Corporate Governance Policies and Procedures Statement
Introductory Statement | Board of Directors | Standing Committees | Officers | Business Practices

A. Introductory Statement

This Statement is adopted by the Board of Directors of The Black & Decker Corporation to set out the policies and procedures by which the Board performs its duties to direct the management of the Corporation as provided in the laws of Maryland, to assure compliance with state and federal laws and regulations and applicable rules of the New York Stock Exchange (NYSE), and to assure that the Corporation acts effectively and efficiently in the best interests of its stockholders and other constituencies.

Table of Contents

B. Board of Directors

    1. Membership
      a. Number. As provided in the Bylaws, there shall be not more that 14 Directors and not less than 8 as the Board may provide by resolution from time to time.
      b. Independent Directors. Not less than three-quarters of the Directors shall be ďindependent DirectorsĒ as defined in this section.
        (1) A Director is not independent unless the Board affirmatively determines that the Director has no material relationship with the Corporation, either directly or as a partner, shareholder, or officer of an organization that has a relationship with the Corporation. The Corporation will identify in its annual meeting proxy statement which Directors are independent and disclose the basis for the determination.
        (2) A Director is not independent if the Director is, or within the last three years has been, an employee of the Corporation or an immediate family member is, or within the last three years has been, an "executive officer" (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934) of the Corporation. A Director who serves as an interim Chairman, Chief Executive Officer (CEO) or other executive officer, however, may be deemed independent immediately following that employment.
        (3) A Director is not independent if the Director or an immediate family member has received from the Corporation, during any twelve-month period within the last three years, more than $100,000 in direct compensation other than Director and committee fees and pension or other forms of deferred compensation for prior service that is not contingent on continued service. Compensation received by the Director for former service as an interim Chairman, CEO, or other executive officer and compensation received by an immediate family member for service as an employee (other than an executive officer) is excluded when determining independence under this subsection.
        (4) A Director is not independent if (a) the Director or an immediate family member is a current partner of the Corporation's internal or external auditor, (b) the Director is a current employee of the Corporation's internal or external auditor, (c) an immediate family member is a current employee of the internal or external auditor and participates in the auditor's audit, assurance, or tax compliance (but not tax planning) practice, or (d) the Director or an immediate family member was within the last three years (but is not currently) a partner or employee of the internal or external auditor and personally worked on the Corporation's audit within that time.
        (5) A Director is not independent if the Director or an immediate family member is, or within the last three years has been, employed as an executive officer of another company where any of the Corporation's current executive officers at the same time serves or served on that company's compensation committee.
        (6) A Director is not independent if the Director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the Corporation for property or services in an amount that, in any of the last three fiscal years, exceeds the greater of $1 million or 2% of the company's consolidated gross revenues.
        (7) The term "immediate family member" includes a Director's spouse, parents, children, siblings, mothers and fathers-in-law, brothers and sisters-in-law, sons and daughters-in-law, and anyone (other than domestic employees) who shares the Director's home.
      c. Eligibility.
        (1) A Director shall not stand for re-election as a Director after attaining the age of 72 years.
        (2) Unless requested by the Corporate Governance Committee to do so, a Director shall not stand for re-election if there is a change in the Directorís employment or principal business association.
        (3) A Director who is a full-time employee of the Corporation may not serve on the board of directors of more than two other publicly held for-profit corporations unless approved by the Board.
      d. Orientation.
        (1) Each newly elected Director who has not served previously on the board of directors of a for-profit corporation listed on the NYSE will be afforded an opportunity to attend, at the Corporationís expense, an orientation course provided by the NYSE when it becomes available.
        (2) Each newly elected Director shall be provided with a copy of the Corporationís Directors Handbook, which includes this Statement, financial information, and other written materials appropriate to inform the Director about the duties and responsibilities of being a Director and the nature of the Corporationís operations and businesses.
        (3) Each newly elected Director shall also be afforded an opportunity (a) to meet with the CEO, the Chief Financial Officer (CFO), and the president of each major business group to discuss the Corporationís structure and operations and (b) to visit the Corporationís major facilities.
      e. Stock Ownership. Within the later of three years of joining the Board or three years of the adoption of this Statement by the Board, a Director is expected to own shares of the Corporationís common stock having a market value of at least $150,000.

