D. Koos. </FONT></P>

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<A NAME=A181></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 10(cc)</B><BR>The Black &amp; Decker Corporation
Corporate Governance Polices and Procedures Statement, as amended, included in the
Corporation&#146;s Current Report on Form 8-K filed with the Commission on December 15,
2004, is incorporated herein by reference. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Items 10(a) through 10(cc) constitute
management contracts and compensatory plans and arrangements required to be filed as
exhibits under Item 14(c) of this report. </FONT></P>

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<A NAME=A182></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 21</B><BR>List of
Subsidiaries. </FONT></P>

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<A NAME=A183></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 23</B><BR>Consent of Independent Registered
Public Accounting Firm. </FONT></P>

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<A NAME=A184></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 24</B><BR>Powers of
Attorney. </FONT></P>

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<A NAME=A185></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 31.1</B><BR>Chief Executive Officer&#146;s
Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. </FONT></P>

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<A NAME=A186></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 31.2</B><BR>Chief Financial Officer&#146;s
Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. </FONT></P>

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<A NAME=A187></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 32.1</B><BR>Chief Executive Officer&#146;s
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002. </FONT></P>

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<A NAME=A188></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 32.2</B><BR>Chief Financial Officer&#146;s
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
other items are &#147;not applicable&#148; or &#147;none&#148;. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>66</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<A NAME=A189></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(<B>b) Exhibits</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The exhibits required by Item 601 of
Regulation S-K are filed herewith. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(c)&nbsp;&nbsp;&nbsp;&nbsp;
          Financial Statement Schedules and Other Financial Statements</B></FONT></P>


 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Financial
          Statement Schedule required by Regulation S-X is filed herewith. </FONT></P>

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<A NAME=A190></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>SCHEDULE
II&#151;VALUATION AND QUALIFYING ACCOUNTS AND RESERVES<BR><BR>THE BLACK &amp; DECKER
CORPORATION AND SUBSIDIARIES </B><BR>(MILLIONS OF DOLLARS)</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD COLSPAN="3" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DESCRIPTION</FONT></TD>
     <TD COLSPAN="3" ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>BALANCE<BR>AT<BR>BEGINNING<BR>OF PERIOD</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ADDITIONS<BR>CHARGED TO<BR> COSTS AND<BR>EXPENSES</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DEDUCTIONS</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>OTHER<BR>CHARGES<BR>ADD<BR>(DEDUCT)</FONT></TD>
     <TD COLSPAN=3 ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>BALANCE<BR>AT END<BR>OF PERIOD</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="43%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Year Ended December 31, 2005</I></FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="9%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="9%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="9%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="9%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="9%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD WIDTH="1%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD WIDTH="1%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reserve for doubtful accounts and cash discounts</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   52</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   87</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.2</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$92 </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   (1.4)</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   45</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.1</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Year Ended December 31, 2004</I></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reserve for doubtful accounts and cash discounts</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   47</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   86</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$93 </FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.0</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   11.4&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
<TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif"SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif"SIZE=2>   52</FONT></TD>
<TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif"SIZE=2>.1</FONT></TD></TR>
<TR VALIGN=Bottom>
    <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Year Ended December 31, 2003</I></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reserve for doubtful accounts and cash discounts</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   46</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>   70</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.5</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$74</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.3</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.9&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>47</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>.4</FONT></TD></TR>
<TR>
     <TD COLSPAN=21><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)&nbsp;&nbsp;&nbsp;&nbsp;
          Accounts written off during the year and cash discounts taken by customers. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)&nbsp;&nbsp;&nbsp;&nbsp;
          Primarily includes currency translation adjustments and amounts associated with
          acquired and divested businesses. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>67</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pursuant to the requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized. </FONT></P>

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     <TD WIDTH="55%"><FONT FACE="Times New Roman" SIZE="2"><BR><BR><BR>DATE:  <U>February 14, 2006</U></FONT></TD>
     <TD WIDTH="45%"><FONT FACE="Times New Roman" SIZE="2">THE BLACK&nbsp;&nbsp;&amp;&nbsp;&nbsp;DECKER CORPORATION<BR>
<BR>
<BR>
By    <U>/s/ NOLAN D. ARCHIBALD</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman,
President, and <BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer
</FONT></TD></TR>
</TABLE>
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed below on February 14, 2006,
by the following persons on behalf of the registrant and in the capacities indicated. </FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">SIGNATURE</FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">TITLE</FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">DATE</FONT></TH></TR>
<TR>
     <TD COLSPAN=9><HR NOSHADE COLOR=#000000 SIZE=2></TD></TR>
<TR>
     <TD COLSPAN=9>&nbsp;</TD></TR>
<TR VALIGN="TOP">
     <TD WIDTH="37%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Principal Executive Officer<BR><U>/s/ NOLAN D. ARCHIBALD</U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR> Nolan D. Archibald
<BR><BR>
Principal Financial Officer<BR>
<U>/s/ MICHAEL D. MANGAN</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Michael D. Mangan <BR> <BR>
Principal Accounting Officer<BR>
<U>/s/ CHRISTINA M. MCMULLEN</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <BR>
Christina M. McMullen <BR>
<BR>

</FONT></TD>
     <TD WIDTH="38%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR><BR>Chairman, President, and Chief Executive Officer
<BR>
<BR><BR><BR>
Senior Vice President and Chief Financial Officer
<BR><BR><BR><BR>
Vice President and Controller
</FONT></TD>
     <TD WIDTH="25%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>
<U>February 14, 2006</U><BR><BR><BR><BR>
<U>February 14, 2006</U><BR><BR><BR><BR>
<U>February 14, 2006</U>
</FONT></TD></TR>
</TABLE>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>This report has been signed by the
following directors, constituting a majority of the Board of Directors, by Nolan D.
Archibald, Attorney-in-Fact. </FONT></P>


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<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;
</FONT></TD>
<TD WIDTH="35%" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Nolan D. Archibald  <BR>
Norman R. Augustine <BR>
Barbara L. Bowles   <BR>
M. Anthony Burns    <BR>
Kim B. Clark
</FONT></TD>
<TD WIDTH="5%" ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"> &nbsp;
</FONT></TD>
     <TD WIDTH="45%" ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Manuel A. Fernandez<BR>
Benjamin H. Griswold, IV<BR>
Anthony Luiso<BR>
Robert L. Ryan<BR>
Mark H. Willes
</FONT></TD></TR>
</TABLE>
<BR><BR>



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     <TH><FONT FACE="Times New Roman" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="55%"><FONT FACE="Times New Roman" SIZE="2">By    <U>/s/ NOLAN D. ARCHIBALD</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Attorney-in-Fact</FONT></TD>
     <TD WIDTH="45%"><FONT FACE="Times New Roman" SIZE="2">DATE:  <U>February
14, 2006</U></FONT></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>68</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>form10k12312005b.htm
<DESCRIPTION>EXHIBIT 10(A)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (a)</B></FONT></P>

<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
CORPORATION<BR> DEFERRED COMPENSATION PLAN<BR>FOR NON-EMPLOYEE DIRECTORS </FONT></H1>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Eligibility</U>. </B>&nbsp; </FONT></P>

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<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each
member of the Board of Directors of The Black &amp; Decker Corporation (the
&#147;Corporation&#148;) who is not an employee of the Corporation or any of the
Corporation&#146;s subsidiaries is eligible to participate in this <U>Deferred
Compensation Plan for </U> <U>Non-Employee Directors</U> (the &#147;Plan&#148;). </FONT></TD>
</TR>
</TABLE>
<BR>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U> Administration of
Plan.</U> </B>&nbsp; </FONT></P>


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<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
Plan will be administered by the Corporate Governance Committee of the Corporation&#146;s
Board of Directors (the &#147;Committee&#148;). The Committee shall have full power to
interpret and administer the Plan, and the Committee&#146;s interpretations and actions
shall be binding and conclusive on all persons for all purposes. Neither the Committee nor
any person acting on its behalf shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of the Plan unless
attributable to willful misconduct or lack of good faith. </FONT></TD>
</TR>
</TABLE>
<BR>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Participation</U>. </B>&nbsp; </FONT></P>

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          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a. </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          An eligible director may elect to defer all or any part of the compensation that
          would otherwise have been payable currently for services as a member of the
          Board of Directors (including fees payable for services as a member of a
          committee of the Board). An election must be executed and filed with the
          Secretary of the Corporation by the end of the calendar year preceding the
          calendar year the compensation will be earned. An election to defer all or any
          part of such compensation for any given calendar year will be irrevocable. A new
          director may elect to participate in the Plan by executing and filing an
          election with the Secretary of the Corporation prior to the commencement of the
          director&#146;s term of office. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>



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          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b. </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          An election shall be in writing substantially in the form attached as Exhibit A.
          &nbsp; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>c. </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          An election to participate in the Plan shall be effective from the date of the
          election and for all subsequent years until the calendar year following the year
          in which the participant files a revised election or a notice of termination. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>d<B><I>.</I></B><I></I> </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          A participant may terminate participation in the Plan by executing and filing
          with the Secretary of the Corporation a notice of termination in such form as
          prescribed by the Secretary. Any such termination shall be effective at the end
          of the calendar year in which the notice is given. In the event of termination,
          the amount already deferred under the Plan and interest or other earnings
          thereon shall be paid to the participant only as indicated in Section 6 of the
          Plan. A director who has filed a termination of election may thereafter file an
          election to participate in the Plan for any calendar year commencing after
          filing the election. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>e. </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          A participant may change an existing election as to the manner of distribution
          by filing with the Secretary of the Corporation an election form choosing any
          manner of distribution authorized by the Plan at the time the new election form
          is filed in such form as prescribed by the Secretary. A participant may also
          change the timing of distribution by filing with the Secretary of the
          Corporation an election form in such form as prescribed by the Secretary. Any
          new election form must be filed (1) prior to the termination of the
          director&#146;s service as a director and (2) at least twelve months prior to
          the date that the first distribution under both the existing election and under
          the new election would be made. Any new election must extend the deferral period
          for at least five calendar years from the date of initial</FONT></P></TD>
          </TR>
          </TABLE>
          <BR>


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          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
payment under the
          existing election. Any new election will take effect 12 months after the date it
          is filed. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Deferred Cash Compensation Account</U>. </B>&nbsp; </FONT></P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A
general ledger account, hereinafter referred to as the &#147;Deferred Compensation
Account,&#148; shall be established for the purpose of reflecting deferred compensation.
All deferred compensation otherwise payable to the participant for the calendar year to
which the election applies shall be credited to the Deferred Compensation Account,
together with interest compounded semi-annually on January 1 and July 1 at a rate equal to
the higher of the yield on the Income Fund of The Black&nbsp;&amp; Decker Corporation
Retirement Savings Plan or the T. Rowe Price Equity Index Fund during the period then
ended. Alternatively, the participant may direct that cash compensation deferred hereunder
be deemed invested in common stock of the Corporation, in which case, the
participant&#146;s Deferred Compensation Account will be initially credited with the
number of shares of common stock of the Corporation required under subsection B.7.b of the
Corporate Governance Policies and Procedures Statement and subsequently adjusted for
increases and decreases in the value of, and for dividends paid on, the common stock of
the Corporation. Title to and beneficial ownership of the Deferred Compensation Account
shall remain in the Corporation. The obligation to pay shall be a general unsecured
obligation of the Corporation, and the participating director and his designated
beneficiaries shall not have any property interest whatsoever in any specific assets of
the Corporation. The Corporation may, however, establish a &#147;Rabbi Trust&#148; for
individual participants or all participants as a group. </FONT></TD>
</TR>
</TABLE>
<BR>



<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Deferred Stock Compensation Account</U></B><U></U>. &nbsp; </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A
stock account, hereinafter referred to as the &#147;Deferred Stock Compensation
Account,&#148; shall be established for the purpose of reflecting stock compensation
deferred pursuant to Section 8 of The Black &amp; Decker Non-Employee Directors Stock Plan
(the &#147;Stock Plan&#148;). The provisions of this Plan shall apply to deferrals under
the Stock Plan except that in the event of conflict between the Plan and the Stock Plan,
the provisions of the Stock Plan shall control. </FONT></TD>
</TR>
</TABLE>
<BR>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Distribution from Plan</U>. </B>&nbsp; </FONT></P>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    All compensation deferred under the Plan, plus accumulated interest or other
                    investment adjustments, shall be distributed in a lump sum or in approximately
                    equal annual installments not exceeding ten as specified by the participant at
                    the time of making the election or in an amendment complying with the provisions
                    of Section 3.e of the Plan. Unless a participant files an election to change the
                    timing of distribution in accordance with Section 3.e of the Plan, the first
                    installment, or the lump sum distribution, shall be paid on the first day of the
                    calendar year immediately following the year in which the participant ceases to
                    be a director of the Corporation. Subsequent installments shall be paid on the
                    anniversary of the first installment in each succeeding calendar year until all
                    amounts in the participant&#146;s Deferred Compensation Account have been paid.
                    Distributions of a participant&#146;s Deferred Compensation Account shall be
                    made in cash except to the extent that the participant has directed the Deferred
                    Compensation Account be deferred as common stock of the Corporation, in which
                    case distribution shall be made in shares of common stock of the Corporation
                    under the Stock Plan. Distributions of a participant&#146;s Deferred Stock
                    Compensation Account shall be made in common stock of the Corporation under the
                    Stock Plan. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Notwithstanding the above, if a participant incurs a severe financial hardship,
                    the Committee may, in its sole discretion, revise the payment schedule to the
                    extent reasonably necessary to eliminate the severe financial hardship. The
                    severe financial hardship must have been caused by an accident or illness of the
                    director, the director&#146;s spouse or dependent (as defined in Section 152(a)
                    of the Internal Revenue Code of 1986, as amended (the &#147;Code&#148;)) of the
                    director, by loss of the director&#146;s property due to casualty, or by another
                    similar extraordinary and unforeseeable event beyond the control of the
                    participant. The Committee may pay to the participant the participant&#146;s
                    Deferred Compensation Account and Deferred Stock Compensation Account as may be
                    necessary to comply with a certificate of divestiture (as defined in Section
                    </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2></FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
1043(b)(2) of the Code). In the event a participant dies before all deferred
                    amounts are distributed, the remaining balance of the participant&#146;s
                    Deferred Compensation Account and Deferred Stock Compensation Account shall be
                    paid in a lump sum on the first day of the calendar year following the year of
                    death to the beneficiaries most recently designated by the director in writing.
                    If no beneficiaries are designated or the designated beneficiaries fail to
                    survive the participant, payment shall be made to the estate of the participant. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>



<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Rabbi Trust</U></B><U></U>. &nbsp; </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
Corporation may establish a &#147;Rabbi Trust&#148; for individual participants or all
participants as a group. With the consent of a participant, the Trustee of a &#147;Rabbi
Trust&#148; established for that participant may be directed to invest the
participant&#146;s deferred cash compensation in common stock of the Corporation, and, if
that is done, (1) neither the Corporation nor the trustee shall have any liability for any
decrease in the value of the stock held in the trust and (2) the timing of any
distribution from the trust shall be in accordance with the election made under Section 6
of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>


<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Rights.</U></B><U></U> &nbsp; </FONT></P>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
right of a participant in the Plan to any deferred compensation or interest thereon shall
not be subject to assignment, anticipation, alienation, transfer, pledge, or encumbrance
except by laws of descent and distribution. </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>No Trusts</U>. </B>&nbsp; </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Nothing
contained in the Plan and no action taken pursuant to the provisions of the Plan shall be
construed to create a trust of any kind or an escrow arrangement of any form. </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Copies of Plan</U>. </B>&nbsp; </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Copies
of the Plan and any and all amendments thereto shall be made available to all members of
the Board of Directors during normal business hours at the office of the Secretary of the
Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11.&nbsp;&nbsp;&nbsp;&nbsp;
          <B><U>Compliance.</U></B><U></U> &nbsp; </FONT></P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
It
is intended that this Plan comply with Section 409A of the Code and shall be interpreted
accordingly. Any provision of this Plan not in conformance with Section 409A of the Code
shall be treated as void as of January 1, 2005. </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2></FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A004></A>
<H1 ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=3><U>Exhibit A</U> </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<A NAME=A005></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
CORPORATION <BR>Election to Defer
Compensation </B><BR>under <BR><B>Deferred Compensation
Plan for Non-Employee Directors <BR>And Non-Employee
Directors Stock Plan</B></FONT></P>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>I acknowledge receiving a copy of the
Deferred Compensation Plan for Non-Employee Directors and the Non-Employee Directors Stock
Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pursuant to the terms of the Plans, I
elect to defer receiving the following: &nbsp; </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;____ % of cash retainers to be deferred as _____ cash or _____ stock</FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A010></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;____ % of stock retainers&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>My election will continue in effect
until the first day of the calendar year following the year in which I file written notice
of termination or of amendment of this election with the Secretary of the Corporation. My
election to defer all or part of my compensation for any given calendar year shall be
irrevocable. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>I also elect that all amounts
deferred under the Plans (including amounts previously deferred), together with
accumulated interest or other investment adjustments thereon, shall be distributed to me
in (specify number, not exceeding ten) approximately equal annual installment(s)
commencing on first day of the calendar year immediately following the calendar year in
which I cease to be a director of the Corporation, and subsequent installments shall be
paid on the anniversary of the first installment in each succeeding calendar year until
the entire amount credited to my account shall have been paid. </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>If I die prior to distribution of the
entire amount, I direct that the remaining amount be paid in a lump sum to: &nbsp; </FONT></P>






<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;________________________________<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(name)</FONT></TD>
<TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
<TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">________________________________<BR>(relationship)</FONT></TD></TR>
</TABLE>

<BR>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;_____________________________________________________________________________________________<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(street address)</FONT></TD></TR>
<TR VALIGN="TOP">
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD></TR>
<TR VALIGN="TOP">
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;_____________________________________________________________________________________________<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (city, state, zip code)</FONT></TD></TR>
</TABLE>




<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>I understand that my ability to elect to
defer these payments and specify their date of distribution under this Plan is conditioned
on compliance with the Internal Revenue Code, as amended by the American Jobs Creation Act
of 2004. If it is determined that either the Plan or this election is not in compliance
with the Internal Revenue Code or IRS Regulations, I understand that this election may be
cancelled and the deferred amounts returned to me as taxable income. </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">________________________________<BR>(dated)</FONT></TD>
<TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
<TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">________________________________<BR>(signature)<BR><BR>________________________________<BR>(printed name)</FONT></TD></TR>
</TABLE>

<HR SIZE=2 NOSHADE>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>FOR CORPORATION'S USE</U></B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">________________________________<BR>Date Received</FONT></TD>
<TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
<TD WIDTH="40%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">________________________________<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporate Secretary</FONT></TD></TR>
</TABLE>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-4-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>form10k12312005c.htm
<DESCRIPTION>EXHIBIT 10(B)
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>
<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (b)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>The Black &amp; Decker
Non-Employee Directors Stock Plan</U> </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Purpose of the Plan</U>. Under this Non-Employee Directors Stock Plan of The
          Black &amp; Decker Corporation, a Maryland corporation (the
          &#147;Company&#148;), shares of the Company&#146;s Common Stock, par value $.50
          per share (&#147;Common Stock&#148;), will be issued to participants in partial
          compensation for their service as directors of the Company. This Plan is
          designed to promote the long-term growth and financial success of the Company by
          enabling the Company to attract, retain and motivate directors by providing for
          or increasing their proprietary interest in the Company and by aligning the
          economic interests of directors with those of the Company&#146;s stockholders. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Definitions</U>. For purposes of this Plan: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The term &#147;Board&#148; shall mean the Company&#146;s Board of Directors. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The term &#147;Fair Market Value&#148; shall mean as of any date, and unless the
          Committee shall specify otherwise, the average of the high and low sale price
          per share of Common Stock as finally reported in the New York Stock Exchange
          Composite Transactions for the New York Stock Exchange or if shares of Common
          Stock are not sold on such date, the average of the high and low sale price per
          share of Common Stock as finally reported in the New York Stock Exchange
          Composite Transactions for the New York Stock Exchange for the most recent prior
          date on which shares of Common Stock were sold. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The term &#147;Participant&#148; shall mean any person who on a Payment Date is
          a member of the Board of Directors of the Company and is not a full-time
          employee of the Company or a subsidiary of the Company. For purposes of this
          Section 2(d), unless the Board provides otherwise, a person shall not be
          considered an employee solely by reason of serving as Chairman of the Board. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The term &#147;Payment Date&#148; shall mean the date on which each
          directors&#146; retainer fees are paid by the Company. Unless the Board
          specifies otherwise, the Payment Date shall be the date of the Annual Meeting of
          Stockholders of the Company. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Plan&#148; shall mean The Black &amp; Decker Non-Employee Directors Stock
          Plan, as approved by the Board on February 12, 1998, and adopted by the
          stockholders at the 1998 Annual Meeting of Stockholders, as the same may be
          amended from time to time. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The term &#147;Shares&#148; shall mean shares of Common Stock granted under this
          Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Effective Date</U>. This Plan shall become effective upon approval at the
          1998 Annual Meeting of Stockholders. Shares may not be issued under this Plan
          after termination of this Plan by the Board, after issuance of all of the Shares
          authorized for issuance under this Plan or more than 10 years after the date of
          stockholder approval of this Plan, whichever is earlier. Notwithstanding the
          foregoing, however, the 10-year limitation shall not apply with respect to
          Shares held in a deferred account that were deferred within the 10-year period,
          it being understood that deferred Shares may be issued after such 10-year period
          in accordance with valid deferral elections made by Participants. </FONT></P>

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<DIV STYLE="page-break-after:always"></DIV>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Plan Operation</U>. This Plan is intended to operate in a manner that meets
          the requirements of a formula plan under Rule 16b-3 (or its successor) adopted
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;). Accordingly, this Plan is intended to be self-governing and requires
          no discretionary action by any administrative body with regard to any
          transaction under this Plan. Subject to the foregoing, this Plan shall be
          administered by the Corporate Governance Committee of the Board, and all
          decisions, determinations and interpretations by the Committee regarding this
          Plan shall be final and binding on all current, future and former Participants.
          Such Committee may delegate to one or more of its members or to any person or
          persons such ministerial duties as it may deem advisable. To the extent any
          provision of this Plan or action taken hereunder fails to so operate under Rule
          16b-3, such provision or action shall be deemed null and void and shall be
          conformed so as to so operate, to the extent permitted by law and deemed
          advisable by the Board. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Stock Subject to Plan</U>. The maximum number of Shares that may be issued
          hereunder shall be 100,000, subject to adjustments under Section 6. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Adjustments</U>. If the outstanding securities of the class then subject to
          this Plan are increased, decreased or exchanged for or converted into cash,
          property or a different number or kind of shares or securities, or if cash,
          property or shares or securities are distributed in respect of such outstanding
          securities, in either case as a result of a reorganization, merger,
          consolidation, recapitalization, restructuring, reclassification, dividend
          (other than a regular quarterly cash dividend) or other distribution, stock
          split, reverse stock split, spin-off or the like, or if substantially all of the
          property and assets of the Company are sold, then unless the terms of such
          transaction shall provide otherwise, the Board shall make an appropriate
          adjustment in the number and/or type of shares or securities that may thereafter
          be issued under this Plan. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Stock Grants</U>. Commencing on the Effective Date, and on each Payment Date
          thereafter during the term of this Plan, each Participant shall be granted a
          number of Shares as specified by the Board to be paid in Shares. In addition, a
          Participant may elect to receive all or any portion of the directors&#146;
          annual retainer specified by the Board to be paid in cash in Shares under this
          Plan. If on any date upon which Shares are to be granted or issued under this
          Plan the number of Shares remaining available under this Plan is less than the
          number of Shares required for all grants to be made on such date, then any
          election to receive all or any portion of the cash portion of the
          directors&#146; annual retainer in Shares shall be void, and a proportionate
          amount of such available number of Shares shall be granted to each Participant,
          and in lieu of the Shares that otherwise would be issuable, the Participants
          shall be paid an amount in cash equal to (a) the difference between the portion
          of the directors&#146; annual retainer to be paid in Shares less the number of
          Shares then issued to the Participant, multiplied by (b) the Fair Market Value
          on that date. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Deferral of Shares</U>. A Participant may elect to defer receipt of all or
          any portion of the directors&#146; annual retainer under this Plan under and in
          accordance with rules established for this purpose under the Deferred
          Compensation Plan for Non-Employee Directors. This deferral shall be denominated
          in Common Stock as if the Participant had elected to receive such portion of the
          directors&#146; annual retainer in Shares, and thereafter such deferral shall be
          valued in Common Stock. This deferral shall be increased by the value of any
          dividends declared with respect to Common Stock, which value shall be deemed to
          be reinvested in Common Stock, based on the Fair Market Value on the record date
          for such dividends. The aggregate number of shares of Common Stock accumulated
          on behalf of the </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participant under this Plan shall be paid to the Participant in
          Shares under this Plan in accordance with the election made by the Participant
          under rules established for this purpose under the Deferred Compensation Plan
          for Non-Employee Directors. Notwithstanding the foregoing, in the event that the
          deemed reinvestment of any dividends in Common Stock would cause the Company to
          exceed the maximum of Shares that may be issued under this Plan, the Common
          Stock attributable to such dividends shall be paid to the Participant in cash
          based on the Fair Market Value on the date the Participant&#146;s deferral
          otherwise is paid. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Amendment and Termination</U>. The Board may alter, amend, suspend or
          terminate this Plan, provided that no such action shall deprive any Participant,
          without his or her consent, of any Shares theretofore issued under this Plan, or
          deferred under this Plan, and provided further that the provisions of this Plan
          designating persons eligible to participate in this Plan and specifying the
          retainer amounts payable to Participants hereunder and the amount and timing of
          grants under this Plan shall not be amended more than once every six months
          other than to comport with changes in the Internal Revenue Code of 1986, as
          amended, the Employee Retirement Income Security Act of 1974, as amended, or the
          rules thereunder, unless such restriction on amendments to this Plan is not
          necessary in order for the transactions contemplated by this Plan to be exempt
          under Rule 16b-3 of the Exchange Act. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Taxes</U>. The Board may make such provisions or impose such conditions as it
          may deem appropriate for the withholding or payment by a Participant of any
          taxes that it determines are necessary or appropriate in connection with any
          issuance of Shares under this Plan, and a Participant&#146;s rights in any
          Shares are subject to satisfaction of such conditions. The Company and any
          affiliate of the Company shall not be liable to a Participant or any other
          persons as to any tax consequence expected, but not realized, by any Participant
          or other person due to the receipt of any Shares granted hereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compliance with Law</U>. Shares shall not be issued under this Plan unless
          and until counsel for the Company shall be satisfied that any conditions
          necessary for such issuance to comply with applicable federal, state or local
          tax, securities or other laws or rules or applicable securities exchange
          requirements have been fulfilled. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Governing Law; Miscellaneous</U>. This Plan and any rights hereunder shall be
          interpreted and construed in accordance with the laws of the State of Maryland
          and applicable federal law. Neither this Plan nor any action taken pursuant
          thereto shall be construed as giving any Participant any right to be retained in
          the service of the Company or nominated for reelection to the Board. </FONT></P>

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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>form10k12312005d.htm
<DESCRIPTION>EXHIBIT 10(D)
<TEXT>
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<HEAD>
<TITLE></TITLE>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (d)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
1992 STOCK OPTION PLAN</B> </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
proper execution of the duties and responsibilities of the executives and other key
employees of The Black&nbsp;&amp; Decker Corporation and its subsidiaries is a vital
factor in the continued growth and success of the Corporation. Toward this end, it is
necessary to attract and retain effective and capable employees to assume positions that
contribute materially to the successful operation of the business of the Corporation. It
will benefit the Corporation, therefore, to bind the interests of these persons more
closely to its own interests by offering them an attractive opportunity to acquire a
proprietary interest in the Corporation and thereby provide them with added incentive to
remain in its employ and to increase the prosperity, growth, and earnings of the
Corporation. This stock option plan will serve these purposes. </FONT></P>

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<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 1:00 </FONT></H1>

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<A NAME=A003></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Definitions </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following terms wherever used herein shall have the meanings set forth below. </FONT></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Board of Directors&#148; shall mean the Board of Directors of the Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Cash Appreciation Right&#148; shall mean a right to receive cash pursuant
to Article&nbsp;11:00 of the Plan.  </FONT></TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Change in Control&#148; shall have the meaning provided in Section 10:02 of the Plan.  </FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Code&#148; shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder.   </FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Committee&#148; shall mean the Compensation Committee of the Board of Directors.
</FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Common Stock&#148; shall mean the shares of common stock,  par value $.50 per share, of the Corporation.
</FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Corporation&#148; shall mean The Black &amp; Decker Corporation.
</FONT></TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Exchange Act&#148; shall mean the Securities Exchange Act of 1934, as amended.
</FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Fair Market Value of a share of Common Stock&#148; shall mean the average
of the high and low sale price per share of Common Stock as finally reported in the New
York Stock Exchange Composite Transactions for the New York Stock Exchange, or if shares
of Common Stock are not sold on such date, the average of the high and low sale price per
share of Common Stock as finally reported in the New York Stock Exchange Composite
Transactions for the New York Stock Exchange for the most recent prior date on which
shares of Common Stock were sold. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Immediate Family Member&#148; shall mean each of (i) the children, step
children or grandchildren of the Initial Holder, (ii) the spouse or any parent of the
Initial Holder, (iii) any trust solely for the benefit of any such family members, and
(iv) any partnership or other entity in which such family members are the only partners or
other equity holders. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Incentive Stock Option&#148; shall mean any Option granted pursuant to the
Plan that is designated as an Incentive Stock Option and that satisfies the requirements
of Section 422(b) of the Code. </FONT></TD>
</TR>
</TABLE>
<BR>

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<DIV STYLE="page-break-after:always"></DIV>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Initial Holder,&#148; with respect to an Option or Right granted under the
Plan, shall mean the executive or other key employee of the Corporation granted the Option
or Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:13 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Limited Stock Appreciation Right&#148; shall mean a limited tandem stock
appreciation right that entitles the holder to receive cash upon a Change in Control
pursuant to Article 10:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:14 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Nonqualified Stock Option&#148; shall mean any Option granted pursuant to
the Plan that is not an Incentive Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Hang Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:15 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option&#148; or &#147;Stock Option&#148; shall mean a right granted
pursuant to the Plan to purchase shares of Common Stock, and shall include the terms
Incentive Stock Option and Nonqualified Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:16 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Agreement&#148; shall mean the written agreement representing
Options granted pursuant to the Plan as contemplated by Article&nbsp;6:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:17 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Holder&#148; shall mean the Initial Holder so long as he or she
holds an Option initially granted to the Initial Holder, and thereafter shall mean the
beneficiary or the Immediate Family Member to whom the Option has been transferred in
accordance with the terms and conditions provided in Section 6:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:18 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Plan&#148; shall mean The Black&nbsp;&amp; Decker 1992 Stock Option Plan as
approved by the Board of Directors on February 20, 1992, and adopted by the stockholders
of the Corporation at the 1992 Annual Meeting of Stockholders, as the same may be amended
from time to time. </FONT></TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:19 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Rights&#148; shall include Stock Appreciation Rights, Limited Stock
Appreciation Rights <BR>and Cash Appreciation Rights.</FONT></TD>
</TR>
</TABLE>
<BR>


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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:20 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Section 162(m) Regulations&#148; shall mean the regulations adopted
pursuant to Section 162(m) of the Code. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:21 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right&#148; shall mean a right to receive cash or shares
of Common Stock pursuant to Article 8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:22 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Agreement&#148; shall mean the written agreement
representing Stock Appreciation Rights granted pursuant to the Plan as contemplated by
Article&nbsp;8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:23 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Base Price&#148; shall mean the base price for
determining the value of a Stock Appreciation Right under Section 8:02, which Stock
Appreciation Right Base Price shall be established by the Committee at the time of the
grant of Stock Appreciation Rights pursuant to the Plan and shall not be less than 90% of
the Fair Market Value of a share of Common Stock on the date of grant. If the Committee
does not establish a specific Stock Appreciation Right Base Price at the time of grant,
the Stock Appreciation Right Base Price shall be equal to the Fair Market Value of a share
of Common Stock on the date of grant of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:24 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Holder&#148; shall mean the Initial Holder so long
as he or she holds a Stock Appreciation Right initially granted to the Initial Holder, and
thereafter shall mean the beneficiary or the Immediate Family Member to whom the Stock
Appreciation Right has been transferred in accordance with the terms and conditions
provided in Section 8:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:25 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;subsidiary&#148; or &#147;subsidiaries&#148; shall mean a corporation of
which capital stock possessing 50% or more of the total combined voting power of all
classes of its capital stock entitled to vote generally in the election of directors is
owned in the aggregate by the Corporation directly or indirectly through one or more
subsidiaries. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-2-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<A NAME=A006></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 2:00 </FONT></H1>

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<A NAME=A007></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effective Date of the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan shall become effective upon stockholder approval, provided that such approval is
received on or before May 31, 1992, and provided further that the Committee may grant
Options or Rights pursuant to the Plan prior to stockholder approval if such Options or
Rights by their terms are contingent upon subsequent stockholder approval of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A008></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 3:00 </FONT></H1>

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<A NAME=A009></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Administration </FONT></H1>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
    The Plan shall be administered by the Committee.
</FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may establish, from time to time and at any time, subject to the limitations
of the Plan as set forth herein, such rules and regulations and amendments and supplements
thereto as it deems necessary to comply with applicable law and regulation and for the
proper administration of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee shall from time to time determine the names of those executives and other
key employees who, in its opinion, should receive Options or Rights, and shall determine
the numbers of shares on which Options should be granted or upon which Rights should be
based to each such person and the nature of the Options or Rights to be granted, including
without limitation whether the Options or Rights shall be transferable in accordance with
the terms and conditions provided in Section 6:12 or Section&nbsp;8:11. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options and Rights shall be granted by the Corporation only upon prior approval of the
Committee, and upon the execution of an Option Agreement or Stock Appreciation Right
Agreement between the Corporation and the Initial Holder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee&#146;s interpretation and construction of the provisions of the Plan and the
rules and regulations adopted by the Committee shall be final. No member of the Committee
or the Board of Directors shall be liable for any action taken or determination made, in
respect of the Plan, in good faith. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A010></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 4:00 </FONT></H1>

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<A NAME=A011></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Participation in the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participation in the Plan shall be limited to such executives and other key employees of
the Corporation and its subsidiaries who at the date of grant of an Option or Right are
regular, full-time employees of the Corporation or any of its subsidiaries and who shall
be designated by the Committee together with any permitted transferees in accordance with
the terms and conditions of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No member of the Board of Directors who is not also an employee shall be eligible to
participate in the Plan. No employee who owns beneficially more than 10% of the total
combined voting power of all classes of stock of the Corporation shall be eligible to
participate in the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-3-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<A NAME=A012></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 5:00 </FONT></H1>

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<A NAME=A013></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Stock Subject to the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
There shall be reserved for the granting of Options or Stock Appreciation Rights pursuant
to the Plan and for issuance and sale pursuant to such Options or Stock Appreciation
Rights 2,400,000 shares of Common Stock. To determine the number of shares of Common Stock
available at any time for the granting of Options or Stock Appreciation Rights, there
shall be deducted from the total number of reserved shares of Common Stock the number of
shares of Common Stock in respect of which Options have been granted pursuant to the Plan
that are still outstanding or have been exercised. The shares of Common Stock to be issued
upon the exercise of Options or Stock Appreciation Rights granted pursuant to the Plan
shall be made available from the authorized and unissued shares of Common Stock. If for
any reason shares of Common Stock as to which an Option has been granted cease to be
subject to purchase thereunder, then such shares of Common Stock again shall be available
for issuance pursuant to the exercise of Options or Stock Appreciation Rights pursuant to
the Plan. Except as provided in Section 5:03, however, the aggregate number of shares of
Common Stock that may be issued upon the exercise of Options and Stock Appreciation Rights
pursuant to the Plan shall not exceed 2,400,000 shares and no more than 2,400,000 Stock
Appreciation Rights shall be granted pursuant to the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Proceeds from the purchase of shares of Common Stock upon the exercise of Options granted
pursuant to the Plan shall be used for the general business purposes of the Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Subject to the provisions of Section 10:01, in the event of reorganization,
recapitalization, stock split, stock dividend, combination of shares of Common Stock,
merger, consolidation, share exchange, acquisition of property or stock, or any change in
the capital structure of the Corporation, the Committee shall make such adjustments as may
be appropriate in the number of Options or Stock Appreciation Rights that may be granted
to an employee in any calendar year, in the number and kind of shares reserved for
purchase by executives or other key employees, in the number, kind and price of shares
covered by Options and Stock Appreciation Rights granted pursuant to the Plan but not then
exercised, and in the number of Rights, if any, granted pursuant to the Plan but not then
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A014></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 6:00 </FONT></H1>

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<A NAME=A015></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such
form and with such terms and conditions (including, without limitation, noncompete,
confidentiality or other similar provisions or provisions relating to transfer) as the
Committee from time to time may determine. The right of an Option Holder to exercise his,
her or its Option shall at all times be subject to the terms and conditions set forth in
the respective Option Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The exercise price per share for Options shall be established by the Committee at the time
of the grant of Options pursuant to the Plan and shall not be less than 90% of the Fair
Market Value of a share of Common Stock on the date on which the Option is granted. If the
Committee does not establish a specific exercise price per share at the time of grant, the
exercise price per share shall be equal to the Fair Market Value of a share of Common
Stock on the date of grant of the Options. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option, subject to the other limitations set forth in the Plan, may extend for a
period of up to 10 years from the date on which it is granted. The term of each Option
shall be determined by the Committee at the time of grant of the Option, provided that if
no term is established by the Committee the term of the Option shall be 10 years from the
date on which it is granted. </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-4-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of shares of Common Stock subject
to each Option shall be divided into four installments of 25% each. The first installment
shall be exercisable 12 months after the date the Option was granted, and each succeeding
installment shall be exercisable 12 months after the date the immediately preceding
installment became exercisable. If an Option Holder does not purchase the full number of
shares of Common Stock that he, she or it at any time has become entitled to purchase, the
Option Holder may purchase all or any part of those shares of Common Stock at any
subsequent time during the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options shall be nontransferable and nonassignable, except that (i) Options may be
transferred by testamentary instrument or by the laws of descent and distribution, and
(ii) subject to the terms and conditions of the Option Agreement or any other terms and
conditions imposed by the Committee from time to time, Options may be transferred in
accordance with the terms and conditions provided in Section 6:12 if the applicable Option
Agreement or other action of the Committee expressly provides that the Options are
transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Option (including any Option transferred in accordance with the terms and conditions
provided in Section 6.12) and all rights thereunder shall terminate effective at the close
of business on the date the Initial Holder ceases to be a regular, full-time employee of
the Corporation or any of its subsidiaries, except (i) to the extent previously exercised,
(ii) as provided in Sections 6:07, 6:08, and 6:09, and (iii) in the case of involuntary
termination of employment, for a period of 30 days thereafter the Option Holder shall be
entitled to exercise that portion of the Option that was exercisable at the close of
business on the date the Initial Holder ceased to be a regular, full-time employee of the
Corporation or any of its subsidiaries, provided that in no event may any Option be
exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In the event an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii)&nbsp;takes a
leave of absence from the Corporation or any of its subsidiaries for personal reasons or
as a result of entry into the armed forces of the United States, or any of the departments
or agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Option Agreement as it may deem
appropriate under the circumstances, including accelerating the time previously granted
Options may be exercised and extending the time following the Initial Holder&#146;s
termination of employment during which the Option Holder is entitled to purchase the
shares of Common Stock subject to such Options, provided that in no event may any Option
be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Option without the Option having
been exercised in full, (i) the executor or administrator of his or her estate or the
person who inherits the right to exercise the Option by bequest or inheritance in the
event the Initial Holder was the Option Holder at the date of death or (ii)&nbsp;the
Option Holder in the event the Option had been transferred in accordance with the terms
and conditions provided in Section 6:12, shall have the right within three years of the
Initial Holder&#146;s death to purchase the number of shares of Common Stock that the
deceased Initial Holder (or Option Holder, as the case may be) was entitled to purchase at
the date of death, after which the Option shall lapse, provided that in no event may any
Option be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without the Option having been
exercised in full and (i)&nbsp;the Initial Holder is 62 years of age or older, or (ii) the
Initial Holder has been employed by the Corporation or any of its subsidiaries for at
least 10 years and the Initial Holder&#146;s age plus years of such employment total not
less than 55 years, then such Initial Holder (or the Option Holder in the event the Option
had been transferred in accordance with the terms and conditions provided in Section 6:12)
shall have the right within three years of the Initial Holder&#146;s termination of
employment</FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-5-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
to purchase the number of shares of Common Stock that the Initial Holder (or
Option Holder, as the case may be) was entitled to purchase at the date of termination,
after which the Option shall lapse, provided that in no event may any Option be exercised
after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of an Option pursuant to the Plan shall not constitute or be evidence of any
agreement or understanding, express or implied, on the part of the Corporation or any of
its subsidiaries to employ the Initial Holder for any specified period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the general terms and conditions set forth in this Article 6:00 in respect
of Options granted pursuant to the Plan, Incentive Stock Options granted pursuant to the
Plan shall be subject to the following additional terms and conditions: </FONT></TD>
</TR>
</TABLE>
<BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The aggregate fair market value (determined at the time the Incentive Stock
                    Option is granted) of the shares of Common Stock in respect of which
                    &#147;incentive stock options&#148; are exercisable for the first time by the
                    Option Holder during any calendar year (under all such plans of the Corporation
                    and its subsidiaries) shall not exceed $100,000; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Agreement in respect of an Incentive Stock Option may contain any
                    other terms and conditions specified by the Committee that are not inconsistent
                    with the Plan, except that such terms and conditions must be consistent with the
                    requirements for &#147;incentive stock options&#148; under Section 422 of the
                    Code; and </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Incentive Stock Options shall not be transferable in accordance with the terms
                    and conditions provided in Section 6:12. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Nonqualified Stock Option or in an
amendment or supplement to a previous grant, that some or all of the Nonqualified Stock
Options granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Option Agreement, as it may be
amended from time to time, expressly so provides or the Committee otherwise designates the
Option as transferable, (ii) the transfer by the Initial Holder is a bona fide gift
without consideration, (iii) the transfer is irrevocable, (iv)&nbsp;the Initial Holder and
any such transferee provides such documentation or other information concerning the
transfer or the transferee as the Committee or any employee of the Corporation acting on
behalf of the Committee may from time to time request, and (v)&nbsp;the Initial Holder or
the Option Holder complies with all of the terms and conditions (including, without
limitation, any further restrictions or limitations) included in the Option Agreement. Any
Nonqualified Stock Option transferred in accordance with the terms and conditions provided
in this Section 6:12 shall continue to be subject to the same terms and conditions that
were applicable to such Nonqualified Stock Option prior to the transfer. Notwithstanding
any other provisions of the Plan, the Corporation shall not be required to honor any
exercise of an Option by an Immediate Family Member of an Option transferred in accordance
with the terms and conditions provided in this Section 6:12 unless and until payment or
provision for payment of any applicable withholding taxes has been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A016></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 7:00 </FONT></H1>

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<A NAME=A017></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder (or other person or persons, if any, entitled to exercise an Option
hereunder) desiring to exercise an Option granted pursuant to the Plan as to all or part
of the shares of Common Stock covered by the Option shall (i) notify either the
Corporation at its principal office at 701 East Joppa Road, Towson, Maryland 21286, or the
third party retained by the Corporation to administer the Plan to that effect, specifying
the number of shares of Common Stock to be purchased and the </FONT></TD>
</TR>
</TABLE>
<BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-6-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>method of payment therefor,
and (ii) make payment or provision for payment for the shares of Common Stock so purchased
in accordance with this Article 7:00. </FONT></TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Payment or provision for payment shall be made as follows: </FONT></TD>
</TR>
</TABLE>
<BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall deliver to the Corporation at the address set forth in
                    Section 7:01 United States currency in an amount equal to the aggregate purchase
                    price of the shares of Common Stock as to which such exercise relates; or </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall tender to the Corporation shares of Common Stock already
                    owned by the Option Holder that, together with any cash tendered therewith, have
                    an aggregate fair market value (determined based on the Fair Market Value of a
                    share of Common Stock on the date the notice set forth in Section 7:01 is
                    received by the Corporation) equal to the aggregate purchase price of the shares
                    of Common Stock as to which such exercise relates; or </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall deliver irrevocable instructions to a broker to deliver
                    promptly to the Corporation the amount of sale or loan proceeds necessary to pay
                    the aggregate purchase price of the shares of Common Stock as to which such
                    exercise relates and to sell the shares of Common Stock to be issued upon
                    exercise of the Option and deliver the cash proceeds less commissions and
                    brokerage fees to the Option Holder or to deliver the remaining shares of Common
                    Stock to the Option Holder. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding
the foregoing provisions, the Committee, in granting Options pursuant to the Plan, may
limit the methods in which an Option may be exercised by any person and, in processing any
purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the
method of exercise selected by the Option Holder (other than the method of exercise set
forth in Section 7:02(a)) if, (A) in the opinion of counsel to the Corporation, (i) the
Initial Holder or the Option Holder is or within the six months preceding such exercise
was subject to reporting under Section 16(a) of the Exchange Act and (ii) there is a
substantial likelihood that the method of exercise selected by the Option Holder would
subject the Initial Holder or the Option Holder to a substantial risk of liability under
Section 16 of the Exchange Act, (B) in the opinion of the Committee, the method of
exercise could have an adverse tax or accounting effect to the Corporation, or (C) in the
opinion of counsel to the Corporation, the method of exercise selected by the Option
Holder would subject the Corporation to a risk of liability under the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the alternative methods of exercise set forth in Section 7:02, holders of
Nonqualified Stock Options shall be entitled, at or prior to the time the notice provided
for in Section 7:01 is provided to the Corporation, to elect to have the Corporation
withhold from the shares of Common Stock to be delivered upon exercise of the Nonqualified
Stock Option that number of shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section 7:01 is
received by the Corporation) necessary to satisfy any withholding taxes attributable to
the exercise of the Nonqualified Stock Option. The maximum number of shares that an Option
Holder may elect to have withheld from the shares of Common Stock otherwise deliverable
upon exercise shall be the number of shares that have an aggregate fair market value
(based on the Fair Market Value of a share of Common Stock on the date of the exercise)
equal to the dollar amount of the minimum statutory withholding for federal, state and
local taxes, including payroll taxes, payable by the Option Holder. Alternatively, such
holder of a Nonqualified Stock Option may elect to deliver previously owned shares of
Common Stock (which shares have been held for at least six months) upon exercise of the
Nonqualified Stock Option to satisfy any withholding taxes attributable to the exercise of
the Nonqualified Stock Option. Notwithstanding the foregoing provisions, the Committee may
include in the Option Agreement relating to any such Nonqualified Stock Option provisions
limiting or eliminating the Option Holder&#146;s ability to pay his or her withholding tax
obligation by withholding or delivering shares of Common Stock or, if no such </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-7-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
provisions
are included in the Option Agreement but in the opinion of the Committee such withholding
or delivery of shares would have an adverse tax or accounting effect to the Corporation,
at or prior to exercise of the Nonqualified Stock Option the Committee may so limit or
eliminate the Option Holder&#146;s ability to pay his or her withholding tax obligation
with shares of Common Stock. Notwithstanding the foregoing provisions, a holder of a
Nonqualified Stock Option may not elect any of the methods of satisfying his or her
withholding tax obligation in respect of any exercise if, in the opinion of counsel to the
Corporation, (i) the Initial Holder or the holder of the Nonqualified Stock Option is or
within the six months preceding such exercise was subject to reporting under Section 16(a)
of the Exchange Act and (ii) there is a substantial likelihood that the election or timing
of the election would subject the Initial Holder or the holder of the Nonqualified Stock
Option to a substantial risk of liability under Section 16 of the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder at any time may elect in writing to abandon an Option in respect of all
or part of the number of shares of Common Stock as to which the Option shall not have been
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder shall have none of the rights of a stockholder of the Corporation until
the shares of Common Stock covered by the Option are issued upon exercise of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A018></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 8:00 </FONT></H1>

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<A NAME=A019></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Stock Appreciation Rights </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right granted pursuant to the Plan shall be evidenced by a Stock
Appreciation Right Agreement in such form and with such terms and conditions (including,
without limitation, noncompete, confidentiality or other similar provisions or provisions
relating to transfer) as the Committee from time to time may determine. Notwithstanding
the foregoing provision, Stock Appreciation Rights granted in tandem with a related Option
shall be evidenced by the Option Agreement in respect of the related Option. The right of
a Stock Appreciation Right Holder to exercise his, her or its Stock Appreciation Right
shall at all times be subject to the terms and conditions set forth in the respective
Stock Appreciation Right Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right shall entitle the holder, subject to the terms and
conditions of the Plan, to receive upon exercise of the Stock Appreciation Right an
amount, payable in cash or shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section&nbsp;9:01 is
received by the Corporation), equal to the Fair Market Value of a share of Common Stock on
the date of receipt by the Corporation of the notice required by Section&nbsp;9:01 less
the Stock Appreciation Right Base Price. Notwithstanding the foregoing provision, each
Stock Appreciation Right that is granted in tandem with a related Option shall entitle the
holder, subject to the terms and conditions of the Plan, to surrender to the Corporation
for cancellation all or a portion of the related Option, but only to the extent such Stock
Appreciation Right and related Option then are exercisable, and to be paid therefor an
amount, payable in cash or shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section&nbsp;9:01 is
received by the Corporation), equal to the Fair Market Value of a share of Common Stock on
the date of receipt by the Corporation of the notice required by Section&nbsp;9:01 less
the Stock Appreciation Right Base Price. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right, subject to the other limitations set forth in the Plan, may
extend for a period of up to 10 years from the date on which it is granted. The term of
each Stock Appreciation Right shall be determined by the Committee at the time of grant of
the Stock Appreciation Right, provided that if no term is established by the Committee the
term of the Stock Appreciation Right shall be 10 years from the date on which it is
granted. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of Stock Appreciation Rights
granted </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-8-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
pursuant to each Stock Appreciation Right Agreement shall be divided into four
installments of 25% each. The first installment shall be exercisable 12 months after the
date the Stock Appreciation Right was granted, and each succeeding installment shall be
exercisable 12 months after the date the immediately preceding installment became
exercisable. If a Stock Appreciation Right Holder does not exercise the Stock Appreciation
Right to the extent that he, she or it at any time has become entitled to exercise the
Stock Appreciation Right, the Stock Appreciation Right Holder may exercise all or any part
of the Stock Appreciation Right at any subsequent time during the term of the Stock
Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Stock Appreciation Rights shall be nontransferable and nonassignable, except that (i)
Stock Appreciation Rights may be transferred by testamentary instrument or by the laws of
descent and distribution, and (ii) subject to the terms and conditions of the Stock
Appreciation Right Agreement or any other terms and conditions imposed by the Committee
from time to time, Stock Appreciation Rights may be transferred in accordance with the
terms and conditions provided in Section 8:11 if the applicable Stock Appreciation Right
Agreement or other action of the Committee expressly provides that the Stock Appreciation
Rights are transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Stock Appreciation Rights (including any Stock Appreciation Rights transferred in
accordance with the terms and conditions provided in Section 8:11) and all rights
thereunder shall terminate effective as of the close of business on the date the Initial
Holder ceases to be a regular, full-time employee of the Corporation or any of its
subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections
8:07, 8:08, and 8:09, and (iii) in the case of involuntary termination of employment, for
a period of 30 days thereafter the Stock Appreciation Right Holder shall be entitled to
exercise that portion of each Stock Appreciation Right that was exercisable at the close
of business on the date the Initial Holder ceased to be a regular, full-time employee of
the Corporation or any of its subsidiaries. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In the event an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii) takes a leave
of absence from the Corporation or any of its subsidiaries for personal reasons or as a
result of entry into the armed forces of the United States, or any of the departments or
agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Stock Appreciation Right Agreement
as it may deem appropriate under the circumstances, including accelerating the time
previously granted Stock Appreciation Rights may be exercised and extending the time
following the Initial Holder&#146;s termination of employment during which the Stock
Appreciation Right Holder is entitled to exercise the Stock Appreciation Rights, provided
that in no event may any Stock Appreciation Right be exercised after the expiration of the
term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Stock Appreciation Right without
the Stock Appreciation Right having been exercised in full, (i) the executor or
administrator of the Stock Appreciation Right Holder&#146;s estate or the person who
inherits the right to exercise the Stock Appreciation Right by bequest or inheritance in
the event the Initial Holder was the Stock Appreciation Right Holder at the date of death
or (ii) the Stock Appreciation Right Holder in the event the Stock Appreciation Right had
been transferred in accordance with the terms and conditions provided in Section 8:11,
shall have the right within three years of the Initial Holder&#146;s death to exercise the
Stock Appreciation Rights that the deceased Initial Holder (or the Stock Appreciation
Right Holder, as the case may be) was entitled to purchase at the date of death, after
which the Stock Appreciation Right shall lapse, provided that in no event may any Stock
Appreciation Right be exercised after the expiration of the term of the Stock Appreciation
Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without his or her Stock Appreciation
Rights having been exercised in full and (i) the Initial Holder is 62 years of age or
older, or (ii) the Initial Holder has been employed by the Corporation or any of its
subsidiaries for at least 10 years and the Initial </FONT></TD>
</TR>
</TABLE>
<BR>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-9-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Holder&#146;s age plus years of such
employment total not less than 55 years, then such Initial Holder (or the Stock
Appreciation Right Holder in the event the Stock Appreciation Right had been transferred
in accordance with the terms and conditions provided in Section 8:11) shall have the right
within three years of the Initial Holder&#146;s termination of employment to exercise the
Stock Appreciation Rights that the Initial Holder (or Stock Appreciation Right Holder, as
the case may be) was entitled to exercise at the date of termination, after which the
Stock Appreciation Right shall lapse, provided that in no event may any Stock Appreciation
Right be exercised after the expiration of the term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of a Stock Appreciation Right pursuant to the Plan shall not constitute or be
evidence of any agreement or understanding, expressed or implied, on the part of the
Corporation or any of its subsidiaries to employ the Initial Holder for any specified
period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Stock Appreciation Right or in an
amendment or supplement to a previous grant, that some or all of the Stock Appreciation
Rights granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Stock Appreciation Right
Agreement, as it may be amended from time to time, expressly so provides or the Committee
otherwise designates the Stock Appreciation Right as transferable, (ii) the transfer by
the Initial Holder is a bona fide gift without consideration, (iii) the transfer is
irrevocable, (iv) the Initial Holder and any such transferee provides such documentation
or other information concerning the transfer or the transferee as the Committee or any
employee of the Corporation acting on behalf of the Committee may from time to time
request, and (v)&nbsp;the Initial Holder or the Stock Appreciation Right Holder complies
with all of the terms and conditions (including, without limitation, any further
restrictions or limitations) included in the Stock Appreciation Right Agreement. Any Stock
Appreciation Right transferred in accordance with the terms and conditions provided in
this Section 8:11 shall continue to be subject to the same terms and conditions that were
applicable to such Stock Appreciation Right prior to the transfer. Notwithstanding any
other provisions of the Plan, the Corporation shall not be required to honor any exercise
of a Stock Appreciation Right by an Immediate Family Member of a Stock Appreciation Right
transferred in accordance with the terms and conditions provided in this Section 8:11
unless and until payment or provision for payment of any applicable withholding taxes has
been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A020></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 9:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A021></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Stock Appreciation Rights </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A Stock Appreciation Right Holder (or other person or persons, if any, entitled to
exercise a Stock Appreciation Right hereunder) desiring to exercise a Stock Appreciation
Right granted pursuant to the Plan shall notify the Corporation in writing at its
principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect,
specifying the number of Stock Appreciation Rights to be exercised. Such written notice
may be given by means of a facsimile transmission. If a facsimile transmission is used,
the Stock Appreciation Right Holder should mail the original executed copy of the written
notice to the Corporation promptly thereafter. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee in its sole and absolute discretion shall determine whether a Stock
Appreciation Right shall be settled upon exercise in cash or in shares of Common Stock.
The Committee, in making such a determination, may from time to time adopt general
guidelines or determinations as to whether Stock Appreciation Rights shall be settled in
cash or in shares of Common Stock. </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-10-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<A NAME=A022></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 10:00 </FONT></H1>

