Exhibit 10.5

UNITED TECHNOLOGIES CORPORATION

DEFERRED COMPENSATION PLAN

(As amended and restated effective January 1, 2005)

ARTICLE I—PREAMBLE

United Technologies Corporation established the United Technologies Deferred
Compensation Plan effective April 1, 1985. Pursuant to such Plan, certain
eligible executives of the Corporation, its Subsidiaries and Affiliates deferred
all or a portion of their compensation earned with respect to 1985 and 1986. No
compensation earned after 1986 was deferred under the Plan until the Plan was
amended and restated effective December 15, 1993 to offer eligible executives
the opportunity to defer all or a portion of Compensation earned or otherwise
payable in 1994 and subsequent years. The Plan has been amended from time to
time since 1993.

The Plan is hereby amended and restated, effective January 1, 2005, to reflect
the requirements of Section 409A of the Internal Revenue Code. The Plan, as
amended and restated, applies to deferrals that were earned or vested after
December 31, 2004. Amounts that were earned and vested (within the meaning of
Section 409A) before January 1, 2005, and any subsequent increases in these
amounts that are permitted to be treated as grandfathered benefits under
Section 409A, are subject to and shall continue to be governed by the terms of
the Prior Plan as set forth in Appendix A.

From January 1, 2005 through December 31, 2008, the Plan has been operated in
good faith compliance with Section 409A in accordance with guidance provided by
the Internal Revenue Service.

 

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ARTICLE II—DEFINITIONS

Beneficiary means the person, persons or entity designated on an electronic or
written form by the Participant to receive the value of his or her Plan Account
in the event of the Participant’s death. If the Participant fails to designate a
Beneficiary, or the Beneficiary (and any contingent Beneficiary) does not
survive the Participant, the value of the Participant’s Plan Account will be
paid to the estate of the Participant.

Benefit Reduction Contribution means a contribution by the Corporation to the
Participant’s Plan Account to recognize the reduction in the value of employer
matching or other contributions under any of the Corporation’s savings or other
tax qualified defined contribution retirement plans as a result of the reduction
of such Participant’s Compensation pursuant to this Plan.

Code means the Internal Revenue Code of 1986, as amended from time to time, and
any successor thereto. Reference to any section of the Internal Revenue Code
shall include any final regulations or other published guidance interpreting
that section.

Committee means the United Technologies Corporation Deferred Compensation
Committee, which is responsible for the administration of the Plan. The
Corporation’s Pension Administration Committee shall appoint the Committee’s
members.

Compensation means base salary and Incentive Compensation Payments otherwise
payable to a Participant by a UTC Company and considered to be wages for
purposes of federal income tax withholding, but before any deferral of
Compensation pursuant to the Plan. Compensation does not include foreign service
premiums and allowances, compensation realized from Long Term Incentive Plan
awards or other types of awards.

 

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Corporation means United Technologies Corporation.

Credited Interest Account means the Investment Fund that is valued in the manner
set forth in Section 5.2.

Deferral Period means the period prior to the receipt of Compensation deferred
hereunder.

“Disability” means permanent and total disability as determined under the
Corporation’s long-term disability plan applicable to the Participant, or if
there is no such plan applicable to the Participant, “Disability” means a
determination of total disability by the Social Security Administration;
provided that, in either case, the Participant’s condition also qualifies as a
“disability” for purposes of Section 409A(a)(2)(C) of the Code.

Election Form means the enrollment form provided by the Committee to
Participants electronically or in paper form for the purpose of deferring
Compensation under the Plan. Each Participant’s Election Form must specify: the
amount to be deferred from base salary and/or from any Incentive Compensation
Payment with respect to the following calendar year; the respective amounts to
be allocated to the Participant’s Retirement Account and/or Special Purpose
Account or Accounts; the percentage allocation among the Investment Funds with
respect to each such Account; and if not previously elected for an Account, the
method of distribution of each such Account; and the Deferral Period for each
Special Purpose Account. There will be a separate Election Form for each
calendar year.

Incentive Compensation Payment means amounts awarded to a Participant pursuant
to the Corporation’s Annual Executive Incentive Compensation Plan.

 

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Investment Fund means the Credited Interest Account, the S&P 500 Account, the
UTC Stock Unit Account or such other investment option as may be established by
the Committee from time to time. The value of Participants’ Accounts shall be
adjusted to replicate the performance of the applicable Investment Funds.
Amounts allocated to any Investment Fund do not result in any investment in
actual assets corresponding to the Investment Fund.

Participant means an executive of a UTC Company who is paid from a US payroll,
files a U.S. income tax return, and who elects to defer Compensation under the
Plan.

Plan means the United Technologies Corporation Deferred Compensation Plan as
amended and restated effective September 1, 2002, and as amended from time to
time thereafter.

Plan Account means the aggregate value of all Special Purpose Accounts and the
Retirement Account, but excluding accounts under the Prior Plan. Accounts under
the Prior Plan will be valued and administered separately in accordance with the
terms and procedures in effect under the Prior Plan.

Prior Plan means the United Technologies Corporation Deferred Compensation Plan,
as in effect on October 3, 2004, as set forth in Appendix A. All amounts earned
and vested under the Prior Plan, and any subsequent increases in these amounts
that are permitted to be treated as grandfathered benefits under Section 409A,
shall continue to be subject to the terms and conditions of the Prior Plan and
shall not be affected by this amendment and restatement.

Retirement Account means a Plan Account maintained on behalf of the Participant
that is targeted for distribution following the Participant’s Retirement.

 

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Retirement means Separation from Service on or after age 50 and attainment of
age 65; Separation from Service on or after age 50 and attainment of at least
age 55 and a minimum of 10 or more years of “continuous service” (as defined in
the UTC Employee Retirement Plan as in effect on January 1, 2008); or a Rule of
65 termination.

Retirement Date means the date of a Participant’s Retirement.

“Rule of 65” Termination means Separation from Service on or after age 50 and
before age 55, with a combination of age and years of “continuous service” (as
defined in the UTC Employee Retirement Plan as in effect on January 1, 2008)
equal to at least 65.

Separation from Service means a Participant’s termination of employment with all
UTC Companies, other than by reason of death, or Disability that qualifies as a
“separation from service” for purposes of Section 409A of the Code. A Separation
from Service will be deemed to occur where the Participant and the UTC Company
that employs the Participant reasonably anticipate that the bona fide level of
services the Participant will perform (whether as an employee or as an
independent contractor) for UTC Companies will be permanently reduced to a level
that is less than thirty-seven and a half percent (37.5%) of the average level
of bona fide services the Participant performed during the immediately preceding
36 months (or the entire period the Participant has provided services if the
Participant has been providing services to the UTC Companies for less than 36
months). A Participant shall not be considered to have had a Separation from
Service as a result of a transfer from one UTC Company to another UTC Company.

S&P 500 Account means an Investment Fund that is valued in the manner set forth
in Section 5.4.

 

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Special Purpose Account means a Plan Account maintained on behalf of the
Participant with a targeted distribution date in the calendar year specified by
the Participant. The minimum Deferral Period is five (5) calendar years
following the end of the calendar year in which the Account is established; and
the first payment from an Account must commence no later than in the calendar
year in which the Participant attains age 72.