    2. Selection of Directors.
      a. Qualifications and Standards. Although there are no specific minimum qualifications that must be met by a candidate to be recommended to the Board nor any specific qualities or skills that the candidate must possess, the following are desirable.
        (1) Integrity. A Director candidate should have proven integrity and a record of substantial achievement.
        (2) Age. A Director candidate should be old enough to exercise mature judgment, but young enough to serve for several years. Ordinarily, the candidate should be between 45 and 60 years of age.
        (3) Experience. Preferably, a candidate should be the active or retired chief executive officer of a corporation that is publicly held and of comparable size. Presidents, chief operating officers, chief financial officers, and other qualified and prominent individuals who have business acumen and whose relevant background, training, and experience can be expected to benefit the Corporation should also be considered.
        (4) Judgment. A candidate should have a reputation for sound business judgment. It is important that a candidate understands the role of the Board and the workings of the Corporation in the current business environment. A candidate should be able objectively to appraise managementís plans, programs, achievements, and shortcomings.
        (5) Character. Candidates must inspire trust and confidence in other Directors so that the Board can discharge its duties smoothly and efficiently.
        (6) Prestige. A candidate should add to the prestige of the Board. This will enhance the Corporation's reputation and make future recruiting easier.
        (7) Commitment. A candidate should be able and willing to devote the required amount of time to the Corporation's affairs, including preparing for and attending meetings of the Board and its committees and attending annual meetings of stockholders.
        (8) No Conflicts. A candidate may not have a conflict of interest with the Corporation. For this purpose, a candidate has a conflict of interest if the candidate has a business relationship that would be required to be disclosed in the Corporation's proxy statement. In addition, it is preferable that the candidate qualify as an independent Director as defined in section B.1.b of this Statement.
        (9) Representation. A candidate must be committed to representing the interests of stockholders generally and not the interests of a particular stockholder or group of stockholders nor the interests of a particular group whose interests are primarily non-economic or involve a social agenda.
      b. Procedure.
        (1) When a vacancy occurs on the Board or when the Board increases the number of Directors, the Corporate Governance Committee will identify potential candidates to fill the vacancy.
        (2) Background information on each candidate will be distributed to the members of the Corporate Governance Committee.
        (3) The Corporate Governance Committee will screen recommended candidates, and, if appropriate, make discreet inquiry to determine the candidate's interest and availability.
        (4) Unless eliminated by the screening, the candidate's name will be reported to the Board and the Board members will be asked for comments.
        (5) One or more members of the Committee will meet with the candidate and determine the candidate's suitability for the Board.
        (6) The approved candidate's name and biographical information will be distributed to the other Directors at or in advance of the meeting preceding the meeting at which the candidate will be proposed for election.
        (7) The full Board will act on the nomination.
        (8) The Committee will consider candidates proposed by one or more substantial, long-term stockholders. Generally, stockholders who individually or as a group have held 5% of the Corporation's common stock for over one year will be considered substantial, long-term stockholders.
        (9) In considering candidates proposed by stockholders, the Committee will apply the qualifications and standards stated in section B.2.a.
    3.Duties and Responsibilities.
      a. General.
        (1) Within limits defined by statute and the charter and bylaws of the Corporation, the Board of Directors shall exercise general powers as the governing body of the Corporation.The Board is the final authority with respect to the overall policies of the Corporation and with respect to the approval of objectives and goals for the Corporation and the evaluation of managementís performance in relation to those policies, objectives, and goals.
        (2) The day-to-day management of the business is delegated to the CEO of the Corporation.
        (3) As trustees of the business, the Directors have a fiduciary responsibility to the Corporationís stockholders.The Directors may also consider the interests of the Corporationís other constituencies such as its employees, customers, and the communities in which the Corporation operates, provided there are rationally related benefits accruing to the Corporationís stockholders.
        (4) Management has the responsibility to provide to the Directors all information necessary or appropriate to enable the Directors to discharge their duties and responsibilities.Directors must be aware, at all times, that the information that is presented to them is confidential pending its release to the public.
      b. Statutory Duties.
        (1) A Director shall perform his or her duties as a Director, including duties as a member of a committee of the Board, (a) in good faith, (b) in a manner that the Director reasonably believes to be in the best interests of the Corporation, and (c) with the care that an ordinarily prudent person in a like position would use under similar circumstances.
        (2) In performing his or her duties, a Director is entitled to rely on any information, opinion, report, or statement, including any financial statement or other financial data, prepared or presented by (a) an officer or employee of the Corporation whom the Director reasonably believes to be reliable and competent in the matters presented, (b) a lawyer, certified public accountant, or other person, as to a matter that the Director reasonably believes to be within the personís professional or expert competence, or (c) a committee of the Board on which the Director does not serve, as to a matter within its designated authority, if the Director reasonably believes the committee merits confidence.A Director is not acting in good faith if the Director has any knowledge concerning the matter in question that would cause the reliance to be unwarranted.
      c. Specific Duties.
        Specific duties include:
        (1) Acquisitions and Mergers. With the advice of the Finance Committee, authorize significant acquisitions and mergers, subject to approval by the stockholders when necessary.
        (2) Budgets. With the advice of the Finance Committee, review and approve annual capital expenditure and charitable contributions budgets.
        (3) Bylaws. With the advice of the Corporate Governance Committee, review and approve changes in the Corporationís Bylaws.
        (4) Committees. With the advice of the Corporate Governance Committee, elect or appoint, define the powers of, and dissolve committees of the Board.
        (5) Dividends. With the advice of the Finance Committee, determine dividend policy and authorize the payment of dividends.
        (6) Employee Benefits. With the advice of the Compensation Committee, approve major compensation plans, including stock option plans and other equity-based plans, and any significant changes to any of these, and, in the case of equity-based plans, submit them to the stockholders for approval if required by the rules of the NYSE.
        (7) Ethical and Professional Standards. With the advice of the Corporate Governance Committee, adopt ethical and professional standards for the Corporation and assure, through continuing review, that Directors, officers, and employees act in accordance with established and accepted ethical and business standards, including compliance with the Corporationís Code of Ethics and Standards of Conduct, a copy of which as amended from time to time is attached to this Statement as Appendix 1, and, with the advice of the Audit Committee, the Code of Ethics for Senior Financial Officers, a copy of which as amended from time to time is attached to this Statement as Appendix 2.
        (8) Financial Transactions. With the advice of the Finance Committee, review and approve financial transactions as provided in the Boardís standing resolution on Approval of Financial Transactions and the Corporationís Short-Term Investment Policy and review and approve registration statements and other documents relating to the public sale of the Corporationís securities.
        (9) Officers. With the advice of the Compensation Committee, elect and, when appropriate, remove the CEO and other principal officers of the Corporation, delegate management responsibility and authority to them, and, through the Compensation Committee, monitor their performance and establish their compensation.
        (10) Stockholders. With the advice of the Corporate Governance Committee, fix the date, time and place of all meetings of stockholders, fix the record date for stockholders entitled to vote at each meeting of stockholders, appoint management proxies and proxy solicitors, and call special meetings as required.
        (11) Audit Committee Funding. Cause the Corporation to provide appropriate funding, as determined by the Audit Committee, for payment of compensation to the Corporation's independent auditor, compensation to any advisors employed by the Audit Committee, and the administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties.
