Document:

EX-10.03

 Exhibit 10.03 

EXELIS INC. 

2011 OMNIBUS INCENTIVE PLAN 

AS AMENDED AND RESTATED 

NON-QUALIFIED STOCK OPTION AWARD AGREEMENT 

THIS AGREEMENT (the “Agreement”), effective as of the      day of
            ,         , by and between Exelis Inc. (the “Company”) and [name] (the “Optionee”),
WITNESSETH: 
 WHEREAS, the Optionee is now employed by the Company or an Affiliate (as defined in the Company’s 2011 Omnibus Incentive Plan as Amended
and Restated (the “Plan”)) as an employee, and in recognition of the Optionee’s valued services, the Company, through the Compensation and Personnel Committee of its Board of Directors (the “Committee”), desires to provide
an opportunity for the Optionee to acquire or enlarge stock ownership in the Company, pursuant to the provisions of the Plan. 
 NOW, THEREFORE, in
consideration of the terms and conditions set forth in this Agreement and the provisions of the Plan, a copy of which is attached hereto and incorporated herein as part of this Agreement, and any administrative rules and regulations related to the
Plan as may be adopted by the Committee, the parties hereto hereby agree as follows: 
  

	1.	Grant of Options. In accordance with, and subject to, the terms and conditions of the Plan and this Agreement, the Company hereby confirms the grant on
                 ,         , (the “Grant Date”) to the Optionee of the option to purchase
from the Company all or any part of an aggregate of                     Shares (the “Option”), at the purchase price of
$                     per Share (the “Option Price” or “Exercise Price”). The Option shall be a Nonqualified Stock
Option. 

  

	2.	Terms and Conditions. It is understood and agreed that the Option is subject to the following terms and conditions: 

  

	 	(a)	Expiration Date. The Option shall expire on                  ,         ,
or, if the Optionee’s employment terminates before that date, on the date specified in subsection (f) below. 

  

	 	(b)	Exercise of Option. The Option may not be exercised until it has become vested. 

  

	 	(c)	Vesting. Subject to subsections 2(a) and 2(f), the Option shall vest in three installments as follows: 

  

	 	(i)	1/3 of the Option shall vest on                  ,         , 

  

	 	(ii)	1/3 of the Option shall vest on                  ,         , and

  

	 	(iii)	1/3 of the Option shall vest on                  ,         , 

 Subject to subsections 2(a) and 2(f), to the extent not earlier vested pursuant to paragraphs (i), (ii), and (iii) of
this subsection (c), the Option shall vest in full upon an Acceleration Event (as defined in the Plan). 

	 	(d)	Payment of Exercise Price. Permissible methods for payment of the Exercise Price upon exercise of the Option are described in Section 6.6 of the Plan, or, if the Plan is amended, successor provisions. In
addition to the methods of exercise permitted by Section 6.6 of the Plan, the Optionee may exercise all or part of the Option by way of (i) broker-assisted cashless exercise in a manner consistent with the Federal Reserve Board’s
Regulation T, unless the Committee determines that such exercise method is prohibited by law, or (ii) net-settlement, whereby the Optionee directs the Company to withhold Shares that otherwise would be issued upon exercise of the Option having
an aggregate Fair Market Value on the date of the exercise equal to the Exercise Price, or the portion thereof being exercised by way of net-settlement (rounding up to the nearest whole Share). 

 

	 	(e)	Tax Withholding. The Company shall have the power and the right to deduct or withhold, or require the Optionee to remit to the Company, all applicable federal, state, and local taxes, domestic or foreign,
required by law or regulation to be withheld with respect to the exercise of the Option. The Optionee may elect to satisfy the withholding requirement, in whole or in part, by having the Company withhold Shares that otherwise would be issued upon
exercise of the Option, with the number of Shares withheld having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax that could be imposed on the transaction (rounding up to the nearest whole Share).
Any such election shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate. 

  

	 	(f)	Effect of Termination of Employment. 

 If the Optionee’s employment terminates
before                  ,         , the Option shall expire on the date set forth below, as applicable:

  

	 	(i)	Termination due to Death. If the Optionee’s employment is terminated as a result of the Optionee’s death, the Option shall expire on the earlier of
                 ,         , or the date three years after the termination of the Optionee’s
employment due to death. If all or any portion of the Option is not vested at the time of the Optionee’s termination of employment due to death, the Option shall immediately become 100% vested. 

