Edgar Filing: BARNES GROUP INC

B 2014 Proxy Statement

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

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the Securities Exchange Act of 1934 (Amendment No. )

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BARNES GROUP INC.

(Name of Registrant as Specified In Its Charter)

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123 Main Street

Bristol, Connecticut 06010

March 27, 2014

NOTICE OF 2014 ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD MAY 9, 2014

You are invited to attend Barnes Group Inc.'s 2014 Annual Meeting of Stockholders on Friday, May 9, 2014 at the Hartford Marriott Downtown Hotel, 200 Columbus Boulevard, Hartford, Connecticut 06103, at 11:00 a.m., Eastern Daylight Time, for the following purposes:


1.	Election of directors;


2.	Ratify the selection of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2014;


3.	Advisory vote to approve our executive compensation;


4.	Approve the 2014 Barnes Group Inc. Stock and Incentive Award Plan; and


5.	Transact any other business that may properly come before the meeting.

Stockholders of record at the close of business on March 11, 2014 may vote at the meeting. The Board of Directors recommends a vote FOR all director nominees and FOR Items 2, 3 and 4.

Your vote is important. Whether or not you plan to attend the meeting, we encourage you to vote as promptly as possible by internet, telephone or mail.

Thomas O. Barnes

Chairman of the Board

Proxy Summary

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all information that you should consider, and you should read the entire proxy statement carefully before voting.

Barnes Group Inc. 2014 Annual Meeting of Stockholders



Friday, May 9, 2014		Hartford Marriott Downtown Hotel
11:00 a.m. Eastern Daylight Time		200 Columbus Boulevard
		Hartford, Connecticut 06103

Voting. Stockholders as of the record date, March 11, 2014, may vote. Each share of common stock of the Company is entitled to one vote for each director nominee and one vote for each of the proposals to be voted on.

Each stockholder’s vote is important. Please complete, sign, date and return your proxy or voting instruction form, or submit your vote and proxy by telephone or the Internet.

Meeting Agenda and Voting Recommendations



Item		Board Vote Recommendation	Page Reference

1	Election of 4 directors	For each director nominee	4
	Management Proposals
2	Ratification of PricewaterhouseCoopers as auditor for 2014	For	8
3	Advisory vote to approve our executive compensation	For	8
4	Approve the 2014 Barnes Group Inc. Stock and Incentive Award Plan	For	10
	Transact other business that properly comes before the meeting

Director Nominees (Item 1)

Each director nominee is elected for a one-year term by a plurality of the votes cast. All current directors attended at least 75% of the Board and committee meetings on which he or she served during 2013.

Name and Principal Occupation

Age

Director Since

Independent

Committee Memberships

William S. Bristow, Jr.

1978

• Executive (Chair)

President, W.S. Bristow & Associates, Inc.

• Finance

Patrick J. Dempsey

2013

• Executive (ex officio, non-voting)

President and Chief Executive Officer, Barnes Group Inc.

Hassell H. McClellan

2010

• Audit

Former Associate Professor of Finance and Policy, Boston College's Wallace E. Carroll School of Management

• Executive

• Finance

JoAnna Sohovich

Nominee

Global President, Industrial & Automotive Repair, Stanley Black & Decker, Inc.

Management Proposals


•	Ratify Auditor for 2014 (Item 2)

As a matter of good corporate governance, we are asking our stockholders to ratify the selection of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2014. Below is summary information regarding PricewaterhouseCoopers LLP's fees for services provided in 2013 and 2012.



Type of Fees	2013		2012

Audit Fees	$	3,411,000	$	2,035,782
Audit-Related Fees	$	600,725	$	691,549
Tax Fees	$	1,385,150	$	1,312,159
All Other Fees	$	1,818	$	3,636

Total Fees	$	5,398,693	$	4,043,126


•	Advisory Vote to Approve Our Executive Compensation (Item 3)

We are asking our stockholders to approve on an advisory basis our named executive officer (NEO) compensation. The Compensation Committee annually considers the results of the most recent advisory vote by stockholders to approve NEO compensation. In the 2013 advisory vote, 95.5% of the voted shares (81.31% of shares outstanding) supported the compensation of the Company's NEOs, and the Compensation Committee and the Board interpret this strong level of support as affirmation of the current design, purposes and direction of the Company's executive compensation program. The Board recommends a FOR vote because it believes that our compensation policies and practices are effective in achieving the Company's goals of rewarding for financial and operating performance, and aligning our NEOs’ interests with those of our stockholders.


•	Approve 2014 Barnes Group Inc. Stock and Incentive Award Plan (Item 4)

We are seeking approval of the 2014 Barnes Group Inc. Stock and Incentive Award Plan (the 2014 Plan). Long-term incentive compensation plays an integral part of the Company’s pay-for-performance strategy. Stock-based incentives enable the Company to attract, motivate and reward key employees and align

our employees' interests with those of our stockholders. The 2014 Plan is integral to the Company’s compensation strategies and programs, as the Board believes that the 2014 Plan will enhance the Company’s ability to attract and retain individuals of exceptional talent whose skills will assist in enabling the Company to continue to achieve sustainable, profitable growth.

If approved by stockholders, the Barnes Group Inc. Stock and Incentive Award Plan, as amended on March 15, 2010 (the Prior Plan) will be merged with and into the 2014 Plan. No further grants will be made under the Prior Plan, and shares with respect to all awards outstanding under the Prior Plan will be issued or transferred under the 2014 Plan. The terms of all awards outstanding under the Prior Plan will continue to apply to the awards outstanding under the Prior Plan.

The Board has unanimously approved the 2014 Plan, subject to stockholder approval at the Company’s 2014 annual meeting of stockholders.

Corporate Governance Highlights



Board of Directors

•	Substantial majority of independent directors (currently 8 of 10)
•	Declassified Board phase-in begins -- directors elected in 2014 to serve one-year terms
•	Majority voting policy - directors who receive more “withhold” than “for” votes in uncontested elections must offer to resign
•	Lead independent director with clearly established authority and responsibility over Board governance and operations
•	Independent Audit, Compensation and Corporate Governance Committees
•	Overall Board and committee meeting attendance of 99% in 2013
•	Annual evaluation processes for the Board and each of the standing committees
•	Regular executive sessions of Board and Committees without management present
•	A requirement in our Corporate Governance Guidelines that our directors attend director education programs and briefing sessions
•	Regular consideration of rotation of committee chairs and members, with a view towards balancing the benefits derived from continuity against the benefits derived from diversity of experience and viewpoints
•	Committee oversight and disclosure regarding political activities
•	Board risk management oversight with a focus on the most significant risks facing the Company
•	A requirement in our Corporate Governance Guidelines that a director may not simultaneously serve on the audit committees of more than three public companies, including that of the Company




Other Stockholder Interests

•	Eliminated certain supermajority voting provisions in 2013
•	Regular succession planning -- Board oversaw successful transition of CEO in 2013 with promotion of strong internal candidate that enabled leadership continuity
•	Long-standing executive and director stock ownership requirements
•	Stockholders hold right to call special meetings
•	Annual advisory vote to ratify independent auditor
•	Best practices in our executive compensation program noted below, including a clawback policy that applies to all NEOs and an annual advisory vote to approve executive compensation
•	The use by the Compensation Committee of a compensation consultant that does not provide services to management
•	Stockholder engagement and outreach to ensure that management and the Board understand and consider issues that matter most to our stockholders and enable us to address them effectively
•	A policy applicable to all executive officers that requires Corporate Governance Committee approval before accepting outside board membership with for-profit entities
•	A compliance hotline through which employees and other interested parties may communicate with the Board or raise concerns
•	Hedging transactions involving Company securities prohibited for directors and executive officers
•	Policy that prohibits Company leadership, including all directors and executive officers, from pledging or margin arrangements involving Company securities that are held to meet the Company's stock ownership requirements; other restrictions apply to pledging/margin arrangements for these individuals (see page 30); none of our NEOs has any pledging/margin call arrangements involving Company securities
•	Regular reviews of our Corporate Governance Guidelines by our Corporate Governance Committee and periodic updates in response to changing regulatory requirements, evolving practices, and issues raised by our stockholders and other stakeholders

Executive Compensation Highlights

We believe our executive compensation program provides an appropriate mix of elements to incent our executive officers to achieve business results while aligning their interests with those of our stockholders. Performance-based compensation in the form of annual and long-term incentives constituted over 75% and over 65% of 2013 total direct compensation for our CEO and other NEOs, respectively. As noted above, in 2013, our stockholders demonstrated strong support for our executive compensation program by approving it with over 95% of the voted shares.

iii

Executive Compensation Program - Summary of Key Elements



Type		Form		Terms

Equity	•	Annual grants in the form of 50% relative measure performance share awards (Relative Measure PSAs), 30% restricted stock units (RSUs) and 20% stock options
		• Stock options	•	Time-based vesting; 18, 30, and 42 months from the grant date in equal installments
		• RSUs	•	Time-based vesting; 18, 30, and 42 months from the grant date in equal installments
		• Relative Measure PSAs	•	Performance-based vesting at the end of a 3-year cycle; based on three equally weighted measures separately evaluated based on a comparison of the Company's relative performance against the performance of Russell 2000 Index companies
Cash	•	Salary	•	Base salaries are reviewed annually, and are typically increased at periodic intervals, often at the time of a change in position or assumption of new responsibilities
Cash	•	Annual incentive compensation	•	Stockholder-approved program with payouts based on accomplishment of targeted financial performance measures
			•	Annual incentive targets for our NEOs range from 45% to 75% of base salary at target level performance. Actual payouts may range from zero to three times target based on performance compared to our three performance measures
			•	For 2013 performance, actual payouts were 166% of target for NEOs paid on corporate results and 0% of target for one of our NEOs based on our Aerospace segment results
Retirement	•	NEOs participate in grandfathered qualified retirement programs generally available to the Company's US employees. NEOs also participate in a non-qualified retirement program that provides benefits on base salary earnings in excess of Internal Revenue Service (IRS) limit on qualified plans. Mr. Dempsey, Mr. Stephens, and Ms. Edwards also participate in grandfathered non-qualified executive retirement programs that have been closed to new entrants.
Change in control and severance	•	Severance payable and benefit continuation upon termination of employment in certain specified circumstances or upon a change in control
Change in control and severance	•	Severance ranges from a multiple of one times base salary plus pro rata bonus for certain non-change in control events under certain circumstances, to two times base salary plus pro rata bonus and additional benefits for certain change in control events
Perquisites	•	Financial planning and tax preparation services, annual physicals (for amounts not otherwise covered by health insurance), executive life insurance (with tax gross-up benefit for grandfathered participants only)

Executive Compensation Best Practices



•	Majority of direct compensation tied to performance, thereby aligning a significant portion of executive compensation payouts with stockholder return
•	Long-standing executive stock ownership requirements; CEO is required to own five times his salary
•	Capped incentive payouts
•	Clawback of incentive compensation



•	Compensation Committee is advised by an independent compensation consultant
•	No individual employment agreements for any currently employed NEO
•	“Double trigger” for accelerated vesting of all equity awards made after 2010 upon a change in control for all currently employed NEOs
•	No 280G gross-ups for a “golden parachute payment”

2013 NEO Compensation Summary



Name and Principal Position	Year	Salary		Bonus	Stock Awards		Option Awards		Non-Equity Incentive Plan Compensation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation		Total
Patrick J. Dempsey President and Chief Executive Officer	2013	$	700,000	—	$	1,588,668	$	371,030	$	881,567	$	253,304	$	123,261	$	3,917,830
	2012	447,783		—	565,484		124,787		250,988		364,266		104,764		1,858,072
	2011	427,250		—	274,901		122,836		646,500		378,554		74,451		1,924,492
Christopher J. Stephens, Jr. Senior Vice President, Finance and Chief Financial Officer	2013	453,585		—	875,508		135,805		382,238		10,912		165,604		2,023,652
	2012	431,000		—	1,339,261		130,546		240,390		49,038		234,870		2,425,105
	2011	427,250		—	340,131		150,549		646,500		36,337		218,575		1,819,342

Claudia S. Toussaint Senior Vice President, General Counsel and Secretary	2013	390,000		100,000	609,225		76,120		291,032		34,224		13,778		1,514,379
	2012	289,270		—	830,098		72,734		146,265		81,302		88,214		1,507,883
	2011	356,250		—	270,241		119,840		486,000		33,721		158,106		1,424,158

Dawn N. Edwards Senior Vice President, Human Resources	2013	296,000		—	488,327		64,010		220,886		—		80,568		1,149,791
	2012	296,000		—	269,177		60,474		148,585		102,683		133,699		1,010,618
	2011	292,250		—	223,648		101,115		399,600		73,928		117,334		1,207,875

Richard R. Barnhart Senior Vice President and President, Barnes Aerospace	2013	334,750		—	419,873		—		—		32,401		30,102		817,126



Gregory F. Milzcik Former President and Chief Executive Officer	2013	306,936		—	10,691,189		5,526,601		—		—		153,891		16,678,617
	2012	890,000		—	2,699,218		599,937		744,596		1,729,195		260,844		6,923,790
	2011	886,250		—	2,040,788		904,792		2,002,500		1,802,030		204,408		7,840,768

2015 Annual Meeting


•	Deadline for stockholder proposals for inclusion in the proxy statement for the 2015 Annual Meeting: November 27, 2014

PROXY STATEMENT FOR 2014 ANNUAL MEETING OF STOCKHOLDERS

TABLE OF CONTENTS



Internet Availability of Proxy Materials		1
Voting Information		1
Who Can Vote		1
Voting Your Shares		1
Revocation of Proxy		1
Quorum		2
Broker Non-Votes		2
Effect of Broker Non-Votes and Abstentions		2
Participants in the Barnes Group Inc. Retirement Savings Plan		2
Vote Required and Recommendations of the Board for Each Proposal		2
Proxy Solicitation and Document Request Information		3
Solicitation of Proxies		3
Stockholders Requesting Copies of 2013 Annual Report		3
Householding of Annual Meeting Materials		3
Other Matters		3
Proxy Proposals		4
Election of Directors (Item 1 on proxy card)		4
Ratify the Selection of PricewaterhouseCoopers LLP as the Company's Independent Registered Public Accounting Firm (Item 2 on proxy card)		8
Advisory Vote to Approve the Company's Executive Compensation (Item 3 on proxy card)		8
Proposal to Approve the 2014 Barnes Group Inc. Stock and Incentive Award Plan (Item 4 on proxy card)		10
Executive and Director Compensation		18
Compensation Discussion and Analysis		18
Compensation Committee Report		34
Risk Oversight and Assessment Policies and Practices		34
Summary Compensation Table for 2013, 2012 and 2011		34
Grants of Plan-Based Awards in 2013		39



Outstanding Equity Awards at Fiscal Year End		41
Option Exercises and Stock Vested		43
Pension Benefits		43
Nonqualified Deferred Compensation		47
Termination Provisions of Employment and Severance Arrangements		49
Potential Payments Upon Termination or Change in Control		52
Director Compensation in 2013		54
Securities Authorized For Issuance Under Equity Compensation Plans		57
Related Person Transactions		58
Stock Ownership		58
Security Ownership of Certain Beneficial Owners		58
Security Ownership of Directors and Executive Officers		59
Section 16(a) Beneficial Ownership Reporting Compliance		60
Corporate Governance		60
Director Independence		61
Board Leadership		62
Board Role in Risk Oversight		63
Process for Selecting Directors; Stockholder Recommended Director Candidates		63
Communication with the Board		64
Board of Directors and Committees		65
Audit Committee Matters		66
Audit Committee Report		66
Principal Accountant Fees and Services		67
Pre-Approval Policy and Procedures		67
Stockholder Proposals for 2015 Annual Meeting		68
Annex A		1

PROXY STATEMENT FOR 2014 ANNUAL MEETING OF STOCKHOLDERS

MAY 9, 2014

This proxy statement is being used in connection with the solicitation of proxies by Barnes Group Inc., which is referred to in this proxy statement as the “Company”, on behalf of the Board of Directors (the Board) for the 2014 Annual Meeting of Stockholders (2014 Annual Meeting) to be held on May 9, 2014 and at any adjournment thereof. Availability of this proxy statement and accompanying materials to stockholders is scheduled to begin on or about March 27, 2014.

