**Exhibit 10.9**

**SEVERANCE AGREEMENT**

This Severance Agreement(the “***Agreement***”) isentered into this          day of                         ,2006 (the “***Effective Date***”), betweenVerigy Ltd., a Singapore corporation (the “***Company***”), and                               (“***Executive***”), who currently serves as[title] of the Company.

**RECITALS**

**A.****           **As is the casewith most, if not all, publicly traded businesses, it is expected that theCompany from time to time may consider or may be presented with the need toconsider the possibility of an acquisition by another company or other changein control of the ownership of the Company. The Board of Directors of the Company (the “***Board***”)recognizes that such considerations can be a distraction to Executive and cancause Executive to consider alternative employment opportunities or to beinfluenced by the impact of a possible change in control of the ownership ofthe Company on Executive’s personal circumstances in evaluating suchpossibilities.  The Board has determinedthat it is in the best interests of the Company and its shareholders to ensurethat the Company will have the continued dedication and objectivity ofExecutive, notwithstanding the possibility, threat or occurrence of a Change ofControl of the Company.

**B.**            The Board believesthat it is in the best interests of the Company and its shareholders to provideExecutive with an incentive to continue his/her employment and to motivateExecutive to maximize the value of the Company for the benefit of itsshareholders.

**C.**            The Board believesthat it is important to provide Executive with certain benefits upon Executive’stermination of employment in certain instances that provide Executive withenhanced financial security and incentive and encouragement to Executive to remainwith the Company.

**D.**            At the same time, theBoard expects the Company to receive certain benefits in exchange for providingExecutive with this measure of financial security and incentive under theAgreement.  Therefore, the Board believesthat Executive should provide various specific commitments, which are intendedto assure the Company that Executive will not direct Executive’s skills,experience and knowledge to the detriment of the Company for a period not toexceed the period during which payments are being made to Executive under thisAgreement.

**E.****            **Certaincapitalized terms used in this Agreement are defined in Article VIII.

The Company and Executivehereby agree as follows:

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# **ARTICLE I**

# **EMPLOYMENT BY THE COMPANY**

## **1.1****         **This Agreement shall be in effectcommencing on the Effective Date and ending on the later of (i) the datewhen Executive ceases to be employed by the Company for any reason or(ii) the date when all obligations of the parties under this Agreementhave been met.

## **1.2****         **The Company and Executive eachagree and acknowledge that Executive is employed by the Company as an “at-will”employee and that either Executive or the Company has the right at any time toterminate Executive’s employment with the Company, with or without cause oradvance notice, for any reason or for no reason.  ThisAgreement does not constitute a contract of employment or impose on Executiveany obligation to remain as an employee or impose on the Company any obligation(i) to retain Executive as an employee, (ii) to change the status ofExecutive as an at-will employee or (iii) to change the Company’s policiesregarding termination of employment.  Inthis Agreement, the Company and Executive wish to set forth the compensationand benefits that Executive shall be entitled to receive in the event thatExecutive’s employment with the Company terminates under the circumstancesdescribed in Article II or III.

## **1.3****         **The duties and obligations of theCompany to Executive under this Agreement shall be in consideration forExecutive’s past services to the Company, Executive’s continued employment withthe Company, Executive’s compliance with the obligations described inSection 5.4, and Executive’s execution of the general waiver and releasedescribed in Section 5.5.  TheCompany and Executive agree that Executive’s compliance with the obligationsdescribed in Section 5.4 and Executive’s execution of the general waiverand release described in Section 5.5 are preconditions to Executive’sentitlement to the receipt of benefits under this Agreement and that thesebenefits shall not be earned unless all such conditions have been satisfiedthrough the scheduled date of payment. The Company hereby declares that it has relied upon Executive’scommitments under this Agreement to comply with the requirements ofArticle V and would not have been induced to enter into this Agreement orto execute this Agreement in the absence of such commitments.

# **ARTICLE II**

# **TERMINATION BEFORE CHANGE IN CONTROL**

## **2.1****         ****Terminationwithout Cause**.  In the event (i) Executive’s employment withthe Company and its subsidiaries is involuntarily terminated at any time by theCompany without Cause or (ii) Executive voluntarily terminates his/heremployment within three months of the occurrence of an event constituting GoodReason and on account of an event constituting Good Reason and, in each case,Article III does not apply, then such termination of employment will be aTermination Event and the Company shall pay Executive the compensation andbenefits described in this Article II, subject to Executive complying withhis/her obligations described in Sections 5.4 and 5.5 of this Agreement.

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## **2.2****         ****Disability**. In the event Executive’s employment with the Company and itssubsidiaries terminates as a result of his/her Disability, then Executive shallbe entitled to the pro rated final period bonus described in Section 2.5, thestock award acceleration described in Section 2.6 and the Company-paidhealth insurance coverage described in Section 2.7 (but none of the othercompensation and benefits described in this Article II).

## **2.3****         ****Death**. In the event Executive’s employment with the Company and itssubsidiaries terminates as a result of his/her death, then Executive’ssurvivors shall be entitled to the pro rated final period bonus described inSection 2.5 and the stock award acceleration described in Section 2.6 (butnone of the other compensation and benefits described in this Article II).

## **2.4****         ****Salary Continuation uponTermination before Change in Control**.  If a Termination Eventdescribed in Section 2.1 occurs, Executive shall receive an amount equalto the sum of Executive’s Base Salary and Target Bonus, less any applicablewithholding of federal, state, local or foreign taxes.  Such salary and bonus continuation shall bepaid in accordance with the Company’s standard payroll procedures in equalinstallments over the 12 month period following the date of the TerminationEvent.

## **2.5****         ****Bonus for Final Period**.  If a Termination Event described in Section 2.1 occurs,Executive shall receive a pro rated bonus for the performance period in whichthe Termination Event occurs (in addition to the amount described inSection 2.4).  The amount of thebonus shall be equal to the Target Bonus for the period in which theTermination Event occurred multiplied by a fraction in which (i) thenumerator is the number of days from and including the first day of theperformance period until and including the date of the Termination Event and(ii) the denominator is the number of days in the performance period.  Such bonus shall be paid on the dateExecutive would have received the bonus if the Termination Event had notoccurred during such performance period. Executive’s rights to the payment provided in this Section 2.5shall not be subject to Section 5.4.

## **2.6****         ****Stock Award Acceleration uponTermination before Change in Control**.

### (a)           The vested portion of Executive’sstock options and stock appreciation rights (the “**Stock Options**”) that are outstanding as of the date of anevent described in Section 2.1, 2.2 or 2.3 shall be determined asfollows upon the occurrence of such event:

##### (i)            A period equal to 12 months shallbe added to the actual length of Executive’s service; and

##### (ii)           If the vested portion of the StockOptions otherwise would be determined in increments larger than one month, thenthe vesting of the Stock Options shall be prorated on the basis of the fullmonths of service completed by Executive since the vesting commencement date ofthe Stock Options.(1)

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(1) For example, assume that Executive’s Stock Options ordinarilyvest in four equal annual installments and that Executive is subject to anevent described in Section 2.1, 2.2 or 2.3 after completing 18 months ofservice from the vesting commencement date. Executive would be vested in 18/48ths of the Stock Options for theactual period of service plus 12/48ths of the Stock Options for the addedvesting provided herein, for a total of 30/48ths vested.