 

	 	(ii)	Termination due to Disability. If the Optionee’s employment is terminated as a result of the Optionee’s Disability (as defined below), the Option shall expire on the earlier of
                 ,         , or the date five years after the termination of the Optionee’s
employment due to Disability. If all or any portion of the Option is not vested at the time of the termination of the Optionee’s employment due to Disability, the Option shall immediately become 100% vested. 

 

	 	(iii)	 Termination due to Retirement. If the Optionee’s employment is terminated as a result of the Optionee’s Retirement (as defined
below), the Option shall expire on the earlier of                  ,         , or the date five years
after the termination of the Optionee’s employment due to Retirement. If all or any portion of the Option is not vested at the time of the Optionee’s termination of employment due to Retirement, a prorated portion of the unvested portion
of the Option shall vest pursuant to the 

	 	
paragraph entitled “Prorated or Other Vesting Upon Retirement” below, and any remaining unvested portion of the Option shall expire unless the Optionee agrees to the
conditions for continued vesting after Retirement (set forth in the second paragraph of the section entitled “Prorated or Other Vesting Upon Retirement”). For purposes of this subsection 2(f)(iii), the Optionee shall be considered employed
during any period in which the Optionee is receiving severance payments (disregarding any delays required to comply with tax or other requirements), and the date of the termination of the Optionee’s employment shall be the last day of any such
severance period. 

  

	 	(iv)	Cause. If the Optionee’s employment is terminated by the Company (or an Affiliate, as the case may be) for cause (as determined by the Committee), the vested and unvested portions of the Option shall expire
on the date of the termination of the Optionee’s employment. 

  

	 	(v)	Voluntary Termination or Other Termination by the Company. If the Optionee’s employment is terminated by the Optionee or terminated by the Company (or an Affiliate, as the case may be) for other than cause
(as determined by the Committee), and not because of the Optionee’s Retirement, Disability or Death, the vested portion of the Option shall expire on the earlier of
                 ,         , or the date three months after the termination of the Optionee’s
employment. Any portion of the Option that is not vested (or the entire Option, if no part was vested) as of the date the Optionee’s employment terminates shall expire immediately on the date of termination of employment, and such unvested
portion of the Option (the entire Option, if no portion was vested on the date of termination) shall not thereafter be exercisable. For purposes of this subsection 2(f)(v), the Optionee shall be considered employed during any period in which the
Optionee is receiving severance payments, and the date of the termination of the Optionee’s employment shall be the last day of any such severance period. 

Notwithstanding the foregoing, if an Optionee’s employment is terminated on or after an Acceleration Event (A) by the Company (or an
Affiliate, as the case may be) for other than cause (as determined by the Committee), and not because of the Optionee’s Retirement, Disability, or Death, or (B) by the Optionee because the Optionee in good faith believed that as a result
of such Acceleration Event he or she was unable effectively to discharge his or her present duties or the duties of the position the Optionee occupied just prior to the occurrence of such Acceleration Event, the Option shall in no event expire
before the earlier of the date that is 7 months after the Acceleration Event or                  ,
        . 
 Retirement. For purposes of this Agreement, the term
“Retirement” shall mean the termination of the Optionee’s employment if, at the time of such termination (or, if the Grantee receives severance in the form of salary continuation, as of the last day of such salary continuation
period), the Optionee is at least age 60 with at least 5 years of service. For this purpose, “years of service” (x) means service as an Employee of the Company or of the Predecessor Corporation and (y) shall be deemed to include
any period during which the Optionee is entitled to receive severance in the form of salary continuation. For the avoidance of doubt, termination of the Optionee’s employment by the Company for cause (as determined by the Committee) or due to
the Optionee’s Disability shall not constitute Retirement, regardless of the Optionee’s age and years of service. 

