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                                                                     Exhibit 4.9

                                       ABB

                              EMPLOYMENT AGREEMENT

This Employment Agreement is made as of the 1st day of January, 2003 between ABB
Inc. (who, together with its parent companies, are hereinafter referred to as
the "Company") and Dinesh Paliwal (hereinafter referred to as "Executive").

WHEREAS, the Executive has been serving as a senior executive for the Company
and;

WHEREAS, the Company desires to continue to retain the services of the Executive
and the Executive desires to continue to perform services for the Company;

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the Company and the Executive agree as follows:

1.   EMPLOYMENT

     1.1  The Company agrees to employ the Executive and the Executive agrees to
          undertake employment with the Company upon the terms and conditions
          herein set forth for a period of two (2) years commencing on January
          1, 2003 and expiring on December 31, 2004, subject to earlier
          expiration upon the Executive's termination under Section 5 of this
          Agreement. Following this initial term, this Agreement and the
          employment of the Executive will be automatically renewed, subject to
          Section 5, for successive two (2) year periods, unless either party to
          this Agreement gives the other party written notice of such party's
          intention to terminate this Agreement at least three months prior to
          the end of the initial or any extended term.

     1.2  The Executive represents and warrants that his execution of this
          Agreement and the performance by Executive of his obligations under
          this Agreement will not (i) violate any judgment, writ, injunction, or
          order of any court, arbitrator, or governmental agency applicable to
          the Executive; or (ii) conflict with, result in the breach of any
          provision of or the termination of, or constitute a default under, any
          agreement to which Executive is a party or by which Executive is or
          may be bound.

2.   POSITION, DUTIES AND LOCATION

     2.1  The Executive shall be a full-time employee of the Company and shall
          serve the Company in the position of Executive Vice President,
          Automation Technologies Division and in such position will report to
          Jurgen Dormann, Chairman and Chief Executive Officer.

     2.2  During the term of his employment, the Executive shall, (i) faithfully
          and diligently perform such duties and exercise such powers consistent
          with his position, perform such other related duties and
          responsibilities, and serve in such other regular positions as may be
          assigned to him/her from time to time

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          by the Company; (ii) devote the whole of his business time and
          attention and skill to his duties and not engage in, participate in,
          render any service to, or undertake any employment, either directly or
          indirectly, with respect to any other business or for any other entity
          (including, but not limited to, acting in an advisory or consulting
          capacity and/or serving as a director of any entity) if such activity
          would, in the sole discretion of the Company, interfere with the
          Executive's performance of, or conflict with, his duties and
          responsibilities to the Company, without the prior written consent of
          the Company, provided, however, that the executive agrees that he/she
          will not serve as a member of the Board of Directors of any
          non-affiliated corporation without the express written consent of the
          Chief Executive Officer of the ABB Group; (iii) use his best efforts
          to promote the interests of the Company and (iv) adhere to all
          applicable laws, and all policies, standards, rules and regulations of
          the Company in effect from time to time.

     2.3  The Executive's principal office and location of employment will be
          determined by the Company it being understood, however, that the
          responsibilities of the Executive's position will require normal
          business travel.

3.   COMPENSATION AND BENEFITS - The Company shall provide and the Executive
     shall accept as full consideration for the services to be rendered
     compensation and benefits consisting of the following:

     3.1  BASE SALARY - The Executive's base salary as of the date of this
          Agreement is at the annual rate of $550,000, payable in accordance
          with the Company's payroll practices as currently in effect from time
          to time. The Executive's performance shall be reviewed annually during
          his term of employment, and his salary may be adjusted based upon the
          Executive's performance and the Company's executive compensation
          policies then in effect.

     3.2  INCENTIVE COMPENSATION - The Executive shall be entitled to
          participate in the Company's Management Incentive Plan (if the Company
          determines in its sole discretion to maintain the Plan) in accordance
          with the terms and conditions of the Plan including, but not limited
          to, the right by the Company to amend, suspend, discontinue or
          terminate the Plan. The Executive's incentive target for 2003 will be
          up to a maximum of 100% of base salary. The Executive's incentive
          target shall be reviewed and may be adjusted at the discretion of the
          Company each year for the term of this Agreement.

