INGERSOLL RAND CO LTD (Form: 10-K, Received: 03/02/2009 16:18:22)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the fiscal year ended December 31, 2008

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the transition period from to

Commission File No. 001-16831

INGERSOLL-RAND COMPANY LIMITED

(Exact name of registrant as specified in its charter)


Bermuda		75-2993910
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Clarendon House

2 Church Street

Hamilton HM 11, Bermuda

(Address of principal executive offices)

Registrant’s telephone number, including area code: (441) 295-2838

Securities registered pursuant to Section 12(b) of the Act:


Title of each class		Name of each exchange on which registered
Class A Common Shares,		New York Stock Exchange
Par Value $1.00 per Share

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

YES X NO

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

YES NO X

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer X		Accelerated filer

Non-accelerated filer		Smaller reporting company
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES NO X

The aggregate market value of common stock held by nonaffiliates on June 30, 2008 was approximately $11,920,220,895 based on the closing price of such stock on the New York Stock Exchange.

The number of Class A Common Shares outstanding as of February 20, 2009 was 318,864,140.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s proxy statement to be filed within 120 days of the close of the registrant’s fiscal year in connection with the registrant’s Annual General Meeting of Shareholders to be held June 3, 2009 are incorporated by reference into Part II and Part III of this Form 10-K.

Form 10-K

For the Fiscal Year Ended December 31, 2008

TABLE OF CONTENTS


			Page
Part I	Item 1.	Business	5

	Item 1A.	Risk Factors	12

	Item 1B.	Unresolved Staff Comments	20

	Item 2.	Properties	20

	Item 3.	Legal Proceedings	21

	Item 4.	Submission of Matters to a Vote of Security Holders	24

Part II	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	25

	Item 6.	Selected Financial Data	28

	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29

	Item 7A.	Quantitative and Qualitative Disclosure About Market Risk	66

	Item 8.	Financial Statements and Supplementary Data	67

	Item 9.	Changes in and Disagreements with Independent Accountants on Accounting and Financial Disclosure	68

	Item 9A.	Controls and Procedures	68

	Item 9B.	Other Information	68

Part III	Item 14.	Principal Accountant Fees and Services	69

Part IV	Item 15.	Exhibits and Financial Statements Schedule	70

	Signatures		84

CAUTIONARY STATEMENT FOR FORWARD LOOKING STATEMENTS

Certain statements in this report, other than purely historical information, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “forecast,” “outlook,” “intend,” “strategy,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” or the negative thereof or variations thereon or similar terminology generally intended to identify forward-looking statements.

Forward-looking statements may relate to such matters as projections of revenue, margins, expenses, tax provisions, earnings, cash flows, benefit obligations, share repurchases or other financial items; any statements of the plans, strategies and objectives of management for future operations, including those relating to our June 2008 acquisition of Trane Inc.; any statements concerning expected development, performance or market share relating to our products; any statements regarding future economic conditions or performance; any statements regarding pending investigations, claims or disputes, including those relating to the Internal Revenue Service audit of our consolidated subsidiaries’ tax filings in 2001 and 2002; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. These statements are based on currently available information and our current assumptions, expectations and projections about future events. While we believe that our assumptions, expectations and projections are reasonable in view of the currently available information, you are cautioned not to place undue reliance on our forward-looking statements. These statements are not guarantees of future performance. They are subject to future events, risks and uncertainties – many of which are beyond our control – as well as potentially inaccurate assumptions, that could cause actual results to differ materially from our expectations and projections.

Factors that might affect our forward-looking statements include, among other things:

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Overall economic and business conditions;

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the demand for our goods and services;

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competitive factors in the industries in which we compete;

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changes in tax requirements (including tax rate changes, new tax laws and revised tax law interpretations);

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the outcome of litigation and governmental proceedings;

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the effect of income tax audit settlements;

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the ratings on our debt and our ability to repay or refinance our outstanding indebtedness as it matures;

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our ability to operate within the limitations imposed by financing arrangements and to maintain our credit ratings;

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interest rate fluctuations and other changes in borrowing costs;

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other capital market conditions, including availability of funding sources and currency exchange rate fluctuations;

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availability of and fluctuations in the prices of key raw materials;

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economic and political conditions in international markets, including governmental changes and restrictions on the ability to transfer capital across borders;

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the ability to achieve cost savings in connection with our strategic restructuring;

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potential further impairment of our goodwill, indefinite-lived intangible assets and/or our long-lived assets;

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the impact of fluctuations in the price of our Class A common shares;

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changes in U.S. and non-U.S. governmental laws and regulations; and

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the possible effects on us of future legislation in the U.S. that may limit or eliminate potential U.S. tax benefits resulting from our incorporation in a non-U.S. jurisdiction, such as Bermuda, or deny U.S. government contracts to us based upon our incorporation in such non-U.S. jurisdiction.

Some of the material risks and uncertainties that could cause actual results to differ materially from our expectations and projections are described more fully in Item 1A “Risk Factors.” You should read that information in conjunction with “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of this report and our Consolidated Financial Statements and related notes in Item 8 of this report. We note such information for investors as permitted by the Private Securities Litigation Reform Act of 1995. There also may be other factors that have not been anticipated or that are not described in this report, generally because we do not perceive them to be material, which could cause results to differ materially from our expectations.

Forward-looking statements speak only as of the date they are made, and we do not undertake to update these forward-looking statements. You are advised, however, to review any further disclosures we make on related subjects in our periodic filings with the Securities and Exchange Commission.

PART I

Item 1. BUSINESS

Overview

Ingersoll-Rand Company Limited (IR-Limited), a Bermuda company, and its consolidated subsidiaries (we, our, the Company) is a diversified, global company that provides products, services and solutions to enhance the quality and comfort of air in homes and buildings, transport and protect food and perishables, secure homes and commercial properties, and increase industrial productivity and efficiency. Our business segments consist of Air Conditioning Systems and Services, Climate Control Technologies, Industrial Technologies and Security Technologies, each with strong brands and leading positions within their respective markets. We generate revenue and cash primarily through the design, manufacture, sale and service of a diverse portfolio of industrial and commercial products that include well-recognized, premium brand names such as Club Car ^® , Hussmann ^® , Ingersoll-Rand ^® , Schlage ^® , Thermo King ^® and Trane ^® .

We are dedicated to inspiring progress for our customers, shareholders, employees and communities by achieving:

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Dramatic Growth , by focusing on innovative solutions for our customers;

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Operational Excellence , by pursuing continuous improvement in all of our operations; and

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Dual Citizenship , by bringing together the talents of all Ingersoll Rand people to leverage the capabilities of our global enterprise.

To achieve these goals and to become a more diversified company with strong growth prospects, we transformed our enterprise portfolio by divesting cyclical, low-growth and asset-intensive businesses. In addition, our acquisition strategy has helped deliver more consistent revenue and earnings performance across all phases of the economic cycle. Aside from our portfolio transformation, we continue to focus on increasing our recurring revenue stream, which includes revenues from parts, service, used equipment and rentals. We also intend to continuously improve the efficiencies, capabilities, products and services of our high-potential businesses.

Recent Acquisitions and Divestitures

On June 5, 2008 (the Acquisition Date), we completed our acquisition of 100% of the outstanding common shares of Trane Inc. (Trane). Trane, previously named American Standard Companies Inc., provides systems and services that enhance the quality and comfort of the air in homes and buildings around the world. Trane’s systems and services have leading positions in commercial, residential, institutional and industrial markets; a reputation for reliability, high quality and product innovation; and a powerful distribution network. The total cost of the acquisition was approximately $9.6 billion, which was funded by a combination of cash on hand, commercial paper and a 364-day senior unsecured bridge loan facility.

On November 30, 2007, we completed the sale of our Bobcat, Utility Equipment and Attachments business units (collectively, Compact Equipment) to Doosan Infracore for cash proceeds of approximately $4.9 billion, subject to post-closing purchase price adjustments. Compact Equipment manufactured and sold compact equipment including skid-steer loaders, compact truck loaders, mini-excavators and telescopic tool handlers, portable air compressors, generators, light towers, general-purpose light construction equipment and attachments. We are currently in the process of resolving the final purchase price adjustments with Doosan Infracore.

On April 30, 2007, we completed the sale of our Road Development business unit to AB Volvo (publ) for cash proceeds of approximately $1.3 billion. The Road Development business unit manufactured and sold asphalt paving equipment, compaction equipment, milling machines and construction-related material handling equipment.

2001 Reorganization

Our predecessor company, Ingersoll-Rand Company (IR-New Jersey), was organized in 1905 under the laws of the State of New Jersey as a consolidation of Ingersoll-Sergeant Drill Company and the Rand Drill Company, whose businesses were established in the early 1870’s.

We are a successor to IR-New Jersey following a corporate reorganization that became effective on December 31, 2001. We believe that the reorganization has enabled us to realize a variety of financial and strategic benefits, including to:

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help enhance business growth;

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create a more favorable corporate structure for expansion of our current business;

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improve expected cash flow for use in investing in the development of higher-growth product lines and businesses;

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improve expected cash flow for use in reducing the amount of our debt;

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reduce our worldwide effective tax rate;

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enable us to implement our business strategy more effectively; and

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expand our investor base as our shares may become more attractive to non-U.S. investors.

IR-Limited and its subsidiaries continue to conduct the businesses previously conducted by IR-New Jersey and its subsidiaries. The reorganization has been accounted for as a reorganization of entities under common control and accordingly, did not result in any changes to the consolidated amounts of assets, liabilities and shareholders’ equity.

Business Segments

Our business segments provide products, services and solutions used to increase the efficiency and productivity of both industrial and commercial operations and homes, as well as improve the security, safety, health and comfort of people around the world. We have the following business segments:

Air Conditioning Systems and Services

Our Air Conditioning Systems and Services segment provides heating, ventilation and air conditioning (HVAC) systems that enhance the quality and comfort of the air in homes and buildings around the world. It offers customers a broad range of energy-efficient HVAC systems, dehumidifying and air cleaning products, service and parts support, advanced building controls as well as financing solutions under the Trane and American Standard Heating and Air Conditioning brands. These brands have leading positions in commercial, residential, institutional and industrial markets. Since the Acquisition Date, net revenues for this segment were $4.4 billion.

Climate Control Technologies

Our Climate Control Technologies segment provides equipment and services to manage controlled-temperature environments for food and other perishables throughout the world. Encompassing the transport and stationary refrigeration markets, this segment offers customers a broad range of products and solutions such as refrigerated display merchandisers, beverage coolers, auxiliary power units, walk-in storage coolers and freezers and transport temperature control units. This segment, which had 2008 net revenues of $3.4 billion, includes the market leading brands of Hussmann and Thermo King.

Industrial Technologies

Our Industrial Technologies segment provides products, services and solutions that enhance energy efficiency, productivity and operations. It offers our global customers a diverse and innovative range of products including compressed air systems, tools, pumps, fluid handling systems, golf and utility vehicles in addition to environmentally friendly micro turbines. This segment, which had 2008 net revenues of $2.9 billion, includes the Club Car and Ingersoll Rand market leading brands.

Security Technologies

Our Security Technologies segment is a leading global provider of products and services that make environments safe, secure and productive. The segment’s market-leading solutions include electronic and biometric access control systems and software, locks and locksets, door closers, exit devices, steel doors and frames, portable security devices, decorative hardware, cabinet hardware as well as time, attendance and personnel scheduling systems. These products serve a wide range of markets including the commercial construction and residential housing market, healthcare, retail, maritime and transport industries as well as educational and governmental facilities. This segment, which had 2008 net revenues of $2.5 billion, includes the CISA, LCN, Schlage and Von Duprin brands.

Products

Our principal products by business segment include the following:


Air Conditioning Systems and Services
Air cleaners		Evaporator coils
Air conditioners		Furnaces
Air exchangers		Heat pumps
Air handlers		Humidifiers
Airside and terminal devices		Package heating and cooling systems
Applied systems		Thermostats/controls
Boilers		Unitary systems


Climate Control Technologies
Aftermarket parts and service		Auxiliary idle reduction
Bus and rail HVAC systems		Auxiliary temperature management
Coils and condensers		Refrigeration and electrical houses
Containers and gensets		Refrigeration systems
Cryogenic temperature control systems		Surface and air sanitation
Diesel-powered temprature control systems		Vehicle-powered truck refrigeration systems
Display merchandisers		Walk-in coolers and freezers


Industrial Technologies
Air balancers		Fluid-handling equipment
Air compressors & accessories		Golf vehicles
Air treatment		Lubrication equipment
Air motors		Material handling equipment
Air and electric tools		Microturbines
Blowers		Piston pumps
Diaphragm pumps		Utility vehicles
Engine-starting systems


Security Technologies
Automatic doors		Electrical security products
Biometric access control systems		Electronic access-control systems
Door closers and controls		Exit devices
Door locks, latches and locksets		Portable security products
Doors and door frames (steel)

These products are sold primarily under our name and under other names including American Standard ^® , CISA ^® , Club Car ^® , Hussmann ^® , LCN ^® , Schlage ^® , Thermo King ^® , Von Duprin ^® and Trane ^® .

Competitive Conditions

Our products are sold in highly competitive markets throughout the world. Due to the diversity of these products and the variety of markets served, we encounter a wide variety of competitors that vary by product line. They include well-established regional or specialized competitors, as well as larger U.S and non-U.S corporations or divisions of larger companies.

The principal methods of competition in these markets relate to price, quality, delivery, service and support, technology and innovation. We believe that we are one of the leading manufacturers in the world of HVAC systems and services, air compression systems, transport temperature control products, refrigerated display merchandisers, refrigeration systems and controls, air tools, and golf and utility vehicles. In addition, we believe we are a leading supplier in U.S. markets for architectural hardware products, mechanical locks and electronic and biometric access-control technologies.

Distribution

Our products are distributed by a number of methods, which we believe are appropriate to the type of product. U.S. sales are made through branch sales offices and through distributors, dealers and large retailers across the country. Non-U.S. sales are made through numerous subsidiary sales and service companies with a supporting chain of distributors throughout the world.

Customers

We have no major customers that accounted for more than 10% of our consolidated net revenues in 2008, 2007 or 2006. No material part of our business is dependent upon a single customer or a small group of customers; therefore, the loss of any one customer would not have a material adverse effect on our operations.

Raw Materials

We manufacture many of the components included in our products, which requires us to employ a wide variety of raw materials. Principal raw materials, such as steel, copper and aluminum, are purchased from a large number of independent sources around the world. In the past, higher prices for some raw materials, particularly steel and non-ferrous metals, have caused pricing pressures in some of our businesses; we have historically been able to pass certain of these cost increases on to customers in the form of price increases.

We believe that available sources of supply will generally be sufficient for the foreseeable future. There have been no raw material shortages which have had a material adverse effect on our businesses. However, significant changes in certain material costs may have an adverse impact on our costs and operating margins. To mitigate this potential impact, we enter into long-term supply contracts in order to manage our exposure to potential supply disruptions.

Working Capital

We manufacture products that usually must be readily available to meet our customer’s rapid delivery requirements. Therefore, we maintain an adequate level of working capital to support our business needs

and our customers’ requirements. Such working capital requirements are not, however, in the opinion of management, materially different from those experienced by our major competitors. Our sales and payment terms are generally similar to those of our competitors.

Research and Development

We engage in research and development activities in an effort to introduce new products, enhance existing products effectiveness, increase safety, improve ease of use and reliability as well as expand the various applications for which our products may be appropriate. In addition, we continually evaluate developing technologies in areas that we believe will enhance our business for possible investment or acquisition. We anticipate that we will continue to make significant expenditures for research and development activities as we look to maintain and improve our competitive position. Research and development expenditures, including qualifying engineering costs, were $131.6 million in 2008, $128.6 million in 2007 and $126.7 million in 2006.

Patents and Licenses

We own numerous patents and patent applications and are licensed under others. Although in aggregate we consider our patents and licenses to be valuable to our operations, we do not believe that our business is materially dependent on a single patent or license or any group of them. In our opinion, engineering, production skills and experience are more responsible for our market position than our patents and/or licenses.

Operations by Geographic Area

More than 40% of our 2008 net revenues were derived outside the U.S. and we sold products in more than 100 countries. Therefore, the attendant risks of manufacturing or selling in a particular country, such as nationalization and establishment of common markets, would not be expected to have a significant effect on our non-U.S. operations. For a discussion of risks attendant to our non-U.S. operations, see “Risk Factors – Currency exchange rate and commodity price fluctuations may adversely affect our results,” “Risk Factors – Our global operations subject us to economic risks,” in Item 1A and “Quantitative and Qualitative Disclosure about Market Risk” in Item 7A.

Backlog

Our approximate backlog of orders, believed to be firm, at December 31, 2008 and 2007, were as follows:


Dollar amounts in millions		2008		2007
Air Conditioning Systems and Services	$	981.8	$	-
Climate Control Technologies		342.4		507.2
Industrial Technologies		367.7		429.8
Security Technologies		188.0		216.5
Total	$	1,879.9	$	1,153.5

These backlog figures are based on orders received. While the major portion of our products are built in advance of order and either shipped or assembled from stock, orders for specialized machinery or specific customer application are submitted with extensive lead times and are often subject to revision, deferral, cancellation or termination. We expect to ship substantially the entire backlog at December 31, 2008 during 2009.

Environmental Matters

We continue to be dedicated to an environmental program intended to reduce the utilization and generation of hazardous materials during the manufacturing process as well as to remediate identified

environmental concerns. As to the latter, we are currently engaged in site investigations and remediation activities to address environmental cleanup from past operations at current and former manufacturing facilities.

We are sometimes a party to environmental lawsuits and claims and have received notices of potential violations of environmental laws and regulations from the Environmental Protection Agency and similar state authorities. We have been also identified as a potentially responsible party (PRP) for cleanup costs associated with off-site waste disposal at federal Superfund and state remediation sites. For all such sites, there are other PRPs and, in most instances, our involvement is minimal.

In estimating our liability, we have assumed that we will not bear the entire cost of remediation of any site to the exclusion of other PRPs who may be jointly and severally liable. The ability of other PRPs to participate has been taken into account, based generally on the parties’ financial condition and probable contributions on a per site basis. Additional lawsuits and claims involving environmental matters are likely to arise from time to time in the future.

During 2008, we spent $6.9 million on capital projects for pollution abatement and control, and an additional $15.5 million for environmental remediation expenditures at sites presently or formerly owned or leased by us. As of December 31, 2008, we have recorded reserves for environmental matters of $100.9 million. We believe that these expenditures and accrual levels will continue and may increase over time. Given the evolving nature of environmental laws, regulations and technology, the ultimate cost of future compliance is uncertain.

For a further discussion of our potential environmental liabilities, see also Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, Environmental and Asbestos Matters and also Note 22 to the consolidated financial statements.

Asbestos Matters

Certain wholly owned subsidiaries of the Company are named as defendants in asbestos-related lawsuits in state and federal courts. In virtually all of the suits, a large number of other companies have also been named as defendants. The vast majority of those claims has been filed against either Ingersoll-Rand Company (IR-New Jersey) or Trane and generally allege injury caused by exposure to asbestos contained in certain historical products sold by IR-New Jersey or Trane, primarily pumps, boilers and railroad brake shoes. Neither IR-New Jersey nor Trane was a producer or manufacturer of asbestos, however, some formerly manufactured products utilized asbestos-containing components such as gaskets and packings purchased from third-party suppliers.

Prior to the fourth quarter of 2007, we recorded a liability (which we periodically updated) for our actual and anticipated future asbestos settlement costs projected seven years into the future. We did not record a liability for future asbestos settlement costs beyond the seven-year period covered by our reserve because such costs previously were not reasonably estimable for the reasons detailed below.

In the fourth quarter of 2007, we again reviewed our history and experience with asbestos-related litigation and determined that it had now become possible to make a reasonable estimate of our total liability for pending and unasserted potential future asbestos-related claims. This determination was based upon our analysis of developments in asbestos litigation, including the substantial and continuing decline in the filing of non-malignancy claims against us, the establishment in many jurisdictions of inactive or deferral dockets for such claims, the decreased value of non-malignancy claims because of changes in the legal and judicial treatment of such claims, increasing focus of the asbestos litigation upon malignancy claims, primarily those involving mesothelioma, a cancer with a known historical and predictable future annual incidence rate, and our substantial accumulated experience with respect to the

resolution of malignancy claims, particularly mesothelioma claims, filed against us. With the aid of an outside expert, we have estimated our total liability for pending and unasserted future asbestos-related claims through 2053 at $755 million.

As a result, we recorded a non-cash charge to earnings of discontinued operations of $449 million ($277 million after-tax) which is the difference between the amount by which we increased our total estimated liability for pending and projected future asbestos-related claims and the amount that we expect to recover from insurers with respect to that increased liability.

In connection with our acquisition of Trane, we retained an outside expert to assist in calculating Trane’s asbestos-related valuations of current and future liabilities. As required by Statement of Financial Accounting Standards No. 141, “Business Combinations,” we are required to record the assumed asbestos obligations and associated insurance-related assets at their fair value at the Acquisition Date. We estimated that the assumed asbestos obligation and associated insurance-related assets at the Acquisition Date were $494 million and $249 million, respectively. These amounts were estimated based on certain assumptions and factors consistent with those described above.

For a further discussion of asbestos matters, see also Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, Environmental and Asbestos Matters and also Note 22 to the consolidated financial statements.

Employees

As a result of the acquisition of Trane in the second quarter of 2008, we increased our workforce by approximately 30,000 people. As of December 31, 2008, we employed approximately 60,000 people throughout the world.

Available Information

We file annual, quarterly, and current reports, proxy statements, and other documents with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934. The public may read and copy any materials filed with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The public can obtain any documents that are filed by us at http://www.sec.gov.

In addition, this Annual Report on Form 10-K, as well as our quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to all of the foregoing reports, are made available free of charge on our Internet website ( http://www.ingersollrand.com ) as soon as reasonably practicable after such reports are electronically filed with or furnished to the SEC. The Board of Directors of the Company has also adopted and posted in the Investor Relations section of its website our Corporate Governance Guidelines and charters for each of the Board’s standing committees. A copy of the above filings will also be provided free of charge upon written request to us.

Certifications

New York Stock Exchange Annual Chief Executive Officer Certification

The Company’s Chief Executive Officer submitted to the New York Stock Exchange the Annual CEO Certification as the Company’s compliance with the New York Stock Exchange’s corporate governance listing standards required by Section 303A.12 of the New York Stock Exchange’s listing standards.

Sarbanes-Oxley Act Section 302 Certification

The certifications of the Chief Executive Officer and Chief Financial Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 have been filed as exhibits to this Annual Report on Form 10-K.

Item 1A. RISK FACTORS

The following are certain risk factors that could affect our business, financial condition, results of operations, and cash flows. These risk factors should be considered in connection with evaluating the forward-looking statements contained in this Annual Report on Form 10-K because these factors could cause the actual results and conditions to differ materially from those projected in forward-looking statements. Before you invest in our publicly traded securities, you should know that making such an investment involves some risks, including the risks described below. If any of the risks actually occur, our business, financial condition or results of operations could be negatively affected. In that case, the trading price of our Class A common shares could decline, and you may lose all or part of your investment.

Risks Relating to Our Businesses

Macroeconomic conditions, negative conditions in the financial, insurance and credit markets and changes in our credit ratings subject us to a number of risks.

The world financial markets have been experiencing extreme disruption in recent months, including, among other things, extreme volatility in security prices, severely diminished liquidity and credit availability, rating downgrades of certain investments and declining valuations of others. Governments have taken unprecedented actions intended to address extreme market conditions that include severely restricted credit and declines in asset values. While these conditions have not currently impaired our ability to access credit markets, insurance and finance our operations, there can be no assurance that there will not be further deterioration in the world financial markets, continued negative conditions in the global credit markets or a loss of confidence in the major economies, any of which may make it more difficult for us to obtain financing for our operations or increase the cost of obtaining financing as well as access insurance to manage risk.

In addition, our investment-grade credit ratings currently afford us lower borrowing rates on commercial paper, revolving credit agreements and debt offerings. Increased debt levels and/or decreased earnings could result in downgrades in our credit ratings, which, in turn, could impede access to the credit markets, reduce the total amount of commercial paper we could issue, raise our commercial paper borrowing costs and/or raise our long-term debt borrowing rates.

Finally, many of our customers rely on credit financing in order to purchase our products. If the tightening of credit in financial markets continues to adversely affect the ability of our customers to obtain financing for significant purchases, this could result in a further decrease in or cancellation of orders for our products and services. Our global business is also adversely affected by decreases in the general level of economic activity and in business and consumer spending.

We may not realize the expected financial benefits from the acquisition of Trane Inc. and from our announced restructuring actions and this could have a material adverse effect on our business.

On June 5, 2008, we completed our acquisition of Trane. There are potential risks associated with growing our business through acquisitions such as our acquisition of Trane, including the failure to successfully integrate and realize the expected benefits of an acquisition. For example, with any acquisition and subsequent integration, there is the possibility that:

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the business culture of the acquired business may not match well with our culture;

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technological and product synergies, economies of scale and cost reductions may not occur as expected;

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management may be distracted from overseeing existing operations by the need to integrate acquired businesses;

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we may be unable to maintain or increase the revenue growth rate of the acquired business;

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we may acquire or assume unexpected liabilities;

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unforeseen difficulties may arise in integrating operations and systems;

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we may fail to retain and assimilate employees of the acquired business; and

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we may experience problems in retaining customers and integrating customer bases.

Additionally, we previously announced restructuring actions to deal with slowing end market demand and we must implement these restructuring actions during this integration period. If we are unable to integrate our businesses successfully or implement these restructuring actions effectively, then we may fail to realize the anticipated synergies and growth opportunities or achieve the cost savings and revenue growth we anticipated from these actions and this could have a material adverse effect on our business.

We are relying on an indemnification agreement with respect to any potential liability arising from a European Commission Investigation into possible infringement of European Union competition law by Trane and its subsidiaries. If we were unable to rely on the indemnification agreement for any reason, any potential liability arising from the European Commission Investigation could have a material adverse effect on our financial condition and results of operations.

In connection with Trane’s spinoff of the Vehicle Control Systems business into a new publicly traded company called WABCO Holdings Inc. (WABCO) in July 31, 2007, Trane entered into an Indemnification and Cooperation Agreement (Indemnification Agreement) with, among others, American Standard Europe BVBA (renamed WABCO Europe BVBA) (WABCO Europe), which became a subsidiary of WABCO following the spinoff. Pursuant to the Indemnification Agreement, WABCO Europe has agreed to indemnify Trane and its subsidiaries and their respective affiliates against any fines related to the European Commission Investigation. For a further discussion of European Commission Investigation, see “Legal Proceedings.” If the European Commission were to impose the maximum fine allowable pursuant to applicable guidelines, the total liability to the Company could be approximately $1.1 billion based on Trane’s worldwide revenue in 2007, subject to a probable reduction for leniency of at least 20 percent (provided WABCO Europe, as the leniency applicant, fulfilled all conditions set forth in the European Commission’s leniency notice). WABCO has stated in its Form 10-K for the fiscal year ended December 31, 2008 that its ability to satisfy its obligations under the Indemnification Agreement is contingent on its funding capability at the time of the fine, which could be affected by, among other things, its ability to access its then existing credit facilities, its ability to obtain alternative sources of financing, its ability to obtain some payment relief from the European Commission or its ability to obtain a suspension of the payment obligation from the European Court of First Instance. If WABCO Europe were unable to satisfy its obligations under the Indemnification Agreement or if we were unable to rely on the Indemnification Agreement for any reason, any potential liability arising from the European Commission Investigation could have a material adverse effect on our financial condition and results of operations.

Our global operations subject us to economic risks.

Our global operations are dependent upon products manufactured, purchased and sold in the U.S. and internationally, including China, Brazil, Africa and Eastern Europe. These activities are subject to risks that are inherent in operating globally, including the following:

•

countries could change regulations or impose currency restrictions and other restraints;

•

in some countries, there is a risk that the government may expropriate assets;

•

some countries impose burdensome tariffs and quotas;

•

national and international conflict, including terrorist acts, could significantly impact our financial condition and results of operations; and

•

economic downturns, political instability and war or civil disturbances may disrupt production and distribution logistics or limit sales in individual markets.

Currency exchange rate and commodity price fluctuations may adversely affect our results.

We are exposed to a variety of market risks, including the effects of changes in non-U.S. currency exchange rates, commodity prices and interest rates. See Part II Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

More than 40% of our 2008 net revenues were derived outside the U.S., and we expect sales to non-U.S. customers to continue to represent a significant portion of our consolidated net revenues. Although we enter into currency exchange contracts to reduce our risk related to currency exchange fluctuations, changes in the relative values of currencies occur from time to time and may, in some instances, have a significant effect on our results of operations. Because we do not hedge against all of our currency exposure, our business will continue to be susceptible to currency fluctuations.

Furthermore, the reporting currency for our financial statements is the U.S. dollar. We have assets, liabilities, revenues and expenses denominated in currencies other than the U.S. dollar. To prepare our consolidated financial statements, we must translate those assets, liabilities, revenues and expenses into U.S. dollars at the applicable exchange rates. Consequently, increases and decreases in the value of the U.S. dollar versus other currencies will affect the amount of these items in our consolidated financial statements, even if their value has not changed in their original currency.

We are also a large buyer of steel and non-ferrous metals, as well as other commodities required for the manufacture of our products. Volatility in the prices of these commodities could increase the costs of our products and services. We may not be able to pass on these costs to our customers and this could have a material adverse effect on our results of operations and cash flows. On a limited basis, we purchase commodity derivatives which reduce the volatility of the commodity prices for supplier contracts where fixed pricing is not available.

Significant shortages in the raw materials we use in our businesses and higher energy prices could increase our operating costs.

We rely on suppliers to secure raw materials, particularly steel and non-ferrous metals, required for the manufacture of our products. A disruption in deliveries from our suppliers or decreased availability of raw materials or commodities could have an adverse effect on our ability to meet our commitments to

customers or increase our operating costs. We believe that available sources of supply will generally be sufficient for our needs for the foreseeable future. Nonetheless, the unavailability of some raw materials may have an adverse effect on our results of operations or financial condition.

Additionally, we are exposed to large fluctuations for the price of petroleum-based fuel due to the instability of current market prices. Higher energy costs increase our operating costs and the cost of shipping our products to customers around the world. Consequently, sharp price increases, the imposition of taxes or an interruption of supply, could cause us to lose the ability to effectively manage the risk of rising fuel prices and may have an adverse effect on our results of operations or financial condition.

Changes in weather patterns and seasonal fluctuations may adversely affect certain segments of the Company’s business and impact overall results of operations.

Demand for certain segments of the Company’s products and services is influenced by weather conditions. For instance, Trane’s sales have historically tended to be seasonally higher in the second and third quarters of the year because, in the U.S. and other northern hemisphere markets, summer is the peak season for sales of air conditioning systems and services. Additionally, while there is demand for Trane’s products and services throughout the year, a significant percentage of total sales are related to U.S. residential and commercial construction activity, which is generally higher in the second and third quarters of the year. Therefore, results of any quarterly period may not be indicative of expected results for a full year and unexpected cool trends or unseasonably warm trends during the summer season could negatively or positively affect certain segments of the Company’s business and impact overall results of operations.

We face continuing risks relating to compliance with the Foreign Corrupt Practices Act (FCPA)

On November 10, 2004, the Securities and Exchange Commission (SEC) issued an Order directing that a number of public companies, including us, provide information relating to their participation in certain transactions under the United Nations’ Oil for Food Program. Upon receipt of the Order, we undertook a thorough review of our participation in the Oil for Food Program and provided the SEC with information responsive to its investigation of our participation in the program. On October 31, 2007, we announced that we had reached settlements with the SEC and the Department of Justice (DOJ) relating to certain payments made by our foreign subsidiaries in 2000-2003 in connection with the Oil for Food Program. Pursuant to the settlements with the SEC and DOJ, we have, among other things, (i) consented to the entry of a civil injunction in the SEC action, (ii) entered into a three-year deferred prosecution agreement (DPA) with the DOJ, and (iii) agreed to implement improvements to our compliance program designed to enhance detection and prevention of violations of the FCPA and other applicable anti-corruption laws. If the DOJ determines, in its sole discretion, that we have committed a federal crime or have otherwise breached the DPA during its three-year term, we may be subject to prosecution for any federal criminal violation of which the DOJ has knowledge, including, without limitation, violations of the FCPA in connection with the Oil for Food Program. Breaches of the settlements with SEC and DOJ may also subject us to, among other things, further enforcement actions by the SEC or the DOJ, securities litigation and a general loss of investor confidence, any one of which could adversely affect our business prospects and the market value of our stock. For a further discussion of the settlements with the SEC and DOJ, see “Legal Proceedings.”

Furthermore, we have reported to the DOJ and SEC that we are currently investigating certain matters involving Trane, including one relating to the Oil for Food Program, and which raise potential issues under the FCPA and other applicable anti-corruption laws. We have indicated to the SEC and DOJ that we are conducting a thorough investigation of these matters and that we would report back to them with our findings. The investigation of these matters began in earnest promptly after our acquisition of Trane

in June 2008 and is currently in progress. Previously, we had reported to the SEC and DOJ potential FCPA issues relating to one of our businesses in China, and we have reported back to them and shared with them our audit report, which indicated no FCPA violations. These matters (and other matters which may arise or of which we become aware in the future) may be deemed to violate the FCPA and other applicable anti-corruption laws. Such determinations could subject us to, among other things, further enforcement actions by the SEC or the DOJ (if, for example, the DOJ deems us to have violated the DPA), securities litigation and a general loss of investor confidence, any one of which could adversely affect our business prospects and the market value of our stock.

Material adverse legal judgments, fines, penalties or settlements could adversely affect our financial health.

We estimate that our available cash and our cash flow from operations will be adequate to fund our operations for the foreseeable future. In making this estimate, we have not assumed the need to make any material payments in connection with any pending litigation or investigations. As required by generally accepted accounting principles in the United States, we establish reserves based on our assessment of contingencies. Subsequent developments in legal proceedings, including current or future asbestos-related litigation, may affect our assessment and estimates of the loss contingency recorded as a reserve and we may be required to make additional material payments, which could result in an adverse effect on our results of operations.

Such an outcome could have important consequences. For example, it could:

•

increase our vulnerability to general adverse economic and industry conditions;

•

limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate;

•

restrict our ability to exploit business opportunities; and

•

make it more difficult for us to satisfy our payment obligations with respect to our outstanding indebtedness.

If the distribution of WABCO’s shares by Trane on July 31, 2007 were to fail to qualify as tax-free for U.S. federal income tax purposes under Section 355 of the Internal Revenue Code (the Code), then Trane may be required to pay U.S. federal income taxes as well as Trane’s shareholders who received WABCO common stock in the distribution.

On July 31, 2007, Trane (then known as American Standard Companies Inc.) completed the spinoff of its vehicle control systems business into a new publicly traded company named WABCO. At the time, Trane received a private letter ruling from the Internal Revenue Service (IRS) substantially to the effect that the distribution qualified as tax-free for U.S. federal income tax purposes under Section 355 of the Code. In addition, Trane received an opinion of Skadden, Arps, Slate, Meagher & Flom LLP, tax counsel to Trane, substantially to the effect that the distribution will qualify as tax-free to Trane, WABCO and Trane shareholders under Section 355 and related provisions of the Code. The ruling and opinion were based on, among other things, certain assumptions as well as on the accuracy of certain factual representations and statements made by WABCO and Trane. In rendering its ruling, the IRS also relied on certain covenants that Trane and WABCO entered into, including the adherence to certain restrictions on WABCO’s and Trane’s future actions.

In connection with our acquisition of Trane in June 2008, we received an opinion of Simpson Thacher & Bartlett LLP, tax counsel to us, substantially to the effect that the distribution should continue to qualify

as tax-free to Trane, WABCO and Trane shareholders under Section 355 and related provisions of the Code. Notwithstanding receipt by Trane and us of the private letter ruling as well as the opinions of counsel, there can be no assurance that the IRS will not later assert that the distribution should be treated as a taxable transaction.

If the distribution fails to qualify for tax-free treatment, then Trane would recognize a gain in an amount equal to the excess of (i) the fair market value of WABCO’s common stock distributed to the Trane shareholders over (ii) Trane’s tax basis in such common stock. Under the terms of the Tax Sharing Agreement, in the event the distribution were to fail to qualify as a tax-free reorganization and such failure was not the result of actions taken after the distribution by Trane or any of its subsidiaries or shareholders, WABCO would be responsible for all taxes imposed on Trane as a result thereof. In addition, each Trane shareholder who received WABCO common stock in the distribution generally would be treated as having received a taxable distribution in an amount equal to the fair market value of WABCO’s common stock received (including any fractional share sold on behalf of the shareholder), which would be taxable as a dividend to the extent of the shareholder’s ratable share of Trane’s current and accumulated earnings and profits at the time (as increased to reflect any current income including any gain recognized by Trane on the taxable distribution). The balance, if any, of the distribution would be treated as a nontaxable return of capital to the extent of the Trane shareholder’s tax basis in its Trane stock, with any remaining amount being taxed as capital gain.

Risks Relating to Our Reorganization as a Bermuda Company

The reorganization exposed us and our shareholders to the risks described below. In addition, we cannot be assured that all of the anticipated benefits of the reorganization will be realized.

Changes in tax laws, changes in our status under U.S. or other tax laws or adverse determinations by taxing authorities could increase our tax burden or otherwise affect our financial condition or operating results, as well as subject our shareholders to additional taxes.

The realization of any tax benefit related to our reorganization could be impacted by changes in tax laws, tax treaties or tax regulations or the interpretation or enforcement thereof by the IRS or any other tax authority. From time to time, proposals have been made and/or legislation has been introduced to change the U.S. tax law that if enacted could increase our tax burden and could have a material adverse impact on our financial condition and results of operations. For instance, recent legislative proposals would broaden the circumstances under which we would be considered a U.S. resident, which would significantly diminish the realization of any tax benefit related to our reorganization. Other legislative proposals could override certain tax treaties and limit the treaty benefits on certain payments by our U.S. subsidiaries to our non-U.S. affiliates, which would adversely affect our effective tax rate. We cannot predict the outcome of any specific legislation. While we are currently monitoring these proposals and are investigating all options, we could still be subject to increased U.S. taxation on a going forward basis no matter what action we undertake if certain legislative proposals are enacted and/or certain tax treaties are amended.

While our U.S. operations are subject to U.S. tax, we believe that a significant portion of our non-U.S. operations are generally not subject to U.S. tax other than withholding taxes. Our conclusions are based on, among other things, our determination that we, and a significant portion of our foreign subsidiaries, are not currently controlled foreign corporation’s (CFC) within the meaning of the U.S. tax laws, although the IRS or a court may not concur with our conclusions. A non-U.S. corporation, such as us, will constitute a CFC for U.S. federal income tax purposes if certain ownership criteria are met. If the IRS or a court determined that we (or any of our non-U.S. subsidiaries) were a CFC, then each of our

U.S. shareholders who own (directly, indirectly, or constructively) 10% or more of the total combined voting power of all classes of our stock (or the stock of any of our non-U.S. subsidiaries) on the last day of the applicable taxable year (a “10% U.S. Voting Shareholder”) would be required to include in gross income for U.S. federal income tax purposes its pro rata share of our subpart F and other similar types of income (and the subpart F and other similar types of income of any of our subsidiaries determined to be a CFC) for the period during which we (and our non-U.S. subsidiaries) were a CFC. In addition, gain on the sale of our shares realized by such a shareholder may be treated as ordinary income to the extent of the shareholder's proportionate share of our and our CFC subsidiaries' undistributed earnings and profits accumulated during the shareholder's holding period of the shares while we (or any of our non-U.S. subsidiaries) are a CFC. Treatment of us or any of our non-U.S. subsidiaries as a CFC could have a material adverse impact on our financial condition and results of operations.

On July 20, 2007, we, and our consolidated subsidiaries, received a notice from the IRS containing proposed adjustments to our consolidated subsidiaries’ tax filings in connection with an audit of the 2001 and 2002 tax years. The IRS did not contest the validity of our reincorporation in Bermuda. The most significant adjustments proposed by the IRS involve treating the entire intercompany debt incurred in connection with our reincorporation in Bermuda as equity. As a result of this recharacterization, the IRS has disallowed the deduction of interest paid on the debt and imposed dividend withholding taxes on the payments denominated as interest. Proposed adjustments on this issue, if upheld in their entirety, would result in additional taxes with respect to the 2002 tax year of approximately $190 million plus interest and would require us to record additional charges associated with this matter. For a further discussion of the IRS audit, see “Legal Proceedings” and Note 19 to the consolidated financial statements.

We strongly disagree with the view of the IRS and are vigorously contesting these proposed adjustments. Although the outcome of this matter cannot be predicted with certainty, based upon an analysis of the strength of our position, we believe that we have adequately reserved for this matter. At this time, the IRS has not yet begun their examination of our consolidated subsidiaries’ tax filings for years subsequent to the 2002 tax year. We believe it likely, if the above adjustments or a portion of such adjustments by the IRS are ultimately sustained, that these adjustments will also affect subsequent tax years.

As noted above, the IRS did not contest the validity of our reincorporation in Bermuda in the above-mentioned notice. We believe that neither we nor our consolidated subsidiary IR-New Jersey will incur significant U.S. federal income or withholding taxes as a result of the transfer of the shares of our subsidiaries that occurred as part of the reorganization. However, we cannot give any assurances that the IRS will agree with our determination.

The inability to realize any anticipated tax benefits related to our reorganization, discussed above in this section “Risks Relating to our Reorganization as a Bermuda Company”, could have a material adverse impact on our financial condition and results of operations.

Legislation regarding U.S. companies which reincorporate or have reincorporated outside the U.S. could adversely affect us and our subsidiaries.

The U.S. federal government and various states and municipalities have enacted or may enact legislation intended to deny government contracts to U.S. companies that reincorporate outside of the U.S. or have reincorporated outside of the U.S.

For instance, the Homeland Security Act of 2002, as amended, includes a provision that prohibits “inverted domestic corporations” and their subsidiaries from entering into contracts with the Department

of Homeland Security. In addition, the State of California adopted legislation intended to limit the eligibility of certain non-U.S. chartered companies to participate in certain state contracts. More recently, the 2008 Consolidated Appropriations Act, which became effective in December 2007, prohibits any federal government agency from using funds appropriated by Congress for fiscal year 2008 to pay an inverted domestic corporation or any of its subsidiaries for work performed or products provided under certain federal contracts (“Affected Contracts”). Although the amount of monies already paid to us or to be paid to us under the Affected Contracts is not material to the Company, we cannot provide any assurance that the impact of future actions taken by the government in this area will not be materially adverse to our operations.

Bermuda law differs from the laws in effect in the United States and may afford less protection to holders of our securities.

We are organized under the laws of Bermuda. It may not be possible to enforce court judgments in Bermuda that are obtained in the U.S. against us or our directors or officers in Bermuda based on the civil liability provisions of the U.S. federal or state securities laws. We have been advised that the U.S. and Bermuda do not currently have a treaty providing for the reciprocal recognition and enforcement of judgments in civil and commercial matters. Therefore, a final judgment for the payment of money rendered by any U.S. federal or state court based on civil liability, whether or not based solely on U.S. federal or state securities laws, would not automatically be enforceable in Bermuda.

In addition, as a result of Bermuda law, it would be difficult for a holder of our securities to effect service of process within the United States. However, we have irrevocably agreed that we may be served with process with respect to actions based on offers and sales of securities made in the United States by having Ingersoll-Rand Company, 155 Chestnut Ridge Road, Montvale, New Jersey 07645, be our U.S. agent appointed for that purpose.

Bermuda companies are governed by the Companies Act 1981 of Bermuda, which differs in some material respects from laws generally applicable to U.S. corporations and shareholders, including, among others, differences relating to interested director and officer transactions, shareholder lawsuits and indemnification. Under Bermuda law, the duties of directors and officers of a Bermuda company are generally owed to the company only. Shareholders of Bermuda companies do not generally have rights to take action against directors or officers of the company, and may only do so in limited circumstances. Under Bermuda law, a company may also agree to indemnify directors and officers for any personal liability, not involving fraud or dishonesty, incurred in relation to the company. Thus, our shareholders may have more difficulty protecting their interests than would holders of securities of a corporation incorporated in a jurisdiction of the U.S.

Item 1B. UNRESOLVED STAFF COMMENTS

None.

Item 2. PROPERTIES

As of December 31, 2008, we owned or leased a total of approximately 22.1 million square feet of space worldwide. Manufacturing and assembly operations are conducted in 47 plants in the United States; 28 plants in Europe; 18 plants in Asia; 10 plants in Latin America; and 1 plant in Canada. We also maintain various warehouses, offices and repair centers throughout the world.

Substantially all plant facilities are owned by us with the remainder under long-term lease arrangements. We believe that our plants have been well maintained, are generally in good condition and are suitable for the conduct of our business. At December 31, 2008, we were productively utilizing the majority of the space in our facilities.

The locations by segment of our major manufacturing facilities at December 31, 2008 were as follows:


Air Conditioning Systems and Services
Americas	Europe, Middle East, Africa	Asia Pacific
Parana, Brazil	Charmes, France	Guang Dong, China
Monterrey, Mexico	Golbey, France	Taicang, China
Fort Smith, Arkansas		Taipei, Taiwan
Pueblo, Colorado
Lynn Haven, Florida
Macon, Georgia
Vidalia, Georgia
Lexington, Kentucky
Trenton, New Jersey
Columbia, South Carolina
Clarksville, Tennesse
Tyler, Texas
La Crosse, Wisconsin


Climate Control Technologies
Americas	Europe, Middle East, Africa	Asia Pacific
Londrina, Brazil	Kolin, Czech Republic	Luoyang, China
Monterrey, Mexico	Galway, Ireland	Shenzen, China
Mexico City, Mexico	Barcelona, Spain	Suzhou, China
Arecibo, Puerto Rico	Pamplona, Spain	Tauranga, New Zealand
Chino, California	Peralta, Spain
Louisville, Georgia
Suwanee, Georgia
Minneapolis, Minnesota
Bridgeton, Missouri
Hastings, Nebraska


Industrial Technologies
Americas	Europe, Middle East, Africa	Asia Pacific
Montreal, Canada	Douai, France	Changzhou, China
Augusta, Georgia	Wasquehal, France	Guanbxi, China
Campbellsville, Kentucky	Oberhausen, Germany	Nanjing, China
Madison Heights, Michigan	Fogliano Redipuglia, Italy	Shanghai, China
Rochester Hills, Michigan	Vignate, Italy	Ahmadabad, India
Mocksville, North Carolina	Pavlovo, Russia	New Delhi, India
Athens, Pennsylvania
West Chester, Pennsylvania
Seattle, Washington


Security Technologies
Americas	Europe, Middle East, Africa	Asia Pacific
Ensenada, Mexico	Feuquieres, France	Shanghai, China
Tecate, Mexico	Renchen, Germany	Auckland, New Zealand
Tijuana, Mexico	Monsampolo, Italy
San Jose, California	Duzce, Turkey
Security, Colorado
Princeton, Illinois
Indianapolis, Indiana
Cincinnati, Ohio
Caracas, Venezuela

Item 3. LEGAL PROCEEDINGS

In the normal course of business, we are involved in a variety of lawsuits, claims and legal proceedings, including commercial and contract disputes, employment matters, product liability claims, environmental liabilities and intellectual property disputes. In our opinion, pending legal matters are not expected to have a material adverse effect on the results of operations, financial condition, liquidity or cash flows.

