**Exhibit 4.1**

 

October 17,2005

 

Mr. Thomas O.Miller

UNOVA, Inc.

6001 36thAvenue West

Everett, WA 98203

 

**Re:  Employment Agreement**

 

Dear Tom:

 

This letteragreement (the “Agreement”) sets forth the terms and conditions on which UNOVA, Inc.(the “Company”) is willing to continue your employment and it supersedes theletter I sent to you on September 21, 2005.  Unless expressly stated otherwise herein,this Agreement supersedes all prior agreements, whether written or oral,between you and the Company concerning the subject matter of thisAgreement.  Capitalized terms nototherwise defined in this Agreement are defined in paragraph 23 herein.

 

If you accept thisAgreement within the time specified in paragraph 22 and if you do not exercisethe revocation right granted to you in paragraph 22, the following terms andconditions will apply.  Upon youracceptance of the Agreement, we will be required to disclose material terms ofthe agreement in an SEC Form 8-K and to file the Agreement as an exhibitto our SEC 10-Q for the 3rd Quarter of 2005.

 

**1.****              Employmentand Term of Employment**

 

On theEffective Date, you will assume the new role of Vice President, CorporateDevelopment for the Company.  In thiscapacity, you will report to me in my role as the Chief Executive Officer ofthe Company and you will perform the functions and duties which I assign toyou.  You will remain in your new roleuntil July 8, 2006 (the “Termination Date”).  On the Termination Date, you will retire fromthe Company pursuant to the terms of this Agreement.

 

**2.****              BaseSalary and Bonus Opportunity**

 

Duringthe period from the Effective Date through the Termination Date, you willreceive a base salary of $350,300 per year, less income tax withholding andother payroll deductions required by law or elected by you.  This base salary will not be increased ordecreased prior to the Termination Date.

 

Inaddition to your base salary, you will be eligible for a bonus under the 2005UNOVA annual incentive compensation plan (the “2005 AICP”) with a target of 80%of your base salary.  Your target bonusfor 2005 will not be increased or decreased prior to January 1, 2006.  Since 2005 bonus awards are subject to theCompany’s achievement of the performance goals set by the CompensationCommittee of the Company’s Board of Directors and all other terms of the 2005AICP, you may or may not receive any bonus for 2005 and, if

 

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anybonus is awarded to you for 2005, the amount of that bonus may be greater orless than your target bonus.  Any bonusawarded to you for 2005 will be subject to income tax withholding and otherpayroll deductions required by law or elected by you.

 

Withthe exception of the 2005 AICP bonus described above, you will not be eligiblefor any bonus under any incentive compensation plan of the Company, itssubsidiaries or affiliates during the period from the Effective Date throughthe Termination Date.

 

**3.****              StandardBenefits**

 

Duringthe period from the Effective Date through the Termination Date, you willcontinue to participate in and receive benefits under the Company’s standardemployee benefit plans and programs for its senior executives, including,without limitation, the Company’s 401(k) plan, pension plan, health, dental,vision, life and AD&D and disability insurance plans, the employee stockpurchase plan and the auto allowance policy.

 

Followingthe Termination Date, you will be notified of your right to elect thecontinuation of certain group health plan coverage in compliance with thefederal law known as “COBRA.”  If youtimely elect COBRA coverage for you and/or your eligible family members, youwill be solely responsible for payment of the related premiums.

 

Weunderstand that you have recently completed an estate planning process withyour personal advisors.  In accordancewith the Company’s estate planning reimbursement policy, the Company willreimburse up to $2,500 of eligible estate planning costs you have incurred.

 

**4.****              StockOptions, Restricted Stock Units and Performance Share Units**

 

Youroutstanding vested UNOVA stock options (“SOs”), restricted UNOVA stock units (“RSUs”)and performance share units (“PSUs”) are summarized in Exhibit A to thisAgreement.  Your rights with respect tothese vested SOs, RSUs and PSUs are set forth in the agreements in which theCompany granted them to you.

 

Youroutstanding unvested SOs, RSUs and PSUs are summarized on Exhibit A tothis Agreement.  Your rights with respectto these unvested SOs, RSUs and PSUs are set forth in the agreements in whichthe Company granted them to you.

 

Duringthe period from the Effective Date through the Termination Date, you will notreceive any new grants of SOs, RSUs, PSUs or any other form of equity incentivecompensation under any incentive plan of the Company, its subsidiaries oraffiliates.