     3.3  BENEFITS - The Executive (and to the extent eligible, Executive's
          dependents) shall be entitled to participate in the general employee
          benefit plans, policies and programs sponsored by the Company from
          time to time, including without limitation, retirement, health,
          disability, life, accidental death, vacation, holiday and severance
          benefits, at a level that is commensurate with the Executive's
          participation in such plans immediately prior to the effective date of
          this Agreement, or at a level made available to the Executive at any
          time hereafter. Participation by the Executive and/or his dependents
          in these benefits shall be in accordance with the terms and conditions
          of the respective plans, policies, and programs including, but not
          limited to, the eligibility rules and the Company's right to amend,
          suspend, discontinue or terminate any such plan, policy or program,
          and the same are incorporated herein by reference.

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     3.4  OTHER FORMS OF COMPENSATION AND BENEFITS - In addition to the above
          compensation and benefits, the Company will provide the Executive with
          the supplemental compensation and/or benefits listed below, pursuant
          to the terms and conditions of the respective plans, policies or
          programs:

          (i)   A car allowance of $2,000 per month;

          (ii)  Participation in the Company's financial counseling program, at
                the "Senior Executive" level. The Senior Executive level
                provides for comprehensive estate and tax planning, retirement
                planning, cash flow planning, investment planning, and tax
                preparation as provided by The Ayco Company, L.P. ("Ayco"). As
                an alternative to the Ayco program, the Executive may elect
                reimbursement of up to $10,000 per year for similar expenses
                incurred with a provider or providers other than Ayco;

          (iii) Elective participation in the Company's Deferred Compensation
                Plan;

          (iv)  Participation in the Company's Supplemental Executive Retirement
                Plan ("SERP");

          (v)   Such vacation time, sick leave, perquisites of office, fringe
                benefits, insurance coverage, participation in pension plans,
                profit sharing plans, other employee benefit and welfare plans
                and other terms and conditions of employment as the Company
                generally provides to its executives having rank and seniority
                at the Company comparable to the Executive.

          (vi)  Such other perquisites and terms and conditions of employment as
                the Company may provide from time to time to its executives
                having rank and seniority at the Company comparable to that of
                the Executive.

          (vii) The retention incentive outlined in a letter dated January 25,
                2002 addressed to Dinesh Paliwal and signed by Jorgen Centerman
                and Arne Olsson.

4.   REIMBURSEMENT OF EXPENSES - The Company shall reimburse the Executive for
     all reasonable travel and other business-related expenses incurred by
     him/her in the performance of his duties under this Agreement, in
     accordance with the Company's policies and practices in effect from time to
     time.

5.   TERMINATION OF EMPLOYMENT - The Executive's employment may be terminated in
     accordance with the following:

     5.1  The Executive's employment shall terminate automatically upon the
          death of the Executive.

     5.2  The Company may remove the Executive from his duties if the Executive
          suffers from a physical or mental disability to an extent that such
          disability renders the Executive incapable of performing substantially
          his duties for a period of 180 consecutive days. In this regard, the
          Executive agrees to submit,

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          at the request of the Company, to a physical and/or mental examination
          by a physician selected by the Company. In such situation, the
          Executive shall be regarded as being on disability leave and shall
          continue in such status, and will be eligible to receive Company
          benefits provided to an employee in such status, subject to the terms
          and conditions of the Company's applicable disability benefit plans,
          programs, and related practices.

     5.3  The Company may terminate the Executive's employment for any reason or
          no reason upon giving four weeks written notice of termination to the
          Executive. Notwithstanding, the Company may, at its discretion, choose
          to immediately terminate the Executive and pay the Executive in lieu
          of notice for the full notice period or any remaining part thereof.

     5.4  The Executive may terminate his employment for any reason or no reason
          upon giving four (4) weeks written notice of termination to the
          Company.

     5.5  The Company may terminate the Executive's employment at any time for
          cause. "Cause" shall include, but not be limited to, actions which are
          intended to seriously damage the Company's or an affiliate's business
          or reputation; significant violations of any material policy,
          standard, rule, or practice of the Company; actions in violation of
          the Executive's fiduciary duties to the Company or its affiliates;
          failure or neglect by the Executive to substantially perform his
          duties; or a material breach of any provision of this Agreement.