 Disability. For purposes of this Agreement, the term “Disability” shall mean the
complete and permanent inability of the Optionee to perform all of his or her duties under the terms of his or her employment, as determined by the Committee upon the basis of such evidence, including independent medical reports and data, as the
Committee deems appropriate or necessary. 
 Prorated or Other Vesting Upon Retirement. Unless the Optionee agrees to the conditions
for continued vesting after Retirement (set forth in the following paragraph, the prorated portion of an Option that vests due to the termination of the Optionee’s employment due to the Optionee’s Retirement shall be determined by
(i) multiplying the total number of Shares subject to the Option by a fraction, the numerator of which is the number of full months the Optionee has been continually employed since the Grant Date, together with any period during which the
Optionee is entitled to receive severance in the form of salary continuation (not to exceed 36 in the aggregate), and the denominator of which is 36, and (ii) reducing the product thereof by the number of Shares with respect to which the Option
had already become vested as of the date of the termination of the Optionee’s employment. For this purpose, full months of employment shall be based on monthly anniversaries of the Grant Date, not calendar months. For the avoidance of doubt,
continuous employment of an Optionee by the Company or an Affiliate for purposes of vesting in the Option granted hereunder shall include continuous employment with the Company for so long as the Optionee continues working at such entity. The
portion of the Option with respect to which the Optionee is entitled to vest pursuant to this paragraph shall vest (i) on the first vesting date set forth in Section 2(c) next following the date the Optionee’s employment terminates,
up to (but not exceeding) the portion of the Option that is eligible to vest on that vesting date pursuant to Section 2(c), and (ii) to the extent the portion of the Option that vests pursuant to this paragraph exceeds the portion of the
Option eligible to vest on that vesting date pursuant to Section 2(c), such excess portion of the Option shall vest on the subsequent vesting date(s). For example, assuming an Option to purchase 120 Shares granted on March 6, 2014, and a
termination due to Retirement on February 6, 2015, with 4 months of salary continuation severance, the Option would vest with respect to 40 Shares on March 6, 2015, and 10 Shares on March 6, 2016. 

Alternatively, and as additional consideration for the covenant set forth on Appendix B, in the event that (i) the Optionee’s
employment terminates due to the Optionee’s Retirement, and (ii) the Optionee timely executes the additional restrictive covenant agreement set forth in Appendix B, then the Option shall not vest on a prorated
basis pursuant to the preceding paragraph and, instead, on each date that the Option would otherwise have become vested under the original terms of the Option, that portion of the Option will be deemed to be vested; provided that the Optionee has
not at any time since the date of Optionee’s Retirement violated the terms of any restrictive covenant set forth in Appendix A or B (regardless of any Restricted Period set forth therein). If the Optionee does violate such restrictive covenant
at any time prior to the date that the Option would otherwise have vested under its original grant terms, such Option will terminate and expire in all respects, without further action by the Company and the Optionee hereby agrees that the Company
shall have all of the remedies and rights set forth in Section 2(i) below. 

	 	(g)	Compliance with Laws and Regulations. The Option shall not be exercised at any time when its exercise or the delivery of Shares hereunder would be in violation of any law, rule, or regulation that the Company may
find to be valid and applicable. 

  

	 	(h)	Optionee Bound by Plan and Rules. The Optionee hereby acknowledges receipt of a copy of the Plan and this Agreement and agrees to be bound by the terms and provisions thereof as amended from time to time. The
Optionee agrees to be bound by any rules and regulations for administering the Plan as may be adopted by the Committee during the life of the Option. Terms used herein and not otherwise defined shall be as defined in the Plan. 

 

	 	(i)	Restrictive Covenant Violation. Optionee acknowledges and recognizes the highly competitive nature of the businesses of the Company and its Affiliates and accordingly agrees to the provisions of Appendix A and,
if applicable, Appendix B to this Agreement. If the Optionee breaches such restrictions in Appendix A or Appendix B to this Agreement, the Optionee hereby agrees that, in addition to any other remedy available to the Company in respect of such
activity or breach, the Optionee’s Option will be forfeited and, if the Optionee has disposed of all or any portion of such Option prior to the date of such forfeiture, then, in respect of all or any portion of such Option, the Optionee shall
repay to the Company an amount equal to the aggregate after-tax proceeds (taking into account all amounts of tax that would be recoverable upon a claim of loss for payment of such proceeds in the year of repayment) the Optionee received upon the
sale or other disposition of, or distributions in respect of, the Optionee’s Option. 

