CONTRIBUTING EMPLOYEE OWNERSHIP PLAN

(a)   the sum of (i) the fair market value of any Matching Contributions (and Performance Matching Contributions, and qualified non-elective contributions, if any, but excluding any amounts used to satisfy the minimum top heavy allocation described in Appendix A) made on behalf of the Eligible Employee for the Plan Year, plus (ii) Taxed Contributions made on behalf of or by the Eligible Employee for the Plan Year, by

(b)   the Eligible Employee’s Earnings for that Plan Year.

(I) an Employee who is directly or indirectly eligible to make a Tax Deferred Contribution or to receive an allocation of Matching Contributions and Performance Matching Contributions (including allocations derived from forfeitures) under the Plan for a Plan Year;

(II) an Employee who is unable to make a Tax Deferred Contribution or to receive an allocation of Matching Contributions or Performance Matching Contributions because the Employee has not contributed to this Plan or another plan of an Affiliated Company;

(III) an Employee who would be eligible to make Tax Deferred Contributions but for a suspension due to a distribution, a loan or an election not to participate in the Plan (other than certain one-time elections), even though  the Employee may not make such Tax Deferred Contributions or receive an allocation of Matching Contributions or Performance Matching Contributions by reason of such suspension; or

(IV) an Employee who is unable to make a Tax Deferred Contribution or to receive an allocation of Matching Contributions or Performance Matching Contributions because such Employee may receive no additional annual additions because of Section 415(c)(1) or, prior to January 1, 2000, because of Section 415(e) of the Code.

(x) Matching Contributions and Performance Matching Contributions that a Participant forfeits because they correspond to Tax Deferred Contributions in excess of the permissible dollar limits contained in Code Section 402(g);

(y) Matching Contributions and Performance Matching Contributions forfeited, or returned to the Participant, in order to correct an allocation in excess of Section 415(c) of the Code; and

(z) Matching Contributions and Performance Matching Contributions that a Participant forfeits in conjunction with a distribution made to meet the limitations described in Sections 3.02 and 3.05 of the Plan.

(a)   the sum of (i) the Tax Deferred Contributions made on behalf of or by the Eligible Employee for the Plan Year, and (ii) qualified non-elective or qualified matching contributions, if any, by

(b)   the Eligible Employee’s Earnings for that Plan Year.

(a)   the Company,

(b)   each other corporation that is a member of a controlled group of corporations (as defined in Code Section 414(b), i.e., determined in accordance with Code Section 1563(a), without regard to Code Sections 1563(a)(4) and 1563(e)(3)(C), except that the phrase “more than 50 percent” shall be substituted for the phrase “at least 80 percent” wherever it appears in Code Section 1563(a)(1)) that includes the Company,

(c)   any trade or business under common control (as defined in Code Section 414(c)) with the Company),

(d)   any organization (whether or not incorporated) which is part of an affiliated service group that includes the Company,

(e)   any entity required to be aggregated with the Company pursuant to regulations under Code Section 414(o),

(f)   any subsidiary of the Company designated as an Affiliated Employer by the Company.

(A)   as applied to transactions involving Company Stock,

(i)   if shares of Company Stock are sold, the weighted average net share price the Trustee receives for all shares sold on a given date, or, if not all directions to sell can be fully executed on a given date, then the weighted average net share price received over the period necessary to fully execute such direction to sell (the last day of such period being referred to as the “settlement date”), which average shall be based on the average net proceeds per share sold on each day a sale is made in accordance with the direction to sell until the entire amount directed as of the given date to be sold has been sold.

(ii)   if shares of Company Stock are purchased (and subparagraph iii is inapplicable), the weighted average price per share (including commissions and other expenses, if any) the Trustee pays for all shares on the date of the purchase, or, if not all directions to purchase can be fully executed on a given date, then the weighted average share price paid over the period necessary to fully execute such direction to purchase (including commissions and other expenses, if any), which shall be based on the average price per share (including commissions and other expenses, if any) paid on each day a purchase is made in accordance with the direction to purchase until such direction has been fully executed.

(iii)   if shares of Company Stock are purchased directly from the Company or directly contributed by the Company, whether such shares are treasury stock, authorized and previously unissued shares, or shares previously issued and repurchased by the Company, then the purchase price (or contribution value) shall be the weighted average price per share that the Trustee would pay for shares purchased on the open market (as of the date that contributions are wired to the Trustee, in the case of Participant directed investments); expressly provided, however, that no commissions shall be charged with respect to such purchases (or contributions) and if there are no open market purchases made by the Trustee on such date, then the purchase price per share  (or contribution value per share) for such stock shall be the average of the high and low price for Company Stock as reported on the New York Stock Exchange consolidated transaction reporting system on such date.

(B)   as applied to transactions involving other investments permitted under the terms of the Plan, the closing market price as reported by the National Association of Securities Dealers, the New York Stock Exchange consolidated transaction reporting system or such other third-party reporting system or pricing source as the Trustee shall determine is appropriate for the applicable investment

(i)   if the recordkeeper receives a direction to buy or sell by 4 p.m. Eastern Time (or such other time established by the record keeper from time to time or for a particular date) on a day the markets are open, on the date the order is received, or

(ii)   if the recordkeeper receives an order to buy or sell after such time or the markets are not open on the date on which the instruction is received, as of the next succeeding business date.

(C)   for reporting purposes (which includes, but is not limited to, reports provided via Participant Account statements,  and the online reporting system (if any) or voice response system (if any) of the recordkeeper), the closing market price of the particular investment, as reported by the applicable third-party reporting system or pricing source, provided, however, that if the last day of the reporting period is not a business day, then the closing market price as of the most recent preceding business day shall be used.  Notwithstanding the foregoing,

(i)   if a Participant directs that some or all of the Company Stock in his account be sold, the net proceeds of the sale will be credited to his Account, and his Account shall be updated, as of the settlement date based on the Current Market Value described in subparagraph (A)(i) above;

(ii)   if a Participant directs the purchase of Company Stock for his account, the Company Stock will be credited to his Account, and his Account shall be updated, as of the settlement date based on the Current Market Value described in subparagraph (A)(ii) above; and

(iii)   any transfer of assets into, or out of, other Funds, related to a purchase or sale of Company Stock, will not be effected until the settlement date of such transaction.

(i)   was a Five Percent Shareholder during the Plan Year or the previous Plan Year; or

(ii)   had Earnings in excess of $80,000 for the previous Plan Year and, effective for Plan Years beginning on and after January 1, 2001, was in the group consisting of the top 20% of Employees when ranked on the basis of compensation paid during such previous Plan Year.  The foregoing dollar threshold in (ii), above, shall be adjusted at the same time and in the same manner as the dollar limit on benefits under a defined benefit plan is adjusted pursuant to Section 415(d) of the Code  The dollar threshold for a particular look back year is based on the dollar threshold in effect for the calendar year in which the look back year begins.  A former Eligible Employee shall be considered a Highly Compensated Employee if he was a Highly Compensated Employee either for the Plan Year in which his separation from service began or for any Plan Year ending on or after the former Eligible Employee’s 55th birthday.  The determination of who is a Highly Compensated Employee will be made in accordance with Section 414(q) of the Code and the regulations thereunder.

