Document:

Exhibit
10.2

 

Tyco International Ltd 

2004 Stock and Incentive Plan (the “Plan”)

 

TERMS
AND CONDITIONS

OF

OPTION
AWARD

 

OPTION AWARD made in Princeton, New Jersey, as
of October 7, 2008 (the “Grant Date”).

 

1.                                       Grant of Option.  Tyco
International Ltd. (the “Company”) has granted you an Option to purchase Shares
of Common Stock of the Company, as described in the grant notification letter issued
to you (“Grant Letter”), subject to the provisions of these Terms and
Conditions.  This Option is a Non-Qualified
Option.

 

2.                                       Exercise Price. 
The purchase price of the Shares covered by the Option is set forth in
your Grant Letter.

 

3.                                       Vesting. 
Except in the event of your Normal Retirement (Termination of Employment
on or after age 60 if the sum of your age and full years of service with the
Company is at least 70), Retirement (Termination of Employment on or after age
55 if the sum of your age and full years of service with the Company is at
least 60), Termination of Employment, Death, Disability or a Change in Control,
the Option will become exercisable in cumulative installments as follows: [·]. 
Your vested right will be calculated on the anniversary of the Grant
Date.  No credit will be given for
periods following Termination of Employment, except as specifically provided
herein.

 

4.                                       Term of Option.  Unless
the Option has been terminated or cancelled on an earlier date, the Option must
be exercised prior to the close of the New York Stock Exchange (“NYSE”) on the
day prior to the 10th anniversary of the Grant
Date.  If the NYSE is not open for
business on the expiration date specified, the Option will expire at the close
of the NYSE’s next business day.

 

5.                                       Payment of Exercise Price. 
You may pay the Exercise Price by cash, certified check, bank draft,
wire transfer or postal or express money order. Alternatively, payment may be
made by one or more of the following methods: (i) delivering to the
Company a properly executed exercise notice, together with irrevocable
instructions to a broker to deliver promptly (within the typical settlement
cycle for the sale of equity securities on the relevant trading market, or
otherwise in accordance with Regulation T issued by the Federal Reserve Board) to
the Company sale or loan proceeds adequate to satisfy the portion of the Exercise
Price being so paid; (ii) if expressly approved by the Board of Directors,
tendering to the Company (by physical delivery or attestation) certificates of
Common Stock that you have held for six (6) months or longer (unless the
Compensation and Human Resources Committee (the “Committee”), in its
discretion, waives this 6-month period) and that have an aggregate Fair Market
Value as of the day prior to the date of exercise equal to the portion of the
Exercise Price being so paid; or (iii) if

 

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such form of payment is
expressly authorized by the Board of Directors or the Committee, instructing
the Company to withhold Shares that would otherwise be issued were the Exercise
Price to be paid in cash and that have an aggregate Fair Market Value as of the
date of exercise equal to the portion of the Exercise Price being so paid.  Notwithstanding the foregoing, you may not
tender any form of payment that the Company determines, in its sole and
absolute discretion, could violate any law or regulation. You are not required
to purchase all Shares subject to the Option at one time, but you must pay the
full Exercise Price for all Shares that you elect to purchase before they will
be delivered.

 

6.                                       Exercise of Option. 
Subject to these Terms and Conditions, the Option may be exercised by
contacting UBS Financial Services Inc. at 877-STK-TYCO (1-877-785-8926) if
calling from within the U.S. or 001-201-272-7611 if calling from outside the
U.S., or such other stock option administrator as is selected by the
Company.  If the Option is exercised
after your death, the Company will deliver Shares only after the Committee has
determined that the person exercising the Option is the duly appointed executor
or administrator of your estate or the person to whom the Option has been
transferred by your will or by the applicable laws of descent and distribution.

 

7.                                       Retirement, Termination of Employment, Disability or Death.  The Option will vest and remain exercisable
as set forth below (or as set forth in paragraph 8, 9 or 10 as applicable), in
the case of Termination of Employment, Retirement, Normal Retirement,
Disability or Death:

 

[·]

 

Termination of Employment means the date of
cessation of an Employee’s employment relationship with the Company or a
subsidiary for any reason, with or without Cause, as determined by the Company.
The Severance & Retention Plan for Headquarters Group Move Program shall
not apply to this Award.

 

8.                                       Change in Control. 
In the event of a Change in Control of Tyco International Ltd., as
defined in the Plan document, and your Change in Control Termination, as also
defined in the Plan document, or a Termination of Employment by reason of a “Good
Reason Resignation” which qualifies you for severance benefits under the Tyco
International Ltd. Change in Control Severance Plan for Certain U. S. Officers
and Executives (the “CIC Severance Plan”) within two (2) years following a
Change in Control, your Option will immediately become fully vested.  Your Option will expire on the earlier of (i) the
original expiration date or (ii) three (3) years from the effective
date of your Change in Control Termination or your Termination of Employment by
reason of a Good Reason Resignation, as described in the preceding sentence.

 

9.                                       Termination of Employment as a
Result of Divestiture or Outsourcing.  Notwithstanding provisions to
the contrary in paragraph 7, if your involuntary Termination of Employment
other than for Cause is as a result of a Disposition of Assets, Disposition of
a Subsidiary or Outsourcing Agreement, your Option Award will vest on a
pro-rata basis based on

 

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(i) the number of whole months completed from
Grant Date through the closing date of the applicable transaction over the
original number of months of the vesting period, times (ii) the total
number of shares awarded under the Option minus (iii) the number of shares
previous vested. The vested portion of your Option Award will expire on the
earlier of the original expiration date of the Award or three (3) years
after the date of your Termination of Employment.

 

Notwithstanding
the foregoing, you shall not be eligible for such pro-rata vesting and extended
expiration date if, (i) your Termination of Employment occurs on or prior
to the closing date of such Disposition of Assets or Disposition of a
Subsidiary, as applicable, or on such later date as is specifically provided in
the applicable transaction agreement or related agreements, or on the effective
date of such Outsourcing Agreement applicable to you (the “Applicable
Employment Date”), and (ii) you are offered Comparable Employment with the
buyer, successor company or outsourcing agent, as applicable, but do not
commence such employment on the Applicable Employment Date.

 

For
purposes of this section 9, (i) “Comparable Employment” is defined as
employment at a base salary rate and bonus target that is at least equal to the
base salary rate and bonus target in effect immediately prior to your
termination of employment and at a location that is no more than 50 miles from
your job location in effect immediately prior to your termination of
employment; (ii) “Disposition of Assets” shall mean the disposition by the
Company or a Subsidiary of all or a portion of the assets used by the Company
or Subsidiary in a trade or business to an unrelated corporation or entity; (iii) “Disposition
of a Subsidiary” shall mean the disposition by the Company or a Subsidiary of
its interest in a subsidiary or controlled entity to an unrelated individual or
entity, provided that such subsidiary or entity ceases to be an affiliated
company as a result of such disposition; and (iv) “Outsourcing Agreement”
shall mean a written agreement between the Company or a Subsidiary and an unrelated
third party (“Outsourcing Agent”) pursuant to which (a) the Company
transfers the performance of services previously performed by employees of the
Company or Subsidiary to the Outsourcing Agent, and (b) the Outsourcing
Agreement includes an obligation of the Outsourcing Agent to offer employment
to any employee whose employment is being terminated as a result of or in
connection with said Outsourcing Agreement.

 

10.                                 Termination of Employment – Executives. 
If (i) your Termination of Employment occurs twelve
months or later after the Grant Date, (ii) upon your Termination of
Employment you are a Section 16 Officer or employed in a job
classification Band 1 or Band 2, and (iii) you are involuntarily
terminated for reasons other than Cause, you will continue to vest in any
portion of your Award that had not vested as of the date of your Termination of
Employment for a period of twelve months following your termination date, and,
the vested portion of your Award will expire on the earlier of (i) the
original expiration date of the Award or (ii) twelve months after the date
of your Termination of Employment or such later date as is applicable under
paragraph 7.  If your Termination of
Employment occurs less than twelve months after the Grant Date your unvested
Options will be forfeited as of your Termination of Employment.

 

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11.                                 Withholdings. 
The Company will have the right, prior to the issuance or delivery of
any Shares in connection with the exercise of the Option, to withhold or demand
from you the amount necessary to satisfy applicable tax requirements, as
determined by the Committee.  The methods
described in paragraph 5 may also be used to pay your withholding tax obligation.

 

12.                                 Transfer of Option. 
You may not transfer the Option or any interest in the Option except by
will or the laws of descent and distribution. 
Notwithstanding the foregoing, you may transfer the Option to members of
your immediate family or to one or more trusts for the benefit of family
members or to one or more partnerships in which the family members are the only
partners, provided that (i) you do not receive any consideration for the
transfer, (ii) you furnish the Committee or its designee with detailed
written notice of the transfer at least three (3) business days in
advance, and (iii) the Committee or its designee consents in writing.  For this purpose, “family member” means any
spouse, children, grandchildren, parents, grandparents, siblings, nieces,
nephews and grandnieces and grandnephews, including adopted, in-laws and step
family members. Any Option transferred pursuant to this provision will continue
to be subject to the same terms and conditions that were applicable to the
Option immediately prior to transfer. 
The Option may be exercised by the transferee only to the same extent
that you could have exercised the Option had no transfer occurred.

 

13.                                 Covenant; Forfeiture of Award;
Agreement to Reimburse Company.

 

(a)                             If you have been terminated for Cause,
including without limitation a termination as a result of your violation of the
Company’s Code of Ethical Conduct, any outstanding vested or unvested stock
options shall be immediately rescinded and you will forfeit any rights you have
with respect to those Options.  In addition,
you hereby agree and promise immediately to deliver to the Company, Shares (or,
in the discretion of the Committee, cash) equal in value to the amount of any
profit you realized upon an exercise of the Option during the period beginning
six (6) months prior to your Termination of Employment and ending on the 6
month anniversary of your Termination of Employment.

 

(b)                            If the Committee determines, in its sole
discretion, that at any time after the Grant Date and prior to the second
anniversary of your Termination of Employment you (i) disclosed business
confidential or proprietary information related to any business of the Company
or Subsidiary or (ii) have entered into an employment or consultation
arrangement (including any arrangement for employment or service as an agent,
partner, stockholder, consultant, officer or director) with any entity or
person engaged in a business and (a) such employment or consultation
arrangement would likely (in the sole judgment of the Committee) result in the
disclosure of business confidential or proprietary information related to any
business of the Company or a Subsidiary to a business that is competitive with
any Company or Subsidiary business as to which you have had access to business
strategic or confidential information, and (b) the Committee has not
approved the arrangement in writing, then any Option that you have not
exercised (whether vested or unvested) will immediately be rescinded, and you
will forfeit any rights you have with respect to these Options as of the date
of the Committee’s determination.

 

14.                                 Adjustments. 
In the event of any stock split, reverse stock split, dividend or other
distribution (whether in the form of cash, Shares, other securities or other
property),

 

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extraordinary cash
dividend, recapitalization, merger, consolidation, split-up, spin-off,
reorganization, combination, repurchase or exchange of Shares or other
securities, the issuance of warrants or other rights to purchase Shares or other
securities, or other similar corporate transaction or event, the Committee shall
adjust the number and kind of Shares covered by the Option, the Exercise Price
and other relevant provisions to the extent necessary to prevent dilution or
enlargement of the benefits or potential benefits intended to be provided by
the Option.  Any such determinations and
adjustments made by the Committee will be binding on all persons.

 

15.                                 Restrictions on Exercise. 
Exercise of the Option is subject to the conditions that, to the extent
required at the time of exercise, (a) the Shares covered by the Option
will be duly listed, upon official notice of issuance, upon the NYSE, and (b) a
Registration Statement under the Securities Act of 1933 with respect to the
Shares will be effective or an exemption from registration will apply.  The Company will not be required to deliver
any Common Stock until all applicable federal and state laws and regulations
have been complied with and all legal matters in connection with the issuance
and delivery of the Shares have been approved by counsel of the Company.  Notwithstanding this Statement of Terms and
Conditions, Optionee may exercise the Option only pursuant to the “broker-assisted
cashless exercise” method described in Section 5(i) of this Statement
of Terms and conditions if so restricted by local law at the time of exercise.

 

16.                                 Disposition of Securities. 
By accepting the Award, you acknowledge that you have read and
understand the Company’s Insider Trading Policy, and are aware of and
understand your obligations under federal securities laws with respect to
trading in the Company’s securities, and you agree not to use the Company’s “cashless
exercise” program (or any successor program) at any time when you possess
material nonpublic information with respect to the Company or when using the
program would otherwise result in a violation of securities law.  The Company will have the right to recover,
or receive reimbursement for, any compensation or profit realized on the
exercise of the Option or by the disposition of Shares received upon exercise
of the Option to the extent that the Company has a right of recovery or
reimbursement under applicable securities laws.

 

17.                                 Plan Terms Govern. 
The exercise of the Option, the disposition of any Shares received upon
exercise of the Option, and the treatment of any gain on the disposition of
these Shares are subject to the terms of the Plan and any rules that the
Committee may prescribe.  The Plan
document, as may be amended from time to time, is incorporated into these Terms
and Conditions.  Capitalized terms used
in these Terms and Conditions have the meaning set forth in the Plan, unless
otherwise stated in these Terms and Conditions. 
In the event of any conflict between the terms of the Plan and the terms
of these Terms and Conditions, the Plan will control.  By accepting the Award, you acknowledge
receipt of the Plan, as in effect on the date of these Terms and Conditions.

 

18.                                 Personal Data. 
To comply with applicable law and to administer the Plan and these Terms
and Conditions properly, the Company and its agents may hold and process your
personal data and/or sensitive personal data. 
Such data includes, but is not limited to, the information provided in
this grant package and any changes thereto, other appropriate personal and
financial data about you, and information about your participation in the Plan
and Shares obtained under the Plan from time to time.  By accepting the Award, you hereby give your

 

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explicit consent to the
Company’s processing any such personal data and/or sensitive personal
data.  You also hereby give your explicit
consent to the Company’s transfer of any such personal data and/or sensitive
personal data outside the country in which you work or reside and to the United
States.  The legal persons for whom your
personal data are intended include the Company and any of its Subsidiaries (or
former Subsidiaries as are deemed necessary), the outside Plan administrator as
selected by the Company from time to time, and any other person that the
Company may find in its administration of the Plan to be appropriate.  You have the right to review and correct your
personal data by contacting your local Human Resources Representative.  You understand that the transfer of the
information outlined here is important to the administration of the Plan, and
that failure to consent to the transmission of such information may limit or
prohibit your participation in the Plan.

 

19.                                 No Contract of Employment or
Promise of Future Grants.  By accepting the Award, you agree to be bound
by these Terms and Conditions and acknowledge that the Award is granted at the
sole discretion of the Company and is not considered part of any contract of
employment with the Company or of your ordinary or expected salary or other
compensation and will not be considered as part of such salary or compensation
for purposes of any pension benefits or in the event of severance, redundancy
or resignation.  If your employment with
the Company or a Subsidiary is terminated for any reason, whether lawfully or
unlawfully, you agree that you will not be entitled by way of damages for
breach of contract, dismissal or compensation for loss of office or otherwise
to any sum, shares or other benefits to compensate you for the loss or
diminution in value of any actual or prospective rights, benefits or
expectation under or in relation to the Plan.

 

20.                                 Limitations. 
Nothing in these Terms and Conditions or the Plan gives you any right to
continue in the employ of the Company or any of its Subsidiaries or to
interfere in any way with the right of the Company or any Subsidiary to
terminate your employment at any time. 
Payment of Shares is not secured by a trust, insurance contract or other
funding medium, and you do not have any interest in any fund or specific asset
of the Company by reason of the Option. 
You have no rights as a stockholder of the Company pursuant to the
Option until Shares are actually delivered you.