Oil for Food Program and Foreign Corrupt Practices Act (FCPA) matters

As previously reported, on November 10, 2004, the Securities and Exchange Commission (SEC) issued an Order directing that a number of public companies, including the Company, provide information relating to their participation in transactions under the United Nations’ Oil for Food Program. Upon receipt of the Order, the Company undertook a thorough review of its participation in the Oil for Food Program, provided the SEC with information responsive to the Order and provided additional information requested by the SEC. During a March 27, 2007 meeting with the SEC, at which a representative of the Department of Justice (DOJ) was also present, the Company began discussions concerning the resolution of this matter with both the SEC and DOJ. On October 31, 2007, the Company announced it had reached settlements with the SEC and DOJ relating to this matter. Under the terms of the settlements, the Company paid a total of $6.7 million in penalties, interest and disgorgement of profits. The Company has consented to the entry of a civil injunction in the SEC action and has entered into a three-year deferred prosecution agreement (DPA) with the DOJ. Under both settlements, the Company has implemented and will continue to implement improvements to its compliance program that are consistent with its longstanding policy against improper payments. In the settlement documents, the Government noted that the Company thoroughly cooperated with the investigation, that the

Company had conducted its own complete investigation of the conduct at issue, promptly and thoroughly reported its findings to them, and took prompt remedial measures.

In a related matter, on July 10, 2007, representatives of the Italian Guardia di Finanza (Financial Police) requested documents from Ingersoll-Rand Italiana S.p.A pertaining to certain Oil for Food transactions undertaken by that subsidiary of the Company which resulted in charges being filed against that subsidiary. Such transactions had previously been reported to the SEC and DOJ. At a December 12, 2008 hearing, all charges against the subsidiary were dismissed.

Additionally, we have reported to the DOJ and SEC that we are currently investigating certain matters involving Trane, including one relating to the Oil for Food Program, and which raise potential issues under the FCPA and other applicable anti-corruption laws. We have indicated to the SEC and DOJ that we are conducting a thorough investigation of these matters and that we would report back to them with our findings. The investigation of these matters began in earnest promptly after our acquisition of Trane in June 2008 and is currently in progress. Previously, we had reported to the SEC and DOJ potential FCPA issues relating to one of our businesses in China, and we have reported back to them and shared our audit report, which indicated no FCPA violations. These matters (and other matters which may arise or of which we become aware in the future) may be deemed to violate the FCPA and other applicable anti-corruption laws. Such determinations could subject us to, among other things, further enforcement actions by the SEC or the DOJ (if, for example, the DOJ deems us to have violated the DPA), securities litigation and a general loss of investor confidence, any one of which could adversely affect our business prospects and the market value of our stock.

The European Commission Investigation

In November 2004, Trane was contacted by the European Commission as part of a multi-company investigation into possible infringement of European Union competition law relating to the distribution of bathroom fixtures and fittings in certain European countries. On March 28, 2007, Trane, along with a number of other companies, received a Statement of Objections from the European Commission. The Statement of Objections, an administrative complaint, alleges infringements of European Union competition rules by numerous bathroom fixture and fittings companies, including Trane and certain of its European subsidiaries engaged in the Bath and Kitchen business. Certain of these legal entities were transferred to WABCO as part of a legal reorganization in connection with the spinoff of Trane’s Vehicle Control Systems business that occurred on July 31, 2007. Trane and certain of its subsidiaries and, in light of that legal reorganization, certain of WABCO’s subsidiaries will be jointly and severally liable for any fines that result from the investigation. However, pursuant to an Indemnification and Cooperation Agreement among Trane and certain other parties (Indemnification Agreement), American Standard Europe BVBA (renamed WABCO Europe BVBA) (WABCO Europe), which is a subsidiary of WABCO following the reorganization, will be responsible for, and will indemnify Trane and its subsidiaries (including certain subsidiaries formerly engaged in the Bath and Kitchen business) and their respective affiliates against, any fines related to this investigation. Trane and the charged subsidiaries responded to the European Commission on August 1, 2007 and July 31, 2007, respectively. A hearing with the European Commission regarding the response to the Statement of Objections was conducted from November 12-14, 2007, in Brussels. WABCO Europe and other former Trane subsidiaries participated in the hearing. Trane, however, did not participate in the hearing.

to a probable reduction for leniency of at least 20 percent provided WABCO Europe, as the leniency applicant, fulfilled all conditions set forth in the European Commission’s leniency notice. WABCO has stated in its Form 10-K for the fiscal year ended December 31, 2008 that its ability to satisfy its obligations under the Indemnification Agreement is contingent on its funding capability at the time of the fine, which could be affected by, among other things, its ability to access its then existing credit facilities, its ability to obtain alternative sources of financing, its ability to obtain some payment relief from the European Commission or its ability to obtain a suspension of the payment obligation from the European Court of First Instance.

Tax Related Matters

On July 20, 2007, the Company and its consolidated subsidiaries received a notice from the IRS containing proposed adjustments to the Company’s tax filings in connection with an audit of the 2001 and 2002 tax years. The IRS did not contest the validity of the Company’s reincorporation in Bermuda. The most significant adjustments proposed by the IRS involve treating the entire intercompany debt incurred in connection with the Company’s reincorporation in Bermuda as equity. As a result of this recharacterization, the IRS has disallowed the deduction of interest paid on the debt and imposed dividend withholding taxes on the payments denominated as interest. These adjustments proposed by the IRS, if upheld in their entirety, would result in additional taxes with respect to 2002 of approximately $190 million plus interest, and would require the Company to record additional charges associated with this matter. At this time, the IRS has not yet begun their examination of the Company’s tax filings for years subsequent to 2002. However, if these adjustments or a portion of these adjustments proposed by the IRS are ultimately sustained, it is likely to also affect subsequent tax years.

The Company strongly disagrees with the view of the IRS and filed a protest with the IRS in the third quarter of 2007. The Company has and intends to continue to vigorously contest these proposed adjustments. The Company, in consultation with its outside advisors, carefully considered many factors in determining the terms of the intercompany debt, including the obligor’s ability to service the debt and the availability of equivalent financing from unrelated parties, two factors prominently cited by the IRS in denying debt treatment. The Company believes that its characterization of that obligation as debt for tax purposes was supported by the relevant facts and legal authorities at the time of its creation. The subsequent financial results of the relevant companies, including the actual cash flow generated by operations and the production of significant additional cash flow from dispositions have confirmed the ability to service this debt. Although the outcome of this matter cannot be predicted with certainty, based upon an analysis of the strength of its position, the Company believes that it is adequately reserved for this matter. As the Company moves forward to resolve this matter with the IRS, it is reasonably possible that the reserves established may be adjusted within the next 12 months. However, the Company does not expect that the ultimate resolution will have a material adverse impact on its future results of operations or financial position. For a further discussion of tax matters, see Note 19 to the consolidated financial statements.

Asbestos Related Matters

Certain wholly owned subsidiaries of the Company are named as defendants in asbestos-related lawsuits in state and federal courts. In virtually all of the suits, a large number of other companies have also been named as defendants. The vast majority of those claims has been filed against either Ingersoll Rand Company (IR-New Jersey) or Trane and generally allege injury caused by exposure to asbestos contained in certain historical products sold by IR-New Jersey or Trane, primarily pumps, boilers and railroad brake shoes. Neither IR-New Jersey nor Trane was a producer or manufacturer of asbestos, however, some formerly manufactured products utilized asbestos-containing components such as gaskets and packings purchased from third-party suppliers.

See also the discussion under Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, Environmental and Asbestos Matters and also Note 22 to the consolidated financial statements.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of the Company’s security holders during the last quarter of its fiscal year ended December 31, 2008.

Executive Officers of the Registrant

Pursuant to the General Instruction G(3) of Form 10-K, the following list of executive officers of the Company as of February 25, 2008 is included as an unnumbered item in Part I of this report in lieu of being included in the Company's proxy Statement for its 2008 Annual General Meeting of Shareholders.


Name and Age	Date of Service as an Executive Officer	Principal Occupation and Other Information for Past Five Years
Herbert L. Henkel (60)	4/5/1999	Chairman of Board and Chief Executive Officer (since October 1999)

Michael W. Lamach (45)	2/16/2004	President and Chief Operating Officer (since February 2009); Senior Vice President and President, Trane Commercial (2008-2009); Senior Vice President and President, Security Technologies (2004-2008)

Steven R. Shawley (56)	8/1/2005	Senior Vice President and Chief Financial Officer (since June 2008); Senior Vice President and President, Climate Control Technologies (2005-2008); President Climate Control Americas (2003-2005)

Marcia J. Avedon (47)	2/7/2007	Senior Vice President, Human Resources and Communication (since February 2007); Merck & Co., Inc., Senior Vice President, Human Resources (2003-2006)

James R. Bolch (51)	10/16/2005	Senior Vice President and President, Industrial Technologies Sector (since October 2005); Schindler Elevator Corporation, Executive Vice President, Service Business (2004-2005)

William B. Gauld (55)	10/2/2006	Senior Vice President, Enterprise Services (since October 2006); Principal, The W Group (2005-2006); Pearson, plc, Chief Information Officer (2001-2005)

Steven B. Hochhauser (47)	6/16/2008	President, Security Technologies (since June 2008); Johns Manville, Chairman, President and Chief Executive Officer (2004-2007) and Chief Operating Officer (2002-2004)

Patricia Nachtigal (62)	11/2/1988	Director (since January 1, 2002); Senior Vice President and General Counsel (since November 1988)

David R. Pannier (58)	6/5/2008	President, Trane Residential (since June 2008); Trane Inc., President, Trane Residential (2002-2008)

Didier Teirlinck (52)	6/4/2008	President, Climate Control Technologies (since June 2008); President, Climate Control Europe (2005-2008); President, Volvo Equipment (2000-2005)

Richard J. Weller (52)	9/8/2008	Vice President and Controller (since September 2008); Vice President, Finance (June-September 2008); Vice President, Finance, Security Technologies Sector (2005-2008); Textron Inc., Vice President, Finance, Shared Services (2002-2005)

No family relationship exists between any of the above-listed executive officers of the Company. All officers are elected to hold office for one year or until their successors are elected and qualified.

PART II


Item 5.		MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Information regarding the principal market for our common shares and related shareholder matters is as follows:

Our Class A common shares are traded on the New York Stock Exchange under the symbol IR. As of February 20, 2009, the approximate number of record holders of Class A common shares was 7,102. The high and low sales price per share and the dividend paid per share for the following periods were as follows:


		Common shares
2008		High		Low		Dividend
First quarter	$	46.57	$	34.46	$	0.18
Second quarter		46.84		36.54		0.18
Third quarter		41.14		29.18		0.18
Fourth quarter		30.60		11.75		0.18

2007
First quarter	$	45.62	$	38.25	$	0.18
Second quarter		56.63		43.39		0.18
Third quarter		56.66		44.52		0.18
Fourth quarter		55.94		42.94		0.18

The Bank of New York Mellon (BNY Mellon Shareowner Services, P.O. Box 358015, New York, NY 15252-8015, (800) 507-9357) is our transfer agent, registrar and dividend reinvestment agent.

Future dividends on our Class A common shares, if any, will be at the discretion of our Board of Directors and will depend on, among other things, our results of operations, cash requirements and surplus, financial condition, contractual restrictions and other factors that the Board of Directors may deem relevant, as well as our ability to pay dividends in compliance with the Bermuda Companies Act. This Act regulates the payment of dividends and the making of distributions from contributed surplus. We may not declare or pay a dividend, or make a distribution out of contributed surplus, if there are reasonable grounds for believing that: (i) we are, or would be after the payment, unable to pay our liabilities as they become due; or (ii) the realizable value of our assets would thereby be less than the aggregate of our liabilities and issued share capital and share premium accounts.

Information regarding equity compensation plans required to be disclosed pursuant to this Item is incorporated by reference from our definite Proxy Statement for the Annual General Meeting of Shareholders.

Shares of IR-Limited owned by a subsidiary are treated as treasury stock and are recorded at cost on the balance sheet. During 2008, we issued 45.4 million IR-Limited Class A common shares to fund the equity portion of the consideration paid for the Trane acquisition. During 2007, we repurchased 39.7 million Class A common shares at a cost $1,999.9 million under our existing $4 billion share repurchase program. During 2006, we completed our prior $2 billion share repurchase program by repurchasing 27.7 million Class A common shares at a cost of $1,096.3 million.

Total share repurchases for the year ended December 31, 2008 are as follows:


Period	Total number of shares purchased (000’s)	Average price paid per share	Total number of shares purchased as part of the publicly announced program (000’s)		Approximate dollar value of shares still available to be purchased under the program ($000’s)
01/01/2008 - 03/31/2008	-	-	-	$	2,000,100
04/01/2008 - 06/30/2008	45.2	43.83	45.2		1,998,120
07/01/2008 - 09/30/2008	-	-	-		1,998,120
10/01/2008 - 12/31/2008	-	-	-		1,998,120
Total	45.2		45.2

Performance Graph

The following graph compares the cumulative total shareholder return on our Class A common shares with the cumulative total return on (i) the Standard & Poor’s 500 Stock Index, (ii) the Standard & Poor’s 500 Industrial Machinery Index, and (iii) the Standard & Poor’s 500 Industrial Index for the five years ended December 31, 2008. The graph assumes an investment of $100 in our Class A common shares, the Standard & Poor’s 500 Stock Index, the Standard & Poor’s 500 Industrial Machinery Index, and the Standard & Poor’s 500 Industrial Index on December 31, 2003 and assumes the reinvestment of dividends.

We are including a new index, the Standard & Poor’s 500 Industrial Index, in the graph this year because we have significantly changed our business portfolio over the past three years. During this period, we have divested heavy machinery and construction-related businesses, which focused on original equipment revenues and were more affected by cyclical market behavior. With the acquisition of Trane, our businesses are more focused on replacement and recurring revenue markets. Consequently, while we are a member of both the Standard & Poor’s 500 Industrial Machinery Index and the Standard & Poor’s 500 Industrial Index, we believe that a comparison of our performance to the Standard & Poor’s 500 Industrial Index is a more appropriate measure.

LOGO

Item 6. SELECTED FINANCIAL DATA

In millions, except per share amounts:


At and for the years ended December 31,	2008			2007		2006		2005		2004

Net revenues	$	13,227.4		$	8,763.1	$	8,033.7	$	7,263.7	$	6,663.2

Earnings (loss) from continuing operations		(2,567.4	)		733.1		765.0		731.8		554.2

Earnings (loss) from discontinued operations		(57.4	)		3,233.6		267.5		322.4		664.5

Total assets		20,924.5			14,376.2		12,145.9		11,756.4		11,414.6

Total debt		5,124.1			1,453.7		1,984.6		2,117.0		1,880.4

Shareholders’ equity		6,661.4			7,907.9		5,404.8		5,761.9		5,733.8

Basic earnings (loss) per common share:
Continuing operations	$	(8.54	)	$	2.52	$	2.39	$	2.17	$	1.60
Discontinued operations		(0.19	)		11.12		0.84		0.95		1.92

Diluted earnings (loss) per common share:
Continuing operations	$	(8.54	)	$	2.48	$	2.37	$	2.14	$	1.58
Discontinued operations		(0.19	)		10.95		0.83		0.95		1.89

Dividends per common share	$	0.72		$	0.72	$	0.68	$	0.57	$	0.44

1.	Earnings and dividends per common share amounts have been restated to reflect a two-for-one stock split that occurred in August 2005.

2.	2006 – 2004 amounts have been restated to reflect Compact Equipment and the Road Development business unit as discontinued operations.

3.	2008 amounts include the results of Trane since the acquisition date (June 5, 2008 through December 31, 2008).

4.	2008 Earnings (loss) from continuing operations include an after-tax, non-cash asset impairment charge of $3.4 billion that was recognized in the fourth quarter.


Item 7.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause a difference include, but are not limited to, those discussed under Item 1A. Risk Factors in this Annual Report on Form 10-K. The following section is qualified in its entirety by the more detailed information, including our financial statements and the notes thereto, which appears elsewhere in this Annual Report.

Overview

Organization

We are dedicated to inspiring progress for our customers, shareholders, employees and communities by achieving:

•

Dramatic Growth , by focusing on innovative solutions for our customers;

•

Operational Excellence , by pursuing continuous improvement in all of our operations; and

•

Dual Citizenship , by bringing together the talents of all Ingersoll Rand people to leverage the capabilities of our global enterprise.

Trends and Economic Events

We are a global corporation with worldwide operations. As a global business, our operations are affected by worldwide, regional and industry-specific economic factors, as well as political factors, wherever we operate or do business. Our geographic and industry diversity, as well as the diversity of our product sales and services, has helped limit the impact of any one industry or the economy of any single country on our consolidated operating results.

The recent extreme volatility and disruption of financial markets in the United States, Europe and Asia have contributed to weakening worldwide economic conditions. As a result, we have seen weaker

demand for many of our products and services during the second half of 2008. In addition, the uncertainty related to the cost and availability of credit has further depressed the overall business climate. Our revenues from continuing operations for 2008 increased 50.9% compared with 2007, primarily associated with the acquisition of Trane Inc. (Trane). Excluding the results of Trane, our revenues from continuing operations for 2008 increased less than 1% compared with 2007.

Despite the increasingly challenging economic environment, we continue to execute our business strategy. The divestiture of both Compact Equipment and the Road Development business unit in 2007, in addition to the acquisition of Trane in 2008, has enabled us to become more balanced across the products we offer. In addition, our current enterprise-wide restructuring actions initiated in the fourth quarter of 2008 are designed to streamline the footprint of our manufacturing facilities and reduce our general and administrative cost base.

Given the broad range of products manufactured and geographic markets served, management uses a variety of factors to predict the outlook for the Company. We monitor key competitors and customers in order to gauge relative performance and the outlook for the future. In addition, our order rates are indicative of future revenue and thus a key measure of anticipated performance. In those industry segments where we are a capital equipment provider, revenues depend on the capital expenditure budgets and spending patterns of our customers, who may delay or accelerate purchases in reaction to changes in their businesses and in the economy.

For 2009, we expect current market conditions continuing to negatively affect our financial results. Declining markets in North America and Western Europe partially offset by slight to moderate growth in the developing economies of Eastern Europe, Asia and Latin America will have a negative impact. In addition, with more than 40% of our revenues generated outside of the U.S., the recent appreciation of the U.S. dollar against most major currencies could negatively impact our 2009 revenue.

Despite the current economic turmoil, we have a solid foundation of global brands and leading market shares in all of our major product lines. In addition, our growing geographic and industry diversity coupled with our large installed product base provides growth opportunities within our service, parts and replacement revenue streams.

Acquisition of Trane

At the close of business on June 5, 2008 (the Acquisition Date), we completed the acquisition of 100% of the outstanding common shares of Trane. Trane, previously named American Standard Companies Inc., provides systems and services that enhance the quality and comfort of the air in homes and buildings around the world. Trane’s systems and services have leading positions in premium commercial, residential, institutional and industrial markets, a reputation for reliability, high quality and product innovation and a powerful distribution network. Trane’s 2007 annual revenues were $7.5 billion.

We paid a combination of (i) 0.23 of an IR-Limited Class A common share and (ii) $36.50 in cash, without interest, for each outstanding share of Trane common stock. The total cost of the acquisition was approximately $9.6 billion, including change in control payments and direct costs of the transaction. We financed the cash portion of the acquisition with a combination of cash on hand, commercial paper and a 364-day senior unsecured bridge loan facility.

The components of the purchase price were as follows:


In billions
Cash consideration	$	7.3
Stock consideration (Issuance of 45.4 million IR-Limited Class A common shares)		2.0
Estimated fair value of Trane stock options converted to 7.4 million IR-Limited stock options		0.2
Transaction costs		0.1
Total	$	9.6

As a result of the acquisition, the results of the operations of Trane have been included in the statement of financial position at December 31, 2008 and the consolidated statements of operations and cash flows since the Acquisition Date. For further details on the acquisition of Trane, see Note 3 to the consolidated financial statements.

Significant events in 2008

As discussed in Acquisition of Trane above, on June 5, 2008, we acquired 100% of the outstanding common shares of Trane for approximately $9.6 billion.

In August 2008, we filed a universal shelf registration statement with the Securities and Exchange Commission (SEC) for an indeterminate amount of securities for future issuance and issued $1.6 billion of long-term debt pursuant to the shelf registration statement. This issuance consisted of $250 million Senior Floating Rate Notes due in 2010, $600 million 6.000% Senior Notes due in 2013 and $750 million 6.875% Senior Notes due in 2018. These notes are fully and unconditionally guaranteed by IR-Limited, which directly owns 100% of the subsidiary issuer, IR Global Holding Company Limited. The net proceeds from the offering were used to partially reduce the amount outstanding under the senior unsecured bridge loan facility, which had a balance of $754 million at December 31, 2008.

In October 2008, we announced plans to initiate enterprise-wide restructuring actions. These actions include streamlining the footprint of manufacturing facilities and reducing the general and administrative cost base. Projected costs will approximate $110 million. As of December 31, 2008, we have incurred $71 million of costs associated with this restructuring.

In the fourth quarter of 2008, we tested goodwill and other indefinite-lived intangible assets for impairment. As a result of decreased global equity valuations, the tightening of industrial and retail end markets and a resulting decline in our 2009 projected financial performance, we incurred a non-cash pre-tax impairment charge of $3,710.0 million, $3,385.0 million after-tax.

Significant events in 2007

On November 30, 2007, we completed the sale of our Bobcat, Utility Equipment and Attachments business units (collectively, Compact Equipment) to Doosan Infracore for cash proceeds of approximately $4.9 billion, subject to post-closing purchase price adjustments. Compact Equipment manufactured and sold compact equipment including skid-steer loaders, compact track loaders, mini-excavators and telescopic tool handlers; portable air compressors, generators, light towers; general-purpose light construction equipment; and attachments. We are currently in the process of resolving the final purchase price adjustments with Doosan Infracore.

During the fourth quarter of 2007, we recorded a non-cash charge to earnings of discontinued operations of $449 million ($277 million after-tax) relating to the company's liability for all pending and estimated future asbestos claims through 2053. This charge resulted from an increase in our recorded liability for asbestos claims by $538 million, from $217 million to $755 million, offset by a corresponding $89 million increase in our recorded asset for probable asbestos-related insurance recoveries, from $161 million to $250 million at December 31, 2007. For a further discussion of asbestos matters, see Note 22 to the consolidated financial statements.

On July 20, 2007, the Company and its consolidated subsidiaries received a notice from the Internal Revenue Service (IRS) containing proposed adjustments to the Company’s tax filings in connection with an audit of the 2001 and 2002 tax years. The IRS did not contest the validity of the Company’s reincorporation in Bermuda. The most significant adjustments proposed by the IRS involve treating the entire intercompany debt incurred in connection with the Company’s reincorporation in Bermuda as equity. As a result of this recharacterization, the IRS has disallowed the deduction of interest paid on the debt and imposed dividend withholding taxes on the payments denominated as interest. These adjustments proposed by the IRS, if upheld in their entirety, would result in additional taxes with respect to 2002 of approximately $190 million plus interest, and would require the Company to record additional charges associated with this matter. At this time, the IRS has not yet begun their examination of the Company’s tax filings for years subsequent to 2002. However, if these adjustments or a portion of these adjustments proposed by the IRS are ultimately sustained, it is likely to also affect subsequent tax years.

The Company strongly disagrees with the view of the IRS and filed a protest with the IRS in the third quarter of 2007. The Company has and intends to continue to vigorously contest these proposed adjustments. The Company, in consultation with its outside advisors, carefully considered many factors in determining the terms of the intercompany debt, including the obligor’s ability to service the debt and the availability of equivalent financing from unrelated parties, two factors prominently cited by the IRS in denying debt treatment. The Company believes that its characterization of that obligation as debt for tax purposes was supported by the relevant facts and legal authorities at the time of its creation. The subsequent financial results of the relevant companies, including the actual cash flow generated by operations and the production of significant additional cash flow from dispositions have confirmed the ability to service this debt. Although the outcome of this matter cannot be predicted with certainty, based upon an analysis of the strength of its position, the Company believes that it is adequately reserved for this matter. As the Company moves forward to resolve this matter with the IRS, it is reasonably possible that the reserves established may be adjusted within the next 12 months. However, the Company does not expect that the ultimate resolution will have a material adverse impact on its future results of operations or financial position. See Note 19 to the consolidated financial statements for a further discussion of tax matters.

During 2007, we repurchased 39.7 million Class A common shares at a cost $1,999.9 million under our existing $4 billion share repurchase program. This repurchase program was originally authorized by the Board of Directors in December 2006 to repurchase up to $2 billion and subsequently expanded to $4 billion in May 2007.

Significant Events in 2006

During 2006, we completed our original $2 billion share repurchase program by repurchasing 27.7 million Class A common shares at a cost of $1,096.3 million. This share repurchase program was originally authorized by the Board of Directors in August 2004 and subsequently expanded in August 2005. In December 2006, the Board of Directors authorized a new share repurchase program to repurchase up to $2 billion worth of Class A common shares. No amounts were repurchased under the December 2006 authorization as of December 31, 2006.

On October 6, 2006, we received a notice from the IRS containing proposed adjustments to our tax filings in connection with an audit of the 1998 through 2000 tax years. The principal proposed adjustments consist of the disallowance of certain capital losses taken in our tax returns in 1999 and 2000. The disallowance would result in additional taxes and penalties of approximately $155 million, plus interest through October 6, 2006, of approximately $62 million. As a result, in the third quarter of 2006, we added approximately $27 million ($0.08 per dilutive share) to previously established reserves. In order to reduce the potential interest expense associated with this matter, we made a payment to the IRS of $217 million in the third quarter of 2007. See Note 19 to the consolidated financial statements for a further discussion of tax matters.

Results of Operations


Dollar amounts in millions, except per share data		2008		% of Revenues		2007		% of Revenues		2006		% of Revenues
Net revenues	$	13,227.4			$	8,763.1			$	8,033.7
Cost of goods sold		(9,748.1	)	73.7%		(6,272.0	)	71.6%		(5,768.4	)	71.8%
Selling and administrative expenses		(2,343.1	)	17.7%		(1,433.3	)	16.3%		(1,266.8	)	15.8%
Asset impairment		(3,710.0	)			-				-
Operating income (loss)		(2,573.8	)	-19.5%		1,057.8		12.1%		998.5		12.4%
Interest expense		(245.4	)			(136.2	)			(133.6	)
Other, net		43.2				15.9				(7.3	)
Earnings (loss) before income taxes		(2,776.0	)			937.5				857.6
(Provision) benefit for income taxes		208.6				(204.4	)			(92.6	)
Earnings (loss) from continuing operations		(2,567.4	)			733.1				765.0
Discontinued operations, net of tax		(57.4	)			3,233.6				267.5
Net earnings (loss)	$	(2,624.8	)		$	3,966.7			$	1,032.5

Diluted earnings (loss) per common share:
Continuing operations	$	(8.54	)		$	2.48			$	2.37
Discontinued operations		(0.19	)			10.95				0.83
Net earnings (loss)	$	(8.73	)		$	13.43			$	3.20

The discussions that follow describe the significant factors contributing to the changes in our results of operations for the periods presented. Included in the review are certain non-GAAP financial measures. We believe that it is meaningful to provide the relative impact of integration and restructuring charges, non-recurring cost related to the acquisition of Trane and impairment charges in order to present a better understanding of our results on a period to period comparative basis. The adjusted information is intended to be more indicative of our core operating results.

Net Revenues

Net revenues for the year ended December 31, 2008 increased by 51%, or $4,464.3 million, compared with the same period of 2007, which primarily resulted from the following:


Volume/product mix	-4.5	%
Pricing	2.5	%
Currency exchange rates	2.0	%
Acquisitions	51.0	%
Total	51.0	%

The acquisition of Trane on June 5, 2008 increased revenues by $4,401.3 million during the year. Excluding the results of Trane, revenues increased by 0.7%, or $63.0 million. Softening overall demand in many major end-markets was the primary driver of the volume reduction. However, we continue to make progress in increasing recurring revenues, which improved by 6% over prior year and accounted for 19% of net revenues in 2008.

Net revenues for the year ended December 31, 2007 increased by 9%, or $729.4 million, compared with the same period of 2006, which primarily resulted from the following:


Volume/product mix	4.0	%
Pricing	2.0	%
Acquisitions	2.5	%
Currency exchange rates	0.5	%
Total	9.0	%

Revenues increased significantly in the European, Asian and Latin American regions as volumes, product mix and pricing all improved during 2007. North American revenues increased moderately compared to 2006. These increases occurred in each of our business segments. Recurring revenues continue to be a source of growth as they improved by 9% over the prior year and accounted for 18% of net revenues in 2007.

Cost of Goods Sold

For the year ended December 31, 2008, cost of goods sold increased by $3,476.1 million compared to the same period in 2007. The increase was primarily related to the acquisition of Trane. In addition, cost of goods sold included $56.7 million of restructuring and integration costs compared to restructuring costs of $24.8 million in 2007. Cost of goods sold as a percentage of revenue increased to 73.7% compared with 71.6% for the same period of 2007. Excluding the results of Trane, cost of goods sold as a percentage of revenue would have been 72.7%. Higher material costs and unfavorable business and product mix more than offset price increases. In addition, decreased leverage due to lower volumes contributed to the year-over-year increase.

For the year ended December 31, 2007, cost of goods sold as a percentage of revenues decreased slightly to 71.6% compared with 71.8% for the same period of 2006. Increased leverage on higher revenues provided a benefit which was offset by unfavorable mix and higher material costs. Restructuring costs, which accounted for $24.8 million of the year-over-year increase, had a 0.3% impact on cost of goods sold as a percentage of revenue.

Selling and Administrative Expenses

For the year ended December 31, 2008, selling and administrative expense increased by $909.8 million compared to the same period in 2007. The increase was primarily related to the acquisition of Trane. In addition, selling and administrative expense included $34.2 million of restructuring and integration costs compared to $3.9 million of restructuring costs in 2006. Selling and administrative expense as a percentage of revenue increased to 17.7% compared with 16.3% for the same period of 2007. Excluding the results of Trane, selling and administrative expense as a percentage of revenue would have been 16.6%. Decreased leverage due to lower volumes more than offset expense reduction and price increases.

For the year ended December 31, 2007, selling and administrative expenses as a percentage of revenues increased to 16.3% compared with 15.8% for the same period of 2006. This increase was primarily due to increased costs of $23 million associated with the divestiture of Compact Equipment and the Road

Development business unit. In addition, share-based compensation expense of $20 million and the prior year adjustment of the allowance for doubtful accounts of $15 million also contributed to the increase. These additional costs were partially offset by better leverage from higher revenue.

Asset Impairment

During the fourth quarter of 2008, we tested goodwill and other indefinite-lived intangible assets for impairment. As a result of decreased global equity valuations, the tightening of industrial and retail end markets and a resulting decline in our 2009 projected financial performance, we incurred a non-cash pre-tax impairment charge of $3,710.0 million, $3,385.0 million after-tax.

The following table summarizes the impairment charges that were taken by sector during 2008:


In millions		Goodwill		Intangible Assets		Marketable Securities		Total
Air Conditioning Systems and Services	$	2,496.0	$	814.0	$	-	$	3,310.0
Climate Control Technologies		-		40.0		-		40.0
Security Technologies		344.0		6.0		10.0		360.0
Total	$	2,840.0	$	860.0	$	10.0	$	3,710.0

For a further discussion of impairment related matters, see Goodwill and Indefinite-Lived Intangible Assets under Critical Accounting Policies and Note 4 to the consolidated financial statements.

Operating Income (Loss)

Operating income for the year ended December 31, 2008 decreased by $3,631.6 million compared with the same period of 2007. The primary driver of the year-over-year decrease related to the $3,710.0 million asset impairment charge recognized in the fourth quarter of 2008. Results were further impacted by the acquisition of Trane in the second quarter of 2008 in addition to related restructuring and integration cost. Excluding these items, operating margins would have been 7.8%. Lower volumes, higher commodity costs and an unfavorable business and product mix were partially offset by expense reduction, productivity actions and improved pricing.

Operating income for the year ended December 31, 2007 increased by $59.3 million or 5.9%, compared with the same period of 2006. Excluding restructuring charges, operating income would have increased by 8.8% to $1,086.5 million. The increase in operating income was mainly attributable to increased revenues, productivity improvements, improved pricing and favorable volumes. These benefits were partially offset by higher material costs and an unfavorable product mix. However, these cost increases, coupled with the unfavorable product mix, held operating margins flat at 12.4% compared to the prior year.

Interest Expense

Interest expense for the year ended December 31, 2008 increased $109.2 million compared with the same period of 2007. The increase is primarily related to significantly higher debt levels used to help fund the acquisition of Trane in June 2008.

Interest expense for the year ended December 31, 2007 increased by $2.6 million compared with the same period of 2006. The increase was mainly attributable to higher year-over-year average debt levels due to the issuance and subsequent repayment of commercial paper during the year.

Other, Net

The year-over-year changes in Other, net primarily resulted from the following:


In millions		2008			2007			2006
Interest income	$	95.6		$	36.2		$	15.9
Exchange gain (loss)		(41.9	)		(2.8	)		(21.3	)
Minority interests		(20.0	)		(14.3	)		(14.9	)
Earnings from equity investments		3.4			1.0			(0.1	)
Other		6.1			(4.2	)		13.1
Other, net	$	43.2		$	15.9		$	(7.3	)

For the year ended December 31, 2008, Other, net increased by $27.3 million compared with the same period of 2007. The increase was a result of greater interest income generated by higher average cash balances prior to the acquisition of Trane in June 2008. The results were partially offset by currency losses due to significant volatility in currency exchange rates, predominately in the fourth quarter.

For the year ended December 31, 2007, Other, net increased by $23.2 million compared to the same period of 2006. The increase was primarily due to increased interest income as result of higher average cash balances during 2007. Additionally, Other, net in 2006 included income from a reduction of a product liability reserve of approximately $9 million.

Provision for Income Taxes

For the year ended December 31, 2008, the effective tax rate was 7.5%. The tax rate was substantially below the U.S. Statutory rate of 35.0% primarily due to the large impairment charge recognized in the fourth quarter, as well as earnings in non-U.S. jurisdictions, which, in aggregate, have a lower effective rate. Excluding the impairment charge, the adjusted effective rate would have been 12.4%, compared with an effective rate of 21.8% in 2007. The 9.4 point reduction in the effective rate is primarily the result of lower earnings in high tax jurisdiction during 2008.

The effective tax rate increased approximately by 11% in 2007 compared with 2006. The increase in the effective tax rate during 2007 was primarily due to increased earnings in higher tax jurisdictions (7.2%) and increased tax reserves (3.2%) primarily associated with Financial Accounting Standard Board Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement 109” (FIN 48), a new accounting standard that we adopted in 2007. FIN 48 prescribes a recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return.

Review of Business Segments

We classify our business into four reportable segments based on industry and market focus: Air Conditioning Systems and Services, Climate Control Technologies, Industrial Technologies and Security Technologies. The segment discussions that follow describe the significant factors contributing to the changes in results for each segment included in continuing operations.

Included in the review of our business segments are non-GAAP financial measures. We believe that it is meaningful to provide the relative impact of integration and restructuring charges, non-recurring cost related to the acquisition of Trane and impairment charges in order to present a better understanding of our results on a period to period comparative basis. The adjusted information is intended to be more indicative of our core operating results.

Air Conditioning Systems and Services


Dollar amounts in millions		2008
Net revenues	$	4,401.3

Operating income (loss)		(3,145.7	)
Add back:
Impairment charges		3,310.0
Purchase accounting charges		158.4
Restructuring charges		15.3
Integration charges		5.0
Adjusted operating income	$	343.0

Operating margin		-71.5%
Adjusted operating margin		7.8%
Includes results since the acquisition date (June 5, 2008)

Reported results for revenues and operating income for the six months and 25 days ended December 31, 2008 reflect year-to-date activity since the Acquisition Date (June 5, 2008 onward). In the fourth quarter of 2008, we recognized a non-cash charge of $3,310.0 million related to the impairment of goodwill and indefinite-lived intangible assets within the segment.

Included within operating income is $158.4 million of purchase accounting charges that are not expected to recur next year. These charges relate to inventory step-up, backlog amortization and in-process research and development costs. In addition, we recorded $20.3 million of severance and other business integration costs associated with the acquisition. Excluding these charges, operating income would have been $343.0 million with an adjusted operating margin of 7.8%.

Included in adjusted operating income is $81.1 million of costs associated with the amortization of intangible assets fair valued as of the Acquisition Date. We expect these costs to be an incremental expense in future periods as they relate to intangible assets with finite lives.

Commercial results decreased in both domestic and international markets. Increased revenues for parts, services and solutions were more than offset by a decline in equipment revenues. Residential results were impacted by continued weakness in the U.S. housing market.

Climate Control Technologies

Our Climate Control Technologies segment provides equipment and services to manage controlled-temperature environments for food and other perishables throughout the world. Encompassing the transport and stationary refrigeration markets, this segment offers customers a broad range of products and solutions such as refrigerated display merchandisers, beverage coolers, auxiliary power units, walk-in storage coolers and freezers and transport temperature control units. This segment includes the market leading brands of Hussmann and Thermo King.


Dollar amounts in millions		2008	% change		2007	% change		2006
Net revenues	$	3,356.8	-0.5%	$	3,372.4	6.4%	$	3,171.0

Operating income		278.9	-27.1%		382.6	7.5%		356.0
Add back:
Impairment charges		40.0			-			-
Restructuring charges		38.6			22.4			-
Adjusted operating income	$	357.5	-11.7%	$	405.0	13.8%	$	356.0

Operating margin		8.3%			11.3%			11.2%
Adjusted operating margin		10.7%			12.0%			11.2%

2008 vs 2007

For the year ended December 31, 2008, net revenues decreased by 0.5% or $15.6 million, compared with the same period of 2007. The slight decrease in the year-over-year results were primarily due to lower volumes (4%) offset by a favorable currency impact (3%) and improved pricing.

Operating income decreased by 27.1% or $103.7 million during 2008. In the fourth quarter, we recognized a non-cash charge of $40.0 million related to the impairment of indefinite-lived intangible assets within the segment. In addition, we recorded $38.6 million of restructuring charges associated with employee termination benefits and other cost associated with announced restructuring plans. Excluding the impairment charge and restructuring costs, operating income would have been $357.5 million, increasing the operating margin to 10.7% from 8.3%.

On an adjusted basis, operating income for the year ended December 31, 2008 decreased by 11.7% or $47.5 million compared with the same period of 2007. The decrease was primarily related to lower volumes and product mix ($73 million), increased material costs ($46 million) partially offset by increased productivity ($51 million), improved pricing ($44 million) and a favorable currency impact.

The decrease in segment revenues primarily resulted from the decline in the truck market, which decreased refrigerated trailer and truck revenues in North America and Europe. In addition, sea-going container revenues, as well as bus and aftermarket revenues also decreased as a result of slower end market activity. Worldwide display cases and contracting revenue decreased due to declines in display case sales to regional supermarkets in the U.S. and a sharp decline in the installation business. However, sales of the TriPac ^® auxiliary unit continued to experience substantial growth.

2007 vs 2006

For the year ended December 31, 2007, net revenues increased by 6.4% or $201.4 million, compared with the same period of 2006. The main drivers of the increase were a favorable currency impact (4%), higher volumes (2%) and improved product pricing.

Operating income increased by 7.5% or $26.6 million during 2007. During the year, we recorded $22.4 million of restructuring charges relating to ongoing cost reduction efforts, including workforce reductions and the consolidation of manufacturing facilities. Excluding these costs, operating income would have been $405.0 million, increasing the operating margin to 12.0% from 11.3%.

On an adjusted basis, operating income for the year ended December 31, 2007 increased by 13.8% or $49.0 million compared with the same period of 2006. The increase was due to increased productivity ($68 million), improved product pricing ($44 million) and favorable currency impact ($15 million). These increases were partially offset by higher material costs ($46 million), unfavorable product mix ($20 million) and new product development ($8 million).

Net revenues grew in the European, Asian and Latin American regions during the year ended 2007, benefiting from strong truck and trailer sales and year-over-year gains in bus and marine containers. These gains were partially offset by lower activity levels in the North American trailer markets. Revenues for service and installation increased with growth in the North American and Asian markets, offsetting weakness in the European market for display cases.

Industrial Technologies

Our Industrial Technologies segment provides products, services and solutions that enhance energy efficiency, productivity and operations. It offers our global customers a diverse and innovative range of products including compressed air systems, tools, pumps, fluid handling systems, golf and utility vehicles in addition to environmentally friendly micro turbines. This segment includes the Club Car and Ingersoll Rand market leading brands.


Dollar amounts in millions		2008	% change		2007	% change		2006
Net revenues	$	2,938.3	2.1%	$	2,877.1	11.6%	$	2,577.7

Operating income		353.7	-9.8%		392.0	11.4%		351.8
Add back:
Restructuring charges		9.6			1.0			-
Adjusted operating income	$	363.3	-7.6%	$	393.0	11.7%	$	351.8

Operating margin		12.0%			13.6%			13.6%
Adjusted operating margin		12.4%			13.7%			13.6%

2008 vs 2007

For the year ended December 31, 2008, net revenues increased by 2.1% or $61.2 million, compared with the same period of 2007. The primary drivers of the year-over-year increase were improved pricing (2%), acquisitions (2%) and a favorable currency impact (1%). The improved results were partially offset by lower volumes and product mix (3%).

Operating income decreased by 9.8% or $38.3 million during 2008. In the fourth quarter, we recorded $9.6 million of restructuring charges associated with employee termination benefits and other cost associated with announced restructuring plans. Excluding the restructuring costs, operating income would have been $363.3 million, increasing the operating margin to 12.4% from 12.0%.

On an adjusted basis, operating income for the year ended December 31, 2008 decreased by 7.6% or $29.7 million compared with the same period of 2007. The decreased was primarily related to higher material costs ($61 million), lower volumes and product mix ($42 million) and increased spending on new product development ($15 million). These reductions were partially offset by improved pricing ($62 million) and increased productivity ($46 million).

The increase in segment revenue was driven by the worldwide increase in the Air and Productivity Solutions business. However, lower volumes in all geographic areas in the second half of the year show the weakening industrial and fluid handling end markets. In addition, slower industrial production levels as well as the deferral of some maintenance by customers more than offset aftermarket growth. Club Car revenues declined in all geographic areas compared with 2007 mainly due to weak economic fundamentals in key golf, hospitality and recreation markets. However, the business continued to gain market share in the declining golf market and a softening utility vehicle market.

2007 vs 2006

For the year ended December 31, 2007, net revenues increased by 11.6% or $299.4 million, compared with the same period of 2006. Higher volumes and product mix (5%), a favorable currency impact (2%), acquisitions (2%) and improved product pricing (2%) were the primary drivers of the year-over-year increase.

Operating income increased by 11.4% or $40.2 million during 2007. During the year, we recorded $1.0 million of restructuring charges relating to ongoing cost reduction efforts, including workforce reductions and the consolidation of manufacturing facilities. Excluding these costs, operating income would have been $393.0 million, increasing the operating margin to 13.7% from 13.6%.

On an adjusted basis, operating income for the year ended December 31, 2007 increased by 11.7% or $41.2 million compared with the same period of 2006. The increase was due to improved product pricing ($48 million), increased productivity ($33 million) and higher volumes ($32 million). These gains were partially offset by higher material costs ($63 million) and investments in new product development and productivity programs ($13 million).

Air Solutions revenues increased by 16% compared with 2006, mainly driven by favorable worldwide industrial markets and increased recurring revenues. Productivity Solutions revenues increased moderately compared with 2006, mainly due to non-U.S. growth in the industrial fluid and handling markets and higher service revenues, partially offset by a weak domestic market for tools. Club Car revenues increased by 10% compared with 2006, mainly due to growth in the sales of utility, off-road and aftermarket vehicles and ongoing market share gains in a soft golf market.

Security Technologies

Our Security Technologies segment is a leading global provider of products and services that make environments safe, secure and productive. The segment’s market-leading solutions include electronic and biometric access control systems and software, locks and locksets, door closers, exit devices, steel doors and frames, portable security devices, decorative hardware, cabinet hardware as well as time, attendance and personnel scheduling systems. These products serve a wide range of markets including the commercial construction and residential housing market, healthcare, retail, maritime and transport industries as well as educational and governmental facilities. This segment includes the CISA, LCN, Schlage and Von Duprin brands.


Dollar amounts in millions		2008	% change		2007	% change		2006
Net revenues	$	2,531.0	0.7%	$	2,513.6	10.0%	$	2,285.0

Operating income		100.4	-76.8%		433.5	8.3%		400.2
Add back:
Impairment charges		360.0			-			-
Restructuring charges		13.1			5.3			-
Adjusted operating income	$	473.5	7.9%	$	438.8	9.6%	$	400.2

Operating margin		4.0%			17.2%			17.5%
Adjusted operating margin		18.7%			17.5%			17.5%

2008 vs 2007

For the year ended December 31, 2008, net revenues increased by 0.7% or $17.4 million, compared with the same period of 2007. The slight year-over-year increase was primarily related to improved pricing (5%) and a favorable currency impact (1%). However, lower volumes offset most of the revenue gains made during the year.

Operating income decreased by 76.8% or $333.1 million during 2008. In the fourth quarter, we recognized a non-cash charge of $360.0 million related to the impairment of goodwill, indefinite-lived intangible assets and marketable securities within the segment. In addition, we recorded $13.1 million of restructuring charges associated with employee termination benefits and other costs associated with announced restructuring plans. Excluding the impairment charge and restructuring costs, operating income would have been $473.5 million, increasing the operating margin to 18.7% from 4.0%.

On an adjusted basis, operating income for the year ended December 31, 2008 increased by 7.9% or $34.7 million compared with the same period of 2007. Improved pricing ($119 million) and productivity gains ($42 million) more than offset the decrease in volume ($76 million), increased material costs ($15 million) and a negative currency impact ($7 million).

Net revenues increased slightly during the year driven by electronic solutions growth in Asia. However, declines in the North American commercial construction market and well as in Europe during the fourth quarter significantly lowered year-over-year revenues. In addition, lower residential volume in North America was a result of lower same store sales at large customers and ongoing weakness in the new homebuilder channel.

2007 vs 2006

For the year ended December 31, 2007, net revenues increased by 10.0% or $228.6 million, compared with the same period of 2006. The primary drivers were higher volumes and product mix (5%) and improved product pricing (4%).

Operating income increased by 8.3% or $33.3 million during 2007. During the year, we recorded $5.3 million of restructuring charges relating to ongoing cost reduction efforts, including workforce reductions and the consolidation of manufacturing facilities. Excluding these costs, operating income would have been $438.8 million, increasing the operating margin to 17.5% from 17.2%.

On an adjusted basis, operating income for the year ended December 31, 2007 increased by 9.6% or $38.6 million compared with the same period of 2006. The increase was due to improved product pricing ($84 million) and increased productivity ($15 million). These gains were partially offset by higher material costs ($35 million), lower volumes ($16 million) and new product development ($6 million).

Net revenues grew in all regions during the year benefiting from strong worldwide commercial construction markets, especially in schools, universities and health-care facilities. Revenues from electronic access control and mechanical products also increased year-over-year. Market share gains from both the new home-builder channel and large retail customers increased revenue along with the introduction of residential electronic products and new product designs. These increases helped offset the effects of a declining North American residential market.

Discontinued Operations

The components of discontinued operations for the years ended December 31 are as follows:


In millions		2008			2007			2006
Revenues	$	15.3		$	2,957.8		$	3,375.7


Pre-tax earnings (loss) from operations		(50.3	)		(82.5	)		376.6
Pre-tax gain (loss) on sale		(5.2	)		4,382.6			1.1
Tax benefit (expense)		(1.9	)		(1,066.5	)		(110.2	)
Discontinued operations, net	$	(57.4	)	$	3,233.6		$	267.5

Pre-tax loss from operations in 2007 includes a non-cash charge of $449.0 million related to our liability for all pending and estimated future asbestos claims through 2053 as discussed below in “Other Discontinued Operations.”

Discontinued operations by business for the years ended December 31 are as follows:


In millions		2008			2007			2006
Compact Equipment, net of tax	$	(11.7	)	$	2,927.1		$	240.4
Road Development, net of tax		(29.8	)		672.5			62.9
Other discontinued operations, net of tax		(15.9	)		(366.0	)		(35.8	)
Total discontinued operations, net of tax	$	(57.4	)	$	3,233.6		$	267.5

Compact Equipment Divestiture

On July 29, 2007, we agreed to sell our Bobcat, Utility Equipment and Attachments business units (collectively, Compact Equipment) to Doosan Infracore for gross proceeds of approximately $4.9 billion, subject to post closing purchase price adjustments. The sale was completed on November 30, 2007. We are currently in the process of resolving the final purchase price adjustments with Doosan Infracore.