(a)   prior to July 1, 1976, the Participant’s period of continuous participation in the Plan to July 1, 1976, and the waiting period in effect with respect to such Participant; and

(b)   from July 1, 1976, the aggregate period or periods beginning on July 1, 1976, or the date on which the Participant is first credited with an Hour of Service (or his reemployment commencement date), if later, and ending on his next following Severance from Service Date.  In addition, effective July 1, 1976, (i) if an individual incurs a Severance from Service Date as the result of a voluntary termination, discharge or retirement and he returns to service within 12 months of his Severance from Service Date, or (ii) if during an absence from service for any reason other than a voluntary termination, discharge or retirement, he incurs a Severance from Service Date as the result of a voluntary termination, discharge or retirement and he returns to service within 12 months of the date on which he was first absent from service, the period during which he is absent from service shall be included in his Period of Continuous Service.

(a)   with respect to any Five Percent Owner, the “Required Beginning Date” shall be determined without regard to clause (2) above, and

(b)   with respect to any Active Participant who reached age 70 ½ during 1996, 1997 or 1998, such Participant’s Required Beginning Date shall be April 1 of the calendar year following the year in which the Participant reaches age 70 ½, unless the Participant elects to defer the commencement of his benefits until his actual retirement.

(c)   A Participant is a “Five Percent Owner” if such Participant is a 5 percent owner as defined in Code Section 416(i) at any time during the Plan Year ending with or within the calendar year in which such owner reaches age 66 1/2 or in any subsequent Plan Year.

(a)   as a result of the pregnancy of the employee, the birth of a child of the employee, the placement of a child with the employee by reason of adoption or for purposes of caring for a child of the employee immediately following the child’s birth or adoption, or

(b)   on or after January 1, 1993, by reason of the placement of a child with the Employee in connection with the foster care of any such child by the Employee, for the purposes of caring for any such child during the period immediately following such child’s foster care placement, because the employee is needed to care for a family member with a serious health condition, or because the employee’s own serious health condition makes the employee unable to perform the functions of his job, then a Severance from Service Date shall not occur until the second anniversary of the separation from service.

2.01   On the Restatement Effective Date .  Any Eligible Employee who was an Active Participant in the Plan immediately prior to its restatement, shall be an Active Participant in the restated Plan on its Restatement Effective Date, provided he is still an Eligible Employee.

2.02   After the Restatement Effective Date .  Any other Eligible Employee may become an Active Participant as soon as practicable after completing the enrollment procedure prescribed by the Administrative Committee without satisfying a waiting period.

(a)   Eligibility Requirement for Aegis Retirement Contribution.  Aegis Employees shall be entitled to Aegis Retirement Contributions only if they have completed  at least one Year of Service by December 31 of the year with respect to which a contribution is being made.

(b)   Eligibility Requirement for Monarch Retirement Contribution.  Monarch Employees shall be entitled to Monarch Retirement Contributions only if they have completed at least one Year of Service by December 31 of the year with respect to which a contribution is being made, including service with Monarch prior to its acquisition by the Company.

3.01   Tax Deferred Contributions

(a)   Subject to the provisions of this Section 3.01 and Section 3.02, each Active Participant may elect to have his Compensation reduced by from 1% to 15% (in whole integers) during the period in which such Compensation is paid and have that amount contributed to the trust fund by his Participating Employer on his behalf. Effective with respect to deferrals made on or after January 1, 2002, the 15% limit shall no longer apply to Active Participants who are Non-Highly Compensated Employees.  At any time, the Administrative Committee may reduce the rate of future Tax Deferred Contributions to be made on behalf of Active Participants who are Highly Compensated Employees in order to satisfy the test described in Section 3.02.  If the Compensation of an Active Participant is changed, the dollar amount of his Tax Deferred Contributions will automatically be changed so that the percentage elected is not changed.

(b)   In no event shall the Tax Deferred Contributions when added to all other elective deferral contributions (within the meaning of Code Section 402(g)(3)) made on behalf of any Active Participant under any plan maintained by an Affiliated Company for any calendar year exceed the maximum dollar amount as determined by the Commissioner of Internal Revenue pursuant to Code Section 402(g) for such calendar year (i.e., $10,500, 2000 and 2001 $11,000 for 2002, $12,000 for 2003, $13,000 for 2004, $14,000 for 2005 and $15,000 for 2006).  In the event the foregoing dollar limitation is exceeded for any calendar year, the excess Tax Deferred Contributions, plus the pro rata share of income and losses thereon, determined as of the distribution date in accordance with regulations issued by the Secretary of the Treasury, shall be distributed to the Participant on whose behalf such contribution was made by April 15 of the following calendar year.

(c)   An Active Participant eligible to have Tax Deferred Contributions made on his behalf may elect to completely suspend such contributions or to change the percentage of the reduction in his Compensation; provided, however, that such suspension or change will not take effect until the Active Participant’s next pay period following the recordkeeper’s receipt of such instruction.

(d)   Tax Deferred Contributions for any month will be paid by the Active Participant’s Participating Employer to the trust fund as soon as feasible after the end of each pay period, but in no event later than fifteen (15) business days following the end of the month with respect to which such amounts are withheld.

(e)   Effective with respect to Tax Deferred Contributions made in Plan Years commencing on or after January 1,2002. and notwithstanding the limitations in Section 3.01(b) above, all Employees eligible to make Salary Reduction Contributions who have attained age 50 before the close of the Plan Year shall be eligible to make Catch-up Contributions in accordance with and subject to the limitations of section 414(v) of the Code (i.e., for 2002 the “applicable dollar limit” is $1,000, $2,000 for 2003, $3,000 for 2004, $4,000 for 2005, and $5,000 for 2006 and thereafter).  Such Catch-up Contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code.  The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of section 401(k)(3), 401(k)(1l), 401(k)(12), 410(b) or 416 of the Code, as applicable, by reason of the making of such Catch-up Contributions.  Catch-up Contributions shall be treated as Tax Deferred Contributions and shall be allocated to Active Participants’ Tax Deferred Contribution Accounts.  Such additional “catch-up” contributions shall be unmatched, unless the Active Participant has not already contributed the amount necessary to entitle him to the maximum Matching Contribution under Section 5.03, in which case such “catch-up” contributions shall be matched up to the maximum specified in Section 5.03.  Catch-up Contributions shall not be considered Salary Reduction Contributions for purposes of the Average Deferral Percentage test of Section 3.02 of the Plan.  The extent to which an Active Participant’s Tax Deferred Contributions are characterized as catch-up contributions, rather than Taxed Contributions, or Excess Contributions otherwise subject to .the various Plan and Code limitations, shall be determined by the Administrative Committee as of the end of the Plan Year, in accordance with Code Section 414(v) and regulations issued thereunder.