 

21.                                 Incorporation of Other
Agreements.  These Terms and Conditions and the Plan
constitute the entire understanding between you and the Company regarding the
Option.  These Terms and Conditions
supercede any prior agreements, commitments or negotiations concerning the
Option.

 

22.                                 Severability. 
The invalidity or unenforceability of any provision of these Terms and
Conditions will not affect the validity or enforceability of the other
provisions of these Terms and Conditions, which will remain in full force and
effect.  Moreover, if any provision is
found to be excessively broad in duration, scope or covered activity, the
provision will be construed so as to be enforceable to the maximum extent
compatible with applicable law.

 

23.                                 Compliance
with Section 409A.  Payments under
the Plan may be subject to Section 409A of the Internal Revenue Code. The
Committee may make such modifications to these Terms and Conditions as it deems
necessary or appropriate to comply with Section 409A.

 

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By accepting this
Award, you agree to the following:

 

(i)                                     you have carefully read, fully
understand and agree to all of the terms and conditions described in these
Terms and Conditions and the Plan; and

 

(ii)                                  you understand and agree that these
Terms and Conditions and the Plan constitute the entire understanding between
you and the Company regarding the Option, and that any prior agreements,
commitments or negotiations concerning the Option are replaced and superseded.

 

You will be deemed to
consent to the application of the terms and conditions set forth in these Terms
and Conditions and the Plan unless you contact Tyco International Ltd., c/o
Equity Plan Administration, 9 Roszel Road, Princeton, NJ 08540 in writing
within thirty (30) days of the date of these Terms and Conditions.  Notification of your non-consent will nullify
this grant unless otherwise agreed to in writing by you and the Company.

 

 

	
   

  	
   

  
	
   

  	
  [·]

  

 

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Tyco International Ltd.

2004 Stock and Incentive Plan (the “Plan”)

 

TERMS AND CONDITIONS

OF

PERFORMANCE SHARE UNIT AWARD

 

PERFORMANCE SHARE
UNIT AWARD made in Princeton, New Jersey, as of October 7, 2008 (“Grant
Date”).

 

1.                                       Grant
of Award.  Tyco International Ltd. (“the
Company”) has granted you Performance Share Units, as described in the grant
notification letter issued to you (“Grant Letter”), subject to the provisions
of these Terms and Conditions.  The
Company will hold the Performance Share Units in a bookkeeping account on your
behalf until they become payable or are forfeited or cancelled.

 

2.                                       Payment
Amount.  Each Performance Share Unit
represents one (1) Share of Common Stock.

 

3.                                       Form of
Payment.  Your vested Performance Share
Unit Award, determined in accordance with Section 4, will be redeemed
solely for Shares, subject to Section 14.

 

4.                                       (a) Vesting.  Subject to Section 4(b), your
Performance Share Unit Award willfully vest at the end of the performance cycle,
as described in Appendix A, if you are then an active employee. Any payment
shall be made as soon as practicable following the end of the performance
cycle.

 

(b) 
Award Adjustment.  The
target number of Performance Share Units specified in your Grant Letter shall
be adjusted at the end of the performance cycle based on the level of
attainment of the performance metrics and satisfaction of the other terms and
conditions described in Appendix A.  Such
adjustment shall range from 0% to 200% of the target award set forth in your Grant
Letter.  The determination of the
attainment of the performance metrics and satisfaction of any other applicable
terms and conditions will be made at the sole discretion of the Committee.

 

5.                                       Termination
of Employment.  Any Performance Share Units
that have not been earned as of your Termination of Employment pursuant to
paragraphs 6 through 10 will immediately be forfeited, and your rights with
respect to these Performance Share Units will end. Termination of Employment means the date
of cessation of an Employee’s employment relationship with the Company or a
subsidiary for any reason, with or without Cause, as determined by the Company.

 

 

6.                                       Death
or Disability.  If your employment with the
Company terminates because of your Death or Disability, you will earn a pro
rata portion of your Award, if any, determined in accordance with Section 4
above, based on the number of full months you have completed in the performance
period applicable to the Award. Any payment shall be made as soon as
practicable following the end of the performance cycle.

 

If you are deceased,
the Company will make the payment, if any, to your estate only after the
Committee has determined that the payee is the duly appointed executor or
administrator of your estate.

 

7.                                       Retirement.  For purposes of this Section 7, “Retirement”
means Termination of Employment on or after age 55 if the sum of your age and
full years of service with the Company is at least 60, and “Normal Retirement”
means Termination of Employment on or after age 60 if the sum of your age and
full years of service with the Company is at least 70.  If your employment with the Company
terminates because of your Retirement or Normal Retirement less than 12 months
after the Grant Date, your Performance Share Units will immediately be forfeited
and your rights with respect to such Units will end.  If your employment with the Company
terminates because of your Retirement twelve or more months after the Grant
Date, you will earn a pro rata portion of your Award, if any, determined in
accordance with Section 4 above, based on the number of full months you
have completed in the performance cycle applicable to the Award. If your
employment with the Company terminates because of your Normal Retirement twelve
or more months after the Grant Date, your Award will be determined in
accordance with Section 4 above, as if you had continued active employment
through the end of the performance cycle applicable to the Award. Any payment
shall be made as soon as practicable following the end of the performance cycle.

 

8.                                       Change
in Control.  In the event of a Change in
Control of Tyco International Ltd, as defined in the Plan document, unless
otherwise provided in this Section 8, the terms and conditions applicable
to your Award under this Agreement shall continue in effect, except that no
adjustment shall be made under Section 4(b) and the Retirement
provisions of Section 7 shall not apply. 
Notwithstanding the preceding sentence, your Award shall vest and become
immediately payable upon a Change in Control Termination, as defined in the
Plan document, or a Termination of Employment by reason of a “Good Reason
Resignation” which qualifies you for severance benefits under the Tyco
International Ltd. Change in Control Severance Plan for Certain U. S. Officers
and Executives (the “CIC Severance Plan”). 
Any Award payable pursuant to the preceding sentence shall be paid at the
target number of Performance Share Units specified in your Grant Letter as soon
as practicable following your Change in Control Termination or Good Reason
Resignation upon a Change in Control . 
If prior to the Change in Control, you had satisfied the Retirement
provisions of Section 7 and terminated your employment because of your
Retirement or Normal Retirement, or previously terminated employment as a
result of Death or Disability as described in Section 6, your Award (as
determined under Sections 6 and 7) shall be paid to you as soon as practicable
following the Change in Control and no adjustment shall be made under Section 4(b).

 

9.                                       Termination
of Employment as a Result of Divestiture or Outsourcing.  If your involuntary Termination of Employment
other than for Cause is a result of a Disposition of Assets, Disposition of a
Subsidiary or Outsourcing Agreement, you will earn a pro rata portion 

 

2

 

of
your Award, if any, as is determined in accordance with Section 4 above,
based on the number of full months you have completed in the performance cycle
applicable to the Award through the closing date of the applicable transaction. Any payment shall be made as soon as
practicable following the end of the performance cycle.

 

Notwithstanding the foregoing, you shall not earn any
portion of your Award in accordance with the preceding paragraph if (i) your
Termination of Employment occurs on or prior to the closing date of such
Disposition of Assets or Disposition of a Subsidiary, as applicable, or on such
later date as is specifically provided in the applicable transaction agreement,
or on the effective date of such Outsourcing Agreement applicable to you, and (ii) you
are offered Comparable Employment with the buyer, successor company or
outsourcing agent, as applicable, but do not commence such employment on the
Applicable Employment Date.

 

For the purposes of this Section 9, (a) “Comparable
Employment” is defined as employment at a base salary rate and bonus target
that is at least equal to the base salary rate and bonus target in effect
immediately prior to your termination of employment and at a location that is
no more than 50 miles from your job location in effect immediately prior to
your termination of employment; (b) “Disposition of Assets” shall mean the
disposition by the Company or a Subsidiary of all or a portion of the assets
used by the Company or Subsidiary in a trade or business to an unrelated
corporation or entity;  (c) “Disposition
of a Subsidiary” shall mean the disposition by the Company or a Subsidiary of
its interest in a subsidiary or controlled entity to an unrelated individual or
entity, provided that such subsidiary or entity ceases to be an affiliated
company as a result of such disposition; and (d) “Outsourcing Agreement”
shall mean a written agreement between the Company or a Subsidiary and an
unrelated third party (“Outsourcing Agent”) pursuant to which (i) the
Company transfers the performance of services previously performed by employees
of the Company or Subsidiary to the Outsourcing Agent, and (ii) the
Outsourcing Agreement includes an obligation of the Outsourcing Agent to offer
employment to any employee whose employment is being terminated as a result of
or in connection with said Outsourcing Agreement.

 

10.                                 Termination
of Employment with Severance Benefits.  If your
Termination of Employment (i) occurs twelve months or more after the Grant
Date, (ii) is for a reason other than individual performance and (iii) you
are eligible to receive severance benefits under a severance plan maintained by
the Company or a Subsidiary or an employment agreement your Award will immediately
be forfeited and your rights with respect to these Performance Share Units will
end; unless the severance plan or agreement expressly provides that you may earn
a pro rata portion your Award, if any, determined in accordance with Section 4
above, based on the number of full months you have completed in the performance
period applicable to the Award. Any payment shall be made as soon as
practicable following the end of the performance cycle. Notwithstanding the
foregoing, the Severance &
Retention Plan for Headquarters Group Move Program shall not apply to this
Award.

 

11.                                 Withholdings.  The Company will have the right, prior to any
issuance or delivery of Shares based on your Performance Share Units, to
withhold or require from you the amount necessary to satisfy applicable tax
requirements, as determined by the Committee. 
If you 

 

3

 

have
not satisfied your tax withholding requirements in a timely manner, the Company
will have the right to sell the number of Shares necessary to satisfy such
requirements.

 

12.                                 Transfer
of Award.  You may not transfer any
interest in Performance Share Units except by will or the laws of descent and
distribution.  Any other attempt to
dispose of your interest in Performance Share Units will be null and void.

 

13.                                 Covenant;
Forfeiture of Award; Agreement to Reimburse Company.

 

(a)                             If you have
been terminated for Cause, including without limitation a termination as a
result of your violation of the Company’s Code of Ethical Conduct, any unearned
Performance Share Units shall be immediately rescinded and you will forfeit any
rights you have with respect to such Units. In addition, you hereby agree and
promise immediately to deliver to the Company the number of Shares (or, in the discretion
of the Committee, the cash value of said shares) you received for Performance
Share Units during the period beginning six (6) months prior to your
Termination of Employment and ending on the second anniversary of your
Termination of Employment.

 

(b)                            If the
Committee determines, in its sole discretion, that at any time after the Grant
Date and prior to the second anniversary of your Termination of Employment you (1) disclosed
business confidential or proprietary information related to any business of the
Company or Subsidiary or (2) have entered into an employment or
consultation arrangement (including any arrangement for employment or service
as an agent, partner, stockholder, consultant, officer or director) with any
entity or person engaged in a business and (a) such employment or
consultation arrangement would likely (in the sole judgment of the Committee)
result in the disclosure of business confidential or proprietary information
related to any business of the Company or a Subsidiary to a business that is
competitive with any Company or Subsidiary business as to which you have had
access to business strategic or confidential information, and (b) the
Committee has not approved the arrangement in writing, any unearned Performance
Share Units will immediately be rescinded, and you will forfeit any rights you
have with respect to these Performance Share Units as of the date of the
Committee’s determination.

 

14.                                 Adjustments.  In the event of any stock split, reverse
stock split, dividend or other distribution (whether in the form of cash,
Shares, other securities or other property), extraordinary cash dividend,
recapitalization, merger, consolidation, split-up, spin-off, reorganization,
combination, repurchase or exchange of Shares or other securities, the issuance
of warrants or other rights to purchase Shares or other securities, or other
similar corporate transaction or event, the Committee shall adjust the number
and kind of Shares covered by the Performance Share Units and other relevant
provisions to the extent necessary to prevent dilution or enlargement of the
benefits or potential benefits intended to be provided by the Performance Share
Units.  Any such determinations and
adjustments made by the Committee will be binding on all persons.

 

15.                                 Restrictions
on Payment of Shares.  Payment
of Shares for your Performance Share Units is subject to the conditions that,
to the extent required at the time of vesting, (a) the Shares underlying
the Performance Share Units will be duly listed, upon official notice of
redemption, upon the NYSE, and (b) a Registration Statement under the
Securities Act of 1933 

 

4

 

with
respect to the Shares will be effective. 
The Company will not be required to deliver any Common Stock until all
applicable federal and state laws and regulations have been complied with and
all legal matters in connection with the issuance and delivery of the Shares
have been approved by counsel of the Company.

 

16.                                 Disposition
of Securities.  By accepting the Award, you
acknowledge that you have read and understand the Company’s policy, and are
aware of and understand your obligations under federal securities laws in
respect of trading in the Company’s securities. 
The Company will have the right to recover, or receive reimbursement
for, any compensation or profit realized on the disposition of Shares received
for Performance Share Units to the extent that the Company has a right of
recovery or reimbursement under applicable securities laws.

 

17.                                 Plan
Terms Govern.  The redemption of Performance
Share Units, the disposition of any Shares received for Performance Share
Units, and the treatment of any gain on the disposition of these Shares are
subject to the terms of the Plan and any rules that the Committee may
prescribe.  The Plan document, as may be
amended from time to time, is incorporated into these Terms and
Conditions.  Capitalized terms used in
these Terms and Conditions have the meaning set forth in the Plan, unless
otherwise stated in these Terms and Conditions. 
In the event of any conflict between the terms of the Plan and the terms
of these Terms and Conditions, the Plan will control.  By accepting the Award, you acknowledge
receipt of the Plan and the prospectus, as in effect on the date of these Terms
and Conditions.

 

18.                                 Personal
Data.  To comply with applicable law
and to administer the Plan and these Terms and Conditions properly, the Company
and its agents may hold and process your personal data and/or sensitive
personal data.  Such data includes, but
is not limited to, the information provided in this grant package and any
changes thereto, other appropriate personal and financial data about you, and
information about your participation in the Plan and Shares obtained under the
Plan from time to time.  By accepting the
Award, you hereby give your explicit consent to the Company’s processing any
such personal data and/or sensitive personal data.  You also hereby give your explicit consent to
the Company’s transfer of any such personal data and/or sensitive personal data
outside the country in which you work or reside and to the United States.  The legal persons for whom your personal data
are intended include the Company and any of its Subsidiaries, the outside Plan
administrator as selected by the Company from time to time, and any other
person that the Company may find in its administration of the Plan to be
appropriate.  You have the right to
review and correct your personal data by contacting your local Human Resources
Representative.  You understand that the
transfer of the information outlined here is important to the administration of
the Plan, and that failure to consent to the transmission of such information
may limit or prohibit your participation in the Plan.

 

19.                                 No
Contract of Employment or Promise of Future Grants.  By accepting the Award, you agree to be bound
by these Terms and Conditions and acknowledge that the Award is granted at the
sole discretion of the Company and is not considered part of any contract of
employment with the Company or of your ordinary or expected salary or other
compensation and will not be considered as part of such salary or compensation
for purposes of any pension benefits or in the event of severance, redundancy
or resignation.  If your employment with
the Company or a Subsidiary is terminated for any reason, whether lawfully or
unlawfully, you agree that you will not be entitled by way of damages for
breach of contract, dismissal or 

 

5

 

compensation
for loss of office or otherwise to any sum, shares or other benefits to
compensate you for the loss or diminution in value of any actual or prospective
rights, benefits or expectation under or in relation to the Plan.

