Document:

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                                                                   EXHIBIT 10.23

                            INDEMNIFICATION AGREEMENT

         AGREEMENT between Cooper Industries, Ltd., a Bermuda Company (the
"Company"), and _________________________ (the "Indemnitee").

         WHEREAS, Cooper Industries, Inc. ("Cooper Ohio") has decided to
reorganize and effectively change its legal domicile from Ohio to Bermuda (the
"Reorganization");

         WHEREAS, the Reorganization was accomplished pursuant to, among other
things, the Merger Agreement, dated as of June 11, 2001 (the "Merger
Agreement"), among the Company, a newly formed Bermuda corporation that became
the publicly traded parent holding company for the reorganization ("Cooper
Bermuda"), Cooper Ohio and Cooper Mergerco, Inc. ("Merger Sub");

         WHEREAS, pursuant to the Merger Agreement (i) Merger Sub merged into
Cooper Ohio (the "Merger"), with Cooper Ohio being the surviving company in the
Merger and becoming a wholly-owned, indirect subsidiary of the Company, and (ii)
each outstanding share of Cooper Ohio common stock, par value $5.00 per share,
automatically became a Class A common share, par value U.S. $.01 per share of
the Company;

         WHEREAS, each of the directors of Cooper Ohio and substantially all of
the executive officers of Cooper Ohio became the directors and executive
officers of the Company;

         WHEREAS, it is essential to the Company to retain the current directors
and executive officers of Cooper Ohio who became the directors and executive
officers of Cooper Bermuda and to retain other key executives of Cooper Ohio and
its subsidiaries;

         WHEREAS, the Bye-laws of the Company provide that the indemnification
provided therein shall not be exclusive;

         WHEREAS, the Company wishes to provide the directors, executive
officers and other key executives of Cooper Ohio with substantially the same
indemnification such person currently has from Cooper Ohio;

         NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties hereto agree
as follows:

         1.       Certain Definitions:

         (a)      Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company

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or a corporation owned directly or indirectly by the stockholders of the Company
in substantially the same proportions as their ownership of stock of the
Company, is or becomes the "beneficial owner" (as defined in Rule 13d-3 under
said Act), directly or indirectly, of securities of the Company representing 15%
or more of the total voting power represented by the Company's then outstanding
Voting Securities without the prior approval of the Board of Directors, or (ii)
during any period of two consecutive years, individuals who at the beginning of
such period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for election by
the Company's stockholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof, or (iii) the
stockholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
(iv) the stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets. For purposes of determining whether
clause (ii) above has been complied with, the directors of Cooper Ohio on the
effective date of the Merger shall be included in the determination of who the
directors of Cooper Bermuda were during the relevant two year period until the
second anniversary of the effective date of the Merger.

         (b)      Claim: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation, whether conducted by the Company or
any other party, that Indemnitee in good faith believes might lead to the
institution of any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or other.

         (c)      Expenses: include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on appeal) or
preparing to defend, be a witness in or participate in, any Claim relating to
any Indemnifiable Event (including all interest, assessments and other charges
paid or payable in connection with or in respect of any of the foregoing).

         (d)      Judgments: include judgments, fines, penalties and amounts
paid in settlement that are paid or payable in connection with any Claim
relating to any Indemnifiable Event (including all interest, assessments and
other charges paid or payable in connection with or in respect of any of the
foregoing).

         (e)      Indemnifiable Event: any event or occurrence related to the
fact that Indemnitee is or was a director, officer or representative of the
Company, or is or was serving at the request of the Company in accordance with
the Company's "Code of Ethics and Business Conduct," as a director, trustee,
officer, employee, agent or representative of another corporation, domestic or
foreign, nonprofit or for profit, partnership, joint venture, employee benefit
plan, trust or other enterprise, or by reason of anything done or not done by
Indemnitee in any such capacity, except for any actions

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by Indemnitee determined by a court to constitute fraud or dishonesty in the
performance of his or her duties to the Company.

         (f)      Reviewing Party: any appropriate person or body consisting of
a member or members of the Company's Board of Directors or any other person or
body appointed by the Board (including the special, independent counsel referred
to in Section 3) who is not a party to the particular Claim for which Indemnitee
is seeking indemnification.

         (g)      Voting Securities: any securities of the Company that vote
generally in the election of directors, but does not include the Class B common
shares, par value U.S. $.01 per share, of the Company.

         2.       Scope of Indemnification

         (a)      Indemnification of Judgments and Expenses. In the event
Indemnitee was, is or becomes a party to or witness or other participant in, or
is threatened to be made a party to or witness or other participant in, a Claim
by reason of (or arising in part out of) an Indemnifiable Event, the Company
shall indemnify Indemnitee to the fullest extent permitted by law against any
and all Expenses and Judgments arising from or relating to such Claim. Except as
otherwise provided in Section 2(b), such indemnification shall be made as soon
as practicable, but in any event not later than thirty (30) days, after written
demand therefor is presented to the Company by or on behalf of the Indemnitee.

         (b)      Indemnification and Advance Payment of Expenses. Any and all
Expenses indemnifiable under Sections 2(a) and 2(c) shall be paid by the Company
promptly as they are incurred by Indemnitee (any such payment of expenses by the
Company is hereinafter referred to as an "Expense Advance"). Indemnitee shall be
obligated, and hereby agrees, to repay the amount of Expenses so paid only to
the extent that Indemnitee shall have been adjudged by the Supreme Court in
Bermuda or the court in which such action or suit was brought to be liable for
fraud or dishonesty in the performance of his or her duty to the Company.
Indemnitee hereby further agrees to reasonably cooperate with the Company
concerning any Claim.

         (c)      Indemnification for Additional Expenses. The Company shall
                  indemnify Indemnitee to the fullest extent permitted by law
against any and all expenses (including attorneys' fees) that are incurred by
Indemnitee in connection with any claim asserted against or action brought by
Indemnitee for (i) indemnification of Expenses or Judgments or advance payment
of Expenses by the Company under this Agreement or under any other agreement,
the Company's Bye-laws, statute or rule of law now or hereafter in effect
relating to Claims for Indemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policy or policies maintained by
the Company, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, advance Expense payment or insurance recovery,
as the case may be.

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         (d)      Partial Indemnity. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of the Judgments and Expenses arising from or relating to a Claim but
not, however, for all of the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is
entitled.

         (e)      Indemnification of Successful Defense Expenses.
Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee has been successful on the merits or otherwise in defense of any or
all Claims relating in whole or in part to an Indemnifiable Event or in defense
of any issue or matter therein, including dismissal without prejudice,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.