 

**5.****              SpecialRetirement Benefit**

 

Since you will be less than 62 years of agewhen you retire from the Company on the Termination Date, you will not beeligible for the benefits set forth in the Company’s Supplemental ExecutiveRetirement Plan (the “SERP”) or the Company’s Restoration Plan (the “RestorationPlan”).  In view of this, the Companywill provide you with a special

 

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retirement benefit (the “SRB”) equivalent tothe benefits you would have received if, on the Termination Date, you wereeligible for SERP and Restoration Plan benefits and you were retiring from theCompany at age 65.

 

Subject to paragraph 6 of this Agreement, youwill be eligible to receive SRB payments until the end of your life.  If you wish, you can obtain a survivorshipannuity for your spouse, Janice Miller, at a reduced SRB benefit.  You must decide whether to take thesurvivorship annuity and select the level of the survivorship annuity at least forty-five(45) days prior to the Termination Date. SRB payments will cease at the end ofyour life or, if you take the survivorship annuity and your spouse survivesyou, at the end of her life.

 

The SRB will be maintained as a bookkeepingaccount in the books and records of the Company and you will have no presentownership right or interest in the SRB, or in any assets of the Company withrespect to the SRB.  The SRB is and willremain an unfunded and unsecured promise by the Company to make payments in thefuture.  The SRB may not be sold,assigned, pledged or otherwise hypothecated, transferred, or otherwisealienated by you or your spouse.** **Unless expressly permitted by thisAgreement, any attempt to transfer, hypothecate, alienate, garnish, execute orlevy upon the SRB will be null and void. With respect to the SRB, you and your beneficiaries will at all times begeneral unsecured creditors of the Company.

 

The Company’s actuaries have estimated theSRB with and without the survivorship annuity. These estimates are set forth in Exhibit B to this Agreement andare based on the actuarial and other assumptions described in thatexhibit.  The estimates are subject tofinal adjustment following the Termination Date based on the terms of the SERPand Restoration Plan that the SRB is intended to emulate.

 

Subject to paragraph 6 of this Agreement, theSRB will be paid at the times and in the form the SERP and Restoration Planbenefits would have been paid to you if you were eligible to receive SERP andRestoration Plan benefits on the Termination Date.  SRB payments will be subject to requiredincome tax withholding (including, without limitation, any income taxwithholding which may be required by Section 409A of the Internal RevenueCode) and other payroll deductions required by law or elected by you.

 

**6.****                                      Section 409A**

 

Notwithstanding anything to the contrary inthis Agreement, any SRB payments due to you from the Company pursuant toparagraph 5 within the six (6) month period following the TerminationDate will accrue during such 6-month period and will become payable in a lumpsum payment on the business day immediately following the expiration of such 6-monthperiod, provided, however, that such benefits will be paid earlier, at thetimes and on the terms set forth in the applicable provisions ofparagraph 5, if you advise the Company in writing that, after consultingwith your legal and tax advisers, you have determined that such earlier paymentof SRB benefits will not result in the imposition of the tax described in

 

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Section 409A of the Internal RevenueCode of 1986, as amended, (“Section 409A) and the temporary or finalregulations or other guidance promulgated thereunder.

 

You understand and acknowledge thatregulations or other guidance implementing or interpreting Section 409A mayhave not been issued or finalized as of the Effective Date of this Agreementand it may be necessary or appropriate to amend this Agreement to avoid theimposition of the tax described in Section 409A.  If such regulations or guidance are issued orfinalized and it is necessary or appropriate to amend this Agreement, thisAgreement will be amended to the extent necessary to avoid or minimize theimposition of the tax described in Section 409A.

 

The parties agree to cooperate with eachother and to take the steps that are necessary or appropriate to effect such anamendment of the Agreement.  Youacknowledge and agree that, if the tax described in Section 409A is, forany reason whatsoever, imposed with respect to the SRB payments, you will besolely responsible for payment of all such tax, including without limitationthe 20% tax on the SRB.

 

**7.****                                      SecuritiesTrading**

 

Duringthe period from the Effective Date through the Termination Date, you will besubject to the Company’s policy that precludes a non-executive officer fromdirectly or indirectly selling UNOVA securities if such transactions reduce theexecutive’s holdings of UNOVA securities below the threshold established fromtime to time by the Company.