3.02   Limitation on Tax Deferred Contributions .  The Administrative Committee shall make the following determinations separately with respect the Bargaining Unit Employees and Non-Bargaining Unit Employees.

(a)   If the Tax Deferred Contributions (plus any qualified non-elective or qualified matching contributions treated as Tax Deferred Contributions) made on behalf of the Highly Compensated Employees for any Plan Year are in excess of the amount permitted under the following provisions for such Highly Compensated Employees, such excess contributions plus the pro rata share of income and losses thereon determined as of the distribution date in accordance with regulations issued by the Secretary of the Treasury shall be distributed to such Highly Compensated Employees by the end of the following Plan Year and, if possible, before the close of the first two and one half months of the following Plan Year.  Alternatively, with respect to such Plan Year, the Company may, in its discretion, make qualified non-elective and qualified matching contributions, as defined in Treas. Reg. Section 1.401(k)-1(g)(13), subject to the requirements for full vesting and the Code Section 401(k) withdrawal restrictions, as may be necessary for the following provisions of this section to be satisfied.  Any qualified non-elective and qualified matching contributions treated as Tax Deferred Contributions for purposes of satisfying the provisions of this section shall not be taken into account for purposes of satisfying the average contribution percentage test of Code Section 401(m) as provided in Section 3.05 hereof.

(b)   All or a portion of the Tax Deferred Contributions (plus any qualified non-elective or qualified matching contributions treated as Tax Deferred Contributions) for Highly Compensated Employees shall be deemed to be excessive for the then current Plan Year if the Actual Deferral Percentage for such Highly Compensated Employees exceeds the greater of (i) or (ii) below:

(i)   the product of the Actual Deferral Percentage for all Eligible Employees (other than Highly Compensated Employees) who are eligible to have Tax Deferred Contributions made on their behalf multiplied by 1.25, or

(ii)   the product of the Actual Deferral Percentage for all Eligible Employees (other than Highly Compensated Employees) who are eligible to have Tax Deferred Contributions made on their behalf multiplied by 2.0; provided, however, that the product described in this clause (ii) shall be limited to the sum of the Actual Deferral Percentage for all Eligible Employees (other than Highly Compensated Employees) plus two percentage points.

(c)   In the event any portion of a Participant’s Tax Deferred Contributions are distributed pursuant to Section 3.01(b) as a result of the dollar limit applicable to Tax Deferred Contributions pursuant to Code Section 402(g), (i) any excess contributions required to be distributed pursuant to Section 3.02(b) shall be reduced by the amount of such excess deferrals and (ii) such Participant’s Actual Deferral Percentage shall be determined before such excess deferral is distributed if the Participant is a Highly Compensated Employee.

(d)   Notwithstanding the foregoing, the Administrative Committee may, in its discretion, permit a Participant with excess contributions that would otherwise be distributed pursuant to Section 3.02(b), above, to elect to have all or part of such excess contribution recharacterized as a Taxed Contribution; provided, however, that (i) such recharacterization shall occur within 2 1/2 months after the close of the Plan Year to which the excess contribution relates; (ii) the recharacterized amounts shall be reported by the Company as includible in the Participant’s taxable income as of the earliest date any Tax Deferred Contribution made on behalf of the Participant during the Plan Year would have been received by the Participant but for the Participant’s election to defer; (iii) the recharacterized amount shall continue to be treated as an employer contribution for purposes of the deduction rules of Code Section 404, the annual additions limits of Code Section 415 and certain other purposes stated in Treas. Reg. Section 1.401(k)-1(f)(3)(ii); (iv) the recharacterized amounts shall continue to be subject to the distribution and nonforfeitability rules applicable to Tax Deferred Contributions and other elective contributions under Code Section 401(k); (v) the recharacterized amounts shall be taken into account for purposes of the average contribution percentage test of Code Section 401(m), as provided in Section 3.05 of the Plan; and (vi) the election to recharacterize shall be subject to such uniform, generally applicable administrative procedures as determined by the Administrative Committee.  For Plan Years commencing on or after January 1, 2002, the Administrative Committee may in its discretion recharacterize Excess Tax Deferred Contributions that would otherwise be distributed pursuant to this Section 3.02 as Catch-up Contributions in accordance with Section 3.01(e) hereof and section 414(v) of the Code, provided that the applicable dollar amount has not already been met for the calendar year.

(e)   The amount of Tax Deferred Contributions to be distributed pursuant to paragraph (a) above shall be determined by making the following adjustments to the Tax Deferred Contributions for Participants who are Highly Compensated Employee so that after adjustment one of the two tests of paragraph (b), above, is met and the excess Tax Deferred Contributions have been reduced to zero.

(i)   Each Participant who is a Highly Compensated Employee, beginning with the Participant having the highest dollar deferral, shall have Tax Deferred Contributions in excess of the permissible deferral percentage limits (“Excess Contributions”) returned to such Participant (together with income or loss allocable thereon) until such Participant’s Tax Deferred Contributions are reduced to the dollar amount of the Tax Deferred Contributions of the Highly Compensated Employee with the next highest dollar amount of Tax Deferred Contributions and continuing in descending order with the next Highly Compensated Employee with the next highest dollar deferral, until one of the tests described in paragraph (b) is satisfied.  If such amounts are distributed more than two and one-half (2-1/2) months after the last day of the Plan Year in which the excess arose, a ten percent (10%) excise tax will be imposed on the Company.  Such distributions shall be made to Highly Compensated Employees on the basis of the respective portions of the Excess Contributions attributable to each such Employee.  Determination of income or loss for Excess Contributions up to the date of distribution shall be made in the same manner as income or loss for excess Tax Deferred Contributions that exceed the limit of Code Section 402(g).

(ii)   Excess Contributions shall be determined under the following procedures:

(1)   calculate the dollar amount of Excess Contributions for each affected Highly Compensated Employee as follows:

(A)   Rank all Highly Compensated Employees in descending order based on their Actual Deferral Percentage and then reduce the Actual Deferral Percentage of the Highly Compensated Employee with the highest Actual Deferral Percentage by the amount required to cause such Highly Compensated Employee’s Actual Deferral Percentage to equal the Actual Deferral Percentage of the Highly Compensated Employee with the next highest Actual Deferral Percentage (or, if less, by the reduction necessary to enable the Plan to satisfy one of the two tests described in paragraph (b), above);

(B)   Repeat the process in (A) above with respect to all Highly Compensated Employees with the next highest Actual Deferral Percentage, until the Plan satisfies one of the two tests described in paragraph (b), above, and the highest permitted Actual Deferral Percentage is determined;

(C)   The amount of Excess Contributions for each Highly Compensated Employee shall be an amount equal to such Highly Compensated Employee’s Tax Deferred Contributions (plus any qualified nonelective contributions or qualified matching contributions taken into account in determining such Highly Compensated Employee’s Actual Deferral Percentage prior to applying (A) and (B) above), minus an amount determined by multiplying such Highly Compensated Employee’s Actual Deferral Percentage, determined after applying (A) and (B) above, by the Compensation used in determining such Highly Compensated Employee’s Actual Deferral Percentage;

(2)   Determine the total of the dollar amounts (total Excess Contributions) calculated in Step (1);

(3)   Distribute the total Excess Contributions determined in (2) above as follows:

(A)   Rank all Highly Compensated Employees in descending order based on the dollar amount of their Tax Deferred Contributions and reduce the Tax Deferred Contributions of the Highly Compensated Employee with the highest dollar amount of Tax Deferred Contributions by the amount required to cause that Highly Compensated Employee’s Tax Deferred Contributions to equal the dollar amount of the Tax Deferred Contributions of the Highly Compensated Employee with the next highest dollar amount of Tax Deferred Contributions.

