EXHIBIT 10.4

 

Tyco Electronics Ltd.

2007 Stock and Incentive Plan

 

TERMS AND CONDITIONS

OF

RESTRICTED UNIT AWARD

 

RESTRICTED UNIT AWARD made as of                                         ,
          .

 

1.                                       Grant of Award.  Tyco Electronics Ltd.
(the “Company”) has granted you                Tyco Electronics Restricted
Units, subject to the provisions of this Award Agreement.  The Company will hold
the Restricted Units in a bookkeeping account on your behalf until they become
payable or are forfeited or cancelled.

 

2.                                       Payment Amount.  Each Restricted Unit
represents one (1) Share of Common Stock.

 

3.                                       Form of Payment.  Vested Restricted
Units will be redeemed solely for Shares, subject to Section 15.

 

4.                                       Dividends.  Restricted Units are a
promise to deliver Common Stock upon vesting.  For each Restricted Unit that is
unvested, you will be credited with a Dividend Equivalent Unit (DEU) for any
cash or stock dividends distributed by the Company on Company Common Stock. 
DEUs will be calculated at the same dividend rate paid to other holders of
Common Stock.  DEUs will vest and be delivered in the form of Shares in
accordance with the vesting and payment schedules applicable to the underlying
Units.

 

5.                                       Time of Delivery.  Except as otherwise
provided for in this Award Agreement, vested Restricted Units and Dividend
Equivalent Units shall be delivered to participants in the form of Shares as
soon as is administratively feasible following the date of vesting.

 

6.                                       Normal Vesting.  Your Restricted Unit
Award will vest in equal installments over four years beginning on the first
anniversary of the Grant Date. Your vested right will be calculated on each
anniversary of the Grant Date.  No credit will be given for periods following
Termination of Employment.

 

7.                                       Termination of Employment.  Any
Restricted Units and DEUs that have not vested as of your Termination of
Employment, other than as set forth in paragraphs 8, 9, 10 and 11, will
immediately be forfeited, and your rights with respect to those Restricted Units
and DEUs will end.

 

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8.                                       Death or Disability.  If your
Termination of Employment is as a result of your Death or Disability, your
Restricted Unit Award will immediately become fully vested.  Such vested
Restricted Units will be delivered as soon as is administratively possible upon
your Termination of Employment.  If you are deceased, the Company will make a
payment to your estate immediately after the Committee or its designee has
determined that the payee is the duly appointed executor or administrator of
your estate.

 

9.                                       Retirement.  If you have attained age
55 and have completed at least five years of service, your Restricted Unit Award
will vest pro rata (rounded down to the nearest Unit, in full-month increments)
based on (i) the number of whole months that you have completed from Date of
Grant through the end of the month in which your Termination of Employment
occurs, over the original number of months of the vesting period, times (ii) the
total number of Units awarded under the Grant minus (iii) the number of Units
previously vested under the Normal Vesting terms; provided, however, that you
will not be entitled to the accelerated vesting under this Section 9 until you
have completed at least one year of service following the Date of Grant. 
Termination of Employment within 12 months of the Grant Date will result in the
forfeiture of your Restricted Unit Award, except as otherwise provided for in
paragraphs 8, 10, and 11

 

10.                                 Change in Control.  If your employment is
terminated following a Change in Control, as defined in the Plan, your
Restricted Unit Award will immediately become fully vested and delivered,
provided that:

 

(a) your employment is terminated by the Company or a Subsidiary for any reason
other than Cause, Disability or Death in the twelve-month period following the
Change in Control; or

 

(b) you terminate your employment with the Company or your employing Subsidiary
within the twelve-month period following the Change in Control as a result of,
and within 180 days following, the occurrence of one of the following events:

 

i.      the Company or your employing Subsidiary (1) assigns or causes to be
assigned to you duties inconsistent in any material respect with your position
as in effect immediately prior to the Change in Control; (2) makes or causes to
be made any material adverse change in your position, authority, duties or
responsibilities; or (3) takes or causes to be taken any other action which, in
your reasonable judgment, would cause you to violate your ethical or
professional obligations (after written notice of such judgment has been
provided by you to the Company and the Company has been given a 15-day period
within which to cure such action), or which results in a significant diminution
in such position, authority, duties or responsibilities; or

 

ii.   the Company or your employing subsidiary, without your consent,
(1) requires you to relocate to a principal place of employment more than fifty
(50) miles from your existing place of employment; or (2) reduces your base
salary, annual bonus, or retirement, welfare, stock incentive, perquisite (if
any) and other benefits taken as a whole.