INTERNET AVAILABILITY OF PROXY MATERIALS

In accordance with the rules of the Securities and Exchange Commission (the SEC), instead of mailing a printed copy of our proxy materials to each stockholder of record or beneficial owner, we are furnishing our proxy materials (proxy statement for the 2014 Annual Meeting, the proxy card and the 2013 Annual Report to Stockholders) by providing access to these materials on the internet. Stockholders will not receive printed copies of the proxy materials unless they request this form of delivery. Printed copies will be provided upon request at no charge.

A Notice of Meeting and Internet Availability of Proxy Materials (the Notice of Internet Availability) will be mailed to stockholders on or about March 27, 2014. We are providing the Notice of Internet Availability in lieu of mailing the printed proxy materials and instructing stockholders as to how they may: (1) access and review the proxy materials on the internet; (2) submit their proxy; and (3) receive printed proxy materials. Stockholders may request to receive printed proxy materials by mail or electronically by e-mail on an ongoing basis by following the instructions in the Notice of Internet Availability. A request to receive proxy materials in printed form by mail or by e-mail will remain in effect until such time as the submitting stockholder elects to terminate it.

VOTING INFORMATION

Who Can Vote

Only stockholders of record at the close of business on March 11, 2014 (the Record Date) will be entitled to vote at the 2014 Annual Meeting. As of March 11, 2014, the Company had 54,116,554 outstanding shares of common stock, par value $.01 per share (Common Stock), each of which is entitled to one vote.

Voting Your Shares

You can vote your shares either by proxy or in person at the 2014 Annual Meeting. If you choose to vote by proxy,

you can do so in one of three ways:


•	By internet. To vote using the internet, go to the website listed on your Notice of Internet Availability or proxy card. You will need to follow these instructions and those on the website.


•	By telephone. To vote by telephone, call the toll free number listed on your Notice of Internet Availability or proxy card. You will need to follow these instructions and the prompts from the telephone voting system.


•	By mail. If you requested printed proxy materials and wish to vote by mail, simply mark, sign and date the proxy card and return it in the postage-paid envelope provided.

If you vote by internet or telephone, you should not return your proxy card.

If you hold your shares through a broker, bank or other nominee, you will receive separate instructions from the nominee describing how to vote your shares.

Revocation of Proxy

A stockholder who executes and delivers a proxy may revoke it at any time before it is exercised by voting in person at the 2014 Annual Meeting, by delivering a subsequent proxy, by notifying the inspectors of the election in person or in writing or, if previous instructions were given through the internet or by telephone, by providing new instructions by the same means.

Quorum

For the business of the 2014 Annual Meeting to be conducted, a minimum number of shares constituting a quorum must be present. The holders of a majority of the outstanding shares of Common Stock entitled to vote at the 2014 Annual Meeting must be present in person or represented by proxy at the 2014 Annual Meeting to have a quorum. Shares represented at the meeting by proxies including abstentions and broker non-votes are treated as present at the meeting for purposes of determining a quorum.

Broker Non-Votes

A broker non-vote occurs when a stockholder who holds his or her shares through a bank or brokerage firm does not instruct that bank or brokerage firm how to vote the shares and, as a result, the broker is prevented from voting the shares held in the stockholder's account on certain proposals. Under applicable New York Stock Exchange (NYSE) rules, if you hold your shares through a bank or brokerage firm and your broker delivers the Notice of Internet Availability or the printed proxy materials to you, the broker has discretion to vote on “routine” matters only. Of the matters to be voted on as described in this proxy statement, only the ratification of the selection of our independent registered public accounting firm is considered "routine" and therefore eligible to be voted on by your bank or brokerage firm without instructions from you.

Effect of Broker Non-Votes and Abstentions

Abstentions and broker non-votes will not have an effect on the outcome of Item 1 (election of directors). In voting on Item 2 (ratification of auditor selection), Item 3 (approval of executive compensation), and Item 4 (approval of the 2014 Barnes Group Inc. Stock and Incentive Award Plan), abstentions will have the effect of votes against the proposals and broker non-votes will not have an effect on the outcome of the vote.

Participants in the Barnes Group Inc. Retirement Savings Plan

You must provide the trustee of the Barnes Group Inc. Retirement Savings Plan with your voting instructions in advance of the meeting. You may do so by returning your voting instructions by mail, or submitting them by telephone or electronically, using the internet. You cannot vote your shares in person at the 2014 Annual Meeting; the trustee is the only one who can vote your shares. The trustee will vote your shares as you have instructed. Except as otherwise required by law, if the trustee does not receive your instructions, the trustee will vote your shares in the same proportion on each issue as it votes those shares for which it has received voting instructions. To allow sufficient time for voting by the trustee, your voting instructions must be received by 11:59 p.m. Eastern Daylight Time (EDT) on May 4, 2014.

Vote Required and Recommendations of the Board for Each Proposal


•	Item 1, Election of directors.

Vote Required: Directors are elected by a plurality of the votes cast. Proxies may not be voted for more than the number of nominees named by the Board.

Recommendation: The Board recommends a vote “FOR” all nominees.


•	Item 2, Ratify the selection of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2014.

Vote Required: Affirmative vote of a majority of shares of Common Stock represented in person or by proxy and entitled to vote on the matter.

Recommendation: The Board recommends a vote “FOR” this proposal.


•	Item 3, Advisory vote to approve the Company's executive compensation.

Vote Required: Affirmative vote of a majority of shares of Common Stock represented in person or by proxy and entitled to vote on the matter. As noted in the discussion of this proposal, the results of this vote are non- binding on the Board or its Compensation and Management Development Committee (the Compensation Committee) and may be construed neither as overruling a decision by the Board or the Compensation

Committee nor as creating or implying any additional fiduciary duty on the Board. Further, it will not affect any compensation paid or awarded to any named executive officer as described in this proxy statement.

Recommendation: The Board recommends a vote “FOR” this proposal.


•	Item 4, Proposal to approve the 2014 Barnes Group Inc. Stock and Incentive Award Plan.

Vote Required: Affirmative vote of a majority of shares of Common Stock represented in person or by proxy and entitled to vote on the matter.

Recommendation: The Board recommends a vote “FOR” this proposal.

PROXY SOLICITATION AND DOCUMENT REQUEST INFORMATION

Solicitation of Proxies

Proxies will be solicited on behalf of the Board by mail, telephone, internet or other electronic means, and may also be made by the Company's officers and employees personally without additional compensation. The Company bears all solicitation costs. The Company may also reimburse brokers, dealers, banks, voting trustees or their nominees for their reasonable expenses in forwarding proxy materials to beneficial owners. The Company has retained Morrow & Co., LLC to aid in the solicitation of proxies for a fee of approximately $7,500 plus the cost of telephone solicitation, if applicable, and out-of-pocket expenses.

Stockholders Requesting Copies of 2013 Annual Report

Stockholders may request and we will promptly mail without charge a copy of the 2013 Annual Report by writing to: Manager, Stockholder Relations & Corporate Governance Services, Barnes Group Inc., 123 Main Street, Bristol, Connecticut 06010.

Householding of Annual Meeting Materials

Some banks, brokers, broker-dealers and other similar organizations acting as nominee record holders may be participating in the practice of “householding” proxy statements and annual reports. This means that only one copy of this proxy statement and the 2013 Annual Report may have been sent to multiple stockholders in your household. If you would prefer to receive separate copies of a proxy statement or annual report for other stockholders in your household, either now or in the future, please contact your bank, broker, broker-dealer or other similar organization serving as your nominee.

Upon written or oral request to Manager, Stockholder Relations & Corporate Governance Services, Barnes Group Inc., 123 Main Street, Bristol, Connecticut 06010, or via telephone to the Investor Relations department at (800) 877-8803, we will promptly provide separate copies of the 2013 Annual Report and/or this proxy statement. Stockholders sharing an address who are receiving multiple copies of this proxy statement and/or the 2013 Annual Report and who wish to receive a single copy of these materials in the future will need to contact their bank, broker, broker-dealer or other similar organization serving as their nominee to request that only a single copy of each document be mailed to all stockholders at the shared address in the future.

Other Matters

The Board does not know of any matters to be presented for consideration at the meeting other than the matters described in Items 1, 2, 3 and 4 of the Notice of 2014 Annual Meeting. However, if other matters are presented, it is the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their judgment. All shares represented by the accompanying proxy, if the proxy is given before the meeting, will be voted in the manner specified therein.

PROXY PROPOSALS

Election of Directors (Item 1)

The Board is currently divided into three classes. Previously, each of the classes was elected to serve three-year terms which were staggered such that one-third of the Board membership, or as near to one-third as possible, was elected at each annual meeting. At last year’s annual meeting, our stockholders approved amendments to our Amended and Restated Bylaws (Bylaws) to phase out the classification of the Board and to provide instead for the annual election of directors commencing with those directors up for election at our 2014 Annual Meeting. Directors previously elected to serve three-year terms will serve the remainder of their terms before standing for re-election.

Upon the recommendation of the Corporate Governance Committee, the Board has nominated William J. Bristow, Jr., Patrick J. Dempsey, Hassell H. McClellan and JoAnna Sohovich for election to the Board. The Board has determined that except for Mr. Dempsey, each nominee is an independent director as discussed below under “Director Independence.” If elected, each nominee will hold office until the 2015 Annual Meeting of Stockholders unless any of them earlier dies, resigns, retires or is removed, as provided in the Bylaws.

All nominees currently serve on the Board, except for Ms. Sohovich who was nominated by the Board in March 2014 to stand for election at the 2014 Annual Meeting. If elected, Ms. Sohovich would fill one of the vacancies that will be created by the retirement of two of our directors as of the date of the 2014 Annual Meeting.

In 2013, the Corporate Governance Committee engaged a third-party search firm, Diversified Search, to assist it with identifying and screening director candidates. As described in the "Process for Selecting Directors" section below, the Board has identified certain qualifications for its directors, and considers how a candidate represents, in combination with the other directors, a diversity of perspectives, viewpoints, backgrounds and experiences. The search firm was instructed to identify candidates based on the criteria specified by the Corporate Governance Committee. Ms. Sohovich was recommended as a nominee by the third-party search firm acting on behalf of the Corporate Governance Committee. After its review and evaluation of Ms. Sohovich's background and qualifications, the Corporate Governance Committee shared with the Board its perspectives regarding recommending Ms. Sohovich's nomination.

Ms. Sohovich's qualifications to serve on our Board include her extensive executive management and leadership experience, broad knowledge of the aerospace and transportation industries, her mix of public service and private industry experience, her leadership of global, multi-brand manufacturing businesses, and direct experience in driving innovation and strategic growth initiatives, as described in her biography below. The Corporate Governance Committee and the Board both believe that Ms. Sohovich's qualifications, skills and experiences would contribute to an effective and well-functioning Board capable of fulfilling its oversight responsibility and provide quality advice to the Company’s management.

The four nominees, the five directors continuing in office after the meeting, and the two directors who will be retiring from the Board as of the date of the 2014 Annual Meeting are listed below with brief biographies. Each director has been associated with his or her present organization for at least the past five years unless otherwise noted. None of the organizations listed as business affiliates of the directors is a subsidiary or other affiliate of the Company.

If a nominee for director should become unavailable for any reason, it is intended that votes will be cast for a substitute nominee designated by the Board. The Board has no reason to believe the persons nominated will be unable to serve if elected.

The Board recommends a vote "FOR" all nominees.

Nominees for Re-election - One-Year Term - Term to expire in 2015




	William S. Bristow, Jr.
	Age: 60	Committees:
	Director since: 1978	Executive (Chair)
	Current term expires: 2014	Finance


	Mr. Bristow is President of W.S. Bristow & Associates, Inc., which is engaged in small business development. Mr. Bristow's qualifications to be a member of our Board include his extensive knowledge of our Company with over 30 years of service as a member of our Board, ownership and direct management of W.S. Bristow & Associates and his expertise in the area of sales.




	Patrick J. Dempsey
	Age: 49	Committees:
	Director since: 2013	Executive (ex officio, non-voting member)
	Current term expires: 2014

	Mr. Dempsey was appointed the President and Chief Executive Officer of the Company in March 2013. Prior to this appointment, he served as the Company's Senior Vice President and Chief Operating Officer, and was responsible for oversight and direction of the Company’s global business segments, as well as working closely on the development and execution of the Company’s strategic plan. Mr. Dempsey joined the Company in October 2000 and has held a series of roles of increasing responsibility. He was appointed Vice President, Barnes Group Inc. and President, Barnes Aerospace in 2004, Vice President, Barnes Group Inc. and President, Barnes Distribution in October 2007, Vice President, Barnes Group Inc. and President, Logistics and Manufacturing Services in October 2002. Mr. Dempsey's qualifications to be a member of our Board include his extensive knowledge of the Company's business operations and his depth of experience in the fields of business management, enterprise management systems, business development and international operations.




	Hassell H. McClellan
	Age: 68	Committees:
	Director since: 2010	Audit
	Current term expires: 2014	Executive
		Finance

	Dr. McClellan retired in 2013 as an Associate Professor of Finance and Policy at Boston College's Wallace E. Carroll School of Management, where he served as the Associate Dean from 1996 to 2000. Dr. McClellan had been a member of the faculty of Boston College since 1984. He specializes in global competitiveness and strategic management for boards of directors and financial services, and has both an MBA and a Doctor of Business Administration degree. Dr. McClellan has served as trustee of the Virtus Variable Insurance Trust (formerly Phoenix Edge Series Fund) since 2008, and as trustee of both the John Hancock Variable Insurance Trust and John Hancock Funds II since 2005, and of John Hancock Funds and John Hancock Funds III since 2012. Dr. McClellan's qualifications to be a member of our Board include his extensive experience and expertise in global competitiveness, strategic planning and finance. In addition to his academic achievements in these areas, he has served as a board member or trustee of more than ten non-profit and private organizations.




	JoAnna Sohovich
	Age: 42	Committees:
	Director Nominee	None

	Ms. Sohovich is Global President, Industrial & Automotive Repair at Stanley Black & Decker, Inc. where she leads a multiple brand and channel global manufactured goods business. Before being appointed to this position in 2012, she served as Industrial & Automotive Repair President - North America, Asia and Emerging Regions since 2011. From 2002 to 2011, Ms. Sohovich served in several roles of increasing responsibility at Honeywell International, including President, Security & Communications from 2010 to 2011 emphasizing new product development and innovation, Vice President & General Manager, Commercial Building Controls from 2008 to 2010, leading growth initiatives across a broad commercial building controls portfolio, and Integration Leader from 2007 to 2008 resulting in Honeywell’s successful acquisition and integration of Maxon Corporation. Ms. Sohovich served as Vice President, Six Sigma for Honeywell from 2004 to 2005. Her earlier experience includes Plant Management, Repair and Overhaul Shop Management, Quality Management and service as an officer in the United States Navy. Ms. Sohovich’s qualifications to be a member of our Board include her extensive executive management and leadership experience, broad knowledge of industrial manufacturers, global mindset and direct experience in driving innovation and strategic growth initiatives.



Continuing Directors
Term expiring in 2015

	Thomas O. Barnes
	Age: 65	Committees:
	Director since: 1978	Executive (ex officio, non-voting member)
	Current term expires: 2015

	Mr. Barnes is Chairman of the Board and an employee of the Company. His role is described on page 56. From 2007 until 2012 he served as a director of New England Bank Shares, Inc. He served as a director of Valley Bank from 2005 to 2007 when it was merged into New England Bank Shares, Inc. Mr. Barnes' qualifications to be a member of our Board of Directors include his experience in the fields of distribution, manufacturing, finance and governance with numerous organizations throughout his career, including the Company's former distribution business. In addition, Mr. Barnes has owned and managed several businesses and has experience in the commercial lending field. He has served on the Board for over 30 years, has served as Chairman of our Board since 1995, and has served as chairman, trustee or director for over 20 non-profit organizations.