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### (b)           The Stock Options shall remainexercisable until the fifteen month anniversary of the date of the TerminationEvent provided that Executive complies with his/her obligations under Article Vof this Agreement. The term “**Stock Options**”shall not include any rights of Executive under the Company’s 2006 EmployeeShares Purchase Plan or similar plans.

### (c)           The vested portion of Executive’srestricted stock awards (“**Restricted Stock**”)that are outstanding as of the date of an event described in Section 2.1,2.2 or 2.3 shall be determined as follows upon the occurrence of suchevent:

##### (i)            A period equal to 12 months shallbe added to the actual length of Executive’s service; and

##### (ii)           If the vested portion of theRestricted Stock otherwise would be determined in increments larger than onemonth, then the vesting of the Restricted Stock shall be prorated on the basisof the full months of service completed by Executive since the vestingcommencement date of the Restricted Stock.

All shares of Restricted Stock that have not yet been delivered toExecutive or his/her designee (whether because subject to joint escrow instructionsor otherwise) shall be promptly delivered to Executive or his/her designee uponthe occurrence of an event described in Section 2.1, 2.2 or 2.3.

### (d)           The vested portion of Executive’sstock unit awards (the “**Stock Units**”)that are outstanding as of the date of an event described in Section 2.1,2.2 or 2.3 shall be determined as follows upon the occurrence of suchevent:

##### (i)            A period equal to 12 months shallbe added to the actual length of Executive’s service; and

##### (ii)           If the vested portion of the StockUnits otherwise would be determined in increments larger than one month, thenthe vesting of the Stock Units shall be prorated on the basis of the fullmonths of service completed by Executive since the vesting commencement date ofthe Stock Units.

All Stock Units that have not yet been settled shall be promptlysettled, in the form specified in the relevant Stock Unit agreements andrelevant stock plans under which the Stock Units were granted, upon theoccurrence of an event described in Section 2.1, 2.2 or 2.3.

## **2.7****         ****Health & Welfare BenefitsCoverage**.

### (a)           Following the occurrence of a Termination Event described inSection 2.1, to the extent permitted by the Consolidated Omnibus BudgetReconciliation Act of 1985 (“**COBRA**”)and by the Company’s group health insurance policies, Executive and his/hercovered dependents will be eligible to continue their health insurance benefitsat their own

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### expense.  If Executive elects COBRA continuation, theCompany shall pay Executive’s and his/her covered dependents’ COBRAcontinuation premiums for 12 months following the date of such TerminationEvent, provided that the Company’s obligation to make such payments shall ceaseimmediately to the extent that Executive and/or Executive’s covered dependentsare no longer entitled to receive COBRA continuation coverage.  Executive agrees to notify a duly authorizedofficer of the Company, in writing, immediately upon Executive’s or a covereddependent’s beginning to receive health benefits from another source, or asotherwise required by COBRA.  ThisSection 2.7(a) provides only for the Company’s payment of COBRAcontinuation premiums for the periods specified above, and does not affect therights of Executive or Executive’s covered dependents under any applicable lawwith respect to health insurance continuation coverage.

### (b)           Following the occurrence of a Termination Event described inSection 2.1, to the extent permitted by the Company’s health and welfareplans (other than the medical plan described in Section 2.7(a)), Executive andhis/her covered dependents will be eligible to continue their benefits, and theCompany shall pay Executive’s and his/her covered dependents’ continuationpremiums under such plans for 12 months following the date of such TerminationEvent, provided that the Company’s obligation to make such payments shall ceaseimmediately to the extent that Executive and/or Executive’s covered dependentsare no longer entitled to receive continuation coverage in accordance with theplans.

# **ARTICLE III**

# **TERMINATION AFTER CHANGE IN CONTROL**

## **3.1****         ****InvoluntaryTermination upon or Following Change of Control**. In the event Executive’s employment with the Company and itssubsidiaries is involuntarily terminated at any time by the Company withoutCause either (i) at the time of or within 24 months following theoccurrence of a Change of Control, (ii) within three months prior to aChange of Control, whether or not such termination is at the request of anAcquiror, or (iii) at any time prior to a Change of Control if such terminationis at the request of an Acquiror, then such termination of employment will be aTermination Event and the Company shall pay Executive the compensation andbenefits described in this Article III in the manner and at the timedescribed in Section 3.3, subject to Executive complying with his/herobligations described in Sections 5.4 and 5.5 of this Agreement.  If the Company reasonably believes that aChange of Control will not occur within three months following the terminationof Executive, but in fact a Change of Control does occur within three monthsfollowing such termination, Executive will be provided with the compensationand benefits described in this Article III in the manner and at the timedescribed in Section 3.3.  An “**Acquiror**” is either a person or a member ofa group of related persons representing such group that in either case obtainseffective control of the Company in the transaction or a group of relatedtransactions constituting the Change of Control.  For the elimination of doubt, in the eventExecutive’s employment with the Company and its subsidiaries is involuntarilyterminated by the Company without Cause and the circumstances described in thisSection 3.1 are not applicable, then Article II will apply to suchevent.

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## **3.2****         ****VoluntaryTermination For Good Reason Upon or Following Change of Control**.

### (a)           In the event Executive voluntarilyterminates his/her employment within three months of the occurrence of an eventconstituting Good Reason and on account of an event constituting Good Reason,which event occurs either (i) at the time of or within 24 monthsfollowing the occurrence of a Change of Control, (ii) within three monthsprior to a Change of Control, whether or not such termination is at the requestof an Acquiror, or (iii) at any time prior to a Change of Control if suchtriggering event or Executive’s termination is at the request of an Acquiror,then such termination of employment will be a Termination Event and the Companyshall pay Executive the compensation and benefits described in thisArticle III in the manner and at the time described in Section 3.3,subject to Executive complying with his/her obligations described in Sections5.4 and 5.5 of this Agreement.  If theCompany reasonably believes that a Change of Control will not occur withinthree months following the voluntary termination for Good Reason by Executive,but a Change of Control does in fact occur within three months following suchtermination, Executive will be provided with the compensation and benefits describedin this Article III in the manner and at the time described in Section3.3.

### (b)           In the event Executive voluntarilyterminates his/her employment for any reason other than on account of an eventconstituting Good Reason under the circumstances described inSection 3.2(a), then such termination of employment will *not* be a Termination Event, Executive will*not* be entitled to receive anypayments or benefits under the provisions of this Agreement, and the Companywill cease paying compensation or providing benefits to Executive as ofExecutive’s termination date.

## **3.3****         ****Lump Sum Payment upon Terminationafter Change in Control**.

### (a)           If a Termination Event described inthis Article III occurs, Executive shall receive an amount equal to twotimes the sum of Executive’s Base Salary and Target Bonus, less any applicablewithholding of federal, state, local or foreign taxes; provided, however, thatthe Company may deduct from amounts payable to Executive pursuant to thisArticle III any amounts paid to Executive pursuant to Article II.