 

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11.                                 Termination of Employment as a Result of
Divestiture or Outsourcing. If your Termination of Employment is as a result of
a Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement,
your Restricted Unit Award will vest pro rata (rounded down to the nearest Unit
in full-month increments) and will be delivered immediately.  The pro rated
vesting will be based on (i) the number of whole months that you have completed
from Grant Date through the closing date of the applicable transaction over the
original number of months of the vesting period, times (ii) the total number of
Units awarded under the Grant minus (iii) the number of Units previously vested
under the Normal Vesting terms.

 

Notwithstanding the foregoing, you shall not be eligible for such pro-rata
vesting if, (i) your Termination of Employment occurs on or prior to the closing
date of such Disposition of Assets or Disposition of a Subsidiary, as
applicable, or on such later date as is specifically provided in the applicable
transaction agreement or related agreements, or on the effective date of such
Outsourcing Agreement applicable to you (the “Applicable Employment Date”), and
(ii) you are offered Comparable Employment with the buyer, successor company or
outsourcing agent, as applicable, but do not commence such employment on the
Applicable Employment Date.

 

For the purposes of this Section 11, (a) “Comparable Employment” shall mean
employment at a base salary rate and bonus target that is at least equal to the
base salary rate and bonus target in effect immediately prior to your
termination of employment and at a location that is no more than 50 miles from
your job location in effect immediately prior to your termination of employment;
(b) “Disposition of Assets” shall mean the disposition by the Company or a
Subsidiary of all or a portion of the assets used by the Company or Subsidiary
in a trade or business to an unrelated corporation or entity;  (c) “Disposition
of a Subsidiary” shall mean the disposition by the Company or a Subsidiary of
its interest in a subsidiary or controlled entity to an unrelated individual or
entity, provided that such subsidiary or entity ceases to be an affiliated
company as a result of such disposition; and (d) “Outsourcing Agreement” shall
mean a written agreement between the Company or a Subsidiary and an unrelated
third party (“Outsourcing Agent”) pursuant to which the Company transfers the
performance of services previously performed by employees of the Company or
Subsidiary to the Outsourcing Agent, and the Outsourcing Agreement includes an
obligation of the Outsourcing Agent to offer employment to any employee whose
employment is being terminated as a result of or in connection with said
Outsourcing Agreement.

 

12.                                 Responsibility for Taxes.  Regardless of any
action the Company or your employer (the “Employer”) takes with respect to any
or all income tax, social insurance, payroll tax, payment on account or other
tax-related items related to your participation in the Plan and legally
applicable to you (“Tax-Related Items”), by accepting the Award, you acknowledge
that the ultimate liability for all Tax-Related Items is and remains your
responsibility and may exceed the amount actually withheld by the Company or the
Employer.  You further acknowledge that the Company and/or the Employer do not
commit to and are under no obligation to structure the terms of the grant or any
aspect of the Restricted Units to reduce or eliminate your liability for
Tax-Related Items or achieve any particular tax result.  Further, if you have
become subject to tax in more than one jurisdiction between the date of grant
and the date of any relevant taxable event, you acknowledge that the Company
and/or the Employer (or former employer, as

 

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applicable) may be required to withhold or account for Tax-Related Items in more
than one jurisdiction.

 

Prior to any relevant taxable or tax withholding event, as applicable, you will
pay or make adequate arrangements satisfactory to the Company and/or the
Employer to satisfy all Tax-Related Items.  In this regard, you authorize the
Company and/or the Employer, or their respective agents, at their discretion, to
satisfy the obligations with regard to all Tax-Related Items by one or a
combination of the following:

 

(1)                                  withholding from your wages or other cash
compensation paid to you by the Company and/or the Employer; or

 

(2)                                  withholding from proceeds of the sale of
Shares acquired upon vesting of the Restricted Units either through a voluntary
sale or through a mandatory sale arranged by the Company (on your behalf
pursuant to this authorization); or

 

(3)                                  withholding in Shares to be issued upon
vesting of the Restricted Units.