	Gary G. Benanav
	Age: 68	Committees:
	Director since: 1994	Audit
	Current term expires: 2015	Compensation and Management Development
		Corporate Governance (Chair)

	Mr. Benanav retired in March 2005 from New York Life International, LLC where he was the Chief Executive Officer from December 1997, and the Vice Chairman and a director of New York Life Insurance Company from November 1999. He has served as a director of Express Scripts Holding Company since January 2000, a full-service pharmacy benefit management company, and a director of Remeztech Ltd., a privately held software development company based in Israel, since 2013. Mr. Benanav's qualifications to be a member of our Board include having served as the executive officer of two U.S. corporations with assets in excess of $100 billion, extensive international business experience, extensive management responsibility for U.S. and international insurance and financial services companies, experience in dealing with regulators and legislators, extensive knowledge of finance and accounting matters including complex financial statement and accounting issues across various types of businesses, and practice as a business attorney for 15 years including serving as a legal advisor to boards of directors for over five years. In addition, Mr. Benanav received a Presidential appointment as U.S. representative to APEC Business Advisory Council (2002 to 2005).




	Mylle H. Mangum
	Age: 65	Committees:
	Director since: 2002	Audit
	Current term expires: 2015	Compensation and Management Development (Chair)
		Finance

	Ms. Mangum has served as Chief Executive Officer of IBT Enterprises, LLC, a leading provider of branch banking solutions, since October 2003. Prior to this, she served as the Chief Executive Officer of True Marketing Services, LLC since July 2002, focusing on consolidating marketing services companies. From 1999 to 2002, she was the Chief Executive Officer of MMS Incentives, Inc., a private equity company involved in developing and implementing marketing and loyalty programs in high-tech environments. She is currently a director of PRGX Global, Inc., Haverty Furniture Companies, Inc., and Express, Inc. She also served as a director of Collective Brands Inc., and its predecessor PaylessShoeSource, Inc., from 1997 to 2012, Scientific-Atlanta, Inc. from 1993 to 2006, Respironics, Inc. from 2004 to 2008, Matria Healthcare, Inc. from 2006 to 2008, and Emageon Inc. from 2004 to 2009. Ms. Mangum's qualifications to be a member of our Board include her current service as a chief executive officer, and extensive business and management experience including, in addition to that mentioned above, serving as an executive with General Electric, BellSouth and Holiday Inn Worldwide. She has extensive knowledge of marketing, accounting and finance, as well as compliance and internal controls.



Continuing Directors
Term expiring in 2016

	Francis J. Kramer
	Age: 64	Committees:
	Director since: 2012	Compensation and Management Development
	Current term expires: 2016	Corporate Governance

	Mr. Kramer is President and Chief Executive Officer and a member of the Board of Directors of II-VI Incorporated, a publicly traded company that is a global leader in engineered materials and optoelectronic components. He has served as a director of II-VI Incorporated since 1989, has been President since 1985, and was Chief Operating Officer from 1985 to 2007. He is a Board Advisor on the University of Pittsburgh's Swanson School of Engineering. Mr. Kramer's qualifications to be a member of our Board include his current service as a chief executive officer, and extensive experience in the fields of engineering, manufacturing, domestic and international operations, business development, strategic planning and extensive knowledge both domestically and internationally with acquisitions.



	William J. Morgan
	Age: 67	Committees:
	Director since: 2006	Audit (Chair)
	Current term expires: 2016	Corporate Governance
		Executive

	Mr. Morgan is a retired partner of the accounting firm KPMG LLP (KPMG) where he served clients in the industrial and consumer market practices. After his retirement in 2006, and until 2010, he was a consultant to KPMG's Leadership Development Group and Dean of KPMG's Chairman's 25 Leadership Development Program. He is the Audit Committee financial expert of our Board. From 2004 until 2006, Mr. Morgan was the Chairman of KPMG's Audit Quality Council and, from 2002 until 2006, he was a member of its Independence Disciplinary Committee. He previously served as the Managing Partner of KPMG's Stamford, Connecticut office. Mr. Morgan is currently a director of PGT, Inc. and JGWPT Holdings Inc. He previously served as a member of the Boards of Directors for KPMG and KPMG Americas. In addition to his service with KPMG and on other boards of directors, Mr. Morgan's qualifications to be a member of our Board include his 39 year career and expertise in the accounting and auditing fields as well as his extensive practice as a certified public accountant and experience working with global industrial companies relative to accounting, finance, auditing, controls, risk management, compliance and corporate governance.

Retiring Directors

Mr. Thomas J. Albani and Mr. John W. Alden, who have served as directors since 2008 and 2000, respectively, will be retiring from the Board as of the date of the 2014 Annual Meeting.



	Thomas J. Albani
	Age: 71	Committees:
	Director since: 2008	Compensation and Management Development
		Corporate Governance
		Finance

	Mr. Albani retired in May 1998 from Electrolux Corporation, a North American manufacturer and marketer of premium floor care products, where he served as the Chief Executive Officer for seven years and as a member of the Board of Directors. From 1994 to 2010, Mr. Albani was a director of Select Comfort Corporation. Mr. Albani's qualifications to be a member of our Board include his experience as the Chief Executive Officer of Electrolux Corporation, as well as his service as the Chief Operating Officer of Allegheny International, a multibillion dollar industrial conglomerate. He also has, through his experience in management consulting and participation in various industrial and consumer associations, strong strategic planning and problem solving skills and knowledge of the financial, environmental, legal and structural issues facing industrial companies.



	John W. Alden
	Age: 72	Committees:
	Director since: 2000	Compensation and Management Development
		Corporate Governance
		Finance (Chair)

	Mr. Alden retired in 2000 as Vice Chairman, United Parcel Service of America, Inc. From 1988 until his retirement, he served as a director of United Parcel Service. He is currently, and has been during the past five years, a director of Silgan Holdings Inc., The Dun & Bradstreet Corporation and Arkansas Best Corporation. In addition to his service with United Parcel Service of America, Inc. and on other boards of directors, Mr. Alden's qualifications to be a member of our Board include his extensive experience as senior manager and vice chairman of a $50 billion company with responsibility for corporate strategic planning, worldwide marketing, sales, communications, public relations and logistics, and a life-long career in industry.

Ratify the Selection of PricewaterhouseCoopers LLP as the Company's Independent Registered Public Accounting Firm (Item 2)

The Audit Committee of the Board has selected PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for the fiscal year ended December 31, 2014. Although not required by the Company's Charter or Bylaws, the Company has determined to ask stockholders to ratify this selection. A representative of PricewaterhouseCoopers LLP is expected to be present at the meeting, have the opportunity to make a statement, if desired, and be available to respond to appropriate questions.

The Board recommends a vote “FOR” this Proposal.

Advisory Vote to Approve the Company's Executive Compensation (Item 3)

As part of our commitment to high standards of governance and under SEC rules, we seek our stockholders' advisory (non-binding) vote on the compensation of our NEOs, as described in the Compensation Discussion and Analysis (CD&A), the compensation tables, and the accompanying narrative disclosure regarding NEO compensation. This advisory proposal, known as a “say-on-pay” vote, gives stockholders the opportunity to vote whether or not to approve the compensation of our NEOs as described in this proxy statement. We recognize the

interest our stockholders have in the Company’s executive compensation program. As such, we currently hold an annual say-on-pay vote.

The Company's executive compensation program is designed to attract, engage and retain highly qualified executive officers. The Company has a strong pay-for-performance philosophy and, as a result, the compensation paid to our NEOs is closely aligned with the Company's performance on both a short-term and a long-term basis. For 2013, our executive compensation program for our NEOs was designed to reward positive performance with respect to the following financial performance measures: basic earnings per share (EPS), consolidated revenue, and consolidated operating margin, as well as the Company's performance over a three-year period ending December 31, 2015 relative to the performance of companies included in the Russell 2000 Index. These 2013 performance measures were designed to align our executive compensation program with our two key strategic goals for 2013: profitable sales growth, both organically and through acquisition, and productivity improvements.

The Company aims to provide our NEOs with the opportunity to earn total direct compensation that is targeted in a range around the median compared to a defined peer group of companies.

Our compensation mix for 2013 continued to provide total target direct compensation for our NEOs that generally falls in a range around the median compared to a defined peer group of companies, and other external sources are used to inform the Compensation Committee generally about the external market value of our executive roles. We believe our compensation mix provides sufficient incentives in the form of annual cash incentive awards and long-term incentive awards to drive the Company's performance and enhance stockholder value. Specifically, if the Company's performance meets or exceeds pre-established performance targets, including achieving performance levels at or above the 50^th percentile on a relative basis compared to the performance of Russell 2000 Index companies, and/or our stock price increases, the NEOs have an opportunity to realize significant additional compensation in the form of annual cash incentive awards and long-term equity awards. If the Company's performance does not meet pre-established performance targets, including reaching performance levels below the 50^th percentile on a relative basis compared to the performance of Russell 2000 Index companies, and/or our stock price declines, the NEOs have significant downside financial risk.

We have also implemented certain policies and guidelines regarding our executive compensation program designed to mitigate risk as described in our CD&A and highlighted below:


•	We have stock ownership requirements for our NEOs set at five times base salary for our Chief Executive Officer and three times base salary for all other NEOs.


•	All NEOs are subject to clawback agreements.


•	Our performance targets are tied to multiple financial metrics.


•	Our equity awards are structured to provide for “double trigger” accelerated vesting upon a change in control.


•	Our long-term compensation program uses several different types of equity awards to reward performance and encourage retention.


•	We place caps on payouts under our annual and long-term incentive programs.

We encourage stockholders to review the CD&A starting on page 18 which provides a detailed discussion of the executive compensation program in place for our NEOs.

The Compensation Committee annually considers the results of the most recent advisory vote by stockholders to approve NEO compensation. In the 2013 advisory vote, 95.5% of the voted shares supported the compensation of the Company's NEOs, and the Compensation Committee and the Board interpret this strong level of support as affirmation of the current design, purposes and direction of the Company's executive compensation program.

This vote will not be binding on the Board or the Compensation Committee and may not be construed as overruling a decision by the Board or the Compensation Committee nor create or imply any additional fiduciary duty on the Board. Further, it will not affect any compensation paid or awarded to any NEO. Because we highly value the opinions of our stockholders, however, the Board and the Compensation Committee will take into account the results of this say-on-pay vote when considering future executive compensation arrangements.

Accordingly, stockholders are being asked to approve the following resolution:

“RESOLVED, that the stockholders of the Company approve the compensation paid to the named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis and the tabular disclosures regarding named executive officer compensation, together with the accompanying narrative disclosure, in this proxy statement for its 2014 Annual Meeting.”

The Board recommends a vote “FOR” the approval of the advisory resolution to approve the compensation paid to the NEOs, as disclosed pursuant to Item 402 of Regulation S-K, including the CD&A and the tabular disclosures regarding NEO compensation, together with the accompanying narrative disclosure, in this proxy statement for its 2014 Annual Meeting.

Proposal to Approve the 2014 Barnes Group Inc. Stock and Incentive Award Plan (Item 4)

The Company is seeking approval of its 2014 Barnes Group Inc. Stock and Incentive Award Plan (the “Plan”

or the “2014 Plan”), as adopted by unanimous approval of our Board on February 12, 2014, subject to stockholder approval. Stockholder approval is being sought (i) in order to meet the NYSE listing requirements, (ii) so that compensation attributable to grants under the Plan may qualify for an exemption from the deduction limit under Section 162(m) of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (the “Code” or the “Internal Revenue Code”) (see discussion of “Federal Income Tax Consequences of the Plan” below), and (iii) in order for incentive stock options to meet the requirements of the Code.

Introduction

Long-term incentive compensation plays an integral part in the Company’s pay for performance strategy.

The Plan serves two primary purposes. First, it provides competitive incentives that enable the Company to attract, motivate and reward persons who render services that benefit the Company or its subsidiaries. Second, the Plan aligns the long-term economic interests of such persons directly with the interests of the Company’s stockholders. The Plan is integral to the Company’s compensation strategies and programs, as the Board believes that the Plan will enhance the Company’s ability to attract and retain individuals of exceptional talent whose skills will enable the Company to continue to achieve sustainable, profitable growth.

We currently maintain the Barnes Group Inc. Stock and Incentive Award Plan, as amended on March 15, 2010 (the “Prior Plan”). The total number of shares remaining available for issuance under the Prior Plan as of December 31, 2013, is 1,541,914 shares. The Board has determined that the number of shares of Common Stock currently available for issuance or transfer under the Prior Plan is not sufficient in view of our compensation structure and strategy. Our Board believes it is advisable to adopt a new comprehensive incentive compensation plan which will serve as the successor incentive compensation plan to the Prior Plan and provide the Company with an omnibus plan to design and structure grants of stock options, stock units, stock awards, stock appreciation rights and other stock-based awards for selected individuals in our employ or service. Our Board believes that the availability of 7,616,477 shares, which equals 6,074,563 new shares plus 1,541,914, the number of shares available for issuance under the Prior Plan as of December 31, 2013, will ensure that we continue to have a sufficient number of shares available to achieve our compensation strategy. The 7,616,477 shares will be reduced (i) for each share of Common Stock subject to a stock option or stock appreciation right granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 1:1, and (ii) for each share of Common Stock subject to a stock-based award (other than an option or stock appreciation right) granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 2.84:1.

When analyzing the number of new shares that should be available under the 2014 Plan, the Board considered a number of factors including the number of shares available under the Prior Plan, the full dilution level for the Company’s investors based on the total shares available for grant under the 2014 Plan (including the Prior Plan) and the Company’s projected three year burn rate, which is projected to be significantly less than the mean of the Company’s industry group. The Company determines its annual burn rate by taking the sum of the number of stock options granted and full value shares awarded (applying a premium to full value shares based on the Company’s annual stock price volatility) during the year, divided by the Company’s weighted average common shares outstanding during the year. The Board believes that our interests and the interests of our stockholders will be advanced if we can continue to offer our employees, notably at the senior management level, the opportunity to acquire or increase their proprietary interests in us.

If the 2014 Plan is approved by our stockholders, then the Prior Plan will be merged with and into the 2014 Plan, no further grants will be made under the Prior Plan, and shares with respect to all awards outstanding under the Prior Plan will be issued or transferred under the 2014 Plan. The terms of all awards outstanding under the Prior Plan will continue to apply to the awards outstanding under the Prior Plan.

For purposes of determining the number of shares that will be available for issuance under the 2014 Plan, if approved by our stockholders, the 7,616,477 shares will be reduced as set forth above as follows (i) for each share of Common Stock subject to a stock option or stock appreciation right granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 1:1, and (ii) for each share of Common Stock subject to a stock-based award (other than an option or stock appreciation right) granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 2.84:1.

As of December 31, 2013 under the Prior Plan, the following awards were outstanding or available for issuance:


•	Stock options were outstanding with respect to 1,516,341 shares of Common Stock with a weighted average exercise price of $20.65 per share and a weighted average remaining term of 4.61 years;


•	Full value awards, including restricted stock awards and performance awards based on our estimated payout, were outstanding with respect to 1,013,993 shares of Common Stock; and


•	1,541,914 shares remained available for issuance with respect to future awards.

If approved by our stockholders, the 2014 Plan will become effective on May 9, 2014.

The material terms of the 2014 Plan are summarized below. A copy of the full text of the 2014 Plan is attached to this Proxy Statement as Annex A. This summary of the 2014 Plan is not intended to be a complete description of the 2014 Plan and is qualified in its entirety by the actual text of the 2014 Plan to which reference is made.

General Description of the Plan

The Plan permits the issuance of incentive awards, stock option grants and stock appreciation rights (“SARs”). The foregoing are collectively referred to as “Awards.” Awards may include, but are not limited to, dividend equivalents, performance share awards, performance unit awards, restricted stock awards, restricted stock unit awards, or other stock-based awards (each as described below). Any Award may be linked to another Award, and linked Awards may be granted as either alternatives or supplements to each other. Under the Plan, the Company may issue Awards that qualify as performance-based compensation under Section 162(m) of the Code that is exempt from the $1 million limit on corporate tax deductions for named executive officer pay (“Performance-Based Compensation”) as well as Awards that do not so qualify.

Eligibility. Those eligible for Awards under the Plan are referred to below as “Participants.” Participants include any person who renders or has rendered services that benefit or will benefit the Company or one of its subsidiaries (each, a “Service Provider”). A Service Provider may be an employee, director, independent contractor, agent, advisor, consultant, representative or otherwise, provided, that, the consultants and advisors must perform bona fide services for the Company or one of its subsidiaries.

