Filed by The Stanley Works
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: The Black & Decker Corporation
Commission File No.: 1-01553
2010 Management Meeting &
Integration Summit Update
Integration Summit Update
Topics Covered
• Strategy & Vision
• Culture
• Brand
• Integration
• SFS
• Q & A
STRATEGY
VISION
&
The Combined Company Vision
Comprehensive Global Product
Offerings
Offerings
Complementary Iconic Brands
Enhanced Core Strengths Of Each
Company
Company
Larger, Stronger Global Company
Shared Commitment To
Operational Excellence
Operational Excellence
Substantial Synergy Opportunities
A Powerful, Diversified Engine for Growth
Our Mission In 2010 Is Clear:
1. Integrate Companies Successfully - Exceed
Expectations
Expectations
8 Drive SFS - Hard & Fast
8 Avoid Distractions
2. Protect The Core Franchise
8 Be Prepared For Any Environment
3. Be Vigilant On Cost Control And Productivity
8 Achieve Operating Leverage If Growth Resumes
8 Protect Cash Flow And EPS If Growth Stagnates
4. Be Prepared To Ramp Up In A Higher Growth Scenario
8 Assess And Test Your Supply Chain Now
5. Operate With Agility, Courage & Common Sense
The Immediate Mission
Job One: Integrate Successfully While Focusing on Our Core
Ø Continue To Pursue Time
Tested Operational
Formula
Tested Operational
Formula
Ø Brand Support
Ø Innovative New
Product
Development
Product
Development
Ø 2-3+% Annual
Productivity
Productivity
Ø Utilize SFS For
Differentiated Service
Levels, Thus
Outdistancing
Competition
Differentiated Service
Levels, Thus
Outdistancing
Competition
Ø Pursue Small Bolt On
Acquisitions To Extend
Reach/Grow Share
Acquisitions To Extend
Reach/Grow Share
Ø Mechanical Security
(Globally)
(Globally)
Ø Electronic Security
(Globally)
(Globally)
Ø Healthcare
Ø Infrastructure
Ø Engineered Fastening
And
Continuously Strengthen
Core Business Portfolio
Growth Platforms
1.
2.
Shed Strategically
Impaired Assets
2a.
Our Strategy for Growth
Leverage $1B+ Annual Cash Flow To Evolve Portfolio
Quickly Into Higher Growth Areas
Quickly Into Higher Growth Areas
Ø China
Ø SE Asia
Ø Brazil / Latin
America
America
Ø Eastern Europe
Ø Middle East
3.
Drive Hard Into
Emerging Markets
Emerging Markets
Consistent Strategic Focus Emphasizing Profitable Growth, Asset Efficiency
Maintain Portfolio Transition Momentum
• Brand Is Meaningful (Stanley Or Sub-brand)
• Value Proposition Is Definable And Sustainable Through
Innovation
Innovation
• Global Cost Leadership Is Achievable
Be Selective and Operate In Markets Where:
• Building On Existing Growth Platforms
• Developing New Growth Platforms Over Time
Pursue Growth On Multiple Fronts Through:
Accelerate Progress Via Stanley Fulfillment System (SFS)
Strategic Framework
• Be A Consolidator Of The Tool Industry
• Increase Relative Weighting Of Emerging Markets
8
Financial Objectives (In Place Since 2004)
Sales Growth
Financial Performance
Dividend
Credit Rating
Ø 3-5% Organic
Ø 10-12% Total
Ø Mid-teens % EPS Growth
Ø FCF > Net Income
Ø ROCE in the range of 12-15%
Ø Continued dividend growth
Ø Upper tier investment grade
Long Term Objectives
Performance Consistent With Objectives
6 Keys to Success
Support Our Brands:
•Continue to strengthen
awareness with key
constituents
awareness with key
constituents
Institutionalize SFS:
•Further embed company-
wide business system across
the global enterprise
wide business system across
the global enterprise
Empower Our Teams:
•Recognize and reward
successful contributions to
our growth
successful contributions to
our growth
Strengthen the Core:
•Focus on exceeding
operational objectives in
every area of the business
operational objectives in
every area of the business
Transition the Portfolio:
•Continue driving portfolio
diversification
diversification
Integrate Successfully:
•Maintain best-of-the-best and
achieve “one company”
mentality quickly
achieve “one company”
mentality quickly
OUR
CULTURE
11
Elements evaluated through the culture survey
Angles measured
High aspirations
(desire to win)
External focus
Think like owners
Bias toward action
Teamwork &
empowerment
empowerment
Passion & commitment
High performance
values
values
Perception of own culture and each other
Cultural ideals for combined company
Leadership behaviors &