         3.       Reviewing Party Determinations.

         (a)      General Rules. The Reviewing Party, in its discretion, may
review the rights of Indemnitee to indemnity payments under this Agreement.
Notwithstanding the provisions of Section 2, the obligations of the Company
under Section 2(a) shall be subject to the condition that the Reviewing Party
shall not have determined (in a written opinion, in any case in which the
special, independent counsel referred to in Section 4 hereof is involved) that
Indemnitee would not be permitted to be indemnified under applicable law;
provided, however, that if Indemnitee has commenced, or thereafter commences,
legal proceedings in a court of competent jurisdiction to secure a determination
that Indemnitee should be indemnified under applicable law, any determination
made by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding until a final judicial
determination is made with respect thereto (as to which all rights of appeal
therefrom have been exhausted or lapsed) and any such determination by the
Reviewing Party shall be modified, to the extent necessary, to conform to such
final judicial determination.

         (b)      Selection of Reviewing Party. If there has not been a Change
in Control, the Reviewing Party shall be selected by the Board of Directors as
soon as practicable after notice of a claim for indemnification. If there has
been such a Change in Control, the Reviewing Party shall be the special,
independent counsel referred to in Section 4 hereof.

         (c)      Judicial Review. If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantially would not be permitted to be indemnified in whole or in part under
applicable law, Indemnitee shall have the right to commence litigation in any
court having subject matter jurisdiction thereof seeking an initial
determination by the court or challenging any such determination by the
Reviewing Party or any aspect thereof, and the Company hereby consents to
service of process and to appear in any such proceeding. Any determination by
the Reviewing Party otherwise shall be conclusive and binding on the Company and
Indemnitee.

         (d)      Burden of Proof. In connection with any determination by the
Reviewing Party pursuant to Section 3(a), or by a court of competent
jurisdiction pursuant to Section 3(c) or otherwise, as to whether Indemnitee is
entitled to be indemnified hereunder, the burden of proof shall be on the
Company to establish by clear and convincing evidence that Indemnitee is not so
entitled.

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         4.       Change in Control. The Company agrees that if there is a
Change in Control of the Company then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments under this
Agreement or under any other agreement, the Company's Bye-laws, statute or rule
of law now or hereafter in effect relating to Claims for Indemnifiable Events,
the Company shall seek legal advice only from special, independent counsel
selected by Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services for the
Company or Indemnitee within the last five years (other than in connection with
such matters). Such counsel, among other things, shall render its written
opinion to the Company and Indemnitee as to whether and to what extent the
Indemnitee would be permitted to be indemnified under applicable law. The
Company agrees to pay the reasonable fees of the special, independent counsel
referred to above and to indemnify fully such counsel against any and all
expenses (including attorneys' fees), claims, liabilities and damages arising
out of or relating to this Agreement or its engagement pursuant hereto.

         5.       No Presumption. For purposes of this Agreement, the
termination of any claim, action, suit or proceeding, by judgment, order,
settlement (whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption that
Indemnitee failed to meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law. In addition, neither the failure of the Reviewing
Party to have made a determination as to whether Indemnitee has met any
particular standard of conduct or had any particular belief, nor an actual
determination by the Reviewing Party that Indemnitee has not met such standard
of conduct or did not have such belief, prior to the commencement of legal
proceedings by Indemnitee to secure a judicial determination that Indemnitee
should be indemnified under applicable law shall be a defense to Indemnitee's
claim or create a presumption that Indemnitee has not met any particular
standard of conduct or did not have any particular belief.

         6.       Non-exclusivity. The rights of the Indemnitee hereunder shall
be in addition to any other rights Indemnitee may now or hereafter have to
indemnification by the Company. More specifically, the Parties intend that
Indemnitee shall be entitled to indemnification to the maximum extent permitted
by any or all of the following:

                  (a) The fullest benefits provided by the Company's Bye-laws in
         effect on the date hereof, a copy of the relevant portions of which are
         attached hereto as Exhibit II;

                  (b) The fullest benefits provided by the Bye-laws or their
         equivalent of the Company in effect at the time the Indemnifiable Event
         occurs or at the time Expenses are incurred by Indemnitee;

                  (c) The fullest benefits allowable under Bermuda law in effect
         at the date hereof or as the same may be amended to the extent that
         such benefits are increased thereby;

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                  (d) The fullest benefits allowable under the law of the
         jurisdiction under which the Company exists at the time the
         Indemnifiable Event occurs or at the time Expenses are incurred by the
         Indemnitee; and

                  (e) Such other benefits as are or may be otherwise available
         to Indemnitee pursuant to this Agreement, any other agreement or
         otherwise.

         The parties intend that a combination of two or more of the benefits
referred to in (a) through (e) shall be available to Indemnitee to the extent
that the document or law providing for such benefits does not require that the
benefits provided therein be exclusive of other benefits. The Company hereby
undertakes to use its best efforts to assist Indemnitee, in all proper and legal
ways, to obtain all such benefits to which Indemnitee is entitled.

         7.       Liability Insurance. The rights of the Indemnitee hereunder
shall also be in addition to any other rights Indemnitee may now or hereafter
have under policies of insurance maintained by the Company or otherwise. To the
extent the Company maintains an insurance policy or policies providing
directors' and officers' liability insurance, Indemnitee shall be covered by
such policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director, officer or
representative. The parties hereby acknowledge that the Company presently
maintains an aggregate of $100 million of directors' and officers' liability
insurance.

         The Company shall maintain insurance coverage in the amount of the
present policy limits and with the present scope of coverage for so long as
Indemnitee's services are covered hereunder, provided and to the extent that
such insurance is available on a basis acceptable to the Company. In the event
that such insurance becomes unavailable in the amount of the present policy
limits or in the present scope of coverage at premium costs and on other terms
acceptable to the Company, then the Company may forego maintenance of all or a
portion of such insurance coverage. However, in the event of any reduction in
(or cancellation of) such insurance coverage (whether voluntary or involuntary),
the Company shall, and hereby agrees to, stand as a self-insurer with respect to
the coverage, or portion thereof, not retained, and shall indemnify the
Indemnitee against any loss arising out of the reduction in or cancellation of
such insurance coverage.

         8.       Escrow Fund. As collateral security for its obligations
hereunder (including specifically its indemnity obligations (other than
Judgments) and other obligations pursuant to Sections 2, 6 and 7) and under
similar agreements with other directors, officers and representatives, in the
event of a Change in Control, the Company shall dedicate and maintain, for a
period of five years following the Change of Control, an escrow account in the
aggregate of TEN MILLION DOLLARS ($10,000,000) by depositing assets or bank
letters of credit in escrow or reserving lines of credit that may be drawn down
by an escrow agent in said amount (the "Escrow Reserve"). The Company shall
promptly following establishment of the Escrow Reserve provide Indemnitee with a
true and complete copy of the agreement relating to the establishment and
operation of the Escrow Reserve, together with such additional documentation or
information with respect to the Escrow Reserve as Indemnitee may from time to
time reasonably request. The Company shall promptly following establishment of
the Escrow Reserve deliver an executed copy of this Agreement to the escrow
agent for the Escrow Reserve to evidence to that agent that Indemnitee is a
beneficiary of

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that Escrow Reserve and shall deliver to Indemnitee the escrow agent's signed
receipt evidencing that delivery.