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<A NAME=A023></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Limited Stock
Appreciation Rights </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding any other provision of the Plan, the Committee, in its sole and absolute
discretion, may grant Limited Stock Appreciation Rights entitling Option Holders to
receive, in connection with a Change in Control (as defined in Section 10:02), a cash
payment in cancellation of all of their Options that are outstanding on the date the
Change in Control occurs (whether or not such Options are then presently exercisable),
which payment shall be equal to the number of shares covered by the cancelled Options
multiplied by the excess over the exercise price of the Options of the higher of the
(i)&nbsp;Fair Market Value of a share of Common Stock on the date of the Change in Control
or (ii)&nbsp;the highest per share price paid for the shares of Common Stock in connection
with the Change in Control (with the value of any noncash consideration paid in connection
with the Change in Control to be determined by the Committee in its sole and absolute
discretion and if the Committee, in its sole and absolute discretion, determines that such
valuation will comply with Section 409A of the Code). For purposes of this Section 10:01
as well as the other provisions of this Plan, once an Option or portion of an Option has
terminated, lapsed or expired, or has been abandoned, in accordance with the provisions of
the Plan, the Option (or the portion of the Option) that has terminated, lapsed or
expired, or has been abandoned, shall cease to be outstanding. Limited Stock Appreciation
Rights shall not be exercisable at the discretion of the Option Holder but shall
automatically be exercised upon a Change in Control. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A &#147;Change in Control&#148; shall mean a change in control of the Corporation of a
nature that would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Exchange Act, whether or not the Corporation is in
fact required to comply therewith, provided that, without limitation, such a change in
control shall be deemed to have occurred if (A) any &#147;person&#148; (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Corporation or any of
its subsidiaries, or a corporation owned, directly or indirectly, by the stockholders of
the Corporation in substantially the same proportions as their ownership of stock of the
Corporation, is or becomes the &#147;beneficial owner&#148; (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Corporation
representing 20% or more of the combined voting power of the Corporation&#146;s then
outstanding securities; or (B)&nbsp;during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board of Directors and any
new director (other than a director designated by a person who has entered into an
agreement with the Corporation to effect a transaction described in clauses (A) or (D) of
this Section 10.02) whose election by the Board of Directors or nomination for election by
the Corporation&#146;s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for any reason
to constitute a majority thereof; (C) the Corporation enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control; or (D) the
stockholders of the Corporation approve a merger, share exchange or consolidation of the
Corporation with any other corporation, other than a merger, share exchange or
consolidation that would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least 60% of the
combined voting power of the voting securities of the Corporation or such surviving entity
outstanding immediately after such merger, share exchange or consolidation, or the
stockholders of the Corporation approve a plan of complete liquidation of the Corporation
or an agreement for the sale or disposition by the Corporation of all or substantially all
the Corporation&#146;s assets. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Limited Stock Appreciation Rights shall be nontransferable and nonassignable, except that
Limited Stock Appreciation Rights shall automatically be transferred and assigned in
tandem with a transfer of</FONT></TD>
</TR>
</TABLE>
<BR>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-11-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
the related Options in accordance with Section 6:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 11:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A025></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Cash Appreciation Rights </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Cash Appreciation Rights may be granted concurrently with Options or Stock Appreciation
Rights granted pursuant to the Plan in the sole and absolute discretion of the Committee.
If Cash Appreciation Rights are granted to an Initial Holder, the number of Cash
Appreciation Rights granted to the Initial Holder shall equal the number of shares of
Common Stock that may be purchased upon exercise of the related Option or the number of
Stock Appreciation Rights granted, as the case may be. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Cash Appreciation Rights shall entitle the Initial Holder or the Option Holder, as the
case may be, subject to the terms and conditions of the Plan including but not limited to
the limitations set forth in Section 11:03, to receive from the Corporation or the
subsidiary employing the Initial Holder upon exercise of all or part of the related Option
or Stock Appreciation Right, as the case may be, or in the case of Options granted in
tandem with Stock Appreciation Rights upon the surrender of all or part of the related
Option granted in exchange for the exercise of Stock Appreciation Rights granted to the
Initial Holder pursuant to the Plan, whether or not such exercise or surrender was by the
Initial Holder or a permitted transferee, a payment in cash equal to the sum of (i) the
increase in income taxes, if any, incurred by the Initial Holder or the Option Holder, as
the case may be, as a result of the full or partial exercise of the related Option or
Stock Appreciation Right, as the case may be, and (ii)&nbsp;the increase in income taxes,
if any, incurred by the Initial Holder or the Option Holder, as the case may be, as a
result of receipt of this cash payment. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In no event shall the payment in respect of a Cash Appreciation Right exceed the increase,
if any, of the Fair Market Value of a share of Common Stock on the date of exercise of the
related Option or Stock Appreciation Right, as the case may be, over the exercise price
per share of the related Option or the Stock Appreciation Right Base Price of the related
Stock Appreciation Right, as the case may be. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Except as otherwise contemplated in this Article 11:00, Cash Appreciation Rights shall be
nontransferable and nonassignable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A026></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 12:00 </FONT></H1>

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<A NAME=A027></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amendments and
Discontinuance of the Plan </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Board of Directors shall have the right at any time and from time to time to amend,
modify, or discontinue the Plan provided that, except as provided in Section&nbsp;5:03, no
such amendment, modification, or discontinuance of the Plan shall (i) revoke or alter the
terms of any valid Option, Stock Appreciation Right, Limited Stock Appreciation Right, or
Cash Appreciation Right previously granted pursuant to the Plan, (ii) increase the number
of shares of Common Stock to be reserved for issuance and sale pursuant to Options or
Stock Appreciation Rights granted pursuant to the Plan, (iii) decrease the price
determined pursuant to the provisions of Section 6:02 or increase the amount of cash or
shares of Common Stock that a Stock Appreciation Right Holder is entitled to receive upon
exercise of a Stock Appreciation Right, (iv) change the class of employee to whom Options
or Stock Appreciation Rights may be granted pursuant to the Plan, or (v) provide for
Options or Stock Appreciation Rights exercisable more than 10 years after the date
granted. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-12-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<A NAME=A028></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 13:00 </FONT></H1>

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<A NAME=A029></A>

<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan Subject to
Governmental Laws and Regulations </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan and the grant and exercise of Options, Stock Appreciation Rights, Limited Stock
Appreciation Rights, and Cash Appreciation Rights pursuant to the Plan shall be subject to
all applicable governmental laws and regulations. Notwithstanding any other provision of
the Plan to the contrary, the Board of Directors may in its sole and absolute discretion
make such changes in the Plan as may be required to conform the Plan to such laws and
regulations. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A030></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 14:00 </FONT></H1>

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<A NAME=A031></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Duration of the Plan </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No Option or Stock Appreciation Right shall be granted pursuant to the Plan after the
close of business on February 19, 2002. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-13-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>5
<FILENAME>form10k12312005e.htm
<DESCRIPTION>EXHIBIT 10(F)
<TEXT>

<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (f)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
1996 STOCK OPTION PLAN </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
proper execution of the duties and responsibilities of the executives and other key
employees of The Black&nbsp;&amp; Decker Corporation and its subsidiaries is a vital
factor in the continued growth and success of the Corporation. Toward this end, it is
necessary to attract and retain effective and capable employees to assume positions that
contribute materially to the successful operation of the business of the Corporation. It
will benefit the Corporation, therefore, to bind the interests of these persons more
closely to its own interests by offering them an attractive opportunity to acquire a
proprietary interest in the Corporation and thereby provide them with added incentive to
remain in its employ and to increase the prosperity, growth, and earnings of the
Corporation. This stock option plan will serve these purposes. </FONT></P>

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<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 1:00 </FONT></H1>

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<A NAME=A003></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Definitions </FONT></H1>
<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following terms wherever used herein shall have the meanings set forth below. </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Board of Directors&#148; shall mean the Board of Directors of the Corporation.

 </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Change in Control&#148; shall have the meaning provided in Section 10:02 of the Plan.

 </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Code&#148; shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Committee&#148; shall mean the Compensation Committee of the Board of Directors.
 </FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Common
Stock&#148; shall mean the shares of common stock, par value $.50 per share, of the
Corporation.
 </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Corporation&#148; shall mean The Black &amp; Decker Corporation.
 </FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Exchange Act&#148; shall mean the Securities Exchange Act of 1934, as amended.
 </FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Fair Market Value of a share of Common Stock&#148; shall mean the average
of the high and low sale price per share of Common Stock as finally reported in the New
York Stock Exchange Composite Transactions for the New York Stock Exchange, or if shares
of Common Stock are not sold on such date, the average of the high and low sale price per
share of Common Stock as finally reported in the New York Stock Exchange Composite
Transactions for the New York Stock Exchange for the most recent prior date on which
shares of Common Stock were sold. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Immediate Family Member&#148; shall mean each of (i)&nbsp;the children,
step children or grandchildren of the Initial Holder, (ii) the spouse or any parent of the
Initial Holder, (iii) any trust solely for the benefit of any such family members, and
(iv) any partnership or other entity in which such family members are the only partners or
other equity holders. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Incentive Stock Option&#148; shall mean any Option granted pursuant to the
Plan that is designated as an Incentive Stock Option and that satisfies the requirements
of Section 422(b) of the Code. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Initial Holder,&#148; with respect to an Option or Right granted under the
Plan, shall mean the executive or other key employee of the Corporation granted the Option
or Right. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2></FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Limited Stock Appreciation Right&#148; shall mean a limited tandem stock
appreciation right that entitles the holder to receive cash upon a Change in Control
pursuant to Article 10:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:13 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Nonqualified Stock Option&#148; shall mean any Option granted pursuant to
the Plan that is not an Incentive Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:14 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option&#148; or &#147;Stock Option&#148; shall mean a right granted
pursuant to the Plan to purchase shares of Common Stock, and shall include the terms
Incentive Stock Option and Nonqualified Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:15 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Agreement&#148; shall mean the written agreement representing
Options granted pursuant to the Plan as contemplated by Article&nbsp;6:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:16 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Holder&#148; shall mean the Initial Holder so long as he or she
holds an Option initially granted to the Initial Holder, and thereafter shall mean the
beneficiary or the Immediate Family Member to whom the Option has been transferred in
accordance with Section&nbsp;6:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:17 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Plan&#148; shall mean The Black&nbsp;&amp; Decker 1996 Stock Option Plan as
approved by the Board of Directors on February 14, 1996, and adopted by the stockholders
of the Corporation at the 1996 Annual Meeting of Stockholders, as the same may be amended
from time to time. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:18 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Rights&#148; shall include Stock Appreciation Rights and Limited Stock Appreciation Rights. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:19 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Section 162(m)
Regulations&#148; shall mean the regulations adopted pursuant to Section 162(m) of the
Code. </FONT></TD>
</TR>
</TABLE>
<BR>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:20 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right&#148; shall mean a right to receive cash or shares
of Common Stock pursuant to Article 8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:21 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Agreement&#148; shall mean the written agreement
representing Stock Appreciation Rights granted pursuant to the Plan as contemplated by
Article&nbsp;8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:22 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Base Price&#148; shall mean the base price for
determining the value of a Stock Appreciation Right under Section 8:02, which Stock
Appreciation Right Base Price shall be established by the Committee at the time of the
grant of Stock Appreciation Rights pursuant to the Plan and shall not be less than the
Fair Market Value of a share of Common Stock on the date of grant. If the Committee does
not establish a specific Stock Appreciation Right Base Price at the time of grant, the
Stock Appreciation Right Base Price shall be equal to the Fair Market Value of a share of
Common Stock on the date of grant of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:23 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Holder&#148; shall mean the Initial Holder so long
as he or she holds a Stock Appreciation Right initially granted to the Initial Holder, and
thereafter shall mean the beneficiary or the Immediate Family Member to whom the Stock
Appreciation Right has been transferred in accordance with Section&nbsp;8:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:24 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;subsidiary&#148; or &#147;subsidiaries&#148; shall mean a corporation of
which capital stock possessing 50% or more of the total combined voting power of all
classes of its capital stock entitled to vote generally in the election of directors is
owned in the aggregate by the Corporation directly or indirectly through one or more
subsidiaries. </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-2-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<A NAME=A004></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 2:00 </FONT></H1>

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<A NAME=A005></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effective Date of the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan shall become effective upon stockholder approval, provided that such approval is
received on or before May 31, 1996, and provided further that the Committee may grant
Options or Rights pursuant to the Plan prior to stockholder approval if such Options or
Rights by their terms are contingent upon subsequent stockholder approval of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A006></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 3:00 </FONT></H1>

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<A NAME=A007></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Administration </FONT></H1>


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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan shall be administered by the Committee.</FONT></TD>
</TR>
</TABLE>
<BR>



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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may establish, from time to time and at any time, subject to the limitations
of the Plan as set forth herein, such rules and regulations and amendments and supplements
thereto as it deems necessary to comply with applicable law and regulation and for the
proper administration of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee shall from time to time determine the names of those executives and other
key employees who, in its opinion, should receive Options or Rights, and shall determine
the numbers of shares on which Options should be granted or upon which Rights should be
based to each such person and the nature of the Options or Rights to be granted, including
without limitation whether the Options or Rights shall be transferable in accordance with
the terms and conditions provided in Section 6:12 or Section&nbsp;8:11. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options and Rights shall be granted by the Corporation only upon the prior approval of the
Committee and upon the execution of an Option Agreement or Stock Appreciation Right
Agreement between the Corporation and the Initial Holder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee&#146;s interpretation and construction of the provisions of the Plan and the
rules and regulations adopted by the Committee shall be final. No member of the Committee
or the Board of Directors shall be liable for any action taken or determination made, in
respect of the Plan, in good faith. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A008></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 4:00 </FONT></H1>

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<A NAME=A009></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Participation in the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participation in the Plan shall be limited to such executives and other key employees of
the Corporation and its subsidiaries who at the date of grant of an Option or Right are
regular, full-time employees of the Corporation or any of its subsidiaries and who shall
be designated by the Committee together with any permitted transferees in accordance with
the terms and conditions of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No member of the Board of Directors who is not also an employee shall be eligible to
participate in the Plan. No employee who owns beneficially more than 10% of the total
combined voting power of all classes of stock of the Corporation shall be eligible to
participate in the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No employee may be granted, in any calendar year, Options or Stock Appreciation Rights
exceeding 500,000 in the aggregate under the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-3-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<A NAME=A010></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 5:00 </FONT></H1>

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<A NAME=A011></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Stock Subject to the
Plan </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
There shall be reserved for the granting of Options or Stock Appreciation Rights pursuant
to the Plan and for issuance and sale pursuant to such Options or Stock Appreciation
Rights 10,400,000 shares of Common Stock. To determine the number of shares of Common
Stock available at any time for the granting of Options or Stock Appreciation Rights,
there shall be deducted from the total number of reserved shares of Common Stock the
number of shares of Common Stock in respect of which Options have been granted pursuant to
the Plan that are still outstanding or have been exercised. The shares of Common Stock to
be issued upon the exercise of Options or Stock Appreciation Rights granted pursuant to
the Plan shall be made available from the authorized and unissued shares of Common Stock.
If for any reason shares of Common Stock as to which an Option has been granted cease to
be subject to purchase thereunder, then such shares of Common Stock again shall be
available for issuance pursuant to the exercise of Options or Stock Appreciation Rights
pursuant to the Plan. Except as provided in Section 5:03, however, the aggregate number of
shares of Common Stock that may be issued upon the exercise of Options and Stock
Appreciation Rights pursuant to the Plan shall not exceed 10,400,000 shares and no more
than 10,400,000 Stock Appreciation Rights shall be granted pursuant to the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Proceeds from the purchase of shares of Common Stock upon the exercise of Options granted
pursuant to the Plan shall be used for the general business purposes of the Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Subject to the provisions of Section 10:01, in the event of reorganization,
recapitalization, stock split, stock dividend, combination of shares of Common Stock,
merger, consolidation, share exchange, acquisition of property or stock, or any change in
the capital structure of the Corporation, the Committee shall make such adjustments as may
be appropriate in the number of Options or Stock Appreciation Rights that may be granted
to an employee in any calendar year, in the number and kind of shares reserved for
purchase by executives or other key employees, in the number, kind and price of shares
covered by Options and Stock Appreciation Rights granted pursuant to the Plan but not then
exercised, and in the number of Rights, if any, granted pursuant to the Plan but not then
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A012></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 6:00 </FONT></H1>

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<A NAME=A013></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such
form and with such terms and conditions (including, without limitation, noncompete,
confidentiality or other similar provisions or provisions relating to transfer) as the
Committee from time to time may determine. The right of an Option Holder to exercise his,
her or its Option shall at all times be subject to the terms and conditions set forth in
the respective Option Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The exercise price per share for Options shall be established by the Committee at the time
of the grant of Options pursuant to the Plan and shall not be less than the Fair Market
Value of a share of Common Stock on the date on which the Option is granted. If the
Committee does not establish a specific exercise price per share at the time of grant, the
exercise price per share shall be equal to the Fair Market Value of a share of Common
Stock on the date of grant of the Options. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option, subject to the other limitations set forth in the Plan, may extend for a
period of up to 10 years from the date on which it is granted. The term of each Option
shall be determined by the Committee at the time of grant of the Option, provided that if
no term is established by the Committee the term of the Option shall be 10 years from the
date on which it is granted. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-4-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of shares of Common Stock subject
to each Option shall be divided into four installments of 25% each. The first installment
shall be exercisable 12 months after the date the Option was granted, and each succeeding
installment shall be exercisable 12 months after the date the immediately preceding
installment became exercisable. If an Option Holder does not purchase the full number of
shares of Common Stock that he, she or it at any time has become entitled to purchase, the
Option Holder may purchase all or any part of those shares of Common Stock at any
subsequent time during the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options shall be nontransferable and nonassignable, except that (i) Options may be
transferred by testamentary instrument or by the laws of descent and distribution, and
(ii) subject to the terms and conditions of the Option Agreement or any other terms and
conditions imposed by the Committee from time to time, Options may be transferred in
accordance with the terms and conditions provided in Section 6:12 if the applicable Option
Agreement or other action of the Committee expressly provides that the Options are
transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Option (including any Option transferred in accordance with the terms and conditions
provided in Section 6:12) and all rights thereunder shall terminate effective at the close
of business on the date the Initial Holder ceases to be a regular, full-time employee of
the Corporation or any of its subsidiaries, except (i) to the extent previously exercised,
(ii) as provided in Sections 6:07, 6:08, and 6:09, and (iii) in the case of involuntary
termination of employment, for a period of 30 days thereafter the Option Holder shall be
entitled to exercise that portion of the Option that was exercisable at the close of
business on the date the Initial Holder ceased to be a regular, full-time employee of the
Corporation or any of its subsidiaries, provided that in no event may any Option be
exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In the event an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii)&nbsp;takes a
leave of absence from the Corporation or any of its subsidiaries for personal reasons or
as a result of entry into the armed forces of the United States, or any of the departments
or agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Option Agreement as it may deem
appropriate under the circumstances, including accelerating the time previously granted
Options may be exercised and extending the time following the Initial Holder&#146;s
termination of employment during which the Option Holder is entitled to purchase the
shares of Common Stock subject to such Options, provided that in no event may any Option
be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Option without the Option having
been exercised in full, (i)&nbsp;the executor or administrator of his or her estate or the
person who inherits the right to exercise the Option by bequest or inheritance in the
event the Initial Holder was the Option Holder at the date of death or (ii)&nbsp;the
Option Holder in the event the Option had been transferred in accordance with the terms
and conditions provided in Section 6:12, shall have the right within three years of the
Initial Holder&#146;s death to purchase the number of shares of Common Stock that the
deceased Initial Holder (or Option Holder, as the case may be) was entitled to purchase at
the date of death, after which the Option shall lapse, provided that in no event may any
Option be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without his or her Option having been
exercised in full and (i)&nbsp;the Initial Holder is 62 years of age or older, or (ii) the
Initial Holder has been employed by the Corporation or any of its subsidiaries for at
least 10 years and the Initial Holder&#146;s age plus years of such employment total not
less than 55 years, then such Initial Holder (or the Option Holder in the event the Option
had been transferred in accordance with the terms and conditions provided in Section 6:12)
shall have the right within three years of the Initial Holder&#146;s termination of
employment to purchase the number of shares of Common Stock that the Initial Holder (or
Option Holder, as the case may be) was entitled to purchase at the date of termination,
after which the </FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-5-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Option shall lapse, provided that in no event may any Option be exercised
after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of an Option pursuant to the Plan shall not constitute or be evidence of any
agreement or understanding, express or implied, on the part of the Corporation or any of
its subsidiaries to employ the Initial Holder for any specified period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the general terms and conditions set forth in this Article 6:00 in respect
of Options granted pursuant to the Plan, Incentive Stock Options granted pursuant to the
Plan shall be subject to the following additional terms and conditions: </FONT></TD>
</TR>
</TABLE>
<BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=80%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The aggregate fair market value (determined at the time the Incentive Stock
                    Option is granted) of the shares of Common Stock in respect of which
                    &#147;incentive stock options&#148; are exercisable for the first time by the
                    Option Holder during any calendar year (under all such plans of the Corporation
                    and its subsidiaries) shall not exceed $100,000; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Agreement in respect of an Incentive Stock Option may contain any
                    other terms and conditions specified by the Board of Directors that are not
                    inconsistent with the Plan, except that such terms and conditions must be
                    consistent with the requirements for &#147;incentive stock options&#148; under
                    Section 422 of the Code; and </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Incentive Stock Options shall not be transferable in accordance with the terms
                    and conditions provided in Section 6:12. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Nonqualified Stock Option or in an
amendment or supplement to a previous grant, that some or all of the Nonqualified Stock
Options granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Option Agreement, as it may be
amended from time to time, expressly so provides or the Committee otherwise designates the
Option as transferable, (ii) the transfer by the Initial Holder is a bona fide gift
without consideration, (iii) the transfer is irrevocable, (iv) the Initial Holder and any
such transferee provides such documentation or other information concerning the transfer
or the transferee as the Committee or any employee of the Corporation acting on behalf of
the Committee may from time to time request, and (v) the Initial Holder or the Option
Holder complies with all of the terms and conditions (including, without limitation, any
further restrictions or limitations) included in the Option Agreement. Any Nonqualified
Stock Option transferred in accordance with the terms and conditions provided in this
Section 6:12 shall continue to be subject to the same terms and conditions that were
applicable to such Nonqualified Stock Option prior to the transfer. Notwithstanding any
other provisions of the Plan, the Corporation shall not be required to honor any exercise
of an Option by an Immediate Family Member of an Option transferred in accordance with the
terms and conditions provided in this Section 6:12 unless and until payment or provision
for payment of any applicable withholding taxes has been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A014></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 7:00 </FONT></H1>

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<A NAME=A015></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder (or other person or persons, if any, entitled to exercise an Option
hereunder) desiring to exercise an Option granted pursuant to the Plan as to all or part
of the shares of Common Stock covered by the Option shall (i) notify either the
Corporation at its principal office at 701 East Joppa Road, Towson, Maryland 21286, or the
third party retained by the Corporation to administer the Plan to that effect, specifying
the number of shares of Common Stock to be purchased and the method of payment therefor,
and (ii) make payment or provision for payment for the shares of Common Stock so purchased
in accordance with this Article 7:00. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
 Payment or provision for payment shall be made as follows: </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-6-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall deliver to the Corporation at the address set forth in
                    Section 7:01 United States currency in an amount equal to the aggregate purchase
                    price of the shares of Common Stock as to which such exercise relates; or </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall tender to the Corporation shares of Common Stock already
                    owned by the Option Holder that, together with any cash tendered therewith, have
                    an aggregate fair market value (determined based on the Fair Market Value of a
                    share of Common Stock on the date the notice set forth in Section 7:01 is
                    received by the Corporation) equal to the aggregate purchase price of the shares
                    of Common Stock as to which such exercise relates; or </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                           <TD ALIGN=RIGHT WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The Option Holder shall deliver irrevocable instructions to a broker to deliver
                    promptly to the Corporation the amount of sale or loan proceeds necessary to pay
                    the aggregate purchase price of the shares of Common Stock as to which such
                    exercise relates and to sell the shares of Common Stock to be issued upon
                    exercise of the Option and deliver the cash proceeds less commissions and
                    brokerage fees to the Option Holder or to deliver the remaining shares of Common
                    Stock to the Option Holder. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding
the foregoing provisions, the Committee, in granting Options pursuant to the Plan, may
limit the methods in which an Option may be exercised by any person and, in processing any
purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the
method of exercise selected by the Option Holder (other than the method of exercise set
forth in Section 7:02(a)) if, (A) in the opinion of counsel to the Corporation,
(i)&nbsp;the Initial Holder or the Option Holder is or within the six months preceding
such exercise was subject to reporting under Section 16(a) of the Exchange Act and (ii)
there is a substantial likelihood that the method of exercise selected by the Option
Holder would subject the Initial Holder or the Option Holder to a substantial risk of
liability under Section&nbsp;16 of the Exchange Act, (B)&nbsp;in the opinion of the
Committee, the method of exercise could have an adverse tax or accounting effect to the
Corporation, or (C) in the opinion of counsel to the Corporation, the method of exercise
selected by the Option Holder would subject the Corporation to a risk of liability under
the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the alternative methods of exercise set forth in Section 7:02, holders of
Nonqualified Stock Options shall be entitled, at or prior to the time the notice provided
for in Section 7:01 is provided to the Corporation, to elect to have the Corporation
withhold from the shares of Common Stock to be delivered upon exercise of the Nonqualified
Stock Option that number of shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section 7:01 is
received by the Corporation) necessary to satisfy any withholding taxes attributable to
the exercise of the Nonqualified Stock Option. The maximum number of shares that an Option
Holder may elect to have withheld from the shares of Common Stock otherwise deliverable
upon exercise shall be the number of shares that have an aggregate fair market value
(based on the Fair Market Value of a share of Common Stock on the date of exercise) equal
to the dollar amount of the minimum statutory withholding for federal, state, and local
taxes, including payroll taxes, payable by the Option Holder. Alternatively, such holder
of a Nonqualified Stock Option may elect to deliver previously owned shares of Common
Stock (which shares have been held for at least six months) upon exercise of the
Nonqualified Stock Option to satisfy any withholding taxes attributable to the exercise of
the Nonqualified Stock Option. Notwithstanding the foregoing provisions, the Committee may
include in the Option Agreement relating to any such Nonqualified Stock Option provisions
limiting or eliminating the Option Holder&#146;s ability to pay his or her withholding tax
obligation by withholding or delivering shares of Common Stock or, if no such provisions
are included in the Option Agreement but in the opinion of the Committee such withholding
or delivery of shares could have an adverse tax or accounting effect to the Corporation,
at or prior to exercise of the Nonqualified Stock Option the Committee may so limit or
eliminate the Option Holder&#146;s ability to pay his or her withholding tax obligation
with shares of Common Stock. Notwithstanding the foregoing provisions, a holder of a
Nonqualified Stock Option may not elect any of the methods of satisfying his or her
withholding tax obligation in respect of any exercise if, in </FONT></TD>
</TR>
</TABLE>
<BR>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-7-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>





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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
the opinion of counsel to the
Corporation, (i) the Initial Holder or the holder of the Nonqualified Stock Option is or
within the six months preceding such exercise was subject to reporting under Section 16(a)
of the Exchange Act and (ii) there is a substantial likelihood that the election or timing
of the election would subject the Initial Holder or the holder of the Nonqualified Stock
Option to a substantial risk of liability under Section 16 of the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder at any time may elect in writing to abandon an Option in respect of all
or part of the number of shares of Common Stock as to which the Option shall not have been
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder shall have none of the rights of a stockholder of the Corporation until
the shares of Common Stock covered by the Option are issued upon exercise of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A016></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 8:00 </FONT></H1>

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<A NAME=A017></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Stock Appreciation Rights </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right granted pursuant to the Plan shall be evidenced by a Stock
Appreciation Right Agreement in such form and with such terms and conditions (including,
without limitation, noncompete, confidentiality or other similar provisions or provisions
relating to transfer) as the Committee from time to time may determine. Notwithstanding
the foregoing provision, Stock Appreciation Rights granted in tandem with a related Option
shall be evidenced by the Option Agreement in respect of the related Option. The right of
a Stock Appreciation Right Holder to exercise his, her or its Stock Appreciation Right
shall at all times be subject to the terms and conditions set forth in the respective
Stock Appreciation Right Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right shall entitle the holder, subject to the terms and
conditions of the Plan, to receive upon exercise of the Stock Appreciation Right an
amount, payable in cash or shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section&nbsp;9:01 is
received by the Corporation), equal to the Fair Market Value of a share of Common Stock on
the date of receipt by the Corporation of the notice required by Section&nbsp;9:01 less
the Stock Appreciation Right Base Price. Notwithstanding the foregoing provision, each
Stock Appreciation Right that is granted in tandem with a related Option shall entitle the
holder, subject to the terms and conditions of the Plan, to surrender to the Corporation
for cancellation all or a portion of the related Option, but only to the extent such Stock
Appreciation Right and related Option then are exercisable, and to be paid therefor an
amount, payable in cash or shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section&nbsp;9:01 is
received by the Corporation), equal to the Fair Market Value of a share of Common Stock on
the date of receipt by the Corporation of the notice required by Section&nbsp;9:01 less
the Stock Appreciation Right Base Price. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right, subject to the other limitations set forth in the Plan, may
extend for a period of up to 10 years from the date on which it is granted. The term of
each Stock Appreciation Right shall be determined by the Committee at the time of grant of
the Stock Appreciation Right, provided that if no term is established by the Committee the
term of the Stock Appreciation Right shall be 10 years from the date on which it is
granted. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of Stock Appreciation Rights
granted pursuant to each Stock Appreciation Right Agreement shall be divided into four
installments of 25% each. The first installment shall be exercisable 12 months after the
date the Stock Appreciation Right was granted, and each succeeding installment shall be
exercisable 12 months after the date the immediately preceding installment became
exercisable. If a Stock Appreciation Right Holder does not exercise the Stock Appreciation
Right to the extent that he, she or it at any time has become entitled to exercise the
Stock Appreciation Right, the Stock Appreciation Right Holder may exercise all or any part
of the Stock Appreciation Right at any subsequent time during the term of the Stock
Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-8-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Stock Appreciation Rights shall be nontransferable and nonassignable, except that (i)
Stock Appreciation Rights may be transferred by testamentary instrument or by the laws of
descent and distribution, and (ii) subject to the terms and conditions of the Stock
Appreciation Right Agreement or any other terms and conditions imposed by the Committee
from time to time, Stock Appreciation Rights may be transferred in accordance with the
terms and conditions provided in Section 8:11 if the applicable Stock Appreciation Right
Agreement or other action of the Committee expressly provides that the Stock Appreciation
Rights are transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Stock Appreciation Rights (including any Stock Appreciation Rights transferred in
accordance with the terms and conditions provided in Section 8:11) and all rights
thereunder shall terminate effective as of the close of business on the date the Initial
Holder ceases to be a regular, full-time employee of the Corporation or any of its
subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections
8:07, 8:08, and 8:09, and (iii) in the case of involuntary termination of employment, for
a period of 30 days thereafter the Stock Appreciation Right Holder shall be entitled to
exercise that portion of each Stock Appreciation Right that was exercisable at the close
of business on the date the Initial Holder ceased to be a regular, full-time employee of
the Corporation or any of its subsidiaries. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In the event an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii)&nbsp;takes a
leave of absence from the Corporation or any of its subsidiaries for personal reasons or
as a result of entry into the armed forces of the United States, or any of the departments
or agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Stock Appreciation Right Agreement
as it may deem appropriate under the circumstances, including accelerating the time
previously granted Stock Appreciation Rights may be exercised and extending the time
following the Initial Holder&#146;s termination of employment during which the Stock
Appreciation Right Holder is entitled to exercise the Stock Appreciation Rights, provided
that in no event may any Stock Appreciation Right be exercised after the expiration of the
term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Stock Appreciation Right without
the Stock Appreciation Right having been exercised in full, (i) the executor or
administrator of his or her estate or the person who inherits the right to exercise the
Stock Appreciation Right by bequest or inheritance in the event the Initial Holder was the
Stock Appreciation Right Holder at the date of death or (ii) the Stock Appreciation Right
Holder in the event the Stock Appreciation Right had been transferred in accordance with
the terms and conditions provided in Section 8:11, shall have the right within three years
of the Initial Holder&#146;s death to exercise the Stock Appreciation Rights that the
Initial Holder (or Stock Appreciation Right Holder, as the case may be) was entitled to
purchase at the date of death, after which the Stock Appreciation Right shall lapse,
provided that in no event may any Stock Appreciation Right be exercised after the
expiration of the term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without his or her Stock Appreciation
Right having been exercised in full and (i) the Initial Holder is 62 years of age or
older, or (ii) the Initial Holder has been employed by the Corporation or any of its
subsidiaries for at least 10 years and the Initial Holder&#146;s age plus years of such
employment total not less than 55 years, then such Initial Holder (or the Stock
Appreciation Right Holder in the event the Stock Appreciation Right had been transferred
in accordance with the terms and conditions provided in Section 8:11) shall have the right
within three years of the Initial Holder&#146;s termination of employment to exercise the
Stock Appreciation Rights that the Initial Holder (or Stock Appreciation Right Holder, as
the case may be) was entitled to exercise at the date of termination, after which the
Stock Appreciation Right shall lapse, provided that in no event may any Stock Appreciation
Right be exercised after the expiration of the term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-9-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of a Stock Appreciation Right pursuant to the Plan shall not constitute or be
evidence of any agreement or understanding, expressed or implied, on the part of the
Corporation or any of its subsidiaries to employ the Initial Holder for any specified
period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Stock Appreciation Right or in an
amendment or supplement to a previous grant, that some or all of the Stock Appreciation
Rights granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Stock Appreciation Right
Agreement, as it may be amended from time to time, expressly so provides or the Committee
otherwise designates the Stock Appreciation Right as transferable, (ii) the transfer by
the Initial Holder is a bona fide gift without consideration, (iii)&nbsp;the transfer is
irrevocable, (iv) the Initial Holder and any such transferee provides such documentation
or other information concerning the transfer or the transferee as the Committee or any
employee of the Corporation acting on behalf of the Committee may from time to time
request, and (v)&nbsp;the Initial Holder or the Stock Appreciation Right Holder complies
with all of the terms and conditions (including, without limitation, any further
restrictions or limitations) included in the Stock Appreciation Right Agreement. Any Stock
Appreciation Right transferred in accordance with the terms and conditions provided in
this Section 8:11 shall continue to be subject to the same terms and conditions that were
applicable to such Stock Appreciation Right prior to the transfer. Notwithstanding any
other provisions of the Plan, the Corporation shall not be required to honor any exercise
of a Stock Appreciation Right by an Immediate Family Member of a Stock Appreciation Right
transferred in accordance with the terms and conditions provided in this Section 8:11
unless and until payment or provision for payment of any applicable withholding taxes has
been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A018></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 9:00 </FONT></H1>

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<A NAME=A019></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Stock Appreciation Rights </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A Stock Appreciation Right Holder (or other person or persons, if any, entitled to
exercise a Stock Appreciation Right hereunder) desiring to exercise a Stock Appreciation
Right granted pursuant to the Plan shall notify the Corporation in writing at its
principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect,
specifying the number of Stock Appreciation Rights to be exercised. Such written notice
may be given by means of a facsimile transmission. If a facsimile transmission is used,
the Stock Appreciation Right Holder should mail the original executed copy of the written
notice to the Corporation promptly thereafter. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee in its sole and absolute discretion shall determine whether a Stock
Appreciation Right shall be settled upon exercise in cash or in shares of Common Stock.
The Committee, in making such a determination, may from time to time adopt general
guidelines or determinations as to whether Stock Appreciation Rights shall be settled in
cash or in shares of Common Stock. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A020></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 10:00 </FONT></H1>

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<A NAME=A021></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Limited Stock
Appreciation Rights </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding any other provision of the Plan, the Committee, in its sole and absolute
discretion, may grant Limited Stock Appreciation Rights entitling Option Holders to
receive, in connection with a Change in Control (as defined in Section 10:02), a cash
payment in cancellation of all of their Options that are outstanding on the date the
Change in Control occurs (whether or not such Options are then presently exercisable),
which payment shall be equal to the number of shares covered by the cancelled Options
multiplied by the excess over the exercise price of the Options of the higher of the
(i)&nbsp;Fair Market Value of a share of Common Stock on the date of the Change in Control
or (ii)&nbsp;the highest per share price paid for the shares of Common Stock in connection
with the Change in Control (with the value of any noncash consideration paid in connection
with the Change in Control to be determined by the Committee in its sole and absolute
discretion and if the Committee, in its sole and absolute discretion, determines that such
valuation will comply with Section 409A of the </FONT></TD>
</TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-10-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Code). For purposes of this Section 10:01
as well as the other provisions of this Plan, once an Option or portion of an Option has
terminated, lapsed or expired, or has been abandoned, in accordance with the provisions of
the Plan, the Option (or the portion of the Option) that has terminated, lapsed or
expired, or has been abandoned, shall cease to be outstanding. Limited Stock Appreciation
Rights shall not be exercisable at the discretion of the Option Holder but shall
automatically be exercised upon a Change in Control. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A &#147;Change in Control&#148; shall mean a change in control of the Corporation of a
nature that would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Exchange Act, whether or not the Corporation is in
fact required to comply therewith, provided that, without limitation, such a change in
control shall be deemed to have occurred if (A) any &#147;person&#148; (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Corporation or any of
its subsidiaries, or a corporation owned, directly or indirectly, by the stockholders of
the Corporation in substantially the same proportions as their ownership of stock of the
Corporation, is or becomes the &#147;beneficial owner&#148; (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Corporation
representing 20% or more of the combined voting power of the Corporation&#146;s then
outstanding securities; or (B)&nbsp;during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board of Directors and any
new director (other than a director designated by a person who has entered into an
agreement with the Corporation to effect a transaction described in clauses (A) or (D) of
this Section 10.02) whose election by the Board of Directors or nomination for election by
the Corporation&#146;s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for any reason
to constitute a majority thereof; (C) the Corporation enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control; or (D) the
stockholders of the Corporation approve a merger, share exchange or consolidation of the
Corporation with any other corporation, other than a merger, share exchange or
consolidation that would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least 60% of the
combined voting power of the voting securities of the Corporation or such surviving entity
outstanding immediately after such merger, share exchange or consolidation, or the
stockholders of the Corporation approve a plan of complete liquidation of the Corporation
or an agreement for the sale or disposition by the Corporation of all or substantially all
the Corporation&#146;s assets. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Limited Stock Appreciation Rights shall be nontransferable and nonassignable, except that
Limited Stock Appreciation Rights shall automatically be transferred and assigned in
tandem with a transfer of the related Options in accordance with Section 6:05. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A022></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 11:00 </FONT></H1>

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<A NAME=A023></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amendments and
Discontinuance of the Plan </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Board of Directors shall have the right at any time and from time to time to amend,
modify, or discontinue the Plan provided that, except as provided in Section 5:03, no such
amendment, modification, or discontinuance of the Plan shall (i) revoke or alter the terms
of any valid Option, Stock Appreciation Right, or Limited Stock Appreciation Right
previously granted pursuant to the Plan, (ii) increase the number of shares of Common
Stock to be reserved for issuance and sale pursuant to Options or Stock Appreciation
Rights granted pursuant to the Plan, (iii) decrease the price determined pursuant to the
provisions of Section 6:02 or increase the amount of cash or shares of Common Stock that a
Stock Appreciation Right Holder is entitled to receive upon exercise of a Stock
Appreciation Right, (iv) change the class of employee to whom Options or Stock
Appreciation Rights may be granted pursuant to the Plan, or (v) provide for Options or
Stock Appreciation Rights exercisable more than 10 years after the date granted. If an
amendment would (i) materially increase </FONT></TD>
</TR>
</TABLE>
<BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-11-</FONT></P>
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<DIV STYLE="page-break-after:always"></DIV>


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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
the benefits accruing to participants under the
Plan, (ii) materially increase the aggregate number of securities that may be issued under
the Plan, or (iii) materially modify the requirements as to eligibility for participation
in the Plan, then to the extent required by applicable law or deemed necessary or
advisable by the Committee or the Board of Directors, the amendment shall be subject to
stockholder approval. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 12:00 </FONT></H1>

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<A NAME=A025></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan Subject to
Governmental Laws and Regulations </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan and the grant and exercise of Options, Stock Appreciation Rights, and Limited
Stock Appreciation Rights pursuant to the Plan shall be subject to all applicable
governmental laws and regulations. Notwithstanding any other provision of the Plan to the
contrary, the Board of Directors may in its sole and absolute discretion make such changes
in the Plan as may be required to conform the Plan to such laws and regulations. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A026></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 13:00 </FONT></H1>

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<A NAME=A027></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Duration of the Plan </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=85%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No Option or Stock Appreciation Right shall be granted pursuant to the Plan after the
close of business on February 13, 2006. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-12-</FONT></P>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>6
<FILENAME>form10k12312005f.htm
<DESCRIPTION>EXHIBIT 10(G)
<TEXT>
<HTML>
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<TITLE></TITLE>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(g)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
2003 STOCK OPTION PLAN </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The proper execution of the duties
and responsibilities of the executives and other key employees of The Black&nbsp;&amp;
Decker Corporation and its subsidiaries is a vital factor in the continued growth and
success of the Corporation. Toward this end, it is necessary to attract and retain
effective and capable employees to assume positions that contribute materially to the
successful operation of the business of the Corporation. It will benefit the Corporation,
therefore, to bind the interests of these persons more closely to its own interests by
offering them an attractive opportunity to acquire a proprietary interest in the
Corporation and thereby provide them with added incentive to remain in its employ and to
increase the prosperity, growth, and earnings of the Corporation. This stock option plan
will serve these purposes. </FONT></P>

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<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 1:00 </FONT></H1>

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<A NAME=A003></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Definitions </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The following terms wherever used
herein shall have the meanings set forth below. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Board of Directors&#148; shall mean the Board of Directors of the Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Change in Control&#148; shall have the meaning provided in Section 10:02 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Code&#148; shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Committee&#148; shall mean the Compensation Committee of the Board of Directors. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Common Stock&#148; shall mean the shares of common stock,  par value $.50 per share, of the Corporation.</FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Corporation&#148; shall mean The Black &amp; Decker Corporation.</FONT></TD>
</TR>
</TABLE>
<BR>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Exchange Act&#148; shall mean the Securities Exchange Act of 1934, as amended.</FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Fair Market Value of a share of Common Stock&#148; shall mean the average
of the high and low sale price per share of Common Stock as finally reported in the New
York Stock Exchange Composite Transactions for the New York Stock Exchange, or if shares
of Common Stock are not sold on such date, the average of the high and low sale price per
share of Common Stock as finally reported in the New York Stock Exchange Composite
Transactions for the New York Stock Exchange for the most recent prior date on which
shares of Common Stock were sold. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Immediate Family Member&#148; shall mean each of (i)&nbsp;the children,
step children or grandchildren of the Initial Holder, (ii) the spouse or any parent of the
Initial Holder, (iii) any trust solely for the benefit of any such family members, and
(iv) any partnership or other entity in which such family members are the only partners or
other equity holders. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Incentive Stock Option&#148; shall mean any Option granted pursuant to the
Plan that is designated as an Incentive Stock Option and that satisfies the requirements
of Section 422(b) of the Code. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Initial Holder,&#148; with respect to an Option or Right granted under the
Plan, shall mean the executive or other key employee of the Corporation granted the Option
or Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Limited Stock Appreciation Right&#148; shall mean a limited tandem stock
appreciation right that entitles the holder to receive cash upon a Change in Control
pursuant to Article 10:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2></FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:13 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Non-Qualified Stock Option&#148; shall mean any Option granted pursuant to
the Plan that is not an Incentive Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:14 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option&#148; or &#147;Stock Option&#148; shall mean a right granted
pursuant to the Plan to purchase shares of Common Stock, and shall include the terms
Incentive Stock Option and Non-Qualified Stock Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:15 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Agreement&#148; shall mean the written agreement representing
Options granted pursuant to the Plan as contemplated by Article&nbsp;6:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:16 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Option Holder&#148; shall mean the Initial Holder so long as he or she
holds an Option initially granted to the Initial Holder, and thereafter shall mean the
beneficiary or the Immediate Family Member to whom the Option has been transferred in
accordance with Section&nbsp;6:05 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:17 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Plan&#148; shall mean The Black&nbsp;&amp; Decker 2003 Stock Option Plan as
approved by the Board of Directors on February 13, 2003, and adopted by the stockholders
of the Corporation at the 2003 Annual Meeting of Stockholders, as the same may be amended
from time to time. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:18 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Rights&#148; shall include Stock Appreciation Rights and Limited Stock Appreciation Rights. </FONT></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:19 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Section 162(m) Regulations&#148; shall mean the regulations adopted
pursuant to Section 162(m) of the Code. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:20 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right&#148; shall mean a right to receive cash or shares
of Common Stock pursuant to Article 8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:21 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Agreement&#148; shall mean the written agreement
representing Stock Appreciation Rights granted pursuant to the Plan as contemplated by
Article&nbsp;8:00 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:22 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Base Price&#148; shall mean the base price for
determining the value of a Stock Appreciation Right under Section 8:02 of the Plan, which
Stock Appreciation Right Base Price shall be established by the Committee at the time of
the grant of Stock Appreciation Rights pursuant to the Plan and shall not be less than the
Fair Market Value of a share of Common Stock on the date of grant. If the Committee does
not establish a specific Stock Appreciation Right Base Price at the time of grant, the
Stock Appreciation Right Base Price shall be equal to the Fair Market Value of a share of
Common Stock on the date of grant of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:23 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;Stock Appreciation Right Holder&#148; shall mean the Initial Holder so long
as he or she holds a Stock Appreciation Right initially granted to the Initial Holder, and
thereafter shall mean the beneficiary or the Immediate Family Member to whom the Stock
Appreciation Right has been transferred in accordance with Section&nbsp;8:05 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1:24 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The term &#147;subsidiary&#148; or &#147;subsidiaries&#148; shall mean a corporation,
partnership, limited liability company, joint venture, or other legal entity of which the
Corporation, either directly or together with any other subsidiary of the Corporation,
owns more than 50% of the voting power in the election of directors or their equivalents. </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<A NAME=A005></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 2:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A006></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Effective Date of the
Plan </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan shall become effective upon stockholder approval, provided that such approval is
received on or before May 31, 2003, and provided further that the Committee may grant
Options or Rights pursuant to the Plan prior to stockholder approval if such Options or
Rights by their terms are contingent upon subsequent stockholder approval of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<A NAME=A007></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 3:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A008></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Administration </FONT></H1>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
    The Plan shall be administered by the Committee. </FONT></TD>
</TR>
</TABLE>
<BR>






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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may establish, from time to time and at any time, subject to the limitations
of the Plan as set forth herein, such rules and regulations and amendments and supplements
thereto as it deems necessary to comply with applicable law and regulation and for the
proper administration of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee shall from time to time determine the names of those executives and other
key employees who, in its opinion, should receive Options or Rights, and shall determine
the numbers of shares on which Options should be granted or upon which Rights should be
based to each such person and the nature of the Options or Rights to be granted, including
without limitation whether the Options or Rights shall be transferable in accordance with
the terms and conditions provided in Section 6:12 or Section&nbsp;8:11 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options and Rights shall be granted by the Corporation only upon the prior approval of the
Committee and upon the execution of an Option Agreement or Stock Appreciation Right
Agreement between the Corporation and the Initial Holder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee&#146;s interpretation and construction of the provisions of the Plan and the
rules and regulations adopted by the Committee shall be final. No member of the Committee
or the Board of Directors shall be liable for any action taken or determination made, in
respect of the Plan, in good faith. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A009></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 4:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A010></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Participation in the
Plan </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participation in the Plan shall be limited to such executives and other key employees of
the Corporation and its subsidiaries who at the date of grant of an Option or Right are
regular, full-time employees of the Corporation or any of its subsidiaries and who shall
be designated by the Committee together with any permitted transferees in accordance with
the terms and conditions of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No member of the Board of Directors who is not also an employee shall be eligible to
participate in the Plan. No employee who owns beneficially more than 10% of the total
combined voting power of all classes of stock of the Corporation shall be eligible to
participate in the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No employee may be granted, in any calendar year, Options or Stock Appreciation Rights
exceeding 1,000,000 in the aggregate under the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A011></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 5:00 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<A NAME=A012></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Stock Subject to the
Plan </FONT></H1>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
There shall be reserved for the granting of Options or Stock Appreciation Rights pursuant
to the Plan and for issuance and sale pursuant to such Options or Stock Appreciation
Rights 5,000,000 shares of Common Stock. To determine the number of shares of Common Stock
available at any time for the granting of Options or Stock Appreciation Rights, there
shall be deducted from the total number of reserved shares of Common Stock the number of
shares of Common Stock in respect of which Options have been granted pursuant to the Plan
that are still outstanding or have been exercised. The shares of Common Stock to be issued
upon the exercise of Options or Stock Appreciation Rights granted pursuant to the Plan
shall be made available from the authorized and unissued shares of </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>3</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Common Stock. If for
any reason shares of Common Stock as to which an Option has been granted cease to be
subject to purchase thereunder, then such shares of Common Stock again shall be available
for issuance pursuant to the exercise of Options or Stock Appreciation Rights pursuant to
the Plan. Except as provided in Section 5:03 of the Plan, however, the aggregate number of
shares of Common Stock that may be issued upon the exercise of Options and Stock
Appreciation Rights pursuant to the Plan shall not exceed 5,000,000 shares and no more
than 5,000,000 Stock Appreciation Rights shall be granted pursuant to the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Proceeds from the purchase of shares of Common Stock upon the exercise of Options granted
pursuant to the Plan shall be used for the general business purposes of the Corporation. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Subject to the provisions of Section 10:01 of the Plan, in the event of reorganization,
recapitalization, stock split, stock dividend, combination of shares of Common Stock,
merger, consolidation, share exchange, acquisition of property or stock, or any change in
the capital structure of the Corporation, the Committee shall make such adjustments as may
be appropriate in the number of Options or Stock Appreciation Rights that may be granted
to an employee in any calendar year, in the number and kind of shares reserved for
purchase by executives or other key employees, in the number, kind and price of shares
covered by Options and Stock Appreciation Rights granted pursuant to the Plan but not then
exercised, and in the number of Rights, if any, granted pursuant to the Plan but not then
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A013></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 6:00 </FONT></H1>