(B)   Distribute the amount determined in (A) above to the Highly Compensated Employee with the highest dollar amount until all Excess Contributions are consumed, or until the Tax Deferred Contributions of this Participant are reduced to the dollar amount of the Highly Compensated Employee with the next highest dollar amount of Tax Deferred Contributions;

(4)   If the total amount distributed under (3) above is less than the Total Excess contributions, repeat step (3).

(iii)   Notwithstanding the foregoing, the amount of Excess Contributions to be distributed under this Section 3.02(e) with respect to a Highly Compensated Employee for a Plan Year is reduced by any excess deferrals previously distributed to such Employee for the Employee’s taxable year ending with or within the Plan Year, and the amount of excess deferrals to be distributed under this Section 3.02(e) with respect to a Highly Compensated Employee for a Plan Year is reduced by any Excess Contributions previously recharacterized or distributed to such Employee for the Employee’s taxable year ending with or within the Plan Year.

3.03   Taxed Contributions .

(a)   Subject to the provisions of Section 3.05, an Active Participant may elect to contribute Taxed Contributions to the trust fund by authorizing monthly payroll deductions of from 1% to 18% (in whole integers) of his Compensation.  An Active Participant’s Taxed Contributions may not exceed the difference between (i) 18% of his Compensation and (ii) the percentage of his Compensation contributed as a Tax Deferred Contribution; expressly provided, however that with respect to Taxed Contributions made on and after January 1, 2002, the 18% limit shall no longer apply to Participants who are Non-Highly Compensated Employees.  At any time, the Administrative Committee may reduce the rate of future Taxed Contributions to be made by Highly Compensated Employees in order to satisfy the test described in Section 3.05.  If the Compensation of an Active Participant is changed, the dollar amount of his Taxed Contributions will automatically be changed so that the percentage elected is not changed.

(b)   An Active Participant may elect to completely suspend such contributions or to change the percentage of his Taxed Contributions; provided, however, that such suspension or change will not take effect until the Active Participant’s next pay period following the recordkeeper’s receipt of such instruction.

(c)   Taxed Contributions for any month will be paid by the Active Participant’s Participating Employer to the trust fund as soon as feasible after the end of each pay period but in no event later than fifteen (15) business days following the end of the month with respect to which such amounts are withheld.

3.04   Employer Contributions .  Notwithstanding anything in the Plan to the contrary, no Matching Contribution shall be made with respect to Tax Deferred Contributions and Taxed Contributions made by salaried Active Participants on and after January 1,2003 pursuant to Section 3.04(a) or (b) hereof.

(a)   Participating Employer Contributions.

(i)   [Reserved]

(ii)   Required Matching Contributions.  Each Participating Employer shall contribute an amount sufficient to provide the allocations described in Section 5.03(a) and 5.04(a) with respect to its Active Participants.  Effective October 17, 2003, such contributions shall be made in cash, provided, however, that the Company may still make such contribution in Company Stock for those Participants who elect to invest in the Olin Common Stock Fund.  Such contributions shall not be made on behalf of collectively bargained Employees, including without limitation those employed by Monarch and its affiliates, unless  otherwise provided pursuant to collective bargaining. An Active Participant’s entitlement to receive an allocation of Performance Matching Contributions under Section 5.04 with respect to a Plan Year shall be based on the Performance Matching formula applicable to such Participant determined by the identity of his Participating Employer as of the end of the Plan Year with respect to which the allocation is being made.  In the event that such Participant’s matched Tax Deferred Contributions are later recharacterized as Catch-up Contributions, and the Participant is not entitled to a Company Contribution on such Catch-Up Contributions in accordance with Section 3.01(e), the related Company Contributions (and earnings thereon), if any, shall be forfeited by such Participant, to the extent then forfeitable.

(iii)   Additional Discretionary Matching Contributions.  With respect to a Plan Year and subject to the applicable Code limits, each Participating Employer may make such additional discretionary Matching Contributions for the benefit of its Active Participants, in cash, (provided, however, that the Company may make such contributions in Company Stock for those Participants who elect to invest in the Olin Common Stock Fund) as the Company shall, in its discretion determine, with such contribution being allocated to its Active Participants in the same manner as the Matching Contributions provided for in Section 5.03(a).  Such contributions shall not be made on behalf of collectively bargained Employees, including without limitation those employed by Monarch and its affiliates, unless  otherwise provided pursuant to collective bargaining.

.

(b)   [Reserved.]

(c)   Aegis  Retirement Contributions.  With respect to each fiscal year coinciding with, or ending within a Plan Year in which it has a net operating profit, beginning with the 1996 Plan Year, Aegis shall make a service weighted contribution in cash on behalf of each Employee who (i) is employed by Aegis, (ii) has completed one Year of Service by December 31 of the year with respect to which the contribution is to be made, and (iii) has completed One Thousand Hours of Service in such year.  This Aegis Retirement Contribution shall be allocated to such eligible Aegis Active Participants, in accordance with a service weighted formula set forth in Section 5.05, regardless of whether they contribute Tax Deferred or Taxed Contributions under the Plan.

(d)   Monarch Retirement Contributions.  With respect to each fiscal year coinciding with, or ending within a Plan Year, beginning with the 2001 Plan Year, Monarch shall make a contribution to this Plan in cash equal to five percent (5%) of the Compensation (including Compensation earned from January 1, 2001 to the date of the acquisition of Monarch Brass and Copper Company by the Company as well as Compensation earned thereafter) of each eligible collectively bargained Employee who (i) is employed by Monarch Brass and Copper Company, Waterbury Rolling Mills, Inc. or the New Haven Copper Company on the last day of the Plan Year or who terminates during such Year on account of retirement on or after Normal Retirement Date, death, or Total and Permanent Disability, (ii) completes one Year of Service by December 31 of the Year with respect to which the contribution is to be made (including prior service with Monarch and its affiliates prior to their acquisition by the Company), and (iii) has completed One Thousand Hours of Service in such year.  In addition, with respect only to the year in which Monarch Brass and Copper Company and its affiliates were acquired by the Company, Monarch shall make a contribution to the Plan in cash equal to five percent (5%) of the Compensation paid from January 1, 2001 through May 31, 2001 of salaried Employees who satisfy the requirements of (d)(i), (ii) and (iii) above. The Monarch Retirement Contribution shall be allocated to each such eligible Monarch Active Participant in accordance with the provisions of Section 5.06, regardless of whether such Participant makes Tax Deferred or Taxed Contributions under the Plan. With respect to the 2001 Plan Year only, Monarch’s obligation under this subsection (d) shall be reduced to the extent that it made some portion or all of the five percent (5%) contribution under the terms of its stock bonus plans, which were merged into this Plan as of September 1, 2001.