 

To avoid negative accounting treatment, the Company may withhold or account for
Tax-Related Items by considering applicable minimum statutory withholding
amounts or other applicable withholding rates.  If the obligation for
Tax-Related Items is satisfied by withholding in Shares, for tax purposes, you
are deemed to have been issued the full number of Shares subject to the vested
Restricted Units, notwithstanding that a number of the Shares are held back
solely for the purpose of paying the Tax-Related Items due as a result of any
aspect of your participation in the Plan.

 

Finally, you shall pay to the Company or the Employer any amount of Tax-Related
Items that the Company or the Employer may be required to withhold or account
for as a result of your participation in the Plan that cannot be satisfied by
the means previously described.  The Company may refuse to issue or deliver the
Shares or the proceeds of the sale of Shares if you fail to comply with your
obligations in connection with the Tax-Related Items.

 

13.                                 Transfer of Award.  You may not transfer any
interest in Restricted Units except by will or the laws of descent and
distribution.  Any other attempt to dispose of your interest in Restricted Units
will be null and void.

 

14.                                 Covenant; Forfeiture of Award; Agreement to
Reimburse Company.

 

(a)                                  If you have been terminated for Cause, any
unvested restricted units shall be immediately rescinded and, in addition, you
hereby agree and promise immediately to deliver to the Company the number of
Shares (or, in the discretion of the Committee, the cash value of said shares)
you received for Restricted Units that vested during the period six (6) months
prior to your Termination of Employment through the date of Termination of
Employment.

 

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(b)                                 If, after your Termination of Employment,
the Committee determines in its sole discretion that while you were a Company or
Subsidiary employee you engaged in activity that would have constituted grounds
for the Company or Subsidiary to terminate your employment for Cause, then you
hereby agree and promise immediately to deliver to the Company the number of
Shares (or, in the discretion of the Committee, the cash value of said shares)
you received for Restricted Units that vested during the period six (6) months
prior to your Termination of Employment through the date of Termination of
Employment.

 

(c)                                  If the Committee determines, in its sole
discretion, that at any time after your Termination of Employment and prior to
the second anniversary of your Termination of Employment you (i) disclosed
business confidential or proprietary information related to any business of the
Company or Subsidiary or (ii) have entered into an employment or consultation
arrangement (including any arrangement for employment or service as an agent,
partner, stockholder, consultant, officer or director) with any entity or person
engaged in a business and (A) such employment or consultation arrangement would
likely (in the Committee’s sole discretion) result in the disclosure of business
confidential or proprietary information related to any business of the Company
or a Subsidiary to a business that is competitive with any Company or Subsidiary
business as to which you have had access to business strategic or confidential
information, and (B) the Committee has not approved the arrangement in writing,
then you hereby agree and promise immediately to deliver to the Company the
number of Shares (or, in the discretion of the Committee, the cash value of said
shares) you received for Restricted Units that vested during the period six
(6) months prior to your Termination of Employment through the date of
Termination of Employment.

 

(d)                                 The Committee shall be entitled to require
that you repay all or part of any amount received (whether in cash or stock)
pursuant to the terms of this Award (i) to the extent it deems it necessary or
appropriate to comply with any future rules of the Securities and Exchange
Commission, New York Stock Exchange or any other governmental agency, as they
may be amended from time to time, or (ii) to the extent otherwise deemed
appropriate by the Committee to recover any overpayment or mistaken payment that
was based on deficient financial information, and you hereby agree and promise
to promptly remit to the Company any such amount.

 

15.                                 Adjustments.  In the event of any stock
split, reverse stock split, dividend or other distribution (whether in the form
of cash, Shares, other securities or other property), extraordinary cash
dividend, recapitalization, merger, consolidation, split-up, spin-off,
reorganization, combination, repurchase or exchange of Shares or other
securities, the issuance of warrants or other rights to purchase Shares or other
securities, or other similar corporate transaction or event, the Committee shall
adjust the number and kind of Shares covered by the Restricted Units and other
relevant provisions to the extent necessary to prevent dilution or enlargement
of the benefits or potential benefits intended to be provided by the Restricted
Units.

 

16.                                 Restrictions on Payment of Shares.  Payment
of Shares for your Restricted Units is subject to the conditions that, to the
extent required at the time of delivery, (a) the Shares underlying the
Restricted Units will be duly listed, upon official notice of redemption, upon
the NYSE, and (b) a Registration Statement under the Securities Act of 1933 with
respect to the Shares will be effective.  The Company will not be required to
deliver any Common Stock until

 

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all applicable federal and state laws and regulations have been complied with
and all legal matters in connection with the issuance and delivery of the Shares
have been approved by counsel of the Company.

