Exhibit 10.4

 

TYCO INTERNATIONAL

 

SEVERANCE PLAN FOR U.S. OFFICERS AND EXECUTIVES

 

Amended and Restated as of January 1, 2009

 

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TABLE OF CONTENTS

 

 

 

 

Page

ARTICLE I

 

BACKGROUND, PURPOSE AND TERM OF PLAN

1

Section 1.01

 

Purpose of the Plan

1

Section 1.02

 

Term of the Plan

1

Section 1.03

 

Compliance with Code Section 409A

1

 

 

 

 

ARTICLE II

 

DEFINITIONS

2

Section 2.01

 

“Alternative Position”

2

Section 2.02

 

“Annual Bonus”

2

Section 2.03

 

“Base Salary”

2

Section 2.04

 

“Board”

2

Section 2.05

 

“Cause”

2

Section 2.06

 

“COBRA”

2

Section 2.07

 

“Code”

2

Section 2.08

 

“Committee”

2

Section 2.09

 

“Company”

2

Section 2.10

 

“Effective Date”

3

Section 2.11

 

“Eligible Employee”

3

Section 2.12

 

“Employee”

3

Section 2.13

 

“Employer”

3

Section 2.14

 

“ERISA”

3

Section 2.15

 

“Exchange Act”

3

Section 2.16

 

“Involuntary Termination”

3

Section 2.17

 

“Key Employee”

3

Section 2.18

 

“Notice Pay”

3

Section 2.19

 

“Officer”

3

Section 2.20

 

“Participant”

3

Section 2.21

 

“Permanent Disability”

4

Section 2.22

 

“Plan”

4

Section 2.23

 

“Plan Administrator”

4

Section 2.24

 

“Postponement Period”

4

Section 2.25

 

“Release”

4

Section 2.26

 

“Separation from Service”

4

Section 2.27

 

“Separation from Service Date”

4

Section 2.28

 

“Service”

4

Section 2.29

 

“Severance Benefits”

4

Section 2.30

 

“Severance Period”

5

Section 2.31

 

“Subsidiary”

5

Section 2.32

 

“Voluntary Termination”

5

 

 

 

 

ARTICLE III

 

PARTICIPATION AND ELIGIBILITY FOR BENEFITS

6

Section 3.01

 

Participation

6

Section 3.02

 

Conditions

6

 

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TABLE OF CONTENTS

(continued)

 

 

 

 

Page

ARTICLE IV

 

DETERMINATION OF SEVERANCE BENEFITS

8

Section 4.01

 

Amount of Severance Benefits Upon Involuntary Termination

8

Section 4.02

 

Voluntary Termination; Termination for Death or Permanent Disability

10

Section 4.03

 

Termination for Cause

10

Section 4.04

 

Reduction of Severance Benefits

10

 

 

 

 

ARTICLE V

 

METHOD AND DURATION OF SEVERANCE BENEFIT PAYMENTS

11

Section 5.01

 

Method of Payment

11

Section 5.02

 

Other Arrangements

11

Section 5.03

 

Code Section 409A

11

Section 5.04

 

Termination of Eligibility for Benefits

12

 

 

 

 

ARTICLE VI

 

CONFIDENTIALITY, COVENANT NOT TO COMPETE AND NOT TO SOLICIT

13

Section 6.01

 

Confidential Information

13

Section 6.02

 

Non-Competition

13

Section 6.03

 

Non-Solicitation

13

Section 6.04

 

Non-Disparagement

14

Section 6.05

 

Reasonableness

14

Section 6.06

 

Equitable Relief

14

Section 6.07

 

Survival of Provisions

15

 

 

 

 

ARTICLE VII

 

THE PLAN ADMINISTRATOR

16

Section 7.01

 

Authority and Duties

16

Section 7.02

 

Compensation of the Plan Administrator

16

Section 7.03

 

Records, Reporting and Disclosure

16

 

 

 

 

ARTICLE VIII

 

AMENDMENT, TERMINATION AND DURATION

17

Section 8.01

 

Amendment, Suspension and Termination

17

Section 8.02

 

Duration

17

 

 

 

 

ARTICLE IX

 

DUTIES OF THE COMPANY AND THE COMMITTEE

18

Section 9.01

 

Records

18

Section 9.02

 

Payment

18

Section 9.03

 

Discretion

18

 

 

 

 

ARTICLE X

 

CLAIMS PROCEDURES

19

Section 10.01

 

Claim

19

Section 10.02

 

Initial Claim

19

Section 10.03

 

Appeals of Denied Administrative Claims

19

Section 10.04

 

Appointment of the Named Appeals Fiduciary

20

Section 10.05

 

Arbitration; Expenses

20

 

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TABLE OF CONTENTS

(continued)

 

 

 

 

Page

ARTICLE XI

 

MISCELLANEOUS

21

Section 11.01

 

Nonalienation of Benefits

21

Section 11.02

 

Notices

21

Section 11.03

 

Successors

21

Section 11.04

 

Other Payments

21

Section 11.05

 

No Mitigation

21

Section 11.06

 

No Contract of Employment

21

Section 11.07

 

Severability of Provisions

21

Section 11.08

 

Heirs, Assigns, and Personal Representatives

22

Section 11.09

 

Headings and Captions

22

Section 11.10

 

Gender and Number

22

Section 11.11

 

Unfunded Plan

22

Section 11.12

 

Payments to Incompetent Persons

22

Section 11.13

 

Lost Payees

22

Section 11.14

 

Controlling Law

22

 

 

 

 

SCHEDULE A

 

SEVERANCE BENEFITS

A-1

 

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ARTICLE I

BACKGROUND, PURPOSE AND TERM OF PLAN

 

Section 1.01                            Purpose of the Plan.  The purpose of the
Plan is to provide Eligible Employees with certain compensation and benefits as
set forth in the Plan in the event the Eligible Employee’s employment with the
Company or a Subsidiary is terminated due to an Involuntary Termination.  The
Plan is not intended to be an “employee pension benefit plan” or “pension plan”
within the meaning of Section 3(2) of ERISA.  Rather, this Plan is intended to
be a “welfare benefit plan” within the meaning of Section 3(1) of ERISA and to
meet the descriptive requirements of a plan constituting a “severance pay plan”
within the meaning of regulations published by the Secretary of Labor at Title
29, Code of Federal Regulations, section 2510.3-2(b).  Accordingly, the benefits
paid by the Plan are not deferred compensation and no employee shall have a
vested right to such benefits.

 

Section 1.02                            Term of the Plan.  The Plan shall
generally be effective as of the Effective Date and shall supersede any prior
plan, program or policy under which the Company or any Subsidiary provided
severance benefits prior to the Effective Date of the Plan.  The Plan shall
continue until terminated pursuant to Article VIII of the Plan.

 

Section 1.03                            Compliance with Code Section 409A.  The
terms of this Plan are intended to, and shall be interpreted so as to, comply in
all respects with the provisions of Code Section 409A and the regulations and
rulings promulgated thereunder.

