diff --git a/CHANGELOG.md b/CHANGELOG.md
index 6dc8e0ede..e56002baf 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,6 +1,18 @@
+## Diamond Node Software 4.0.2
+
+OPTIONAL Update
+
+New behavior for validator nodes as main feature
+- [Autoshutdown if a Node becomes a regular Node](https://github.com/DMDcoin/diamond-node/issues/322)
+
+Further stability improvements
+- [FIXED: received transactions are getting pooled, if announced by another peer](https://github.com/DMDcoin/diamond-node/issues/304)
+- [FIXED: dropped transactions are getting pooled](https://github.com/DMDcoin/diamond-node/issues/303)
+- [FIXED: key generation can panic if faulty validators write malicious parts](https://github.com/DMDcoin/diamond-node/issues/100)
+
 ## Diamond Node Software 4.0.1
 
-First hotfix
+OPTIONAL: First hotfix
 Mitigates the transaction spam caused by flaws in the transaction management of report disconnectivity transactions.
 
 - [Reduce Intervals for connectivity checks](https://github.com/DMDcoin/diamond-node/issues/313)
diff --git a/Cargo.lock b/Cargo.lock
index f41aa956e..d6d86f352 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -850,7 +850,7 @@ dependencies = [
 
 [[package]]
 name = "diamond-node"
-version = "4.0.1"
+version = "4.0.2-rc1"
 dependencies = [
  "ansi_term 0.10.2",
  "atty",
@@ -3579,7 +3579,7 @@ dependencies = [
 
 [[package]]
 name = "parity-version"
-version = "4.0.1"
+version = "4.0.2-rc1"
 dependencies = [
  "parity-bytes",
  "rlp",
diff --git a/Cargo.toml b/Cargo.toml
index edeb127ca..963b350a2 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -2,7 +2,7 @@
 description = "Diamond Node"
 name = "diamond-node"
 # NOTE Make sure to update util/version/Cargo.toml as well
-version = "4.0.1"
+version = "4.0.2-rc1"
 license = "GPL-3.0"
 authors = [
 	"bit.diamonds developers",
diff --git a/bin/oe/run.rs b/bin/oe/run.rs
index 92dc4feb5..c58504c86 100644
--- a/bin/oe/run.rs
+++ b/bin/oe/run.rs
@@ -723,7 +723,7 @@ impl RunningClient {
                     .name("diamond-node-force-quit".to_string())
                     .spawn(move || {
 
-                        let duration_soft = 5;
+                        let duration_soft = 15;
                         // we make a force quit if after 90 seconds, if this shutdown routine 
                         std::thread::sleep(Duration::from_secs(duration_soft));
                         warn!(target: "shutdown", "shutdown not happened within {duration_soft} seconds, starting force exiting the process.");
diff --git a/crates/ethcore/src/engines/hbbft/contracts/keygen_history.rs b/crates/ethcore/src/engines/hbbft/contracts/keygen_history.rs
index ee41a17ef..a4d5abd73 100644
--- a/crates/ethcore/src/engines/hbbft/contracts/keygen_history.rs
+++ b/crates/ethcore/src/engines/hbbft/contracts/keygen_history.rs
@@ -156,12 +156,25 @@ pub fn acks_of_address(
         if serialized_ack.is_empty() {
             return Err(CallError::ReturnValueInvalid);
         }
-        let deserialized_ack: Ack = bincode::deserialize(&serialized_ack).unwrap();
-        let outcome = skg
-            .handle_ack(vmap.get(&address).unwrap(), deserialized_ack)
-            .unwrap();
+        let deserialized_ack: Ack = match bincode::deserialize(&serialized_ack) {
+            Ok(ack) => ack,
+            Err(e) => {
+                error!(target: "engine", "Failed to deserialize Ack #{} for address {}: {:?}", n, address, e);
+                return Err(CallError::ReturnValueInvalid);
+            }
+        };
+
+        let outcome = match skg.handle_ack(vmap.get(&address).unwrap(), deserialized_ack) {
+            Ok(s) => s,
+            Err(e) => {
+                error!(target: "engine", "Failed to handle Ack #{} for address {}: {:?}", n, address, e);
+                return Err(CallError::ReturnValueInvalid);
+            }
+        };
+
         if let AckOutcome::Invalid(fault) = outcome {
-            panic!("Expected Ack Outcome to be valid. {:?}", fault);
+            error!(target: "engine", "Invalid Ack Outcome for #{} for address {}: {:?}", n, address, fault);
+            return Err(CallError::ReturnValueInvalid);
         }
     }
 
diff --git a/crates/ethcore/src/engines/hbbft/hbbft_state.rs b/crates/ethcore/src/engines/hbbft/hbbft_state.rs
index 725e5b75f..fe94ec2bd 100644
--- a/crates/ethcore/src/engines/hbbft/hbbft_state.rs
+++ b/crates/ethcore/src/engines/hbbft/hbbft_state.rs
@@ -222,10 +222,29 @@ impl HbbftState {
         }
 