Compact Equipment manufactured and sold compact equipment, including skid-steer loaders, compact track loaders, mini-excavators and telescopic tool handlers; portable air compressors, generators and light towers; general-purpose light construction equipment; and attachments. We have accounted for Compact Equipment as discontinued operations and classified the assets and liabilities as held for sale for all periods presented in accordance with Statement of Financial Accounting Standard No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (SFAS 144).

Net revenues and after-tax earnings of Compact Equipment for the years ended December 31 were as follows:


In millions		2008			2007		2006
Net revenues	$	15.3		$	2,705.9	$	2,648.4


After-tax earnings (loss) from operations	$	(0.6	)	$	275.1	$	240.4
Gain (loss) on sale, net of tax		(11.1	)		2,652.0		-
Total discontinued operations, net of tax	$	(11.7	)	$	2,927.1	$	240.4

Road Development Divestiture

On February 27, 2007, we agreed to sell our Road Development business unit to AB Volvo (publ) for cash proceeds of approximately $1.3 billion. The sale was completed on April 30, 2007.

The Road Development business unit manufactured and sold asphalt paving equipment, compaction equipment, milling machines and construction-related material handling equipment. We have accounted for the Road Development business unit as discontinued operations and classified the assets and liabilities sold to AB Volvo as held for sale for all periods presented in accordance with SFAS 144.

Net revenues and after-tax earnings of the Road Development business unit for the years ended December 31 were as follows:


In millions		2008		2007		2006
Net revenues	$	-	$	251.9	$	727.3


After-tax earnings (loss) from operations	$	(0.4)	$	37.8	$	62.9
Gain (loss) on sale, net of tax		(29.4)		634.7		-

Total discontinued operations, net of tax	$	(29.8)	$	672.5	$	62.9

Other Discontinued Operations

We also have retained costs from previously sold businesses that mainly include costs related to postretirement benefits, product liability and legal costs (mostly asbestos-related). The components of other discontinued operations for the years ended December 31 were as follows:


In millions		2008		2007		2006
Retained costs, net of tax	$	(16.7)	$	(340.9)	$	(36.5)
Net gain (loss) on disposals, net of tax		0.8		(25.1)		0.7

Total discontinued operations, net of tax	$	(15.9)	$	(366.0)	$	(35.8)

Retained costs, net of tax for the year ended December 31, 2008 includes $6.5 million of after-tax costs related to an adverse verdict in a product liability lawsuit associated with a previously divested business.

During the fourth quarter of 2007, we recorded a non-cash charge of $449.0 million ($277 million after-tax) related to our liability for all pending and estimated future asbestos claims through 2053. Refer to Note 22 in the consolidated financial statements for further details on asbestos-related matters.

Liquidity and Capital Resources

The global financial markets have been adversely affected by the current economic environment. The credit markets, including the commercial paper markets, have recently experienced adverse conditions including unprecedented volatility, reduced liquidity and increased interest rates. These factors generally increase the costs associated with issuing commercial paper or other debt instruments and may affect the ability of borrowers to access these markets.

To date, our availability of funding has not been materially impacted by the recent turmoil in the credit markets. We currently believe that our cash and cash equivalents balance, the cash generated by our operations, our receivable securitization program, our committed credit lines as well as our expected ability to access the capital markets will be sufficient to meet our operating and capital needs for the foreseeable future.

Liquidity

The following table contains several key measures to gauge our financial condition and liquidity at the period ended December 31:


In millions		2008		2007		2006
Cash and cash equivalents	$	550.2	$	4,735.3	$	355.8
Short-term borrowings and current maturities of long-term debt		2,350.4		741.0		1,079.4
Long-term debt		2,773.7		712.7		905.2
Total debt		5,124.1		1,453.7		1,984.6
Total shareholders’ equity		6,661.4		7,907.9		5,404.8
Debt-to-total capital ratio		43.1%		15.4%		26.6%

The large cash and cash equivalents balance at December 31, 2007 is attributable to the sale of both the Compact Equipment and the Road Development business units during 2007, which generated proceeds of $6,154.3 million. The lower cash and cash equivalents balance at December 31, 2008 is a result of the acquisition of Trane.

In connection with the Trane acquisition, we entered into a $3.9 billion senior unsecured bridge loan facility, with a 364-day term. We drew down $2.95 billion against the bridge loan facility in June 2008. The proceeds, along with cash on hand and the issuance of $1.5 billion in commercial paper, were used to fund the cash component of the consideration paid for the acquisition as well as to pay for related fees and expenses incurred in connection with the acquisition.

In August 2008, we filed a universal shelf registration statement with the Securities and Exchange Commission (SEC) for an indeterminate amount of securities for future issuance and issued $1.6 billion of long-term debt pursuant to the shelf registration statement through our wholly owned subsidiary, IR Global Holding Company Limited. This issuance consisted of $250 million Senior Floating Rate Notes due in 2010, $600 million 6.000% Senior Notes due in 2013 and $750 million 6.875% Senior Notes due in 2018. These notes are fully and unconditionally guaranteed by IR- Limited. The net proceeds from the offering were used to reduce the amount outstanding under the senior unsecured bridge loan facility.

Interest on the fixed rate notes will be paid twice a year. We have the option to redeem them in whole or in part at any time, and from time to time, prior to their stated maturity date at redemption prices set forth in the debt offering documents. Interest on the floating rate notes will be paid four times a year. The notes are subject to certain customary covenants, however, none of these covenants are considered restrictive to our operations.

We repaid $0.5 billion of the outstanding balance under our commercial paper program during 2008. As of December 31, 2008, we had outstanding commercial paper borrowings of $1.0 billion. We expect to fund future maturities of commercial paper through new commercial paper issuances and cash generated from our operations.

In addition, we repaid $2.0 billion of our outstanding balance of the bridge loan facility during the third quarter of 2008. We used a combination of cash flows from operations and cash on hand, in addition to the $1.6 billion in proceeds received from the issuance of long-term debt. In October 2008, we reduced the facility size to $950 million. As of December 31, 2008, our outstanding balance of the senior unsecured bridge loan facility was $754 million after a $196 million payment in the fourth quarter of 2008. The balance is scheduled to mature in June 2009. We expect to repay the outstanding amount through an expansion of our accounts receivable securitization program, future debt issuances and/or an extension of the bridge loan facility for an additional 364 days.

Debentures with Put Feature

At December 31, 2007, we had outstanding $547.9 million of fixed rate debentures which only requires early repayment at the option of the holder. These debentures contain a put feature that the holders may exercise on each anniversary of the issuance date. If exercised, we are obligated to repay in whole or in part, at the holder’s option, the outstanding principal amount (plus accrued and unpaid interest) of the debentures held by the holder. If these options are not exercised, the final maturity dates would range between 2027 and 2028.

In the fourth quarter of 2008, holders of these debentures chose to exercise the put feature on approximately $202 million of the debentures, which was repaid in November 2008. As a result, approximately $346 million remained outstanding as of December 31, 2008. In the first quarter of 2009, holders of these debentures will have the option to exercise the put feature on approximately $39 million

of the remaining debentures. In the fourth quarter of 2009, holders of these debentures will have the option to exercise the put feature on approximately $307 million of the remaining debentures. Based on our cash flow forecast, we believe we will have sufficient liquidity to repay any amounts redeemable as a result of these put features.

Pension Plans

We monitor the impact of market conditions on our funding requirements and pension plan expense on a quarterly basis. As a result of the current market environment, our pension plans have experienced negative returns of $523.2 million during 2008. Consequently, this will increase pension expense in 2009 and require cash contributions to our pension plan. However, none of our pension plans have experienced any significant impact on their liquidity to pay retirees in the plans due to the volatility in the markets. For further details on pension plan activity, see Note 15 to the consolidated financial statements.

Cash Flows

The following table reflects the major categories of cash flows for the years ended December 31, respectively. For additional details, please see the Consolidated Statements of Cash Flows in the consolidated financial statements.


In millions		2008			2007			2006
Operating cash flow provided by (used in) continuing operations	$	356.8		$	829.9		$	813.1
Investing cash flow provided by (used in) continuing operations		(7,306.4	)		6,052.4			(28.7	)
Financing cash flow provided by (used in) continuing operations		2,778.1			(2,563.1	)		(1,343.2	)

Operating Activities

Net cash provided by operating activities from continuing operations was $356.8 million for the year ended December 31, 2008 compared with $829.9 million in 2007. The change was primarily related to tax payments of approximately $1.1 billion paid to various taxing authorities, $594.4 million associated with the Compact Equipment divestiture. Tax payments in 2007 were approximately $470 million. In addition, cash flows from operating activities include Trane cash flows from operations since the Acquisition Date.

Net cash provided by operating activities from continuing operations increased to $829.9 million for the year ended December 31, 2007 compared with $813.1 in 2006. The change was primarily due to higher cash-based earnings in 2007 in addition to improved working capital management. However, these improvements were partially offset by the $217 million payment to the IRS made during 2007. For further details regarding this tax payment, see Note 19 in the consolidated financial statements.

Investing Activities

Net cash used by investing activities from continuing operations was $7,306.4 million for the year ended December 31, 2008 compared with net cash provided by continuing operations of $6,052.4 million in 2007. The change is primarily attributable to cash used for the acquisition of Trane in 2008. In addition, during the year ended December 31, 2007, net cash proceeds of $6,154.3 million was received related to the sale of Compact Equipment and the Road Development business unit.

Net cash provided by investing activities from continuing operations was $6,052.4 million for the year ended December 31, 2007 compared with net cash used in investing activities from continuing

operations of $28.7 million in 2006. The large change in investing activities was primarily attributable to the net proceeds of $6,154.3 million from the sale of Compact Equipment and the Road Development business unit in 2007.

Financing Activities

Net cash provided by financing activities from continuing operations was $2,778.1 million for the year ended December 31, 2008 compared with $2,563.1 million of net cash used in financing activities during 2007. The change in financing activities primarily relates to the outstanding balance of both our bridge loan facility and commercial paper which were used to finance the acquisition of Trane. In addition, $1.6 billion relates to the net proceeds from our long-term debt issuance in August 2008.

Net cash used in financing activities from continuing operations was $2,563.1 million for the year ended December 31, 2007 compared with $1,343.2 million in 2006. The change in financing activities was primarily due to the increase in repurchases of Class A common shares and the repayment of $551.7 million of short-term and long-term debt. During 2007, we repurchased approximately 39.7 million Class A common shares at a cost of $1,999.9 million. During 2006, we repurchased 27.7 million Class A common shares at a cost of $1,096.3 million.

Capital Resources

Based on historical performance and current expectations, we believe our cash and cash equivalents balance, the cash generated from our operations, our receivable securitization program, our committed credit lines and our expected ability to access capital markets will satisfy our working capital needs, capital expenditures and other liquidity requirements associated with our operations through at least the next 12 months.

Capital expenditures were $306.0 million, $119.7 million and $144.8 million for 2008, 2007 and 2006, respectively. Our investments continue to improve manufacturing productivity, reduce costs and provide environmental enhancements and advanced technologies for existing facilities. The capital expenditure program for 2009 is estimated to be approximately $325 million, including amounts approved in prior periods. Many of these projects are subject to review and cancellation at our option without incurring substantial charges.

During 2007, we initiated restructuring actions relating to ongoing cost reduction efforts across each of our sectors. These actions include both workforce reductions as well as the consolidation of manufacturing facilities. In addition, we announced plans to initiate enterprise-wide restructuring actions in October 2008. These actions include streamlining the footprint of manufacturing facilities and reducing the general and administrative cost base. Projected costs will approximate $110 million. As of December 31, 2008, we have incurred $71 million of costs associated with this restructuring.

For financial market risk impacting the Company, see Item 7A. Quantitative and Qualitative Disclosure About Market Risk.

Capitalization

In addition to cash on hand and operating cash flow, we maintain significant credit availability under our commercial paper programs. Our ability to borrow at a cost-effective rate under the commercial paper programs is contingent upon maintaining an investment-grade credit rating. As of December 31, 2008, our credit ratings were as follows:


	Short-term	Long-term
Moody’s	P-2	Baa1
Standard and Poor’s	A-2	BBB+

The credit ratings set forth above are not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal by the assigning rating organization. Each rating should be evaluated independently of any other rating.

In June 2008, we entered into a $1.0 billion senior unsecured revolving credit facility with a three-year term. The line is unused and provides support for our commercial paper program as well as for other general corporate purposes.

In addition to the three-year credit facility, we have committed revolving credit facilities consisting of two lines totaling $2.0 billion, of which $750 million expires in June 2009 and $1.25 billion expires in August 2010. These lines are unused and provide support for our commercial paper program as well as for other general corporate purposes. Other available lines of credit were $811.7 million, of which $651.3 million were unused at December 31, 2008. These lines provide support for bank guarantees, letters of credit and other general corporate purposes.

Our public debt does not contain any financial covenants and our revolving credit lines have a debt-to-total capital covenant of 65%. As of December 31, 2008, our debt-to-total capital ratio was significantly beneath this limit.

Contractual Obligations

The following table summarizes our contractual cash obligations by required payment periods, in millions:


		Less than 1 year			1 - 3 years		3 - 5 years		More than 5 years		Total
Short-term debt	$	1,802.0		$	-	$	-	$	-	$	1,802.0
Long-term debt		548.4	*		537.1		619.7		1,616.9		3,322.1
Interest payments on long-term debt		177.8			295.6		278.2		870.9		1,622.5
Purchase obligations		994.8			47.0		3.5		-		1,045.3
Operating leases		169.9			233.1		142.0		102.5		647.5
Total contractual cash obligations	$	3,692.9		$	1,112.8	$	1,043.4	$	2,590.3	$	8,439.4

* Includes $345.7 million of debt redeemable at the option of the holder. The scheduled maturities of these bonds range between 2027 and 2028.

Future expected obligations under our pension and postretirement benefit plans, income taxes, environmental and asbestos matters have not been included in the contractual cash obligations table above.

Pensions

In 2006, we adopted Statement of Financial Accounting Standard (SFAS) No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of Financial Accounting Standards Board (FASB) Statements No. 87, 88, 106 and 132(R)” (SFAS 158), which required us to record the funded status of our pension plans on the balance sheet effective December 31, 2006.

In 2008, we adopted the measurement provision of SFAS 158 which required us to measure plan assets and benefit obligations as of the date of our fiscal year-end financial statements. Therefore, we changed the measurement date for our defined benefit plans from November 30 to December 31. We elected the alternative transition method whereby we determined net periodic pension cost for the 13 month period from December 1, 2007 to December 31, 2008 and allocated net periodic pension cost proportionately between amounts to be recognized as an adjustment of retained earnings and net periodic pension cost. As a result, we recorded a one-time after-tax pension charge of $1.2 million to Retained earnings ($1.8 million pre-tax). This change did not impact plans acquired through acquisitions in 2008.

At December 31, 2008, we had net obligations on our balance sheet of $854.2 million, which consist of long-term prepaid pension costs of $0.2 million and current and non-current pension benefits liabilities of $854.4 million. As a result of the Trane acquisition, we recognized net obligations on our balance sheet at the Acquisition Date of $67.7 million, which consisted of long-term prepaid pension costs of $1.4 million and current and non-current pension benefit liabilities of $69.1 million. It is our objective to contribute to the pension plans to ensure adequate funds are available in the plans to make benefit payments to plan participants when required. However, certain plans are not or cannot be funded due to either legal or tax requirements in certain jurisdictions. As of December 31, 2008, approximately seven percent of our projected benefit obligation relates to plans that are unfunded.

Our investment objectives in managing defined benefit plan assets are to ensure that present and future benefit obligations to all participants and beneficiaries are met as they become due; to provide a total return that, over the long term, minimizes our required contributions at the appropriate levels of risk; and to meet any statutory requirements, laws and local regulatory agencies’ requirements. Key investment management decisions reviewed regularly are asset allocations, investment manager performance, investment advisors and trustees. Asset/liability modeling (ALM) studies are used as the basis for global asset allocation decisions and are updated as required.

Based on ALM studies, the Company continues to adjust its target strategic global asset allocations for its plans to be approximately 40% in equity securities and 60% in debt securities, real estate and cash. Asset allocations are reviewed at least quarterly and appropriate adjustments are made. Trane pension assets have been included in our reviews since acquisition and will be included in our target strategic asset allocation. Trane’s historic target strategic allocation had a higher percentage invested in equity securities.

As of December 31, 2008, our asset allocation for the pension plans was 41% in equity securities and 52% in debt securities, and 7% real estate and other (including cash). Our allocation has been impacted by the current market environment.

Contributions to our pension plans were $64.1 million in 2008, $25.5 million in 2007, and $31.6 million in 2006. Our policy allows us to fund an amount, which could be in excess-of or less than pension cost expensed, subject to the limitations imposed by current tax regulations. We anticipate funding the plans in 2009 in accordance with contributions required by funding regulations or the laws of each jurisdiction and currently project that we will be required to contribute approximately $105 million to our plans worldwide in 2009.

Our pension plans for U.S. non-collectively bargained employees, excluding Trane employees, provide benefits on a final average pay formula. Trane maintains a pension plan for Trane non-collectively bargained U.S. employees, where eligible employees may elect to participate and receive a credit equal to 3% of eligible pay. Collectively bargained pension plans, including Trane plans, principally provide benefits based on a flat benefit formula. Non-U.S. plans usually provide benefits based on an earnings and years of service formula. Additional supplemental benefit plans are maintained by us for officers and other key employees. Pension benefit payments are expected to be paid as follows: $214.5 million in 2009, $242.0 million in 2010, $207.6 million in 2011, $218.9 million in 2012, $229.6 million in 2013 and $1,228.0 million for the years 2014 to 2018.

Net pension cost is based on the weighted-average assumptions used at the end of the previous year to calculate the pension benefit obligation, adjusted for any curtailment and settlement gains or losses, if any. Trane plans were based on assumptions determined at the Acquisition Date. Net periodic pension cost for 2008 was $31.0 million, of which $7.3 million related to Trane plans. The details of net periodic pension cost for 2008, 2007 and 2006 were as follows:


In millions		2008			2007		2006
Net periodic pension benefit cost	$	31.0		$	11.5	$	32.7
Net curtailment and settlement (gains) losses		2.3			63.5		-
Net periodic pension benefit (income) cost after net curtailment and settlement (gains) losses	$	33.3		$	75.0	$	32.7


Amounts recorded in continuing operations	$	44.8		$	20.6	$	38.3
Amounts recorded in discontinued operations		(11.5	)		54.4		(5.6	)
Total	$	33.3		$	75.0	$	32.7

Net periodic pension cost for 2009 is projected to be approximately $160 million, of which $45 million relates to Trane pension plans.

Postretirement Benefits Other Than Pensions

In 2006, we adopted SFAS 158, which requires us to record the funded status of our postretirement plans on the balance sheet effective December 31, 2006. The adoption of SFAS 158 for the Company’s postretirement plans other than pensions resulted in an increase of total liabilities of $300.4 million and a decrease of total shareholder’s equity of $135.7 million (net of tax of $164.7 million).

In 2008, we adopted the measurement provision of SFAS 158 which required us to measure plan assets and benefit obligations as of the date of our fiscal year-end financial statements. Therefore, we changed the measurement date for our defined benefit plans from November 30 to December 31. We elected the alternative transition method whereby we determined net periodic pension cost for the 13 month period from December 1, 2007 to December 31, 2008 and allocated net periodic postretirement benefit cost proportionately between amounts to be recognized as an adjustment of retained earnings and net periodic pension cost. As a result, we recorded a one-time after-tax charge for postretirement benefits of $2.5 million to Retained earnings ($4.7 million pre-tax).

As a result of the acquisition of Trane on June 5, 2008, we assumed unfunded obligations for postretirement benefits other than pensions in the amount of $268.9 million.

We fund postretirement benefit costs principally on a pay-as-you-go basis. Benefit payments for postretirement benefits, which are net of expected plan participant contributions and Medicare Part D subsidy, are expected to be paid as follows: $71.1 million in 2009, $73.4 million in 2010, $70.9 million in 2011, $76.7 million in 2012, $76.1 million in 2013 and $378.4 million for the years 2014 to 2018.

Net periodic postretirement benefit cost is based on the weighted-average assumptions used at the end of the previous year to calculate the postretirement benefit obligation, adjusted for any curtailment and settlement gains or losses, if any. Trane plans were based on assumptions determined at the Acquisition Date. Net periodic postretirement benefit cost for 2008 totaled $69.8 million, of which $13.2 million related to Trane plans. The details of net periodic postretirement cost for 2008, 2007 and 2006 were as follows:


In millions		2008		2007		2006
Net periodic postretirement benefit cost	$	69.8	$	78.1	$	79.2
Net curtailment and settlement (gains) losses		-		(265.9)		-
Net periodic postretirement benefit (income) cost after net curtailment and settlement (gains) losses	$	69.8	$	(187.8)	$	79.2

Amounts recorded in continuing operations	$	38.4	$	22.7	$	25.7
Amounts recorded in discontinued operations		31.4		(210.5)		53.5
Total	$	69.8	$	(187.8)	$	79.2

Net periodic postretirement benefit cost for 2009 is projected to be approximately $81 million, of which $23 million relates to Trane postretirement plans.

Income Taxes

Effective January 1, 2007, the Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement 109” (FIN 48), which prescribes a recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return. Additionally, FIN 48 provides guidance on the recognition, classification, accounting in interim periods and disclosure requirements for uncertain tax positions. As a result of adopting FIN 48, the company recorded additional liabilities to its previously established reserves, and a corresponding decrease in retained earnings of $145.6 million. The Company has total unrecognized tax benefits of $589.6 million as of December 31, 2008.

The provision for income taxes involves a significant amount of management judgment regarding interpretation of relevant facts and laws in the jurisdictions in which the Company operates. Future changes in applicable laws, projected levels of taxable income and tax planning could change the effective tax rate and tax balances recorded by the Company. In addition, U.S. and non-U.S. tax authorities periodically review income tax returns filed by the Company and can raise issues regarding its filing positions, timing and amount of income or deductions, and the allocation of income among the jurisdictions in which the Company operates. A significant period of time may elapse between the filing of an income tax return and the ultimate resolution of an issue raised by a revenue authority with respect to that return. In the normal course of business the Company is subject to examination by taxing authorities throughout the world, including such major jurisdictions as Germany, Italy, the Netherlands and the United States. In general, the examination of the Company’s material tax returns is completed for the years prior to 2000.

The Internal Revenue Service (IRS) has completed the examination of the Company’s federal income tax returns through the 2000 tax year and has issued a notice proposing adjustments. The principal proposed adjustment relates to the disallowance of certain capital losses. The Company disputes the IRS position and protests have been filed with the IRS Appeals Division. In order to reduce the potential interest expense associated with this matter, the Company made a payment of $217 million in the third quarter of 2007, which reduced the Company’s total liability for uncertain tax positions by $141 million. Similarly, during the third quarter of 2008, the Company made an additional payment of $55.1 million related to a potential penalty assessment plus accrued interest on this matter. The Company continues

negotiating with the IRS on the ultimate settlement of this matter. The issues raised by the IRS associated with this payment are not related to the Company’s reorganization in Bermuda, or the Company’s intercompany debt structure.

The Company believes that it has adequately provided for any reasonably foreseeable resolution of any tax disputes, but will adjust its reserves if events so dictate in accordance with FIN 48. To the extent that the ultimate results differ from the original or adjusted estimates of the Company, the effect will be recorded in the provision for income taxes.

Commitments and Contingencies

We are involved in various litigations, claims and administrative proceedings, including environmental and product liability matters. Amounts recorded for identified contingent liabilities are estimates, which are reviewed periodically and adjusted to reflect additional information when it becomes available. Subject to the uncertainties inherent in estimating future costs for contingent liabilities, management believes that the liability which may result from these legal matters would not have a material adverse effect on the financial condition, results of operations, liquidity or cash flows.

Environmental Matters

We continue to be dedicated to an environmental program to reduce the utilization and generation of hazardous materials during the manufacturing process and to remediate identified environmental concerns. As to the latter, we are currently engaged in site investigations and remediation activities to address environmental cleanup from past operations at current and former manufacturing facilities.

We are sometimes a party to environmental lawsuits and claims and have received notices of potential violations of environmental laws and regulations from the Environmental Protection Agency and similar state authorities. We have also been identified as a potentially responsible party (PRP) for cleanup costs associated with off-site waste disposal at federal Superfund and state remediation sites. For all such sites, there are other PRPs and, in most instances, our involvement is minimal.

In estimating our liability, we have assumed we will not bear the entire cost of remediation of any site to the exclusion of other PRPs who may be jointly and severally liable. The ability of other PRPs to participate has been taken into account, based generally on the parties’ financial condition and probable contributions on a per site basis. Additional lawsuits and claims involving environmental matters are likely to arise from time to time in the future.

For a further discussion of our potential environmental liabilities, see Note 22 in the consolidated financial statements.

Asbestos Matters

Prior to the fourth quarter of 2007, the Company recorded a liability (which it periodically updated) for its actual and anticipated future asbestos settlement costs projected seven years into the future. The Company did not record a liability for future asbestos settlement costs beyond the seven-year period covered by its reserve because such costs previously were not reasonably estimable for the reasons detailed below.

In the fourth quarter of 2007, the Company again reviewed its history and experience with asbestos-related litigation and determined that it had now become possible to make a reasonable estimate of its total liability for pending and unasserted potential future asbestos-related claims. This determination was based upon the Company’s analysis of developments in asbestos litigation, including the substantial and continuing decline in the filing of non-malignancy claims against the Company, the establishment in many jurisdictions of inactive or deferral dockets for such claims, the decreased value of non-malignancy claims because of changes in the legal and judicial treatment of such claims, increasing focus of the asbestos litigation upon malignancy claims, primarily those involving mesothelioma, a cancer with a known historical and predictable future annual incidence rate, and the Company’s substantial accumulated experience with respect to the resolution of malignancy claims, particularly mesothelioma claims, filed against it.

Accordingly, in the fourth quarter of 2007, the Company retained Dr. Thomas Vasquez of Analysis, Research & Planning Corporation (collectively, “ARPC”) to assist it in calculating an estimate of the Company’s total liability for pending and unasserted future asbestos-related claims. ARPC is a respected expert in performing complex calculations such as this. ARPC has been involved in many asbestos-related valuations of current and future liabilities, and its valuation methodologies have been accepted by numerous courts.

The methodology used by ARPC to project the Company’s total liability for pending and unasserted potential future asbestos-related claims relied upon and included the following factors, among others:

•

ARPC’s interpretation of a widely accepted forecast of the population likely to have been occupationally exposed to asbestos;

•

epidemiological studies estimating the number of people likely to develop asbestos-related diseases such as mesothelioma and lung cancer;

•

the Company’s historical experience with the filing of non-malignancy claims against it and the historical ratio between the numbers of non-malignancy and lung cancer claims filed against the Company;

•

ARPC’s analysis of the number of people likely to file an asbestos-related personal injury claim against the Company based on such epidemiological and historical data and the Company’s most recent three-year claims history;

•

an analysis of the Company’s pending cases, by type of disease claimed;

•

an analysis of the Company’s most recent three-year history to determine the average settlement and resolution value of claims, by type of disease claimed;

•

an adjustment for inflation in the future average settlement value of claims, at a 2.5% annual inflation rate, adjusted downward to 1.5% to take account of the declining value of claims resulting from the aging of the claimant population;

•

an analysis of the period over which the Company has and is likely to resolve asbestos-related claims against it in the future.

Based on these factors, ARPC calculated a total estimated liability of $755 million for the Company to resolve all pending and unasserted potential future claims through 2053, which is ARPC’s reasonable best estimate of the time it will take to resolve asbestos-related claims. This amount is on a pre-tax basis, not discounted for the time-value of money, and excludes the Company’s defense fees (which will continue to be expensed by the Company as they are incurred). After considering ARPC’s analysis and the factors listed above, in the fourth quarter of 2007, the Company increased its recorded liability for asbestos claims by $538 million, from $217 million to $755 million.

In addition, during the fourth quarter of 2007, the Company recorded an $89 million increase in its assets for probable asbestos-related insurance recoveries to $250 million. This represents amounts due to the Company for previously paid and settled claims and the probable reimbursements relating to its estimated liability for pending and future claims. In calculating this amount, the Company used the estimated asbestos liability for pending and projected future claims calculated by ARPC. It also considered the amount of insurance available, gaps in coverage, allocation methodologies, solvency ratings and creditworthiness of the insurers, the amounts already recovered from and the potential for settlements with insurers, and the terms of existing settlement agreements with insurers.

During the fourth quarter of 2007, the Company recorded a non-cash charge to earnings of discontinued operations of $449 million ($277 million after-tax), which is the difference between the amount by which the Company increased its total estimated liability for pending and projected future asbestos-related claims and the amount that the Company expects to recover from insurers with respect to that increased liability.

In connection with our acquisition of Trane, the Company requested ARPC to assist in calculating Trane’s asbestos-related valuations of current and future liabilities. As required by SFAS No. 141, “Business Combinations,” the Company is required to record the assumed asbestos obligations and associated insurance-related assets at their fair value at the Acquisition Date. The Company preliminarily estimates that the assumed asbestos obligation and associated insurance-related assets at the Acquisition Date to be $494 million and $249 million, respectively. These amounts were estimated based on certain assumptions and factors consistent with those described above.

Trane continues to be in litigation against certain carriers whose policies it believes provide coverage for asbestos claims. The insurance carriers named in this suit have challenged Trane’s right to recovery. Trane filed the action in April 1999 in the Superior Court of New Jersey, Middlesex County, against various primary and lower layer excess insurance carriers, seeking coverage for environmental claims (the “NJ Litigation”). The NJ Litigation was later expanded to also seek coverage for asbestos-related liabilities from twenty-one primary and lower layer excess carriers and underwriting syndicates. The environmental claims against most of the insurers in the NJ Litigation have been settled. On September 19, 2005, the court granted Trane’s motion to add claims for insurance coverage for asbestos-related liabilities against 16 additional insurers and 117 new insurance policies to the NJ Litigation. The court also required the parties to submit all contested matters to mediation. Trane engaged in its first mediation session with the NJ Litigation defendants on January 18, 2006 and has engaged in active discussions since that time.

Trane has now settled with a substantial number of its insurers, collectively accounting for approximately 80% of its recorded asbestos-related liability insurance receivable as of January 31, 2009. More specifically, effective August 26, 2008, Trane entered into a coverage-in-place agreement (“August 26 Agreement”) with the following five insurance companies or groups: 1) Hartford; 2) Travelers; 3) Allstate (solely in its capacity as successor-in-interest to Northbrook Excess & Surplus Insurance Company); 4) Dairyland Insurance Company; and 5) AIG. The August 26 Agreement provides for the reimbursement by the insurer signatories of a portion of Trane’s costs for asbestos bodily injury claims under specified terms and conditions and in exchange for certain releases and indemnifications from Trane. In addition, on September 12, 2008, Trane entered into a settlement agreement with Mt. McKinley Insurance Company and Everest Reinsurance Company, both members of the Everest Re group, resolving all claims in the NJ Litigation involving policies issued by those companies (“Everest Re Agreement”). The Everest Re Agreement contains a number of elements, including policy buy-outs and partial buy-outs in exchange for a cash payment along with coverage-in-place features similar to those contained in the August 26 Agreement, in exchange for certain releases and indemnifications by Trane. More recently, on January 26, 2009, Trane entered into a coverage-in-place agreement with Columbia Casualty Company, Continental Casualty Company, and Continental Insurance Company in its own capacity and as successor-in-interest to Harbor Insurance Company and London Guarantee & Accident Company of New York (“CNA Agreement”). The CNA Agreement provides for the reimbursement by the insurer signatories of a portion of Trane’s costs for indemnification from Trane. Trane remains in settlement negotiations with the insurer defendants in the NJ Litigation not encompassed within the August 26 Agreement, Everest Re Agreement, and the CNA Agreement. Once concluded, we believe NJ Litigation will resolve coverage issues with respect to approximately 95% of Trane’s recorded insurance receivable in connection with asbestos-related liabilities.

The amounts recorded by the Company for asbestos-related liabilities and insurance-related assets are based on currently available information. The Company’s actual liabilities or insurance recoveries could be significantly higher or lower than those recorded if assumptions used in the Company’s or ARPC’s calculations vary significantly from actual results. Key variables in these assumptions are identified above and include the number and type of new claims to be filed each year, the average cost of resolution of each such new claim, the resolution of coverage issues with insurance carriers, and the solvency risk with respect to the Company’s insurance carriers. Furthermore, predictions with respect to these variables are subject to greater uncertainty as the projection period lengthens. Other factors that may affect the Company’s liability include uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, reforms that may be made by state and federal courts, and the passage of state or federal tort reform legislation.

The aggregate amount of the stated limits in insurance policies available to the Company for asbestos-related claims acquired over many years and from many different carriers, is substantial. However, limitations in that coverage, primarily due to the considerations described above, are expected to result in the projected total liability to claimants substantially exceeding the probable insurance recovery.

From receipt of its first asbestos claims more than twenty five years ago to December 31, 2008, the Company has resolved (by settlement or dismissal) approximately 253,000 claims arising from the legacy Ingersoll Rand businesses. The total amount of all settlements paid by the Company (excluding insurance recoveries) and by its insurance carriers is approximately $351 million, for an average payment per resolved claim of $1,387. The average payment per claim resolved during the year ended December 31, 2008 was $952. Because claims are frequently filed and settled in large groups, the amount and timing of settlements, as well as the number of open claims, can fluctuate significantly from period to period.

The table below provides additional information regarding asbestos-related claims filed against the legacy Ingersoll Rand businesses, excluding those filed against Trane, reflecting updated information for the last three years.


	2006		2007		2008
Open claims - January 1	102,968		101,709		100,623
New claims filed	6,457		5,398		4,567
Claims settled	(6,558	)	(5,005	)	(3,693	)
Claims dismissed *	(1,158	)	(1,479	)	(38,189	)
Open claims - December 31	101,709		100,623		63,308

* The significant increase in dismissals in 2008 is attributed to the dismissal of large numbers of dormant and/or inactive cases in Mississippi and New York. This amount reflects the Company’s emphasis on resolution of higher value malignancy claims, particularly mesothelioma claims, rather than lower value non-malignancy claims, which are more heavily represented in the Company’s historical settlements.

From receipt of the first asbestos claim more than twenty years ago through December 31, 2008, the Company has resolved approximately 74,000 (by settlement or dismissal) claims arising from the legacy Trane business. The Company and its insurance carriers have paid settlements of approximately $125.4 million on these claims, which represents an average payment per resolved claim of $1,694. At December 31, 2008, there were 98,339 open claims pending against Trane. Because claims are frequently filed and settled in large groups, the amount and timing of settlements, as well as the number of open claims, can fluctuate significantly from period to period.

The table below provides additional information regarding asbestos-related claims filed against the legacy Trane businesses, reflecting updated information for the last three years.


	2006		2007		2008
Open claims - January 1	113,730		104,570		105,023
New claims filed	4,440		3,019		3,626
Claims settled	(848	)	(740	)	(600	)
Claims dismissed	(12,752	)	(1,826	)	(9,710	)
Open claims - December 31	104,570		105,023		98,339

At December 31, 2008, over 90 percent of the open claims against the Company are non-malignancy claims, many of which have been placed on inactive or deferral dockets and the vast majority of which have little or no settlement value against the Company, particularly in light of recent changes in the legal and judicial treatment of such claims.

At December 31, 2008, the Company’s liability for asbestos related matters and the asset for probable asbestos-related insurance recoveries totaled $1,195.2 million and $423.8 million, respectively, compared to $754.9 million and $249.8 million at December 31, 2007.

The (costs) income associated with the settlement and defense of asbestos related claims after insurance recoveries were as follows:


		December 31,
In millions		2008			2007
Continuing operations	$	(1.5	)	$	-
Discontinued operations		(5.9	)		(311.3)
Total	$	(7.4	)	$	(311.3)

The Company records certain income and expenses associated with its asbestos liabilities and corresponding insurance recoveries within discontinued operations, as they relate to previously divested businesses, primarily Ingersoll-Dresser Pump, which was sold in 2000. Income and expenses associated with Trane’s asbestos liabilities and corresponding insurance recoveries are recorded within continuing operations.

The European Commission Investigation

subsidiaries (including certain subsidiaries formerly engaged in the Bath and Kitchen business) and their respective affiliates against, any fines related to this investigation. Trane and the charged subsidiaries responded to the European Commission on August 1, 2007 and July 31, 2007, respectively. A hearing with the European Commission regarding the response to the Statement of Objections was conducted from November 12-14, 2007, in Brussels. WABCO Europe and other former Trane subsidiaries participated in the hearing. Trane, however, did not participate in the hearing.

In 2006, the European Commission adopted new fining guidelines (2006 Guidelines) and stated its intention to apply these guidelines in all cases in which a Statement of Objections is issued after September 2006. In applying the 2006 Guidelines, the Commission retains considerable discretion in calculating the fine although the European Union regulations provide for a cap on the maximum fine equal to ten percent of Trane’s worldwide revenue attributable to all of its products for the fiscal year prior to the year in which the fine is imposed. If the maximum fine is levied in 2009, the total liability could be approximately $1.1 billion based on Trane’s last full fiscal year of worldwide revenue, subject to a probable reduction for leniency of at least 20 percent provided WABCO Europe, as the leniency applicant, fulfilled all conditions set forth in the European Commission’s leniency notice. WABCO has stated in its Form 10-K for the fiscal year ended December 31, 2008 that its ability to satisfy its obligations under the Indemnification Agreement is contingent on its funding capability at the time of the fine, which could be affected by, among other things, its ability to access its then existing credit facilities, its ability to obtain alternative sources of financing, its ability to obtain some payment relief from the European Commission or its ability to obtain a suspension of the payment obligation from the European Court of First Instance.

Other Matters

As previously reported, on November 10, 2004, the Securities and Exchange Commission (SEC) issued an Order directing that a number of public companies, including the Company, provide information relating to their participation in transactions under the United Nations’ Oil for Food Program. Upon receipt of the Order, the Company undertook a thorough review of its participation in the Oil for Food Program, provided the SEC with information responsive to the Order and provided additional information requested by the SEC. During a March 27, 2007 meeting with the SEC, at which a representative of the Department of Justice (DOJ) was also present, the Company began discussions concerning the resolution of this matter with both the SEC and DOJ. On October 31, 2007, the Company announced it had reached settlements with the SEC and DOJ relating to this matter. Under the terms of the settlements, the Company paid a total of $6.7 million in penalties, interest and disgorgement of profits. The Company has consented to the entry of a civil injunction in the SEC action and has entered into a three-year deferred prosecution agreement with the DOJ. Under both settlements, the Company has implemented and will continue to implement improvements to its compliance program that are consistent with its longstanding policy against improper payments. In the settlement documents, the Government noted that the Company thoroughly cooperated with the investigation, that the Company had conducted its own complete investigation of the conduct at issue, promptly and thoroughly reported its findings to them, and took prompt remedial measures.

under the FCPA and other applicable anti-corruption laws. We have indicated to the SEC and DOJ that we are conducting a thorough investigation of these matters and that we would report back to them with our findings. The investigation of these matters began in earnest promptly after our acquisition of Trane in June 2008 and is currently in progress. Previously, we had reported to the SEC and DOJ potential FCPA issues relating to one of our businesses in China, and we have reported back to them and shared our audit report, which indicated no FCPA violations. These matters (and other matters which may arise or of which we become aware in the future) may be deemed to violate the FCPA and other applicable anti-corruption laws. Such determinations could subject us to, among other things, further enforcement actions by the SEC or the DOJ (if, for example, the DOJ deems us to have violated the DPA), securities litigation and a general loss of investor confidence, any one of which could adversely affect our business prospects and the market value of our stock.

The following represents the changes in our product warranty liability for 2008 and 2007:


In millions		2008			2007
Balance at beginning of year	$	146.9		$	137.1
Reductions for payments		(207.7	)		(68.5	)
Accruals for warranties issued during the current period		246.7			80.1
Changes for accruals related to preexisting warranties		(22.9	)		(7.8	)
Acquisitions		483.3			-
Translation		(5.6	)		6.0

Balance at end of the year	$	640.7		$	146.9

Certain office and warehouse facilities, transportation vehicles and data processing equipment are leased. Total rental expense was $144.8 million in 2008, $72.2 million in 2007 and $68.2 million in 2006. Minimum lease payments required under non-cancelable operating leases with terms in excess of one year for the next five years and thereafter, are as follows: $169.9 million in 2009, $130.8 million in 2010, $102.3 million in 2011, $77.7 million in 2012, $64.3 million in 2013 and $102.5 million thereafter.

Trane has commitments and performance guarantees, including energy savings guarantees, totaling $108.4 million extending from 2008-2028. These guarantees are provided under long-term service and maintenance contracts related to its air conditioning equipment and system controls. Through 2008, the Company has experienced one insignificant loss under such arrangements and considers the probability of any significant future losses to be remote.

We have other contingent liabilities of $5.1 million. These liabilities primarily result from performance bonds, guarantees and stand-by letters of credit associated with the prior sale of products by divested businesses.

As part of the reorganization of IR-New Jersey in 2001, IR-Limited has fully and unconditionally guaranteed payment of all of IR-New Jersey’s issued public debt securities. No other subsidiary of ours guarantees these securities.

IR-New Jersey has unconditionally guaranteed payment of the principal, premium, if any, and interest on our 4.75% Senior Notes due in 2015 in aggregate principal amount of $300 million. The guarantee is unsecured and provided on an unsubordinated basis. The guarantee ranks equally in right of payment with all of the existing and future unsecured and unsubordinated debt of IR-New Jersey.

Public debt securities issued by IR Global Holding Company Limited are fully and unconditionally guaranteed by IR-Limited. No other subsidiary of ours guarantees these securities.

Critical Accounting Policies

Management’s Discussion and Analysis of Financial Condition and Results of Operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of financial statements in conformity with those accounting principles requires management to use judgment in making estimates and assumptions based on the relevant information available at the end of each period. These estimates and assumptions have a significant effect on reported amounts of assets and liabilities, revenue and expenses as well as the disclosure of contingent assets and liabilities because they result primarily from the need to make estimates and assumptions on matters that are inherently uncertain. Actual results may differ from estimates. The following is a summary of certain accounting estimates and assumptions made by management that we consider critical.

•

Allowance for doubtful accounts – The Company has provided an allowance for doubtful accounts receivable which represents the best estimate of probable loss inherent in the Company’s accounts receivable portfolio. This estimate is based upon the Company’s policy, derived from its knowledge of its end markets, customer base and products.

•

Goodwill and indefinite-lived intangible assets – We have significant goodwill and intangible assets on our balance sheet related to acquisitions. Our goodwill and other indefinite-lived intangible assets are tested and reviewed annually for impairment or when there is a significant change in circumstances. Recoverability of goodwill is measured at the reporting unit level and determined using a two step process. The first step compares the carrying amount of the reporting unit to its estimated fair value. To the extent that the carrying value of the reporting unit exceeds its estimated fair value, a second step is performed, wherein the reporting unit’s carrying value of goodwill is compared to the implied fair value of goodwill. To the extent that the carrying value exceeds the fair value, impairment exists and must be recognized. Recoverability of other intangible assets with indefinite useful lives is measured by a comparison of the carrying amount of the intangible assets to the fair value of the respective intangible assets. Any excess of the carrying value over the fair value is recognized as an impairment loss.

As discussed in Note 4 of the consolidated financial statements, we have recorded an impairment charge of approximately $3,710.0 million ($3,385.0 million after-tax) in the fourth quarter of 2008, based on the estimated fair value and book value of our reporting units. The determination of the reporting units estimated fair value requires management to make assumptions about estimated cash flows, including profit margins, long-term forecasts, discount rates and terminal growth rates. Management developed these assumptions based on the market and geographic risks unique to each reporting unit. The calculation of fair value is based on two valuation techniques, a discounted cash flow model (income approach) and a market adjusted multiple of earnings and revenues (market approach), with each method being equally weighted in the calculation. Under the income approach, we assumed a forecasted cash flow period of five years with discount rates generally ranging from 11%-15% and terminal growth rates generally ranging from 2%-5%. Under the market approach, management used an adjusted multiple of earnings and revenues based on the market information of comparable companies. Additionally, management compared the estimated aggregate fair value of its reporting units to the Company’s overall market capitalization.

The assumptions used represent management’s best estimate of fair value. For those reporting units that did not have impairment, the fair value of the reporting units exceeded the carrying value by at least 8%. Due to the ongoing uncertainty in market conditions, which may continue to negatively impact our market value, we will continue to monitor and evaluate the carrying value of goodwill and our indefinite-lived intangible assets. If market and economic conditions deteriorate further, this

could increase the likelihood of future non-cash impairment charges related to goodwill and/or our indefinite-lived intangible assets.

•

Long-lived assets and finite-lived intangibles – Long-lived assets and finite-lived intangibles are reviewed for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset may not be fully recoverable. Assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows can be generated. Impairment in the carrying value of an asset would be recognized whenever anticipated future undiscounted cash flows from an asset are less than its carrying value. The impairment is measured as the amount by which the carrying value exceeds the fair value of the asset as determined by an estimate of discounted cash flows. The Company believes that its use of estimates and assumptions are reasonable and comply with generally accepted accounting principles. Changes in business conditions could potentially require future adjustments to these valuations.

•

Loss contingencies – Liabilities are recorded for various contingencies arising in the normal course of business, including litigation and administrative proceedings, environmental and asbestos matters and product liability, product warranty, worker’s compensation and other claims. The Company has recorded reserves in the financial statements related to these matters, which are developed using input derived from actuarial estimates and historical and anticipated experience data depending on the nature of the reserve, and in certain instances with consultation of legal counsel, internal and external consultants and engineers. Subject to the uncertainties inherent in estimating future costs for these types of liabilities, the Company believes its estimated reserves are reasonable and does not believe the final determination of the liabilities with respect to these matters would have a material effect on the financial condition, results of operations, liquidity or cash flows of the Company for any year.

•

Asbestos matters – Certain wholly owned subsidiaries of the Company are named as defendants in asbestos-related lawsuits in state and federal courts. The Company records a liability for its actual and anticipated future claims as well as an asset for anticipated insurance settlements. Although the Company was neither a manufacturer or producer of asbestos, some of its formerly manufactured components from third party suppliers utilized asbestos related components. As a result, the Company records certain income and expenses associated with our asbestos liabilities and corresponding insurance recoveries within discontinued operations, net of tax, as they relate to previously divested businesses. Income and expenses associated with Trane’s asbestos liabilities and corresponding insurance recoveries are recorded within continuing operations. Refer to Note 22 in the consolidated financial statements for further details of asbestos-related matters.

•

Revenue recognition – Revenue is recognized and earned when all of the following criteria are satisfied: (a) persuasive evidence of a sales arrangement exists; (b) price is fixed or determinable; (c) collectibility is reasonably assured; and (d) delivery has occurred or service has been rendered. Delivery generally occurs when the title and the risks and rewards of ownership have substantially transferred to the customer. Revenue from maintenance contracts or extended warranties is recognized on a straight-line basis over the life of the contract, unless another method is more representative of the costs incurred. The Company enters into agreements that contain multiple elements, such as equipment, installation and service revenue. For multiple-element arrangements, the Company recognizes revenue for delivered elements when the delivered item has stand-alone value to the customer, fair values of undelivered elements are known, customer acceptance has occurred, and there are only customary refund or return rights related to the delivered elements. Revenues from certain of our equipment and the related installation sold under construction-type contracts are recorded using the percentage-of-completion method in accordance with Statement of

Position 81-1, “Accounting for Performance of Construction-Type and Certain Production-Type Contracts.” Revenues associated with contracts accounted for under the percentage of completion method of accounting amounted to approximately five percent of the Company’s 2008 net revenues.