3.05   Limitation on Taxed Contributions and Company Contributions .  The Administrative Committee shall make the following determinations separately with respect to the Bargaining Unit Employees and Non-Bargaining Unit Employees.

(a)   If the aggregate of Taxed Contributions and the fair market value of the Company Contributions that are matching contributions within the meaning of Code Section 401(m) allocated to the Highly Compensated Employees for any Plan Year are in excess of the amount permitted under the following provisions for such Highly Compensated Employees, such excess amounts plus the pro rata share of income and losses thereon, determined as of the distribution date in accordance with regulations issued by the Secretary of the Treasury, shall be forfeited to the extent such contributions are not vested, and to the extent such contributions are vested, they shall be distributed by the end of the following Plan Year and, if possible, before the close of the first two and one half months of the following Plan Year.  Alternatively, if the Company has elected that the Average Contribution Percentage test be applied using the ACP percentages of Non-Highly Compensated Employees for the current Plan Year, then  with respect to such Plan Year, the Company may, in its discretion, make qualified non-elective contributions, as defined in Treas. Reg. Section 1.401(m)-1(f)(15), subject to the requirements for full vesting and the Code Section 401(k) withdrawal restrictions, as may be necessary for the following provisions of this section to be satisfied.  Any qualified non-elective contributions treated as Taxed Contributions for purposes of satisfying the provisions of this section shall not be taken into account for purposes of satisfying the average deferral percentage test of Code Section 401(k) as provided in Section 3.02 hereof.

(b)   All or a portion of the aggregate of Taxed Contributions and the fair market value of the Company Contributions that are matching contributions within the meaning of Code Section 401(m) allocated to Highly Compensated Employees shall be deemed to be excessive for the then current Plan Year if the Actual Contribution Percentage for such Highly Compensated Employees exceeds the greater of (i) or (ii) below:

(i)   the product of the Actual Contribution Percentage for all Eligible Employees other than Highly Compensated Employees multiplied by 1.25, or

(ii)   the product of the Actual Contribution Percentage for all Eligible Employees other than Highly Compensated Employees multiplied by 2.0; provided, however, that the product described in this clause (ii) shall be limited to the sum of the Actual Contribution Percentage for all Eligible Employees other than Highly Compensated Employees plus two percentage points.

(A)   the sum of (i) 1.25 multiplied by the greater of the Actual Contribution Percentage or the Actual Deferral Percentage for the Plan Year for all Eligible Employees other than Highly Compensated Employees plus (ii) the lesser of the Actual Contribution Percentage or the Actual Deferral Percentage for the Plan Year for all Eligible Employees other than Highly Compensated Employees plus two percentage points; provided, however, that the amount determined under this clause (ii) may not exceed the product of 2.0 multiplied by the lesser of the Actual Contribution Percentage or the Actual Deferral Percentage for all Eligible Employees other than Highly Compensated Employees; or

(B)   the sum of (i) 1.25 multiplied by the lesser of the Actual Contribution Percentage or the Actual Deferral Percentage for the Plan Year for all Eligible Employees other than Highly Compensated Employees plus (ii) the greater of the Actual Contribution Percentage  or the Actual Deferral Percentage for the Plan Year for all Eligible Employees other than Highly Compensated Employees plus two percentage points; provided, however, that the amount determined under this clause (ii) may not exceed the product of 2.0 multiplied by the greater of the Actual Contribution Percentage or the Actual Deferral Percentage for all Eligible Employees other than Highly Compensated Employees.

(c)   An Eligible Employee’s Actual Contribution Percentage shall be determined before his or her excess Tax Deferred Contributions (and other amounts subject to Code Section 401(k) restrictions) are distributed and the value of the related Company Contributions are forfeited.

(d)   The amount to be distributed or forfeited pursuant to paragraph (a), above, shall be determined by making the reducing the amount of the aggregate of the Taxed Contributions plus any matching contributions within the meaning of Code Section 401(m) (“Excess Aggregate Contributions”) of Participants who are Highly Compensated Employees so that after adjustment one of the two tests of paragraph (b), above (including the multiple use aggregate limit, if applicable), is met and the Excess Aggregate Contributions have been reduced to zero.  To the extent possible, a Highly Compensated Employee’s Excess Aggregate Contributions shall be reduced by distributing Taxed Contributions before matching contributions within the meaning of Code Section 401(m) .

(i)   Each Participant who is a Highly Compensated Employee, beginning with the Participant having the greatest Excess Aggregate Contributions, shall have his Excess Aggregate Contributions (together with income or loss allocable thereon determined in the same manner as for excess Tax Deferred Contributions under Section 3.02 of the Plan) reduced until his Aggregate Contributions are reduced to the Aggregate Contributions of the Highly Compensated Employee with the next highest Aggregate Contributions, and continuing as necessary until one of the two tests described in paragraph (b) is satisfied.  Such reductions shall be made to each Highly Compensated Employee on the basis of the respective portions of the Excess Aggregate Contributions attributable to each such Highly Compensated Employee.

(ii)   The total Excess Aggregate Contributions to be forfeited or distributed shall be determined under the following procedure:

(1)   Calculate the dollar amount of Excess Aggregate Contributions for each affected Highly Compensated Employee as follows:

(A)   Rank all Highly Compensated Employees in descending order based on their Actual Contribution Percentage and then reduce the Actual Contribution Percentage of the Highly Compensated Employee with the highest Actual Contribution Percentage by the amount required to cause such Highly Compensated Employee’s Actual Contribution Percentage to equal the Actual Contribution Percentage of the Highly Compensated Employee with the next highest Actual Contribution Percentage or, if less, by the reduction necessary to enable the Plan to satisfy one of the two tests described in paragraph (b), above.

(B)   Repeat the process in (A), above, with respect to the Highly Compensated Employee with the next highest Actual Contribution Percentage, until the Plan satisfies one of the two tests described in paragraph (b), above, and the highest permitted Actual Contribution Percentage is determined.

(C)   The amount of Excess Aggregate Contributions for each Highly Compensated Employee shall be an amount equal to such Highly Compensated Employee’s Aggregate Contributions taken into account in determining such Highly Compensated Employee’s Actual Contribution Percentage prior to applying (A) and (B) above, minus an amount determined by multiplying such Highly Compensated Employee’s Actual Contribution Percentage, determined after applying (A) and (B) above, by the Compensation used in determining such Highly Compensated Employee’s Actual Contribution Percentage.