         9.       Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of the Company or any
affiliate of the Company against Indemnitee, Indemnitee's spouse, heirs,
executors or personal or legal representatives after the expiration of two years
from the date of accrual of such cause of action, and any claim or cause of
action of the Company or its affiliate shall be extinguished and deemed released
unless asserted by the timely filing of legal action within such two-year
period; provided, however, that if any shorter period of limitations is
otherwise applicable to any such cause of action such shorter period shall
govern.

         10.      Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both of the
parties hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions thereof (whether or
not similar) nor shall such waiver constitute a continuing waiver.

         11.      Subrogation. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee, who shall execute all papers required and shall do
everything that may be necessary to secure such rights, including the execution
of such documents necessary to enable the Company effectively to bring suit to
enforce such rights.

         12.      No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any Claim made
against Indemnitee to the extent Indemnitee has otherwise actually received
payment (under any insurance policy, article or otherwise) of the amounts
otherwise indemnifiable hereunder.

         13.      Binding Effect, Etc. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns, including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business and/or assets of the Company, spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as a director, officer or representative of the
Company or of any other enterprise at the Company's request.

         14.      Severability. The provisions of this Agreement shall be
severable in the event that any of the provisions hereof (including any
provision within a single section, paragraph or sentence) are held by a court of
competent jurisdiction to be invalid, void or otherwise unenforceable, and the
remaining provisions shall remain enforceable to the fullest extent permitted by
law.

         15.      Termination of Cooper Ohio Indemnification Agreement. As of
the effective date of this Agreement, Indemnitee and the Company agree that the
Indemnification Agreement between Indeminitee and Cooper Ohio is terminated and
replaced with this Agreement.

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         16.      Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of Bermuda applicable to
contracts made and to be performed in Bermuda without giving effect to the
principles of conflicts of laws. For purposes of this Agreement, the Company
submits to the non-exclusive jurisdiction of state and federal courts sitting in
the city of Houston, Texas.

         Executed and effective as of this ______ day of _____________, 2003.

                             COOPER INDUSTRIES, LTD.

                             By: ________________________________________

                                 Name:  H. John Riley, Jr.
                                 Title: Chairman, President and Chief Executive
                                        Officer

                             INDEMNITEE:

                             By: _______________________________________

                                 Name: _________________________________

                                 Title: ________________________________

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                                                                   EXHIBIT 10.25

                     RULES OF THE COOPER (UK 2002) EMPLOYEE

                               SHARE PURCHASE PLAN

                  ____________________________________________
                             (Adopted by the Company

                                on August 6, 2002

                      and approved by the Inland Revenue on

                  ____________________________________________

                      under Reference ___________________)

                  ____________________________________________

<PAGE>

                                    CONTENTS
<TABLE>
<S>                                                                       <C>
1.  INTRODUCTION......................................................    1

2.  NAME..............................................................    1

3.  DEFINITIONS.......................................................    1

4.  INDIVIDUAL SAVINGS LIMITS.........................................    6

5.  EXERCISE PRICE....................................................    6

6.  INVITATIONS AND APPLICATIONS FOR OPTIONS..........................    7

7.  GRANT OF OPTIONS AND SCALING-DOWN.................................    8

8.  RESTRICTIONS ON TRANSFER OF OPTIONS...............................   10

9.  EXERCISE OF OPTIONS...............................................   10

10. MANNER OF EXERCISE OF OPTIONS.....................................   12

11. MERGER, SALE, CHANGE OF CONTROL AND LIQUIDATION...................   13

12. ROLLOVER OF OPTIONS...............................................   14

13. VARIATION OF CAPITAL..............................................   16

14. AVAILABILITY OF AUTHORISED CAPITAL................................   16

15. VARIATION AND TERMINATION OF PLAN.................................   17

16. ADMINISTRATION....................................................   17

17. GENERAL...........................................................   18

18. GOVERNING LAW.....................................................   19

19. HEADINGS..........................................................   19
</TABLE>

<PAGE>

                     RULES OF THE COOPER (UK 2002) EMPLOYEE

                               SHARE PURCHASE PLAN

1.       INTRODUCTION

         The Cooper (UK 2002) Employee Share Purchase Plan ("Plan") is designed
         to provide UK employees of Cooper Industries Ltd ("Company") and its
         subsidiaries with the opportunity to acquire common shares of the
         Company, by granting options to such employees on such dates not later
         than ten years following the Date of Approval (as defined below) as the
         Board (as defined below) may from time to time determine. The Plan is
         intended to constitute a "save as you earn" share option scheme within
         the provisions of Schedule 9 of the Income and Corporation Taxes Act
         1988.

2.       NAME

         This Plan shall be known as the "Cooper (UK 2002) Employee Share
         Purchase Plan".

3.       DEFINITIONS

         3.1      Except where inconsistent with the context the following words
                  and expressions shall have the Following meanings:-

                  "ACTUAL CONVERTED AGGREGATE AMOUNT" means the Actual Sterling
                  Aggregate Amount converted into United States dollars using
                  the spot exchange rate of Barclays Bank Plc at noon GMT on the
                  date of exercise of an Option;

                  "ACTUAL STERLING AGGREGATE AMOUNT" means for each Eligible
                  Employee the total amount in pounds sterling saved by that
                  Eligible Employee under a Savings Contract together with any
                  Bonus due under that Savings Contract;

                  "ASSOCIATED COMPANY" shall, for the purposes of Rule 9.3.6
                  have the meaning given to that expression in paragraph 23 of
                  Schedule 9 by virtue of Section 187(2) of the Taxes Act and,
                  for any other part of these Rules, "Associated Company" shall
                  have the meaning given to that expression in section 416 Taxes
                  Act;

                  "AUDITORS" means the auditors of the Company for the time
                  being;

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                  "BOARD" means:

                  1.       the board of directors of the Company for the time
                           being; or

                  2.       as appropriate a committee which has been duly
                           authorised by the board of directors of the Company
                           pursuant to Rule 16;

                  "BONUS" means:

                  1.       the First Bonus, or

                  2.       the Standard Bonus, or

                  3.       the Maximum Bonus as appropriate in relation to any
                           particular savings contract;