 

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ARTICLE II

DEFINITIONS

 

Section 2.01                            “Alternative Position” shall mean a
position with the Company that:

 

(a)                                  is not more than 75 miles each way from the
location of the Employee’s current position (for positions that are essentially
mobile, the mileage does not apply); and

 

(b)                                 provides the Employee with pay and benefits
(not including perquisites or long term incentive compensation) that are
comparable in the aggregate to the Employee’s current position.

 

The Plan Administrator has the exclusive discretionary authority to determine
whether a position is an Alternative Position.

 

Section 2.02                            “Annual Bonus” shall mean 100% of the
Participant’s target annual bonus.

 

Section 2.03                            “Base Salary” shall mean the annual base
salary in effect as of the Participant’s Separation from Service Date.

 

Section 2.04                            “Board” shall mean the Board of
Directors of the Company, or any successor thereto, or a committee thereof
specifically designated for purposes of making determinations hereunder.

 

Section 2.05                            “Cause” shall mean an Employee’s
(i) substantial failure or refusal to perform duties and responsibilities of his
or her job as required by the Company, (ii) violation of any fiduciary duty owed
to the Company, (iii) conviction of a felony or misdemeanor, (iv) dishonesty,
(v) theft, (vi) violation of Company rules or policy, or (vii) other egregious
conduct, that has or could have a serious and detrimental impact on the Company
and its employees.  The Plan Administrator, in its sole and absolute discretion,
shall determine Cause.  Examples of “Cause” may include, but are not limited to,
excessive absenteeism, misconduct, insubordination, violation of Company policy,
dishonesty, and deliberate unsatisfactory performance (e.g., Employee refuses to
improve deficient performance).

 

Section 2.06                            “COBRA” shall mean the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended and the regulations
promulgated thereunder.

 

Section 2.07                            “Code” shall mean the Internal Revenue
Code of 1986, as amended and the regulations promulgated thereunder.

 

Section 2.08                            “Committee” shall mean the Compensation
and Human Resources Committee of the Board or such other committee appointed by
the Board to assist the Company in making determinations required under the Plan
in accordance with its terms.  The “Committee” may delegate its authority under
the Plan to an individual or another committee.

 

Section 2.09                            “Company” shall mean Tyco International
Ltd.  Unless it is otherwise clear from the context, Company shall generally
include participating Subsidiaries.

 

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Section 2.10                            “Effective Date” shall mean January 1,
2009.

 

Section 2.11                            “Eligible Employee” shall mean an
Employee employed in the United States who is an Officer, or in career bands 1
and 2, who is not covered under any other severance plan or program sponsored by
the Company or a Subsidiary.  If there is any question as to whether an Employee
is deemed an Eligible Employee for purposes of the Plan, the Senior Vice
President — Human Resources, Tyco International shall make the determination.

 

Section 2.12                            “Employee” shall mean an individual
employed by Tyco International Ltd. or a Subsidiary as a common law employee on
the United States payroll of Tyco International Ltd. or a Subsidiary, and shall
not include any person working for the Company through a temporary service or on
a leased basis or who is hired by the Company as an independent contractor,
consultant, or otherwise as a person who is not an employee for purposes of
withholding federal employment taxes, as evidenced by payroll records or a
written agreement with the individual, regardless of any contrary governmental
or judicial determination or holding relating to such status or tax withholding.

 

Section 2.13                            “Employer” shall mean the Company or any
Subsidiary with respect to which this Plan has been adopted.

 

Section 2.14                            “ERISA” shall mean the Employee
Retirement Income Security Act of 1974, as amended, and the regulations
promulgated thereunder.

 

Section 2.15                            “Exchange Act” shall mean the Securities
Exchange Act of 1934, as amended and the regulations promulgated thereunder.

 

Section 2.16                            “Involuntary Termination” shall mean the
date that a Participant experiences a Company-initiated Separation from Service
for any reason other than Cause, Permanent Disability or death, as provided
under and subject to the conditions of Article III.

 

Section 2.17                            “Key Employee” shall mean an Employee
who, at any time during the 12-month period ending on the identification date,
is a “specified employee” under Code Section 409A, as determined by the
Committee or its delegate.  The determination of Key Employees, including the
number and identity of persons considered specified employees and the
identification date, shall be made by the Committee or its delegate in
accordance with the provisions of Code Section 409A and the regulations
promulgated thereunder.

 

Section 2.18                            “Notice Pay” shall mean the amounts that
a Participant is eligible to receive pursuant to Article IV of the Plan.

 

Section 2.19                            “Officer” shall mean any individual who
is an officer, as such term is defined pursuant to Rule 16a-1(f) as promulgated
under the Exchange Act, of the Company.  For purposes of this definition,
Officer shall also mean any officer of any of the Company’s Subsidiaries who
perform policy making functions, within the context of Rule 16a-1(f).

 

Section 2.20                            “Participant” shall mean any Eligible
Employee who meets the requirements of Article III and thereby becomes eligible
for salary continuation and other benefits under the Plan.

 

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Section 2.21                            “Permanent Disability” shall mean that
an Employee has a permanent and total incapacity from engaging in any employment
for the Employer for physical or mental reasons.  A “Permanent Disability” shall
be deemed to exist if the Employee meets the requirements for disability
benefits under the Employer’s long-term disability plan or under the
requirements for disability benefits under the Social Security law (or similar
law outside the United States, if the Employee is employed in that jurisdiction)
then in effect, or if the Employee is designated with an inactive employment
status at the end of a disability or medical leave.

 

Section 2.22                            “Plan” means the Tyco International
Severance Plan for U.S. Officers and Executives (f/k/a the Tyco International
(US) Inc. Severance Plan for U.S. Officers and Executives) as set forth herein,
and as the same may from time to time be amended.

 

Section 2.23                            “Plan Administrator” shall mean the
individual(s) appointed by the Committee to administer the terms of the Plan as
set forth herein and if no individual is appointed by the Committee to serve as
the Plan Administrator for the Plan, the Plan Administrator shall be the Senior
Vice President — Human Resources, Tyco International Management Company (or the
equivalent).  Notwithstanding the preceding sentence, in the event the Plan
Administrator is entitled to Severance Benefits under the Plan, the Committee or
its delegate shall act as the Plan Administrator for purposes of administering
the terms of the Plan with respect to the Plan Administrator.  The Plan
Administrator may delegate all or any portion of its authority under the Plan to
any other person(s).

 

Section 2.24                            “Postponement Period” shall mean, for a
Key Employee, the period of six months after the Key Employee’s Separation from
Service Date (or such other period as may be required by Code Section 409A)
during which deferred compensation may not be paid to the Key Employee under
Code Section 409A.

 

Section 2.25                            “Release” shall mean the Separation of
Employment Agreement and General Release, as provided by the Company.

 

Section 2.26                            “Separation from Service” shall mean
“separation from service” within the meaning of Code
Section 409A(a)(2)(A)(i) and applicable regulations and rulings thereunder.