•

Securitization of receivables – The Company has sold interests in accounts receivable to special purpose entities previously created by Trane as part of accounts receivable financing facilities established in the U.S. with a major international bank. At the time of sale, the receivables become legally isolated from the Company, the purchasers have the right to pledge or exchange the receivables and the purchasers obtain effective control over the receivables. For these reasons, receivables sold under such arrangements are removed from the balance sheet at the time they are sold. Any retained interests in receivables sold are carried at fair value in other current assets.

•

Income taxes – Deferred tax assets and liabilities are determined based on temporary differences between financial reporting and tax bases of assets and liabilities, applying enacted tax rates expected to be in effect for the year in which the differences are expected to reverse. The Company recognizes future tax benefits, such as net operating losses and non-U.S. tax credits, to the extent that realizing these benefits is considered in its judgment to be more likely than not. The Company regularly reviews the recoverability of its deferred tax assets considering its historic profitability, projected future taxable income, timing of the reversals of existing temporary differences and the feasibility of its tax planning strategies. Where appropriate, the Company records a valuation allowance with respect to a future tax benefit.

Effective January 1, 2007, the Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement 109” (FIN 48), which prescribes a recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return. Additionally, FIN 48 provides guidance on the recognition, classification, accounting in interim periods and disclosure requirements for uncertain tax positions. As a result of adopting FIN 48, the Company recorded additional liabilities to its previously established reserves, and a corresponding decrease in retained earnings of $145.6 million. Total unrecognized tax benefits as of December 31, 2008 and December 31, 2007 were $589.6 million and $379.8 million, respectively. The increase is primarily related to the inclusion of unrecognized tax positions attributable to the Trane business.

The provision for income taxes involves a significant amount of management judgment regarding interpretation of relevant facts and laws in the jurisdictions in which the Company operates. Future changes in applicable laws, projected levels of taxable income, and tax planning could change the effective tax rate and tax balances recorded by the Company. In addition, U.S. and non-U.S. tax authorities periodically review income tax returns filed by the Company and can raise issues regarding its filing positions, timing and amount of income or deductions, and the allocation of income among the jurisdictions in which the Company operates. A significant period of time may elapse between the filing of an income tax return and the ultimate resolution of an issue raised by a revenue authority with respect to that return. The Company believes that it has adequately provided for any reasonably foreseeable resolution of these matters. The Company will adjust its estimate if significant events so dictate. To the extent that the ultimate results differ from the original or adjusted estimates of the Company, the effect will be recorded in the provision for income taxes in the period that the matter is finally resolved.

•

Employee benefit plans – The Company provides a range of benefits to eligible employees and retired employees, including pensions, postretirement and postemployment benefits. Determining the cost associated with such benefits is dependent on various actuarial assumptions including

discount rates, expected return on plan assets, compensation increases, employee mortality and turnover rates and health-care cost trend rates. Actuarial valuations are performed to determine expense in accordance with generally accepted accounting principles in the United States. Actual results may differ from the actuarial assumptions and are generally accumulated and amortized into earnings over future periods. Effective December 31, 2006, these effects are generally recognized in shareholders’ equity on an annual basis, due to the adoption of SFAS 158. The Company reviews its actuarial assumptions at each measurement date and makes modifications to the assumptions based on current rates and trends, if appropriate. The discount rate, the rate of compensation increase and the expected long-term rates of return on plan assets are determined as of the measurement date. A discount rate reflects a rate at which pension benefits could be effectively settled. It is established and based primarily on a study based on the Citigroup Pension Liability index, and a review of the current yields reported by Moody’s on AA corporate bonds or the yields of high-quality fixed-income investments available and expected to be available during the life of the plans. The rate of compensation increase is dependent on expected future compensation levels. The expected long-term rate of return on plan assets reflects the average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the projected benefit obligation. The expected long-term rate of return on plan assets is based on what is achievable given the plan’s investment policy, the types of assets held and the target asset allocation. The expected long-term rate of return is determined as of the measurement date. The Company believes that the assumptions utilized in recording its obligations under its plans are reasonable based on input from its actuaries, outside investment advisors and information as to assumptions used by plan sponsors.

Changes in any of the assumptions can have an impact on the net periodic pension cost or postretirement benefit cost. Estimated sensitivities to the net periodic pension cost of a 0.25% rate decrease in the three basic assumptions are as follows: the discount rate would increase expense by approximately $7.6 million; the rate of compensation increase would decrease expense by approximately $4.4 million; and the estimated return on assets assumption would increase expense by approximately $5.8 million. A 0.25% rate decrease in the discount rate for postretirement benefits would increase net periodic postretirement benefit cost by $1.0 million and a 1.0% increase in the health-care cost trend rate would increase the cost by approximately $1.8 million.

The preparation of financial statements includes the use of estimates and assumptions that affect a number of amounts included in the Company’s consolidated financial statements. If actual amounts are ultimately different from previous estimates, the revisions are included in the Company’s results for the period in which the actual amounts become known. Historically, the aggregate differences, if any, between the Company’s estimates and actual amounts in any year have not had a material impact on the consolidated financial statements.

Recently Adopted Accounting Pronouncements:

Effective January 1, 2006, the Company adopted SFAS No. 123 (revised 2004), “Share-Based Payment,” (SFAS 123(R)) using the modified prospective method of adoption. SFAS 123(R) requires companies to recognize compensation expense for an amount equal to the fair value of the share-based payment issued. Under the modified prospective method, financial statement amounts for prior periods have not been restated to reflect the fair value method of recognizing compensation cost relating to stock options.

changes in the funded status within Accumulated other comprehensive income, net of tax, to the extent such changes are not recognized in earnings as components of periodic net benefit cost.

SFAS 158 also requires an entity to measure its defined benefit plan assets and benefit obligations as of the date of the employer’s fiscal year-end statement of financial position. The measurement date provisions of SFAS 158 are effective for the Company for the fiscal year ending December 31, 2008. The Company has adopted the measurement provisions of SFAS 158, which resulted in an after-tax charge to Retained earnings in the amount of $3.7 million ($6.5 million pre-tax) in 2008.

In September 2006, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (SAB 108). SAB 108 provides interpretive guidance on how the effects of the carryover or reversal of prior year misstatements should be considered in quantifying a current year misstatement. The SEC staff believes that registrants should quantify errors using both a balance sheet and an income statement approach and evaluate whether either approach results in quantifying a misstatement that, when all relevant quantitative and qualitative factors are considered, is material. SAB 108 is effective for the Company for the fiscal year ended December 31, 2006. SAB 108 did not have a material impact on the Company’s financial statements.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (SFAS 157). SFAS 157 establishes a framework for measuring fair value that is based on the assumptions market participants would use when pricing an asset or liability and establishes a fair value hierarchy that prioritizes the information to develop those assumptions. Additionally, the standard expands the disclosures about fair value measurements to include disclosing the fair value measurements of assets or liabilities within each level of the fair value hierarchy. SFAS 157 is effective for the Company starting on January 1, 2008. Refer to Note 23 in the consolidated financial statements for a full discussion on SFAS 157.

Effective February 12, 2008, the Company adopted FASB Staff Position (FSP) No. 157-2, “Effective Date of FASB Statement No. 157” (FSP SFAS 157-2). This FSP delays the effective date of SFAS 157 for nonfinancial assets and liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Due to the deferral, the Company has delayed its implementation of SFAS 157 provisions on the fair value of goodwill, indefinite-lived intangible assets and nonfinancial long-lived assets and liabilities.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (SFAS 159). SFAS 159 permits companies the option, at specified election dates, to measure financial assets and liabilities at their current fair value, with the corresponding changes in fair value from period to period recognized in the income statement. Additionally, SFAS 159 establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar assets and liabilities. SFAS 159 is effective for the Company starting on January 1, 2008. As of December 31, 2008, the Company has not elected the option available under SFAS 159.

Recently Issued Accounting Pronouncements:

In December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business Combinations,” (SFAS 141 (R)). This statement addresses financial accounting and reporting for business combinations and supersedes SFAS 141, “Business Combinations.” SFAS 141(R) retains the fundamental requirements set forth in SFAS 141 regarding the purchase method of accounting, but expands the guidance in order to properly recognize and measure, at fair value, the identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquired business. In addition, the statement introduces new accounting guidance on how to recognize and measure contingent consideration, contingencies, acquisition and restructuring costs. SFAS 141(R) is effective for acquisitions occurring after January 1, 2009.

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No 51.” It clarifies that a noncontrolling interest in a subsidiary represents an ownership interest that should be reported as equity in the consolidated financial statements. In addition, the statement requires expanded income statement presentation and disclosures that clearly identify and distinguish between the interests of the Company and the interests of the non-controlling owners of the subsidiary. SFAS 160 is effective for the Company starting on January 1, 2009. The Company is currently evaluating the impact of adopting SFAS 160 on its financial statements; however, the Company does not expect the impact to the consolidated financial statements to be material.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of SFAS No. 133. This statement amends and expands the disclosure requirements of SFAS 133, “Accounting for Derivative Instruments and Hedging Activities.” It requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of gains and losses on derivative instruments and disclosures about credit-risk-related contingent features in derivative agreements. SFAS 161 is effective for the Company starting on January 1, 2009. The Company is currently evaluating the impact of adopting SFAS 161 on its financial statements; however, the Company does not expect the impact to the consolidated financial statements to be material.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles” (SFAS 162). SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This pronouncement did not have a material impact on its financial statements.

In November 2008, the SEC issued for comment a proposed roadmap for the potential use by U.S. issuers of financial statements prepared in accordance with International Financial Reporting Standards (IFRS). IFRS is a comprehensive series of accounting standards published by the International Accounting Standards Board (IASB). Under the proposed roadmap, we could be required, in 2014, to prepare financial statements in accordance with IFRS. The SEC will make a determination in 2011 regarding the mandatory adoption of IFRS. We are currently assessing the impact that this potential change would have on our consolidated financial statements, and we will continue to monitor the development of the potential implementation of IFRS.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are exposed to fluctuations in non-U.S. currency exchange rates, interest rates and commodity prices which could impact our results of operations and financial condition. To manage certain of those exposures, we use derivative instruments, primarily forward contracts. Derivative instruments utilized by us in our hedging activities are viewed as risk management tools, involve little complexity and are not used for trading or speculative purposes. To minimize the risk of counter party non-performance, derivative instrument agreements are made only through major financial institutions with significant experience in such derivative instruments.

Foreign Currency Exposures

We have operations throughout the world that manufacture and sell their products in various international markets. As a result, we are exposed to movements in exchange rates of various currencies against the U.S. dollar as well as against other currencies throughout the world. We actively manage the currency exposures that are associated with non-U.S. currency purchases and sales and other assets and liabilities at the operating unit level. Exposures that cannot be naturally offset within an operating unit to an insignificant amount are hedged with foreign currency derivatives. We also have non-U.S. currency net asset exposures, which we currently do not hedge with any derivative instrument.

We evaluate our exposure to changes in currency exchange rates using a sensitivity analysis. The sensitivity analysis is a measurement of the potential gain or loss in fair value based on a percentage increase or decrease in exchange rates against the U.S. dollar. Based on the firmly committed currency derivative instruments in place at December 31, 2008, a hypothetical change in fair value of those derivative instruments assuming a 10% increase in exchange rates against the U.S. dollar would result in an unrealized gain of approximately $23.9 million, as compared with an unrealized gain of $17.2 million at December 31, 2007. These amounts would be offset by changes in the fair value of the underlying currency transactions.

As a result of the Trane acquisition we are exposed to exchange rate cash flow risks related to interest payments on debt that is denominated in Pound Sterling. We evaluate our exposure to changes in the Pound Sterling using a sensitivity analysis. Based on the cross currency swap in place at December 31, 2008, a hypothetical change in fair value of the swap assuming a 10% increase in exchange rates against the US Dollar would result in an unrealized gain of approximately $9.3 million. These amounts would be offset by changes in the fair value of the underlying debt transaction.

Commodity Price Exposures

We are exposed to volatility in the prices of raw materials used in some of our products and use both fixed price contracts and in limited circumstances, derivative contracts, to manage this exposure. We evaluate our exposure to changes in commodity prices using a sensitivity analysis. The sensitivity analysis is a measurement of the potential gain or loss in fair value based on a percentage increase or decrease in commodity prices. Based on the firmly committed commodity derivative instruments in place at December 31, 2008, a hypothetical change in fair value of those derivative instruments assuming a 10% decrease in commodity prices would result in a loss of approximately $1.0 million, as compared with an unrealized loss of $2.4 million at December 31, 2007. These amounts would be offset by changes in the fair value of underlying the commodity transactions.

Interest Rate Exposure

Our long-term debt portfolio mainly consists of fixed-rate instruments. However, we are active in the commercial paper markets. These markets, by their terms, have a maturity of less than a year. As such, we are exposed to interest rate risk. In addition, we have borrowings up to $754 million as of December 31, 2008 under our senior unsecured bridge loan facility. The borrowing cost is LIBOR plus a spread. As LIBOR fluctuates, our cost for the borrowing under the facility will also fluctuate.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

(a)	The following consolidated financial statements and the report thereon of PricewaterhouseCoopers LLP dated February 27, 2009, are presented following Item 15 of this Annual Report on Form 10-K.

Consolidated Financial Statements:

Report of independent registered public accounting firm

Consolidated statements of income for the years ended December 31, 2008, 2007 and 2006

Consolidated balance sheets at December 31, 2008 and 2007

For the years ended December 31, 2008, 2007 and 2006:

Consolidated statements of shareholders’ equity

Consolidated statements of cash flows

Notes to consolidated financial statements

Financial Statement Schedule:

Consolidated schedule for the years ended December 31, 2008, 2007 and 2006:

Schedule II – Valuation and Qualifying Accounts

(b)	The unaudited quarterly financial data for the two years ended December 31, is as follows:


In millions, except per share amounts		2008
		First Quarter			Second Quarter			Third Quarter			Fourth Quarter

Net revenues	$	2,163.3		$	3,080.8		$	4,313.2		$	3,670.0
Cost of goods sold		(1,540.9	)		(2,196.1	)		(3,209.4	)		(2,801.6	)
Operating income (loss)		247.0			361.6			347.4			(3,529.8	)
Net earnings (loss)		181.6			256.1			227.7			(3,290.2	)
Earnings (loss) per common share:
Basic	$	0.66		$	0.89		$	0.71		$	(10.27	)
Diluted	$	0.66		$	0.88		$	0.70		$	(10.27	)
		2007
		First Quarter			Second Quarter			Third Quarter			Fourth Quarter

Net revenues	$	1,976.2		$	2,224.6		$	2,239.0		$	2,323.3
Cost of goods sold		(1,416.0	)		(1,589.7	)		(1,608.2	)		(1,658.1	)
Operating income		208.6			274.1			276.3			298.8
Net earnings		217.5			964.1			266.6			2,518.5
Earnings per common share:
Basic	$	0.71		$	3.21		$	0.94		$	9.23
Diluted	$	0.70		$	3.17		$	0.92		$	9.06

1.	In the second quarter of 2007, basic and diluted earnings per common share included $2.25 and $2.22, respectively, related to the gain on sale of discontinued operations.

In the fourth quarter of 2007, basic and diluted earnings per common share included $9.48 and $9.30, respectively, related to the gain on sale of discontinued operations. In addition, basic and diluted earnings per common share included a charge of $1.02 and $1.00, respectively relating to asbestos matters for a previously divested business of the Company.

3.	2008 amounts include the results of Trane since the acquisition date (June 5, 2008 through December 31, 2008).

4.	The fourth quarter of 2008 includes a one-time, non-cash charge of $3,710.0 million ($3,385.0 after-tax) related to the impairment of assets.

Item 9. CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT ACCOUNTANTS

ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

Item 9A CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company’s management, including its Chief Executive Officer and Chief Financial Officer, have conducted an evaluation of the effectiveness of disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)), as of the end of the period covered by this Annual Report on Form 10-K. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded as of December 31, 2008, that the disclosure controls and procedures are effective in ensuring that all material information required to be filed in this Annual Report on Form 10-K has been recorded, processed, summarized and reported when required and the information is accumulated and communicated, as appropriate, to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined under Exchange Act Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

Management has assessed the effectiveness of internal control over financial reporting as of December 31, 2008. In making its assessment, management has utilized the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control – Integrated Framework. Management concluded that based on its assessment, the Company’s internal control over financial reporting was effective as of December 31, 2008.

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2008 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal controls over financial reporting during the quarter ended December 31, 2008 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Item 9B. OTHER INFORMATION

None.

PART III

The information called for by Part III (Items 10, 11, 12, and 13) of Form 10-K will be included in the Company’s Proxy Statement for the Company’s 2008 Annual General Meeting of Shareholders, which the Company intends to file within 120 days after the close of its fiscal year ended December 31, 2008 and is hereby incorporated by reference to such Proxy Statement, except that the information as to the Company’s executive officers which follows Item 4 in this Annual Report on Form 10-K, is incorporated by reference into Items 10 and 12, respectively, of this Report.

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item is incorporated herein by reference to the information contained under the caption “Audit and Non-Audit Fees” in our 2008 Proxy Statement.

PART IV

Item 15. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULE


(a) 1. and 2.		Financial statements and financial statement schedule See Item 8.

3.		Exhibits
		The exhibits listed on the accompanying index to exhibits are filed as part of this Annual Report on Form 10-K.

INGERSOLL-RAND COMPANY LIMITED

INDEX TO EXHIBITS

(Item 15(a))

Description

Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), Ingersoll-Rand Company Limited (the “Company”) has filed certain agreements as exhibits to this Annual Report on Form 10-K. These agreements may contain representations and warranties by the parties. These representations and warranties have been made solely for the benefit of the other party or parties to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were made only as of the date of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent developments, which may not be fully reflected in our public disclosure, (iii) may reflect the allocation of risk among the parties to such agreements and (iv) may apply materiality standards different from what may be viewed as material to investors. Accordingly, these representations and warranties may not describe our actual state of affairs at the date hereof and should not be relied upon.

(a) Exhibits


Exhibit No.	Description	Method of Filing

2.1	Agreement and Plan of Merger, dated as of October 31, 2001, among Ingersoll-Rand Company Limited, Ingersoll-Rand Company and IR Merger Corporation	Incorporated by reference to Annex I to the proxy statement/prospectus included as part of the Company’s Registration Statement on Form S-4 (File No. 333-71642) initially filed with the SEC on October 16, 2001 and subsequently amended on October 30, 2001.

2.2	Stock and Asset Purchase Agreement, dated as of October 16, 2002, between Ingersoll-Rand Company Limited, on behalf of itself and certain of its subsidiaries and The Timken Company, on behalf of itself and certain of its subsidiaries	Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on October 17, 2002.

2.3	Amendment to the Stock and Asset Purchase Agreement, dated as of February 18, 2003, amending the Stock Purchase Agreement, dated as of October 16, 2002, between Ingersoll-Rand Company Limited, on behalf of itself and certain of its subsidiaries and The Timken Company, on behalf of itself and certain of its subsidiaries	Incorporated by reference to Exhibit 2 to the Company’s Schedule 13D (File No. 005-10450) filed with the SEC on February 28, 2003.


2.4	Equity Purchase Agreement between FRC Acquisition LLC, on behalf of itself and the other buyers named therein, and Ingersoll-Rand Company Limited, on behalf of itself and the other sellers named therein, dated August 25, 2004, in connection with the divestiture of Dresser-Rand	Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on August 26, 2004.

2.5	Asset and Stock Purchase Agreement, dated as of February 27, 2007, among Ingersoll-Rand Company limited, on behalf of itself and the other sellers named therein, and AB Volvo (publ), on behalf of itself and the other buyers named therein	Incorporated by reference to Exhibit 2.01 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on February 28, 2007.

2.6	Asset and Stock Purchase Agreement, dated as of July 29, 2007, among Ingersoll-Rand Company Limited, on behalf of itself and certain of its subsidiaries, and Doosan Infracore Co., Ltd. and Doosan Engine Co., Ltd., on behalf of themselves and certain of their subsidiaries	Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on July 31, 2007.

2.7	Agreement and Plan of Merger, dated as of December 15, 2007, among the Company, Indian Merger Sub, Inc. and Trane Inc.	Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on December 17, 2007.

2.8	Separation and Distribution Agreement, dated as of July 16, 2007, by and between American Standard Companies Inc. and WABCO Holdings Inc.	Incorporated by reference to Exhibit 2.1 to Trane Inc.’s Form 8-K (File No. 001-11415) filed with the SEC on July 20, 2007.

3.1	Memorandum of Association of Ingersoll-Rand Company Limited	Incorporated by reference to Annex II to the proxy statement/prospectus included as part of the Company’s Registration Statement on Form S-4 (File No. 333-71642) initially filed with the SEC on October 16, 2001 and subsequently amended on October 30, 2001.

3.2	Amended and Restated Bye-Laws of Ingersoll-Rand Company Limited, dated June 4, 2008	Filed herewith.


4.1	Certificate of Designation, Preferences and Rights of Series A Preference Shares of Ingersoll-Rand Company Limited	Incorporated by reference to Exhibit 4.1 to the Company’s Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-71642) filed with the SEC on October 30, 2001.

4.2	Rights Agreement between Ingersoll-Rand Company Limited and The Bank of New York, as Rights Agent (expired in December 2008)	Incorporated by reference to Exhibit 4.2 to the Company’s Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-71642) filed with the SEC on October 30, 2001.

4.3	Voting Agreement between Ingersoll-Rand Company Limited and Ingersoll-Rand Company	Incorporated by reference to Exhibit 4.3 to the Company’s Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-71642) filed with the SEC on October 30, 2001.

4.4	Indenture, dated as of August 12, 2008, among the Company, Ingersoll-Rand Global Holding Company Limited and Wells Fargo Bank, N.A., as Trustee (replacing the Indenture originally filed as Exhibit 4.1 to the Company’s Form 10-Q (File No. 001-16831) for the period ended September 30, 2008 as filed with the SEC on 11/07/2008)	Filed herewith.

4.5	First Supplemental Indenture, dated as of August 15, 2008, among the Company, Ingersoll-Rand Global Holding Company Limited and Wells Fargo Bank, N.A., as Trustee, to the Indenture	Incorporated by reference to Exhibit 1.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on August 18, 2008.

4.6	Form of 6.0% Senior Notes due 2013	Included as part of Exhibit 4.2.

4.7	Form of Guarantee to 6.0% Senior Notes due 2013	Included as part of Exhibit 4.2.

4.8	Form of 6.875% Senior Notes due 2018	Included as part of Exhibit 4.2.

4.9	Form of Guarantee to 6.875% Senior Notes due 2018	Included as part of Exhibit 4.2.

4.10	Form of Senior Floating Rate Notes due 2010	Included as part of Exhibit 4.2.

4.11	Form of Guarantee to Senior Floating Rate Notes due 2010	Included as part of Exhibit 4.2.


4.12	The Company and its subsidiaries are parties to several long-term debt instruments under which in each case the total amount of securities authorized does not exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis.	Pursuant to paragraph 4(iii) of Item 601(b) of Regulation S-K, the Company agrees to furnish a copy of such instruments to the SEC upon request.

10.1	Issuing and Paying Agency Agreement among Ingersoll-Rand Global Holding Company Limited, Ingersoll-Rand Company Limited and JPMorgan Chase Bank, National Association, dated as of May 22, 2008	Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on May 29, 2008.

10.2	Commercial Paper Dealer Agreement among Ingersoll-Rand Global Holding Company Limited, Ingersoll-Rand Company Limited and J.P. Morgan Securities Inc., dated as of May 22, 2008	Incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on May 29, 2008.

10.3	Commercial Paper Dealer Agreement among Ingersoll-Rand Global Holding Company Limited, Ingersoll-Rand Company Limited and Banc of America Securities LLC, dated as of May 22, 2008	Incorporated by reference to Exhibit 10.3 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on May 29, 2008.

10.4	Commercial Paper Dealer Agreement among Ingersoll-Rand Global Holding Company Limited, Ingersoll-Rand Company Limited and Citigroup Global Markets Inc., dated as of May 22, 2008	Incorporated by reference to Exhibit 10.4 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on May 29, 2008.

10.5	Commercial Paper Dealer Agreement among Ingersoll-Rand Global Holding Company Limited, Ingersoll-Rand Company Limited and Deutsche Bank Securities Inc., dated as of May 22, 2008	Incorporated by reference to Exhibit 10.5 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on May 29, 2008.

10.6	Credit Agreement, dated as of June 25, 2004, among Ingersoll-Rand Company and Ingersoll-Rand Company Limited, the banks listed therein, The JPMorgan Chase Bank, as Administrative Agent, Citibank N.A., and Deutsche Bank Securities Inc., as Co-Syndication Agents, and The Bank of Tokyo-Mitsubishi, Ltd, as Documentation Agent, and J.P. Morgan Securities Inc., as Lead Arranger and Bookrunner	Incorporated by reference to Exhibit 4.8 to the Company’s Form 10-K for the fiscal year ended December 31, 2004 (File No. 001-16831) filed with the SEC on March 16, 2005.


10.7	Credit Agreement dated as of August 12, 2005, among Ingersoll-Rand Company and Ingersoll-Rand Company Limited, the banks listed therein, and Citicorp USA, Inc., as Syndication Agent, and Bank of America, N.A., Deutsche Bank Securities Inc., The Bank of Tokyo-Mitsubishi, Ltd., New York Branch and UBS Securities LLC, as Documentation Agents, and JPMorgan Chase Bank, N.A., as Administrative Agent, and J.P. Morgan Securities Inc. and Citigroup Global Markets Inc., as Lead Arrangers and Bookrunners	Incorporated by reference to Exhibit 4.6 to the Company’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-16831) filed with the SEC on March 1, 2006.

10.8	Credit Agreement, dated as of June 5, 2008, among Ingersoll-Rand Company Limited; Ingersoll-Rand Global Holding Company Limited; JPMorgan Chase Bank, N.A., as administrative agent; Credit Suisse Securities (USA) LLC and Goldman Sachs Credit Partners L.P., as syndication agents; J.P. Morgan Securities Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs Credit Partners L.P., as joint lead arrangers and joint bookrunners; and the lending institutions from time to time parties thereto	Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on June 5, 2008.

10.9	Credit Agreement, dated as of June 27, 2008, among Ingersoll-Rand Company Limited; Ingersoll-Rand Global Holding Company Limited; J.P. Morgan Chase Bank, N.A., as Administrative Agent, Citibank, N.A., as Syndication Agent, Bank of America, N.A., Deutsche Bank Securities Inc., The Bank of Tokyo Mitsubishi, Ltd., New York Branch, BNP Paribas and William Street LLC, as Documentation Agents, and J.P. Morgan Securities Inc. and Citigroup Global Markets Inc., as joint lead arrangers and joint bookrunners; and certain lending institutions from time to time parties thereto	Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on June 30, 2008.

10.10	Steven R. Shawley Offer Letter, dated June 5, 2008	Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on June 10, 2008.


10.11	Addendum to Steven R. Shawley Offer Letter, dated August 7, 2008	Incorporated by reference to Exhibit 10.9 to the Company’s Form 10-Q for the period ended June 30, 2008 (File No. 001-16831) filed with the SEC on August 8, 2008.

10.12	David R. Pannier Offer Letter, dated April 7, 2008	Incorporated by reference to Exhibit 10.3 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on June 10, 2008.

10.13	Didier Teirlinck Offer Letter, dated June 5, 2008	Incorporated by reference to Exhibit 10.4 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on June 10, 2008.

10.14	Addendum to Didier Teirlinck Offer Letter, dated July 17, 2008	Incorporated by reference to Exhibit 10.13 to the Company’s Form 10-Q for the period ended June 30, 2008 (File No. 001-16831) filed with the SEC on August 8, 2008.

10.15	Steven B. Hochhauser Offer Letter, dated June 6, 2008 (as revised on June 10, 2008)	Incorporated by reference to Exhibit 10.14 to the Company’s Form 10-Q for the period ended June 30, 2008 (File No. 001-16831) filed with the SEC on August 8, 2008.

10.16	Richard J. Weller Offer Letter dated September 8, 2008	Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on September 10, 2008.

10.17	Management Incentive Unit Plan of Ingersoll-Rand Company. Amendment to the Management Incentive Unit Plan, effective January 1, 1982. Amendment to the Management Incentive Unit Plan, effective January 1, 1987. Amendment to the Management Incentive Unit Plan, effective June 3, 1987	Incorporated by reference to Ingersoll-Rand Company’s Form 10-K for the fiscal year ended December 31, 1993 (File No. 1-985) filed with the SEC on March 30, 1994.

10.18	Reorganization Amendment to Management Incentive Unit Plan dated December 31, 2001	Incorporated by reference to Exhibit 10.2 to the Company’s Form 10-K for the fiscal year ended December 31, 2001 (File No. 001-16831) filed with the SEC on March 31, 2002.


10.19	Amendment to the Ingersoll-Rand Company Management Incentive Unit Plan dated December 22, 2008	Filed herewith.

10.20	Description of Annual Incentive Arrangements for Chairman, President, Sector Presidents and other Staff Officers of Ingersoll-Rand Company Limited	Incorporated by reference to Exhibit 10.10 to the Company’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-16831) filed with the SEC on March 1, 2006.

10.21	Description of Performance Share Program for Chairman, President and Chief Executive Officer and the other Participants of Ingersoll-Rand Company Limited	Incorporated by reference to Exhibit 10.4 to the Company’s Form 10-K for the fiscal year ended December 31, 2007 (File No. 001-16831) filed with the SEC on February 29, 2008.

10.22	Form of Change in Control Agreement with Tier 1 Officers of Ingersoll-Rand Company Limited, dated as of December 1, 2006	Incorporated by reference to Exhibit 99.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on December 4, 2006.

10.23	Form of Change in Control Agreement with Tier 2 Officers of Ingersoll-Rand Company Limited, dated as of December 1, 2006	Incorporated by reference to Exhibit 99.2 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on December 4, 2006.

10.24	Executive Supplementary Retirement Agreement for selected executive officers of Ingersoll- Rand Company	Incorporated by reference to Ingersoll-Rand Company’s Form 10-K for the fiscal year ended December 31, 1993 (File No. 1-985) filed with the SEC on March 30, 1994.

10.25	Executive Supplementary Retirement Agreement for selected executive officers of Ingersoll- Rand Company	Incorporated by reference to Ingersoll-Rand Company’s Form 10-K for the fiscal year ended December 31, 1996 (File No. 1-985) filed with the SEC on March 26, 1997.

10.26	Amendment to Executive Supplementary Retirement Agreement dated December 22, 2008	Filed herewith.


10.27	Forms of insurance and related letter agreements with certain executive officers of Ingersoll-Rand Company	Incorporated by reference to Ingersoll-Rand Company’s Form 10-K for the fiscal year ended December 31, 1993 (File No. 1-985) filed with the SEC on March 30, 1994.

10.28	Ingersoll-Rand Company Supplemental Pension Plan (Amended and Restated Effective January 1, 2005)	Filed herewith.

10.29	Ingersoll-Rand Company Supplemental Pension Plan II (Effective January 1, 2005)	Filed herewith.

10.30	Ingersoll-Rand Company Supplemental Employee Savings Plan (Amended and Restated Effective January 1, 2009)	Filed herewith.

10.31	Ingersoll-Rand Company Supplemental Employee Savings Plan II (Effective January 1, 2005 and Amended and Restated through January 1, 2009)	Filed herewith.

10.32	Incentive Stock Plan of 1995 (as amended)	Incorporated by reference to Exhibit 4.7 to the Company’s Registration Statement on Form S-8 (File No. 333-130047) filed with the SEC on December 1, 2005.

10.33	Senior Executive Performance Plan	Incorporated by reference to Appendix A to Ingersoll-Rand Company’s Notice of 2000 Annual Meeting of Shareholders and Proxy Statement of Ingersoll-Rand Company dated March 7, 2000.

10.34	Amended and Restated Elected Officers Supplemental Plan, dated December 31, 2004	Incorporated by reference to Exhibit 10.24 to the Company’s Form 10-K for the fiscal year ended December 31, 2004 (File No. 001-16831) filed with the SEC on March 16, 2005.

10.35	Amendment, dated February 1, 2006, to Amended and Restated Elected Officers Supplemental Plan, dated December 31, 2004	Incorporated by reference to Exhibit 10.25 to the Company’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-16831) filed with the SEC on March 1, 2006.


10.36	Ingersoll-Rand Company Elected Officers Supplemental Program II (Effective January 1, 2005 and Amended and Restated through January 1, 2009)	Filed herewith.

10.37	Herbert L. Henkel Letter, dated February 4, 2009, relating to his benefits under the Ingersoll-Rand Company Elected Officers Supplemental Program II	Filed herewith.

10.38	Amended and Restated Incentive Stock Plan of 1998	Incorporated by reference to Exhibit 4.9 to the Company’s Registration Statement on Form S-8 (File No. 333-130047) filed with the SEC on December 1, 2005.

10.39	Amendment to the Ingersoll-Rand Company Limited Amended and Restated Incentive Stock Plan of 1998, dated December 7, 2005	Incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on December 9, 2005.

10.40	Composite Employment Agreement with Chief Executive Officer	Incorporated by reference to Ingersoll-Rand Company’s Form 10-K for the fiscal year ended December 31, 1999 (File No. 1-985) filed with the SEC on March 30, 2000.

10.41	Employment Agreement with Michael Lamach, Senior Vice President	Incorporated by reference to Exhibit 10.35 to the Company’s Form 10-K for the fiscal year ended December 31, 2003 (File No. 001-16831) filed with the SEC on February 27, 2004.

10.42	Michael W. Lamach Addendum, dated June 4, 2008	Incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on 06/10/2008.

10.43	Michael W. Lamach Letter, dated February 4, 2009	Filed herewith.

10.44	Employment Agreement with James R. Bolch, Senior Vice President	Incorporated by reference to Exhibit 10.40 to the Company’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-16831) filed with the SEC on March 1, 2006.


10.45	Addendum, dated December 8, 2005, to Employment Agreement with James R. Bolch	Incorporated by reference to Exhibit 10.41 to the Company’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-16831) filed with the SEC on March 1, 2006.

10.46	Amended and Restated Estate Enhancement Program, dated June 1, 1998, and the related form agreements	Incorporated by reference to Exhibit 10.1 to the Company’s Form 10-Q for the period ended March 31, 2006 (File No. 001-16831) filed with the SEC on May 5, 2006.

10.47	First Amendment to the Amended and Restated Estate Enhancement Program, dated December 31, 2001	Incorporated by reference to Exhibit 10.2 to the Company’s Form 10-Q for the period ended March 31, 2006 (File No. 001-16831) filed with the SEC on May 5, 2006.

10.48	Employment Agreement with William Gauld, Senior Vice President, dated September 7, 2006	Incorporated by reference to Exhibit 10.44 to the Company’s Form 10-K for the fiscal year ended December 31, 2006 (File No. 001-16831) filed with the SEC on March 1, 2007.

10.49	Employment Agreement with Marcia J. Avedon, Senior Vice President, dated January 8, 2007	Incorporated by reference to Exhibit 10.45 to the Company’s Form 10-K for the fiscal year ended December 31, 2006 (File No. 001-16831) filed with the SEC on March 1, 2007.

10.50	Ingersoll-Rand Company Limited Incentive Stock Plan of 2007	Incorporated by reference to Exhibit 4.7 to the Company’s Registration Statement on Form S-8 (File No. 333-143716) filed with the SEC on June 13, 2007.

10.51	IR-Limited Director Deferred Compensation Plan and Stock Award Plan, as amended and restated effective January 1, 2009	Filed herewith.

10.52	IR-Limited Director Deferred Compensation Plan and Stock Award Plan II, as amended and restated effective January 1, 2009	Filed herewith.

10.53	IR Executive Deferred Compensation Plan, as amended and restated effective January 1, 2009	Filed herewith


10.54	Executive Deferred Compensation Plan II, as amended and restated effective January 1, 2009	Filed herewith.

10.55	Form of IR Stock Option Grant Agreement	Filed herewith.

10.56	Form of IR Restricted Share Unit Grant Agreement	Filed herewith.

10.57	Form of IR Performance Share Unit Grant Agreement (for performance years 2009-2010)	Filed herewith.

10.58	Form of IR Performance Share Unit Grant Agreement (for performance years 2009-2011)	Filed herewith.

10.59	Deferred Prosecution Agreement between Ingersoll-Rand Company Limited and the United States Department of Justice, Criminal Division, Fraud Section filed as of October 31, 2007	Incorporated by reference to Exhibit 99.2 to the Company’s Form 8-K (File No. 001-16831) filed with the SEC on November 1, 2007.

10.60	Trane Inc. 2002 Omnibus Incentive Plan	Incorporated by reference to Exhibit 4.1 to the Company’s Post-Effective Amendment No. 1 on Form S-8 to the Registration Statement on Form S-4 (File No. 333-149537) filed with the SEC on June 12, 2008.

10.61	Trane Inc. Stock Incentive Plan	Incorporated by reference to Exhibit 4.2 to the Company’s Post-Effective Amendment No. 1 on Form S-8 to the Registration Statement on Form S-4 (File No. 333-149537) filed with the SEC on June 12, 2008.

10.62	Trane Inc. Deferred Compensation Plan	Incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-8 (File No. 333-151607) filed with the SEC on June 12, 2008.

10.63	Trane Inc. Supplemental Savings Plan (restated to include all amendments through June 5, 2008)	Incorporated by reference to Exhibit 10.18 to the Company’s Form 10-Q for the period ended June 30, 2008 (File No. 001-16831) filed with the SEC on August 8, 2008.


10.64	Trane Inc. Executive Supplemental Retirement Benefit Program (restated to include all amendments through December 6, 2007)	Incorporated by reference to Exhibit 10.9 to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 2007 (File No. 001-11415) filed with the SEC on February 20, 2008.

10.65	Trane Inc. Corporate Officer Severance Plan (restated to include all amendments through December 6, 2007)	Incorporated by reference to Exhibit 10.12 to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 2007 (File No. 001-11415) filed with the SEC on February 20, 2008.

10.66	Addendum to Trane Inc. Stock Incentive Plan to comply with local regulations in the United Kingdom with respect to options granted in that country	Incorporated by reference to Exhibit (10)(xii) to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 1999 (File No. 001-11415) filed with the SEC on March 30, 2000.

10.67	Addendum to Trane Inc. Stock Incentive Plan revised to comply with local regulations in France with respect to options granted in that country	Incorporated by reference to Exhibit (10)(xiii) to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 1999 (File No. 001-11415) filed with the SEC on March 30, 2000.

10.68	Second Addendum for French Participants to Trane Inc. Stock Incentive Plan in governing options granted to participants in France on or after May 16, 2001	Incorporated by reference to Exhibit (10)(xix) to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 2002 (File No. 001-11415) filed with the SEC on March 14, 2003.

10.69	Addendum to Trane Inc. Stock Incentive Plan for Canadian participants to comply with local regulation in Canada with respect to options granted in that country	Incorporated by reference to Exhibit 10.2 to Trane Inc.’s Form 10-Q for the period ended June 30, 2004 (File No. 001-11415) filed with the SEC on July 29, 2004.

10.70	Form of Trane Stock Option Agreement for U.S. Employees	Incorporated by reference to Exhibit 10.39 to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-11415) filed with the SEC on February 24, 2006.

10.71	Form of Trane Stock Option Agreement for Non-U.S. Employees	Incorporated by reference to Exhibit 10.40 to Trane Inc.’s Form 10-K for the fiscal year ended December 31, 2005 (File No. 001-11415) filed with the SEC on February 24, 2006.


10.72	Tax Sharing Agreement, dated as of July 16, 2007, by and among American Standard Companies Inc. and certain of its subsidiaries and WABCO Holdings Inc. and certain of its subsidiaries	Incorporated by reference to Exhibit 10.1 to Trane Inc.’s Form 8-K (File No. 001-11415) filed with the SEC on July 20, 2007.

10.73	Transition Services Agreement, dated as of July 16, 2007, by and between American Standard Companies Inc. and WABCO Holdings Inc.	Incorporated by reference to Exhibit 10.2 to Trane Inc.’s Form 8-K (File No. 001-11415) filed with the SEC on July 20, 2007.

10.74	Employee Matters Agreement, dated as of July 16, 2007, by and between American Standard Companies Inc. and WABCO Holdings Inc.	Incorporated by reference to Exhibit 10.3 to Trane Inc.’s Form 8-K (File No. 001-11415) filed with the SEC on July 20, 2007.

10.75	Indemnification and Cooperation Agreement, dated as of July 16, 2007, by and among American Standard Companies Inc. and certain of its subsidiaries and WABCO Holdings Inc. and certain of its subsidiaries	Incorporated by reference to Exhibit 10.4 to Trane Inc.’s Form 8-K (File No. 001-11415) filed with the SEC on July 20, 2007.

12	Computations of Ratios of Earnings to Fixed Charges	Filed herewith.

21	List of Subsidiaries of Ingersoll-Rand Company Limited	Filed herewith.

23.1	Consent of Independent Registered Public Accounting Firm	Filed herewith.

23.2	Consent of Analysis, Research & Planning Corporation	Filed herewith.

31.1	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith.

31.2	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith.

32	Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

INGERSOLL-RAND COMPANY LIMITED

(Registrant)


By:		/S/ Herbert L. Henkel
		(Herbert L. Henkel) Chief Executive Officer
Date:		February 27, 2009

Pursuant to the requirement of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


Signature	Title	Date

/S/ Herbert L. Henkel (Herbert L. Henkel)	Chairman, President, Chief Executive Officer and Director (Principal Executive Officer)	February 27, 2009

/S/ Steven R. Shawley (Steven R. Shawley)	Senior Vice President and Chief Financial Officer (Principal Financial Officer)	February 27, 2009

/S/ Richard J. Weller (Richard J. Weller)	Vice President and Controller (Principal Accounting Officer)	February 27, 2009

/S/ Ann C. Berzin (Ann C. Berzin)	Director	February 27, 2009

/S/ Jared L. Cohon (Jared L Cohon)	Director	February 27, 2009

/S/ Gary D. Forsee (Gary D. Forsee)	Director	February 27, 2009

/S/ Peter C. Godsoe (Peter C. Godsoe)	Director	February 27, 2009

/S/ Edward E. Hagenlocker (Edward E. Hagenlocker)	Director	February 27, 2009

/S/ Constance Horner (Constance Horner)	Director	February 27, 2009

/S/ H. William Lichtenberger (H. William Lichtenberger)	Director	February 27, 2009

/S/ Theodore E. Martin (Theodore E. Martin)	Director	February 27, 2009

/S/ Patricia Nachtigal (Patricia Nachtigal)	Director	February 27, 2009

/S/ Orin R. Smith (Orin R. Smith)	Director	February 27, 2009

/S/ Richard J. Swift (Richard J. Swift)	Director	February 27, 2009

/S/ Tony L. White (Tony L. White)	Director	February 27, 2009

INGERSOLL-RAND COMPANY LIMITED

Index to Consolidated Financial Statements


		Page
Report of Independent Registered Public Accounting Firm		F-1

Consolidated Statements of Income		F-3

Consolidated Balance Sheets		F-4

Consolidated Statements of Shareholders’ Equity		F-5

Consolidated Statements of Cash Flows		F-6

Notes to Consolidated Financial Statements		F-7

Schedule II - Valuation and Qualifying Accounts		F-64

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Ingersoll-Rand Company Limited:

In our opinion, the consolidated financial statements listed in the index appearing under Item 15 (a)(1) present fairly, in all material respects, the financial position of Ingersoll-Rand Company Limited and its subsidiaries at December 31, 2008 and 2007, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2008 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the index appearing under Item 15 (a)(2), presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements and financial statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

As discussed in Note 2 to the consolidated financial statements, the Company has changed the manner in which it accounts for uncertainty in income taxes effective January 1, 2007, and the manner in which it accounts for its defined benefit pension and other postretirement plans in 2006 and 2008.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

F-1

/s/ PricewaterhouseCoopers LLP

Florham Park, New Jersey

February 27, 2009

F-2

Ingersoll-Rand Company Limited

Consolidated Statements of Income

In millions, except per share amounts


For the years ended December 31,	2008			2007			2006
Net revenues	$	13,227.4		$	8,763.1		$	8,033.7
Cost of goods sold		(9,748.1	)		(6,272.0	)		(5,768.4	)
Selling and administrative expenses		(2,343.1	)		(1,433.3	)		(1,266.8	)
Asset impairment		(3,710.0	)		-			-
Operating income (loss)		(2,573.8	)		1,057.8			998.5
Interest expense		(245.4	)		(136.2	)		(133.6	)
Other, net		43.2			15.9			(7.3	)
Earnings (loss) before income taxes		(2,776.0	)		937.5			857.6
(Provision) benefit for income taxes		208.6			(204.4	)		(92.6	)
Earnings (loss) from continuing operations		(2,567.4	)		733.1			765.0
Discontinued operations, net of tax		(57.4	)		3,233.6			267.5
Net earnings (loss)	$	(2,624.8	)	$	3,966.7		$	1,032.5

Basic earnings (loss) per common share:
Continuing operations	$	(8.54	)	$	2.52		$	2.39
Discontinued operations		(0.19	)		11.12			0.84
Net earnings (loss)	$	(8.73	)	$	13.64		$	3.23

Diluted earnings (loss) per common share:
Continuing operations	$	(8.54	)	$	2.48		$	2.37
Discontinued operations		(0.19	)		10.95			0.83
Net earnings (loss)	$	(8.73	)	$	13.43		$	3.20

See accompanying notes to consolidated financial statements.

F-3

Ingersoll-Rand Company Limited

Consolidated Balance Sheets

In millions, except share amounts


December 31,	2008			2007
ASSETS
Current assets:
Cash and cash equivalents	$	550.2		$	4,735.3
Accounts and notes receivable, net		2,428.5			1,660.7
Inventories		1,615.1			827.2
Other current assets		805.9			477.5
Total current assets		5,399.7			7,700.7

Property, plant and equipment, net		1,968.5			904.9
Goodwill		6,620.1			3,993.3
Intangible assets, net		5,214.1			724.6
Other noncurrent assets		1,722.1			1,052.7
Total assets	$	20,924.5		$	14,376.2
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	1,046.5		$	721.2
Accrued compensation and benefits		508.8			338.9
Accrued expenses and other current liabilities		1,605.7			1,434.6
Short-term borrowings and current maturities of long-term debt		2,350.4			741.0
Total current liabilities		5,511.4			3,235.7

Long-term debt		2,773.7			712.7
Postemployment and other benefit liabilities		1,865.5			941.9
Deferred income taxes		2,184.8			539.9
Other noncurrent liabilities		1,827.0			940.6
Minority interests		100.7			97.5

Shareholders’ equity:
Class A common shares, $1 par value (370,813,037 and 370,035,087 shares issued at December 31, 2008 and 2007, respectively, and net of 52,020,439 and 97,421,234 shares owned by subsidiary at December 31, 2008 and 2007, respectively)		318.8			272.6
Capital in excess of par value		2,246.0			-
Retained earnings		4,547.4			7,388.8
Accumulated other comprehensive income (loss)		(450.8	)		246.5
Total shareholders’ equity		6,661.4			7,907.9
Total liabilities and shareholders’ equity	$	20,924.5		$	14,376.2

See accompanying notes to consolidated financial statements.