 

20.                                 Limitations.  Nothing in these Terms and Conditions or the
Plan gives you any right to continue in the employ of the Company or any of its
Subsidiaries or to interfere in any way with the right of the Company or any
Subsidiary to terminate your employment at any time.  Payment of your Performance Share Units is
not secured by a trust, insurance contract or other funding medium, and you do
not have any interest in any fund or specific asset of the Company by reason of
this Award or the account established on your behalf.  You have no rights as a stockholder of the
Company pursuant to the Performance Share Units until Shares are actually
delivered to you.

 

21.                                 Incorporation
of Other Agreements.  These
Terms and Conditions (including Appendix A) and the Plan constitute the entire
understanding between you and the Company regarding the Performance Share
Units.  These Terms and Conditions
supersede any prior agreements, commitments or negotiations concerning the
Performance Share Units.

 

22.                                 Severability.  The invalidity or unenforceability of any
provision of these Terms and Conditions will not affect the validity or
enforceability of the other provisions of the Agreement, which will remain in
full force and effect.  Moreover, if any
provision is found to be excessively broad in duration, scope or covered
activity, the provision will be construed so as to be enforceable to the
maximum extent compatible with applicable law.

 

23.                                 Compliance
with Section 409A.  Payments under
the Plan may be subject to Section 409A of the Internal Revenue Code. The
Committee may make such modifications to these Terms and Conditions as it deems
necessary or appropriate to comply with Section 409A.

 

By
accepting this Award, you agree to the following:

 

(i)                                     you have
carefully read, fully understand and agree to all of the terms and conditions
described in these Terms and Conditions and the Plan; and

 

(ii)                                  you understand
and agree that these Terms and Conditions and the Plan constitute the entire
understanding between you and the Company regarding the Award, and that any
prior agreements, commitments or negotiations concerning the Performance Share
Units are replaced and superseded.

 

You
will be deemed to consent to the application of the terms and conditions set
forth in these Terms and Conditions and the Plan unless you contact Tyco
International Ltd., c/o Equity Plan Administration, 9 Roszel Road, Princeton,
NJ 08540 in writing within thirty (30) days of the date of these Terms and
Conditions.  Notification of your
non-consent will nullify this grant unless otherwise agreed to in writing by
you and the Company.

 

6

 

	
   

  	
   

  
	
   

  	
  [·]

  

 

7

 

Tyco International Ltd.

2004 Stock and Incentive Plan (the “Plan”)

 

TERMS
AND CONDITIONS

OF

RESTRICTED
UNIT AWARD

 

RESTRICTED UNIT AWARD made in Princeton, New
Jersey, as of October 7, 2008 (the “Grant Date”).

 

1.                                       Grant of Award.  Tyco
International Ltd. (the “Company) has granted you Restricted Units, as
described in the grant notification letter that was issued to you (“Grant
Letter”), subject to the provisions of these Terms and Conditions.  The Company will hold the Restricted Units in
a bookkeeping account on your behalf until they become payable or are forfeited
or cancelled.

 

2.                                       Payment Amount. 
Each Restricted Unit represents one (1) Share of Common Stock.

 

3.                                       Form of Payment. 
Vested Restricted Units will be redeemed solely for Shares, subject to Section 14.

 

4.                                       Dividends. 
Restricted Units are a promise to deliver Common Stock upon
vesting.  For each Restricted Unit that
is unvested, you will be credited with a Dividend Equivalent Unit (DEU) for any
cash or stock dividends distributed by the Company on Company Common Stock.  DEUs will be calculated at the same dividend
rate paid to other holders of Common Stock. 
DEUs will vest in accordance with the vesting schedule applicable to the
underlying Units and shall be payable at the same time that the underlying
units are payable as provided herein.

 

5.                                       Vesting. 
Except in the event of your Normal Retirement (Termination of Employment
on or after age 60 if the sum of your age and full years of service with the
Company is at least 70), Retirement (Termination of Employment on or after age
55 if the sum of your age and full years of service with the Company is at
least 60), Termination of Employment, Death or Disability or a Change in
Control, your Restricted Units will vest in installments as follows: [·]. Your vested right will be calculated
on the anniversary of the Grant Date.  No
credit will be given for periods following Termination of Employment, except as
specifically provided herein. Except as otherwise provided in these Terms and
Conditions, any payment shall be made to you as soon as practicable following
the vesting date set forth in this paragraph 5.

 

6.                                       Termination of Employment. 
Any Restricted Units that have not vested as of your Termination of
Employment pursuant to paragraphs 7, 8, 9 and 10 will immediately be forfeited,
and your rights with respect to such Units will end. Termination of Employment
means the date of cessation of an Employee’s employment relationship with the
Company or a 

 

1

 

subsidiary for any
reason, with or without Cause, as determined by the Company. The Severance &
Retention Plan for Headquarters Group Move Program shall not apply to this
Award.

 

7.                                       Death or Disability.  If
your Termination of Employment is a result of your Death or Disability, your
Award will become fully vested as of your Termination of Employment.  Any payment shall be made to you as soon as
practicable following your Termination of Employment.  If
you are deceased, the Company will make a payment to your estate only after the
Committee has determined that the payee is the duly appointed executor or
administrator of your estate.

 

8.                                       Retirement.  If
your Termination of Employment is a result of your Retirement or Normal
Retirement (as defined in paragraph 5) less than twelve months after the Grant
Date, your Restricted Units will immediately be forfeited and your
rights with respect to such Units will end. If your Termination of Employment is a result of your Retirement twelve
or more months after the Grant Date, your Restricted Units will vest pro rata
(in full year increments) based on (i) the number of whole years that you have completed from
Grant Date through your Date of Termination over the original number of years
of the vesting period, times (ii) the total number of shares awarded under
the Grant minus (iii) the number of shares previously vested.  If
your Termination of Employment is a result of your Normal Retirement your
Restricted Units will immediately become fully vested. Any payment shall be made
to you as soon as practicable following your Termination of Employment
(adjusted to reflect any payments previously made to you under paragraph 5).

 

9.                                       Change in Control. 
In the event of a Change in Control of Tyco International Ltd., as
defined in the Plan document, and your Change in Control Termination, as also
defined in the Plan document, or a Termination of Employment by reason of a “Good
Reason Resignation” which qualifies you for severance benefits under the Tyco
International Change in Control Severance Plan for Certain U. S. Officers and
Executives (the “CIC Severance Plan”) within two (2) years following a
Change in Control, Restricted Units will immediately become fully vested and
payment shall be made as soon as practicable following such Change in Control Termination
or Good Reason Resignation.

 

10.                                 Termination of Employment as a
Result of Divestiture or Outsourcing.  If your involuntary Termination
of Employment other than for Cause is as a result of a Disposition of Assets,
Disposition of a Subsidiary or Outsourcing Agreement, your Restricted Unit
Award will vest pro rata (in full-month increments) based on (i) the
number of whole months that you
have completed from Grant Date through the closing date of the
applicable transaction over the original number of months of the vesting
period, times (ii) the total number of shares awarded under the Grant
minus (iii) the number of shares previously vested.  Any
payment shall be made to you as soon as practicable following the date you
vest.

 

Notwithstanding
the foregoing, you shall not be eligible for such pro-rata vesting if, (i) your
Termination of Employment occurs on or prior to the closing date of such
Disposition of Assets or Disposition of a Subsidiary, as applicable, or on such
later date as is specifically provided in the applicable transaction agreement
or related agreements, or on the effective date of such Outsourcing Agreement
applicable to you (the “Applicable Employment Date”), and (ii) 

 

2

 

you are offered Comparable Employment with the buyer,
successor company or outsourcing agent, as applicable, but do not commence such
employment on the Applicable Employment Date.

 

For
the purposes of this Section 10, (a) “Comparable Employment” shall mean
employment at a base salary rate and bonus target that is at least equal to the
base salary rate and bonus target in effect immediately prior to your
termination of employment and at a location that is no more than 50 miles from
your job location in effect immediately prior to your termination of
employment; (b) “Disposition of Assets” shall mean the disposition by the
Company or a Subsidiary of all or a portion of the assets used by the Company
or Subsidiary in a trade or business to an unrelated corporation or
entity;  (c) “Disposition of a
Subsidiary” shall mean the disposition by the Company or a Subsidiary of its
interest in a subsidiary or controlled entity to an unrelated individual or
entity, provided that such subsidiary or entity ceases to be an affiliated
company as a result of such disposition; and (d) “Outsourcing Agreement”
shall mean a written agreement between the Company or a Subsidiary and an
unrelated third party (“Outsourcing Agent”) pursuant to which the Company
transfers the performance of services previously performed by employees of the
Company or Subsidiary to the Outsourcing Agent, and the Outsourcing Agreement
includes an obligation of the Outsourcing Agent to offer employment to any
employee whose employment is being terminated as a result of or in connection
with said Outsourcing Agreement.

 

11.                                 Withholdings; Tax Recovery. 
The Company will have the right, prior to any issuance or delivery of
Shares on your Restricted Units, to withhold or require from you the amount
necessary to satisfy applicable tax requirements, as determined by the
Committee.  If you have not satisfied
your tax withholding requirements in a timely manner, the Company will have the
right to sell the number of Shares necessary to satisfy such requirements. In
addition, the Company shall have the right, if so provided under local law, to
recover any taxes relating to this Award that the Company or any affiliate pays
on your behalf.

 

12.                                 Transfer of Award. 
You may not transfer any interest in Restricted Units except by will or
the laws of descent and distribution. 
Any other attempt to dispose of your interest in Restricted Units will
be null and void.

 

13.                                 Covenant; Forfeiture of Award;
Agreement to Reimburse Company.

 

(a)                             If you have been terminated for Cause,
including without limitation a termination as a result of your violation of the
Company’s Code of Ethical Conduct, any unvested Restricted Units shall be
immediately rescinded and you will forfeit any rights you have with respect to such
Units. In addition, you hereby agree and promise immediately to deliver to the
Company the number of Shares (or, in the discretion of the Committee, the cash
value of said shares) you received for Restricted Units that vested during the
period beginning six (6) months prior to your Termination of Employment
and ending on the 6 month anniversary of your Termination of Employment.

 

(b)                            If the Committee determines, in its sole
discretion, that at any time after the Grant Date and prior to the second
anniversary of your Termination of Employment you (1) disclosed business
confidential or proprietary information related to any business of the 

 

3

 

Company or Subsidiary
or (2) have entered into an employment or consultation arrangement
(including any arrangement for employment or service as an agent, partner,
stockholder, consultant, officer or director) with any entity or person engaged
in a business and (a) such employment or consultation arrangement would
likely (in the sole judgment of the Committee) result in the disclosure of
business confidential or proprietary information related to any business of the
Company or a Subsidiary to a business that is competitive with any Company or
Subsidiary business as to which you have had access to business strategic or
confidential information, and (b) the Committee has not approved the
arrangement in writing, any unvested Restricted Unit will immediately be
rescinded, and you will forfeit any rights you have with respect to these
Restricted Units as of the date of the Committee’s determination.

 

14.                                 Adjustments. 
In the event of any stock split, reverse stock split, dividend or other
distribution (whether in the form of cash, Shares, other securities or other
property), extraordinary cash dividend, recapitalization, merger,
consolidation, split-up, spin-off, reorganization, combination, repurchase or
exchange of Shares or other securities, the issuance of warrants or other
rights to purchase Shares or other securities, or other similar corporate
transaction or event, the Committee shall adjust the number and kind of Shares
covered by the Restricted Units and other relevant provisions to the extent
necessary to prevent dilution or enlargement of the benefits or potential
benefits intended to be provided by the Restricted Units.  Any such determinations and adjustments made
by the Committee will be binding on all persons.

 

15.                                 Restrictions on Payment of
Shares.  Payment of Shares for your Restricted Units
is subject to the conditions that, to the extent required at the time of delivery,
(a) the Shares underlying the Restricted Units will be duly listed, upon
official notice of redemption, upon the NYSE, and (b) a Registration
Statement under the Securities Act of 1933 with respect to the Shares will be
effective.  The Company will not be
required to deliver any Common Stock until all applicable federal and state
laws and regulations have been complied with and all legal matters in
connection with the issuance and delivery of the Shares have been approved by
counsel of the Company.

 

16.                                 Disposition of Securities. 
By accepting the Award, you acknowledge that you have read and
understand the Company’s policy, and are aware of and understand your
obligations under federal securities laws in respect of trading in the Company’s
securities.  The Company will have the
right to recover, or receive reimbursement for, any compensation or profit
realized on the disposition of Shares received for Restricted Units to the
extent that the Company has a right of recovery or reimbursement under
applicable securities laws.

 

17.                                 Plan Terms Govern. 
The redemption of Restricted Units, the disposition of any Shares
received for Restricted Units, and the treatment of any gain on the disposition
of these Shares are subject to the terms of the Plan and any rules that
the Committee may prescribe.  The Plan
document, as may be amended from time to time, is incorporated into these Terms
and Conditions.  Capitalized terms used
in these Terms and Conditions have the meaning set forth in the Plan, unless
otherwise stated in these Terms and Conditions. 
In the event of any conflict between the terms of the Plan and the terms
of these Terms and Conditions, the Plan will control.  By accepting the Award, you acknowledge
receipt of the Plan and the prospectus, as in effect on the date of these Terms
and Conditions.

 

4

 

18.                                 Personal Data. 
To comply with applicable law and to administer the Plan and these Terms
and Conditions properly, the Company and its agents may hold and process your
personal data and/or sensitive personal data. 
Such data includes, but is not limited to, the information provided in
this grant package and any changes thereto, other appropriate personal and
financial data about you, and information about your participation in the Plan
and Shares obtained under the Plan from time to time.  By accepting the Award, you hereby give your
explicit consent to the Company’s processing any such personal data and/or
sensitive personal data.  You also hereby
give your explicit consent to the Company’s transfer of any such personal data
and/or sensitive personal data outside the country in which you work or reside
and to the United States.  The legal
persons for whom your personal data are intended include the Company and any of
its Subsidiaries (or former Subsidiaries as are deemed necessary), the outside
Plan administrator as selected by the Company from time to time, and any other
person that the Company may find in its administration of the Plan to be
appropriate.  You have the right to
review and correct your personal data by contacting your local Human Resources
Representative.  You understand that the
transfer of the information outlined here is important to the administration of
the Plan, and that failure to consent to the transmission of such information
may limit or prohibit your participation in the Plan.

 

19.                                 No Contract of Employment or
Promise of Future Grants.  By accepting the Award, you agree to be bound
by these Terms and Conditions and acknowledge that the Award is granted at the
sole discretion of the Company and is not considered part of any contract of
employment with the Company or of your ordinary or expected salary or other
compensation and will not be considered as part of such salary or compensation
for purposes of any pension benefits or in the event of severance, redundancy
or resignation.  If your employment with
the Company or a Subsidiary is terminated for any reason, whether lawfully or
unlawfully, you agree that you will not be entitled by way of damages for
breach of contract, dismissal or compensation for loss of office or otherwise
to any sum, shares or other benefits to compensate you for the loss or
diminution in value of any actual or prospective rights, benefits or
expectation under or in relation to the Plan.

 

20.                                 Limitations. 
Nothing in these Terms and Conditions or the Plan gives you any right to
continue in the employ of the Company or any of its Subsidiaries or to
interfere in any way with the right of the Company or any Subsidiary to
terminate your employment at any time. 
Payment of your Restricted Units is not secured by a trust, insurance
contract or other funding medium, and you do not have any interest in any fund
or specific asset of the Company by reason of this Award or the account
established on your behalf.  You have no
rights as a stockholder of the Company pursuant to the Restricted Units until
Shares are actually delivered to you.

 

21.                                 Incorporation of Other
Agreements.  These Terms and Conditions and the Plan
constitute the entire understanding between you and the Company regarding the
Restricted Units.  These Terms and
Conditions supercede any prior agreements, commitments or negotiations concerning
the Restricted Units.