 

Section 2.27                            “Separation from Service Date” shall
mean, with respect to a Participant, the date on which such Participant
experiences a Separation from Service.

 

Section 2.28                            “Service” shall mean the total number of
years and completed months the Participant was an Employee of the Company. 
Service with any predecessor employer or with a Subsidiary prior to the
Subsidiary’s becoming part of the Company shall be recognized only to the extent
specified in the merger or acquisition documentation relating to the
Subsidiary.  Periods of authorized leave of absence, such as military leave,
will be included in Service only to the extent required by applicable law.  Any
period of employment with the Company, a Subsidiary, or a predecessor employer
for which an Eligible Employee previously received severance benefits, shall be
excluded from Service.

 

Section 2.29                            “Severance Benefits” shall mean the
salary continuation and other benefits that a Participant is eligible to receive
pursuant to Article IV of the Plan.

 

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Section 2.30                            “Severance Period” shall mean the period
during which a Participant is receiving Severance Benefits under this Plan.

 

Section 2.31                            “Subsidiary” shall mean (i) a subsidiary
company (wherever incorporated) as defined by the law of the Company’s place of
incorporation , (ii) any separately organized business unit, whether or not
incorporated, of the Company, (iii) any employer that is required to be
aggregated with the Company pursuant to section 414 of the Internal Revenue Code
of 1986, as amended, and regulations issued thereunder, and (iv) any service
recipient or employer that is within a controlled group of corporations with the
Company as defined in Code Sections 1563(a)(1), (2) and (3) where the phrase “at
least 50%” is substituted in each place “at least 80%” appears or is with the
Company as part of a group of trades or businesses under common control as
defined in Code Section 414(c) and Treas. Reg. Section 1.414(c)-2 where the
phrase “at least 50%” is substituted in each place “at least 80%” appears,
provided, however, that when the relevant determination is to be based upon
legitimate business criteria (as described in Treas. Reg.
Section 1.409A-1(b)(5)(iii)(E) and Section 1.409A-1(h)(3)), the phrase “at least
20%” shall be substituted in each place “at least 80%” appears as described
above with respect to both a controlled group of corporations and trades or
business under common control.

 

Section 2.32                            “Voluntary Termination” shall mean any
Separation from Service due to retirement or termination of employment that is
not initiated by the Company or any Subsidiary.

 

5

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ARTICLE III

PARTICIPATION AND ELIGIBILITY FOR BENEFITS

 

Section 3.01                            Participation.  Each Eligible Employee
in the Plan who incurs an Involuntary Termination and who satisfies the
conditions of Section 3.02 shall be eligible to receive the Severance Benefits
described in the Plan.  An Eligible Employee shall not be eligible to receive
any other severance benefits from the Company or Subsidiary on account of an
Involuntary Termination, unless otherwise provided in the Plan.  In addition,
any Eligible Employee who is a party to an employment agreement with the Company
pursuant to which such Eligible Employee is entitled to severance benefits shall
be ineligible to participate in the Plan.

 

Section 3.02                            Conditions.

 

(a)                                  Eligibility for any Severance Benefits is
expressly conditioned on the occurrence of the following within 60 days after
the Participant’s Separation from Service Date: (i) execution by the Participant
of a Release in the form provided by the Company, (ii) compliance by the
Participant with all the terms and conditions of such Release, (iii) the
Participant’s written agreement to the confidentiality, non-solicitation, and
non-disparagement provisions in Article VI during and after the Participant’s
employment with the Company, and (iv) to the extent permitted in Section 4.04 of
the Plan, execution of a written agreement that authorizes the deduction of
amounts owed to the Company prior to the payment of any Severance Benefit (or in
accordance with any other schedule as the Committee may, in its sole discretion,
determine to be appropriate).  If the Committee determines, in its sole
discretion, that the Participant has not fully complied with any of the terms of
the Agreement and/or Release, the Committee may deny Severance Benefits not yet
in pay status or discontinue the payment of the Participant’s Severance Benefit
and may require the Participant, by providing written notice of such repayment
obligation to the Participant, to repay any portion of the Severance Benefit
already received under the Plan.  If the Committee notifies a Participant that
repayment of all or any portion of the Severance Benefit received under the Plan
is required, such amounts shall be repaid within thirty (30) calendar days of
the date the written notice is sent.  Any remedy under this subsection (a) shall
be in addition to, and not in place of, any other remedy, including injunctive
relief, that the Company may have

 

(b)                                 An Eligible Employee will not be eligible to
receive severance benefits under any of the following circumstances:

 

(i)                                     The Eligible Employee voluntarily
terminates employment:

 

(ii)                                  The Eligible Employee resigns employment
before the job-end date specified by the Employer or while the Employer still
desires the Eligible Employee’s services;

 

(iii)                               The Eligible Employee’s employment is
terminated for Cause;

 

(iv)                              The Eligible Employee voluntarily retires;

 

6

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(v)                                 The Eligible Employee’s employment is
terminated due to the Eligible Employee’s death or Permanent Disability;

 

(vi)                              The Eligible Employee does not return to work
within six (6) months of the onset of an approved leave of absence, other than a
personal, educational or military leave and/or as otherwise required by
applicable statute;

 

(vii)                           The Eligible Employee does not return to work
within three (3) months of the onset of a personal or educational leave of
absence;

 

(viii)                        The Eligible Employee does not satisfy the
conditions for Severance Benefits set forth in Section 3.02(a);

 

(ix)                                The Eligible Employee continues in
employment with the Company or a Subsidiary or has the opportunity to continue
in employment in the same or in an Alternative Position with the Company or a
Subsidiary; or

 

(x)                                   The Eligible Employee’s employment with
the Employer terminates as a result of a sale of stock or assets of the
Employer, merger, consolidation, joint venture or a sale or outsourcing of a
business unit or function, or other transaction, and the Eligible Employee
accepts employment, or has the opportunity to continue employment in an
Alternative Position, with the purchaser, joint venture, or other acquiring or
outsourcing entity, or a related entity of either the Company or the acquiring
entity.  The payment of Severance Benefits in the circumstances described in
this subsection (x) would result in a windfall to the Eligible Employee, which
is not the intention of the Plan.

 

(c)                                  The Plan Administrator has the sole
discretion to determine an Eligible Employee’s eligibility to receive Severance
Benefits.

 

(d)                                 An Eligible Employee returning from approved
military leave will be eligible for Severance Benefits if: (i) he/she is
eligible for reemployment under the provisions of the Uniformed Services
Employment and Reemployment Rights Act (USERRA); (ii) his/her pre-military leave
job is eliminated; and (iii) the Employer’s circumstances are changed so as to
make reemployment in another position impossible or unreasonable, or
re-employment would create an undue hardship for the Employer.  If the Eligible
Employee returning from military leave qualifies for Severance Benefits, his/her
severance benefits will be calculated as if he/she had remained continuously
employed from the date he/she began his/her military leave.  The Eligible
Employee must also satisfy any other relevant conditions for payment set forth
in this Section, including execution of a Release.