### (b)           The salary and bonus amountspayable pursuant to this Article III shall be paid in a single lump sum.  Such payments shall be made (i) not laterthan immediately prior to completion of the Change of Control where theTermination Event occurs prior to a Change of Control or (ii) within twobusiness days after the date of a Termination Event where the Termination Eventoccurs subsequent to a Change of Control.

## **3.4****         ****Bonus for Final Period**.  If a Termination Event described in this Article III occurs,Executive shall receive a pro rated bonus for the performance period in whichthe Termination Event occurs (in addition to the amount described inSection 3.3).  The amount of thebonus shall be equal to Target Bonus for the period in which the TerminationEvent occurred multiplied by a fraction in which (i) the numerator is thenumber of days from and including the first day of the performance period untiland including the date of the Termination Event and (ii) the denominator isthe number of days in the performance period. Such bonus shall be paid at the time prescribed in Section 3.3(b).

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## **3.5****         ****Stock Award Acceleration uponTermination after Change in Control**.

### (a)           Executive’s Stock Options that areoutstanding as of the date of a Termination Event described in thisArticle III shall become fully vested upon the occurrence of suchTermination Event and exercisable so long as Executive complies with therestrictions and limitations set forth in Article V.  The Stock Options shall remain exercisableuntil the second anniversary of the date of the Termination Event provided thatExecutive complies with his/her obligations under Article V of this Agreement.The term “**Stock Options**” shall notinclude any rights of Executive under the Company’s 2006 Employee SharesPurchase Plan or similar plans.

### (b)           Executive’s Restricted Stock awardsthat are outstanding as of the date of a Termination Event described in thisArticle III shall become fully vested and free from any contractual rightsof the Company to repurchase or otherwise reacquire the Restricted Stock as aresult of Executive’s termination of employment.  All shares of Restricted Stock that have notyet been delivered to Executive or his/her designee (whether because subject tojoint escrow instructions or otherwise) shall be promptly delivered toExecutive or his/her designee upon the occurrence of a Termination Eventdescribed in this Article III.

### (c)           Executive’s Stock Units that areoutstanding as of the date of a Termination Event described in thisArticle III shall become fully vested as a result of Executive’stermination of employment.  All StockUnits that have not yet been settled shall be promptly settled, in the formspecified in the relevant Stock Unit agreements and relevant stock plans underwhich the Stock Units were granted, upon the occurrence of a Termination Eventdescribed in this Article III.

## **3.6****         ****Health & Welfare BenefitsCoverage**.

### (a)           Following the occurrence of a Termination Event described in thisArticle III, to the extent permitted by COBRA and by the Company’s grouphealth insurance policies, Executive and his/her covered dependents will beeligible to continue their health insurance benefits at their own expense.  If Executive elects COBRA continuation, theCompany shall pay Executive’s and his/her covered dependents’ COBRAcontinuation premiums for 24 months following the date of such TerminationEvent, provided that the Company’s obligation to make such payments shall ceaseimmediately to the extent that Executive and/or Executive’s covered dependentsare no longer entitled to receive COBRA continuation coverage.  Executive agrees to notify a duly authorizedofficer of the Company, in writing, immediately upon Executive’s or a covereddependent’s beginning to receive health benefits from another source, or asotherwise required by COBRA.  ThisSection 3.6(a) provides only for the Company’s payment of COBRAcontinuation premiums for the periods specified above.  This Section 3.6(a) does not affect therights of Executive or Executive’s covered dependents under any applicable lawwith respect to health insurance continuation coverage.

### (b)           Following the occurrence of a Termination Event described in thisArticle III, to the extent permitted by the Company’s health and welfare plans(other than the medical plan described in Section 3.6(a)), Executive andhis/her covered dependents will be eligible to continue their benefits, and theCompany shall pay Executive’s and his/her covered dependents’ continuationpremiums under such plans for 24 months following the date of such Termination

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### Event,provided that the Company’s obligation to make such payments shall ceaseimmediately to the extent that Executive and/or Executive’s covered dependentsare no longer entitled to receive continuation coverage in accordance with theplans.

# **ARTICLE IV**

# **TERMINATION FOR CAUSE**

## **4.1****         ****General Effect of Termination forCause**.  In the event Executive’s employment with theCompany and its subsidiaries is involuntarily terminated by the Company withCause at any time, whether before or after a Change of Control, then suchtermination of employment will *not* be aTermination Event, Executive will *not*beentitled to receive any payments or benefits under the provisions of thisAgreement, and the Company will cease paying compensation or providing benefitsto Executive as of Executive’s termination date.

## **4.2****         ****Procedure for “Cause” Finding**.

### (a)           Prior to a Change in Control, Executive may only be terminated forCause if a majority of the Board then in office determines that grounds forCause exist.  In the event of suchdetermination, the Company will give Executive notice of the finding of Causewith reasonable specificity, and will provide Executive with a reasonableopportunity to meet with the Board to refute the finding.

#### (1)           If Executive elects toappear before the Board to dispute the finding, the Board will meet with theExecutive.  Following such meeting, theBoard shall reconsider its initial finding and the decision of a majority ofthe Board then in office will be required to confirm the determination thatgrounds for Cause exist.

#### (2)           If Executive declinesto appear before the Board to dispute the finding, then the initial action bythe Board shall constitute the determination to terminate Executive for Cause.

### (b)           Subsequent to a Changein Control, the procedural requirements of Section 4.2(a) shall apply, exceptthat the findings of the Board must be approved by not less than 2/3rds of thedirectors then in office.

# **ARTICLE V**

# **LIMITATIONS AND CONDITIONS ON BENEFITS**

## **5.1****         ****Right to Benefits**. If a Termination Event does not occur, Executive shall not be entitledto receive any benefits described in this Agreement, except as otherwisespecifically set forth herein.  If aTermination Event occurs, Executive shall be entitled to receive the benefitsdescribed in this Agreement only if Executive complies with the restrictionsand limitations set forth in this Article V.

## **5.2****         ****No Mitigation**. Except as otherwise specifically provided herein, Executive shall not berequired to mitigate damages or the amount of any payment provided under thisAgreement by seeking other employment or otherwise, nor shall the amount of anypayment

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## providedfor under this Agreement be reduced by any compensation earned by Executive asa result of employment by another employer or by retirement benefits after thedate of the Termination Event, or otherwise.

## **5.3****         ****Withholding Taxes**. The Company shall withhold appropriate federal, state, local or foreignincome, employment and other applicable taxes from any payments hereunder.

## **5.4****         ****Obligations ofExecutive**.

### (a)           For two years following aTermination Event, Executive agrees not to personally solicit any of theemployees either of the Company or of any entity in which the Company directlyor indirectly possesses the ability to determine the voting of 50% or more ofthe voting securities of such entity (including two-party joint ventures inwhich each party possesses 50% of the total voting power of the entity) tobecome employed elsewhere or provide the names of such employees to any othercompany that Executive has reason to believe will solicit such employees.