    4. Organization.
      a. Chairman. At the first Board meeting following a meeting of stockholders at which Directors were elected, the Board will elect a Chairman from among its members who shall preside at all meetings of the Board and the stockholders.
      b. Secretary. The Secretary or an assistant secretary of the Corporation will record the proceedings at all meetings of the Board except that, during executive sessions of the Board from which the Secretary is excluded, another person present shall be designated by the Chairman or Presiding Director to act as secretary of the meeting.
      c. Presiding Director. Each chairman of a standing committee who is a non-management Director shall serve in rotation as Presiding Director for a period of one year beginning with the annual meeting of stockholders in the following order: Corporate Governance, Compensation, Audit, and Finance.
    5. Meetings.
      a. Attendance. Each Director has a duty to attend, whenever possible, all meetings of the Board and of each committee of which the Director is a member.
      b. Regular Meetings. The Board will meet, without notice, immediately after each annual meeting of stockholders, and, subject to the notice provisions of the Bylaws, in the months of February, July, October, and December on a day and at a time designated by the CEO.
      c. Special Meetings. Special meetings may be called, subject to the notice provisions of the Bylaws, at any time by the CEO or any two Directors.
      d. Executive Sessions. To allow full and candid discussion among non-management Board members of matters important to the Corporation, the non-management Directors (i.e., Directors who are not officers) shall meet in executive session without management following the regular Board meetings in February, July, and December. (If there are one or more non-management directors who are not also independent directors, the independent directors shall meet in executive session at least once each year.) The Presiding Director shall preside, and, in the absence of the Presiding Director, the non-management Directors present will choose a Presiding Director pro tem to preside over the executive session. Directions as to how interested parties may make their concerns known to the non-management Directors as a group will be included in the Corporation's annual meeting proxy statement.
      e. Meeting Materials. Agendas and meeting materials will be distributed in advance of Board and committee meetings, and each Director has a duty to review the materials prior to the meetings.
    6. Committees.
      a. General.
        (1) The Board, at its discretion, may appoint or elect from among its members committees of one or more Directors to deal with particular areas of the Corporationís activities and interests.All members of committees serve at the pleasure of the Board and may be removed by the Board at any time.
        (2) To the extent practicable, any matter requiring action by the Board shall first be presented to the appropriate committee for consideration and recommendation.
        (3) To the extent practicable, the CEO shall attend each committee meeting unless the committee is meeting in executive session.
        (4) The CEO shall designate an officer, employee, or agent of the Corporation to provide staff support to each committee.
        (5) Charters of the standing committees will be published from time to time as required by rules of the Securities and Exchange Commission (SEC) or the NYSE.
      b. Standing Committees. There are five standing committees of the Board:
        (1) Executive Committee,
        (2) Audit Committee,
        (3) Compensation Committee,
        (4) Corporate Governance Committee, and
        (5) Finance Committee.
      c. Special Committees. Special committees may be appointed from time to time by the Board to act upon such matters as the Board may commit to them.
      d. Membership.
        (1) The members of each standing committee are appointed (or, in the case of the Executive Committee, elected) annually by the Board at its first meeting following the annual meeting of stockholders.
        (2) A majority of each standing committee (and all of the members of the Audit Committee, the Compensation Committee, and the Corporate Governance Committee) shall be independent Directors as defined in section B.1.b of this Statement.
        (3) The chairman of each committee is designated by the Board at the time the committee is elected or appointed.
        (4) Special committees may be created by resolution of the Board or appointed by the Chairman of the Board. They shall consist of the number of Directors that the resolution creating the committee or the Chairman of the Board in creating the committee shall provide.
        (5) Under normal circumstances, each Director shall serve on at least one standing committee, and no Director shall serve as Chairman of more than one standing committee.
        (6) Consideration should be given to rotating committee assignments at approximately five-year intervals, but the Board recognizes that there may be reasons to retain a particular Director on a particular committee for a longer period.
      e. Committee Service Compensation. In addition to the annual retainer for serving as a Director, each Director who is not a full‑time employee of the Corporation receives:
        (1) An annual retainer of $10,000 for service on the Audit Committee and $10,000 for service as chairman of a standing committee other than the Executive Committee, prorated as of the date of appointment if the appointment is made at other than an annual meeting of the Board; and
        (2) Reimbursement for reasonable expenses incurred in attending committee meetings.
      f. Operation
      Each Committee:
        (1) Shall appoint a secretary who may, but need not, be a member of the Committee;
        (2) Shall keep minutes of its proceedings;
        (3) May determine its own procedures;
        (4) May call upon the Corporationís officers, employees, counsel, auditors, and consultants and may retain at the Corporationís expense other professional advisers and consultants as it may choose;
        (5) May appoint subcommittees of its members to perform particular functions on behalf of the Committee; and
        (6) May meet by telephone conference call or similar communications equipment if all persons participating in the meeting can hear each other at the same time.
    7. Director Compensation.
      a. General. Compensation of Directors is authorized from time to time by resolution of the Board with the advice of the Corporate Governance Committee.Directors who are full-time employees serve without additional compensation. Compensation, including compensation for service on a committee, may be deferred as provided in The Black & Decker Non-Employee Directors Stock Plan.
      b. Annual Retainer. Directors who are not full-time employees of the Corporation receive, as of the date of election or re-election to the Board, an annual retainer of $150,000 payable one-half in shares of stock under the Non-Employee Directors Stock Plan and the balance in cash.A Director may elect to receive all or any part of the cash portion in shares of stock. A Director who elects to receive all or any part of the cash portion in shares of stock and defer receiving the shares under The Black & Decker Corporation Deferred Compensation Plan for Non-Employee Directors shall be credited with shares having a Fair Market Value (as defined in The Black & Decker Non-Employee Directors Stock Plan) equal to 120% of the amount of cash deferred. If a person is elected a Director other than at an annual meeting of stockholders, the compensation will be prorated as of the date when the Director was elected.
      c. Expenses. The Corporation will reimburse Directors for travel on behalf of the Corporation, including travel to attend meetings of the Board or Board committees, and travel-related expenses.
      d. Insurance. The Corporation provides $100,000 of term life insurance for each non-employee Director.The Corporation also provides $200,000 of accident insurance coverage during each day that a non-employee Director is traveling in connection with Corporate business.
    8. Access to Management and Independent Advisors. The Board and each Director shall have direct access at all times to members of management and, preferably through the Audit Committee, to the Corporationís independent auditor.The Board may retain at the Corporationís expense such independent consultants and advisors as it may choose.
    9. Annual Performance Assessment. Under the oversight of the Corporate Governance Committee, the Board shall conduct annually a self-evaluation to determine whether it and its committees are functioning effectively and take any action that it deems appropriate to improve its ability to oversee and guide the Corporation.
    10. Communications from Stockholders. In addition to the procedures provided for any interested party to communicate with the Presiding Director (section B.4.c) and the non-management Directors as a group (section B.5.d), stockholders also may communicate with individual Directors or the whole Board by sending communications, marked to show that they are stockholder communications, in care of the Corporate Secretary. If addressed to individual Directors, the communications will be forwarded, unopened, to those Directors, and if addressed to the whole Board, will be forwarded, unopened, to the Chairman of the Corporate Governance Committee for review and appropriate dissemination.
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C. Charters of Standing Committees.