     5.6  Upon termination of the employment for any reason, Executive shall, as
          requested by the Company, immediately resign any position he/she holds
          as an officer and/or director of the Company or any affiliated
          company.

     5.7  All documents and objects made, compiled, received, held or used by
          the Executive while employed by the Company in connection with the
          business of the Company or any of its affiliates shall be and remain
          the property of the Company or the affiliate, and shall be delivered
          by the Executive to the Company or affiliate upon the termination of
          the Executive's employment or at any earlier time requested by the
          Company or affiliate.

6.   Obligations of the Company Upon Termination

     6.1  Upon termination of employment by either the Executive or the Company
          for any reason, the Executive shall receive any base salary earned and
          unpaid; reimbursement for business expenses incurred up to the date of
          termination; all amounts and/or benefits due under the Company's
          compensation and benefit plans and programs identified in Section 3
          above as may be applicable to the Executive's termination, all in
          accordance with the respective terms of those applicable plans and
          programs; and any other applicable legal benefits (e.g. COBRA).

     6.2  Upon termination of employment initiated by the Company for any reason
          other than cause and in consideration for the Confidentiality and
          Non-Disclosure (Paragraph 8), Non-Competition (Paragraph 9) and
          Non-Solicitation (Paragraph 10) provisions of this Agreement, the
          Executive will be paid an amount equal to two year's base salary plus
          an amount equal to two

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          times the average of the amount of the last two incentive compensation
          payments (determined by adding such two last incentive compensation
          payments and dividing the total so obtained by two), if any, paid to
          the Executive (or, if any amount of any such incentive payment is
          earned by the Executive but deferred under the Company's Deferred
          Compensation Plan, the amount of any such incentive payment which is
          deferred) prior to the termination of the Executive's employment or
          the termination of this Agreement by the Company under the Management
          Incentive Plan. The amounts payable under this Paragraph 6.2, will be
          paid to the Executive as a lump sum payment at the time of termination
          of employment and/or this Agreement by the Company. In the event
          severance payments are payable to Executive pursuant to this Paragraph
          6.2, no severance benefits shall be payable to the Executive under the
          ABB Inc. Severance Benefit Plan. Except as specified in the prior
          sentence, the amounts and benefits identified in this Paragraph 6.2
          are in addition to any amounts and/or benefits provided to the
          Executive pursuant to Paragraph 6.1.

     6.3  Upon termination, any outstanding funds advanced by the Company or its
          affiliates to or on behalf of the Executive shall become immediately
          due and payable by the Executive, and may be deducted from monies due
          the Executive upon termination, to the extent allowed by applicable
          law.

7.   DEDUCTIONS AND WITHHOLDING - Executive agrees that the Company shall
     withhold from any and all payments required to be made to Executive in
     accordance with this Agreement all federal, state, local, and other taxes
     that the Company determines are required to be withheld in accordance with
     applicable statutes and regulations in effect from time to time.

8.   CONFIDENTIALITY AND NON-DISCLOSURE - The Executive shall not, either during
     or after his employment by the Company, divulge or communicate to any
     person (except in performing his duties under this Agreement) or use for
     his own purposes, trade secrets, confidential commercial information, or
     any other information, knowledge, or data of the Company or of any of its
     affiliates which is not generally known to the public, and shall use his
     best efforts to prevent the publication or disclosure by any other person
     of any such secrets, information, knowledge, or data. Confidential
     information includes, without limitation, information relating to the
     Company's or its affiliates' business plans, financial matters, customers,
     employees, contracts, and all other secrets and information of a
     confidential or proprietary nature. The confidentiality and non-disclosure
     obligations imposed by this Section 8 will cease if such confidential or
     proprietary information will have become, through no fault of the
     Executive, generally known to the public or the Executive is required by
     law to make disclosure (after giving the Company notice and an opportunity
     to contest such requirement). The terms of this Section 8 shall be in
     addition to the terms of any confidentiality agreement that may previously
     have been executed by the Executive, which will continue in effect and be
     made a part of this Agreement, and shall not be read or interpreted to
     limit, diminish, circumscribe or conflict with the terms or requirements of
     any such confidentiality agreement.