 

22.                                 Severability. 
The invalidity or unenforceability of any provision of these Terms and
Conditions will not affect the validity or enforceability of the other
provisions of the Agreement, which will remain in full force and effect.  Moreover, if any provision is found to be 

 

5

 

excessively broad in
duration, scope or covered activity, the provision will be construed so as to
be enforceable to the maximum extent compatible with applicable law.

 

23.                                 Delayed
Payment.  Notwithstanding
anything in these Terms and Conditions to the contrary, if the Company
determines that you are a “specified employee” within the meaning of section
409A(a)(2)(B) of the United States Internal Revenue Code and the
regulations thereunder, and you become entitled to payment of Restricted Units
on account of your Termination of Employment, such payment shall be delayed
until six (6) months following your Termination of Employment if the
Company reasonable determines that your Award is subject to the provisions of Section 409A
of the United States Internal Revenue Code and the regulations thereunder.  Your Award shall continue to be credited with
Dividend Equivalent Units during any such six (6) month delay period.

 

24.                                 Compliance
with Section 409A.  Payments under
the Plan may be subject to Section 409A of the Internal Revenue Code. The
Committee may make such modifications to these Terms and Conditions as it deems
necessary or appropriate to comply with Section 409A.

 

By accepting this
Award, you agree to the following:

 

(i)                                     you have carefully read, fully
understand and agree to all of the terms and conditions described in these
Terms and Conditions and the Plan; and

 

(ii)                                  you understand and agree that these
Terms and Conditions and the Plan constitute the entire understanding between
you and the Company regarding the Award, and that any prior agreements,
commitments or negotiations concerning the Restricted Units are replaced and
superseded.

 

You will be deemed to
consent to the application of the terms and conditions set forth in these Terms
and Conditions and the Plan unless you contact Tyco International Ltd., c/o
Equity Plan Administration, 9 Roszel Road, Princeton, NJ 08540 in writing
within thirty (30) days of the date of these Terms and Conditions.  Notification of your non-consent will nullify
this grant unless otherwise agreed to in writing by you and the Company.

 

 

	
   

  	
   

  
	
   

  	
  [·]

  

 

6

 

Tyco International Ltd.

2004 Stock and Incentive Plan (the “Plan”)

 

TERMS
AND CONDITIONS

OF

RESTRICTED
UNIT AWARD

 

RESTRICTED UNIT AWARD granted as of March 13,
2009 (the “Grant Date”).

 

1.                                       Grant of Award.  Tyco
International Ltd. (the “Company”) has granted you Restricted Units, as
described in the grant notification letter that was issued to you (“Grant
Letter”), subject to the provisions of these Terms and Conditions.  The Company will hold the Restricted Units in
a bookkeeping account on your behalf until they become payable or are forfeited
or cancelled.

 

2.                                       Payment Amount. 
Each Restricted Unit represents one (1) Share of Common Stock.

 

3.                                       Form of Payment. 
Vested Restricted Units will be redeemed solely for Shares, subject to Section 13.

 

4.                                       Dividends. 
Restricted Units are a promise to deliver Common Stock upon
vesting.  For each Restricted Unit that
is unvested, you will be credited with a Dividend Equivalent Unit (DEU) for any
cash or stock dividends distributed by the Company on Company Common Stock.  DEUs will be calculated at the same dividend
rate paid to other holders of Common Stock. 
DEUs will vest in accordance with the vesting schedule applicable to the
underlying Units and shall be payable at the same time that the underlying Units
are payable as provided herein.

 

5.                                       Vesting.  Your
Restricted Units will vest in full on [·]. 
No credit will be given for periods following Termination of
Directorship, except as specifically provided herein. Except as otherwise
provided in these Terms and Conditions, any payment shall be made to you as
soon as practicable following the vesting date set forth in this Section 5.

 

6.                                       Termination of Directorship. 
Any Restricted Units that have not vested as of your Termination of
Directorship pursuant to paragraphs 7 and 8 will immediately be forfeited, and
your rights with respect to such Restricted Units will end. Termination of
Directorship means the date of cessation of a Director’s relationship with the
Company for any reason, with or without Cause, as determined by the Board.

 

7.                                       Death or Disability.  If
your Termination of Directorship is a result of your Death or Disability, your
Award will become fully vested as of your Termination of Directorship.  Any payment shall be made to you as soon as
practicable following your Termination of Directorship.  If
you are deceased, the Company will make a payment to your 

 

1

 

estate only after the
Committee has determined that the payee is the duly appointed executor or administrator
of your estate.

 

8.                                       Change in Control. 
In the event of a Change in Control of Tyco International Ltd., as
defined in the Plan document, and your Termination of Directorship in
connection with a Change in Control, Restricted Units will immediately become
fully vested and payment shall be made as soon as practicable following such
Termination of Directorship.

 

9.                                       Withholdings; Tax Recovery. 
The Company will have the right, prior to any issuance or delivery of
Shares on your Restricted Units, to withhold or require from you the payment of
the amount necessary to satisfy applicable tax requirements.

 

10.                                 Transfer of Award. 
You may not transfer any interest in Restricted Units except by will or
the laws of descent and distribution. 
Any other attempt to dispose of your interest in Restricted Units will
be null and void.

 

11.                                 Forfeiture of Award.  If
your services as a Director of the Company have been terminated for Cause, any unvested
Restricted Units shall be immediately rescinded and you will forfeit any rights
you have with respect to such Units.

 

12.                                 Adjustments. 
In the event of any stock split, reverse stock split, dividend or other
distribution (whether in the form of cash, Shares, other securities or other
property), extraordinary cash dividend, recapitalization, merger,
consolidation, split-up, spin-off, reorganization, combination, repurchase or
exchange of Shares or other securities, the issuance of warrants or other
rights to purchase Shares or other securities, or other similar corporate transaction
or event, the Committee shall adjust the number and kind of Shares covered by
the Restricted Units and other relevant provisions to the extent necessary to
prevent dilution or enlargement of the benefits or potential benefits intended
to be provided by the Restricted Units. 
Any such determinations and adjustments made by the Committee will be
binding on all persons.

 

13.                                 Restrictions on Payment of
Shares.  Payment of Shares for your Restricted Units
is subject to the conditions that, to the extent required at the time of delivery,
(a) the Shares underlying the Restricted Units will be duly listed, upon
official notice of redemption, upon the NYSE, and (b) a Registration
Statement under the Securities Act of 1933 with respect to the Shares will be
effective.  The Company will not be
required to deliver any Common Stock until all applicable federal and state
laws and regulations have been complied with and all legal matters in
connection with the issuance and delivery of the Shares have been approved by
counsel of the Company.

 

14.                                 Disposition of Securities. 
By accepting the Award, you acknowledge that you have read and
understand the Company’s policy, and are aware of and understand your
obligations under federal securities laws, in respect of trading in the Company’s
securities.  The Company will have the
right to recover, or receive reimbursement for, any compensation or profit
realized on the disposition of Shares received for Restricted Units to the
extent that the Company has a right of recovery or reimbursement under
applicable securities laws.

 

15.                                 Plan Terms Govern. 
The redemption of Restricted Units, the disposition of any Shares
received for Restricted Units, and the treatment of any gain on the disposition
of these 

 

2

 

Shares are subject to
the terms of the Plan and any rules that the Committee may prescribe.  The Plan document, as may be amended from
time to time, is incorporated into these Terms and Conditions.  Capitalized terms used in these Terms and
Conditions have the meaning set forth in the Plan, unless otherwise stated in
these Terms and Conditions.  In the event
of any conflict between the terms of the Plan and the terms of these Terms and
Conditions, the Plan will control.  By
accepting the Award, you acknowledge receipt of the Plan and the prospectus, as
in effect on the date of these Terms and Conditions.

 

16.                                 Personal Data. 
To comply with applicable law and to administer the Plan and these Terms
and Conditions properly, the Company and its agents may hold and process your
personal data and/or sensitive personal data. 
Such data includes, but is not limited to, the information provided in
this grant package and any changes thereto, other appropriate personal and
financial data about you, and information about your participation in the Plan
and Shares obtained under the Plan from time to time.  By accepting the Award, you hereby give your
explicit consent to the Company’s processing any such personal data and/or
sensitive personal data.  You also hereby
give your explicit consent to the Company’s transfer of any such personal data
and/or sensitive personal data outside the country in which you perform
services as a Director or reside and to the United States.  The legal persons for whom your personal data
are intended include the Company and any of its Subsidiaries (or former
Subsidiaries as are deemed necessary), the outside Plan administrator as
selected by the Company from time to time, and any other person that the
Company may find in its administration of the Plan to be appropriate.  You have the right to review and correct your
personal data by contacting the Office of the Corporate Secretary.  You understand that the transfer of the
information outlined here is important to the administration of the Plan, and
that failure to consent to the transmission of such information may limit or
prohibit your participation in the Plan.

 

17.                                 No Contract or Promise of Future
Grants.  By accepting the Award, you agree to be bound
by these Terms and Conditions and acknowledge that the Award is granted at the
sole discretion of the Company and is not considered part of any contract of service
as a Board member with the Company or other compensation.   If your service as a Board member with the Company
is terminated for any reason, whether lawfully or unlawfully, you agree that
you will not be entitled by way of damages for breach of contract, dismissal or
compensation for loss of office or otherwise to any sum, shares or other
benefits to compensate you for the loss or diminution in value of any actual or
prospective rights, benefits or expectation under or in relation to the Plan.

 

18.                                 Limitations. 
Nothing in these Terms and Conditions or the Plan gives you any right to
continue in the service as a Board member with the Company or any of its
Subsidiaries.  Payment of your Restricted
Units is not secured by a trust, insurance contract or other funding medium,
and you do not have any interest in any fund or specific asset of the Company
by reason of this Award or the account established on your behalf.  You have no rights as a stockholder of the
Company pursuant to the Restricted Units until Shares are actually delivered to
you.

 

19.                                 Incorporation of Other
Agreements.  These Terms and Conditions and the Plan
constitute the entire understanding between you and the Company regarding the
Restricted Units.  

 

3

 

These Terms and
Conditions supercede any prior agreements, commitments or negotiations
concerning the Restricted Units.

 

20.                                 Severability. 
The invalidity or unenforceability of any provision of these Terms and
Conditions will not affect the validity or enforceability of the other
provisions of the Agreement, which will remain in full force and effect.  Moreover, if any provision is found to be
excessively broad in duration, scope or covered activity, the provision will be
construed so as to be enforceable to the maximum extent compatible with
applicable law.

 

21.                                 Sections
409A and 457A.  The award is
intended to be an exempt “short-term deferral” under Sections 409A and 457A of
the Internal Revenue Code of the United States. The Committee may make such
modifications to these Terms and Conditions as it deems necessary or
appropriate to ensure that the Award is exempt from Sections 409A and 457A.

 

By accepting this
Award, you agree to the following:

 

(i)                                     you have carefully read, fully
understand and agree to all of the terms and conditions described in these
Terms and Conditions and the Plan; and

 

(ii)                                  you understand and agree that these
Terms and Conditions and the Plan constitute the entire understanding between
you and the Company regarding the Award, and that any prior agreements,
commitments or negotiations concerning the Restricted Units are replaced and
superseded.

 

You will be deemed to
consent to the application of the terms and conditions set forth in these Terms
and Conditions and the Plan unless you contact Tyco International Ltd., c/o Tyco
International Management Company, Attn: Equity Plan Administration, 9 Roszel
Road, Princeton, NJ 08540 in writing within thirty (30) days of the date of
these Terms and Conditions.  Notification
of your non-consent will nullify this grant unless otherwise agreed to in writing
by you and the Company.

 

 

	
   

  	
   

  
	
   

  	
  [·]

  

 

4Exhibit 10.3

 

TYCO INTERNATIONAL

 

CHANGE IN CONTROL SEVERANCE PLAN FOR CERTAIN

 

U.S. OFFICERS AND EXECUTIVES

 

Amended and Restated as of January 1,
2009

 

 

	
  ARTICLE I

  	
  BACKGROUND, PURPOSE AND TERM OF PLAN

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.01

  	
  Purpose of the Plan

  	
  1

  
	
  Section 1.02

  	
  Term of the Plan

  	
  1

  
	
  Section 1.03

  	
  Compliance with Code Section 409A

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  “Annual Bonus”

  	
  1

  
	
  Section 2.02

  	
  “Base Salary”

  	
  1

  
	
  Section 2.03

  	
  “Board”

  	
  1

  
	
  Section 2.04

  	
  “Cause”

  	
  1

  
	
  Section 2.05

  	
  “Change in Control”

  	
  1

  
	
  Section 2.06

  	
  “Change in Control Termination”

  	
  2

  
	
  Section 2.07

  	
  “COBRA”

  	
  2

  
	
  Section 2.08

  	
  “Code”

  	
  3

  
	
  Section 2.09

  	
  “Committee”

  	
  3

  
	
  Section 2.10

  	
  “Company”

  	
  3

  
	
  Section 2.11

  	
  “Effective Date”

  	
  3

  
	
  Section 2.12

  	
  “Eligible Employee”

  	
  3

  
	
  Section 2.13

  	
  “Employee”

  	
  3

  
	
  Section 2.14

  	
  “Employer”

  	
  3

  
	
  Section 2.15

  	
  “ERISA”

  	
  3

  
	
  Section 2.16

  	
  “Exchange Act”

  	
  3

  
	
  Section 2.17

  	
  “Executive Severance Plan”

  	
  3

  
	
  Section 2.18

  	
  “Good Reason Resignation”

  	
  3

  
	
  Section 2.19

  	
  “Involuntary Termination”

  	
  4

  
	
  Section 2.20

  	
  “Key Employee”

  	
  4

  
	
  Section 2.21

  	
  “Notice Pay”

  	
  4

  
	
  Section 2.22

  	
  “Officer”

  	
  4

  
	
  Section 2.23

  	
  “Participant”

  	
  5

  
	
  Section 2.24

  	
  “Permanent Disability”

  	
  5

  
	
  Section 2.25

  	
  “Plan”

  	
  5

  
	
  Section 2.26

  	
  “Plan Administrator”

  	
  5

  
	
  Section 2.27

  	
  “Postponement Period”

  	
  5

  
	
  Section 2.28

  	
  “Potential Change in Control”

  	
  5

  
	
  Section 2.29

  	
  “Release”

  	
  6

  
	
  Section 2.30

  	
  “Segment President”

  	
  6

  
	
  Section 2.31

  	
  “Service”

  	
  6

  
	
  Section 2.32

  	
  “Separation from Service”

  	
  6

  
	
  Section 2.33

  	
  “Separation from Service Date”

  	
  6

  
	
  Section 2.34

  	
  “Severance Benefits”

  	
  6

  
	
  Section 2.35

  	
  “Severance Period”

  	
  7

  
	
  Section 2.36

  	
  “Subsidiary”

  	
  7

  
	
  Section 2.37

  	
  “Successor”

  	
  7

  
	
  Section 2.38

  	
  “Voluntary Resignation”

  	
  7

  

 

i

 

	
  ARTICLE III

  	
  PARTICIPATION AND
  ELIGIBILITY FOR BENEFITS

  	
  7

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Participation

  	
  7

  
	
  Section 3.02

  	
  Conditions

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  DETERMINATION OF SEVERANCE BENEFITS

  	
  9

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Amount of Severance Benefits Upon Involuntary
  Termination and Good Reason Resignation

  	
  9

  
	
  Section 4.02

  	
  Voluntary Resignation; Termination Due to Death or
  Permanent Disability

  	
  11

  
	
  Section 4.03

  	
  Termination for Cause

  	
  11

  
	
  Section 4.04

  	
  Reduction of Severance Benefits

  	
  12

  
	
  Section 4.05

  	
  Non-Duplication of Benefits

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  METHOD, DURATION AND LIMITATION OF SEVERANCE BENEFIT
  PAYMENTS

  	
  12

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Method of Payment

  	
  12

  
	