    1. Executive Committee Charter.
      a. Members. The Executive Committee is composed of not less than five members elected annually by the Board of whom the Chairman shall be one. A majority of the members shall be independent Directors as defined in section B.1.b of this Statement. Normally, the chairman of each of the other standing committees will be elected a member of the Executive Committee. The Bylaws provide that in the absence of any member of the Executive Committee, the members who are present at any meeting, whether or not they constitute a quorum, may appoint a Director who is present to act in the place of the absent member.
      b. Functions. During the intervals between the meetings of the Board, the Executive Committee may exercise all of the powers of the Board in the management and direction of the affairs of the Corporation subject to (1) specific directions of the Board and (2) the Maryland General Corporation Law, which provides that such a committee may not (a) declare dividends or other distributions on stock, (b) issue stock other than pursuant to general authority granted by resolution of the Board, (c) recommend to the stockholders any action requiring stockholders' approval, (d) amend the Bylaws, or (e) approve any merger or share exchange that does not require stockholder approval.The Executive Committee will also act in a general and advisory capacity to management.
      c. Staff Support. General Counsel; Corporate Secretary.
    2.Audit Committee Charter.
      a. Members. The Audit Committee is composed of not less than three members, appointed annually by the Board, each of whom (1) is an independent Director as defined in section B.1.b of this Statement, (2) meets the requirements of Section 303A(2) of the NYSE Listed Company Manual and Rule 10A-3(b)(1) of the SEC, (3) except fees for service as a Director or as a member of a committee of the Board, accepts no other consulting, advisory, or other compensatory fee from the Corporation, and (4) is not an affiliated person of the Corporation or any subsidiary of the Corporation. All members shall be able to read and understand fundamental financial statements, including the Corporation's balance sheet, income statement, and cash flow statement. In addition, at least one member shall qualify as an "audit committee financial expert" as defined by the SEC. A member may not serve simultaneously on the audit committee of more than three public companies unless the Board determines that the additional service will not impair the member's ability to serve effectively on the Corporation's Audit Committee and discloses the determination in the Corporation's annual meeting proxy statement.
      b. Purpose. The Audit Committee, among other things, assists the Board in overseeing the integrity of the Corporation's financial statements, the Corporation's compliance with legal and regulatory requirements, the independent auditor's qualifications and independence, and the performance of the Corporation's internal auditors and independent auditor. The Committee is directly responsible for the appointment, compensation, retention, and oversight of the work of the independent auditor, who shall report directly to the Committee. The Committee also prepares a report to be included in the Corporation's annual meeting proxy statement as required by the rules of the SEC.
      c. Functions. The Audit Committee will:
        (1) Retain and terminate, on its sole authority, the Corporationís independent auditor and approve all audit engagements and the scope, fees, and terms of each engagement.
        (2) Approve in advance any non-audit engagements of the independent auditor permitted by Section 201 of the Sarbanes-Oxley Act of 2002 and assure that the approval is disclosed in the Corporationís periodic reports as required by law.
        (3) At least annually, obtain and review a report by the independent auditor describing the auditor's internal quality-control procedures, any material issues raised by the most recent internal quality-control review or peer review of the auditor or by any inquiry or investigation by governmental or professional authorities within the preceding five years with respect to one or more independent audits carried out by the auditor, and any steps taken to deal with any such issues, and (to assess the auditor's independence) all relationships between the independent auditor and the Corporation.
        (4) Require the independent auditor to provide a written statement of all relationships between the auditors and the Corporation consistent with Independence Standards Board Standard No. 1.
        (5) Evaluate the independent auditorís qualifications, performance, and independence, including review and evaluation of the lead partner of the independent auditor, taking into account the opinions of management and the Corporationís internal auditors, and assure the rotation of the lead audit partner, the reviewing audit partner, and other audit personnel as required by law.
        (6) Receive and review reports of the independent auditor regarding critical accounting policies and practices to be used, all material alternative treatments of financial information within GAAP that have been discussed with management, the ramifications of using the alternative disclosures and treatments and the treatment preferred by the independent auditor, and other material written communications between the independent auditor and management, including any management representation letter, report on observations and recommendations on internal controls, schedule of unadjusted differences, and a listing of adjustments and reclassifications not recorded.
        (7) Present to the Board the Audit Committeeís conclusions with respect to the independent auditor.
        (8) Meet to review and discuss the Corporation's annual audited financial statements and quarterly financial statements, including reviewing the Corporation's specific disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations," with management and the independent auditor.
        (9) Review and discuss with management the financial statements in the Corporationís Annual Report on Form 10-K, discuss with the independent auditor the matters required to be discussed by Statement on Auditing Standards No. 61, and based on the review and discussion, recommend to the Board that the audited financial statements be included in the Annual Report on Form 10-K.
        (10) Discuss earnings press releases and the general types of information to be provided to securities analysts and rating agencies.The discussion of earnings press releases may be conducted without a meeting of the Committee by the Chairman or the Chairmanís designee and any available members.
        (11) Discuss policies with respect to risk assessment and risk management, including guidelines and policies that govern the process by which risk assessment and risk management is undertaken and the steps management has taken to monitor and control the exposures.
        (12) Periodically, meet separately with the CFO, the General Counsel, the Controller, the General Auditor, and the independent auditor.
        (13) Review regularly with the independent auditor any audit problems or difficulties, including any restrictions on the scope of the independent auditorís activities or access to requested information, any significant disagreements with management and managementís response.
        (14) Set clear hiring policies for employees and former employees of the independent auditor.
        (15) Establish procedures for (a) receiving, retaining, and handling complaints received by the Corporation regarding accounting, internal accounting controls, or auditing matters, and (b) the confidential, anonymous submission by employees of the Corporation of concerns regarding questionable accounting or auditing matters.
        (16) Serve as a channel of communication between the Board and the independent auditor.
        (17) At least annually, meet with the General Auditor to review the internal audit organization, the adequacy of resources committed to the function, the adequacy of the system of internal controls, procedures, and programs, the results of activities, and the responsibilities, budget, and staffing of the Corporationís internal audit function.
        (18) Review significant accounting principles and financial statement presentations, including any material changes in the Corporationís selection or application of accounting principles.Review significant judgments made in connection with the preparation of the financial statements, including any material exposures and related reserves and any off-balance sheet structures.
        (19) Assess compliance of the Corporationís CEO, CFO and Controller with the Code of Ethics for Senior Financial Officers set out in Appendix 2 to this Statement, report material violations to the Board, and recommend to the Board appropriate action.
        (20) Review the expenses of the executive officers.
        (21) Report the Audit Committeeís charter, charter amendments, and activities in the Corporationís annual meeting proxy statement as required by the rules of the SEC.
        (22) Review the certificates of the CEO and the CFO relating to the annual and quarterly reports and monitor the establishment, maintenance, and evaluation by the CEO and the CFO of the disclosure controls and procedures and internal control over financial reporting required by the SEC.
        (23) Quarterly, receive a report from the General Auditor regarding any transactions that are out of the ordinary course of business between Directors or executive officers and the Corporation.
        (24) Annually, adopt a schedule for discharge of the Committeeís duties and responsibilities.
        (25) Review compliance with the provisions of the Corporationís Code of Ethics and Standards of Conduct (Appendix 1) dealing with conflicts of interest, improper payments, and secret accounts.
        (26) As appropriate and at the expense of the Corporation, retain and obtain advice and assistance from outside legal, accounting, or other advisors without seeking Board approval.
        (27) Annually, review and reassess the adequacy of the charter of the Audit Committee.
        (28) Annually, conduct an evaluation of the Audit Committeeís performance.
        (29) Report regularly to the Board.
      d. Staff Support. CFO; Controller; General Counsel; General Auditor.
    3. Compensation Committee Charter.
      a. Members. The Compensation Committee is composed of not less than three members appointed annually by the Board.All members shall be independent directors as defined in section B.1.b of this Statement.
      b. Purpose. The Compensation Committee, among other things, assists the Board in matters relating to executive compensation, establishes goals for the award of incentive or performance-based compensation, administers the Corporationís stock option and similar plans, and monitors the performance of the executive officers.
      c. Functions.
        (1) Annually, review and approve goals and objectives relevant to compensation of the CEO, evaluate the CEO's performance in light of those goals and objectives, and recommend to the independent members of the Board the CEO's compensation level based on that evaluation.
        (2) On a continuing basis, review the Corporationís organizational structure.
        (3) On a continuing basis, maintain plans for succession in the officer ranks to cover losses both by normal attrition and by premature death, incapacity, or retirement.
        (4) Review and recommend to the Board the election and removal of elected corporate officers.
        (5) Review annually the job objectives and job performance of the executive officers.
        (6) In addition to (1) above, review and recommend to the Board salaries and benefits for the executive officers.
        (7) Review and make recommendations to the Board with respect to incentive compensation plans and equity-based compensation plans.
        (8) Administer all short-term and long-term incentive compensation plans and all equity-based plans, including acting as the stock option committee under all of the Corporationís stock option plans.
        (9) Monitor compliance with the Corporationís policy regarding stock ownership by executives.
        (10) If a compensation consultant is to assist in the evaluation of CEO or other senior executive compensation, retain and terminate the consulting firm and approve the firmís fees and other retention terms, all on the Compensation Committeeís sole authority.
        (11) Produce a report on executive officer compensation for inclusion in the Corporation's annual meeting proxy statement in accordance with applicable rules and regulations.
        (12) Annually, conduct an evaluation of the Compensation Committeeís performance.
        (13) Report all significant actions to the Board at the next regular Board meeting.
      d. Staff Support. Senior Vice President--Human Resources; General Counsel.
    4. Corporate Governance Committee Charter.
      a. Members. The Corporate Governance Committee is composed of not less than three members appointed annually by the Board.All members shall be independent directors as defined in section B.1.b of this Statement.
      b. Purpose. The Corporate Governance Committee, among other things, identifies individuals qualified to become Directors, recommends to the Board a slate of Director-nominees for the next annual meeting of stockholders, recommends members of the standing committees, and develops and recommends to the Board corporate governance principles.
      c. Functions.
        (1) Develop and recommend to the Board a set of corporate governance principles to be set forth in this Statement, review this Statement on a continuing basis, and recommend to the Board appropriate changes in this Statement.
        (2) Propose to the Board at its December meeting a slate of Directors for submission to the stockholders at their annual meeting.
        (3) Monitor Directors for independence as defined in section B.1.b. of this Statement and report to the Board at its February meeting any relationships that require a determination by the Board of materiality for reporting purposes.
        (4) Handle problems regarding Directors who because of physical or mental condition or for other reasons become unfit to serve.
        (5) Review and recommend to the Board any appropriate changes in the Corporationís criteria for selecting new directors.
        (6) Consistent with the Qualifications and Standards stated in section B.2.a, recommend candidates for election to the Board to fill vacancies and participate in interviewing prospective candidates. The Committee shall have sole authority to retain, terminate, and approve the compensation of search firms to assist it in performing this function.
        (7) Review for compliance with Section 3 of Article II of the Bylaws the nominations of director candidates made by stockholders and determine the eligibility of each proposed nominee.
        (8) Nominate annually members of the standing committees for presentation to the Board at its annual meeting and, on a continuing basis, recommend changes as appropriate.
        (9) Annually, review the Corporationís Code of Ethics and Standards of Conduct and compliance with the Code.
        (10) Review and recommend changes in compensation and benefits for service on the Board and committees of the Board.
        (11) Monitor compliance with the Corporationís policy regarding stock ownership by Directors.
        (12) Oversee the annual self-evaluation of the Board and the evaluation of management.
        (13) Conduct an annual evaluation of the Corporate Governance Committeeís performance.
        (14) Report all significant actions to the Board at the next regular Board meeting.
      d. Staff Support. General Counsel; Corporate Secretary.
    5. Finance Committee Charter.
      a. Members. The Finance Committee is composed of not less than three members, appointed annually by the Board.A majority of the members shall be independent Directors as defined in section B.1.b of this Statement.
      b. Purpose. The Finance Committee, among other things, monitors generally the financial performance of the Corporation, recommends dividends, reviews and recommends offerings of the Corporationís securities, and reviews the Corporationís investments.
      c. Functions.
        (1) Review the Corporationís financial policies and procedures.
        (2) Review operating and financial results.
        (3) Give financial advice to management.
        (4) Consider and make recommendations to the Board regarding corporate financing and the issuance and sale of the Corporation's securities.
        (5) Review annual operating budgets and review and recommend to the Board annual capital expenditure budgets and charitable contributions budgets.
        (6) Review purchases of fixed assets (including capital leases) and sales of fixed assets (including land and buildings) and act upon them in accordance with the Boardís standing resolution on Approval of Financial Transactions.
        (7) Consider and make recommendations to the Board on dividends.
        (8) Review and act upon borrowings and prepayment of borrowings in accordance with the Boardís standing resolution on Approval of Financial Transactions.
        (9) Review mergers, acquisitions, divestitures, and similar transactions in accordance with the Boardís standing resolution on Approval of Financial Transactions.
        (10) Annually review and ratify all investments (defined as total assets less inter-company accounts receivable and non-guaranteed third party accounts payable) in "high risk" countries, and review and recommend to the Board investments in "high risk" countries in accordance with the Boardís standing resolution on Approval of Financial Transactions.
        (11) Oversee generally the provisions of and operations of the various pension plans and similar benefit programs and operating pension committees of the Corporation and its subsidiaries.Specifically:
          (a) Periodically review the investment policies and management of major pension funds.
          (b) Annually, review funding levels of non‑insured defined benefit plans.
      d. Staff Support. CFO; Treasurer.
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D. Officers.