 

7

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ARTICLE IV

DETERMINATION OF SEVERANCE BENEFITS

 

Section 4.01                            Amount of Severance Benefits Upon
Involuntary Termination. The Severance Benefits to be provided to an Eligible
Employee who incurs an Involuntary Termination and is determined to be eligible
for Severance Benefits shall be as follows:

 

(a)                                  Notice Pay.  Except for Officers, each
Eligible Employee who meets the eligibility requirements for a Severance Benefit
under Section 3.01 shall receive 30 calendar days notice as a Notice Period.  In
the event that the Company determines that a Participant’s last day of work
shall be prior to the end of his or her Notice Period, such Employee shall be
entitled to pay in lieu of notice for the balance of such Notice Period.  Notice
Pay paid to an Eligible Employee shall be in addition to, and shall not be
offset against, the Severance Benefits the Participant may be entitled to
receive under this Article IV.  An Eligible Employee who does not sign, or who
revokes his or her signature on, a Release shall only be eligible for Notice
Pay.  Unless otherwise permitted by the applicable plan documents or laws, an
Eligible Employee will not be eligible to apply for short-term disability,
long-term disability and/or workers’ compensation during the Notice Period, or
anytime thereafter.

 

(b)                                 Severance Benefits.

 

(i)                                     Salary continuation shall be provided
during the Severance Period applicable to the Participant as set forth under the
benefits schedule appended to the Plan.  During the Severance Period, the
Participant shall receive his or her Base Salary (net of deductions and tax
withholdings, as applicable) in equal installments over the Severance Period,
per normal payroll cycles.  The salary continuation payment shall commence no
earlier than the end of the revocation period applicable to the Release.

 

(ii)                                  The Participant shall also receive a cash
payment equal to his or her Annual Bonus during the Severance Period applicable
to the Participant as set forth under the benefits schedule appended to the
Plan.  Such bonus payment shall be paid to the Participant in equal installments
over the Severance Period (e.g., 12 months, 18 months or 24 months).  The bonus
payment shall be paid at the same time as the Salary continuation benefits in
Section 4.01(b)(i).

 

(c)                                  Bonus.  Subject to the discretion of the
Company and to the extent set forth in the applicable plans, the Participant
shall be entitled to a payment equal to the amount (if any) of Annual Bonus to
which he or she would have become entitled under the annual bonus or incentive
plan in which the Participant participated in the year of his or her Separation
from Service, assuming the Participant had remained in employment through the
end of such year and based on actual performance, pro rated for the portion of
the year prior to the Separation from Service.

 

(d)                                 Medical, Dental and Health Care
Reimbursement Account Benefits.  The Participant shall continue to be eligible
to participate in the medical, dental and Health Care Reimbursement Account
coverage in effect at the date of his or her termination (or generally

 

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comparable coverage) for himself or herself and, where applicable, his or her
spouse and dependents, as the same may be changed from time to time for
employees of the Company generally, as if Participant had continued in
employment during the lesser of (i) the Severance Period, or (ii) twelve (12)
months (the “Coverage Period”).  The Participant shall be responsible for the
payment of the employee portion of the medical, dental and Health Care
Reimbursement Account contributions that are required during the Severance
Period and such contributions shall be made within the time period and in the
amounts that other employees are required to pay to the Company for similar
coverage.  The Participant’s failure to pay the applicable contributions shall
result in the cessation of the applicable medical and dental coverage for the
Participant and his or her spouse or domestic partner and dependents.  In the
event the Severance Period exceeds twelve months, the Participant will receive a
cash lump-sum payment from the Company equal to the projected value of the
employer portion of the premiums for medical and dental benefits for the time
period between the end of the Coverage Period and the remainder of the Severance
Period.  Such payment shall be made within sixty (60) days from the end of the
Coverage Period.  Notwithstanding any other provision of this Plan to the
contrary, in the event that a Participant commences employment with another
company at any time during the Severance Period, the Participant may cease
receiving coverage under the Company’s medical and dental plans.  Within thirty
(30) days of Participant’s commencement of employment with another company,
Participant shall provide the Company written notice of such employment and
provide information to the Company regarding the medical and dental benefits
provided to Participant by his or her new employer.  The COBRA continuation
coverage period under section 4980B of the Code shall run concurrently with the
Severance Period.

 

(e)                                  Stock Options.  All stock options held by
the Participant as of his or her Separation from Service Date which would have
become vested and exercisable during the twelve (12) month period after
Participant’s Separation from Service Date shall become vested and exercisable
on each such date within such twelve (12) month period, unless the Participant’s
option agreement covering such options provides for alternative vesting
treatment.  All outstanding stock options held by Participant that are vested
and exercisable as of the Separation from Service Date and all stock options
held by the Participant that become vested and exercisable within the twelve
(12) month period following Participant’s Separation from Service Date, shall be
exercisable for the greater of (i) the period set forth in Participant’s option
agreement covering such options, or (ii) twelve (12) months from the Separation
from Service Date.  In no event, however, shall an option be exercisable beyond
its original expiration date.

 

(f)                                    Restricted Stock, Restricted Units and
Performance Units. All restricted stock, restricted units and performance units
held by the Participant as of his or her Separation from Service Date shall be
treated as provided under and in accordance with the Tyco International Ltd.
2004 Stock and Incentive Plan, as amended, modified to the extent provided in
the terms and conditions of the applicable award certificate.

 

(g)                                 Outplacement Services.  The Company may, in
its sole and absolute discretion, pay the cost of outplacement services for the
Participant at the outplacement agency that the Company regularly uses for such
purpose or, provided the Senior Vice President — Human Resources, Tyco
International Management Company provides prior approval, at an outpatient
agency selected by the Participant; provided, however, that the period of
outplacement services shall not exceed twelve (12) months from Participant’s
Separation from Service Date.

 

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Section 4.02                            Voluntary Termination; Termination for
Death or Permanent Disability.  If the Eligible Employee’s employment terminates
on account of (i) the Eligible Employee’s Voluntary Resignation, (ii) death, or
(iii) Permanent Disability, then the Eligible Employee shall not be entitled to
receive Severance Benefits under this Plan and shall be entitled only to those
benefits (if any) as may be available under the Company’s then-existing benefit
plans and policies at the time of such termination.

 

Section 4.03                            Termination for Cause.  If any Eligible
Employee’s employment terminates on account of termination by the Company for
Cause, the Eligible Employee shall not be entitled to receive Severance Benefits
under this Plan and shall be entitled only to those benefits that are legally
required to be provided to the Eligible Employee.  Notwithstanding any other
provision of the Plan to the contrary, if the Committee or the Plan
Administrator determines that an Eligible Employee has engaged in conduct that
constitutes Cause at any time prior to the Eligible Employee’s Separation from
Service Date, any Severance Benefit payable to the Eligible Employee under
Section 4.01 of the Plan shall immediately cease, and the Eligible Employee
shall be required to return any Severance Benefits paid to the Eligible Employee
prior to such determination.  The Company may withhold paying Severance Benefits
under the Plan pending resolution of an inquiry that could lead to a finding
resulting in Cause.  If the Company has offset other payments owed to the
Eligible Employee under any other plan or program, it may, in its sole
discretion, waive its repayment right solely with respect to the amount of the
offset so credited.