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<A NAME=A014></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such
form and with such terms and conditions (including, without limitation, non-compete,
confidentiality or other similar provisions or provisions relating to transfer) as the
Committee from time to time may determine. The right of an Option Holder to exercise his,
her or its Option shall at all times be subject to the terms and conditions set forth in
the respective Option Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The exercise price per share for Options shall be established by the Committee at the time
of the grant of Options pursuant to the Plan and shall not be less than the Fair Market
Value of a share of Common Stock on the date on which the Option is granted. If the
Committee does not establish a specific exercise price per share at the time of grant, the
exercise price per share shall be equal to the Fair Market Value of a share of Common
Stock on the date of grant of the Options. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Option, subject to the other limitations set forth in the Plan, may extend for a
period of up to 10 years from the date on which it is granted. The term of each Option
shall be determined by the Committee at the time of grant of the Option, provided that if
no term is established by the Committee the term of the Option shall be 10 years from the
date on which it is granted. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of shares of Common Stock subject
to each Option shall be divided into four installments of 25% each. The first installment
shall be exercisable 12 months after the date the Option was granted, and each succeeding
installment shall be exercisable 12 months after the date the immediately preceding
installment became exercisable. If an Option Holder does not purchase the full number of
shares of Common Stock that he, she or it at any time has become entitled to purchase, the
Option Holder may purchase all or any part of those shares of Common Stock at any
subsequent time during the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Options shall be non-transferable and non-assignable, except that (i) Options may be
transferred by testamentary instrument or by the laws of descent and distribution, and
(ii) subject to the terms and conditions of the Option Agreement or any other terms and
conditions imposed by the Committee from time to time, Options may be transferred in
accordance with the terms and conditions provided in Section 6:12 of the Plan if the
applicable Option Agreement or other action of the Committee expressly provides that the
Options are transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Option (including any Option transferred in accordance with the terms and conditions
provided in Section 6:12 of the Plan) and all rights thereunder shall terminate effective
at the close of business on the date the Initial Holder ceases to be a regular, full-time
employee of the Corporation or any of its subsidiaries, except (i) to the extent
previously exercised, (ii) as provided in Sections 6:07, 6:08, and 6:09 of the Plan, and
(iii) in the case of involuntary termination of employment, for a period of 30 days
thereafter the Option Holder shall be entitled to exercise that portion of the Option that
was exercisable at the close of business on the date the Initial Holder ceased to be a
regular, full-time employee of the Corporation or any of its subsidiaries, provided that
in no event may any Option be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In the event an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii)&nbsp;takes a
leave of absence from the Corporation or any of its subsidiaries for personal reasons or
as a result of entry into the armed forces of the United States, or any of the departments
or agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Option Agreement as it may deem
appropriate under the circumstances, including accelerating the time previously granted
Options may be exercised and extending the time following the Initial Holder&#146;s
termination of employment during which the Option Holder is entitled to purchase the
shares of Common Stock subject to such Options, provided that in no event may any Option
be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Option without the Option having
been exercised in full, (i)&nbsp;the executor or administrator of his or her estate or the
person who inherits the right to exercise the Option by bequest or inheritance in the
event the Initial Holder was the Option Holder at the date of death or (ii)&nbsp;the
Option Holder in the event the Option had been transferred in accordance with the terms
and conditions provided in Section 6:12 of the Plan, shall have the right within three
years of the Initial Holder&#146;s death to purchase the number of shares of Common Stock
that the deceased Initial Holder (or Option Holder, as the case may be) was entitled to
purchase at the date of death, after which the Option shall lapse, provided that in no
event may any Option be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without his or her Option having been
exercised in full and (i)&nbsp;the Initial Holder is 62 years of age or older, or (ii) the
Initial Holder has been employed by the Corporation or any of its subsidiaries for at
least 10 years and the Initial Holder&#146;s age plus years of such employment total not
less than 55 years, then such Initial Holder (or the Option Holder in the event the Option
had been transferred in accordance with the terms and conditions provided in Section 6:12
of the Plan) shall have the right within three years of the Initial Holder&#146;s
termination of employment to purchase the number of shares of Common Stock that the
Initial Holder (or Option Holder, as the case may be) was entitled to purchase at the date
of termination, after which the Option shall lapse, provided that in no event may any
Option be exercised after the expiration of the term of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of an Option pursuant to the Plan shall not constitute or be evidence of any
agreement or understanding, express or implied, on the part of the Corporation or any of
its subsidiaries to employ the Initial Holder for any specified period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the general terms and conditions set forth in this Article 6:00 in respect
of Options granted pursuant to the Plan, Incentive Stock Options granted pursuant to the
Plan shall be subject to the following additional terms and conditions: </FONT></TD>
</TR>
</TABLE>
<BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The aggregate fair market value (determined at the time the Incentive Stock
               Option is granted) of the shares of Common Stock in respect of which
               &#147;incentive stock options&#148; under Section 422 of the Code are
               exercisable for the first time by the Option Holder during any calendar year
               (under all such plans of the Corporation and its subsidiaries) shall not exceed
               $100,000; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>5</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The Option Agreement in respect of an Incentive Stock Option may contain any
               other terms and conditions specified by the Board of Directors that are not
               inconsistent with the Plan, except that such terms and conditions must be
               consistent with the requirements for &#147;incentive stock options&#148; under
               Section 422 of the Code; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Incentive Stock Options shall not be transferable in accordance with the terms
               and conditions provided in Section 6:12 of the Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6:12 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Non-Qualified Stock Option or in an
amendment or supplement to a previous grant, that some or all of the Non-Qualified Stock
Options granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Option Agreement, as it may be
amended from time to time, expressly so provides or the Committee otherwise designates the
Option as transferable, (ii) the transfer by the Initial Holder is a bona fide gift
without consideration, (iii) the transfer is irrevocable, (iv) the Initial Holder and any
such transferee provides such documentation or other information concerning the transfer
or the transferee as the Committee or any employee of the Corporation acting on behalf of
the Committee may from time to time request, and (v) the Initial Holder or the Option
Holder complies with all of the terms and conditions (including, without limitation, any
further restrictions or limitations) included in the Option Agreement. Any Non-Qualified
Stock Option transferred in accordance with the terms and conditions provided in this
Section 6:12 shall continue to be subject to the same terms and conditions that were
applicable to such Non-Qualified Stock Option prior to the transfer. Notwithstanding any
other provisions of the Plan, the Corporation shall not be required to honor any exercise
of an Option by an Immediate Family Member of an Option transferred in accordance with the
terms and conditions provided in this Section 6:12 unless and until payment or provision
for payment of any applicable withholding taxes has been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A015></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 7:00 </FONT></H1>

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<A NAME=A016></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Options </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder (or other person or persons, if any, entitled to exercise an Option
hereunder) desiring to exercise an Option granted pursuant to the Plan as to all or part
of the shares of Common Stock covered by the Option shall (i) notify either the
Corporation at its principal office at 701 East Joppa Road, Towson, Maryland 21286, or the
third party retained by the Corporation to administer the Plan to that effect, specifying
the number of shares of Common Stock to be purchased and the method of payment therefor,
and (ii) make payment or provision for payment for the shares of Common Stock so purchased
in accordance with this Article 7:00. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Payment or provision for payment shall be made as follows: </FONT></TD>
</TR>
</TABLE>
<BR>









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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The Option Holder shall deliver to the Corporation at the address set forth in
               Section 7:01 of the Plan United States currency in an amount equal to the
               aggregate purchase price of the shares of Common Stock as to which such exercise
               relates; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The Option Holder shall tender to the Corporation shares of Common Stock already
               owned by the Option Holder that, together with any cash tendered therewith, have
               an aggregate fair market value (determined based on the Fair Market Value of a
               share of Common Stock on the date the notice set forth in Section 7:01 of the
               Plan is received by the Corporation) equal to the aggregate purchase price of
               the shares of Common Stock as to which such exercise relates; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The Option Holder shall deliver irrevocable instructions to a broker to deliver
               promptly to the Corporation the amount of sale or loan proceeds necessary to pay
               the aggregate purchase price of the shares of Common Stock as to which such
               exercise relates and to sell the shares of Common Stock to be issued upon
               exercise of the Option and deliver the cash proceeds less commissions and
               brokerage fees to the Option Holder or to deliver the remaining shares of Common
               Stock to the Option Holder. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>6</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding
the foregoing provisions, the Committee, in granting Options pursuant to the Plan, may
limit the methods in which an Option may be exercised by any person and, in processing any
purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the
method of exercise selected by the Option Holder (other than the method of exercise set
forth in Section 7:02(a) of the Plan) if, (A) in the opinion of counsel to the
Corporation, (i)&nbsp;the Initial Holder or the Option Holder is or within the six months
preceding such exercise was subject to reporting under Section 16(a) of the Exchange Act
and (ii) there is a substantial likelihood that the method of exercise selected by the
Option Holder would subject the Initial Holder or the Option Holder to a substantial risk
of liability under Section&nbsp;16 of the Exchange Act, (B)&nbsp;in the opinion of the
Committee, the method of exercise could have an adverse tax or accounting effect to the
Corporation, or (C) in the opinion of counsel to the Corporation, the method of exercise
selected by the Option Holder would subject the Corporation to a risk of liability under
the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
In addition to the alternative methods of exercise set forth in Section 7:02 of the Plan,
holders of Non-Qualified Stock Options shall be entitled, at or prior to the time the
notice provided for in Section 7:01 of the Plan is provided to the Corporation, to elect
to have the Corporation withhold from the shares of Common Stock to be delivered upon
exercise of the Non-Qualified Stock Option that number of shares of Common Stock
(determined based on the Fair Market Value of a share of Common Stock on the date the
notice set forth in Section 7:01 of the Plan is received by the Corporation) necessary to
satisfy any withholding taxes attributable to the exercise of the Non-Qualified Stock
Option. The maximum number of shares that an Option Holder may elect to have withheld from
the shares of Common Stock otherwise deliverable upon exercise shall be the number of
shares that have an aggregate fair market value (based on the Fair Market Value of a share
of Common Stock on the date of exercise) equal to the dollar amount of the minimum
statutory withholding for federal, state, and local taxes, including payroll taxes,
payable by the Option Holder. Alternatively, such holder of a Non-Qualified Stock Option
may elect to deliver previously owned shares of Common Stock (which shares have been held
for at least six months) upon exercise of the Non-Qualified Stock Option to satisfy any
withholding taxes attributable to the exercise of the Non-Qualified Stock Option.
Notwithstanding the foregoing provisions, the Committee may include in the Option
Agreement relating to any such Non-Qualified Stock Option provisions limiting or
eliminating the Option Holder&#146;s ability to pay his or her withholding tax obligation
by withholding or delivering shares of Common Stock or, if no such provisions are included
in the Option Agreement but in the opinion of the Committee such withholding or delivery
of shares could have an adverse tax or accounting effect to the Corporation, at or prior
to exercise of the Non-Qualified Stock Option the Committee may so limit or eliminate the
Option Holder&#146;s ability to pay his or her withholding tax obligation with shares of
Common Stock. Notwithstanding the foregoing provisions, a holder of a Non-Qualified Stock
Option may not elect any of the methods of satisfying his or her withholding tax
obligation in respect of any exercise if, in the opinion of counsel to the Corporation,
(i) the Initial Holder or the holder of the Non-Qualified Stock Option is or within the
six months preceding such exercise was subject to reporting under Section 16(a) of the
Exchange Act and (ii) there is a substantial likelihood that the election or timing of the
election would subject the Initial Holder or the holder of the Non-Qualified Stock Option
to a substantial risk of liability under Section 16 of the Exchange Act. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder at any time may elect in writing to abandon an Option in respect of all
or part of the number of shares of Common Stock as to which the Option shall not have been
exercised. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
An Option Holder shall have none of the rights of a stockholder of the Corporation until
the shares of Common Stock covered by the Option are issued upon exercise of the Option. </FONT></TD>
</TR>
</TABLE>
<BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>7</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
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<A NAME=A017></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 8:00 </FONT></H1>

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<A NAME=A018></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Terms and Conditions
of Stock Appreciation Rights </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right granted pursuant to the Plan shall be evidenced by a Stock
Appreciation Right Agreement in such form and with such terms and conditions (including,
without limitation, non-compete, confidentiality or other similar provisions or provisions
relating to transfer) as the Committee from time to time may determine. Notwithstanding
the foregoing provision, Stock Appreciation Rights granted in tandem with a related Option
shall be evidenced by the Option Agreement in respect of the related Option. The right of
a Stock Appreciation Right Holder to exercise his, her or its Stock Appreciation Right
shall at all times be subject to the terms and conditions set forth in the respective
Stock Appreciation Right Agreement. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right shall entitle the holder, subject to the terms and
conditions of the Plan, to receive upon exercise of the Stock Appreciation Right an
amount, payable in cash or shares of Common Stock (determined based on the Fair Market
Value of a share of Common Stock on the date the notice set forth in Section&nbsp;9:01 of
the Plan is received by the Corporation), equal to the Fair Market Value of a share of
Common Stock on the date of receipt by the Corporation of the notice required by
Section&nbsp;9:01 of the Plan less the Stock Appreciation Right Base Price.
Notwithstanding the foregoing provision, each Stock Appreciation Right that is granted in
tandem with a related Option shall entitle the holder, subject to the terms and conditions
of the Plan, to surrender to the Corporation for cancellation all or a portion of the
related Option, but only to the extent such Stock Appreciation Right and related Option
then are exercisable, and to be paid therefor an amount, payable in cash or shares of
Common Stock (determined based on the Fair Market Value of a share of Common Stock on the
date the notice set forth in Section&nbsp;9:01 of the Plan is received by the
Corporation), equal to the Fair Market Value of a share of Common Stock on the date of
receipt by the Corporation of the notice required by Section&nbsp;9:01 of the Plan less
the Stock Appreciation Right Base Price. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Each Stock Appreciation Right, subject to the other limitations set forth in the Plan, may
extend for a period of up to 10 years from the date on which it is granted. The term of
each Stock Appreciation Right shall be determined by the Committee at the time of grant of
the Stock Appreciation Right, provided that if no term is established by the Committee the
term of the Stock Appreciation Right shall be 10 years from the date on which it is
granted. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:04 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Unless otherwise provided by the Committee, the number of Stock Appreciation Rights
granted pursuant to each Stock Appreciation Right Agreement shall be divided into four
installments of 25% each. The first installment shall be exercisable 12 months after the
date the Stock Appreciation Right was granted, and each succeeding installment shall be
exercisable 12 months after the date the immediately preceding installment became
exercisable. If a Stock Appreciation Right Holder does not exercise the Stock Appreciation
Right to the extent that he, she or it at any time has become entitled to exercise the
Stock Appreciation Right, the Stock Appreciation Right Holder may exercise all or any part
of the Stock Appreciation Right at any subsequent time during the term of the Stock
Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:05 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Stock Appreciation Rights shall be non-transferable and non-assignable, except that (i)
Stock Appreciation Rights may be transferred by testamentary instrument or by the laws of
descent and distribution, and (ii) subject to the terms and conditions of the Stock
Appreciation Right Agreement or any other terms and conditions imposed by the Committee
from time to time, Stock Appreciation Rights may be transferred in accordance with the
terms and conditions provided in Section 8:11 of the Plan if the applicable Stock
Appreciation Right Agreement or other action of the Committee expressly provides that the
Stock Appreciation Rights are transferable. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:06 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Upon voluntary or involuntary termination of an Initial Holder&#146;s employment, his or
her Stock Appreciation Rights (including any Stock Appreciation Rights transferred in
accordance with the terms and conditions provided in Section 8:11 of the Plan) and all
rights thereunder shall terminate effective as of the close of business on the date the
Initial Holder ceases to be a regular, full-time </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>8</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
employee of the Corporation or any of its
subsidiaries, except (i) to the extent previously exercised, (ii) as provided in Sections
8:07, 8:08, and 8:09 of the Plan, and (iii) in the case of involuntary termination of
employment, for a period of 30 days thereafter the Stock Appreciation Right Holder shall
be entitled to exercise that portion of each Stock Appreciation Right that was exercisable
at the close of business on the date the Initial Holder ceased to be a regular, full-time
employee of the Corporation or any of its subsidiaries. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:07 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder (i) ceases to be an executive or other key employee of the
Corporation or any of its subsidiaries due to involuntary termination, (ii)&nbsp;takes a
leave of absence from the Corporation or any of its subsidiaries for personal reasons or
as a result of entry into the armed forces of the United States, or any of the departments
or agencies of the United States government, or (iii) terminates employment by reason of
illness, disability, or other special circumstance, the Committee may consider his or her
case and may take such action in respect of the related Stock Appreciation Right Agreement
as it may deem appropriate under the circumstances, including accelerating the time
previously granted Stock Appreciation Rights may be exercised and extending the time
following the Initial Holder&#146;s termination of employment during which the Stock
Appreciation Right Holder is entitled to exercise the Stock Appreciation Rights, provided
that in no event may any Stock Appreciation Right be exercised after the expiration of the
term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:08 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder dies during the term of his or her Stock Appreciation Right without
the Stock Appreciation Right having been exercised in full, (i) the executor or
administrator of his or her estate or the person who inherits the right to exercise the
Stock Appreciation Right by bequest or inheritance in the event the Initial Holder was the
Stock Appreciation Right Holder at the date of death or (ii) the Stock Appreciation Right
Holder in the event the Stock Appreciation Right had been transferred in accordance with
the terms and conditions provided in Section 8:11 of the Plan, shall have the right within
three years of the Initial Holder&#146;s death to exercise the Stock Appreciation Rights
that the Initial Holder (or Stock Appreciation Right Holder, as the case may be) was
entitled to purchase at the date of death, after which the Stock Appreciation Right shall
lapse, provided that in no event may any Stock Appreciation Right be exercised after the
expiration of the term of the Stock Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:09 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If an Initial Holder&#146;s employment is terminated without his or her Stock Appreciation
Right having been exercised in full and (i) the Initial Holder is 62 years of age or
older, or (ii) the Initial Holder has been employed by the Corporation or any of its
subsidiaries for at least 10 years and the Initial Holder&#146;s age plus years of such
employment total not less than 55 years, then such Initial Holder (or the Stock
Appreciation Right Holder in the event the Stock Appreciation Right had been transferred
in accordance with the terms and conditions provided in Section 8:11 of the Plan) shall
have the right within three years of the Initial Holder&#146;s termination of employment
to exercise the Stock Appreciation Rights that the Initial Holder (or Stock Appreciation
Right Holder, as the case may be) was entitled to exercise at the date of termination,
after which the Stock Appreciation Right shall lapse, provided that in no event may any
Stock Appreciation Right be exercised after the expiration of the term of the Stock
Appreciation Right. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:10 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The granting of a Stock Appreciation Right pursuant to the Plan shall not constitute or be
evidence of any agreement or understanding, expressed or implied, on the part of the
Corporation or any of its subsidiaries to employ the Initial Holder for any specified
period. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8:11 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee may provide, in the original grant of a Stock Appreciation Right or in an
amendment or supplement to a previous grant, that some or all of the Stock Appreciation
Rights granted under the Plan are transferable by the Initial Holder to an Immediate
Family Member of the Initial Holder, provided that (i) the Stock Appreciation Right
Agreement, as it may be amended from time to time, expressly so provides or the Committee
otherwise designates the Stock Appreciation Right as transferable, (ii) the transfer by
the Initial Holder is a bona fide gift without consideration, (iii)&nbsp;the transfer is
irrevocable, (iv) the Initial Holder and any such transferee provides such documentation
or other information concerning the transfer or the transferee as the Committee or any
employee of the Corporation acting on behalf of the Committee may from time to time
request, and (v)&nbsp;the Initial Holder or the Stock Appreciation Right Holder complies
with all of the terms and conditions (including, without limitation, any further
restrictions or limitations) included in the Stock </FONT></TD>
</TR>
</TABLE>
<BR>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>9</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Appreciation Right Agreement. Any Stock
Appreciation Right transferred in accordance with the terms and conditions provided in
this Section 8:11 shall continue to be subject to the same terms and conditions that were
applicable to such Stock Appreciation Right prior to the transfer. Notwithstanding any
other provisions of the Plan, the Corporation shall not be required to honor any exercise
of a Stock Appreciation Right by an Immediate Family Member of a Stock Appreciation Right
transferred in accordance with the terms and conditions provided in this Section 8:11
unless and until payment or provision for payment of any applicable withholding taxes has
been made. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A019></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 9:00 </FONT></H1>

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<A NAME=A020></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Methods of Exercise of
Stock Appreciation Rights </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A Stock Appreciation Right Holder (or other person or persons, if any, entitled to
exercise a Stock Appreciation Right hereunder) desiring to exercise a Stock Appreciation
Right granted pursuant to the Plan shall notify the Corporation in writing at its
principal office at 701 East Joppa Road, Towson, Maryland 21286, to that effect,
specifying the number of Stock Appreciation Rights to be exercised. Such written notice
may be given by means of a facsimile transmission. If a facsimile transmission is used,
the Stock Appreciation Right Holder should mail the original executed copy of the written
notice to the Corporation promptly thereafter. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Committee in its sole and absolute discretion shall determine whether a Stock
Appreciation Right shall be settled upon exercise in cash or in shares of Common Stock.
The Committee, in making such a determination, may from time to time adopt general
guidelines or determinations as to whether Stock Appreciation Rights shall be settled in
cash or in shares of Common Stock. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A021></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 10:00 </FONT></H1>

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<A NAME=A022></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Limited Stock
Appreciation Rights </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Notwithstanding any other provision of the Plan, the Committee, in its sole and absolute
discretion, may grant Limited Stock Appreciation Rights entitling Option Holders to
receive, in connection with a Change in Control, a cash payment in cancellation of all of
their Options that are outstanding on the date the Change in Control occurs (whether or
not such Options are then presently exercisable), which payment shall be equal to the
number of shares covered by the cancelled Options multiplied by the excess over the
exercise price of the Options of the higher of the (i)&nbsp;Fair Market Value of a share
of Common Stock on the date of the Change in Control or (ii)&nbsp;the highest per share
price paid for the shares of Common Stock in connection with the Change in Control (with
the value of any non-cash consideration paid in connection with the Change in Control to
be determined by the Committee in its sole and absolute discretion and if the Committee,
in its sole and absolute discretion, determines that such valuation will comply with
Section 409A of the Code). For purposes of this Section 10:01 as well as the other
provisions of this Plan, once an Option or portion of an Option has terminated, lapsed or
expired, or has been abandoned, in accordance with the provisions of the Plan, the Option
(or the portion of the Option) that has terminated, lapsed or expired, or has been
abandoned, shall cease to be outstanding. Limited Stock Appreciation Rights shall not be
exercisable at the discretion of the Option Holder but shall automatically be exercised
upon a Change in Control. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:02 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
A &#147;Change in Control&#148; shall mean a change in control of the Corporation of a
nature that would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Exchange Act, whether or not the Corporation is in
fact required to comply therewith, provided that, without limitation, such a change in
control shall be deemed to have occurred if (i) any &#147;person&#148; (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Corporation or any of
its subsidiaries, or a corporation owned, directly or indirectly, by the stockholders of
the Corporation in substantially the same proportions as their ownership of stock of the
Corporation, is or becomes the &#147;beneficial owner&#148; (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Corporation
representing 20% or more of the combined voting power of the </FONT></TD>
</TR>
</TABLE>
<BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>10</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Corporation&#146;s then
outstanding securities; (ii)&nbsp;during any period of two consecutive years, individuals
who at the beginning of such period constitute the Board of Directors and any new director
(other than a director designated by a person who has entered into an agreement with the
Corporation to effect a transaction described in clauses (i) or (iv) of this Section
10.02) whose election by the Board of Directors or nomination for election by the
Corporation&#146;s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for any reason
to constitute a majority thereof; (iii) the Corporation enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control; or (iv) the
stockholders of the Corporation approve a merger, share exchange or consolidation of the
Corporation with any other corporation or entity, other than a merger, share exchange or
consolidation that would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least 60% of the
combined voting power of the voting securities of the Corporation or such surviving entity
outstanding immediately after the merger, share exchange or consolidation, or the
stockholders of the Corporation approve a plan of complete liquidation of the Corporation
or an agreement for the sale or disposition by the Corporation of all or substantially all
the Corporation&#146;s assets. </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10:03 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Limited Stock Appreciation Rights shall be non-transferable and non-assignable, except
that Limited Stock Appreciation Rights shall automatically be transferred and assigned in
tandem with a transfer of the related Options in accordance with Section 6:05 of the Plan. </FONT></TD>
</TR>
</TABLE>
<BR>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 11:00 </FONT></H1>

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<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amendments and
Discontinuance of the Plan </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Board of Directors shall have the right at any time and from time to time to amend,
modify, or discontinue the Plan provided that, except as provided in Section 5:03 of the
Plan, no such amendment, modification, or discontinuance of the Plan shall (i) revoke or
alter the terms of any valid Option, Stock Appreciation Right, or Limited Stock
Appreciation Right previously granted pursuant to the Plan, (ii) increase the number of
shares of Common Stock to be reserved for issuance and sale pursuant to Options or Stock
Appreciation Rights granted pursuant to the Plan, (iii) decrease the price determined
pursuant to the provisions of Section 6:02 of the Plan or increase the amount of cash or
shares of Common Stock that a Stock Appreciation Right Holder is entitled to receive upon
exercise of a Stock Appreciation Right, (iv) change the class of employee to whom Options
or Stock Appreciation Rights may be granted pursuant to the Plan, (v) provide for Options
or Stock Appreciation Rights exercisable more than 10 years after the date granted or (vi)
increase the number of Options or Stock Appreciation Rights that may be granted to an
employee in any calendar year under Section 4.03 of the Plan. If an amendment would (i)
materially increase the benefits accruing to participants under the Plan, (ii) materially
increase the aggregate number of securities that may be issued under the Plan, or (iii)
materially modify the requirements as to eligibility for participation in the Plan, then
to the extent required by applicable law or deemed necessary or advisable by the Committee
or the Board of Directors, the amendment shall be subject to stockholder approval. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A025></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 12:00 </FONT></H1>

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<A NAME=A026></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan Subject to
Governmental Laws and Regulations </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The Plan and the grant and exercise of Options, Stock Appreciation Rights, and Limited
Stock Appreciation Rights pursuant to the Plan shall be subject to all applicable
governmental laws and regulations. Notwithstanding any other provision of the Plan to the
contrary, the Board of Directors may in its sole and absolute discretion make such changes
in the Plan as may be required to conform the Plan to such laws and regulations. </FONT></TD>
</TR>
</TABLE>
<BR>


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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 13:00 </FONT></H1>

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<A NAME=A028></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Duration of the Plan </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13:01 </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No Option or Stock Appreciation Right shall be granted pursuant to the Plan after the
close of business on April 29, 2013. </FONT></TD>
</TR>
</TABLE>
<BR>


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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>7
<FILENAME>form10k12312005g.htm
<DESCRIPTION>EXHIBIT 10(I)
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(i)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>THE BLACK &amp; DECKER
PERFORMANCE EQUITY PLAN</U> </FONT></H1>

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<A NAME=A002></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purpose </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
purpose of The Black &amp; Decker Performance Equity Plan (the &#147;Plan&#148;) is to
attract and retain key employees of The Black &amp; Decker Corporation (the
&#147;Corporation&#148;) and its Subsidiaries, to motivate those employees to put forth
maximum efforts for the long-term success of the business, and to encourage ownership of
the Corporation&#146;s Stock by them. </FONT></P>

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<A NAME=A003></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Definitions </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following definitions are applicable to the Plan: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Code&#148; shall mean the Internal Revenue Code of 1986, as amended. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Committee&#148; shall mean the Compensation Committee of the
          Corporation&#146;s Board of Directors or such other committee of the Board
          composed of not less than three members as the Board of Directors shall from
          time to time appoint to administer the Plan. All members of the Committee shall
          be members of the Board of Directors of the Corporation who are not eligible to
          participate in the Plan and who are (i) disinterested persons as defined in Rule
          16b-3 adopted pursuant to the Exchange Act, (ii) outside directors as defined in
          the Section 162(m) Regulations, and (iii) independent directors as defined in
          the New York Stock Exchange&#146;s corporate governance rules and the
          Corporation&#146;s Corporate Governance Policies and Procedures Statement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Designated Beneficiary&#148; shall mean the beneficiary designated by the
          Participant, in a manner determined by the Committee, to receive shares of Stock
          or other payments due the Participant in the event of the Participant&#146;s
          death, or in the absence of an effective designation by the Participant, the
          Participant&#146;s surviving spouse, or, if there is no surviving spouse, the
          Participant&#146;s estate. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Employee&#148; shall mean a regular full-time salaried employee of the
          Corporation or of a Subsidiary. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Exchange Act&#148; shall mean the Securities Exchange Act of 1934, as
          amended. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Executive Officer&#148; shall mean an executive officer of the Corporation
          within the meaning of Rule 3b-7 promulgated under the Exchange Act and a
          &#147;covered employee&#148; as defined by the Section 162(m) Regulations. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Fiscal Year&#148; shall mean the fiscal year of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Participant&#148; shall mean an Employee who is selected by the Committee
          to participate in the Plan pursuant to Section 5. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Performance Goals&#148; shall mean the performance objective or objectives
          relating to, in whole or in part, the performance of the Corporation or any
          Subsidiary, group, division, or operating unit of the Corporation or any
          Subsidiary during a Performance Period. With respect to a Participant who is an
          Executive Officer, the performance objective or objectives shall be based on one
          of, or a combination of, the following factors: the market price of the Stock at
          the close of business on the last business day of the Performance Period,
          increases in the market price of the Stock during the Performance Period, the
          earnings for the Performance Period or any year or years in the Performance
          Period (either before taxes, before interest and taxes, before depreciation,
          amortization, interest and taxes, or after all of the foregoing), the earnings
          per share for the Performance Period or any year or years in the Performance
          Period, or, as to the Corporation or any Subsidiary, group, division or
          operating unit thereof, the average annual return on equity or net assets for
          the Performance Period or the return on equity or net assets for a specified
          year or </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
years in the Performance Period, the average annual gross margin or cost
          of goods sold for the Performance Period or the gross margin or cost of goods
          sold for a specified year or years in the Performance Period, or the average
          annual cash flow from operations or free cash flow for the Performance Period or
          the cash flow from operations or free cash flow for a specified year or years in
          the Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Performance Period&#148; shall mean with respect to each grant of
          Performance Shares a period of two to three Fiscal Years. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Performance Shares&#148; shall mean a grant pursuant to Sections 5 and 7
          of an award in the form of shares of Common Stock or units equivalent thereto. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(l)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Section 162(m) Regulations&#148; shall mean the regulations adopted
          pursuant to Section 162(m) of the Code, as such regulations may be amended from
          time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(m)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Stock&#148; shall mean the common stock, $.50 par value, of the
          Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(n)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Subsidiary&#148; shall mean any business entity in which the Corporation,
          directly or indirectly, owns 50 percent or more of the total combined voting
          power of all classes of stock or other equity interests. </FONT></P>

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<A NAME=A004></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administration </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Plan shall be administered by the Committee. The Committee shall have full power to
establish the form and terms and conditions (including, without limitation, noncompete,
confidentiality or similar provisions) of the Performance Share Agreement that shall
represent the grant of Performance Shares to a Participant hereunder, to construe and
interpret the Plan and to establish and amend rules and regulations for its
administration. All actions taken and decisions made by the Committee pursuant to the
provisions of the Plan shall be binding and conclusive on all persons for all purposes,
including but not limited to Participants and their legal representatives and
beneficiaries. The rights of a Participant shall at all times be subject to the terms and
conditions set forth in the respective Performance Share Agreement. </FONT></P>

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<A NAME=A005></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Maximum
Amount Available for Grants </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The maximum number of Performance Shares that may be granted and the maximum
          number of shares of Stock that may be issued under the Plan is 2,500,000,
          subject to adjustment as provided in Section 11. If Performance Shares are
          forfeited under the Plan, they and any related shares of Stock shall again be
          available for grant and issuance under the Plan. Subject to Section 10, if
          Performance Shares are paid in cash rather than in shares of Stock, such
          Performance Shares and any related shares of Stock shall not be available for
          grant and issuance. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Shares of Stock delivered under the Plan shall be made available from authorized
          but unissued shares. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          With respect to each Performance Period beginning on or after January 1, 1996,
          the maximum number of Performance Shares that may be granted, and the maximum
          number of shares of Stock that may be issued, to any Participant shall be
          75,000. </FONT></P>

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<A NAME=A006></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Participation; Grants </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee shall from time to time make grants of Performance Shares to Participants
selected from among those Employees who, in the opinion of the Committee, have the
capacity to contribute in substantial measure to the successful performance of the
Corporation and its Subsidiaries. In making grants, the Committee may take into account a
Participant&#146;s level of responsibility, rate of compensation, individual performance
and contribution, and such other criteria as it deems appropriate. If an Employee becomes
a Participant after the commencement of a Performance Period, the number of Performance
Shares granted, if any, may be prorated for the length of time remaining in the
Performance Period. With</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>respect to any Employee who is or becomes an Executive Officer,
the Committee may not designate the Employee a Participant more than 90 days after the
commencement of a Performance Period. The Committee may not grant Performance Shares to
any member of the Committee. </FONT></P>

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<A NAME=A007></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Performance
Goals </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee shall establish Performance Goals for each Performance Period on the basis of
such criteria, and to accomplish such objectives, as the Committee may from time to time
determine. The Committee shall also establish a schedule or schedules for the Performance
Period setting forth the percentage of the Performance Shares granted that will be earned
or forfeited based on the percentages of the Performance Goals for the period that are
actually achieved or exceeded. To provide Participants with additional motivation, the
Committee, in its discretion, may provide for the issuance to individual Participants,
where Performance Goals in excess of a target are achieved or exceeded, of additional,
fully vested and unrestricted Performance Shares not to exceed 50% of the Performance
Shares granted for the Performance Period; provided, however, that with respect to
Performance Periods beginning on or after January 1, 1996, if such an additional grant is
made to an Executive Officer, the number of additional Performance Shares to be granted to
the Executive Officer shall be fixed by the Committee within 90 days of the commencement
of the Performance Period, and the grant of additional Performance Shares to the Executive
Officer shall be contingent upon the attainment of the Performance Goals established, in
writing, by the Committee within 90 days of the commencement of the Performance Period. In
setting Performance Goals, the Committee may use return on equity, earnings growth,
revenue growth, peer comparisons or such other measures of performance in such manner as
it deems appropriate; provided, however, that for Performance Periods beginning on or
after January 1, 1996, Performance Goals established with respect to a Participant who is
an Executive Officer shall be based on one of, or a combination of, the factors set forth
in the definition of Performance Goals. The Committee shall establish Performance Goals
before, or as soon as practicable after, the commencement of the Performance Period;
provided that with respect to a Participant who is an Executive Officer the Performance
Goals shall be established in writing by the Committee not later than 90 days after the
commencement of the Performance Period. During the Performance Period and until such time
thereafter as payment is made in accordance with Section 8(b), the Committee shall have
the authority to adjust upward or downward the Performance Goals or the measure or
measures of performance in such manner as it deems appropriate to reflect unusual,
extraordinary or nonrecurring events, changes in applicable accounting rules or principles
or in the Corporation&#146;s methods of accounting, changes in applicable tax law or
regulations, changes in Fiscal Year or such other factors as the Committee may determine,
including authority to determine that all or any portion of any Performance Shares
otherwise earned for the Performance Period have not been earned (even if applicable
Performance Goals originally established have been met). Notwithstanding the preceding
sentence, with respect to a Performance Period beginning on or after January 1, 1996, the
Committee shall have no such authority to the extent that the existence or exercise of the
authority would result in any awards made to such Participants for the Performance Period
not being excluded from covered compensation under the Section 162(m) Regulations as a
result of the qualified performance based compensation exclusion in the Section 162(m)
Regulations. </FONT></P>

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<A NAME=A008></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 7. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
Performance Period </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Performance Shares may be granted in the form of either shares of Stock or units
          equivalent thereto as described in this Section 7. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If Performance Shares are granted in the form of shares of Stock, certificates
          representing the Performance Shares shall be issued in the name of the
          Participant, but shall be retained in the custody of the Corporation until the
          expiration of the Performance Period and the determination of the number of
          shares, if any, that are to be forfeited pursuant to the terms of the grant.
          During the Performance Period (and until such time thereafter as payment is made
          in accordance with Section 8(b)), the Performance Shares shall not be
          transferable, except to the extent rights may pass upon the death of the
          Participant to a Designated Beneficiary pursuant to the terms of the Plan. The
          Participant shall have the right during the Performance Period to receive all
          cash dividends and other cash distributions with respect to the Performance
          Shares granted to the Participant that have not previously been forfeited and to
          vote such </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>shares. Any distribution of shares of stock or other securities or
          property made with respect to Performance Shares held in the name of a
          Participant shall be treated as part of the Performance Shares of the
          Participant and shall be subject to forfeiture and all the other limitations and
          restrictions imposed upon such Performance Shares. Upon the expiration of the
          Performance Period or the occurrence of any other event that may give rise to
          forfeiture under the Plan, the Corporation may defer payment of dividends on
          Performance Shares until a determination is made as to the number of such
          shares, if any, to be forfeited, and no further dividends shall be paid with
          respect to forfeited shares after the date of the forfeiture (regardless of
          whether the record date of the dividend is before or after the date of the
          forfeiture). The Participant shall retain the right to vote all Performance
          Shares until a determination has been made by the Committee as to whether such
          shares, or a part thereof, have been forfeited. In the event of the death of the
          Participant, his Designated Beneficiary shall have the same right to receive
          cash dividends and other cash distributions with respect to the Performance
          Shares that are not forfeited and to vote such shares as the Participant would
          have had if he had survived. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If Performance Shares are granted in the form of units equivalent to shares of
          Stock, no certificates shall be issued with respect to the units, but the
          Corporation shall maintain a bookkeeping account in the name of the Participant
          to which the units shall relate and the units shall otherwise be treated in a
          comparable manner as if the Participant had been awarded shares of Stock (except
          that no voting rights or other stock ownership rights shall apply to the units).
          Each such unit shall represent the right to receive one share of Stock or a cash
          payment of equivalent value at the time, in the manner and subject to the
          restrictions set forth in the Plan. If, during the Performance Period, cash
          dividends or other cash distributions are paid with respect to shares of Stock,
          the Corporation shall pay to the Participant in cash an amount equal to the cash
          dividends or cash distributions that he would have received if the Performance
          Shares had been granted in the form of shares of Stock rather than units
          equivalent thereto. If, during the Performance Period, shares of stock or other
          securities or property are distributed with respect to the Stock, additional
          units equivalent to such shares, securities or property shall be added to the
          Participant&#146;s bookkeeping account as additional units and shall be subject
          to forfeiture and all other limitations and restrictions imposed upon the
          related units. Upon the expiration of the Performance Period or the occurrence
          of any other event that may give rise to forfeiture under the Plan, the
          Corporation may defer payment of dividend equivalents on units of Performance
          Shares until a determination is made as to the number of such units, if any, to
          be forfeited, and no further dividend equivalents shall be paid with respect to
          forfeited units after the date of the forfeiture (regardless of whether the
          record date of the dividend is before or after the date of the forfeiture). In
          the event of the death of the Participant, his Designated Beneficiary shall have
          the same right to receive cash payments equivalent to cash dividends and other
          cash distributions with respect to the units of Performance Shares that are not
          forfeited as the Participant would have had if he had survived. A Participant
          (or Designated Beneficiary) shall have no right to or interest in any specific
          assets of the Corporation or any of its Subsidiaries by reason of the
          establishment of the bookkeeping account described in this Section 7(c), and
          shall have only the right of an unsecured creditor of the Corporation with
          respect to amounts payable from such account under this Plan. </FONT></P>

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<A NAME=A009></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          As soon as practicable after the end of a Performance Period, except as
          permitted in Section 8(c), the Committee shall determine the extent to which the
          Performance Goals have been achieved or exceeded and, on this basis, shall
          certify and declare in writing what percentages, if any, of the granted
          Performance Shares have been earned with respect to the Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          In accordance with the procedures specified by the Committee from time to time,
          payment of Performance Shares that have been earned or deemed earned shall be
          made in Stock, cash equivalent in value to the corresponding shares of Stock, or
          a combination thereof as determined by the Committee. Payment shall be made on a
          date specified by the Committee but in no event later than the last day of the
          calendar year immediately following the end of the year in which the Performance
          Shares are earned or deemed earned. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          For the first Performance Period established under the Plan (but not for any
          subsequent Performance Periods), the Committee may in its discretion establish
          interim Performance Goals applicable </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
to a Fiscal Year or Years ending prior to
          the end of the Performance Period, and provide for a portion of the Performance
          Shares granted for the Performance Period to be earned and paid out as soon as
          practicable following the end of each such Fiscal Year or Years to the extent
          such interim Performance Goals are satisfied. </FONT></P>

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<A NAME=A010></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 9. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Termination
of Employment and Forfeitures </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject
to the provisions of Section 10: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Except as otherwise provided in Section 9(c), Performance Shares that are
          granted but not earned by a Participant with respect to the Performance Period
          shall be forfeited. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Except as otherwise provided in Section 9(c) or in Section 8(c), if a
          Participant ceases to be an Employee prior to the end of the Performance Period,
          all of such Participant&#146;s Performance Shares for the Performance Period
          shall be forfeited. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If prior to the end of a Performance Period, a Participant dies or ceases to be
          an Employee by reason of (i) retirement from active employment with a right to
          receive an immediate pension benefit under the applicable pension plan of the
          Corporation or any of its Subsidiaries, (ii) extended disability (such as
          entitles the Participant to long-term disability payments under the applicable
          pension plan or long-term disability plan of the Corporation or any of its
          Subsidiaries), or (iii) for any other reason specified in each case by the
          Committee, there shall be forfeited as of the cessation of employment a number
          of Performance Shares equal to the number initially granted to the Participant
          for that Performance Period multiplied by a fraction, (i) the numerator of which
          shall be the number of full calendar months from the date of the
          Participant&#146;s cessation of employment to the end of the Performance Period,
          and (ii) the denominator of which shall be the number of months representing the
          entire Performance Period; provided, that with respect to Performance Periods
          beginning before January 1, 1996, the Committee is authorized to declare (before
          or as soon as practicable after such cessation of employment) that a lesser
          number of Performance Shares shall be forfeited as of the date of such cessation
          of employment. With respect to the Performance Shares that are not so forfeited
          as of the date of such cessation of employment, the Performance Period shall
          continue and the percentage of such remaining Performance Shares that are earned
          or forfeited shall be determined based upon the extent to which the applicable
          Performance Goals for such Performance Period have been achieved or exceeded
          (subject to the last two sentences of Section 6). Payment of Performance Shares
          that have been earned and not forfeited shall be made in accordance with Section
          6; provided, however, that no payment shall be made to a Participant who has
          ceased to be an Employee for reasons specified in this Section 9(c) earlier than
          the date that is six months and one day following such Employee&#146;s
          &#147;separation from service&#148; as defined in Section 409A of the Code and
          the regulations thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Transfer from the Corporation to a Subsidiary, from a Subsidiary to the
          Corporation, or from one Subsidiary to another Subsidiary shall not be
          considered a termination of employment. Nor shall it be considered a termination
          of employment if an Employee is placed on military or sick leave or on other
          leave of absence that is considered by the Committee as continuing intact the
          employment relationship. In those cases, the employment relationship shall be
          continued until the later of the date when the leave equals 90 days or the date
          when an Employee&#146;s right to reemployment shall no longer be guaranteed
          either by law or by contract, except that in the event active employment is not
          renewed at the end of the leave of absence, the employment relationship shall be
          deemed to have been terminated at the beginning of the leave of absence. </FONT></P>

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<A NAME=A011></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mergers,
Sales and Change of Control </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          In the case of (i) any merger, consolidation, share exchange or combination of
          the Corporation with or into another corporation (other than a merger,
          consolidation, share exchange or combination in which the Corporation is the
          surviving corporation and which does not result in the outstanding Stock being
          converted into or exchanged for different securities, cash or other property, or
          any combination thereof) or a sale of all or substantially all of the business
          or assets of the Corporation or (ii) a </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Change of Control of the Corporation, all
          Performance Periods shall be deemed to have ended as of the end of the most
          recent quarterly accounting period prior to the date of the merger,
          consolidation, share exchange, combination, sale of assets, or Change of Control
          of the Corporation, all Performance Goals to earn the maximum number of
          Performance Shares for each Performance Period shall be deemed to have been
          achieved, and the maximum number of Performance Shares (150% of the target award
          for each Performance Period) shall be deemed to have been earned and shall be
          payable in accordance with Section 8. In the event that application of the
          foregoing provisions results in more than 2,500,000 Performance Shares being
          deemed to have been earned, then notwithstanding any other provision of the Plan
          (including but not limited to the provisions of Section 4) any Performance
          Shares in excess of 2,500,000 deemed to have been earned shall be paid in cash
          equivalent in value to the corresponding shares of Stock. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Change of Control of the Corporation&#148; means any of the following: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The acquisition by any one person, or more than one person acting as a group, of
               any of the Corporation&#146;s capital stock if (A) the sum of such capital stock
               so acquired plus any of the Corporation&#146;s capital stock held by that person
               or group before the acquisition constitutes more than fifty percent (50%) of the
               total fair market value or total voting power of the outstanding capital stock
               of the Corporation, and (B) the Corporation&#146;s capital stock held by that
               person or group immediately before that acquisition constituted fifty percent
               (50%) or less of the then total fair market value or total voting power of the
               outstanding capital stock of the Corporation. An increase in the percentage of
               the Corporation&#146;s capital stock owned by any one person or persons acting
               as a group as a result of a transaction in which the Corporation acquires its
               capital stock in exchange for property will be treated as an acquisition of the
               Corporation&#146;s capital stock under this Section 10(b)(1). This Section
               10(b)(1) only applies when there is a transfer or issuance of the
               Corporation&#146;s capital stock and the Corporation&#146;s capital stock
               remains outstanding after the transaction. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The acquisition by any one person, or more than one person acting as a group,
               during the 12-month period ending on the most recent such acquisition by that
               person or group of ownership of the Corporation&#146;s capital stock possessing
               thirty-five percent (35%) or more of the total voting power of the outstanding
               capital stock of the Corporation if the capital stock of the Corporation held by
               that person or group immediately before that acquisition constituted less than
               thirty-five percent (35%) of the then total voting power of the outstanding
               capital stock of the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               A majority of the members of the Board is replaced during any 12-month period by
               directors whose appointment or election is not endorsed by a majority of the
               members of the Board prior to the date of the appointment or election, provided
               that no other corporation is the holder of a majority of the Corporation&#146;s
               capital stock. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The acquisition by any one person, or more than one person acting as a group,
               during the 12-month period ending on the most recent such acquisition by that
               person or group of assets of the Corporation that have a total gross fair market
               value equal to or more than forty percent (40%) of the total gross fair market
               value of all of the Corporation&#146;s assets immediately prior to such
               acquisition or acquisitions. For this purpose, gross fair market value means the
               value of the Corporation&#146;s assets, or the value of the assets being
               disposed of, determined without regard to any liabilities associated with those
               assets. There is no Change in Control of the Corporation under this Section
               10(b)(4) when there is a transfer to an entity that is controlled by the
               stockholders of the Corporation immediately after the transfer. A transfer of
               assets will not qualify as a Change in Control of the Corporation under this
               Section 10(b)(4) if the assets are transferred to: (i) a stockholder of the
               Corporation immediately before the transfer in exchange for or with respect to
               the Corporation&#146;s capital stock; (ii) an entity, fifty percent (50%) or
               more of the total value or voting power of which is owned, directly or
               indirectly, by the Corporation; (iii) a person, or more than one person acting
               as a group, that owns, directly or indirectly, fifty percent (50%) or more of
               the total value or voting power of all of the outstanding capital stock of the
               Corporation; or (iv) an entity, at least fifty percent (50%) of the total value
               or voting power of </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
which is owned, directly or indirectly, by a person, or more
               than one person acting as a group, that owns, directly or indirectly, fifty
               percent (50%) or more of the total value or voting power of all of the
               outstanding capital stock of the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the purpose of interpreting this definition of &#147;Change in Control of the
Corporation,&#148; the following rules apply: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Persons will be considered as acting as a group only if they are owners of a
               corporation that enters into a merger, consolidation, purchase or acquisition of
               assets, or similar business transaction with the Corporation. If a person,
               including an entity stockholder, owns capital stock of the Corporation and stock
               in the other corporation that enters into a merger, consolidation, purchase or
               acquisition of stock, or similar transaction with respect to the Corporation,
               that stockholder is considered to be acting as a group with other stockholders
               in the Corporation only to the extent of the ownership in the Corporation prior
               to the transaction giving rise to the Change in Control of the Corporation and
               not with respect to the ownership interest in the other corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Ownership shall be determined taking into account the attribution rules set
               forth in Section 318(a) of the Code. Stock underlying a vested option is
               considered owned by the option holder and non-vested stock is not considered
               owned by the option holder. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If any one person, or more than one person acting as a group, is considered to
               effectively control the Corporation as described in Sections 10(b)(2) and (3),
               the acquisition of additional control of the Corporation by the same person or
               persons is not considered to cause a change in the effective control of the
               Corporation or to cause a change in the ownership of the Corporation for the
               purposes of this definition. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Each event described in Section 10(b) is intended to constitute a change in
               ownership or effective control of the Corporation or in the ownership of a
               substantial portion of the Corporation&#146;s assets within the meaning of
               Section 409A(a)(2)(A)(v) of the Code and the IRS guidance issued thereunder, and
               this Plan shall be interpreted accordingly </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A012></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustment
of and Changes in Stock </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event of a reorganization, recapitalization, stock split, stock dividend, combination
of shares, merger, consolidation, share exchange, rights offering, distribution of assets,
or any other change in the corporate structure or capital stock of the Corporation, the
Committee shall make such adjustments, if any, as it deems appropriate in the number of
Performance Shares that have been or may be granted under the Plan, the number of shares
of Stock available for issuance under the Plan, and the Performance Goals and the number
of Performance Shares that may be earned, to reflect the change, and any adjustments so
made shall be conclusive for all purposes of the Plan. </FONT></P>

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<A NAME=A013></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Miscellaneous Provisions </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The rights or interest of a Participant or Designated Beneficiary under the Plan
          may not be assigned, encumbered or transferred until such time as payment is
          made in accordance with Section 8(b), except to the extent rights may pass upon
          the death of the Participant to a Designated Beneficiary pursuant to the terms
          of this Plan. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          No Employee or other person shall have any claim or right to be granted
          Performance Shares under the Plan. Neither the Plan nor any action taken under
          the Plan shall be construed as giving any Employee or other person any right to
          be retained in the employ of the Corporation or any of its Subsidiaries. </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Performance Shares granted or earned and cash dividends or other cash
          distribution paid under the Plan shall not be deemed compensation in determining
          the amount of any entitlement under any retirement or other employee benefit
          plan of the Corporation or any of its Subsidiaries. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Committee may adopt and apply rules that will ensure that the Corporation
          and its Subsidiaries will be able to comply with applicable provisions of any
          Federal, state or local law relating to the withholding of tax, including but
          not limited to the withholding of tax on dividends paid on Performance Shares
          and on the amount, if any, includable in income of a Participant after the
          expiration of the Performance Period. The Committee shall have the right in its
          discretion to satisfy withholding tax liability by retaining or purchasing
          Performance Shares. It is intended that the Plan comply with Section 409A of the
          Internal Revenue Code and the regulations and guidance thereunder and it shall
          be interpreted accordingly. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan shall be construed in accordance with and governed by the laws of the
          State of Maryland. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          In this Plan, whenever the context so requires, the masculine gender includes
          the feminine and a singular number includes the plural. The Section headings
          contained in this Plan are for convenience of reference only and shall not limit
          or otherwise affect the meaning or interpretation of this Plan or any of its
          terms and conditions. Unless the context clearly indicates otherwise, all
          references to Sections in this Plan are to Sections of this Plan. </FONT></P>

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<A NAME=A014></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 13. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment or
Termination </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors of the Corporation may amend, suspend or terminate the Plan at any time
and in such manner and to such extent as it deems advisable, but no amendment shall be
made without the approval of a majority of the shares represented and entitled to vote at
a duly called meeting of stockholders at which a quorum is present that would (i) increase
the number of Performance Shares that may be granted under the Plan (except as provided in
Section 11), (ii) increase the maximum number of shares of Stock available for issuance
under the Plan (except as provided in Section 11), (iii) materially increase the 50%
limitation set forth in Section 6, or (iv) change the Plan&#146;s eligibility
requirements. No amendment, suspension or termination shall impair any right theretofore
granted to any Participant, without the consent of the Participant. Notwithstanding the
foregoing, the Plan may be amended at any time, including retroactively, to conform the
Plan to the provisions and requirements of Section 409A of the Code and the regulations
and guidance thereunder, and no such amendment shall be considered prejudicial to any
interest of any Participant hereunder. </FONT></P>