    1. Evaluation of the CEO. With the advice of the Compensation Committee, the Board will conduct annually, in executive session, a formal evaluation of the CEO.The review will be based on the accomplishment of goals and objectives established by the Compensation Committee.The evaluation will be communicated to the CEO by the Chairman of the Compensation Committee.
    2. Management Development and Succession Planning. With the advice of the Compensation Committee, the Board will review annually the Corporationís plans for management development and succession planning for key executive positions.
    3.Communications with Media and Others. The CEO is responsible for all communications with the media, the financial community, and similar external entities pertaining to the affairs of the Corporation.Directors should refer all inquiries from such entities to the CEO.
    4.Stock Ownership by Executives.
      a. Policy. The Corporation encourages stock ownership by its principal elected corporate officers to more closely align their interests with those of the Corporationís stockholders.
      b. Goal. Each of the following officers is expected to own stock of the Corporation having a market value equal to the multiple of his or her annual salary as follows:
        (1) CEO: 5
        (2) Executive, Senior and Group Vice Presidents: 3
        (3) Vice Presidents: 2
      c. Intermediate Goal. Until the applicable goal is achieved, each officer is expected to retain 50% of the ďnet sharesĒ received under the Corporationís stock-based compensation plans.ďNet sharesĒ are the shares remaining after deducting shares for the payment of taxes and the exercise price of stock options.
      d. Exception. This policy does not apply to officers who have attained 60 years of age.
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E. Business Practices.