  

	 	(j)	Governing Law. This Agreement is issued, and the Option evidenced hereby is granted, in McLean, Virginia, and shall be governed and construed in accordance with the laws of the State of New York, excluding any
conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. 

 The Optionee acknowledges that the Option awarded pursuant to this Agreement must be exercised, if at all,
prior to its expiration as set forth herein, that it is the Optionee’s responsibility to exercise the Option within such time period, and that the Company has no further responsibility to notify the Optionee of the expiration of the exercise
period of the Option. 
 IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its Chief Executive Officer and President,
or a Senior Vice President, as of the      day of             ,         . 

 

					
	Agreed to:	 		 	EXELIS INC.
			
	   
	 		 	   

	Optionee	 		 	
	(Online acceptance constitutes agreement)	 		 	
			
	Dated:                             	 		 	Dated:                          
        

 Enclosures 

 Appendix A 

Restrictive Covenants 
  

	 	1.	Non-Solicit. 

 (a) Optionee acknowledges and recognizes the highly competitive nature of
the businesses of the Company and its affiliates and accordingly agrees as follows: 
 (i) Optionee will not, within twelve
months following the termination of his or her employment with the Company for any reason (the “Post-Termination Period”) or during Optionee’s employment (collectively with the Post-Termination Period, the “Restricted
Period”), influence or attempt to influence customers of the Company or its subsidiaries or any of its present or future subsidiaries or affiliates, either directly or indirectly, to divert their business to any individual, partnership,
firm, corporation or other entity then in competition with the business of the Company or any subsidiary or affiliate of the Company. 

(ii) During the Restricted Period, Optionee will not, and will not directly or indirectly, cause any other person to, initiate
or respond to communications with or from, any employee of the Company or its subsidiaries during the twelve-month period prior to the termination of such employee’s employment with the Company, for the purpose of soliciting such employee, or
facilitating the hiring of any such employee, to work for any other business, individual, partnership, firm, corporation, or other entity; and 

(b) It is expressly understood and agreed that although Optionee and the Company consider the restrictions contained in this Appendix A to be
reasonable, if a final judicial determination is made by a court of competent jurisdiction, that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against Optionee, the provisions of this
Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent
jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained
herein. 
 (c) The period of time during which the provisions of this Appendix A shall be in effect shall be extended by the length of time
during which Optionee is in breach of the terms hereof as determined by any court of competent jurisdiction on the Company’s application for injunctive relief. 
  

	 	2.	Survival. 

 (a) The provisions of this Appendix A shall survive the termination of
Optionee’s employment for any reason. 

 Appendix B 

Additional Restrictive Covenant Upon Retirement 

Pursuant to the second paragraph under the heading “Prorated or Other Vesting Upon Retirement” in Section 2(f) of the
Non-Qualified Stock Option Award Agreement to which this document is appended (the “Award Agreement”), the following covenants shall apply to the Optionee if (i) the Optionee’s employment terminates due to the Optionee’s
Retirement, and (ii) the Optionee acknowledges and agrees to the terms hereof by executing this document and returning it to
[                    
                    ] no later than first to occur of (i) the 30th day following the
date of the Optionee’s termination of employment (not counting any period during which the Optionee is receiving any salary continuation) and (ii) the day before the first vesting date upon which any amounts would become vested pursuant to
the second paragraph under the heading “Prorated or Other Vesting Upon Retirement” in Section 2(f) of the Award Agreement. If the Optionee does not timely execute this document, the Optionee shall not be eligible for the additional
vesting rights set forth in the second paragraph under the heading “Prorated or Other Vesting Upon Retirement” in Section 2(f) of the Award Agreement. 
  

	 	1.	Non-Competition. 

 (a) Optionee acknowledges and recognizes the highly competitive nature
of the businesses of the Company and its affiliates and accordingly agrees as follows: 
 (i) Optionee will not, within the
period during which the Award remains unvested following the termination of his employment with the Company for any reason (the “Post-Termination Period”) or during Optionee’s employment (collectively with the Post-Termination Period,
the “Restricted Period”), accept an employment or consulting relationship (or own or have any financial interest in), directly or indirectly, with any entity engaged in the business of providing [Command, Control, Communications,
Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) related products and systems and information and technical services to military, government and commercial customers within the United States]. 