                  "BONUS DATE" means in relation to any Savings Contract the
                  earliest date on which a Bonus is payable;

                  "CESSATION OF EMPLOYMENT" means the date on which an Option
                  Holder ceased to be employed within the Group and for this
                  purpose "Group" shall include any Associated Company;

                  "CONTROL" means control as defined in section 840 of the Taxes
                  Act;

                  "DATE OF APPROVAL" means the date on which the Plan is
                  approved by the Inland Revenue pursuant to Schedule 9;

                  "ELIGIBLE EMPLOYEE" means:

                  1.       an employee of the Group, or

                  2.       a director of the Company and/or of any Subsidiary
                           who is contracted to work full-time (and in any event
                           for not less than 25 hours per week exclusive of meal
                           breaks) for the Company and/or any of the
                           Subsidiaries,

                  who either has been such an employee or director continuously
                  since 1 January in the calendar year in which the Date of
                  Grant falls, and is chargeable to tax in respect of his office
                  or employment under Case 1 of Schedule E (as set out in
                  section 19 of the Taxes Act), or is any other employee of the
                  Group who is permitted by the Board to

                                                                               2
<PAGE>

                  participate in the Plan, and is not precluded from
                  participating in the Plan by paragraph 8 of Schedule 9;

                  " EMPLOYEE TRUST" means any one or more trusts established by
                  the Company or any of its Subsidiaries under the terms of
                  which any one or more Eligible Employees may obtain benefit;

                  "ESTIMATED STERLING AGGREGATE AMOUNT" means for each Eligible
                  Employee an estimate of the Actual Sterling Aggregate Amount,
                  such estimate being based on the assumption that the Eligible
                  Employee continues to contribute fully to his Savings Contract
                  for the full term of the Savings Contract.

                  "ESTIMATED CONVERTED AGGREGATE AMOUNT" means the Estimated
                  Sterling Aggregate Amount converted into United States dollars
                  using the spot exchange rate of Barclays Bank Plc at noon GMT
                  on the Date of Grant;

                  "EXERCISE PRICE" means the amount per Share payable on the
                  exercise of an Option;

                  "FIRST BONUS" means the bonus payable following the making of
                  thirty six monthly (or the appropriate number of weekly)
                  payments pursuant to a 3 year Savings Contract;

                  "GMT" means Greenwich Mean Time;

                  "GRANT" means a resolution by the Board (or an action by a
                  person duly authorised by the Board) as a consequence of which
                  the Board has granted Options over that number of Shares which
                  is to be, and to those Eligible Employees which are to be,
                  determined in accordance with Rules 6 and 7 and the "DATE OF
                  GRANT" shall mean the date on which the resolution is passed
                  or the action is taken as appropriate.

                  "GROUP" means the Company and all its Subsidiaries for the
                  time being or, where appropriate, any Jointly-Owned Company
                  which has been approved by the board of Inland Revenue to
                  participate in the Plan (and/or any Subsidiary for the time
                  being of such Jointly-Owned Company) in each case whether
                  incorporated in the United Kingdom or elsewhere and which is
                  nominated by the Board to participate in the Plan;

                  "INVITATION" means the invitation sent to all Eligible
                  Employees pursuant to the provisions of Rule 6 which invites
                  the addressee to participate in the Plan.

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<PAGE>

                  "JOINTLY-OWNED COMPANY" means any company which is jointly
                  owned by the Company (whether directly or indirectly) and one
                  other person (that is, controlled as to 50% by each of those
                  two persons);

                  "MARKET VALUE" means

                  1.       on any day the market value of a Share determined in
                           accordance with the provisions of Part VIII of the
                           Taxation of Chargeable Gains Act 1992 and agreed in
                           advance for the purposes of the Plan with the Inland
                           Revenue Shares Valuation Division; or

                  2.       on any day if at the relevant time shares of the same
                           class as the Shares are fully quoted on the New York
                           Stock Exchange, the average of the high and low
                           market quotation of shares of that class for the
                           preceding trading day;

                  "MAXIMUM BONUS" means the bonus payable pursuant to a 5 year
                  Savings Contract two years after an entitlement to a Standard
                  Bonus would accrue where the Eligible Employee has made the
                  appropriate election for a Maximum Bonus;

                  "OPTION" means a right to acquire Shares in the capital of the
                  Company granted pursuant to the Plan;

                  "OPTION CERTIFICATE" means a certificate evidencing the Option
                  as referred to in Rule 7.8;

                  "OPTION HOLDER" means a person who holds an Option or where
                  the context so permits the legal personal representative of
                  such person;

                  "PLAN" means the Cooper (UK 2002) Employee Share Purchase Plan
                  established by these Rules subject to any amendments made in
                  accordance with their terms;

                  "RULES" means these rules as amended from time to time;

                  "SAVINGS CONTRACT" means a contract under a certified
                  contractual savings scheme (within the meaning of Section 326
                  Taxes Act) entered into with a bank or building society
                  nominated by the Board and which has been approved for the
                  purpose of Schedule 9 by the Inland Revenue;

                  "SCHEDULE 9" means Schedule 9 to the Taxes Act;

                                                                               4
<PAGE>

                  "SHARES" means Class A common shares of the Company which
                  comply with the requirements of paragraphs 10 to 14 inclusive
                  of Schedule 9;

                  "SPECIFIED AGE" means:

                  1.       sixty five years, or

                  2.       any other age determined by the Board from time to
                           time provided that any other age determined by the
                           Board shall not be less than sixty years and not more
                           than seventy five years and any such determination
                           shall not be effective until the amendment has been
                           approved by the board of the Inland Revenue;

                  "STANDARD BONUS" means the bonus payable following the making
                  of sixty monthly or the appropriate number of weekly payments
                  pursuant to a 5 year Savings Contract;

                  "SUBSIDIARY" means a company which is under the Control of the
                  Company (or any Jointly-Owned Company, as the case may be) and
                  is a subsidiary of it within the meaning of Section 736 of the
                  Companies Act 1985;

                  "SUBSISTING OPTION" means an Option which has neither lapsed
                  nor been exercised;

                  "TAXES ACT" means the Income and Corporation Taxes Act 1988;

                  "TOTAL EXERCISE COST" means the total amount payable for
                  Shares, expressed as an amount in United States dollars, which
                  may be or are issued or transferred on the exercise of an
                  Option;

                  "TRUSTEES" means the trustees for the time being of the
                  Employee Trust as approved by the Board.

         3.2      Words importing the singular shall include the plural and vice
                  versa and words importing the masculine shall include the
                  feminine.

         3.3      References to a statute or to any part or parts thereof shall
                  include references to the same as from time to time amended or
                  re-enacted.

