3. Dividends and Dividend Equivalents. Subject to the terms and conditionsestablished by the Board of Directors of Cooper Industries, Ltd. for payment of dividends on CommonShares, upon distribution of the Restricted Stock units following the lapse of applicablerestrictions, the Company shall pay to the Executive in cash an amount equal to the aggregateamount of cash dividends the Executive would have received had the Executive been the owner ofrecord of all such Restricted Stock Units from the date of this Agreement to the date ofdistribution.     4. Restrictions and Limitations. The Executive hereby accepts the Restricted StockAward and agrees to the following restrictions on such Restricted Stock Award.     (a) Forfeiture. Except as provided in (b) below, if the Executive’s active employmentwith the Company terminates for any reason, Restricted Stock Units not yet vested pursuant toParagraph 2 on the effective date of the Executive’s termination shall be forfeited by theExecutive.     (b) Termination Upon Death or Disability. In the event of the Executive’s death orpermanent and total disability as determined under Cooper’s Group Long-Term Disability BenefitPlan, all Restricted Stock Units not yet vested pursuant to Paragraph 2 on the date of Executive’sdeath or disability shall immediately vest and all restrictions on such Units shall terminate. TheCompany shall cause Cooper Industries, Ltd. to issue Common Shares in the Executive’s name for anysuch Restricted Stock Units and such Common Shares shall be issued to the Executive as soon aspracticable after the date of Executive’s separation from service (as defined in Section 409A ofthe Internal Revenue Code) following his death or permanent or total disability.     (c) Limitations on Transferability. The Executive shall not sell, exchange, transfer,pledge, hypothecate or otherwise dispose of the Restricted Stock Units prior to the lapse ofrestrictions in accordance with Paragraph 2 of this Agreement.     5. Tax. Upon the issuance of Common Shares to the Executive for Restricted StockUnits under this Agreement, the Executive shall pay the Company any taxes required to be withheldby reason of the receipt of compensation resulting from the issuance of such Common
 

 
Shares. In lieu thereof, the Company shall have the right to retain, or the Executive may directthe Company to retain, a sufficient number of Common Shares to satisfy the Company’s withholdingobligations, provided the value of the Common Shares used to satisfy the withholding obligationsdoes not exceed the minimum required tax withholding for the transaction. The value of any CommonShares used to satisfy the tax withholding requirement shall be determined by the closing price ofthe Common Shares on the New York Stock Exchange on the date the restrictions lapse (or if sharesare not traded on the Exchange on such date, then on the immediately preceding trading date).     6. Change in Control. In the event of a Change in Control, all remaining restrictionson Restricted Stock Units shall immediately lapse and payment or distribution of the RestrictedStock Units shall be governed by the terms of the Plan.     7. Consideration. The parties agree that the consideration for any issuance of CommonShares for Restricted Stock Units hereunder shall be past services by the Executive having a valuenot less than the par value of such Common Shares.     8. Plan Incorporated. The Executive acknowledges receipt of a copy of the Plan, whichis incorporated by reference into this Agreement. The Executive agrees that this Restricted StockAward shall be subject to all of the terms and provisions of the Plan.     9. Binding Effect. This Agreement shall be binding upon and inure to the benefit ofany successors to the Company and all persons lawfully claiming under the Executive.
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     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officerthereunto duly authorized, and the Executive has executed this Agreement, all as of the date firstabove written.       **COOPER US, INC.**               John W. Sparrow    Vice President, Compensation & Benefits         **EXECUTIVE**              (Name)    (Title)  
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