 

If youwish to conduct any trade of any kind in any UNOVA securities or anyderivatives thereof prior to the Termination Date or within sixty (60) daysafter the Termination Date, you will give the Company advance notice of suchtransactions and cooperate with the Company to ensure that such transactionsoccur at a time and in a manner that will not be detrimental to the Company;provided, however, that this notice and cooperation requirement will not applyto any acquisitions of UNOVA securities you make pursuant to the Company’s employeestock purchase program.

 

**8.****                                      Reporting**

 

You acknowledge and agree that informationconcerning the actual or anticipated compensation, other payments and benefitsdue to you under this Agreement must be properly reported by you and by theCompany in accordance with all applicable laws and regulations.  You agree to cooperate with the Company inreporting such information to the appropriate governmental authorities.

 

**9.****                                      Cooperation**

 

Following the Termination Date, you willcooperate with and assist the Company in its prosecution, conduct or defense oflitigation, claims, investigations or governmental audits in

 

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which you have relevant information or may bea witness.  The Company will reimburseyou for the reasonable expenses you incur due to such cooperation andassistance.

 

**10.****                               Noncompetition**

 

Beginning on the Effective Date, you will not(except with the prior written consent of the Company) (a) engage in, beemployed by, perform services for, participate in the ownership, management,control or operation of, or otherwise be connected with, either directly orindirectly, any of the entities identified below or (b) engage in anyother activity that interferes with the economic or business interests or contractualrelationship of the Company or any subsidiary or affiliate of the Company withany of the entities identified below. You agree that the foregoing non-compete provisions will remain ineffect: (i) for your lifetime with respect to Tier I Companies, (ii) forone (1) year after the Termination Date with respect to Tier II Companiesand (iii) for five (5) years after the Termination Date with respectto Tier III Companies (collectively, the “Non-Compete Provisions”).

 

You agree that the Non-Compete Provisions arereasonable in view of the expertise and the knowledge you gained while employedby the Company, its subsidiaries and affiliates (a) with respect toproprietary and confidential financial data, business strategies and businessplans of the Company, its subsidiaries and affiliates and (b) with respectto privileged and confidential information concerning the claims, causes ofaction, defenses, legal strategies and legal plans of the Company, itssubsidiaries and affiliates.  You alsoagree that substantial harm would result to the Company, its subsidiaries andaffiliates if your expertise and knowledge are made available to or used by aTier I Company, Tier II Company or Tier III Company during the applicable termof the Non-Compete Provisions.

 

**11.****                               Nondisparagement**

 

Beginning on the Effective Date andcontinuing through the Term of this Agreement, (i) the Company, itsdirectors, officers and employees will not make any disparaging or derogatoryremarks (whether oral or written) about you and (ii) you will not make anydisparaging or derogatory remarks (whether oral or written) about the Company,its subsidiaries or affiliates or their officers, directors, employees oragents, make any other remark or statement (whether oral or written) or engage anyconduct that is detrimental to the businesses or reputations of those personsor entities.

 

This paragraph 11 is not intended to anddoes not prevent you from making statements when required by law or order of acourt or government agency of competent jurisdiction; provided that, if youreceive legal process requiring such statements, you will promptly notify theCompany and cooperate with the Company in seeking a protective order or takingother appropriate action with respect to such legal process.

 

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**12.****                               Nonsolicitation**

 

You agree that, for the two (2) yearperiod following the Termination Date, you will not (a) directly orindirectly solicit or entice any employee of the Company, its subsidiaries oraffiliates to terminate or reduce his or her employment relationship with theCompany, its subsidiaries or affiliates, or (b) hire as an employee,independent contractor or otherwise, on your own behalf or on behalf of anotherperson or entity, any employee of the Company, its subsidiaries or affiliates.

 

**13.****                               GeneralRelease of Existing Claims**

 

You(on your own behalf and on behalf of your successors, heirs, beneficiaries and permitted assigns) fully, finallyand forever expressly waive, release and discharge the Company, itssubsidiaries and affiliates and their officers, directors, employees and agentsof and from any and all claims, causes of action, claims for damages and claimsfor relief of any kind or nature, whether known or unknown, asserted or unasserted,that you may have on or prior to the Effective Date which are connected in anyway whatsoever with your employment with the Company, its subsidiaries oraffiliates (“Existing Claims”).