9.   NON-COMPETITION - NON-COMPETE

     The Executive agrees that during his employment by the Company, and for a
     period

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     of one year after termination of his employment for any reason, he will not
     directly or indirectly, whether or not for compensation and whether or not
     as an employee, be engaged in any work or activity for or with, or have any
     financial interest in, any business materially in competition with, or
     which may materially compete with the business of the Company (or with the
     business of any affiliate for which the Executive performed services
     hereunder) within any country, state, region, or locality in which the
     Company or such affiliate is then doing business or marketing its products,
     as the business of the Company or such affiliate may then be constituted.
     For purposes of this Agreement, the Executive shall be deemed to be engaged
     in or to have financial interest in such a business if he is a principal,
     agent, consultant, employee, officer, director, or partner, of any person,
     partnership, corporation, trust or other entity which is engaged in such a
     business, or has an equity interest, or interest convertible into equity,
     in any such entity; provided, however, that the foregoing shall not
     prohibit the Executive from owning, for the purpose of passive investment,
     less than 5% of any class of securities of a publicly held corporation.

10.  NON-SOLICITATION - The Executive agrees that for a period of one year after
     the termination of his employment for any reason he/she will not, on behalf
     of himself/herself or on behalf of any person, firm, or corporation
     intentionally induce, solicit, or participate in the inducement or
     solicitation, either directly or through a third party, of any person who
     is an officer, director, employee, principal or agent of the Company or any
     affiliate to leave his or her employment, agency, directorship or office
     with the Company or any affiliate, or to induce or solicit any person to
     not commence an employment or business relationship with the Company or any
     affiliate.

11.  COMPANY OWNERSHIP - The Executive hereby agrees that any and all
     improvements, inventions, discoveries, formulae, processes, methods,
     know-how, confidential data, trade secrets and other proprietary
     information (collectively, "Work Product") within the scope of any business
     of the Company or any affiliate which the Executive may conceive or make,
     or have conceived or made, during his employment with the Company shall be
     and are the sole and exclusive property of the Company or its affiliate.
     The Executive shall, whenever requested to do so by the Company or its
     affiliate, and without any obligation on the part of the Company or its
     affiliate to pay any royalty or other compensation to the Executive, at the
     Company's or affiliate's expense, execute and sign any and all
     applications, assignments or other instruments and do all other things
     which the Company or its affiliate may deem necessary or appropriate (i) in
     order to apply for, obtain, maintain, enforce or defend letters patent in
     the United States or in any foreign country for any Work Product, and/or
     (ii) in order to assign, transfer, convey or otherwise make available to
     the Company or its affiliate the sole and exclusive right, title, and
     interest in and to any Work Product.

12.  INJUNCTIVE RELIEF - The Executive acknowledges and agrees that the remedy
     at law available to the Company for breach of any of his obligations under
     Sections 8, 9, 10 and 11 would be inadequate and that damages flowing from
     such breach may not readily be susceptible to being measured in monetary
     terms. Accordingly, the Executive acknowledges and agrees that, in addition
     to any other rights or remedies which the Company may have at law, in
     equity or under this Agreement, upon adequate proof of his violation of any
     such provision of this Agreement, the Company will be entitled to immediate
     injunctive relief, and may obtain a temporary order restraining any
     threatened or further breach, without the necessity of proof of actual

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     damage.

13.  POST-TERMINATION ASSISTANCE - The Executive agrees that after his
     employment with the Company has terminated he/she will provide, upon
     reasonable notice, such cooperation, information and assistance to the
     Company as may reasonably be requested by the Company in connection with
     any audit, governmental investigation or litigation in which it or any of
     its affiliates is or may become a party; provided, however, that (i) the
     Company agrees to reimburse the Executive for any related out-of-pocket
     expenses, including travel expenses, and to pay the Executive reasonable
     compensation for his time based on his rate of annual salary at the time of
     termination and (ii) any such assistance may not unreasonably interfere
     with the then current employment of the Executive. It's the Company's
     expectation that any cooperation, assistance or information provided
     pursuant to this Section be truthful.