         3.4      Except where inconsistent with the context and unless
                  otherwise stated any words or expressions used herein shall
                  have the same meanings as in schedule 9.

                                                                               5
<PAGE>

4.       INDIVIDUAL SAVINGS LIMITS

         4.1      Following any particular invitation to participate in the plan
                  an eligible employee may apply for the grant of an option
                  provided that:-

                  4.1.1    the minimum contributions payable under the Savings
                           Contract to be entered into in respect of such grant
                           shall not be less than (pound)5 per month nor greater
                           than the amount per month specified from time to time
                           in paragraph 24(2)(b) of Schedule 9; and

                  4.1.2    the contribution payable in any month by the Eligible
                           Employee under the Savings Contract to be entered
                           into in respect of such grant when added to the
                           contributions payable under all other subsisting
                           Savings Contracts or savings contracts approved or
                           treated as approved by the Inland Revenue for savings
                           related share option schemes approved by the Inland
                           Revenue for the purposes of Schedule 9, shall not
                           exceed the greater of (pound)250 or the maximum
                           amount permitted by Schedule 9 or if less, such other
                           maximum amount specified by the Board or the Trustees
                           in its/their absolute discretion by reference to any
                           particular invitation.

5.       EXERCISE PRICE

         The Exercise Price for an Option shall be determined on the Date of
         Grant subject to the following:-

         5.1      In the case of an option to acquire one or more shares the
                  exercise price shall be 85% of the market value of a share (or
                  such higher percentage as may from time to time be permitted
                  by The taxes act); and

         5.2      In the case of an option to subscribe for one or more shares
                  the exercise price shall be the greater of the nominal value
                  and 85% of the market value of a share (or such higher
                  percentage as may from time to time be permitted by the taxes
                  act).

         5.3      The exercise price for an option shall be stated in united
                  states dollars.

         5.4      Subject to rule 7.5 Options must be granted no more than 30
                  days after the day on which the market value is determined.

                                                                               6
<PAGE>

6.       INVITATIONS AND APPLICATIONS FOR OPTIONS

         6.1      Subject to any requirements limits or restrictions contained
                  elsewhere in the rules the board and/or the trustees may in
                  its/their absolute discretion issue invitations to all persons
                  who are eligible employees.

         6.2      The board (or in circumstances where options are to be granted
                  by the trustees, the trustees in consultation with the board);

                  6.2.1    shall have determined the maximum number of Shares
                           over which Options have been granted on the Date of
                           Grant; and

                  6.2.2    may have at that time determined a higher number to
                           which such maximum may be increased if and only if
                           the need for scaling down under Rule 7.5 will be
                           thereby avoided

                  subject in all events to the limit on the aggregate number of
                  Shares that may be issued under the Plan as set out in Rule
                  14.1.

         6.3      Invitations shall include an application form, (in a form
                  determined by the board or trustees, as appropriate) together
                  with instructions for the completion and return of the
                  application in accordance with rule 6.4.

         6.4      Invitations shall state whether the savings contracts to be
                  entered into in relation to the particular grant shall include
                  any one or more of:-

                  6.4.1    the First Bonus;

                  6.4.2    the Standard Bonus;

                  6.4.3    the Maximum Bonus;

                  and if appropriate must invite Eligible Employees to select
                  which Savings Contract they wish to enter into and to indicate
                  their selection on the application form.

         6.5      Not later than the date specified in the invitation (being
                  neither earlier than fourteen nor later than twenty-one days
                  after the date of grant, unless on a particular occasion the
                  inland revenue has agreed to a variation in the time allowed
                  for the response to invitations) each eligible employee to
                  whom an invitation has been issued may

                                                                               7
<PAGE>

                  return the application form provided pursuant to rule 6.3 To
                  the board or the trustees (as the case may be) thereby
                  indicating that he wishes to be granted an option.

         6.6      Subject to rule 7 below, applications shall be taken to be for
                  an option over shares with a total exercise cost as near as
                  possible to but not exceeding the estimated converted
                  aggregate amount.

7.       GRANT OF OPTIONS AND SCALING-DOWN

         7.1      Subject to this rule 7 the option shall be over the number of
                  shares for which application is made.

         7.2      Not later than the twenty-eighth day following the issue of
                  invitations the board (on behalf of the company) and/or the
                  trustees (as the case may be) shall confirm to each applicant
                  who is still an eligible employee that an option has been
                  granted to that eligible employee and indicating the maximum
                  number of shares over which the option has been granted.

         7.3      Where any option has been granted by the board and the terms
                  specified in the option provide for the satisfaction of the
                  option by the issue of shares by the company then the board
                  may in its absolute discretion determine that in substitution
                  for the allotment and issue of shares it shall procure that
                  some or all of the shares over which the option subsists shall
                  be satisfied, in accordance with rule 14.2, By some other
                  person or body. Such determination may be made at any time
                  following the grant of any particular option and prior to the
                  resolution of the board to satisfy the exercise of any option
                  by the issue of share.

         7.4      Options may be granted pursuant to the plan as follows:-

                  7.4.1    By the Board where such Option will, subject to Rule
                           14.2 below, be satisfied on its exercise by the
                           Company issuing Shares to the relevant Option Holder;

                  7.4.2    By the Board, where such Option will be satisfied on
                           its exercise by some other person or body (including,
                           without limitation, the Trustees);

                  7.4.3    By the Trustees where such Option on its exercise
                           will be satisfied by the transfer of Shares from the
                           Employee Trust.

                                                                               8
<PAGE>

         7.5      If the board and/or the trustees receive completed application
                  forms which indicate that the maximum number of shares over
                  which options have been granted on the date of grant is
                  insufficient after taking into account any higher number of
                  shares over which options have been granted pursuant to rule
                  6.2 Then reference to the fortieth day shall be substituted
                  for reference to the twenty-eighth day in rule 7.2 And the
                  following steps shall be carried out successively to the
                  extent necessary to eliminate the excess:-

                  7.5.1    each election for the Maximum Bonus to be included in
                           the repayment under the Savings Contract shall be
                           deemed to be an election for only the Standard Bonus
                           to be so included;

                  7.5.2    each election for the Standard Bonus or the First
                           Bonus to be included in the repayment under the
                           Savings Contract shall be deemed to be an election
                           for no bonus to be so included;

                  7.5.3    the excess over the minimum monthly savings
                           contribution chosen by each applicant in relation to
                           that particular grant shall be reduced pro rata to
                           the extent necessary;

                  7.5.4    each election for a 5 year Savings Contract shall be
                           deemed to be an election for only a 3 year Savings
                           Contract;

                  7.5.5    subject to Rule 7.6, applications will be selected by
                           lot each based on a monthly savings contribution of
                           (pound)5 and the inclusion of no bonus in the
                           repayment under the Savings Contract.