Specified Employee means each of the 50 highest-paid executives of the
Corporation and its Subsidiaries, effective annually as of March 31st, based on
annual salary and incentive compensation paid in the prior year. The term
includes both U.S. and non-U.S. employees.

UTC Common Stock means the common stock of United Technologies Corporation.

UTC Company means United Technologies Corporation or any entity controlled by or
under common control with United Technologies Corporation within the meaning of
Section 414(b) or (c) of the Code (but substituting “at least 20 percent” for
“at least 80 percent” as the control threshold used in applying Sections 414(b)
and (c)).

UTC Stock Unit Account means the Investment Fund that is valued in the manner
set forth in Section 5.3.

ARTICLE III—ELIGIBILITY AND PARTICIPATION

Section 3.1—Eligibility

Each employee of a UTC Company who is classified as an eligible Participant as
of December 31 of the current year will be eligible to elect to defer
Compensation under the Plan in respect of the immediately following calendar
year in accordance with the terms of the Plan and the rules and

 

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procedures established by the Committee. Newly hired executives (or employees
promoted to executive level) are eligible to elect to defer base salary during
the current calendar year if they make an election within 30 calendar days from
their hire date or promotion date.

Section 3.2—Participation

Each eligible Participant may elect to participate in the Plan with respect to
any calendar year for which the Committee offers the opportunity to defer
Compensation by timely filing with the Committee an Election Form, properly
completed in accordance with Section 4.1. Participation in the Plan is entirely
voluntary.

ARTICLE IV—PARTICIPANT ELECTIONS AND DESIGNATIONS

Section 4.1—Election

An eligible Participant may,, on or before the election deadline established by
the Committee, make an electronic or written election on the Election Form
provided by the Committee to defer Compensation for the immediately following
calendar year.

Section 4.2—Election Amount

An eligible Participant must designate in the Election Form the dollar amount of
base salary that will be deferred during such calendar year, and/or the
percentage or dollar amount of any Incentive Compensation Payment otherwise
payable with respect to services performed during such calendar year that will
be deferred under the Plan. The minimum dollar amount that a Participant may
defer under the Plan for any calendar year is $5,000. The maximum amount that a
Participant may defer under the Plan for any calendar year is 70% of base salary
and/or 100% of any Incentive Compensation Payment.

 

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Section 4.3—Election Date

For an election to defer base salary, an electronic or written Election Form
must be completed and submitted to the Committee no later than the December 31
immediately preceding the calendar year to which the election applies, or such
earlier date as the Committee may specify. A deferral election shall be
effective only if the individual making the election is still an eligible
Participant at the election deadline. Except as provided below in Section 4.8
(Change in Election), the choices reflected on the Participant’s Election Form
shall be irrevocable on the election deadline. If an eligible executive fails to
submit a properly completed Election Form by the election deadline, the
executive will be ineligible to defer base salary under the Plan for the
immediately following calendar year.

For an election to defer any Incentive Compensation Payment with respect to
services to be performed in the current calendar year and otherwise payable in
the immediately following calendar year, an electronic or written Election Form
must be completed and submitted to the Committee no later than the June 30 of
the current calendar year, or such earlier date as the Committee may specify. A
deferral election shall be effective only if the individual making the election
is still an eligible Participant as of the election deadline. Except as provided
below in Section 4.8 (Change in Election), the choices reflected on the
Participant’s Election Form shall be irrevocable on the election deadline. If an
eligible executive fails to submit a properly completed Election Form by the
election deadline, the executive will be ineligible to defer Incentive
Compensation under the Plan with respect to services to be performed in the
current calendar year.

 

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Section 4.4—Deferral Period

Each Participant shall specify in the Election Form, in whole percentages, how
the amounts to be deferred in the immediately following calendar year are to be
allocated among the Participant’s Retirement Account and any Special Purpose
Accounts established for the Participant. To the extent that the Participant
fails to make an effective allocation among the available accounts, the deferral
shall be allocated entirely to the Participant’s Retirement Account. A
Participant may elect to defer into a Special Purpose Account that has not
previously been established, with a Deferral Period ending on a Specific
Deferral Date that is at least five (5) calendar years following the end of the
calendar year in which the Account is established (but not later than the
Participant’s 72nd birthday). If the Participant’s 72nd birthday falls prior to
the completion of this five (5) year period, the Participant must defer into the
Retirement Account only.

Section 4.5—Distribution Election

At the time the Participant first elects to defer an amount to the Participant’s
Retirement Account or to a Special Purpose Account, the Participant must further
make an election to have the Participant’s Retirement or Special Purpose Account
distributed in a lump sum or in two to fifteen annual installments. The
Participant may elect a different form of distribution for the Retirement
Account and for each Special Purpose Account. If no distribution election is
made with respect to a Participant’s Retirement Account or Special Purpose
Account, the Account will be distributed in a lump sum.

 

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Section 4.6—Investment Fund Allocations

When completing the Election Form, the Participant must allocate the amounts to
be deferred, in whole percentages, among the available Investment Funds. To the
extent that the Participant fails to make an effective allocation among the
available Investment Funds, the deferral shall be allocated entirely to the
Credited Interest Account.

Participants may reallocate their existing Plan Accounts among the available
Investment Funds as permitted by the Committee, generally once per year. Such
reallocations shall be in whole percentages and, unless otherwise specified by
the Committee, shall be effective the first business day of the calendar year
following the date of the reallocation election.

Section 4.7—Change in Election

A Participant who has made an election to defer Compensation under the Plan may
make a one time irrevocable election to extend the Deferral Period for a
Retirement Account and/or any Special Purpose Account. A Participant may also
make a one time irrevocable election to change the form of distribution for the
Retirement and/or any Special Purpose Account. A Participant may change his or
her election, as provided in this Section 4.8, for some accounts and not for
others; provided that the Participant may change his or her election only once
for the Retirement Account and only once for each Special Purpose Account. With
respect to each Special Purpose Account, the extended Deferral Period shall end
not less than five (5) years following the date on which distribution would
otherwise have occurred. With respect to the Retirement Account, the extended
Deferral Period is five years form the date on which the Retirement Account
would otherwise have commenced payment.

 

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A deferral extension election and/or change to the form of distribution must
meet all of the following requirements:

(a) The new election must be made at least twelve months prior to the date on
which payments will commence under the current election (and the new election
shall be ineffective if the payment commencement date under the current election
occurs within twelve months after the date of the new election);

(b) The new election will not take effect until at least twelve months after the
date when the new election is submitted in a manner acceptable to the Committee;

(c) The new payment commencement date must be five years later than the date on
which payments would commence under the current election; and

(d) In no case may a Participant extend the Deferral Period for a Special
Purpose Account beyond the Participant’s 72nd birthday. If the Participant’s
72nd birthday falls less than five (5) years after the date on which payments
would commence under the current election, the Participant is not eligible to
extend his or her Deferral Period or to change the form of distribution for the
Special Purpose Account.