 

Youunderstand and agree that the foregoing release includes, but is not limitedto, any and all Existing Claims with respect to wages, bonuses, equitycompensation, or any other form of incentive compensation, or employmentbenefits arising out of any oral or written contract or agreement (whetherexpress or implied by operation of law or otherwise), any covenant of goodfaith and fair dealing (whether express or implied by operation of law orotherwise), any theory of wrongful discharge, any common law or statutory legalrestriction on the Company’s or its subsidiaries’ or affiliates’ right tochange or terminate employment, any federal, state or other governmentalstatute or ordinance or other legal limitation on the employment relationship,including without limitation, Title VII of the Civil Rights Act of 1964, the federalAge Discrimination in Employment Act, the federal American with DisabilitiesAct, the federal Family and Medical Leave Act, the federal Employee RetirementIncome Security Act of 1974, the Washington State Law Against Discrimination,equivalent laws or regulations of any state within the United States andequivalent laws or regulations of any national or regional government or agencyoutside of the United States.

 

Youalso understand and agree that the foregoing release shall operate as a complete and total bar anddefense to any Existing Claimthat has or in the future may, directly or indirectly, be brought by youor your successors, heirs, or beneficiaries against the Company, its subsidiaries or its affiliates.

 

You represent and warrant that you have notdirectly or indirectly filed any complaints, charges or lawsuits against theCompany, its subsidiaries or affiliates with any governmental agency or anycourt within or outside of the United States, and you agree that you will notinitiate or encourage any such actions. You also represent and warrant that you have not assigned any ExistingClaim to any third party, and that no third party has any ownership interest orany lien of any kind or nature with respect to any Existing Claim.

 

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**14.****                               GeneralRelease of Additional Claims**

 

Followingthe Termination Date, you will have twenty-one (21) calendar days to review(with your legal counsel if you wish), sign and return to me the GeneralRelease of Additional Claims attached as Exhibit C to this Agreement.  If you sign that General Release and returnit to me within such 21-day period, you will have an additional seven (7) calendardays from the date you executed that General Release to revoke it.  If you do not revoke that General Releasewithin such 7-day period, it will become binding and enforceable on the dayafter that revocation period expires.

 

**15.****                               CompanyDisclosures Relating To This Agreement**

 

As youknow, the Company is a publicly-traded company and may be required by law topublicly disclose the signing of this Agreement and some or all of itsterms.  You agree that the Company maymake such disclosures to the extent that the Company, in its sole discretion,deems necessary or appropriate to comply with the laws and regulations withinor outside of the United States that apply to publicly-traded companies.

 

**16.****                               OtherDisclosures Relating To This Agreement**

 

Duringthe Term of this Agreement, you will not make any statements, whether oral orwritten, to any person or entity concerning this Agreement without the Company’sprior written consent.

 

This paragraph 16 is not intended to anddoes not prevent you from making truthful statements when required by law ororder of a court or government agency of competent jurisdiction; provided that,if you receive legal process requiring such statements, you will promptlynotify the Company and cooperate with the Company in seeking a protective orderor taking other appropriate action with respect to such legal process.

 

**17.****                               Confidentialityand Non-Use**

 

You acknowledge and agree that informationnot generally known to the public that relates to the business, technology,customers, prospects, employees, finances, legal activities, plans, proposals,policies or practices of the Company, its subsidiaries or affiliates or of anythird Parties doing business with the Company is confidential information (“ConfidentialInformation”) and the sole property of the Company, its subsidiaries andaffiliates.  You further acknowledge andagree that Confidential Information includes, but is not limited to, the tradesecrets, strategic plans, business plans, legal strategies, legal plans,software programs, financial data, customer lists, identities of customers andprospects, marketing plans, nonpublic financial information, any otherinformation about the Company, its subsidiaries or affiliates which theydesignate as “confidential” and all other information about the Company, itssubsidiaries and affiliates that is not generally known to the public.  Confidential Information does not include (a) informationthat is or becomes generally

 

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known to the public through no fault of yourown or (b) information received by you from a third party without a dutyof confidentiality.

 

During the period beginning on the EffectiveDate and continuing through the Termination Date, you will not copy or in anyway use any Confidential Information for any purpose other than the dischargeof your duties as an employee of the Company and you will not disclose anyConfidential Information to any Person other than the officers, directors,employees and agents of the Company, its subsidiaries or affiliates without theCompany’s prior consent except as required by law; provided that, if youreceive legal process with regard to disclosure of any ConfidentialInformation, you will promptly notify the Company and cooperate with theCompany in seeking a protective order or taking other appropriate action withrespect to such legal process.

