**Exhibit      10.40**

| 1.   | Your                starting base salary will be at an annual rate of $375,000 (three                hundred,                seventy-five thousand U.S. dollars) paid monthly. |
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| 2.   | Additionally,                you will receive a sign-on cash award of up to $210,000 (the final                amount                will be based on what you owe Schindler as a result of your resignation),                which will be paid as soon as administratively practical following                your                start date. |
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| 3.   | You                will be eligible to participate in the Annual Incentive Matrix (AIM)                Program. Your annual opportunity is targeted at 80% of base salary                depending upon your performance and the performance of Ingersoll-Rand                Company Limited. For performance year 2005 your annual incentive                opportunity will be pro-rated, unless, as a result of your termination                from Schindler, you lose your award. If you do lose the Schindler                award,                your IR annual incentive opportunity will be based on a full year                of                service, up to the target value of                $300,000. |
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| 4.   | You                will be recommended for a sign-on award of 20,000 (twenty thousand)                (post-split) non-qualified stock options. This award is subject to                approval by the Compensation Committee of the Ingersoll Rand Company                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. Your award recommendation will be                considered by the Committee at their first meeting following your                first                day of employment. |
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|  James              Bolch |  2 |  August                22, 2005 |
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| 5.   | You                will be recommended as a participant in the IR Performance Share                Program                (PSP) for a target award of 7,000 (post-split) performance shares                for                performance year 2006 (payable February 2007). 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 Board of Directors, and include several                strategic                objectives aimed at improving organizational effectiveness and several                financial performance metrics, which for 2006 are E.P.S., Free Cash                Flow                and R.O.I.C. Awards from this plan are distributed as cash (unless                deferred) in February following the Board’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. |
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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. In                addition, as a selected IR leader, you will also be eligible to receive                a                20% company match on AIM and PSP deferrals invested in IR stock                equivalents. Information regarding the EDCP will be sent to you and                a                representative from our vendor, TBG Financial, will contact you to                explain                this program. |
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| 7.   | Additionally,                you will be recommended for a sign-on award of 7,000 (seven thousand)                (post-split) IR employment shares to be contributed to the Company’s                Executive Deferred Compensation Plan (EDCP) and invested in IR stock                equivalents, with vesting in 2009. The value will fluctuate with                the value                of IR’s share price and dividends. |
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| 8.   | You                will be eligible for the complete program of employee benefits offered                to                all Ingersoll-Rand salaried employees in accordance with the terms                and                conditions of those plans. Please note that your medical and life                insurance coverage with Ingersoll-Rand will commence on the first                day of                the month following employment. A summary of Ingersoll-Rand’s key benefits                is enclosed. |
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| 9.   | You                will be entitled to four (4) weeks of paid vacation per year, which                exceeds our normal company policy. |
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| 10.   | You                will be provided a company automobile in accordance with our company                car                policy, which in your case 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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| 11.   | You                will be eligible for the Company’s Executive Health Program, a copy of                which is enclosed. |
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| 12.   | This                position is eligible 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. |
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| 13.   | 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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|  James                Bolch |  3 |  August                  22, 2005 |
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| 14.   | Also,                as an elected officer, you will be given a standard Change of Control                Agreement, 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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| 15.   | You                will be eligible for the Company’s Relocation Program. The timing of the                relocation will be at your discretion. A representative from Cendant                Mobility will be in touch with you to explain the program and to                discuss                the timing of your relocation. |
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| 16.   | In                the unlikely event of your involuntary termination from Ingersoll-Rand                within the two 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 severance of one year’s base salary plus whatever pro-rata Annual                Incentive Matrix (AIM) and Performance Share (PSP) award is earned                as of                your termination date, to be paid according to plan provisions. You                will                also have 90 days following your termination date within which to                exercise                your vested options. |
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| 17.   | This                offer is conditional upon satisfactorily passing a drug test, finalization                of our reference checking and fulfilling the requirements of the                Immigration Reform and Control Act of 1986. |
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| Attachments: | Elected                Officer Supplemental (Pension)                Program |
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|  /s/              James R. Bolch |   |  August              25, 2005 |
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|  James R. Bolch                  |   |  Date                         |

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