Section 4.8—Designation of Beneficiary

Each Participant shall designate a Beneficiary for his or her Plan Account on an
electronic or written form provided by the Committee. A Participant may change
such designation on an electronic or written form acceptable to the Committee
and received by the Committee at any time before the Participant’s death. In the
event that no Beneficiary designation is filed with the Committee, or if the

 

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Beneficiary (and any contingent Beneficiary) does not survive the Participant,
all amounts deferred hereunder will be paid to the estate of the Participant. If
a Participant designates the Participant’s spouse as the Participant’s
Beneficiary, that designation shall not be revoked or otherwise altered or
affected by any: (a) change in the marital status of the Participant;
(b) agreement between the Participant and such spouse; or (c) judicial decree
(such as a divorce decree) affecting any rights that the Participant and such
spouse might have as a result of their marriage, separation, or divorce; it
being the intent of the Plan that any change in the designation of a Beneficiary
hereunder may be made by the Participant only in accordance with the procedures
set forth in this Section 4.8. In the event of the death of a Participant,
distributions shall be made in accordance with Section 6.5.

ARTICLE V—PLAN ACCOUNTS

Section 5.1—Accounts

Deferred amounts that were earned and vested before January 1, 2005, and any
subsequent increases in these amounts that are permitted to be treated as
grandfathered benefits under Section 409A of the Code, shall be maintained in
separate accounts and shall remain subject to the terms and conditions of the
Prior Plan. The Prior Plan accounts are not intended to be subject to
Section 409A of the Code. No amendment to Appendix A that would constitute a
“material modification” for purposes of Section 409A shall be effective unless
the amending instrument states that it is intended to materially modify Appendix
A and to cause the Prior Plan to become subject to Section 409A. Although the
Prior Plan accounts are not intended to be subject to Section 409A, neither the
UTC Companies nor any director, officer, or other representative of a UTC
Company shall be liable for any adverse tax consequence suffered by a
Participant or Beneficiary if a Prior Plan account becomes subject to
Section 409A.

 

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Deferred amounts that were earned or vested after December 31, 2004, will be
allocated to a Retirement Account and/or one or more Special Purpose Accounts as
elected by the Participant. The Committee will establish the maximum number of
Special Purpose Accounts.

Participants’ Plan Accounts shall be allocated or reallocated among Investment
Funds in accordance with each Participant’s instructions in the manner set forth
in Section 4.6.

Section 5.2—Valuation of Credited Interest Account

Deferred amounts allocated to the Credited Interest Account will be credited
daily with a rate of interest equal to the average interest rate on 10-Year
Treasury Bonds as of the last business day of each month from January through
October in the calendar year prior to the calendar year in which the interest is
credited, plus 1%.

Section 5.3—Valuation of UTC Stock Unit Account

Deferred Compensation allocated to the UTC Stock Unit Account will be converted
to Stock Units, including fractional Stock Units. A UTC Stock Unit is equal to
the closing price of one share of UTC Common Stock as reported on the composite
tape of the New York Stock Exchange. The number of Stock Units will be
calculated by dividing the amount of Compensation deferred by the closing price
of UTC Common Stock on the date when the deferred amount is credited to the
Participant’s UTC Stock Unit Account. UTC Stock Units held in the UTC Stock Unit
Account on a dividend payment date will be credited with dividend equivalent
payments equal to the Corporation’s declared dividend on UTC Common Stock (if
any). Such dividend equivalent payments will be converted to additional UTC
Stock Units and fractional units using the closing price of UTC Common Stock as
of the date such dividends are credited to the Participant’s UTC Stock Unit
Account.

 

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Section 5.4—Valuation of S&P 500 Account

Deferred amounts allocated to the S&P 500 Account will be converted to S&P
Account units based on the closing share price of the Vanguard 500 Index Fund as
of date the deferred amount is credited to the Participant’s S&P 500 Account.
The value of the S&P 500 Account units will fluctuate on each business day based
on the performance of the Vanguard 500 Index Fund.

Section 5.5—Allocation to Accounts

During the year of deferral, deferred amounts will be allocated to the
Participant’s Plan Account and Investment Funds as of the date the deferred
amounts would otherwise have been paid to the Participant.

Section 5.6—Crediting of Benefit Reduction Contribution

At the end of each calendar year, the Committee will determine if any Benefit
Reduction has been incurred with respect to any of the Corporation’s savings
plans or other tax qualified defined contribution retirement plans, and will
credit the amount of such Benefit Reduction to the affected Participant’s Plan
Account as of the last business day of the calendar year. Any such amounts will
be allocated on a pro-rata basis to the Participant’s Retirement Account and
Special Purpose Accounts and Investment Funds in accordance with the
Participant’s deferral elections on file for that calendar year.

Section 5.7—Reports to Participants

The Committee will provide or make available detailed information to
Participants regarding the value of Plan Accounts, distribution elections,
Beneficiary designations, Investment Fund allocations and credited values for
Retirement and Special Purpose Accounts, not less than once per year. Such
information may be provided via electronic media as determined by the Committee.

 

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ARTICLE VI—DISTRIBUTION OF ACCOUNTS

Section 6.1—Timing of Plan Distributions

Except as provided in Section 4.8 (concerning the five-year delay following a
Change in Election), Section 6.3 (concerning Separation from Service before
Attaining Age Fifty), and Section 6.4 (concerning distributions to Specified
Employees), the value of a Participant’s Retirement Account will be distributed
(or begin to be distributed) to the Participant in April of the calendar year
following the Retirement Date. The value of a Participant’s Special Purpose
Account will be distributed (or begin to be distributed) to the Participant in
April of the year specified in the Participant’s initial election or in any
change in election under Section 4.8. This means, for example, that if a
deferral election specifies a Deferral Period until 2015, distribution will
occur in April of 2015.

Section 6.2—Method of Distribution

Except as provided in Section 6.3 (concerning Separation from Service before
Attaining Age Fifty), each Retirement and Special Purpose Account will be
distributed to the Participant in a single lump-sum cash payment, or in a series
of annual cash installment payments, in accordance with the Participant’s
election with respect to each such account. Annual installments shall be payable
to the Participant beginning as of the payment commencement date and continuing
as of each anniversary of the payment commencement date thereafter until all
installments have been paid. To determine the amount of each installment, the
value of the Participant’s Plan Account on the payment date will be multiplied
by a fraction, the numerator of which is one and the denominator of which is the
number of scheduled installments that remain unpaid.

 

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Section 6.3—Separation from Service before Attaining Age Fifty

If a Participant’s Separation from Service occurs before the Participant attains
age fifty (50), the full value of the Participant’s Plan Account will be
distributed to the Participant in a lump-sum payment in April following the
Participant’s Separation from Service (or, if the Participant is a Specified
Employee at the time of his or her Separation from Service, on the date provided
in Section 6.4, below, if later) regardless of the distribution option elected.

If a Participant has a Separation from Service and is later re-hired by a UTC
Company, the Participant’s age at the time of the Participant’s first Separation
from Service will determine how the Participant’s Plan Account at the time of
the first Separation from Service is distributed. If the Participant accumulates
any additional deferrals after the Participant is re-hired, the Plan shall
separately account for the additional deferrals (and related investment gains or
losses), and the Participant’s age at the time of the Participant’s second
Separation from Service will determine how the additional amounts are
distributed.

Section 6.4—Separation from Service of Specified Employees

If the Participant is a Specified Employee on the date of the Participant’s
Separation from Service, any distribution of the Participant’s Plan Account to
the Participant that is made on account of the Participant’s Separation from
Service will not be made or commence earlier than the first day of the seventh
month following the date of Separation from Service. The Plan Account shall
continue to accrue hypothetical investment gains and losses as provided in
Article V until the distribution date.