(2)   Determine the total of the dollar amounts (total Excess Aggregate Contributions) calculated in Step (1).

(3)   Distribute or forfeit the total Excess Aggregate Contributions determined in Step (2) as follows:

(A)   Rank all Highly Compensated Employees in descending order based on the dollar amount of their Aggregate Contributions and reduce the Aggregate Contributions of the Highly Compensated Employee with the highest dollar amount of Aggregate Contributions by the amount required to cause that Highly Compensated Employee’s Aggregate Contributions to equal the dollar amount of the Aggregate Contributions of the Highly Compensated Employee with the next highest dollar amount of Aggregate Contributions.

(B)   The amount determined in (A), above, shall be distributed to (if attributable to Taxed Contributions) or forfeited by (if attributable to Company Contributions) the Highly Compensated Employee with the highest dollar amount until all Excess Aggregate Contributions are consumed or until the Aggregate Contributions of such Participant is reduced to the dollar amount of the Highly Compensated Employee with the next highest dollar amount of Aggregate Contributions, whichever is less.  To the extent possible, a Highly Compensated Employee’s Actual Contribution Percentage shall be reduced by distributing Taxed Contributions before matching contributions within the meaning of Code Section 401(m).

(1)   If the total amount distributed under Step (3) above is less than the total Excess Aggregate Contributions, repeat Step (3).

(e)   In its discretion, Administrative Committee may limit Taxed Contributions or Company Contributions in a manner that prevents Excess Aggregate Contributions from being made, provided that any such limit shall be nondiscriminatory, applied on a uniform basis and permitted by applicable provisions of the Code and regulations thereunder.

3.06   Rollover Contributions and Prior Plan Transfers .

(a)   prior to January 1, 2002, no part of any distribution that is attributable to after-tax contributions may be rolled over to this Plan;

(b)   no part of any hardship distribution may be rolled over to this Plan;

(c)   no distribution that is made to comply with the minimum required distribution rules of Code section 401(a)(9) may be rolled to this Plan; and

(d)   no distribution that one of a series of substantially equal periodic payments made over the life (or life expectancy) of the Active Participant or the joint lives (or joint life expectancies) of the Active Participant and his designated Beneficiary, or for a specified period of ten years or more may be rolled over to this Plan.

3.07   Benefit and Contribution Limitations .

(a)   Notwithstanding any other provision of this Plan, the sum of the annual additions (as hereinafter defined) to a Participant’s Account for limitation year (which shall be the calendar year) shall not exceed the lesser of

(i)   $40,000 (as adjusted for increases in the cost of living under Section 415(d) of the Code), or

(ii)   100% of the Participant’s compensation (as defined in Code Section 415(c)(3)) for such limitation year from all Affiliated Companies.

(b)   Annual additions to a Participant’s Account for a Plan Year shall be the sum of:

(i)   the Participant’s Tax Deferred Contributions for such Plan Year, except to the extent exempted as “catch-up” contributions in accordance with Code Section 414(v);

(ii)   for Plan Years beginning after December 31, 1986, the Participant’s Taxed Contributions for such Plan Year;

(iii)   the employer contributions allocated to the Participant’s Account (including, but not limited to, Company Contributions);

(iv)   forfeitures allocated to the Participant’s Account;

(v)   amounts allocated, after March 31, 1984, to an individual medical account, as defined in Code Section 415(l)(2) which is part of a pension or annuity plan maintained by a Participating Employer; and

(vi)   amounts derived from contributions paid or accrued after December 31, 1985 in taxable years ending after such date, are attributable to post-retirement medical benefits allocated to the separate account of a key employee (as defined in Code Section 419A(d)(3)) under a welfare benefit plan (as defined in Code Section 419(e)) maintained by a Participating Employer;

(c)   Annual additions to a Participant’s Account for a Plan Year shall not include:

(i)   transfers or rollover contributions;

(ii)   Participant repayments of a plan loan, a cash-out distribution or of a distribution of mandatory contributions (within the meaning of Code Section 411(a)(3)(D); or

(iii)   employee contributions to a simplified employee pension excludable from gross income under Code Section 408(k)(6).

(d)   In the event that it is determined that the annual additions to a Participant’s Account for any Plan Year would be in excess of the limitations contained herein, such annual additions shall be reduced to the extent necessary to bring such annual additions within the limitations contained in this Section 3.07.  Likewise, for any Limitation Year beginning before January 1, 2000, in the event that any Participant of the Plan is also a Participant in any defined benefit plan or plans maintained by an Affiliated Company and it is determined that the annual additions to a Participant’s Account for any Plan Year when considered with the Participant’s projected annual benefit under such defined benefit plan or plans would be in excess of the limitations contained in Section 3.08 hereof, such annual additions and benefits shall be reduced to the extent necessary to satisfy the limitations contained in Section 3.08.  In general, the required reductions in annual additions and benefits shall be made by proceeding only as far as necessary through the following sequence, with reductions at each level being prorated among all affected plans making provision for such reductions:

(1)   return of Taxed Contributions, plus any earnings thereon, if any, to the extent they are treated as annual additions;

(2)   return of Tax Deferred Contributions, plus any earnings thereon, if any, to the extent they are treated as annual additions;

(3)   reduction of defined contribution plan annual additions other than Taxed Contributions and Tax-Deferred Contributions.

4.01   [Reserved]

4.02   [Reserved]

4.03   Limitations on Stock Acquired with Proceeds of an ESOP Loan .  Except as otherwise permitted in Sections 409(h) and (l) of the Code and regulations promulgated thereunder, no Company Stock acquired with the proceeds of an ESOP Loan shall be subject to any put, call, or other option or any buy sell or similar agreement while held by and when distributed from the trust fund, whether or not the Plan constitutes an “employee stock ownership plan” within the meaning of Section 4975(e)(7) of the Code at such time and whether or not the ESOP Loan has been repaid at such time.

4.04   [Reserved]

4.05   [Reserved]

5.01   Tax Deferred Contributions and Taxed Contributions .  Tax Deferred Contributions and Taxed Contributions made on behalf of or by a Participant shall be allocated to his Tax Deferred Contribution Account or Taxed Contribution Account, as appropriate, as soon as practicable after such contributions are transferred to the trust fund established under the Plan.

5.02   Allocations with Respect to Dividends on Allocated Company Stock .

(a)   Participants.