         Each application shall be deemed to have been modified or withdrawn in
         accordance with the application of the foregoing provisions and the
         Board shall amend each Savings Contract proposal form to reflect any
         reduction in monthly savings contributions resulting from such
         application.

         7.6      As an alternative to selecting applications by lot, the board
                  and/or the trustees may determine in its/their absolute
                  discretion that no options shall be granted.

         7.7      For the avoidance of doubt, the grant of an option to an
                  eligible employee shall be conditional upon the eligible
                  employee having entered into a savings contract such that the
                  estimated converted aggregate amount will be not less than the
                  total exercise cost of the shares over which the option is
                  granted.

                                                                               9
<PAGE>

         7.8      The grant of an option shall be evidenced by the issue of a
                  certificate under the authority of the board or the trustees
                  as appropriate in such form as the board and/or the trustees
                  may determine and which shall specify:-

                  7.8.1    the Exercise Price;

                  7.8.2    the maximum number of Shares over which the Option is
                           granted based on the Barclays Bank plc
                           dollar/sterling spot exchange rate at noon on the
                           Date of Grant;

                  7.8.3    the Date of Grant; and

                  7.8.4    a statement to the effect that the actual number of
                           Shares over which the Eligible Employee shall be able
                           to exercise an Option shall be determined on the date
                           of exercise of the Option (or as soon after that date
                           as is practicable) according to the dollar/sterling
                           spot exchange rate of Barclays Bank plc at noon GMT
                           on the date of exercise of the Option.

         7.9      If any certificate shall be destroyed, lost, defaced or worn
                  out, it may be renewed on such evidence being provided and on
                  such terms as the board or trustees may require.

         7.10     No option may be granted later than 10 years after the date of
                  approval.

8.       RESTRICTIONS ON TRANSFER OF OPTIONS

         An Option shall be personal to the Option Holder (or, where
         appropriate, his legal personal representatives) and shall not be
         assignable. Any purported assignment transfer, charge, disposal or
         dealing with the rights and interests of the Option Holder shall render
         the Option void.

9.       EXERCISE OF OPTIONS

         9.1      Subject to any provision in these rules to the contrary an
                  option shall:-

                  9.1.1    become exercisable on the Bonus Date; and

                  9.1.2    lapse six months after the Bonus Date.

                                                                              10
<PAGE>

         9.2      The maximum number of shares over which an option shall be
                  exercisable shall be determined using the exercise price and
                  the actual converted aggregate amount.

         9.3      No option shall be exercisable over a number of shares to the
                  extent that the total exercise cost exceeds the actual
                  converted aggregate amount and, for the purposes of this rule,
                  the actual converted aggregate amount excludes the repayment
                  of any contribution the due date for payment of which falls
                  more than one month after the date on which repayment under
                  the savings contract is made.

         9.4      An option may be exercised by an option holder in the
                  circumstances and within the periods specified below and
                  (except as set out in rule 9.4.4 Below) shall thereafter
                  lapse:-

                  9.4.1    if the Option Holder dies before the Bonus Date, the
                           period of twelve months after his death;

                  9.4.2    if the Option Holder dies in the six months following
                           the Bonus Date the period of twelve months after the
                           Bonus Date;

                  9.4.3    unless the Option Holder has died, and subject to
                           Rules 9.3 and 9.4.1, the period of six months
                           following Cessation of Employment by reason of injury
                           disability redundancy within the meaning of the
                           Employment Rights Act 1996 or retirement on reaching
                           an age not less than either the age at which he is
                           bound to retire in accordance with the terms of his
                           contract of employment or the Specified Age;

                  9.4.4    subject to Rules 9.3 and 9.1.2 the period of six
                           months after the Option Holder reaches the Specified
                           Age if he continues to be employed within the Group
                           after reaching such Specified Age;

                  9.4.5    unless the Option Holder had died, and subject to
                           Rules 9.3 and 9.1.2, the period of six months
                           following Cessation of Employment (other than for
                           reasons of dismissal for misconduct, by reason of
                           early retirement or voluntary redundancy) in
                           circumstances in which Rules 9.4.1, 9.4.2 and 9.4.3
                           do not apply provided that on such Cessation of
                           Employment at least three years have elapsed since
                           the Date of Grant;

                  9.4.6    subject to Rules 9.3 and 9.1.2 the period of six
                           months following Cessation of Employment by reason of
                           the Company by which he is employed ceasing

                                                                              11
<PAGE>

                           to be a member of the Group or by reason of the sale
                           of the undertaking in which he is employed to a
                           transferee which is neither a member of the Group nor
                           an Associated Company; and

                  9.4.7    the events specified in Rule 11.

         9.5      Subject to rule 9.1.2 An option shall lapse if:

                  9.5.1    the Option Holder ceases to be employed within the
                           Group for any reason other than as set out in Rule
                           9.4 hereof provided that an Option Holder who ceased
                           to be an Eligible Employee by reason of pregnancy or
                           confinement and who exercises her right to return to
                           work under Section 45 of the Employment Protection
                           (Consolidation) Act 1978 before exercising an Option
                           under the Plan will be treated for these purposes as
                           not having ceased to be an Eligible Employee; or

                  9.5.2    the whole or part of an Option Holder's contributions
                           under the related Savings Contract are repaid to the
                           Option Holder before the earliest date on which the
                           Option may be exercised in accordance with this Plan;
                           or

                  9.5.3    the Option Holder is adjudicated bankrupt.

         9.6      No option may be exercised when:

                  9.6.1    the Option Holder is; or

                  9.6.2    the personal representative(s) of an Option Holder
                           who at the date of his death is or are,

                  precluded from participating in the Plan by paragraph 8 of the
                  Schedule 9. In addition and (subject to Rules 9.4.1, 9.4.2,
                  9.4.3, 9.4.5 and 9.4.6) no Option may be exercised by an
                  Option Holder when he is not an Eligible Employee.

10.      MANNER OF EXERCISE OF OPTIONS

         10.1     In order to exercise an option the option holder or his legal
                  personal representative shall terminate the related savings
                  contract and deliver to the secretary of the company (or his
                  designee) or the trustees as appropriate his option
                  certificate together with a written notice signed by or on
                  behalf of the option holder and

                                                                              12
<PAGE>

                  specifying the number of shares in respect of which the option
                  is being exercised and payment in full of the exercise price
                  in united states dollars for those shares.

         10.2     An option may be exercised on one occasion only in respect of
                  all or any of the shares over which it is granted.