### (b)           Following the occurrence of aTermination Event, Executive agrees to continue to satisfy his/her obligationsunder the terms of the Company’s standard form of Agreement RegardingConfidential Information and Proprietary Development previously executed byExecutive (or any comparable agreement subsequently executed by Executive insubstitution or supplement thereto).

### (c)           Executive acknowledges andrecognizes the highly competitive nature of the businesses of the Company andits affiliates and accordingly agrees that for one year following a TerminationEvent, Executive will not, whether on Executive’s own behalf or on behalf of orin conjunction with any person, company, business entity or other organizationwhatsoever, directly or indirectly, either (i) engage in any business thatis a Competitive Business or (ii) enter the employ of, or render anyservices to, any person or entity (or any division of any person or entity)that engages in a Competitive Business. For purposes of this Agreement, the term “**Competitive Business**” shall include any person or entity thatcompetes with any business of the Company or its affiliates at the time of theTermination Event (including, without limitation, businesses that the Companyor its affiliates have specific plans at the time of the Termination Event toconduct in the future, of which plans Executive is aware at that time) in anygeographical area where the Company or its affiliates manufacture, sell, lease,rent, license, or otherwise provide their products or services (including,without limitation, geographical areas where the Company or its affiliates havespecific plans at the time of the Termination Event to engage in one or moresuch activities, of which plans Executive is aware at that time).  Notwithstanding the preceding sentence, aperson or entity shall be treated as a Competitive Business for purposes of thisAgreement only if the Company includes such person or entity (which,unless otherwise specified by the Company, shall be considered to include allof the subsidiaries and other affiliates of such listed person or entity) on alist to be prepared by the Company at or shortly after the time of theTermination Event, such list is provided to Executive, and such list includesnot more than 15 persons or entities.

Notwithstanding any provision in this Agreement to the contrary,it shall not be a violation of this Section 5.4(c) if any one or more ofthe following shall occur:

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##### (i)            Executive may own,directly or indirectly, solely as a passive investment, securities of anyperson engaged in a Competitive Business, which securities are publicly tradedon a national or regional stock exchange or on the over-the-counter market, ifExecutive (A) is not a controlling person of, or a member of a group thatcontrols, such person and (B) does not, directly or indirectly, own 5% ormore of any class of securities of such person.

##### (ii)           If Executive isproviding services to or for the benefit of an entity that has two or moredistinct business units, at least one of which does not constitute aCompetitive Business, Executive may provide services to such entity so long asExecutive does not provide services, directly or indirectly, to or for thebenefit of a business unit that constitutes a Competitive Business.

##### (iii)          If Executive isproviding services to or for the benefit of an entity that does not engage in aCompetitive Business, and such entity subsequently is acquired by a person orentity that does engage in a Competitive Business, Executive may continue suchemployment so long as Executive does not personally engage, directly orindirectly, in such Competitive Business or otherwise advise or assist such CompetitiveBusiness.

### (d)           It is expressly understood andagreed that although Executive and the Company consider the restrictionscontained in this Section 5.4 to be reasonable, if a final judicialdetermination is made by a court of competent jurisdiction that the time orterritory or any other restriction contained in this Agreement is anunenforceable restriction against Executive, the provisions of this Agreementshall not be rendered void but shall be deemed amended to apply as to suchmaximum time or territory and to such maximum extent as such court mayjudicially determine or indicate to be enforceable.  Alternatively, if any court of competentjurisdiction finds that any restriction contained in this Agreement is unenforceable,and such restriction cannot be amended so as to make it enforceable, suchfinding shall not affect the enforceability of any of the other restrictionscontained herein.

### (e)           Executive acknowledges and agreesthat the Company’s remedies at law for a breach or threatened breach of any ofthe provisions of Section 5.4(a), (b) or (c) would be inadequate and,in recognition of this fact, Executive agrees that, in the event of such abreach or threatened breach, in addition to any remedies at law, the Company,without posting any bond, shall be entitled to cease making any payments orproviding any benefit otherwise required by this Agreement and, with respect toa breach or threatened breach of Section 5.4(a) or (b) only, obtainequitable relief in the form of specific performance, temporary restrainingorder, temporary or permanent injunction, or any other equitable remedy thatmay then be available.

## **5.5****         ****Employee Release Prior to Receiptof Benefits**.  Upon the occurrence of a Termination Event,and prior to the receipt of any benefits under this Agreement on account of theoccurrence of the Termination Event, Executive shall, as of the date of theTermination Event, execute an employee release substantially in the formattached hereto as Exhibit A.  Suchemployee release shall specifically relate to all of Executive’s rights andclaims in existence at the time of such execution relating to Executive’semployment with the Company, but shall not include (i) Executive’s rightsunder this Agreement, (ii) Executive’s rights under any employee benefitplan sponsored by the Company or (iii) Executive’s rights toindemnification or advancement of expenses under applicable law, the Company’sbylaws or other governing

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## instrumentsor any agreement addressing such subject matter between Executive and theCompany.  It is understood that Executivehas 21 days to consider whether to execute such employee release and Executivemay revoke such employee release within seven days after execution of suchemployee release.  In the event Executivedoes not execute such employee release within the 21-day period, or ifExecutive revokes such employee release within the seven-day period, nobenefits shall be payable under this Agreement and this Agreement shall be nulland void.  Nothing in this Agreementshall limit the scope or time of applicability of such employee release once itis executed and not timely revoked.

## **5.6****         ****Compliancewith Section 409A**.  Inthe event that (i) one or more payments of compensation or benefitsreceived or to be received by Executive pursuant to this Agreement (“**Agreement Payment**”) would constitutedeferred compensation subject to Section 409A of the Internal Revenue Codeof 1986, as amended (the “**Code**”),and (ii) Executive is deemed at the time of such termination of employmentto be a “specified employee” under Section 409A(a)(2)(B)(i) of the Code,then such Agreement Payment shall not be made or commence until the earlier of(i) the expiration of the six-month period measured from the date ofExecutive’s “separation from service” (as such term is at the time defined inTreasury Regulations under Section 409A of the Code) with the Company or(ii) such earlier time permitted under Section 409A of the Code andthe regulations or other authority promulgated thereunder; provided, however,that such deferral shall only be effected to the extent required to avoidadverse tax treatment to Executive under Section 409A of the Code,including (without limitation) the additional 20% tax for which Executive wouldotherwise be liable under Section 409A(a)(1)(B) of the Code in the absenceof such deferral.  During any period inwhich an Agreement Payment to Executive is deferred pursuant to the foregoing,Executive shall be entitled to interest on the deferred Agreement Payment at aper annum rate equal to the highest rate of interest applicable to six-monthnon-callable certificates of deposit with daily compounding offered by CitibankN.A., Wells Fargo Bank, N.A. or Bank of America on the date of such separationfrom service.  Upon the expiration of theapplicable deferral period, any Agreement Payment that would have otherwisebeen made during that period (whether in a single sum or in installments) inthe absence of this Section 5.6 shall be paid to Executive or his/herbeneficiary in one lump sum, including all accrued interest.