Notwithstanding anything to the contrary in this Agreement, Optionee may, directly or indirectly own, solely as an investment, securities of
any Person which are publicly traded on a national or regional stock exchange or on the over-the-counter market if Optionee (i) is not a controlling person of, or a member of a group which controls, such person and (ii) does not, directly
or indirectly, own 5% or more of any class of securities of such Person. 
 (b) It is expressly understood and agreed that although Optionee
and the Company consider the restrictions contained in this Appendix B to be reasonable, if a final judicial determination is made by a court of competent jurisdiction, that the time or territory or any other restriction contained in this Agreement
is an unenforceable restriction against Optionee, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially
determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding
shall not affect the enforceability of any of the other restrictions contained herein. 
 (c) The period of time during which the provisions
of this Appendix B shall be in effect shall be extended by the length of time during which Optionee is in breach of the terms hereof as determined by any court of competent jurisdiction on the Company’s application for injunctive relief. 

	 	2.	Survival. 

 (a) The provisions of this Appendix B shall survive the termination of
Optionee’s employment for any reason. 
 * * * * * * * * * * * * 

By signing the below, the Optionee hereby acknowledges, and agrees to be bound by, the foregoing covenants set forth in this Appendix B. 

 

					
			
	   
	 		 	   

			
	Optionee	 		 	Optionee (Print)
			
	Dated:EX-10.04

 Exhibit 10.04 

EXELIS INC. 

2011 OMNIBUS INCENTIVE PLAN 

AS AMENDED AND RESTATED 

TSR AWARD AGREEMENT 
 THIS
AGREEMENT (the “Agreement”), effective as of the      day of             ,         , by and
between Exelis Inc. (the “Company”) and «First_Name» «Last_Name» (the “Participant”), WITNESSETH: 

WHEREAS, the Participant is now employed by the Company as an employee, and in recognition of the Participant’s valued services, the Company, through the
Compensation and Personnel Committee of its Board of Directors (the “Committee”), desires to provide an opportunity for the Participant to receive a performance-based long-term incentive award, pursuant to the provisions of the
Company’s 2011 Omnibus Incentive Plan as Amended and Restated (the “Plan”). 
 NOW, THEREFORE, in consideration of the terms and conditions
set forth in this Agreement and the provisions of the Plan, a copy of which is attached hereto and incorporated herein as part of this Agreement, and any administrative rules and regulations related to the Plan as may be adopted by the Committee,
the parties hereto hereby agree as follows: 
  

	1.	Grant of Target Award and Performance Period. In accordance with, and subject to, the terms and conditions of the Plan and this Agreement, the Company hereby grants to the Participant a target Award of
$             (the “Target Award”) for the                  Performance Period
commencing January 1, 20     and ending December 31, 20    . Payment of the Award is dependent upon the achievement during the Performance Period of certain performance goals more fully
described in Section 2 of this Agreement. 

  

	2.	Terms and Conditions. It is understood and agreed that this Award is subject to the following terms and conditions: 

  

	 	(a)	Determination of TSR Award Payout. 

 (i) The amount of the TSR Award Payout, if any, for
the Performance Period shall be determined in accordance with the following formula: 
 TSR Award Payout = Payout Factor X Target Award

 The “Payout Factor” is based on the Company’s total shareholder return (defined and measured in accordance with
paragraph (ii) below, the “TSR”) for the Performance Period relative to the TSR for each company in the S&P 1500 Aerospace/Defense Index, determined in accordance with the following Table: 

 

			
	 If Company’s TSR rank against the

S&P 1500 Aerospace/Defense Index is
	  	 Payout Factor

            (% of Target Award)      
      

	less than the 25th percentile	  	0%
	at the 25th percentile	  	50%
	at the 50th percentile	  	100%
	at the 75th percentile	  	200%
	Actual results between the 25th percentile and the 75th percentile numbers shown above are
interpolated.

 (ii) TSR is the percentage change in value of a shareholder’s investment from the beginning
to the end of the performance period, assuming reinvestment of dividends and any other shareholder payouts during the performance period. For purposes of this agreement, the stock price at the beginning of the performance period will be the average
closing price over the trading days in the month immediately preceding the start of the performance period (December         ), and the stock price at the end of the performance period will be the
average closing stock price over the trading days in the last month of the performance period (December         ). 