 

Following the Termination Date and continuingfor the remaining Term of this Agreement, you will not disclose to any thirdparty, or copy or in any way use any Confidential Information without theCompany’s prior written consent, except as required by law; provided that, ifyou receive legal process with regard to disclosure of any ConfidentialInformation, you will promptly notify the Company and cooperate with theCompany in seeking a protective order or taking other appropriate action withrespect to such legal process.

 

You agree that, when your employment with theCompany terminates, regardless of the reasons therefor, you will deliver to theCompany, and not keep or deliver to anyone else, any and all notes, files, memoranda,papers, electronic files and, in general, any and all physical materialcontaining Confidential Information, including without limitation, any and allphysical materials relating to the conduct of business of the Company or anysubsidiary or affiliate of the Company which are in your possession, except for(a) any documents for which the Company or any subsidiary or affiliate ofthe Company has given written consent to removal at the time of the terminationof your employment with the Company; and (b) your personal rolodex, phonebook and similar items.  You furtheragree that following the termination of your employment with the Company, youwill not use any computer access code or password belonging to the Company andthat you will not access any computer or database in the possession, custody orcontrol of the Company.

 

**18.****                               EarlyTermination of Employment and/or SRB Payments**

 

(a) Notwithstandingany other provision of this Agreement, the Company has the right (but not theobligation) to immediately terminate your employment with the Company andwithhold any SRB payments due to you in the future under any of the followingcircumstances:

 

(i) TheCompany determines, in its sole discretion, that you have directly orindirectly materially breached paragraphs 7, 8, 9, 10, 11, 12, 16 or 17 of thisAgreement or that you are going to materially breach one or more of thoseparagraphs.

 

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(ii) TheCompany determines, in its sole discretion, that the representations made byyou in paragraph 13 of this Agreement were false as of the Effective Date.

 

(iii) TheCompany determines, in its sole discretion, that, during your employment withthe Company, its subsidiaries or affiliates (whether such employment occurredbefore or after the Effective Date), you have directly or indirectly engaged inor that you are directly or indirectly engaging in conduct that constitutes abreach of fiduciary duty, actual or constructive fraud, gross negligence orwillful misconduct which has or could cause economic harm to or damage thereputation of the Company, its subsidiaries or affiliates.

 

(iv) Youare convicted (including without limitation a plea of guilty or nolocontendere) of a felony involving actual or constructive fraud, theft, or moralturpitude while you were employed by the Company, its subsidiaries oraffiliates (whether such misconduct occurred before or after the Effective Date).

 

(b)         Notwithstanding any other provision of thisAgreement, the Company has the right (but not the obligation) to withhold anySRB payments due to you in the future if you choose not to sign and return tothe Company the General Release of Additional Claims described in paragraph 14of this Agreement and paragraph 2 of Exhibit C within the 21-day periodspecified in those paragraphs or if you exercise your right to revoke thatGeneral Release within the 7-day revocation period specified in paragraph 14 ofthis Agreement and paragraph 2 of Exhibit C.

 

(c)          If the Company chooses to exercise its rightsunder paragraphs 18(a) or 18(b) of this Agreement, the otherprovisions of this Agreement will remain in full force and effect during yourlifetime.

 

(d)         The rights and remedies set forth in paragraphs18(a), 18(b) and 18(c) are in addition to, and not in lieu of, anyother right or remedy afforded the Company under any other provision of thisAgreement or at law, in equity or otherwise.

 

(e)          If the Company fails to make SRB payments as andwhen required by this Agreement and fails to cure such defaults within 30 daysafter receiving a notice of default from you, you will be released from theNon-Compete Provisions.  This remedy isin addition to, and not in lieu of, any other right or remedy afforded to youunder any other provision of this Agreement or at law, in equity or otherwise.