 

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Section 6.5—Distribution in the Event of Death

In the event of the death of a Participant, the full value of the Participant’s
Plan Account will be distributed to the designated Beneficiary in a lump sum on
the first business day of the month following the Participant’s death.

Section 6.6—Accelerated Distribution in the Case of an Unforeseeable Emergency

(a) Unforeseeable Emergency. The Committee may, upon a Participant’s written
application, agree to an accelerated distribution of some or all of the value of
Participant’s Plan Account upon the showing of an unforeseeable emergency. An
“unforeseeable emergency” is a severe financial hardship to the Participant
resulting from (1) an illness or accident of the Participant, the Participant’s
spouse, the Participant’s Beneficiary, or the Participant’s dependent (as
defined in IRC Section 152, without regard to Section 152(b)(1), (b)(2), and
(d)(1)(B)); (2) loss of the Participant’s property due to casualty; or (3) other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant. Whether a Participant is faced
with an unforeseeable emergency permitting a distribution is to be determined
based on the relevant facts and circumstances of each case. Acceleration will
not be granted if the emergency is or may be relieved through reimbursement or
compensation from insurance or otherwise, by liquidation of the Participant’s
assets (to the extent the liquidation of such assets would not cause severe
financial hardship), or by cessation of deferrals under the Plan.

(b) Amount of Distribution Permitted Upon an Unforeseeable Emergency.
Distributions on account of an unforeseeable emergency, as defined in
Section 6.6(a), shall be limited to the amount reasonably necessary to satisfy
the emergency need. Such amount may include amounts necessary to pay any
Federal, state, local, or foreign income taxes or penalties reasonably
anticipated to result from the distribution.

 

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(c) The Committee will determine from which Special Purpose or Retirement
Accounts and associated Investment Funds hardship distributions will be made.
Any Participant who is an officer or director of the Corporation within the
meaning of Section 16 of the Securities Exchange Act of 1934 is not eligible for
distributions on account of unforeseeable emergency.

Section 6.7—Disability

In the event of the Disability of a Participant, the Participant’s Plan Accounts
will be maintained and distributed in accordance with the Participant’s
elections on file.

Section 6.8—Administrative Adjustments in Payment Date

A payment is treated as being made on the date when it is due under the Plan if
the payment is made on the due date specified by the Plan, or on a later date
that is either (a) in the same calendar year (for a payment whose specified due
date is on or before September 30), or (b) by the 15th day of the third calendar
month following the date specified by the Plan (for a payment whose specified
due date is on or after October 1). A payment also is treated as being made on
the date when it is due under the Plan if the payment is made not more than 30
days before the due date specified by the Plan. In no event will a payment to a
Specified Employee be made or commence earlier than the first day of the seventh
month following the date of Separation from Service. A Participant may not,
directly or indirectly, designate the taxable year of a payment made in reliance
on the administrative rules in this Section 6.9.

 

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ARTICLE VII—AMENDMENT AND TERMINATION OF PLAN

Section 7.1—Amendment

The Corporation may, at any time, amend the Plan in whole or in part, provided
that no amendment may decrease the value of any Plan Accounts as of the date of
such amendment. In the event of any change in law or regulation relating to the
Plan and the tax treatment of Plan Accounts, the Plan shall, without further
action by the Committee, be deemed to be amended to comply with any such change
in law or regulation effective as of the first date necessary to prevent the
taxation, constructive receipt or deemed distribution of Plan Accounts prior to
the date Plan Accounts would be distributed under the provisions of Article VI.

Section 7.2—Plan Suspension and Termination

(a) The Corporation’s Pension Administration Committee, may, at any time,
suspend or terminate the Plan with respect to new or existing Election Forms if,
in its sole judgment, the continuance of the Plan, the tax, accounting, or other
effects thereof, or potential payments thereunder would not be in the best
interest of the Corporation or for any other reason.

(b) In the event of the suspension of the Plan, no additional deferrals shall be
made under the Plan, but all previous deferrals shall accumulate and be
distributed in accordance with the otherwise applicable provisions of the Plan
and the applicable elections on file.

(c) Upon the termination of the Plan with respect to all Participants, and the
termination of all arrangements sponsored by the Corporation or its affiliates
that would be aggregated with the Plan under Section 409A of the Code, the
Corporation shall have the right, in its sole discretion, and

 

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notwithstanding any elections made by the Participant, to pay the Participant’s
Plan Account in a lump sum, to the extent permitted under Section 409A. All
payments that may be made pursuant to this Section 7.2 shall be made no earlier
than the thirteenth month and no later than the twenty-fourth month after the
termination of the Plan. The Corporation may not accelerate payments pursuant to
this Section 7.2 if the termination of the Plan is proximate to a downturn in
the Corporation’s financial health within the meaning of Treas. Reg. section
1.409A-3(j)(4)(ix)(C)(1). If the Corporation exercises its discretion to
accelerate payments under this Section 7.2, it shall not adopt any new
arrangement that would have been aggregated with the Plan under Section 409A
within three years following the date of the Plan’s termination.

Section 7.3—No Consent Required

The consent of any Participant, Beneficiary, or other person shall not be
required with respect to any amendment, suspension, or termination of the Plan.

ARTICLE VIII—GENERAL PROVISIONS

Section 8.1—Unsecured General Creditor

The Corporation’s obligations under the Plan constitute an unfunded and
unsecured promise to pay money in the future. Participants’ and Beneficiaries’
rights under the Plan are solely those of a general unsecured creditor of the
Corporation. No assets will be placed in trust, set aside or otherwise
segregated to fund or offset liabilities in respect of the Plan or Participants’
Plan Accounts.

 

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Section 8.2—Nonassignability

No Participant or Beneficiary or any other person shall have the right to sell,
assign, transfer, pledge, or otherwise encumber any interest in the Plan. All
Plan Accounts and the rights to all payments are unassignable and
non-transferable. Plan Accounts or payment hereunder, prior to actual payment,
will not be subject to attachment or seizure for the payment of any debts,
judgments or other obligations. Plan Accounts or other Plan benefit will not be
transferred by operation of law in the event of a Participant’s or any
Beneficiary’s bankruptcy or insolvency.

Section 8.3—No Contract of Employment

Participation in the Plan shall not be construed to constitute a direct or
indirect contract of employment between any UTC Company and the Participant.
Participants and Beneficiaries will have no rights against any UTC Company
resulting from participation in the Plan other than as specifically provided
herein. Nothing in the Plan shall be deemed to give a Participant the right to
be retained in the service of any UTC Company for any length of time or to
interfere with the right of any UTC Company to terminate a Participant’s
employment prior to the end of any Deferral Period.

Section 8.4—Governing Law

The provisions of the Plan will be construed and interpreted according to the
laws of the State of Connecticut, to the extent not preempted by federal law.

 

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Section 8.5—Validity

If any provision of the Plan is held to be illegal or invalid for any reason,
the remaining provisions of the Plan will be construed and enforced as if such
illegal and invalid provision had never been inserted herein.

Section 8.6—Notice

Any notice or filing required or permitted to be given to the Committee under
the Plan shall be sufficient if sent by first-class mail, to the United
Technologies Corporation Deferred Compensation Committee, 1 Financial Plaza,
Hartford, Connecticut 06101, Attn: Director, Compensation, MS-504. Any notice or
filing required or permitted to be given to any Participant or Beneficiary under
the Plan shall be sufficient if provided either electronically, hand-delivered,
or mailed to the address (or email address, as the case may be) of the
Participant or Beneficiary then listed on the records of the Corporation. Any
such notice will be deemed given as of the date of delivery or, if delivery is
made by mail, as of the date shown on the postmark or email system.