         if sks.is_none() {
-            info!(target: "engine", "We are not part of the HoneyBadger validator set - running as regular node.");
+            info!(target: "engine", "We are not part of the HoneyBadger validator set - Running as regular node.");
             peers_service
                 .send_message(HbbftConnectToPeersMessage::DisconnectAllValidators)
                 .ok()?;
+
+            if self.is_validator() {
+                let is_syncing = if let Some(full) = client.as_full_client() {
+                    full.is_major_syncing()
+                } else {
+                    info!(target: "engine", "Node was a validator: cannot be determinated, because client is not a full client. (https://github.com/DMDcoin/diamond-node/issues/322.)");
+                    return Some(());
+                };
+
+                if is_syncing {
+                    debug!(target: "engine", "Node was a validator, and became regular node, but we are syncing, not shutting down Node as defined in https://github.com/DMDcoin/diamond-node/issues/322.");
+                } else {
+                    info!(target: "engine", "Node was a validator, and became regular node. shutting down Node as defined in https://github.com/DMDcoin/diamond-node/issues/322.");
+                    // for unit tests no problem, demand shutddown won't to anything if its a unit test.
+                    // e2e tests needs adaptation.
+                    // this gracefully shuts down a node, if it was a validator before, but now it is not anymore.
+                    client.demand_shutdown();
+                }
+            }
             return Some(());
         }
 
diff --git a/crates/ethcore/sync/src/chain/handler.rs b/crates/ethcore/sync/src/chain/handler.rs
index a4a74f0ba..0c4e92ea5 100644
--- a/crates/ethcore/sync/src/chain/handler.rs
+++ b/crates/ethcore/sync/src/chain/handler.rs
@@ -884,10 +884,11 @@ impl SyncHandler {
                 return Ok(());
             }
 
-            if io
-                .chain()
-                .transaction_if_readable(&hash, &deadline.time_left())
-                .is_none()
+            if !sync.lately_received_transactions.contains(&hash)
+                && io
+                    .chain()
+                    .transaction_if_readable(&hash, &deadline.time_left())
+                    .is_none()
             {
                 sync.peers
                     .get_mut(&peer_id)
diff --git a/crates/ethcore/sync/src/chain/mod.rs b/crates/ethcore/sync/src/chain/mod.rs
index 3a204b3c1..2053653fe 100644
--- a/crates/ethcore/sync/src/chain/mod.rs
+++ b/crates/ethcore/sync/src/chain/mod.rs
@@ -758,6 +758,8 @@ pub struct ChainSync {
     statistics: SyncPropagatorStatistics,
     /// memorizing currently pooled transaction to reduce the number of pooled transaction requests.
     asking_pooled_transaction_overview: PooledTransactionOverview,
+    /// memorized lately received transactions to avoid requesting them again.
+    lately_received_transactions: H256FastSet,
 }
 
 #[derive(Debug, Default)]
@@ -849,6 +851,7 @@ impl ChainSync {
             new_transactions_stats_period: config.new_transactions_stats_period,
             statistics: SyncPropagatorStatistics::new(),
             asking_pooled_transaction_overview: PooledTransactionOverview::new(),
+            lately_received_transactions: H256FastSet::default(),
         };
         sync.update_targets(chain);
         sync
@@ -952,6 +955,9 @@ impl ChainSync {
             trace!(target: "sync", "Received {:?}", txs.iter().map(|t| t.hash).map(|t| t.0).collect::<Vec<_>>());
         }
 
+        self.lately_received_transactions
+            .extend(txs.iter().map(|tx| tx.hash()));
+
         // Remove imported txs from all request queues
         let imported = txs.iter().map(|tx| tx.hash()).collect::<H256FastSet>();
         for (pid, peer_info) in &mut self.peers {
@@ -1024,6 +1030,7 @@ impl ChainSync {
         // Reactivate peers only if some progress has been made
         // since the last sync round of if starting fresh.
         self.active_peers = self.peers.keys().cloned().collect();
+        self.lately_received_transactions.clear();
         debug!(target: "sync", "resetting sync state to {:?}", self.state);
     }
 
@@ -1267,6 +1274,7 @@ impl ChainSync {
         debug!(target: "sync", "sync_peer: {} force {} state: {:?}",
             peer_id, force, self.state
         );
+
         if !self.active_peers.contains(&peer_id) {
             trace!(target: "sync", "Skipping deactivated peer {}", peer_id);
             return;
@@ -1439,7 +1447,20 @@ impl ChainSync {
                 // and if we have nothing else to do, get the peer to give us at least some of announced but unfetched transactions
                 let mut to_send = H256FastSet::default();
                 if let Some(peer) = self.peers.get_mut(&peer_id) {
-                    // info: this check should do nothing, if everything is tracked correctly,
+                    // remove lately received transactions from unfetched list
+                    // depending witch collection is larger, we choose the appropriate method.
+                    if self.lately_received_transactions.len() > 0 {
+                        if peer.unfetched_pooled_transactions.len()
+                            > self.lately_received_transactions.len()
+                        {
+                            self.lately_received_transactions.iter().for_each(|h| {
+                                peer.unfetched_pooled_transactions.remove(h);
+                            });
+                        } else {
+                            peer.unfetched_pooled_transactions
+                                .retain(|h| !self.lately_received_transactions.contains(h));
+                        }
+                    }
 
                     if peer.asking_pooled_transactions.is_empty() {
                         // todo: we might just request the same transactions from  multiple peers here, at the same time.
diff --git a/crates/util/version/Cargo.toml b/crates/util/version/Cargo.toml
index be1b4000e..45eee360f 100644
--- a/crates/util/version/Cargo.toml
+++ b/crates/util/version/Cargo.toml
@@ -1,7 +1,7 @@
 [package]
 name = "parity-version"
 # NOTE: this value is used for OpenEthereum version string (via env CARGO_PKG_VERSION)
-version = "4.0.1"
+version = "4.0.2-rc1"
 authors = [
 	"bit.diamonds developers",
 	"OpenEthereum developers",