(iii) The “Competitors” means each company in the S&P 1500 Aerospace/Defense Index. 

 

	 	(b)	Form and Timing of Payment of Award. Except as provided in subsection 2(f), payment with respect to an earned TSR Award shall be made as soon as practicable (but not later than March 15th) in the calendar year following the close of the Performance Period. Payment shall be made in cash. 

  

	 	(c)	Effect of Termination of Employment. Except as otherwise provided below, if the Participant’s employment with the Company is terminated for any reason prior to the end of the Performance Period, any Award
subject to this Agreement shall be immediately forfeited. 

 (i) Termination due to Death or Disability. If the
Participant’s termination of employment is due to death or Disability (as defined below), the Award shall vest and will be payable at the time and in the form as provided in subsection 2(b) above based on the Company’s TSR for the entire
Performance Period relative to the TSR of the Company’s Competitors for the entire Performance Period. 
 (ii) Termination due to
Retirement or Termination by the Company for Other than Cause. If the Participant’s termination of employment is due to Retirement (as defined below) or if the Participant’s employment is terminated by the Company (or a Participant
Company, as the case may be) for other than cause (as determined by the Committee), a prorated portion of the Award shall vest (see Section 2(d)(i) below) and will be payable at the time and in the form as provided in subsection 2(b) above,
unless the Participant agrees to the conditions for continued vesting after Retirement (set forth in Section 2(d)(ii) below). For purposes of this subsection 2(c)(ii), the Participant shall be considered employed during any period
in which the Participant is receiving severance pay, and the date of the termination of the Participant’s employment shall be the last day of any such severance pay period. 

Retirement. For purposes of this Agreement, the term “Retirement” shall mean the termination of the Participant’s
employment if, at the time of such termination (or, if the Participant receives severance in the form of salary continuation, as of the last day of such salary continuation period), the Participant is at least age 60 with at least 5 years of
service. For this purpose, “years of service” (x) means service as an Employee of the Company or of the Predecessor Corporation and (y) shall be deemed to include any period during which the Participant is entitled to receive
severance in the form of salary continuation. For the avoidance of doubt, termination of the Participant’s employment by the Company for cause (as determined by the Committee) or due to the Participant’s Disability shall not constitute
Retirement, regardless of the Participant’s age and years of service. 
 Disability. For purposes of this Agreement, the term
“Disability” shall mean the complete and permanent inability of the Participant to perform all of his or her duties under the terms of his or her employment, as determined by the Committee upon the basis of such evidence, including
independent medical reports and data, as the Committee deems appropriate or necessary. 

  
 2 

	 	(d)	Prorated or Other Vesting upon Retirement or Termination by the Company for Other than Cause. 

(i) Unless the Participant agrees to the conditions for continued vesting after Retirement (set forth in Section 2(d)(ii) below), the
prorated portion of the Award that vests due to termination of the Participant’s employment due to Retirement or by the Company for other than cause shall be determined by multiplying (x) the TSR Award Payout that would have been paid
based on the Company’s TSR for the entire Performance Period relative to the TSR of the Company’s Competitors for the entire Performance Period, by (y) a fraction, the numerator of which is the number of full months the Participant
has been continually employed since the beginning of the Performance Period, together with any period during which the Participant is entitled to receive severance in the form of salary continuation (not to exceed 36 in the aggregate), and the
denominator of which is the number of full months in the Performance Period. For this purpose, full months of employment shall be based on monthly anniversaries of the commencement of the Performance Period. For the avoidance of doubt, continuous
employment of a Participant by the Company or an Affiliate for purposes of vesting in the Award granted hereunder shall include continuous employment with the Company for so long as the Participant continues working at such entity. 