Section 8.7—Successors

The provisions of the Plan shall bind and inure to the benefit of the
Corporation and its successors and assigns. The term successors as used herein
shall include any corporate or other business entity, which by merger,
consolidation, purchase or otherwise acquires all or substantially all of the
business and assets of the Corporation, and successors of any such corporation
or other business entity.

 

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Section 8.8—Incompetence

If the Committee determines, upon evidence satisfactory to the Committee, that
any Participant or Beneficiary to whom a benefit is payable under the Plan is
unable to care for his or her affairs because of illness or accident, any
payment due (unless prior claim therefore shall have been made by a duly
authorized guardian or other legal representative) may be paid, upon appropriate
indemnification of the Committee and the Corporation, to the spouse of the
Participant or other person deemed by the Committee to have incurred expenses
for the benefit of and on behalf of such Participant or Beneficiary. Any such
payment from a Participant’s Plan Account shall be a complete discharge of any
liability under the Plan with respect to the amount so paid.

Section 8.9—Section 409A Compliance.

To the extent that rights or payments under this Plan are subject to
Section 409A of the Internal Revenue Code, the Plan shall be construed and
administered in compliance with the conditions of Section 409A and regulations
and other guidance issued pursuant to Section 409A for deferral of income
taxation until the time the compensation is paid. Any distribution election that
would not comply with Section 409A of the Code shall not be effective for
purposes of this Plan. To the extent that a provision of this Plan does not
comply with Section 409A of the Code, such provision shall be void and without
effect. The Corporation does not warrant that the Plan will comply with
Section 409A of the Code with respect to any Participant or with respect to any
payment In no event shall any UTC Company; any director, officer, or employee of
a UTC Company (other than the Participant); or any member of the Committee be
liable for any additional tax, interest, or penalty incurred by a Participant or
Beneficiary as a result of the Plan’s failure to satisfy the requirements of
Section 409A of the Code, or as a result of the Plan’s failure to satisfy any
other requirements of applicable tax laws.

 

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Section 8.10—Withholding Taxes

The Committee may make any appropriate arrangements to deduct from all deferrals
and payments under the Plan any taxes that the Committee reasonably determines
to be required by law to be withheld from such credits and payments.

ARTICLE IX—ADMINISTRATION AND CLAIMS

Section 9.1—Plan Administration

The Committee shall be solely responsible for the administration and operation
of the Plan. The Committee shall have full and exclusive authority and
discretion to interpret the provisions of the Plan and to establish such
administrative procedures as it deems necessary and appropriate to carry out the
purposes of the Plan.

Any person claiming a benefit, requesting an interpretation or ruling under the
Plan, or requesting information under the Plan shall present the request in
writing to the Committee at United Technologies Corporation, 1 Financial Plaza,
Hartford, Connecticut 06101, Attn: Deferred Compensation Committee. The
Committee shall respond in writing as soon as practicable.

Section 9.2—Claim Procedures

A Participant or Beneficiary who believes that he or she has been denied a
benefit to which he or she is entitled under the Plan (referred to in this
Section 9.2 as a “Claimant”) may file a written request with the Committee
setting forth the claim. The Committee shall consider and resolve the claim as
set forth below.

 

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(a) Upon receipt of a claim, the Committee shall advise the Claimant that a
response will be forthcoming within 90 days. The Committee may, however, extend
the response period for up to an additional 90 days for reasonable cause, and
shall notify the Claimant of the reason for the extension and the expected
response date. The Committee shall respond to the claim within the specified
period.

(b) If the claim is denied in whole or part, the Committee shall provide the
Claimant with a written decision, using language calculated to be understood by
the Claimant, setting forth (1) the specific reason or reasons for such denial;
(2) the specific reference to relevant provisions of this Plan on which such
denial is based; (3) a description of any additional material or information
necessary for the Claimant to perfect his or her claim and an explanation why
such material or such information is necessary; (4) appropriate information as
to the steps to be taken if the Claimant wishes to submit the claim for review;
(5) the time limits for requesting a review of the claim; and (6) the Claimant’s
right to bring an action for benefits under Section 502(a) of ERISA.

(c) Within 60 days after the Claimant’s receipt of the written decision denying
the claim in whole or in part, the Claimant may request in writing that the
Committee review the determination. The Claimant or his or her duly authorized
representative may, but need not, review the relevant documents and submit
issues and comment in writing for consideration by the Committee. If the
Claimant does not request a review of the initial determination within such
60-day period, the Claimant shall be barred from challenging the determination.

(d) Within 60 days after the Committee receives a request for review, it will
review the initial determination. If special circumstances require that the
60-day time period be extended, the Committee will so notify the Claimant and
will render the decision as soon as possible, but no later than 120 days after
receipt of the request for review.

 

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(e) All decisions on review shall be final and binding with respect to all
concerned parties. The decision on review shall set forth, in a manner
calculated to be understood by the Claimant, (1) the specific reasons for the
decision, including references to the relevant Plan provisions upon which the
decision is based; (2) the Claimant’s right to receive, upon request and free of
charge, reasonable access to and copies of all documents, records, and other
information, relevant to his or her benefits; and (3) the Claimant’s right to
bring an action for benefits under Section 502(a) of ERISA.

CERTAIN REGULATORY MATTERS

The Plan is subject to the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”). Because the Plan is an unfunded plan maintained by an
employer primarily for the purpose of providing deferred compensation for a
select group of management or highly compensated employees, the Plan is exempt
from most of ERISA’s requirements. Although the Plan is subject to Part 1
(Reporting and Disclosure) and Part 5 (Administration and Enforcement) of Title
I, Subtitle B of ERISA, the Department of Labor has issued a regulation that
exempts the Plan from most of ERISA’s reporting and disclosure requirements.

 

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TO WHOM SHOULD QUESTIONS CONCERNING THE PLAN BE DIRECTED?

All questions concerning the operation of the Plan (including information
concerning the administrators of the Plan) should be directed to:

Director, Compensation

United Technologies Corporation

1 Financial Plaza, MS 504

Hartford, Connecticut 06101

Telephone: 860-728-6381

 

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Appendix A

This Appendix A sets forth the United Technologies Corporation Deferred
Compensation Plan, as in effect on October 4, 2004 (“Prior Plan”), and as
modified thereafter from time to time in a manner that does not constitute a
“material modification” for purposes of Section 409A. Amounts that were earned
and vested (within the meaning of Section 409A) prior to January 1, 2005, and
any subsequent increases in these amounts that are permitted to be treated as
grandfathered benefits under Section 409A, are generally subject to and shall
continue to be governed by the terms of this Prior Plan.

 

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UNITED TECHNOLOGIES CORPORATION

DEFERRED COMPENSATION PLAN

(As amended and restated effective September 1, 2002)

ARTICLE I—PREAMBLE

United Technologies Corporation established the United Technologies Deferred
Compensation Plan effective April 1, 1985. Pursuant to such Plan, certain
eligible executives of the Corporation deferred all or a portion of their
compensation earned with respect to 1985 and 1986. No compensation earned after
1986 was deferred under the Plan until the Plan was amended and restated
effective December 15, 1993 to offer eligible executives the opportunity to
defer all or a portion of Compensation earned or otherwise payable in 1994 and
subsequent years. The Plan is hereby amended and restated, effective
September 1, 2002, to reflect administrative changes and enhancements.