Shares Available for Issuance. The Plan authorizes a number of shares of Company Common Stock for issuance of 7,616,914 shares, reduced (i) for each share of Common Stock subject to a stock option or stock appreciation right granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 1:1, and (ii) for each share of Common Stock subject to a stock-based award (other than an option or stock appreciation right) granted after December 31, 2013 under the Prior Plan, on the basis of a fixed ratio of 2.84:1, in all instances, subject to adjustment as described below. The number of shares of Common Stock reserved for Awards under the Plan will be reduced by a fixed ratio of 1:1 shares of Common Stock subject to an Option (defined below) or SAR granted and shall be reduced by a fixed ratio of 2.84:1 shares of Common Stock for each share of Common Stock subject to a Performance Share Award, Performance Unit Award, Restricted Stock Award, Restricted Stock Unit Award, Dividend Equivalent or Other Stock-Based awards granted under the Plan.

Substitution and Assumption of Awards. If, in connection with an acquisition by the Company or a merger of another company with the Company, the Company assumes the other company’s outstanding stock incentive awards or substitutes new awards for the other company’s outstanding stock incentive awards, any shares the Company issues pursuant to such assumed or substituted awards will not count against the shares available for

issuance under the Plan.

Reusage. If and to the extent Awards granted under the Plan (or, after December 31, 2013, awards granted under the Prior Plan) terminate, expire, are cancelled, or are forfeited, the shares reserved for such Awards will become available again for purposes of the Plan. If shares otherwise issuable under the Plan (or the Prior Plan) are withheld or surrendered for payment of taxes, other than an Option or SAR (or, after December 31, 2013, any stock-based award other than an option or a stock appreciation right under the Prior Plan), then such number of tendered or withheld shares of Common Stock shall again be available for Awards under the Plan. If any Awards are paid in cash, and not in shares of our Common Stock, any shares of our Common Stock subject to such Awards will also be available for future Awards.

Any shares that again become available for Awards under the Plan pursuant to the foregoing shall be added to the shares authorized for grant under the Plan: (i) at a fixed ratio of 1:1 for each share of Common Stock subject to an Appreciation-Only Award (or options or stock appreciation rights granted under the Prior Plan) and (ii) at a fixed ratio of 2.84:1 shares of Common Stock for each share of Common Stock subject to a Performance Share Award, Performance Unit Award, Restricted Stock Award, Restricted Stock Unit Award, Dividend Equivalent or Other Stock-Based awards granted under this Plan (or similar stock-based awards under the Prior Plan).

Notwithstanding the foregoing, the following shares of Common Stock shall not be added to the shares authorized for grant under the Plan: (i) shares tendered by the Service Provider or withheld by the Company in payment of the purchase price of an Option or, after December 31, 2013, an option under the Prior Plan, (ii) shares tendered by the Service Provider or withheld by the Company to satisfy any tax withholding obligation with respect to Options or SARs or, after December 31, 2013, options or stock appreciation rights under the Prior Plan, (iii) shares subject to a SARs or, after December 31, 2013, a stock appreciation right under the Prior Plan that are not issued in connection with its stock settlement on exercise thereof, and (iv) shares reacquired by the Company on the open market or otherwise using cash proceeds from the exercise of Options or, after December 31, 2013, options under the Prior Plan.

Award Limits. The Plan provides that the maximum aggregate number of shares of Common Stock with respect to which Awards may be made to any individual during any calendar year is 1,000,000 shares, subject to adjustment in certain circumstances as described below. The maximum amount that may be paid to a Service Provider during any calendar year pursuant to a cash denominated Award, including performance-based compensation, is $5,000,000 or, if such Award is settled in shares of Common Stock, the fair market value of the Common Stock as of the applicable vesting date. The maximum aggregate number of shares of Common Stock with respect to which all Awards of incentive stock options that may be made under the Plan shall be 3,000,000 shares, subject to adjustment in certain circumstances as described in the Plan. The individual limits under the Plan apply without regard to whether the Award is paid in Common Stock or money and will be applied to Awards using a fixed ratio of 1:1.

Administration. The Plan is administered by the Compensation Committee. The Committee satisfies the requirements that the Plan be administered by a committee that is comprised of at least two members, each of which must be (i) an “independent director,” as defined in applicable rules or listing standards of the NYSE; (ii) a “non-employee director,” as defined in Rule 16b-3 under the Securities Exchange Act of 1934; and (iii) an “outside director,” as defined in Treasury Department regulations for purposes of Section 162(m) of the Code. The Committee may, under certain circumstances, delegate any or all of its authority and responsibility to (a) another committee of the Board to which the Board delegates such authority or responsibility, (b) the Chief Executive Officer of the Company, or (c) the chairperson of the committee to whom the Board delegates such authority or responsibility. This Committee may also delegate authority to the General Counsel of the Company or his or her designee as it relates to specific legal requirements and interpretations under the Plan. All such delegated authority or responsibility shall be limited to the ability to grant Awards to employees or other Service Providers who are not officers or directors of the Company and are not “covered employees” within the meaning of Section 162(m) of the Code. The Committee has exclusive power to:


•	select eligible persons to participate in the Plan,


•	determine the time when Awards will be made to eligible persons,


•	determine the nature and extent of Awards to be made to each Participant,


•	determine the duration of restriction periods and performance periods,


•	determine the terms and conditions to which payment of Awards may be subject, including the exercise price, in the case of an Option or SAR, and whether or not Awards are to be linked to each other and if so, whether they are alternative to or supplement to one another,


•	establish performance goals for each performance period, and


•	determine whether or not a specific Award is intended to qualify as performance-based compensation.

In addition, the Committee has the authority to establish, revise and revoke all rules and regulations relating to the Plan, to interpret and construe the Plan and to make determinations with respect to the Plan that it considers to be necessary or advisable for the administration of the Plan.

Awards.

Options. The Plan authorizes the grant of Options to purchase Common Stock which may be either incentive stock options (“ISOs”) or non-qualified stock options (“NSOs”). ISOs and NSOs are collectively referred to as “Options.” ISOs must comply with Section 422 of the Code and may only be granted to employees of the Company or one of its subsidiaries.

Each ISO granted pursuant to the Plan must have an exercise price that is not less than the fair market value of the Common Stock underlying such ISO at the time of the grant (or not less than 110% of the fair market value in the case of ISOs that are granted to Participants, if any, who are holders of more than 10% of the Company’s Common Stock). Each NSO granted pursuant to the Plan must have an exercise price that is not less than 100% of the fair market value of a share of Common Stock at the time of the grant.

At the time Options are granted, the Committee shall determine when Options are exercisable and when they expire. However, the term of an Option cannot exceed 10 years from the date of grant (or five years from the date of the grant in the case of ISOs that are granted to Participants, if any, who are holders of more than 10% of the Common Stock).

Generally, for purposes of the Plan, fair market value means (unless the Committee determines otherwise with respect to a particular Award or the principal trading market for the Common Stock ceases to be a national securities exchange) the last reported sale price of Common Stock during regular trading hours on the date of the Award or, if there were no trades on that date, the last reported sale price of Common Stock during regular trading hours on the latest preceding date upon which a sale was reported.

The consideration to be received by the Company for the grant of Options under the Plan may consist of future services, past services, or money or other property, tangible or intangible, as the Committee may determine. Payment for shares purchased upon exercise of an Option must be made in full at the time of exercise. Payment may be made in cash or, if provided for in the Option grant, and subject to applicable law, by any of the following methods or a combination thereof:


•	the transfer to the Company of shares owned by the Participant or purchased on the open market, having a fair market value on the date of transfer equal to the exercise price;


•	the delivery to the Company of a properly executed exercise notice together with a copy of irrevocable instructions to a broker to sell immediately some or all of the shares acquired by the exercise of the Option and to deliver promptly to the Company an amount of the sale proceeds (or, in lieu of or pending a sale, loan proceeds) sufficient to pay the purchase price; or


•	the election to have the Company retain some of the shares that would otherwise be issued pursuant to the Option exercise, having a fair market value on the date of exercise equal to the exercise price.

In addition, the Committee may authorize any other manner of payment, so long as such method complies with all applicable laws and the NYSE listing standards. However, the Committee may not reduce the exercise price of any outstanding Option, except as discussed under “Adjustments,” below.

SARs. The Committee may grant SARs to Participants, and determine the number of SARs, the term of the SARs, the time or times at which the SARs may be exercised, and all other terms and conditions of the SARs. Each SAR entitles the Participant to receive, upon exercise of the SAR, without payment to the Company by the Participant, an amount, payable in shares, cash or a combination of shares and cash, that is equal to the excess of:


•	the per share fair market value of the Common Stock on the date of exercise; over


•	the exercise price of the SAR.

SARs may be linked to Options under the Plan. Such SARs may be either a supplement or an alternative to the linked Options. SARs may also be issued as stand-alone Awards. For stand-alone SARs and SARs linked as a supplement to an Option, the exercise price shall be the fair market value of the Common Stock on the date of grant of the SARs. For SARs linked as an alternative to the related Option, the exercise price shall be the same as the exercise price of the related Option. The consideration to be received by the Company for the grant of SARs under the Plan may consist of future services, past services, or money or other property, tangible or intangible, as the Committee may determine.

Incentive Awards. The Plan authorizes the grant of Incentive Awards in lieu of, or as a supplement to, any other compensation that may have been earned by a Service Provider. In general, the Committee determines all of the terms and conditions of Incentive Awards including whether they will be contingent upon completion of a period of service after the grant of the Awards or on achievement of a performance goal, and whether any transfer restrictions will apply to shares of Common Stock issued pursuant to Incentive Awards. The amount of an Incentive Award may be based upon a specified number of shares of Common Stock or the fair market value of a specified number of shares or a dollar amount authorized by the Committee. Any Incentive Award may be paid in cash or shares of Common Stock, or a combination of cash and shares. Forms of Incentive Awards include, but are not limited to, Dividend Equivalents, Performance Share Awards, Performance Unit Awards, Restricted Stock Awards, Restricted Stock Unit Awards, and Other Stock-Based Awards.

Dividend Equivalents. Dividend Equivalents are the right to receive an amount of money equal to the dividends paid from time to time on a specified number of shares of Common Stock. Dividend Equivalents may be paid in the form of money or shares of Common Stock based on their fair market value on the payment date, or any combination of cash and shares. To the extent Dividend Equivalents are paid on a Performance Share Award or Performance Unit Award, the Dividend Equivalent will not be paid until the applicable performance goals are achieved.

Performance Share and Performance Unit Awards. A Participant who is granted a Performance Share Award has the right to receive shares or cash or a combination of shares and cash equal to the fair market value of such shares at a future date in accordance with the terms of such grant and upon the attainment of performance goals specified by the Committee. The award of Performance Shares to a Participant does not create any rights in such Participant as a stockholder of the Company until the issuance of the shares with respect to an Award. A Participant who is granted a Performance Unit Award has the right to receive a specified dollar amount upon the attainment of performance goals specified by the Committee. The Committee may substitute actual shares of Common Stock for the cash payment otherwise required to be made pursuant to a Performance Unit Award.

Restricted Stock and Restricted Stock Unit Awards. Restricted Stock consists of shares which are transferred to or sold by the Company to a Participant, but are subject to risk of forfeiture provisions and/or restrictions on their sale or other transfer by the Participant that will cease to apply if conditions specified by the Committee are satisfied. Restricted Stock Units are the right to receive shares of Common Stock at a future date in accordance with the terms of such grant upon the attainment of certain conditions specified by the Committee. The Committee determines the eligible Participants to whom, and the time or times at which, Awards of Restricted Stock or Restricted Stock Units will be made, the number of shares or units to be granted, the price to be paid, if any, the time or times within which the shares covered by such Awards will be subject to forfeiture, the time or times at which the restrictions will terminate, and all other terms and conditions of the Awards. Restrictions or conditions could include, but are not limited to, the attainment of performance goals, continuous service with the Company, or the passage of time.

Other Stock-Based Awards. The Committee may grant Other Stock-Based Awards, which are Awards other than Options, SARs, Restricted Stock Awards, Restricted Stock Unit Awards and Performance Share Awards based on or measured by Company Common Stock. The Committee may grant Other Stock-Based Awards to any Service Provider on such terms and conditions as the Committee deems appropriate. Other Stock-Based Awards may be granted subject to the achievement of performance goals or other conditions and may be payable in the form of money or shares of Common Stock, or a combination of the two, as determined by the Committee in the Award agreement.

Performance Goals. Restricted Stock Awards, Restricted Stock Unit Awards, Performance Share Awards, Performance Unit Awards and other Incentive Awards that are intended to qualify as Performance-Based Compensation shall be made subject to the attainment of pre-established, objective performance goals. A performance goal is considered pre-established if it is established in writing not later than 90 days after the commencement of the period of service to which the performance goal relates, provided that the outcome is substantially uncertain at the time the Committee actually established the goal. The Committee shall certify the performance results for the performance period after the performance period ends.

The performance goals applicable to any Award (other than on Options and SARs) that the Committee intends to qualify as Performance-Based Compensation shall be based on a relative comparison of entity performance to the performance of a comparator group, index or other external measure, targeted levels of, targeted levels of return on, or targeted levels of growth for, without limitation, any one or more of the following performance measures on a consolidated Company, consolidated group, subsidiary, segment, business unit or divisional level, as the Committee may specify: earnings per share; earnings before taxes; earnings before interest and taxes; earnings before interest, taxes, depreciation and amortization; net income; operating income; performance profit (operating income minus an allocated charge approximating the Company’s cost of capital, before or after tax); gross margin; operating margin and statistics; improvement in or attainment of expense levels; cost reduction; debt reduction; revenue; working capital; total assets; net assets; stockholders’ equity; debt to capital; cash flow; return on equity; return on capital; return on assets; return on invested capital; return on capital employed; ratio of operating earnings to capital spending; internal rate of return; liquidity measurements; leverage; financing and other capital raising transactions; cost of capital; customer satisfaction; employee satisfaction; customer growth; attainment of strategic or operating initiatives; operating efficiencies; comparison with various stock market indices; stock price; market share; and total stockholder return.

Clawback Policy. All grants made under the Plan are subject to any compensation, clawback or recoupment policy that may be applicable to employees of the Company, as such policy may be in effect from time to time, whether or not approved before or after the effective date of the Plan.

No Repricing. Except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding Awards may not be amended to reduce the exercise price of outstanding Options or SARs or cancel outstanding Options or SARs in exchange for cash, other awards of Options or SARs with an exercise price that is less than the exercise price of the original Options or SARs, without stockholder approval.

Amendment and Termination. The Plan shall become effective on May 9, 2014, subject to stockholder approval on such date. The Plan is effective for 10 years, but may be terminated earlier by the Board. In addition, the Board may at any time amend, suspend or reinstate the Plan, so long as any such amendment does not materially adversely affect the rights of the holder of an Award without the holder’s consent and so long as such action complies with any applicable stockholder approval requirements of Delaware or federal law, the NYSE or the Code. Any amendment that increases the aggregate number of shares issuable under the Plan or permits the exercise price of outstanding Options or SARs to be reduced (except as set forth under “Adjustments”) must receive stockholder approval.

Effect on the Prior Plan. If the Plan is approved by stockholders, then the Prior Plan will be merged with and into the Plan, no further Awards will be made under the Prior Plan, and shares with respect to all grants outstanding under the Prior Plan will be issued or transferred under the Plan.

Change In Control. In the event of a change in control, the Committee may take one or more of the following actions with respect to any or all outstanding Awards: (i) provide that all outstanding Options and SARs shall automatically accelerate and become fully exercisable, (ii) provide that the restrictions and conditions on all outstanding Incentive Awards shall immediately lapse and become fully vested and shall be paid at their target values, or in such greater amounts as the Committee may determine, (iii) require that a Service Provider surrender outstanding Options and SARs in exchange for one or more payments in cash or Common Stock as determined by the Committee, in an amount equal to the amount by which the then fair market value of the shares of Common Stock exceeds the exercise price, (iv) after giving a Service Provider an opportunity to exercise outstanding Options and SARs, terminate any or all unexercised Options and SARs at such time as the Committee deems appropriate, including cancelling out-of-the-money Options or SARs for no consideration, or (v) determine that outstanding Options and SARs that are not exercised shall be assumed by, or replaced with comparable Options or rights by,

the surviving corporation, and other outstanding Awards that remain in effect after the change in control shall be converted to similar awards of the surviving corporation.