communication styles
communication styles
Decision roles & styles
Openness to change
People systems,
measures & incentives
measures & incentives
Working environment
Company personality
Foundational values
& personality
Survey Population
• Stanley MICP
employees
employees
85%
response
rate
response
rate
Executive Survey Conducted 12/09
12
Source: Stanley Black & Decker Culture Survey, December 2009 (N=617)
Stanley culture provides a strong foundation, which Black &
Decker can enhance and strengthen
Decker can enhance and strengthen
• Stanley and Black & Decker
share many more cultural
similarities than differences
share many more cultural
similarities than differences
- Very similar starting points,
relative to other integrations that
Bain has seen
relative to other integrations that
Bain has seen
- Employees at both companies
perceive themselves to have high-
performance cultures (relative to
Bain’s benchmarks)
perceive themselves to have high-
performance cultures (relative to
Bain’s benchmarks)
- Both companies have a large base
of satisfied employees
of satisfied employees
Strong, Shared Cultural Foundation
• The cultural “ideals” identified as
part of the survey are very
consistent across SWK and BDK
part of the survey are very
consistent across SWK and BDK
• The similarities across the two
cultures are prized; these should
be preserved and leveraged
cultures are prized; these should
be preserved and leveraged
• There are opportunities to even
further enhance the Stanley
Black & Decker culture going
forward
further enhance the Stanley
Black & Decker culture going
forward
13
Strongest characteristics of current cultures
• Pride in our
heritage
heritage
• Hard working, with
“can-do” attitude
“can-do” attitude
• Clear set of values
lived each day
lived each day
• Value new and
better methods
and ideas
better methods
and ideas
• Personal
accountability
accountability
Shared
Source: Stanley Black & Decker Culture Survey, December 2009 (N=617)
Stanley
• Results, not efforts
• Bias toward action
• Clearly articulated
vision for future
vision for future
• Ambitious goals
• High capacity for
change
change
• Strong operations
& finance base
& finance base
Black & Decker
• Collaborative, team
spirit; mutual trust
spirit; mutual trust
• Do the right thing,
not the easy thing
not the easy thing
• Give 100%, all of the
time
time
• Decentralized
decision making
decision making
• Customer focused
Cultures Shared and Complementary
14
• Heritage of the brands
• Clearly articulated vision for
the future
the future
• Work ethic and ‘can do’
attitude
attitude
• An empowered,
entrepreneurial spirit
entrepreneurial spirit
• Collaborative, not competitive
working environment
working environment
Preserve
Enhance
• Stronger focus on personal
accountability, with
consequences for missing goals
accountability, with
consequences for missing goals
• More receptivity to good ideas,
no matter who suggests them
no matter who suggests them
• Additional clarity on values
• Improved focus on the
customer
customer
• Increased emphasis on
celebrating success
celebrating success
Source: Stanley Black & Decker Culture Survey, December 2009 (N=617)
Stanley Black & Decker cultural ideals
Shared Cultural Ideals
15
Note: NAs excluded; 1=Strongly disagree, 2=Disagree, 3=Agree, 4=Strongly agree
“I'm excited to be part of this monumental
change for Stanley and Black & Decker
and to be part of this great challenge to
strengthen an already solid company.
change for Stanley and Black & Decker
and to be part of this great challenge to
strengthen an already solid company.
MICP 5 or 6, Stanley
“Overall, I believe that the merger makes
good business sense. My biggest
concern…is that Black & Decker will be
viewed as a single entity. Each part of
B&D truly operates independently. I hope
that as part of the integration process,
these differences and the unique benefits
of each B&D division are carefully
considered and maximized.
good business sense. My biggest
concern…is that Black & Decker will be
viewed as a single entity. Each part of
B&D truly operates independently. I hope
that as part of the integration process,
these differences and the unique benefits
of each B&D division are carefully
considered and maximized.