  Section 5.02

  	
  Other Arrangements

  	
  13

  
	
  Section 5.03

  	
  Code Section 409A

  	
  13

  
	
  Section 5.04

  	
  Termination of Eligibility for Benefits

  	
  14

  
	
  Section 5.05

  	
  Limitation on Benefits

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  CONFIDENTIALITY AND NON-DISPARAGEMENT

  	
  15

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Confidential Information

  	
  15

  
	
  Section 6.02

  	
  Non-Disparagement

  	
  16

  
	
  Section 6.03

  	
  Reasonableness

  	
  16

  
	
  Section 6.04

  	
  Equitable Relief

  	
  16

  
	
  Section 6.05

  	
  Survival of Provisions

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
  THE PLAN ADMINISTRATOR

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Authority and Duties

  	
  17

  
	
  Section 7.02

  	
  Compensation of the Plan Administrator

  	
  17

  
	
  Section 7.03

  	
  Records, Reporting and Disclosure

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  AMENDMENT, TERMINATION AND DURATION

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  Amendment, Suspension and Termination

  	
  18

  
	
  Section 8.02

  	
  Duration

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  DUTIES OF THE COMPANY AND THE COMMITTEE

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Records

  	
  18

  
	
  Section 9.02

  	
  Payment

  	
  18

  
	
  Section 9.03

  	
  Discretion

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  CLAIMS PROCEDURES

  	
  19

  
	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  Claim

  	
  19

  
	
  Section 10.02

  	
  Initial Claim

  	
  19

  
	
  Section 10.03

  	
  Appeals of Denied Administrative Claims

  	
  20

  
	
  Section 10.04

  	
  Appointment of the Named Appeals Fiduciary

  	
  20

  

 

ii

 

	
  Section 10.05

  	
  Arbitration; Expenses

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
  MISCELLANEOUS

  	
  21

  
	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  Nonalienation of Benefits

  	
  21

  
	
  Section 11.02

  	
  Notices

  	
  21

  
	
  Section 11.03

  	
  Successors

  	
  21

  
	
  Section 11.04

  	
  Other Payments

  	
  21

  
	
  Section 11.05

  	
  No Mitigation

  	
  21

  
	
  Section 11.06

  	
  No Contract of Employment

  	
  22

  
	
  Section 11.07

  	
  Severability of Provisions

  	
  22

  
	
  Section 11.08

  	
  Heirs, Assigns, and Personal Representatives

  	
  22

  
	
  Section 11.09

  	
  Headings and Captions

  	
  22

  
	
  Section 11.10

  	
  Gender and Number

  	
  22

  
	
  Section 11.11

  	
  Unfunded Plan

  	
  22

  
	
  Section 11.12

  	
  Payments to Incompetent Persons

  	
  22

  
	
  Section 11.13

  	
  Lost Payees

  	
  22

  
	
  Section 11.14

  	
  Controlling Law

  	
  22

  
	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
  SEVERANCE BENEFITS SALARY REPLACEMENT AND ANNUAL
  BONUS

  	
  A-1

  

 

iii

 

ARTICLE I

 

BACKGROUND,
PURPOSE AND TERM OF PLAN

 

Section 1.01         Purpose
of the Plan. The
purpose of the Plan is to provide Eligible Employees with certain compensation
and benefits as set forth in the Plan in the event the Eligible Employee’s
employment with the Company or a Subsidiary is terminated due to a Change in
Control Termination. The Plan is not intended to be an “employee pension
benefit plan” or “pension plan” within the meaning of Section 3(2) of
ERISA. Rather, this Plan is intended to be a “welfare benefit plan” within the
meaning of Section 3(1) of ERISA and to meet the descriptive
requirements of a plan constituting a “severance pay plan” within the meaning
of regulations published by the Secretary of Labor at Title 29, Code of Federal
Regulations, section 2510.3-2(b). Accordingly, the benefits paid by the Plan
are not deferred compensation and no employee shall have a vested right to such
benefits.

 

Section 1.02         Term
of the Plan. The
Plan shall generally be effective as of the Effective Date, but subject to
amendment from time to time in accordance with Section 8.01. The Plan
shall continue until terminated pursuant to Article VIII of the Plan.

 

Section 1.03         Compliance
with Code Section 409A. The terms of this Plan are intended to, and shall be
interpreted so as to, comply in all respects with the provisions of Code Section 409A
and the regulations and rulings promulgated thereunder.

 

ARTICLE II

 

DEFINITIONS

 

Section 2.01         “Annual Bonus” shall mean 100% of
the Participant’s target annual bonus.

 

Section 2.02         “Base Salary” shall mean the
annual base salary in effect as of the Participant’s Separation from Service
Date.

 

Section 2.03         “Board” shall mean the Board of
Directors of the Company, or any successor thereto, or a committee thereof
specifically designated for purposes of making determinations hereunder.

 

Section 2.04         “Cause” shall mean (i) a
material violation of any fiduciary duty owed to the Company, (ii) conviction
of, or entry of a plea of nolo contendere with respect to, a felony or
misdemeanor, (iii) dishonesty, (iv) theft, or (v) other
egregious conduct, that is likely to have a materially detrimental impact on
the Company and its employees. Whether an Eligible Employee’s termination is as
a result of Cause shall be determined in the discretion of the Plan
Administrator.

 

Section 2.05         “Change in Control” shall mean any of the
following events:

 

(i)            any
“person” (as defined in Section 13(d) and 14(d) of the Exchange
Act, excluding for this purpose, (i) the Company or any subsidiary company
(wherever incorporated) of the Company as defined by the law of the Company’s
place of incorporation or (ii) any

 

1

 

employee benefit plan of the Company or any such
subsidiary company (or any person or entity organized, appointed or established
by the Company for or pursuant to the terms of any such plan that acquires
beneficial ownership of voting securities of the Company), is or becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act) directly or
indirectly of securities of the Company representing more than 30 percent of
the combined voting power of the Company’s then outstanding securities;
provided, however, that no Change in Control will be deemed to have occurred as
a result of a change in ownership percentage resulting solely from an
acquisition of securities by the Company;

 

(ii)           persons
who, as of the Effective Date, constitute the Board (the “Incumbent Directors”)
cease for any reason (including without limitation, as a result of a tender
offer, proxy contest, merger or similar transaction) to constitute at least a
majority thereof, provided that any person becoming a Director of the Company
subsequent to the Effective Date shall be considered an Incumbent Director if
such person’s election or nomination for election was approved by a vote of at
least 50 percent of the Incumbent Directors; but provided further, that any
such person whose initial assumption of office is in connection with an actual
or threatened proxy contest relating to the election of members of the Board or
other actual or threatened solicitation of proxies or consents by or on behalf
of a “person” (as defined in Section 13(d) and 14(d) of the
Exchange Act) other than the Board, including by reason of agreement intended
to avoid or settle any such actual or threatened contest or solicitation, shall
not be considered an Incumbent Director;

 

(iii)          consummation
of a reorganization, merger or consolidation or sale or other disposition of at
least 80 percent of the assets of the Company (a “Business Combination”), in
each case, unless, following such Business Combination, all or substantially
all of the individuals and entities who were the beneficial owners of
outstanding voting securities of the Company immediately prior to such Business
Combination beneficially own directly or indirectly more than 50 percent of the
combined voting power of the then outstanding voting securities entitled to
vote generally in the election of directors, as the case may be, of the company
resulting from such Business Combination (including, without limitation, a
company which, as a result of such transaction, owns the Company or all or
substantially all of the Company’s assets either directly or through one or
more Subsidiary companies (wherever incorporated) of the Company as defined by
the law of the Company’s place of incorporation in substantially the same
proportions as their ownership, immediately prior to such Business Combination,
of the outstanding voting securities of the Company; or

 

(iv)          approval
by the stockholders of the Company of a complete liquidation or dissolution of
the Company.

 

Section 2.06         “Change in Control Termination”
shall mean a Participant’s Involuntary Termination or Good Reason Resignation
that occurs during the period beginning 60 days prior to the date of a Change
in Control and ending two years after the date of such Change in Control.

 

Section 2.07         “COBRA” shall mean the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended, and the regulations
promulgated thereunder.

 

2

 

Section 2.08         “Code” shall mean the Internal
Revenue Code of 1986, as amended, and the regulations promulgated thereunder.

 

Section 2.09         “Committee” shall mean the
Compensation and Human Resources Committee of the Board or such other committee
appointed by the Board to assist the Company in making determinations required
under the Plan in accordance with its terms. The “Committee” may delegate its
authority under the Plan to an individual or another committee.

 

Section 2.10         “Company” shall mean Tyco
International Ltd. Unless it is otherwise clear from the context, Company shall
generally include participating Subsidiaries.

 

Section 2.11         “Effective Date” shall mean January 1,
2009.

 

Section 2.12         “Eligible Employee” shall mean an
Employee employed in the United States who is an Officer, a Segment President
or a Corporate Vice-President in Career Band 1 or 2. If there is any question
as to whether an Employee is deemed an Eligible Employee for purposes of the
Plan, the Plan Administrator shall make the determination.

 

Section 2.13         “Employee” shall mean an
individual employed by an Employer as a common law employee on the United
States payroll of Tyco International Ltd. or a Subsidiary, and shall not
include any person working for the Company through a temporary service or on a
leased basis or who is hired by the Company as an independent contractor,
consultant, or otherwise as a person who is not an employee for purposes of
withholding federal employment taxes, as evidenced by payroll records or a
written agreement with the individual, regardless of any contrary governmental
or judicial determination or holding relating to such status or tax
withholding.

 

Section 2.14         “Employer” shall mean the Company
or any Subsidiary with respect to which this Plan has been adopted.

 

Section 2.15         “ERISA” shall mean the Employee
Retirement Income Security Act of 1974, as amended, and the regulations
promulgated thereunder.

 

Section 2.16         “Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended, and the regulations promulgated
thereunder.

 

Section 2.17         “Executive Severance Plan” shall
mean the Tyco International Severance Plan for U.S. Officers and Executives
(f/k/a the Tyco International (US) Inc. Severance Plan for U.S. Officers and
Executives), which plan is superseded by this Plan in the event of any
Participant’s Change in Control Termination.

 

Section 2.18         “Good Reason Resignation” shall
mean any retirement or termination of employment by a Participant that is not
initiated by the Company or any Subsidiary and that is caused by any one or
more of the following events which occurs during the period beginning 60 days
prior to the date of a Change in Control and ending two years after the date of
such Change in Control:

 

3

 

(i)            Without
the Participant’s written consent, assignment to the Participant of any duties
inconsistent in any material respect with the Participant’s authority, duties
or responsibilities as in effect immediately prior to the Change in Control, or
any other action by the Company which results in a material diminution in such
authority, duties or responsibilities;

 

(ii)           Without
the Participant’s written consent, a material change in the geographic location
at which the Participant must perform services to a location which is more than
60 miles from the Participant’s principal place of business immediately
preceding the Change in Control;

 

(iii)          Without
the Participant’s written consent, a material reduction to the Participant’s
base compensation and benefits, taken as a whole, as in effect immediately
prior to the Change in Control; or

 

(iv)          The
Company’s failure to obtain a satisfactory agreement from any Successor to
assume and agree to perform the Company’s obligations to the Participant under
this Plan, as contemplated in Section 11.03 herein.

 

Notwithstanding the foregoing, the Participant shall
be considered to have a Good Reason Resignation only if the Participant
provides written notice to the Company specifying in reasonable detail the
events or conditions upon which the Participant is basing such Good Reason
Resignation and the Participant provides such notice within 90 days after the
event that gives rise to the Good Reason Resignation. Within 30 days after
notice has been received, the Company shall have the opportunity, but shall
have no obligation, to cure such events or conditions that give rise to the
Good Reason Resignation. If the Company does not cure such events or conditions
within the 30-day period, the Participant may terminate employment with the
Company based on Good Reason Resignation within 30 days after the expiration of
the cure period.

 

Section 2.19         “Involuntary Termination” shall
mean the date that a Participant involuntarily separates from service with the
Company and its Affiliates within the meaning of Code Section 409A and
shall not include a separation from service for Cause, Permanent Disability or
death, as provided under and subject to the conditions of Article III.

 

Section 2.20         “Key Employee” shall mean an
Employee who, at any time during the 12-month period ending on the
identification date, is a “specified employee” under Code Section 409A, as
determined by the Committee or its delegate. The determination of Key
Employees, including the number and identity of persons considered specified
employees and the identification date, shall be made by the Committee or its delegate
in accordance with the provisions of Code Section 409A and the regulations
promulgated thereunder.

 

Section 2.21         “Notice Pay” shall mean the
amounts that a Participant is eligible to receive pursuant to Article IV
of the Plan.

 

Section 2.22         “Officer”  shall
mean any individual who is an officer of an Employer, and who is considered an
officer for purposes of Rule 16a-1(f) as promulgated under the
Exchange Act immediately before the Change in Control.

 

4

 

Section 2.23         “Participant” shall mean any
Eligible Employee who meets the requirements of Article III and thereby
becomes eligible for salary replacement and other benefits under the Plan.

 

Section 2.24         “Permanent Disability” shall mean
that an Employee has a permanent and total incapacity from engaging in any
employment for the Employer for physical or mental reasons. A “Permanent
Disability” shall be deemed to exist if the Employee meets the requirements for
disability benefits under the Employer’s long-term disability plan or under the
requirements for disability benefits under the Social Security law (or similar
law outside the United States, if the Employee is employed in that
jurisdiction) then in effect, or if the Employee is designated with an inactive
employment status at the end of a disability or medical leave.

 

Section 2.25         “Plan” means the Tyco
International Change in Control Severance Plan for Certain U.S. Officers and
Executives (f/k/a the Tyco International (US) Inc. Change in Control Severance
Plan for Certain U.S. Officers and Executives) as set forth herein, and as the
same may from time to time be amended.

 

Section 2.26         “Plan Administrator” shall mean,
for the period prior to a Potential Change in Control, the individual(s) appointed
by the Committee to administer the terms of the Plan as set forth herein and if
no individual is appointed by the Committee to serve as the Plan Administrator
for the Plan, the Plan Administrator shall be the Senior Vice President - Human
Resources, Tyco International Management Company (or the equivalent). In the
event of the occurrence of a Potential Change in Control, the Senior
Vice-President, Human Resources - Tyco International Management Company (or the
equivalent) shall appoint a person or entity independent of the Company and any
person operating under the Company’s control or on its behalf to serve as Plan
Administrator (and such person or entity shall be the Plan Administrator for
all purposes after such appointment), and such appointment shall take effect
and become irrevocable as of the date of said appointment (provided that such
appointment shall be revocable if a Change in Control does not occur and the
Potential Change in Control expires in accordance with Section 2.26(y)). For
periods prior to a Potential Change in Control, the Plan Administrator may
delegate all or any portion of its authority under the Plan to any other
person(s).

 

Section 2.27         “Postponement Period” shall mean,
for a Key Employee, the period of six months after the Key Employee’s
Separation from Service Date (or such other period as may be required by Code Section 409A)
during which deferred compensation may not be paid to the Key Employee under
Code Section 409A.