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<A NAME=A015></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 14. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Effective
Date and Term of Plan </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
Performance Shares may be granted under the Plan after the date of the 2010 Annual Meeting
of Stockholders of the Corporation. </FONT></P>

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<A NAME=A016></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Indemnification of Committee </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition
to such other rights of indemnification as they may have as members of the
Corporation&#146;s Board of Directors or as members of the Committee, each member of the
Committee shall be indemnified by the Corporation against the reasonable expenses,
including attorney&#146;s fees, actually and necessarily incurred in connection with the
defense of any action, suit or proceeding, or in connection with any appeal therein, to
which he may be a party by reason of any action taken or failure to act under or in
connection with the Plan, or any Performance Shares granted thereunder, and against all
amounts paid by him in settlement thereof, provided such settlement is approved by
independent legal counsel selected by the Corporation, or paid by him in satisfaction of a
judgment in any such action, suit or proceeding except in relation to matters as to which
it shall be adjudged in such action, suit or proceeding that such Committee member is
liable for gross negligence or misconduct in his duties; provided that within 60 days
after the institution of such action, suit or proceeding, the Committee member shall in
writing offer the Corporation the opportunity, at its own expense, to handle and defend
the same. </FONT></P>

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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>form10k12312005h.htm
<DESCRIPTION>EXHIBIT 10(L)
<TEXT>

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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (l)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>THE BLACK &amp; DECKER
EXECUTIVE ANNUAL INCENTIVE PLAN</U></B> </FONT></H1>

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<A NAME=A002></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1. &nbsp;&nbsp;&nbsp;&nbsp;Purpose </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
purpose of The Black &amp; Decker Corporation Executive Annual Incentive Plan is to make a
part of the annual compensation of the Corporation&#146;s officers dependent on the
Corporation&#146;s performance and to provide rewards for performance as a competitive
incentive to their efforts on the Corporation&#146;s behalf, and thus to enhance and
reinforce the Corporation&#146;s ability to achieve its business goals. It is the
intention of the Board of Directors of the Corporation in adopting the Plan that amounts
paid to Participants under the Plan be &#147;qualified performance-based
compensation&#148; within the meaning of Section 162(m) of the Code and the Section 162(m)
Regulations. </FONT></P>

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<A NAME=A003></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2. &nbsp;&nbsp;&nbsp;&nbsp;Definitions </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Whenever
used for purposes of the Plan, the following terms have the meanings defined below, and
when the defined meaning is intended, the term is capitalized: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Award&#148; means a grant to a Participant of incentive compensation under
          the Plan. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;CEO&#148; means the Chief Executive Officer of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Code&#148; means the Internal Revenue Code of 1986, as amended from time
          to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Committee&#148; means the Compensation Committee of the Board of Directors
          of the Corporation. All members of the Committee shall be members of the Board
          of Directors of the Corporation who are not eligible to participate in the Plan
          and who are (i) disinterested persons as defined in Rule 16b-3 adopted pursuant
          to the Exchange Act, (ii) outside directors as defined in the Section 162(m)
          Regulations, and (iii) independent directors as defined in the New York Stock
          Exchange&#146;s corporate governance rules and the Corporation&#146;s Corporate
          Governance Policies and Procedures Statement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Corporation&#148; means The Black &amp; Decker Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Maximum Participant Award&#148; means, with respect to a particular
          Participant, the maximum Award payable to such Participant as determined in
          accordance with Section 6(c) of the Plan. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Participant&#148; means an employee who is an officer of the Corporation
          who has been designated to participate in the Plan. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Performance Period&#148; means the fiscal year in respect of which an
          Award is to be paid under the Plan. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Plan&#148; means The Black &amp; Decker Executive Annual Incentive Plan,
          as amended from time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Section 162(m) Regulations&#148; mean the regulations adopted pursuant to
          Section 162(m) of the Code, as amended from time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Subsidiary&#148; means any domestic or foreign corporation, at least 50%
          of the outstanding voting stock or voting power of which is beneficially owned,
          directly or indirectly, by the Corporation. </FONT></P>

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<A NAME=A004></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3. &nbsp;&nbsp;&nbsp;&nbsp;Administration </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Committee shall determine who shall be a Participant, the applicable
          performance goals for each Performance Period and the amount of any Awards paid
          under the Plan, shall construe, interpret (subject to Section 3(d) of the Plan)
          and administer the Plan, and shall adopt such rules and regulations and take
          such other action as it deems appropriate. All decisions by the Committee shall
          be final, conclusive and binding on the Corporation and each Participant, former
          Participant, beneficiary and every other interested person. The Committee may
          condition participation in the Plan by an employee upon the employee agreeing to
          certain terms and conditions of employment (including, without limitation,
          noncompete, confidentiality or similar provisions). Prior to the payment of any
          Awards under the Plan the Committee shall certify, in accordance with the
          Section 162(m) Regulations, that the performance goals in respect of the
          applicable Performance Period have been satisfied. The Committee will report
          annually to the Board of Directors of the Corporation all action taken under the
          Plan, including Awards paid. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Within 90 days of the beginning of each Performance Period (or, if earlier,
          before 25% of the period of service to which the performance goals relate has
          elapsed), the Committee shall establish or approve performance goals for the
          Performance Period. The performance goals established by the Committee shall be
          stated in terms of an objective formula or standard and shall be based on one
          of, or a combination of, the following factors: the market price of the
          Corporation&#146;s Common Stock at the close of business on the last business
          day of the Performance Period, increases in the market price of the
          Corporation&#146;s Common Stock during the Performance Period, the earnings for
          the Performance Period (either before taxes, before interest and taxes, before
          depreciation, amortization, interest and taxes, or after all of the foregoing),
          the earnings per share for the Performance Period, or, as to the Corporation or
          any subsidiary, group, division, or operating unit thereof, the return on equity
          or net assets for the Performance Period, the gross margin or cost of goods sold
          for the Performance Period, or the cash flow from operations or free cash flow
          for the Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Committee shall administer the Plan in a manner consistent with the terms
          and conditions of the Section 162(m) Regulations to enable Awards paid under the
          Plan to be &#147;qualified performance-based compensation&#148; within the
          meaning of Section 162(m) of the Code and the Section 162(m) Regulations. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          It is intended that the Plan comply with Section 409A of the Code and the
          regulations or guidance issued thereunder and it shall be interpreted
          accordingly. </FONT></P>

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<A NAME=A005></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4. &nbsp;&nbsp;&nbsp;&nbsp;Participation </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Participation in the Plan shall be limited to selected officers of the
          Corporation who the Committee has determined have a significant influence on the
          Corporation&#146;s annual corporate performance. The selection of Participants
          shall be made by the Committee within 90 days of the beginning of a Performance
          Period (or, if earlier, before 25% of the period of service to which the
          performance goals relate has elapsed) and communicated to the Participants as
          soon thereafter as practicable. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          At any time during a Performance Period the Committee may designate new
          Participants or remove officers from participation, in its sole discretion. An
          officer&#146;s participation in the Plan in any prior year or years shall not
          give the officer the right to be a Participant in any subsequent year. </FONT></P>

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<A NAME=A006></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.&nbsp;&nbsp;&nbsp;&nbsp; Awards </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          At the end of each Performance Period, the CEO shall submit a written report to
          the Committee describing the performance of the Corporation (or, if applicable,
          a business unit) relative to those performance goals previously established by
          the Committee for the Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Awards shall be made annually in accordance with the respective performance
          against the performance goals established by the Committee for the respective
          Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The decision to pay or not to pay an Award and the amount of the Award to be
          paid shall be made by the Committee based on the performance goals established
          in respect of the applicable Performance Period and in accordance with the
          Section 162(m) Regulations. Under no circumstances may the Committee make an
          Award to a Participant that exceeds the applicable Maximum Participant Award for
          the respective Performance Period. The Committee in its sole discretion may
          reduce the amount of any Award paid to a Participant below the amount of the
          Award that otherwise would be payable to the Participant upon application of the
          performance goals for the applicable Performance Period or may decide not to pay
          an Award when performance goals for the applicable Performance Periods have been
          satisfied, but under no circumstances may the Committee increase the amount of
          any Award that otherwise would be payable to the Participant upon application of
          the performance goals for the applicable Performance Period. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          With respect to each Participant, the Maximum Participant Award for a
          Performance Period shall be equal to 200% of his or her annual base salary on
          the date the Committee establishes the performance goals for the applicable
          Performance Period. Notwithstanding the foregoing, under no circumstances may
          the Maximum Participant Award for any Performance Period exceed $4 million. </FONT></P>

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<A NAME=A007></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6. &nbsp;&nbsp;&nbsp;&nbsp;Payment of Awards </FONT></H1>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Awards shall be paid as soon as practicable after the end of a Performance
          Period (but in no event later than the last day of the calendar year immediately
          following the end of the Performance Period), after audited results for the
          Performance Period are available, and after the Committee has certified that the
          applicable performance goals have been satisfied. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Awards shall be paid in cash and shall be paid in the currency in which each
          Participant&#146;s base salary is paid. </FONT></P>


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<A NAME=A008></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.&nbsp;&nbsp;&nbsp;&nbsp; Termination of
Employment </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
before an Award is actually paid to a Participant with respect to a Performance Period the
Participant ceases to be a regular, full-time employee of the Corporation or any of its
Subsidiaries for a reason other than retirement with a right to an immediate retirement
benefit, the Participant&#146;s eligibility under the Plan shall terminate and no Award
will be made. If a Participant&#146;s employment terminates at a time when the Participant
has a right to receive an immediate retirement benefit from the Corporation or any of its
Subsidiaries, the Committee may make such Award as it deems appropriate under the
circumstances; provided, however, that the Award shall not exceed the Award the
Participant would have been entitled to receive upon application of the performance goals
for the applicable Performance Period if the Participant had been employed for the entire
Performance Period times a fraction the numerator of which shall equal the number of days
the Participant was employed by the Corporation and its Subsidiaries during the
Performance Period and the denominator of which shall equal the number of days in the
Performance Period. </FONT></P>

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<A NAME=A009></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.&nbsp;&nbsp;&nbsp;&nbsp; Claim to Awards and
Employment Rights </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
officer or other person shall have any claim or right to be granted an Award under the
Plan. Neither the Plan nor any action taken hereunder shall be construed as giving any
person any right to be retained in the employ of the Corporation or a Subsidiary or
affecting the right of the Corporation and its Subsidiaries to terminate the employment of
any person at any time, for any reason and with or without notice. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
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<A NAME=A010></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.&nbsp;&nbsp;&nbsp;&nbsp; Tax Withholding </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation or a Subsidiary, as appropriate, shall have the right to deduct from all Award
payments for any Federal, State or local taxes or other similar payments required by law
to be withheld with respect to such payments. </FONT></P>

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<A NAME=A011></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10. &nbsp;&nbsp;&nbsp;&nbsp;Expenses of Plan </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
expenses of administering the Plan shall be borne by the Corporation and its Subsidiaries. </FONT></P>

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<A NAME=A012></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11.&nbsp;&nbsp;&nbsp;&nbsp; Amendment and
Termination </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors may, in its discretion, terminate, amend or modify this Plan at any
time and from time to time. The Plan may be amended at any time, including retroactively,
to conform the Plan to the provisions and requirements of Section 409A of the Code, and no
such amendment shall be considered prejudicial to any interest of any participant
thereunder. </FONT></P>

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<A NAME=A013></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12. &nbsp;&nbsp;&nbsp;&nbsp;Effective Date of
the Plan </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Plan, as amended effective January 1, 2005, shall be effective as of January 1, 1996,
provided that the Plan is approved by the stockholders of the Corporation at the 1996
Annual Meeting of Stockholders or any adjournment thereof. In the event the Plan is not
approved by the stockholders of the Corporation at the 1996 Annual Meeting of Stockholders
or any adjournment thereof, the Plan shall terminate and be of no force and effect and no
benefits shall be payable hereunder. </FONT></P>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>9
<FILENAME>form10k12312005i.htm
<DESCRIPTION>EXHIBIT 10(M)
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (m)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>THE BLACK &amp; DECKER
MANAGEMENT ANNUAL INCENTIVE PLAN</U> </FONT></H1>

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<A NAME=A002></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purpose </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
purpose of The Black &amp; Decker Corporation Management Annual Incentive Plan is to make
a part of the annual compensation of certain key management employees dependent on
individual and Corporation performance and to provide rewards for performance as a
competitive incentive to their efforts on the Corporation&#146;s behalf, and thus to
enhance and reinforce the Corporation&#146;s ability to achieve its business goals. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A003></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Definitions </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Whenever
used for purposes of the Plan, the following terms have the meanings defined below, and
when the defined meaning is intended, the term is capitalized: </FONT></TD>
</TR>
</TABLE>
<BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Award&#148; means a grant to a Participant of incentive compensation under
               the Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;CEO&#148; means the Chief Executive Officer of the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Committee&#148; means the Compensation Committee of the Board of Directors
               of the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Corporation&#148; means The Black &amp; Decker Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(e) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Participant&#148; means an employee of the Corporation or one of its
               Subsidiaries who has been designated to participate in this Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(f) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Performance Period&#148; means the fiscal year in respect of which an
               Award is to be paid under the Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(g) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Plan&#148; means The Black &amp; Decker Management Annual Incentive Plan,
               as amended from time to time. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(h) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               &#147;Subsidiary&#148; means any domestic or foreign corporation, at least 50%
               of the outstanding voting stock or voting power of which is beneficially owned,
               directly or indirectly, by the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A004></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administration </FONT></H1>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The Committee shall determine who shall be a Participant, the applicable
               performance goals for each Performance Period and the amount of any Awards paid
               under the Plan, shall construe, interpret (subject to Section 3(c) of the Plan)
               and administer the Plan, and shall adopt such rules and regulations and take
               such other action as it deems appropriate. All decisions by the Committee shall
               be final, conclusive and binding on the Corporation and each Participant, former
               Participant, beneficiary and every other interested person. The CEO or the
               Committee may condition participation in the Plan by an employee upon the
               employee agreeing to certain terms and conditions of employment (including,
               without limitation, noncompete, confidentiality or similar provisions). The
               Committee will report annually to the Board of Directors of the Corporation all
               action taken under the Plan, including Awards paid. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Within 90 days of the beginning of each Performance Period, the CEO and the
               Committee shall establish or approve performance goals for each Participant. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2></FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               It is intended that the Plan comply with Section 409A of the Internal Revenue
               Code of 1986, as amended from time to time (the &#147;Code&#148;), and the
               regulations or guidance issued thereunder and it shall be interpreted
               accordingly. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A005></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Participation </FONT></H1>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Participation in the Plan shall be limited to selected management employees who
               the Committee has determined have a significant influence on the
               Corporation&#146;s annual corporate performance. The selection of Participants
               shall be recommended by the CEO and approved by the Committee within 90 days of
               the beginning of a Performance Period and communicated to the Participants as
               soon thereafter as practicable. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               No management employee shall be a Participant in the Plan during any year in
               which he or she is a participant in any other annual incentive plan of the
               Corporation or any of its Subsidiaries, including but not limited to The Black
               &amp; Decker Executive Annual Incentive Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               At any time during a Performance Period the Committee may designate new
               Participants or remove employees from participation, in its sole discretion. An
               employee&#146;s participation in the Plan in any prior year or years shall not
               give the employee the right to be a Participant in any subsequent year. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A006></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Awards </FONT></H1>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Awards shall be made annually after consideration of the respective performance
               against the performance goals established by the Committee for the respective
               Performance Period. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               To be eligible for an Award in respect of a given Performance Period, a minimum
               of six months&#146; participation in the Plan is required for the Performance
               Period. The decision to pay or not to pay an Award and the amount of the Award
               to be paid shall be made by the Committee in its sole discretion. The Committee
               may decide to pay an Award when performance objectives have not been satisfied
               and elect not to pay an Award when performance objectives have been satisfied. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               With respect to each Participant, the maximum Award for a Performance Period
               shall be equal to the aggregate of the Participant&#146;s annual base salary at
               the beginning and at the end of the Performance Period, divided by two and
               multiplied by 55%. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A007></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment of Awards </FONT></H1>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Awards shall be paid as soon as practicable after the end of a Performance
               Period (but in no event later than the last day of the calendar year immediately
               following the end of the Performance Period) and after audited results for the
               Performance Period are available. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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                    <TD ALIGN=RIGHT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD ALIGN=LEFT WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Awards shall be paid in cash and shall be paid in the currency in which each
               Participant&#146;s base salary is paid. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
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<A NAME=A008></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Termination of
Employment </FONT></H1>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If
before an Award is actually paid to a Participant with respect to a Performance Period the
Participant ceases to be a regular full-time employee of the Corporation or any of its
Subsidiaries for a reason other than retirement with a right to an immediate retirement
benefit, the Participant&#146;s eligibility under the Plan shall terminate and no Award
will be made, except that the Committee in its sole discretion may consider whether to
make an Award to such Participant and, in the event it decides to make such an Award in
its sole discretion, shall determine the amount of the Award. If a Participant&#146;s
employment terminates at a time when the Participant has a right to receive an immediate
retirement benefit from the Corporation or any of its Subsidiaries, the Committee may make
such Award as it deems appropriate under the circumstances. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A009></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Claim to Awards and
Employment Rights </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
No
employee or other person shall have any claim or right to be granted an Award under the
Plan. Only the Committee shall have the authority to commit the Corporation to make an
Award under the Plan, and any such commitment shall be binding on the Corporation only if
in writing signed by the CEO or another duly authorized officer of the Corporation.
Neither the Plan nor any action taken hereunder shall be construed as giving any employee
any right to be retained in the employ of the Corporation or a Subsidiary or affecting the
right of the Corporation and its Subsidiaries to terminate the employment of any employee
at any time, for any reason and with or without notice. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A010></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax Withholding </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
Corporation or a Subsidiary, as appropriate, shall have the right to deduct from all Award
payments for any Federal, State or local taxes or other similar payments required by law
to be withheld with respect to such payments. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A011></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Expenses of Plan </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
expenses of administering the Plan shall be borne by the Corporation and its Subsidiaries. </FONT></P>

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<A NAME=A012></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment and
Termination </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
Board of Directors may, in its discretion, terminate, amend or modify this Plan at any
time and from time to time. The Plan may be amended at any time, including retroactively,
to conform the Plan to the provisions and requirements of Section 409A of the Code, and no
such amendment shall be considered prejudicial to any interest of any Participant
thereunder. </FONT></TD>
</TR>
</TABLE>
<BR>

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<A NAME=A013></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Effective Date of
the Plan </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Plan, as amended effective January 1, 2005, shall be effective as of January 1, 1996. </FONT></P>


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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>10
<FILENAME>form10k12312005j.htm
<DESCRIPTION>EXHIBIT 10(N)
<TEXT>
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<HEAD>
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<BR><BR><BR><BR><BR><BR><BR><BR>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (n)<BR><BR><BR><BR><BR><BR><BR><BR></B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>THE BLACK &amp; DECKER <BR>SUPPLEMENTAL
PENSION PLAN </I></B></FONT></P><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR>

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<A NAME=A002></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Amended and Restated
Effective as of<BR>January 1, 2005 </FONT></P>


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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>THE BLACK &amp; DECKER<BR>SUPPLEMENTAL PENSION PLAN</I></B> </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 1</I> &#151; <I>Purpose</I> </B></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Supplemental Pension Plan (the &#147;Prior Plan&#148;) was established
by Black &amp; Decker (U.S.) Inc., effective as of October 1, 1989, to provide certain
employees of the Black &amp; Decker Companies with benefits which would otherwise be
provided under a Defined Benefit Plan but for reductions or restrictions to such benefits
required by Federal law. Specifically, this Plan will provide Participants with
supplemental benefits to compensate for the loss of benefits that otherwise would have
been payable under a Defined Benefit Plan were it not for the maximum limitation on
benefits under section 415 of the Code and reductions in pensionable earnings due to
section 401(a)(17) of the Code and the deferral of compensation under the Executive
Deferred Compensation Plan. This Plan is to be unfunded and is maintained for the purpose
of providing deferred compensation for a select group of management or highly compensated
employees. This plan, The Black &amp; Decker Supplemental Pension Plan (the
&#147;Plan&#148;), amends and fully restates the Prior Plan, effective as of January 1,
2005. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 2</I> &#150; <I>Definitions</I> </B></FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
used in this Plan, the following terms shall have the meanings indicated: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Accrued
Pension&#148; means the benefit the Participant has accrued under a Defined Benefit Plan,
expressed as a single-life annuity payable for the Participant&#146;s life beginning at
the Participant&#146;s normal retirement date or, if later, his or her actual retirement
date, under the Defined Benefit Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Actuarial
Equivalent&#148; means a benefit of equivalent value on a specific date, computed on the
basis of the actuarial assumptions used to determine benefit equivalencies under the
applicable Defined Benefit Plan and using such other reasonable actuarial assumptions and
methods that may be adopted by the Pension Committee from time to time, in its sole
discretion, for this purpose. Notwithstanding the foregoing, in the event a Participant
has elected to receive the accelerated method of payment (5-year installments or lump sum
payment) of the present value of his or her Supplemental Pension under this Plan, the
amount of the lump sum payment or installment payments (including the Supplemental
Spouse&#146;s Death Benefit) shall be calculated using an interest rate equal to four and
one-half percent (4.5%) and the 1994 Group Annuity Reserving Table (determined on a unisex
basis and projected to 2002, all as described in <I>IRS Revenue Ruling 2001-62</I>) and
assuming that the Participant will earn no wages subject to the Social Security Act nor
further accrue any other retirement benefits after his or her Benefit Commencement Date
and that his or her Social Security retirement benefits and all other retirement benefits
will begin at the earliest date they are available after the Participant&#146;s Benefit
Commencement Date and using such other reasonable actuarial assumptions and methods that
may be adopted by the Pension Committee from time to time, in its sole discretion, for
this purpose. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Benefit
Commencement Date&#148; means the date the Participant&#146;s Supplemental Pension is to
be paid or commence to be paid and which shall be the first day of the calendar month
immediately following the later of the Participant&#146;s 55<SUP>th</SUP> birthday or the
date of his or her Separation from Service with the Company and all other Black &amp;
Decker Companies. Notwithstanding the preceding sentence, in the case of a Participant
whose Benefit Commencement Date would otherwise have occurred at any time in the 2005
calendar year and who elects during the 2005 calendar year to receive the accelerated
method of payment (5-year installments or lump sum payment) of his or her benefits, the
Benefit Commencement Date for that lump sum payment or those installment payments shall be
deemed to be the first day of the calendar month after the date that election to
accelerate is filed with the Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Beneficiary&#148;
means the beneficiary designated in accordance with Section 7 to receive the death benefit
provided under Section 6(a) in the event of a Participant&#146;s death. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Black
&amp; Decker Company&#148; means The Black &amp; Decker Corporation or any of its
affiliates and subsidiaries. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Code&#148;
means the Internal Revenue Code of 1986, as amended, and any regulations issued
thereunder. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Sub 2 Left" FSL="Default" -->
<A NAME=A006></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Company&#148;
means Black &amp; Decker (U.S.) Inc. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Defined
Benefit Plan&#148; means a defined benefit plan within the meaning of Section 3(35) of
ERISA that is sponsored by a Black &amp; Decker Company and is intended to qualify under
Section 401(a) of the Code. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;ERISA&#148;
means the Employee Retirement Income Security Act of 1974, as amended. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Executive
Deferred Compensation Plan&#148; means The Black &amp; Decker Executive Deferred
Compensation Plan or The Black &amp; Decker Supplemental Retirement Savings Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Limitations&#148;
means the maximum limitation on benefits under Section 415 of the Code and reductions in
pensionable earnings due to Section 401(a)(17) of the Code and the deferral of
compensation under the Executive Deferred Compensation Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Participant&#148;
means any employee of a Black &amp; Decker Company eligible to participate in this Plan in
accordance with Section 3. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Payment
Date&#148; means the Participant&#146;s Benefit Commencement Date or, in the case of a
Participant who qualifies as a &#147;key employee&#148; (as defined in Code Section 416(i)
without regard to paragraph (5) thereof), the first day of the calendar month immediately
following the later of the Participant&#146;s Benefit Commencement Date or the date that
is six months and one day after his or her Separation from Service with the Company and
all other Black &amp; Decker Companies. A</FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>3</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participant will be a &#147;key employee&#148;
at all times during any calendar year, only if the Participant qualified as a &#147;key
employee&#148; at any time during the 12-month period ending on August 31<SUP>st</SUP>
immediately preceding that calendar year. Notwithstanding anything to the contrary, if the
Committee reasonably determines that the making of any payment to a Participant under this
Plan will violate Federal securities laws or other applicable law, the Committee may delay
a Participant&#146;s Payment Date until the earliest date at which the Committee
determines that the making of that payment will not violate those laws. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Pension
Committee&#148; means The Black &amp; Decker (U.S.) Inc. Pension Committee. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Plan&#148;
means The Black &amp; Decker Supplemental Pension Plan, originally established effective
as of October 1, 1989 and as amended and restated effective as of January 1, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Separation
from Service&#148; means a separation from service within the meaning of Section
409A(a)(2)(A)(i) of the Code. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Supplemental
Pension&#148; means the supplemental pension benefit determined in accordance with Section
4. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;Supplemental
Spouse&#146;s Death Benefit&#148; means the pre-retirement death benefit payable to a
Participant&#146;s surviving spouse as more particularly described in Section 6(b). </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 3</I> &#150; <I>Eligibility</I> </B></FONT></P>



<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise provided under this Section 3 or by Section 10 of this Agreement, any
employee of a Black &amp; Decker Company whose benefit under any Defined Benefit Plan is
reduced because of the Limitations shall be a Participant in this Plan eligible to receive
a Supplemental Pension. If a Participant&#146;s benefit under more than one Defined
Benefit Plan is reduced because of the Limitations, the Participant shall be eligible to
receive a separate Supplemental Pension relating to each such Defined Benefit Plan, and
the provisions of this Plan shall be applied separately with respect to each such
Supplemental Pension. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 4</I> &#150; <I>Calculation of Supplemental Pension</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
Participant&#146;s Supplemental Pension relating to any Defined Benefit Plan shall be the
Actuarial Equivalent at the applicable Payment Date of the excess of: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Participant&#146;s Accrued Pension under the Defined Benefit Plan,
          calculated without regard to the Limitations; over </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Participant&#146;s Accrued Pension under the Defined Benefit Plan. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, the Supplemental Pension payable hereunder shall be reduced by the
Actuarial Equivalent of the amount of any benefit payable by a Black &amp; Decker Company,
or by a plan sponsored by a Black &amp; Decker Company, which is similarly intended to
offset the impact of any of the Limitations. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 5</I>&#150; <I>Payment
of Supplemental Pension</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Except as provided in Section 5(d), the Actuarial Equivalent of a
          Participant&#146;s Supplemental Pension as of the applicable Payment Date shall
          be paid in the form of a monthly 10-year guaranteed single life annuity for the
          Participant&#146;s life, commencing on the Participant&#146;s Payment Date, and
          providing that, in the event the Participant should die before receiving at
          least 120 of those monthly payments, the balance of those 120 monthly payments
          will continue to be paid monthly to the Participant&#146;s Beneficiary until the
          Participant and his or her Beneficiary together shall have received a total of
          120 monthly payments. Notwithstanding the preceding sentence, in the case of any
          Participant whose Benefit Commencement Date occurs prior to February 9, 2006,
          the form of payment for the Participant&#146;s benefits under this Plan shall be
          the same form as the Participant&#146;s benefits are paid under the Defined
          Benefit Plan to which the Supplemental Pension relates. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Notwithstanding anything in this Plan to the contrary, to the extent required
          under Code Section 409A, in no event shall a Participant&#146;s Supplemental
          Pension be paid or commence to be paid to him or her before the
          Participant&#146;s Payment Date and must be paid or commence to be paid to the
          Participant on his or her Payment Date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Anything to the contrary notwithstanding, a Supplemental Pension shall be
          payable only so long as and to the extent that the Limitations are applicable to
          the benefits payable to the Participant under the related Defined Benefit Plan
          and only to the extent that the Limitations reduce the amount of the benefits
          otherwise payable under the Defined Benefit Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Any Participant who, at any time during 2005, was subject to an agreement to
          provide consulting services to any Black &amp; Decker Company or who is employed
          by any of the Black &amp; Decker Companies after September 1, 2005 and whose
          base annual salary rate at that date was $200,000 or more may make an
          irrevocable election to receive as of the Participant&#146;s Payment Date, in
          lieu of the Supplemental Pension provided under this Plan, the accelerated
          payment of his or her benefits under this Plan described in Paragraphs (1) and
          (2) in this Section 5(d). That election shall be made in writing and signed by
          the Participant and must be received by the Plan Manager of The Black &amp;
          Decker Pension Plan on or before December 31, 2006. Under all circumstances,
          once received by the Plan Manager, any election under this Section 5(d) of the
          accelerated method of payment shall be irrevocable and shall apply to any
          benefits that become payable to the Participant and his or her spouse under this
          Plan. Notwithstanding anything to the contrary, if a Participant makes this
          election during the 2006 calendar year, the election shall not apply to any
          benefit payments the Participant would otherwise have received during the 2006
          calendar year and those payments shall be made at the time(s) they would
          otherwise have been paid during 2006. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>5</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If the Participant&#146;s Payment Date occurs before his or her 65th birthday,
               the present value of the Participant&#146;s Supplemental Pension under the Plan
               (including any benefits payable to the spouse or other Beneficiary) shall be
               paid to him or her in five (5) equal annual installments that are the Actuarial
               Equivalent of the Participant&#146;s Supplemental Pension under this Plan
               (including any benefits payable to the spouse or other Beneficiary), which
               installments shall be payable on the Participant&#146;s Payment Date and the
               succeeding four anniversaries of the Participant&#146;s Payment Date, with those
               installment payments being calculated taking into account interest from the
               Benefit Commencement Date to the date of the last installment payment at the
               rate of four and one-half percent (4.5%). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If the Participant&#146;s Payment Date occurs on or after the Participant&#146;s
               65th birthday, the present value of the Participant&#146;s Supplemental Pension
               under the Plan (including any benefits payable to the spouse or other
               Beneficiary) shall be paid to him or her in a lump sum payment that is the
               Actuarial Equivalent of the Participant&#146;s Supplemental Pension under this
               Plan (including any benefits payable to the spouse or other Beneficiary). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In the event a Participant validly elects the accelerated method of payment
               under this Section 5(d) and dies before his or her Separation from Service, the
               Participant&#146;s spouse, if any, shall receive the Actuarial Equivalent
               present value of the Supplemental Spouse&#146;s Death Benefit under Section
               6(b), payable in five (5) annual installment payments, if the Participant died
               before reaching age 65, or in a lump sum payment, if the Participant died on or
               after his or her 65th birthday, with the payment(s) beginning or to be made on
               the first day of the third full calendar month following the Participant&#146;s
               date of death. If the Participant dies before his or her Separation from Service
               and has no surviving spouse, then no benefit shall be payable to anyone under
               this Plan with respect to the Participant. If the Participant dies after his or
               her Separation from Service but before receiving the lump sum payment or all of
               the 5-year installment payments as elected under this Section 5(d), then that
               lump sum payment or the remaining installment payments shall be paid to the
               Participant&#146;s Beneficiary at the time those payments would have been paid
               to the Participant. The Participant&#146;s spouse who is entitled to receive the
               payment(s) under this Section 5(d)(3) shall be the person, if any, of the
               opposite sex to whom the participant is legally married at the
               Participant&#146;s death. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 6</I>&#150; <I>Death
Benefits</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Except as provided in Section 5(d)(3), if a Participant dies on or after the
          Participant&#146;s Benefit Commencement Date, the only death benefit payable to
          his or her Beneficiary from this Plan shall be the death benefit, if any,
          payable to the Beneficiary under Section 5(a), commencing on the date one month
          after the date of the last monthly payment paid to the Participant before his or
          her death or, in the case of a Participant whose Benefit Commencement Date
          occurred before February 9, 2006, the survivor annuity or other death benefit
          payable to the Beneficiary under Section 5(a) under the payment form used for
          the Participant&#146;s Supplemental Pension. No death benefit shall be payable
          to the Participant&#146;s </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>6</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Beneficiary under this Section 6(a) if the Participant
          elected the 5-year installments or lump sum accelerated method of payment under
          Section 5(d). If a Participant&#146;s Beneficiary predeceases the Participant,
          the death benefit provided under this Section 6(a) shall be paid to the
          contingent Beneficiary designated by the Participant, or if none is designated,
          to the Participant&#146;s estate. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If a Participant dies before the Participant&#146;s Benefit Commencement Date,
          the only death benefit that shall be provided from this Plan is the Supplemental
          Spouse&#146;s Death Benefit. Except as provided in Section 5(d), the
          Supplemental Spouse&#146;s Death Benefit shall be paid to the Participant&#146;s
          surviving spouse as a monthly single life annuity for the Spouse&#146;s life
          with monthly benefits commencing on the first day of the third full calendar
          month following the date of the Participant&#146;s death. The amount of the
          Supplemental Spouse&#146;s Death Benefit shall be determined in the same manner
          as the spouse&#146;s death benefit under the related Defined Benefit Plan is
          determined, except on the basis of the Participant&#146;s Supplemental Pension
          under this Plan, rather than the Participant&#146;s Accrued Pension under the
          Defined Benefit Plan. The Participant&#146;s spouse who is entitled to receive
          the payment(s) under this Section 6(b) shall be the person, if any, of the
          opposite sex to whom the participant is legally married at the
          Participant&#146;s death. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 7</I> &#150; <I>Beneficiary Designation</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>A Participant may designate a
Beneficiary and contingent Beneficiary to receive the death benefit provided under Section
6(a). A Participant&#146;s Beneficiary designation must be in writing, on a form signed by
the Participant and acceptable to the Pension Committee, and shall be effective upon
receipt by the Pension Committee before the Participant&#146;s death. A Participant may
change his or her Beneficiary designation at any time and the last designation received by
the Pension Committee shall control. If the Participant fails to validly designate a
Beneficiary under this Plan or if his designated Beneficiary fails to survive him or her,
any death benefit provided under Section 6(a) shall be paid to the contingent Beneficiary
designated by the Participant, or if none is designated, to the Participant&#146;s estate. </FONT></P>



<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 8</I> &#150; <I>Tax
Withholdings</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall have the right to deduct from each payment to be made hereunder any
withholding or other taxes required by law. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 9</I>&#150; <I>Payments
in the Event of Incapacity</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event that the Pension Committee shall find that the Participant or other person
entitled to a benefit is unable to care for his or her affairs because of illness or
accident or is a minor or has died, the Company may pay any benefit payment due him or her
to his or her spouse, a child, a parent or other blood relative, or to a person with whom
he or she resides, unless claim shall have been made thereof or by a duly appointed legal
representative, and any such payment so made shall be a complete discharge of the
liabilities of the Company therefor. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>7</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 10</I> &#150; <I>Forfeitures</I> </B></FONT></P>



<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Anything
to the contrary notwithstanding, all of the rights and benefits under this Plan of a
Participant, his or her surviving spouse and his or her Beneficiary, shall be forfeited
under the following circumstances: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          if the Participant&#146;s employment with the Black &amp; Decker Companies is
          terminated by reason of his or her commission of any criminal act; or </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          if, without the prior written consent of the applicable Black &amp; Decker
          Company, the Participant enters into competition with any of the Black &amp;
          Decker Companies or discloses or uses confidential information of any of the
          Black &amp; Decker Companies, whether before or after his or her retirement or
          other termination of employment with the Black &amp; Decker Companies. If a
          Participant receives payment of his or her benefits under this Plan in a lump
          sum or installments and at any time after his or her Benefit Commencement Date,
          without the Company&#146;s written consent, enters into competition with any of
          the Black &amp; Decker Companies or discloses or uses confidential information,
          the Participant shall forfeit his or her right to those installment payments or
          that lump sum payment and shall immediately repay to the Company the full amount
          of that lump sum payment or the installment payments that he or she received. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the purposes of this Plan, a Participant shall be deemed to have entered into competition
with one of the Black &amp; Decker Companies if he or she directly or indirectly (whether
as a consultant, agent, officer, director, stockholder, employee, owner, operator, sole
proprietor, partner, joint venturer or otherwise) participates in or is connected with the
ownership, operation, management or control of any business enterprise which is in
competition, whether direct or indirect, with any of the types of businesses conducted by
any of the Black &amp; Decker Companies for which the Participant rendered any services
within the preceding 36 months and within any of the same territories as such Black &amp;
Decker Companies conduct that type of business, as determined by the Pension Committee in
its sole and absolute discretion; provided, however, that the Participant&#146;s ownership
of five percent (5%) or less of the stock of a publicly-held company shall not be
prohibited hereby. For the purposes of this Plan, the term. &#147;confidential
information&#148; means any information which any of the Black &amp; Decker Companies
considers secret or confidential, including but not limited to information about the
business, customers, employees, or marketing of the Black &amp; Decker Companies, or
technical data, drawings or other know-how, as determined by the Pension Committee in its
sole and absolute discretion; provided, however, that the disclosure or use by the
Participant of secret or confidential information shall not be prohibited hereby once such
secret or confidential information comes into the public domain through no action of the
Participant. If any restriction imposed by this Section is more restrictive than permitted
by law, the scope of the restriction is to be limited to the extent permitted by law, but
is not to be deemed unenforceable or void. </FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 11</I> &#150; <I>Company&#146;s Obligations Unfunded and Unsecured</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise required by applicable law, the Company&#146;s obligations under this Plan
are not required to be funded or secured in any manner; no assets need be placed in trust or </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>8</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
in escrow or otherwise physically or legally segregated for the benefit of any
Participant; and the eventual payment of the benefits described in this Plan to a
Participant or the Participant&#146;s spouse or Beneficiary is not required to be secured
to the Participant or them by the issuance of any negotiable instrument or other evidence
of the Company&#146;s indebtedness. Neither a Participant nor the Participant&#146;s
spouse or Beneficiary is entitled to any property interest, legal or equitable, in any
specific asset of the Company, and, to the extent that any person acquires any right to
receive payments under the provisions of this Plan, that right is intended to be no
greater than or to have any preference or priority over, the rights of any other unsecured
general creditor of the Company. However, the Company reserves the right, in its sole
discretion, to accumulate assets to offset its eventual liabilities under this Plan and
physically or legally to segregate assets for the benefit of any Participant or
Participant&#146;s spouse or Beneficiary (whether by escrow, by trust, by the purchase of
an annuity contract or by any other method of funding selected by the Company) without
liability for any adverse tax consequences resulting to that Participant or that
Participant&#146;s spouse or Beneficiary from the Company&#146;s action. Any such
segregation of assets may be made with respect to the Company&#146;s obligations under
this Plan for benefits attributable to an individual Participant, a selected group of
Participants or all Participants, as the Company may determine from time to time, in its
absolute discretion. Benefits under this Plan shall be payable by the Company from the
Company&#146;s general assets and no other company shall have any responsibility or
liability under this Plan. The Company&#146;s liabilities under this Plan shall, however,
be discharged to the extent of any payment received by the Participant (or the
Participant&#146;s surviving spouse or Beneficiary) from any other company made for that
purpose and on the Company&#146;s behalf or for its benefit. </FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 12</I>&#150; <I>Alienation or Encumbrance</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
payments, benefits or rights under this Plan shall be subject in any manner to
anticipation, sale, transfer, assignment, mortgage, pledge, encumbrance, charge or
alienation by a Participant, the Participant&#146;s spouse or Beneficiary or any other
person who could or might possibly receive benefit payments that were due to the
Participant or the Participant&#146;s spouse or Beneficiary, but were not paid. If the
Company determines that any person entitled to payments under this Plan has become
insolvent, bankrupt, or has attempted to anticipate, sell, transfer, assign, mortgage,
pledge, encumber, charge or otherwise in any manner alienate any amount payable to that
person under this Plan or that there is any danger of any levy, attachment, or other court
process or encumbrance on the part of any creditor of that person, against any benefit or
other amounts payable to that person, the Company may, in its sole discretion and to the
extent permitted by law, at any time, withhold any or all such payments or benefits and
apply the same for the benefit of that person, in such manner and in such proportion as
the Company may deem proper. </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 13</I>&#150; <I>Administration of Plan</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan shall be interpreted, administered, and operated by the Pension
          Committee, which shall have complete authority, in its sole and absolute
          discretion, to determine who is eligible for supplemental benefits hereunder, to
          interpret the Plan, to prescribe, amend and rescind rules and regulations
          relating to it, and to make all other determinations necessary or </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>9</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
advisable for
          the administration of this Plan. The Pension Committee&#146;s interpretations of
          the Plan and actions in respect of the Plan shall be binding and conclusive on
          all persons for all purposes. It is intended that this Plan comply with Code
          Section 409A and any regulations or guidance issued thereunder and shall be
          interpreted accordingly. Notwithstanding the amendment provisions of Section 17,
          the Plan may be amended by the Board of Directors of the Company at any time,
          retroactively, if found necessary, in the opinion of the Board of Directors, to
          conform the Plan to the provisions and requirements of Code Section 409A. No
          such amendment shall be considered prejudicial to any interest of a Participant
          or Beneficiary hereunder. Any provision of the Plan not in conformance with Code
          Section 409A shall be void as of January 1, 2005. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Neither the Pension Committee nor any person acting on its behalf shall be
          liable to any person for any action taken or omitted in connection with the
          interpretation and administration of the Plan unless attributable to gross
          negligence or willful misconduct. In addition to such other rights of
          indemnification as they may have as directors, officers or employees of the
          Company, each member of the Pension Committee shall be indemnified by the
          Company against the reasonable expenses, including attorneys&#146; fees,
          actually and necessarily incurred in connection with the defense of any action,
          suit or proceeding, or in connection with any appeal therein, to which he or she
          may be a party by reason of any action taken or omitted under or in connection
          with the Plan, and against all amounts paid in settlement thereof, provided such
          settlement is approved by independent legal counsel selected by the Company, or
          paid by him or her in satisfaction of a judgment in any such action, suit or
          proceeding, except in relation to matters as to which it shall be adjudged in
          such action, suit or proceeding that such member is liable for gross negligence
          or willful misconduct in his or her duties; provided that within 60 days after
          the institution of such action, suit or proceeding the member shall in writing
          offer the Company the opportunity, at its own expense, to handle and defend the
          same. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If a Participant is also a member of the Pension Committee, the Participant may
          not vote or act upon matters relating specifically to his or her participation
          in the Plan. </FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 14</I> &#150; <I>No
Guarantee of Employment</I> </B></FONT></P>



<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Plan shall not be construed as conferring any legal rights upon any Participant for
continuation of employment, nor shall it interfere with the rights of the Company to
discharge a Participant and to treat him or her without regard to the effect which such
treatment might have upon him or her under the Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 15</I>&#150; <I>Choice
of Law</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan,
and the respective rights and duties of the parties hereunder, shall in all respects be
governed by and construed in accordance with the laws of the State of Maryland, except to
the extent that those laws shall have been preempted by the laws of the United States. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>10</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>





<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 16</I> &#150; <I>Claims
Procedure</I> </B></FONT></P>





<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any claim
by a Participant, a Participant&#146;s spouse or Beneficiary that benefits under the Plan
have not been paid in accordance with the terms and conditions of the Plan shall be made
in writing and delivered to the Pension Committee at the Company&#146;s principal office
in the State of Maryland. The Pension Committee shall notify the claimant if any
additional information is needed to process the claim. All claims shall be approved or
denied by the Pension Committee within 90 days of receipt of the claim by the Pension
Committee. If the claim is denied, the Pension Committee shall furnish the claimant with a
written notice containing: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          an explanation of the reason for the denial, </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          a specific reference to the applicable provisions of the Plan, </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          a description of any additional material or information necessary for the
          claimant to pursue the claim, and </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          a statement of the claimant&#146;s right to bring a civil action under Section
          502(a) of ERISA. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within
90 days of receipt of the notice described above, the claimant shall, if he or she desires
further review, file a written request for reconsideration with the Pension Committee. A
request for reconsideration must include an explanation of the grounds for the request and
the facts supporting the claim. So long as the claimant&#146;s request for review is
pending, including such 90-day period, the claimant or his or her duly authorized
representative may review pertinent documents and may submit issues and comments in
writing to the Pension Committee. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
final and binding decision shall be made by the Pension Committee within 60 days of the
filing of the request for reconsideration; provided, however, that the Pension Committee,
in its discretion, may extend this period up to an additional 60 days. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
decision by the Pension Committee shall be conveyed to the claimant in writing and shall
include specific reasons for the decision, with specific references to the applicable
provisions of the Plan on which the decision is based and a statement of the
claimant&#146;s right to bring a civil action under Section 502(a) of ERISA. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>11</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 17</I> &#150; <I>Amendments and Termination</I> </B></FONT></P>




<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors of the Company reserves the right, in its sole and absolute discretion:
(a) to amend this Plan, in whole or in part, at any time and from time to time, and (b) to
terminate this Plan at any time; provided, however, that no such amendment or termination
shall have the effect of accelerating or permitting the acceleration of any payment under
this Plan, except to the extent that such acceleration would be permitted under Code
Section 409A, and, except as otherwise provided in Section 5(c), no such amendment or
termination shall reduce the Supplemental Pension or the Supplemental Spouse&#146;s Death
Benefit determined as of the date on which the amendment is adopted or this Plan is
terminated, as the case may be. </FONT></P>

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     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">WITNESS:<BR><BR><U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">BLACK &amp; DECKER (U.S.) INC.
<BR><BR>
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT></TD></TR>

<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD></TR>


<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR> </FONT></TD></TR>
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<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>12</FONT></P>
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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>11
<FILENAME>form10k12312005k.htm
<DESCRIPTION>EXHIBIT 10(O)(1)
<TEXT>


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<BR><BR><BR><BR><BR><BR><BR><BR>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (o)(1)<BR><BR><BR><BR><BR><BR><BR><BR></B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER <BR>SUPPLEMENTAL
RETIREMENT SAVINGS PLAN </FONT></P>

<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>January 1, 2005</FONT></P><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR>



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<DIV STYLE="page-break-after:always"></DIV>

<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER <BR>SUPPLEMENTAL
RETIREMENT SAVINGS PLAN </FONT></P>




<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A002></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>TABLE OF CONTENTS</U> </FONT></P>

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<A NAME=A003></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 1<BR> DEFINITIONS</FONT></P>




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     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">1.1  <BR>
1.2  <BR>
1.3  <BR>
1.4 <BR>
1.5  <BR>
1.6  <BR>
1.7  <BR>
1.8  <BR>
1.9  <BR>
1.10 <BR>
1.11 <BR>
1.12 <BR>
1.13 <BR>
1.14 <BR>
1.15 <BR>
1.16 <BR>
1.17 <BR>
1.18 <BR>
1.19 <BR>
1.20 <BR>
1.21 <BR>
1.22 <BR>
1.23 <BR>
1.24 <BR>
1.25 <BR>
1.26 <BR>
1.27
</FONT></TD>



     <TD WIDTH="10%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>



<TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ACCOUNT<BR>
BENEFICIARY<BR>
CHANGE IN CONTROL<BR>
CODE<BR>
COMMITTEE<BR>
COMPANY<BR>
COMPENSATION<BR>
COMPENSATION DEFERRAL ACCOUNT<BR>
COMPENSATION DEFERRALS<BR>
DESIGNATED BONUS PROGRAM<BR>
DESIGNATION DATE<BR>
EFFECTIVE DATE<BR>
ELIGIBLE EMPLOYEE<BR>
EMPLOYER<BR>
EMPLOYER CONTRIBUTION CREDIT ACCOUNT<BR>
EMPLOYER CONTRIBUTION CREDITS<BR>
ENTRY DATE<BR>
ERISA<BR>
EXCHANGE ACT<BR>
PARTICIPANT<BR>
PARTICIPANT ENROLLMENT AND ELECTION FORM<BR>
PLAN<BR>
PLAN MANAGER<BR>
PLAN YEAR<BR>
PRIOR PLAN<BR>
SAVINGS PLAN<BR>
VALUATION DATE
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">1<BR>
1<BR>
1<BR>
3<BR>
3<BR>
3<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
4<BR>
5<BR>
5<BR>
5<BR>
5<BR>
5<BR>
5<BR>
5<BR>
5<BR>
5
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 2<BR> ELIGIBILITY AND PARTICIPATION</FONT></P>



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     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">2.1<BR>
2.2<BR>
2.3
</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">REQUIREMENTS<BR>
RE-EMPLOYMENT<BR>
CHANGE OF EMPLOYMENT CATEGORY
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">5<BR>
6<BR>
6
</FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>i</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 3<BR> CONTRIBUTIONS AND CREDITS</FONT></P>



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     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">3.1<BR>
3.2<BR>
3.3
</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">EMPLOYER CONTRIBUTIONS CREDITS<BR>
PARTICIPANT COMPENSATION DEFERRALS<BR>
DEFERRALS UNDER OTHER PLANS OR ARRANGEMENTS
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">6<BR>
7<BR>
8
</FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 4<BR> ALLOCATION OF FUNDS</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">4.1<BR>
4.2<BR>
4.3<BR>
4.4<BR>
4.5<BR>
4.6<BR>
4.7<BR>

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ALLOCATION OF EARNINGS OR LOSSES ON ACCOUNTS<BR>
ACCOUNTING FOR DISTRIBUTIONS<BR>
SEPARATE ACCOUNTS<BR>
INTERIM VALUATIONS<BR>
DEEMED INVESTMENT DIRECTIONS OF PARTICIPANTS<BR>
EXPENSES<BR>
INSURANCE
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">8<BR>
9<BR>
9<BR>
9<BR>
9<BR>
10<BR>
10
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 5<BR> ENTITLEMENT TO BENEFITS</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">5.1<BR>
5.2<BR>
5.3

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">PAYMENT DATES<BR>
VESTING<BR>
TREATMENT OF FORFEITURES
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">10<BR>
11<BR>
11
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 6<BR> DISTRIBUTION OF BENEFITS</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">6.1<BR>
6.2<BR>
6.3<BR>
6.4

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">AMOUNT<BR>
METHOD OF PAYMENT<BR>
DEATH BENEFITS<BR>
CHANGE IN CONTROL OF THE COMPANY
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">12<BR>
12<BR>
12<BR>
13
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 7<BR> BENEFICIARIES; PARTICIPANT DATA</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">7.1<BR>
7.2

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">DESIGNATION OF BENEFICIARIES<BR>
INFORMATION TO BE FURNISHED BY PARTICIPANTS AND <BR>BENEFICIARIES; INABILITY TO LOCATE PARTICIPANTS OR <BR>BENEFICIARIES
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">13<BR><BR><BR>
13
</FONT></TD></TR>
</TABLE>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>ii</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 8<BR> ADMINISTRATION</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">8.1<BR>
8.2<BR>
8.3<BR>
8.4

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ADMINISTRATIVE AUTHORITY<BR>
UNIFORMITY OF DISCRETIONARY ACTS<BR>
LITIGATION<BR>
CLAIMS PROCEDURE
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">14<BR>
15<BR>
15<BR>
15
</FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 9<BR> AMENDMENT</FONT></P>



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     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">9.1<BR>
9.2

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">RIGHT TO AMEND<BR>
AMENDMENTS TO ENSURE PROPER CHARACTERIZATION OF PLAN
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">16<BR>
16
</FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 10<BR> TERMINATION</FONT></P>



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     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">10.1<BR>
10.2<BR>
10.3<BR>
10.4<BR>
10.5

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">TERMINATION OR SUSPENSION OF PLAN<BR>
AUTOMATIC TERMINATION OF PLAN<BR>
SUSPENSION OF DEFERRALS<BR>
ALLOCATION AND DISTRIBUTION<BR>
SUCCESSOR TO EMPLOYER
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">16<BR>
17<BR>
17<BR>
17<BR>
17
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 11<BR>THE TRUST</FONT></P>



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<TR VALIGN="BOTTOM">
     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">11.1<BR>

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ESTABLISHMENT OF TRUST
</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">17
</FONT></TD></TR>
</TABLE>




<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE 12<BR> MISCELLANEOUS</FONT></P>



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     <TH ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">12.1<BR>
12.2<BR>
12.3