Change in control events generally include the ownership by one person or entity of 25% or more of the Common Stock, continuing directors or their nominees cease to constitute a majority of the Board, certain mergers or consolidations involving the Company or a subsidiary as a result of which Company shares that were outstanding before the transaction cease to constitute at least 60% of the shares outstanding after the transaction, and the approval of a plan of liquidation or of a sale of all or substantially all of the Company’s assets. Notwithstanding the foregoing, for any Awards subject to the requirements of Code Section 409A that will be paid on a change in control, the transaction constituting a change in control must also constitute a “change in control event” for purposes of Code Section 409A.

Adjustments. If there is any change in the Common Stock by reason of any stock split, stock dividend, spin-off, split-up, spin-out, recapitalization, merger, consolidation, reorganization, combination or exchange of shares, the total number of shares available for Awards, the maximum numbers of shares which may be subject to an Award in any calendar year and the number of shares subject to outstanding Awards, and the price of each of the foregoing, as applicable, will be equitably adjusted. Any fractional shares resulting from such adjustment will be eliminated. In the event of any merger, consolidation or reorganization of the Company with or into another corporation which results in the Company’s outstanding Common Stock being converted into or exchanged for different securities, cash or other property, there shall be substituted on an equitable basis as determined by the Committee, for each share of Common Stock subject to an Award, the number and kind of shares of stock, other securities, cash or other property to which holders of Common Stock of the Company are entitled pursuant to the transaction. In addition, in the event of a change of control, the provisions applicable to a change in control will apply. Any adjustments to outstanding ISOs will be consistent with Sections 409A, 422, and 424 of the Code, to the extent applicable.

Plan Benefits to be Received. Awards under the Plan are discretionary, so it is currently not possible to predict the number of shares of Common Stock that will be granted or who will receive Awards under the Plan after the Annual Meeting.

Federal Income Tax Consequences

The following is a description of the U.S. federal income tax consequences as they relate to Awards:

ISOs. A Participant does not generally recognize taxable income upon the grant or upon the exercise of an ISO. If a Participant exercises an ISO during employment or within three months after his or her employment ends other than as a result of death (12 months in the case of disability), the Participant will not recognize taxable income at the time of exercise for regular U.S. federal income tax purposes (although the exercise of an ISO may in some cases trigger liability for alternative minimum tax purposes at that time as if the ISO were a NSO). Upon the sale or disposition of the acquired ISO shares, the Participant recognizes income in an amount equal to the difference, if any, between the exercise price of the ISO shares and the fair market value of those shares on the date of sale. The income is taxed at long-term capital gains rates if the Participant has not disposed of the stock within two years after the date of the grant of the ISO and has held the shares for at least one year after the date of exercise. The Company is not entitled to a federal income tax deduction. The holding period requirements are waived when a Participant dies.

If a Participant sells or disposes of ISO shares before having held them for at least one year after the date of exercise and two years after the date of grant of the ISO, the Participant recognizes ordinary income to the extent of the lesser of: (i) the gain realized upon the sale, or (ii) the difference between the exercise price and the fair market value of the shares on the date of exercise. Any additional gain is treated as long-term or short-term capital gain depending on how long the Participant held the ISO shares prior to disposition. In the year of disposition, the Company receives a federal income tax deduction in an amount equal to the ordinary income that the Participant recognizes as a result of the disposition.

NSOs. A Participant does not recognize taxable income upon the grant of an NSO. Upon the exercise of an NSO, the Participant recognizes ordinary income to the extent the fair market value of the shares received upon exercise of the NSO on the date of exercise exceeds the exercise price paid by the Participant. The Company receives an income tax deduction in an amount equal to the ordinary income that the Participant recognizes upon the exercise of the NSO.

Restricted Stock. A Participant who receives a Restricted Stock Award does not generally recognize taxable income at the time of the Award. Instead, the Participant recognizes ordinary income in the first taxable year in which his or her interest in the shares becomes either (i) freely transferable, or (ii) no longer subject to a substantial risk of forfeiture. The amount of taxable income is equal to the fair market value of the shares less the cash, if any, paid for the shares. A Participant may elect to recognize income at the time he or she receives Restricted Stock in an amount equal to the fair market value of the Restricted Stock (less any cash paid for the shares) on the date of the Award. The Company receives a compensation expense deduction in an amount equal to the ordinary income recognized by the Participant in the taxable year in which restrictions lapse (or in the taxable year of the Award if, at that time, the Participant files a timely election to accelerate recognition of income).

Other Awards. In the case of any SAR exercise, a Restricted Stock Unit Award, a Performance Share Award or a Performance Unit Award, the Participant will generally recognize ordinary income in an amount equal to any cash received and the fair market value of any shares received on the date of payment or delivery. In that taxable year, the Company will receive a federal income tax deduction in an amount equal to the ordinary income which the Participant has recognized.

Other Tax Items

Section 162(m) of the Code. Under Section 162(m) of the Code, the Company may not deduct compensation of more than $1 million that is paid to the Company’s chief executive officer and certain other employees. The 2014 Plan is designed to meet the requirements of Section 162(m) of the Code; however, Awards granted under the Plan will be treated as qualified performance-based compensation under Section 162(m) of the Code only if the Awards and the procedures associated with them comply with all other requirements of Section 162(m) of the Code. The Company cannot assure you that compensation attributable to Awards under the Plan will be treated as qualified performance-based compensation under Section 162(m) of the Code and thus be deductible to the Company.

Section 280G of the Code. Under certain circumstances, the accelerated vesting or exercise of Options or the accelerated lapse of restrictions with respect to other Awards in connection with a change in control might be deemed an “excess parachute payment” for purposes of the golden parachute tax provisions of Section 280G of the Code. To the extent it is so considered, the Participant may be subject to a 20% excise tax and we may be denied a federal income tax deduction.

Section 409A of the Code. An Award may be subject to a 20% tax, in addition to ordinary income tax, at the time the Award becomes vested, plus interest, if the grant constitutes deferred compensation under Section 409A of the Code and the requirements of Section 409A of the Code are not satisfied.

The Board Recommends a vote “FOR” this Proposal.

EXECUTIVE AND DIRECTOR COMPENSATION

Compensation Discussion and Analysis

The following is a discussion and analysis of our compensation program as they apply to each person who served as a Chief Executive Officer during a portion of 2013, our Chief Financial Officer and the three next most highly compensated executive officers who were serving as executive officers of the Company during 2013 (our NEOs). Our NEOs for 2013 were:



NEO	Title	Service Period

Gregory F. Milzcik	President and Chief Executive Officer	January 1 - February 28, 2013
Gregory F. Milzcik	Executive Vice Chairman	March 1 - May 3, 2013
Patrick J. Dempsey	Senior Vice President and Chief Operating Officer	January 1 - February 28, 2013
Patrick J. Dempsey	President and Chief Executive Officer	March 1, 2013 - Present
Christopher J. Stephens, Jr.	Senior Vice President, Finance and Chief Financial Officer	January 1, 2013 - Present
Richard R. Barnhart	President, Barnes Aerospace	January 1 - July 31, 2013
	Senior Vice President and President, Barnes Aerospace	August 1, 2013 - Present
Claudia S. Toussaint	Senior Vice President, General Counsel and Secretary	January 1, 2013 - Present
Dawn N. Edwards	Senior Vice President, Human Resources	January 1, 2013 - Present

In this Compensation Discussion and Analysis, we discuss our compensation philosophy and practices as they relate to our NEOs. We also provide details regarding the individual components of our NEO executive compensation program and explain how and why we make decisions to establish executive compensation at particular levels.

Executive Summary

During 2013, the Company focused on achieving two key strategic objectives - profitable sales growth through organic sales growth and transforming our business portfolio, and productivity improvements. We made significant investments in our worldwide application of Lean principles, the key to increasing efficiency and responding more adeptly to our customers' needs. During 2013, the Company sold its Barnes Distribution North America (BDNA) business to further focus on its two remaining segments - Aerospace and Industrial. The proceeds from this sale were used to reduce debt, repurchase outstanding shares and in October 2013 to acquire Männer, an industry innovator and leader in high precision mold-making, valve gate hot runner systems, and system solutions for the medical/pharmaceutical, packaging, and personal care/health care industries.

In addition, we had a number of executive changes during 2013, including two internal promotions. Mr. Milzcik retired and resigned from the position of President and Chief Executive Officer of the Company, effective March 1, 2013. Mr. Milzcik remained employed by the Company as Executive Vice Chairman and continued to serve as a member of the Board until the 2013 Annual Meeting. Mr. Dempsey was appointed to the position of President and Chief Executive Officer of the Company, effective March 1, 2013. The Board nominated Mr. Dempsey to become a member of the Board to fulfill the term of Mr. Milzcik's seat, effective immediately following the Company's 2013 Annual Meeting. Effective August 1, 2013, we appointed Mr. Barnhart to the position of Senior Vice President of Barnes Group and President, Barnes Aerospace to assume full responsibility and oversight of our Aerospace business segment.

The Company continued the use of an executive compensation program substantially similar to the 2012 program. For our annual incentive compensation, the Company continued to use basic earnings per share (EPS), Company-wide consolidated revenue (Revenue) and Company-wide consolidated operating margin (Operating Margin) as performance measures. For 2013, these measures applied to the NEOs other than Mr. Barnhart who was measured only on the performance of the Aerospace segment. This combination of performance measures is designed to emphasize profitability and productivity, and drive sales growth.

The Company's success in achieving these three performance measures resulted in payouts of 166% of target for NEOs paid on the results of corporate measures and 0% of target for Mr. Barnhart based on the results of Aerospace segment measures, as detailed in the below tables.

For our NEO's other than Mr. Barnhart, we calculated annual incentive compensation using the following corporate measures and weighting:



Corporate Performance Measure	Weighting (%)	As Certified 2013 Results¹	Comparison to Target

Basic EPS	70%	$2.21 ²	$0.11 above target
Revenue (in millions)	15%	$1,412 ³	$20 below target
Operating Margin	15%	12.5% ⁴	10 basis points below target

Mr. Barnhart's annual incentive was calculated using the following measures and weighting for the Aerospace segment:



Aerospace Segment Performance Measure	Weighting (%)	As Certified 2013 Results¹	Comparison to Target

Operating Profit (in millions)	70%	$30.4 ⁵	$14.4 below target
Revenue (in millions)	15%	$365 ³	$30 below target
Operating Margin	15%	8.3% ⁴	300 basis points below target

________

Results are adjusted in accordance with the Barnes Group Inc. Performance-Linked Bonus Plan for Selected Executive Officers (Performance-Linked Bonus Plan) and the Management Incentive Compensation Plan (MICP and, collectively with the Performance-Linked Bonus Plan, the Annual Incentive Plans) and certified by the Compensation Committee, as described below in the "Annual Cash Incentive Awards" section.


²	"As Certified 2013 Basic EPS" is based on reported Basic EPS, excluding the effects of discontinued operations, CEO transition costs, the U.S. Tax Court Decision cost, costs and revenues related to the effects of acquisitions and acquisition expenses, and costs related to other strategic initiatives, as directed under the Performance-Linked Bonus Plan.


³	"As Certified 2013 Revenue" for NEOs other than Mr. Barnhart is based on reported Revenue, excluding the effects of discontinued operations. "As Certified 2013 Revenue" for Mr. Barnhart is based on reported revenue for the Aerospace segment, excluding Barnes Aerospace aftermarket revenue sharing programs (RSPs).

⁴

"As Certified 2013 Operating Margin" for NEOs other than Mr. Barnhart is based on reported Operating Margin, excluding the effects of discontinued operations, CEO transition costs, costs and revenues related to the effects of acquisitions and acquisition expenses, and costs related to other strategic initiatives, as directed under the Performance-Linked Bonus Plan. "As Certified 2013 Operating Margin" for Mr. Barnhart is based on operating margin for the Aerospace segment, excluding Barnes Aerospace aftermarket RSPs.


⁵	"As Certified 2013 Operating Profit" is based on operating profit for the Aerospace segment, excluding Barnes Aerospace aftermarket RSPs.

Long-term incentive award opportunities are potentially the largest component of our NEOs' annual compensation depending upon our long-term performance. The program continues to consist of relative measure performance share awards (Relative Measure PSAs), restricted stock units (RSUs), and stock options. In 2013, we continued weighting the Relative Measure PSA portion of the program at 50%, to emphasize the program's focus on performance. Below is the weighting of the value of each type of award at the time of grant in 2013:

The relative measure program compares the Company's relative performance over a three-year period against the performance of Russell 2000 Index companies, based on three equally-weighted and independently measured performance measures: total shareholder return, basic EPS growth and operating income before depreciation and

amortization growth. The grants made in 2013 cover the 2013 to 2015 performance period. Payouts, if any, under this program will be made in 2016.

Say-on-Pay Vote

The Compensation Committee believes that our executive compensation program is consistent with our pay-for-performance philosophy. As part of our corporate governance system, we evaluate our programs in light of market conditions, stockholder views, and governance considerations, and make changes as appropriate for our business. In May 2013, we held a stockholder advisory vote on the compensation of our NEOs, commonly referred to as a "say-on-pay" vote. We had strong support from our stockholders with respect to the compensation of our NEOs, with over 95% of stockholder votes cast in favor of our say-on-pay resolution. We continue to evaluate our compensation program by taking into account the stockholder vote and other feedback from our stockholders. We hold the stockholder advisory votes on executive compensation annually. Under the Say-on-Pay Proposal (Item 3) in this proxy statement, we are recommending that stockholders cast their advisory vote in favor of approving the compensation for our NEOs as disclosed in this proxy statement.

Summary of Executive Changes for 2013

On February 22, 2013, Mr. Milzcik announced that he would retire effective at the Company's annual meeting on May 3, 2013. During the transition period, between March 1, 2013 and the 2013 annual meeting, Mr. Milzcik served as Executive Vice Chairman of the Company. His main responsibilities included enabling an orderly transition of the CEO role to Mr. Dempsey and also enabling the successful sale of the BDNA business which Mr. Milzcik carefully structured and negotiated, including a favorable cash purchase price, and which was completed timely and successfully on April 22, 2013. As compensation for the successful transition, the value creation attributable to the sale of the BDNA business, and in exchange for restrictive covenants consistent with his prior employment agreement and cooperation covenants, the Compensation Committee modified Mr. Milzcik's long-term compensation to permit all unvested equity previously granted to Mr. Milzcik to continue to vest on the previously scheduled vesting dates and to extend the post-employment exercise period for the outstanding stock options to May 3, 2018.

On March 1, 2013, Mr. Dempsey was promoted to President and Chief Executive Officer. Concurrent with his promotion, his base salary was increased from $450,000 to $750,000 and his annual incentive target was increased from 50% to 75% of base salary. Mr. Dempsey's long-term compensation target was increased from $625,000 to $1,760,000, and he was awarded long-term incentive compensation grants on February 12, 2013 and on March 1, 2013 that in combination are consistent with this target level.

On August 1, 2013, Mr. Barnhart was promoted to Senior Vice President and President, Barnes Aerospace. Concurrent with his promotion, his base salary was increased from $300,000 to $375,000 and his annual incentive target was increased from 30% of base salary to 50% of base salary. Mr. Barnhart's long-term compensation target was increased from $100,000 to $400,000. He was awarded long-term incentive compensation grants in February 2013, at the same time as other NEOs that were consistent with his prior role and an additional promotion and retention grant at the time of his promotion.