F-4

Ingersoll-Rand Company Limited

Consolidated Statements of Shareholders’ Equity


	Total shareholders’ equity			Common stock					Capital in excess of par value			Retained earnings			Accumulated other comprehensive income (loss)			Comprehensive income
In millions, except per share amounts	Total shareholders’ equity			Amount			Shares		Capital in excess of par value			Retained earnings			Accumulated other comprehensive income (loss)			Comprehensive income

Balance at December 31, 2005	$	5,761.9		$	330.7		330.7		$	-		$	5,558.8		$	(127.6	)
Net earnings		1,032.5			-		-			-			1,032.5			-		$	1,032.5
Currency translation		258.8			-		-			-			-			258.8			258.8
Change in value of marketable securities and derivatives qualifying as cash flow hedges, net of tax of $0.8		(7.3	)		-		-			-			-			(7.3	)		(7.3	)
Minimum pension liability adjustment, net of tax of $3.2		(9.2	)		-		-			-			-			(9.2	)		(9.2	)
Total comprehensive income																		$	1,274.8
Adoption of FASB Statement No. 158, net of tax of $268.2		(472.8	)		-		-			-			-			(472.8	)
Shares issued under incentive stock plans		111.2			3.8		3.8			107.4			-			-
Repurchase of common shares by subsidiary		(1,096.3	)		(27.7	)	(27.7	)		(151.0	)		(917.6	)		-
Share-based compensation		43.6			-		-			43.6			-			-
Cash dividends, declared and paid ($0.68 per share)		(217.6	)		-		-			-			(217.6	)		-
Balance at December 31, 2006		5,404.8			306.8		306.8			-			5,456.1			(358.1	)
Adoption of FIN 48		(145.6	)		-		-			-			(145.6	)		-
Net earnings		3,966.7			-		-			-			3,966.7			-		$	3,966.7
Currency translation		411.9			-		-			-			-			411.9			411.9
Change in value of marketable securities and derivatives qualifying as cash flow hedges, net of tax of $1.7		(2.2	)		-		-			-			-			(2.2	)		(2.2	)
Pension and OPEB adjustments, net of tax of $130.0		194.9			-		-			-			-			194.9			194.9
Total comprehensive income																		$	4,571.3
Shares issued under incentive stock plans		196.6			5.5		5.5			191.1			-			-
Repurchase of common shares by subsidiary		(1,999.9	)		(39.7	)	(39.7	)		(281.6	)		(1,678.6	)		-
Share-based compensation		90.5			-		-			90.5			-			-
Cash dividends, declared and paid ($0.72 per share)		(209.8	)		-		-			-			(209.8	)		-
Balance at December 31, 2007		7,907.9			272.6		272.6			-			7,388.8			246.5
Net loss		(2,624.8	)		-		-			-			(2,624.8	)		-		$	(2,624.8	)
Currency translation		(238.8	)		-		-			-			-			(238.8	)		(238.8	)
Change in value of marketable securities and derivatives qualifying as cash flow hedges, net of tax of $2.7		3.5			-		-			-			-			3.5			3.5
Pension and OPEB adjustments, net of tax of $254.8		(463.3	)		-		-			-			-			(463.3	)		(463.3	)
Total comprehensive income																		$	(3,323.4	)
Effects of measurement date change pursuant to FASB Statement No. 158 service cost, interest cost and expected return on plan assets for December 1 - December 31, 2007, net of tax of $1.4		(2.4	)		-		-			-			(2.4	)		-
Amortization of net transition obligation, prior service cost and net actuarial losses for December 1 - December 31, 2007, net of tax of $1.4		-			-		-			-			(1.3	)		1.3
Shares issued under incentive stock plans		32.0			0.8		0.8			31.2			-			-
Repurchase of common shares by subsidiary		(2.0	)		-		-			(2.0	)		-			-
Treasury shares issued as Trane merger consideration		2,035.1			45.4		45.4			1,989.7			-			-
Conversion of Trane options to IR options		184.0			-		-			184.0			-			-
Share-based compensation		43.1			-		-			43.1			-			-
Cash dividends, declared and paid ($0.72 per share)		(212.9	)		-		-			-			(212.9	)		-
Balance at December 31, 2008	$	6,661.4		$	318.8		318.8		$	2,246.0		$	4,547.4		$	(450.8	)

See accompanying notes to consolidated financial statements.

F-5

Ingersoll-Rand Company Limited

Consolidated Statements of Cash Flows

In millions


For the years ended December 31,	2008			2007			2006
Cash flows from operating activities:
Net earnings (loss)	$	(2,624.8	)	$	3,966.7		$	1,032.5
Loss (income) from discontinued operations, net of tax		57.4			(3,233.6	)		(267.5	)
Adjustments to arrive at net cash provided by (used in) operating activities:
Asset impairment charge		3,710.0			-			-
Depreciation and amortization		453.1			138.8			148.8
(Gain)/loss on sale of property, plant and equipment		(0.1	)		(0.7	)		0.2
Minority interests, net of dividends		2.5			17.9			9.2
Equity earnings, net of dividends		9.9			(1.0	)		0.1
Stock settled share based compensation		42.3			31.0			20.7
Deferred income taxes		(334.0	)		146.6			27.8
Other items		(35.8	)		30.6			(12.2	)
Changes in other assets and liabilities (Increase) decrease in:
Accounts and notes receivable		245.3			46.2			(94.4	)
Inventories		120.7			75.4			(21.4	)
Other current and noncurrent assets		119.9			(32.3	)		(93.6	)
Increase (decrease ) in:
Accounts payable		(208.5	)		(88.1	)		182.1
Other current and noncurrent liabilities		(1,201.1	)		(267.6	)		(119.2	)
Net cash (used in) provided by continuing operating activities		356.8			829.9			813.1
Net cash (used in) provided by discontinued operating activities		(25.9	)		66.2			141.7
Cash flows from investing activities:
Capital expenditures		(306.0	)		(119.7	)		(144.8	)
Proceeds from sale of property, plant and equipment		77.4			14.2			9.6
Acquisitions, net of cash acquired		(7,107.3	)		(25.7	)		(49.7	)
Proceeds from business dispositions, net of cash		52.9			6,154.3			-
Proceeds from sales and maturities of marketable securities		7.8			0.7			155.8
Other		(31.2	)		28.6			0.4
Net cash (used in ) provided by continuing investing activities		(7,306.4	)		6,052.4			(28.7	)
Net cash (used in) provided by discontinued investing activities		-			(57.7	)		(132.5	)
Cash flows from financing activities:
Proceeds from bridge loan		2,950.0			-			-
Payments of bridge loan		(2,196.0	)		-			-
Commercial paper program (net)		998.7			(378.0	)		378.0
Other short-term borrowings (net)		5.8			(31.9	)		(8.8	)
Proceeds from long-term debt		1,610.4			2.0			4.0
Payments of long-term debt		(384.5	)		(141.8	)		(513.7	)
Net proceeds (repayments) in debt		2,984.4			(549.7	)		(140.5	)
Debt issue costs		(23.0	)		-			-
Proceeds from exercise of stock options		18.5			160.2			95.7
Excess tax benefit from share based compensation		13.1			36.1			15.5
Dividends paid		(212.9	)		(209.8	)		(217.6	)
Repurchase of common shares by subsidiary		(2.0	)		(1,999.9	)		(1,096.3	)
Net cash (used in) provided by continuing financing activities		2,778.1			(2,563.1	)		(1,343.2	)
Net cash (used in ) provided by discontinued financing activities		-			-			-
Effect of exchange rate changes on cash and cash equivalents		12.3			51.8			29.4
Net increase (decrease) in cash and cash equivalents		(4,185.1	)		4,379.5			(520.2	)
Cash and cash equivalents - beginning of period		4,735.3			355.8			876.0
Cash and cash equivalents - end of period	$	550.2		$	4,735.3		$	355.8

Cash paid during the year for:
Interest, net of amounts capitalized	$	81.7		$	95.3		$	105.2
Income taxes, net of refunds	$	1,058.0		$	470.1		$	195.3

See accompanying notes to consolidated financial statements.

F-6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – DESCRIPTION OF COMPANY

Ingersoll-Rand Company Limited (IR-Limited), a Bermuda company, and its consolidated subsidiaries (the Company) is a diversified, global company that provides products, services and solutions to enhance the quality and comfort of air in homes and buildings, transport and protect food and perishables, secure homes and commercial properties, and increase industrial productivity and efficiency. The Company’s business segments consist of Air Conditioning Systems and Services, Climate Control Technologies, Industrial Technologies and Security Technologies, each with strong brands and leading positions within their respective markets. The Company generates revenue and cash primarily through the design, manufacture, sale and service of a diverse portfolio of industrial and commercial products that include well-recognized, premium brand names such as Club Car®, Hussmann®, Ingersoll-Rand®, Schlage®, Thermo King® and Trane®

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of significant accounting policies used in the preparation of the accompanying financial statements follows:

Basis of Presentation: As discussed in Note 3, the Company acquired Trane Inc. (Trane) at the close of business on June 5, 2008 (the Acquisition Date). As a result of the acquisition, the results of the operations of Trane have been included in the statement of financial position at December 31, 2008 and the consolidated statements of operations and cash flows since the Acquisition Date.

Certain reclassifications of amounts reported in prior years have been made to conform to the 2008 classification.

Reorganization: IR-Limited is the successor to Ingersoll-Rand Company, a New Jersey corporation (IR-New Jersey), following a corporate reorganization (the reorganization) that became effective on December 31, 2001. The reorganization was accomplished through a merger of a newly formed merger subsidiary of IR-Limited. IR-Limited and its subsidiaries continue to conduct the businesses previously conducted by IR-New Jersey and its subsidiaries. The reorganization has been accounted for as a reorganization of entities under common control and accordingly, did not result in any changes to the consolidated amounts of assets, liabilities and shareholders’ equity.

Principles of Consolidation: The consolidated financial statements include all majority-owned subsidiaries of the Company. Partially owned equity affiliates are accounted for under the equity method. The Company is also required to consolidate variable interest entities in which it bears a majority of the risk to the entities’ potential losses or stands to gain from a majority of the entities’ expected returns. Intercompany accounts and transactions have been eliminated. The assets, liabilities, results of operations and cash flows of all discontinued operations have been separately reported as discontinued operations and held for sale for all periods presented. Certain prior year amounts have been reclassified to conform to the current year presentation.

Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Estimates are based on several factors including the facts and circumstances available at the time the estimates are made, historical experience, risk of loss, general economic conditions and trends, and the assessment of the probable future outcome. Some of the more

F-7

significant estimates include accounting for doubtful accounts, useful lives of property, plant and equipment and intangible assets, purchase price allocations of acquired businesses, valuation of assets including goodwill and other intangible assets, product warranties, sales allowances, pension plans, postretirement benefits other than pensions, taxes, environmental costs, product liability, asbestos matters and other contingencies. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the statement of operations in the period that they are determined.

Currency Translation: Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates, and income and expenses accounts have been translated using average exchange rates throughout the year. Adjustments resulting from the process of translating an entity’s financial statements into the U.S. dollar have been recorded in the equity section of the balance sheet within Accumulated other comprehensive income (loss). Transactions that are denominated in a currency other than an entity’s functional currency are subject to changes in exchange rates with the resulting gains and losses recorded within net earnings.

Cash and Cash Equivalents: Cash and cash equivalents include cash on hand, demand deposits and all highly liquid investments with original maturities at the time of purchase of three months or less.

Marketable Securities: The Company has classified its marketable securities as available-for-sale in accordance with the guidance under Statement of Financial Accounting Standards (SFAS) No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” Available-for-sale marketable securities are accounted for at market prices, with the unrealized gain or loss, less applicable deferred income taxes, recorded within Accumulated other comprehensive income (loss). If any of the Company’s marketable securities experience other than temporary declines in value as defined by Emerging Issues Task Force (EITF) 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments,” a loss is recorded in the Consolidated Statement of Income.

Inventories: Depending on the business, U.S. inventories are stated at the lower of cost or market using the last-in, first-out (LIFO) method or the lower of cost or market using the first-in, first-out (FIFO) method. Non-U.S. inventories are primarily stated at the lower of cost or market using the FIFO method. At December 31, 2008 and 2007, approximately 45% and 20%, respectively, of all inventory utilized the LIFO method.

Allowance for Doubtful Accounts: The Company has provided an allowance for doubtful accounts reserve which represents the best estimate of probable loss inherent in the Company’s account receivables portfolio. This estimate is based upon company policy, derived from knowledge of its end markets, customer base and products. The Company reserved $51.2 million and $12.2 million for doubtful accounts as of December 31, 2008 and 2007, respectively.

Property, Plant and Equipment: Property, plant and equipment are stated at cost, less accumulated depreciation. Assets placed in service are recorded at cost and depreciated using the straight-line method over the estimated useful life of the asset except for leasehold improvements, which are depreciated over the shorter of their economic useful life or their lease term. The range of useful lives used to depreciate property, plant and equipment is as follows:


Buildings		10 to 50 years
Machinery and equipment		3 to 15 years
Software		2 to 7 years

F-8

Repair and maintenance costs that do not extend the useful life of the asset are charged against earnings as incurred. Major replacements and significant improvements that increase asset values and extend useful lives are capitalized.

The Company assesses the recoverability of the carrying value of its property, plant and equipment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to the future net undiscounted cash flows expected to be generated by the asset. If the undiscounted cash flows are less than the carrying amount of the asset, an impairment loss is recognized for the amount by which the carrying value of the asset exceeds the fair value of the assets.

Goodwill and Intangible Assets: The Company records as goodwill the excess of the purchase price over the fair value of the net assets acquired. Once the final valuation has been performed for each acquisition, adjustments may be recorded.

In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets,” goodwill and other intangible assets with indefinite lives are not amortized, but instead are tested for impairment at least annually or more frequently whenever events or changes in circumstances indicate that the fair value of the asset may be less than its carrying amount. The Company tests for impairment during the fourth quarter of its fiscal year.

Recoverability of goodwill is measured at the reporting unit level and determined using a two step process. The first step compares the carrying amount of the reporting unit to its estimated fair value. To the extent that the carrying value of the reporting unit exceeds its estimated fair value, a second step is performed, wherein the reporting unit’s carrying value of goodwill is compared to the implied fair value of goodwill. To the extent that the carrying value exceeds the fair value, impairment exists and must be recognized. Recoverability of other intangible assets with indefinite useful lives is measured by a comparison of the carrying amount of the intangible assets to the fair value of the respective intangible assets. Any excess of the carrying value over the fair value is recognized as an impairment loss.

Intangible assets such as patents, customer-related intangible assets and other intangible assets with finite useful lives are amortized on a straight-line basis over their estimated economic lives. The range of useful lives is as follows:


Customer relationships	20 years
Trademarks	25 years
Completed technology/patents	10 years
Other	10 years	*

*	Excludes the effect of intangibles acquired as a part of the acquisition of Trane and fully expensed in 2008

Recoverability of intangible assets with finite useful lives is assessed in the same manner as property, plant and equipment as described above.

Income Taxes: Deferred tax assets and liabilities are determined based on temporary differences between financial reporting and tax bases of assets and liabilities, applying enacted tax rates expected to be in effect for the year in which the differences are expected to reverse. The Company recognizes future tax benefits, such as net operating losses and non-U.S. tax credits, to the extent that realizing these benefits is considered in its judgment to be more likely than not. The Company regularly reviews the recoverability of its deferred tax assets considering its historic profitability, projected future taxable income, timing of the reversals of existing temporary differences and the feasibility of its tax planning strategies. Where appropriate, the Company records a valuation allowance with respect to a future tax benefit.

F-9

Product Warranties: Warranty accruals are recorded at the time of sale and are estimated based upon product warranty terms and historical experience. The Company assesses the adequacy of its liabilities and will make adjustments as necessary based on known or anticipated warranty claims, or as new information becomes available.

Treasury Stock: The Company, through one of its consolidated subsidiaries, repurchases IR-Limited’s Class A common shares from time to time in the open market and in privately negotiated transactions as authorized by the Board of Directors. These repurchases are based upon current market conditions and the discretion of management. Amounts are recorded at cost and included within the Shareholders’ equity section. For the year ended December 31, 2008 and 2007, Class A common shares owned by the Company amounted to 52.0 million and 97.4 million, respectively. The reduction from 2007 was a result of the issuance of 45.4 million IR-Limited Class A common shares to fund the equity portion of the consideration paid for the Trane acquisition.

Revenue Recognition: Revenue is recognized and earned when all of the following criteria are satisfied: (a) persuasive evidence of a sales arrangement exists; (b) price is fixed or determinable; (c) collectability is reasonably assured; and (d) delivery has occurred or service has been rendered. Delivery generally occurs when the title and the risks and rewards of ownership have substantially transferred to the customer. Revenue from maintenance contracts or extended warranties is recognized on a straight-line basis over the life of the contract, unless another method is more representative of the costs incurred. The Company enters into agreements that contain multiple elements, such as equipment, installation and service revenue. For multiple-element arrangements, the Company recognizes revenue for delivered elements when the delivered item has stand-alone value to the customer, fair values of undelivered elements are known, customer acceptance has occurred, and only customary refund or return rights exist related to the delivered elements. Revenues from certain of our equipment and the related installation sold under construction-type contracts are recorded using the percentage-of-completion method in accordance with Statement of Position 81-1, “Accounting for Performance of Construction-Type and Certain Production-Type Contracts.” Revenues associated with contracts accounted for under the percentage of completion method of accounting amounted to approximately five percent of the Company’s 2008 net revenues.

Environmental Costs: The Company is subject to laws and regulations relating to protecting the environment. Environmental expenditures relating to current operations are expensed or capitalized as appropriate. Expenditures relating to existing conditions caused by past operations, which do not contribute to current or future revenues, are expensed. Liabilities for remediation costs are recorded when they are probable and can be reasonably estimated, generally no later than the completion of feasibility studies or the Company’s commitment to a plan of action. The assessment of this liability, which is calculated based on existing technology, does not reflect any offset for possible recoveries from insurance companies, and is not discounted.

Asbestos Matters: Certain wholly owned subsidiaries of the Company are named as defendants in asbestos-related lawsuits in state and federal courts. The Company records a liability for its actual and anticipated future claims as well as an asset for anticipated insurance settlements. Although the Company was neither a manufacturer nor producer of asbestos, some of its formerly manufactured components from third party suppliers utilized asbestos related components. As a result, amounts related to asbestos are recorded within Discontinued operations, net of tax, except for amounts related to Trane asbestos liabilities, which are recorded in continuing operations. Refer to Note 22 for further details of asbestos related matters.

F-10

Research and Development Costs: The Company conducts research and development activities for the purpose of developing and improving new products and services. These expenditures, including qualifying engineering costs, are expensed when incurred and included in Cost of goods sold. For the years ended December 31, 2008, 2007 and 2006, these expenditures amounted to $131.6 million, $128.6 million and $126.7 million, respectively. The Company also incurs engineering costs that are not considered research and development expenditures.

Software Costs: The Company follows the guidance outlined in Statement of Position 98-1, “Accounting for the Costs of Computer Software Developed or Obtained for Internal Use” for all software developed or obtained for internal use, which requires companies to capitalize certain internal-use software costs once specific criteria are met and subsequently amortize these costs over the software’s useful life, which ranges from 2 to 7 years.

Employee Benefit Plans: The Company provides a range of benefits to eligible employees and retired employees, including pensions, postretirement and post-employment benefits. Determining the cost associated with such benefits is dependent on various actuarial assumptions, including discount rates, expected return on plan assets, compensation increases, employee mortality and turnover rates, and health-care cost trend rates. Actuaries perform the required calculations to determine expense in accordance with generally accepted accounting principles in the United States. Actual results may differ from the actuarial assumptions and are generally accumulated and amortized into earnings over future periods. Effective December 31, 2006, these amounts are generally recognized into Shareholders’ equity on an annual basis, due to the adoption of SFAS 158. The Company reviews its actuarial assumptions at each measurement date and makes modifications to the assumptions based on current rates and trends, if appropriate. In 2008, the Company changed the measurement date for all defined benefit plans from November 30 to December 31, as required by the measurement date provision of SFAS 158.

Loss Contingencies: Liabilities are recorded for various contingencies arising in the normal course of business, including litigation and administrative proceedings, environmental matters, product liability, product warranty, worker’s compensation and other claims. The Company has recorded reserves in the financial statements related to these matters, which are developed using input derived from actuarial estimates and historical and anticipated experience data depending on the nature of the reserve, and in certain instances with consultation of legal counsel, internal and external consultants and engineers. Subject to the uncertainties inherent in estimating future costs for these types of liabilities, the Company believes its estimated reserves are reasonable and does not believe the final determination of the liabilities with respect to these matters would have a material effect on the financial condition, results of operations, liquidity or cash flows of the Company for any year.

Derivative Instruments: The Company periodically enters into cash flow and other hedge transactions to specifically hedge exposure to various risks related to interest rates, currency rates and commodity pricing. The Company recognizes all derivatives on the consolidated balance sheet at their fair value as either assets or liabilities. For cash flow designated hedges, the effective portion of the changes in fair value of the derivative contract are recorded in Other comprehensive income, net of taxes, and are recognized in the income statement at the time earnings are affected by the hedged transaction. For other hedge transactions, the changes in the fair value of the derivative contract are recognized in the consolidated statement of income.

Recently Adopted Accounting Pronouncements:

F-11

payment issued. Under the modified prospective method, financial statement amounts for prior periods have not been restated to reflect the fair value method of recognizing compensation cost relating to stock options.

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106 and 132(R)” (SFAS 158). SFAS 158 requires an entity to recognize in its balance sheet the funded status of its defined benefit pension and postretirement plans. The standard also requires an entity to recognize changes in the funded status within Accumulated other comprehensive income, net of tax, to the extent such changes are not recognized in earnings as components of periodic net benefit cost.

F-12

Recently Issued Accounting Pronouncements:

F-13

Accounting Standards Board (IASB). Under the proposed roadmap, we could be required, in 2014, to prepare financial statements in accordance with IFRS. The SEC will make a determination in 2011 regarding the mandatory adoption of IFRS. We are currently assessing the impact that this potential change would have on our consolidated financial statements, and we will continue to monitor the development of the potential implementation of IFRS.

NOTE 3 – ACQUISITION OF TRANE INC.

At the close of business on June 5, 2008, the Company completed its previously announced acquisition of 100% of the outstanding common shares of Trane. Trane, formerly American Standard Companies Inc., provides systems and services that enhance the quality and comfort of the air in homes and buildings around the world. Trane’s systems and services have leading positions in premium commercial, residential, institutional and industrial markets, a reputation for reliability, high quality and product innovation and a powerful distribution network. Trane’s 2007 annual revenues were $7.5 billion.

The Company paid a combination of (i) 0.23 of an IR-Limited Class A common share and (ii) $36.50 in cash, without interest, for each outstanding share of Trane common stock. The total cost of the acquisition was approximately $9.6 billion, including change in control payments and direct costs of the transaction. The Company financed the cash portion of the acquisition with a combination of cash on hand, commercial paper and a 364-day senior unsecured bridge loan facility.

The components of the purchase price were as follows:


In billions
Cash consideration	$	7.3
Stock consideration (Issuance of 45.4 million IR-Limited Class A common shares)		2.0
Estimated fair value of Trane stock options converted to 7.4 million IR-Limited stock options		0.2
Transaction costs		0.1
Total	$	9.6

F-14

The following table summarizes the preliminary fair values of the Trane assets acquired and liabilities assumed at the Acquisition Date.


In millions	June 5, 2008
Current assets:
Cash and cash equivalents	$	317.5
Accounts and notes receivable		1,185.6
Inventories		970.5
Other current assets		462.0
Total current assets		2,935.6

Property, plant and equipment		1,060.4
Goodwill		5,529.9
Intangible assets		5,576.0
Other noncurrent assets		719.4
Total assets	$	15,821.3

Current liabilities:
Accounts payable	$	562.9
Accrued compensation and benefits		225.7
Accrued expenses and other current liabilities		1,062.3
Short-term borrowings and current maturities of long-term debt		254.3
Total current liabilities		2,105.2

Long-term debt		476.3
Postemployment and other benefit liabilities		318.0
Deferred income taxes		2,291.1
Other noncurrent liabilities		1,012.7
Minority interests		7.7
Total liabilities and minority interests	$	6,211.0
Net assets acquired	$	9,610.3

Cash and cash equivalents, accounts and notes receivable, accounts payable and accrued compensation and benefits were stated at their historical carrying values, which approximate their fair value, given the short-term nature of these assets and liabilities.

Inventories were recorded at fair value, based on computations which considered many factors, including the future estimated selling price of the inventory, the cost to dispose of the inventory, as well as the replacement cost of the inventory, where applicable.

The Company recorded intangible assets based on their estimated fair value, and consisted of the following:


In millions	Useful life	Amount
Tradenames	Indefinite	$	3,418.0
Customer relationships	17 -18 Years		1,871.0
Completed technology/patents	5 - 15 Years		158.0
In-process research and development	Expensed		26.0
License agreement	7 Years		4.0
Backlog	1 - 6 Months		99.0
Total		$	5,576.0

F-15

The Company has allocated $3,418.0 million to tradenames, primarily related to the Trane brand. Management considered many factors in the determination that it will account for the asset as an indefinite lived intangible asset, including the current market leadership position of the brand as well as recognition worldwide in the industry. Therefore, in accordance with Statement of Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets”, tradenames will not be amortized, but instead will be tested for impairment at least annually (more frequently if certain indicators are present).

In addition, the Company assigned $26.0 million to in-process research and development assets that were expensed at the date of acquisition in accordance with Financial Accounting Standards Board (FASB) Interpretation No. 4, “Applicability of FASB Statement No. 2 to Business Combinations Accounted for by the Purchase Method.” The expenses are included in general and administrative expenses.

The excess of the purchase price over the amounts allocated to specific assets and liabilities is included in goodwill, and amounted to $5,529.9 million. The premium in the purchase price paid by the Company for the acquisition of Trane reflects the establishment of an $11 billion business offering high value equipment, systems and services necessary for delivering solutions across the temperature spectrum for indoor, stationary and transport applications worldwide. The Company anticipates realizing significant operational and cost synergies. Anticipated synergies include purchase material savings through supplier rationalization and procurement leverage, improvement in manufacturing costs and lower general and administrative costs. Longer term, the Company expects to benefit from synergies related to service revenue expansion, leverage of distribution channels and cross selling through certain vertical markets.

In addition, Trane will be able to leverage the Company’s global footprint to enhance their historically U.S.-based revenue generation. Lastly, the combined business will improve the Company’s highly regarded Hussmann and Thermo King brands with Trane’s position as a leader in the commercial and residential climate control industry. These combined factors primarily contributed to a purchase price in excess of the fair value of the net tangible assets acquired.

The following unaudited pro forma information assumes the acquisition of Trane occurred as of the beginning of the respective periods presented:


	December 31,
In millions	2008			2007
Net revenues	$	16,361.6		$	16,205.6
Pre-tax profit (loss)		(2,778.4	)		994.2
Net earnings (loss)		(2,586.2	)		722.6
Basic earnings (loss) per common share	$	(8.08	)	$	2.15
Diluted earnings (loss) per common share		(8.08	)		2.11

The unaudited pro forma financial information for the year ended December 31, 2007 include $103.0 million of after tax, non-recurring purchase accounting charges associated with the fair value allocation of purchase price to backlog, inventory and in-process research and development costs.

In addition, for the year ended December 31, 2008, the Company has included $89.1 million as an after tax increase to interest expense associated with the borrowings to fund (a) the cash portion of the purchase price and (b) the out-of-pocket transaction costs associated with the acquisition. The comparative amount for the year ended December 31, 2007 was $217.2 million.

F-16

For the year ended December 31, 2008, the Company has recognized a pre-tax, non-cash charge of $3.7 billion related to the impairment of goodwill and indefinite-lived intangible assets, which is reflected in the pro forma results presented above. For a further discussion of impairment related matters, see Note 4 in the consolidated financial statements.

The unaudited pro forma information does not purport to be indicative of the results that actually would have been achieved had the operations been combined during the periods presented, nor is it intended to be a projection of future results or trends.

NOTE 4 – ASSET IMPAIRMENT

Goodwill and other intangible assets with indefinite useful lives are not amortized, but instead are tested for impairment at least annually and more frequently whenever events or changes in circumstances indicate that the fair value of the asset may be less than its carrying amount of the asset. The Company tests for impairment during the fourth quarter of its fiscal year using October 1 ^st carrying values. Due to the continued deterioration in the worldwide equity and credit markets and a tightening of industrial and retail end markets, the Company’s market capitalization declined well below its book value during the fourth quarter of 2008. In addition, the Company projects a decline in its 2009 financial performance. As a result, the Company updated its impairment testing through December 31, 2008, taking into consideration recent market declines.

Goodwill Impairment

The test for goodwill impairment is a two step process. The first step compares the carrying amount of the reporting unit to its estimated fair value (Step 1). To the extent that the carrying value of the reporting unit exceeds its estimated fair value, a second step is performed, wherein the reporting unit’s carrying value of goodwill is compared to the implied fair value of goodwill (Step 2). To the extent that the carrying value exceeds the implied fair value of goodwill, impairment exists and must be recognized.

As quoted market prices are not available for the Company’s reporting units, the fair value of the reporting units is determined using both a discounted cash flow model (income approach) and a market adjusted multiple of earnings and revenues (market approach), with each method being equally weighted in the calculation. Both methods use various assumptions that are specific to each individual reporting unit in order to determine the fair value. In addition, the Company compared the estimated aggregate fair value of its reporting units to its overall market capitalization. The Company completed Step 1 of the impairment test and determined that the reporting units within the Air Conditioning System and Services sector and the European reporting unit of the Security Technologies sector did not pass Step 1.

In Step 2, the Company is required to use the fair value calculated in Step 1 and apply the fair value to the assets and liabilities of the reporting unit based on a hypothetical purchase price allocation. The implied fair value of goodwill is determined in the allocation process and compared to the book value of goodwill. As a result, the Company realized an impairment charge to goodwill of $2,840.0 million. For further details, refer to the table below.

Indefinite-lived Intangible Assets

The test for impairment of indefinite-lived intangible assets (i.e. Tradenames) is measured by comparing the carrying amount of the intangible assets to the fair value of the respective intangible assets. Any excess of the carrying value over the calculated fair value of the intangible asset is recognized as an impairment loss.

The fair value of each of the Company’s Tradenames was determined based on a relief from royalty income methodology, which present values the after-tax cost savings (i.e. royalty relief) at an

F-17

appropriate discount rate in order to compute the value of the Tradenames. Based on the calculated fair value, management determined that certain Tradenames were impaired in the aggregate amount of $860.0 million. For further details of the impairment charge refer to the table below.

Marketable Securities

The Company determined that its investment in certain marketable securities was other than temporarily impaired. This analysis was based on the current trading value of the publicly listed marketable security in addition to other qualitative factors of the operating business environment in which the security is held.

The following table summarizes the impairment charges that were taken by sector during 2008:


In millions	Goodwill		Intangible Assets		Marketable Securities		Total
Air Conditioning Systems and Services	$	2,496.0	$	814.0	$	-	$	3,310.0
Climate Control Technologies		-		40.0		-		40.0
Security Technologies		344.0		6.0		10.0		360.0
Total	$	2,840.0	$	860.0	$	10.0	$	3,710.0

NOTE 5 – RESTRUCTURING ACTIVITIES

Restructuring charges recorded during the year ended December 31, 2008 were as follows:


In millions	Air Conditioning Systems and Services		Climate Control Technologies		Industrial Technologies		Security Technologies		Corporate and Other		Total
Cost of goods sold	$	6.3	$	32.9	$	7.0	$	10.5	$	-	$	56.7
Selling and administrative		10.9		5.7		2.6		2.6		12.4		34.2
Total	$	17.2	$	38.6	$	9.6	$	13.1	$	12.4	$	90.9

Restructuring charges recorded during the year ended December 31, 2007 were as follows:


In millions	Air Conditioning Systems and Services		Climate Control Technologies		Industrial Technologies		Security Technologies		Corporate and Other		Total
Cost of goods sold	$	-	$	22.3	$	0.6	$	1.9	$	-	$	24.8
Selling and administrative		-		0.1		0.4		3.4		-		3.9
Total	$	-	$	22.4	$	1.0	$	5.3	$	-	$	28.7

F-18

The changes in the restructuring reserve were as follows:


In millions	Air Conditioning Systems and Services			Climate Control Technologies			Industrial Technologies			Security Technologies			Corporate and Other			Total
December 31, 2006	$	-		$	-		$	-		$	1.3		$	-		$	1.3
Additions		-			22.4			1.0			5.3			-			28.7
Cash and non-cash uses		-			(3.0	)		(0.3	)		(2.7	)		-			(6.0	)
Currency translation		-			1.4			-			0.1			-			1.5
December 31, 2007		-			20.8			0.7			4.0			-			25.5
Additions		17.2			38.6			9.6			13.1			12.4			90.9
Purchase accounting		14.8			-			-			-			-			14.8
Cash and non-cash uses		(15.3	)		(27.1	)		(7.6	)		(6.2	)		(11.3	)		(67.5	)
Currency translation		0.4			0.2			-			0.2			-			0.8
December 31, 2008	$	17.1		$	32.5		$	2.7		$	11.1		$	1.1		$	64.5

During 2007, the Company initiated restructuring actions relating to ongoing cost reduction efforts across each of its sectors. These actions included both workforce reductions as well as the consolidation of manufacturing facilities.

During the first three quarters of 2008, the Company incurred costs of approximately $20 million associated with various restructuring activities as a part of an ongoing effort to increase efficiencies across multiple lines of business. In October 2008, the Company announced an enterprise-wide restructuring program. This program included streamlining the footprint of manufacturing facilities and reducing the general and administrative cost base across all sectors of the company. Projected costs will approximate $110 million, of which $71 million was incurred during the fourth quarter. At December 31, 2008, the Company had $64.5 million accrued for workforce reductions and the consolidation of manufacturing facilities.

Restructuring actions taken in the Air Conditioning Systems and Services sector include the closing of three parts locations in the U.S., the closing of a manufacturing facility in Asia and a general workforce reduction due to a revised organizational structure within the commercial sector. As of December 31, 2008, the Air Conditioning Systems and Services sector had incurred approximately $15 million related to the restructuring program announced in October 2008.

In connection with the acquisition of Trane, at the Acquisition Date, the Company began formulating a plan to exit or restructure certain activities. The Company recorded purchase accounting liabilities of $14.8 million primarily related to employee severance and related costs in connection with the preliminary plan as well as approving the continuation of all existing restructuring and exit plans.

Restructuring actions taken in the Climate Control Technologies sector include the closing of two manufacturing facilities in order to consolidate manufacturing operations in the European and Americas regions, as well as a general workforce reduction in Europe. As of December 31, 2008, the Climate Control Technologies sector had incurred approximately $38 million related to the restructuring program announced in October 2008.

F-19

Restructuring actions taken in the Industrial Technologies sector include the consolidation of manufacturing facilities in the U.S. and general workforce reductions in Europe. As of December 31, 2008, the Industrial Technologies sector had incurred approximately $5 million related to the restructuring program announced in October 2008.

Restructuring actions taken in the Security Technologies sector include the consolidation of manufacturing facilities in the Americas region and general workforce reductions in Europe. As of December 31, 2008, the Security Technologies sector had incurred approximately $11 million related to the restructuring program announced in October 2008.

Corporate costs primarily related to the consolidation of administrative offices in the U.S. As of December 31, 2008, the corporate costs related to the restructuring program totaled approximately $2 million announced in October 2008.

NOTE 6 – MARKETABLE SECURITIES

At December 31, marketable securities were as follows:


	2008							2007
In millions	Amortized cost or cost		Unrealized losses			Fair value		Amortized cost or cost		Unrealized losses			Fair value
Short-term marketable securities:
Equity securities	$	-	$	-		$	-	$	0.1	$	-		$	0.1
Total	$	-	$	-		$	-	$	0.1	$	-		$	0.1
Long-term marketable securities:
Equity securities	$	6.7	$	(0.2	)	$	6.5	$	17.3	$	(4.9	)	$	12.4
Total	$	6.7	$	(0.2	)	$	6.5	$	17.3	$	(4.9	)	$	12.4

Long-term marketable securities are included within Other assets on the Consolidated Balance Sheet.

During 2008, the Company’s long-term marketable securities experienced other than temporary declines in value as defined by EITF 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments.” The Company recognized a loss of approximately $10 million related to investments within the Security Technologies segment in the fourth quarter of 2008. The loss is included in Asset impairment on the Consolidated Statement of Income. For a further discussion of impairment related matters, see Note 4 in the consolidated financial statements.

NOTE 7 – INVENTORIES

At December 31, the major classes of inventory were as follows:


In millions	2008			2007
Raw materials	$	446.9		$	323.2
Work-in-process		301.7			163.4
Finished goods		980.0			424.9
		1,728.6			911.5
LIFO reserve		(113.5	)		(84.3	)
Total	$	1,615.1		$	827.2

F-20

NOTE 8 – PROPERTY, PLANT AND EQUIPMENT

At December 31, the major classes of property, plant and equipment were as follows:


In millions	2008			2007
Land	$	111.3		$	65.4
Buildings		776.6			485.7
Machinery and equipment		1,787.1			1,056.6
Software		345.5			174.5
		3,020.5			1,782.2
Accumulated depreciation		(1,052.0	)		(877.3	)
Total	$	1,968.5		$	904.9

Depreciation expense for the years ended December 31, 2008, 2007 and 2006 was $201.2 million, $112.3 million and $122.7 million, which include amounts for software amortization of $35.5 million, $17.5 million and $23.1 million, respectively.

NOTE 9 – GOODWILL

The changes in the carrying amount of goodwill are as follows:


In millions	Air Conditioning Systems and Services			Climate Control Technologies			Industrial Technologies			Security Technologies			Total
December 31, 2006	$	-		$	2,545.1		$	341.2		$	950.9		$	3,837.2
Acquisitions and adjustments *		-			-			22.0			(6.1	)		15.9
Currency translation		-			68.7			8.7			62.8			140.2
December 31, 2007		-			2,613.8			371.9			1,007.6			3,993.3
Acquisitions and adjustments *		5,529.9			1.1			5.4			20.6			5,557.0
Currency translation		-			(37.9	)		(7.5	)		(44.8	)		(90.2	)
Impairment		(2,496.0	)		-			-			(344.0	)		(2,840.0	)
December 31, 2008	$	3,033.9		$	2,577.0		$	369.8		$	639.4		$	6,620.1

*	Includes current year adjustments related to final purchase price allocation adjustments.

The Company records as goodwill the excess of the purchase price over the fair value of the net assets acquired. Once the final valuation has been performed for each acquisition, adjustments may be recorded.

The increase in goodwill is primarily associated with the acquisition of Trane in the second quarter of 2008. As of December 31, 2008, the Company recognized $5.5 billion of goodwill associated with this transaction, which is recorded in the Air Conditioning Systems and Services segment. See Note 3 for a further discussion regarding goodwill associated with the acquisition of Trane.

As a result of the annual impairment testing in the fourth quarter of 2008, the Company recognized a pre-tax, non-cash charge of $2,840.0 million related to the impairment of goodwill. See Note 4 for a further discussion of impairment related matters.

F-21

NOTE 10 – INTANGIBLE ASSETS

The following table sets forth the gross amount and accumulated amortization of the Company’s intangible assets at December 31:


In millions	2008			2007
Trademarks	$	2,831.7		$	283.8
Customer relationships		2,368.2			502.4
Completed technology/patents		203.1			38.2
Other		189.6			53.4
Total gross intangible assets		5,592.6			877.8
Accumulated amortization		(378.5	)		(153.2	)
Total	$	5,214.1		$	724.6

At December 31, 2008, the Company had $5.2 billion of intangible assets. Per SFAS No. 142, “Goodwill and Other Intangible Assets,” intangible assets with finite useful lives are amortized on a straight-line basis over their estimated economic lives. Indefinite-lived intangible assets are not subject to amortization in accordance with SFAS No. 142, but instead, are tested for impairment at least annually (more frequently if certain indicators are present).

The increase from December 31, 2007 is primarily attributable to the acquisition of Trane in the second quarter of 2008 in which the Company recognized approximately $5,576.0 million of intangible assets including $3,418.0 million of indefinite-lived trademarks and $1,871.0 million of customer relationships. See Note 3 for a further discussion on the acquisition of Trane.

As of December 31, 2008 and December 31, 2007, the Company had $2,722.4 million and $169.3 million, respectively, of indefinite lived intangible assets. In the fourth quarter of 2008, the Company recognized a pre-tax, non-cash impairment charge of $860.0 million related to indefinite-lived intangible assets. See Note 4 for a further discussion of impairment related matters.

Intangible asset amortization expense for 2008, 2007 and 2006 was $226.3 million, $25.2 million and $24.8 million, respectively. The increase in 2008 is attributable to the Company’s acquisition of Trane on June 5, 2008, which includes $125.0 million of non-recurring amortization expense related to the fair value allocation of purchase price to backlog and in-process research and development costs. The non-recurring amortization expense is included in Accumulated amortization and the associated gross asset is included in Other in the above table. See Note 3 for a further discussion on the acquisition of Trane.

Estimated amortization expense on existing intangible assets is approximately $160 million for each of the next five fiscal years.

NOTE 11 – ACCOUNTS RECEIVABLE SECURITIZATION AGREEMENTS

In association with the acquisition of Trane, the consolidated financial statements include Trane’s accounts receivable securitization agreement (the Facility) in the U.S. As part of this Facility, Trane formed a special-purpose entity (SPE) that is included in the consolidated financial statements for the sole purpose of buying and selling receivables generated by Trane. Trane irrevocably and without recourse, transfers all eligible accounts receivable to the SPE, which in turn, sells them, or undivided ownership interests in them, to conduits administered by a participating bank. After the sale of the accounts receivable, Trane has no continuing involvement other than in the collection process. In addition, the assets of the SPE are not available to pay the claims of Trane or any of its subsidiaries.

F-22

The receivables sold are removed from the balance sheet since they meet the applicable criteria of SFAS No. 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities.” Trane’s retained interest is recorded at fair value in the balance sheet. To the extent that the cash received and value of the retained interest is less than the net book value of the receivable sold, losses are recognized at the time of sale. For the year ended December 31, 2008, the losses amounted to $2.0 million. The receivables represented by the retained interest are exposed to the risk of loss for any uncollectible amounts in the pool of receivables sold under this arrangement.

The following is a summary of receivables sold to the financing facilities:


In millions	December 31, 2008
Outstanding balance of receivables sold to SPE	$	149.5
Net retained interest		83.6
Advances from conduits		62.8

The advances from conduits include amounts due to the conduits for the collections of receivables under the servicing agreement.

NOTE 12 – DEBT AND CREDIT FACILITIES

At December 31, short-term borrowings and current maturities of long-term debt consisted of the following:


In millions	2008		2007
Commercial paper program	$	998.7	$	-
Bridge loan facility		754.0		-
Current maturities of long-term debt *		548.4		681.1
Other short-term borrowings		49.3		59.9
Total	$	2,350.4	$	741.0

* Includes $345.7 million of debt redeemable at the option of the holder. The scheduled maturities of these bonds range between 2027 and 2028.

The weighted-average interest rate for total short-term borrowings at December 31, 2008 and 2007 was 4.8% and 6.9%, respectively.

At December 31, long-term debt excluding current maturities consisted of:


In millions	2008		2007
Senior floating rate notes due 2010	$	250.0	$	-
7.625% Senior notes due 2010		261.2		-
6.000% Senior notes due 2013		599.8		-
5.50% Senior notes due 2015		199.6		-
4.75% Senior notes due 2015		299.2		299.1
6.875% Senior notes due 2018		749.0		-
9.00% Debentures due 2021		125.0		125.0
7.20% Debentures due 2009-2025		120.0		127.5
6.48% Debentures due 2025		149.7		149.7
Other loans and notes, at end-of-year average interest rates of 5.68% in 2008 and 4.32% in 2007, maturing in various amounts to 2018		20.2		11.4
Total	$	2,773.7	$	712.7

F-23

The fair value of long-term debt, including current maturities of long-term debt, at December 31, 2008 and 2007, was $3,125.8 million and $1,336.7 million, respectively. The fair value of long-term debt was based upon quoted market values.

At December 31, 2008, long-term debt retirements are as follows:


In millions
2009	$	548.4
2010		525.8
2011		11.3
2012		10.8
2013		608.9
Thereafter		1,616.9
Total	$	3,322.1

In connection with the acquisition of Trane, the Company entered into a $3.9 billion senior unsecured bridge loan facility, with a 364-day term. The Company drew down $2.95 billion against the bridge loan facility in June 2008. The proceeds, along with cash on hand and the issuance of $1.5 billion of commercial paper, were used to fund the cash component of the consideration paid for the acquisition as well as to pay related fees and expenses incurred in connection with the acquisition.

In August 2008, the Company filed a universal shelf registration statement with the Securities and Exchange Commission (SEC) for an indeterminate amount of securities for future issuance and issued $1.6 billion of long-term debt pursuant to the shelf registration statement. This issuance consisted of $250 million Senior Floating Rate Notes due in 2010, $600 million 6.000% Senior Notes due in 2013 and $750 million 6.875% Senior Notes due in 2018. These notes are fully and unconditionally guaranteed by IR-Limited, which directly owns 100% of the subsidiary issuer, IR Global Holding Company Limited. The net proceeds from the offering were used to partially reduce the amount outstanding under the senior unsecured bridge loan facility.

During the third quarter, the Company repaid $2.0 billion of the outstanding balance of the bridge loan facility. The Company used a combination of cash flows from operations and cash on hand, in addition to the $1.6 billion in proceeds received from the issuance of long-term debt. In October 2008, the Company reduced the bridge loan facility size to $950 million and subsequently repaid an additional $196 million of the outstanding balance during the fourth quarter of 2008. At December 31, 2008, the outstanding balance of the bridge loan facility was $754 million.

At December 31, 2008, the Company’s committed revolving credit facilities totaled $3.0 billion, of which $750 million expires in June 2009, $1.25 billion expires in August 2010 and $1.0 billion expires in June 2011. These lines are unused and provide support for the Company’s commercial paper program as well as for other general corporate purposes. In addition, other available lines of credit were $811.7 million, of which $651.3 million were unused at December 31, 2008. These lines provide support for bank guarantees, letters of credit and other general corporate purposes.

Debentures with Put Feature

At December 31, 2007, The Company had outstanding $547.9 million of fixed rate debentures which only requires early repayment at the option of the holder. These debentures contain a put feature that the holders may exercise on each anniversary of the issuance date. If exercised, the Company is obligated to repay in whole or in part, at the holder’s option, the outstanding principal amount (plus accrued and

F-24

unpaid interest) of the debentures held by the holder. If these options are not exercised, the final maturity dates would range between 2027 and 2028. In the fourth quarter of 2008, holders of these debentures chose to exercise the put feature on approximately $202 million of the debentures, which was repaid in November 2008.

NOTE 13 – FINANCIAL INSTRUMENTS

In the normal course of business, the Company uses various financial instruments, including derivative instruments, to manage risks associated with interest rate, currency rate, commodity price and share-based compensation exposures. Derivative instruments are not used for trading or speculative purposes. On the date a derivative contract is entered into, the Company designates the derivative instrument as either a hedge of a forecasted transaction (a cash flow hedge) or a hedge of recognized asset or liability (a cash flow or undesignated hedge). The Company formally documents its hedge relationships, including identification of the derivative instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transaction. This process includes linking derivative instruments that are designated as hedges to specific assets, liabilities or forecasted transactions.

The Company also assesses both at the inception and at least quarterly thereafter, whether the derivatives used in hedging transactions are highly effective in offsetting the changes in the cash flows of the hedged item. Any ineffective portion of a derivative instrument’s change in fair value is recorded in the income statement in the period of change. If the hedging relationship ceases to be highly effective, or it becomes probable that a forecasted transaction is no longer expected to occur, the hedging relationship will be undesignated and any future gains and losses on the derivative instrument would be recorded in the income statement.

The fair market value of derivative instruments are determined through market-based valuations and may not be representative of the actual gains or losses that will be recorded when these instruments mature due to future fluctuations in the markets in which they are traded.

Currency and Commodity Hedging Instruments

The estimated fair value of currency hedges outstanding at December 31, 2008 and 2007, was a projected gain of $15.1 million and a projected loss of $5.2 million, respectively. The notional amounts of the currency hedges were $920.4 million and $355.5 million at December 31, 2008 and 2007, respectively. At December 31, 2008 and 2007, $7.6 million and $2.4 million, net of tax, respectively, was included in Accumulated other comprehensive income (loss) related to the fair value of currency hedges. The amount expected to be reclassified to earnings over the next twelve months is $7.6 million. The actual amounts that will be reclassified to earnings may vary from this amount as a result of changes in market conditions. At December 31, 2008, the maximum term of the Company’s currency hedges was 12 months.