</FONT></TD>
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">LIMITATIONS ON LIABILITY OF EMPLOYERS<BR>
CONSTRUCTION<BR>
SPENDTHRIFT PROVISION</FONT></TD>
     <TD WIDTH="15%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">18<BR>
18<BR>
19
</FONT></TD></TR>
</TABLE>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>iii</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER <BR>SUPPLEMENTAL
RETIREMENT SAVINGS PLAN </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A005></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>RECITALS</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Supplemental Retirement Savings Plan (the &#147;Plan&#148;) is adopted
by The Black &amp; Decker Corporation (the &#147;Company&#148;) for certain executive
employees. The purpose of the Plan is to offer those employees an opportunity to elect to
defer the receipt of compensation in order to provide deferred compensation benefits
taxable pursuant to Section 451 of the Internal Revenue Code of 1986, as amended (the
&#147;Code&#148;). The Plan is intended to be a &#147;top-hat&#148; plan (i.e., an
unfunded deferred compensation plan maintained for a select group of management or
highly-compensated employees) under Sections 201(2), 301(a)(3) and 401(a)(1) of the
Employee Retirement Income Security act of 1974, as amended (&#147;ERISA&#148;). This Plan
shall apply to all amounts earned and/or vested on or after January 1, 2005. Amounts
earned and vested on or before December 31, 2004, shall be subject to the terms of the
applicable Prior Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company recognizes the transfer
of the associated assets and liabilities of the Pentair, Inc. Non-Qualified Deferred
Compensation Plan, as amended and restated effective as of January 1, 2002, (Pentair, Inc.
NQDCP) from the Pentair, Inc. NQDCP to the Company effective as of October 4, 2004, for
employees who became Black &amp; Decker employees as a result of the acquisition by the
Company of Pentair Inc.&#145;s Tools Group. Deferrals made under the Pentair, Inc. NQDCP
prior to January 1, 2005, will be administered in accordance with the Pentair, Inc. NQDCP
to the extent the deferrals are vested prior to January 1, 2005. All deferrals earned or
vested after January 1, 2005 for such employees, will be administered in accordance with
this Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A006></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 1</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A007></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>DEFINITIONS</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>ACCOUNT</U> means the balance credited to a Participant&#146;s or Beneficiary&#146;s
Plan account, including contribution credits and income, gains and losses (as determined
by the Committee, in its discretion) credited thereto. A Participant&#146;s or
Beneficiary&#146;s Account shall be determined as of the date of reference. </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>BENEFICIARY</U> means any person or persons so designated in accordance with the provisions of Article 7.</FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>CHANGE IN CONTROL</U> means with respect to the Black &amp;  Decker Corporation or its subsidiaries or affiliates:</FONT></P>



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               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The acquisition by any one person or more than one person acting as a group of
                    any of the Corporation&#146;s stock, if the sum of the stock so acquired plus
                    the stock held by that person or group before the acquisition constitutes more
                    than fifty percent (50%) of the total fair market value or </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>1</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
total voting power of
                    the stock of the Corporation and the stock held by that person or group
                    immediately before that acquisition constituted fifty percent (50%) or less of
                    the then total fair market value or total voting power of the stock of the
                    Corporation. An increase in the percentage of the Corporation&#146;s stock owned
                    by any one person or persons acting as a group as a result of a transaction in
                    which the Corporation acquires its stock in exchange for property will be
                    treated as an acquisition of stock for this purpose. This paragraph (a) only
                    applies when there is a transfer of stock of the Corporation (or issuance of
                    stock of the Corporation) and stock in the Corporation remains outstanding after
                    the transaction. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The acquisition by any one person or more than one person acting as a group
                    during the 12-month period ending on the most recent such acquisition by that
                    person or group of ownership of stock of the Corporation possessing thirty-five
                    percent (35%) or more of the total voting power of the stock of the Corporation
                    and the stock held by that person or group immediately before that acquisition
                    constituted less than thirty-five percent (35%) of the then total voting power
                    of the stock of the Corporation. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    A majority of the members of the Board is replaced during any 12-month period by
                    directors whose appointment or election is not endorsed by a majority of the
                    members of the Board prior to the date of the appointment or election, provided
                    that no other corporation is the majority stockholder of the stock of the
                    Corporation. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The acquisition by any one person or more than one person acting as a group
                    during the 12-month period ending on the most recent such acquisition by that
                    person or group of assets of the Corporation that have a total gross fair market
                    value equal to or more than forty percent (40%) of the total gross fair market
                    value of all of the Corporation&#146;s assets immediately prior to such
                    acquisition or acquisitions. For this purpose, gross fair market value means the
                    value of the Corporation&#146;s assets, or the value of the assets being
                    disposed of, determined without regard to any liabilities associated with those
                    assets. There is no Change in Control of the Corporation under this Paragraph
                    (d) when there is a transfer to an entity that is controlled by the shareholders
                    of the Corporation immediately after the transfer. A transfer of assets will not
                    qualify as a Change in Control of the Corporation under this Paragraph (d) if
                    the assets are transferred to: (i) a shareholder of the Corporation immediately
                    before the transfer in exchange for or with respect to the Corporation&#146;s
                    stock; (ii) an entity, fifty percent (50%) or more of the total value or voting
                    power of which is owned, directly or indirectly, by the Corporation; (iii) a
                    person, or more than one person acting as a group, that owns, directly or
                    indirectly, fifty percent (50%) or more of the total value or voting power of
                    all of the outstanding stock of the Corporation; or (iv) an entity, at least
                    </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
fifty percent (50%) of the total value or voting power of which is owned,
                    directly or indirectly, by a person, or more than one person acting as a group,
                    that owns, directly or indirectly, fifty percent (50%) or more of the total
                    value or voting power of all of the outstanding stock of the Corporation. </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the purpose of interpreting this definition of &#147;Change in Control of the
Corporation,&#148; the following rules apply: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Persons will be considered as acting as a group only if they are owners of a
               corporation that enters into a merger, consolidation, purchase or acquisition of
               assets, or similar business transaction with the Corporation. If a person,
               including an entity shareholder, owns stock in the Corporation and the other
               corporation that enters into a merger, consolidation, purchase or acquisition of
               stock, or similar transaction with respect to the Corporation, that shareholder
               is considered to be acting as a group with other shareholders in a corporation
               only to the extent of the ownership in that corporation prior to the transaction
               giving rise to the Change in Control event and not with respect to the ownership
               interest in the other corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Ownership shall be determined taking into account the attribution rules set
               forth in Section 318(a) of the Code. Stock underlying a vested option is
               considered owned by the option holder and non-vested stock is not considered
               owned by the option holder. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If any one person, or more than one person acting as a group, is considered to
               effectively control the Corporation as described in Paragraphs (b) &amp; (c)
               above, the acquisition of additional control of the Corporation by the same
               person or persons is not considered to cause a change in the effective control
               of the Corporation or to cause a change in the ownership of the Corporation for
               the purposes of this definition. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Each Change in Control event described in this definition is intended to
               constitute a change in ownership or effective control of the Corporation or in
               the ownership of a substantial portion of the Corporation&#146;s assets within
               the meaning of Section 409A(a)(2)(A)(v) of the Code. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4&nbsp;&nbsp;&nbsp;&nbsp;
<U>CODE</U> means the Internal Revenue Code of 1986 and the regulations thereunder, as
amended from time to time. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMMITTEE</U> means the Pension Management Committee of the Company. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMPANY</U> means The Black &amp;  Decker Corporation and its successors and assigns. </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>3</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMPENSATION </U>means the base salary of an employee of an Employer and any bonus
payment payable to an employee of an Employer under a Designated Bonus Program. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMPENSATION DEFERRAL ACCOUNT </U>is defined in Section 3.2. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMPENSATION DEFERRALS </U>is defined in Section 3.2. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10&nbsp;&nbsp;&nbsp;&nbsp;
<U>DESIGNATED BONUS PROGRAM</U> means The Black &amp; Decker Annual Incentive Plan, and
any other cash-based incentive plan designated by the Committee from time to time. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11&nbsp;&nbsp;&nbsp;&nbsp;
<U>DESIGNATION DATE</U> means the date or dates on which a designation of deemed
investment directions by an individual pursuant to Section 4.5, or any change in a prior
designation of deemed investment directions by an individual pursuant to Section 4.5,
shall become effective. The Designation Dates in any Plan Year shall be specified by the
Committee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12&nbsp;&nbsp;&nbsp;&nbsp;
<U>EFFECTIVE DATE</U> means the effective date of the Plan, which, notwithstanding the
date of execution hereof, shall be January 1, 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13&nbsp;&nbsp;&nbsp;&nbsp;
<U>ELIGIBLE EMPLOYEE</U> means, for any Plan Year (or applicable portion thereof), a
person employed by an Employer, who is paid through a U.S. payroll system, is a
&#147;highly compensated employee&#148; as defined at Code Section 414(q), and who is
determined by the Committee to be a member of a select group of management or highly
compensated employees. The term Eligible Employee shall not include a non-U.S. citizen who
is ineligible for the Savings Plan. By each November 1 (or on or before the Effective Date
for the Plan&#146;s first Plan Year), the Plan Manager shall notify those individuals, if
any, who will be Eligible Employees for the next Plan Year. If the Committee determines
that an individual first becomes an Eligible Employee during a Plan Year, the Plan Manager
shall notify such individual of the Committee&#146;s determination and of the date during
the Plan Year on which the individual shall first become an Eligible Employee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14&nbsp;&nbsp;&nbsp;&nbsp;
<U>EMPLOYER</U> means the Company unless otherwise herein provided, or any subsidiary or
affiliate of the Company that agrees, with the consent of the Company, to become a party
to the Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15&nbsp;&nbsp;&nbsp;&nbsp;
<U>EMPLOYER CONTRIBUTION CREDIT ACCOUNT</U> is defined in Section 3.1. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16&nbsp;&nbsp;&nbsp;&nbsp;
<U>EMPLOYER CONTRIBUTION CREDITS</U> is defined in Section 3.1. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17&nbsp;&nbsp;&nbsp;&nbsp;
<U>ENTRY DATE</U> with respect to an individual means the first day of the pay period
following the date on which the individual first becomes an Eligible Employee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18&nbsp;&nbsp;&nbsp;&nbsp;
<U>ERISA</U> means the Employee Retirement Income Security Act of 1974, as amended from
time to time. </FONT></P>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19&nbsp;&nbsp;&nbsp;&nbsp;
<U>EXCHANGE ACT</U> means the Securities Exchange Act of 1934, as amended from time to time. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20&nbsp;&nbsp;&nbsp;&nbsp;
<U>PARTICIPANT</U> means any person so designated in accordance with the provisions of
Article 2, including, where appropriate according to the context of the Plan, any former
employee who is or may become (or whose Beneficiaries may become) eligible to receive a
benefit under the Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.21&nbsp;&nbsp;&nbsp;&nbsp;
<U>PARTICIPANT ENROLLMENT AND ELECTION FORM</U> means the form or forms on which a
Participant elects to defer Compensation hereunder and on which the Participant makes
certain other designations as required thereon. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.22&nbsp;&nbsp;&nbsp;&nbsp;
<U>PLAN</U> means The Black &amp; Decker Supplemental Retirement Savings Plan, as amended
from time to time. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.23&nbsp;&nbsp;&nbsp;&nbsp;
<U>PLAN MANAGER</U> means the Vice President of Benefits for the Company, or such other
person as may be designated by the Committee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.24&nbsp;&nbsp;&nbsp;&nbsp;
<U>PLAN YEAR</U> means each accounting period commencing on the Effective Date and ending
on the December 31 of each year in which the Plan is in effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.25&nbsp;&nbsp;&nbsp;&nbsp;
<U>PRIOR PLAN</U> means the Company&#146;s Supplemental Retirement Savings Plan, effective
February 1, 1996. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.26&nbsp;&nbsp;&nbsp;&nbsp;
<U>SAVINGS PLAN</U> means The Black &amp;  Decker Retirement Savings Plan or a successor plan. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.27&nbsp;&nbsp;&nbsp;&nbsp;
<U>VALUATION DATE</U> means the last day of each Plan Year and any other date that the
Committee, in its sole discretion, designates as a Valuation Date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A008></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 2</U> </FONT></P>

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<A NAME=A009></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ELIGIBILITY AND
PARTICIPATION</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>REQUIREMENTS</U>. Every Eligible Employee on the Effective Date shall be eligible to
become a Participant on the Effective Date. Every other Eligible Employee shall be
eligible to become a Participant on the first Entry Date occurring on or after the date on
which he or she becomes an Eligible Employee. No individual shall become a Participant,
however, if he or she is not an Eligible Employee on the date his or her participation is
to begin. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Participation
in the Participant Compensation Deferral feature of the Plan is voluntary. In order to
participate in the Participant Compensation Deferral feature of the Plan, an otherwise
Eligible Employee must make written application in such manner as may be required by
Section 3.2 and by the Committee and must agree to make Compensation Deferrals as provided
in Article 3. </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>5</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>RE-EMPLOYMENT</U>. If an Eligible Employee whose employment with all Employers is
terminated is subsequently re-employed by an Employer, he or she shall become an Eligible
Employee in accordance with the provisions of Section 2.1. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>CHANGE OF EMPLOYMENT CATEGORY</U>. During any period in which a Participant remains in
the employ of an Employer, but ceases to be an Eligible Employee, he or she shall not be
eligible to make Compensation Deferrals hereunder. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A010></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 3</U> </FONT></P>

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<A NAME=A011></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>CONTRIBUTIONS AND
CREDITS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>EMPLOYER CONTRIBUTION CREDITS</U>. There shall be established and maintained a separate
Employer Contribution Credit Account in the name of each Participant. There shall be
established the following two sub-accounts under a Participant&#146;s Employer
Contribution Credit Account: (a) Matching Contribution Sub-Account; and (b) Discretionary
Contribution Sub-Account. Each such Sub-Account shall be credited or debited, as
applicable, with (a) amounts equal to the Employer&#146;s Contribution Credits credited to
that Sub-Account; (b) any deemed earnings and losses (to the extent realized, based upon
the deemed fair market value of the Sub-Account&#146;s deemed assets as determined by the
Committee, in its sole and absolute discretion) allocated to that Sub-Account; and (c)
expenses charged to that Sub-Account. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of this Section, the Employer&#146;s Contribution Credits credited to a
Participant&#146;s Matching Contribution Sub-Account for a particular Plan Year shall be
an amount equal to the amount of the matching contributions that would be made to the
Participant&#146;s account under the Savings Plan for the Plan Year if the
Participant&#146;s Compensation Deferrals hereunder for the Plan Year had been made to the
Savings Plan (disregarding for purposes of this assumption the Code &sect; 402(g) limit)
instead of under this Plan (and assuming that no non-discrimination or annual addition
test limits on matching contributions and no limits on recognizable compensation applied
to the Savings Plan). The Company reserves the right, subject to any restrictions imposed
by applicable law, to credit Participant Matching Contribution Sub-Accounts with common
stock of the Company, which shall be credited at its fair market value at the time of
contribution. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of this Section, the Employer&#146;s Contribution Credits credited to a
Participant&#146;s Discretionary Contribution Sub-Account for a particular Plan Year shall
be an amount (if any) determined by the Committee, in its sole and absolute discretion. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Participant&#146;s Employer Contribution Credit Account shall be credited or debited, as
applicable, as of each Valuation Date, with deemed earnings or losses, as applicable, and
expenses. The amount of deemed earnings or losses and expenses shall be as determined by
the Committee hereunder, in its sole and absolute discretion. The Committee shall have the
sole and absolute discretion to allocate such deemed earnings or losses and expenses among
Participants&#146; Employer Contribution Credit Accounts and among a Participant&#146;s
Sub-Accounts </FONT></P>

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<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
pursuant to such allocation rules as the Committee deems to be reasonable and
administratively practicable. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
Participant shall at all times be 100% vested in amounts credited to his or her Employer
Contribution Account. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>PARTICIPANT COMPENSATION DEFERRALS</U>. In accordance with rules established by the
Committee, a Participant may elect to defer Compensation which is due to be earned and
which would otherwise be paid to the Participant. A Participant may elect to defer up to
25% of his base salary earned prior to January 1, 2006 and 50% of his base salary earned
after January 1, 2006 with no reduction of such maximum percentage for the percentage of
base salary the Participant has directed to be contributed to the Savings Plan. A
Participant may elect to defer up to 100% of a bonus payment not yet payable to him or her
at the time of the election under a Designated Bonus Program reduced by the percentage of
the bonus that the Participant has directed to be contributed to the Savings Plan as
Before-Tax and/or After-Tax contributions pursuant to the Participant&#146;s Savings Plan
election in effect at the time the Participant makes a bonus deferral election under this
Plan after taking into account the limit on compensation imposed by Code &sect;
401(a)(17). Amounts so deferred will be considered a Participant&#146;s &#147;Compensation
Deferrals.&#148; Ordinarily, a Participant shall make a Compensation Deferral election
with respect to a coming Plan Year during the period beginning on the November 1 and
ending on the November 30 of the prior Plan Year, or during such other period prior to the
beginning of the coming Plan Year established by the Committee. In the first year in which
an individual becomes an Eligible Employee, any newly Eligible Employee may make a
Compensation Deferral election with respect to services to be performed subsequent to the
election within thirty (30) days after the date the individual becomes eligible. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
accordance with rules and subject to limitations established by the Committee, an election
to defer the receipt of all or any portion of performance compensation (as defined in Code
Section 409A and the regulations and guidance thereunder) under a Designated Bonus Program
that is payable to the Eligible Employee by an Employer shall be made on such form or
forms as determined by the Plan Manager and shall be made at least six (6) months prior to
end of the service period over which such incentive compensation is earned by the Eligible
Employee and the Eligible Employee shall become a Participant upon making such election.
Incentive compensation deferrals shall be deductible from the incentive compensation
otherwise payable to the deferring Participant, and shall be credited to the Account of
the deferring Participant. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation
Deferrals shall be made through regular payroll deductions or through an election by the
Participant to defer the payment of a bonus payment not yet payable to him or her at the
time of the election under a Designated Bonus Program. The Participant may terminate his
or her regular payroll deduction Compensation Deferral amount as of, and by written notice
delivered to the Committee, prior to the last date a deferral election could be made.
Notwithstanding anything to the contrary, for the 2005 Plan Year, a Participant can revoke
his or her deferral election with respect to base salary and/or a bonus payment, provided
that he or she do so prior to December 31, 2005 and the amount subject to the revocation
is includible in the Participant&#146;s income in the 2005 calendar year, or, if later,
the taxable year in which the amounts are earned and vested. A Participant&#146;s deferral
election will be automatically revoked if the </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>7</FONT></P>
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<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Participant obtains a hardship distribution
under the Company&#146;s Retirement Savings Plan. Once terminated, a regular payroll
deduction Compensation Deferral amount may not be subsequently reinstated earlier than the
first day of the next Plan Year. A Compensation Deferral election shall continue in force
only for the Plan Year for which the election is first effective. An Eligible Employee
shall make a new Compensation Deferral election effective as of the first day of each Plan
Year in accordance with the procedures specified in this Section 3.2 for making
Compensation Deferral elections. All Compensation Deferral elections shall be made on a
subsequent Participant Enrollment and Election Form provided by the Committee.
Compensation Deferrals shall be deducted by the Employer from the Compensation of a
deferring Participant and shall be credited to the Account of the deferring Participant. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
shall be established and maintained by the Employer a separate Compensation Deferral
Account in the name of each Participant to which shall be credited or debited: (a) amounts
equal to the Participant&#146;s Compensation Deferrals and other incentive compensation
deferrals; (b) amounts equal to any deemed earnings or losses (to the extent realized,
based upon deemed fair market value of the Account&#146;s deemed assets, as determined by
the Committee, in its sole and absolute discretion) attributable or allocable thereto; and
(c) expenses charged to that Account. A Participant shall at all times be 100% vested in
amounts credited to his or her Participant Compensation Deferral Account. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3&nbsp;&nbsp;&nbsp;&nbsp;<U>DEFERRALS
UNDER OTHER PLANS OR ARRANGEMENTS</U>. <U>DEFERRALS UNDER OTHER PLANS OR ARRANGEMENTS</U>.
In accordance with rules and subject to limitations established by the Committee, amounts
credited for the benefit of an Eligible Employee under other deferred compensation plans
or arrangements of an Employer as designated by the Committee may be transferred to this
Plan. Prior to any such transfer, the Eligible Employee must complete such form or forms
as determined by the Plan Manager. Upon being transferred to this Plan, such amounts shall
be credited to the Account of such Eligible Employee as a Participant under this Plan, and
shall be administered in accordance with the provisions of this Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Notwithstanding the foregoing,
deferrals made under the Pentair, Inc. Non-Qualified Deferred Compensation Plan which have
been earned and vested prior to January 1, 2005 shall be administered in accordance with
the Pentair, Inc. Non-Qualified Deferred Compensation Plan and, with respect to deferrals
which have been earned and vested prior to January 1, 2005, elections made under the
Pentair, Inc. Non-Qualified Deferred Compensation Plan on the form of distribution and
deferral period shall be deemed to be the distribution form and date that would have
applied under the Pentair, Inc. Non-Qualified Deferred Compensation Plan. </FONT></P>

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<A NAME=A012></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 4</U> </FONT></P>

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<A NAME=A013></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ALLOCATION OF FUNDS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>ALLOCATION OF EARNINGS OR LOSSES ON ACCOUNTS</U>. Subject to such limitations as may
from time to time be required by law, imposed by the Committee or contained elsewhere in
the Plan, and subject to such operating rules and procedures as may be imposed </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>8</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
from time
to time by the Committee, prior to the date on which a direction will become effective,
the Participant shall have the right to direct the Committee how amounts in his or her
Account shall be deemed to be invested. The Participant&#146;s Plan Account will be
credited or debited with the increase or decrease in the realizable net asset value or
credited interest, as applicable, of the designated deemed investments, as follows: as of
each Valuation Date, an amount equal to the net increase or decrease in realizable net
asset value or credited interest, as applicable, of each deemed investment within the
Account since the preceding Valuation Date shall be allocated among all Participants&#146;
Accounts deemed to be invested in that investment in accordance with the ratio which the
portion of the Account of each Participant which is deemed to be invested within that
investment, determined as provided herein, bears to the aggregate of all amounts deemed to
be invested within that investment. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>ACCOUNTING FOR DISTRIBUTIONS</U>. As of the date of any distribution hereunder, the
distribution made hereunder to the Participant or his or her Beneficiary or Beneficiaries
shall be charged to such Participant&#146;s Account. Such amounts shall be charged on a
pro rata basis against the investments in which the Participant&#146;s Account is deemed
to be invested. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>SEPARATE ACCOUNTS</U>. A separate account under the Plan shall be established and
maintained to reflect the Account for each Participant with sub-accounts to show
separately the deemed earnings and losses credited or debited to such Account, and the
applicable deemed investments of the Account. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4&nbsp;&nbsp;&nbsp;&nbsp;
<U>INTERIM VALUATIONS</U>. If it is determined by the Committee that the value of the
Participant&#146;s account as of any date on which distributions are to be made differs
materially from the value of the Participant&#146;s Account on the prior Valuation Date
upon which the distribution is to be based, the Committee, in its sole and absolute
discretion, shall have the right to designate any date in the interim as a Valuation Date
for the purpose of revaluing the Participant&#146;s Account so that the Account will,
prior to the distribution, reflect its share of such material difference in value. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5&nbsp;&nbsp;&nbsp;&nbsp;
<U>DEEMED INVESTMENT DIRECTIONS OF PARTICIPANTS</U>. Subject to such limitations as may
from time to time be required by law, imposed by the Committee or contained elsewhere in
the Plan, and subject to such operating rules and procedures as may be established from
time to time by the Plan Manager, each Participant may communicate to the Plan Manager a
direction as to how his or her Plan Account should be deemed to be invested among such
categories of deemed investments as may be made available by the Committee hereunder. The
Plan Manager has discretion to develop rules and regulations to administer such investment
elections and transfers of investments, including establishing dollar or percentage
increments of the Plan Accounts for Participants to invest, and limits on the value of
Plan Accounts that Participants may invest in each deemed investment category or transfer
between each deemed investment category. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
amounts credited to the Participant&#146;s Account shall be deemed to be invested in
accordance with the then effective deemed investment direction; and as of the effective
date of any new deemed investment direction, all or a portion of the Participant&#146;s
Account at that date </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>9</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
shall be reallocated among the designated deemed investment
categories in the manner specified in the new deemed investment direction unless and until
a subsequent deemed investment direction shall be delivered and become effective. An
election concerning deemed investment choices shall continue indefinitely as provided in
the election form or other procedure specified by the Committee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the Plan Manager receives an initial or revised deemed investment direction which it deems
to be incomplete, unclear or improper, the Participant&#146;s investment direction then in
effect shall remain in effect (or, in the case of a deficiency in an initial deemed
investment direction, the Participant shall be deemed to have delivered no deemed
investment direction) until the next Designation Date, unless the Committee provides for,
and permits the application of, corrective action prior thereto. If the Plan Manager
possesses (or is deemed to possess as provided above) at any time directions as to the
deemed investment of less than all of a Participant&#146;s Account, the Participant shall
be deemed to have directed that the undesignated portion of the Account be deemed to be
invested in a money market, fixed income or similar fund made available under the Plan as
determined by the Committee in its sole and absolute discretion. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Participant hereunder, as a condition to his or her participation hereunder, agrees to
indemnify and hold harmless the Plan Manager, the Committee and their agents and
representatives from any losses or damages of any kind relating to the deemed investment
of the Participant&#146;s Account hereunder. Each reference in this Section to a
Participant shall be deemed to include, where applicable, a reference to a Beneficiary. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6&nbsp;&nbsp;&nbsp;&nbsp;
<U>EXPENSES</U>. Expenses attributable to the administration of the Plan, including
Trustee fees, shall be paid by the Company, but the Committee, in its sole and absolute
discretion, may elect to charge such expenses against the appropriate Participant&#146;s
Account or Participants&#146; Accounts. If an expense is charged against a
Participant&#146;s Account, in the sole and absolute discretion of the Committee, such
expense either (i) will reduce the Employer Contribution Credits under Section 3.1 next
due to be made by the Employer in respect of an Account maintained for the Participant or
(ii) will be charged against and shall reduce the Participant&#146;s Account hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7&nbsp;&nbsp;&nbsp;&nbsp;
<U>INSURANCE</U>. The Company may purchase life insurance policies on the lives of certain
Participants. If the Company elects to purchase a life insurance policy upon the life of a
Participant, than the Participant shall assist the Company by submitting to a physical
examination and supplying such additional information necessary to obtain the insurance
policy. The Company shall own the life insurance policies and the Participants shall have
no claim or interest in the policies. </FONT></P>

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<A NAME=A014></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 5</U> </FONT></P>

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<A NAME=A015></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ENTITLEMENT TO
BENEFITS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1&nbsp;&nbsp;&nbsp;&nbsp;<U>PAYMENT
DATES</U>. On his or her Participant Enrollment and Election Form, a Participant may
select an initial payment date for the payment or commencement of </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>10</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
payment of his or her
vested Account. For this purpose, the initial payment date may be (i) a specified date
that is no earlier than 12 months following the date of termination of the
Participant&#146;s employment with the Company and all of its subsidiaries and affiliates,
or (ii) a specified date that is no earlier than the first day of the second Plan Year
following the Plan Year to which the Compensation Deferral relates. The Participant&#146;s
vested Account will be valued and payable according to the provisions of Article 6. The
form of payment may be changed or an initial payment date may be extended to a later date
so long as the election to change the form of payment or to so extend the date is made by
the Participant 12 months prior to the initial payment date, may not take effect for at
least 12 months from the date of the election to extend and does not provide for a new
distribution date that is earlier than five years after the initial payment date. An
election change, whether to change the form of payment and/or extend initial payment
dates, may not be made more than once. An initial payment date may not be accelerated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
any provision of the Plan to the contrary, the Company may permit, in an equitable and
consistent manner for all Participants, the acceleration of a payment date solely under
the following circumstances as permitted under the Code: (a) to make a payment to an
individual other than the Participant as may be necessary to comply with a domestic
relations order (as defined in Code Section 414(p)(1)(B)); (b) to make a payment as may be
necessary to comply with a certificate of divestiture (as defined in Code Section
1043(b)(2)); or (c) to pay Federal Insurance Contributions Act (FICA) tax imposed under
Code Section 3101 and Section 3121(v)(2) on compensation deferred under the Plan and other
related employment taxes as permitted under Code Section 409A and regulations and guidance
thereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
a Participant does not select a payment date for any particular amounts hereunder, and the
Participant terminates employment with the Company and all of its subsidiaries and
affiliates for any reason, the Participant&#146;s Account at the date of such termination
shall be valued and payable 12 months following such termination according to the
provisions of Article 6. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;<U>VESTING</U>.
The Compensation  Deferral Account and Matching  Contribution  Sub-Account of each Participant shall be 100%
vested at all times.</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>TREATMENT OF FORFEITURES</U>. All forfeitures shall be applied to reduce the
corresponding Employer Contribution Credits for the Plan Year in which the forfeiture
occurred and thereupon shall be allocated as an Employer Contribution Credit in the manner
provided for the Employer Contribution Credits which the forfeitures replace. To the
extent such forfeitures exceed the amounts required or remaining to be credited as
Employer Contribution Credits under the Plan for any Plan Year, the excess shall be
applied to reduce Employer Contribution Credits for the following Plan Years until
exhausted. In the event the Plan is terminated, any forfeitures not yet applied to reduce
Employer Contribution Credits shall revert to the Company. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>11</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A016></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 6</U> </FONT></P>

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<A NAME=A017></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>DISTRIBUTION OF
BENEFITS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>DISTRIBUTION EVENTS AND AMOUNT</U>. A Participant (or his or her Beneficiary) shall
become entitled to receive a distribution in an aggregate amount equal to the
Participant&#146;s Account: (a) on or about the payment date or dates selected by the
Participant on his or her Participant Enrollment and Election Form as provided in Section
5.1 or, if none, on or about the date that is 12 months after the Participant&#146;s
termination of employment with the Company or any of its subsidiaries or affiliates, (b)
on the death of the Participant pursuant to Section 6.3; or (c) on a Change in Control
pursuant to Section 6.4 and Article 10. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>METHOD OF PAYMENT</U>.</FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;<U>Cash
Or In-Kind Payments</U>. Payments under the Plan shall generally be made in cash;
provided, however, that payment may be made in cash or in-kind, as permitted by the
Committee in its sole and absolute discretion and subject to any restrictions on transfer
as may be applicable legally and contractually. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;<U>Timing
and Manner of Payment</U>. In the case of distribution to a Participant or his or her
Beneficiary by virtue of an entitlement pursuant to Section 5.1, an aggregate amount equal
to the Participant&#146;s vested Account will be paid by the Company, as provided by
Section 6.1, in a lump sum or in substantially equal annual installments not to exceed 10
years (adjusted for gains and losses, and reduced by any required withholding or other
deductions from such payments), as selected by the Participant at the time the Participant
completes his or her Participant Enrollment and Election Form. If a Participant fails to
designate properly the manner of payment of the Participant&#146;s benefit under the Plan,
such payment will be in a lump sum on or about the fixed payment date or dates selected by
the Participant, or, if none, on or about the date of the Participant&#146;s termination
of employment with the Company and all of its subsidiaries and affiliates. Notwithstanding
the foregoing, amounts transferred to this Plan from The Pentair, Inc. Non-Qualified
Deferred Compensation Plan earned by and vested in the Participant before January 1, 2005
shall be paid by the Company in the payment form that would have been applicable pursuant
to section 7 of that plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the whole or any part of a payment hereunder is to be in installments, the total to be so
paid shall continue to be deemed to be invested pursuant to Article 4 under such
procedures as the Committee may establish, in which case any deemed income, gain, loss or
expense attributable thereto (as determined by the Committee in its sole and absolute
discretion) shall be reflected in the installment payments, in such equitable manner as
the Committee shall determine. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>DEATH BENEFITS</U>. If a Participant dies before the commencement of payments to the
Participant hereunder, the entire value of the Participant&#146;s Account shall be paid,
as provided in Section 6.2, to the person or persons designated in accordance with Section
7.1. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>12</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
the death of a Participant after payments hereunder have begun but before he or she has
received all payments to which he or she is entitled under the Plan, the remaining benefit
payments shall be paid to the person or persons designated in accordance with Section 7.1,
in a lump-sum. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the absence of a valid beneficiary designation, death benefits will be made to the
Participant&#146;s spouse, if alive; and if not, then to the Participant&#146;s estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4&nbsp;&nbsp;&nbsp;&nbsp;
<U>CHANGE IN CONTROL</U>. Notwithstanding any provision of the Plan to the contrary, on
the occurrence of a Change in Control, each Participant may be paid the entire value of
his or her account in one lump sum in accordance with Article 10. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A018></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 7</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A019></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>BENEFICIARIES;
PARTICIPANT DATA</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>DESIGNATION OF BENEFICIARIES</U>. Each Participant from time to time may designate any
person or persons (who may be named contingently or successively) to receive such benefits
as may be payable under the Plan upon or after the Participant&#146;s death, and such
designation may be changed from time to time by the Participant by filing a new
designation. Each designation will revoke all prior designations by the same Participant,
shall be in a form prescribed by the Committee, and will be effective only when filed in
writing with the Committee during the Participant&#146;s lifetime. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the absence of a valid Beneficiary designation, or if, at the time any benefit payment is
due to a Beneficiary, there is no living Beneficiary validly named by the Participant, the
Committee shall cause the payment of any such benefit payment to be made to the
Participant&#146;s spouse, if then living, but otherwise, to the Participant&#146;s
estate. In determining the existence or identity of anyone entitled to a benefit payment,
the Committee may rely conclusively upon information supplied by the Participant&#146;s
personal representative, executor or administrator. If a question arises as to the
existence or identity of anyone entitled to receive a benefit payment as aforesaid, or if
a dispute arises with respect to any such payment, then, notwithstanding the foregoing,
the Committee, in its sole and absolute discretion, may distribute such payment to the
Participant&#146;s estate without liability for any tax or other consequences which might
flow therefrom, or may take such other action as the Committee deems to be appropriate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>INFORMATION TO BE FURNISHED BY PARTICIPANTS AND BENEFICIARIES; INABILITY TO LOCATE
PARTICIPANTS OR BENEFICIARIES</U>. Any communication, statement or notice addressed to a
participant or to a Beneficiary at his or her last post office address as shown on the
Employer&#146;s records shall be binding on the Participant or Beneficiary for all
purposes of the Plan. The Committee shall not be obliged to search for any Participant or
Beneficiary beyond the sending of a registered letter to such last known address. If the
Committee notifies any Participant or Beneficiary that he or she is entitled to an amount
under the Plan and the Participant or Beneficiary fails to claim such amount or make his
or her location known to the Committee within three (3) years thereafter, then, except as
otherwise </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>13</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
required by law, if the location of one or more of the next of kin of the
Participant is known to the Committee, the Committee may direct distribution of such
amount to any one or more or all of such next of kin, and in such proportions as the
Committee determines. If the location of none of the foregoing persons can be determined,
the Committee shall have the right to direct that the amount payable shall be deemed to be
a forfeiture, except that the dollar amount of the forfeiture, unadjusted for deemed gains
or losses in the interim, shall be paid by the Company if a claim for the benefit
subsequently is made by the Participant or Beneficiary to whom it was payable. If a
benefit payable to an unlocated Participant or Beneficiary is subject to escheat pursuant
to applicable state law, the Company shall not be liable to any person for any payment
made in accordance with such law. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A020></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 8</U> </FONT></P>

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<A NAME=A021></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ADMINISTRATION</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>ADMINISTRATIVE AUTHORITY</U>. Except as otherwise specifically provided herein, the
Committee, in its sole and absolute discretion, shall have the sole responsibility for and
the sole control of the operation and administration of the Plan, and shall have the power
and authority to take all action and to make all decisions and interpretations which may
be necessary or appropriate in order to administer and operate the Plan, including,
without limiting the generality of the foregoing, the power, duty and responsibility to: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Resolve and determine all disputes or questions arising under the Plan, and
          to remedy any ambiguities, inconsistencies or omissions in the Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adopt
such rules of procedure and regulations as in its opinion may be necessary for the proper
and efficient administration of the Plan and as are consistent with the Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Implement
the Plan in accordance with its terms and the rules and regulations adopted as above. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Make
determinations concerning the crediting of Plan Accounts. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Appoint
any persons or firms, or otherwise act to secure specialized advice or assistance, as it
deems necessary or desirable in connection with the administration and operation of the
Plan, and the Committee shall be entitled to rely conclusively upon, and shall be fully
protected in any action or omission taken by it in good faith reliance upon, the advice or
opinion of such firms or persons. The Committee shall have the power and authority to
delegate from time to time all or any part of its duties, powers or responsibilities under
the Plan, both ministerial and discretionary, as it deems appropriate, to any person or
sub-committee, and in the same manner to revoke any such delegation of duties, powers or
responsibilities. Any action of such person or sub-committee in the exercise of such
delegated duties, powers or responsibilities shall have the same force and effect for all
purposes hereunder as if such action had been taken by the Committee. Further, the
Committee may authorize one or more persons to execute any </FONT></P>


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<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
certificate or document on
behalf of the Committee, in which event any person notified by an Employer of such
authorization shall be entitled to accept and conclusively rely upon any such certificate
or document executed by such person as representing action by the Committee until such
notified person shall have been notified of the revocation of such authority. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>UNIFORMITY OF DISCRETIONARY ACTS</U>. Whenever in the administration or operation of
the Plan discretionary actions by the Committee are required or permitted, such actions
shall be consistently and uniformly applied to all persons similarly situated, and no such
action shall be taken which shall discriminate in favor of any particular person or group
of persons. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>LITIGATION</U>. Except as may be otherwise required by law, in any action or judicial
proceeding affecting the Plan, no Participant or Beneficiary shall be entitled to any
notice or service of process, and any final judgment entered in such action shall be
binding on all persons interested in, or claiming under, the Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4&nbsp;&nbsp;&nbsp;&nbsp;
<U>CLAIMS PROCEDURE</U>. Any person claiming a benefit under the Plan (a
&#147;Claimant&#148;) shall present the claim, in writing, to the Plan Manager, and the
Plan Manager shall respond in writing. If the claim is denied, the written notice of
denial shall state, in a manner calculated to be understood by the Claimant: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The
specific reason or reasons for the denial, with specific references to the Plan provisions
on which the denial is based; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;A
description of any additional material or information necessary for the Claimant to
perfect his or her claim and an explanation of why such material or information is
necessary; and </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;An
explanation of the Plan&#146;s claims review procedure including a statement of the
claimant&#146;s right to bring a civil action under Section 502(a) of ERISA following an
adverse benefit determination on review. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
written notice denying or granting the Claimant&#146;s claim shall be provided to the
Claimant within ninety (90) days after the Plan Manager&#146;s receipt of the claim,
unless special circumstances require an extension of time for processing the claim. If
such an extension is required, written notice of the extension shall be furnished by the
Plan Manager to the Claimant within the initial ninety (90) day period and in no event
shall such an extension exceed a period of ninety (90) days from the end of the initial
ninety (90) day period. Any extension notice shall indicate the special circumstances
requiring the extension and the date on which the Plan Manager expects to render a
decision on the claim. Any claim not granted or denied within the period noted above shall
be deemed to have been denied. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
Claimant whose claim is denied, or deemed to have been denied under the preceding sentence
(or such Claimant&#146;s authorized representative), may, within sixty (60) days after the
Claimant&#146;s receipt of notice of the denial, or after the date of the deemed denial,
request a review of the denial by notice given, in writing, to the Committee. Upon such a
request for</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
review, the claim shall be reviewed by the Committee (or its designated
representative) which may, but shall not be required to, grant the Claimant a hearing. In
connection with the review, the Claimant may have representation, may examine pertinent
documents, and may submit issues and comments in writing. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
decision on review normally shall be made within sixty (60) days of the Committee&#146;s
receipt of the request for review. If an extension of time is required due to special
circumstances, the Claimant shall be notified, in writing, by the Committee, and the time
limit for the decision on review shall be extended to one hundred twenty (120) days. The
decision on review shall be in writing and shall state, in a manner calculated to be
understood by the Claimant, the specific reasons for the decision and shall include
references to the relevant Plan provisions on which the decision is based. The written
decision on review shall be given to the Claimant within the sixty (60) day (or, if
applicable, the one hundred twenty (120) day) time limit discussed above. If the decision
on review is not communicated to the Claimant within the sixty (60) day (or, if
applicable, the one hundred twenty (120) day) period discussed above, the claim shall be
deemed to have been denied upon review. All decisions on review shall be final and binding
with respect to all concerned parties. </FONT></P>

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<A NAME=A022></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 9</U> </FONT></P>

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<A NAME=A023></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>AMENDMENT</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>RIGHT TO AMEND</U>. The Company, by written instrument executed by the Company, shall
have the right to amend the Plan, at any time and with respect to any provisions hereof,
and all parties hereto or claiming any interest hereunder shall be bound by such
amendment; provided, however, that no such amendment shall deprive a Participant or a
Beneficiary of a right accrued hereunder prior to the date of the amendment. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>AMENDMENTS TO ENSURE PROPER CHARACTERIZATION OF PLAN</U>. Notwithstanding the
provisions of Section 9.1, the Plan may be amended by the Company at any time,
retroactively if required, if found necessary, in the opinion of the Company, in order to
ensure that the Plan is characterized as a &#147;top-hat&#148; plan of deferred
compensation maintained for a select group of management or highly compensated employees
as described under ERISA sections 201(2), 301(a)(3), and 401(a)(1), and to conform the
Plan to the provisions and requirements of any applicable law (including ERISA and the
Code). No such amendment shall be considered prejudicial to any interest of a Participant
or a Beneficiary hereunder. </FONT></P>

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<A NAME=A024></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 10</U> </FONT></P>

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<A NAME=A025></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>TERMINATION</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERMINATION OR SUSPENSION OF PLAN</U>. Each Employer reserves the right to terminate
the Plan as to some or all of its Eligible Employees and/or its obligation to make further
credits to Plan Accounts. The Company reserves the right to suspend the operation </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>16</FONT></P>
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<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
of the
Plan for a fixed or indeterminate period of time; provided, however, that during any
period of suspension, the Accounts of Participants shall continue to be credited or
debited, as applicable, with deemed investment return pursuant to Article 4. In the event
of a termination of the Plan, the Company reserves the right to distribute
Participants&#146; Accounts provided that such distribution is in compliance with Code
Section 409A and the regulations and guidance thereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERMINATION OF PLAN ON DISSOLUTION OR CHANGE IN CONTROL</U>. The Plan automatically
shall terminate upon the dissolution of the Company taxed under Code Section 331. In the
event of a Change in Control, the Plan shall automatically terminate. On termination of
the Plan, the provisions of Section 10.4 shall become operative. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>SUSPENSION OF DEFERRALS</U>. In the event of a suspension of the Plan, the Company and
the Employers shall continue all aspects of the Plan, other than Compensation Deferrals
and Employer Contribution Credits, during the period of the suspension, in which event the
allocation of deemed earnings and payments hereunder will continue to be made during the
period of the suspension in accordance with Articles 4, 5 and 6. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4&nbsp;&nbsp;&nbsp;&nbsp;
<U>ALLOCATION AND DISTRIBUTION</U>. This Section shall become operative on a termination
of the Plan as to some or all Eligible Employees, under Section 10.2. Upon the effective
date of any such event, notwithstanding any other provisions of the Plan, the value of the
interest of all affected Participants and Beneficiaries shall be determined and, after
deduction of estimated expenses in liquidating and, if applicable, paying Plan benefits,
paid to them by the Company in lump sum as soon as is practicable, by the end of the
calendar year in which the dissolution occurs or not later than 12 months following a
Change in Control. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5&nbsp;&nbsp;&nbsp;&nbsp;
<U>SUCCESSOR TO EMPLOYER</U>. Any corporation or other business organization which is a
successor to an Employer, which is an affiliate or subsidiary of the Company, by reason of
a Change in Control shall, with the consent of the Company, have the right to become a
party to the Plan by adopting the same by resolution of the entity&#146;s board of
directors or other appropriate governing body. If, within ninety (90) days from the
effective date of such consolidation, merger or sale of assets, such new entity does not
become a party hereto, as above provided, the Plan automatically shall be terminated as to
that Employer, and the provisions of Section 10.4 shall become operative. </FONT></P>

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<A NAME=A026></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 11</U> </FONT></P>

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<A NAME=A027></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>FUNDING</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>UNFUNDED OBLIGATION</U>. The Company&#146;s obligation under the Plan is an unsecured
and unfunded promise to pay benefits. The Company shall have no obligation to set aside,
earmark, or entrust any fund or money with which to pay its obligations under this Plan.
The Participant, his beneficiary, or any successor in interest to him or her shall be and
remain simply a general creditor of the Company in the same manner as any other creditor
having a </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
general claim for matured and unpaid compensation with no right to any specific
assets owned by the Company. </FONT></P>

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<A NAME=A028></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 12</U> </FONT></P>

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<A NAME=A029></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>MISCELLANEOUS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1&nbsp;&nbsp;&nbsp;&nbsp;
<U>LIMITATIONS ON LIABILITY OF EMPLOYERS</U>. Neither the establishment of the Plan nor
any modification thereof, nor the creation of any account under the Plan, nor the payment
of any benefits under the Plan shall be construed as giving to any Participant or other
person any legal or equitable right against any Employer, or any officer or employee
thereof except as provided by law or by any Plan provision. Neither the Company nor any
Employer in any way guarantees any Participant&#146;s Account from loss or depreciation,
whether caused by poor investment performance or the inability to realize upon an
investment due to an insolvency affecting an investment vehicle or any other reason. In no
event shall the Company, an Employer, or any successor, employee, officer, director or
stockholder of the Company or an Employer, be liable to any person on account of any claim
arising by reason of the provisions of the Plan or of any instrument or instruments
implementing its provisions, or for the failure of any Participant, Beneficiary or other
persons to be entitled to any particular tax consequences with respect to the Plan, or any
credit or distribution hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2&nbsp;&nbsp;&nbsp;&nbsp;
<U>CONSTRUCTION</U>. If any provision of the Plan is held to be illegal or void, such
illegality or invalidity shall not affect the remaining provisions of the Plan, but shall
be fully severable, and the Plan shall be construed and enforced as if said illegal or
invalid provision had never been inserted herein. For all purposes of the Plan, where the
context admits, the singular shall include the plural, and the plural shall include the
singular. Headings of Articles and Sections herein are inserted only for convenience of
reference and are not to be considered in the construction of the Plan. The laws of the
State of Maryland shall govern, control and determine all questions of law arising with
respect to the Plan and the interpretation and validity of its respective provisions,
except where those laws are preempted by the laws of the United States. Participation
under the Plan will not give any Participant the right to be retained in the service of an
Employer nor any right or claim to any benefit under the Plan unless such right or claim
has specifically accrued hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Plan is intended to be and at all times shall be interpreted and administered so as to
qualify as an unfunded deferred compensation plan, and no provision of the Plan shall be
interpreted so as to give any individual any right in any assets of the Company which
right is greater than the rights of a general unsecured creditor of the Company. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Plan is intended to be a &#147;top-hat&#148; plan under ERISA. In the event the Committee
determines that the participation of certain individuals as Eligible Employees under the
Plan causes the Plan to fail to qualify as a &#147;top-hat&#148; plan, the Committee, in
its sole and absolute direction, is authorized to take whatever action it deems necessary
to preserve the status of the Plan as a &#147;top-hat&#148; plan, including, but not
limited to, termination of an otherwise eligible employee&#146;s participation in the Plan
and (notwithstanding any provisions of the Plan to the contrary) immediate distribution of
such individual&#146;s Account. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Plan is intended to comply with Section 409A of the Internal Revenue Code of 1986, as
amended, and any regulations or guidance issued thereunder, and shall be interpreted
accordingly. Any provision of the Plan not in conformance with Section 409A shall be void
as of January 1, 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.3&nbsp;&nbsp;&nbsp;&nbsp;
<U>SPENDTHRIFT PROVISION</U>. No amount payable to a Participant or a Beneficiary under
the Plan will, except as otherwise specifically provided by law, be subject in any manner
to anticipation, alienation, attachment, garnishment, sale, transfer, assignment (either
at law or in equity), levy, execution, pledge, encumbrance, charge or any other legal or
equitable process, and any attempt to do so will be void; nor will any benefit be in any
manner liable for or subject to the debts, contracts, liabilities, engagements or torts of
the person entitled thereto. Further, (i) the withholding of taxes from Plan benefit
payments, (ii) the recovery under the Plan of overpayments of benefits previously made to
a Participant or Beneficiary, (iii) if applicable, the transfer of benefit rights from the
Plan to another plan, or (iv) the direct deposit of benefit payments to an account in a
banking institution (if not actually part of an arrangement constituting an assignment or
alienation) shall not be construed as an assignment or alienation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event that any Participant&#146;s or Beneficiary&#146;s benefits hereunder are
garnished or attached by order of any court, the Company or Trustee may bring an action or
a declaratory judgment in a court of competent jurisdiction to determine the proper
recipient of the benefits to be paid under the Plan. During the pendency of said action,
any benefits that become payable shall be held as credits to the Participant&#146;s or
Beneficiary&#146;s Account or, if the Company prefers, paid into the court as they become
payable, to be distributed by the court to the recipient as the court deems proper at the
close of said action. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused the Plan to be executed and its seal to be affixed
hereto, effective as of this 21st day of December, 2005. </FONT></P>



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<TR VALIGN="TOP">
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ATTEST/WITNESS<BR><BR><U>/s/ LUCY P. BOSLEY
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
Print: Lucy P. Bosley&nbsp;&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assistant Secretary</FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ CHARLES E. FENTON&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>(SEAL)                          <BR>
Print Name: Charles E. Fenton&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Date: December 21, 2005
</FONT></TD></TR>
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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>12
<FILENAME>form10k12312005l.htm
<DESCRIPTION>EXHIBIT 10(P)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (p)<BR><BR><BR><BR><BR><BR><BR><BR></B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>THE BLACK &amp; DECKER <BR>SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN</I></B></FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Supplemental Executive Retirement Plan provides certain supplemental
retirement benefits for selected executive employees of The Black &amp; Decker Corporation
and its subsidiaries and affiliates. This Plan is intended to provide supplemental
retirement benefits primarily for a select group of management and highly paid executive
employees. </FONT></P>