(1) [Reserved]

(2) Notwithstanding anything in the Plan to the contrary, with respect to dividends paid on or after January 1, 2002 on Company Stock held in a Participant’s ESOP Account, each Participant (or in the event of the Participant’s death, to his Beneficiary) may elect, in accordance with uniform and non-discriminatory procedures adopted by the Administrative Committee, to (i) have such dividends directly paid to such Participant (or in the event of the Participant’s death, to his Beneficiary) as soon as administrative feasible following the payment of such dividend, (ii) be paid to the trust fund and distributed to the Participant (or in the event of the Participant’s death, to his Beneficiary) as soon as administrative feasible following the payment of such dividend but no later than 90 days after the end of the Plan Year in which the dividend is paid, or (iii) be paid to the Plan (in cash or Company Stock, as elected by the Company) and automatically reinvested in the Olin Common Stock Fund, all in accordance with Code Section 404(k) and guidance issued thereunder, and in such event the Company shall be entitled to deduct the amount of the dividends (but not any earnings on such dividends earned while in the Plan) subject to such election in the taxable year in which the dividend is paid or distributed.  On and after January 1, 2002, a Participant shall at all times be deemed vested in any dividends allocated to his ESOP Account, with respect to which he is offered the foregoing reinvestment election, whether or not he is then otherwise fully vested in his Account Balance under the terms of the Plan.

(i) Notwithstanding the foregoing, in accordance with IRS Notice 2002-2, such deduction shall also be available with respect to dividends paid by the Company to the ESOP portion of the Plan in 2001, if Participants are offered an election between reinvestment in Company Stock or distribution of the dividend and such election becomes irrevocable in 2002.

(ii) In order for the dividend reinvestment election to be effective:

(1) Participants must be given a reasonable opportunity before the dividend is paid or distributed from the ESOP portion of the Plan to make the election;

(2) Participants must have a reasonable opportunity to change their dividend reinvestment election at least annually; and

(3) if there is a change in the Plan terms governing the manner in which dividends are paid or distributed to Participants, Participants must be given a reasonable opportunity  to make an election under the revised Plan terms prior to the date on which the first dividend subject to the new Plan terms is paid or distributed.

(iii) No dividends paid or reinvested as provided for above shall be treated as annual additions under Code Section 415, or as Tax Deferred or Taxed Contributions subject to Code Sections 410(k), 402(g) or 401(m).

(3) With respect to dividends paid on Company Stock that are not part of a Participant’s ESOP Account, such dividends will be reinvested in the same manner as directed by the Participant with respect to his Tax Deferred Contribution Account.

5.03   Matching Contribution s.

(a)   Participants.

(1) Each Participating Employer shall allocate to eligible Active Participants from contributions sufficient to provide each such Participant (whether or not still employed by an Affiliated Company) with a Matching Contribution equal to 100% of the first $25 contributed on behalf of or by the Participant as a Tax Deferred Contribution or Taxed Contribution for each month plus 50% of the excess of such contributions over $25 for each month; provided, however, that the total amount of contributions used to determine the amount of the Matching Contribution may not exceed 6% of Compensation within such month.

The Company may elect to provide a different rate of Matching Contribution or no Matching Contribution for all or any group of Active Participants, provided however that a decrease in the rate of Matching Contributions may be made effective only prospectively as of the first day of the calendar month following approval of such decrease by the Company.  Notwithstanding the foregoing, the Plan’s Matching Contributions provisions shall not be applicable with respect to collectively bargained Employees of Monarch and its affiliates from and after the date of the acquisition of Monarch and its affiliates by the Company unless and until otherwise provided in the applicable collective bargaining agreement.  In no event will any Tax Deferred Contributions or Taxed Contributions be matched at greater than a 100% rate.  In the event that a Participant’s matched Tax Deferred Contributions or Taxed Contributions are distributed or returned to the Participant pursuant to Sections 3.01, 3.02 or 3.05, an amount equal to the Current Market Value of the related Matching Contribution (and earnings thereon) shall be forfeited by such Participant.  Notwithstanding anything in the Plan to the contrary, no Matching Contribution shall be made with respect to Tax Deferred and Taxed Contributions made by salaried Participants on and after January 1,2003.

The Matching Contribution shall be invested in the same manner as directed by the Participant with respect to his Tax Deferred Contribution Account, or in the same manner as directed by the Participant with respect to his Taxed Contribution Account, in the event he is not making contributions to a Tax Deferred Contribution Account..

5.04   Performance Matching Contribution s.  

(a)   Participants.

(1) Following the end of each Plan Year, each Participating Employer shall allocate to eligible Active Participants of that Participating Employer from contributions sufficient to provide each Participant who is employed by a Participating Employer or Affiliated Company on the last day of the preceding Plan Year with a Performance Matching Contribution equal to an additional 5% of such Participant’s matched Tax Deferred Contributions and matched Taxed Contributions for the preceding Plan Year, other than those contributions that are already matched at a 100% rate, for each ten million dollar increment of EVA for such year or period, up to a maximum EVA amount of $200 million, as shown in the schedule below.

5.05   Aegis Retirement Plan Contribution Allocations .  The Aegis Retirement Contributions made under Section 3.04 shall be allocated to the Aegis Retirement Contribution Accounts of eligible Aegis Active Participants following the end of each Plan Year with respect to which a contribution is made, in an amount equal to a percentage of their Compensation, based upon their length of service with Aegis and its Affiliated Companies, in accordance with the following formula:

5.06   Monarch Retirement Plan Contribution Allocations .  The Monarch Retirement Contributions made under Section 3.04 shall be allocated to the Monarch Retirement Contribution Accounts of eligible Monarch Active Participants following the end of each Plan Year with respect to which a contribution is made in the proportion that the Compensation of each such Participant bears to the total Compensation of all such eligible Monarch Participants. The amounts so allocated pursuant to this Section shall be invested in the same manner and percentages as the Monarch Participant’s other Participant-directed investments or, if the Participant has no other Participant Directed Investments, then in accordance with the Participant’s investment election with respect to his Monarch Retirement Contribution Account balance.  Monarch Participants’ Retirement Contribution Account balances may only be distributed upon a termination of service, death, disability, attainment of age 65, or retirement, and, except as otherwise expressly provided herein, are not available for withdrawal, in-service distribution or loans.  Notwithstanding the foregoing, effective as of September 1, 2002 or such later date as is administratively feasible, Monarch Participants may borrow from their Retirement Contribution Account balances in accordance with the provisions of Article IX of the Plan.

6.01   Participant Direction of Accounts .  The Administrative Committee is authorized and directed to maintain a program, to be administered in a uniform and non-discriminatory manner, whereby a Participant or, in the event of a Participant’s death, a Beneficiary may direct the investment of the Participant’s Account.  By virtue of such Participant directed investments, the Plan is intended to constitute a plan described in section 404(c) of ERISA and the final regulations issued thereunder.  As such, to the extent permitted by law, the Trustee, the Administrative Committee, the Investment Committee, the  Company, any Participating Employer, or any of its directors, officers, employees or agents shall be relieved of liability for any losses which are the direct and necessary result of investment instructions given by a Participant (or Beneficiary).  A Participant (or Beneficiary) shall not be deemed to be a plan fiduciary, however, by reason of the exercise of control over the investment of his Account

6.02   Investments in Company Stock .  Notwithstanding Section 6.01, above, the Investment Committee shall maintain as a Fund the Olin Common Stock Fund. Participants (or Beneficiaries) may, but are not required to, invest some portion or all of their Tax Deferred Contributions, Taxed Contributions and Company Contributions in such Olin Common Stock Fund.