 

**19.**                               Enforcementof This Agreement

** **

**You agree that if you materiallybreach paragraphs 7, 8, 9, 10, 11, 12, 16 or 17 of this Agreement, the Company,its subsidiaries and its affiliates will sustain immediate and irreparable injury.  In the event of such a breach, the Companymay file any claim for breach of or to enforce this Agreement in any court oflaw or tribunal of competent jurisdiction whether within or outside of theUnited States.**

 

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**Upon receiving actual notice of theCompany’s action by the method for notice set forth in paragraph 20 of thisAgreement, you will waive and you will direct your attorneys to waive any andall challenges to jurisdiction, venue, service of process and, if the court ortribunal finds likelihood of success on the merits, you will agree and you willdirect your attorneys to agree to the entry of a temporary restraining order, apreliminary injunction and a permanent injunction requiring full performance ofthis Agreement.**

** **

**In addition, if the court ortribunal finds likelihood of success on the merits, the Company shall have theright, but not the obligation, to terminate this Agreement and shall beentitled to actual damages according to proof and reimbursement of the fullreasonable attorneys’ fees and costs it incurred in bringing such action.**

** **

**20.**                               Notices

** **

**Any and all notices, demands, orother communications required or desired to be given hereunder by any Partyshall be in writing and shall be validly given or made to another Party ifpersonally served or if deposited in the United States mail, certified orregistered, postage prepaid, return receipt requested or deposited with anestablished overnight delivery service for delivery the next business day.  If such notice or demand is servedpersonally, notice shall be deemed constructively made at the time of suchpersonal service.  If such notice, demandor other communication is given by mail, such notice shall be conclusivelydeemed given five days after deposit thereof in the United States mail,certified or registered mail, postage prepaid, return receipt requested,addressed to the Party to whom such notice, demand or other communication is tobe given as follows:**

** **

**If to Company:**

** **

**Larry D. Brady**

**Chief Executive Officer**

**UNOVA, Inc.**

**6001 36th Avenue West**

**Everett, WA 98203**

** **

**With a copy to:**

** **

**Janis L. Harwell**

**Senior Vice President and GeneralCounsel**

**UNOVA, Inc.**

**6001 36th Avenue West,**

**Everett, WA 98203-1264**

** **

**If to Thomas O. Miller:**

 

 

 

 

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**With a copy to:**

** **

** **

** **

Any Party heretomay change its address for purposes of this paragraph 20 by written noticegiven in the manner provided above.

 

**21.****                               Miscellaneous**

 

(a)   **Entire Agreement. **The Parties agree that this Agreementcontains the entire agreement and understanding of the Parties with respect tothe subject matter hereof and that there are no promises or terms of theagreement between the Parties other than those expressly written in thisAgreement.

 

(b) **Binding Effect. **This Agreement shall be binding Partiesand their respective successors, heirs, beneficiaries, permitted assigns,subsidiaries and affiliates.

 

(c) **Assignment. **No party may assign or otherwise transfer(by operation of law or otherwise) this Agreement without the prior writtenconsent of the other party.

 

(d) **Third Party Beneficiaries**.** **This Agreement isonly for the benefit of, and is only enforceable, by (i) you and your spouse,Janice Miller, and (ii) the Company, its subsidiaries and affiliates andtheir officers, directors, employees, agents, successors and assigns.  The Agreement is not intended to and shallnot be construed to confer any right or benefit on any third party other thanthose identified in the preceding sentence of this paragraph 21(c).

 

(e) **Severability. **If any provision or term of thisAgreement is determined by a court of law or government tribunal to beunenforceable, then such unenforceable provision or term will be modified so asto make it enforceable, or if that is not possible, then it will be deletedfrom this Agreement, and the remaining part of the Agreement shall remain infull, force and effect, provided that the Company shall have the right (but notthe obligation) to immediately terminate your employment with the Company,recapture any SRB payments made to you prior to such termination and withholdany SRB payments due to you in the future in the event that one or more ofparagraphs 7, 9, 10, 11, 12, 13, 14, 16, 17, 18, 21(c) or 21(d) aredeclared by a court or government tribunal of competent jurisdiction to beunenforceable.

 

(f) **Amendments, Waivers andModification. **Noamendment, waiver or modification of this Agreement will be enforceable unlessit is in writing, signed by authorized representatives of each of the Parties.

 

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(g) **Controlling Law.**  This Agreement will be interpreted, construedand enforced in all respects in accordance with the laws of the State ofWashington, without reference to its choice of law or conflict of lawsprinciples.

 

(h) **No Admission.**  Nothing in this Agreement shall be construedas an admission by the Company or any of its subsidiaries or affiliates withrespect to any Existing Claim or any other claim, cause of action, claim fordamages or other relief or otherwise that you may have as of or prior to theEffective Date.

 

(i) **Name Change. **As you know, the Company is planning tochange its name from UNOVA, Inc. to Intermec, Inc.  You agree that, if that change is made on orprior to the Termination Date, the General Release of Additional Claimsattached hereto as Exhibit C can be revised to reflect the fact that theCompany’s name has been changed to Intermec, Inc.