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<A NAME=A003></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 1 &#151;
Definitions</B></I> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
of the following terms in this Plan has the meaning indicated, unless a different meaning
is plainly implied by the context: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Accelerated
Payment Method&#148;</I> </B>means one of the methods of payment described in Section
7(c). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Actuarial
Equivalent&#148;</I></B><I></I> means a benefit having the same actuarial value, based on
the actuarial assumptions used in calculating benefits under The Black &amp; Decker
Pension Plan, and such other reasonable actuarial assumptions and methods that may be
adopted by the Committee from time to time, in its sole discretion, for use in determining
benefits under this Plan. Notwithstanding the foregoing, in the event a Participant has
elected to receive an Accelerated Payment Method, the amount of the lump sum payment or
installment payments (including the spouse&#146;s benefit) shall be calculated (A) using
(i) an interest rate equal to four and one-half percent (4.5%) and (ii) the 1994 Group
Annuity Reserving Table (determined on a unisex basis and projected to 2002, all as
described in <I>IRS Revenue Ruling 2001-62</I>); (B) assuming that (i) the Participant
will earn no wages subject to the Social Security Act, (ii) the Participant will not
further accrue any Other Retirement Benefits after his or her Benefit Commencement Date,
(iii) the Participant&#146;s Social Security retirement benefits and all Other Retirement
Benefits will begin at the earliest date they are available after the Participant&#146;s
Benefit Commencement Date, and (iv) the Participant, if married, will elect the form of
payment for the Other Retirement Benefits that provides his or her spouse the largest
benefit following the Participant&#146;s death; and (C) using such other reasonable
actuarial assumptions and methods that may be adopted by the Committee from time to time,
in its sole discretion, for this purpose. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Benefit
Commencement Date&#148;</I></B><I></I> means (A) in the case of a Participant who is not a
Protected Participant, the later of the date at which the Participant&#146;s Credited
Service ends or the date the Participant attains age 55 and five years of Credited Service
and (B) in the case of a Protected Participant, the later of the date at which his or her
Credited Service ends or the Participant&#146;s 55<SUP>th</SUP> birthday. Notwithstanding
the foregoing, if a Participant&#146;s Separation from Service occurs due to Disability
prior to the Participant&#146;s Normal Retirement Date, the Participant&#146;s Benefit
Commencement Date shall mean the Participant&#146;s Normal Retirement Date. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Black
&amp; Decker&#148;</I></B><I></I> means the Corporation and all of its direct and indirect
subsidiaries and its affiliates. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>1</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Board&#148;</I></B><I></I>
means the Corporation&#146;s Board of Directors. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Change
in Control of the Corporation&#148;</I></B><I></I> means any of the following: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The acquisition by any one person or more than one person acting as a group of
          any of the Corporation&#146;s stock, if the sum of the stock so acquired plus
          the stock held by that person or group before the acquisition constitutes more
          than fifty percent (50%) of the total fair market value or total voting power of
          the stock of the Corporation and the stock held by that person or group
          immediately before that acquisition constituted fifty percent (50%) or less of
          the then total fair market value or total voting power of the stock of the
          Corporation. An increase in the percentage of the Corporation&#146;s stock owned
          by any one person or persons acting as a group as a result of a transaction in
          which the Corporation acquires its stock in exchange for property will be
          treated as an acquisition of stock for this purpose. This paragraph (A) only
          applies when there is a transfer of stock of the Corporation (or issuance of
          stock of the Corporation) and stock in the Corporation remains outstanding after
          the transaction. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The acquisition by any one person or more than one person acting as a group
          during the 12-month period ending on the most recent such acquisition by that
          person or group of ownership of stock of the Corporation possessing thirty-five
          percent (35%) or more of the total voting power of the stock of the Corporation
          and the stock held by that person or group immediately before that acquisition
          constituted less than thirty-five percent (35%) of the then total voting power
          of the stock of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          A majority of the members of the Board is replaced during any 12-month period by
          directors whose appointment or election is not endorsed by a majority of the
          members of the Board prior to the date of the appointment or election, provided
          that no other corporation is the majority stockholder of the stock of the
          Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The acquisition by any one person or more than one person acting as a group
          during the 12-month period ending on the most recent such acquisition by that
          person or group of assets of the Corporation that have a total gross fair market
          value equal to or more than forty percent (40%) of the total gross fair market
          value of all of the Corporation&#146;s assets immediately prior to such
          acquisition or acquisitions. For this purpose, gross fair market value means the
          value of the Corporation&#146;s assets, or the value of the assets being
          disposed of, determined without regard to any liabilities associated with those
          assets. There is no Change in Control of the Corporation under this Paragraph
          (D) when there is a transfer to an entity that is controlled by the shareholders
          of the Corporation immediately after the transfer. A transfer of assets will not
          qualify as a Change in Control of the Corporation under this Paragraph (D) if
          the assets are transferred to: (i) a shareholder of the Corporation immediately
          before the transfer in exchange for or with respect to the Corporation&#146;s
          stock; (ii) an entity, fifty percent (50%) or more of the total value or voting
          power of which is owned, directly or indirectly, by the Corporation; (iii) a
          person, or more than one person acting as a group, that owns, directly or
          indirectly, fifty percent (50%) or more of the total value or voting power of
          all of the outstanding stock of the Corporation; or (iv) an entity, at least
          fifty percent (50%) of the total value or voting power of which is owned,
          directly or indirectly, by a person, or more than one person acting as a </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>2</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
group,
          that owns, directly or indirectly, fifty percent (50%) or more of the total
          value or voting power of all of the outstanding stock of the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the purpose of interpreting this definition of &#147;Change in Control of the
Corporation,&#148; the following rules apply: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Persons will be considered as acting as a group only if they are owners of a
               corporation that enters into a merger, consolidation, purchase or acquisition of
               assets, or similar business transaction with the Corporation. If a person,
               including an entity shareholder, owns stock in the Corporation and the other
               corporation that enters into a merger, consolidation, purchase or acquisition of
               stock, or similar transaction with respect to the Corporation, that shareholder
               is considered to be acting as a group with other shareholders in a corporation
               only to the extent of the ownership in that corporation prior to the transaction
               giving rise to the Change in Control event and not with respect to the ownership
               interest in the other corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Ownership shall be determined taking into account the attribution rules set
               forth in Section 318(a) of the Code. Stock underlying a vested option is
               considered owned by the option holder and non-vested stock is not considered
               owned by the option holder. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If any one person, or more than one person acting as a group, is considered to
               effectively control the Corporation as described in Paragraphs (B) &amp; (C)
               above, the acquisition of additional control of the Corporation by the same
               person or persons is not considered to cause a change in the effective control
               of the Corporation or to cause a change in the ownership of the Corporation for
               the purposes of this definition. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Each Change in Control event described in this definition is intended to
               constitute a change in ownership or effective control of the Corporation or in
               the ownership of a substantial portion of the Corporation&#146;s assets within
               the meaning of Section 409A(a)(2)(A)(v) of the Code and the IRS guidance issued
               thereunder and this Plan shall be interpreted accordingly. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Code&#148;
</I></B><I></I>means the Internal Revenue Code of 1986, as amended from time to time, and
any successor to that statute. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Committee&#148;</I></B><I></I>
means the Compensation Committee of the Board. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Corporation&#148;</I></B><I></I>
means The Black &amp; Decker Corporation, a Maryland corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Credited
Service&#148;</I></B><I></I> means all Benefit Service Credit as defined in and credited
to the Participant under The Black &amp; Decker Pension Plan (or, if the Participant was
not eligible to participate in The Black &amp; Decker Pension Plan for any period of
employment by Black &amp; Decker, the Benefit Service Credit that would have been credited
under The Black &amp; Decker </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>3</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>






<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Pension Plan for that period of employment by Black &amp;
Decker, if the Participant had been eligible to participate in that plan) plus the
Participant&#146;s Salary Continuance Period. Except as credited under The Black &amp;
Decker Pension Plan or unless otherwise determined by the Committee in its sole
discretion, Credited Service under this Plan shall not include any period of employment
with any company during any period when that company was not a subsidiary or affiliate of
the Corporation. Credited Service also includes all periods of Disability beginning while
the Employee<B><I> </I></B><I></I>is employed by Black &amp; Decker and continuing as long
as the Disability continues up until the Participant&#146;s Normal Retirement Date.
Notwithstanding anything to the contrary, no loss of Credited Service will occur by reason
of an interruption in an Employee&#146;s period of Credited Service, regardless of the
length of that interruption, and no Participant shall receive duplicate Credited Service
for the same period of time, whether as a result of the terms of this Plan, The Black
&amp; Decker Pension Plan, any other plan provided or maintained by Black &amp; Decker, or
any individual agreement between the Participant and Black &amp; Decker. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Disability&#148;</I></B><I></I>
means an illness or injury that would cause the Employee to be disabled under the terms of
The Black &amp; Decker Disability Plan or that totally prevents the Employee from
satisfactorily performing the Employee&#146;s usual duties with Black &amp; Decker, as
determined by the Committee based on professional medical advice. The Committee may
require the Employee to submit from time to time to medical examinations by physicians
selected or approved by the Committee to establish the Disability or its continuation,
provided that those examinations may not be required more frequently than once each year.
The Employee&#146;s refusal to submit to any examination reasonably requested by the
Committee in accordance with this definition is grounds for the Committee to find that the
Employee&#146;s Disability no longer exists. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Early
Retirement Date&#148;</I></B><I></I> means the first day of the calendar month coincident
with or next following the date upon which the Participant has both attained age 55 and
five years of Credited Service; provided, however, that, in the case of a Protected
Participant, the Early Retirement Date shall be the first day of the calendar month
coincident with or next following the Protected Participant&#146;s 55<SUP>th</SUP>
birthday. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Effective
Date&#148;</I></B><I></I> means January 1, 2005, the effective date of this amended and
restated Plan. The Prior Plan was originally effective as of January 1, 1984. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Employee&#148;</I></B><I></I>
means any person rendering personal services to Black &amp; Decker as an employee. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Final
Average Pay&#148;</I></B><I></I> means the average monthly amount of the
Participant&#146;s Pay for the three years (whether or not consecutive) in which the
Participant&#146;s Pay was the highest out of each of the seven-year periods that end on
the following dates, whichever seven-year period produces the highest average: </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>4</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>








<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(A) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the Participant&#146;s Termination Date; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(B) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          if the Participant&#146;s Termination Date is not December 31<SUP>st</SUP> of
          any given year, the December 31<SUP>st </SUP> immediately preceding the
          Participant&#146;s Termination Date; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(C) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the last day of the Participant&#146;s Salary Continuance Period, if applicable; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(D) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          if the last day of the Participant&#146;s Salary Continuance Period is not
          December 31<SUP>st</SUP> of any given year, the December 31<SUP>st</SUP>
          immediately preceding the last day of the Participant&#146;s Salary Continuance
          Period, if applicable; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(E) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          in the case of a Protected Participant only, the date of the applicable Change
          in Control of the Corporation; and </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(F) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          in the case of a Protected Participant only, if the date of the applicable
          Change in Control of the Corporation is not December 31<SUP>st</SUP> of any
          given year, the December 31<SUP>st</SUP> immediately preceding the date of the
          applicable Change in Control of the Corporation. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Monthly
Benefit&#148;</I></B><I></I> means the amount determined under Section 3(a) as reduced by
Sections 3(b) and 3(c). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Normal
Retirement Date&#148;</I></B><I></I> means the first day of the calendar month coincident
with or next following the date upon which the Participant attains age 60 and 5 years of
Credited Service; provided, however, that, in the case of a Protected Participant, the
Normal Retirement Date shall be the first day of the calendar month coincident with or
next following the Participant&#146;s 60th birthday, regardless of his or her Credited
Service. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Other
Retirement Benefits&#148;</I></B><I></I> means the amount (actuarially adjusted, as
described below) of all retirement, disability income and death benefits, or the like,
whether tax-qualified or non-qualified, that the Participant or the Participant&#146;s
surviving spouse is entitled to receive in the applicable month under all plans or
arrangements provided, maintained or funded, in part or in whole, by any of the
Participant&#146;s employers or former employers (whether or not affiliated with Black
&amp; Decker), including all Social Security Benefits, but excluding: (A) any portion of
those retirement, disability income or death benefits (other than Social Security
Benefits) that is attributable to the Participant&#146;s contributions, including
contributions made by the Participant&#146;s employer pursuant to a salary reduction
agreement with the Participant (such as under The Black &amp; Decker Executive Deferred
Compensation Plan or The Black &amp; Decker Supplemental Retirement Savings Plan); (B) any
death benefits under a life insurance contract with a life insurance company; (C) any
defined contribution pension, profit sharing or stock bonus plan, unless that plan is
intended to provide the primary source of retirement income (in addition to Social
Security Benefits) funded by Black &amp; Decker or any other employer for the employees at
any location covered by that plan; (D) any payments to the Participant (including any
&#147;parachute payments&#148; within the meaning of Section 280G of the Code) made
pursuant to an individual agreement in writing between the Participant and Black &amp;
Decker and as a result of a change in the ownership or effective control of the
Corporation or a change in the ownership of a </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>5</FONT></P>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
substantial portion of the
Corporation&#146;s assets; (E) any amounts paid under an individual written agreement
between the Participant and Black &amp; Decker which agreement expressly refers to this
Plan and provides that those amounts shall not reduce the benefits under this Plan or
otherwise are in addition to the benefits payable under this Plan; and (F) any amount that
constitutes Pay, as defined in this Plan. Notwithstanding anything to the contrary, the
amount of the Participant&#146;s or spouse&#146;s Other Retirement Benefits in any month
shall be increased or decreased so that the amount of those Other Retirement Benefits
offset against the monthly benefit payable under this Plan is the Actuarial Equivalent of
the Other Retirement Benefits that the Participant or spouse could or would otherwise have
received that month but for the Participant&#146;s or spouse&#146;s election: (A) to
accelerate payment of those Other Retirement Benefits to a date that precedes the date
benefit payments commenced to the Participant or spouse under this Plan, (B) to defer the
commencement of payment of those Other Retirement Benefits beyond the earliest date those
payments could or would otherwise have been made, if that date is later than the date
benefit payments under this Plan commenced to the Participant or spouse or (C) to receive
those Other Retirement Benefits in any form of payment other than the available form of
payment that would have provided the largest monthly benefit to the Participant or spouse,
unless, and only to the extent that, the elected form of payment provides benefits to the
Participant&#146;s spouse after the Participant&#146;s death. Whether an actuarial
adjustment to the Participant&#146;s or spouse&#146;s Other Retirement Benefits is
appropriate and the amount of that adjustment is to be determined by the Committee, in its
sole discretion, based on the actuarial assumptions in effect when that adjustment is
first determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Participant&#148;</I></B><I></I>
means any Employee who qualifies for participation in this Plan, as more particularly
described in Section 2. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B><I>Pay</I></B><I></I>&#148;
means (A) the actual compensation paid during the relevant period by Black &amp; Decker to
the Participant for services as an Employee, including basic salary, bonuses, and annual
incentive awards, (B) any amounts contributed to any employee benefit plan pursuant to a
salary or other compensation reduction agreement with the Participant, and including, for
the year of deferral, amounts deferred by the Participant under any nonqualified deferred
compensation plan (such as The Black &amp; Decker Executive Deferred Compensation Plan and
The Black &amp; Decker Supplemental Retirement Savings Plan), (C) salary continuation
payments during sick leave and other authorized leaves of absence (other than long-term
disability benefits) and (D) the Participant&#146;s Salary Continuance Payments. For the
purpose of determining the amount of the Participant&#146;s Salary Continuance Payments
that constitutes Pay for any given period, the Participant&#146;s total Salary Continuance
Payments shall be credited as Pay ratably over the Participant&#146;s Salary Continuance
Period. The term &#147;Pay&#148; does not include any (A) long-term incentive awards or
other amounts paid pursuant to any long-range performance compensation plan, (B) amounts
paid pursuant to The Black &amp; Decker Performance Equity Plan, (C) any non-cash
remuneration, imputed income (including income imputed under any group life insurance
program), perquisites and other cash or non-cash fringe benefits, such as (but not limited
to) reimbursements or allowances for expenses (such as automobile, moving or relocation,
country club, tax preparation, overseas housing, educational and similar expense
allowances), (D) contributions to or benefits under any employee pension or welfare
benefit plan or payments received by a Participant under any non-qualified deferred
compensation plan (such as The Black &amp; Decker Executive Deferred Compensation Plan or
The Black &amp; Decker </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Supplemental Retirement Savings Plan), (E) stock bonuses, income
attributable to discount stock purchases, stock options or stock appreciation rights, (F)
income attributable to the vesting of restricted property or benefits under any plan or
arrangement, or (G) allowances for or the provision of counseling or other personal
services (such as financial and tax counseling). For any period during which the
Participant is entitled to Credited Service by reason of a Disability, the
Participant&#146;s Pay is deemed to continue during that Disability period at a monthly
rate equal to 1/12th of (i) the Participant&#146;s basic salary (before any salary
reduction for contributions to any employee benefit plan pursuant to a salary reduction
agreement with the Participant) at the Participant&#146;s annual salary rate in effect at
the date that the Disability began, plus (ii) all items (other than basic salary and such
salary reduction contributions) included in the Participant&#146;s actual Pay during the
12-month period ending on the date that the Disability began. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Payment
Date&#148;</I></B><I></I> means the latest of the Participant&#146;s Benefit Commencement
Date, the date that is six (6) months and one (1) day after the Participant&#146;s
Separation from Service or, if the Participant has elected to defer his or her Payment
Date pursuant to Section 7(c), the Payment Date so elected by the Participant.
Notwithstanding anything to the contrary, under all circumstances a Participant&#146;s
benefits shall be paid or commence to be paid to a Participant no earlier nor later than
the Participant&#146;s Payment Date, which shall not occur earlier than the date six (6)
months and one day after the date of the Participant&#146;s Separation from Service,
except that (i) the death benefits payable to a Participant&#146;s spouse shall be paid at
the date specified in Section 5(b)<B> </B>and (ii) in the case of a Participant whose
Payment Date would otherwise have occurred at any time in the 2005 calendar year and who
elects during the 2005 calendar year to receive the Accelerated Payment Method, the
Payment Date for that lump sum payment or those installment payments shall be deemed to be
the later of the first day of the calendar month after the date that election to
accelerate is filed with the Plan or the date six months and one day immediately after the
Participant&#146;s Separation from Service with Black &amp; Decker. Notwithstanding
anything to the contrary, if the Committee reasonably determines that the making of any
payment to a Participant under this Plan will violate Federal securities laws or other
applicable law, the Committee may delay a Participant&#146;s Benefit Commencement Date
until the earliest date at which the Committee determines that the making of that payment
will not violate those laws. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B><I>Plan</I></B><I></I>&#148;
means this document, entitled &#147;The Black &amp; Decker Supplemental Executive
Retirement Plan,&#148; as it may be amended from time to time. This document completely
amends and restates The Black &amp; Decker Supplemental Executive Retirement Plan
originally effective on January 1, 1984, and last amended and restated effective as of
April 27, 2004 (all versions of the Plan in effect before the Effective Date are referred
to in this Plan as the &#147;Prior Plan&#148;). Notwithstanding anything to the contrary,
the benefits under this Plan with respect to any Participant whose Termination Date
occurred prior to the Effective Date shall be determined under the terms of the Prior Plan
as in effect at that Participant&#146;s Termination Date, without regard to any amendments
made to the Plan thereafter. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Protected
Participant&#148;</I></B><I></I> means a Participant who is an Employee when a Change in
Control of the Corporation occurs. </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Salary
Continuance Payments&#148;</I></B><I></I> means (A) in the case of a Participant who is a
participant in the Salary Continuance Plan, the maximum &#147;Salary Continuance&#148;
payments (as defined in the Salary Continuance Plan), if any, that the Participant may be
eligible to receive under the Salary Continuance Plan; (B) all payments, if any, that are
in lieu of future compensation items that would otherwise constitute &#147;Pay&#148; under
the terms of this Plan and that the Participant may be entitled to receive, under the
terms of any individual agreement in writing between the Participant and Black &amp;
Decker, as a result of the termination of his or her employment with Black &amp; Decker
(whether by action of Black &amp; Decker or the Participant); and (C) in the case of a
Protected Participant, all payments, if any, that are in lieu of future compensation items
that would otherwise constitute &#147;Pay&#148; under the terms of this Plan and that the
Protected Participant may be entitled to receive under the terms of any individual
agreement between the Participant and Black &amp; Decker as a result of the termination of
the Participant&#146;s employment with Black &amp; Decker (whether by action of Black
&amp; Decker or the Participant) coincident with or following a change in the ownership or
effective control of the Corporation or a change in the ownership of a substantial portion
of the Corporation&#146;s assets. In all cases, a Participant&#146;s entitlement to Salary
Continuance Payments and the amount thereof shall be determined at his or her Termination
Date, before any offset for severance pay, vacation pay, salary continuance, notice pay, a
termination indemnity or the like or compensation received from a subsequent employer,
without regard to whether those payments are made in one lump sum payment or periodically
and without regard to the amount of severance or salary continuance that is actually paid
to the Participant thereafter. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Salary
Continuance Period&#148;</I></B><I></I> means the maximum period with respect to which the
Participant&#146;s Salary Continuance Payments are to be measured under the terms of the
Salary Continuance Plan or applicable individual agreement, determined at the
Participant&#146;s Termination Date, without regard to the actual period over which those
payments may be made and without regard to whether those payments are made in one lump sum
payment or periodically. Notwithstanding anything to the contrary, a Participant&#146;s
Salary Continuance Period will be taken into account under this Plan only if the
Participant is entitled to Salary Continuance Payments at his or her Termination Date. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Salary
Continuance Plan&#148;</I></B><I></I> means The Black &amp; Decker Executive Salary
Continuance Plan, effective May 1, 1995, as amended from time to time, or any salary
continuance plan that is a successor to, or replacement for, that plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B><I>Separation
from Service&#148;</I></B><I></I> means a separation from service within the meaning of
Section 409A(a)(2)(A)(i) of the Code. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>&#147;Social
Security Benefit&#148;</I></B><I></I> means the retirement, disability income or death
benefits under any plan or arrangement that is sponsored, mandated or administered by any
government and that provides or would provide retirement or disability income to the
Participant and to which any of the Participant&#146;s employers or former employers
(whether or not affiliated with Black &amp; Decker) has made contributions on the
Participant&#146;s behalf. </FONT></P>


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<DIV STYLE="page-break-after:always"></DIV>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B><I>Termination
Date&#148;</I></B><I></I> means the last date on which the Participant is actively
employed by, and renders services to, Black &amp; Decker as an Employee prior to his or
her termination of employment with Black &amp; Decker (whether by action of Black &amp;
Decker or the Participant). </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>&nbsp;&nbsp;&nbsp;<B>SECTION
2 &#151; Eligibility</B></I> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
management or highly paid executive employee may be selected for participation in this
Plan by the Committee or any other committee of the Board designated by the Board for such
purpose and will automatically become a Participant on the date designated by that
committee. Any Employee who was still employed by Black &amp; Decker and was a Participant
in the Prior Plan immediately prior to the Effective Date shall continue as a Participant
under this Plan without further action by the Board or any such committee. </FONT></P>


<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>&nbsp;&nbsp;&nbsp;<B>SECTION
3 &#151; Retirement Benefit</B></I> </FONT></P>




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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Benefit Percentage</I></B><I></I>. Any Participant whose Credited Service
          with Black &amp; Decker terminates at or after the Participant&#146;s Early
          Retirement Date or, in the case of a Protected Participant, whose Credited
          Service with Black &amp; Decker terminates at any time, whether before or after
          his or her Early Retirement Date, is entitled to receive under this Plan a
          monthly benefit beginning on the Participant&#146;s Payment Date and continuing
          for the Participant&#146;s life that is the Actuarial Equivalent of the Monthly
          Benefit that would begin on the first day of the calendar month after the
          Participant&#146;s Benefit Commencement Date and would continue for the
          Participant&#146;s expected life. The amount of the Monthly Benefit (before the
          reductions in Sections 3(b) and 3(c)) is to be equal to: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(A) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               50% of his or her Final Average Pay, in the case of a Participant (other than a
               Protected Participant) who has less than fifteen (15) years of Credited Service; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(B) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               60% of his or her Final Average Pay, in the case of a Participant (other than a
               Protected Participant) who has at least fifteen (15) years of Credited Service;
               and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(C) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               60% of his or her Final Average Pay, in the case of a Protected Participant. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Reduction for Early Commencement.</I></B><I></I>. Notwithstanding anything
               to the contrary, in any case where the Participant&#146;s Benefit Commencement
               Date occurs before his or her Normal Retirement Date, the Monthly Benefit, as
               determined under Section 3(a), shall be reduced by one-twelfth
               (1/12<SUP>th</SUP>) of 2 percentage points of Final Average Pay for each full
               calendar month by which the Participant&#146;s Benefit Commencement Date
               precedes the Participant&#146;s Normal Retirement Date.  </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Reduction for Less than 10 Years of Service</I></B><I></I>. Notwithstanding anything to the contrary in this Plan, if a Participant (other
               than a Protected Participant) has less than 10 years of Credited Service at the
               Participant&#146;s Benefit Commencement Date, the Monthly Benefit determined
               under Section 3(a), as reduced by any reduction required under Section 3(b) and
               before any offsets under Section 4, is to be multiplied by a fraction, the
               numerator of which  </FONT></P>






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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
equals the Participant&#146;s years of Credited Service
               (including fractional years) and the denominator of which equals 10 years. This
               Section 3(c) shall not apply in the case of a Protected Participant. </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Benefit Examples</I></B><I></I>. Examples of the Monthly Benefit, as
               determined under this Section 3, are set forth in Schedule I attached to this
               Plan and incorporated into this Plan by this reference.  </FONT></P>



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<A NAME=A006></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 4 &#151; Benefit
Offsets</I></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary, the amount of the Participant&#146;s benefit each month, as
determined under Section 3, and as reduced by any reduction required under Sections 3(b)
and 3(c), or the amount of the Participant&#146;s surviving spouse&#146;s benefit under
Section 5 is to be further reduced by the Other Retirement Benefits payable to the
Participant or spouse during that month.<B><I> </I></B><I></I>In the event that the Other
Retirement Benefits for any month exceed the monthly benefit payment for that month under
this Plan, determined under Section 3 or Section 5, such excess shall be carried over and
added to the Other Retirement Benefits for subsequent months, so that it is offset against
subsequent monthly benefit payments under this Plan until such excess is exhausted. The
offsets to the Participant&#146;s or spouse&#146;s benefits under this Section 4 are not
to be increased to reflect any increase in Other Retirement Benefits attributable to
increases in the cost-of-living after the Other Retirement Benefits commence and no
benefit is payable to the Participant or spouse in any month when those Other Retirement
Benefits (including carry-overs from prior months) exceed the monthly benefit amount
determined under Section 3, as reduced under Sections 3(b) and 3(c), or in the
spouse&#146;s case, the benefit determined under Section 5. Notwithstanding anything to
the contrary, if the Participant returns to Credited Service after his or her Benefit
Commencement Date, then the Participant&#146;s benefits under this Plan shall be
recomputed at the Participant&#146;s subsequent Separation from Service and shall be
reduced by the Actuarial Equivalent of any benefits previously paid under this Plan to the
Participant and/or his or her spouse and shall again become payable in accordance with
Section 3. The Committee will decide, in its sole discretion, the manner in which these
offsets are to be applied. </FONT></P>

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<A NAME=A007></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 5 &#151; Death
Benefits</B></I> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
benefits under this Plan are payable after the Participant&#146;s death except as
otherwise provided in this Section 5 or Section 7(c). </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Eligibility for Death Benefit</I></B><I></I>. In the case of a Participant
          (other than a Protected Participant) who dies before attaining age 55 and five
          years of Credited Service, no benefits under this Plan are payable after the
          Participant&#146;s death. In the case of a Participant (other than a Protected
          Participant) who dies after attaining age 55 and five years of Credited Service,
          the Participant&#146;s surviving spouse, if any, is entitled to receive the
          spouse&#146;s death benefit described in Section 5(b). In the case of any
          Protected Participant who dies at any time, the Protected Participant&#146;s
          surviving spouse, if any, is entitled to receive the spouse&#146;s death benefit
          described in Section 5(b). The Participant&#146;s spouse who is entitled to
          receive the payment(s) under this Section 5 shall be the person, if any, of the
          opposite sex to whom the Participant is legally </FONT></P>



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<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
married at the
          Participant&#146;s Benefit Commencement Date or the Participant&#146;s death,
          which ever happens first. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Spouse&#146;s Death Benefit.</I></B><I></I> The spouse&#146;s death
          benefit under this Section 5(b) shall be a monthly payment for the spouse&#146;s
          life beginning on the first day of the calendar month coincident with or
          immediately following the date of the Participant&#146;s death (or, in the case
          of a Protected Participant only, the date that would have been the Protected
          Participant&#146;s 55<SUP>th</SUP> birthday, if later than his or her date of
          death). The amount of the spouse&#146;s monthly payment shall be equal to (i)
          one-half (50%) of the monthly benefit (determined under Section 3, but before
          the offsets under Section 4) that the Participant was receiving or would have
          been entitled to receive as of the date of the Participant&#146;s death minus
          (ii) the offsets under Section 4. </FONT></P>

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<A NAME=A008></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 6 &#151; Vesting</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>General</I></B><I></I>. Except in the case of a Protected Participant,
          upon termination of a Participant&#146;s Credited Service at any time for any
          reason before the Participant attains age 55 and five years of Credited Service,
          the Participant&#146;s (and the surviving spouse&#146;s) right to benefits under
          this Plan shall be completely forfeited. In the case of a Protected Participant
          or his or her surviving spouse, all of the Protected Participant&#146;s right to
          benefits under this Plan (except the surviving spouse&#146;s right to receive
          death benefits under Sections 5 and 7(c)) shall be completely forfeited if the
          Protected Participant dies before his or her Benefit Commencement Date. Except
          in the case of a Protected Participant and his or her surviving spouse, if this
          Plan is terminated by the Corporation on or after the Participant attains age 55
          and five years of Credited Service but before the Participant&#146;s Benefit
          Commencement Date, the Participant shall be entitled to receive the benefits
          under this Plan commencing at the Participant&#146;s Payment Date in the amount
          the Participant would have received under this Plan based on the
          Participant&#146;s Credited Service and Final Average Pay determined at this
          Plan&#146;s termination date, and the Participant&#146;s surviving spouse shall
          be entitled to receive the corresponding death benefit pursuant to Sections 5
          and 7(c). If this Plan is terminated or amended after a Change in Control of the
          Corporation, each Protected Participant who has not consented in writing to that
          termination or amendment shall be entitled to receive the benefits, commencing
          at his or her Payment Date, that is not less than the benefits the Protected
          Participant would have received, as a Protected Participant, if the Plan
          termination or amendment had not occurred and the Protected Participant&#146;s
          surviving spouse shall be entitled to receive the corresponding death benefit
          pursuant to Sections 5 and 7(c). The benefits described in this Section 6(a) and
          payable to the Participant or his or her spouse shall be paid pursuant to the
          applicable Accelerated Payment Method, if the Participant elected the
          Accelerated Payment Method under Section 7(c). </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Forfeiture for Cause</I></B><I></I>. Notwithstanding anything to the
          contrary, in the case of a Participant other than a Protected Participant, all
          of the Participant&#146;s (and surviving spouse&#146;s) rights and benefits
          under this Plan shall be forfeited: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               if the Participant&#146;s employment with Black &amp; Decker is terminated by
               reason of fraud, misappropriation or intentional material damage to the property
               or business of Black &amp; Decker; commission of a felony; or the continuance of
               a willful and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>11</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
repeated failure by the Participant to perform his or her duties
               after written notice to the Participant specifying such failure; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               if, during the period of 24 months beginning on his or her Termination Date, the
               Participant, without the Corporation&#146;s written consent, enters into
               competition with Black &amp; Decker or the Participant uses or discloses
               confidential information and shall immediately repay to the Corporation the full
               amount of any payments he or she received under this Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary, the provisions of this Section 6(b) shall not apply to the
rights and benefits under this Plan of a Protected Participant or the surviving spouse of
a Protected Participant. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Competition and Disclosure of Confidential Information</I></B><I></I>. For
          purposes of this Section 6, the Participant shall be deemed to be in competition
          with Black &amp; Decker if the Participant, directly or indirectly, solicits as
          a customer any company that is or was a customer of Black &amp; Decker during
          the Participant&#146;s employment, or that is or was a potential customer of
          Black &amp; Decker with which Black &amp; Decker has made business contacts
          during the Participant&#146;s employment; provided, however, that solicitation
          of a company as a customer of any business that is not in direct or indirect
          competition with any of the types of businesses conducted by Black &amp; Decker
          within any of the same territories as Black &amp; Decker conducts such
          businesses shall not be prohibited hereby. In addition, a Participant will be
          deemed to be in competition with Black &amp; Decker if the Participant directly
          or indirectly becomes an owner, officer, director, operator, sole proprietor,
          partner, joint venturer, contractor or consultant, or participates in or is
          connected with the ownership, operation, management or control of any company in
          direct or indirect competition with any of the types of businesses conducted by
          Black &amp; Decker within any of the same territories as Black &amp; Decker
          conducts such businesses; provided, however, that the ownership for investment
          of less than 5% of the outstanding stock of any of the classes of stock issued
          by a publicly held company shall not be deemed competition with Black &amp;
          Decker for purposes of this Section 6. The Participant shall be deemed to have
          disclosed &#147;confidential information&#148; if the Participant uses or fails
          to preserve as confidential, communicates, or discloses to any person, orally,
          in writing or by publication, any information, regardless of when, where or how
          acquired relating to or concerning the affairs of Black &amp; Decker to the
          actual or potential detriment of Black &amp; Decker; provided, however, that the
          foregoing obligations shall not apply to information that is or becomes public
          through no fault of the Participant. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Committee&#146;s Discretion</I></B><I></I>. The Committee shall have the
          absolute right to determine in its sole discretion (i) whether or not a
          Participant&#146;s employment was terminated as a result of an act described in
          Section 6(c), and (ii) whether or not a Participant has entered into competition
          with Black &amp; Decker or has disclosed confidential information so as to cause
          a forfeiture of the Participant&#146;s benefits hereunder. </FONT></P>

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<A NAME=A009></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 7 &#151;
Additional Provisions Concerning Benefits</B></I> </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Obligation to Inform</I></B><I></I>. The payments under this Plan are
          conditioned on the agreement of the Participant and the Participant&#146;s
          spouse (i) to inform the Committee of all</FONT></P>




<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>12</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>





<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
retirement, disability, Social
          Security, death benefit and other benefit payments received or receivable by
          them that may reduce the Corporation&#146;s obligations to pay benefits under
          this Plan and (ii) to provide all information about those payments that the
          Committee may reasonably request from time to time in order to administer this
          Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Currency and Exchange Rates</I></B><I></I>. The benefit payments under
          this Plan will be calculated in U.S. dollars using the appropriate currency
          exchange rate selected by the Committee in its sole discretion at the
          Participant&#146;s Payment Date. The benefits under this Plan will be paid to
          the Participant and the Participant&#146;s spouse in any currency designated by
          the Participant on or before the Participant&#146;s Payment Date (or, if the
          Participant dies before benefits commence, the currency designated by the
          spouse), based on the appropriate currency exchange rate (selected by the
          Committee in its sole discretion) in effect at the Participant&#146;s Payment
          Date. Once benefit payments under this Plan have begun, the currency selected by
          the Participant (or the Participant&#146;s spouse) and the applicable exchange
          rate may not be changed except to the extent that the Committee, in its sole
          discretion, may approve a change in order to prevent extreme financial hardship
          to the Participant or the Participant&#146;s spouse. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Election of Accelerated Payment Method.</I></B><I></I> Any Participant who
          is employed by Black &amp; Decker after September 1, 2005 (or who has a
          contractual right to elect a lump sum payment, should that election be offered
          under the Plan), may make an irrevocable election to receive, in lieu of the
          annuity benefits provided under this Plan, the Accelerated Payment Method of his
          or her benefits under this Plan described in Paragraphs (1) and (2) in this
          Section 7(c). Any Participant who makes the Accelerated Payment Method election
          on or after February 9, 2006, may, as a part of that election, irrevocably elect
          to defer his or her Payment Date to any date that is at least six (6) months and
          one day after the Participant&#146;s Separation from Service but not more than
          eighteen (18) months after his or her Separation from Service. The Accelerated
          Payment Method election shall be made in writing and signed by the Participant
          and must be received by the Plan Manager of The Black &amp; Decker Pension Plan
          on or before the earlier of the Participant&#146;s Benefit Commencement Date or
          December 31, 2006. Under all circumstances, once received by the Plan Manager,
          any Accelerated Payment Method election shall be irrevocable and shall apply to
          any benefits that become payable to the Participant and his or her spouse under
          this Plan. Notwithstanding anything to the contrary, if a Participant makes this
          election during the 2006 calendar year, the election shall not apply to any
          benefit payments the Participant would otherwise have received during the 2006
          calendar year and those payments shall be made at the time(s) they would
          otherwise have been paid during 2006. </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If the Participant&#146;s Payment Date occurs before his or her 65<SUP>th</SUP>
               birthday, the present value of the Participant&#146;s benefits under the Plan
               (including the spouse&#146;s benefit) shall be paid to him or her in five (5)
               equal annual installments that are the Actuarial Equivalent of the
               Participant&#146;s benefits under this Plan as of the Benefit Commencement Date
               (including any benefits for the Participant&#146;s spouse and after being
               reduced by the Actuarial Equivalent of all applicable benefit reductions and
               offsets), which installments shall be payable on the Participant&#146;s Payment
               Date and the next four successive anniversaries of the Participant&#146;s
               Payment Date, with those installment payments being calculated taking into
               account interest from the Benefit Commencement Date to the date of the last
               installment payment at the rate of four and one-half percent (4.5%). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>13</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If the Participant&#146;s Payment Date occurs on or after the Participant&#146;s
               65<SUP>th</SUP> birthday, the present value of the Participant&#146;s benefits
               under the Plan (including the spouse&#146;s benefit) shall be paid to him or her
               at the Payment Date in a lump sum payment that is the Actuarial Equivalent of
               the Participant&#146;s benefits under this Plan as of the Benefit Commencement
               Date (including any benefits for the Participant&#146;s spouse and after being
               reduced by the Actuarial Equivalent of all applicable benefit reductions and
               offsets). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In the event a Participant validly elects the Accelerated Payment Method and
               dies before his or her Separation from Service, the Participant&#146;s spouse,
               if any, shall receive the Actuarial Equivalent of the spouse&#146;s death
               benefit under Section 5(b), payable in five (5) annual installment payments, if
               the Participant died before reaching age 65, or in a lump sum payment, if the
               Participant died on or after his or her 65<SUP>th</SUP> birthday, with the
               payment(s) beginning on the date the spouse&#146;s death benefit would have
               commenced under Section 5(b). If the Participant dies before his or her
               Separation from Service and has no surviving spouse, then no benefit shall be
               payable to anyone under this Plan with respect to the Participant. If the
               Participant dies after his or her Separation from Service but before receiving
               the lump sum payment or all of the 5-year installment payments as elected under
               this Section 7(c), then that lump sum payment or the remaining installment
               payments shall be paid to the Participant&#146;s spouse or, if the Participant
               has no surviving spouse, to the Participant&#146;s estate, at the time those
               payments would have been paid to the Participant. The Participant&#146;s spouse
               who is entitled to receive the payment(s) under this Section 7(c)(3) shall be
               the person, if any, of the opposite sex to whom the participant is legally
               married at the Participant&#146;s death. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<A NAME=A010></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 8 &#151;
Corporation&#146;s Obligations are Unfunded and Unsecured</I></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise required by applicable law, the Corporation&#146;s obligations under this
Plan are not required to be funded or secured in any manner; no assets need be placed in
trust or in escrow or otherwise physically or legally segregated for the benefit of any
Participant; and the eventual payment of the benefits described in this Plan to a
Participant or the Participant&#146;s spouse is not required to be secured to the
Participant or them by the issuance of any negotiable instrument or other evidence of the
Corporation&#146;s indebtedness. Neither a Participant nor the Participant&#146;s spouse
is entitled to any property interest, legal or equitable, in any specific asset of the
Corporation, and, to the extent that any person acquires any right to receive payments
under the provisions of this Plan, that right is intended to be no greater than or to have
any preference or priority over the rights of any other unsecured general creditor of the
Corporation. However, the Corporation reserves the right, in its sole discretion, to
accumulate assets to offset its eventual liabilities under this Plan and physically or
legally to segregate assets for the benefit of any Participant or Participant&#146;s
spouse (whether by escrow, by trust, by the purchase of an annuity contract or by any
other method of funding selected by the Corporation) without liability for any adverse tax
consequences resulting to that Participant or that Participant&#146;s spouse from the
Corporation&#146;s action, except as otherwise provided in this Section with respect to a
Protected Participant and his or her spouse. Any such segregation of assets may be made
with respect to the Corporation&#146;s obligations under this Plan for benefits
attributable to an individual Participant, </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>14</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
a selected group of Participants or all
Participants, as the Corporation may determine from time to time, in its absolute
discretion. Notwithstanding anything to the contrary, in the case of a Protected
Participant (or his or her spouse), if the Corporation or any of its affiliates or
subsidiaries takes any action (without the written consent of the Protected Participant
or, if the Protected Participant is deceased, his or her spouse) that causes the Protected
Participant or the Protected Participant&#146;s spouse to incur income or other taxes with
respect to any benefit under this Plan before the date that benefit is payable to the
Protected Participant (or his or her spouse), the Corporation shall, within 60 days after
a demand therefor is made by the Protected Participant or his or her spouse, reimburse the
Protected Participant (or his or her spouse) for the full amount of those income or other
taxes as well as for the full amount of the income or other taxes the Protected
Participant (or his or her spouse) will incur with respect to such reimbursement or any
subsequent reimbursement hereunder. Benefits under this Plan shall be payable by the
Corporation from the Corporation&#146;s general assets and no other company shall have any
responsibility or liability under this Plan. The Corporation&#146;s liabilities under this
Plan shall, however, be discharged to the extent of any payment received by the
Participant (or the Participant&#146;s surviving spouse) from any other company made for
that purpose and on the Corporation&#146;s behalf or for its benefit. </FONT></P>

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<A NAME=A011></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 9 &#151;
Alienation or Encumbrance</B></I> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
payments, benefits or rights under this Plan shall be subject in any manner to
anticipation, sale, transfer, assignment, mortgage, pledge, encumbrance, charge or
alienation by a Participant, the Participant&#146;s spouse or any other person who could
or might possibly receive benefit payments that were due to the Participant or the
Participant&#146;s spouse, but were not paid. If the Corporation determines that any
person entitled to payments under this Plan has become insolvent, bankrupt, or has
attempted to anticipate, sell, transfer, assign, mortgage, pledge, encumber, charge or
otherwise in any manner alienate any amount payable to that person under this Plan or that
there is any danger of any levy, attachment, or other court process or encumbrance on the
part of any creditor of that person, against any benefit or other amounts payable to that
person, the Corporation may, in its sole discretion and to the extent permitted by law, at
any time, withhold any or all such payments or benefits and apply the same for the benefit
of that person, in such manner and in such proportion as the Corporation may deem proper. </FONT></P>

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<A NAME=A012></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 10 &#151; Other
Benefits</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
provisions of this Plan relate only to the specific benefits described in this Plan and
are not intended to affect any other benefits to which a Participant may be entitled as a
retiree or former employee of Black &amp; Decker. Except as provided below in this Section
10, nothing contained in this Plan shall in any manner modify, impair or affect the
existing rights or interests of a Participant under any other benefit plan provided by
Black &amp; Decker, and the rights and interests of a Participant to any benefits or as a
participant or beneficiary in or under any or all such plans shall continue in full force
and effect unimpaired, subject nonetheless to the eligibility requirements and other terms
of each such plan. This Section shall not be interpreted as modifying in any way the
effect that the Participant&#146;s termination of employment and retirement has upon the
Participant&#146;s rights under such other plans. The benefits provided under this Plan
are not to be applied as an offset against any other retirement or deferred compensation
benefits  </FONT></P>



<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>15</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
or payments that are otherwise to be provided by Black &amp; Decker to the
Participant or the Participant&#146;s beneficiaries; and those benefits or payments are to
be calculated first, ignoring this Plan&#146;s existence. In no event shall any benefits
payable under this Plan be treated as salary or other compensation to a Participant for
the purpose of computing benefits to which the Participant may be entitled under any other
benefit plan of Black &amp; Decker. </FONT></P>

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<A NAME=A013></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 11 &#151; No
Guarantee of Employment</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Plan shall not be construed as conferring any legal rights upon any Participant for
continuation of employment, nor shall it interfere with the rights of Black &amp; Decker
to discharge a Participant and to treat the Participant without regard to the effect which
such treatment might have upon the Participant under this Plan. </FONT></P>

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<A NAME=A014></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 12 &#151;
Cooperation of Parties</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Participant (and surviving spouse) shall perform any and all reasonable acts and execute
any and all reasonable documents and papers that are necessary or desirable for carrying
out this Plan or any of its provisions. </FONT></P>

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<A NAME=A015></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 13 &#151; Benefit
Claims</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Claims Procedure</I></B><I></I>. Any claim by a Participant, a
          Participant&#146;s spouse or beneficiary that benefits under this Plan have not
          been paid in accordance with the terms and conditions of this Plan shall be made
          in writing and delivered to the Committee at the Corporation&#146;s principal
          office in the State of Maryland. The Committee shall notify the claimant if any
          additional information is needed to process the claim. All claims shall be
          approved or denied by the Committee within 90 days of receipt of the claim by
          the Committee. If the claim is denied, the Committee shall furnish the claimant
          with a written notice containing: </FONT></P>


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          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          an explanation of the reason for the denial; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>





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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          a specific reference to the applicable provisions of this Plan; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          a description of any additional material or information necessary for the
          claimant to pursue the claim; </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(4) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          an explanation of the Plan&#146;s claim review procedure described in this
          Section 13; and </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5) </FONT></TD>
          <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
          <TD WIDTH=88%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          a statement of the claimant&#146;s right to bring a civil action under ERISA
          Section 502(a) following denial of his or her claim. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within
90 days of receipt of the notice described above, the claimant shall, if further review is
desired, file a written request for reconsideration with the Committee. A request for
reconsideration must include an explanation of the grounds for the request<B><I>
</I></B><I></I>and the facts supporting the claim. So long as the claimant&#146;s request
for review is pending, including such 90- </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>16</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
day period, the claimant or the claimant&#146;s
duly authorized representative may review pertinent documents and may submit issues and
comments in writing to the Committee. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
final decision shall be made by the Committee within 60 days of the filing of the request
for reconsideration; provided, however, that the Committee, in its discretion, may extend
this period up to an additional 60 days. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
decision by the Committee shall be conveyed to the claimant in writing and shall include
specific reasons for the decision, with specific references to the applicable provisions
of this Plan on which the decision is based. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Arbitration</I></B><I></I>. Any dispute or controversy arising in
          connection with a benefit claim under this Plan, after the claims procedure in
          Section 13(a) has been exhausted, shall be settled exclusively and finally by
          arbitration to be conducted in Towson, Maryland before a neutral arbitrator in
          accordance only with the commercial arbitration rules then in effect of the
          American Arbitration Association. The scope of review of the arbitration
          conducted hereunder shall be limited to whether Black &amp; Decker, the Board or
          the Committee was arbitrary and capricious in the exercise of its or their
          discretion pursuant to the terms of this Plan. The arbitrator appointed
          hereunder shall have no authority or power to grant any remedy or relief not
          otherwise contained in this Plan and may grant relief contained in this Plan
          only if the arbitrator determines that the interpretation or administration of
          this Plan was in fact arbitrary and capricious. The arbitrator appointed
          hereunder shall have no authority to add to, detract from, or modify any term or
          condition of this Plan. The arbitrator shall have no authority to grant any
          relief or remedy other than as called for by the terms of this Plan even if such
          relief or remedy is otherwise available at law or in equity but for the terms
          and conditions of this Plan. Judgment may be entered on the arbitrator&#146;s
          award in a court of competent jurisdiction in the venue of the arbitration. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Attorneys&#146; Fees</I></B><I></I>. The Corporation shall pay to a
          Protected Participant or a Protected Participant&#146;s surviving spouse all
          legal fees and expenses incurred by the Protected Participant or the Protected
          Participant&#146;s surviving spouse in making a claim for benefits or otherwise
          in seeking to obtain or enforce any right or benefit provided by this Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A016></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 14 &#151;
Incapacity</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
a Participant or the Participant&#146;s spouse has become legally incompetent, then the
legal guardian, or other legal representative of such Participant&#146;s or spouse&#146;s
estate shall be entitled to act for and represent such incompetent Participant or spouse
in all matters and to the same extent as the Participant or spouse could have done but for
such incompetency, including but not limited to the receipt of Plan benefits. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A017></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 15 &#151;
Administration</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Committee&#146;s Responsibilities</I></B><I></I>. This Plan shall be
          administered by the Committee, which shall be responsible for all matters
          affecting the administration of this Plan and shall have the following duties
          and responsibilities in connection with the administration of this Plan: </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>17</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To prepare and enforce such rules, regulations and procedures as shall be proper
               for the efficient administration of this Plan, such rules, regulations and
               procedures to apply uniformly to all Participants; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To determine all questions arising in the administration, interpretation and
               application of this Plan, including questions of the status and rights of
               Participants and any other persons hereunder; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To decide any dispute arising hereunder; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To correct defects, supply omissions, and reconcile inconsistencies to the
               extent necessary to effectuate this Plan; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To compute the amount of benefits that shall be payable to any Participant or
               spouse in accordance with the provisions of this Plan and to determine the
               person or persons to whom such benefits shall be paid; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To select the currency conversion or exchange rates to be applied in determining
               a Participant&#146;s or spouse&#146;s benefits under this Plan, where foreign
               currencies are involved; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To authorize all payments that shall be made pursuant to the provisions of this
               Plan; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To make recommendations to the Corporation&#146;s Board of Directors with
               respect to proposed amendments to this Plan; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To file all reports with government agencies, employees, and other parties as
               may be required by law, whether such reports are initially the obligation of the
               Corporation or this Plan; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               To have all such other powers as may be necessary to discharge its duties
               hereunder. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Plan Interpretation</I></B><I></I>. The Committee shall have the authority
          to interpret this Plan in its sole and absolute discretion. The Committee&#146;s
          interpretation of this Plan and actions in respect of this Plan shall be binding
          and conclusive on all persons for all purposes, subject only to review by an
          arbitrator in accordance with the provisions and standards set forth in Section
          13(b). It is intended that this Plan comply with Code Section 409A and any
          regulations or guidance issued thereunder and shall be interpreted accordingly.
          Notwithstanding the amendment provisions of Section 16, the Plan may be amended
          by the Board at any time, retroactively if required, if found necessary, in the
          opinion of the Board, to conform the Plan to the provisions and requirements of
          Code Section 409A. No such amendment shall be considered prejudicial to any
          interest of a Participant or Beneficiary hereunder. Any provision of the Plan
          not in conformance with Code Section 409A shall be void as of January 1, 2005. </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>18</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>




<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Committee&#146;s Liability and Indemnification</I></B><I></I>. Neither the
          Committee nor any person acting on its behalf shall be liable to any person for
          any action taken or omitted in connection with the interpretation and
          administration of this Plan unless attributable to gross negligence or willful
          misconduct. In addition to such other rights of indemnification they may have as
          directors, officers or employees of the Corporation, each member of the
          Committee shall be indemnified by the Corporation against the reasonable
          expenses, including attorneys&#146; fees, actually and necessarily incurred in
          connection with the defense of any action, suit or proceeding, or in connection
          with any appeal therein, to which such member may be a party by reason of any
          action taken or omitted under or in connection with this Plan, and against all
          amounts paid in settlement thereof, provided such settlement is approved by
          independent legal counsel selected by the Corporation, or paid by such member in
          satisfaction of a judgment in any such action, suit or proceeding, except in
          relation to matters as to which it shall be adjudged in such action, suit or
          proceeding that such member is liable for gross negligence or willful misconduct
          in such member&#146;s duties; provided that within 60 days after the institution
          of such action, suit or proceeding the member shall in writing offer the
          Corporation the opportunity, at its own expense, to handle and defend the same. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <B><I>Self-Dealing</I></B><I></I>. If a Participant is also a member of the
          Committee, the Participant may not vote or act upon matters relating
          specifically to such member&#146;s participation in this Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A018></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 16 &#151;
Amendments and Termination</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
Participant who was employed by Black &amp; Decker at any time during the calendar year
2005 and whose benefits under this Plan were then vested must consent in writing by no
later than December 31, 2006 to the adoption of this amended and restated Plan effective
as of January 1, 2005 in order for the terms of this amended and restated Plan to be
effective with respect to that Participant&#146;s rights and benefits hereunder. In the
case of any such Participant who fails to consent to the adoption of this amended and
restated Plan, the terms of the Prior Plan as in effect on December 31, 2004 shall
continue to apply to that Participant&#146;s rights and benefits under this Plan. The
Board of Directors of the Corporation reserves the right at any time and from time to time
to the extent permissible under law, to amend or terminate this Plan, prospectively or
retroactively, in whole or in part; provided, however, that no such amendment or
termination shall (1) have the effect of accelerating or permitting the acceleration of
any payment under this Plan, except to the extent that such acceleration would be
permitted under Code Section 409A, or (2) without the Participant&#146;s written
agreement, reduce or impair (a) the benefits or rights of any Participant (or spouse)
whose Benefit Commencement Date occurred before the date the amendment is adopted or this
Plan is terminated, (b) the vested benefits and rights of any Participant who is then
employed by Black &amp; Decker or (c) the right of any Protected Participant and/or his or
her surviving spouse to receive benefits under this Plan determined as if that Plan
termination or amendment had not occurred. Any amendment or termination shall be adopted
by resolution of the Corporation&#146;s Board of Directors. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>19</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A019></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 17 &#151;
Severability</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any provision of this Plan shall be held void or unenforceable, the remaining provisions
of this Plan shall remain in full force and effect; provided, however, that in
interpreting this Plan, such void or unenforceable provision shall be replaced with an
effective and legally permissible provision, the effect of which shall be identical to, or
as close as reasonably possible to, the effect of the original provision. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A020></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>SECTION 18 &#151;
Construction</B></I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
use of the singular shall include the plural, and vice versa, as may be appropriate.
Titles, captions or paragraph headings contained in this Plan are for purposes of
convenience and reference only, and shall not operate to define or modify the text to
which they relate. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A021></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 19 &#151; Choice
of Law</I></B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Plan, and the respective rights and duties of the Corporation and all persons thereunder,
shall in all respect be governed by and construed under the laws of the State of Maryland,
except to the extent, if any, that those laws may have been pre-empted by federal law.
This Plan is intended to be a &#147;pension plan&#148; within the meaning of Section
3(2)(A) of the Employee Retirement Income Security Act of 1974, as amended (ERISA), which
is exempt from Parts<B><I> </I></B><I></I>2, 3 and 4 of ERISA by virtue of Sections
201(2), 301(a)(3) and 401(a)(1) thereof, respectively, and is not designed to<B><I>
</I></B><I></I>meet the requirements of Section 401(a) of the Code, as amended. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->
<A NAME=A022></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>SECTION 20 &#151; Parties
to be Bound</I></B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
provisions of this Plan shall be binding upon, and shall inure to the benefit of the
Corporation, its successors and assigns, and each Participant and the Participant&#146;s
spouse. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Flush Level 5" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=25%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=75%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Originally
adopted January 30, 1984 <BR>Amendment and Restatement adopted February 18, 1993<BR> Amendment and
Restatement adopted July 20, 1995<BR> Amendment and Restatement adopted February 14, 1996<BR>
Amendment and Restatement adopted October 15, 1998 <BR>Amendment and Restatement adopted
February 11, 1999<BR> Amendment and Restatement adopted April 27, 2004<BR> Amendment and
Restatement adopted October 14, 2005<BR>Amendment and Restatement adopted February 9, 2006 </FONT></TD>
</TR>
</TABLE>
<BR>