ARTICLE II—DEFINITIONS

Beneficiary means the person, persons or entity designated by the Participant to
receive the value of his or her Plan Accounts in the event of the Participant’s
death. If the Participant fails to designate a Beneficiary, or the Beneficiary
(and any contingent Beneficiary) does not survive the Participant, the value of
the Participant’s Plan Accounts will be paid to the estate of the Participant.

Benefit Reduction means either a reduction in a Participant’s (or the
Participant’s Beneficiary’s) benefit under any of the Corporation’s defined
benefit pension plans or a reduction in the value of employer matching or other
contributions under any of the Corporation’s savings or other tax qualified
defined contribution retirement plans as a result of the reduction of such
Participant’s Compensation pursuant to this Plan.

Class Year means each calendar year for which Compensation has been deferred
pursuant to the Plan prior to 2003.

 

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Class Year Account means the account established for each Participant for each
Class Year for which Compensation has been deferred under the Plan prior to
January 1, 2003.

Committee means the United Technologies Corporation Deferred Compensation
Committee, which is responsible for the administration of the Plan. The
Corporation’s Pension Administration Committee shall appoint the Committee’s
members.

Compensation means base salary and Incentive Compensation Payments otherwise
payable to a Participant and considered to be wages for purposes of federal
income tax withholding, but before any deferral of Compensation pursuant to the
Plan. Compensation does not include foreign service premiums and allowances,
compensation realized from Long Term Incentive Plan awards or other types of
awards.

Corporation means United Technologies Corporation, its divisions, affiliates and
subsidiaries.

Credited Interest Account means the Investment Fund that is valued in the manner
set forth in Section 5.2.

Deferral Period means the period prior to the receipt of Compensation deferred
hereunder.

Election Form means the enrollment form provided by the Committee to
Participants electronically or in paper form for the purpose of deferring
Compensation under the Plan. Each Participant’s Election Form must specify: the
amount to be deferred from base salary and/or from any Incentive Compensation
Payment with respect to the following calendar year; the respective amounts to
be allocated to the Participant’s Retirement Account and/or Special Purpose
Account or Accounts; the percentage allocation among the Investment Funds with
respect to each such Account; the method of distribution of each such Account;
and the Deferral Period for each Special Purpose Account. There will be a
separate Election Form for each calendar year.

 

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Incentive Compensation Payment means amounts awarded to a Participant pursuant
to the Corporation’s Annual Executive Incentive Compensation Plan.

Investment Fund means the Credited Interest Account, the S&P 500 Account, the
UTC Stock Unit Account or such other investment option as may be established by
the Committee from time to time. The value of Participants’ Accounts shall be
adjusted to replicate the performance of the applicable Investment Fund. Amounts
allocated to any Investment Fund do not result in any investment in actual
assets corresponding to the Investment Fund.

Participant means an executive of the Corporation who is paid from a US payroll,
files a U.S. income tax return, and who elects to defer Compensation under the
Plan.

Plan means the United Technologies Corporation Deferred Compensation Plan as
amended and restated effective September 1, 2002, and as amended from time to
time thereafter.

Plan Accounts means the aggregate value of all Class Year Accounts, Special
Purpose Accounts, and Retirement Account, but excluding accounts under the Prior
Plan. Accounts under the Prior Plan will be valued and administered separately
in accordance with the terms and procedures in effect under the Prior Plan.

Prior Plan means the United Technologies Corporation Deferred Compensation Plan,
as in effect prior to December 15, 1993. All amounts deferred and credited under
the Prior Plan shall continue to be subject to the terms and conditions of the
Prior Plan and shall not be affected by this amendment and restatement.

 

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Retirement Account means a Plan Account maintained on behalf of the Participant
that will be distributed in the manner elected by the Participant commencing in
April of the calendar year following the Participant’s Retirement Date.

Retirement means attainment of age 65; attainment of at least age 55 and a
minimum of 10 or more years of “continuous service” (as defined in one of the
Corporation’s retirement plans); or termination of employment on or after age 50
and before age 55, with a combination of age and years of service equal to at
least 65 (the “Rule of 65”).

Retirement Date means the date a Participant terminates employment from the
Corporation on or after attaining eligibility for Retirement.

S&P 500 Account means an Investment Fund that is valued in the manner set forth
in Section 5.4.

Special Purpose Account means a Plan Account maintained on behalf of the
Participant that will be distributed in the manner elected by the Participant
commencing in April of the calendar year specified by the Participant. The
minimum Deferral Period is five (5) calendar years following the end of the
calendar year for which the Account is established.

UTC Common Stock means the common stock of United Technologies Corporation.

UTC Stock Unit Account means the Investment Fund that is valued in the manner
set forth in Section 5.3.

 

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ARTICLE III—ELIGIBILITY AND PARTICIPATION

Section 3.1—Eligibility

Each employee of the Corporation who is classified as an eligible Participant as
of December 31 will be eligible to elect to defer Compensation under the Plan in
respect of the subsequent calendar year in accordance with the terms of the Plan
and the rules and procedures established by the Committee.

Section 3.2—Participation

Each eligible Participant may elect to participate in the Plan with respect to
any calendar year for which the Committee offers the opportunity to defer
Compensation by timely filing with the Committee an Election Form, properly
completed in accordance with Section 4.1. Participation in the Plan is entirely
voluntary.

ARTICLE IV—PARTICIPANT ELECTIONS

Section 4.1—Election

An eligible Participant may participate in the Plan by executing the Election
Form provided by the Committee for the subsequent calendar year. The eligible
Participant must designate the dollar amount of base salary that will be
deferred during such calendar year, and/or the percentage or dollar amount of
any Incentive Compensation Payment otherwise payable during such calendar year
that will be deferred under the Plan. The minimum dollar amount that a
Participant may defer under the Plan for any calendar year is $5,000. Any
deferral election made in the Election Form is irrevocable and must be completed
and returned to the Committee no later than the December 31 immediately
preceding the calendar year to which the election applies, or such earlier date
as the Committee may specify. If an eligible executive fails to return a
properly completed Election Form by such date, the executive will be ineligible
to defer Compensation under the Plan for the following calendar year.

 

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Section 4.2—Investment Fund Allocations

When completing the Election Form, the Participant must allocate the amounts to
be deferred, in whole percentages divisible by 10, among the available
Investment Funds.

Participants may reallocate their existing post-1993 Class Year Accounts,
Special Purpose Accounts and Retirement Account among the available Investment
Funds as permitted by the Committee, generally once per year. Such reallocations
shall be in whole percentages divisible by 10 and, unless otherwise specified by
the Committee, shall be effective January 1 of the calendar year following the
date of the reallocation election.