 

(i) **Headings. **The headings to the various sections ofthis Agreement have been inserted for the convenience of the Parties only.  They shall not be used to interpret orconstrue the meaning of the terms and provisions hereof.

 

(j) **Counterparts.**  This Agreement may be signed in counterpartsand, subject to paragraph 22, when each party has signed a counterpart, theAgreement shall be final and binding upon the Parties.

 

**22.  Reviewand Revocation Periods**

 

Youhave until October 24, 2005 to review (with your legal counsel if youwish), sign and return this Agreement to me. If you sign the Agreement and return it to me within that period, youwill have an additional seven (7) calendar days from the date you executedthe Agreement to revoke it.  If you donot revoke the Agreement within such 7-day period, it will become binding andenforceable on the day after that revocation period expires.

 

**23.  AdditionalDefinitions**

 

Forpurposes of this Agreement, the following definitions apply:

 

(a)          “**AIDC Industry**” means companies that sell, offer to sell,lease or offer to lease in any geographic market (i) products that print, captureor collect data via automatic means (including but not limited to barcode,printing, scanning or imaging, radio frequency identification (“RFID”), smartcards, optical character recognition (“OCR”) or magnetic strips) andsubsequently store such data on a microprocessor-controlled device (includingbut not limited to a computer) or (ii) RFID chips, RFID inserts or inlays,RFID tags, RFID printers or RFID readers or terminals.

 

(b)         “**Control**” means beneficial ownership (within the meaning of Rule 13d-3promulgated under the Securities Exchange Act of 1934), directly or indirectlyof fifty percent (50%) or more of the direct or indirect combined voting powerof a 

 

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Person’s then outstanding voting equitygenerally entitled to vote in the election of directors (or other participantsof the managing authority), or (ii) acquiring actual control of theoperations of a Person, whether by means of contract or otherwise; (ii) acquiringcontrol through a merger or consolidation involving Person if the equityholders**of that Person immediately before suchmerger or consolidation, as a result of and after such merger or consolidation,own, directly or indirectly, less than fifty percent (50%) of the combinedvoting power of the then outstanding voting securities generally entitled tovote in the election of directors (or other participants in the managingauthority) of the entity surviving or resulting from such merger orconsolidation; or (iii) acquiring control of a Person through the purchaseor other acquisition of all or substantially all of the assets of that Person.

 

(c)          “**Effective Date**” means September 10, 2005, the effectivedate of this Agreement.

 

(d)         “**Person**” means an individual, a corporation, a limitedliability company, a partnership, an association, a trust or any other entityor organization, including a government or political subdivision or any agencyor instrumentality thereof, whether for profit or not-for-profit.

 

(d)         “**Term**” means the period beginning on the Effective Datethrough the date on which the last SRB payment you pursuant to paragraph 5 ofthis Agreement.

 

(c)          “**Tier I Companies**” means Symbol Technologies, Inc.,  Zebra Technologies Corp., Handheld Products, Inc.,Impinj, Inc., Applied Wireless Identifications, Inc., AlienTechnology Corporation, Motorola, Inc. and their subsidiaries, affiliatesand successors thereof (including any Person that obtains Control of any suchTier I Company).

 

(d)         “**Tier II Companies**” means value-added resellers that havebeen designated as Honours Partners by Intermec Technologies Corporation (“Intermec”).

 

(e)          “**Tier III Companies**” means (i) any Person that competesin the AIDC Industry (other than the Tier I Companies and Tier II Companies)and (ii) any Person that sets standards for hardware, software orprotocols made, used, sold, offered for sale, leased or offered for lease inthe AIDC Industry.

 

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Tom, we continue to value your association with the Company.  If you agree with the terms and conditionsset forth above, please fill in the notice information required in paragraph20, sign the Agreement in the space provided below and return the signedoriginal to me for our files.  Pleasemaintain a copy for your own records.

 

Sincerely,

 
| /s/ Larry D. Brady      |   |
|-------------------------|--------|
| Larry D. Brady          |
| Chairman and            |
| Chief Executive Officer |

 

I accept the terms and conditions described in this Agreement, which Ihave read and understand.

 

 
| /s/ Thomas  O. Miller |   | October 21,  2005 |   |
|-----------------------|--------|------------------------|--------|
| Thomas O.  Miller     |   | Date                   |   |

 

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