<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>20</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<A NAME=A023></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SCHEDULE I &#151;
EXAMPLES OF BENEFIT AMOUNTS*<BR>STATED AS A PERCENTAGE
OF FINAL AVERAGE PAY </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A026></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>PARTICIPANTS (OTHER
THAN PROTECTED PARTICIPANTS)</I></B></FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=12><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE AT BENEFIT COMMENCEMENT DATE**</FONT></TH>
     </TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2> YEARS OF CREDITED SERVICE</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 55 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 56 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2> AGE 57</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 58 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 59</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 60 OR MORE</FONT></TH></TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="35%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Less than 5</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>22</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>23</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>24</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>25</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>24</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>25.2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>26.4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>27.6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28.8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>30</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>28</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>29.4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>30.8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>32.2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33.6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>32</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33.6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>35.2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>36.8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>38.4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>36</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>37.8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>39.6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>41.4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>43.2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>45</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>48</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>48</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>48</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>48</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>40</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>42</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>44</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>46</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>48</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15 or more</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A027></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>PROTECTED PARTICIPANTS</I></B></FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" BORDER="0">
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH COLSPAN=12><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE AT BENEFIT COMMENCEMENT DATE**</FONT></TH>
     </TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2> YEARS OF CREDITED SERVICE</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 55 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 56 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2> AGE 57</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 58 </FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 59</FONT></TH>
     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGE 60 OR MORE</FONT></TH></TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="35%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD WIDTH="5%" ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15 or more</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>50</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>52</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>54</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>56</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>58</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD>
     <TD ALIGN="RIGHT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>60</FONT></TD>
        <TD ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>%</FONT></TD></TR>
<TR>
     <TD COLSPAN=14><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>*Calculated before application of benefit offsets under Section 4, but after application of the early retirement
reduction (for all Participants) and the reduction for less than 10 years of Credited Service (for Participants
other than Protected Participants), in Sections 3(b) and 3(c), respectively. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>**The examples assume that the
Participant&#146;s Normal Retirement Date is age 60. </FONT></P>





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<FILENAME>form10k12312005m.htm
<DESCRIPTION>EXHIBIT 10(R)
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10 (r)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER<BR>EXECUTIVE SALARY
CONTINUANCE PLAN </FONT></H1>



<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
purpose of The Black &amp; Decker Executive Salary Continuance Plan is to assist covered
executives who are separated from employment by the Black &amp; Decker Companies to
cushion the financial effects of the transition period following separation. </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION I. <U>DEFINITIONS.</U>  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following terms shall have the meanings set forth below: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Black &amp; Decker</U>&#148; means The Black &amp; Decker Corporation,
          a Maryland corporation, and its successors. &#147;<U>Black &amp; Decker
          Companies</U>&#148; means Black &amp; Decker and all of its subsidiaries and
          affiliates. &#147;<U>Black &amp; Decker Company</U>&#148; means Black &amp;
          Decker or any of its subsidiaries and affiliates. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Cause</U>&#148; means: (a) an Employee&#146;s willful and repeated
          failure to substantially perform his or her duties after written notice to the
          Employee specifying such failure, or (b) fraud, misappropriation or intentional
          material damage to the property or business of a Black &amp; Decker Company, or
          (c) commission of a felony. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Continuance Period</U>&#148; means the period determined by the Chief
          Executive Officer and stated in the participation agreement. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Effective Date</U>&#148; means May 1, 1995. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Employee</U>&#148; means an employee of a Black &amp; Decker Company
          whose participation in the Plan has been authorized by the Chief Executive
          Officer of Black &amp; Decker and who has executed a participation agreement
          containing such terms, conditions, and limitations as may be prescribed by the
          Chief Executive Officer of Black &amp; Decker from time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>ERISA&#148; </U>means the Employee Retirement Security Act of 1974, as
          it may be amended from time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Manager of the Plan</U>&#148; means the Senior Vice President-Human
          Resources and Corporate Initiatives of Black &amp; Decker. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Plan</U>&#148; means The Black &amp; Decker Executive Salary
          Continuance Plan, as set forth herein, as it may be amended from time to time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Plan Administrator</U>&#148; means The Black &amp; Decker Corporation
          Pension Management Committee. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Salary Continuance</U>&#148; means payments made to an Employee
          pursuant to Section 2.1 below. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Severance</U>&#148; means the termination after the Effective Date of an
Employee&#146;s employment with the Black &amp; Decker Companies by a Black &amp; Decker
Company for any reason other than for Cause. An Employee shall not be considered to have
incurred a Severance if his employment is discontinued by reason of: (a) termination by the Employee</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
for any reason, including but not limited to any change in job or job duties,
compensation, benefits (including participation in the Plan) or workplace for any reason,
(b) the Employee&#146;s death, (c) a physical or mental condition that causes the Employee
to be unable substantially to perform his duties, including without limitation, any
condition that entitles the Employee to benefits under any sick pay or disability income
policy or program of a Black &amp; Decker Company, (d) the Employee&#146;s mandatory
retirement as permitted by applicable law, or (e) termination by the Employee before the
Severance Date scheduled by the Black &amp; Decker Company that employs the Employee. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;<U>Severance Date</U>&#148; means the effective date of an Employee&#146;s
          Severance from employment with all Black &amp; Decker Companies. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 2. <U>BENEFITS.</U> </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Each Employee who incurs a Severance shall be entitled to continue to receive
          his monthly salary during the Continuance Period, or until he obtains another
          position (including a position with a Black &amp; Decker Company), or until his
          death, whichever comes first; provided, however, that monthly salary payments
          shall be accumulated and paid to the Employee in a single-sum payment (with
          interest at an annualized rate of 4.5%) on the date that is six months and one
          day following the Employee&#146;s &#147;separation from service&#148; as defined
          at Section 409A of the Internal Revenue Code of 1986, as amended (the
          &#147;Code&#148;), and regulations issued thereunder. If the Employee obtains
          another position during the Continuance Period, the amount of monthly salary
          paid to the Employee shall be reduced by the amount of gross compensation paid
          or payable to the Employee or credited to his account or for his benefit in
          connection with the other position. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          No Employee shall be eligible to receive Salary Continuance or any other
          benefits under the Plan unless he first executes a valid and legally binding
          release in writing, in a form and manner prescribed by the Manager of the Plan,
          releasing the Black &amp; Decker Companies and their employees, officers and
          directors from claims and liabilities of any kind relating to the
          Employee&#146;s employment. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If a Black &amp; Decker Company is or should become obligated by law or by
          contract to pay an Employee severance pay, vacation pay, salary continuance,
          notice pay, a termination indemnity, or the like, or if a Black &amp; Decker
          Company is or should become obligated by law or by contract to provide advance
          notice of separation (&#147;Notice&#148;) to an Employee, then any Salary
          Continuance otherwise payable under the Plan to the Employee shall be reduced by
          the amount of any such severance pay, salary continuance, notice pay,
          termination indemnity, vacation pay, or the like, and by the amount of any
          compensation received with respect to any Notice period (including any Notice
          period that may be required under the Worker Adjustment and Retraining
          Notification Act) during which the Employee is not required to work. If an
          Employee applies for and receives unemployment compensation payments for any
          period of time for which Salary Continuance payments are made, any Salary
          Continuance payments remaining to be made shall be reduced by the amount of the
          unemployment compensation payments. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Each Employee who incurs a Severance shall also be entitled to continue to
          receive the employee benefits described below during the Continuance Period, or
          until he obtains another position (including a position with a Black &amp;
          Decker Company), or until his death, whichever comes first; provided the
          Employee continues to pay the required employee contribution for the coverage.
          Provided the Employee was eligible for and received these </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>employee benefits
          before the Severance Date, and provided that the Black &amp; Decker Company
          which employed the Employee continues to provide such benefits to similarly
          situated employees, and subject to such amendments and changes in such benefit
          plans, programs, practices and policies as may be made from time to time, the
          benefits that will be continued are: medical, dental, basic life insurance,
          executive life insurance, tax preparation expense reimbursement, automobile
          allowance, executive physical examination and country club memberships. If the
          Employee obtains another position prior to the first anniversary of the
          Severance Date, and if the position does not offer each of these benefits, then
          the benefits that are not offered by the other position will be continued during
          the Continuance Period, or until the benefits are offered by the other position,
          or until the Employee&#146;s death, whichever occurs first, strictly on a
          benefit-by-benefit basis. A benefit will not be continued after the Employee
          obtains another position if that benefit is available in the other position,
          even if the benefit offered by the other position is inferior to the benefit
          offered before the Severance Date, or requires larger employee contributions for
          the coverage. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          All other benefits, including vacation pay and short term and long term
          disability, shall be discontinued on the Severance Date. The Employee&#146;s
          employment shall be deemed to have terminated on his or her Severance Date for
          purposes of any pension, profit-sharing, deferred compensation, stock option,
          stock bonus or stock purchase plan, whether tax-favored or otherwise, that is
          sponsored or administered by a Black &amp; Decker Company and in which the
          Employee participated prior to the Severance Date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 3. <U>CLAIMS, OPERATION AND
INTERPRETATION.</U> </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan shall be interpreted, administered, and operated by the Manager of the
          Plan and the Plan Administrator, each of whom shall have complete authority, in
          his or their sole discretion, to interpret the Plan, to prescribe, amend,
          interpret and rescind rules and regulations relating to the Plan, and to make
          all of the determinations necessary or advisable for the administration of the
          Plan. It is intended that the Plan comply with Section 409A of the Code and the
          regulations and guidance issued thereunder, and it shall be interpreted
          accordingly. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          All questions of any character whatsoever arising in connection with the
          interpretation of the Plan or its administration or operation shall be submitted
          to and settled and determined by the Manager of the Plan or the Plan
          Administrator in an equitable and fair manner in accordance with the procedure
          for claims and appeals described in Section 3.4. Subject to the provisions of
          Section 7.4, any such settlement and determination shall be final and
          conclusive, and shall bind and may be relied upon by the Black &amp; Decker
          Companies, each of the Employees, and all other parties in interest. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan Administrator and the Manager of the Plan may delegate any of their
          duties hereunder to such person or persons as they may designate from time to
          time. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          An Employee shall file a written claim with the Manager of the Plan in order to
          receive Salary Continuance or any other benefits under the Plan. The Manager of
          the Plan shall, within 60 days after receipt of the written claim, send a
          written notification to the Employee as to its disposition. In the event the
          claim is wholly or partially denied, the written notification shall (a) state
          the specific reason or reasons for the denial, (b) make specific reference to
          pertinent Plan provisions on which the denial is based, (c) provide a
          description of any additional material or information necessary for the Employee
          to perfect the claim and an explanation of why such material or information is
          necessary, and (d) set forth the </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
procedure by which the Employee may appeal the
          denial of his claim. In the event an Employee wishes to appeal the denial of his
          claim, he may request a review of the denial by making application in writing to
          the Plan Administrator within 60 days after receipt of the denial. The Employee
          (or his duly authorized legal representative) may, upon written request to the
          Plan Administrator, review any documents pertinent to his claim, and submit in
          writing issues and comments in support of his position. Within 60 days after
          receipt of a written appeal (unless the Plan Administrator determines that
          special circumstances, such as the need to hold a hearing, require an extension
          of time, but in no event more than 120 days after such receipt) the Plan
          Administrator shall notify the Employee of the final decision. The final
          decision shall be in writing and shall include specific reasons for the
          decision, written in a manner calculated to be understood by the claimant, and
          specific references to the pertinent Plan provisions on which the decision is
          based. In the event the Employee wishes to appeal from the Plan
          Administrator&#146;s decision, the Employee may submit the claim to final and
          binding arbitration, in accordance with Section 7.4, by giving written notice to
          the Plan Administrator within 60 days after receipt of the Plan
          Administrator&#146;s decision. No arbitration for benefits under the Plan may be
          commenced unless and until the Employee has submitted a written claim for
          benefits, has been notified that the claim has been denied, has filed a written
          request for review of the denied claim, and has been notified in writing that
          the denial of the claim has been affirmed, all in accordance with the claims
          procedure described above. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 4. <U>PLAN MODIFICATION OR
TERMINATION.</U> </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan may be modified or amended at any time by the Plan Administrator, with
          or without notice. Without limiting the foregoing, the Plan may be modified or
          amended to increase, decrease or eliminate Salary Continuance and benefits
          payable to any Employee who incurs a Severance after such modification or
          amendment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          It is the intention of Black &amp; Decker to continue the Plan and to pay Salary
          Continuance to all Employees who have incurred a Severance. However, Black &amp;
          Decker, by action of the Board of Directors, may for any reason terminate the
          Plan, or the Chief Executive Officer of Black &amp; Decker may withhold its
          application as to some or all Employees, at any time or from time to time, in
          each case with or without notice. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Any modification, amendment, termination, withholding, extension or other action
          shall only apply to Employees who incur a Severance after such action. No such
          action shall reduce or eliminate the Salary Continuance of any Employee whose
          Severance Date occurs on or before such action is taken. Notwithstanding the
          foregoing, the Plan may be amended at any time, including retroactively, to
          conform the Plan to the provisions of Section 409A of the Code and the
          regulations and guidance thereunder. No such amendment shall be considered
          prejudicial to any interest of any Employee hereunder. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 5. <U>GOVERNMENT LAWS AND
REGULATIONS.</U> </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan, as a &#147;severance pay arrangement&#148; within the meaning of
          Section 3(2)(B)(i) of ERISA, is intended to be excepted from the definitions of
          &#147;employee pension benefit plan&#148; and &#147;pension plan&#148; in
          Section 3(2) of ERISA, and is intended to meet the descriptive requirements of a
          plan constituting a &#147;severance pay plan&#148; within the meaning of
          regulations published by the Secretary of Labor at Title 29, Code of Federal
          Regulations, Section 2510.3-2(b), and shall be interpreted accordingly. </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan and the rights of Employees to Salary Continuance and benefits under
          the Plan shall be subject to all applicable governmental laws and regulations.
          Notwithstanding any other provision of the Plan to the contrary, the Manager of
          the Plan and the Plan Administrator may in his or their discretion make such
          changes in the Plan as may be required to conform the Plan to all applicable
          governmental laws and regulations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 6. <U>EMPLOYEE CONDUCT.</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Notwithstanding anything to the contrary, all of an Employee&#146;s rights to
          Salary Continuance and to benefits under the Plan will be forfeited if the
          Employee discloses confidential information of a Black &amp; Decker Company or
          if the Employee, without the written consent of the Manager of the Plan, enters
          into competition with a Black &amp; Decker Company. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          For purposes of this Section 6, the Employee shall be deemed to be in
          competition with a Black &amp; Decker Company if the Employee, directly or
          indirectly, solicits as a customer any company that is or was a customer of a
          Black &amp; Decker Company during the Employee&#146;s employment, or that is or
          was a potential customer of a Black &amp; Decker Company with which a Black
          &amp; Decker Company has made or will make business contacts during the
          Employee&#146;s employment; provided, however, that solicitation of a company as
          a customer of any business that is not in direct or indirect competition with
          any of the types of business conducted by a Black &amp; Decker Company within
          any of the same territories as the Black &amp; Decker Company shall not be
          prohibited hereby. In addition, an Employee shall be deemed to be in competition
          with a Black &amp; Decker Company if the Employee directly or indirectly becomes
          an owner, officer, director, operator, sole proprietor, partner, joint venturer,
          contractor or consultant, or participates in or is connected with the ownership,
          operation, management or control of any company in direct or indirect
          competition with any of the types of businesses conducted by a Black &amp;
          Decker Company within any of the same territories as a Black &amp; Decker
          Company; provided, however, that the ownership for investment of less than 5%<I>
          </I>of the outstanding stock of any of the classes of stock issued by a
          publicly-held company shall not be prohibited hereby. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          For the purposes of this Section 6, the Employee shall be deemed to have
          disclosed &#147;confidential information&#148; if the Employee fails to preserve
          as confidential and uses, communicates, or discloses to any person, to the
          actual or potential detriment of a Black &amp; Decker Company, orally, in
          writing or by publication, any information, regardless of when, where or how
          acquired, relating to or concerning the affairs of a Black &amp; Decker Company;
          provided, however, that the foregoing obligations shall not apply to information
          that is or becomes public through no fault of the Employee. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Manager of the Plan and the Plan Administrator shall have the absolute right
          to determine in his or their sole discretion (a) whether or not an
          Employee&#146;s employment was terminated for Cause, and (b) whether or not an
          Employee has entered into competition with a Black &amp; Decker Company or has
          disclosed confidential information so as to cause a forfeiture of the
          Employee&#146;s rights and benefits hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECTION 7. <U>GENERAL PROVISIONS.</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Nothing in the Plan shall be deemed to give any Employee the right to be
          retained in the employ of any Black &amp; Decker Company or to interfere with
          the right of any Black &amp; Decker Company to discharge an Employee at any time
          and for any lawful reason, </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>with or without notice or cause. In addition, nothing
          in the Plan shall restrict an Employee&#146;s right to terminate his employment
          at any time. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Except as otherwise provided herein or by law, no right or interest of an
          Employee under the Plan shall be assignable or transferable, in whole or in
          part, either directly or by operation of law or otherwise, including without
          limitation by execution, levy, garnishment, attachment, pledge, or any other
          manner; no attempted assignment or transfer thereof shall be effective; and no
          right or interest of an Employee under the Plan shall be liable for, or subject
          to, any obligation or liability of an Employee. When a payment is due under the
          Plan to an Employee and the Employee is unable to care for his affairs, payment
          may be made directly to his legal guardian or personal representative. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Black &amp; Decker may, at any time and from time to time, without any
          Employee&#146;s consent, assign its interest in the Plan with respect to one or
          more Employees to a Black &amp; Decker Company, which shall assume all of Black
          &amp; Decker&#146;s obligations hereunder with respect to such Employees and,
          upon such assignment, the assignee shall be substituted for Black &amp; Decker
          for all purposes under the Plan with respect to such Employees. Any such
          assignment and assumption shall constitute a novation and the assignee(s) shall
          be substituted automatically for Black &amp; Decker with respect to such
          Employees. Any such assignee shall have the same rights as the assignor to
          further assign the Plan. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Any dispute or controversy arising out of or relating to the Plan (or to payor
          benefits that may be provided under the Plan), as well as any dispute or
          controversy arising out of or relating to the termination of an Employee&#146;s
          employment, including any claims based on federal, state or local laws
          (including employment discrimination or wrongful dismissal laws), shall be
          settled exclusively by final and binding arbitration, conducted in Towson,
          Maryland before a neutral arbitrator with expertise in employment law, including
          ERISA, in accordance with the Voluntary Labor Arbitration Rules of the American
          Arbitration Association. In reaching a decision, the arbitrator shall interpret,
          apply and be bound by the Plan and by applicable law. The arbitrator shall apply
          the same standard of review in disputes relating to the Plan or to Plan benefits
          as a court of competent jurisdiction would apply under ERISA. The arbitrator
          shall have no authority to add to, detract from, or modify the Plan or any law
          in any respect. The arbitrator may grant any remedy or relief that may be
          necessary to make the injured party whole, provided that in no event may the
          arbitrator grant any remedy or relief that a court of competent jurisdiction
          could not grant, nor any relief greater than that sought by the injured party.
          Judgment may be entered on the arbitrator&#146;s award in any court of competent
          jurisdiction. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Plan is unfunded. Except as provided in Section 7.3, the liability for
          Salary Continuance and other benefits under the Plan are solely the
          responsibility of Black &amp; Decker. Salary Continuance shall be payable from
          Black &amp; Decker&#146;s general assets, and no other company shall have any
          responsibility or liability under the Plan. However, Black &amp; Decker&#146;s
          liabilities under the Plan shall be discharged to the extent of any payment or
          benefit received by the Employee from any other company made for that purpose
          and on Black &amp; Decker&#146;s behalf or for its benefit. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          If any provision of the Plan shall be held void or unenforceable, the remainder
          of the Plan shall remain in full force and effect, and the Plan shall be
          construed as if such void or unenforceable provision were omitted; provided that
          in interpreting this Plan the arbitrator shall replace such void or
          unenforceable provision with an effective and legally</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
permissible provision, the
          effect of which shall be identical to, or as close as reasonably possible to,
          the effect of the original provision. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent" FSL="Default" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          As used in this Plan, any reference to the masculine, feminine, or neuter gender
          shall include all genders, the plural shall include the singular, and the
          singular shall include the plural. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ADOPTED
BY THE BOARD OF DIRECTORS OF THE BLACK &amp; DECKER CORPORATION, APRIL 25, 2005, AND
AMENDED EFFECTIVE JANUARY 1, 2005. </FONT></P>

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     <P ALIGN=RIGHT><U>/s/ BARBARA B. LUCAS</U> </P>

<!-- MARKER FORMAT-SHEET="Head Sub 2 Left" FSL="Default" -->
<A NAME=A004></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barbara
B. Lucas, Secretary </FONT></P>



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<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A005></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER <BR>EXECUTIVE SALARY
CONTINUANCE PLAN </FONT></P>


<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<A NAME=A007></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>PARTICIPATION
AGREEMENT</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I
understand that this Agreement supersedes all agreements, plans or policies relating to
the provision of salary continuance or severance pay and benefits (e.g., health, life
insurance, etc.), other than providing severance payor benefits upon or following a change
in control of The Black &amp; Decker Corporation. I agree not to make any claim for salary
continuance or severance payor benefits other than a claim for salary continuance and
benefits under The Black &amp; Decker Executive Salary Continuance Plan (the
&#147;Plan&#148;). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I
understand that by agreeing to participate in the Plan, I am agreeing to submit to final
and binding arbitration all disputes regarding the Plan as well as any disputes arising
out of or relating to any termination of my employment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I
have carefully read and fully understand all the provisions of this Agreement which
together with the Plan set forth the entire agreement between me and the Company. I have
not relied upon any statement or representation, written or oral, not set forth in this
document or in the Plan. By signing this Agreement, I confirm that I have obtained
whatever legal or other advice I felt necessary. </FONT></P>



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<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signed
at ____________________, this _____ day of ___________________, 200__.</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD></TR>
<TR VALIGN="TOP">
     <TD ALIGN="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">_______________________ <BR>Employee
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;</FONT></TD></TR>
</TABLE>





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<TYPE>EX-10
<SEQUENCE>14
<FILENAME>form10k12312005n.htm
<DESCRIPTION>EXHIBIT 10(V)
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(v)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February ___, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          ____________ <BR>c/o The Black &amp; Decker Corporation<BR> 701 East Joppa Road <BR>Towson, Maryland 21286</FONT></P>


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<A NAME=A003></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear _______: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February ___, 2006<BR>Page 2</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in </FONT></P>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February __, 2006<BR>Page 4</FONT></P>



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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating </FONT></P>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February __, 2006<BR>Page 7</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six months
               and one day following your &#147;separation from service&#148; as defined in
               Section 409A of the Code and the regulations promulgated thereunder. The
               Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Gross-Up Payment.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in </FONT></P>





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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February __, 2006<BR>Page 8</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees
</FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February __, 2006<BR>Page 9</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other </FONT></P>




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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February ___, 2006<BR>Page 10</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>
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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>________________<BR>February __, 2006<BR>Page 11</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN="BOTTOM">
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<TR VALIGN="TOP">
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">
&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
</FONT></TD></TR></TABLE>
<BR><BR>

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<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the ____day of ________, 2006<BR><BR><U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR></FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
</TABLE>

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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>15
<FILENAME>form10k12312005o.htm
<DESCRIPTION>EXHIBIT 10(W)
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(w)</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
CORPORATION </FONT></H1>

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<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AMENDED AND RESTATED <BR>EMPLOYMENT AGREEMENT </FONT></H1>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this &#147;Agreement&#148;) is made effective
as of the 9th day of February, 2006, by and between The Black &amp; Decker
Corporation, a Maryland corporation (the &#147;Corporation&#148;), and Nolan D. Archibald
(the &#147;Executive&#148;). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation desires to continue to have the benefits of the Executive&#146;s knowledge and
experience as a full-time employee, and the Executive desires to continue in full-time
employment with the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accordingly,
in consideration of the mutual covenants and agreements contained herein, the parties
agree as follows: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Full-Time Employment of Executive</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1
<U>Duties</U>. The Corporation hereby engages the Executive as Chairman, President and
Chief Executive Officer of the Corporation for the Employment Period (as defined in
Section 3), and the Executive accepts such employment on the terms and conditions set
forth in this Agreement. During the Employment Period, the Executive shall be assigned to
corporate headquarters located in Towson, Maryland. The Executive shall exercise such
authority and perform such duties as are commensurate with the Bylaws of the Corporation
and the normal duties of a Chairman, President and Chief Executive Officer of a publicly
traded corporation and shall perform such other reasonably related managerial duties and
responsibilities for the Corporation as may be assigned to him by the Board of Directors
of the Corporation (the &#147;Board&#148;). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2
<U>Compensation</U>. The Corporation shall pay the Executive an annual salary that is not
less than the greater of (a) his annual base salary on the date of this Agreement or (b)
any subsequently established higher annual base salary. The Executive&#146;s salary shall
be payable in periodic equal installments that are not less frequent than the periodic
installments in which his salary was paid immediately prior to the date of this Agreement.
The Executive&#146;s salary shall be subject to normal periodic review for increases based
on the policies of the Corporation and the Executive&#146;s contributions to the
enterprise. In addition to his annual base salary, the Executive shall be entitled to
participate in any compensation programs available to the Executive immediately prior to
the date of this Agreement, including without limitation the Corporation&#146;s (i)
Executive Annual Incentive Plan (&#147;EAIP&#148;) or other comparable annual incentive
plan, (ii) stock option and restricted stock plans, and (iii) Performance Equity Plan
(&#147;PEP&#148;) or other comparable medium- or long-term compensation plan. The
Executive shall also be entitled to participate in any other compensation program that may
be established by the Corporation and in which other executives of the Corporation are
entitled to participate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3
<U>Benefits and Perquisites</U>. In addition to the compensation provided by Section 1.2,
the Corporation shall provide to the Executive all benefits that were available to the
Executive immediately prior to the date of this Agreement, including without limitation,
the Corporation&#146;s (a) tax-qualified Pension Plan, (b) Supplemental Pension Plan, (c)
Supplemental Executive Retirement Plan, (d) Retirement Savings Plan, (e) Supplemental
Retirement Savings Plan, and (f) all group life, supplemental life, long-term disability,
accident, dental and health insurance programs. The Executive shall also be entitled to
participate in any other employee benefit programs that may be established by the
Corporation and in which other executives of the Corporation are entitled to participate.
The Executive shall also be entitled to all perquisites that were available to the
Executive immediately prior to the date of this Agreement and to any perquisites that may
be established by the Corporation and in which other executives of the Corporation are
entitled to participate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4
<U>Equity Awards</U>. The Executive may notify the Compensation Committee of the Board of
his expected retirement date from the Corporation (the &#147;Expected Retirement
Date&#148;). If the Compensation Committee receives the written notice of the Expected
Retirement Date (the &#147;Retirement Notice&#148;), the Compensation Committee shall,
with respect to all stock options and shares of restricted stock granted to the Executive
following the receipt of the Retirement Notice, establish a vesting schedule such that all
of those stock options and shares of restricted stock shall vest by a date on or before
the Expected Retirement Date. Each Option Agreement or Restricted Share Agreement
evidencing those stock options and shares of restricted stock, respectively, shall contain
this vesting schedule. If the Compensation Committee receives the Retirement Notice at
least two years prior to the Expected Retirement Date, the Corporation shall pay to the
Executive a payment (the &#147;PEP Retirement Payment&#148;) in an amount equal to the
value of 150% of the Performance Shares (as defined in the PEP), if any, that are
forfeited by the Executive pursuant to the PEP as a result of the Executive&#146;s
retirement on the Expected Retirement Date plus accrued interest in accordance with the
following sentence on the date that is 18 months following the Executive&#146;s
&#147;separation from service&#148; as defined in Section 409A of the Internal Revenue
Code (the &#147;Code&#148;). The aggregate amount payable under this Section 1.4 shall
bear interest at an annualized rate of 4.5% from and after the Executive&#146;s
&#147;separation from service&#148; until paid pursuant to this Section 1.4. For purposes
of calculating the PEP Retirement Payment, the value of each Performance Share shall be
the closing price per share of the Corporation&#146;s shares of common stock as reported
on the New York Stock Exchange (the &#147;NYSE&#148;) on or nearest to the Expected
Retirement Date (or, if not listed on the NYSE, on a nationally recognized exchange or
quotation system on which volume in the Corporation&#146;s shares of common stock is the
highest). </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Competition; Confidential Information</U>. The Executive and the Corporation
          recognize that, due to the nature of his relationship to the Corporation, the
          Executive has access to, and may assist in developing, confidential and
          proprietary information relating to the business and operations of the
          Corporation and its affiliates. The Executive acknowledges that this information
          is of central importance to the business of the Corporation and its affiliates
          and that disclosure of it to, or its use by, others could cause substantial loss
          to the Corporation. The Executive and the Corporation also recognize that an
          important part of the Executive&#146;s duties will be to develop goodwill for
          the Corporation through his personal contact with others having business
          relationships with the Corporation and its affiliates, and that there is a
          danger that this </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-2-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>goodwill, a proprietary asset of the Corporation and its
          affiliates, may follow the Executive if and when his relationship with the
          Corporation is terminated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1
<U>Non-Competition</U>. During the Employment Period, the Executive will not, directly or
indirectly, either individually or as owner, partner, agent, employee, consultant or
otherwise, except for the account of and on behalf of the Corporation or its affiliates,
engage in any activity competitive with the business of the Corporation or its affiliates,
nor will he, in competition with the Corporation or its affiliates, solicit or otherwise
attempt to establish any business relationships with any person, firm or corporation that
was, at any time during the Employment Period, a customer or supplier of the Corporation.
Notwithstanding the foregoing, nothing in this Section 2.1 shall be construed to prevent
the Executive from owning, as an investment, not more than 5% of a class of equity
securities issued by any competitor of the Corporation and publicly traded and registered
under Section 12 of the Securities Exchange Act of 1934. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2
<U>Confidential Information</U>. During and at all times after the termination of the
Employment Period, the Executive (a) will not disclose any trade secrets, customer lists,
production processes, business plans, or other proprietary information that is treated as
confidential by the Corporation or its affiliates and is now known to him or which
hereafter may become known to him as a result of his employment or association with the
Corporation (collectively, &#147;Confidential Information&#148;) and (b) will not at any
time, directly or indirectly, disclose any Confidential Information to any person, firm or
corporation, or use any Confidential Information in any way other than in connection with
the business of the Corporation or its affiliates; provided, however, that the foregoing
restrictions shall not apply to any Confidential Information that, through no fault of the
Executive, has entered the public domain. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3
<U>Corporation&#146;s Remedies for Breach</U>. The Executive acknowledges that damages in
the event of his breach of this Section 2 would be difficult, if not impossible, to
ascertain. The Corporation shall have the right to an injunction or other equitable relief
in any court of competent jurisdiction enjoining any such breach without having to post a
bond. The existence of this right shall not preclude any other rights and remedies at law
or in equity available to the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Employment Period and Termination</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
<U>Duration and Performance</U>. The &#147;Employment Period,&#148; which commenced prior
to the date of this Agreement, shall continue until the Date of Termination (as defined in
Section 3.6). Subject to the performance of the covenants and agreements made by the
Corporation in this Agreement, the Executive will perform his duties during the Employment
Period in good faith and will observe faithfully the covenants and agreements made by him
in this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
<U>Disability</U>. If, as a result of the Executive&#146;s incapacity due to physical or
mental illness, the Executive shall have been absent from the full-time performance of his
duties with the Corporation for six consecutive months and, within 30 days after written
Notice of Termination (as defined in Section 3.5) is given to the Executive, shall not
have returned to the </FONT></P>

<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-3-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>full-time performance of his duties, the Executive&#146;s employment
may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3
<U>Termination by the Corporation for Cause</U>. Termination by the Corporation of the
Executive&#146;s employment for &#147;Cause&#148; shall mean termination upon (a) the
willful and continued failure by the Executive to substantially perform his duties (other
than any such failure resulting from his incapacity due to physical or mental illness or
any such actual or anticipated failure after the issuance by the Executive of a Notice of
Termination for Good Reason) after a written demand for substantial performance is
delivered to the Executive by the Board, which demand specifically identifies the manner
in which the Board believes that the Executive has not substantially performed his duties,
or (b) the willful engaging by the Executive in conduct that is demonstrably and
materially injurious to the Corporation, monetarily or otherwise. For purposes of this
Section 3.3, no act or failure to act on the Executive&#146;s part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by the Executive not in good faith
and without reasonable belief that his action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, the Executive shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to the Executive a
copy of a resolution duly adopted by the affirmative vote of not less than three-quarters
of the entire membership of the Board at a meeting of the Board called and held for that
purpose (after reasonable notice to the Executive and an opportunity for the Executive,
together with his counsel, to be heard before the Board), finding that in the good faith
opinion of the Board the Executive was guilty of the conduct set forth above in clauses
(a) or (b) of the first sentence of this Section 3.3 and specifying the particulars
thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4
<U>Termination by the Executive for Good Reason</U>. The Executive shall be entitled to
terminate his employment for Good Reason. For purposes of this Agreement, &#147;Good
Reason&#148; shall mean, without the Executive&#146;s express written consent, the
Corporation&#146;s failure to perform any covenant contained in this Agreement or the
occurrence of any of the following circumstances unless the circumstances are fully
corrected prior to the Date of Termination specified in the Notice of Termination given in
respect thereof: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to the Executive of any duties inconsistent with his current
               status as Chairman, President, and Chief Executive Officer of the Corporation as
               described in Section 1.1 or a substantial adverse alteration in the nature or
               status of the Executive&#146;s responsibilities from those in effect immediately
               prior to the date of this Agreement; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               upon the occurrence of a Change in Control of the Corporation (as defined in
               Section 5.2), the Executive is not the Chairman, President and Chief Executive
               Officer of (i) the Corporation, if it is the surviving entity in any merger,
               share exchange, acquisition or other business combination with the Corporation,
               (ii) the successor entity to the Corporation in any merger, share exchange,
               consolidation, acquisition or other business combination with the Corporation,
               or (iii) any entity that beneficially owns a majority of the voting stock of the
               Corporation, provided that in all of the foregoing cases such entity is a
               publicly held corporation that (A) on a consolidated basis has a net worth equal
               to or greater than the Corporation immediately before the Change in Control of
               the </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-4-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>



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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Corporation, (B) has a board of directors with three-quarters of the
               directors being &#147;independent directors&#148; as defined in the
               Corporation&#146;s Corporate Governance Policies and Procedures Statement, and
               (C)&nbsp;no person or business organization, or affiliated group of persons or
               business organizations, owns or controls 20% or more of the voting stock of such
               corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in the Executive&#146;s annual base salary as in
               effect on the date of this Agreement or any subsequently established higher
               annual base salary; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which the Executive participated immediately prior to the date of this Agreement
               or any compensation plan established after the date of this Agreement in which
               the Executive shall participate that is material to his total compensation,
               including without limitation the Corporation&#146;s (i) EAIP or other comparable
               annual incentive plan, (ii) stock option and restricted stock plans, and (iii)
               PEP or other comparable medium- or long-term compensation plan; unless an
               equitable arrangement (embodied in an ongoing substitute or alternative plan)
               has been made with respect to the plan and the equitable arrangement provides
               substantially equivalent benefits not materially less favorable to the Executive
               (both in terms of the amount of benefits provided and the level of the
               Executive&#146;s participation relative to other participants), or the failure
               by the Corporation to continue the Executive&#146;s participation therein (or in
               such substitute or alternative plan) on a basis not materially less favorable
               (both in terms of the amount of benefits provided and the level of the
               Executive&#146;s participation relative to other participants) than those the
               Executive enjoyed immediately prior to the date of this Agreement; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to the Executive immediately prior to the date of this Agreement or
               provided to the Executive after the date of this Agreement, including without
               limitation, the Corporation&#146;s (a) tax-qualified Pension Plan, (b)
               Supplemental Pension Plan, (c) Supplemental Executive Retirement Plan, (d)
               Retirement Savings Plan, (e) Supplemental Retirement Savings Plan, and (f) all
               group life, supplemental life, long-term disability, accident, dental and health
               insurance programs, the failure to continue to provide to the Executive any
               material perquisite provided to the Executive immediately prior to the date of
               this Agreement, or the taking of any action by the Corporation that would
               directly or indirectly materially reduce any of these benefits or deprive the
               Executive of any material benefit or perquisite enjoyed by the Executive
               immediately prior to the date of this Agreement; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;8.1; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of the Executive&#146;s employment that is not
               effected pursuant to a Notice of Termination satisfying the requirements of
               Section </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-5-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.5 (and, if applicable, the requirements of Section 3.3), which
               purported termination shall not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Executive&#146;s rights to
terminate his employment pursuant to this Section 3.4 shall not be affected by his
incapacity due to physical or mental illness. The Executive&#146;s continued employment
shall not constitute consent to, or a waiver of rights with respect to, any circumstance
constituting Good Reason hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5
<U>Notice of Termination</U>. Any purported termination of the Executive&#146;s employment
by the Corporation or by the Executive shall be communicated by written Notice of
Termination to the other party in accordance with Section 6. For purposes of this
Agreement, a &#147;Notice of Termination&#148; shall mean a notice that indicates the
specific termination provision in this Agreement relied upon and that sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for termination
of the Executive&#146;s employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if the Executive&#146;s employment is terminated by his
death, the date of the Executive&#146;s death, (b) if the Executive&#146;s employment is
terminated for Disability, 30 days after Notice of Termination is given (provided that he
shall not have returned to the full-time performance of his duties during the 30-day
period), (c) the Expected Retirement Date (if the Executive&#146;s employment is
terminated upon his retirement on the Expected Retirement Date), or (d) if the
Executive&#146;s employment is terminated for any reason other than death or Disability,
the date specified in the Notice of Termination. For purposes of clause (d) in the
immediately preceding sentence, the date specified in the Notice of Termination shall not
be less than 30 days from the date the Notice of Termination is given, except in the case
of a termination pursuant to Section 3.4 such date shall not be less than 15 nor more than
60 days from the date that the Notice of Termination is given. If the party receiving the
Notice of Termination notifies the other party within 15 days of receiving the Notice of
Termination or, if later, prior to the Date of Termination (as determined without regard
to this sentence) that a dispute exists concerning the termination, the Date of
Termination shall be the date on which the dispute is finally determined, either by mutual
written agreement of the parties, by a binding arbitration award, or by a final judgment,
order or decree of a court of competent jurisdiction (which is not appealable or with
respect to which the time for appeal has expired and no appeal has been perfected). The
Date of Termination shall be extended by a notice of dispute only if the notice is given
in good faith and the party giving the notice pursues the resolution of the dispute with
reasonable diligence. Notwithstanding the pendency of the dispute, the Corporation will
continue to pay the Executive his full compensation in effect when the Notice of
Termination giving rise to the dispute was given (including, but not limited to, base
salary) and continue the Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice giving rise to the dispute
was given, until the dispute is finally resolved in accordance with this Section 3.6.
Amounts paid under this Section 3.6 are in addition to all other amounts due under this
Agreement and shall not be offset against or reduce any other amounts due under this
Agreement. </FONT></P>


<P ALIGN=CENTER><FONT FACE="TIMES NEW ROMAN" SIZE=2>-6-</FONT></P>
<HR SIZE=5 COLOR=GRAY NOSHADE>
<DIV STYLE="page-break-after:always"></DIV>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Termination for Cause, without Good Reason, or upon Disability or Death</U>. If the
Executive&#146;s employment shall be terminated by the Executive&#146;s death, by the
Corporation for Cause or Disability, or by the Executive without Good Reason (other than
upon Executive&#146;s retirement on the Expected Retirement Date), the Corporation shall
pay the Executive his full base salary through the Date of Termination at the rate in
effect at the time of his death or Notice of Termination is given, as the case may be,
plus all other amounts to which the Executive is entitled under the terms of any
compensation program or benefit plan of the Corporation at the time the payments are due,
and the Corporation shall have no further obligations to the Executive under this
Agreement. If the Executive&#146;s employment is terminated upon his retirement on the
Expected Retirement Date, the Corporation shall pay the Executive his full base salary
through the Expected Retirement Date plus all other amounts to which the Executive is
entitled under the terms of any compensation program or benefit plan of the Corporation at
the time the payments are due. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Termination without Cause or Disability or for Good Reason</U>. If the Executive&#146;s
employment by the Corporation shall be terminated (A) by the Corporation other than for
Cause or Disability or (B) by the Executive for Good Reason, then the Executive shall be
entitled to the following benefits: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay the Executive his full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which he is entitled under any compensation plan of
               the Corporation at the time such payments are due, except as otherwise provided
               below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to the Executive for periods subsequent
               to the Date of Termination, the Corporation shall pay as severance pay to the
               Executive a lump sum severance payment (the &#147;Severance Payment&#148;) in an
               amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=9%></TD>
               <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of his (x) annual base salary in effect immediately prior to
               the Executive&#146;s termination and (y) EAIP Maximum Payment (as defined
               below); <U>plus</U> </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=9%></TD>
               <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
                his PEP Maximum Payment (as defined below).</FONT></P></TD>

               </TR>
               </TABLE>
               <BR>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>For purposes of this Agreement,
&#147;EAIP Maximum Payment&#148; shall mean the maximum payment that the Executive could
have received under the EAIP for the year in which the Date of Termination occurs,
determined as if the Executive had remained a participant until the end of the year and as
if all performance goals for that year that would entitle the Executive to a maximum
payment were met or exceeded. For purposes of this Agreement, &#147;PEP Maximum
Payment&#148; shall mean an amount equal to the sum of (a) the value of 150% of the
Performance Shares, if any, that are forfeited by the Executive pursuant to the PEP as a
result of the Executive&#146;s termination <U>plus</U> (b) 150% of the product of (A) the
Executive&#146;s annual base salary <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>awarded to the Executive with respect to the
most recent award under the PEP. For purposes of calculating the PEP Maximum Payment, the
value of each Performance Share shall be the closing price per share of the
Corporation&#146;s shares of common stock as reported on the NYSE on or nearest to the
Date of Termination (or, if not listed on the NYSE, on a nationally recognized exchange or
quotation system on which volume in the Corporation&#146;s shares of common stock is
highest). The provisions of this Section 4.2(b) shall not in any way affect the
Executive&#146;s rights under the PEP. </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Executive shall fully vest in all outstanding stock options granted to the
               Executive under the Corporation&#146;s stock option plans, and all shares of
               restricted stock held by the Executive shall become fully vested and no longer
               subject to forfeiture. Each stock option shall continue to be exercisable for
               the original term of that stock option. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to the Executive all legal fees and expenses
               incurred by him as a result of such termination (including all such fees and
               expenses, if any, incurred in contesting or disputing any such termination or in
               seeking to obtain or enforce any right or benefit provided by this Agreement or
               in connection with any tax audit or proceeding to the extent attributable to the
               application of Section 4999 of the Code to any payment or benefit provided
               hereunder). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               If the Severance Payment or any other portion of the Total Payments (as defined
               below) will be subject to the tax imposed by Section 4999 of the Code (the
               &#147;Excise Tax&#148;), the Corporation shall pay to the Executive at the time
               specified in Section 4.3 an additional amount (the &#147;Gross-Up Payment&#148;)
               such that the net amount retained by the Executive, after deduction of any
               Excise Tax on the Severance Payment and such other Total Payments and any
               federal and state and local income tax and Excise Tax upon the Gross-Up Payment,
               shall be equal to the Severance Payment and such other Total Payments. For
               purposes of determining whether any of the payments will be subject to the
               Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
               received or to be received by the Executive in connection with his termination
               of employment (whether payable pursuant to the terms of this Agreement or any
               other plan, arrangement or agreement with the Corporation, its successors, or
               any corporation affiliated (or which, as a result of the completion of a
               transaction causing a Change in Control of the Corporation, will become
               affiliated) with the Corporation within the meaning of Section 1504 of the Code)
               (together with the Severance Payment, the &#147;Total Payments&#148;) shall be
               treated as &#147;parachute payments&#148; within the meaning of Section
               280G(b)(2) of the Code, and all &#147;excess parachute payments&#148; within the
               meaning of Section 280G(b)(1) shall be treated as subject to the Excise Tax,
               unless, in the opinion of tax counsel selected by the Corporation and acceptable
               to the Executive (&#147;Tax Counsel&#148;), the Total Payments (in whole or in
               part) do not constitute parachute payments, or such excess parachute payments
               (in whole or in part) represent reasonable compensation for services actually
               rendered within the meaning of Section 280G(b)(4)(B) of the Code either to the
               extent such reasonable compensation is in excess of the base amount within the
               meaning of Section 280G(b)(3) of the Code, or are otherwise not subject to the
               Excise Tax, (ii) the amount of the Total Payments that shall be treated as
               subject to the Excise</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Tax shall be equal to the lesser of (A) the total amount
               of the Total Payments or (B) the amount of excess parachute payments within the
               meaning of Section 280G(b)(1) (after applying clause (i), above) and (iii) the
               value of any non-cash benefits or any deferred payment or benefit shall be
               determined by Tax Counsel in accordance with the principles of Sections
               280G(d)(3) and (4) of the Code. For purposes of determining the amount of the
               Gross-Up Payment, the Executive shall be deemed to pay federal income taxes at
               the highest marginal rate of federal income taxation in the calendar year in
               which the Gross-Up Payment is to be made and state and local income taxes at the
               highest marginal rate of taxation in the state and locality of the
               Executive&#146;s residence on the Date of Termination, net of the maximum
               reduction in federal income taxes that could be obtained from deduction of such
               state and local taxes. If the Excise Tax is subsequently determined to be less
               than the amount taken into account under this Section 4.2(e) at the time of
               payment of the Gross-Up Payment, the Executive shall repay to the Corporation at
               the time that the amount of such reduction in Excise Tax is finally determined
               the portion of the Gross-Up Payment attributable to such reduction (plus the
               portion of the Gross-Up Payment attributable to the Excise Tax and federal and
               state and local income tax imposed on the Gross-Up Payment being repaid by the
               Executive if such repayment results in a reduction in Excise Tax and/or a
               federal and state and local income tax deduction) plus interest on the amount of
               such repayment at the rate provided in Section 1274(d) of the Code. If the
               Excise Tax is determined to exceed the amount taken into account under this
               Section 4.2(e) at the time of payment of the Gross-Up Payment (including by
               reason of any payment the existence or amount of which cannot be determined at
               the time of the payment of the Gross-Up Payment), the Corporation shall make an
               additional Gross-Up Payment in respect of such excess (plus any interest,
               penalties, and professional fees incurred by the Executive with respect to such
               excess, including all such taxes with respect to such additional amount) at the
               time that the amount of such excess is finally determined. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               For a 36-month period after the Date of Termination, the Corporation shall
               provide the Executive with life, disability, accident and health insurance
               benefits substantially similar to those which he is receiving immediately prior
               to termination. Benefits otherwise receivable by the Executive pursuant to this
               Section 4.2(f) shall be reduced to the extent comparable benefits are actually
               received by the Executive from another employer during the 36-month period
               following the Date of Termination, and any such benefits actually received by
               the Executive shall be reported to the Corporation. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Payment of Severance Benefits</U>. The payments provided for in Sections 4.2(b) and
(e), plus interest accrued in accordance with the following sentence, shall be made on the
date that is 18 months following the Executive&#146;s &#147;separation from service&#148;
as defined in Section 409A of the Code and the regulations promulgated thereunder. The
aggregate amount payable under Section 4.2(b) shall bear interest at an annualized rate of
4.5% from and after the Executive&#146;s &#147;separation from service&#148; until paid
pursuant to this Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Mitigation</U>. The Executive shall not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment or otherwise. The</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Corporation shall not be entitled to set off against the amount of any payment or benefit
provided for in this Agreement any amounts owed to the Corporation by the Executive, any
compensation earned by the Executive as the result of employment by another employer, or
any retirement benefits including, without limitation, any amounts to which the Executive
may be entitled under the Corporation&#146;s tax-qualified Pension Plan, Supplemental
Pension Plan, Supplemental Executive Retirement Plan, Retirement Savings Plan, or
Supplemental Retirement Savings Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Other Benefits</U>. In addition to the amounts payable to the Executive under this
Agreement, the Executive shall be entitled to receive all benefits payable to the
Executive under the Corporation&#146;s tax-qualified Pension Plan, Supplemental Pension
Plan, Supplemental Executive Retirement Plan, Retirement Savings Plan, Supplemental
Retirement Savings Plan, or any other plan or arrangement sponsored by the Corporation or
any of its affiliates relating to retirement or other benefits in accordance with the
terms of such plans or arrangements. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation, the
Executive shall fully vest in all outstanding stock options granted to the Executive under
the Corporation&#146;s stock option plans. Each stock option shall continue to be
exercisable for the original term of that stock option. In accordance with the terms of
the PEP and the Corporation&#146;s Restricted Stock Plan, respectively, the maximum number
of Performance Shares (150% of the target award for each performance period) held by the
Executive shall be deemed to have been earned (and shall be paid in accordance with the
payment provisions of the PEP) and all shares of restricted stock held by the Executive
shall become fully vested and no longer subject to forfeiture upon a Change in Control of
the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Definition of Change in Control</U>. For purposes of this Agreement, a &#147;Change in
Control of the Corporation&#148; shall mean a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
Act&#148;), whether or not the Corporation is in fact required to comply therewith,
provided that, without limitation, such a change in control shall be deemed to have
occurred if (a) any &#147;person&#148; (as that term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation or any of its subsidiaries or a corporation
owned, directly or indirectly, by the stockholders of the Corporation in substantially the
same proportions as their ownership of stock of the Corporation is or becomes the
&#147;beneficial owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing 20% or more of the combined
voting power of the Corporation&#146;s then outstanding securities; (b) during any period
of two consecutive years, individuals who at the beginning of that period constitute the
Board and any new director (other than a director designated by a person who has entered
into an agreement with the Corporation to effect a transaction described in clauses (a) or
(d) of this Section 5.2) whose election by the Board or nomination for election by the
Corporation&#146;s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for any reason
to constitute a majority of the Board; (c) the Corporation enters into an agreement, the
</FONT></P>

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consummation of which would result in the occurrence of a Change in Control of the
Corporation; or (d) the stockholders of the Corporation approve a merger, share exchange
or consolidation of the Corporation with any other corporation or entity, other than a
merger, share exchange or consolidation that would result in the voting securities of the
Corporation outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the surviving
entity) at least 60% of the combined voting power of the voting securities of the
Corporation or the surviving entity outstanding immediately after the merger, share
exchange or consolidation, or the stockholders of the Corporation approve a plan of
complete liquidation of the Corporation or an agreement for the sale or disposition by the
Corporation of all or substantially all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in this Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid, addressed to the
          respective addresses set forth on the first page of this Agreement, provided
          that all notices to the Corporation shall be directed to the attention of the
          Board with a copy to the Secretary of the Corporation, or to such other address
          as either party may have furnished to the other in writing in accordance
          herewith, except that notice of change of address shall be effective only upon
          receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Waivers</U>. The waiver by the Corporation of a breach by the Executive of
          any provision of this Agreement shall not operate or be construed as a waiver of
          any subsequent breach by him. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle the Executive to
compensation from the Corporation in the same amount and on the same terms as the
Executive would be entitled to under this Agreement if the Executive terminated his
employment for Good Reason, except that for purposes of implementing the foregoing, the
date on which the succession becomes effective shall be deemed the Date of Termination. As
used in this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore
defined and any successor to its business or assets as described above that assumes and
agrees to perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by the Executive&#146;s personal or legal representatives, executors, administrators,
heirs, distributees, and legatees. Any amount payable to the Executive under this
Agreement at the time of his death, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to the Executive&#146;s legatee or other
designee or, if there is no such designee, to the Executive&#146;s estate. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Entire Agreement; Amendment</U>. Except as otherwise herein provided, this
          Agreement constitutes the entire understanding of the Executive and the
          Corporation with respect to the subject matter hereof and supersedes any and all
          prior understandings, written or oral. This Agreement may not be changed or
          canceled orally, but only by an instrument in writing signed by the parties. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Governing Law</U>. This Agreement shall be governed by the laws of the State
          of Maryland and the invalidity or unenforceability of any provisions hereof
          shall in no way affect the validity or enforceability of any other provision. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date
first above written. </FONT></P>




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     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ATTEST:<BR><BR><U>/s/ BARBARA B. LUCAS
&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ ANTHONY LUISO&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Anthony Luiso, Chairman,<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation Committee
</FONT></TD></TR>

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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD></TR>


<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">WITNESS:<BR><BR><U> /s/ CHARLES E. FENTON&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR><BR><U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR> Nolan D. Archibald</FONT></TD></TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>16
<FILENAME>form10k12312005p.htm
<DESCRIPTION>EXHIBIT 10(X)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(x)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February 10, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;&nbsp;
          John W. Schiech<BR> c/o The Black &amp; Decker Corporation <BR>701 East Joppa Road <BR>Towson, Maryland 21286 </FONT></P>

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<A NAME=A003></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear John: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be </FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 2</FONT></P>






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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in</FONT></P>


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<A NAME=A010></A>
<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 3</FONT></P>





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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2> Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 4</FONT></P>





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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 5</FONT></P>





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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating</FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 6</FONT></P>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>

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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 7</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six<B>
               </B>months and one day following your &#147;separation from service&#148; as
               defined in Section 409A of the Code and the regulations promulgated thereunder.
               The Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Gross-Up Payment.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in
</FONT></P>

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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 8</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees
</FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 9</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 10</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. John W. Schiech<BR>February 10, 2006<BR>Page 11</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>


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&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
</FONT></TD></TR></TABLE>
<BR><BR>