 

Section 2.28         “Potential Change in Control”
shall mean the occurrence and continuation of any of the following: (a) any
“person” (as defined in Section 13(d) and 14(d) of the Exchange
Act), excluding for this purpose, (i) the Company or any subsidiary
company (wherever incorporated) of the Company as defined by the law of the
Company’s place of incorporation , as amended or (ii) any employee benefit
plan of the Company or any such subsidiary company (or any person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan that acquires beneficial ownership of voting securities of the
Company), is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act) directly or indirectly of securities of the Company
representing more than 5 percent of the combined voting power of the Company’s
then outstanding securities unless such Person has reported or is

 

5

 

required to report such ownership on Schedule 13G
under the Exchange Act (or any comparable or successor report) or on Schedule
13D under the Exchange Act (or any comparable or successor report), which
Schedule 13D does not state any intention to or reserve the right to control or
influence the management or policies of the Company or engage in any of the actions
specified in Item 4 of such Schedule (other than the disposition of the common
stock) so long as such Person neither reports nor is required to report such
ownership other than as described in this paragraph; provided, however, that a
Potential Change in Control will not be deemed to have occurred as a result of
a change in ownership percentage resulting solely from an acquisition of
securities by the Company, (b) the Company enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control, (c) any
“person” (as defined in subsection(a)) publicly announces an intention to take
or to consider taking actions which, if consummated, would constitute or result
in a Change in Control, (d) any person (as defined in subsection (a))
commences a solicitation (as defined in Rule 14a-1 of the Exchange Act) of
proxies or consents that has the purpose of effecting or would (if successful)
result in a Change in Control, (e) a tender or exchange offer for at least
30% of the outstanding voting securities of the Company, made by a “person” (as
defined in subsection (a)), is first published or sent or given (within the
meaning of Rule 14d-2(a) of the Exchange Act), or (f) the Board
adopts a resolution to the effect that, for purposes of the Plan, a Potential
Change in Control has occurred. The Potential Change in Control shall be deemed
in effect until the earlier of (x) the occurrence of a Change in Control,
or (y) the adoption by the Board of a resolution stating that, for
purposes of the Plan, the Potential Change in Control has expired.

 

Section 2.29         “Release” shall mean the
Separation of Employment Agreement and General Release, as provided by the
Company.

 

Section 2.30         “Segment President” shall mean an
Officer who is not employed by the corporate office, but who is a president of
one of the Company’s business segments.

 

Section 2.31         “Service” shall mean the total
number of years and completed months the Participant was an Employee of the
Company. Service with any predecessor employer or with a Subsidiary prior to
the Subsidiary’s becoming part of the Company shall be recognized only to the
extent specified in the merger or acquisition documentation relating to the
Subsidiary or other applicable governing documents. Periods of authorized leave
of absence, such as military leave, will be included in Service only to the
extent required by applicable law. Any period of employment with the Company, a
Subsidiary, or a predecessor employer for which an Eligible Employee previously
received severance benefits, shall be excluded from Service.

 

Section 2.32         “Separation from Service” means “separation
from service” within the meaning of Code Section 409A(a)(2)(A)(i) and
the applicable regulations and ruling promulgated thereunder.

 

Section 2.33         “Separation from Service Date”
shall mean, with respect to a Participant, the date on which such Participant
experiences a Separation from Service.

 

Section 2.34         “Severance Benefits” shall mean
the salary and bonus replacement amounts and other benefits that a Participant
is eligible to receive pursuant to Article IV of the Plan.

 

6

 

Section 2.35         “Severance Period” shall mean the
period for which a Participant is entitled to receive non-cash Severance
Benefits under this Plan, as follows: 
Corporate Officers - 36 months; Segment Presidents - 24 months; and
Corporate Vice Presidents (in Career Band 1 or 2) - 18 months.

 

Section 2.36         “Subsidiary” shall mean (i) a
subsidiary company (wherever incorporated) as defined by the law of the Company’s
place of incorporation, (ii) any separately organized business unit,
whether or not incorporated, of the Company, (iii) any employer that is
required to be aggregated with the Company pursuant to section 414 of the
Internal Revenue Code of 1986, as amended, and regulations issued thereunder,
and (iv) any service recipient or employer that is within a controlled
group of corporations with the Company as defined in Code Sections 1563(a)(1), (2) and
(3) where the phrase “at least 50%” is substituted in each place “at least
80%” appears or is with the Company as part of a group of trades or businesses
under common control as defined in Code Section 414(c) and Treas.
Reg. Section 1.414(c)-2 where the phrase “at least 50%” is substituted in
each place “at least 80%” appears, provided, however, that when the relevant
determination is to be based upon legitimate business criteria (as described in
Treas. Reg. Section 1.409A-1(b)(5)(iii)(E) and Section 1.409A-1(h)(3)),
the phrase “at least 20%” shall be substituted in each place “at least 80%”
appears as described above with respect to both a controlled group of
corporations and trades or business under common control.

 

Section 2.37         “Successor” shall mean any other
corporation or unincorporated entity or group of corporations or unincorporated
entities which acquires ownership, directly or indirectly, through merger,
consolidation, purchase or otherwise, of all or substantially all of the assets
of the Company.

 

Section 2.38         “Voluntary Resignation” shall mean
any Separation from Service that is not initiated by the Company or any
Subsidiary other than a Good Reason Resignation.

 

ARTICLE III

 

PARTICIPATION
AND ELIGIBILITY FOR BENEFITS

 

Section 3.01         Participation. 
Each Eligible Employee in the Plan who incurs a Change in Control
Termination and who satisfies the conditions of Section 3.02 shall be
eligible to receive the Severance Benefits described in the Plan, subject
however, to the application of the non-duplication provisions of Section 4.05.

 

Section 3.02         Conditions.

 

(a)           Eligibility for any Severance Benefits is expressly
conditioned on the occurrence of the following within 60 days after the
Participant’s Separation from Service Date: (i) execution by the
Participant of a Release in the form provided by the Company; (ii) compliance
by the Participant with all the terms and conditions of such Release; (iii) the
Participant’s written agreement to the confidentiality and non-disparagement
provisions in Article VI during and after the Participant’s employment
with the Company; and (iv) to the extent permitted in Section 4.04 of
the Plan, execution of a written agreement that authorizes the

 

7

 

deduction of amounts owed to the Company prior to
the payment of any Severance Benefits (or in accordance with any other schedule
as is agreed between the Participant and the Company).  If the Plan Administrator determines that the
Participant has not fully complied with any of the terms of the Release, the
Plan Administrator may withhold Severance Benefits not yet in pay status or
discontinue the payment of the Participant’s Severance Benefits and may require
the Participant, by providing written notice of such repayment obligation to
the Participant, to repay any portion of the Severance Benefits already
received under the Plan.  If the Plan
Administrator notifies a Participant that repayment of all or any portion of
the Severance Benefits received under the Plan is required, such amounts shall
be repaid within thirty (30) calendar days of the date the written notice is
sent, provided, however, that if the Participant files an appeal of such
determination under the claims procedures described in Article X, then
such repayment obligation shall be suspended pending the outcome of the appeals
procedure.  Any remedy under this
subsection (a) shall be in addition to, and not in place of, any other
remedy, including injunctive relief, that the Company may have.

 

(b)          An Eligible Employee will not be
eligible to receive Severance Benefits under any of the following
circumstances:

 

(i)            The Eligible Employee’s Voluntary Resignation;

 

(ii)           The Eligible Employee resigns employment (other than a
Good Reason Resignation) before the job-end date mutually agreed to in writing
between the Participant and the Employer, including any extension thereto as is
mutually agreed to in writing between the parties;

 

(iii)          The Eligible Employee’s employment is terminated for Cause;

 

(iv)          The Eligible Employee’s employment is terminated due to the
Eligible Employee’s death or Permanent Disability;

 

(v)           The Eligible Employee does not return to work within the period
prescribed by law (or if there is no such period prescribed by law, then within
a reasonable period as is determined by the Plan Administrator) following an
approved leave of absence, unless such period is extended by mutual written
agreement of the parties; or

 

(vi)          The Eligible Employee does not satisfy the Conditions for
Severance in Section 3.02(a);

 

(vii)         The Eligible Employee’s employment with the Employer
terminates as a result of a Change in Control and the Eligible Employee accepts
employment, or has the opportunity to continue employment, with a Successor
(other than under terms and conditions which would permit a Good Reason
Resignation).

 

(c)          The Plan Administrator has the
discretion to make initial determinations regarding an Eligible Employee’s
eligibility to receive Severance Benefits hereunder.

 

(d)          An Eligible Employee returning from
approved military leave during the period beginning 60 days before a Change in
Control and ending two years after a Change in

 

8

 

Control will be eligible for Severance Benefits if: (i) he/she
is eligible for reemployment under the provisions of the Uniformed Services
Employment and Reemployment Rights Act (USERRA); (ii) his/her pre-military
leave job is eliminated; and (iii) the Employer’s circumstances are
changed so as to make reemployment in another position impossible or
unreasonable, or re-employment would create an undue hardship for the
Employer.  If the Eligible Employee
returning from military leave qualifies for Severance Benefits, his/her
severance benefits will be calculated as if he/she had remained continuously
employed from the date he/she began his/her military leave.  The Eligible Employee must also satisfy any
other relevant conditions for payment, including execution of a Release.

 

ARTICLE IV

 

DETERMINATION
OF SEVERANCE BENEFITS

 

Section 4.01         Amount
of Severance Benefits Upon Involuntary Termination and Good Reason Resignation. 
The Severance Benefits to be provided to an Eligible Employee who incurs
a Change in Control Termination and is determined to be eligible for Severance
Benefits shall be as follows:

 

(a)           Notice Pay.  Except for Officers, each Eligible Employee
who meets the eligibility requirements for Severance Benefits under Section 3.01
shall receive 30 calendar days notice as a Notice Period.  In the event that the Company determines that
a Participant’s last day of work shall be prior to the end of his or her Notice
Period, such Employee shall be entitled to pay in lieu of notice for the
balance of such Notice Period.  Notice
Pay paid to a Participant shall be in addition to, and not offset against, the
Severance Benefits the Participant may be entitled to receive under this Article IV.  An Eligible Employee who does not sign, or
who revokes his or her signature on, a Release shall only be eligible for
Notice Pay.  Unless otherwise permitted
by the applicable plan documents or laws, an Eligible Employee will not be
eligible to apply for short-term disability, long-term disability and/or
workers’ compensation anytime after the Eligible Employee’s last active day at
work.

 

(b)           Salary Replacement
Benefits.  Salary
replacement benefits shall be provided to the Participant in an amount as set
forth in Schedule A appended to the Plan.

 

(c)           Bonus.

 

(i)           The Participant shall receive a cash payment equal to his
or her pro rated Annual Bonus (based on the number of full months completed
from the beginning of the fiscal year through the Separation from Service) for
the year in which Participant’s Separation from Service occurs, pursuant to the
terms set forth in the applicable incentive plans; provided, however, that to
the extent that a bonus payment for such period is paid as a result of a Change
in Control under the terms of such other incentive plan, then the amount
otherwise payable under this Section 4(c) will be offset by the
payment made under such other incentive plan.

 

(ii)          The Participant shall also receive a cash payment equal to
his or her Annual Bonus in an amount as set forth in Schedule A appended to the
Plan.

 

9

 

(d)           Medical, Dental and Health
Care Reimbursement Account Benefits.  The Participant shall continue to be eligible
to participate in the medical, dental and Health Care Reimbursement Account
coverage in effect at the date of his or her termination (or generally
comparable coverage) for himself or herself and, where applicable, his or her
spouse or domestic partner and dependents, as the same may be changed from time
to time for employees of the Company generally, as if Participant had continued
in employment during the lesser of (i) the Severance Period or (ii) twelve
(12) months.  The Participant shall be
responsible for the payment of the employee portion of the medical, dental and
Health Care Reimbursement Account contributions that are required during the
Severance Period and such contributions shall be made within the time period
and in the amounts that other employees are required to pay to the Company for
similar coverage.  The Participant’s
failure to pay the applicable contributions shall result in the cessation of
the applicable medical and dental coverage for the Participant and his or her
spouse or domestic partner and dependents. 
In the event that the Severance Period exceeds twelve months, the
Participant will receive a cash lump-sum payment from the Company equal to the
projected value of the employer portion of the premiums for medical and dental
benefits for the time period between the end of the Coverage Period and the
remainder of the Severance Period.  Such
payment shall be made within sixty (60) days following the end of the Coverage
Period.  Notwithstanding any other
provision of this Plan to the contrary, in the event that a Participant
commences employment with another company at any time during the Severance
Period, the Participant may cease receiving coverage under the Company’s
medical and dental plans.  Within thirty
(30) days of Participant’s commencement of employment with another company,
Participant shall provide the Company written notice of such employment and
provide information to the Company regarding the medical and dental benefits
provided to Participant by his or her new employer.  The COBRA continuation coverage period under
section 4980B of the Code shall run concurrently with the Severance Period.

 

(e)           Stock Options.  All stock options held by the Participant as
of his or her Separation from Service Date that were granted prior to the
Change in Control and that are not already vested and exercisable as of such
date shall become vested and exercisable upon a Change in Control
Termination.  All outstanding stock
options held by Participant that were granted prior to the Change in Control
and that are vested and exercisable as of the Separation from Service Date and
all stock options held by the Participant that become vested and exercisable
under the preceding sentence shall be exercisable for the greater of (i) the
period set forth in Participant’s option agreement covering such options, or (ii) twelve
(12) months from the Separation from Service Date.  In no event, however, shall an option be
exercisable beyond its original expiration date.

 

(f)            Restricted Stock,
Restricted Units and Performance Units.  All restricted stock, restricted stock units
and performance units held by the Participant as of his or her Separation from
Service Date shall be treated as provided under and in accordance with the Tyco
International Ltd. 2004 Stock and Incentive Plan, as amended, modified to the
extent provided in the terms and conditions of the applicable award
certificate.

 

(g)           Outplacement Services.  The Company will pay the cost of outplacement
services for the Participant for a period of twelve (12) months from
Participant’s Separation from Service Date. 
The Company shall pay the cost of outplacement services at either (i) the
outplacement agency that the Company regularly uses for such purpose or (ii) the
outplacement

 

10

 

agency selected by the Participant; provided,
however, that the Company will be responsible to pay no more than the cost that
would have been incurred had the Participant used the outplacement agency that
the Company regularly uses for such purpose.

 

(h)          Application of Other Plan
Provisions.  If any
applicable equity compensation or incentive plan or grant instrument, without
regard to (c), (e) or (f) above, provides the Participant the right
to accelerated vesting or payment of cash incentive awards, stock options,
restricted stock, restricted stock units or incentive awards, and/or an
extension of the otherwise applicable option exercise period, in the case of
termination of employment following a Change in Control, then the Participant’s
right to accelerated payment, vesting or extension of the option exercise
period shall be determined by whichever of the plan, grant instrument or the
provisions of (c), (e) or (f) above provides the most favorable
vesting or exercise rights for the Participant in such event.

 

Section 4.02         Voluntary
Resignation; Termination Due to Death or Permanent Disability. 
If the Eligible Employee’s employment terminates on account of (i) the
Eligible Employee’s Voluntary Resignation, (ii) death, or (iii) Permanent
Disability, then the Eligible Employee shall not be entitled to receive
Severance Benefits under this Plan and shall be entitled only to those benefits
(if any) as may be available under the Company’s then-existing benefit plans
and policies at the time of such termination.

 

Section 4.03         Termination for Cause.

 

(a)           If any Eligible Employee’s employment terminates on
account of termination by the Company for Cause, the Eligible Employee shall
not be entitled to receive Severance Benefits under this Plan and shall be
entitled only to those benefits that are legally required to be provided to the
Eligible Employee.  Notwithstanding any
other provision of the Plan to the contrary, if the Committee or the Plan
Administrator determines that an Eligible Employee has engaged in conduct that
constitutes Cause at any time prior to the Eligible Employee’s Separation from
Service Date, any Severance Benefits payable to the Eligible Employee under Section 4.01
of the Plan shall immediately cease, and the Eligible Employee shall be
required to return any Severance Benefits paid to the Eligible Employee prior
to such determination.  The Company may
withhold paying Severance Benefits under the Plan pending resolution of any
good faith inquiry that is likely to lead to a finding resulting in Cause.  If the Company has offset other payments owed
to the Eligible Employee under any other plan or program, it may, in its sole
discretion, waive its repayment right solely with respect to the amount of the
offset so credited.