## **5.7****         ****Golden Parachute Payments**.

### (a)           In the event that any payment received or to bereceived by Executive pursuant to this Agreement or otherwise (“**Payment**”) would be subject to the excisetax imposed by Section 4999 of the Code, or any comparable federal, state,local or foreign excise tax (such excise tax, together with any interest andpenalties, is hereinafter collectively referred to as the “**Excise Tax**”), then Executive shall beentitled to receive an additional payment from the Company (“**Gross-Up Payment**”) in such an amount thatafter the payment of all taxes (including, without limitation, any interest andpenalties on such taxes and the Excise Tax) on the Payment and on the Gross-UpPayment, Executive shall retain an amount equal to (a) the Payment minus(b) all applicable taxes on the Payment other than the Excise Tax.  The intent of the parties is that theCompany shall be solely responsible for, and shall pay, any Excise Tax on thePayment and Gross-Up Payment and any income, employment and other taxes (including, without limitation,penalties and interest) imposed on the Gross-Up Payment (as well as any loss oftax deduction caused by the Payment or the Gross-Up Payment).  Notwithstandingthe

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### foregoing, in theevent that Excise Taxes could be avoided by a reduction in payments toExecutive pursuant to this Agreement, the Company may reduce such payments tobring the total payments to that amount that falls immediately below thethreshold triggering the Excise Tax, up to a total reduction not to exceed$25,000.

### (b)           Unless the Company and Executiveotherwise agree in writing, all determinations required to be made under thisSection 5.7 and the assumptions to be utilized in arriving at suchdeterminations shall be made in writing in good faith by an independent taxprofessional designated by the Company and reasonably acceptable to Executive(the “***Independent Tax Professional***”).  For purposes of making the calculationsrequired by this Section 5.7, the Independent Tax Professional may makereasonable assumptions and approximationsconcerning applicable taxes and may rely on reasonable, good-faithinterpretations concerning the application of Sections 280G and 4999of the Code.  The Company and Executiveshall furnish to the Independent Tax Professional such information anddocuments as the Independent Tax Professional may reasonably request in orderto make a determination under this Section 5.7.  The Company shall bear all costs that theIndependent Tax Professional may reasonably incur in connection with anycalculations contemplated by this Section 5.7.

# **ARTICLE VI**

# **OTHER RIGHTS AND BENEFITS NOTAFFECTED**

Nothing in the Agreement shall prevent or limitExecutive’s continuing or future participation in any benefit, bonus, incentiveor other plans, programs, policies or practices provided by the Company and forwhich Executive may otherwise qualify, nor shall anything herein limit suchgreater rights as Executive may have under any agreements with the Companyapplicable to his/her Stock Options, Restricted Stock, Stock Units or otherequity awards; *provided*, *however*, that any benefits providedhereunder shall be in lieu of any other severance benefits to which Executivemay otherwise be entitled, including (without limitation) under any employmentcontract or severance plan, program or arrangement.  Except as otherwise expressly providedherein, amounts that are vested benefits or that Executive is otherwiseentitled to receive under any plan, policy, practice or program of the Companyat or subsequent to the date of a Termination Event shall be payable inaccordance with such plan, policy, practice or program.

# **ARTICLE VII**

# **NON-ALIENATION OF BENEFITS**

Nobenefit hereunder shall be subject to anticipation, alienation, sale, transfer,assignment, pledge, encumbrance or charge, and any attempt to do so shall bevoid.

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# **ARTICLE VIII**

# **DEFINITIONS**

Forpurposes of the Agreement, the following terms shall have the meanings setforth below:

## **8.1****         **“***Base Salary***” means Executive’sannual salary (excluding bonus, any other incentive or other payments and stockoption exercises) from the Company at the time of the occurrence of the Changeof Control (if applicable) or the Termination Event, whichever is greater.

## **8.2****         **“***Cause***” means (i) an unauthorized use or disclosureby Executive of the Company’s confidential information or trade secrets, whichuse or disclosure causes material harm to the Company, (ii) a materialbreach by Executive of a material agreement between Executive and the Company,(iii) a material failure by Executive to comply with the Company’s writtenpolicies or rules resulting in material harm to the Company,(iv) Executive’s conviction of, or plea of “guilty” or “no contest” to, afelony under the laws of the United States or any State thereof or theequivalent under the applicable laws outside of the United States,(v) Executive’s gross negligence or willful misconduct resulting inmaterial harm to the Company, (vi) a continuing failure by Executive toperform assigned duties after receiving written notification of such failure or(vii) a failure by Executive to cooperate in good faith with agovernmental or internal investigation of the Company or its directors,officers or employees, if the Company has requested Executive’s cooperation.

## **8.3****         **“***Change of Control***” means:

### (a)           The consummation of amerger or consolidation of the Company with or into another entity or any othercorporate reorganization, if persons who were not shareholders of the Companyimmediately prior to such merger, consolidation or other reorganization ownimmediately after such merger, consolidation or other reorganization 50% ormore of the voting power of the outstanding securities of each of (i) thecontinuing or surviving entity and (ii) any direct or indirect parentcorporation of such continuing or surviving entity;

### (b)           The sale, transfer orother disposition of all or substantially all of the Company’s assets;

### (c)           A change in thecomposition of the Board, as a result of which fewer than 50% of the incumbentdirectors are directors who either:

##### (i)            Had been directors ofthe Company on the date 24 months prior to the date of such change in thecomposition of the Board (the “***Original Directors***”); or

##### (ii)           Were appointed to theBoard, or nominated for election to the Board, with the affirmative votes of atleast a majority of the aggregate of (A) the Original Directors who werein office at the time of their appointment or nomination and (B) thedirectors whose appointment or nomination was previously approved in a mannerconsistent with this Paragraph (ii); or

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### (d)           Any transaction as aresult of which any person is the “beneficial owner” (as defined inRule 13d-3 under the Securities Exchange Act of 1934, as amended (the “***Exchange Act***”)), directly orindirectly, of securities of the Company representing at least 30% of the totalvoting power represented by the Company’s then outstanding votingsecurities.  For purposes of thisSubsection (d), the term “person” shall have the same meaning as when usedin Sections 13(d) and 14(d) of the Exchange Act but shall exclude(i) a trustee or other fiduciary holding securities under an employeebenefit plan of the Company or of a Parent or Subsidiary and (ii) acorporation owned directly or indirectly by the shareholders of the Company insubstantially the same proportions as their ownership of Shares.

A transaction shall notconstitute a Change in Control if its sole purpose is to change thejurisdiction of the Company’s incorporation or to create a holding company thatwill be owned in substantially the same proportions by the persons who held theCompany’s securities immediately before such transaction.

## **8.4****         **“***Company***” means Verigy Ltd., a Singapore corporation,and any successor thereto and its subsidiaries; provided, however, that withrespect to determining whether a Change in Control has occurred, the term “Company”shall mean Verigy Ltd. exclusively.

## **8.5****         **“***Disability***” means thatExecutive is unable to perform the duties of his/her office with the Company orany subsidiary, and is unable to perform substantially equivalent duties, byreason of any medically determinable physical or mental impairment, and such condition has lasted or can be expected to lastfor a continuous period of not less than 12 months.