 

Section 4.04                            Reduction of Severance Benefits.  With
respect to amounts paid under the Plan that are not subject to Code Section 409A
and the regulations promulgated thereunder, the Plan Administrator reserves the
right to make deductions in accordance with applicable law for any monies owed
to the Company by the Participant or the value of Company property that the
Participant has retained in his/her possession.  With respect to amounts paid
under the Plan that are subject to Code Section 409A and the regulations
promulgated thereunder, the Plan Administrator reserves the right to make
deductions in accordance with applicable law for any monies owed to the Company
by the Participant or the value of the Company property that the Participant has
retained in his/her possession; provided, however, that such deductions cannot
exceed $5,000 in the aggregate.

 

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ARTICLE V

METHOD AND DURATION OF SEVERANCE BENEFIT PAYMENTS

 

Section 5.01                            Method of Payment.  The Severance
Benefit to which a Participant is entitled, as determined pursuant to
Section 4.01, shall be paid in accordance with normal payroll practices over the
Severance Period; provided, however, that the annual bonus amount payable
pursuant to Section 4.01(c) shall be paid at the same time as bonuses would be
payable under the applicable bonus plan or program, or successor plan, and that
COBRA coverage under Section 4.01(d) shall be provided or paid in accordance
with the provisions of that subsection.  In no event will interest be credited
on the unpaid balance for which a Participant may become eligible.  Payment
shall be made by mailing to the last address provided by the Participant to the
Company or such other reasonable method as determined by the Plan
Administrator.  All payments of Severance Benefits are subject to applicable
federal, state and local taxes and withholdings.  In the event of the
Participant’s death prior to the completion of all payments being made, the
remaining payments shall be paid to the Participant’s estate in a single lump
sum payment within sixty (60) days following the date of the Participant’s
death.

 

Section 5.02                            Other Arrangements.  The Severance
Benefits under this Plan are not additive or cumulative to severance or
termination benefits that a Participant might also be entitled to receive under
the terms of a written employment agreement, a severance agreement or any other
arrangement with the Employer.  As a condition of participating in the Plan, the
Eligible Employee must expressly agree that this Plan supersedes all prior
agreements, and sets forth the entire Severance Benefit the Eligible Employee is
entitled to while an Eligible Employee in the Plan.  The provisions of this Plan
may provide for payments to the Eligible Employee under certain compensation or
bonus plans under circumstances where such plans would not provide for payment
thereof.  It is the specific intention of the Company that the provisions of
this Plan shall supersede any provisions to the contrary in such plans, to the
extent permitted by applicable law, and such plans shall be deemed to be have
been amended to correspond with this Plan without further action by the Company
or the Board.

 

Section 5.03                            Code Section 409A.

 

(a)                                  Notwithstanding any provision of the Plan
to the contrary, if required by Code Section 409A and if a Participant is a Key
Employee, no Benefits shall be paid to the Participant during the Postponement
Period.  If a Participant is a Key Employee and payment of Benefits is required
to be delayed for the Postponement Period under Code Section 409A, the
accumulated amounts withheld on account of Code Section 409A shall be paid in a
lump sum payment within 30 days after the end of the Postponement Period and no
interest or other adjustment shall be made for the delayed payment.  If the
Participant dies during the Postponement Period prior to the payment of
Benefits, the amounts withheld on account of Code Section 409A shall be paid to
the Participant’s estate within 60 days after the Participant’s death.

 

(b)                                 This Agreement is intended to meet the
requirements of the “short-term deferral” exception, the “separation pay”
exception and other exceptions under Code Section 409A and the regulations
promulgated thereunder. Notwithstanding anything in this Plan to the contrary,
if required by Code Section 409A, payments may only be made under this Plan upon
an event and in a manner permitted by Code Section 409A, to the extent
applicable.  For purposes

 

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of Code Section 409A, the right to a series of payments under the Plan shall be
treated as a right to a series of separate payments.  All reimbursements and
in-kind benefits provided under the Plan shall be made or provided in accordance
with the requirements of section 409A of the Code, including, where applicable,
the requirement that (i) any reimbursement is for expenses incurred during the
period of time specified in the Plan, (ii) the amount of expenses eligible for
reimbursement, or in-kind benefits provided, during a calendar year may not
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other calendar year, (iii) the reimbursement of an eligible
expense will be made no later than the last day of the calendar year following
the year in which the expense is incurred, and (iv) the right to reimbursement
or in-kind benefits is not subject to liquidation or exchange for another
benefit.  In no event may a Participant designate the year of payment for any
amounts payable under the Plan.

 

Section 5.04                            Termination of Eligibility for Benefits.

 

(a)                                  All Eligible Employees shall cease to be
eligible to participate in the Plan, and all Severance Benefit payments shall
cease upon the occurrence of the earlier of:

 

(i)                                     Subject to Article VIII, termination or
modification of the Plan; or

 

(ii)                                  Completion of payment to the Participant
of the Severance Benefit for which the Participant is eligible under Article IV.

 

(b)                                 Notwithstanding anything herein to the
contrary, the Company shall have the right to cease all Severance Benefit
payments and to recover payments previously made to the Participant should the
Participant at any time breach the Participant’s undertakings under the terms of
the Plan, the Release the Participant executed to obtain the Severance Benefits
under the Plan or the confidentiality, non-competition, non-solicitation and
non-disparagement provisions of Article VI.

 

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ARTICLE VI

CONFIDENTIALITY, COVENANT NOT TO COMPETE AND NOT TO SOLICIT

 

Section 6.01                            Confidential Information.  The
Participant agrees that he or she shall not, directly or indirectly, use, make
available, sell, disclose or otherwise communicate to any person, other than in
the course of the Participant’s assigned duties and for the benefit of the
Company, either during the period of the Participant’s employment or at any time
thereafter, any nonpublic, proprietary or confidential information, knowledge or
data relating to the Company, any of its Subsidiaries, affiliated companies or
businesses, which shall have been obtained by the Participant during the
Participant’s employment by the Company or a Subsidiary.  The foregoing shall
not apply to information that (i) was known to the public prior to its
disclosure to the Participant; (ii) becomes known to the public subsequent to
disclosure to the Participant through no wrongful act of the Participant or any
representative of the Participant; or (iii) the Participant is required to
disclose by applicable law, regulation or legal process (provided that the
Participant provides the Company with prior notice of the contemplated
disclosure and reasonably cooperates with the Company at its expense in seeking
a protective order or other appropriate protection of such information). 
Notwithstanding clauses (i) and (ii) of the preceding sentence, the
Participant’s obligation to maintain such disclosed information in confidence
shall not terminate where only portions of the information are in the public
domain.