Director, Black & Decker
Is the merger in the best
interest of your company?
What are your thoughts on the merger
between Stanley and Black & Decker?
between Stanley and Black & Decker?
Percent of respondents who
agree or strongly agree
agree or strongly agree
Source: Stanley Black & Decker Culture Survey, December 2009 (N=617)
Strongly
agree
agree
Agree
Strongly
agree
agree
Agree
The Right Move
16
• It is common for partners to perceive
their cultures as different
their cultures as different
• Stanley and Black & Decker share far
more similarities than differences
more similarities than differences
• Integration effectiveness will depend
in part on how well the perceived and
actual cultural differences are
managed
in part on how well the perceived and
actual cultural differences are
managed
- Be aware and open regarding cultural
differences within your team
differences within your team
- Maintain an honest, frequent dialogue
within your team and encourage sub-
team members to do the same
within your team and encourage sub-
team members to do the same
- Communication of the cultural vision
will help minimize disruption
will help minimize disruption
The Road Ahead
OUR
BRANDS
• Awareness Among Professionals:
99%
99%
• Awareness Among DIYers: 93%
• Unaided awareness: +21%
increase since 2002.
increase since 2002.
• 99% overall brand awareness
• 80% of households own Black &
Decker
Decker
• 85% of Black & Decker owners are
satisfied with their products
satisfied with their products
Powerful Brands
AND
MORE
MORE
We Have the Strongest Brands and
Operate in Markets Where Brands Are Meaningful
Operate in Markets Where Brands Are Meaningful
Brand “Givens”
For Clarity, the Following are Brand Rules of Engagement:
• The Corporate Brand will be “Stanley Black & Decker”
• The Only Operating Units that will Adopt Stanley Black & Decker will be
Construction & DIY (CDIY) and Industrial and Automotive Repair
Construction & DIY (CDIY) and Industrial and Automotive Repair
• Hardware and Home Improvement will Merge with Stanley Hardware
• Combined Unit will Become Part of Stanley Mechanical Access Solutions
• All Divisional Product Brands WILL REMAIN INTACT and Under Control of Their
Business and Regional Leaders
Business and Regional Leaders
• This includes Stanley, DeWalt, Black & Decker, Facom, and all existing sub-brands
of both companies
of both companies
• These are valuable assets and there is no reason to change them
• Coordination, Guidance and Issue Resolution will be Administered by the Corporate
Brand Council, Under the Leadership of Scott Bannell
Brand Council, Under the Leadership of Scott Bannell
Respected Companies
Household Products
1. Fortune Brands
2. Tupperware Brands
3. Black & Decker
4. Energizer Holdings
5. Stanley Works
Together
We Should Be
#1
Where We Are - Corporate Branding
Design and produce
key communications
and launch materials
to be used on Day 1.
key communications
and launch materials
to be used on Day 1.
Develop new,
integrated corporate
brand positioning and
messaging strategy
integrated corporate
brand positioning and
messaging strategy
Develop visual identity
for the newly merged
parent company,
“Stanley Black &
Decker”
for the newly merged
parent company,
“Stanley Black &
Decker”
Quantitatively validate the
optimum corporate name
and brand strategy
(divisional branding,
endorsement branding,
over-branding, co-
branding, etc.) for the long
term.
optimum corporate name
and brand strategy
(divisional branding,
endorsement branding,
over-branding, co-
branding, etc.) for the long
term.
• Retained the services of
Lippincott - - a leading
global branding agency.
Lippincott - - a leading
global branding agency.