Section 4.3—Designation of Beneficiary

Each Participant shall designate a Beneficiary for his or her Plan Accounts on a
form provided by the Committee. Such designation may be changed on a form
acceptable to the Committee at any time by the Participant. In the event that no
Beneficiary designation is filed with the Committee, or if the Beneficiary (and
contingent Beneficiary) does not survive the Participant, all amounts deferred
hereunder will be paid to the estate of the Participant in a lump sum. If a
Participant designates the Participant’s spouse as the Participant’s
Beneficiary, that designation shall not be revoked or otherwise altered or
affected by any: (a) change in the marital status of the Participant;
(b) agreement between the Participant and such spouse; or (c) judicial decree
(such as a divorce decree) affecting any rights that the Participant and such
spouse might have as a result of their marriage, separation, or divorce; it
being the intent of the Plan that any change in the designation of a Beneficiary
hereunder may be made by the Participant only in accordance with the procedures
set forth in this Section 4.3. In the event of the death of a Participant,
distributions shall be made in accordance with Section 6.4.

 

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Section 4.4—Deferral Period

Each Participant shall specify in the Election Form the Deferral Period for
amounts to be deferred in the following calendar year. The minimum Deferral
Period for a Special Purpose Account is five (5) calendar years following the
end of the calendar year in which the Account is established. Participants may
defer Compensation into a Retirement Account until April of the calendar year
following their Retirement Date.

Section 4.5—Distribution Schedule

Each Participant shall specify in the Election Form whether the value of the
Participant’s Retirement or Special Purpose Account shall be distributed in a
single lump-sum cash payment or in a series of annual cash installment payments
for a specified number of years (not to exceed 15 years).

ARTICLE V—PLAN ACCOUNTS

Section 5.1—Accounts

Prior to 2003, the Committee established a Class Year Account for each
Participant with respect to each Class Year for which the Participant elected to
defer Compensation under the Plan. Each Class Year Account will be maintained
separately.

Amounts deferred in 2003 and subsequent calendar years will be allocated to a
Retirement Account and/or one or more Special Purpose Accounts as elected by the
Participant. The Committee will establish the maximum number of Special Purpose
Accounts.

 

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Participants’ Plan Accounts shall be allocated or reallocated among Investment
Funds in accordance with each Participant’s instructions in the manner set forth
in Section 4.2.

Section 5.2—Valuation of Credited Interest Account

Deferred amounts allocated to the Credited Interest Account will be credited
with a rate of interest equal to the average interest rate on 10-Year Treasury
Bonds as of the last business day of each month from January through October in
the prior calendar year, plus 1%.

Section 5.3—Valuation of UTC Stock Unit Account

Deferred Compensation allocated to the UTC Stock Unit Account will be converted
to Stock Units, or fractional Stock Units. A UTC Stock Unit is equal to the
closing price of one share of UTC Common Stock as reported on the composite tape
of the New York Stock Exchange. The number of Stock Units will be calculated by
dividing the amount of Compensation deferred by the closing price of UTC Common
Stock on the date the deferred amounts otherwise would have been paid. Stock
Units held in the UTC Stock Unit Account will be credited with a dividend
payment equal to the Corporation’s declared dividend on UTC Common Stock (if
any). Such dividend equivalent payments will be converted to additional Stock
Units or fractional units using the closing price of UTC Common Stock as of the
date such dividends are credited to the Participant’s UTC Stock Unit Account.

Section 5.4—Valuation of S&P 500 Account

Deferred amounts allocated to the S&P 500 Account will be converted to S&P
Account units based on the closing share price of the Vanguard 500 Index Fund as
of date the deferred amount is credited to the Participant’s S&P 500 Account.
The value of the S&P 500 Account units will fluctuate on a daily basis based on
the performance of the Vanguard 500 Index Fund.

 

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Section 5.5—Allocation to Accounts

During the year of deferral, deferred amounts will be allocated to the
Participant’s Plan Accounts and Investment Funds as of the date the deferred
amounts would otherwise have been paid.

Section 5.6—Reports to Participants

The Committee will provide or make available detailed information to
Participants regarding the value of Plan Accounts, distribution elections,
Beneficiary designations, Investment Fund allocations and credited values for
Class Year, Retirement and Special Purpose Accounts, not less than once per
year. Such information may be provided via electronic media as determined by the
Committee.

 

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ARTICLE VI—DISTRIBUTION OF ACCOUNTS

Section 6.1—Timing of Plan Distributions

The value of a Participant’s Retirement Account will be distributed (or begin to
be distributed) in April of the calendar year following the Retirement Date. The
value of a Participant’s Special Purpose Account will be distributed (or begin
to be distributed) in April of the specified year. This means, for example, that
if a deferral election specifies a Deferral Period until 2015, distribution will
occur in April of 2015.

The value of a Participant’s Class Year Account will be distributed (or begin to
be distributed) in April of the last year of the Deferral Period. Upon
Retirement, the value of a Participant’s Class Year Account will be distributed
(or begin to be distributed) in April next following the Retirement Date, or in
April of the calendar year following the Retirement Date, as elected.

Section 6.2—Method of Distribution

Each Class Year, Retirement and Special Purpose Account will be distributed in a
single lump-sum cash payment, or in a series of annual cash installment
payments, in accordance with the Participant’s election with respect to each
such Account.

Section 6.3—Termination of Employment

In the event of termination of employment prior to a Participant’s Retirement
Date, during or after the Deferral Period with respect to any Class Year,
Retirement or Special Purpose Account, the full value of the Participant’s Plan
Accounts will be distributed in a lump-sum cash payment in April following the
date of termination, regardless of the distribution option elected.

 

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Section 6.4—Distribution in the Event of Death

In the event of the death of a Participant prior to attaining eligibility for
Retirement, and before the end of the Deferral Period with respect to any Plan
Account, the full value of such Plan Accounts will be distributed to the
designated Beneficiary in a lump sum as soon as administratively feasible.

In the event of the death of a Participant prior to attaining eligibility for
Retirement, but after the end of the Deferral Period with respect to any Plan
Account, the full value of such Plan Accounts will be distributed to the
designated Beneficiary in accordance with the Participant’s distribution
election on file.

In the event of death of a Participant after attaining eligibility for
Retirement, the full value of the Participant’s Plan Accounts will be
distributed to the Beneficiary in accordance with the Participant’s distribution
elections on file.

If the Beneficiary is the Participant’s estate, the full value of the
Participant’s Plan Accounts will be paid in a single lump sum as soon as
administratively feasible following the Participant’s date of death.

In the event of the death of the Beneficiary (and any contingent Beneficiary)
while receiving distributions from the Plan, the full value of the applicable
Plan Accounts will be paid in a single lump sum to such Beneficiary’s estate as
soon as administratively feasible.

 

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Section 6.5—Hardship Distribution

The Committee may, in its sole discretion, upon finding that the Participant (or
Beneficiary in the event of a Participant’s death) has suffered an unforeseen,
severe and immediate financial emergency, permit such Participant to withdraw a
portion of the value of the Participant’s Plan Accounts in an amount sufficient
to eliminate the hardship. Financial hardship distributions will be made only if
the Committee determines that the Participant is unable to resolve the financial
emergency through other means reasonably available to the Participant. Financial
hardship distributions will be made following the Committee’s determination of a
qualifying financial emergency on the basis of the value of the Participant’s
Plan Accounts as of the most recent date available. The Committee will determine
from which Special Purpose, Retirement or Class Year Accounts and associated
Investment Funds hardship distributions will be made. Any Participant who is an
officer or director of the Corporation within the meaning of Section 16 of the
Securities Exchange Act of 1934 is not eligible for financial hardship
distributions.

Section 6.6—Disability

In the event of the disability of a Participant, as determined under the
Corporation’s Long Term Disability Plan, the Participant’s Plan Accounts will be
maintained and distributed in accordance with the Participant’s elections on
file.