 

Section 6.02                            Non-Competition.  The Participant
acknowledges that he or she performs services of a unique nature for the Company
that are irreplaceable, and that his or her performance of such services for a
competing business will result in irreparable harm to the Company.  Accordingly,
during the Participant’s employment with the Company or Subsidiary and for the
one (1) year period thereafter, the Participant agrees that the Participant will
not, directly or indirectly, own, manage, operate, control, be employed by
(whether as an employee, consultant, independent contractor or otherwise, and
whether or not for compensation) or render services to any person, firm,
corporation or other entity, in whatever form, engaged in any business of the
same type as any business in which the Company or any of its Subsidiaries or
affiliates is engaged on the date of termination or in which they have proposed,
on or prior to such date, to be engaged in on or after such date and in which
the Participant has been involved to any extent (other than de minimis) at any
time during the one (1) year period ending with the date of termination, in any
locale of any country in which the Company or any of its Subsidiaries conducts
business.  This Section 6.02 shall not prevent the Participant from owning not
more than one percent of the total shares of all classes of stock outstanding of
any publicly held entity engaged in such business, nor will it restrict the
Participant from rendering services to charitable organizations, as such term is
defined in section 501(c) of the Code.

 

Section 6.03                            Non-Solicitation.  During the
Participant’s employment with the Company or a Subsidiary and for the two
(2) year period thereafter, the Participant agrees that he or she will not,
directly or indirectly, individually or on behalf of any other person, firm,
corporation or other entity, knowingly solicit, aid or induce (i) any employee
of the Company or any Subsidiary, as defined by the Company, to leave such
employment in order to accept employment with or render services to or with any
other person, firm, corporation or other entity unaffiliated with the Company or
knowingly take any action to materially assist or aid any other person, firm,
corporation or other entity in identifying or hiring any such employee, or
(ii) any customer of the Company or any Subsidiary to purchase goods or services
then sold by the

 

13

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Company or any Subsidiary from another person, firm, corporation or other entity
or assist or aid any other persons or entity in identifying or soliciting any
such customer.

 

Section 6.04                            Non-Disparagement.  Each of the
Participant and the Company (for purposes hereof, the Company shall mean only
the executive officers and directors thereof and not any other employees) agrees
not to make any statements that disparage the other party, or in the case of the
Company or its Subsidiaries, their respective affiliates, employees, officers,
directors, products or services.  Notwithstanding the foregoing, statements made
in the course of sworn testimony in administrative, judicial or arbitral
proceedings (including, without limitation, depositions in connection with such
proceedings) shall not be subject to this Section 6.04.

 

Section 6.05                            Reasonableness.  In the event the
provisions of this Article VI shall ever be deemed to exceed the time, scope or
geographic limitations permitted by applicable laws, then such provisions shall
be reformed to the maximum time, scope or geographic limitations, as the case
may be, permitted by applicable laws.

 

Section 6.06                            Equitable Relief.

 

(a)                                  By participating in the Plan, the
Participant acknowledges that the restrictions contained in this Article VI are
reasonable and necessary to protect the legitimate interests of the Company, its
Subsidiaries and its affiliates, that the Company would not have established
this Plan in the absence of such restrictions, and that any violation of any
provision of this Article VI will result in irreparable injury to the Company. 
By agreeing to participate in the Plan, the Participant represents that his or
her experience and capabilities are such that the restrictions contained in this
Article VI will not prevent the Participant from obtaining employment or
otherwise earning a living at the same general level of economic benefit as is
currently the case.  The Participant further represents and acknowledges that
(i) he or she has been advised by the Company to consult his or her own legal
counsel in respect of this Plan, and (ii) that he or she has had full
opportunity, prior to agreeing to participate in this Plan, to review thoroughly
this Plan with his or her counsel.

 

(b)                                 The Participant agrees that the Company
shall be entitled to preliminary and permanent injunctive relief, without the
necessity of proving actual damages, as well as an equitable accounting of all
earnings, profits and other benefits arising from any violation of this
Article VI, which rights shall be cumulative and in addition to any other rights
or remedies to which the Company may be entitled.  In the event that any of the
provisions of this Article VI should ever be adjudicated to exceed the time,
geographic, service, or other limitations permitted by applicable law in any
jurisdiction, then such provisions shall be deemed reformed in such jurisdiction
to the maximum time, geographic, service, or other limitations permitted by
applicable law.

 

(c)                                  The Participant irrevocably and
unconditionally (i) agrees that any suit, action or other legal proceeding
arising out of this Article VI, including without limitation, any action
commenced by the Company for preliminary and permanent injunctive relief or
other equitable relief, may be brought in the United States District Court for
the District of New York, or if such court does not have jurisdiction or will
not accept jurisdiction, in any court of general jurisdiction in New York,
(ii) consents to the non-exclusive jurisdiction of any such court in any such
suit, action or proceeding, and (iii) waives any objection which Participant may
have to the

 

14

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laying of venue of any such suit, action or proceeding in any such court. 
Participant also irrevocably and unconditionally consents to the service of any
process, pleadings, notices or other papers in a manner permitted by the notice
provisions of Section 11.02.

 

Section 6.07                            Survival of Provisions.  The obligations
contained in this Article VI shall survive the termination of Participant’s
employment with the Company or a Subsidiary and shall be fully enforceable
thereafter.

 

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ARTICLE VII

THE PLAN ADMINISTRATOR

 

Section 7.01         Authority and Duties.  It shall be the duty of the Plan
Administrator, on the basis of information supplied to it by the Company and the
Committee, to properly administer the Plan.  The Plan Administrator shall have
the full power, authority and discretion to construe, interpret and administer
the Plan, to make factual determinations, to correct deficiencies therein, and
to supply omissions.  All decisions, actions and interpretations of the Plan
Administrator shall be final, binding and conclusive upon the parties, subject
only to determinations by the Named Appeals Fiduciary (as defined in
Section 10.04), with respect to denied claims for Severance Benefits.  The Plan
Administrator may adopt such rules and regulations and may make such decisions
as it deems necessary or desirable for the proper administration of the Plan.

 

Section 7.02         Compensation of the Plan Administrator.  The Plan
Administrator shall receive no compensation for services as such.  However, all
reasonable expenses of the Plan Administrator shall be paid or reimbursed by the
Company upon proper documentation.  The Plan Administrator shall be indemnified
by the Company against personal liability for actions taken in good faith in the
discharge of the Plan Administrator’s duties.