    1. Code of Ethics and Standards of Conduct.
    The Board has adopted a Code of Ethics and Standards of Conduct, a copy of which, as amended from time to time, is attached as Appendix 1.
    2. Code of Ethics for Senior Financial Officers.
    The Board has adopted a Code of Ethics for Senior Financial Officers, a copy of which, as amended from time to time, is attached as Appendix 2.
Adopted by the Board of Directors February 13, 2003.
Amended February 12, 2004
Amended October 21, 2004
Amended December 9, 2004
Amended February 10, 2005



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APPENDIX 1

Code of Ethics and Standards of Conduct


INTRODUCTION


This Code of Ethics and Standards of Conduct has been adopted by the Board of Directors of the Corporation to assure that the Corporation adheres to ethical standards and obeys all applicable laws and that its employees, officers and directors clearly understand what is required of them in that regard. The Code does not address every ethical or legal issue that an employee, officer or director may face. The Code is not a substitute for the exercise of good judgment by the Corporation's employees, officers and directors.

The Corporation may from time to time adopt more detailed policies and procedures with regard to certain areas covered by the Code and other matters not mentioned in the Code. Compliance with the Code and compliance with the Corporation's policies and procedures are a condition of employment.

The Corporation's General Counsel is responsible for the implementation and administration of the Code. Each manager is responsible for seeing that all employees under his or her supervision are thoroughly familiar with the Code and are applying it consistently in all of their business dealings. No employee has the authority to violate any of the Code's provisions or to direct or authorize others to do so.

The Code applies to The Black & Decker Corporation and to all subsidiaries and business entities, domestic and foreign, over which the Corporation has control. In business affiliations in which the Corporation does not have control, representatives of the Corporation shall use their influence to achieve adherence to the spirit and content of the Code. The word "employees" in the Basic Principles and Practices includes officers, and, when they are acting on behalf of the Corporation, directors.


BASIC PRINCIPLES AND PRACTICES


ACCURATE BUSINESS RECORDS

The integrity and completeness of record-keeping is not only the Corporation's policy, it is also mandated by law. The Corporation is required to keep books, records, and accounts that accurately and fairly reflect all transactions and to maintain an effective worldwide system of internal controls. The improper alteration, destruction, concealment or falsification of records or documents may result in criminal penalties.

Proper recording of all transactions is essential to the Corporation's control of its affairs and the accuracy of its financial reporting. To maintain the integrity of the accounting records, all entries in the Corporation's books and records must be prepared carefully and honestly and must be supported by adequate documentation to provide a complete, accurate, and auditable record. All employees have a responsibility to assure that their work is complete and accurate. No false or misleading entry may be made for any reason, and no employee may assist any other person in making a false or misleading entry.

Employees must provide accurate and complete information to the Corporation's officers, legal counsel, internal auditors, independent auditors, and any other person authorized to receive the information.

Secret activities invite misconduct, while full disclosure reinforces responsibility and acts as a powerful deterrent to wrongdoing. Therefore, undisclosed or unrecorded transactions are not allowed for any purpose. Any employee having information or knowledge of any undisclosed or unrecorded transaction or the falsification of records should report it promptly to the Corporation's Vice President-General Auditor, General Counsel, or Chairman of the Audit Committee of the Board of Directors.

ANTITRUST COMPLIANCE

It is the Corporation's policy to comply with the antitrust laws of those nations in which it manufactures products or in which its products and services are sold. Generally, these laws prohibit practices that might unreasonably restrict competition. Agreements with competitors regarding such subjects as price fixing, market division, and output limitations are generally prohibited by these laws and criminal sanctions in the form of fines and imprisonment are frequently imposed for violations.

COMPLIANCE WITH LAWS

It is the Corporation's policy to comply with all laws, rules and regulations that are applicable to its business, both in the United States and in other countries. To that end, the use of the Corporation's funds or assets for an unlawful or improper purpose is strictly prohibited. Where applicable laws, rules and regulations are ambiguous, management shall obtain legal advice from the General Counsel to clarify their meaning and assure compliance.

CONFIDENTIALITY

Employees should maintain the confidentiality of information entrusted to them by the Corporation or its customers, except when disclosure is authorized or is legally mandated. Confidential information is all non-public information about the Corporation and its business. All employees must be careful not to disclose non-public information to unauthorized persons, either within or outside of the Corporation, and must exercise care to protect the confidentiality of such information received from another party. If employees are unsure whether information may be disclosed, they should ask their manager or seek advice from the General Counsel. The unauthorized disclosure of confidential information will be considered a serious violation of the Code and may subject the violator to dismissal.