14.  SURVIVAL - The termination of the Executive's employment will not impair
     the rights or obligations of a party that accrue prior to such termination,
     except to the extent specifically stated herein. In addition, the
     Executive's covenants contained in Sections 8, 9, 10 and 11 and the
     Company's obligations under Section 6 will survive the termination of the
     Executive's employment.

15.  NOTICE-Notice or other communication required or permitted under this
     Agreement shall be effective only if it is in writing and delivered
     personally, or sent by registered or certified mail, postage prepaid,
     addressed as follows:

     If to the Company:                 If to the Executive:

          Jeff Halsey                        Dinesh Paliwal
          Senior Vice President, HR          9 Old Hyde Road
          ABB Inc.                           Weston, CT 06883
          650 Ackerman Road
          Columbus, OH 43202

     or to such other address as either party may designate by notice to the
     other, and shall be deemed to have been given upon receipt.

16.  AMENDMENTS AND NO WAIVER - Only an instrument in writing signed by the
     parties may amend this Agreement, and any provision hereof may be waived
     only by an instrument in writing signed by the party against whom
     enforcement of such waiver is sought. The failure of either party at any
     time to require the performance by the other party of any provision hereof
     shall in no way affect the full right to require such performance at any
     time thereafter, nor shall the waiver by either party of a breach of a
     provision hereof be taken or held to be a waiver of any succeeding breach
     of such provision or a waiver of the provision itself or a waiver of any
     other provision of this Agreement.

17.  DISPUTE RESOLUTION - Any dispute between the parties arising out of or
     relating to this Agreement, or the employment relationship, shall first be
     submitted to non-binding mediation as set forth below in Section 17.1. In
     the event either party is not satisfied with the results of the mediation
     proceeding any unresolved disputes shall be submitted to arbitration as
     provided in Section 17.2.

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     17.1 Mediation proceedings shall be conducted in accordance with the
          National Rules for Resolution of Employment Disputes of the American
          Arbitration Association ("AAA") in effect on the date notice of
          mediation is served and shall be non-binding on the parties. In no
          event shall the results of any mediation proceeding be admissible in
          any arbitration or judicial proceeding.

     17.2 Arbitration of any dispute shall be held in the State of Connecticut,
          USA, in accordance with the National Rules for Resolution of
          Employment Disputes then obtaining of the AAA, except that there shall
          be one arbitrator selected with respect to any such arbitration
          proceeding. Judgment upon the award rendered may be entered in any
          court having jurisdiction thereof. Notwithstanding anything herein to
          the contrary, if any dispute arises between the parties under
          Paragraphs 8, 9, 10 or 11 hereof, or if the Company makes any claim
          under Paragraphs 8, 9, 10 or 11, the Company shall not be required to
          mediate or arbitrate such dispute or claim, but shall have the right
          at its election to institute judicial proceedings in any court of
          competent jurisdiction with respect to such dispute or claim. Also, if
          such judicial proceedings are instituted, the parties agree that such
          proceedings shall not be stayed or delayed pending the outcome of any
          arbitration proceeding hereunder.

     17.3 Without regard to whether the Executive prevails, in whole or in part,
          in connection therewith, the Company will pay and be financially
          responsible for 100% of any and all attorneys' and related fees and
          expenses incurred by the Executive in connection with a dispute
          regarding the payments due under Section 6, provided that, in regard
          to such dispute, the Executive has not acted in bad faith or with no
          colorable claim of success. All such fees and expenses will be paid by
          the Company as incurred by the Executive on a monthly basis upon an
          undertaking by the Executive to repay such advanced amounts if an
          arbitrator or court determines, in a decision against which no appeal
          may be taken or with respect to which the time period to appeal has
          expired, that he/she acted in bad faith or with no colorable claim of
          success.