 

Section 7.03         Records, Reporting and Disclosure.  The Plan Administrator
shall keep a copy of all records relating to the payment of Severance Benefits
to Participants and former Participants and all other records necessary for the
proper operation of the Plan.  All Plan records shall be made available to the
Committee, the Company and to each Participant for examination during business
hours except that a Participant shall examine only such records as pertain
exclusively to the examining Participant and to the Plan.  The Plan
Administrator shall prepare and shall file as required by law or regulation all
reports, forms, documents and other items required by ERISA, the Code, and every
other relevant statute, each as amended, and all regulations thereunder (except
that the Company, as payor of the Severance Benefits, shall prepare and
distribute to the proper recipients all forms relating to withholding of income
or wage taxes, Social Security taxes, and other amounts that may be similarly
reportable).

 

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ARTICLE VIII

AMENDMENT, TERMINATION AND DURATION

 

Section 8.01         Amendment, Suspension and Termination.  Except as otherwise
provided in this Section 8.01, the Board or its delegate shall have the right,
at any time and from time to time, to amend, suspend or terminate the Plan in
whole or in part, for any reason or without reason, and without either the
consent of or the prior notification to any Participant, by a formal written
action.  No such amendment shall give the Company the right to recover any
amount paid to a Participant prior to the date of such amendment or to cause the
cessation of Severance Benefits already approved for a Participant who has
executed a Release as required under Section 3.02.  Any amendment or termination
of the Plan must comply with all applicable legal requirements including,
without limitation, compliance with Code Section 409A and the regulations and
ruling promulgated thereunder, securities, tax, or other laws, rules,
regulations or regulatory interpretations thereof, applicable to the Plan.

 

Section 8.02         Duration.  Unless terminated sooner by the Board or its
delegate, the Plan shall continue in full force and effect until termination of
the Plan pursuant to Section 8.01; provided, however, that after the termination
of the Plan, if any Participants terminated employment on account of an
Involuntary Termination prior to the termination of the Plan and are still
receiving Severance Benefits under the Plan, the Plan shall remain in effect
until all of the obligations of the Company are satisfied with respect to such
Participants.

 

17

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ARTICLE IX

DUTIES OF THE COMPANY AND THE COMMITTEE

 

Section 9.01         Records.  The Company or a Subsidiary thereof shall supply
to the Committee all records and information necessary to the performance of the
Committee’s duties.

 

Section 9.02         Payment. Payments of Severance Benefits to Participants
shall be made in such amount as determined by the Committee under Article IV,
from the Company’s general assets or from a supplemental unemployment benefits
trust, in accordance with the terms of the Plan, as directed by the Committee.

 

Section 9.03         Discretion.  Any decisions, actions or interpretations to
be made under the Plan by the Board, the Committee and the Plan Administrator,
acting on behalf of either, shall be made in each of their respective sole
discretion, not in any fiduciary capacity and need not be uniformly applied to
similarly situated individuals and such decisions, actions or interpretations
shall be final, binding and conclusive upon all parties.  As a condition of
participating in the Plan, the Eligible Employee acknowledges that all decisions
and determinations of the Board, the Committee and the Plan Administrator shall
be final and binding on the Eligible Employee, his or her beneficiaries and any
other person having or claiming an interest under the Plan on his or her behalf.

 

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ARTICLE X

CLAIMS PROCEDURES

 

Section 10.01       Claim.  Each Participant under this Plan may file a claim
for Severance Benefits hereunder by completing and filing with the Plan
Administrator a written request for review in the manner specified by the Plan
Administrator.  No appeal is permissible as to an Eligible Employee’s
eligibility for or a Participant’s amount of the Severance Benefit, which are
decisions made solely within the discretion of the Company, and the Committee
acting on behalf of the Company.  No person may bring an action for any alleged
wrongful denial of Plan benefits in a court of law unless the claims procedures
described in this Article X are exhausted and a final determination is made by
the Plan Administrator and/or the Named Appeals Fiduciary.  If an Eligible
Employee or Participant or other interested person challenges a decision by the
Plan Administrator and/or Named Appeals Fiduciary, a review by the court of law
will be limited to the facts, evidence and issues presented to the Plan
Administrator during the claims procedure set forth in this Article X.  Facts
and evidence that become known to the terminated Eligible Employee or
Participant or other interested person after having exhausted the claims
procedure must be brought to the attention of the Plan Administrator for
reconsideration of the claims administrator.  Issues not raised with the Plan
Administrator and/or Named Appeals Fiduciary will be deemed waived.

 

Section 10.02       Initial Claim.  Before the date on which payment of a
Severance Benefit commences, each such application must be supported by such
information as the Plan Administrator deems relevant and appropriate.  In the
event that any claim relating to Severance Benefits is denied in whole or in
part, the terminated Participant or his or her beneficiary (“claimant”) whose
claim has been so denied shall be notified of such denial in writing by the Plan
Administrator within ninety (90) days after the receipt of the claim for
benefits.  This period may be extended an additional ninety (90) days if the
Plan Administrator determines such extension is necessary and the Plan
Administrator provides notice of extension to the claimant prior to the end of
the initial ninety (90) day period.  The notice advising of the denial shall
specify the following: (i) the reason or reasons for denial, (ii) the specific
Plan provisions on which the determination was based, (iii) any additional
material or information necessary for the claimant to perfect the claim
(explaining why such material or information is needed), and (iv) the Plan’s
review procedures and the time limits applicable to such procedures, including a
statement of the claimant’s right to bring a civil action under section
502(a) of ERISA following an adverse benefit determination on review.

 

Section 10.03       Appeals of Denied Administrative Claims.  All appeals shall
be made by the following procedure:

 

(a)           A claimant whose claim has been denied shall file with the Plan
Administrator a notice of appeal of the denial.  Such notice shall be filed
within sixty (60) calendar days of notification by the Plan Administrator of the
denial of a claim, shall be made in writing, and shall set forth all of the
facts upon which the appeal is based.  Appeals not timely filed shall be barred.

 

(b)           The Named Appeals Fiduciary shall consider the merits of the
claimant’s written presentations, the merits of any facts or evidence in support
of the denial of benefits, and such other facts and circumstances as the Named
Appeals Fiduciary shall deem relevant.

 

19

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(c)           The Named Appeals Fiduciary shall render a determination upon the
appealed claim which determination shall be accompanied by a written statement
as to the reasons therefor.  The determination shall be made to the claimant
within sixty (60) days of the claimant’s request for review, unless the Names
Appeals Fiduciary determines that special circumstances requires an extension of
time for processing the claim.  In such case, the Named Appeals Fiduciary shall
notify the claimant of the need for an extension of time to render its decision
prior to the end of the initial sixty (60) day period, and the Named Appeals
Fiduciary shall have an additional sixty (60) day period to make its
determination.  The determination so rendered shall be binding upon all
parties.  If the determination is adverse to the claimant, the notice shall
provide (i) the reason or reasons for denial, (ii) the specific Plan provisions
on which the determination was based, (iii) a statement that the claimant is
entitled to receive, upon request and free of charge, reasonable access to, and
copies of, all documents, records and other information relevant to a the
claimant’s claim for benefits, and (iv) a statement that the claimant has the
right to bring an action under section 502(a) of ERISA.