Section 6.7—Distribution from Supplemental Account

The Committee will effect distributions from supplemental retirement plans with
respect to Benefit Reductions incurred in any of the Corporation’s defined
benefit pension plans at the same time, in the same manner and in the required
amounts such that when combined with benefits provided by the defined benefit
pension plans in which a Participant incurred a Benefit

 

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Reduction, the total amount received by a Participant (or Beneficiary) will
equal the amount of pension benefit that would otherwise have been paid had the
Participant not participated in this Plan.

At the end of each calendar year, the Committee will determine if any Benefit
Reduction has been incurred with respect to any of the Corporation’s savings
plans or other tax qualified defined contribution retirement plans, and will
credit the amount of such Benefit Reduction to the affected Participant’s Plan
Accounts as of the last business day of the calendar year. Any such amounts will
be allocated on a pro-rata basis to the Participant’s Plan Accounts and
Investment Funds in accordance with the Participant’s deferral elections on file
for that calendar year.

ARTICLE VII—AMENDMENT AND TERMINATION OF PLAN

Section 7.1—Amendment

The Corporation may, at any time, amend the Plan in whole or in part, provided
that no amendment may decrease the value of any Plan Accounts as of the date of
such amendment. In the event of any change in law or regulation relating to the
Plan and the tax treatment of Plan Accounts, the Plan shall, without further
action by the Committee, be deemed to be amended to comply with any such change
in law or regulation effective the first date necessary to prevent the taxation,
constructive receipt or deemed distribution of Plan Accounts prior to the date
Plan Accounts would be distributed under the provisions of Article VI.

Section 7.2—Plan Suspension and Termination

The Corporation’s Pension Administration Committee, may, at any time, suspend or
terminate the Plan with respect to new or existing Election Forms if, in its
sole judgment, the

 

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continuance of the Plan, the tax, accounting, or other effects thereof, or
potential payments hereunder would not be in the best interest of the
Corporation or for any other reason. In the event of the suspension of the Plan,
no additional deferral shall be made under the Plan, but all previous deferrals
shall accumulate and be distributed in accordance with the otherwise applicable
provisions of the Plan and the applicable elections on file. In the event of the
termination of the Plan, each Participant will receive, in a lump-sum cash
payment, the value of his or her Plan Accounts.

Section 7.3—No Consent Required

The consent of any Participant, Beneficiary, or other person shall not be
required with respect to any amendment, suspension, or termination of the Plan.

ARTICLE VIII—GENERAL PROVISIONS

Section 8.1—Unsecured General Creditor

The Corporation’s obligations under the Plan constitute an unfunded and
unsecured promise to pay money in the future. Participants’ and Beneficiaries’
rights under the Plan are solely those of a general unsecured creditor of the
Corporation. No assets will be placed in trust, set aside or otherwise
segregated to fund or offset liabilities in respect of the Plan or Participants’
Plan Accounts.

Section 8.2—Nonassignability

No Participant or Beneficiary or any other person shall have right to sell,
assign, transfer, pledge, or otherwise encumber any interest in the Plan. All
Plan Accounts and the rights to all

 

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payments are unassignable and non-transferable. Plan Accounts or payment
hereunder, prior to actual payment, will not be subject to attachment or seizure
for the payment of any debts, judgments or other obligations. Plan Accounts or
other Plan benefit will not be transferred by operation of law in the event of a
Participant’s or any Beneficiary’s bankruptcy or insolvency.

Section 8.3—No Contract of Employment

Participation in the Plan shall not be construed to constitute a direct or
indirect contract of employment between the Corporation and the Participant.
Participants and Beneficiaries will have no rights against the Corporation
resulting from participation in the Plan other than as specifically provided
herein. Nothing in the Plan shall be deemed to give a Participant the right to
be retained in the service of the Corporation for any length of time or to
interfere with the right of the Corporation to terminate a Participant’s
employment prior to the end of any Deferral Period.

Section 8.4—Governing Law

The provisions of the Plan will be construed and interpreted according to the
laws of the State of Connecticut, to the extent not preempted by federal law.

Section 8.5—Validity

If any provision of the Plan is held to be illegal or invalid for any reason,
the remaining provisions of the Plan will be construed and enforced as if such
illegal and invalid provision had never been inserted herein.

 

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Section 8.6—Notice

Any notice or filing required or permitted to be given to the Committee under
the Plan shall be sufficient if sent by first-class mail, to the United
Technologies Corporation Deferred Compensation Committee, 1 Financial Plaza,
Hartford, Connecticut 06101, Attn: R. Larry Acorn, Director, Compensation,
MS-504. Any notice or filing required or permitted to be given to any
Participant or Beneficiary under the Plan shall be sufficient if provided either
electronically, hand-delivered, or mailed to the address (or email address, as
the case may be) of the Participant or Beneficiary then listed on the records of
the Corporation. Any such notice will be deemed given as of the date of delivery
or, if delivery is made by mail, as of the date shown on the postmark or email
system.

Section 8.7—Successors

The provisions of the Plan shall bind and inure to the benefit of the
Corporation and its successors and assigns. The term successors as used herein
shall include any corporate or other business entity, which by merger,
consolidation, purchase or otherwise acquires all or substantially all of the
business and assets of the Corporation, and successors of any such corporation
or other business entity.

Section 8.8—Incompetence

If the Committee determines, upon evidence satisfactory to the Committee, that
any Participant or Beneficiary to whom a benefit is payable under the Plan is
unable to care for their affairs because of illness or accident, any payment due
(unless prior claim therefore shall have been made by a duly authorized guardian
or other legal representative) may be paid, upon appropriate indemnification of
the Committee and the Corporation, to the spouse of the Participant or other
person deemed by the Committee to have incurred expenses for the benefit of and
on behalf of such Participant or Beneficiary. Any such payment from a
Participant’s Plan Accounts shall be a complete discharge of any liability under
the Plan with respect to the amount so paid.

 

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ARTICLE IX—ADMINISTRATION AND CLAIMS

Section 9.1—Plan Administration

The Committee shall be solely responsible for the administration and operation
of the Plan. The Committee shall have full and exclusive authority and
discretion to interpret the provisions of the Plan and to establish such
administrative procedures as it deems necessary and appropriate to carry out the
purposes of the Plan.

Any person claiming a benefit, requesting an interpretation or ruling under the
Plan, or requesting information under the Plan shall present the request in
writing to the Committee which shall respond in writing as soon as practicable.

Section 9.2—Claim Procedures

If a Participant or Beneficiary requests a benefit or payment under the Plan and
such claim or request is denied, the Committee will provide a written notice of
denial which will specify (a) the reason for denial, with specific reference to
the Plan provisions on which the denial is based and (b) a description of any
additional material or information that may be required with respect to the
claim and an explanation of why such information is necessary.

If a claim or request is denied or if the Participant or Beneficiary receives no
response within 60 days, the Participant or Beneficiary may request review by
writing to the Committee. The Committee will review the claim or request, and
may request additional information or materials that it deems appropriate to the
resolution of any issues presented. The decision on

 

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review will normally be made by the Committee within 60 days of its receipt of
the request for review but may be extended up to 120 days from such date. The
Committee’s decision will be in writing and will state the basis for its
decision and shall be conclusive and binding on all parties.

 

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