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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the 10th day of February, 2006<BR><BR><U> /s/ JOHN W. SCHIECH&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>John W. Schiech</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
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<TYPE>EX-10
<SEQUENCE>17
<FILENAME>form10k12312005q.htm
<DESCRIPTION>EXHIBIT 10(Y)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(y)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February 10, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;&nbsp;
          Charles E. Fenton <BR>c/o The Black &amp; Decker Corporation <BR>701 East Joppa Road <BR>Towson, Maryland 21286 </FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Charlie: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 2</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in </FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 3</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 4</FONT></P>



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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 5</FONT></P>




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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 6</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 7</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six months
               and one day following your &#147;separation from service&#148; as defined in
               Section 409A of the Code and the regulations promulgated thereunder. The
               Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Gross-Up Payment.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 8</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 9</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 10</FONT></P>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Charles E. Fenton<BR>February 10, 2006<BR>Page 11</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>

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&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
</FONT></TD></TR></TABLE>
<BR><BR>

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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the 10th day of February, 2006<BR><BR><U> /s/ CHARLES E. FENTON&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>Charles E. Fenton</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
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<SEQUENCE>18
<FILENAME>form10k12312005r.htm
<DESCRIPTION>EXHIBIT 10(Z)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(z)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February 10, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;&nbsp;
          Michael D. Mangan <BR>c/o The Black &amp; Decker Corporation<BR> 701 East Joppa Road<BR> Towson, Maryland 21286</FONT></P>


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<A NAME=A003></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Mike: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 2</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in </FONT></P>




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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 3</FONT></P>





<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 4</FONT></P>



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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 5</FONT></P>



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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating </FONT></P>




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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 6</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 7</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six months
               and one day following your &#147;separation from service&#148; as defined in
               Section 409A of the Code and the regulations promulgated thereunder. The
               Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Gross-Up Payment.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in </FONT></P>





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<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->

<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 8</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees
</FONT></P>



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<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->

<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 9</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other </FONT></P>




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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 10</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>
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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Michael D. Mangan<BR>February 10, 2006<BR>Page 11</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>


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&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
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<BR><BR>

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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the 10th day of February, 2006<BR><BR><U> /s/ MICHAEL D. MANGAN&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>Michael D. Mangan</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
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<TYPE>EX-10
<SEQUENCE>19
<FILENAME>form10k12312005s.htm
<DESCRIPTION>EXHIBIT 10(AA)(2)
<TEXT>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(aa)(2)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February 10, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;&nbsp;
          Paul A. Gustafson <BR>c/o The Black &amp; Decker Corporation <BR>701 East Joppa Road<BR>Towson, Maryland 21286 </FONT></P>



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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Paul: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be</FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 2</FONT></P>






<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in </FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 3</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 4</FONT></P>




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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 5</FONT></P>




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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating </FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 6</FONT></P>





<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 7</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six months
               and one day following your &#147;separation from service&#148; as defined in
               Section 409A of the Code and the regulations promulgated thereunder. The
               Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Gross-Up Payment.</U> </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in </FONT></P>



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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 8</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 9</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 10</FONT></P>


 <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Paul A. Gustafson<BR>February 10, 2006<BR>Page 11</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>

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&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the 10th day of February, 2006<BR><BR><U> /s/ PAUL A. GUSTAFSON&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>Paul A. Gustafson</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
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<FILENAME>form10k12312005t.htm
<DESCRIPTION>EXHIBIT 10(BB)
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 10(bb)</B></FONT></P>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>February 10, 2006 </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;&nbsp;
          Thomas D. Koos <BR>c/o The Black &amp; Decker Corporation <BR>701 East Joppa Road<BR> Towson, Maryland 21286</FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Tom: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Black &amp; Decker Corporation (the &#147;Corporation&#148;) considers it essential to the
best interests of its stockholders to foster the continuous employment of key management
personnel. In this connection, the Board of Directors of the Corporation (the
&#147;Board&#148;) recognizes that, as is the case with many publicly held corporations,
the possibility of a change in control of the Corporation may exist and that such
possibility, and the uncertainty and questions that it may raise among management, may
result in the departure or distraction of management personnel to the detriment of the
Corporation and its stockholders. The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of members of
the Corporation&#146;s management, including you, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Corporation, although no such change is now
contemplated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to induce you to remain in the employ of the Corporation, the Corporation agrees
that you shall receive the severance benefits set forth in this letter agreement (this
&#147;Agreement&#148;) in the event of a &#147;Change in Control of the Corporation&#148;
(as defined in Section 2) under the circumstances described below. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Term of Agreement</U>. This Agreement shall commence on the date hereof and
          shall continue in effect through December&nbsp;31, 2011; provided, however, that
          if a Change in Control of the Corporation shall have occurred prior to
          December&nbsp;31, 2011, this Agreement shall continue in effect for a period of
          36 months beyond the month in which the Change in Control of the Corporation
          occurred, at which time this Agreement shall terminate. Notwithstanding the
          foregoing, and provided no Change in Control of the Corporation shall have
          occurred, this Agreement shall automatically terminate upon the earlier to occur
          of (a) your termination of employment with the Corporation, or (b) the
          Corporation&#146;s giving you notice of termination of this Agreement,
          regardless of the effective date of such termination. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Change in Control</U>. No benefits shall be payable under this Agreement
          unless there shall have been a Change in Control of the Corporation. For
          purposes of this Agreement, a &#147;Change in Control of the Corporation&#148;
          shall mean a change in control of a nature that would be </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 2</FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>required to be reported
          in response to Item 6(e) of Schedule&nbsp;14A of Regulation 14A promulgated
          under the Securities Exchange Act of 1934, as amended (the &#147;Exchange
          Act&#148;), whether or not the Corporation is in fact required to comply
          therewith, provided that, without limitation, such a change in control shall be
          deemed to have occurred if (A) any &#147;person&#148; (as that term is used in
          Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other
          fiduciary holding securities under an employee benefit plan of the Corporation
          or any of its subsidiaries or a corporation owned, directly or indirectly, by
          the stockholders of the Corporation in substantially the same proportions as
          their ownership of stock of the Corporation, is or becomes the &#147;beneficial
          owner&#148; (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Corporation representing 20% or more of the
          combined voting power of the Corporation&#146;s then outstanding securities; (B)
          during any period of two consecutive years, individuals who at the beginning of
          that period constitute the Board and any new director (other than a director
          designated by a person who has entered into an agreement with the Corporation to
          effect a transaction described in clauses (A) or (D) of this Section) whose
          election by the Board or nomination for election by the Corporation&#146;s
          stockholders was approved by a vote of at least two-thirds of the directors then
          still in office who either were directors at the beginning of the period or
          whose election or nomination for election was previously so approved cease for
          any reason to constitute a majority of the Board; (C) the Corporation enters
          into an agreement, the consummation of which would result in the occurrence of a
          Change in Control of the Corporation; or (D) the stockholders of the Corporation
          approve a merger, share exchange or consolidation of the Corporation with any
          other corporation or entity, other than a merger, share exchange or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior thereto continuing to represent (either by
          remaining outstanding or by being converted into voting securities of the
          surviving entity) at least 60% of the combined voting power of the voting
          securities of the Corporation or the surviving entity outstanding immediately
          after the merger, share exchange or consolidation, or the stockholders of the
          Corporation approve a plan of complete liquidation of the Corporation or an
          agreement for the sale or disposition by the Corporation of all or substantially
          all the Corporation&#146;s assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Vesting of Stock Options</U>. Upon a Change in Control of the Corporation,
          you shall fully vest in all outstanding stock options granted to you under the
          Corporation&#146;s stock option plans. Each stock option shall continue to be
          exercisable for the term of that stock option. In accordance with the terms of
          The Black &amp; Decker Performance Equity Plan (the &#147;PEP&#148;) and The
          Black &amp; Decker Corporation 2004 Restricted Stock Plan, respectively, the
          maximum number (150% of the target award for each performance period) of
          Performance Shares (as defined in the PEP) held by you shall be deemed to have
          been earned (and shall be paid in accordance with the payment provisions of the
          PEP) and all shares of restricted stock held by you shall become fully vested
          and no longer subject to forfeiture upon the occurrence of a Change in Control
          of the Corporation. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Termination Following Change in Control of the Corporation</U>. If a Change
          in Control of the Corporation shall have occurred, you shall be entitled to the
          benefits provided in Section 5.2 upon the subsequent termination of your
          employment during the term of this Agreement unless the termination is (A)
          because of your death or Disability (as defined in</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 3</FONT></P>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 4.1), (B) by the
          Corporation for Cause (as defined in Section 4.2), or (C) by you other than for
          Good Reason (as defined in Section 4.3). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Disability</U>. If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with the
Corporation for six consecutive months and, within 30 days after a Notice of Termination
(as defined in Section 4.4) is given to you, shall not have returned to the full-time
performance of your duties, your employment may be terminated for &#147;Disability.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Cause</U>. Termination by the Corporation of your employment for &#147;Cause&#148;
shall mean termination upon (a) the willful and continued failure by you to substantially
perform your duties with the Corporation (other than any such failure resulting from your
incapacity due to physical or mental illness or any such actual or anticipated failure
after the issuance by you of a Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that you have not
substantially performed your duties, or (b) the willful engaging by you in conduct that is
demonstrably and materially injurious to the Corporation, monetarily or otherwise. For
purposes of this Section 4.2, no act or failure to act on your part shall be deemed
&#147;willful&#148; unless done, or omitted to be done, by you not in good faith and
without reasonable belief that your action or omission was in the best interest of the
Corporation. Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to you a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to you and an opportunity for you, together with your counsel, to
be heard before the Board), finding that in the good faith opinion of the Board you were
guilty of conduct set forth above in clauses (a) or (b) of the first sentence of this
Section 4.2 and specifying the particulars thereof in detail. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Good Reason</U>. You shall be entitled to terminate your employment for Good Reason.
For purposes of this Agreement, &#147;Good Reason&#148; shall mean, without your express
written consent, the occurrence after a Change in Control of the Corporation of any of the
following circumstances unless the circumstances are fully corrected prior to the Date of
Termination specified in the Notice of Termination given in respect thereof: </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the assignment to you of any duties inconsistent with your current status as an
               executive of the Corporation or a substantial adverse alteration in the nature
               or status of your responsibilities from those in effect immediately prior to the
               Change in Control of the Corporation; </FONT></P></TD>
               </TR>
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               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               a reduction by the Corporation in your annual base salary as in effect on the
               date of this Agreement or any subsequently established higher annual base
               salary, except for across-the-board salary reductions similarly affecting all
               senior executives of the Corporation and all senior executives of any person in
               control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 4</FONT></P>



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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               your relocation to a location not within 25 miles of your office or job location
               immediately prior to the Change in Control of the Corporation, except for
               required travel on the Corporation&#146;s business to an extent substantially
               consistent with your business travel obligations immediately prior to the Change
               in Control of the Corporation; </FONT></P></TD>
               </TR>
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               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation, without your consent, to pay to you any portion
               of your compensation to which you are entitled when such compensation is due; </FONT></P></TD>
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               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any compensation plan in
               which you participated immediately prior to the Change in Control of the
               Corporation that is material to your total compensation, including but not
               limited to the Corporation&#146;s (i) Executive Annual Incentive Plan
               (&#147;EAIP&#148;), Annual Incentive Plan (&#147;AIP&#148;) or other comparable
               annual compensation plan, (ii) stock option and restricted stock plans, and
               (iii) PEP or other comparable medium- or long-term compensation plan, or any
               substitute plan or plans adopted prior to the Change in Control of the
               Corporation; unless an equitable arrangement (embodied in an ongoing substitute
               or alternative plan) has been made with respect to the plan and the equitable
               arrangement provides substantially equivalent benefits not materially less
               favorable to you (both in terms of the amount of benefits provided and the level
               of your participation relative to other participants), or the failure by the
               Corporation to continue your participation therein (or in such substitute or
               alternative plan) on a basis not materially less favorable (both in terms of the
               amount of benefits provided and the level of your participation relative to
               other participants) than those you enjoyed immediately prior to the Change in
               Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure by the Corporation to continue in effect any material benefit
               available to you immediately prior to the Change in Control of the Corporation,
               including without limitation (i) the failure to provide to you benefits
               substantially similar to those enjoyed by you under any of the
               Corporation&#146;s retirement, savings, life insurance, medical, dental, health
               and accident, or disability plans in which you were participating at the time of
               the Change in Control of the Corporation, (ii) the failure to continue to
               provide to you any material perquisite provided to you at the time of the Change
               in Control of the Corporation, (iii) the failure by the Corporation to provide
               to you the number of paid vacation days to which you are entitled on the basis
               of years of service with the Corporation in accordance with the
               Corporation&#146;s normal vacation policy in effect at the time of the Change in
               Control of the Corporation, or (iii) the taking of any action by the Corporation
               that would directly or indirectly materially reduce any of these benefits or
               deprive you of any material benefit or perquisite enjoyed by you at the time of
               the Change in Control of the Corporation; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 5</FONT></P>





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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the failure of the Corporation to obtain a satisfactory agreement from any
               successor to assume and agree to perform this Agreement, as contemplated in
               Section&nbsp;7.1; or </FONT></P></TD>
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               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               any purported termination of your employment that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 4.4 (and, if
               applicable, the requirements of Section 4.2), which purported termination shall
               not be effective for purposes of this Agreement. </FONT></P></TD>
               </TR>
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               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Your rights to terminate your
employment pursuant to this Section 4.3 shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not constitute consent to, or
a waiver of rights with respect to, any circumstance constituting Good Reason under this
Section 4.3. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Notice of Termination</U>. Any purported termination of your employment by the
Corporation for Cause or Disability or by you for Good Reason shall be communicated by
written Notice of Termination to the other party in accordance with Section 8. For
purposes of this Agreement, a &#147;Notice of Termination&#148; shall mean a notice that
indicates the specific termination provision in this Agreement relied upon and that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Date of Termination</U>. Subject to the following sentence, &#147;Date of
Termination&#148; shall mean (a) if your employment is terminated by your death, the date
of your death; (b) if your employment is terminated for Disability, 30 days after Notice
of Termination is given (provided that you shall not have returned to the full-time
performance of your duties during the 30-day period); and (c) if your employment is
terminated for any reason other than death or Disability, the date specified in the Notice
of Termination. For purposes of clause (c) in the immediately preceding sentence, the date
specified in the Notice of Termination shall not be less than 30 days from the date the
Notice of Termination is given, except in the case of a termination pursuant to Section
4.3 such date shall not be less than 15 nor more than 60 days from the date that the
Notice of Termination is given. If the party receiving the Notice of Termination notifies
the other party within 15 days of receiving the Notice of Termination or, if later, prior
to the Date of Termination (as determined without regard to this sentence) that a dispute
exists concerning the termination, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or decree of a court of competent
jurisdiction (which is not appealable or with respect to which the time for appeal has
expired and no appeal has been perfected). The Date of Termination shall be extended by a
notice of dispute only if the notice is given in good faith and the party giving the
notice pursues the resolution of the dispute with reasonable diligence. Notwithstanding
the pendency of the dispute, the Corporation will continue to pay you your full
compensation in effect when the Notice of Termination giving rise to the dispute was given
(including, but not limited to, base salary) and continue you as a participant in all
compensation, benefit and insurance plans in which you were participating </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 6</FONT></P>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>when the notice
giving rise to the dispute was given, until the dispute is finally resolved in accordance
with this Section 4.5. Amounts paid under this Section 4.5 are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compensation Upon Termination</U>. Upon termination of your employment
          following a Change in Control of the Corporation, you shall be entitled to the
          following benefits: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Termination for Cause or Without Good Reason or upon Disability or Death</U>. If your
employment shall be terminated by your death, by the Corporation for Cause or Disability,
or by you without Good Reason, the Corporation shall pay you your full base salary through
the Date of Termination at the rate in effect at the time of your death or Notice of
Termination is given, as the case may be, plus all other amounts to which you are entitled
under any retirement, insurance and other compensation programs of the Corporation at the
time the payments are due, and the Corporation shall have no further obligations to you
under this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Termination Without Cause or Disability or for Good Reason</U>. If your employment by
the Corporation shall be terminated (A) by the Corporation other than for Cause or
Disability or (B) by you for Good Reason, then you shall be entitled to the benefits
provided below: </FONT></P>

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               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall pay you your full base salary through the Date of
               Termination at the rate in effect at the time Notice of Termination is given,
               plus all other amounts to which you are entitled under any compensation plan of
               the Corporation, at the time those payments are due, except as otherwise
               provided below. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               In lieu of any further salary payments to you for periods subsequent to the Date
               of Termination, the Corporation shall pay as severance pay to you a lump sum
               severance payment (the &#147;Severance Payment&#148;) in an amount equal to: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>



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               <TR VALIGN=TOP>
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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               three times the sum of your (x) annual base salary in effect immediately prior
to the occurrence of the circumstance giving rise to the Notice of Termination, and (y)
Maximum Participant Award (as defined below); <U>plus</U></FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               150% of the product of (A) your annual base salary in effect immediately prior
to your Date of Termination <U>multiplied by</U> (B) the percentage target used to
calculate the number of Performance Shares awarded to you with respect to the most recent
award under the PEP.</FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Maximum Participant Award&#148;
means the maximum award that could be payable to you under the terms of the EAIP (if you
were a participant in the EAIP immediately prior to the occurrence of the circumstances
giving rise to the Notice of Termination), the AIP (if you were a participant in the AIP
immediately prior to the occurrence of the circumstances giving rise to the Notice of</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 7</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Termination), or other comparable or substitute annual compensation plan for the year in
which the Date of Termination occurs, determined as if you remained a participant until
the end of the year and all performance goals for that year that would entitle you to a
maximum payment were met or exceeded. </FONT></P>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Corporation shall also pay to you all legal fees and expenses incurred by
               you as a result of the termination (including all legal fees and expenses, if
               any, incurred in contesting or disputing the termination or in seeking to obtain
               or enforce any right or benefit provided by this Agreement or in connection with
               any tax audit or proceeding to the extent attributable to the application of
               Section 4999 of the Internal Revenue Code (the &#147;Code&#148;) to any payment
               or benefit provided under this Agreement). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The Severance Payment plus interest shall be made on the date that is six months
               and one day following your &#147;separation from service&#148; as defined in
               Section 409A of the Code and the regulations promulgated thereunder. The
               Severance Payment shall bear interest at an annualized rate of 4.5% from and
               after your &#147;Separation from Service&#148; until paid pursuant to this
               Section 5.2(d). </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
<U>Additional Benefits</U>. If your employment shall be terminated (a) by the Corporation
other than for Cause or Disability or (b)&nbsp;by you for Good Reason, then for a 36-month
period after such termination, the Corporation shall arrange to provide to you life,
disability, accident, medical, dental and health insurance benefits substantially similar
to those that you are receiving immediately prior to the Notice of Termination. Benefits
otherwise receivable by you pursuant to this Section 5.3 shall be reduced to the extent
comparable benefits are actually received by you from another employer during the 36-month
period following your termination, and any such benefits actually received by you shall be
reported to the Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
<U>Mitigation</U>. You shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise. The Corporation
shall not be entitled to set off against the amount of any payment or benefit provided for
in this Agreement any amounts owed to the Corporation by you, any compensation earned by
you as the result of employment by another employer, or any retirement benefits to which
you may be entitled under the Corporation&#146;s retirement or savings plans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
<U>Other Benefit Plans</U>. In addition to all other amounts payable to you under this
Section 5, you shall be entitled to receive all benefits payable to you under any plan or
agreement sponsored by the Corporation or any of its subsidiaries relating to retirement
or other benefits in accordance with the terms of such plans or arrangements. </FONT></P>

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<A NAME=A004></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Gross-Up Payment.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Calculation of Gross-Up Payment</U>. If the Severance Payment or any other portion of
the Total Payments (as defined below) will be subject to the tax imposed by Section 4999
of the Code (the &#147;Excise Tax&#148;), the Corporation shall pay to you at the time
specified in </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 8</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Section 6.2 an additional amount (the &#147;Gross-Up Payment&#148;) such that
the net amount retained by you, after deduction of any Excise Tax on the Severance Payment
and such other Total Payments and any federal and state and local income tax and Excise
Tax upon the Gross-Up Payment, shall be equal to the Severance Payment and such other
Total Payments. For purposes of determining whether any of the payments will be subject to
the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received or to be received by you in connection with a Change in Control of the
Corporation or your termination of employment (whether payable pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Corporation, its
successors, any person whose actions result in a Change in Control of the Corporation or
any corporation affiliated (or which, as a result of the completion of a transaction
causing a Change in Control of the Corporation, will become affiliated) with the
Corporation within the meaning of Section 1504 of the Code) (together with the Severance
Payment, the &#147;Total Payments&#148;) shall be treated as &#147;parachute
payments&#148; within the meaning of Section 280G(b)(2) of the Code, and all &#147;excess
parachute payments&#148; within the meaning of Section 280G(b)(1) shall be treated as
subject to the Excise Tax, unless in the opinion of tax counsel selected by the
Corporation and acceptable to you (&#147;Tax Counsel&#148;) the Total Payments (in whole
or in part) do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually rendered within
the meaning of Section 280G(b)(4)(B) of the Code either to the extent such reasonable
compensation is in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code or are otherwise not subject to the Excise Tax, (ii) the amount of the Total
Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser
of (A) the total amount of the Total Payments or (B) the amount of excess parachute
payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit shall be
determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4)
of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be
deemed to pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. If the Excise Tax is
subsequently determined to be less than the amount taken into account under this Section
6.1 at the time of payment of the Gross-Up Payment, you shall repay to the Corporation at
the time that the amount of such reduction in the Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction (plus the portion of the
Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax
imposed on the Gross-Up Payment being repaid by you if such repayment results in a
reduction in Excise Tax and/or a federal and state and local income tax deduction) plus
interest on the amount of such repayment at the rate provided in Section 1274(d) of the
Code. If the Excise Tax is determined to exceed the amount taken into account hereunder at
the time of payment of the Gross-Up Payment (including by reason of any payment resulting
from the existence or amount of which cannot be determined at the time of the payment of
the Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties, and professional fees </FONT></P>

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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 9</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>incurred by
you with respect to such excess, including all such taxes with respect to such additional
amount) at the time that the amount of such excess is finally determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
<U>Payment of Gross-Up Payments</U>. The payments provided for in Section 6.1 shall be
made on the date that is six months and one day following your &#147;separation of
service&#148; as defined in Section 409A of the Code and the regulations promulgated
thereunder. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Successors; Binding Agreement</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Successors</U>. The Corporation will require any successor to all or substantially all
of the business or assets of the Corporation (whether direct or indirect, by purchase,
merger, share exchange, consolidation or otherwise) to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform it if the succession had not taken place. Failure of the
Corporation to obtain the assumption and agreement prior to the effectiveness of the
succession shall be a breach of this Agreement and shall entitle you to terminate your
employment for Good Reason following a Change in Control of the Corporation. As used in
this Agreement, &#147;Corporation&#148; shall mean the Corporation as hereinbefore defined
and any successor to its business or assets as described above that assumes and agrees to
perform this Agreement by operation of law or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Binding Agreement</U>. This Agreement shall inure to the benefit of and be enforceable
by your personal or legal representatives, executors, administrators, heirs, distributees,
and legatees. Any amount payable to you under this Agreement at the time of your death,
unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to your legatee or other designee or, if there is no such designee, to your
estate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Employment by a Subsidiary</U>. If you are employed by a subsidiary of the Corporation,
wherever in this Agreement reference is made to the &#147;Corporation,&#148; unless the
context otherwise requires, the reference shall also include the subsidiary. The
Corporation shall cause the subsidiary to carry out the terms of this Agreement insofar as
they relate to the employment relationship between you and the subsidiary, and the
Corporation shall indemnify you and save you harmless from and against all liability and
damage that you may suffer as a consequence of the subsidiary&#146;s failure to perform
and carry out such terms. Wherever reference is made to any benefit program of the
Corporation, the reference shall include, where appropriate, the corresponding benefit
program of the subsidiary if you were a participant in the benefit program on the date a
Change in Control of the Corporation has occurred. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Notice</U>. For the purpose of this Agreement, notices and all other
          communications provided for in the Agreement shall be in writing and shall be
          deemed to have been duly given when delivered or mailed by United States
          registered mail, return receipt requested, postage prepaid. All notices to the
          Corporation shall be sent to the Corporation at 701 East Joppa Road, Towson,
          Maryland 21286 and directed to the attention of the Board with a copy to the
          Secretary of the Corporation and to you at your address listed on the
          Corporation&#146;s payroll, or to such other</FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 10</FONT></P>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>address as either party may have
          furnished to the other in writing in accordance herewith, except that notice of
          change of address shall be effective only upon receipt. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Miscellaneous</U>. No provision of this Agreement may be modified, waived or
          discharged unless the waiver, modification or discharge is agreed to in writing
          and signed by you and an officer of the Corporation specifically designated by
          the Board. No waiver by either party at any time of any breach by the other
          party of any condition or provision of this Agreement to be performed by the
          other party shall be deemed a waiver of similar or dissimilar provisions or
          conditions at the same or at any prior or subsequent time. This Agreement
          constitutes the entire agreement between the parties hereto in respect of the
          matters set forth herein, and all prior negotiations, writings and
          understandings relating to the subject matter of this Agreement are superseded
          and cancelled by this Agreement. The validity, interpretation, construction and
          performance of this Agreement shall be governed by the laws of the State of
          Maryland, without regard to its principles of conflicts of laws. All references
          to sections of the Exchange Act or the Code shall be deemed also to refer to any
          successor provisions to such sections. Any payments provided for hereunder shall
          be paid net of any applicable withholding required under federal, state or local
          law. The obligations of the Corporation under Sections 5 and 6 shall survive the
          expiration of the term of this Agreement, provided that the Date of Termination
          occurred prior to such expiration. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Validity</U>. The invalidity or unenforceability of any provision of this
          Agreement shall not affect the validity or enforceability of any other provision
          of this Agreement, which shall remain in full force and effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Counterparts</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Arbitration</U>. Any dispute or controversy arising under or in connection
          with this Agreement shall be settled exclusively by arbitration in the State of
          Maryland, in accordance with the Commercial Arbitration Rules of the American
          Arbitration Association then in effect. Judgment may be entered on the
          arbitrator&#146;s award in any court having jurisdiction; provided, however,
          that you shall be entitled to seek specific performance of your right to be paid
          until the Date of Termination during the pendency of any dispute or controversy
          arising under or in connection with this Agreement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Section Headings</U>. The Section headings contained in this Agreement are
          for convenience of reference only and shall not limit or otherwise affect the
          meaning or interpretation of this Agreement or any of its terms and conditions.
          All references to Sections in this Agreement are to Sections of this Agreement. </FONT></P>


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<P ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Thomas D. Koos<BR>February 10, 2006<BR>Page 11</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you agree to the terms of this letter, please sign and return to the Corporation the
enclosed copy which will then constitute our agreement on this subject. </FONT></P>

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&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
     <TD WIDTH="50%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Sincerely,<BR><BR>THE BLACK &amp; DECKER CORPORATION
<BR><BR>
By: <U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>                          <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan D. Archibald, Chairman
</FONT></TD></TR></TABLE>
<BR><BR>

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     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Agreed to as of the 10th day of February, 2006<BR><BR><U> /s/ THOMAS D. KOOS&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>Thomas D. Koos</FONT></TD>
     <TD><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR></FONT></TD></TR>
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<FILENAME>form10k12312005u.htm
<DESCRIPTION>EXHIBIT 21
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 21<BR><BR><BR><BR><BR><BR><BR><BR></B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE BLACK &amp; DECKER
CORPORATION AND SUBSIDIARIES </FONT></H1>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LIST OF SUBSIDIARIES </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Listed below are the subsidiaries of
The Black &amp; Decker Corporation as of December 31, 2005. Names of certain inactive,
liquidated, or minor subsidiaries have been omitted. </FONT></P>




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     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Baldwin Hardware Corporation                              <BR>
Biesemeyer Manufacturing Corporation                      <BR>
Black &amp;Decker Abrasives Inc.                             <BR>
Black &amp; Decker Inc.                                       <BR>
Black &amp; Decker (U.S.) Inc.                                <BR>
Black &amp; Decker Funding Corporation                        <BR>
Black &amp; Decker Group Inc.                                 <BR>
Black &amp; Decker HealthCare Management Inc.                 <BR>
Black &amp; Decker Holdings Inc.                              <BR>
Black &amp; Decker Holdings LLC                               <BR>
Black &amp; Decker Investment Company                         <BR>
Black &amp; Decker Investments LLC                            <BR>
Black &amp; Decker Maryland LLC                               <BR>
Black &amp; Decker (Ireland) Inc.                             <BR>
Black &amp; Decker India Inc.                                 <BR>
Black &amp; Decker Investments (Australia) Limited            <BR>
Black &amp; Decker (Puerto Rico) LLC                          <BR>
Delta International Machinery Corp.                       <BR>
Devilbiss Air Power Company                               <BR>
Emglo Products LLC                                        <BR>
Emhart Credit Corporation                                 <BR>
Emhart Harttung Inc.                                      <BR>
EII Maryland LLC                                          <BR>
Emhart Teknologies LLC                                    <BR>
Kwikset Corporation                                       <BR>
Newfrey LLC                                               <BR>
Price Pfister Holdings Inc.                               <BR>
Price Pfister, Inc.                                       <BR>
Shenandoah Insurance, Inc.                                <BR>
Weiser Lock Corporation                                   <BR>
Black &amp; Decker Argentina S.A.                             <BR>
Black &amp; Decker (Australia) Pty. Ltd.                      <BR>
Black &amp; Decker Distribution Pty. Ltd.                     <BR>
Black &amp; Decker Finance (Australia) Ltd.                   <BR>
Black &amp; Decker Holdings (Australia) Pty. Ltd.             <BR>


</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="25%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;UNITED STATES<BR>
&nbsp;&nbsp;ARGENTINA<BR>
&nbsp;&nbsp;AUSTRALIA<BR>
&nbsp;&nbsp;AUSTRALIA<BR>
&nbsp;&nbsp;AUSTRALIA<BR>
&nbsp;&nbsp;AUSTRALIA<BR>



</FONT></TD></TR>
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     <TH ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Kwikset (Australasia) Pty. Ltd.                           <BR>
Black &amp; Decker Werkzeuge Vertriebs-Gesellschaft M.B.H     <BR>
Black &amp; Decker (Belgium) N.V.                             <BR>
Black &amp; Decker Do Brasil Ltda.                            <BR>
Refal Industria e Comercio de Rebites e Rebitadeiras Ltda.<BR>
Black &amp; Decker Canada Inc.                                <BR>
Black &amp; Decker Holdings (Canada) Inc.                     <BR>
Jointech Corporation, Ltd.                                <BR>
Wintech Corporation Limited                               <BR>
Maquinas y Herramientas Black &amp; Decker de Chile S.A.      <BR>
Anzi Masterfix Tool Ltd.                                  <BR>
Black &amp; Decker (Xiamen) Industrial Co. Ltd.               <BR>
Black &amp; Decker (Suzhou) Co. Ltd.                          <BR>
Black &amp; Decker (Suzhou) Power Tools Co., Ltd.             <BR>
Qingdao Sungun Power Tool Co., Ltd.                       <BR>
Shanghai Emhart Fastening Systems Ltd.                    <BR>
Wisetech (Suzhou) Industrial Co. Limited                  <BR>
Black &amp; Decker de Colombia S.A.                           <BR>
Black &amp; Decker (Czech) S.R.O.                             <BR>
Tucker S.R.O.                                             <BR>
Emhart Harttung A/S                                       <BR>
Black &amp; Decker de El Salvador, S.A. de C.V.               <BR>
Black &amp; Decker Oy                                         <BR>
Black &amp; Decker Finance ScA.                               <BR>
Black &amp; Decker (France) S.A.S.                            <BR>
Emhart Fastening &amp; Assembly SNC                           <BR>
Emhart S.A.R.L.                                           <BR>
BD Beteiligungs G.m.b.H. &amp; Co. K.G.                       <BR>
B.B.W. Bayrische Bohrerwerke G.m.b.H.                     <BR>
Black &amp; Decker G.m.b.H.                                   <BR>
Masterfix Verbindungssysteme GMBH                         <BR>
Tucker G.m.b.H.                                           <BR>
Black &amp; Decker (Hellas) S.A.                              <BR>
Black &amp; Decker Hong Kong Limited                          <BR>
Emhart Asia Limited                                       <BR>
Hangtech Limited                                          <BR>
Baltimore Financial Services Company                      <BR>
Baltimore Insurance Limited                               <BR>
Belco Investments Company                                 <BR>
Black &amp; Decker (Ireland)                                  <BR>
Chesapeake Falls Holdings Company                         <BR>
Gamrie Limited                                            <BR>
Black &amp; Decker Italia S.P.A.                              <BR>
Fasteners &amp; Tools, Ltd.                                   <BR>
Nippon Pop Rivets &amp; Fasteners Ltd.                        <BR>

</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="25%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;AUSTRALIA<BR>
&nbsp;&nbsp;AUSTRIA<BR>
&nbsp;&nbsp;BELGIUM<BR>
&nbsp;&nbsp;BRAZIL<BR>
&nbsp;&nbsp;BRAZIL<BR>
&nbsp;&nbsp;CANADA<BR>
&nbsp;&nbsp;CANADA<BR>
&nbsp;&nbsp;CAYMAN ISLANDS<BR>
&nbsp;&nbsp;CAYMAN ISLANDS<BR>
&nbsp;&nbsp;CHILE<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;CHINA<BR>
&nbsp;&nbsp;COLOMBIA<BR>
&nbsp;&nbsp;CZECH REPUBLIC<BR>
&nbsp;&nbsp;CZECH REPUBLIC<BR>
&nbsp;&nbsp;DENMARK<BR>
&nbsp;&nbsp;EL SALVADOR<BR>
&nbsp;&nbsp;FINLAND<BR>
&nbsp;&nbsp;FRANCE<BR>
&nbsp;&nbsp;FRANCE<BR>
&nbsp;&nbsp;FRANCE<BR>
&nbsp;&nbsp;FRANCE<BR>
&nbsp;&nbsp;GERMANY<BR>
&nbsp;&nbsp;GERMANY<BR>
&nbsp;&nbsp;GERMANY<BR>
&nbsp;&nbsp;GERMANY<BR>
&nbsp;&nbsp;GERMANY<BR>
&nbsp;&nbsp;GREECE<BR>
&nbsp;&nbsp;HONG KONG<BR>
&nbsp;&nbsp;HONG KONG<BR>
&nbsp;&nbsp;HONG KONG<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;IRELAND<BR>
&nbsp;&nbsp;ITALY<BR>
&nbsp;&nbsp;JAPAN<BR>
&nbsp;&nbsp;JAPAN<BR>


</FONT></TD></TR>
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<TR VALIGN="TOP">
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Black &amp; Decker (Overseas) A.G.                            <BR>
Black &amp; Decker Limited S.A.R.L.                           <BR>
Black &amp; Decker Luxembourg Finance S.C.A.                  <BR>
Black &amp; Decker Luxembourg S.A.R.L.                        <BR>
Chesapeake Investments Company S.A.R.L.                   <BR>
Black &amp; Decker Macao                                      <BR>
Black &amp; Decker Asia Pacific (Malaysia) Sdn. Bhd.          <BR>
Black &amp; Decker (Malaysia) Sdn. Bhd.                       <BR>
Black &amp; Decker de Reynosa S. de R.L. de C.V.              <BR>
Black &amp; Decker HHI Mexico, S. de  R.L. de C.V.            <BR>
Black &amp; Decker, S.A. de C.V.                              <BR>
DeWalt Industrial Tools, S.A. de C.V.                     <BR>
Weiser Lock Mexico, S. De R.L. De C.V.                    <BR>
Black &amp; Decker (Nederland) B.V.                           <BR>
Black &amp; Decker Far East Holdings B.V.                     <BR>
Black &amp; Decker Hardware Holdings B.V.                     <BR>
Black &amp; Decker International Holdings B.V.                <BR>
Black &amp; Decker Overseas Holdings B.V.                     <BR>
Interfast B.V.                                            <BR>
Masterfix Products B.V.                                   <BR>
Black &amp; Decker (New Zealand) Limited                      <BR>
Black &amp; Decker (Norge) A/S                                <BR>
Emhart Sjong  A/S                                         <BR>
Black &amp; Decker de Panama, S.A.                            <BR>
Black &amp; Decker International Corporation                  <BR>
Emhart Panama S.A.                                        <BR>
Black &amp; Decker Del Peru S.A.                              <BR>
Masterfix Poland                                          <BR>
Black &amp; Decker Asia Pacific Pte. Ltd.                     <BR>
Emhart Fastening Teknologies Korea, Inc.                  <BR>
Black &amp; Decker Iberica S.Com por A.                       <BR>
Black &amp; Decker Aktiebolag                                 <BR>
Emhart Teknik Akteibolag                                  <BR>
Black &amp; Decker (Switzerland) S.A.                         <BR>
Emhart A.G.                                               <BR>
Joinery Industrial Co., Ltd.                              <BR>
Pentair Taiwan LLC                                        <BR>
Black &amp; Decker (Thailand) Limited                         <BR>
Emhart Teknologies (Thailand) Ltd.                        <BR>
Aven Tools Limited                                        <BR>
Bandhart                                                  <BR>
Bandhart Overseas                                         <BR>
Black &amp; Decker Batteries Management Limited               <BR>
Black &amp; Decker Finance                                    <BR>
Black &amp; Decker International                              <BR>



</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="25%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;LIECHTENSTEIN<BR>
&nbsp;&nbsp;LUXEMBOURG<BR>
&nbsp;&nbsp;LUXEMBOURG<BR>
&nbsp;&nbsp;LUXEMBOURG<BR>
&nbsp;&nbsp;LUXEMBOURG<BR>
&nbsp;&nbsp;MACAO<BR>
&nbsp;&nbsp;MALAYSIA<BR>
&nbsp;&nbsp;MALAYSIA<BR>
&nbsp;&nbsp;MEXICO<BR>
&nbsp;&nbsp;MEXICO<BR>
&nbsp;&nbsp;MEXICO<BR>
&nbsp;&nbsp;MEXICO<BR>
&nbsp;&nbsp;MEXICO<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NETHERLANDS<BR>
&nbsp;&nbsp;NEW ZEALAND<BR>
&nbsp;&nbsp;NORWAY<BR>
&nbsp;&nbsp;NORWAY<BR>
&nbsp;&nbsp;PANAMA<BR>
&nbsp;&nbsp;PANAMA<BR>
&nbsp;&nbsp;PANAMA<BR>
&nbsp;&nbsp;PERU<BR>
&nbsp;&nbsp;POLAND<BR>
&nbsp;&nbsp;SINGAPORE<BR>
&nbsp;&nbsp;SOUTH KOREA<BR>
&nbsp;&nbsp;SPAIN<BR>
&nbsp;&nbsp;SWEDEN<BR>
&nbsp;&nbsp;SWEDEN<BR>
&nbsp;&nbsp;SWITZERLAND<BR>
&nbsp;&nbsp;SWITZERLAND<BR>
&nbsp;&nbsp;TAIWAN<BR>
&nbsp;&nbsp;TAIWAN<BR>
&nbsp;&nbsp;THAILAND<BR>
&nbsp;&nbsp;THAILAND<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>



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<TR VALIGN="TOP">
     <TD WIDTH="60%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Black &amp; Decker                                            <BR>
Black &amp; Decker Europe                                     <BR>
Emhart International Limited                              <BR>
Masterfix Products U.K. Ltd.                              <BR>
Masterfix UK Holdings Limited                             <BR>
Tucker Fasteners Limited                                  <BR>
Black &amp; Decker de Venezuela, C.A.                         <BR>
Black &amp; Decker Holdings de Venezuela, C.A.                <BR>



</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TD>
     <TD WIDTH="25%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;UNITED KINGDOM<BR>
&nbsp;&nbsp;VENEZUELA<BR>
&nbsp;&nbsp;VENEZUELA


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<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>22
<FILENAME>form10k12312005v.htm
<DESCRIPTION>EXHIBIT 23
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 23</B></FONT></P>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consent of Independent
Registered Public Accounting Firm </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>We consent to the incorporation by
reference in the following Registration Statements of The Black &amp; Decker Corporation
of our reports dated February 14, 2006, with respect to the consolidated financial
statements and schedule of The Black &amp; Decker Corporation, The Black &amp; Decker
Corporation&#146;s management&#146;s assessments of the effectiveness of internal control
over financial reporting, and the effectiveness of internal control over financial
reporting of The Black &amp; Decker Corporation, included in this Annual Report (Form
10-K) for the year ended December 31, 2005. </FONT></P>


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     <TH COLSPAN=2><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
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<TR VALIGN=Bottom>
     <TD WIDTH=48% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Registration Statement Number</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=48% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Description</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33-26917</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33-33251</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33-47652</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33-58795</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>33-65013</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-03593</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-51155</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-51157</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-35986</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-113283</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>333-115301</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form S-8</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>


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<A NAME=A002></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ ERNST &amp; YOUNG, LLP</U> <BR>Baltimore, Maryland<BR>February
14, 2006 </FONT></P>


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<TYPE>EX-24
<SEQUENCE>23
<FILENAME>form10k12312005w.htm
<DESCRIPTION>EXHIBIT 24
<TEXT>
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<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>EXHIBIT 24</B></FONT></P>
<H1 ALIGN="Center"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>POWER OF ATTORNEY</U></B></FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We,
the undersigned Directors and Officers of The Black &amp; Decker Corporation (the
&#147;Corporation&#148;), hereby constitute and appoint Nolan D. Archibald, Michael D.
Mangan and Charles&nbsp;E. Fenton, and each of them, with power of substitution, our true
and lawful attorneys-in-fact with full power to sign for us, in our names and in the
capacities indicated below, the Corporation&#146;s Annual Report on Form 10-K for the year
ended December 31, 2005, and any and all amendments thereto. </FONT></P>

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     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="37%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR><U>/S/ NOLAN D. ARCHIBALD
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR> Nolan D. Archibald
<BR><BR><BR><BR>
<U>/S/ NORMAN R. AUGUSTINE&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Norman R. Augustine <BR> <BR>

<U>/S/ BARBARA L. BOWLES&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> <BR>
Barbara L. Bowles <BR>
<BR>
<U>/S/ M. ANTHONY BURNS&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> <BR>
M. Anthony Burns<BR><BR>

<U>/S/ KIM B. CLARK &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Kim B. Clark<BR><BR>

<U>/S/ MANUEL A. FERNANDEZ &nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Manuel A. Fernandez<BR><BR>

<U>/S/ BENJAMIN H. GRISWOLD, IV
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Benjamin H. Griswold, IV<BR><BR>

<U>/S/ ANTHONY LUISO &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Anthony Luiso<BR><BR>








</FONT></TD>
     <TD WIDTH="31%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>Director, Chairman, President<BR>and Chief Executive Officer<BR>(Principal Executive Officer)
<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>



</FONT></TD>
     <TD WIDTH="32%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>February 9, 2006<BR>
<BR>
<BR><BR><BR>

February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR>
<BR>

</FONT></TD></TR>
</TABLE>



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<DIV STYLE="page-break-after:always"></DIV>

<TABLE WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM">
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH>
     <TH ALIGN="Left"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="37%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">
<U>/S/ ROBERT L. RYAN &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Robert L. Ryan<BR><BR>

<U>/S/ MARK H. WILLES &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Mark H. Willes<BR><BR>

<U>/S/ MICHAEL D. MANGAN &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Michael D. Mangan<BR><BR><BR>

<U>/S/ CHRISTINA M. McMULLEN &nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Christina M. McMullen<BR><BR>

</FONT></TD>
     <TD WIDTH="31%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">
Director<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Senior Vice President and<BR>
Chief Financial Officer<BR>
(Principal Financial Officer)<BR>
<BR>
Vice President and Controller<BR>
(Principal Accounting Officer)


</FONT></TD>
     <TD WIDTH="32%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">February 9, 2006<BR>

<BR>
<BR>
February 9, 2006<BR>

<BR><BR>

February 9, 2006<BR>

<BR><BR><BR>

February 9, 2006<BR>
</FONT></TD></TR>
</TABLE>

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<DIV STYLE="page-break-after:always"></DIV>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>24
<FILENAME>form10k12312005x.htm
<DESCRIPTION>EXHIBIT 31.1
<TEXT>

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<TITLE></TITLE>
</HEAD>
<BODY>
<!-- MARKER FORMAT-SHEET="Head Right" FSL="Default" -->
<A NAME=A192></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 31.1</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A193></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
CORPORATION</B><BR></FONT><FONT FACE="Times New Roman, Times, Serif" SIZE=3><B>CERTIFICATIONS</B>  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A194></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>I, Nolan D. Archibald, certify that: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    I have reviewed this annual report on Form 10-K of The Black &amp; Decker
                    Corporation; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Based on my knowledge, this report does not contain any untrue statement of a
                    material fact or omit to state a material fact necessary to make the statements
                    made, in light of the circumstances under which such statements were made, not
                    misleading with respect to the period covered by this report; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Based on my knowledge, the financial statements, and other financial information
                    included in this report, fairly present in all material respects the financial
                    condition, results of operations and cash flows of the registrant as of, and
                    for, the periods presented in this report; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The registrant&#146;s other certifying officer(s) and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial
                    reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
                    registrant and have: </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Designed such disclosure controls and procedures, or caused such disclosure
               controls and procedures to be designed under our supervision, to ensure that
               material information relating to the registrant, including its consolidated
               subsidiaries, is made known to us by others within those entities, particularly
               during the period in which this report is being prepared; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Designed such internal control over financial reporting, or caused such internal
               control over financial reporting to be designed under our supervision, to
               provide reasonable assurance regarding the reliability of financial reporting
               and the preparation of financial statements for external purposes in accordance
               with generally accepted accounting principles; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>c) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Evaluated the effectiveness of the registrant&#146;s disclosure controls and
               procedures and presented in this report our conclusions about the effectiveness
               of the disclosure controls and procedures, as of the end of the period covered
               by this report based on such evaluation; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>d) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Disclosed in this report any change in the registrant&#146;s internal control
               over financial reporting that occurred during the registrant&#146;s most recent
               fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case of an
               annual report) that has materially affected, or is reasonably likely to
               materially affect, the registrant&#146;s internal control over financial
               reporting; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The registrant&#146;s other certifying officer(s) and I have disclosed, based on
                    our most recent evaluation of internal control over financial reporting, to the
                    registrant&#146;s auditors and the audit committee of the registrant&#146;s
                    board of directors (or persons performing the equivalent functions): </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               All significant deficiencies and material weaknesses in the design or operation
               of internal control over financial reporting which are reasonably likely to
               adversely affect the registrant&#146;s ability to record, process, summarize and
               report financial information; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Any fraud, whether or not material, that involves management or other employees
               who have a significant role in the registrant&#146;s internal control over
               financial reporting. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Head Sub 3 Left" FSL="Default" -->
<A NAME=A195></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/&nbsp;&nbsp;&nbsp;&nbsp;NOLAN
D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nolan
D. Archibald<BR><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman,
President, and Chief Executive Officer<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;February 14, 2006</I> </FONT></P>


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<DIV STYLE="page-break-after:always"></DIV>


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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>25
<FILENAME>form10k12312005y.htm
<DESCRIPTION>EXHIBIT 31.2
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>

<!-- MARKER FORMAT-SHEET="Head Right" FSL="Default" -->
<A NAME=A197></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 31.2</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<A NAME=A198></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>THE BLACK &amp; DECKER
CORPORATION</B><BR></FONT><FONT FACE="Times New Roman, Times, Serif" SIZE=3><B>CERTIFICATIONS</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>I, Michael D. Mangan, certify that: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    I have reviewed this annual report on Form 10-K of The Black &amp; Decker
                    Corporation; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Based on my knowledge, this report does not contain any untrue statement of a
                    material fact or omit to state a material fact necessary to make the statements
                    made, in light of the circumstances under which such statements were made, not
                    misleading with respect to the period covered by this report; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    Based on my knowledge, the financial statements, and other financial information
                    included in this report, fairly present in all material respects the financial
                    condition, results of operations and cash flows of the registrant as of, and
                    for, the periods presented in this report; </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The registrant&#146;s other certifying officer(s) and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial
                    reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
                    registrant and have: </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Designed such disclosure controls and procedures, or caused such disclosure
               controls and procedures to be designed under our supervision, to ensure that
               material information relating to the registrant, including its consolidated
               subsidiaries, is made known to us by others within those entities, particularly
               during the period in which this report is being prepared; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Designed such internal control over financial reporting, or caused such internal
               control over financial reporting to be designed under our supervision, to
               provide reasonable assurance regarding the reliability of financial reporting
               and the preparation of financial statements for external purposes in accordance
               with generally accepted accounting principles; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>c) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Evaluated the effectiveness of the registrant&#146;s disclosure controls and
               procedures and presented in this report our conclusions about the effectiveness
               of the disclosure controls and procedures, as of the end of the period covered
               by this report based on such evaluation; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>d) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Disclosed in this report any change in the registrant&#146;s internal control
               over financial reporting that occurred during the registrant&#146;s most recent
               fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case of an
               annual report) that has materially affected, or is reasonably likely to
               materially affect, the registrant&#146;s internal control over financial
               reporting; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 2" FSL="Default" -->
               <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
                    <TR VALIGN=TOP>
                    <TD ALIGN=RIGHT WIDTH=6%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5. </FONT></TD>
                    <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
                    <TD WIDTH=91%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
                    The registrant&#146;s other certifying officer(s) and I have disclosed, based on
                    our most recent evaluation of internal control over financial reporting, to the
                    registrant&#146;s auditors and the audit committee of the registrant&#146;s
                    board of directors (or persons performing the equivalent functions): </FONT></P></TD>
                    </TR>
                    </TABLE>
                    <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               All significant deficiencies and material weaknesses in the design or operation
               of internal control over financial reporting which are reasonably likely to
               adversely affect the registrant&#146;s ability to record, process, summarize and
               report financial information; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 4" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=12%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b) </FONT></TD>
               <TD ALIGN=LEFT WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
               <TD WIDTH=85%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Any fraud, whether or not material, that involves management or other employees
               who have a significant role in the registrant&#146;s internal control over
               financial reporting. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif"
SIZE=2><U>/s/&nbsp;&nbsp;&nbsp;&nbsp;MICHAEL D. MANGAN&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Michael D. Mangan<BR><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Senior Vice President and Chief Financial Officer<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;February 14, 2006</I> </FONT></P>


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<TYPE>EX-32
<SEQUENCE>26
<FILENAME>form10k12312005z.htm
<DESCRIPTION>EXHIBIT 32.1
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<P ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE="2"><B>Exhibit 32.1</B> </FONT></P>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2">CERTIFICATION PURSUANT
TO<BR>18 U.S.C. SECTION 1350,<BR>AS ADOPTED PURSUANT TO<BR>SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002</FONT></H1>


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<P><FONT FACE="Times New Roman" SIZE="2">In connection with the Annual
Report of The Black &amp; Decker Corporation (the &#147;Corporation&#148;) on Form 10-K
for the period ended December 31, 2005, as filed with the Securities and Exchange
Commission on the date hereof (the &#147;Report&#148;), I, Nolan D. Archibald, Chief
Executive Officer of the Corporation, certify, pursuant to 18 U.S.C. &sect; 1350, as
adopted pursuant to &sect; 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that: </FONT></P>

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     <P><FONT FACE="Times New Roman" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Report fully complies with the requirements of section 13(a) or 15(d) of the
          Securities Exchange Act of 1934; and </FONT></P>


<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- Arial" FSL="Project" -->
     <P><FONT FACE="Times New Roman" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The information contained in the Report fairly presents, in all material
          respects, the financial condition and results of operations of the Corporation. </FONT></P>


<BR>
<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0">
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     <TH><FONT FACE="Times New Roman" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman" SIZE="2"><U>/s/ NOLAN D. ARCHIBALD&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Nolan D. Archibald<BR>
Chief Executive Officer<BR>
February 14, 2006
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<TYPE>EX-32
<SEQUENCE>27
<FILENAME>form10k12312005aa.htm
<DESCRIPTION>EXHIBIT 32.2
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Exhibit 32.2</B> </FONT></P>


<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CERTIFICATION PURSUANT
TO<BR>18 U.S.C. SECTION 1350,<BR>AS ADOPTED PURSUANT TO<BR>SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002  </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>In connection with the Annual
Report of The Black &amp; Decker Corporation (the &#147;Corporation&#148;) on Form 10-K
for the period ended December 31, 2005, as filed with the Securities and Exchange Commission
on the date hereof (the &#147;Report&#148;), I, Michael D. Mangan, Chief Financial Officer
of the Corporation, certify, pursuant to 18 U.S.C. &sect; 1350, as adopted pursuant to
&sect; 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- Arial" FSL="Project" -->
     <P><FONT FACE="Times New Roman" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Report fully complies with the requirements of section 13(a) or 15(d) of the
          Securities Exchange Act of 1934; and </FONT></P>


<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- Arial" FSL="Project" -->
     <P><FONT FACE="Times New Roman" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The information contained in the Report fairly presents, in all material
          respects, the financial condition and results of operations of the Corporation. </FONT></P>
          <BR>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman" SIZE="2"></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD><FONT FACE="Times New Roman" SIZE="2"><U>/s/ MICHAEL D. MANGAN&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Michael D. Mangan<BR>
Chief Financial Officer<BR>
February 14, 2006
</FONT></TD></TR>
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