18.  Successors, No-Assignment

     18.1 This Agreement is binding on and is for the benefit of the parties
          hereto and their respective successors, heirs, executors,
          administrators and other legal representatives. The Company shall
          require any successor to all or a portion of the business and/or
          assets of the Company by purchase, merger, consolidation, acquisition
          of stock or otherwise which is or becomes the employer of the
          Executive to assume and agree to perform this Agreement in the same
          manner and to the same extent as the Company would be required to
          perform if no such succession had taken place, and a failure of any
          such successor to the Company which is or becomes the employer of the
          Executive to assume and agree to perform this Agreement shall be for
          all purposes of this Agreement (including, without limitation,
          Paragraph 6.2 of this Agreement) a termination of this Agreement by
          the Company and such successor.

     18.2 Except as provided in Paragraph 18.1, neither this Agreement nor any
          right or obligation hereunder may be assigned by either party.

19.  SEVERABILITY OF PROVISIONS - If any provision of this Agreement, or portion
     thereof, is

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     so broad in scope or duration so as to be unenforceable, such provision or
     portion thereof shall be interpreted to be only so broad as is enforceable.
     If any one or more provisions contained in this Agreement shall be invalid,
     illegal or unenforceable in any respect, the validity, legality, and
     enforceability of the remaining provisions shall not in any way be affected
     or impaired thereby and this Agreement shall be interpreted as if such
     invalid, illegal, or unenforceable provision was not contained therein.

20.  NO RULE OF STRICT CONSTRUCTION, HEADINGS

     20.1 The language contained in this Agreement shall be deemed to be
          approved by both parties and no rule of strict construction shall be
          applied against either party.

     20.2 The headings used in this Agreement are intended for convenience and
          reference only and will not in any manner amplify, limit, modify or
          otherwise be used in the construction or interpretation of any
          provision of this Agreement. All section references are to sections of
          this Agreement, unless otherwise noted.

21.  CHOICE OF LAW - This Agreement shall be governed by and construed in
     accordance with the laws of the State of Connecticut, USA, without giving
     effect to choice of law provisions.

22.  COUNTERPARTS - This Agreement may be executed in several counterparts, each
     of which shall be deemed an original, but all of which shall constitute one
     and the same instrument.

23.  ENTIRE AGREEMENT - This Agreement constitutes the entire agreement between
     the parties hereto with respect to the Executive's employment by the
     Company, and supersedes, and is in full substitution of, any and all oral
     or written prior understandings, representations, or agreements with
     respect to the Executive's employment with the Company or any affiliate
     unless otherwise indicated herein.

24.  VOLUNTARY AGREEMENT - The parties represent and agree that each has
     reviewed all aspects of this Agreement, has carefully read and fully
     understands all provisions of this Agreement, and is voluntarily entering
     into this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
indicated below.

Dinesh Paliwal                              For ABB Inc.

----------------------------                ----------------------------

Feb. 21, 2003                               2-21-2003
----------------------------                ----------------------------
Date                                        Date

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                                                                    Exhibit 4.10

                                       ABB

Mr. Peter Smits
ABB Ltd
8050 Zurich

Dear Mr. Smits,

This is to confirm the terms and conditions of your employment relationship with
ABB Ltd, Zurich (the "Company") as Division Manager of the Power Technology
Products Division, in the position of an Executive Vice President and member of
the Executive Committee of the ABB Group, effective January 1, 2001.

1.   BASE SALARY. Your base salary will be specified for each year by the Chief
     Executive Officer and communicated to you in writing. The base salary is
     normally revised every second year.

     The base salary includes a representation allowance, as from time to time
     determined by the Chief Executive Officer. The base salary and
     representation allowances are paid in 12 monthly instalments.

2.   INCENTIVE PLAN. In addition to the base salary, an incentive plan is part
     of your compensation. The incentive formula is predominantly based on
     quantitative components, relating to the financial performance of the ABB
     Group.

     The incentive plan is revised annually and the incentive plan parameters
     may be different from one year to another. The applicable incentive for a
     given year will be specified by the Chief Executive Officer and
     communicated to you in writing.

3.   HEALTH INSURANCE. As regards health insurance, you are entitled to a
     private patient insurance (detailed information about this plan is provided
     separately). The Company will pay the insurance premiums. Family members
     are not covered by this health insurance plan.