Executive Compensation Philosophy

We believe that executive compensation should support and reinforce a pay-for-performance philosophy. Consequently, our NEO compensation is closely aligned with the Company's performance on both a short-term and a long-term basis. We tie a significant portion of the compensation opportunity for our NEOs directly to the Company's stock performance and other objectives that we believe affect stockholder value. As a result, if the Company's performance meets or exceeds pre-established performance targets, including achieving performance levels at or above the 50th percentile compared to Russell 2000 Index companies, and/or our stock price increases, the NEOs have an opportunity to realize significant compensation in the form of annual cash incentive payouts and long-term equity and cash incentive payouts. If the Company's performance does not meet pre-established performance targets, including reaching performance levels below the 50th percentile compared to Russell 2000 Index companies, and/or our stock price declines, the NEOs have significant downside financial risk.

The Company aims to provide our NEOs with the opportunity to earn total direct compensation that is targeted in a range around the median compared to a defined peer group of companies. This is referred to in this proxy statement as the “Peer Group.” Individual executive compensation may be above or below the target range based

on the individual's performance, experience, skill set and range of responsibilities. We also use survey data to inform the Compensation Committee about the external market value of our executive roles. We believe that targeting the median range for total direct compensation provides an opportunity for appropriate compensation levels that will attract high quality executives, provide the proper incentives to our NEOs for achievement of our strategic objectives and retain our NEOs over the long-term.

Total Direct Compensation in 2013

Total direct compensation includes the following three elements: annual base salary; annual cash incentive awards; and long-term incentive awards. These elements allow the Compensation Committee to reinforce our pay-for-performance philosophy to address our business needs and goals with appropriate flexibility. The Compensation Committee can vary the performance measures from year to year, consistent with the applicable plans described below. In addition, our NEOs are eligible for change in control and severance benefits; pension, retirement and executive life insurance programs; and certain limited perquisites.

Performance-based compensation in the form of annual and long-term incentives constituted over 75% and over 65% of 2013 total direct compensation for our CEO and other NEOs, respectively. The actual mix of compensation for our CEO and other NEOs is shown below.

________


¹	CEO information is shown for Mr. Dempsey, who was appointed President and Chief Executive Officer on March 1, 2013. Mr. Dempsey's compensation for the time that he served as President and Chief Executive Officer was annualized for the entire year.


²	Mr. Barnhart was appointed an executive officer of the Company on August 1, 2013. Mr. Barnhart's compensation for the time that he served as an executive officer was annualized for the entire year.

The Summary Compensation Table on page 34 provides details regarding the compensation for each NEO.

Executive Compensation General Objectives and Process

Objectives

The primary objective of the Company's executive compensation philosophy is to support our long-term strategic business goals of building lasting stockholder value, achieving profitable sales growth and productivity improvements. To support these goals, our compensation program for our NEOs is designed to:


•	Provide appropriate incentives by linking and balancing significant short- and long-term compensation opportunities to Company performance and total shareholder return;


•	Reward NEOs who contribute meaningfully to achieving our strategic objectives;


•	Require NEOs to hold a significant equity investment in our Company so that they manage the business from the perspective of stockholders;


•	Align our compensation polices with stockholders' long-term interests by assigning a significant portion of potential compensation to performance-based pay elements that depend on achieving the Company's goals, but that do not encourage excessive risk-taking;


•	Attract, retain and engage highly qualified individuals by offering competitive, balanced compensation arrangements based upon clear goals that vest on continued employment; and


•	Maximize the tax effectiveness of the total compensation and benefits package, and minimize potentially adverse tax and accounting consequences, in each case to the extent practicable.

Process of Determining NEO Compensation

The Compensation Committee is responsible for determining the types and amounts of compensation paid to our NEOs. The Compensation Committee uses several tools to make these determinations, including external consultants and peer group analysis.

External Consultants

Company management generally outsources executive compensation analysis services to Frederic W. Cook & Co., Inc. (Cook). As part of these services, Cook annually compiles competitive compensation data regarding each element of compensation provided by our Company and other companies, and reviews the Company's compensation practices in terms of competitiveness, appropriateness and alignment with our performance, as well as the mix of pay.

The Compensation Committee directly retains a consulting firm, Meridian Compensation Partners, LLC (Meridian), to assist in the Compensation Committee's oversight of the executive compensation program, which includes reviewing and assessing information provided by management, including the analysis furnished by Cook. The fees for Meridian are negotiated directly by the Compensation Committee and paid by the Company at the Compensation Committee's request. Meridian did not provide any services to the Company in 2013 other than advice on executive compensation.

Meridian regularly participates in Compensation Committee meetings, both with and without Company management, and advises the Compensation Committee on compensation trends and best practices, plan design, pay and performance alignment and the process used to determine the reasonableness of individual compensation awards. The Compensation Committee believes that the use of a separate consultant reporting directly to it supports the objective that the Company's executive compensation program is reasonable and consistent with Company goals and evolving governance considerations. In addition, the Compensation Committee from time to time directly retains its own outside legal counsel. During 2013, the Compensation Committee retained the law firm Morgan, Lewis & Bockius LLP (Morgan Lewis) as its advisor in connection with the CEO transition.

The Compensation Committee has assessed the independence of both Meridian and Morgan Lewis during 2013 and believes that there is no conflict of interest. In reaching this conclusion, the Compensation Committee considered SEC Rule 10C-1(b)(4) and the corresponding NYSE independence factors regarding compensation advisor independence, and believes that its advisors are able to independently advise the Compensation Committee.

Peer Group Analysis

A primary data source used in setting the NEO compensation is the information publicly disclosed by our Peer Group. The Peer Group is reviewed periodically by Cook and updated as appropriate to take into account changes in the size, scope, financial performance, ownership structure and business focus of the Company and the peer institutions. With the assistance of Cook, management recommends to the Compensation Committee a preliminary Peer Group. At the last review, the factors considered by Cook in making its recommendations included: revenue levels within an approximate range of one-half to two times the Company's annual revenue; companies that operated in one of the same industries as the Company; and companies that used the same distribution channels as the Company. We removed from consideration all companies with a significant concentration of ownership by one party. After considering these recommendations, and receiving advice fro its independent compensation consultant, the Compensation Committee approved the Peer Group, including any changes to the Peer Group as a result of its analysis. In addition, the Compensation Committee periodically requests a separate evaluation of the Peer Group by its own consultant.

The Peer Group used for 2013 was the same as the one established in late 2009 in accordance with the above described process. For 2013, our Peer Group was comprised of the following 17 companies:



	2013 Peer Group

	Ametek Inc.	Graco Inc.
	Applied Industrial Technologies Inc.	Hexcel Corp.
	BE Aerospace Inc.	Kaman Corp.
	Carpenter Technology Corp.	Kaydon Corp.
	Circor International Inc.	Moog Inc.
	Crane Co.	Triumph Group Inc.
	Curtiss-Wright Inc.	Valmont Industries Inc.
	Enpro Industries Inc.	Watsco Inc.
	Esterline Technologies Corp.

During 2013, the Compensation Committee requested a complete review of the Peer Group given the changes to our business with the sale of BDNA in 2013 and the acquisition of Synventive Molding Solutions in 2012. Based on this review and the factors considered by Cook in the selection process discussed above, several companies were removed and a number of companies were added to the Peer Group. In addition to the factors described above, Cook utilized these additional specific criteria to review and evaluate potential peer companies:


•	Primarily focused on manufacturing


•	Multiple lines of business


•	Involved with specialty products


•	Similar customer base


•	Derives at least 25% of its revenue from outside the United States


•	Included in the Peer Group assigned to the Company by at least one of the major proxy advisory firms


•	Includes the Company in its peer group

In October 2013, the Compensation Committee approved a new Peer Group for use in evaluating NEO compensation. The 2014 Peer Group, in the aggregate, more closely aligns with the Company's annual sales revenue as well as industry composition. The median revenue of the 2013 Peer Group was $2.098 billion compared to $1.428 billion for the 2014 Peer Group. Other financial criteria used to assess the Company's position relative to the new Peer Group included: Net Income, Return on Assets, Return on Equity, Return on Invested Capital, and Market Cap. Generally, the Company ranked in the mid-range on each measure as compared to the 2014 Peer Group.

The Compensation Committee also reviewed the 1, 3, and 5 year rankings of the Company compared to the new Peer Group companies in Revenue Growth, EBITDA Growth, Net Income Growth, Cumulative Net Income, Basic EPS Growth, Return on Average Assets, Return on Average Invested Capital, and TSR. For the 1 and 3 year rankings, the Company was generally ranked in the mid-range, but below median for Revenue Growth and TSR for 1 year rankings. For the 5 year rankings, the Company ranked in the mid-range for Cumulative Net Income, Return on Average Assets, Return on Average Equity, and Return on Average Invested Capital, but below the median on the other measures. For 2014, our Peer Group will be composed of the following 24 companies:



	2014 Peer Group

	Actuant	Esterline Technologies *
	Altra Holdings	Franklin Electric
	BE Aerospace Inc. *	Graco Inc. *
	Chart Industries	Hexcel Corp. *
	Circor International Inc. *	IDEX
	CLARCOR	Kennametal
	Columbus McKinnon	Nordson
	Crane Co. *	Standex International
	Curtiss-Wright Inc. *	Trimas
	Donaldson	Valmont Industries Inc. *
	Enpro Industries Inc. *	Watts Water Technologies
	Esco Technologies	Woodward

* This company is included in both the 2013 and 2014 Peer Groups.

In addition, in connection with our annual compensation review process, in July 2013 the Compensation Committee reviewed tally sheets for each NEO.

The Role of Executive Officers

Our President and Chief Executive Officer provides the Compensation Committee with a performance assessment for each of the other NEOs. Mr. Milzcik provided commentary to the Compensation Committee with respect to NEO performance assessments and actions taken for salary changes, annual equity grants, and special BDNA transaction RSU grants. Mr. Dempsey provided commentary to the Compensation Committee with respect to Mr. Barnhart's compensation package and promotional equity grant. The Compensation Committee utilizes these assessments, along with other information, to determine NEO compensation. Mr. Dempsey and Ms. Edwards, Senior Vice President, Human Resources, regularly attend Compensation Committee meetings at the request of the Compensation Committee, but are not present for any discussion of the individual components of their own compensation. In addition, Mr. Stephens, Senior Vice President, Finance, and Chief Financial Officer, provides financial information used by the Compensation Committee to make decisions regarding incentive compensation targets and related payouts.

Components of Our Executive Compensation Program

For 2013, the compensation for our NEOs consisted of the following elements:


•	Base salary;


•	Annual cash incentive awards;


•	Long-term incentive awards;


•	Change in control and severance benefits;


•	Pension, retirement and executive life insurance programs; and


•	Limited perquisites.

Only base salary, annual cash incentive awards and long-term incentive awards are taken into account to set the target total direct compensation mix for each NEO. Based on competitive compensation data developed by Cook in December 2012, the 2013 target total direct compensation for all NEOs was within the market median range (plus or minus 10% of the median) compared to our Peer Group or available survey data. For Mr. Milzcik, our CEO at the time, the 2013 target total direct compensation was also in the market median range. In setting the target total direct compensation mix for our NEOs, the Compensation Committee may make decisions that vary from the Peer Group data based on NEO experience, retention considerations, range of responsibilities, and the nature and complexity of each NEO's role. The Compensation Committee also uses individual performance as it considers appropriate to determine whether any adjustments should be made to an NEO's total direct compensation, including the targeted long-term incentive grants.

Base Salary

Base salaries are reviewed annually, and are typically increased at periodic intervals, often at the time of a change in position or assumption of new responsibilities. Base salary increases usually take effect on or around April 1^st of each year, but may be made at interim dates within the annual cycle if the Compensation Committee deems it appropriate and necessary based on internal and external considerations. In 2013, the Compensation Committee increased Mr. Dempsey's and Mr. Barnhart's base salaries in connection with their promotions and Mr. Stephens' base salary based on the strategic contributions of his role and in order to maintain a market-competitive position. In determining whether to award merit-based salary increases to our NEOs, the Compensation Committee considered a number of factors, including the following:


•	Peer Group data and external market information;


•	Individual performance;


•	The level of responsibility assumed and the nature and complexity of each NEO's role (including the number of years in the position, any recent promotion or change in responsibility or “impact” as a member of management, and the amount, timing and percentage of the last base salary increase);


•	The leadership demonstrated to create and promote a day-to-day working environment of unwavering integrity, compliance with applicable laws and the Company's ethics policies, and global responsibility; and


•	The desire to retain NEOs capable of driving achievement of the Company's strategic objectives and the marketability and criticality of retention of NEOs.

NEO Base Salary Increases During 2013



NEO	Base Salary Effective December 31, 2012	Base Salary Effective December 31, 2013	Change in Annual Base Salary ($)	Change in Annual Base Salary (%)
P. Dempsey	$450,000	$750,000	$300,000	67%
C. Stephens, Jr.	$431,000	$461,000	$30,000	7%
R. Barnhart	$300,000	$375,000	$75,000	25%

Annual Cash Incentive Awards

We pay annual cash incentive awards to reward the performance achievements of our NEOs. Except in circumstances of retirement, death, or disability, or certain instances of involuntary termination by the Company on or after November 1^st of an award period, an NEO generally must be employed by us on the payment date to receive an annual cash incentive award. For 2013, the NEOs other than Mr. Barnhart participated in the Performance-Linked Bonus Plan (PLBP). Mr. Barnhart participated in the Management Incentive Compensation Plan (MICP) during 2013. He was not a PLBP participant in 2013 since he was promoted to an eligible position after the February 2013 Compensation Committee meeting where the Compensation Committee determined the participants in the PLBP for 2013.

We refer to the PLBP and MICP plans as our “Annual Incentive Plans.” The MICP is structured to pay annual cash incentive awards on the same terms and conditions as set forth in the PLBP. The difference between the two plans is that the PLBP is structured to pay amounts that meet the qualified performance-based compensation exception for purposes of Section 162(m) of the Internal Revenue Code. The Annual Incentive Plans generally use the same measures, target levels, threshold levels and maximum payout levels.

Under the Annual Incentive Plans, each NEO is assigned an award opportunity expressed as a percentage of his or her base salary, which varies by the NEO's role. Each NEO's annual cash incentive payout is generally determined based on our achievement of Company performance objectives.

The chart below details the cash incentive award opportunities available to each NEO for 2013 under the Annual Incentive Plans expressed as a percentage of base salary. Where performance falls between the threshold, target or maximum performance levels, the cash incentive award opportunity is calculated using straight-line interpolation.



	% of Salary
NEO	Threshold Level	Target Level	Maximum Level

G. Milzcik	18.75%	75%	225%
P. Dempsey (as CEO)	18.75%	75%	225%
P. Dempsey (as COO)	12.5%	50%	150%
C. Stephens, Jr.	12.5%	50%	150%
R. Barnhart (as SVP)	12.5%	50%	150%
R. Barnhart (as VP)	7.5%	30%	90%
C. Toussaint	11.25%	45%	135%
D. Edwards	11.25%	45%	135%

Mr. Milzcik was not eligible for a payout from the PLBP for 2013 based on the terms of his transition and resignation agreement. Payments to Mr. Dempsey and Mr. Barnhart are calculated on a prorated basis based on time served in each of their respective positions during 2013. The targets for the Annual Incentive Plans are intended to be challenging but attainable. The Compensation Committee generally establishes the target for each financial performance measure in December of each year based on review and approval of the Company's annual

business plan and budget. We use financial performance objectives as performance measures under the Annual Incentive Plans because they are consistent with our focus of driving strong business performance and increasing long-term stockholder value.

For fiscal year 2013, the performance measures for the Annual Incentive Plans were basic EPS, Revenue and Operating Margin. Basic EPS is used as a measure because we believe it is a principal driver of our stock price. Revenue is used as a measure to drive growth in the size of our business. Operating Margin is used as a measure to drive our sales to meet expected levels of profitability.

For fiscal year 2013, all NEOs except for Mr. Barnhart were evaluated on corporate measures. Mr. Barnhart was evaluated on measures tied to the performance of the Aerospace business segment that were set before his promotion on August 1, 2013 to an executive officer position. We evaluated the NEOs, other than Mr. Barnhart,100% on corporate measures in recognition of the key role that each plays in the overall management of the Company and in recognition of the impact of overall corporate strategies on segment results.