CONFLICTS OF INTEREST

While the Corporation respects the privacy of its employees in the conduct of their personal affairs, it insists that they fully discharge their employment obligations to the Corporation. Employees should avoid any activity in which their personal interests may come into conflict, or may appear to conflict, with the interests of the Corporation in its relations with current or prospective suppliers, customers, or competitors. Employees must report actual or potential conflicts of interest to the General Counsel.

Two factors that will be considered when determining whether a conflict of interest exists are: (1) whether the employee is or could be in a position to influence the Corporation's relationship with the competitor, supplier, or customer; and (2) whether the employee's judgment could be affected, or could appear to be affected, as it relates to the competitor, supplier, or customer because of the significance of the employee's personal interest. Without limiting the general scope of this policy, the following relationships and courses of conduct will be considered to involve a conflict of interest unless in special circumstances they are specifically approved and waived by the Corporation:

  • Concurrent employment by the Corporation and by any other firm or person if the employment encroaches materially on time or attention that should be devoted to the Corporation's affairs.
  • Concurrent employment of employees by the Corporation and by a current or potential competitor, supplier, or customer of the Corporation.
  • Holding by an employee or immediate relatives of an employee of a significant financial interest in any current or potential competitor, supplier, or customer of the Corporation. The term "financial interest" refers to any form of ownership or amount of ownership. Generally, an employee's financial interest will not be considered "significant" if the employee and the employee's immediate relatives own less than 1% of a publicly held company.
  • Acceptance by an employee or an immediate relative of an employee of membership on the board of directors of a current or potential competitor, supplier, or customer of the Corporation.
  • Acting as a consultant or advisor to a current or potential competitor of the Corporation.
  • Lending money to, guaranteeing debts of, or borrowing money from a current or potential competitor, supplier or customer of the Corporation by or for an employee or an immediate relative of an employee. The borrowing of money from a financial institution that provides services to the Corporation is not prohibited if the loan is of a type generally made available by the financial institution to all, or a specific group, of the Corporation's employees.
  • Participation by an employee in any charitable organization is encouraged except where the employee may be expected to divulge privileged or confidential information or trade secrets of the Corporation or take any other action that may subvert the Corporation's interest, reputation, or goodwill or where the participation encroaches materially on time or attention that should be devoted to the Corporation's affairs.
CORPORATE OPPORTUNITY

Employees must not take for themselves personally opportunities that could reasonably be available to the Corporation. An employee is prohibited from directly or indirectly acquiring rights to any property that the employee knows the Corporation may also be interested in acquiring. Employees should advance the legitimate interests of the Corporation when the opportunity to do so arises.


EMPLOYMENT MATTERS
  • Discrimination and Harassment. While employees and applicants for employment must be qualified and meet the job requirements established by the Corporation, it is the Corporation's policy to ensure that no employee or applicant for employment is discriminated against in recruitment, hiring, training, or promotion because of age, race, color, religion, sex, national origin, handicap, disability, marital status, or veteran status. It is also the policy of the Corporation to provide a work place free of harassment based on these factors. A violation of these policies may also be a violation of applicable law that exposes both the Corporation and the guilty individual to liability. Violations may be reported to the Corporation's Senior Vice President- Human Resources.
  • In General. It is the policy of the Corporation to comply with applicable employment laws, including those governing working conditions, wages, hours, benefits, and minimum age for employment, wherever it conducts business. The use of prison, forced, or compulsory labor is not permitted. Employees have the right to join any legal organization for the purpose of collective bargaining or to refrain from joining any such organization, and employees will not be penalized for exercising this right. Violations may be reported to the Corporation's Senior Vice President-Human Resources.

ENVIRONMENTAL MATTERS

It is the policy of the Corporation to comply with all applicable laws and regulations for the protection of the environment and the conservation of natural resources. The Corporation has established the Statement of Authority-Environmental Affairs (File Code 340-01-0001) for its worldwide operations that places responsibility on every business unit for compliance with applicable laws of the country in which it is located, and the Corporation expects all of its employees to abide by established environmental policies and procedures. Violations may be reported to the Corporation's Vice President- Environmental Affairs.

FAIR DEALING

When interacting with the Corporation's employees, competitors, suppliers, or customers, each employee should strive to act with integrity and honesty and avoid taking advantage of anyone through any unfair-dealing practice.

GIFTS, GRATUITIES, AND ENTERTAINMENT

Receiving business gifts, including the acceptance of meals and transportation, of nominal value is permissible where customary. Receiving cash or gifts of significant value is strictly prohibited. Customary business entertainment, including meals or transportation, is proper unless the value, cost, or frequency of the business entertainment is such that it could be interpreted as affecting an otherwise objective business decision. When determining if a gift could be interpreted as affecting an employee's otherwise objective business decision, the position of the employee and whether the employee is or could be in a position to influence the Corporation's relationship with the competitor, supplier, or customer will be taken into account.

Business-related social contacts can be in the best interest of the Corporation when properly conducted on a limited basis. Employees should make every effort to ensure that there is not the slightest reason for a third party to view these contacts as improper.

IMPROPER PAYMENTS

  • Business. No payment may be made by or on behalf of the Corporation, directly or indirectly, to officers, agents, or employees of customers, suppliers, or competitors of the Corporation. Payment includes unearned commissions or refunds, the donation or loan of the Corporation's property or services of the Corporation's personnel, the incurring or paying of expenses on behalf of another, and the reimbursing of officers, employees, or agents of the Corporation for payments made by them on the Corporation's behalf. Payment does not include (1) any incentive program that is approved by a customer or supplier and is consistent with industry practice, (2) a rebate or discount on the Corporation's products offered to all of the employees, or a specific group of employees, of a customer or supplier, (3) authorized and reasonable entertainment of customers, potential customers or others involved with the Corporation's business in a manner appropriate to the business relationship and the discussion of business matters, or (4) gifts of sales promotion items. While these transactions are not prohibited by this policy, they must be accurately disclosed in the Corporation's books of account.
  • Government. No payment may be made by or on behalf of the Corporation either directly or indirectly to government officials, political candidates, or political parties. Some of these payments are prohibited by law, and criminal sanctions in the form of fines and imprisonment are frequently imposed for violations. Payments include, but are not limited to, kickbacks, gratuities, payoffs, bribes, or the payment of anything of value to government officials, political parties, or candidates. Where the local custom requires, payment of small gratuities may be made to minor governmental functionaries to secure the routine processing of paperwork (for example, gratuities to minor customs officials for processing import documents) provided that the payments (1) are not either individually or in the aggregate significant in amount, (2) are fully disclosed in the Corporation's records and (3) are approved by the manager of the local operation. This policy does not affect the right of employees, acting in an individual capacity and not as representatives of the Corporation, to support political parties or candidates of their choice.
Strict adherence to this policy is required. It is the responsibility of management at all levels to enforce this policy and of all employees to report violations to, or, in doubtful cases, to seek advice from, their superiors or from the General Counsel's office.