(ii) Alternatively, and as additional consideration for the covenant set forth on Appendix B, in the event that (x) the Participant’s
employment terminates due to Retirement, and (y) the Participant timely executes the additional restrictive covenant agreement set forth in Appendix B, then the Award shall vest and will be payable at the time and in
the form as provided in subsection 2(b) above based on the Company’s TSR for the entire Performance Period relative to the TSR of the Company’s Competitors for the entire Performance Period (without proration); provided that the
Participant has not at any time since the date of Participant’s Retirement violated the terms of any restrictive covenant set forth in Appendix A or B (regardless of any Restricted Period set forth therein). If the Participant does violate such
restrictive covenant at any time prior to the date that the Award would otherwise have vested under its original grant terms, the Award will terminate and expire in all respects, without further action by the Company, and the Participant hereby
agrees that the Company shall have all of the remedies and rights set forth in Section 2(h) below. 
  

	 	(e)	 Acceleration Event. Notwithstanding anything in the Plan to the contrary, upon the occurrence of an Acceleration Event during the Performance
Period, (i) a prorated portion of the Award shall vest based on actual performance though the date of the Acceleration Event (such prorated portion to be determined as provided below in this subsection 2(e)) and shall be paid within 30 days
following the Acceleration Event and (ii) the remaining portion of the Award (such remaining portion to be determined as provided below in this subsection 2(e)) shall vest and shall be paid within 30 days following the Acceleration Event. The
prorated portion of the Award that vests pursuant to subpart (i) in the prior sentence due to the Acceleration Event shall be determined by multiplying (A) the TSR Award Payout determined based on the Company’s TSR relative to the TSR
of the Company’s Competitors, based on TSR performance for the period beginning January 1,          and ending on the date preceding the date on which the Acceleration Event occurs (the
“Prorated Period”), by (B) a fraction, the numerator of which is the number of calendar days in the Prorated Period and the denominator of which is the total number of days in the Performance Period. The remaining portion of the Award
that vests pursuant to subpart (ii) in the 

  
 3 

	 	
first sentence of this subsection 2(e) due to the Acceleration Event shall be determined by multiplying (A) the Target Award by (B) a fraction, the numerator of which is the number of
calendar days remaining in the Performance Period as of the date of the Acceleration Event (including day of the Acceleration Event) and the denominator of which is the total number of days in the Performance Period. 

 

	 	(f)	Tax Withholding. Payments with respect to Awards under the Plan shall be subject to applicable tax withholding obligations as described in Section 15.1 of the Plan, or, if the Plan is amended, successor
provisions. 

  

	 	(g)	Participant Bound by Plan and Rules. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement and agrees to be bound by the terms and provisions thereof. The Participant agrees to be
bound by any rules and regulations for administering the Plan as may be adopted by the Committee prior to the settlement of the Award subject to this Agreement. Terms used herein and not otherwise defined shall be as defined in the Plan.

  

	 	(h)	Restrictive Covenant Violation. Participant acknowledges and recognizes the highly competitive nature of the businesses of the Company and its Affiliates and accordingly agrees to the provisions of Appendix A
and, if applicable, Appendix B to this Agreement. If the Participant breaches such restrictions in Appendix A or Appendix B to this Agreement, the Participant hereby agrees that, in addition to any other remedy available to the Company in respect of
such activity or breach, the Participant’s Award will be forfeited and, if the Participant has disposed of all or any portion of such Award prior to the date of such forfeiture, then, in respect of all or any portion of such Award, the
Participant shall repay to the Company an amount equal to the aggregate after-tax proceeds (taking into account all amounts of tax that would be recoverable upon a claim of loss for payment of such proceeds in the year of repayment) the Participant
received upon the sale or other disposition of, or distributions in respect of, the Participant’s Award. 

  

	 	(i)	Governing Law. This Agreement is issued in McLean, Virginia, and shall be governed and construed in accordance with the laws of the State of New York, excluding any conflicts or choice of law rule or principle
that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. 

IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its Chief Executive Officer and President, or a
Senior Vice President, as of the [    ] day of                 ,         . 

 

					
	Agreed to:	 		 	Exelis Inc.
			
	   
	 		 	   

	Participant	 		 	
			
	Dated:                             	 		 	Dated:                             

 Enclosures 

  
 4 

 Appendix A 

Restrictive Covenants 
  

	 	1.	Non-Solicit. 

 (a) Participant acknowledges and recognizes the highly competitive nature
of the businesses of the Company and its affiliates and accordingly agrees as follows: 
 (i) Participant will not, within
twelve months following the termination of his or her employment with the Company for any reason (the “Post-Termination Period”) or during Participant’s employment (collectively with the Post-Termination Period, the
“Restricted Period”), influence or attempt to influence customers of the Company or its subsidiaries or any of its present or future subsidiaries or affiliates, either directly or indirectly, to divert their business to any
individual, partnership, firm, corporation or other entity then in competition with the business of the Company or any subsidiary or affiliate of the Company. 