The estimated fair value of commodity hedges outstanding at December 31, 2008 and 2007 was a projected loss of $10.1 million and $2.4 million, respectively. The notional amount of the commodity hedges was $21.3 million and $22.2 million at December 31, 2008 and 2007, respectively. During 2008, the Company discontinued the use of hedge accounting for the commodity hedges. The Company recognized into the income statement all deferred gains and losses related to the commodity hedges at the time of discontinuance.

Other Hedging Instruments

As a result of the acquisition of Trane, the Company assumed a cross currency swap that fixes in U.S. dollars the currency cash flows on the £60.0 million 8.25% senior notes due June 1, 2009. The cross currency swap meets the criteria to be accounted for as a foreign currency cash flow hedge. At December 31, 2008, the cross currency swap had a fair value of $35.8 million.

F-25

During 2008, the Company entered into interest rate locks for the forecasted issuance of $1.4 billion of Senior Notes due in 2013 and 2018. These interest rate locks met the criteria to be accounted for as cash flow hedges of a forecasted transaction. Consequently, the changes in fair value of the interest rate locks were deferred in Accumulated other comprehensive income (loss) and will be recognized into interest expense over the life of the notes. At December 31, 2008, $14.4 million of deferred losses was included in Accumulated other comprehensive income (loss) related to the interest rate locks, of which $1.8 million is expected to be reclassified into interest expense over the next twelve months.

In August 2006, the Company entered into two total return swaps (the Swaps) which were derivative instruments used to hedge the Company’s exposure to changes in its share-based compensation expense. The aggregate notional amount of the Swaps was approximately $52.6 million. On June 11, 2007, the Company terminated a portion of the Swaps for net cash proceeds of $3.8 million. The Company settled the remaining portion of the Swaps on August 6, 2007, for net cash proceeds of $13.8 million. The gains and losses associated with the Swaps were recorded within Selling and administrative expenses.

In March 2005, the Company entered into interest rate locks for the forecasted issuance of $300 million of Senior Notes due 2015. These interest rate locks met the criteria to be accounted for as cash flow hedges of a forecasted transaction. Consequently, the changes in fair value of the interest rate locks were deferred in Accumulated other comprehensive income (loss) and will be recognized into interest expense over the life of the notes. At December 31, 2008, $7.6 million of deferred losses was included in Accumulated other comprehensive income (loss) related to the interest rate locks, of which $1.0 million is expected to be reclassified into interest expense over the next twelve months.

Concentration of Credit Risk

The counterparties to the Company’s forward contracts consist of a number of highly rated major international financial institutions. The Company could be exposed to losses in the event of nonperformance by the counterparties. However, credit ratings and concentration of risk of these financial institutions are monitored on a continuous basis and present no significant credit risk to the Company.

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, accounts receivable, short-term borrowings and accounts payable are a reasonable estimate of their fair value due to the short-term nature of these instruments.

NOTE 14 – POSTRETIREMENT BENEFITS OTHER THAN PENSIONS

The Company sponsors several postretirement plans that cover certain eligible employees, including certain Trane employees since the acquisition date. These plans provide for health-care benefits, and in some instances, life insurance benefits. Postretirement health plans generally are contributory and contributions are adjusted annually. Life insurance plans for retirees are primarily noncontributory. The Company funds the postretirement benefit costs principally on a pay-as-you-go basis.

In 2006, the Company adopted SFAS 158, which required the Company to record the funded status of its postretirement plans on its balance sheet effective December 31, 2006. The adoption of SFAS 158 for the Company’s postretirement plans other than pensions resulted in an increase of total liabilities of $300.4 million and a decrease of total shareholders’ equity of $135.7 million (net of tax of $164.7 million).

In 2008, the Company adopted the measurement date provision of SFAS 158 which required the measurement of plan assets and benefit obligations as of the date of the year-end financial statements.

F-26

The Company recorded a one-time after-tax charge for postretirement benefits of $2.5 million to Retained earnings ($4.7 million pre-tax) as a result of changing the measurement date from November 30 ^th to December 31 ^st .

As a result of the acquisition of Trane in the second quarter of 2008, the Company assumed unfunded obligations for retirement benefits other than pensions in the amount of $268.9 million. In connection with the sale of Compact Equipment and the Road Development business unit during 2007, the Company settled its obligation for postretirement benefits for all current and former employees related to these divestitures. In addition, the Company’s U.S. postretirement plan was remeasured as of the sale dates.

The following table details information regarding the Company’s postretirement plans at December 31:


In millions	2008			2007
Change in benefit obligations:
Benefit obligation at beginning of year	$	649.8		$	1,035.2
Service cost		7.3			11.8
Interest cost		49.7			54.2
Plan participants’ contributions		14.9			13.4
Actuarial (gains) losses		16.6			(1.7	)
Benefits paid, net of Medicare Part D subsidy *		(69.9	)		(88.9	)
Settlements/curtailments		-			(375.8	)
Adjustments due to adoption of SFAS 158 measurement date provision		3.6			-
Acquisition		268.9			-
Other		5.3			1.6
Benefit obligations at end of year	$	946.2		$	649.8

*	Amounts are net of Medicare Part D subsidy of $9.5 and $1.9 million in 2008 and 2007, respectively


Funded status:
Plan assets less than benefit obligations	$	(946.2	)	$	(649.8	)

Amounts included in the balance sheet:
Accrued compensation and benefits	$	(70.4	)	$	(51.1	)
Postemployment and other benefit liabilities		(875.8	)		(598.7	)
Total	$	(946.2	)	$	(649.8	)

The pretax amounts recognized in Accumulated other comprehensive income (loss) were as follows:


In millions	Prior service gains			Net actuarial losses			Total
Balance at December 31, 2007	$	14.5		$	(191.4	)	$	(176.9	)
Current year changes recorded to Accumulated other comprehensive income (loss)		-			(16.6	)		(16.6	)
Amortization reclassified to earnings		(3.4	)		16.2			12.8
Adjustments due to adoption of SFAS 158 measurement date provisions		(0.3	)		1.4			1.1
Other		-			(2.3	)		(2.3	)
Balance at December 31, 2008	$	10.8		$	(192.7	)	$	(181.9	)

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The components of net periodic postretirement benefit (income) cost for the years ended December 31, were as follows:


In millions	2008			2007			2006
Service cost	$	7.3		$	11.8		$	11.8
Interest cost		49.7			54.2			55.0
Net amortization of prior service gains		(3.4	)		(3.8	)		(4.2	)
Net amortization of net actuarial losses		16.2			15.9			16.6
Net periodic postretirement benefit cost		69.8			78.1			79.2
Net curtailment and settlement (gains) losses		-			(265.9	)		-
Net periodic postretirement benefit (income) cost after net curtailment and settlement (gains) losses	$	69.8		$	(187.8	)	$	79.2



Amounts recorded in continuing operations	$	38.4		$	22.7		$	25.7
Amounts recorded in discontinued operations		31.4			(210.5	)		53.5
Total	$	69.8		$	(187.8	)	$	79.2

Net periodic postretirement cost for 2008 included $13.2 million related to Trane plans. The curtailment and settlement gains and losses in 2007 are associated with the divestiture of Compact Equipment and the Road Development business unit. Postretirement cost for 2009 is projected to be $81 million. Amounts expected to be recognized in net periodic postretirement benefits cost in 2009 for prior service gains and plan net actuarial losses are $3.4 million and $17.0 million, respectively.


Assumptions:	2008	2007	2006
Weighted-average discount rate assumption to determine:
Benefit obligations at December 31	6.25%	6.00%	5.50%
Net periodic benefit cost
For the period January 1 to April 30	6.00%	5.50%	5.50%
For the period May 1 to November 30 *	6.00%	5.75%	5.50%
For the period December 1 to December 31	6.00%	6.00%	5.50%
Assumed health-care cost trend rates at December 31:
Current year medical inflation	11.00%	11.00%	11.00%
Ultimate inflation rate	5.25%	5.25%	5.25%
Year that the rate reaches the ultimate trend rate	2015	2014	2013

*	Trane plans were valued assuming a 6.50% discount rate at the acquisition date.

A 1% change in the medical trend rate assumed for postretirement benefits would have the following effects at December 31, 2008:


In millions	1% Increase		1% Decrease
Effect on total of service and interest cost components	$	1.8	$	(1.6	)
Effect on postretirement benefit obligation		32.4		(26.0	)

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Benefit payments for postretirement benefits, which are net of expected plan participant contributions and Medicare Part D subsidy, are expected to be paid as follows:


In millions
2009	$	71.1
2010		73.4
2011		70.9
2012		76.7
2013		76.1
2014 - 2018		378.4

NOTE 15 – PENSION PLANS

The Company has noncontributory pension plans covering substantially all non-Trane U.S. employees and maintains a pension plan for non-collectively bargained U.S. employees of Trane, whereby eligible employees may elect to participate and receive a credit equal to 3% of eligible pay. In addition, the Company maintains a U.S. collectively bargained pension plan for Trane employees. Certain non-U.S. employees in other countries, including Trane employees, are covered by pension plans.

The Company’s pension plans for U.S. non-collectively bargained employees provided benefits on a final average pay formula. The Company’s U.S. collectively bargained pension plans, including those covering employees of Trane, principally provide benefits based on a flat benefit formula. Non-U.S. plans provide benefits based on earnings and years of service. The Company maintains additional other supplemental benefit plans for officers and other key employees.

In 2006, the Company adopted SFAS 158, which required the Company to record the funded status of its pension plans on its balance sheet effective December 31, 2006. The adoption of SFAS 158 for the Company’s pensions resulted in a decrease of total assets of $476.0 million, total liabilities of $35.4 million and total shareholders’ equity of $337.1 million (net of tax of $103.5 million).

In 2008, the Company adopted the measurement date provision of SFAS 158 which required the measurement of plan assets and benefit obligations as of the date of the year-end financial statements. The Company recorded a one-time after-tax pension charge of $1.2 million to Retained earnings ($1.8 million pre-tax) as a result of changing the measurement date from November 30 ^th to December 31 ^st .

As a result of the acquisition of Trane in the second quarter of 2008, the Company assumed net obligations of $67.7 million, which consisted of long-term prepaid pension costs of $1.4 million and current and noncurrent pension benefit liabilities of $69.1 million. In connection with the sale of Compact Equipment and the Road Development business unit during 2007, the Company settled its obligation for pension benefits for all current and former employees related to these divestitures. In addition, certain of the Company’s U.S. plans and the U.K. plan were remeasured as of the sale dates.

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The following table details information regarding the Company’s pension plans at December 31:


In millions	2008			2007
Change in benefit obligations:
Benefit obligation at beginning of year	$	2,572.4		$	3,175.7
Service cost		58.5			52.0
Interest cost		182.8			164.3
Employee contributions		2.6			2.3
Acquisitions		799.2			0.7
Amendments		12.0			3.1
Actuarial (gains) losses		(9.6	)		(83.6	)
Benefits paid		(232.7	)		(202.4	)
Currency translation		(200.7	)		26.0
Curtailments and settlements		(1.1	)		(561.5	)
Adjustment due to adoption of SFAS 158 measurement date provisions		2.6			-
Other, including expenses paid		31.3			(4.2	)
Benefit obligation at end of year	$	3,217.3		$	2,572.4

Change in plan assets:
Fair value at beginning of year	$	2,500.9		$	2,957.3
Actual return on assets		(523.2	)		211.1
Company contributions		64.1			25.5
Employee contributions		2.6			2.3
Acquisitions		731.5			-
Benefits paid		(232.7	)		(202.4	)
Currency translation		(165.8	)		17.6
Settlements		(0.9	)		(506.3	)
Adjustment due to adoption of SFAS 158 measurement date provisions		(42.5	)		-
Other, including expenses paid		29.1			(4.2	)
Fair value of assets end of year	$	2,363.1		$	2,500.9

Funded status:
Plan assets less than the benefit obligations	$	(854.2	)	$	(71.5	)

Amounts included in the balance sheet:
Long-term prepaid expenses in other assets	$	0.2		$	166.9
Accrued compensation and benefits		(26.0	)		(24.5	)
Post employment and other benefit liabilities		(828.4	)		(213.9	)
Net amount recognized	$	(854.2	)	$	(71.5	)

F-30

The pretax amounts recognized in Accumulated other comprehensive income (loss) were as follows:


In millions	Net transition obligation			Prior service cost			Net actuarial losses			Total
December 31, 2007	$	(1.0	)	$	(44.5	)	$	(392.7	)	$	(438.2	)
Current year changes recorded to Accumulated other comprehensive income (loss)		-			(7.8	)		(788.0	)		(795.8	)
Amortization reclassified to earnings		0.7			8.8			10.3			19.8
Settlements/curtailments reclassified to earnings		-			-			(0.1	)		(0.1	)
Adjustment due to adoption of SFAS 158 measurement date provisions		-			0.7			0.9			1.6
Currency translation		-			0.1			63.9			64.0
December 31, 2008	$	(0.3	)	$	(42.7	)	$	(1,105.7	)	$	(1,148.7	)


Weighted-average assumptions used:
Benefit obligations at December 31,	2008		2007
Discount rate:
U.S. plans	6.25	%	6.25	%
Non-U.S. plans	6.50	%	6.00	%
Rate of compensation increase:
U.S. plans	4.00	%	4.00	%
Non-U.S. plans	4.50	%	4.50	%

The accumulated benefit obligation for all defined benefit pension plans was $3,082.7 million and $2,439.9 million at December 31, 2008 and 2007, respectively. The projected benefit obligation, accumulated benefit obligation, and fair value of plan assets for pension plans with accumulated benefit obligations more than plan assets were $3,194.8 million, $3,066.0 million and $2,345.0 million, respectively, as of December 31, 2008, and $955.9 million, $884.1 million and $716.0 million, respectively, as of December 31, 2007.

Pension benefit payments are expected to be paid as follows:


In millions
2009	$	214.5
2010		242.0
2011		207.6
2012		218.9
2013		229.6
2014 - 2018		1,228.0

F-31

The components of the Company’s pension related costs for the years ended December 31, include the following:


In millions	2008			2007			2006
Service cost	$	58.5		$	52.0		$	54.6
Interest cost		182.8			164.3			161.3
Expected return on plan assets		(230.1	)		(228.7	)		(218.9	)
Net amortization of:
Prior service costs		8.8			9.2			9.4
Transition amount		0.7			0.9			0.9
Plan net actuarial losses		10.3			13.8			25.4
Net periodic pension benefit cost		31.0			11.5			32.7
Net curtailment and settlement (gains) losses		2.3			63.5			-
Net periodic pension benefit cost after net curtailment and settlement (gains) losses	$	33.3		$	75.0		$	32.7


Amounts recorded in continuing operations	$	44.8		$	20.6		$	38.3
Amounts recorded in discontinued operations		(11.5	)		54.4			(5.6	)
Total	$	33.3		$	75.0		$	32.7

Net periodic pension cost for 2008 included $7.3 million related to Trane plans. The curtailment and settlement losses in 2008 are associated with lump sum distributions under supplemental benefit plans for officers and other key employees. The curtailment and settlement gains and losses in 2007 are associated with the divestiture of Compact Equipment and the Road Development business unit. Pension expense for 2009 is projected to be approximately $160 million, utilizing the assumptions for calculating the pension benefit obligations at the end of 2008. The amounts expected to be recognized in net periodic pension cost during the year ended 2009 for the net transition obligation, prior service cost and plan net actuarial losses are $0.3 million, $8.4 million and $57.2 million, respectively.

Weighted-average assumptions used:


Net periodic pension cost for the year ended December 31,	2008		2007		2006
Discount rate:
U.S. plans
For the period January 1 to April 30	6.25	%	5.50	%	5.50	%
For the period May 1 to November 30 *	6.25	%	5.75	%	5.50	%
For the period December 1 to December 31	6.25	%	6.25	%	5.50	%
Non-U.S. plans
For the period January 1 to April 30	6.00	%	5.00	%	5.00	%
For the period May 1 to November 30 *	6.00	%	5.50	%	5.00	%
For the period December 1 to December 31	6.00	%	6.00	%	5.00	%
Rate of compensation increase:
U.S. plans	4.00	%	4.00	%	4.00	%
Non-U.S. plans
For the period January 1 to April 30	4.50	%	4.25	%	4.00	%
For the period May 1 to November 30 *	4.50	%	4.35	%	4.00	%
For the period December 1 to December 31	4.50	%	4.50	%	4.00	%
Expected return on plan assets:
U.S. plans	8.50	%	8.50	%	8.50	%
Non-U.S. plans	7.25	%	7.25	%	7.25	%

* Trane plans were valued at acquisition date assuming 6.75% for the discount rate, 4.00% for the rate of compensation increase and 8.25% for the expected return on plan assets

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The expected long-term rate of return on plan assets reflects the average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the projected benefit obligation. The expected long-term rate of return on plan assets is based on what is achievable given the plan’s investment policy and the types of assets held. The expected long-term rate of return is determined as of the measurement date. The Company reviews each plan and its historical returns and asset allocations to determine the appropriate expected long-term rate of return on plan assets to be used.

The Company’s investment objectives in managing its defined benefit plan assets are to ensure that present and future benefit obligations to all participants and beneficiaries are met as they become due; to provide a total return that, over the long term, minimizes required company contributions, at the appropriate levels of risk; and to meet any statutory requirements, laws and local regulatory agencies’ requirements. Key investment management decisions reviewed regularly are asset allocations, investment manager performance, investment advisors and trustees or custodians. Asset/liability modeling (ALM) studies are used as the basis for global asset allocation decisions and are updated as required.

The Company’s pension plans weighted-average asset allocations at December 31, 2008 and 2007, by asset category are as follows:


	2008						2007
Asset category	IR Plans		Trane Plans		Total Plans		Total Plans
Equity securities	37.5	%	52.5	%	41.0	%	54.0	%
Debt securities	54.6	%	43.3	%	52.0	%	38.4	%
Real estate	0.8	%	2.6	%	1.2	%	0.4	%
Other (including cash)	7.1	%	1.6	%	5.8	%	7.2	%
Total	100.0	%	100.0	%	100.0	%	100.0	%

The Company made contributions to its pension plans of $64.1 million in 2008, $25.5 million in 2007, and $31.6 million in 2006. The Company currently projects that it will be required to contribute approximately $105 million to its plans worldwide in 2009. The Company’s policy allows it to fund an amount, which could be in excess of or less than the pension cost expensed, subject to the limitations imposed by current tax regulations. The Company anticipates funding the plans in 2009 in accordance with contributions required by funding regulations or the laws of each jurisdiction.

Most of the Company’s U.S. employees are covered by savings and other defined contribution plans. Employer contributions are determined based on criteria specific to the individual plans and amounted to approximately $78.8 million (including $43.5 million for Trane plans), $47.8 million and $48.6 million in 2008, 2007 and 2006, respectively. The Company’s contributions relating to non-U.S. defined contribution plans and other non-U.S. benefit plans were $16.3 million (including $3.8 million for Trane plans), $11.4 million and $8.8 million in 2008, 2007 and 2006, respectively.

F-33

NOTE 16 – SHAREHOLDERS’ EQUITY

Common Stock

At December 31, 2008, a reconciliation of Class A Common shares is as follows:


In millions		Total
December 31, 2007		272.6
Shares issued under incentive plans		0.8
Merger consideration (See Note 3)		45.4
December 31, 2008		318.8

The increase from 2007 was a result of the issuance of 45.4 million IR-Limited Class A common shares to fund the equity portion of the consideration paid for the Trane acquisition.

During 2007, the Company repurchased 39.7 million Class A common shares at a cost of $1,999.9 million under the existing $4 billion share repurchase program. The program was originally authorized by the Board of Directors in December 2006 and expanded in May 2007. During 2006, the Company repurchased 27.7 million Class A common shares at a cost of $1,096.3 million, which completed the Company’s share repurchases under the $2 billion program that was authorized by the Board of Directors in August 2004 and expanded in August 2005.

Effective December 31, 2001, IR-Limited became the successor to IR-New Jersey, following the reorganization. The reorganization was accomplished through a merger of a newly formed merger subsidiary into IR-New Jersey. Upon consummation of the merger, the shares of IR-New Jersey common stock automatically became IR-Limited Class A common shares. As part of the reorganization, IR-New Jersey and certain of its subsidiaries, immediately prior to the merger, transferred shares of certain IR-New Jersey subsidiaries and issued certain debt in exchange for which IR-Limited issued 270,500,006 Class B common shares. The Class B common shares are non-voting and pay comparable dividends to the Class A common shares. The authorized share capital of IR-Limited is $1,175,010,000, consisting of (1) 1,175,000,000 common shares, par value $1.00 per share, which common shares consist of (a) 600,000,000 Class A common shares and (b) 575,000,000 Class B common shares, and (2) 10,000,000 preference shares, par value $0.001 per share. Class A common shares (and associated preference share purchase rights) were issued to holders of IR-New Jersey common stock in the merger. No preference shares were outstanding at December 31, 2008 or 2007. As the Class B common shares are owned by consolidated subsidiaries, the cost basis of the shares are eliminated in consolidation.

Accumulated Other Comprehensive (Loss) Income

The components of Accumulated other comprehensive income (loss) are as follows:


In millions	2008			2007
Foreign currency translation adjustment	$	437.0		$	675.8
Change in fair value of derivatives qualifying as cash flow hedges, net of tax		(2.4	)		(12.3	)
Unrealized loss on marketable securities, net of tax		(10.1	)		(3.7	)
Pension and postretirement obligation adjustments, net of tax		(875.3	)		(413.3	)
Accumulated other comprehensive income (loss)	$	(450.8	)	$	246.5

NOTE 17 – SHARE-BASED COMPENSATION

The Company records share-based compensation under the provisions of SFAS No. 123 (revised 2004), “Share-Based Payment,” which requires companies to measure all employee share-based compensation

F-34

awards using a fair value method and recognize compensation expense for an amount equal to the fair value of the share-based payment issued in its consolidated financial statements.

On June 6, 2007, the shareholders of the Company approved the Incentive Stock Plan of 2007, which authorizes the Company to issue stock options and other share-based incentives. The total number of shares authorized by the shareholders is 14.0 million, of which 8.8 million remains available as of December 31, 2008 for future incentive awards. The plan replaces the Incentive Stock Plan of 1998, which terminated in May 2007.

Stock Options

The average fair value of the stock options granted for the year ended December 31, 2008 and 2007 was estimated to be $11.56 per share and $11.06 per share, respectively, using the Black-Scholes option-pricing model. The following assumptions were used:


	2008		2007
Dividend yield	1.58	%	1.75	%
Volatility	31.48	%	26.10	%
Risk-free rate of return	2.95	%	4.71	%
Expected life	5.36 years		4.70 years

The fair value of each of the Company’s stock option awards is expensed on a straight-line basis over the required service period, which is generally the three-year vesting period of the options. However, for options granted to retirement eligible employees, the Company recognizes expense for the fair value of the options at the grant date. Expected volatility is based on the historical volatility from traded options on the Company’s stock. The risk-free rate of return is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the award is granted with a maturity equal to the expected term of the award. Historical data is used to estimate forfeitures within the Company’s valuation model. The Company’s expected life of the stock option awards is derived from historical experience and represents the period of time that awards are expected to be outstanding.

Changes in options outstanding under the plans for the years 2006, 2007 and 2008 are as follows:


	Shares subject to option		Weighted- average exercise price		Aggregate intrinsic value (millions)		Weighted- average remaining life
December 31, 2005	19,882,476			29.26
Granted	3,305,190			39.33
Exercised	(3,707,839	)		25.77
Cancelled	(314,885	)		38.82
December 31, 2006	19,164,942			31.54
Granted	3,528,225			43.77
Exercised	(5,386,093	)		29.70
Cancelled	(882,183	)		41.16
December 31, 2007	16,424,891			34.25
Granted	5,088,599			40.48
Trane options exchanged for IR options	7,408,134			18.50
Exercised	(685,508	)		26.56
Cancelled	(1,020,889	)		39.84
Outstanding December 31, 2008	27,215,227		$	31.11	$	26.6	5.4


Exercisable December 31, 2008	20,042,438		$	27.52	$	26.6	4.3

F-35

As part of the acquisition of Trane, 7.4 million Trane options were converted at the option of the holders into options to acquire shares of IR-Limited Class A common shares based on the option exchange ratio set forth in the merger agreement.

The following table summarizes information concerning currently outstanding and exercisable options:


				Options outstanding				Options exercisable
Range of exercise price				Number outstanding at December 31, 2008	Weighted- average remaining life	Weighted- average exercise price		Number exercisable at December 31, 2008	Weighted- average remaining life	Weighted- average exercise price
$ -	-	$	10.00	234,436	1.1	$	7.64	234,436	1.1	$	7.64
10.01	-		20.00	4,818,984	3.3		12.89	4,807,984	3.2		12.88
20.01	-		30.00	5,199,629	3.5		23.62	5,196,629	3.5		23.62
30.01	-		40.00	12,459,630	6.1		37.23	8,668,156	5.0		36.44
40.01	-		50.00	4,337,882	8.1		43.20	1,094,236	7.1		42.97
50.01	-		60.00	164,666	7.9		52.50	40,997	7.2		53.39
$ 3.25	-	$	55.22	27,215,227	5.4	$	31.11	20,042,438	4.3	$	27.52

At December 31, 2008, there was $38.2 million of total unrecognized compensation cost from stock option arrangements granted under the plan, which is related to unvested shares of non-retirement eligible employees. This compensation will be recognized over the required service period, which is generally the three-year vesting period. The aggregate intrinsic value of options exercised during the year ended December 31, 2008 and 2007 was $9.2 million and $103.4 million, respectively.

Generally, stock options vest ratably over a three-year period from their date of grant and expire at the end of ten years.

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SARs

SARs generally vest ratably over a three-year period from the date of grant and expire at the end of ten years. Effective August 2, 2006, all exercised SARs are settled with the Company’s Class A common shares. Previously exercised SARs were paid in cash. The following table summarizes the information for currently outstanding SARs:


	Shares subject to exercise		Weighted- average exercise price		Aggregate intrinsic value (millions)		Weighted- average remaining life
December 31, 2005	1,769,134		$	30.05
Granted	395,020			39.12
Exercised	(327,717	)		24.49
Cancelled	(142,683	)		32.18
December 31, 2006	1,693,754			33.11
Granted	-			-
Exercised	(476,400	)		30.31
Cancelled	(47,377	)		34.72
December 31, 2007	1,169,977			33.99
Granted	-			-
Exercised	(40,636	)		27.98
Cancelled	(55,869	)		37.85
Outstanding December 31, 2008	1,073,472		$	34.02	$	-	4.3


Exercisable December 31, 2008	990,222		$	33.56	$	-	4.2

Note: The Company did not grant SARS during 2007 and 2008 and does not anticipate further granting in the future.

Performance Shares

The Company has a Performance Share Program (PSP) for key employees. The program provides annual awards for the achievement of pre-established long-term strategic initiatives and annual financial performance of the Company. The annual target award level is expressed as a number of the Company’s Class A common shares. For performance year 2006 the award was paid in cash.

On April 17, 2007, and effective beginning in performance year 2007, the Compensation Committee of the Company’s board of directors approved a revision to the PSP program such that all PSP awards will be paid in Class A common shares rather than in cash. In addition, all shares will vest one year after the date of grant except for retirement-eligible employees whose shares vest immediately. As a result of these changes, a larger portion of the Company’s executive compensation program will be directly linked to the performance of the Company’s Class A common shares, thus further aligning the interests of executives with those of the Company’s shareholders.

Deferred Compensation

For fiscal years ended December 31, 2008 and before, the Company allowed key employees and non-employee directors to defer a portion of their eligible compensation into a number of investment choices, including Class A common share equivalents. Effective August 1, 2007, the deferred compensation plans were amended to provide that any amounts invested in the Class A common share equivalents will be settled in Class A common shares at the time of distribution. Previously, these amounts were settled in cash.

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Other Plans

The Company maintains a shareholder-approved Management Incentive Unit Award Plan. Under the plan, participating key employees were awarded incentive units. When dividends are paid on Class A common shares, phantom dividends are awarded to unit holders, one-half of which is paid in cash, the remaining half of which is credited to the participants’ account in the form of Class A common share equivalents. The value of the actual incentive units is never paid to participants, and only the fair value of accumulated common share equivalents is paid in cash upon the participants’ retirement. The number of common share equivalents credited to participants’ accounts at December 31, 2008 is 152,952.

The Company has issued stock grants as an incentive plan for certain key employees, with varying vesting periods. At December 31, 2008, there were 276,701 stock grants outstanding, all of which were vested. Effective August 2, 2006, all stock grants are settled with the Company’s Class A common shares rather than cash.

Compensation Expense

Share-based compensation expense is included in Selling and administrative expenses. The following table summarizes the expenses recognized:


In millions	2008			2007		2006
Stock options	$	39.5		$	21.4	$	13.6
SARs		(0.1	)		1.0		4.6
Performance shares		2.1			11.3		10.4
Deferred compensation		2.1			1.8		(0.6	)
Other		1.6			-		-
Pre-tax expense		45.2			35.5		28.0
Tax benefit		17.3			13.6		10.7
After tax expense	$	27.9		$	21.9	$	17.3



Amounts recorded in continuing operations	$	27.9		$	21.9	$	17.3
Amounts recorded in discontinued operations		-			3.9		2.8
Total	$	27.9		$	25.8	$	20.1

Compensation expense was recognized during the year ended December 31, 2006, for all share-based option awards granted since January 1, 2006, based on the grant date fair value in accordance with the provisions of SFAS 123(R). The Company recorded additional stock-option expense of $13.6 million in 2006 associated with the adoption of SFAS 123(R).

NOTE 18 – OTHER, NET

At December 31, the components of Other, net were as follows:


In millions	2008			2007			2006
Interest income	$	95.6		$	36.2		$	15.9
Exchange gain (loss)		(41.9	)		(2.8	)		(21.3	)
Minority interests		(20.0	)		(14.3	)		(14.9	)
Earnings from equity investments		3.4			1.0			(0.1	)
Other		6.1			(4.2	)		13.1
Other, net	$	43.2		$	15.9		$	(7.3	)

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NOTE 19 – INCOME TAXES

Earnings (loss) before income taxes for the years ended December 31 were taxed within the following jurisdictions:


In millions	2008			2007			2006
United States	$	(3,519.6	)	$	(140.4	)	$	35.2
Non-U.S.		743.6			1,077.9			822.4
Total	$	(2,776.0	)	$	937.5		$	857.6

Provision (benefit) for income taxes by jurisdiction for the years ended December 31 was as follows:


In millions	2008			2007		2006
United States	$	(281.2	)	$	52.8	$	(32.7	)
Non-U.S.		72.6			151.6		125.3
Total	$	(208.6	)	$	204.4	$	92.6

The components of Provision (benefit) for income taxes for the years ended December 31 were as follows:


In millions	2008			2007		2006
Current tax expense	$	125.4		$	57.8	$	64.8
Deferred tax expense (benefit)		(334.0	)		146.6		27.8
Total provision (benefit) for income taxes	$	(208.6	)	$	204.4	$	92.6

The Provision (benefit) for income taxes differs from the amount of income taxes determined by applying the applicable U.S. statutory income tax rate to pretax income, as a result of the following differences:


	Percent of pretax income
	2008		2007		2006
Statutory U.S. rate	35.0	%	35.0	%	35.0	%
Increase (decrease) in rates resulting from:
Non-U.S. operations	9.4		(21.0	)	(28.2	)
Manufacturing exemption/ETI/FSC	0.1		(0.9	)	(0.5	)
State and local income taxes, net of U.S. tax	(0.3	)	(0.1	)	(0.5	)
Non-deductible impairment charge	(35.1	)	-		-
Tax reserves (including uncertain tax position reserves)*	(2.5	)	8.0		4.8
Other adjustments	0.9		0.8		0.2
Effective tax rate	7.5	%	21.8	%	10.8	%

Tax incentives, in the form of tax holidays, have been granted in certain jurisdictions to encourage industrial development. The expiration of these tax holidays varies by country. The most significant tax holiday relates to the Company’s qualifying locations in Ireland, which were granted a 10% tax rate through 2010. The benefit for the tax holidays for the year ended December 31, 2008 and 2007 was $4.1 million and $4.9 million, respectively.

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At December 31, a summary of the deferred tax accounts were as follows:


In millions	2008			2007
Deferred tax assets:
Inventory and accounts receivable	$	29.3		$	24.0
Fixed assets and intangibles		23.5			11.4
Postemployment and other benefit liabilities		833.8			468.5
Product liability		324.8			199.3
Other reserves and accruals		198.4			135.6
Net operating losses and credit carryforwards		750.2			445.7
Other		248.8			46.6
Gross deferred tax assets		2,408.8			1,331.1
Less: deferred tax valuation allowances		(247.8	)		(207.4	)
Deferred tax assets net of valuation allowances	$	2,161.0		$	1,123.7
Deferred tax liabilities:
Inventory and accounts receivable	$	(60.0	)	$	(11.6	)
Fixed assets and intangibles		(2,368.4	)		(511.4	)
Postemployment and other benefit liabilities		(7.5	)		(39.0	)
Other reserves and accruals		(5.8	)		(11.7	)
Other		(77.5	)		(8.3	)
Gross deferred tax liability		(2,519.2	)		(582.0	)

Net deferred tax assets (liabilities)	$	(358.2	)	$	541.7

The increase in the valuation allowance of $40.4 million was recorded for U.S. federal tax credit carryforwards, U.S. state net operating loss carryforwards, non-U.S net operating loss and credit carryforwards and other non-US deferred tax assets.

At December 31, 2008, no deferred taxes have been provided for any portion of the $5.7 billion of undistributed earnings of the Company’s subsidiaries, since these earnings have been, and under current plans will continue to be, permanently reinvested in these subsidiaries, and it is not practicable to estimate the amount of additional taxes which may be payable upon distribution.

At December 31, 2008, the Company had the following operating loss and tax credit carryforwards available to offset taxable income in prior and future years:


In millions	Amount		Expiration Period
U.S. Federal net operating loss carryforwards	$	1,137.7	2009-2028
U.S. Federal credit carryforwards		166.8	2011-2028
U.S. State net operating loss carryforwards		2,679.0	2009-2028
Non-U.S. net operating loss carryforwards		932.6	2009-Unlimited
Non-U.S. credit carryforwards		12.1	Unlimited

The U.S. state net operating loss carryforwards were incurred in various jurisdictions. The non-U.S. net operating loss carryforwards were incurred in various jurisdictions, predominately in Brazil, Germany, Hong Kong, Netherlands, Spain, Switzerland and the United Kingdom.

Effective January 1, 2007, the Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement 109” (FIN 48), which prescribes a

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recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return. Additionally, FIN 48 provides guidance on the recognition, classification, accounting in interim periods and disclosure requirements for uncertain tax positions. As a result of adopting FIN 48, the company recorded additional liabilities to its previously established reserves, and a corresponding decrease in retained earnings of $145.6 million.

The Company has total unrecognized tax benefits of $589.6 million and $379.8 million as of December 31, 2008, and December 31, 2007, respectively. The amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate are $490.6 million as of December 31, 2008. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:


In millions	2008			2007
Balance at December 31, 2007	$	379.8		$	457.0
Additions based on tax positions related to the current year		28.8			22.5
Additions based on tax positions related to acquisitions		190.4			-
Additions based on tax positions related to prior years		60.7			75.5
Reductions based on tax positions related to prior years		(65.0	)		(33.6	)
Reductions related to settlements with tax authorities		(1.3	)		(141.0	)
Reductions related to lapses of statute of limitations		(3.8	)		(0.6	)
Balance at December 31, 2008	$	589.6		$	379.8

In connection with Trane’s spin-off of WABCO, Trane and WABCO entered into a tax sharing agreement for the allocation of pre spin-off taxes. Of the total unrecognized tax benefit of $588.9 million at December 31, 2008, WABCO has agreed to indemnify Trane for $43.3 million, which is reflected in an other long term receivable account.

The Company records interest and penalties associated with the uncertain tax positions within its Provision for income taxes. The Company had reserves associated with interest and penalties, net of tax, of $91.3 million and $93.1 million at December 31, 2008, and December 31, 2007, respectively. For the year ended December 31, 2008 and December 31, 2007, the Company recognized $12.7 million and $8.0 million, respectively, in interest and penalties net of tax related to these uncertain tax positions.

It is reasonably possible that the total amount of unrecognized tax benefits could change within 12 months as a result of settlements of ongoing tax examinations resulting in a decrease of approximately $68.3 million in the unrecognized tax benefits.

F-41

The Company strongly disagrees with the view of the IRS and filed a protest with the IRS in the third quarter of 2007. The Company has and intends to continue to vigorously contest these proposed adjustments. The Company, in consultation with its outside advisors, carefully considered many factors in determining the terms of the intercompany debt, including the obligor’s ability to service the debt and the availability of equivalent financing from unrelated parties, two factors prominently cited by the IRS in denying debt treatment. The Company believes that its characterization of that obligation as debt for tax purposes was supported by the relevant facts and legal authorities at the time of its creation. The subsequent financial results of the relevant companies, including the actual cash flow generated by operations and the production of significant additional cash flow from dispositions, have confirmed the ability to service this debt. Although the outcome of this matter cannot be predicted with certainty, based upon an analysis of the strength of its position, the Company believes that it is adequately reserved for this matter. As the Company moves forward to resolve this matter with the IRS, it is reasonably possible that the reserves established may be adjusted within the next 12 months. However, the Company does not expect that the ultimate resolution will have a material adverse impact on its future results of operations or financial position.

F-42

NOTE 20 – DIVESTITURES AND DISCONTINUED OPERATIONS

The components of discontinued operations for the years ended December 31 are as follows:


In millions	2008			2007			2006
Revenues	$	15.3		$	2,957.8		$	3,375.7



Pre-tax earnings (loss) from operations		(50.3	)		(82.5	)		376.6
Pre-tax gain (loss) on sale		(5.2	)		4,382.6			1.1
Tax benefit (expense)		(1.9	)		(1,066.5	)		(110.2	)
Discontinued operations, net	$	(57.4	)	$	3,233.6		$	267.5

Pre-tax loss from operations in 2007 includes a non-cash charge of $449.0 million related to the Company’s liability for all pending and estimated future asbestos claims through 2053 as discussed below in “Other Discontinued Operations”.

Discontinued operations by business for the years ended December 31 are as follows:


In millions	2008			2007			2006
Compact Equipment, net of tax	$	(11.7	)	$	2,927.1		$	240.4
Road Development, net of tax		(29.8	)		672.5			62.9
Other discontinued operations, net of tax		(15.9	)		(366.0	)		(35.8	)
Total discontinued operations, net of tax	$	(57.4	)	$	3,233.6		$	267.5

Compact Equipment Divestiture

On July 29, 2007, the Company agreed to sell its Bobcat, Utility Equipment and Attachments businesses (collectively, Compact Equipment) to Doosan Infracore for gross proceeds of approximately $4.9 billion, subject to post-closing purchase price adjustments. The sale was completed on November 30, 2007. We are currently in the process of resolving the final purchase price adjustments with Doosan Infracore.

Compact Equipment manufactured and sold compact equipment, including skid-steer loaders, compact track loaders, mini-excavators and telescopic tool handlers; portable air compressors, generators and light towers; general-purpose light construction equipment; and attachments. The Company has accounted for Compact Equipment as discontinued operations and has classified the assets and liabilities as held for sale for all periods presented in accordance with Statement of Financial Accounting Standard No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (SFAS 144).

Net revenues and after-tax earnings of Compact Equipment for the years ended December 31 were as follows:


In millions	2008			2007		2006
Net revenues	$	15.3		$	2,705.9	$	2,648.4


After-tax earnings (loss) from operations	$	(0.6	)	$	275.1	$	240.4
Gain (loss) on sale, net of tax		(11.1	)		2,652.0		-
Total discontinued operations, net of tax	$	(11.7	)	$	2,927.1	$	240.4

Road Development Divestiture

On February 27, 2007, the Company agreed to sell its Road Development business unit to AB Volvo (publ) for cash proceeds of approximately $1.3 billion. The sale was completed on April 30, 2007.

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The Road Development business unit manufactured and sold asphalt paving equipment, compaction equipment, milling machines and construction-related material handling equipment. The Company has accounted for the Road Development business unit as discontinued operations and has classified the assets and liabilities sold to AB Volvo as held for sale for all periods presented in accordance with SFAS 144.

Net revenues and after-tax earnings of the Road Development business unit for the years ended December 31 were as follows:


In millions	2008			2007		2006
Net revenues	$	-		$	251.9	$	727.3



After-tax earnings from operations	$	(0.4	)	$	37.8	$	62.9
Gain on sale, net of tax		(29.4	)		634.7		-
Total discontinued operations, net of tax	$	(29.8	)	$	672.5	$	62.9

Other Discontinued Operations

The Company also has retained costs from previously sold businesses that mainly include costs related to postretirement benefits, product liability and legal costs (mostly asbestos-related). The components of other discontinued operations for the years ended December 31 were as follows:


In millions	2008			2007			2006
Retained costs, net of tax	$	(16.7	)	$	(340.9	)	$	(36.5	)
Net gain (loss) on disposals, net of tax		0.8			(25.1	)		0.7
Total discontinued operations, net of tax	$	(15.9	)	$	(366.0	)	$	(35.8	)

During the fourth quarter of 2007, the Company recorded a non-cash charge of $449.0 million ($277 million after-tax) related to the Company’s liability for all pending and estimated future asbestos claims through 2053. Refer to Note 22 for further details on asbestos-related matters.

NOTE 21 – EARNINGS PER SHARE (EPS)

Basic EPS is calculated by dividing net earnings (income available to common shareholders) by the weighted-average number of Class A common shares outstanding for the applicable period. Diluted EPS is calculated after adjusting the denominator of the basic EPS calculation for the effect of all potentially dilutive common shares, which in the Company’s case, includes shares issuable under share-based compensation plans. The following table summarizes the weighted-average number of Class A common shares outstanding for basic and diluted earnings per share calculations:


In millions	2008	2007	2006
Weighted-average number of basic shares	300.6	290.7	319.9
Shares issuable under incentive stock plans	3.1	4.6	3.2
Weighted-average number of diluted shares	303.7	295.3	323.1


Anti-dilutive shares	27.7	0.2	3.2

As the Company experienced a net loss in 2008, the Company has not included the impact of shares issuable under incentive stock plans in the calculation of diluted EPS as the result would have an antidilutive effect on EPS.

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NOTE 22 – COMMITMENTS AND CONTINGENCIES

The Company is involved in various litigations, claims and administrative proceedings, including those related to environmental and product liability matters. Amounts recorded for identified contingent liabilities are estimates, which are reviewed periodically and adjusted to reflect additional information when it becomes available. Subject to the uncertainties inherent in estimating future costs for contingent liabilities, management believes that the liability which may result from these legal matters would not have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

Environmental Matters

The Company continues to be dedicated to an environmental program to reduce the utilization and generation of hazardous materials during the manufacturing process and to remediate identified environmental concerns. As to the latter, the Company is currently engaged in site investigations and remediation activities to address environmental cleanup from past operations at current and former manufacturing facilities.

The Company is sometimes a party to environmental lawsuits and claims and has received notices of potential violations of environmental laws and regulations from the Environmental Protection Agency and similar state authorities. It has also been identified as a potentially responsible party (PRP) for cleanup costs associated with off-site waste disposal at federal Superfund and state remediation sites. For all such sites, there are other PRPs and, in most instances, the Company’s involvement is minimal.

In estimating its liability, the Company has assumed it will not bear the entire cost of remediation of any site to the exclusion of other PRPs who may be jointly and severally liable. The ability of other PRPs to participate has been taken into account, based generally on the parties’ financial condition and probable contributions on a per site basis. Additional lawsuits and claims involving environmental matters are likely to arise from time to time in the future.

During 2008, we spent $6.9 million on capital projects for pollution abatement and control, and an additional $15.5 million for environmental remediation expenditures at sites presently or formerly owned or leased by us. As of December 31, 2008, the Company has recorded reserves for environmental matters of $100.9 million. The Company believes that these expenditures and accrual levels will continue and may increase over time. Given the evolving nature of environmental laws, regulations and technology, the ultimate cost of future compliance is uncertain.

Asbestos Matters

F-45

•

ARPC’s interpretation of a widely accepted forecast of the population likely to have been occupationally exposed to asbestos;

•

epidemiological studies estimating the number of people likely to develop asbestos-related diseases such as mesothelioma and lung cancer;

•

an analysis of the Company’s pending cases, by type of disease claimed;

•

an analysis of the Company’s most recent three-year history to determine the average settlement and resolution value of claims, by type of disease claimed;

•

an analysis of the period over which the Company has and is likely to resolve asbestos-related claims against it in the future.

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not discounted for the time-value of money, and excludes the Company’s defense fees (which will continue to be expensed by the Company as they are incurred). After considering ARPC’s analysis and the factors listed above, in the fourth quarter of 2007, the Company increased its recorded liability for asbestos claims by $538 million, from $217 million to $755 million.

F-47

agreement with Mt. McKinley Insurance Company and Everest Reinsurance Company, both members of the Everest Re group, resolving all claims in the NJ Litigation involving policies issued by those companies (“Everest Re Agreement”). The Everest Re Agreement contains a number of elements, including policy buy-outs and partial buy-outs in exchange for a cash payment along with coverage-in-place features similar to those contained in the August 26 Agreement, in exchange for certain releases and indemnifications by Trane. More recently, on January 26, 2009, Trane entered into a coverage-in-place agreement with Columbia Casualty Company, Continental Casualty Company, and Continental Insurance Company in its own capacity and as successor-in-interest to Harbor Insurance Company and London Guarantee & Accident Company of New York (“CNA Agreement”). The CNA Agreement provides for the reimbursement by the insurer signatories of a portion of Trane’s costs for indemnification from Trane. Trane remains in settlement negotiations with the insurer defendants in the NJ Litigation not encompassed within the August 26 Agreement, Everest Re Agreement, and the CNA Agreement. Once concluded, we believe NJ Litigation will resolve coverage issues with respect to approximately 95% of Trane’s recorded insurance receivable in connection with asbestos-related liabilities.

F-48


	2006		2007		2008
Open claims - January 1	102,968		101,709		100,623
New claims filed	6,457		5,398		4,567
Claims settled	(6,558	)	(5,005	)	(3,693	)
Claims dismissed *	(1,158	)	(1,479	)	(38,189	)
Open claims - December 31	101,709		100,623		63,308

The table below provides additional information regarding asbestos-related claims filed against the legacy Trane businesses, reflecting updated information for the last three years.


	2006		2007		2008
Open claims - January 1	113,730		104,570		105,023
New claims filed	4,440		3,019		3,626
Claims settled	(848	)	(740	)	(600	)
Claims dismissed	(12,752	)	(1,826	)	(9,710	)
Open claims - December 31	104,570		105,023		98,339

The (costs) income associated with the settlement and defense of asbestos related claims after insurance recoveries were as follows:


	December 31,
In millions	2008			2007
Continuing operations	$	(1.5	)	$	-
Discontinued operations		(5.9	)		(311.3	)
Total	$	(7.4	)	$	(311.3	)

F-49

The European Commission Investigation

Other Matters

F-50

announced it had reached settlements with the SEC and DOJ relating to this matter. Under the terms of the settlements, the Company paid a total of $6.7 million in penalties, interest and disgorgement of profits. The Company has consented to the entry of a civil injunction in the SEC action and has entered into a three-year deferred prosecution agreement (DPA) with the DOJ. Under both settlements, the Company has implemented and will continue to implement improvements to its compliance program that are consistent with its longstanding policy against improper payments. In the settlement documents, the Government noted that the Company thoroughly cooperated with the investigation, that the Company had conducted its own complete investigation of the conduct at issue, promptly and thoroughly reported its findings to them, and took prompt remedial measures.