 

Section 10.04       Appointment of the Named Appeals Fiduciary.  The Named
Appeals Fiduciary shall be the person or persons named as such by the Board or
Committee, or, if no such person or persons be named, then the person or persons
named by the Plan Administrator as the Named Appeals Fiduciary.  Named Appeals
Fiduciaries may at any time be removed by the Board or Committee, and any Named
Appeals Fiduciary named by the Plan Administrator may be removed by the Plan
Administrator.  All such removals may be with or without cause and shall be
effective on the date stated in the notice of removal.  The Named Appeals
Fiduciary shall be a “Named Fiduciary” within the meaning of ERISA, and unless
appointed to other fiduciary responsibilities, shall have no authority,
responsibility, or liability with respect to any matter other than the proper
discharge of the functions of the Named Appeals Fiduciary as set forth herein.

 

Section 10.05       Arbitration; Expenses.  In the event of any dispute under
the provisions of this Plan, other than a dispute in which the primary relief
sought is an equitable remedy such as an injunction, the parties shall have the
dispute, controversy or claim settled by arbitration in New York, New York (or
such other location as may be mutually agreed upon by the Employer and the
Participant) in accordance with the National Rules for the Resolution of
Employment Disputes then in effect of the American Arbitration Association,
before a panel of three arbitrators, two of whom shall be selected by the
Company and the Participant, respectively, and the third of whom shall be
selected by the other two arbitrators.  Any award entered by the arbitrators
shall be final, binding and nonappealable and judgment may be entered thereon by
either party in accordance with applicable law in any court of competent
jurisdiction.  This arbitration provision shall be specifically enforceable. 
The arbitrators shall have no authority to modify any provision of this Plan or
to award a remedy for a dispute involving this Plan other than a benefit
specifically provided under or by virtue of the Plan.  If the Participant
substantially prevails on any material issue, which is the subject of such
arbitration or lawsuit, the Company shall be responsible for all of the fees of
the American Arbitration Association and the arbitrators and any expenses
relating to the conduct of the arbitration (including the Company’s and
Participant’s reasonable attorneys’ fees and expenses).  Otherwise, each party
shall be responsible for its own expenses relating to the conduct of the
arbitration (including reasonable attorneys’ fees and expenses) and shall share
the fees of the American Arbitration Association.

 

20

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ARTICLE XI

MISCELLANEOUS

 

Section 11.01       Nonalienation of Benefits.  None of the payments, benefits
or rights of any Participant shall be subject to any claim of any creditor of
any Participant, and, in particular, to the fullest extent permitted by law, all
such payments, benefits and rights shall be free from attachment, garnishment
(if permitted under applicable law), trustee’s process, or any other legal or
equitable process available to any creditor of such Participant.  No Participant
shall have the right to alienate, anticipate, commute, plead, encumber or assign
any of the benefits or payments that he may expect to receive, continently or
otherwise, under this Plan, except for the designation of a beneficiary as set
forth in Section 5.01.

 

Section 11.02       Notices.  All notices and other communications required
hereunder shall be in writing and shall be delivered personally or mailed by
registered or certified mail, return receipt requested, or by overnight express
courier service.  In the case of the Participant, mailed notices shall be
addressed to him or her at the home address which he or she most recently
communicated to the Company in writing.  In the case of the Company, mailed
notices shall be addressed to the Plan Administrator.

 

Section 11.03       Successors.  Any successor to the Company shall assume the
obligations under this Plan and expressly agree to perform the obligations under
this Plan.

 

Section 11.04       Other Payments.  Except as otherwise provided in this Plan,
no Participant shall be entitled to any cash payments or other severance
benefits under any of the Company’s then current severance pay policies for a
termination that is covered by this Plan for the Participant.

 

Section 11.05       No Mitigation.  Except as otherwise provided in
Section 4.01(d) and Section 4.04, Participants shall not be required to mitigate
the amount of any Severance Benefit provided for in this Plan by seeking other
employment or otherwise, nor shall the amount of any Severance Benefit provided
for herein be reduced by any compensation earned by other employment or
otherwise, except if the Participant is re-employed by Company, in which case
Severance Benefits shall cease.

 

Section 11.06       No Contract of Employment.  Neither the establishment of the
Plan, nor any modification thereof, nor the creation of any fund, trust or
account, nor the payment of any benefits shall be construed as giving any
Eligible Employee or any person whosoever, the right to be retained in the
service of the Company, and all Eligible Employees shall remain subject to
discharge to the same extent as if the Plan had never been adopted.

 

Section 11.07       Severability of Provisions.  If any provision of this Plan
shall be held invalid or unenforceable by a court of competent jurisdiction,
such invalidity or unenforceability shall not affect any other provisions
hereof, and this Plan shall be construed and enforced as if such provisions had
not been included.

 

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Section 11.08       Heirs, Assigns, and Personal Representatives.  This Plan
shall be binding upon the heirs, executors, administrators, successors and
assigns of the parties, including each Participant, present and future.

 

Section 11.09       Headings and Captions.  The headings and captions herein are
provided for reference and convenience only, shall not be considered part of the
Plan, and shall not be employed in the construction of the Plan.

 

Section 11.10       Gender and Number.  Where the context admits: words in any
gender shall include any other gender, and, except where otherwise clearly
indicated by context, the singular shall include the plural, and vice-versa.

 

Section 11.11       Unfunded Plan.  The Plan shall not be funded.  No
Participant shall have any right to, or interest in, any assets of the Company
that may be applied by the Company to the payment of Severance Benefits.

 

Section 11.12       Payments to Incompetent Persons.  Any benefit payable to or
for the benefit of a minor, an incompetent person or other person incapable of
receipting therefor shall be deemed paid when paid to such person’s guardian or
to the party providing or reasonably appearing to provide for the care of such
person, and such payment shall fully discharge the Company, the Committee and
all other parties with respect thereto.

 

Section 11.13       Lost Payees.  A benefit shall be deemed forfeited if the
Committee is unable to locate a Participant to whom a Severance Benefit is due. 
Such Severance Benefit shall be reinstated if application is made by the
Participant for the forfeited Severance Benefit while this Plan is in operation.

 

Section 11.14       Controlling Law.  This Plan shall be construed and enforced
according to the laws of the State of New York to the extent not superseded by
Federal law.

 

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SCHEDULE A

 

SEVERANCE BENEFITS

 

Section 16 Officers

 

24 months of annual Base Salary and Annual Bonus

Presidents of businesses whose annual revenue is $2 billion or more

 

18 months of annual Base Salary and Annual Bonus

All other Band 1 and 2 employees

 

12 months of annual Base Salary and Annual Bonus

 

Notwithstanding the foregoing, for Participants whose benefit is provided
pursuant to a supplemental unemployment benefits trust, cash Severance Benefits
shall be paid for the period of time set forth under the plan, with the trust
being the exclusive source of all salary continuation other than Notice Pay.

 

A-1

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