 

(b)          Any dispute regarding a termination for Cause will be
resolved by the Plan Administrator.  Such
determination will be based on all of the facts and circumstances presented to
the Plan Administrator by the Company. 
If the Plan Administrator determines that the Eligible Employee’s
termination of employment is for Cause, then the Plan Administrator will notify
the Eligible Employee in writing of such determination, describing in detail
the reason for such determination, including without limitation the specific
conduct that constituted the basis for the determination.  The Eligible Employee shall have the right to
contest the determination of the Plan Administrator in accordance with the
Appeals Procedure described in Section 10.03.

 

11

 

Section 4.04         Reduction
of Severance Benefits.  With respect to amounts paid
under the Plan that are not subject to Code Section 409A and the
regulations promulgated thereunder, the Plan Administrator reserves the right
to make deductions in accordance with applicable law for any monies owed to the
Company by the Participant or the value of Company property that the
Participant has retained in his/her possession. 
With respect to amounts paid under the Plan that are subject to Code Section 409A
and the regulations promulgated thereunder, the Plan Administrator reserves the
right to make deductions in accordance with applicable law for any monies owed
to the Company by the Participant or the value of the Company property that the
Participant has retained in his/her possession; provided, however, that such
deduction cannot exceed $5,000 in the aggregate.

 

Section 4.05         Non-Duplication
of Benefits.  The Plan is intended to supersede, and not to
duplicate, the provisions of the Tyco International Severance Plan for U.S.
Officers and Executives (“Executive Severance Plan”) in any case in which an
Eligible Employee would otherwise be entitled to severance or related benefits
under both this Plan and the Executive Severance Plan arising out of the
Eligible Employee’s Change in Control Termination.  However, the Plan is not intended to
supersede any other plan, program, arrangement or agreement providing an
Eligible Employee with severance or related benefits in the case of an Eligible
Employee’s Change in Control Termination. 
In the event that an Eligible Employee becomes entitled to receive
benefits under this Plan and any such benefit duplicates a benefit that would
otherwise be provided under any other plan, program, arrangement or agreement
as a result of the Eligible Employee’s Change in Control Termination, then the
Eligible Employee shall be entitled to receive the greater of the benefit
available under the Plan, on the one hand, and the benefit available under such
other plan, program, arrangement or agreement, on the other.

 

ARTICLE V

 

METHOD,
DURATION AND LIMITATION OF SEVERANCE BENEFIT PAYMENTS

 

Section 5.01         Method
of Payment.  The cash Severance Benefits to which a
Participant is entitled, as determined pursuant to Section 4.01, shall be
paid in a single lump sum payment within sixty (60) days following the
Participant’s Severance from Service Date, subject to the fulfillment of all
conditions for payment set forth in Section 3.02 and subject to the
expiration of the Release revocation period specified in the Release; provided,
however, that the annual bonus amount payable pursuant to Section 4.01(c)(i) shall
be paid at the same time as bonuses would be payable under the applicable bonus
or incentive plan or program.  In no
event will interest be credited on the unpaid balance for which a Participant
may become eligible.  Payment shall be
made by mailing to the last address provided by the Participant to the Company
or such other reasonable method as determined by the Plan Administrator.  Notwithstanding the foregoing, if the
Participant’s Separation from Service is either (i) prior to the date of a
Change in Control, or (ii) following a Change in Control that does not
qualify as a “change in control” under Code Section 409A and the
regulations promulgated thereunder, then any portion of the Severance Benefits
payable under this Plan that is (i) subject to Code Section 409A and
the regulations promulgated thereunder and (ii) equals the amount of
benefit the Participant could be eligible to receive under the Executive
Severance Plan (if the Participant were to satisfy the eligibility requirements
in order to receive a benefit under that plan), shall be paid at the same time
and in

 

12

 

the same form as under the Executive Severance
Plan.  In no event will interest be
credited on the unpaid balance for which a Participant may become
eligible.  Payment shall be made by
mailing to the last address provided by the Participant to the Company or such
other reasonable method as determined by the Plan Administrator.  All payments of Severance Benefits are
subject to applicable federal, state and local taxes and withholdings.  In the event of the Participant’s death prior
to payment being made, the amount of such payment shall be paid to the
Participant’s estate in a single lump-sum payment within thirty (30) days
following the Participant’s death.

 

Section 5.02         Other
Arrangements.  The provisions of this Plan may provide for
payments to the Eligible Employee under certain compensation or bonus plans
under circumstances where such plans would not otherwise provide for payment
thereof.  It is the specific intention of
the Company that the provisions of this Plan shall supersede any provisions to
the contrary in such plans, to the extent permitted by applicable law, and such
plans shall be deemed to be have been amended to correspond with this Plan
without further action by the Company or the Board.

 

Section 5.03         Code
Section 409A.

 

(a)           Notwithstanding any provision of the Plan to the contrary,
if required by Code Section 409A and if a Participant is a Key Employee,
no Benefits shall be paid to the Participant during the Postponement
Period.  If a Participant is a Key
Employee and payment of Benefits is required to be delayed for the Postponement
Period under Code Section 409A, the accumulated amounts withheld on
account of Code Section 409A shall be paid in a lump sum payment within 30
days after the end of the Postponement Period and no interest or other
adjustment shall be made for the delayed payment.  If the Participant dies during the
Postponement Period prior to the payment of Benefits, the amounts withheld on
account of Code Section 409A shall be paid to the Participant’s estate
within thirty (30) days after the Participant’s death.

 

(b)           This Agreement is intended to meet the requirements of the
“short-term deferral” exception, the “separation pay” exception and other
exceptions under Code Section 409A and the regulations promulgated
thereunder.  Notwithstanding anything in
this Plan to the contrary, if required by Code Section 409A, payments may
only be made under this Plan upon an event and in a manner permitted by Code Section 409A,
to the extent applicable.  For purposes
of Code Section 409A, the right to a series of payments under the Plan
shall be treated as a right to a series of separate payments.  All reimbursements and in-kind benefits
provided under the Plan shall be made or provided in accordance with the
requirements of section 409A of the Code, including, where applicable, the
requirement that (i) any reimbursement is for expenses incurred during the
period of time specified in the Plan, (ii) the amount of expenses eligible
for reimbursement, or in-kind benefits provided, during a calendar year may not
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other calendar year, (iii) the reimbursement of an
eligible expense will be made no later than the last day of the calendar year
following the year in which the expense is incurred, and (iv) the right to
reimbursement or in-kind benefits is not subject to liquidation or exchange for
another benefit.  In no event may a
Participant designate the year of payment for any amounts payable under the
Plan.

 

13

 

Section 5.04         Termination
of Eligibility for Benefits.

 

(a)           All Eligible Employees shall cease to be eligible to
participate in the Plan, and all Severance Benefits payments shall cease upon
the occurrence of the earlier of:

 

(i)            Subject to Article VIII, termination or modification
of the Plan; or

 

(ii)           Completion of any obligation of the Company or its
Subsidiaries to make any payment or distribution under Article IV for the
benefit of the Participant.

 

(b)           Notwithstanding anything herein to the contrary, the
Company shall have the right to cease all Severance Benefits payments and to
recover payments previously made to the Participant should the Participant at
any time breach the Participant’s undertakings under the terms of the Plan, the
Release the Participant executed to obtain the Severance Benefits under the
Plan or the confidentiality and non-disparagement provisions of Article VI.

 

Section 5.05         Limitation
on Benefits.

 

(a)           Anything in the Plan to the contrary notwithstanding, in
the event it shall be determined that any payment or distribution by the
Company or its Subsidiaries to or for the benefit of a Participant (whether
paid or provided pursuant to the terms of this Plan or otherwise) (a “Payment”)
would be nondeductible by the Company for Federal income tax purposes because
of Section 280G of the Code, then the aggregate present value of the
benefits provided to the Participant pursuant to the rights granted under this
Plan (such benefits are hereinafter referred to as “Plan Payments”) shall be
reduced to the Reduced Amount.  The “Reduced
Amount” shall be an amount expressed in present value which maximizes the
aggregate present value of Plan Payments without causing any Payment to be
nondeductible by the Company because of Section 280G of the Code.  For purposes of this Section 5.05,
present value shall be determined in accordance with Section 280G(d)(4) of
the Code.  To the extent necessary to
eliminate an excess parachute amount that would not be deductible by the
Company for Federal income tax purposes because of Section 280G of the
Code, the amounts payable or benefits to be provided to the Participant shall
be reduced such that the economic loss to the executive as a result of the
excess parachute amount elimination is minimized.  In applying this principle, the reduction
shall be made in a manner consistent with the requirements of section 409A and
where two economically equivalent amounts are subject to reduction but payable
at different times, such amounts shall be reduced on a pro rata basis but not
below zero.

 

(b)           If the Firm (as defined in Section 5.05(c))
determines that the payments to the Participant (before any reductions as
described in Section 5.05(a)) on an after-tax basis (i.e., after federal,
state and local income and excise taxes and federal employment taxes) would
exceed the Reduced Amount on an after-tax basis (i.e., after federal, state and
local income and federal employment taxes) then such payments will not be
reduced as is described in Section 5.05(a).

 

(c)           All determinations required to be made under this Section 5.05
shall be made by a nationally recognized accounting or consulting firm selected
by the Senior Vice-President, Human Resources Tyco International Management
Company (or the equivalent) upon the occurrence of a Potential Change in
Control (the “ Firm”), which shall provide detailed

 

14

 

supporting calculations both to the Company and the
Participant within fifteen (15) business days of the Separation from Service
Date or such earlier time as is requested by the Company.  Any such determination by the Firm shall be
binding upon the Company, its successors and the Participant (subject to (e) below).  Within five (5) business days of the
determination by the Firm as to the Reduced Amount, the Company shall provide
to the Participant such Payments as are then due to the Participant in
accordance with the rights afforded under this Plan or any other applicable
plan.

 

(d)           The Company shall reimburse the Participant for any costs
or expenses of tax counsel incurred by the Participant in connection with any
audit or investigation by the Internal Revenue Service, or any state or local
tax authorities, concerning the application of Code Section 280G to any
Payments (provided, that the Participant retains tax counsel acceptable to the
Company).  In the event that as a result
of any such audit or investigation, the reduction in Plan Payments under (a) above
is finally determined not to be sufficient in amount to permit the deduction by
the Company of all Payments under Code Section 280G, then the Company
shall pay the Participant an additional amount which shall be sufficient to put
the Participant, after payment of any additional income, employment and excise
taxes, interest and penalties, in substantially the same economic position as
if the reduction had been sufficient. 
Notwithstanding anything herein to the contrary, any reimbursement or
payment pursuant to this Section 5.05(d) shall be made in a manner,
and in such timeframe, that complies with the requirements of Treasury
Regulations Section 1.409A-3(i)(1)(v).

 

(e)           In the event that the Firm determines that a reduction
effected pursuant to (a) above was excessive in amount due to changes in
relevant data or information following its original determination under (c) above
(including, without limitation, any recalculation regarding the value of stock
options as contemplated under Rev. Proc. 2003-68, Section 3.04), and that
additional Plan Payments could have been made thereunder, the Company shall promptly
make such additional payments to the Participant.

 

ARTICLE VI

 

CONFIDENTIALITY
AND NON-DISPARAGEMENT

 

Section 6.01         Confidential
Information.  The Participant agrees that he or she shall
not, directly or indirectly, use, make available, sell, disclose or otherwise
communicate to any person, other than in the course of the Participant’s
assigned duties and for the benefit of the Company, either during the period of
the Participant’s employment or at any time thereafter, any nonpublic,
proprietary or confidential information, knowledge or data relating to the
Company, any of its Subsidiaries, affiliated companies or businesses, which
shall have been obtained by the Participant during the Participant’s employment
by the Company or a Subsidiary.  The foregoing
shall not apply to information that (i) was known to the public prior to
its disclosure to the Participant; (ii) becomes known to the public
subsequent to disclosure to the Participant through no wrongful act of the
Participant or any representative of the Participant; or (iii) the
Participant is required to disclose by applicable law, regulation or legal
process (provided that the Participant provides the Company with prior notice
of the contemplated disclosure and reasonably cooperates with the Company at
its expense in seeking a protective order or other

 

15

 

appropriate protection of such information).  Notwithstanding clauses (i) and (ii) of
the preceding sentence, the Participant’s obligation to maintain such disclosed
information in confidence shall not terminate where only portions of the
information are in the public domain.

 

Section 6.02         Non-Disparagement. 
Each of the Participant and the Company (for purposes hereof, the
Company shall mean only the executive officers and directors thereof and not
any other employees) agrees not to make any statements that disparage the other
party, or in the case of the Company or its Subsidiaries, their respective
affiliates, employees, officers, directors, products or services.  Notwithstanding the foregoing, statements
made in the course of sworn testimony in administrative, judicial or arbitral
proceedings (including, without limitation, depositions in connection with such
proceedings) shall not be subject to this Section 6.02.

 

Section 6.03         Reasonableness. 
In the event the provisions of this Article VI shall ever be deemed
to exceed the time, scope or geographic limitations permitted by applicable
laws, then such provisions shall be reformed to the maximum time, scope or
geographic limitations, as the case may be, permitted by applicable laws.

 

Section 6.04         Equitable
Relief.

 

(a)           By participating in the Plan, the Participant acknowledges
that the restrictions contained in this Article VI are reasonable and necessary
to protect the legitimate interests of the Company, its Subsidiaries and its
affiliates, that the Company would not have established this Plan in the
absence of such restrictions, and that any violation of any provision of this Article VI
will result in irreparable injury to the Company.  By agreeing to participate in the Plan, the
Participant represents that his or her experience and capabilities are such
that the restrictions contained in this Article VI will not prevent the
Participant from obtaining employment or otherwise earning a living at the same
general level of economic benefit as is currently the case.  The Participant further represents and
acknowledges that (i) he or she has been advised by the Company to consult
his or her own legal counsel in respect of this Plan, and (ii) that he or
she has had full opportunity, prior to agreeing to participate in this Plan, to
review thoroughly this Plan with his or her counsel.  The Company likewise acknowledges that the
restrictions contained in Section 6.02 are necessary to protect the
legitimate interests of the Participant, and that any violation of Section 6.02
by the Company will result in irreparable injury to the Participant.

 

(b)           The Participant agrees that the Company shall be entitled
to preliminary and permanent injunctive relief, without the necessity of
proving actual damages, as well as an equitable accounting of all earnings,
profits and other benefits arising from any violation of this Article VI,
which rights shall be cumulative and in addition to any other rights or
remedies to which the Company may be entitled. 
In the event that any of the provisions of this Article VI should
ever be adjudicated to exceed the time, geographic, service, or other
limitations permitted by applicable law in any jurisdiction, then such
provisions shall be deemed reformed in such jurisdiction to the maximum time,
geographic, service, or other limitations permitted by applicable law.

 

(c)           The Participant irrevocably and unconditionally (i) agrees
that any suit, action or other legal proceeding arising out of this Article VI,
including without limitation, any

 

16

 

action commenced by the Company for preliminary and
permanent injunctive relief or other equitable relief, may be brought in the
United States District Court for the District of New York, or if such court
does not have jurisdiction or will not accept jurisdiction, in any court of
general jurisdiction in New York, (ii) consents to the non-exclusive
jurisdiction of any such court in any such suit, action or proceeding, and (iii) waives
any objection which Participant may have to the laying of venue of any such
suit, action or proceeding in any such court. 
Participant also irrevocably and unconditionally consents to the service
of any process, pleadings, notices or other papers in a manner permitted by the
notice provisions of Section 11.02.

 

Section 6.05                            Survival of Provisions. 
The obligations contained in this Article VI shall survive the
termination of Participant’s employment with the Company or a Subsidiary and
shall be fully enforceable thereafter.