4.   PENSION AND RELATED BENEFITS. Your retirement pension, disability pension,
     widows pension, child/orphan pension and related benefits are subject to
     the Company's and its pension funds' applicable regulations or to such
     other separate agreement as you and the Company may have entered into or
     may in the future enter into.

5.   VACATION. You are entitled to a vacation of 30 working days per year.

                                     ABB Ltd

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6.   SCHOOL FEES - INTERNATIONAL SCHOOLS. If and to the extent your children are
     eligible under the Company's Corporate Program for International Schools,
     the fees for their school will be covered by the Company.

7.   COMPANY CAR. You are entitled to the use of a Company car according to the
     Company's Car Program as from time to time issued and applicable.

8.   TERMINATION OF EMPLOYMENT RELATIONSHIP. Each party may terminate the
     present employment relationship with effect at the end of any calendar
     month by giving 12 months prior written notice.

     Under termination of the employment relationship, the Company may elect to
     release you forthwith from fulfilling your employment obligations. Such
     release will, however, not affect salary payments payable to you during the
     12-months notice period.

     In case your employment relationship would be terminated by the Company and
     if, after expiry of the 12-month notice period, you would not have taken up
     employment with a third party or commenced an independent, regularly
     remunerated professional activity, the Company may, at its sole discretion,
     continue to pay to you, for a period not exceeding 12 months, a monthly
     compensation in amounts equal to your total monthly salary during your
     employment relationship with the Company.

     Remuneration for the 12 months notice period, as well as for any additional
     period within the discretion of the Company, will, in addition to the base
     salary, include an incentive corresponding to the average incentive (or
     pro-rata average incentive if applicable) for the two years preceding the
     year during which notice of termination is given.

     Retirement in accordance with the applicable regulations or separate
     agreement (if any) will interrupt any notice period and constitute
     termination of your employment relationship with the Company without
     further notice; accordingly, any salary, incentive or other benefits claims
     relating to the period after the date of such termination, will be fully
     substituted by the retirement benefits due pursuant to the said regulations
     or agreement.

9.   NON-COMPETITION. You have agreed, and by counter-signing the present
     Letter-Agreement confirm your agreement, that you shall not, during a
     period of 1 (one) year after the term of your employment relationship with
     the Company, operate on your own account, work for or otherwise be directly
     or indirectly engaged in a business competing with the business activities
     of the ABB Group. No separate compensation will be due by the Company as
     consideration for your observance of this non-competition commitment.

10.  EMPLOYMENT REGULATIONS. The general Employment Regulations as from time to
     time issued and applicable for the Company's employees are an integral part
     of your employment conditions and supplement as to matters not specifically
     addressed in this Letter-Agreement.

11.  PREVIOUS EMPLOYMENT RELATIONSHIPS. Your employment relationship with the
     Company, with the terms and conditions as documented in the present
     Letter-Agreement,

                                       -2-
<Page>

     replaces any previous employment relationships and related items and
     conditions with entities of the ABB Group.

12.  TITLE AND MEMBERSHIP IN THE EXECUTIVE COMMITTEE; OTHER ASSIGNMENTS. It is
     understood and agreed that the title "Executive Vice President" and your
     membership in the Group Executive Committee are not essential parts of your
     employment relationship with the Company and may be changed or terminated
     without notice and without monetary or other compensation by the Company's
     Board of Directors. Also, within such employment relationship, the Chief
     Executive Officer may assign to you areas of responsibility which differ
     from those currently assigned, always provided that such other assignments
     do not constitute a substantial alteration in the scope or dignity of your
     work.

Please confirm your understanding and acceptance of the above terms and
conditions by signing and returning to us a copy of this Letter-Agreement.

Zurich, November 1, 2001

                                     ABB Ltd

/s/ Jorgen Centerman                            /s/ Arne Olsson
--------------------------------------         ---------------------------------
            Jorgen Centerman                              Arne Olsson
 President and Chief Executive Officer            Group Senior Vice President

Accepted:                                       /s/ Peter Smits
                                               ---------------------------------
                                                         Peter Smits

                                       -3-

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