## **8.6****         **“***Good Reason***” means: (i) a reduction of Executive’srate of compensation as in effect on the Effective Date of this Agreement or,if a Change of Control has occurred, as in effect immediately prior to theoccurrence of a Change of Control, other than reductions in Base Salary thatapply broadly to employees of the Company or reductions due to varying metricsand achievement of performance goals for different periods under variable-payprograms; (ii) either (A) failure to provide a package of benefitsthat, taken as a whole, provides substantially similar benefits to those inwhich Executive is entitled to participate as of the Effective Date (exceptthat employee contributions may be raised to the extent of any cost increasesrelated to such benefits where such increases in employee contributions arebroadly applicable to employees of the Company) or (B) any action by theCompany that would significantly and adversely affect Executive’s participationor reduce Executive’s benefits under any of the Company’s benefit plans, otherthan changes that apply broadly to employees of the Company; (iii) achange in Executive’s duties, responsibilities, authority, job title orreporting relationships resulting in a significant diminution of position,excluding for this purpose an isolated, insubstantial and inadvertent actionnot taken in bad faith that is remedied by the Company promptly after noticethereof is given by Executive; (iv) a request that Executive relocate to aworksite that is more than 25 miles from his/her prior worksite, unless Executiveaccepts such relocation opportunity; (v) a failure or refusal of asuccessor to the Company to assume the Company’s obligations under thisAgreement, as provided in Section 9.9 or (vi) a material breach bythe Company or any successor to the Company of any of the material provisionsof this Agreement.  [***Last Sentence******Version A***:  For purposes of clause (iii) of theimmediately preceding sentence, Executive’s duties, responsibilities,authority, job title or reporting relationships shall not be considered to besignificantly diminished (and therefore shall not constitute “Good Reason”) so

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## long as Executive continues to perform substantially the samefunctional role for the Company as Executive performed immediately prior to theoccurrence of the Change of Control, even if the Company becomes a subsidiaryor division of another entity.] [***Last Sentence******Version B***:  For purposes of clause (iii) of theimmediately preceding sentence, Executive’s duties, responsibilities,authority, job title or reporting relationships shall be considered to besignificantly diminished (and therefore shall constitute “Good Reason”) ifExecutive no longer to performs substantially the same functional role for theCompany as Executive performed immediately prior to the occurrence of theChange of Control of an entity whose equity securities are publicly traded;provided, however, that prior to terminating his/her employment for Good Reasonunder clause (iii) of the immediately preceding sentence solely as a result ofthe entity for which Executive is providing services not being an entity whosesecurities are publicly traded, Executive shall notify the successor entity ofhis/her intention to so terminate his/her employment and shall provide thesuccessor entity with a reasonable period of time, not to exceed 90 days, tonegotiate terms of employment which meet Executive’s requirements.  If, at the end of the notice and negotiationperiod, the parties are unable to arrive at mutually satisfactory terms andconditions of employment, then Executive may exercise his/her right totermination for good reason as a result of no longer serving in a comparablerole with a company whose securities are publicly traded.]

## **8.7****         ** “***Target Bonus***”means:

### (a)           With respect to aTermination Event occurring on or before October 31, 2008, the “Target Bonus”shall be an amount equal to the annualized bonus compensation that Executivewould be entitled to receive under the terms of any applicableperformance-based compensation plan in effect at the time of Executive’sTermination Event, as set for Executive by the Compensation Committee of theBoard or other authorized body, covering the 12-month period ending at the endof the performance period during which Executive’s Termination Event occurs,assuming that the performance objectives are fully met.  The “Target Bonus” amount shall equal 100% ofthe target amount regardless of whether or not, or to what degree, the actualperformance objectives are met.

### (b)           With respect to a Termination Eventoccurring on or after November 1, 2008, the “Target Bonus” shall be an amountequal to an average of the annualized bonus compensation paid to Employee withrespect to the two fiscal years of the Company most recently preceding the dateof the Termination Event; provided, however, that if the Executive’s targetbonus in the year in which the Termination Event occurs, expressed as a percentof Executive’s Base Salary, is higher than the percentage target bonus levelsin the years used for purposes of the average, then an equitable adjustmentwill be made to the prior year amounts so as to treat Executive as if s/he wereat the higher target bonus percentage for the years used to determine theaverage.

## **8.8****         **“***Termination Event***” means an involuntary termination of employmentdescribed in Section 2.1 or 3.1(a) or a voluntary termination ofemployment described in Section 3.2(a). No other event shall be a Termination Event for purposes of thisAgreement.

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# **ARTICLE IX**

# **GENERAL PROVISIONS**

## **9.1****         ****Interpretation**.  The parties acknowledge that Executive mayserve as an officer and/director of the Company as well as an officer and/ordirector of one or more of the Company’s subsidiaries.  It is the parties’ intention that, whendetermining whether a Termination Event or Change of Control has occurred, theparties will look at the facts and circumstances affecting the highest levelentity in the Company’s corporate family in which Executive plays a role.  For example, an executive officer of theCompany who also served on the Board or as an officer of one or more of theCompany’s subsidiaries will not be deemed to have experienced a change inExecutive’s duties, responsibilities, authority, job title or reportingrelationships resulting in a significant diminution of position solely as aresult of the change at the subsidiary level, i.e., changes implemented solelyat the subsidiary level but not at the higher level would not constitute GoodCause unless the overall effect of the subsidiary-level changes resulted in asignificant diminution of overall position with the Company and itssubsidiaries taken as a whole.

## **9.2****         ****SubsidiariesBound**.  To the extent that Executive isemployed by a subsidiary of Verigy Ltd. and not by Verigy Ltd. itself, (i)Executive’s Base Salary and Target Bonus shall be the amounts as so defined aspayable by Executive’s direct employer; and (ii) to the extent that Verigy Ltd.itself is not the direct employer or otherwise paying the benefits due toExecutive under this Agreement, Verigy Ltd. shall cause the subsidiary directlyemploying Executive to make provide the benefits due to Executive under thisAgreement.

## **9.3****         ****Notices**.  Any notices provided hereunder must be inwriting, and such notices or any other written communication shall be deemedeffective upon the earlier of personal delivery (including personal delivery byfacsimile) or the third day after mailing by first-class mail, to the Companyat its primary U.S. office location and to Executive at Executive’s address aslisted in the Company’s payroll records. Any payments made by the Company to Executive under the terms of thisAgreement shall be delivered to Executive either in person or at such addressas listed in the Company’s payroll records.

## **9.4****         ****Severability**.  It is the intent of the parties to thisAgreement that, whenever possible, each provision of this Agreement shall beinterpreted in such manner as to be effective and valid under applicable law,but if any provision of this Agreement is held to be invalid, illegal orunenforceable in any respect under any applicable law or rule in anyjurisdiction, such invalidity, illegality or unenforceability shall not affectany other provision or any other jurisdiction, but this Agreement shall bereformed, construed and enforced in such jurisdiction as if such invalid, illegalor unenforceable provisions had never been contained herein.

## **9.5****         ****Waiver**.  If either party should waive any breach ofany provisions of this Agreement, that party shall not thereby be deemed tohave waived any preceding or succeeding breach of the same or any otherprovision of this Agreement.