 

ARTICLE VII

THE PLAN ADMINISTRATOR

 

Section 7.01                            Authority and Duties. 
It shall be the duty of the Plan Administrator, on the basis of
information supplied to it by the Company and the Committee, to properly
administer the Plan.  The Plan Administrator
shall have the full power, authority and discretion to construe, interpret and
administer the Plan, to make factual determinations, to correct deficiencies
therein, and to supply omissions.  All
decisions, actions and interpretations of the Plan Administrator shall be final,
binding and conclusive upon the parties with respect to denied claims for
Severance Benefits, except in those cases where such determination is subject
to review by the Named Appeals Fiduciary (as defined in Section 10.04).  The Plan Administrator may adopt such rules and
regulations and may make such decisions as it deems necessary or desirable for
the proper administration of the Plan.

 

Section 7.02                            Compensation of the Plan
Administrator.  The Plan Administrator appointed for periods
prior to a Potential Change in Control shall receive no compensation for
services as such.  The Plan Administrator
appointed for periods on and after a Potential Change in Control will be
entitled to receive reasonable compensation as is mutually agreed upon between
the parties.  All reasonable expenses of
the Plan Administrator shall be paid or reimbursed by the Company upon proper
documentation.  The Plan Administrator
shall be indemnified by the Company against personal liability for actions
taken in good faith in the discharge of the Plan Administrator’s duties.

 

Section 7.03                            Records, Reporting and
Disclosure.  The Plan Administrator shall keep a copy of
all records relating to the payment of Severance Benefits to Participants and
former Participants and all other records necessary for the proper operation of
the Plan.  All Plan records shall be made
available to the Committee, the Company and to each Participant for examination
during business hours except that a Participant shall examine only such records
as pertain exclusively to the examining Participant and to the Plan.  The Plan Administrator shall prepare and
shall file as required by law or regulation all reports, forms, documents and
other items required by ERISA, the Code, and every other relevant statute, each
as amended, and all regulations thereunder (except that the Company, as payor of
the Severance Benefits, shall

 

17

 

prepare and distribute to the proper recipients all
forms relating to withholding of income or wage taxes, Social Security taxes,
and other amounts that may be similarly reportable).

 

ARTICLE VIII

AMENDMENT, TERMINATION AND DURATION

 

Section 8.01                            Amendment, Suspension and
Termination.  Except as otherwise provided in this Section 8.01,
the Board or its delegee shall have the right, at any time and from time to
time prior to the occurrence of a Potential Change in Control (and after the
Potential Change in Control has expired in accordance with Section 2.26(y)),
to amend, suspend or terminate the Plan in whole or in part, for any reason or
without reason, and without either the consent of or the prior notification to
any Participant, by a formal written action. 
After the occurrence of a Potential Change in Control, the Board or its
delegee shall have the right to amend the Plan, provided however, that (a) in
no event shall any amendment give the Company the right to recover any amount
paid to a Participant prior to the date of such amendment or to cause the
cessation of Severance Benefits already approved for a Participant who has executed
a Release as required under Section 3.02 and (b) the Plan may not be
amended in any manner that adversely affects any right of a Participant or
Eligible Employee without the written consent of such Participant or Eligible
Employee.  Any amendment or termination
of the Plan must comply with all applicable legal requirements including,
without limitation, compliance with Code Section 409A and the regulations
and ruling promulgated thereunder, securities, tax, or other laws, rules,
regulations or regulatory interpretations thereof, applicable to the Plan.

 

Section 8.02                            Duration. 
The Plan shall continue in full force and effect until termination of
the Plan pursuant to Section 8.01; provided, however, that after the
termination of the Plan, if any Participants terminated employment on account
of an Involuntary Termination prior to the termination of the Plan and are
still receiving Severance Benefits under the Plan, the Plan shall remain in
effect until all of the obligations of the Company are satisfied with respect
to such Participants.

 

ARTICLE IX

DUTIES OF THE COMPANY AND THE COMMITTEE

 

Section 9.01                            Records. 
The Company or a Subsidiary thereof shall supply to the Committee all
records and information necessary to the performance of the Committee’s duties.

 

Section 9.02                            Payment. 
Payments of Severance Benefits to Participants shall be made in such
amount as determined by the Committee under Article IV, from the Company’s
general assets or from a supplemental unemployment benefits trust, in
accordance with the terms of the Plan, as directed by the Committee.

 

Section 9.03                            Discretion. 
Any decisions, actions or interpretations to be made under the Plan by
the Board, the Committee and the Plan Administrator, acting on behalf of
either, shall be

 

18

 

made in each of their respective sole discretion, not
in any fiduciary capacity and need not be uniformly applied to similarly
situated individuals and such decisions, actions or interpretations shall be
final, binding and conclusive upon all parties. 
As a condition of participating in the Plan, the Participant
acknowledges that all decisions and determinations of the Board, the Committee
and the Plan Administrator taken in good faith shall be final and binding on the
Participant, his or her beneficiaries and any other person having or claiming
an interest under the Plan on his or her behalf.

 

ARTICLE X

CLAIMS PROCEDURES

 

Section 10.01                     Claim. 
Each Participant under this Plan may contest any action taken or determination
made by the Company, the Board, the Committee or the Plan Administrator that
affects the rights of such Participant hereunder by completing and filing with
the Plan Administrator a written request for review in the manner specified by
the Plan Administrator.  No person may
bring an action for any alleged wrongful denial of Plan benefits in a court of
law unless the claims procedures described in this Article X are exhausted
and a final determination is made by the Plan Administrator and/or the Named Appeals
Fiduciary, except in circumstances where the Participant has a reasonable basis
to conclude that the pursuit of his/her claim through the claims procedure
would be futile.  If the terminated
Participant or interested person challenges a decision by the Plan
Administrator and/or Named Appeals Fiduciary, a review by the court of law will
be limited to the facts, evidence and issues presented to the Plan
Administrator during the claims procedure set forth in this Article X.  Facts and evidence that become known to the
terminated Participant or other interested person after having exhausted the
claims procedure must be brought to the attention of the Plan Administrator for
reconsideration of the claims administrator. 
Issues not raised with the Plan Administrator and/or Named Appeals
Fiduciary will be deemed waived.

 

Section 10.02                     Initial Claim. 
Before the date on which payment of Severance Benefits commences, each
application for benefits must be supported by such information as the Plan
Administrator deems relevant and appropriate. 
In the event that any claim relating to the administration of Severance
Benefits is denied in whole or in part, the terminated Participant or his or
her beneficiary (“claimant”) whose claim has been so denied shall be notified
of such denial in writing by the Plan Administrator within ninety (90) days
after the receipt of the claim for benefits. 
This period may be extended an additional ninety (90) days if the Plan
Administrator determines such extension is necessary and the Plan Administrator
provides notice of extension to the claimant prior to the end of the initial
ninety (90) day period.  The notice
advising of the denial shall specify the following: (i) the reason or
reasons for denial, (ii) make specific reference to the Plan provisions on
which the determination was based, (iii) describe any additional material
or information necessary for the claimant to perfect the claim (explaining why
such material or information is needed), and (iv) describe the Plan’s
review procedures and the time limits applicable to such procedures, including
a statement of the claimant’s right to bring a civil action under section 502(a) of
ERISA following an adverse benefit determination on review.

 

19

 

Section 10.03                     Appeals of Denied
Administrative Claims.  All appeals shall be made by
the following procedure:

 

(a)                                  A claimant
whose claim has been denied shall file with the Plan Administrator a notice of
appeal of the denial.  Such notice shall
be filed within sixty (60) calendar days of notification by the Plan
Administrator of the denial of a claim, shall be made in writing, and shall set
forth all of the facts upon which the appeal is based.

 

(b)                                 The Named
Appeals Fiduciary shall consider the merits of the claimant’s written
presentations, the merits of any facts or evidence in support of the denial of
benefits, and such other facts and circumstances as the Named Appeals Fiduciary
shall deem relevant.

 

(c)                                  The Named
Appeals Fiduciary shall render a determination upon the appealed claim which
determination shall be accompanied by a written statement as to the reasons
therefor.  The determination shall be
made to the claimant within sixty (60) days of the claimant’s request for
review, unless the Names Appeals Fiduciary determines that special
circumstances requires an extension of time for processing the claim.  In such case, the Named Appeals Fiduciary
shall notify the claimant of the need for an extension of time to render its
decision prior to the end of the initial sixty (60) day period, and the Named
Appeals Fiduciary shall have an additional sixty (60) day period to make its
determination.  The determination so
rendered shall be binding upon all parties as long as it is made in good
faith.  If the determination is adverse
to the claimant, the notice shall (i) provide the reason or reasons for
denial, (ii) make specific reference to the Plan provisions on which the
determination was based, (iii) include a statement that the claimant is
entitled to receive, upon request and free of charge, reasonable access to, and
copies of, all documents, records and other information relevant to a the
claimant’s claim for benefits, and (iv) state that the claimant has the
right to bring an action under section 502(a) of ERISA.

 

Section 10.04                     Appointment of the Named
Appeals Fiduciary.  The Named Appeals Fiduciary
shall be the person or persons named as such by the Board or Committee, or, if
no such person or persons be named, then the person or persons named by the
Plan Administrator as the Named Appeals Fiduciary; provided however, that
effective on the date of a Change in Control, the Plan Administrator shall also
serve as the Named Appeals Fiduciary. 
For periods before the date of a Change in Control, Named Appeals
Fiduciaries may at any time be removed by the Board or Committee, and any Named
Appeals Fiduciary named by the Plan Administrator may be removed by the Plan
Administrator.  All such removals may be
with or without cause and shall be effective on the date stated in the notice
of removal.  The Named Appeals Fiduciary
shall be a “Named Fiduciary” within the meaning of ERISA, and unless appointed
to other fiduciary responsibilities, shall have no authority, responsibility,
or liability with respect to any matter other than the proper discharge of the
functions of the Named Appeals Fiduciary as set forth herein.

 

Section 10.05                     Arbitration; Expenses. 
In the event of any dispute under the provisions of this Plan, other
than a dispute in which the primary relief sought is an equitable remedy such
as an injunction, the parties shall have the dispute, controversy or claim
settled by arbitration in New York, New York (or such other location as may be
mutually agreed upon by the Employer and the Participant) in accordance with
the National Rules for the Resolution of Employment

 

20

 

Disputes then in effect of the American Arbitration
Association, before a panel of three arbitrators, two of whom shall be selected
by the Company and the Participant, respectively, and the third of whom shall
be selected by the other two arbitrators. 
Any award entered by the arbitrators shall be final, binding and
nonappealable and judgment may be entered thereon by either party in accordance
with applicable law in any court of competent jurisdiction.  This arbitration provision shall be
specifically enforceable.  The
arbitrators shall have no authority to modify any provision of this Plan or to
award a remedy for a dispute involving this Plan other than a benefit
specifically provided under or by virtue of the Plan.  If the Participant substantially prevails on
any material issue, which is the subject of such arbitration or lawsuit, the
Company shall be responsible for all of the fees of the American Arbitration
Association and the arbitrators and any expenses relating to the conduct of the
arbitration (including the Company’s and Participant’s reasonable attorneys’
fees and expenses).  Otherwise, each
party shall be responsible for its own expenses relating to the conduct of the
arbitration (including reasonable attorneys’ fees and expenses) and shall share
the fees of the American Arbitration Association.

 

ARTICLE XI

MISCELLANEOUS

 

Section 11.01                     Nonalienation of Benefits. 
None of the payments, benefits or rights of any Participant shall be
subject to any claim of any creditor of any Participant, and, in particular, to
the fullest extent permitted by law, all such payments, benefits and rights
shall be free from attachment, garnishment (if permitted under applicable law),
trustee’s process, or any other legal or equitable process available to any
creditor of such Participant.  No
Participant shall have the right to alienate, anticipate, commute, plead,
encumber or assign any of the benefits or payments that he may expect to
receive, continently or otherwise, under this Plan, except for the designation
of a beneficiary as set forth in Section 5.01.

 

Section 11.02                     Notices. 
All notices and other communications required hereunder shall be in writing
and shall be delivered personally or mailed by registered or certified mail,
return receipt requested, or by overnight express courier service.  In the case of the Participant, mailed
notices shall be addressed to him or her at the home address which he or she
most recently communicated to the Company in writing.  In the case of the Company, mailed notices
shall be addressed to the Plan Administrator.

 

Section 11.03                     Successors. 
Any Successor shall assume the obligations under this Plan and expressly
agree to perform the obligations under this Plan.

 

Section 11.04                     Other Payments. 
Except as otherwise provided in this Plan, no Participant shall be
entitled to any cash payments or other severance benefits under any of the
Company’s then current severance pay policies for a termination that is covered
by this Plan for the Participant, including, without limitation, the Executive
Severance Plan.

 

Section 11.05                     No Mitigation. 
Except as otherwise provided in Section 4.01(d) and Section 4.04,
Participants shall not be required to mitigate the amount of any Severance
Benefits provided for in this Plan by seeking other employment or otherwise,
nor shall the amount of any

 

21

 

Severance Benefits provided for herein be reduced by
any compensation earned by other employment or otherwise, except if the
Participant is re-employed by Company, in which case Severance Benefits shall
cease.

 

Section 11.06                     No Contract of Employment. 
Neither the establishment of the Plan, nor any modification thereof, nor
the creation of any fund, trust or account, nor the payment of any benefits
shall be construed as giving any Eligible Employee or any person whosoever, the
right to be retained in the service of the Company, and all Eligible Employees
shall remain subject to discharge to the same extent as if the Plan had never
been adopted.

 

Section 11.07                     Severability of Provisions. 
If any provision of this Plan shall be held invalid or unenforceable by
a court of competent jurisdiction, such invalidity or unenforceability shall
not affect any other provisions hereof, and this Plan shall be construed and
enforced as if such provisions had not been included.

 

Section 11.08                     Heirs, Assigns, and
Personal Representatives.  This Plan
shall be binding upon the heirs, executors, administrators, successors and
assigns of the parties, including each Participant, present and future.

 

Section 11.09                     Headings and Captions. 
The headings and captions herein are provided for reference and
convenience only, shall not be considered part of the Plan, and shall not be
employed in the construction of the Plan.

 

Section 11.10                     Gender and Number. 
Where the context admits: words in any gender shall include any other
gender, and, except where otherwise clearly indicated by context, the singular
shall include the plural, and vice-versa.

 

Section 11.11                     Unfunded Plan. 
The Plan shall not be funded.  No
Participant shall have any right to, or interest in, any assets of the Company
that may be applied by the Company to the payment of Severance Benefits.

 

Section 11.12                     Payments to Incompetent
Persons.  Any benefit payable to or for the benefit of
a minor, an incompetent person or other person incapable of receipting therefor
shall be deemed paid when paid to such person’s guardian or to the party
providing or reasonably appearing to provide for the care of such person, and
such payment shall fully discharge the Company, the Committee and all other
parties with respect thereto.

 

Section 11.13                     Lost Payees. 
A benefit shall be deemed forfeited if the Committee is unable to locate
a Participant to whom Severance Benefits are due.  Such Severance Benefits shall be reinstated
if application is made by the Participant for the forfeited Severance Benefits
while this Plan is in operation.

 

Section 11.14                     Controlling Law. 
This Plan shall be construed and enforced according to the laws of the
State of New York to the extent not superseded by Federal law.

 

22

 

SCHEDULE
A

 

SEVERANCE
BENEFITS

SALARY REPLACEMENT AND ANNUAL BONUS

 

	
  Officers

  	
  2.99 times annual Base
  Salary and Annual Bonus

  
	
   

  	
   

  
	
  Segment Presidents

  	
  2 times annual Base Salary
  and Annual Bonus

  
	
   

  	
   

  
	
  Corporate Vice Presidents (in
  Career Band 1 or 2)

  	
  1.5 times annual Base
  Salary and Annual Bonus

  

 

A-1

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