The charts below set forth the Annual Incentive Plans' performance measures and the weighting of each measure for the NEOs for 2013:

Achievement of the financial performance measures under the Annual Incentive Plans are first determined according to GAAP, but then adjusted under the terms of the PLBP and the MICP to include or exclude certain extraordinary, unusual or non-recurring items, discontinued operations and other items, all in accordance with Section 162(m) of the Internal Revenue Code. The Compensation Committee also retains negative discretion in accordance with Section 162(m) of the Internal Revenue Code to further reduce, but not increase, actual awards paid to the NEOs under the Annual Incentive Plans. The adjusted financial performance results certified by the Compensation Committee under the Annual Incentive Plans are non-GAAP financial measures.

The charts below detail results certified by the Compensation Committee compared to the goals:



Corporate Goal	Threshold		Target		Maximum		As Certified 2013 Results	Comparison to Target as a %

Basic EPS	$1.93		$2.10		$2.32		$2.21 ¹	105.2%
Revenue (in millions)	$1,332		$1,432		$1,532		$1,412 ²	98.6%
Operating Margin	12.0	%	12.6	%	13.2	%	12.5% ³	99.2%


¹	"As Certified 2013 Basic EPS" is based on reported Basic EPS, excluding the effects of discontinued operations, CEO transition costs, the U.S. Tax Court Decision costs, costs and revenues related to the effects of acquisitions and acquisition expenses, and costs related to other strategic initiatives, as directed under the Performance-Linked Bonus Plan.


²	"As Certified 2013 Revenue" is based on reported Revenue, excluding the effects of discontinued operations.


³	"As Certified 2013 Operating Margin" is based on reported Operating Margin, excluding the effects of discontinued operations, CEO transition costs, costs and revenues related to the effects of acquisitions and acquisition expenses, and costs related to other strategic initiatives, as directed under the Performance-Linked Bonus Plan.



Aerospace Segment Goal	Threshold	Target	Maximum	As Certified 2013 Results	Comparison to Target as a %

Operating Profit (in millions)	$40.3	$44.8	$51.6	$30.4 ¹	67.9%
Revenue (in millions)	$375	$395	$423	$365 ²	92.4%
Operating Margin	10.3%	11.3%	12.3%	8.3% ³	73.5%


¹	"As Certified 2013 Operating Profit" is based on operating profit for the Aerospace segment, excluding Barnes Aerospace aftermarket RSPs.


²	"As Certified 2013 Revenue" is based on reported revenue for the Aerospace segment, excluding Barnes Aerospace aftermarket RSPs.


³	"As Certified 2013 Operating Margin" is based on operating margin for the Aerospace segment, excluding Barnes Aerospace aftermarket RSPs.

The annual cash incentive awards are generally paid in February of the following calendar year, after the results are certified by the Compensation Committee. The following cash incentive awards were paid to NEOs for 2013 performance based on the performance results certified by the Compensation Committee:



NEO	Annual Incentive Earned ($)	Annual Incentive Earned as % of Base Salary

G. Milzcik¹	$0	0%
P. Dempsey²	$881,567	118%
C. Stephens, Jr.	$382,238	83%
R. Barnhart	$0	0%
C. Toussaint	$291,032	75%
D. Edwards	$220,886	75%

________


¹	Mr. Milzcik was not eligible for an Annual Incentive Award due to his retirement and resignation during 2013 based on the terms of his transition and resignation agreement with the Company.


²	Mr. Dempsey's payout is prorated for the number of days as COO and CEO, respectively, based on the different target levels for each role.

Long-Term Incentive Compensation

Long-term incentive award opportunities are potentially the largest component of our NEOs' annual compensation depending upon our long-term performance. We believe that long-term performance is enhanced through the use of awards denominated in share value. These awards reward our NEOs for maximizing stockholder value over time, aligning the interests of our employees and management with those of our stockholders. When coupled with the ownership requirements described below, our long-term incentive awards encourage our NEOs to maintain a continuing stake in our long-term success and provide an effective way to tie a substantial percentage of total direct compensation to any increase or decrease in stockholder value.

In 2013, the Company used a combination of time-based equity awards and performance-based equity awards. Particular emphasis was placed on the Relative Measure PSAs, which comprise 50% of the value of the equity awards at the time of grant. The following types of long-term incentive awards are currently used under the terms of the Barnes Group Inc. Stock and Incentive Award Plan, as amended (the Stock and Incentive Award Plan), which was approved by stockholders in 2010:



Vehicle	Target Portion of Total Long-Term Incentive Compensation		Vesting¹		Comments

Stock options	20%	•	Time-based vesting; 18, 30, and 42 months from the grant date in equal installments	•	Grants are priced at the fair market value on the grant date
RSUs	30%	•	Time-based vesting; 18, 30, and 42 months from the grant date in equal installments	•	Settled in shares of Common Stock
RSUs	30%			•	Pays out dividend equivalents in cash during vesting periods
Relative Measure PSAs	50%	•	Performance-based vesting at the end of a 3-year cycle	•	Settled in shares of Common Stock
				•	Accrued dividends are paid out in cash at the end of the 3-year cycle, adjusted for the number of shares actually earned
				•	Based on three equally weighted performance measures - total shareholder return, basic EPS growth, and operating income before depreciation and amortization growth - with each measure separately evaluated based on a comparison of the Company's performance against that of Russell 2000 Index companies

________


¹	Assumes continued employment by the NEOs.

Stock options and RSUs are subject to time-based vesting with staggered vesting dates to encourage NEO retention. In addition to the time-vesting requirements, stock options only have value if the Common Stock price at the time of exercise exceeds the fair market value on the grant date.

For 2013, the Compensation Committee continued the relative measure program established in 2011. The relative measure program is designed to increase long-term focus, but also to provide a better link to shareholder returns and reward NEOs based on performance compared to alternative investment opportunities. The program has three equally weighted and independently measured performance measures: total shareholder return, basic EPS growth, and operating income before depreciation and amortization growth. Each measure is compared separately to the Company's relative performance against that of the Russell 2000 Index over the three-year term of the program ending December 31, 2015. Based on the relative performance, following the end of the three-year cycle, a payout, if any, in the form of shares of Common Stock and accrued dividends will be made. A payout may range between zero for performance below the threshold level, to 250% of target for exceptional relative performance at the maximum level or above.

The chart below illustrates potential payouts at various levels of performance. The first payout, if any, under this program, for the 2011 grant of Relative Measure PSAs, is scheduled to occur in 2014 for the period ending December 31, 2013. We will not know the level of this payout until financial results for Russell 2000 companies are available during the second quarter of 2014.



Performance Level^1,2	2013 Relative Measure Program Payout Level	Category

Performance below 33^rd percentile	0%	Below Threshold
Performance at 33^rd percentile	33%	Threshold
Performance at 50^th percentile	100%	Target
Performance at 60^th percentile	150%	Above Target - 60^th
Performance at 75^th percentile	200%	Above Target - 75^th
Performance at or above 85^th percentile	250%	Maximum

______________


¹	Each of the three performance measures, total shareholder return, basic EPS growth, and operating income before depreciation and amortization growth, is evaluated separately as compared to performance of companies in the Russell 2000 Index.


²	Results between Performance Levels will result in interpolated payouts.

In 2012, the Company amended the form of PSA agreement for grants under the Stock and Incentive Award Plan to provide for a complete forfeiture of Relative Measure PSAs if the participant's employment is involuntarily terminated by the Company without cause before the first anniversary of the Relative Measure PSA grant date. This change applies to Relative Measure PSA grants made in 2012 and later years. Before this amendment, if a participant's employment was involuntarily terminated by the Company without cause before the first anniversary of the grant date, then a pro-rata portion of the award based on the number of days the participant was employed during the applicable performance period would have been paid based on the Company's actual performance for that performance period.

Since 2011, long-term incentive awards require a “double trigger” for accelerated vesting in the event of a change in control of the Company. In the event of a change in control as defined in the Stock and Incentive Award Plan, stock options, RSUs and Relative Measure PSAs will vest and accelerate only if an NEO's employment is terminated by the Company without cause, or if the NEO resigns for good reason (as defined in the severance agreements) on or within two years following a change in control.

Long-term incentive award opportunities are established by the Compensation Committee according to the NEO's position and responsibilities, and based on a comparison to our Peer Group and competitive compensation data. In 2013, the Compensation Committee differentiated target awards based on individual NEO performance, experience and market positioning.

Except with respect to the timeline for vesting, the Compensation Committee does not take into account existing NEO Common Stock holdings because it believes that doing so would have the effect of penalizing success (to the extent that compensation might be reduced based on the appreciation of past awards) or rewarding underperformance (to the extent that compensation might be awarded to make up for lack of appreciation in stock price).

The Company's practice is to make all equity awards at the first regularly scheduled meeting of the Compensation Committee, which is scheduled well in advance, and typically occurs early in February. The Company makes "off-cycle" equity grants to NEOs in limited circumstances, generally for newly hired executives, promotions or in recognition of special events. During 2013, "off cycle" grants were made to Mr. Dempsey at the time of his promotion to CEO. These grants in combination with the grants made during the annual February time were meant to provide total equity grants commensurate with his role as CEO. Mr. Barnhart received an equity grant at the time of his promotion, in addition to his annual February grant, primarily for the purpose of retention. Mr. Stephens, Ms. Toussaint, and Ms. Edwards received special RSU grants as a reward for their roles in the successful sale of the BDNA business in addition to their annual February grants. Details of these grants are shown in the table below.

In determining the mix of equity grants (e.g., stock options, RSUs, or Relative Measure PSAs), the Compensation Committee receives and reviews recommendations from management, based on analysis prepared by Cook. Generally, the factors considered support the pay-for-performance philosophy at the Company, aligning the interests of stockholders and NEOs, past practice, changes in business strategy, competitive practice (both generally and within the Peer Group), and the strategic impact of equity-based compensation (i.e., cost effectiveness, stockholder dilution, executive retention, a link to Company performance and total stockholder return). All of management's recommendations are reviewed by Cook and Meridian.

As reflected in the above table on page 27, in 2012 the Compensation Committee established a target mix for all NEOs that was designed to create a weighting on types of equity that were more heavily influenced by performance. The same target mix and weighting for equity was utilized in 2013 with the Relative Measure PSAs at 50%, RSUs at 30% and stock options at 20%. This target mix does not take into account potential "off-cycle" grants or supplemental awards, such as those that were made during 2013. The target mix is intended to provide our NEOs with a strong incentive to continue their successful tenures with the Company and to focus on long-term stockholder value.

Annual Long-Term Incentive Compensation¹



	Target Values	Annual Stock Option Grants	Annual RSU Grants	Relative Measure PSAs

G. Milzcik	$3,000,000	73,700	39,500	65,800
P. Dempsey	$625,000	15,400	8,200	13,700
C. Stephens, Jr.	$640,000	15,700	8,400	14,000
R. Barnhart	$100,000	0	2,195	2,195
C. Toussaint	$360,000	8,800	4,700	7,900
D. Edwards	$300,000	7,400	3,900	6,600

_____________


¹	Annual grants made during February are shown.

Promotional and Special Off-Cycle Long-Term Incentive Compensation



	Purpose of Grant	FMV at Time of Grant	Off-Cycle Stock Option Grants	Off-Cycle RSU Grants	Off-Cycle Relative Measure PSAs

P. Dempsey ¹	Promotion	$1,193,838	25,300	13,600	22,600
C. Stephens, Jr. ²	Special	$266,592		9,600
R. Barnhart ³	Promotion	$303,121		9,100
C. Toussaint ²	Special	$266,592		9,600
D. Edwards²	Special	$202,721		7,300

_____________

¹ Grants made at the time of his promotion on March 1, 2013.

² Grants made to reward performance associated with the sale of the BDNA business.

³Grants made at the time of his promotion on August 1, 2013.

NEO Stock Ownership Requirements

All of our NEOs, as well as certain other members of Company leadership, are subject to the following stock ownership requirements:



Position		Multiple of Annual Salary

President and Chief Executive Officer		5x
All Other NEOs		3x

In 2012, the Compensation Committee changed the stock ownership requirements so that 2/3 of the value of unvested RSUs count toward achieving ownership requirements. The Compensation Committee also eliminated the five and/or six year deadline to achieve ownership in favor of a requirement that all net after-tax proceeds from Company equity grants, including stock option exercises, be retained until ownership levels are met. Once ownership levels are met, the requirement is converted to a fixed number of shares. As of the end of 2013, compliance with the requirements were as follows:



NEO	Compliant with Hold Requirement	Fully Met Ownership Requirement	In Process Toward Meeting Ownership Requirement

P. Dempsey	X	X
C. Stephens, Jr.	X	X
R. Barnhart	X		X
C. Toussaint	X	X
D. Edwards	X	X

Clawback Agreements, Hedging and Pledging

•

Clawback Agreements: Beginning in late 2008, we implemented a practice whereby executives hired or promoted into corporate officer positions are required to enter into clawback agreements that permit the Company to recoup or “clawback” certain annual incentive compensation and performance based vesting equity awards paid to those officers in situations where the awards earned by these NEOs are based on the achievement of certain financial performance targets that are later restated and would therefore result in lower awards paid. The Company has entered into agreements with all NEOs, and select other key employees. In addition, all of the Company's equity award agreements provide that awards may be forfeited if an employee engages in activity that is detrimental to the Company, including performing services for a competitor, disclosing confidential information, or otherwise violating the Company's Code of Business Ethics and Conduct. With respect to the NEOs, the Compensation Committee has the discretion to make certain exceptions to the clawback requirements and ultimately determine whether any adjustment will be made.


•	Hedging: The Company prohibits hedging transactions involving the Company's securities for certain members of Company leadership, including all directors and executive officers (which includes our NEOs).

•

Pledging and Margin Accounts: In 2013, the Corporate Governance Committee adopted a new policy that prohibits certain members of Company leadership, including all directors and executive officers, from pledging or margin call arrangements involving the Company's securities that are held to meet the Company's stock ownership requirements. The new policy also places other restrictions on any other pledging or margin call arrangements involving Company securities by such individuals. In addition, the ability of these individuals to engage in such transactions requires pre-approval from the Corporate Governance Committee, and an annual certification to the Corporate Governance Committee that the individual is in compliance with the policy. None of our NEOs have pledged Company securities or have Company securities subject to a margin call arrangement.

Risk

We believe our executive compensation program is designed to motivate and reward our NEOs for their performance during the fiscal year and over the long-term and for taking appropriate business risks consistent with our strategic objectives. The following characteristics of our executive compensation program are designed to mitigate the likelihood that our NEOs would make business decisions that present undue risk:


•	The stock options and RSU components of our long-term incentive award program vest ratably over three or more years. Our Relative Measure PSAs vest based on performance at the end of the three-year performance period.


•	Performance targets are tied to several financial metrics, such as basic EPS, Revenue and Operating Margin, that are quantitative and measurable.


•	The performance periods and vesting schedules for long-term incentives overlap and, therefore, reduce the motivation to maximize performance in any one period.


•	Our stock ownership requirements require our NEOs to own equity representing a significant multiple of their base salary, and to retain this equity throughout their tenures.


•	All NEOs have entered into clawback agreements that allow us to recoup incentive compensation in situations where the awards earned by NEOs are based on the achievement of certain financial performance targets that are later restated and would therefore result in lower awards paid.

•

Payouts under our annual and long-term incentive programs are subject to a cap. Specifically, under our current practices for NEOs, our annual cash incentive award payments are capped (at not greater than 2.25 times base salary for the Chief Executive Officer and less for other NEOs). Performance based payouts under the relative measure program are capped at 2.5 times the target level Relative Measure PSA grant.

Pension and Other Retirement Programs

In addition to our 401(k) plan, our NEOs have the opportunity to participate in one or more of the following additional retirement plans:



Plan		Summary of Features

Salaried Retirement Income Plan (Qualified Plan)	•	A broad-based tax-qualified defined benefit pension plan; vesting upon attaining 5 years of service. Effective December 31, 2012, this plan was closed to employees hired on or after January 1, 2013. In lieu of this benefit, eligible new employees will receive an annual retirement contribution under the Barnes Group Inc. Retirement Savings Plan of 4% of eligible earnings. All currently employed NEOs participate in the Qualified Plan.