         10.3     If the actual converted aggregate amount exceeds the total
                  exercise cost, the option holder shall receive a cash refund
                  to the extent that the actual converted aggregate amount
                  exceeds the total exercise cost.

         10.4     If the actual converted aggregate amount is less than the
                  total exercise cost, the number of shares that the option
                  holder may purchase upon exercise of the option shall be
                  limited to the number of shares that can be purchased at the
                  exercise price using the actual converted aggregate amount.

         10.5     All allotments, issues and transfers of shares shall be made
                  on such day or days as the board or the trustees may determine
                  and shall be made to the option holder (or at the absolute
                  discretion of the board or the trustees (as appropriate), to
                  one or more nominee or nominees including, for the avoidance
                  of doubt, to the administrators of any tax efficient equity
                  ownership plan nominated by the option holder) within 30 days
                  of the exercise of the relevant option subject however to any
                  necessary consents under any relevant enactments or
                  regulations for the time being in force having been obtained
                  (and it shall be the responsibility of the option holder to
                  comply with any requirements to be fulfilled in order to
                  obtain or obviate the necessity for any such consent).

         10.6     If a dividend or other distribution is to be or is proposed to
                  be paid to holders of the shares on the register on a date
                  prior to the date of exercise of an option the shares to be
                  issued or transferred upon such exercise will not rank for
                  such dividend or other distribution. Subject to the foregoing
                  shares allotted or transferred upon the exercise of an option
                  shall rank pari passu in all respects with the shares in issue
                  on the date of such exercise

11.      MERGER, SALE, CHANGE OF CONTROL AND LIQUIDATION

         11.1     If any person obtains control of the company as a result of
                  making:-

                                                                              13
<PAGE>

                  11.1.1   a general offer to acquire the whole of the issued
                           share capital of the Company which is made on a
                           condition such that if it is satisfied the person
                           making the offer will have Control of the Company; or

                  11.1.2   a general offer to acquire all of the shares in the
                           Company which are of the same class as the Shares;

                  any Subsisting Option held by an Option Holder may be
                  exercised (subject to Rule 13.1 below and to Rules 9.3 and
                  9.1.2 above) within six months of the time when the person
                  making the offer has obtained Control of the Company and any
                  condition subject to which the offer is made has been
                  satisfied (unless the Inland Revenue has agreed to a reduction
                  in the time allowed for the exercise of Subsisting Options)
                  and if not so exercised shall then lapse unless Rule 12 below
                  applies.

         11.2     If as a result of the events specified in rules 11.1 A person
                  has obtained control of the company and, in accordance with
                  the provisions of that rule, the option holder has exercised
                  any subsisting option the company shall use its reasonable
                  endeavours to procure that following the transfer or allotment
                  (as the case may be) of shares to the option holder, inasmuch
                  as such shares were not previously included in the general
                  offer, the relevant party shall offer to acquire such shares
                  from the option holder upon the same terms as those upon which
                  the shares were originally acquired under the general offer.

         11.3     If notice is duly given of a resolution for the voluntary
                  winding-up of the company (other than for the purpose of
                  reconstruction or amalgamation) an option holder may (subject
                  to rules 9.3 And 9.1.2) During the six months thereafter
                  exercise all or any of his subsisting options (but so that
                  such exercise shall be conditional upon the passing of such
                  resolution before the expiry of six months after the bonus
                  date) which shall then lapse.

12.      ROLLOVER OF OPTIONS

         12.1     If a company (in this rule called the "acquiring company") has
                  acquired control of the company as a result of any of the
                  events described in rules 11.1.1 Or 11.1.2 (Such acquiring of
                  control being referred to below as a "relevant event"), the
                  option holder may by agreement with the acquiring company at
                  any time within the appropriate period (as defined in rule
                  12.3 Below) release his rights under the plan (in this rule
                  referred to as the "old rights") in consideration of the grant
                  to him of

                                                                              14
<PAGE>

                  rights (in this rule referred to as the "new rights") which
                  comply with paragraph 12.2 Below and relate to shares in the
                  acquiring company (or some other company which in relation to
                  the acquiring company falls within paragraph (b) or paragraph
                  (c) of paragraph 10 of schedule 9).

         12.2     The new rights shall comply with each of the following
                  requirements:

                  12.2.1   the shares to which they relate shall satisfy the
                           conditions specified in relation to plan shares in
                           paragraphs 10 to 14 of Schedule 9;

                  12.2.2   the New Rights shall be exercisable in the same
                           manner as the Old Rights and subject to the
                           provisions of the Plan as it had effect immediately
                           before the release of the Old Rights;

                  12.2.3   the total Market Value, immediately before the
                           release, of the Shares which were subject to the
                           Option Holder's Old Rights shall be equal to the
                           total Market Value immediately after the grant of the
                           shares in respect of which the New Rights are granted
                           to the Option Holder; and

                  12.2.4   the total amount payable by the Option Holder for the
                           acquisition of shares in pursuance of the New Rights
                           shall be equal to the total amount that would have
                           been payable for the acquisition of Shares in
                           pursuance of the Old Rights.

         12.3     In this rule the "appropriate period" means the period of six
                  months beginning with the time when the person making the
                  offer has obtained control of the company and any condition
                  subject to which the offer is made is satisfied;

         12.4     Any reference in rules 8 to 13 and rules 15 and 16 to
                  "option", "shares", "company" or "board" shall, in its
                  application to any new rights, be deemed a reference to the
                  new rights, the shares to which the new rights relate, the
                  company in whose capital such shares are comprised or the
                  board as defined in rule 1 but in relation to the acquiring
                  company.

         12.5     Rule 12.1 Above is included in the plan by virtue of paragraph
                  15 of schedule 9.

         12.6     If new rights shall be granted to an option holder by
                  reference to any relevant event, rule 11.1 Above shall cease
                  to apply by reference to that relevant event (but without
                  prejudice to their application by reference to any other
                  relevant event). Any

                                                                              15
<PAGE>

                  option which is not exercised or released pursuant to this
                  rule within the appropriate period (as defined in rule 12.3
                  Above) following a relevant event (but not any new rights
                  granted by reference to that relevant event) shall lapse.

13.      VARIATION OF CAPITAL

         13.1     The aggregate number of shares which may be issued under the
                  plan may be increased to reflect a change in capitalisation of
                  the company, such as a stock dividend or stock split.

         13.2     If, prior to the expiration of an option, the company shall
                  effect a subdivision or consolidation of its shares or the
                  payment of a stock dividend on its shares without receipt of
                  consideration by the company, the number of shares thereafter
                  subject to such option (i) in the event of an increase in the
                  number of outstanding shares shall be proportionately
                  increased, and the exercise price shall be proportionately
                  reduced, and (ii) in the event of a reduction in the number of
                  outstanding shares shall be proportionately reduced, and the
                  exercise price shall be proportionately increased.