INSIDER TRADING

Employees may not trade in the Corporation's securities or the securities of other companies, including customers, suppliers, and others, on the basis of material non-public information. Information is material if it may affect an investor's decision to buy, sell or hold securities of a company. The use of material non-public information, regardless of how the information was obtained, to buy or sell the Corporation's stock, or to advise others to do so, could have serious legal consequences.

INTERNATIONAL BOYCOTTS

Employees may not engage in or support a restrictive trade practice or boycott by any foreign country against any country, person, firm, or corporation. Examples of prohibited conduct include supplying information regarding the race, religion, sex or national origin of a person; refusing to do business with a boycotted firm or country; or acting on any document that contains boycott language. The law requires that solicitations to support such restrictive trade practices or boycotts be reported to the United States government. Consequently, employees should immediately report any of these solicitations to the General Counsel.

OCCUPATIONAL SAFETY

It is the policy of the Corporation to provide its employees with a place of employment that is free from recognized hazards, to comply with all applicable safety laws and regulations, and to reduce the frequency, severity, and costs of lost time occurrences at its operations worldwide. The Corporation expects all of its employees to abide by established safety procedures. The Corporation has established the Safety and Industrial Hygiene Statement of Authority (File Code 340-02-0001) for its worldwide operations that places responsibility on each business unit for developing, administering, and complying with its own safety and industrial hygiene program, tailored to the specific needs of its operations, the applicable laws of the country in which it is located, and the Corporation's policies and guidelines. Violations may be reported to the Corporation's Vice President- Environmental Affairs.

PROTECTION AND PROPER USE OF CORPORATE PROPERTY

Employees should protect the Corporation's assets and ensure their efficient use. Theft of the Corporation's assets will not be tolerated. The unauthorized personal use of any of the Corporation's property is strictly prohibited.


IMPLEMENTATION OF THE CODE


Each manager is responsible for distribution of the Code to appropriate personnel within the manager's function or organization and for providing knowledge, education, and understanding of its importance and meaning. Each employee must acknowledge in writing receipt of the Code. Employees violating the Code will be subject to disciplinary action, possibly including dismissal.

Employees may be required periodically to certify, in writing, compliance with the Code or to describe any deviations known to them.


REPORTING VIOLATIONS OF THE CODE


An employee who becomes aware of a violation of the Code or believes that a violation may take place in the future must report the matter. Ordinarily, the report may be made to the employee's immediate supervisor who, in turn, must report it to the Corporation's General Counsel. The employee also may bring the matter to the attention of any person identified in the text of the Code or as described in "Reporting Violations of the Code of Ethics and Standards of Conduct" appearing at the end of the Code. To ensure that a reporting employee is protected from reprisal, a request for anonymity will be respected to the extent that it does not result in the violation of the rights of another employee. A person making a good-faith report of a possible violation of the Code will not be subject to retaliation. Any attempt at reprisal against the reporting employee will be punished severely. In addition, it is a Federal offense to retaliate against any person who provides a law enforcement officer with any truthful information relating to the commission or possible commission of a Federal offense.


WAIVER


If an employee believes that a waiver of the Code is necessary or appropriate, including, but not limited to any potential or actual conflict of interest, or any waiver of the Corporation's policies or procedures, a request for a waiver and the reasons for the request must be submitted in writing to the General Counsel of the Corporation. An officer or director must submit the request for a waiver to the Chairman of the Corporate Governance Committee of the Board. Any waiver of the Code for executive officers and directors will be disclosed promptly to the Corporation's stockholders.


Approved by the Board of Directors February 13, 2003.



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THE BLACK & DECKER CORPORATION

Reporting Violations of the Code of Ethics and Standards of Conduct

If you wish to remain anonymous, you may call the Black & Decker Ethics Hotline, staffed by The Network, an independent organization operating 24 hours a day, 7 days a week.

  • Within the United States, call toll free 1-888-673-9268
  • Outside the United States, call collect 001-770-613-6365
You may also call the following Black & Decker Officers:

General Counsel:
Charles E. Fenton
Senior Vice President
(410) 716-3918
General Auditor:
Steven E. Howarth
Vice President
(410) 716-3419
Human Resources:
Paul F. McBride
Senior Vice President
(410) 716-7606







APPENDIX 2

Code of Ethics for Senior Financial Officers


Introduction.

This Code of Ethics for Senior Financial Officers has been adopted by the Board of Directors of The Black & Decker Corporation to promote honest and ethical conduct, proper disclosure of financial information in the Corporation's periodic reports, and compliance with applicable laws, rules, and regulations by the Corporation's senior officers who have financial responsibilities.

Applicability.

As used in this Code, the term Senior Financial Officer means the Corporation's Chief Executive Officer, Chief Financial Officer and Controller.

Principles and Practices.

    In performing his or her duties, each of the Senior Financial Officers must:
    (1) maintain high standards of honest and ethical conduct and avoid any actual or apparent conflict of interest as defined in the Corporation's Code of Ethics and Standards of Conduct;
    (2) report to the Audit Committee of the Board of Directors any conflict of interest that may arise and any material transaction or relationship that reasonably could be expected to give rise to a conflict;
    (3) provide, or cause to be provided, full, fair, accurate, timely, and understandable disclosure in reports and documents that the Corporation files with or submits to the Securities and Exchange Commission and in other public communications;
    (4) comply and take all reasonable actions to cause others to comply with applicable governmental laws, rules, and regulations; and
    (5) promptly report violations of this Code to the Audit Committee.
    Senior Financial Officers must also comply with the Code of Ethics and Standards of Conduct applicable to the Corporation's Directors, officers, and employees generally.
Waiver.

Any request for a waiver of any provision of this Code must be in writing and addressed to the Audit Committee. Any waiver of this Code will be disclosed promptly on Form 8-K or any other means approved by the Securities and Exchange Commission.

Compliance and Accountability.

The Audit Committee will assess compliance with this Code, report material violations to the Board of Directors, and recommend to the Board appropriate action.


Approved by the Board of Directors February 13, 2003.


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