(ii) During the Restricted Period, Participant will not, and will not directly or indirectly, cause any other person to,
initiate or respond to communications with or from, any employee of the Company or its subsidiaries during the twelve-month period prior to the termination of such employee’s employment with the Company, for the purpose of soliciting such
employee, or facilitating the hiring of any such employee, to work for any other business, individual, partnership, firm, corporation, or other entity; and 

(b) It is expressly understood and agreed that although Participant and the Company consider the restrictions contained in this Appendix A to
be reasonable, if a final judicial determination is made by a court of competent jurisdiction, that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against Participant, the provisions of
this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of
competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions
contained herein. 
 (c) The period of time during which the provisions of this Appendix A shall be in effect shall be extended by the length
of time during which Participant is in breach of the terms hereof as determined by any court of competent jurisdiction on the Company’s application for injunctive relief. 

 

	 	2.	Survival. 

 (a) The provisions of this Appendix A shall survive the termination of
Participant’s employment for any reason. 

  
 5 

 Appendix B 

Additional Restrictive Covenant Upon Retirement 

Pursuant to Section 2(d)(ii) of the TSR Award Agreement to which this document is appended (the “Award Agreement”), the
following covenants shall apply to the Participant if (i) the Participant’s employment terminates due to the Participant’s Retirement, and (ii) the Participant acknowledges and agrees to the terms hereof by
executing this document and returning it to [                    ] no later than first to occur of (i) the 30th day following the date of the Participant’s termination of employment (not counting any period during which the Participant is receiving any salary continuation) and (ii) the day before
the first vesting date upon which any amounts would become vested pursuant to Section 2(d)(ii) of the Award Agreement. If the Participant does not timely execute this document, the Participant shall not be eligible for the additional vesting
rights set forth in Section 2(d)(ii) of the Award Agreement. 
  

	 	1.	Non-Competition. 

 (a) Participant acknowledges and recognizes the highly competitive
nature of the businesses of the Company and its affiliates and accordingly agrees as follows: 
 (i) Participant will not,
within the period during which the Award remains unvested following the termination of his employment with the Company for any reason (the “Post-Termination Period”) or during Participant’s employment (collectively with the
Post-Termination Period, the “Restricted Period”), accept an employment or consulting relationship (or own or have any financial interest in), directly or indirectly, with any entity engaged in the business of providing [Command, Control,
Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) related products and systems and information and technical services to military, government and commercial customers within the United States]. 

Notwithstanding anything to the contrary in this Agreement, Participant may, directly or indirectly own, solely as an investment, securities of
any Person which are publicly traded on a national or regional stock exchange or on the over-the-counter market if Participant (i) is not a controlling person of, or a member of a group which controls, such person and (ii) does not,
directly or indirectly, own 5% or more of any class of securities of such Person. 
 (b) It is expressly understood and agreed that although
Participant and the Company consider the restrictions contained in this Appendix B to be reasonable, if a final judicial determination is made by a court of competent jurisdiction, that the time or territory or any other restriction contained in
this Agreement is an unenforceable restriction against Participant, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable,
such finding shall not affect the enforceability of any of the other restrictions contained herein. 
 (c) The period of time during which
the provisions of this Appendix B shall be in effect shall be extended by the length of time during which Participant is in breach of the terms hereof as determined by any court of competent jurisdiction on the Company’s application for
injunctive relief. 
  

	 	2.	Survival. 

 (a) The provisions of this Appendix B shall survive the termination of
Participant’s employment for any reason. 

  
 6 

 * * * * * * * * * * * * 

By signing the below, the Participant hereby acknowledges, and agrees to be bound by, the foregoing covenants set forth in this Appendix B. 

 

					
			
	   
	 		 	   

	Participant	 		 	Participant (Print)
			
	Dated:                             	 		 	

  
 7

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