• Process is objective and
fact based
fact based
• Integrated identity and
brand positioning
brand positioning
(some Lippincott merger clients)
THE
INTEGRATION
Ensure that we focus the integration
process on key decisions to
minimize distractions to our base
business
process on key decisions to
minimize distractions to our base
business
Process
Integration Principles
•Overly complex, lengthy
process distracts
management
process distracts
management
•Decisions not made fast
enough, critical milestones
missed
enough, critical milestones
missed
•Integration lacks strong
leadership
leadership
•Customers defect in face
of uncertainty
of uncertainty
Base business
suffers
suffers
Integration
process fails
process fails
•Sources of value and risks
not clearly defined
not clearly defined
•Failure to prioritize most
critical sources of value
critical sources of value
•Synergy targets not
updated
updated
•Integration efforts not
launched prior to close
launched prior to close
•Poor hand-off to the line
Synergy targets
missed
missed
Failure to capture
incremental value
incremental value
Lose key
people
people
•Lured away by competitors
and headhunters
and headhunters
•Driven away by too much or
too little intervention
too little intervention
- Wait too long to get Newco
leadership in place, or
leadership in place, or
- “aggressive intervention”
approach without plan for
keepers
approach without plan for
keepers
•No plan to address
cultural issues
cultural issues
Talent departs
Potential Pitfalls
Detailed Functional &
BU Structures
BU Structures
Layers 3+:
Taskforce Driven Design
(3 to 6 month process)
(3 to 6 month process)
2
Tiers 3 and below
structure
structure
Decision-making
processes and roles
processes and roles
Location/use of shared
service centers
service centers
People selection process
(in conjunction with HR)
(in conjunction with HR)
Superstructure
Design
“Mega Decisions”
Top 3 layers:
CEO Driven Design
(Completed 60-120 days
post-announcement)
(Completed 60-120 days
post-announcement)
1
Tiers 1 & 2 structure
Governance committees
and charters
and charters
HQ location(s)
CEO direct reports
Role for the Center/
Shared Services
Best Practice: Org Design
High Level Org Structure for Stanley Black & Decker Defined
• Inevitably, transaction partners will perceive their
cultures as different. Usually the reality is much less
than the perception
cultures as different. Usually the reality is much less
than the perception
• Allowing the culture for the combined company to
naturally emerge does not usually lead to a high-
performance company
naturally emerge does not usually lead to a high-
performance company
• Awareness of cultural differences and communication of
“how things work” is half the battle
“how things work” is half the battle
• Strong executive leadership in communicating cultural
ideals is critical to ongoing success
ideals is critical to ongoing success
Strong foundational culture of Stanley enhanced by
unique aspects of Black & Decker
unique aspects of Black & Decker
Best Practice: Culture
27
Integration Best Practices-DRAFT4
Value:
Process:
People:
Objective:
• Capture “quick-win”
synergies
synergies
• Enable fundamental
interactions and Assure
regulation compliance
interactions and Assure
regulation compliance
• Clarify critical reporting lines
• Assure the two businesses
continue to operate
smoothly
continue to operate
smoothly
Develop stabilization plans
(initial priority)
• Rationalize full cost bases
• Integrate critical systems and
fully capture scale benefits
fully capture scale benefits
• Restructure key functions
• Fully combine the two
organizations
organizations
Develop integration plans
Strong track record of success with more than 50
transactions and experience with large-scale Facom deal
transactions and experience with large-scale Facom deal
Our Integration Approach
Steering
Committee
Committee
ITL Mtgs
IMO
1
Dec
7-8
7-8
2
Jan 19-21
(Miami)
6
Apr
21-22
21-22
12/21
4/8
4/14
4/29
12/17
1/13
1/27
2/8
2/17
4/13
4/28
Scheduled
Proposed
Primary workout
focus:
focus:
Agenda:
Feb 2-3
(New Britain)
Note: Items in red and italics address initiatives to support a March close
3
Dec 7-8
1
2
4
3
December
January
February
1/6
2/18
(Call)
2/9
(Call)
1/21
(Miami)
1/14
(Call)
Integration Calendar
Structured Meeting Rigor
1. Ensures All Issues Discussed
At Least Weekly
At Least Weekly
2. Alignment From Work Team
Level To Executive Office
Level To Executive Office
Initial
Integration
Plan to be
approved
March 11
Integration
Plan to be
approved
March 11
Working session
• Initiate joint SWK-BDK
integration planning
integration planning
• Relationship building
Trust the process and nail the
stabilization plan before closing
stabilization plan before closing
In Practice
Process
SFS
ONE BUSINESS SYSTEM
SFS Will Prepare The Company To Double In Size
Again In The Next 5 Years
Again In The Next 5 Years
Complexity
Management:
Eradicate complexity
in everything we do
Management:
Eradicate complexity
in everything we do
S&OP:
Tie the front-end
and the back-end to
the same number;
be agile
Tie the front-end