6.03   Investment of Matching Contribution s and Performance Matching Contribution s.

(a)   Matching Contributions shall be made as provided under Section 3.04 and invested as provided under Section 5.03.  Dividends issued on Company Stock held in the ESOP Account shall be reinvested or distributed as provided under Section 5.02. Effective October 17, 2003, Matching Contributions invested in the Olin Common Stock Fund may be transferred to other Funds at the direction of the Participant (or Beneficiary).

(b)   Performance Matching Contributions shall be made as provided under Section 3.05 and invested as provided under Section 5.04.  Dividends issued on Company Stock held in the ESOP Account shall be reinvested or distributed as provided under Section 5.02. Effective October 17, 2003, Performance Matching Contributions invested in the Olin Common Stock Fund may be transferred to other Funds at the direction of the Participant (or Beneficiary).

(c)   If a Participant transferring employment to Primex Technologies, Inc. elected to transfer such Participant’s account balances to the Primex Plan as provided in Section 15.06(b) hereof, any Company preferred stock allocated to such Participant account balance was redeemed by the Company for units in the Olin Common Stock Fund prior to the dividend record date for the distribution of Primex Technologies, Inc. common stock occurring in connection with the spin-off of the Company’s aerospace and ordnance businesses.

6.04   Special Distribution Account .

(a)   Generally.  In the case of a distribution of stock and/or securities of a controlled corporation of the Company received on, or with respect to, the Company Stock as part of a spin off, split off, split up or other similar reorganization resulting in a corporate separation, the Trustee will retain such stock and cause to be credited to a “Special Distribution Account” established for each Participant under the Olin Common Stock Fund his proportionate number of shares of such stock as determined by the Trustee on the basis of the number of shares of Company Stock in such Participant’s account in the Olin Common Stock Fund on the record date of the distribution.  Notwithstanding the preceding sentence, the Trustee, in its discretion, may sell such stock and/or securities received on, or with respect to, the Company Stock held in the ESOP Account and reinvest such proceeds in Company Stock for the Participants’ Olin Common Stock Fund accounts if the Trustee determines that it is necessary to do so in order to retain the status of the ESOP as an employee stock ownership plan within the meaning of Section 4975(e)(7) of the Code.  In any event, however, the Trustee shall sell all other securities received as part of such distribution, and reinvest the proceeds thereof in Company Stock for the Participants’ Olin Common Stock Fund accounts.

(b)   Subsequent Corporate Transactions with Respect to Shares Held in Special Distribution Account. In the event any securities of a previously controlled corporation of the Company credited to a Participant’s Special Distribution Account shall thereafter, pursuant to a merger, consolidation or other reorganization involving the previously controlled corporation, be changed into, or become exchangeable for, securities of another corporation and/or cash, the Trustee will retain the securities of such other corporation and cause the same to be credited to such Special Distribution Account.  If shareholders of the previously controlled corporation shall be offered an election by such other corporation as to the securities and/or cash they may receive in such merger, consolidation or other reorganization, the Trustee will provide a similar election to each Participant, provided that if a Participant fails to exercise any such election afforded by the Trustee within the period of time required by the Trustee, then such election may be made by the Trustee on such basis as it deems appropriate.  In the event securities in a Special Distribution Account shall be the subject of a tender offer for cash and/or an exchange offer for securities of another corporation, the Trustee may accept such tender or exchange offer with respect to a Participant only if the Trustee has been authorized to do so by such Participant within the period of time required by the Trustee.  The Trustee will retain any securities of such other corporation received in an exchange offer and cause the same to be credited to such Special Distribution Account.  In the event that the securities of such other corporation shall carry the right of conversion into other securities, such right may be exercised only at the election of the Participant and shall not be a responsibility of the Trustee.  Upon any such conversion, such other securities shall be credited to the Participant’s Special Distribution Account.  All cash received by the Trustee in such merger, consolidation or other reorganization, or in such tender offer, or as a result of any securities received as part of such merger, consolidation or other reorganization and all dividends and other distributions on securities held in a Special Distribution Account, shall, except as stated above, be invested in the Olin Common Stock Fund.

(c)   [Reserved]

(d)   Shares Acquired in Connection with Arch Spin-off. In connection with the spin-off of the Company’s specialty chemical business, Participants’ account balances invested in the Olin Common Stock Fund were credited with a dividend in the form of Arch common stock.  As of the dividend record date, an Arch Common Stock Fund was established as a Fund under this Article Six of the Plan, and the Arch common stock dividend was credited to each Participant’s account in the form of units in the Arch Common Stock Fund.

(i)   Treatment of Arch Common Stock Fund with respect to Participants. With respect to Participants (or Beneficiaries), no new investment, whether in the form of employer or Participant contributions or transfers of existing account balances under the Plan, are be permitted in the Arch Common Stock Fund. All dividends paid on the Arch stock held in the Arch Common Stock Fund for the benefit of Participants (or Beneficiaries) are re-invested by the Trustee (i) effective before October 17, 2003, in  the Olin Common Stock Fund and (ii) effective on or after October 17, 2003, invested in the same manner as directed by the Participant with respect to his Tax Deferred Contribution Account.  Participants (or Beneficiaries) may retain their investment in the Arch Common Stock Fund.  Alternatively, prior to March 1, 2001, such Participants (or Beneficiaries) may (i) transfer that portion of their Arch Common Stock Fund balances that are attributable to their Tax Deferred Contributions and Taxed Contributions to any other Fund or Funds permitted from time to time under the Plan other than the Arch Common Stock Fund (or the Fund under the Plan that was invested primarily in Primex Technologies, Inc. common stock), and (ii) may transfer and re-invest that portion of the Arch Common Stock Fund balance that is attributable to Company Contributions only into the Olin Common Stock Fund.  On and after March 1, 2001, such Participants (or Beneficiaries) may transfer their entire Arch Common Stock Fund balances to any other Fund permitted under the Plan.

7.01   Vesting of Tax Deferred Contribution and Taxed Contribution Accounts .  Each Participant’s Tax Deferred Contribution Account and Taxed Contribution Account (including any earnings on such contributions) shall be fully vested at all times.

7.02   Vesting of Company Contribution Accounts .

(a)   The Company Contribution Account of each Active Participant who dies, incurs a Total and Permanent Disability, attains age 65 while in the employ of an Affiliated Company or enters Retirement shall be fully vested and nonforfeitable.

(b)   The Company Contribution Account of each Participant, shall be vested in accordance with the following schedule:

(c)   It is anticipated that a Participant may be transferred between and among the Company and Participating Employers or their Affiliated Companies, and in the event of any such transfer, the Participant involved shall not have his rights under the Plan adversely affected, but shall continue to be credited with his accumulated Years Vesting Service.

(d)   Notwithstanding the foregoing, the Company Contribution Account of each Participant who is defined as a Transferred Employee under Article IX of the Asset Purchase Agreement by and be