| 1. | Your                starting base salary will be at an annual rate of $400,000 (four                hundred                thousand U.S. dollars) paid monthly. |
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| 2. | This                position is an “incentive eligible” position, which means you will be                eligible to participate in the Annual Incentive Matrix (AIM) Program.                Your                annual opportunity is targeted at 70% of base salary. The actual                award                that an individual may receive can be higher or lower than the targeted                amount depending upon individual performance and the performance                of the                Company. For performance year 2007 you will be eligible for a full                year                consideration, i.e., unreduced for partial year                employment. |
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| 3. | You                will be recommended for a sign-on award of 30,000 (thirty thousand)                non-qualified stock options. This award is subject to approval by                the                Compensation Committee of the Company’s Board of Directors (the                “Committee”) and to the terms and conditions of awards made under our                Incentive Stock Plan. These options will be priced at the fair market                value of Ingersoll Rand stock on the day the Committee considers                and                approves awards and will vest ratably over three years following                the                grant. Your award recommendation will be considered by the Committee                at                their first meeting following your first day of employment. The next                scheduled meeting of the Committee is February 7, 2007. |
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| Marcia J. Avedon, Ph.D. |  January                8,                2007 |
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| 4. | You                will be recommended to be a participant in the IR Performance Share                Program (PSP) with a target award level of 7,500 performance shares                for                2007 (awarded February, 2008). Awards under the IR Performance Share                Program are both contingent on and variable with achievement of specific                objectives. The objectives are established each year by the Chairman                and                Compensation Committee, and include several financial performance                metrics,                which for 2007 are E.P.S., Available Cash Flow and R.O.I.C. Awards                from                this plan are normally distributed in February following the Compensation                Committee’s approval. In subsequent years, you will be eligible for                additional annual awards of similar value with qualifying criteria                set at                the time of each award. Participation in the PSP includes stock ownership                requirements, which will be described in greater detail upon your                acceptance in the program by the Compensation                Committee. |
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| 5. | Additionally,                you will receive a sign-on award of 7,500 employment shares with                a 3-year                cliff vesting (all shares will vest in February 2010). |
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| 6. | You                will be eligible to participate in the IR Executive Deferred Compensation                Plan (EDCP). The EDCP gives you the opportunity to defer your AIM                award,                PSP award and up to 50% of your base salary on a pretax basis. Information                regarding the EDCP will be sent to you and a representative from                our                vendor, TBG Financial, will contact you to explain this program after                you                begin your employment. |
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| 7. | You                will be eligible to participate in all employee benefit programs                offered                to all Ingersoll Rand salaried employees in accordance with the terms                and                conditions of those programs. The enclosed information summarizes                these                benefits. Please note that your medical, dental and life insurance                coverage with Ingersoll Rand will commence on the first day of the                month                following employment. |
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| 8. | You                will be eligible for four (4) weeks of paid vacation per year, which                exceeds our normal Company policy. Vacation days are earned and accrued                on                a monthly basis each calendar year. |
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| 9. | You                will be provided a company automobile in accordance with our Company                car                policy, which in your case currently provides an executive automobile                with                a purchase value of up to $60,000. A portion of the benefit will                be                imputed to your statement of gross income for tax                purposes. |
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| 10. | You                will be eligible for the Company’s Executive Health Program, a copy of                which is enclosed. |
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| 11. | You                will be recommended for participation in the Elected Officer Supplemental                Program (EOSP). The EOSP is a non-qualified defined benefit pension                plan                that substantially augments IR’s qualified pension plan and, as its name                denotes, is reserved for elected officers of the company. A brief                summary                is enclosed. Under this employment agreement you will earn double                service                credit (not vesting credit) for each of your first five years of                employment with Ingersoll Rand. The EOSP vests at age 55 with 5 years                of                service. |
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| 12. | As                an elected officer, you are eligible for financial and retirement                counseling services through AYCO, a division of Goldman-Sachs. This                service includes investment strategy and tax filing assistance. A                portion                of the cost for these services is imputed to your annual income.                A                representative from AYCO will contact you after your employment                date. |
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| Marcia J. Avedon, Ph.D. |  January                  8,                  2007 |
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| 13. | Also,                as an elected officer, you will be given a Change in Control Agreement                for                Senior Vice Presidents at the 2.5x level (i.e., 2.5x annual salary,                AIM                and PSP), which provides economic security in the form of cash payments                to                the participant and guaranteed coverage under certain benefit plans                in the                event of job loss caused by the sale of all (or a substantial part                of) the                Company. |
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| 14. | During                the term of your employment, you will be eligible for the Company’s                Relocation Program. The timing of the relocation will be at your                discretion. |
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| 15. | In                the unlikely event of your involuntary termination from Ingersoll                Rand                within five (5) years from your date of hire for other than gross                cause,                as consideration for your release of whatever claims might be made,                you                will receive a) a severance payment of eighteen months base salary                if                termination is within five years of your date of hire, and twelve                months                base salary if termination is after such five years, plus b) a payment                equal to your target amount in the Annual Incentive Matrix (AIM)                Program                and c) a pro-rata payment (prorated based on days in the year through                the                termination date over total days within year) of the Performance                Share                (PSP) Program award that is earned as of your termination date, to                be paid                according to plan provisions, up to the target level. In addition,                under                such circumstances, you will have 90 days following your termination                date                within which to exercise your vested                options. |
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| cc: | Rob                Butler Connie                  RoselerGillian                  Scholes |
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| Enclosures: | Benefits                  SummaryExecutive                    Health Program Write-UpElected                    Officer Supplemental Program                    Write-Up |
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| Marcia J. Avedon, Ph.D. |  January                    8,                    2007 |
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**Conditions      of Offer**

|   | 1. | Verification                of information signed and submitted in connection with the Ingersoll                Rand                employment application and authorization for Release of Personal                Data                Records Information. |
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|   | 2. | Passing                the required drug and alcohol screening. All test results will be                handled                in strict confidence. Attached is the substance abuse screen requirements                and release along with the control form and list of                locations. |
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|   | 3. | Providing                proof of identity and employment eligibility pursuant to the Immigration                Reform and Control Act of 1986 within three (3) working days after                the                actual commencement of work. A copy is enclosed with instructions                for                completing the form along with a list of acceptable verification                documents. |
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|   | 4. | Understanding                and agreement that your employment is to be “at will”. This means that you                or the Company, for any reason or no reason, may terminate employment                and                that nothing in this offer is intended to create a fixed or specified                term                of employment. |
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|   | 5. | Understanding,                agreeing and signing and returning the Code of Conduct and Proprietary                Information forms. |
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**CANDIDATE      ACCEPTANCE**

| /s/ Marcia J. Avedon,              Ph.D. | January              11, 2007 |
|------------------------------------------|-------------------------------|
| Marcia              J. Avedon, Ph.D.     | Date                          |

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