 

17.                                 Disposition of Securities.  By accepting the
Award, you acknowledge that you have read and understand the Company’s insider
trading policy, and are aware of and understand your obligations under federal
securities laws in respect of trading in the Company’s securities.  The Company
will have the right to recover, or receive reimbursement for, any compensation
or profit realized on the disposition of Shares received for Restricted Units to
the extent that the Company has a right of recovery or reimbursement under
applicable securities laws.

 

18.                                 Plan Terms Govern.  The redemption of
Restricted Units, the disposition of any Shares received for Restricted Units,
and the treatment of any gain on the disposition of these Shares are subject to
the terms of the Plan and any rules that the Committee may prescribe.  The Plan
document, as may be amended from time to time, is incorporated into this Award
Agreement.  Capitalized terms used in this Award Agreement have the meaning set
forth in the Plan, unless otherwise stated in this Award Agreement.  In the
event of any conflict between the terms of the Plan and the terms of this Award
Agreement, the Plan will control.  By accepting the Award, you acknowledge
receipt of the Plan and the prospectus, as in effect on the date of this Award
Agreement.

 

19.                                 Data Privacy.  By accepting the Award, you
hereby explicitly and unambiguously consent to the collection, use and transfer,
in electronic or other form, of your personal data as described in this Award
Agreement and any other grant materials by and among, as applicable, your
Employer, the Company and its Subsidiaries (or former Subsidiaries as are deemed
necessary) for the exclusive purpose of implementing, administering and managing
your participation in the Plan.

 

You understand that the Company and the Employer may hold certain personal
information about you, including, but not limited to, your name, home address
and telephone number, date of birth, social insurance number or other
identification number, salary, nationality, job title, any Shares or
directorships held in the Company, details of all Restricted Units or any other
entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in your favor, for the exclusive purpose of implementing,
administering and managing the Plan (“Data”).

 

You understand that Data may be transferred to any third parties assisting the
Company with the implementation, administration and management of the Plan.  You
understand that these recipients of the Data may be located in the United States
or elsewhere, and that the recipients’ country (e.g., the United States) may
have different data privacy laws and protections than your country.  You
understand that you may request a list with the names and addresses of any
potential recipients of the Data by contacting your local Human Resources
Representative.  You authorize the Company and the recipients assisting the
Company (presently or in the future) with implementing, administering and
managing the Plan to receive, possess, use, retain and transfer the Data, in
electronic or other form, for the sole purpose of implementing, administering
and managing your participation in the Plan.  You understand that Data will be
held only as long as is necessary to implement, administer and manage your
participation in the Plan.  You understand that you may, at any time, view Data,
request additional information about the storage and

 

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processing of Data, require any necessary amendments to Data or refuse or
withdraw the consents herein, in any case without cost, by contacting in writing
your local Human Resources Representative.  You understand, however, that
refusing or withdrawing your consent may affect your ability to participate in
the Plan.  For more information on the consequences of your refusal to consent
or withdrawal of consent, you understand that you may contact your local Human
Resources Representative.

 

20.                                 Nature of Grant.  By accepting the Award,
you acknowledge that:

 

(a)                                  the Plan is established voluntarily by the
Company, it is discretionary in nature and it may be modified, amended,
suspended or terminated by the Company at any time;

 

(b)                                 the grant of the Restricted Units is
voluntary and occasional and does not create any contractual or other right to
receive future grants of Restricted Units, or benefits in lieu of Restricted
Units, even if Restricted Units have been granted repeatedly in the past;

 

(c)                                  all decisions with respect to future
Restricted Unit grants, if any, will be at the sole discretion of the Company;

 

(d)                                 your participation in the Plan shall not
create a right to further employment with the Employer and shall not interfere
with the ability of the Employer to terminate your employment relationship at
any time;

 

(e)                                  you are voluntarily participating in the
Plan;

 

(f)                                    the Restricted Units and the Shares
subject to the Restricted Units are extraordinary items that do not constitute
part of your ordinary ongoing compensation;

 

(g)                                 the Restricted Units and the Shares subject
to the Restricted Units are not intended to replace any pension rights or
compensation;

 