         13.3     No adjustments shall be made without specific prior approval
                  of the inland revenue.

         13.4     Notice of any such adjustments shall be given to the option
                  holders who if required shall return their option certificates
                  for endorsement or replacement

14.      AVAILABILITY OF AUTHORISED CAPITAL

         14.1     The aggregate number of shares that may be issued (a) pursuant
                  the plan, (b) and pursuant to the company's obligations as
                  successor to cooper industries, inc. Under the cooper (uk)
                  share purchase plan approved by the cooper industries, inc.
                  Board of directors on february 9, 2000, is 500,000 authorised
                  but unissued shares.

         14.2     The company has made application to the new york stock
                  exchange in respect of the maximum number of shares issuable
                  under the plan and shall submit such returns or reports as may
                  be required by the exchange concerning the number of shares
                  actually allotted under the plan.

         14.3     The company shall keep available sufficient authorised but
                  unissued shares to satisfy in full all outstanding options
                  granted by the company to subscribe for shares and ensure that
                  there are sufficient shares in issue available to satisfy any
                  subsisting option to acquire shares.

                                                                              16
<PAGE>

         14.4     At any time following the grant of an option by the company
                  the company may elect to satisfy its obligation to issue
                  shares arising from such exercise by procuring the transfer by
                  the trustees or any other existing shareholder or shareholders
                  to the option holder of the number of issued shares equal to
                  the number of shares in respect of which the option is
                  exercised and at a price equal to the exercise price and
                  otherwise on terms no less favourable (mutatis mutandis) to
                  the option holder than those which would have applied had the
                  company not made such election.

15.      VARIATION AND TERMINATION OF PLAN

         15.1     These rules may be altered by resolution of the board in any
                  manner and at any time subject to the following provisions:

                  15.1.1   in making such alteration, the Board shall have
                           regard to the fact that, if such an alteration is
                           made at a time when the Plan is approved by the
                           Inland Revenue under Schedule 9, the approval shall
                           not have effect until approved by the Inland Revenue
                           and approval shall therefore be sought from the
                           Inland Revenue as soon as possible following the
                           making of any alteration; and

                  15.1.2   no alteration may materially affect an Option Holder
                           as regards an Option granted prior to the alteration
                           being made save that this shall not prevent the issue
                           of Options after the date of the alteration on terms
                           more favourable than those Options granted prior to
                           that date.

                  15.13    The Company may by ordinary resolution of the Board
                           at any time resolve to terminate the Plan in which
                           case no further Options shall be granted but the
                           Subsisting Options shall not be affected by such
                           termination.

16.      ADMINISTRATION

         16.1     The plan shall be administered by the plan administration
                  committee established by the board, which committee shall be
                  authorised to approve offerings under the plan and to
                  interpret the plan and from time to time to adopt such rules
                  and regulations, consistent with the provisions of the plan,
                  as may be deemed advisable to carry out the plan. The decision
                  of such committee shall be final and binding for all purposes
                  with respect to any question arising under the plan.

         16.2     The committee is authorised to amend the plan to benefit the
                  administration of the plan and make amendments to bring the
                  plan within the terms of schedule 9 and/or to

                                                                              17
<PAGE>

                  obtain or maintain inland revenue approval under the
                  provisions of schedule 9 or any other enactment and/or to take
                  advantage of or to comply with any changes in existing or
                  proposed legislation or to obtain or maintain favourable
                  taxation, exchange control or regulatory treatment of the
                  company, any subsidiary or option holder.

17.      GENERAL

         17.1     In the event of any dispute or question concerning the
                  construction or effect of the plan the decision of the board
                  shall be final and conclusive subject to the concurrence of
                  the auditors wherever required under these rules.

         17.2     In any matter in which they are required to act under the plan
                  the auditors shall be deemed to be acting as experts and not
                  as arbitrators and the arbitration acts 1950 to 1996 shall not
                  apply hereto.

         17.3     Notwithstanding any provisions of any other of these rules the
                  plan shall not form part of any contract of employment of any
                  eligible employee and shall not confer any legal or equitable
                  rights (other than those constituting the options themselves)
                  against the company or any subsidiary nor shall the benefits
                  to eligible employees under the plan form any part of their
                  remuneration for pension or other purposes.

         17.4     Ifan option holder shall cease for any reason to be an
                  eligible employee his rights and benefits under the plan or in
                  connection therewith (actual or prospective) or any loss
                  thereof shall not entitle him to any claim for compensation
                  against the company or any subsidiary.

         17.5     If a person shall cease to be an eligible employee for
                  whatever reason he shall not be entitled to compensation for
                  any loss of any rights or benefits (actual or prospective)
                  under the plan which he might otherwise have enjoyed whether
                  such compensation is claimed by way of damages for unfair
                  dismissal, wrongful dismissal or other breach of contract or
                  by way of compensation for loss of office or otherwise.

         17.6     The board may from time to time make and vary such regulations
                  (not being inconsistent with the plan) for the implementation
                  and administration of the plan as it thinks fit.

         17.7     Option holders shall not be entitled to copies of notices and
                  documents sent to ordinary shareholders prior to the exercise
                  of an option.

                                                                              18
<PAGE>

         17.8     It shall be the duty of the board or the trustees (as
                  appropriate) to provide returns of any options granted or
                  exercised and to make available such further information as
                  may be requested from time to time by the board of the inland
                  revenue.

         17.9     Any notice or other communication under or in connection with
                  the plan may be given by personal delivery or by sending the
                  same by post, in the case of a company to its registered
                  office and in the case of an individual to his last known
                  address, or, where he is a director or employee of a group
                  company either to his last known address or to the address of
                  the place of business at which he performs the whole or
                  substantially the whole of the duties of his office or
                  employment, and where a notice or other communication is given
                  by first-class post, it shall be deemed to have been received
                  48 hours after it was put into the post properly addressed and
                  stamped.

         17.10    The costs of introducing and administering the plan shall be
                  borne by the company.

18.      GOVERNING LAW

         The Rules and the Plan shall in all respects be governed by the laws of
         England and the English Courts shall have non exclusive jurisdiction to
         hear and determine any disputes which arise or may arise in connection
         with the Plan.

19.      HEADINGS

         The headings contained herein are for convenience only and shall not
         affect the construction of the Rules.

ON BEHALF OF THE COMPANY I HEREBY DECLARE THAT THE BOARD HAS APPROVED AND
ADOPTED THESE RULES.

SIGNED:  DAVID R. SHEIL

CAPACITY:  SENIOR VICE PRESIDENT, HUMAN RESOURCES

DATE:  NOVEMBER 18, 2002

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