## **9.6****         ****Complete Agreement**.  This Agreement, including Exhibit A,constitutes the entire agreement between Executive and the Company and is thecomplete, final and exclusive

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## embodiment of their agreement with regard to this subject matter;provided that nothing herein shall limit such greater rights as Executive mayhave under any agreements with the Company applicable to his/her Stock Options,Restricted Stock, Stock Units or other equity awards.  This Agreement shall be deemed to be anamendment of any agreements between Executive and the Company applicable tohis/her Stock Options, Restricted Stock, Stock Units or other equity awards tothe extent that this Agreement provides greater rights.  This Agreement is entered into withoutreliance on any promise or representation other than those expressly containedherein.  Without limiting the foregoing,this Agreement supersedes and replaces all prior agreements andunderstandings, whether written or oral, on the matters set forth herein thatmay exist between Executive and the Company or its predecessor, AgilentTechnologies, Inc. or any of their respective subsidiaries.

## **9.7****         ****Counterparts**.  This Agreement may be executed in separatecounterparts, any one of which need not contain signatures of more than oneparty, but all of which taken together will constitute one and the sameAgreement.

## **9.8****         ****Headings**.  The headings of the Articles and Sectionshereof are inserted for convenience only and shall neither be deemed toconstitute a part hereof nor to affect the meaning thereof.

## **9.9****         ****Successors andAssigns**.  This Agreement is intended to bindand inure to the benefit of and be enforceable by Executive and the Company,and their respective successors, assigns, heirs, executors and administrators,except that Executive may not delegate any of Executive’s duties hereunder andmay not assign any of Executive’s rights hereunder without the written consentof the Company, which consent shall not be withheld unreasonably.  Any successor to the Company (whether director indirect and whether by purchase, merger, consolidation, liquidation orotherwise) to all or substantially all of the Company’s business and/or assetsshall assume the Company’s obligations under this Agreement in the same mannerand to the same extent as the Company would be required to perform suchobligations in the absence of a succession. For all purposes under this Agreement, the term “Company” shall includeany successor to the Company’s business and/or assets, whether or not suchsuccessor executes and delivers an assumption agreement referred to in thepreceding sentence or becomes bound by the terms of this Agreement by operationof law or otherwise.

## **9.10****       ****Amendment orTermination of this Agreement**.  ThisAgreement may be changed or terminated only upon the mutual written consent ofthe Company and Executive.

## **9.11****       ****Attorney Fees**.  If either party hereto brings any action toenforce such party’s rights hereunder, the prevailing party in any such actionshall be entitled to recover such party’s reasonable attorneys’ fees and costsincurred in connection with such action.

## **9.12****       ****Arbitration**.  In order to ensure rapid and economicalresolution of any dispute that may arise under this Agreement, Executive andthe Company agree that any and all disputes or controversies arising from orregarding the interpretation, performance, enforcement or termination of thisAgreement shall first be submitted for non-binding mediation.  If complete agreement cannot be reachedwithin 60 days after the date of submission to mediation, any remaining issueswill be submitted to the American Arbitration Association to be resolved by

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## final and binding arbitration under the its NationalRules for the Resolution of Employment Disputes and California Law.

## **9.13****       ****Choice of Law**.  All questions concerning the construction,validity and interpretation of this Agreement will be governed by the laws ofthe State of California.

## **9.14****       ****Construction ofAgreement**.  In the event of aconflict between the text of the Agreement and any summary, description orother information regarding the Agreement, the text of the Agreement shallcontrol.

**In Witness Whereof**,the parties have executed this Agreement on the day and year written above.
| **Verigy Ltd.,**                               | ** ** | **EXECUTIVE** |
|------------------------------------------------|------------|---------------|
| **a Singapore corporation**                    |       |          |
|                                           |       |          |
|                                           |       |          |
|                                           |       |          |   |
| (Signature of Authorized Signatory)            |       | Signature     |
|                                           |       |          |
|                                           |       |          |
|                                           |       |          |
| (Print Name & Title of Signatory)          |       |          |
|                                           |       |          |
|                                           |       |          |
| Exhibit A:  General Release and Agreement |       |          |

 

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**Exhibit A**

**GENERAL RELEASE AND AGREEMENT**

This GeneralRelease and Agreement (the “**Agreement**”) ismade and entered into by                                 (“**Executive**”).  The Agreement is part of an agreement betweenExecutive and Verigy Ltd. (“**Verigy**”) to terminateExecutive’s employment with Verigy on the terms set forth in the SeveranceAgreement dated                  ,200  , between Verigy and Executive (the “**SeveranceAgreement**”).

Verigy andExecutive hereby agree as follows:

1.                                       Executive agrees to attend aFunctional Exit Interview on                          ,20    , at which time all company property andidentification will be turned in and the appropriate personnel documents willbe executed.  Thereafter, Executiveagrees to do such other acts as may be reasonably requested by Verigy in orderto effectuate the terms of this Agreement. Executive agrees to remove all personal effects from his/her currentoffice within seven days of signing this Agreement and in any event not laterthan                        ,20    .

2.                                       Executive agrees not to make anypublic statement or statements to the press concerning Verigy, its businessobjectives, its management practices, or other sensitive information withoutfirst receiving Verigy’s written approval. Executive further agrees to take no action that would cause Verigy orits employees or agents any embarrassment or humiliation or otherwise cause orcontribute to Verigy’s or any such person’s being held in disrepute by thegeneral public or Verigy’s employees, clients, or customers.  Verigy agrees to take no action that wouldcause Executive any embarrassment or humiliation or otherwise cause orcontribute to Executive’s being held in disrepute by the general public or byVerigy’s employees, clients or customers.

3.                                       Executive, on behalf of Executiveand his/her heirs, estate, executors, administrators, successors and assigns,does fully release, discharge, and agree to hold harmless Verigy, its officers,agents, employees, attorneys, subsidiaries, affiliated companies, predecessors,successors and assigns from all actions, causes of action, claims, judgments,obligations, damages, liabilities, costs, or expense of whatsoever kind andcharacter that he may have, **including butnot limited to**:

a.                                       any claims relating to employmentdiscrimination on account of race, sex, age, national origin, creed,disability, or other basis, whether or not arising under the Federal CivilRights Acts, the Age Discrimination in Employment Act, California FairEmployment and Housing Act, the Rehabilitation Act of 1973, the Americans WithDisabilities Act, any amendments to the foregoing laws, or any other federal,state, county, municipal, foreign or other law, statute, regulation or orderrelating to employment discrimination;

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b.                                      any claims relating to pay or leaveof absence arising under the Fair Labor Standards Act, the Family Medical LeaveAct, and any similar laws enacted in California or any other jurisdiction;

c.                                       any claims for reemployment,salary, wages, bonuses, vacation pay, stock options, acquired rights,appreciation from stock options, stock appreciation rights, benefits or othercompensation of any kind;

d.                                      any claims relating to, arising outof, or connected with Executive’s employment with Agilent Technologies, Inc. (“**Agilent**”) or Verigy, or their respective subsidiaries,whether or not the same be based upon any alleged violation of public policy;compliance (or lack thereof) with any internal policy, procedure, practice orguideline; or any oral, written, express, and/or implied employment contract oragreement, or the breach of any terms thereof, including but not limited to,any implied covenant of good faith and fair dealing; or any federal, state,county, municipal or foreign law, statute, regulation or order, whether or notrelating to labor or employment; **and**

e.                                       any claims relating to, arising outof, or connected with any other matter or event occurring prior to theexecution of this Agreement, whether or not brought before any judicial,administrative, or other tribunal.