The following represents the changes in the Company’s product warranty liability for 2008 and 2007:


In millions	2008			2007
Balance at beginning of year	$	146.9		$	137.1
Reductions for payments		(207.7	)		(68.5	)
Accruals for warranties issued during the current period		246.7			80.1
Changes for accruals related to preexisting warranties		(22.9	)		(7.8	)
Acquisitions		483.3			-
Translation		(5.6	)		6.0
Balance at end of the year	$	640.7		$	146.9

Certain office and warehouse facilities, transportation vehicles and data processing equipment are leased by the Company. Total rental expense was $144.8 million in 2008, $72.2 million in 2007 and $68.2 million in 2006. Minimum lease payments required under non-cancelable operating leases with terms in excess of one year for the next five years and thereafter, are as follows: $169.9 million in 2009, $130.8 million in 2010, $102.3 million in 2011, $77.7 million in 2012, $64.3 million in 2013 and $102.5 million thereafter.

Trane has commitments and performance guarantees, including energy savings guarantees, totaling $108.4 million extending from 2008-2028. These guarantees are provided under long-term service and

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maintenance contracts related to its air conditioning equipment and system controls. Through 2008, the Company has experienced one insignificant loss under such arrangements and considers the probability of any significant future losses to be remote.

The Company also has other contingent liabilities of $5.1 million. These liabilities primarily result from performance bonds, guarantees and stand-by letters of credit associated with the prior sale of products from divested businesses.

Public debt securities issued by IR Global Holding Company Limited are fully and unconditionally guaranteed by IR-Limited. No other subsidiary of ours guarantees these securities.

NOTE 23 – FAIR VALUE MEASUREMENTS

Effective January 1, 2008, the Company adopted SFAS No. 157, “Fair Value Measurements,” (SFAS 157). SFAS 157 establishes a framework for measuring fair value that is based on the inputs market participants use to determine the fair value of an asset or liability and establishes a fair value hierarchy to prioritize those inputs. The fair value hierarchy outlined in SFAS 157 is comprised of three levels that are described below:

•

Level 1 – Inputs based on quoted prices in active markets for identical assets or liabilities.

•

Level 2 – Inputs other than Level 1 quoted prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.

•

Level 3 – Unobservable inputs based on little or no market activity and that are significant to the fair value of the assets and liabilities.

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs are obtained from independent sources and can be validated by a third party, whereas unobservable inputs reflect assumptions regarding what a third party would use in pricing an asset or liability based on the best information available under the circumstances. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Effective February 12, 2008, the Company adopted FASB Staff Position SFAS 157-2, “Effective Date of FASB Statement No. 157,” which defers the application date of the provisions of SFAS 157 for all nonfinancial assets and liabilities except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Due to the deferral, the Company has delayed its implementation of the SFAS 157 provisions on the fair value of goodwill, indefinite-lived intangible assets and nonfinancial long-lived assets.

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Assets and liabilities measured at fair value on a recurring basis at December 31, 2008 are as follows:


	Fair value measurements						Total Fair value
In millions	Level 1		Level 2		Level 3		Total Fair value
Assets:
Cash and cash equivalents	$	550.2	$	-	$	-	$	550.2
Marketable securities		6.5		-		-		6.5
Derivative instruments		-		25.9		-		25.9
Securitization		-		-		83.6		83.6
Benefit trust assets		24.1		131.1		-		155.2
Total	$	580.8	$	157.0	$	83.6	$	821.4

Liabilities:
Derivative instruments	$	-	$	56.7	$	-	$	56.7
Benefit liabilities		21.5		175.4		-		196.9
Total	$	21.5	$	232.1	$	-	$	253.6

SFAS 157 defines fair value as the exchange price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company determines the fair value of its financial assets and liabilities using the following methodologies:

•

Cash and cash equivalents – These amounts include cash on hand, demand deposits and all highly liquid investments with original maturities at the time of purchase of three months or less and are held in U.S and non-U.S. currencies.

•

Marketable securities – These securities include investments in publically traded stock of non-U.S. companies held by non-U.S. subsidiaries of the Company. The fair value is obtained for the securities based on observable market prices quoted on public stock exchanges.

•

Derivatives instruments – These instruments include forward contracts related to non-U.S. currencies, commodities and a cross-currency swap of foreign denominated debt. The fair value of the derivative instruments are determined based on a pricing model that uses inputs from actively quoted currency and commodity markets that are readily accessible and observable.

•

Benefit trust assets – These assets include money market funds and insurance contracts that are the underlying for the benefit assets. The fair value of the assets is based on observable market prices quoted in a readily accessible and observable market.

•

Securitization – This asset is the interest the Company retains in receivables sold into a special purpose entity. The fair value of the asset is based on a model that requires unobservable inputs.

•

Benefit liabilities – These liabilities include deferred compensation and executive death benefits. The fair value is based on the underlying investment portfolio of the deferred compensation and the specific benefits guaranteed in a death benefit contract with each executive.

Effective January 1, 2008, the Company also adopted SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an amendment of FASB Statement No. 115,”

F-53

(SFAS 159). SFAS 159 allows the Company the irrevocable option, at specified election dates, to measure financial assets and liabilities at their current fair value, with the corresponding changes in fair value from period to period recognized in the income statement. As of December 31, 2008, the Company has not elected to utilize the fair value option on any of its financial assets or liabilities.

NOTE 24 – BUSINESS SEGMENT INFORMATION

The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies except that the operating segments’ results are prepared on a management basis that is consistent with the manner in which the Company disaggregates financial information for internal review and decision making. The Company largely evaluates performance based on operating income and operating margins. Intercompany sales between segments are considered immaterial.

The Company has divested various businesses over the past few years as it moves to being a leading global diversified industrial enterprise. During 2007, the Company sold its Bobcat, Utility Equipment and Attachments business units as well as its Road Development business unit. Segment information for all years has been revised to exclude the results of these divestitures.

Each reportable segment is based primarily on the types of products it generates. The operating segments have been aggregated as required by SFAS No. 131, “Disclosures About Segments of an Enterprise and Related Information.” A description of the Company’s reportable segments is as follows:

The Air Conditioning Systems and Service segment provides heating, ventilation and air conditioning (HVAC) systems that enhance the quality and comfort of the air in homes and buildings around the world. It offers customers a broad range of energy-efficient HVAC systems, dehumidifying and air cleaning products, service and parts support, advanced building controls as well as financing solutions under the American Standard Heating and Air Conditioning and Trane brands. These brands have leading positions in commercial, residential, institutional and industrial markets.

The Climate Control Technologies segment provides equipment and services to manage controlled-temperature environments for food and other perishables throughout the world. Encompassing the transport and stationary refrigeration markets, this segment offers customers a broad range of products and solutions such as refrigerated display merchandisers, beverage coolers, auxiliary power units, walk-in storage coolers and freezers and transport temperature control units. This segment includes the market leading brands of Hussmann and Thermo King.

The Industrial Technologies segment provides products, services and solutions that enhance energy efficiency, productivity and operations. It offers our global customers a diverse and innovative range of products including compressed air systems, tools, pumps, fluid handling systems, golf and utility vehicles in addition to environmentally friendly micro turbines. This segment includes the Club Car and Ingersoll Rand market leading brands.

The Security Technologies segment is a leading global provider of products and services that make environments safe, secure and productive. The segment’s market-leading products include electronic and biometric access control systems, locks and locksets, door closers, floor closers, exit devices, steel doors and frames, portable security devices, decorative hardware, cabinet hardware as well as time, attendance and personnel scheduling systems. These products serve a wide range of markets including the commercial and residential housing market, healthcare, retail, maritime, transport industries as well as educational and governmental facilities. This segment includes the CISA, LCN, Schlage and Von Duprin brands.

F-54

A summary of operations by reportable segments for the years ended December 31, were as follows:


Dollar amounts in millions	2008			2007			2006
Air Conditioning Systems and Services
Revenues	$	4,401.3		$	-		$	-
Operating income (loss)		(3,145.7	)		-			-
Operating income as a percentage of revenues		-71.5%			-			-
Depreciation and amortization		275.6			-			-
Capital expenditures		112.5			-			-

Climate Control Technologies
Revenues		3,356.8			3,372.4			3,171.0
Operating income		278.9			382.6			356.0
Operating income as a percentage of revenues		8.3%			11.3%			11.2%
Depreciation and amortization		49.6			48.9			52.1
Capital expenditures		64.8			38.9			25.6

Industrial Technologies
Revenues		2,938.3			2,877.1			2,577.7
Operating income		353.7			392.0			351.8
Operating income as a percentage of revenues		12.0%			13.6%			13.6%
Depreciation and amortization		41.6			36.2			32.4
Capital expenditures		52.9			41.2			55.6

Security Technologies
Revenues		2,531.0			2,513.6			2,285.0
Operating income		100.4			433.5			400.2
Operating income as a percentage of revenues		4.0%			17.2%			17.5%
Depreciation and amortization		47.5			46.6			42.6
Capital expenditures		54.7			34.4			43.6
Total revenues	$	13,227.4		$	8,763.1		$	8,033.7

Operating income (loss) from reportable segments		(2,412.7	)		1,208.1			1,108.0
Unallocated corporate expense		(161.1	)		(150.3	)		(109.5	)
Total operating income (loss)	$	(2,573.8	)	$	1,057.8		$	998.5
Total operating income (loss) as a percentage of revenues		-19.5%			12.1%			12.4%

Depreciation and amortization from reportable segments		414.3			131.7			127.1
Unallocated depreciation and amortization		38.8			7.1			21.7
Total depreciation and amortization	$	453.1		$	138.8		$	148.8

Capital expenditures from reportable segments		284.9			114.5			124.8
Corporate capital expenditures		21.1			5.2			20.0
Total capital expenditures	$	306.0		$	119.7		$	144.8

F-55

Revenues by destination and long-lived assets by geographic area for the years ended December 31 were as follows:


In millions	2008		2007		2006
Revenues
United States	$	7,709.4	$	4,756.0	$	4,570.9
Non-U.S.		5,518.0		4,007.1		3,462.8
Total	$	13,227.4	$	8,763.1	$	8,033.7


In millions	2008		2007
Long-lived assets
United States	$	3,706.3	$	820.5
Non-U.S.		753.9		639.6
Total	$	4,460.2	$	1,460.1

NOTE 25 – GUARANTOR FINANCIAL INFORMATION

Ingersoll-Rand Company Limited, a Bermuda company (IR-Limited) is the successor to Ingersoll-Rand Company, a New Jersey corporation (IR-New Jersey), following a corporate reorganization (the reorganization) that became effective on December 31, 2001. The reorganization was accomplished through a merger of a newly formed subsidiary of IR-Limited. IR-Limited and its subsidiaries continue to conduct the businesses previously conducted by IR-New Jersey and its subsidiaries. The reorganization has been accounted for as a reorganization of entities under common control and accordingly, did not result in any changes to the consolidated amounts of assets, liabilities and shareholders’ equity.

As part of the reorganization, IR-Limited guaranteed all of the issued public debt securities of IR-New Jersey. The subsidiary issuer, IR-New Jersey, is 100% owned by the parent, IR-Limited, the guarantees are full and unconditional, and no other subsidiary of the Company guarantees the securities.

IR-Limited issued Class B common shares to IR-New Jersey in exchange for a $3.6 billion note and shares of certain IR-New Jersey subsidiaries. The note, which is due in 2011, has a fixed rate of interest of 11% per annum payable semi-annually and imposes certain restrictive covenants upon IR-New Jersey. At December 31, 2008, $1.0 billion of the original $3.6 billion note remains outstanding. The Class B common shares are non-voting and pay dividends comparable to the Class A common shares. In 2002, IR-Limited contributed the note to a wholly owned subsidiary, which subsequently transferred portions of the note to several other subsidiaries, all of which are included in the “Other Subsidiaries” below. Accordingly, the subsidiaries of IR-Limited remain creditors of IR-New Jersey.

IR-New Jersey has unconditionally guaranteed payment of the principal, premium, if any, and interest on the Company’s 4.75% Senior Notes due in 2015 in the aggregate principal amount of $300 million. The guarantee is unsecured and provided on an unsubordinated basis. The guarantee ranks equally in right of payment with all of the existing and future unsecured and unsubordinated debt of IR-New Jersey.

The Company has revised the guarantor financial statements for all periods presented in order to reflect Ingersoll-Rand Global Holding Company Limited (IR Global Holding) as a stand-alone subsidiary. IR Global Holding, a 100% owned subsidiary of IR-Limited, issued public debt that is guaranteed by IR-Limited. As part of the process to revise the condensed financial statements, the Company noted errors within the consolidation process of the subsidiaries. Total consolidated results were not impacted

F-56

by these revisions; however, certain amounts reported within the IR-New Jersey and Other Subsidiary columns have been corrected. The Company determined that these errors were immaterial to the Company’s financial statements. All periods have been revised in the current presentation.

The condensed consolidating financial statements present IR-Limited, IR Global Holding and IR-New Jersey investments in their subsidiaries using the equity method of accounting. Intercompany investments in the non-voting Class B common shares are accounted for on the cost method and are reduced by intercompany dividends. In accordance with generally accepted accounting principles, the amounts related to the issuance of the Class B shares have been presented as contra accounts and included within Other Shareholders’ Equity since the Class B issuance on December 31, 2001. The notes payable continue to be reflected as a liability on the balance sheet of IR-New Jersey and are enforceable in accordance with their terms.

See Note 12 and 22 for a further discussion on the public debt issuance and related guarantees.

The following condensed consolidated financial information for IR-Limited, IR Global Holding, IR-New Jersey, and all their other subsidiaries is included so that separate financial statements of IR Global Holding and IR-New Jersey are not required to be filed with the U.S. Securities and Exchange Commission.

Condensed Consolidating Income Statement

For the year ended December 31, 2008


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			Consolidating Adjustments		IR Limited Consolidated
Net revenues	$	—		$	—		$	898.5		$	12,328.9		$	—	$	13,227.4
Cost of goods sold		—			—			(664.3	)		(9,083.8	)		—		(9,748.1	)
Selling and administrative expenses		(41.7	)		(0.5	)		(292.0	)		(2,008.9	)		—		(2,343.1	)
Asset impairment		—			—			—			(3,710.0	)		—		(3,710.0	)
Operating (loss) income		(41.7	)		(0.5	)		(57.8	)		(2,473.8	)		—		(2,573.8	)
Equity earnings in affiliates (net of tax)		(2,459.4	)		(1,257.3	)		118.6			(279.5	)		3,877.6		—
Interest expense		(15.5	)		(108.9	)		(73.2	)		(47.8	)		—		(245.4	)
Intercompany interest and fees		(95.8	)		(168.2	)		(353.9	)		617.9			—		—
Other, net		(17.1	)		26.9			102.9			(69.5	)		—		43.2
Earnings (loss) before income taxes		(2,629.5	)		(1,508.0	)		(263.4	)		(2,252.7	)		3,877.6		(2,776.0	)
Benefit (provision) for income taxes		—			(0.6	)		67.4			141.8			—		208.6
Earnings (loss) from continuing operations		(2,629.5	)		(1,508.6	)		(196.0	)		(2,110.9	)		3,877.6		(2,567.4	)
Discontinued operations, net of tax		4.7			—			(83.5	)		21.4			—		(57.4	)
Net earnings (loss)	$	(2,624.8	)	$	(1,508.6	)	$	(279.5	)	$	(2,089.5	)	$	3,877.6	$	(2,624.8	)

F-57

Condensed Consolidating Income Statement

For the year ended December 31, 2007


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			Consolidating Adjustments			IR Limited Consolidated
Net revenues	$	-		$	-		$	911.9		$	7,851.2		$	-		$	8,763.1
Cost of goods sold		-			-			(629.2	)		(5,642.8	)		-			(6,272.0	)
Selling and administrative expenses		(32.7	)		(0.6	)		(302.3	)		(1,097.7	)		-			(1,433.3	)
Operating (loss) income		(32.7	)		(0.6	)		(19.6	)		1,110.7			-			1,057.8
Equity earnings in affiliates (net of tax)		4,038.4			3,234.2			873.1			765.2			(8,910.9	)		-
Interest expense		(39.8	)		-			(69.9	)		(26.5	)		-			(136.2	)
Intercompany interest and fees		(53.8	)		(155.4	)		(684.0	)		893.2			-			-
Other, net		54.6			2.9			71.4			(113.0	)		-			15.9
Earnings (loss) before income taxes		3,966.7			3,081.1			171.0			2,629.6			(8,910.9	)		937.5
Benefit (provision) for income taxes		-			-			167.8			(372.2	)		-			(204.4	)
Earnings (loss) from continuing operations		3,966.7			3,081.1			338.8			2,257.4			(8,910.9	)		733.1
Discontinued operations, net of tax		-			-			426.4			2,807.2			-			3,233.6
Net earnings (loss)	$	3,966.7		$	3,081.1		$	765.2		$	5,064.6		$	(8,910.9	)	$	3,966.7

Condensed Consolidating Income Statement

For the year ended December 31, 2006


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			Consolidating Adjustments			IR Limited Consolidated
Net revenues	$	-		$	-		$	922.0		$	7,111.7		$	-		$	8,033.7
Cost of goods sold		-			-			(658.7	)		(5,109.7	)		-			(5,768.4	)
Selling and administrative expenses		(16.3	)		(0.9	)		(252.3	)		(997.3	)		-			(1,266.8	)
Operating (loss) income		(16.3	)		(0.9	)		11.0			1,004.7			-			998.5
Equity earnings in affiliates (net of tax)		1,057.6			889.0			410.9			(37.3	)		(2,320.2	)		-
Interest expense		(30.3	)		-			(77.6	)		(25.7	)		-			(133.6	)
Intercompany interest and fees		(32.9	)		(76.0	)		(644.2	)		753.1			-			-
Other, net		54.4			1.9			64.2			(127.8	)		-			(7.3	)
Earnings (loss) before income taxes		1,032.5			814.0			(235.7	)		1,567.0			(2,320.2	)		857.6
Benefit (provision) for income taxes		-			-			192.1			(284.7	)		-			(92.6	)
Earnings (loss) from continuing operations		1,032.5			814.0			(43.6	)		1,282.3			(2,320.2	)		765.0
Discontinued operations, net of tax		-			-			6.3			261.2			-			267.5
Net earnings (loss)	$	1,032.5		$	814.0		$	(37.3	)	$	1,543.5		$	(2,320.2	)	$	1,032.5

F-58

Condensed Consolidating Balance Sheet

December 31, 2008


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			Consolidating Adjustments			IR Limited Consolidated
Current assets:
Cash and cash equivalents	$	-		$	1.1		$	8.6		$	540.5		$	-		$	550.2
Accounts and notes receivable, net		-			-			224.7			2,203.8			-			2,428.5
Inventories		-			-			71.4			1,543.7			-			1,615.1
Other current assets		5.0			3.3			166.5			631.1			-			805.9
Accounts and notes receivable affiliates		433.1			1,911.5			4,367.1			36,804.3			(43,516.0	)		-
Total current assets		438.1			1,915.9			4,838.3			41,723.4			(43,516.0	)		5,399.7

Investment in affiliates		10,093.7			12,337.4			7,420.0			65,156.2			(95,007.3	)		-
Property, plant and equipment, net		-			-			161.9			1,806.6			-			1,968.5
Intangible assets, net		-			-			72.6			11,761.6			-			11,834.2
Other noncurrent assets		(3.0	)		12.1			742.3			970.7			-			1,722.1
Total assets	$	10,528.8		$	14,265.4		$	13,235.1		$	121,418.5		$	(138,523.3	)	$	20,924.5

Current liabilities:
Accounts payable and accruals	$	0.5		$	37.4		$	194.0		$	2,929.1		$	-		$	3,161.0
Short-term borrowings and current maturities of long-term debt		-			1,752.7			353.2			244.5			-			2,350.4
Accounts and note payable affiliates		3,409.7			5,230.6			5,526.5			29,349.2			(43,516.0	)		-
Total current liabilities		3,410.2			7,020.7			6,073.7			32,522.8			(43,516.0	)		5,511.4

Long-term debt		299.2			1,598.7			395.7			480.1			-			2,773.7
Note payable affiliate		-			-			1,047.4			-			(1,047.4	)		-
Other noncurrent liabilities		158.0			2.9			2,194.4			3,622.7			-			5,978.0
Total liabilities		3,867.4			8,622.3			9,711.2			36,625.6			(44,563.4	)		14,263.1

Shareholders’ equity:
Class A common shares		370.9			(52.1	)		-			-			-			318.8
Class B common shares		197.2			-			-			-			(197.2	)		-
Other shareholders’ equity		8,930.7			5,645.0			4,446.0			87,278.2			(99,506.5	)		6,793.4
Accumulated other comprehensive income (loss)		(129.3	)		50.2			(523.3	)		(176.2	)		327.8			(450.8	)
		9,369.5			5,643.1			3,922.7			87,102.0			(99,375.9	)		6,661.4
Less: Contra account		(2,708.1	)		-			(398.8	)		(2,309.1	)		5,416.0			-
Total shareholders’ equity		6,661.4			5,643.1			3,523.9			84,792.9			(93,959.9	)		6,661.4
Total liabilities and equity	$	10,528.8		$	14,265.4		$	13,235.1		$	121,418.5		$	(138,523.3	)	$	20,924.5

F-59

Condensed Consolidating Balance Sheet

December 31, 2007


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			Consolidating Adjustments			IR Limited Consolidated
Current assets:
Cash and cash equivalents	$	0.6		$	1,979.1		$	545.4		$	2,210.2		$	-		$	4,735.3
Accounts and notes receivable		0.4			-			263.8			1,396.5			-			1,660.7
Inventories		-			-			76.4			750.8			-			827.2
Other current assets		-			0.2			136.7			340.6			-			477.5
Accounts and notes receivable affiliates		252.6			916.2			5,150.6			33,482.0			(39,801.4	)		-
Total current assets		253.6			2,895.5			6,172.9			38,180.1			(39,801.4	)		7,700.7

Investment in affiliates		9,795.0			8,050.3			9,487.9			38,083.3			(65,416.5	)		-
Property, plant and equipment, net		-			-			151.1			753.8			-			904.9
Intangible assets, net		-			-			72.5			4,645.4			-			4,717.9
Other assets		1.5			-			704.5			346.7			-			1,052.7
Total assets	$	10,050.1		$	10,945.8		$	16,588.9		$	82,009.3		$	(105,217.9	)	$	14,376.2

Current liabilities:
Accounts payable and accruals	$	6.9		$	4.6		$	527.1		$	1,956.1		$	-		$	2,494.7
Short-term borrowings and current maturities of long-term debt		-			-			555.4			185.6			-			741.0
Accounts and note payable affiliates		1,639.1			5,779.7			7,001.7			25,380.9			(39,801.4	)		-
Total current liabilities		1,646.0			5,784.3			8,084.2			27,522.6			(39,801.4	)		3,235.7

Long-term debt		299.1			-			403.2			10.4			-			712.7
Note payable affiliate		-			-			2,097.4			-			(2,097.4	)		-
Other liabilities		197.1			0.4			1,916.4			406.0			-			2,519.9
Total liabilities		2,142.2			5,784.7			12,501.2			27,939.0			(41,898.8	)		6,468.3

Shareholders’ equity:
Class A common shares		370.0			(97.4	)		-			-			-			272.6
Class B common shares		270.6			-			-			-			(270.6	)		-
Other shareholders’ equity		11,046.9			5,115.6			4,900.3			57,564.7			(71,238.7	)		7,388.8
Accumulated other comprehensive income (loss)		567.9			52.8			(397.4	)		527.8			(504.6	)		246.5
		12,255.4			5,071.0			4,502.9			58,092.5			(72,013.9	)		7,907.9
Less: Contra account		(4,347.5	)		90.1			(415.2	)		(4,022.2	)		8,694.8			-
Total shareholders’ equity		7,907.9			5,161.1			4,087.7			54,070.3			(63,319.1	)		7,907.9
Total liabilities and equity	$	10,050.1		$	10,945.8		$	16,588.9		$	82,009.3		$	(105,217.9	)	$	14,376.2

F-60

Condensed Consolidating Statement of Cash Flows

For the year ended December 31, 2008


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			IR Limited Consolidated
Net cash (used in) provided by continuing operating activities	$	(74.2	)	$	(82.4	)	$	(708.3	)	$	1,221.7		$	356.8
Net cash (used in) provided by discontinued operating activities		—			—			(2.6	)		(23.3	)		(25.9	)

Cash flows from investing activities:
Capital expenditures		—			—			(31.0	)		(275.0	)		(306.0	)
Proceeds from sale of property, plant and equipment		—			—			(8.4	)		85.8			77.4
Acquisitions, net of cash		—			—			—			(7,107.3	)		(7,107.3	)
Proceeds from business dispositions		—			—			21.7			31.2			52.9
Proceeds from the sale of marketable securities		—			—			8.0			(0.2	)		7.8
Other		—			—			(7.9	)		(23.3	)		(31.2	)
Net cash (used in) provided by continuing investing activities		—			—			(17.6	)		(7,288.8	)		(7,306.4	)
Net cash (used in) provided by discontinued investing activities		—			—			—			—			—

Cash flows from financing activities:
Net proceeds (repayments) in debt		—			3,351.4			(209.7	)		(157.3	)		2,984.4
Debt issue costs		—			(23.0	)		—			—			(23.0	)
Net inter-company (payments) proceeds		516.6			(5,275.8	)		365.5			4,393.7			—
Proceeds from the exercise of stock options		18.5			—			—			—			18.5
Excess tax benefit from share-based compensation		—			—			19.5			(6.4	)		13.1
Dividends (paid) received		(461.5	)		53.8			16.4			178.4			(212.9	)
Repurchase of common shares by subsidiary		—			(2.0	)		—			—			(2.0	)
Net cash (used in) provided by continuing financing activities		73.6			(1,895.6	)		191.7			4,408.4			2,778.1
Net cash (used in) provided by discontinued financing activities		—			—			—			—			—

Effect of exchange rate changes on cash and cash equivalents		—			—			—			12.3			12.3

Net (decrease) increase in cash and cash equivalents		(0.6	)		(1,978.0	)		(536.8	)		(1,669.7	)		(4,185.1	)
Cash and cash equivalents - beginning of period		0.6			1,979.1			545.4			2,210.2			4,735.3
Cash and cash equivalents - end of period	$	—		$	1.1		$	8.6		$	540.5		$	550.2

F-61

Condensed Consolidating Statement of Cash Flows

For the year ended December 31, 2007


In millions	IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			IR Limited Consolidated
Net cash (used in) provided by continuing operating activities	$	(100.0)		$	-		$	(457.8	)	$	1,387.7		$	829.9
Net cash (used in) provided by discontinued operating activities		-			-			(37.0	)		103.2			66.2

Cash flows from investing activities:
Capital expenditures		-			-			(24.7	)		(95.0	)		(119.7	)
Proceeds from sale of property, plant and equipment		-			-			4.6			9.6			14.2
Acquisitions, net of cash		-			-			(0.6	)		(25.1	)		(25.7	)
Proceeds from business dispositions		-			-			3,076.7			3,077.6			6,154.3
Proceeds from the sale of marketable securities		-			-			-			0.7			0.7
Other		-			-			(0.3	)		28.9			28.6
Net cash (used in) provided by continuing investing activities		-			-			3,055.7			2,996.7			6,052.4
Net cash (used in) provided by discontinued investing activities		-			-			(4.7	)		(53.0	)		(57.7	)

Cash flows from financing activities:
Net proceeds (repayments) in debt		(378.0	)		-			(49.4	)		(122.3	)		(549.7	)
Net inter-company (payments) proceeds		776.2			3,924.1			(2,088.6	)		(2,611.7	)		-
Proceeds from the exercise of stock options		160.2			-			-			-			160.2
Excess tax benefit from share-based compensation		-			-			29.1			7.0			36.1
Dividends (paid) received		(459.5	)		54.9			16.4			178.4			(209.8	)
Repurchase of common shares by subsidiary		-			(1,999.9	)		-			-			(1,999.9	)
Net cash (used in) provided by continuing financing activities		98.9			1,979.1			(2,092.5	)		(2,548.6	)		(2,563.1	)
Net cash (used in) provided by discontinued financing activities		-			-			-			-			-

Effect of exchange rate changes on cash and cash equivalents		-			-			-			51.8			51.8

Net (decrease) increase in cash and cash equivalents		(1.1	)		1,979.1			463.7			1,937.8			4,379.5
Cash and cash equivalents - beginning of period		1.7			-			81.7			272.4			355.8
Cash and cash equivalents - end of period	$	0.6		$	1,979.1		$	545.4		$	2,210.2		$	4,735.3

F-62

Condensed Consolidating Statement of Cash Flows

For the year ended December 31, 2006


In millions		IR Limited			IR Global Holding			IR New Jersey			Other Subsidiaries			IR Limited Consolidated
Net cash (used in) provided by continuing operating activities	$	(67.4	)	$	-		$	(83.3	)	$	963.8		$	813.1
Net cash (used in) provided by discontinued operating activities		-			-			173.4			(31.7	)		141.7

Cash flows from investing activities:
Capital expenditures		-			-			(43.8	)		(101.0	)		(144.8	)
Proceeds from sale of property, plant and equipment		-			-			0.9			8.7			9.6
Acquisitions, net of cash		-			-			(11.8	)		(37.9	)		(49.7	)
Proceeds from business dispositions		-			-			-			-			-
Proceeds from the sale of marketable securities		-			151.4			-			4.4			155.8
Other		-			-			-			0.4			0.4
Net cash (used in) provided by continuing investing activities		-			151.4			(54.7	)		(125.4	)		(28.7	)
Net cash (used in) provided by discontinued investing activities		-			-			(8.7	)		(123.8	)		(132.5	)

Cash flows from financing activities:
Net proceeds (repayments) in debt		379.1			-			(499.7	)		(19.9	)		(140.5	)
Net inter-company (payments) proceeds		(7.3	)		847.0			323.1			(1,162.8	)		-
Proceeds from the exercise of stock options		95.7			-			-			-			95.7
Excess tax benefit from stock-based compensation		-			-			8.9			6.6			15.5
Dividends (paid) received		(423.9	)		22.3			15.6			168.4			(217.6	)
Repurchase of common shares by subsidiary		-			(1,096.3	)		-			-			(1,096.3	)
Net cash (used in) provided by continuing financing activities		43.6			(227.0	)		(152.1	)		(1,007.7	)		(1,343.2	)
Net cash (used in) provided by discontinued financing activities		-			-			-			-			-

Effect of exchange rate changes on cash and cash equivalents		-			-			-			29.4			29.4

Net (decrease) increase in cash and cash equivalents		(23.8	)		(75.6	)		(125.4	)		(295.4	)		(520.2	)
Cash and cash equivalents - beginning of period		25.5			75.6			207.1			567.8			876.0
Cash and cash equivalents - end of period	$	1.7		$	-		$	81.7		$	272.4		$	355.8

F-63

SCHEDULE II

INGERSOLL-RAND COMPANY LIMITED

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(Amounts in millions)


Allowances for Doubtful Accounts:

Balance December 31, 2005	$	28.3
Net reductions in costs and expenses		(11.4	)
Deductions *		(11.4	)
Business acquisitions and divestitures, net		1.4
Currency translation		1.4

Balance December 31, 2006		8.3
Additions charged to costs and expenses		9.8
Deductions *		(7.2	)
Business acquisitions and divestitures, net		0.4
Currency translation		0.9

Balance December 31, 2007		12.2
Additions charged to costs and expenses		15.1
Deductions *		(15.6	)
Business acquisitions and divestitures, net		43.6
Currency translation		(4.1	)

Balance December 31, 2008	$	51.2

(*)	“Deductions” include accounts and advances written off, less recoveries.

F-64

SCHEDULE II

INGERSOLL-RAND COMPANY LIMITED

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(Amounts in millions)


Reserve for LIFO:

Balance December 31, 2005	$	77.9
Additions		19.7
Reductions		(2.2	)

Balance December 31, 2006		95.4
Additions		-
Reductions		(11.1	)

Balance December 31, 2007		84.3
Additions		38.4
Reductions		(9.2	)

Balance December 31, 2008	$	113.5

F-65

Exhibit 3.2

AMENDED AND RESTATED

BYE – LAWS

INGERSOLL – RAND COMPANY LIMITED

Adopted June 4, 2008

AMENDED AND RESTATED

BYE – LAWS

INGERSOLL – RAND COMPANY LIMITED

Adopted June 4, 2008

TABLE OF CONTENTS


		Page
INTERPRETATION		1
1. Interpretation		1
BOARD OF DIRECTORS		3
2. Board of Directors		3
3. Management of the Company		3
4. Power to Authorise Specific Actions		3
5. Power to Appoint Attorney		3
6. Power to Delegate to a Committee		3
7. Power to Appoint and Dismiss Employees		4
8. Power to Borrow and Charge Property		4
9. Exercise of Power to Purchase Shares of or Discontinue the Company		4
10. Election of Directors		4
11. Defects in Appointment of Directors		6
12. Removal of Directors		6
13. Vacancies on the Board		6
14. Notice of Meetings of the Board		6
15. Quorum at Meetings of the Board		7
16. Meetings of the Board		7
17. Unanimous Written Resolutions of Directors		7
18. Contracts and Disclosure of Directors’ Interests		7
19. Remuneration of Directors		8
OFFICERS		8
20. Officers of the Company		8
21. Appointment of Secretary		8
22. Duties of Officers		8
23. Chairman of Meetings		8
24. Register of Directors and Officers		8
MINUTES		9
25. Obligations of Board to Keep Minutes		9
INDEMNITY		9
26. Indemnification of Directors and Officers of the Company		9
MEETINGS		10
27. Annual General Meeting		10
28. Special General Meetings		11
29. Giving Notice and Access		11
30. Accidental Omission of Notice of General Meeting		11
31. Short Notice		12
32. Security at General Meetings		12
33. Meeting Called on Requisition of Members		12
34. Postponement of Meetings		12
35. Quorum for General Meeting		12
36. Adjournment of Meetings		12
37. Attendance at Meetings		13
38. Unanimous Written Resolutions of Members		13


39. Attendance of Directors		13
40. Presiding Officer at Meetings		13
41. Voting at Meetings		13
42. Seniority of Joint Holders Voting		14
43. Instrument of Proxy		14
44. Representation of Corporations at Meetings		14
SHARE CAPITAL AND SHARES		14
45. Authorised Share Capital		14
46. Power to Issue Shares		17
47. Variation of Rights, Alteration of Share Capital and Purchase of Shares of the Company		17
48. Registered Holder of Shares		17
49. Death of a Joint Holder		18
50. Certificated or Uncertificated Shares		18
REGISTER OF MEMBERS		18
51. Contents of Register of Members		18
52. Inspection of Register of Members		18
53. Transactions with Interested Members		18
54. Record Dates		19
55. Scrutineers		19
TRANSFER OF SHARES		19
56. Instrument of Transfer		19
57. Restriction on Transfer		19
58. Transfers by Joint Holders		20
TRANSMISSION OF SHARES		20
59. Representative of Deceased Member		20
60. Registration on Death or Bankruptcy		20
61. Dividend Entitlement of Transferee		20
DIVIDENDS AND OTHER DISTRIBUTIONS		20
62. Declaration of Dividends by the Board		20
CAPITALISATION		20
63. Issue of Bonus Shares		20
ACCOUNTS AND FINANCIAL STATEMENTS		21
64. Records of Account		21
65. Fiscal Year		21
66. Financial Statements		21
AUDIT		21
67. Appointment of Auditor		21
68. Remuneration of Auditor		21
69. Vacation of Office of Auditor		21
70. Access to Books of the Company		21
71. Report of the Auditor		21
SEAL OF THE COMPANY		22
72. The Seal		22
73. Manner in Which Seal is to be Affixed		22
WINDING-UP		22
74. Winding-up/Distribution by Liquidator		22
ALTERATION OF BYE-LAWS		22
75. Alteration of Bye-laws		22

AMENDED AND RESTATED

BYE-LAWS

INGERSOLL-RAND COMPANY LIMITED

A Bermuda Limited Liability Company

INTERPRETATION

1. Interpretation

(1) In these Bye-laws the following words and expressions shall, where not inconsistent with the context and not defined in the text, have the following meanings respectively:

(a) “ Act ” means the Companies Act 1981, as amended from time to time;

(b) “ Auditor ” includes any individual, general or limited partnership, corporation, firm, association or company (including a limited liability company);

(i) which it has the right to acquire pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or otherwise; and

(ii) which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (i) above), by any other person with which it has any agreement, arrangement or understanding with respect to the acquisition, holding, voting or disposition of shares or of any material part of the assets of the Company or of it, or which is its “affiliate” or “associate” as those terms are defined in Rule 12b-2 of the General Rules and Regulations under the United States Securities Exchange Act of 1934 (or any successor rule or regulation);

(d) “ Board ” means the Board of Directors appointed or elected pursuant to these Bye-laws and acting by resolution in accordance with the Act and these Bye-laws or the Directors present at a meeting of Directors at which there is a quorum;

(e) “ Business Combination ” means:

(i) any amalgamation, merger or consolidation of the Company or one of its subsidiaries with an Interested Member or with any person that is, or would be after such amalgamation, merger or consolidation, an affiliate or associate of an Interested Member;

(ii) any transfer or other disposition to or with an Interested Member or any affiliate or associate of an Interested Member of all or any material part of the assets of the Company or one of its subsidiaries; and

(iii) any issuance or transfer of shares of the Company upon conversion of or in exchange for the securities or assets of any Interested Member, or with any person that is, or would be after such amalgamation, merger or consolidation, an affiliate or associate of an Interested Member;

(f) “ Company ” means the company for which these Bye-laws are approved and confirmed;

(g) “ Director ” means a director of the Company;

(h) “ Interested Member ” means any Member that:

(i) is the beneficial owner, directly or indirectly, of 10% or more of the voting power of the voting shares of the Company then in issue; or

(ii) is an affiliate or associate of the Company and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the shares then in issue of the Company. For the purpose of determining whether a Member is an Interested Member, the number of voting shares of the Company then in issue shall include shares deemed to be beneficially owned by such Member, but shall not include any other unissued voting shares of the Company which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise;

(i) “ Member ” means the person registered in the Register of Members as the holder of shares in the Company and, when two or more persons are so registered as joint holders of shares, means the person whose name stands first in the Register of Members as one of such joint holders or all of such persons as the context so requires;

(j) “ Notice ” means written notice as further defined in these Bye-laws unless otherwise specifically stated;

(k) “ Officer ” means any person appointed by the Board to hold an office in the Company;

(l) “ Person ” means any individual, general or limited partnership, corporation, firm, association, trust, estate, company (including a limited liability company) or any other entity or organisation or bodies of persons whether corporate or otherwise, including a government, a political subdivision or agency or instrumentality thereof;

(m) “ Register of Directors and Officers ” means the Register of Directors and Officers referred to in these Bye-laws;

(n) “ Register of Members ” means the Register of Members referred to in these Bye-laws;

(o) “ Resident Representative ” means any person appointed to act as resident representative and includes any deputy or assistant resident representative; and

(p) “ Secretary ” means the person appointed to perform any or all of the duties of secretary of the Company and includes any deputy or assistant secretary.

(q) “ Treasury Share ” means a share of the Company that was or is treated as having been acquired and held by the Company and has been held continuously by the Company since it was so acquired and has not been cancelled.

(2) In these Bye-laws, where not inconsistent with the context:

(a) words denoting the plural number include the singular number and vice versa;

(b) words denoting the masculine gender include the feminine gender;

(i) “may” shall be construed as permissive;

(ii) “shall” shall be construed as imperative; and

(d) unless otherwise provided herein words or expressions defined in the Act shall bear the same meaning in these Bye-laws.

(3) Expressions referring to writing or written shall, unless the contrary intention appears, include cable, telex, telecopier, facsimile, printing, computer generated email, lithography, photography and other modes of representing words in legible and non-transitory form.

(4) Headings used in these Bye-laws are for convenience only and are not to be used or relied upon in the construction hereof.

BOARD OF DIRECTORS

2. Board of Directors

The business of the Company shall be managed by the Board.

3. Management of the Company

(1) In managing the business of the Company, the Board may exercise all such powers of the Company as are not, by statute or by these Bye-laws, expressly required to be exercised by the Company in general meeting, subject, nevertheless, to these Bye-laws, the provisions of any statute and to such directions as may be prescribed by the Company in general meeting.

(2) No regulation or alteration to these Bye-laws made by the Company in general meeting shall invalidate any prior act of the Board which would have been valid if that regulation or alteration had not been made.

(3) The Board may procure that the Company pay all expenses incurred in promoting and organising the Company.

4. Power to Authorise Specific Actions

The Board may from time to time and at any time authorise any person or body of persons to act on behalf of the Company for any specific purpose and in connection therewith to execute any agreement, document or instrument on behalf of the Company.

5. Power to Appoint Attorney

The Board, or any duly authorised committee, may from time to time and at any time by power of attorney appoint any person or body of persons, whether nominated directly or indirectly by the Board, to be an attorney of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Board) and for such period and subject to such conditions as it may think fit and any such power of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board may think fit and may also authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions so vested in the attorney. Such attorney may, if so authorised under the seal of the Company, execute any deed or instrument under such attorney’s personal seal with the same effect as the affixation of the seal of the Company.

6. Power to Delegate to a Committee

(1) The Board may delegate any or all of its powers to a committee or committees appointed by the Board which may consist partly or entirely of non-Directors and every such committee shall conform to such directions as the Board shall impose on them; provided that a committee appointed by the Board shall not have the power to set its or its members’ remuneration. The meetings and proceedings of any such committee shall be governed by the provisions of these Bye-laws regulating the meetings and proceedings of the Board, so far as the same are applicable and are not superseded by directions imposed by the Board.

(2) The Board, by the affirmative vote of a majority of the entire Board, may appoint from their number an executive committee of which committee a majority of committee members shall constitute a quorum; and to such extent as shall be provided in these Bye-laws and as may be permitted by law, such committee shall have and may exercise any or all of the powers of the Board.

(3) The Board, by the affirmative vote of a majority of the entire Board, may appoint any other standing committees and such standing committees shall have and may exercise such powers as may be conferred and authorised by these Bye-laws or by the Board and as may be permitted by law.

(4) Each committee of the Board shall keep complete, accurate minutes and records of all actions taken by such committee, prepare such minutes and records in a timely fashion and promptly make available all such minutes and records to each member of the Board.

7. Power to Appoint and Dismiss Employees

The Board may appoint, suspend or remove any Officer, manager, secretary, clerk, agent or employee of the Company and may fix their remuneration and determine their duties. Nothing contained in this Bye-law shall be construed to limit the Officers or any other Company official from being able to exercise these same powers to the extent they are duly authorised to do so.

8. Power to Borrow and Charge Property

The Board may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking and property, or any part thereof, and may issue debentures, debenture shares and other securities whether outright or as security for any debt, liability or obligation of the Company or any third party. Nothing contained in this Bye-law shall be construed to limit the Officers or any other Company official from being able to exercise these same powers to the extent they are duly authorised to do so.

9. Exercise of Power to Purchase Shares of or Discontinue the Company

(1) The Board may exercise all the powers of the Company to purchase all or any part of its own shares pursuant to Section 42A of the Act or to acquire them as Treasury Shares.

(2) The Board may exercise all the powers of the Company to discontinue the Company to a named country or jurisdiction outside Bermuda pursuant to Section 132G of the Act.

10. Election of Directors

(1) The Board shall consist of not less than three and not more than twenty Directors or such number in excess thereof as the Members may from time to time determine. The number of Directors to be elected at any time within the minimum and maximum limitations specified herein shall be determined from time to time by the Board pursuant to a resolution adopted by the affirmative vote of a majority of the Directors then in office.

(2) The Directors shall be elected or appointed at the annual general meeting or at any special general meeting called for that purpose. Each Director shall be elected by the affirmative vote of a majority of the votes cast with respect to such Director at any meeting for the election of Directors at which a quorum is present (a “Majority Vote Election”), PROVIDED THAT if the number of nominees exceeds the number of Directors to be elected, the Directors shall be elected by a plurality of votes cast. For purposes of this Bye-law 10 (1), “a majority of the votes cast” means that the number of shares voted “for” a Director must exceed the number of votes cast “against” that Director and “a plurality of votes cast” means that the nominees for available directorships who receive the highest number of affirmative votes cast are elected. In the event of a Majority Vote Election, if a Director nominated for re-election is not elected, the Director shall offer to tender his or her resignation to the Board . The Corporate Governance and Nominating Committee of the Board shall make a recommendation to the Board on whether to accept or reject the offer of resignation, or whether other action should be taken. The Board shall act on the Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date of the certification of the election results. The Director who offers to tender his or her resignation shall not participate in the Board’s decision.

(3) A Director shall hold office for such term as the Members may determine or, in the absence of such determination, from the conclusion of the meeting at which he or she is elected until the earliest of the following shall occur:

(a) the conclusion of the next annual general meeting;

(b) his or her successor is elected or appointed; or

PROVIDED that in the event a Director is nominated for re-election at the next annual general meeting at which there is a Majority Vote Election, and such Director fails to be re-elected, the term of office for such Director shall continue until the earlier of his or her successor is elected or appointed or his or her offer of resignation as per Bye-law 10(2) above is accepted by the Board.

(4) Any general meeting may authorise the Board to fill any vacancy left unfilled at a general meeting. Any vacancy on the Board within the minimum and maximum limitations specified in Bye-law 10(1) may be filled by a majority of the Board then in office; provided that a quorum is present. During the existence of a vacancy on the Board the remaining Directors shall have full power to act; provided that a quorum is present. The holders of Class A Common Shares (as defined hereinafter) shall be entitled at all meetings of the Members at which Directors are elected to one vote for each such share held by them as described in this Bye-Law. The holders of Class B Common Shares (as defined hereinafter) shall not be entitled to vote for the election of Directors.

(5) Directors may be removed without cause only upon the affirmative vote of the holders of at least 80% of the shares of the Company entitled to vote for the election of Directors. Directors may be removed for cause only upon the affirmative vote of the holders of at least 66 ² /3% of the shares of the Company entitled to vote for the election of Directors; provided that any meeting convened and held to consider the removal of a Director shall be convened and held in accordance with Bye-law 12.

(6) Any Member entitled to vote for the election of Directors at a meeting or to express a consent in writing without a meeting may nominate a person or persons for election as a Director only if written notice of such Member’s intent to make such nomination is given to the Secretary of the Company, either by personal delivery, mail or facsimile not later than (a) with respect to an election to be held at an annual general meeting of Members, 90 days in advance of the anniversary of the immediately preceding annual general meeting or if the date of the annual general meeting of Members occurs more than 30 days before or 60 days after the anniversary of such immediately preceding annual general meeting, not later than the close of business on the seventh day following the date on which notice of such meeting is given to Members and (b) in the case of any Member who wishes to nominate a person or persons for election as a Director pursuant to consents in writing by Members without a meeting (to the extent election by such consents is permitted under applicable law and these Bye-laws), 60 days in advance of the date on which materials soliciting such consents are first mailed to Members or, if no such materials are required to be mailed under applicable law, 60 days in advance of the date on which the first such consent in writing is executed. Each such notice shall set forth the name and address of the Member who intends to make the nomination and of the person or persons to be nominated for election as a Director, a representation that the Member is a holder of record of shares of the Company entitled to vote at such meeting or to express such consent in writing and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice or to execute such a consent in writing to elect such person or persons as a Director, a description of all arrangements or understandings between the Member and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations for election as a Director are to be made by the Member, such other information regarding each nominee proposed by such Member as would have been required to be included in a proxy statement filed pursuant to the proxy rules of the United States Securities and Exchange Commission if such nominee had been nominated, or was intended to be nominated, for election as a Director by the Board, and the consent of each nominee to serve as a Director if so elected. The Board may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedures.

11. Defects in Appointment of Directors

All bona fide acts taken at any meeting of the Board or by a committee of the Board or by any person acting as a Director shall, notwithstanding that it be afterwards discovered that there was some defect in the appointment of any Director or person acting as aforesaid, or that they or any of them were disqualified, be as valid as if every such person had been duly appointed and qualified to be a Director.

12. Removal of Directors

(1) Subject to Bye-law 10(5) and any provision to the contrary in these Bye-laws, the Members may, at any special general meeting convened and held in accordance with these Bye-laws, remove a Director; provided that the notice of any such meeting convened for the purpose of removing a Director shall contain a statement of the intention so to do and be served on such Director not less than fourteen days before the meeting and at such meeting such Director shall be entitled to be heard on the motion for such Director’s removal.