and the back-end to
the same number;
be agile
Transformational
Lean:
Utilize Lean to
change the game
Lean:
Utilize Lean to
change the game
Common
Platforms:
Migrate to a few
good systems
Platforms:
Migrate to a few
good systems
SFS: The Stanley Fulfillment System
• Integration is a catalyst to
drive complexity management
drive complexity management
• Connecting our sales
organizations with Global
Operations will allow us to
serve our customers better
than others
organizations with Global
Operations will allow us to
serve our customers better
than others
• Common platforms drive
efficiency and speed up
decision making
efficiency and speed up
decision making
• The combined organization
will have compelling scale to
drive transformational lean
will have compelling scale to
drive transformational lean
SFS Facilitates and Accelerates Integration
SFS: Imperative to Integration
33
The SFS Tools Are Familiar To The Black & Decker Team
Potential To Generate Significant Cash Flow
From Higher Working Capital Turns
From Higher Working Capital Turns
$300M+
• Black and Decker has been
utilizing many of the
principles of SFS
utilizing many of the
principles of SFS
• Opportunity exists to
globalize the process across
all Black & Decker units
globalize the process across
all Black & Decker units
• Combined scale creates
opportunity for even larger
results
opportunity for even larger
results
SFS: Will Drive Real Results
Integration Will Focus On People,
Process and Value…
Process and Value…
SFS Principles Will Be Core To The
Integration To Support A Larger,
More Diversified Company In The
Future
Integration To Support A Larger,
More Diversified Company In The
Future
SFS: The Stanley Fulfillment System
Q&A
Thank You.
Additional Information
The proposed transaction involving Stanley and Black & Decker will be submitted to the respective stockholders of Stanley and Black & Decker for their consideration. In connection with the proposed transaction, Stanley has filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that includes a preliminary joint proxy statement of Stanley and Black & Decker that will also constitute a prospectus of Stanley. Investors and security holders are urged to read the preliminary joint proxy statement/prospectus and any other relevant documents filed with the SEC (including the definitive joint proxy statement/prospectus) when they become available, because they contain important information. Investors and security holders may obtain a free copy of the preliminary joint proxy statement/prospectus and other documents (when available) that Stanley and Black & Decker file with the SEC at the SEC’s website at www.sec.gov and Stanley’s and Black & Decker’s website related to the transaction at www.stanleyblackanddecker.com. In addition, these documents may be obtained from Stanley or Black & Decker free of charge by directing a request to Investor Relations, The Stanley Works, 1000 Stanley Drive, New Britain, CT 06053, or to Investor Relations, The Black & Decker Corporation, 701 E. Joppa Road, Towson, Maryland 21286, respectively.
Certain Information Regarding Participants
Stanley, Black & Decker and certain of their respective directors and executive officers may be deemed to be participants in the proposed transaction under the rules of the SEC. Investors and security holders may obtain information regarding the names, affiliations and interests of Stanley’s directors and executive officers in Stanley’s Annual Report on Form 10-K for the year ended January 3, 2009, which was filed with the SEC on February 26, 2009, its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 20, 2009, and the preliminary joint proxy statement/prospectus related to the proposed transaction, which was filed with the SEC on January 15, 2010. Investors and security holders may obtain information regarding the names, affiliations and interests of Black & Decker’s directors and executive officers in Black & Decker’s Annual Report on Form 10-K for the year ended December 31, 2008, which was filed with the SEC on February 17, 2009, its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 16, 2009, and the preliminary joint proxy statement/prospectus related to the proposed transaction, which was filed with the SEC on January 15, 2010. These documents can be obtained free of charge from the sources listed above. Additional information regarding the interests of these individuals may also be included in the definitive joint proxy statement/prospectus regarding the proposed transaction when it becomes available.
Non-Solicitation
A registration statement relating to the securities to be issued by Stanley in the proposed transaction has been filed with the SEC, and Stanley will not issue, sell or accept offers to buy such securities prior to the time such registration statement becomes effective. This document shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of such securities, in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to appropriate registration or qualification under the securities laws of such jurisdiction.