The foregoing notwithstanding, Executive does not release anyactions, causes of action, claims, judgments, obligations, damages,liabilities, costs or expense of whatsoever kind and character that he may havewith respect to (i) Executive’s rights under this Agreement or theSeverance Agreement, (ii) Executive’s rights under any employee benefitplan sponsored by Agilent or Verigy or (iii) Executive’s rights toindemnification or advancement of expenses under applicable law, the bylaws ofAgilent or Verigy, or other governing instruments or any agreement addressingsuch subject matter between Executive and Agilent or Verigy.

4.                                       Executive represents and warrantsthat Executive has not assigned any such claim or authorized any other personor entity to assert such claim on Executive’s behalf.  Further, Executive agrees that under thisAgreement Executive waives any claim for damages incurred at any time in thefuture because of alleged continuing effects of past wrongful conduct involvingany such claims and any right to sue for injunctive relief against the allegedcontinuing effects of past wrongful conduct involving such claims.

5.                                       In entering into this Agreement,the parties have intended that this Agreement be a full and final settlement ofall matters, whether or not presently disputed, that could have arisen betweenthem.

6.                                       **Executive understands andexpressly agrees that this Agreement extends to all claims of every nature andkind whatsoever, known or unknown, suspected or unsuspected, past or present,and all rights under Section 1542 of the California Civil Code and/or anysimilar statute or law or any other jurisdiction are hereby expressly waived.** Such Section reads as follows:

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“Section 1542.  A general release does not extend to claims whichthe creditor does not know or suspect to exist in his/her favor at the time ofexecuting the release, which if known by him must have materially affectedhis/her settlement with the debtor.”

7.                                       It is expressly agreed that theclaims released pursuant to this Agreement include all claims againstindividual employees of Verigy, whether or not such employees were actingwithin the course and scope of their employment.

8.                                       Executive understands and agreesthat, as a condition of this Agreement, Executive shall not be entitled to anyemployment (including employment as an independent contractor or otherwise)with Verigy, its subsidiaries or related companies, or any successor, andExecutive hereby waives any right, or alleged right, of employment or re-employmentwith Verigy.  Executive further agreesnot to apply for employment with Verigy in the future and not to institute orjoin any action, lawsuit or proceeding against Verigy, its subsidiaries,related companies or successors for any failure to employ Executive.  In the event Executive should secure suchemployment, it is agreed that such employment is voidable without cause in thesole discretion of Verigy.  Afterterminating Executive’s employment, should Executive become employed by anothercompany that Verigy merges with or acquires after the date of this Agreement,Executive may continue such employment only if Verigy makes offers ofemployment to all employees of the acquired or merged company.

9.                                       Executive agrees that the terms,amount and fact of settlement shall be confidential until Verigy needs to makeany required disclosure of any agreements between Verigy and Executive.  Therefore, except as may be necessary toenforce the rights contained herein in an appropriate legal proceeding or asmay be necessary to receive professional services from an attorney, accountant,or other professional adviser in order for such adviser to render professionalservices, Executive agrees not to disclose any information concerning thesearrangements to anyone, including, but not limited to, past, present and futureemployees of Verigy, until such time of the public filings.

10.                                 The terms of this Agreement areintended by the parties as a final expression of their agreement with respectto such terms as are included in this Agreement and may not be contradicted byevidence of any prior or contemporaneous agreement.  The parties further intend that thisAgreement constitutes the complete and exclusive statement of its terms and thatno extrinsic evidence whatsoever may be introduced in any judicial or otherproceeding, if any, involving this Agreement. No modification of this Agreement shall be effective unless in writingand signed by both parties hereto.

11.                                 It is further expressly agreed andunderstood that Executive has not relied upon any advice from Verigy and/or itsattorneys whatsoever as to the taxability, whether pursuant to federal, state,local or foreign income tax statutes or regulations or otherwise, of thepayments made hereunder and that Executive will be solely liable for all taxobligations, if any, arising from payment of the sums specified herein andshall hold Verigy harmless from any tax obligations arising from said payment.

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12.                                 If there is any dispute arising outof or related to this Agreement, which cannot be settled by good-faithnegotiation between the parties, such dispute will be submitted to JAMS fornon-binding mediation.  If completeagreement cannot be reached within 60 days of submission to mediation, anyremaining issues will be submitted to JAMS for final and binding arbitrationpursuant to JAMS Arbitration Rules and Procedures for Employment Disputes.  The reference to JAMS shall refer to anysuccessor to JAMS, if applicable.  **BY ENTERING INTO THIS AGREEMENT, EXECUTIVEACKNOWLEDGES THAT EXECUTIVE IS WAIVING EXECUTIVE’S RIGHT TO JURY TRIAL OF ANYDISPUTE COVERED BY THIS AGREEMENT.**

13.                                 **The following notice is providedin accordance with the provisions of Federal Law**:

You have up to 21 days from the date this GeneralRelease and Agreement is given to you in which to accept its terms, althoughyou may accept it any time within those 21 days.  You are advised to consult with an attorneyregarding this Agreement.  You have theright to revoke your acceptance of this Agreement at any time within seven daysfrom the date you sign it, and this Agreement will not become effective andenforceable until this seven-day revocation period has expired.  To revoke your acceptance, you must send awritten notice of revocation to Verigy Ltd., Attention: Vice President andGeneral Counsel, by 5:00 p.m. on or before the seventh day after you sign thisAgreement.

**EXECUTIVE FURTHERSTATES THAT EXECUTIVE HAS HAD THE OPPORTUNITY TO CONSULT WITH THE ATTORNEY OFEXECUTIVE’S CHOICE, THAT EXECUTIVE HAS CAREFULLY READ THIS AGREEMENT, THATEXECUTIVE HAS HAD AMPLE TIME TO REFLECT UPON AND CONSIDER ITS CONSEQUENCES,THAT EXECUTIVE FULLY UNDERSTANDS ITS FINAL AND BINDING EFFECT, THAT THE ONLYPROMISES MADE TO EXECUTIVE TO SIGN THIS AGREEMENT ARE THOSE STATED ABOVE OR INTHE SEVERANCE AGREEMENT, AND THAT EXECUTIVE IS SIGNING THIS AGREEMENTVOLUNTARILY.**

IN WITNESSWHEREOF, this Agreement has been executed in duplicate originals on the datesindicated below, and shall become effective as indicated above.

**EXECUTIVE**
| Signature:  |   |   |
|-------------|--------|--------|
|        |   |   |
| Print Name: |   |   |
|        |   |   |
| Date:       |   |   |
|             |        |        |  |  |

 

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