(h)                                 the Restricted Units and the Shares subject
to the Restricted Units are not part of normal or expected compensation or
salary for any purposes, including, but not limited to, calculating any
severance, resignation, termination, redundancy, dismissal, end of service
payments, bonuses, long-service awards, pension or retirement or welfare
benefits or similar payments and in no event should be considered as
compensation for, or relating in any way to, past services for the Company, the
Employer or any Subsidiary of the Company;

 

(i)                                     the Restricted Unit grant and your
participation in the Plan will not be interpreted to form an employment contract
or relationship with the Company or any Subsidiary of the Company;

 

(j)                                     the future value of the underlying
Shares is unknown and cannot be predicted with certainty;

 

(k)                                  in consideration of the grant of the
Restricted Units, no claim or entitlement to compensation or damages shall arise
from forfeiture of the Restricted Units resulting from termination of your
employment with the Company or the Employer (for any reason whatsoever and
whether or not in breach of local labor laws) and you irrevocably release the
Company and the Employer from any such claim that may arise; if, notwithstanding
the foregoing, any such claim is found by a court of competent jurisdiction to
have arisen, you shall be deemed irrevocably to have waived your entitlement to
pursue such claim;

 

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(l)                                 the Restricted Units and the benefits under
the Plan, if any, will not automatically transfer to another company in the case
of a merger, take-over or transfer of liability;

 

(m)                               payment of your Restricted Units is not
secured by a trust, insurance contract or other funding medium, and you do not
have any interest in any fund or specific asset of the Company by reason of this
Award or the account established on your behalf; and

 

(n)                                 you have no rights as a stockholder of the
Company pursuant to the Restricted Units until Shares are actually delivered to
you.

 

21.                                 No Advice Regarding Grant.  The Company is
not providing any tax, legal or financial advice, nor is the Company making any
recommendations regarding your participation in the Plan or your acquisition or
sale of the underlying Shares.  You are hereby advised to consult with your own
personal tax, legal and financial advisors regarding your participation in the
Plan before taking any action related to the Plan.

 

22.                                 Incorporation of Other Agreements.  This
Award Agreement and the Plan constitute the entire understanding between you and
the Company regarding the Restricted Units.  This Award Agreement supercedes any
prior agreements, commitments or negotiations concerning the Restricted Units.

 

23.                                 Severability.  The invalidity or
unenforceability of any provision of this Award will not affect the validity or
enforceability of the other provisions of the Agreement, which will remain in
full force and effect.  Moreover, if any provision is found to be excessively
broad in duration, scope or covered activity, the provision will be construed so
as to be enforceable to the maximum extent compatible with applicable law.

 

24.                                 Delayed Payment.  Notwithstanding anything
in this Award Agreement to the contrary, if the Employee (i) is subject to US
Federal income tax on any part of the payment of the Restricted Units, (ii) is a
“specified employee” within the meaning of section 409A(a)(2)(B) of the Internal
Revenue Code and the regulations thereunder, and (iii) is or will become
eligible for Retirement prior to the Normal Vesting of some or all of the
Restricted Units, then any payment of Restricted Units that is made on account
of his separation from service within the meaning of section 409A(a)(2)(A)(i) of
the Internal Revenue Code and the regulations thereunder shall be delayed until
six months following such separation from service.

 

25.                                 Language.  If you have received this Award
Agreement or any other document related to the Plan translated into a language
other than English and if the meaning of the translated version is different
than the English version, the English version will control.

 

26.                                 Electronic Delivery.  The Company may, in
its sole discretion, decide to deliver any documents related to current or
future participation in the Plan by electronic means.  You hereby consent to
receive such documents by electronic delivery and agree to participate in the
Plan through an on-line or electronic system established and maintained by the
Company or a third party designated by the Company.

 

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27.                                 Imposition of Other Requirements.   The
Company reserves the right to impose other requirements on your participation in
the Plan, on the Restricted Units and on any Shares acquired under the Plan, to
the extent the Company determines it is necessary or advisable in order to
comply with local law or facilitate the administration of the Plan, and to
require you to sign any additional agreements or undertakings that may be
necessary to accomplish the foregoing.

 

By accepting this Award, you agree to the following:

 

(i)                                     you have carefully read, fully
understand and agree to all of the terms and conditions described in this Award
Agreement and the Plan; and

 

(ii)                                  you understand and agree that this Award
Agreement and the Plan constitute the entire understanding between you and the
Company regarding the Award, and that any prior agreements, commitments or
negotiations concerning the Restricted Units are replaced and superseded.

 

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