Retirement Benefit Equalization Plan (RBEP)	•	Provides benefits on base salary earnings in excess of Internal Revenue Service (IRS) limit on qualified plans to eligible salaried employees, officers and NEOs who do not meet MSSORP/DC Plan vesting requirements; vesting upon attaining 5 years of service.
Modified Supplemental Senior Officer Retirement Plan (MSSORP)	•	Provides a 55% average final pay benefit (base salary and annual incentive); benefit is reduced for offsets from prior employer retirement benefits and other Company retirement benefits; vesting upon attaining age 55 and 10 years of service. This program was closed to new or rehired entrants in 2008. Only Mr. Dempsey participates in the MSSORP. Mr. Milzcik was also a participant in the MSSORP, but did not meet the age and service requirements and forfeited his benefits upon his retirement and resignation.



Plan		Summary of Features

Nonqualified Deferred Compensation Plan (DC Plan)	•	Provides an annual Company contribution based on a percent of base salary and annual incentive in excess of IRS limit on qualified plans; for 2013, the contribution was based on 20% of base salary and annual incentive pay; vesting upon attaining age 55 and 10 years of service. The Company modified the DC Plan to close participation to any employee hired, rehired or promoted into an eligible position on or after April 1, 2012. Mr. Stephens and Ms. Edwards are grandfathered participants in the DC Plan.

The Qualified Plan is a broad-based tax-qualified defined benefit pension plan. The RBEP provides the same level of benefits as the Qualified Plan, but is not limited by IRS pay caps. The MSSORP and the DC Plan are non-tax-qualified supplemental executive retirement plans that provide a higher level of benefits than are available under the Qualified Plan to certain designated employees and senior level officers, including certain NEOs as reflected in the below table. We believe these more generous benefits are an important part of the overall compensation provided to our NEOs and serve as a strong retention incentive.

The chart below summarizes which NEOs participate in each of the qualified and non-qualified pension and retirement plans. A more detailed discussion of the pension benefits payable to our NEOs is described in the “Pension Benefits Table” and the narrative following the table.



NEO	Qualified Plan	RBEP	MSSORP	DC Plan

G. Milzcik¹	X	X
P. Dempsey²	X	X	X
C. Stephens, Jr.	X	X		X
R. Barnhart	X	X
C. Toussaint	X	X
D. Edwards	X	X		X

_____________

¹ At the time of his retirement, Mr. Milzcik did not fully meet the age plus service requirements for MSSORP and his interest in this program was forfeited.


²	If age and service vesting requirements are not met under the MSSORP, the RBEP benefits apply.

Change in Control and Employment Termination Benefits

The Company provides change in control benefits specifically to retain key executives, including NEOs, during a potential change in control, to provide continuity of management and to provide income continuation for NEOs who are particularly at risk of involuntary termination in the event of a restructuring in connection with a change in control. These benefits were designed to be part of a competitive compensation package and keep our executive officers focused on our business goals and objectives and we believe that these benefits are a necessary part of any total compensation package to attract and retain key executives. In some instances these agreements provide for payments and other benefits if we terminate an NEO's employment without “cause,” or if an NEO terminates employment for “good reason,” either before or after a change in control.

As discussed in more detail on page 33 below, none of the agreements for our NEOs include a gross-up for any taxes as a result of golden parachute payments under Section 280G of the Internal Revenue Code. In addition, we generally do not provide change in control cash compensation benefits in excess of severance compensation equal to two times the executive's base salary plus payments under the annual cash incentive program. Our agreements with our NEOs also provide for continuation of group health, life insurance and other benefits for twenty-four months following the executive's termination and for certain other benefits. The terms of the change in control and incremental termination benefits payable to our NEOs are described in more detail below under “Potential Payments Upon Termination or Change in Control.”

Perquisites

In 2013, the Company provided certain limited perquisites to our NEOs. The perquisites are fully described in the footnotes to the Summary Compensation Table and generally fall in the categories of financial planning and tax

preparation services and annual executive physical examination. While CEO, Mr. Milzcik was provided with personal use of the Company-leased aircraft for a value capped at $100,000. This perquisite was not continued post-employment and has not been provided to Mr. Dempsey.

In addition, in June 2013 Mr. Stephens was furnished with a one-time relocation benefit of up to $160,000 for eligible expenses incurred in connection with his relocation to the area where the Company's headquarters are located. Eligible expenses are generally those consistent with the Company's relocation policy and its practices, which includes expenses such as reimbursement for real estate sales commissions and fees and the cost to move household goods. This one-time benefit did not include any home buy-out, and was available only if the relocation was completed by December 31, 2013. All payments made by the Company as part of this benefit must be repaid by Mr. Stephens if his employment is terminated by the Company for cause or if Mr. Stephens terminates his employment voluntarily on or before July 1, 2014. The Compensation Committee determined that despite Mr. Stephens' efforts to complete his relocation by the end of 2013, the typical marketing time for a home is much longer than the period originally allowed. At its February 2014 meeting, the Compensation Committee extended eligibility for this benefit to December 31, 2014, and extended the reimbursement period to July 1, 2015.

Additional Benefits

All current NEOs other than Ms. Toussaint and Mr. Barnhart are eligible to participate in the Company's Senior Executive Enhanced Life Insurance Program (SEELIP), under which the Company pays the premiums for a life insurance policy with a benefit of four times the employee's base salary. While the policy is owned by each NEO, the Company pays the NEO's income tax liability arising from its payment of the premiums and taxes. As previously disclosed, the Company closed participation to any employee hired or promoted into an eligible position after April 1, 2011.

At the time of his promotion, Mr. Barnhart was a grandfathered participant in the Company's Enhanced Life Insurance Program (ELIP) under which the Company pays the premiums for a life insurance policy with a benefit of four times the employee's base salary. The policy is owned by the NEO, but the Company does not pay the NEO's income tax liability arising from payment of the premiums. Mr. Barnhart has continued to participate in this program.

When the SEELIP and ELIP were closed to new or rehired executives, the Company established the Executive Group Term Life Insurance Program (EGTLIP) for new NEOs and other eligible executives who were not already participants in the grandfathered ELIP. The EGTLIP provides premium payments for a term insurance policy with a benefit of four times the employee's base salary. The NEO owns the policy and is responsible for any tax liability (no tax gross-up) resulting from this program. Ms. Toussaint is a participant in the EGTLIP.

Each of our NEOs participates in other employee benefit plans generally available to all U.S. based employees (e.g., health insurance, 401(k) Plan) on the same terms as all other employees.

Tax and Accounting Considerations

Internal Revenue Code Section 162(m)

As discussed above, our Compensation Committee considers the tax and accounting treatment associated with cash and equity awards it makes, although these considerations are not the overriding factor that the Compensation Committee uses in making its decisions. Section 162(m) of the Internal Revenue Code places a limit of $1 million on the compensation that the Company may deduct in any one year with respect to each of its most highly compensated executive officers, unless certain conditions are met. There is an exception to the $1 million limitation for performance-based compensation meeting certain requirements. The Company currently grants awards intended to meet this exception including annual cash incentive awards, stock option awards, and PSAs. Grants of restricted stock or stock units that vest solely on the basis of service do not qualify for the exception. To maintain flexibility in compensating NEOs in a manner designed to promote varying Company goals, our Compensation Committee has not adopted a policy requiring all compensation to be deductible. Our Compensation Committee may approve compensation or changes to plans, programs or awards that may cause the compensation or awards to exceed the limitation under Section 162(m) if it determines that action is appropriate and in our best interests.

Internal Revenue Code Section 280G

The Company also periodically reviews the severance agreements entered into between the Company and the NEOs to assess the impact of Section 280G of the Internal Revenue Code. Currently, the severance agreements do not provide for any gross-up to compensate our NEOs for taxes incurred under Section 4999 of the Internal Revenue Code as a consequence of “golden parachute” payments upon a change-in-control. Nor do they preclude the possibility that, in certain circumstances, the compensation payable in the event of a change in control under the agreements or other plans and arrangements may be non-deductible by the Company under Section 280G of the Internal Revenue Code.

Accounting for Equity Compensation

The Company accounts for its stock-based employee compensation plans at fair value on the grant date and recognizes the related cost in its consolidated statement of income in accordance with accounting standards related to share-based payments. The fair values of stock options are estimated using the Black-Scholes option-pricing model based on certain assumptions. The fair values of RSU awards and Relative Measure PSA awards with a performance condition are estimated based on the fair market value of the Company's stock price on the grant date. The fair values of Relative Measure PSA awards with a market condition are estimated using a Monte Carlo valuation model based on certain assumptions.

Compensation Committee Report

To Our Fellow Stockholders at Barnes Group Inc.

We, the Compensation and Management Development Committee of the Board of Directors of Barnes Group Inc., have reviewed and discussed with management the Compensation Discussion and Analysis contained in this proxy statement and, based on such review and discussion, have recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement.

The Compensation Committee

Mylle H. Mangum, Chair

Thomas J. Albani

John W. Alden

Gary G. Benanav

Francis J. Kramer

Risk Oversight and Assessment Policies and Practices

Our Audit Committee is ultimately responsible for overall risk oversight for the Company generally. See “Board Role in Risk Oversight” on page 63. The Compensation Committee evaluates and reviews our incentive compensation arrangements annually based on an inventory of all relevant compensation programs prepared by the Human Resources department which includes details of the principal features of the programs, including any key risk mitigation factors such as (i) the mix of equity award instruments used under our long-term incentive program; (ii) the multi-year vesting of our equity awards; (iii) our stock ownership requirements; and (iv) the clawback agreements in place for certain executives. The Compensation Committee also consults with, and makes certain recommendations to, the Board regarding the Company's compensation programs as necessary. Based on its evaluation, the Compensation Committee has concluded that the overall structure of the compensation programs for NEOs and company-wide employees are designed with the appropriate balance of risk and reward in relation to the Company's overall business strategy and are not reasonably likely to have a material adverse effect on the Company.

Summary Compensation Table for 2013, 2012 and 2011

The following table sets forth the compensation earned by our NEOs for the fiscal years ended December 31, 2013, 2012 and 2011:



Name and Principal Position	Year	Salary		Bonus¹	Stock Awards²		Option Awards³		Non-Equity Incentive Plan Compensation⁴		Change in Pension Value and Nonqualified Deferred Compensation Earnings^5,6		All Other Compensation⁷		Total
Patrick J. Dempsey President and Chief Executive Officer	2013	$	700,000	—	$	1,588,668	$	371,030	$	881,567	$	253,304	$	123,261	$	3,917,830
	2012	447,783		—	565,484		124,787		250,988		364,266		104,764		1,858,072
	2011	427,250		—	274,901		122,836		646,500		378,554		74,451		1,924,492
Christopher J. Stephens, Jr. Senior Vice President, Finance and Chief Financial Officer	2013	453,585		—	875,508		135,805		382,238		10,912		165,604		2,023,652
	2012	431,000		—	1,339,261		130,546		240,390		49,038		234,870		2,425,105
	2011	427,250		—	340,131		150,549		646,500		36,337		218,575		1,819,342

Claudia S. Toussaint Senior Vice President, General Counsel and Secretary	2013	390,000		100,000	609,225		76,120		291,032		34,224		13,778		1,514,379
	2012	289,270		—	830,098		72,734		146,265		81,302		88,214		1,507,883
	2011	356,250		—	270,241		119,840		486,000		33,721		158,106		1,424,158

Dawn N. Edwards Senior Vice President, Human Resources	2013	296,000		—	488,327		64,010		220,886		—		80,568		1,149,791
	2012	296,000		—	269,177		60,474		148,585		102,683		133,699		1,010,618
	2011	292,250		—	223,648		101,115		399,600		73,928		117,334		1,207,875

Richard R. Barnhart Senior Vice President and President, Barnes Aerospace	2013	334,750		—	419,873		—		—		32,401		30,102		817,126



Gregory F. Milzcik Former President and Chief Executive Officer	2013	306,936		—	10,691,189		5,526,601		—		—		153,891		16,678,617
	2012	890,000		—	2,699,218		599,937		744,596		1,729,195		260,844		6,923,790
	2011	886,250		—	2,040,788		904,792		2,002,500		1,802,030		204,408		7,840,768

_______


¹	In connection with her rehire on June 19, 2012, Ms. Toussaint received a cash signing bonus in the amount of $100,000. Because this amount was fully reimbursable if Ms. Toussaint voluntarily terminated employment with the Company within twelve months of the signing bonus payment date, it is considered earned in 2013.

Stock Awards represent the aggregate grant date fair value of RSUs and Relative Measure PSAs granted to NEOs under the Stock and Incentive Award Plan. Relative Measure PSA awards vest upon satisfying established performance and market goals. In addition to the RSU value, the value disclosed in this column for the Relative Measure PSA awards for Messrs. Dempsey, Stephens, Barnhart and Milzcik and Mses. Toussaint and Edwards represents the amount of compensation if target goals are met. The maximum grant date fair value of the Relative Measure PSA awards granted in 2013 was $1,942,218 for Mr. Dempsey, $744,660 for Mr. Stephens, $420,201 for Ms. Toussaint and $351,054 for Ms. Edwards, $116,752 for Mr. Barnhart and $12,060,819 for Mr. Milzcik. All three measures of the Relative Measure PSA awards allow an NEO to receive up to 250% of the target amount, however, only the basic EPS growth and operating income before depreciation and amortization growth measures would increase the compensation awarded under ASC 718 if the award paid out at maximum. The fair value of the performance based portion of the awards was determined based on the market value of Common Stock on the date of grant and the fair value of the market based portion of awards was determined based on a Monte Carlo valuation method; as described in the note on Stock-Based Compensation in the notes to the Company's consolidated financial statements filed with the Annual Report on Form 10-K for the respective year-end. Also included in this column for Mr. Milzcik is the incremental increase of $7,828,799 in fair value of current and prior year grants resulting from a change in service condition that was treated as a modification under ASC 718.

Option Awards represent the aggregate grant date fair value of stock options granted to NEOs under the Stock and Incentive Award Plan. The fair value was determined by using the Black-Scholes option pricing model applied consistently with the Company's practice, as described in the note on Stock-Based Compensation in the notes to the Company's consolidated financial statements filed with the Annual Report on Form 10-K for the respective year-end. Also included in this column for Mr. Milzcik is the incremental increase of $4,889,096 in fair value of current and prior year grants resulting from a change in service condition that was treated as a modification under ASC 718.


⁴	Non-Equity Incentive Plan Compensation includes amounts earned under the PLBP for Messrs. Dempsey, Stephens, Milzcik and Mses. Toussaint (in 2011 and 2013) and Edwards, and the amount earned under the MICP for Ms. Toussaint in 2012. Mr. Barnhart was a participant in the MICP in 2013 and did not receive non-equity incentive plan compensation.

⁵

The amount listed in Change in Pension Value and Nonqualified Deferred Compensation Earnings represents the annual increase in pension value for all of the Company's defined benefit retirement programs. All assumptions are as detailed in the notes to the Company's consolidated financial statements filed with the Annual Report on Form 10-K for the respective year-end, with the exception of the following: retirement age for all plans is assumed to be the older of the unreduced retirement age, as defined by each plan, or age as of December 31, 2013, December 31, 2012 or December 31, 2011, as applicable, and no pre-retirement mortality, disability, or termination is assumed. The U.S. discount rates of 5.20%, 4.25% and 5.05%, respectively, are detailed in the Management's Discussion & Analysis filed with the Annual Report on Form 10-K for the respective year-end. Since the net change in Pension Value and Nonqualified Deferred

Compensation Earnings for all of the plans nets to a negative amount for Mr. Milzcik and Ms. Edwards in 2013, the net amount is excluded from the table.


⁶	The Change in Pension Value and Nonqualified Deferred Compensation Earnings is segregated by plan in the following table:



Name and Principal Position	Plan Name	Year	Amounts

Patrick J. Dempsey President and Chief Executive Officer	Qualified	2013	$	(22,962	)
	RBEP	2013	N/A ^a
	MSSORP	2013	276,266
	SERP	2013	N/A
	TOTAL	2013	253,304
	Qualified	2012	$	113,309
	RBEP	2012	N/A ^a
	MSSORP	2012	314,096
	SERP	2012	(63,139		)
	TOTAL	2012	364,266
	Qualified	2011	$	79,898
	RBEP	2011