(2) A vacancy on the Board created by the removal of a Director under the provisions of subparagraph (1) of this Bye-law may be filled by the Members at the meeting at which such Director is removed and, in the absence of such election or appointment, the Board may fill the vacancy in accordance with Bye-law 13.

13. Vacancies on the Board

(1) Subject to any requirements of these Bye-laws with respect to the filling of vacancies among additional Directors elected by a class or classes of shares, if the office of any Director becomes vacant, the remaining Directors may, by a majority vote, elect a successor who shall hold office until the earliest of the following shall occur:

(a) the conclusion of the next succeeding annual general meeting of the Members;

(b) his or her successor shall have been elected or appointed; or

(2) The Board may act notwithstanding any vacancy in its number but, if and so long as its number is reduced below the number fixed by these Bye-laws as the quorum necessary for the transaction of business at meetings of the Board pursuant to Bye-law 15, the continuing Directors or Director may act for the purpose of (i) summoning a general meeting of the Company or (ii) preserving the assets of the Company.

(3) The office of Director shall be vacated if the Director:

(a) is removed from office pursuant to these Bye-laws or is prohibited from being a Director by law;

(b) is or becomes bankrupt or makes any arrangement or composition with his or her creditors generally;

(d) resigns his or her office by notice in writing to the Company.

14. Notice of Meetings of the Board

(1) Notice of a regular meeting of the Board shall be deemed to be duly given to a Director if it is given to such Director verbally in person or by telephone or otherwise communicated or sent to such Director by mail, courier service, cable, telex, telecopier, facsimile, printing, computer generated email or other mode of representing words in a legible and non-transitory form at such Director’s last known address or any other address given by such Director to the Company for this purpose before the proposed date of the meeting, but a failure of the Secretary to send such notice shall not invalidate any proceedings of the Board at such meeting.

(2) Notice of a special meeting of the Board shall be deemed to be duly given to a Director if it is sent to such Director by mail before the proposed date of the meeting, or given to such Director verbally in person or by telephone or otherwise communicated or sent to such Director by mail, courier service, cable, telex, telecopier facsimile, printing, computer generated email or other mode of representing words in a legible and non-transitory form, at such Director’s last known address or any other address given by such Director to the Company for this purpose at least one day before the proposed date of the meeting, but such notice may be waived by any Director. At any special meeting at which every Director shall be present, even without notice, any business may be transacted.

15. Quorum at Meetings of the Board

The quorum necessary for the transaction of business at all meetings of the Board shall be a majority of the Directors then in office. If at any meeting of the Board there be less than a quorum present, a majority of those present or any Director solely present may adjourn the meeting from time to time without further notice.

16. Meetings of the Board

(1) Regular meetings of the Board shall be held at such times and intervals as the Board may from time to time determine.

(2) Special meetings of the Board shall be held on the requisition of the Chairman, if there is one, or if not, the President, if there is one, or by 33 ¹ /3% of the Directors then in office.

(3) Directors may participate in any meeting of the Board by means of such telephone, electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and participation in such a meeting shall constitute presence in person at such meeting.

(4) Unless a greater number is expressly required by law or these Bye-laws, the affirmative votes of a majority of the votes cast by the Directors present at a meeting at which a quorum is in attendance shall be the act of the Board or a committee thereof, as appropriate. At any time that these Bye-laws provide that Directors elected by the holders of a class or series of shares shall have more or less than one vote per Director on any matter, every reference in these Bye-laws to a majority or other proportion of Directors shall refer to a majority or other proportion of the votes of such Directors.

17. Unanimous Written Resolutions of Directors

A resolution in writing signed by all the Directors then in office, which may be in counterparts, shall be as valid as if it had been passed at a meeting of the Board duly called and constituted, such resolution to be effective on the date on which the last Director signs the resolution.

18. Contracts and Disclosure of Directors’ Interests

(1) Any Director, or any firm, partner or any company with whom any Director is associated, may act in a professional capacity for the Company and such Director or such Director’s firm, partner or such company shall be entitled to remuneration for professional services as if such Director were not a Director; provided that nothing herein contained shall authorise a Director or Director’s firm, partner or such company to act as Auditor of the Company.

(2) A Director who is directly or indirectly interested in a contract or proposed contract or arrangement with the Company shall declare the nature of such interest as required by the Act.

(3) Following a declaration being made pursuant to this Bye-law, the Director concerned may be counted in the quorum at such meeting and, unless disqualified by the chairman of the relevant Board meeting, a Director may vote in respect of any contract or proposed contract or arrangement in which such Director is interested.

(4) Any contract or other transaction to which the Company or any subsidiary of the Company is a party and in which one or more Directors has a direct or indirect interest that is material to such Director or Directors shall be authorized, approved, or ratified by affirmative vote of a majority of the disinterested

Directors, even though the disinterested Directors be less than a quorum; provided that no such contract or other transaction shall be void or voidable solely by reason of such interest, or solely because such Director or Directors are present at the meeting of the Board or committee which authorizes or approves the contract or transaction, or solely because his or their votes are counted for such purpose, if any one of the following is true: (A) the contract or other transaction is fair and reasonable as to the Company or the subsidiary of the Company at the time it is authorized, approved or ratified; or (B) the fact of the interest is disclosed or known to the Board or committee and the Board or committee authorizes, approves, or ratifies the contract or transaction by unanimous written consent, provided at least one director so consenting is disinterested, or by affirmative vote of a majority of the disinterested Directors, even though the disinterested Directors be less than a quorum; or (C) the fact of the interest is disclosed or known to the Members, and they authorize, approve or ratify the contract or transaction.

19. Remuneration of Directors

The remuneration (if any) of the Directors shall be determined by the Board from time to time. The Directors may also be paid all travel, hotel and other expenses properly incurred by them in attending and returning from meetings of the Board, any committee appointed by the Board, general meetings of the Company, or in connection with the business of the Company or their duties as Directors generally; provided that nothing contained herein shall be construed to preclude any Director from serving the Company in any other capacity or receiving compensation therefor.

OFFICERS

20. Officers of the Company

The Officers of the Company shall consist of a Chief Executive Officer and a Secretary (who may or may not be Directors) and the Board may appoint such other officers (who may or may not be Directors) as the Board may from time to time determine, all of whom shall be deemed to be Officers for the purposes of these Bye-laws. A Person may hold any number of offices simultaneously.

21. Appointment of Secretary

The Secretary shall be appointed by the Board from time to time. The Chief Executive Officer shall have the authority to appoint and remove assistant officers (who shall not be deemed to be Officers for the purposes of these Bye-laws) with such authority as the Chief Executive Officer shall deem appropriate.

22. Duties of Officers

The Officers shall have the powers typically exercised by persons holding such offices or such powers as may be delegated to them by the Board from time to time and will perform the usual duties pertaing to such offices as well as perform such duties in the management, business and affairs of the Company as may be delegated to them by the Board from time to time.

23. Chairman of Meetings

Unless otherwise agreed by a majority of those attending and entitled to attend and vote thereat, the Chairman, if there be one and if not, the President, if there be one, shall act as chairman at all meetings of the Board, or in the absence of any of the foregoing Officers, a chairman shall be appointed or elected by those present at the meeting and entitled to vote.

24. Register of Directors and Officers

The Board shall cause to be kept in one or more books at the registered office of the Company a Register of Directors and Officers and shall enter therein the particulars required by the Act.

MINUTES

25. Obligations of Board to Keep Minutes

(1) The Board shall cause minutes to be duly entered in books provided for the purpose:

(a) of all elections and appointments of Officers;

(b) of the names of the Directors present at each meeting of the Board and of any committee appointed by the Board; and

(c) of all resolutions and proceedings of general meetings of the Members, meetings of the Board and meetings of committees appointed by the Board.

(2) Minutes prepared in accordance with the Act and these Bye-laws shall be kept by the Secretary at the registered office of the Company.

INDEMNITY

26. Indemnification of Directors and Officers of the Company

(1) The Company shall indemnify any person who was, is or is threatened to be made a party to a Proceeding (as hereinafter defined) by reason of the fact that he or she (a) is or was a Director or Officer of the Company or (b) is or was serving at the request of the Company as a director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, general or limited partnership, firm, association, trust, estate, company (including a limited liability company) or any other entity or organisation or employee benefit plan or other enterprise, to the fullest extent permitted under Bermuda law, as the same exists or may hereafter be amended. Such right shall be a contract right and as such shall run to the benefit of any Director or Officer who is elected and accepts the position of Director or Officer of the Company or elects to continue to serve as a Director or Officer of the Company while this Bye-law is in effect. Any repeal or amendment of this Bye-law shall be prospective only and shall not limit the rights of any such Director or Officer or the obligations of the Company with respect to any claim arising from or related to the services of such Director or Officer in any of the foregoing capacities prior to any such repeal or amendment to this Bye-law. Such right shall include the right to be paid by the Company expenses incurred in defending any such Proceeding in advance of its final disposition to the maximum extent permitted under Bermuda law, as the same exists or may hereafter be amended; provided that to the extent required by law, such payment of expenses in advance of the final disposition of the Proceeding shall be made only upon receipt of an undertaking by the person to repay all amounts advanced if it should be ultimately determined that the Director or Officer is not entitled to be indemnified under this Bye-law or otherwise. If a claim for indemnification or advancement of expenses hereunder is not paid in full by the Company within 60 days after a written claim has been received by the Company, the claimant may at any time thereafter bring suit against the Company to recover the unpaid amount of the claim, and if successful in whole or in part, the claimant shall also be entitled to be paid the expenses of prosecuting such claim. It shall be a defense to any such action that such indemnification or advancement of costs of defense are not permitted under Bermuda law, but the burden of proving such defense shall be on the Company. Neither the failure of the Company (including the Board or any committee thereof, independent legal counsel or Members) to have made its determination prior to the commencement of such action that indemnification of, or advancement of costs of defense to, the claimant is permissible in the circumstances nor an actual determination by the Company (including the Board or any committee thereof, independent legal counsel or Members) that such indemnification or advancement is not permissible shall be a defense to the action or create a presumption that such indemnification or advancement is not permissible. In the event of the death of any person having a right of indemnification under the foregoing provisions, such right shall inure to the benefit of his or her heirs, executors, administrators and personal representatives.

Except as otherwise provided in this subparagraph (1), the Company shall be required to indemnify a Director or Officer in connection with a Proceeding (or part thereof) commenced by such person only if the commencement of such Proceeding (or part thereof) by the person was authorised by the Board.

(2) The Company may additionally indemnify any employee or agent of the Company to the fullest extent permitted by law.

(3) The rights conferred on any person indemnified by this Bye-law shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of the Memorandum of Association of the Company, these Bye-laws, agreement, vote of the Members or disinterested Directors or otherwise.

(4) The Company’s obligation, if any, to indemnify or to advance expenses to any person indemnified who was or is serving at its request as a Director or Officer or otherwise of another person described in subparagraph (1) shall be reduced by any amount such person may collect as indemnification or advancement of expenses from such other person.

(5) This Bye-law shall not limit the right of the Company, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than persons authorised for indemnification under this Bye-law when and as authorised by appropriate corporate action.

(6) The indemnity provided by this Bye-law 26 shall not extend to any matter in respect of any fraud or dishonesty which may attach to any of said persons.

(7) “ Proceeding ,” for purposes of this Bye-law 26, means any threatened, pending or completed action, suit, claim or proceeding, whether civil, criminal, administrative, arbitrative or investigative, any appeal in such an action, suit, claim or proceeding, and any inquiry or investigation that could lead to such an action, suit, claim or proceeding.

(8) Each Member agrees to exempt a Director or Officer from any claim or right of action such Member might have, whether individually or by or in the right of the Company, against any Director or Officer on account of any action taken by such Director or Officer, or the failure of such Director or Officer to take any action in the performance of his or her duties with or for the Company; provided that such waiver shall not extend to any matter in respect of any fraud or dishonesty which may attach to such Director or Officer.

MEETINGS

27. Annual General Meeting

(1) The annual general meeting of the Company shall be held in each year other than the year of organisation at such time and place as the Board shall appoint. Notice of such meeting shall be given to each Member not less than five nor more than sixty days prior to such meeting stating the date, place and time at which the meeting is to be held, that the election of Directors will take place thereat, and as far as practicable, the other business to be conducted at the meeting.

(2) At any annual general meeting only such business shall be conducted as shall have been brought before the meeting (a) by or at the direction of the Board or (b) by any Member entitled to vote at such meeting who complies with the procedures set forth in this Bye-law. Any Member entitled to vote at such meeting may propose business to be included in the agenda of such meeting only if written notice of such Member’s intent is given to the Secretary of the Company, either by personal delivery or mail or by facsimile, not later than 90 days in advance of the anniversary of the immediately preceding annual general meeting or if the date of the annual general meeting of Members occurs more than 30 days before or 60 days after the anniversary of such immediately preceding annual meeting, not later than the close of business on the seventh day following the date on which notice of such meeting is given to Members. A Member’s notice to the Secretary shall set forth in writing as to each matter such Member proposes to bring before the annual general meeting (a) a brief description of the business desired to be brought before the annual general meeting and the reasons for conducting such business at the annual general meeting, (b) the name and address, as they appear on the Company’s books, of the Members proposing such business, (c) the class and number of shares of the Company which are beneficially owned by the Member and (d) any material interest of the Member in such business. Notwithstanding anything in these Bye-laws to the contrary, no business shall be conducted at an annual general meeting except in accordance with the

procedures set forth in this subparagraph. The Officer of the Company or other person presiding at the annual general meeting shall, if the facts so warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this subparagraph, and, if such Officer or other person should so determine, he or she shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.

28. Special General Meetings

The Chairman or the President (if any) or the Board by vote of a majority of the Board may convene a special general meeting of the Company whenever in its judgement such a meeting is necessary. Notice of such meeting shall be given to each Member not less than five nor more than sixty days prior to such meeting stating the date, time, place and the nature of the business to be considered at the meeting. Special general meetings may be held at such place as may from time to time be designated by the Board and stated in the notice of the meeting. In any special general meeting of the Company only such business shall be conducted as is set forth in the notice thereof.

29. Giving Notice and Access

(1) A notice may be given by the Company to a Member:

(a) by delivering it to such Member in person; or

(b) by sending it by letter mail or courier to such Member’s address in the Register of Members; or

(c) by transmitting it by electronic means (including facsimile and electronic mail, but not telephone) in accordance with such directions as may be given by such Member to the Company for such purpose; or

(d) in accordance with Bye-law 29(4).

(2) Any notice required to be given to a Member shall, with respect to any shares held jointly by two or more persons, be given to whichever of such persons is named first in the Register of Members and notice so given shall be sufficient notice to all the holders of such shares.

(3) Any notice (save for one delivered in accordance with Bye-law 29(4) shall be deemed to have been served at the time when the same would be delivered in the ordinary course of transmission and, in proving such service, it shall be sufficient to prove that the notice was properly addressed and prepaid, if posted, and the time when it was posted, delivered to the courier or transmitted by electronic means.

(4) Where a Member indicates his consent (in a form and manner satisfactory to the Board) to receive information or documents by accessing them on a website rather than by other means, or receipt in this manner is otherwise permitted by the Act, the Board may deliver such information or documents by notifying the Member of their availability and including therein the address of the website, the place on the website where the information or document may be found, and instructions as to how the information or document may be accessed on the website.

(5) In the case of information or documents delivered in accordance with Bye-law 29(4), service shall be deemed to have occurred when (i) the Member is notified in accordance with that Bye-law; and (ii) the information or document is published on the website.

30. Accidental Omission of Notice of General Meeting

The accidental omission to give notice of a general meeting to, or the non-receipt of notice of a general meeting by, any person entitled to receive notice shall not invalidate the proceedings at that meeting.

31. Short Notice

A general meeting of the Company shall, notwithstanding that it is called by shorter notice than that specified in these Bye-laws, be deemed to have been properly called if it is so agreed by (i) all the Members entitled to attend and vote thereat in the case of an annual general meeting and (ii) a majority in number of the Members having the right to attend and vote at the meeting, being a majority together holding not less than 95% in nominal value of the shares giving a right to attend and vote thereat in the case of a special general meeting.

32. Security at General Meetings

The Board may, and at any general meeting, the chairman of such meeting may make any arrangement and impose any requirement or restriction it or he considers appropriate to ensure the security of a general meeting including, without limitation, requirements for evidence of identity to be produced by those attending the meeting, the searching of their personal property and the restriction of items that may be taken into the meeting place. The Board and, at any general meeting, the chairman of such meeting are entitled to refuse entry to a person who refuses to comply with any such arrangements, requirements or restrictions.

33. Meeting Called on Requisition of Members

Notwithstanding anything herein, the Board shall, on the requisition of Members holding at the date of the deposit of the requisition not less than one-tenth of such of the paid-up capital of the Company as at the date of the deposit carries the right to vote in general meetings of the Company, forthwith proceed to convene a special general meeting of the Company and the provisions of Section 74 of the Act shall apply; provided that for any question proposed for consideration at any such special general meeting to be approved shall require the affirmative vote of the holders of not less than 66 ² /3% of the shares entitled to vote thereon.

34. Postponement or cancellation of Meetings

The Secretary may postpone or cancel any general meeting called in accordance with the provisions of these Bye-laws (other than a meeting requisitioned under Bye-law 33 of these Bye-laws); provided that notice of postponement or cancellation is given to each Member before the time for such meeting. Fresh notice of the date, time and place for the postponed meeting shall be given to each Member in accordance with the provisions of these Bye-laws.

35. Quorum for General Meeting

(1) In any general meeting of the Company, except as otherwise expressly required by the Act or by these Bye-laws, two or more persons present in person and representing in person or by proxy a majority of the shares then in issue entitled to vote at any meeting shall form a quorum for the transaction of business; provided that if the Company shall at any time have only one Member, one Member present in person or by proxy shall form a quorum for the transaction of business in any general meeting of the Company held during such time. If the holders of the number of shares necessary to constitute a quorum shall fail to attend in person or by proxy at the time and place fixed by these Bye-laws for an annual general meeting, a majority in interest of the Members present, in person or by proxy, may adjourn from time to time without notice other than announcement at the meeting until the holders of the amount of shares requisite to constitute a quorum shall attend. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally notified.

(2) Whenever the holders of any class or series of shares are entitled to vote separately on a specified item of business, the presence in person or by proxy of the holders of record of the shares of such class or series entitled to cast a majority of the votes thereon shall constitute a quorum for the transaction of such specified item of business.

36. Adjournment of Meetings

The chairman of a general meeting may, with the consent of a majority of the Members, in any general meeting at which a quorum is present (and shall if so directed), adjourn the meeting. Unless the meeting is adjourned to a specific date and time, fresh notice of the date, time and place for the resumption of the adjourned meeting shall be given to each Member in accordance with the provisions of these Bye-laws.

37. Attendance at Meetings

Members may participate in any general meeting by means of such telephone, electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and participation in such a meeting shall constitute presence in person at such meeting.

38. Unanimous Written Resolutions of Members

(1) Subject to subparagraph (6), any action which may be done by resolution of the Company in general meeting or by resolution of a meeting of any class of the Members of the Company, may, without a meeting and without any previous notice being required, be done by resolution in writing signed by, or, in the case of a Member that is a corporation whether or not a company within the meaning of the Act, on behalf of, all the Members who at the date of the resolution would be entitled to attend the meeting and vote on the resolution.

(2) A resolution in writing may be signed by, or, in the case of a Member that is a corporation whether or not a company within the meaning of the Act, on behalf of, all the Members, or any class thereof, in as many counterparts as may be necessary.

(3) For the purposes of this Bye-law, the date of the resolution is the date when the resolution is signed by, or, in the case of a Member that is a corporation whether or not a company within the meaning of the Act, on behalf of, the last Member to sign and any reference in any Bye-law to the date of passing of a resolution is, in relation to a resolution made in accordance with this Bye-law, a reference to such date.

(4) A resolution in writing made in accordance with this Bye-law is as valid as if it had been passed by the Company in a general or special meeting or by a meeting of the relevant class of Members, as the case may be, and any reference in any Bye-law to a meeting at which a resolution is passed or to Members voting in favour of a resolution shall be construed accordingly.

(5) A resolution in writing made in accordance with this Bye-law shall constitute minutes for the purposes of Sections 81 and 82 of the Act.

(6) This Bye-law shall not apply to:

(a) a resolution passed pursuant to Section 89(5) of the Act; or

(b) a resolution passed for the purpose of removing a Director before the expiration of his or her term of office under these Bye-laws.

39. Attendance of Directors

The Directors of the Company shall be entitled to receive notice of, and to attend and be heard in any general meeting.

40. Presiding Officer at Meetings

At all meetings of Members, unless otherwise agreed by a majority of those attending and entitled to vote thereat, the Chairman, if there be one, and if not the President, if there be one, shall act as chairman at all general meetings at which such person is present. In their absence, a chairman shall be appointed or elected by those present at the meeting and entitled to vote.

41. Voting at Meetings

Except as otherwise expressly required by the Act or these Bye-laws, any question proposed for the consideration of the Members at any general meeting at which a quorum is in attendance shall be decided by the affirmative vote of a majority of the votes cast by ballot by the Members in person or by proxy

appointed by instrument in writing subscribed by such Member or by his or her duly authorised attorney and delivered to the chairman of the meeting. In the case of an equality of votes the resolution shall fail. Directors shall be elected as set forth in Bye-law 10.

Without limiting the generality of the foregoing, any amalgamation, merger or consolidation of the Company with another entity or the sale, lease or exchange of all or substantially all of the assets of the Company shall, except as otherwise expressly provided in these Bye-laws, require the approval of Members by way of an affirmative vote of a majority of the votes cast by the Members in person or by proxy appointed by instrument in writing subscribed by such Member or by his or her duly authorised attorney and delivered to the chairman of the meeting. Prior to any votes being cast in connection with such resolutions, the chairman of the meeting may demand a poll which shall be by way of ballot.

42. Seniority of Joint Holders Voting

In the case of joint holders the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the Register of Members.

43. Instrument of Proxy

(1) A Member may appoint a proxy by (a) an instrument in writing in the form as may be prescribed by the Board from time to time, under the hand of the appointor or of the appointor’s attorney duly authorised in writing, or if the appointor is a corporation, either under its seal, or under the hand of a duly authorised officer or attorney; or (b) such telephonic, electronic or other means as may be approved by the Board from time to time.

(2) A Member who is the holder of two or more shares may appoint more than one proxy to represent him and vote on his behalf in respect of different shares.

(3) The decision of the chairman of any general meeting as to the validity of any appointment of proxy shall be final.

44. Representation of Corporations at Meetings

A corporation which is a Member may, by written instrument, authorise such person as it thinks fit to act as its representative at any meeting of the Members and the person so authorised shall be entitled to exercise the same powers on behalf of the corporation which such person represents as that corporation could exercise if it were an individual Member. Notwithstanding the foregoing, the chairman of the meeting may accept such assurances as he or she thinks fit as to the right of any person to attend and vote in general meetings on behalf of a corporation that is a Member.

SHARE CAPITAL AND SHARES

45. Authorised Share Capital

(1) The authorised share capital of the Company is US$1,175,010,000, consisting of (1) 1,175,000,000 common shares of the par value of US$1.00 per share, which common shares consist of (a) 600,000,000 Class A common shares (“ Class A Common Shares ”) and 575,000,000 Class B common shares (“ Class B Common Shares ”), and (2) 10,000,000 preference shares of the par value of US$0.001 per share (“ Preference Shares ”), with any series of Preference Shares being designated from time to time pursuant to subparagraph (4) of this Bye-law.

(2) Subject to these Bye-laws, the holders of Class A Common Shares shall:

(a) subject to Bye-law 45(3)(b), be entitled to such dividends as the Board may, in its discretion, from time to time declare and pay out of funds legally available for the payment of dividends;

(b) in the event of a liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary or for the purpose of a reorganisation or otherwise or upon any distribution of capital, after payment in full has been made to the holders of the Preference Shares of the amounts to which they are respectively entitled or sufficient sums have been set apart for the payment thereof, be entitled to receive ratably any and all surplus assets remaining to be paid or distributed;

(c) subject to any required Preference Share class votes, be entitled to one vote per Class A Common Share held by them and shall vote together as a single class on all matters submitted to a vote of the Members with the holders of (i) Preference Shares (but only to the extent the holders of Preference Shares shall be entitled to vote with respect to the applicable series of Preference Shares or under the Act) and (ii) Class B Common Shares (but only to the extent the holders of Class B Common Shares shall be entitled to vote under the Act);

(d) generally be entitled to enjoy all of the rights attaching to Class A Common Shares; and

(e) not be entitled to any preemptive or preferential rights to subscribe for or purchase any shares of any class or series of shares of the Company, now or hereafter authorised, or any series convertible into, or warrants or other evidences of optional rights to purchase or subscribe for, shares of any class or series of the Company, now or hereafter authorised.

(3) Subject to these Bye-laws, the holders of Class B Common Shares shall have all of the rights of the holders of Class A Common Shares, except that:

(a) the holders of Class B Common Shares shall not be entitled to vote, except as to matters for which the Act specifically requires voting rights for otherwise nonvoting shares;

(b) if a dividend or other distribution in cash, shares or other property is declared or paid on Class A Common Shares, a like dividend or other distribution in kind and amount shall also be declared and paid on Class B Common Shares;

(c) the holders of Class B Common Shares shall have the right to convert their shares into Class A Common Shares on a one-for-one basis in the following circumstances:

(i) to satisfy the obligations of the Company or its subsidiaries or affiliated companies to issue Class A Common Shares with regard to the exercise of share options, grants or purchases of shares pursuant to share incentive plans, employee share purchase plans, dividend reinvestment plans or other stock-based compensation, retirement or deferred compensation plans sponsored by the Company or its subsidiaries or affiliated companies; or

(ii) as consideration for any acquisition of stock or assets of a third party;

(d) in the event of the transfer of Class B Common Shares to any person other than a wholly-owned, direct or indirect, subsidiary of the Company, Class B Common Shares so transferred shall automatically be converted into Class A Common Shares on a one-for-one basis, subject to adjustment for share divisions or other recapitalization events; and

(e) the holders of Class B Common Shares shall have the right upon written notice to require the Company, subject to Section 42A of the Act, to purchase for cash the number of Class B Common Shares stated in such notice at the fair market value per Class A Common Share on the date of such notice. Any such purchase shall be settled within 180 calendar days of the day such notice is given and shall include simple interest from the date of the notice to but not including the payment date at a rate equal to the prime rate charged by the JP Morgan Chase & Co or its successor. For purposes of this paragraph, the fair market value per Class A Common Share, as of any date, means the average of the high and low sales prices of a Class A Common Share as reported on the New York Stock Exchange composite tape on the applicable date, or if no sales of Class A Common Shares were made on the New York Stock Exchange on that date, the average of the high and low prices as reported on the composite tape for the most recent preceding day on which sales of Class A Common Shares were made. No dividends shall be declared on any Class B Common Shares for which notice has been given under this paragraph.

(4) The Board is empowered to cause the Preference Shares to be issued from time to time as shares of one or more series of Preference Shares, and in the resolution or resolutions providing for the issue of shares of each particular series, before issuance, the Board is expressly authorised to fix:

(a) the distinctive designation of such series and the number of shares which shall constitute such series, which number may be increased (except as otherwise provided by the Board in creating such series) or decreased (but not below the number of shares thereof then in issue) from time to time by resolution of the Board;

(b) the rate of dividends payable on shares of such series, whether or not and upon what conditions dividends on shares of such series shall be cumulative and, if cumulative, the date or dates from which dividends shall accumulate;

(c) the terms, if any, on which shares of such series may be redeemed, including without limitation, the redemption price or prices for such series, which may consist of a redemption price or scale of redemption prices applicable only to redemption in connection with a sinking fund (which term as used herein shall include any fund or requirement for the periodic purchase or redemption of shares), and the same or a different redemption price or scale of redemption prices applicable to any other redemption;

(d) the terms and amount of any sinking fund provided for the purchase or redemption of shares of such series;

(e) the amount or amounts which shall be paid to the holders of shares of such series in case of liquidation, dissolution or winding up of the Company, whether voluntary or involuntary;

(f) the terms, if any, upon which the holders of shares of such series may convert shares thereof into shares of any other class or classes or of any one or more series of the same class or of another class or classes;

(g) the voting rights, full or limited, if any, of the shares of such series; and whether or not and under what conditions the shares of such series (alone or together with the shares of one or more other series having similar provisions) shall be entitled to vote separately as a single class, for the election of one or more additional Directors of the Company in case of dividend arrearages or other specified events, or upon other matters;

(h) whether or not the holders of shares of such series, as such, shall have any preemptive or preferential rights to subscribe for or purchase shares of any class or series of shares of the Company, now or hereafter authorised, or any securities convertible into, or warrants or other evidences of optional rights to purchase or subscribe for, shares of any class or series of the Company, now or hereafter authorised;

(i) whether or not the issuance of additional shares of such series, or of any shares of any other series, shall be subject to restrictions as to issuance, or as to the preferences, rights and qualifications of any such other series; and

(j) such other rights, preferences and limitations as may be permitted to be fixed by the Board of the Company under the laws of Bermuda as in effect at the time of the creation of such series.

(5) Subject to these Bye-laws and except to the extent otherwise provided for in a series of Preference Shares in its designation, the Preference Shares shall be of equal rank and be identical in all respects. The Board is authorised to change the designations, rights, preferences and limitations of any series of Preference Shares theretofore established, no shares of which have been issued.

(6) All the rights attaching to a Treasury Share shall be suspended and shall not be exercised by the Company while it holds such Treasury Share and, except where required by the Act, all Treasury Shares shall be excluded from the calculation of any percentage or fraction of the share capital, or shares, of the Company.

46. Power to Issue Shares

(1) Subject to these Bye-laws and without prejudice to any special rights previously conferred on the holders of any existing shares or class of shares, the Board shall have the power to issue any unissued shares of the Company on such terms and conditions as it may determine and any shares or class of shares may be issued with such preferred, deferred or other special rights or such restrictions, whether in regard to dividend, voting, return of capital or otherwise as the Board may from time to time prescribe.

(2) The Board shall, in connection with the issue of any share, have the power to pay such commission and brokerage as may be permitted by law.

(3) Unless otherwise permitted by law, the Company shall not give, whether directly or indirectly, whether by means of loan, guarantee, provision of security or otherwise, any financial assistance for the purpose of a purchase or subscription made or to be made by any person of or for any shares in the Company, but nothing in this Bye-law shall prohibit transactions mentioned in Sections 39A, 39B and 39C of the Act.

47. Variation of Rights, Alteration of Share Capital and Purchase of Shares of the Company

(1) Subject to the provisions of Sections 42 and 43 of the Act and except as otherwise expressly set forth in these Bye-laws, any Preference Shares may be issued or converted into shares that, at a determinable date or at the option of the Company, are liable to be redeemed on such terms and in such manner as the Company before the issue or conversion may by resolution of the Members determine.

(2) If at any time the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may, whether or not the Company is being wound-up, be varied with the consent in writing of the holders of 75% of the shares then in issue of that class or with the sanction of a resolution passed by a majority of the votes cast in a separate general meeting of the holders of the shares of the class in accordance with Section 47(7) of the Act. The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

(3) The Company may from time to time by resolution of the Members change the currency denomination of, increase, alter or reduce its share capital in accordance with the provisions of Sections 45 and 46 of the Act. Where, on any alteration of share capital, fractions of shares or some other difficulty would arise, the Board may deal with or resolve the same in such manner as it thinks fit including, without limiting the generality of the foregoing, the issue to Members, as appropriate, of fractions of shares and/or arranging for the sale or transfer of the fractions of shares of Members.

(4) The Company may from time to time purchase its own shares in accordance with the provisions of Section 42A of the Act.

(5) The Company may purchase its own shares for cancellation or acquire them as Treasury Shares in accordance with the Act on such terms as the Board shall think fit.

48. Registered Holder of Shares

(1) The Company shall be entitled to treat the registered holder of any share as the absolute owner thereof and accordingly shall not be bound to recognise any equitable or other claim to, or interest in, such share on the part of any other person.

(2) Any dividend, interest or other moneys payable in cash in respect of shares may be paid by direct deposit to the bank account designated by the Member for such purpose and cheque or draft sent through the post directed to the Member at such Member’s address in the Register of Members or, in the case of

joint holders, to such address of the holder first named in the Register of Members, or to such person and to such address as the holder or joint holders may in writing direct. If two or more persons are registered as joint holders of any shares any one can give an effectual receipt for any dividend paid in respect of such shares.

49. Death of a Joint Holder

Where two or more persons are registered as joint holders of a share or shares then in the event of the death of any joint holder or holders the remaining joint holder or holders shall be absolutely entitled to the said share or shares and the Company shall, subject to Bye-law 60, recognise no claim in respect of the estate of any joint holder except in the case of the last survivor of such joint holders.

50. Certificated or Uncertificated Shares

(1) The shares of the Company may be issued in certificated or uncertificated form. The Board shall have power and authority to make such rules and regulations as it may deem expedient concerning the issue, transfer and registration of such certificated or uncertificated shares of the Company.

(2) Promptly after uncertificated shares have been registered as issued, the Company or its transfer agent shall send to the registered owner thereof a written statement containing a description of the issue of which such shares are a part, the number of shares registered, the date of registration and such other information as may be required or appropriate.

REGISTER OF MEMBERS

51. Contents of Register of Members

(1) The Board shall cause to be kept in one or more books a Register of its Members and shall enter therein the particulars required by the Act which are as follows:

(a) the name and address of each Member, the number and, where appropriate, the class or series of shares held by such Member and the amount paid on such shares;

(b) the date on which each person was entered in the Register as a Member; and

(2) Subject to the Act, the Company may keep an overseas or local or other branch register of Members resident in any place, and the Board may make and vary such regulations as it determines in respect of the keeping of any such register and maintaining a registration office in connection therewith.

52. Inspection of Register of Members

The Register of Members and, if applicable, any branch register of Members shall be open to inspection at the registered office of the Company and, if applicable, any registration office, on every business day, subject to such reasonable restrictions as the Board may impose, so that not less than two hours in each business day be allowed for inspection. The Register of Members and, if applicable, any branch register of Members may, after notice has been given by advertisement in an appointed newspaper to that effect, be closed for any time or times not exceeding in the whole thirty days in each year.

53. Transactions with Interested Members

(1) The Company may not engage, at any time, in any Business Combination with any Interested Member unless the Business Combination receives the affirmative vote of the holders of 80% of the shares then in issue of all classes of shares of the Company entitled to vote, considered for the purposes of this provision as one class.

(2) Interested Member status of a Member is determined as of the date of any action taken by the Board with respect to such transaction or as of any record date for the determination of Members entitled to notice and to vote with respect thereto or immediately prior to the consummation of such transaction. Any determination made in good faith by the Board, on the basis of information at the time available to it, as to whether any person is an Interested Member, shall be conclusive and binding for all purposes of these Bye-laws.

(3) The provisions of subparagraph (1) of this Bye-law shall not apply to (a) any Business Combination with an Interested Member that has been approved by the Board or (b) any agreement for the amalgamation, merger or consolidation of any subsidiary of the Company with the Company or with another subsidiary of the Company if (i) the provisions of this subparagraph shall not be changed or otherwise affected by or by virtue of the amalgamation, merger or consolidation and (ii) the holders of greater than 50% of the voting power of the Company or the subsidiary, as appropriate, immediately prior to the amalgamation, merger or consolidation continue to hold greater than 50% of the voting power of the amalgamated company immediately following the amalgamation, merger or consolidation.

54. Record Dates

Notwithstanding any other provision of these Bye-laws, the Board may fix any date as the record date for:

(a) determining the Members entitled to receive any dividend; and

(b) determining the Members entitled to receive notice of and to vote in any general meeting of the Company; provided, that such record date shall not be more than sixty days before the date of such dividend or such general meeting, as the case may be.

55. Scrutineers

(1) One or more scrutineers may be appointed by the Board to act at any meeting of Members, or, if the Board fails to act, the chairman of the meeting may appoint a scrutineer or scrutineers. A scrutineer may or may not be a Member, but shall not be a candidate for the office of Director.

(2) The scrutineer or scrutineers shall determine the number of shares then in issue and the voting power of each, the shares represented at the meeting, the existence of a quorum, the validity and effect of proxies, and shall receive votes, ballots or consents, hear and determine all challenges and questions arising in connection with the right to vote, count and tabulate all votes, ballots or consents, determine the result, and do such acts as are proper to conduct the election or vote with fairness to all Members.

(3) Each scrutineer, before entering upon the discharge of the duties described in Bye-law 55(2), shall be sworn faithfully to execute the duties of a scrutineer at such meeting with strict impartiality, and according to the best of such person’s ability.

TRANSFER OF SHARES

56. Instrument of Transfer

An instrument of transfer shall be in the form as may be prescribed by the Board from time to time. The Board may accept the instrument signed by or on behalf of the transferor alone. The transferor shall be deemed to remain the holder of such share until the same has been transferred to the transferee in the Register of Members.

57. Restriction on Transfer

(1) The Board shall refuse to register the transfer of a share unless such transfer is in accordance with the Bye-laws and all applicable consents, authorisations and permissions of any governmental body or agency in Bermuda have been obtained.

(2) If the Board refuses to register a transfer of any share, the Secretary shall, within three months after the date on which the transfer was lodged with the Company, send to the transferor and transferee notice of the refusal.

58. Transfers by Joint Holders

The joint holders of any share or shares may transfer such share or shares to one or more of such joint holders, and the surviving holder or holders of any share or shares previously held by them jointly with a deceased Member may transfer any such share to the executors or administrators of such deceased Member.

TRANSMISSION OF SHARES

59. Representative of Deceased Member

In the case of the death of a Member, the survivor or survivors where the deceased Member was a joint holder, and the legal personal representatives of the deceased Member where the deceased Member was a sole holder (as set forth in Bye-law 60), shall be the only persons recognised by the Company as having any title to the deceased Member’s interest in the shares. Subject to the provisions of Section 52 of the Act, for the purpose of this Bye-law, legal personal representative means the executor or administrator of a deceased Member or such other person as the Board may in its absolute discretion decide as being properly authorised to deal with the shares of a deceased Member.

60. Registration on Death or Bankruptcy

Any person becoming entitled to a share in consequence of the death or bankruptcy of any Member may be registered as a Member upon such evidence as the Company may deem sufficient or may elect to nominate some person to be registered as a transferee of such share, and in such case the person becoming entitled shall execute in favour of such nominee an instrument of transfer in the form as may be prescribed by the Board. On the presentation thereof to the Company, accompanied by such evidence as the Company may require to prove the title of the transferor, the transferee shall be registered as a Member but the Company shall, in either case, have the same right to decline or suspend registration as it would have had in the case of a transfer of the share by that Member before such Member’s death or bankruptcy, as the case may be.

61. Dividend Entitlement of Transferee

A person becoming entitled to a share by reason of the death or bankruptcy or winding-up of a Member shall be entitled to the same dividends and other advantages to which he or she would be entitled if he or she were the registered holder of the share. However, the Company may determine to withhold the payment of any dividend payable or other advantages in respect of such share until such person shall become the registered holder of the share or shall have effectually transferred such share, but, subject to the requirements of these Bye-laws being met, such a person may vote at meetings.

DIVIDENDS AND OTHER DISTRIBUTIONS

62. Declaration of Dividends by the Board

The Board may, subject to these Bye-laws and in accordance with Section 54 of the Act, declare a dividend to be paid to the Members, in proportion to the number of shares held by them or the class or series of shares held by them, and such dividend may be paid in cash or wholly or partly in specie in which case the Board may fix the value for distribution in specie of any assets.

CAPITALISATION

63. Issue of Bonus Shares

The Board may resolve to capitalise any part of the amount for the time being standing to the credit of any of the Company’s share premium or other reserve accounts or to the credit of the profit and loss account or otherwise available for distribution by applying such sum in paying up unissued shares to be allotted as fully paid bonus shares pro rata to the Members.

ACCOUNTS AND FINANCIAL STATEMENTS

64. Records of Account

The Board shall cause to be kept proper records of account with respect to all transactions of the Company and in particular with respect to:

(a) all sums of money received and expended by the Company and the matters in respect of which the receipt and expenditure relates;

(b) all sales and purchases of goods by the Company; and

Such records of account shall be kept at the registered office of the Company or, subject to Section 83(2) of the Act, at such other place as the Board thinks fit and shall be available for inspection by the Directors during normal business hours.

65. Fiscal Year

The financial year end of the Company may be determined by resolution of the Board and failing such resolution shall be 31st December in each year.

66. Financial Statements

Subject to any rights to waive laying of accounts pursuant to Section 88 of the Act, financial statements as required by the Act shall be laid before the Members in general meeting.

AUDIT

67. Appointment of Auditor

Subject to Section 88 of the Act, in the annual general meeting or in a subsequent special general meeting in each year, an independent representative of the Members shall be appointed by them as Auditor of the accounts of the Company. Such Auditor may be a Member but no Director, Officer or employee of the Company shall, during his or her continuance in office, be eligible to act as an Auditor of the Company.

68. Remuneration of Auditor

The remuneration of the Auditor shall be fixed by the Company in general meeting or in such manner as the Members may determine.

69. Vacation of Office of Auditor

If the office of Auditor becomes vacant by the resignation or death of the Auditor, or by the Auditor becoming incapable of acting by reason of illness or other disability at a time when the Auditor’s services are required, the Board shall, as soon as practicable, convene a special general meeting to fill the vacancy thereby created.

70. Access to Books of the Company

The Auditor shall at all reasonable times have access to all books kept by the Company and to all accounts and vouchers relating thereto, and the Auditor may call on the Directors or Officers of the Company for any information in their possession relating to the books or affairs of the Company.

71. Report of the Auditor

(1) Subject to any rights to waive laying of accounts or appointment of an Auditor pursuant to Section 88 of the Act, the accounts of the Company shall be audited at least once in every year.

(2) The financial statements provided for by these Bye-laws shall be audited by the Auditor in accordance with generally accepted auditing standards. The Auditor shall make a written report thereon in accordance with generally accepted auditing standards and the report of the Auditor shall be submitted to the Members in general meeting pursuant to Bye-law 66.

(3) The generally accepted auditing standards referred to in subparagraph (2) of this Bye-law may be those of a country or jurisdiction other than Bermuda. If so, the financial statements and the report of the Auditor must disclose this fact and name such country or jurisdiction.

SEAL OF THE COMPANY

72. The Seal

The seal of the Company shall be in such form as the Board may from time to time determine. The Board may adopt one or more duplicate seals for use outside Bermuda.

73. Manner in Which Seal is to be Affixed

The seal of the Company shall not be affixed to any instrument except attested by the signature of a Director or the Secretary, or any person appointed by the Board for the purpose; provided that any Director, Officer or Resident Representative, may affix the seal of the Company attested by such Director, Officer or Resident Representative’s signature to any authenticated copies of these Bye-laws, the organisation documents of the Company, the minutes of any meetings or any other documents required to be authenticated by such Director, Officer or Resident Representative.

WINDING-UP

74. Winding-up/Distribution by Liquidator

If the Company shall be wound up, the liquidator may, with the sanction of a resolution of the Members, divide amongst the Members in specie or in kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not) and may, for such purpose, set such value as he or she deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between the Members or different classes of Members. The liquidator may, with the like sanction, vest the whole or any part of such assets in trustees upon such trusts for the benefit of the Members as the liquidator shall think fit, but so that no Member shall be compelled to accept any shares or other securities or assets whereon there is any liability.

ALTERATION OF BYE-LAWS

75. Alteration of Bye-laws

No Bye-law shall be rescinded, altered or amended and no new Bye-law shall be made until the same has been approved by a resolution of the Board and by a resolution of the Members.

* * * * * *

Exhibit 4.4

EXECUTION COPY

INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED, as ISSUER,

INGERSOLL-RAND COMPANY LIMITED, as GUARANTOR

and

WELLS FARGO BANK, N.A., as TRUSTEE

INDENTURE

Dated as of August 12, 2008

Senior Debt Securities

Table of Contents


		Page
RECITALS OF THE COMPANY		1
ARTICLE ONE - DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION		1
SECTION 101. Definitions.		1
Act		2
Affiliate		2
Attributable Debt		2
Authenticating Agent		2
Below Investment Grade Rating Event		2
Board of Directors		2
Board Resolution		2
Business Day		2
Calculation Agent		3
Change of Control		3
Change of Control Offer		4
Change of Control Payment Date		4
Change of Control Triggering Event		4
Commission		4
Common Shares		4
Company		4
Company Request		4
Company Order		4
Continuing Director		4
Corporate Trust Office		4
Defaulted Interest		5
Dollar		5
Event of Default		5
Exchange Act		5
Fitch		5
Funded Indebtedness		5


		Page
Global Security		5
Guarantee		5
Guarantor		5
Holder		5
Indenture		5
Interest		5
Interest Payment Date		5
Investment Grade		5
Judgment Currency		6
Maturity		6
Moody’s		6
Mortgage		6
Officer’s Certificate		6
Opinion of Counsel		6
Original Issue Discount Security		6
Outstanding		6
Paying Agent		7
Person		7
Place of Payment		7
Predecessor Security		7
Principal Property		8
Process Agent		8
Rating Agency		8
Redemption Date		8
Redemption Price		8
Regular Record Date		8
Required Currency		8
Responsible Officer		8
Restricted Subsidiary		8
S&P		8
Sale and Leaseback Transaction		8
Securities		9
Security Register		9


		Page
Security Registrar		9
shareholders equity in the Company and its consolidated Subsidiaries		9
Special Record Date		9
Stated Maturity		9
Subsidiary		9
Trigger Period		9
Trustee		9
Trust Indenture Act		9
U.S. Depositary		10
U.S. Government Obligations		10
Vice President		10
Voting Stock		10
SECTION 102.	Compliance Certificates and Opinions	10
SECTION 103.	Form of Documents Delivered to Trustee	11
SECTION 104.	Acts of Holders	11
SECTION 105.	Notices, Etc., to Trustee, Company and Guarantor	12
SECTION 106.	Notice to Holders; Waiver	12
SECTION 107.	Conflict with Trust Indenture Act	13
SECTION 108.	Effect of Headings and Table of Contents	13
SECTION 109.	Successors and Assigns	13
SECTION 110.	Separability Clause	13
SECTION 111.	Benefits of Indenture	13
SECTION 112.	Governing Law	13
SECTION 113.	Legal Holidays	13
SECTION 114.	Incorporators, Shareholders, Officers and Directors of the Company and the Guarantor Exempt from Individual Liability	14
SECTION 115.	Counterparts	14
SECTION 116.	Currency Exchange	14
SECTION 117.	Judgment Currency; Consent to Jurisdiction and Service	14
SECTION 118.	Force Majeure	16

ARTICLE TWO - SECURITY FORMS		16
SECTION 201.	Forms Generally	16
SECTION 202.	Form of Face of Security	17

iii


		Page
SECTION 203.	Form of Reverse of Security	19
SECTION 204.	Form of Trustee’s Certificate of Authentication	29
SECTION 205.	Securities in Global Form	29
SECTION 206.	Guarantee; Form of Guarantee	29

ARTICLE THREE - THE SECURITIES		31
SECTION 301.	Amount Unlimited; Issuable in Series	31
SECTION 302.	Denominations	33
SECTION 303.	Execution, Authentication, Delivery and Dating	34
SECTION 304.	Temporary Securities	35
SECTION 305.	Registration, Registration of Transfer and Exchange	36
SECTION 306.	Mutilated, Destroyed, Lost and Stolen Securities	38
SECTION 307.	Payment of Interest; Interest Rights Preserved	39
SECTION 308.	Persons Deemed Owners	40
SECTION 309.	Cancellation	41
SECTION 310.	Computation of Interest	41
SECTION 311.	CUSIP Numbers	41

ARTICLE FOUR - SATISFACTION AND DISCHARGE		41
SECTION 401.	Satisfaction and Discharge of Indenture	41
SECTION 402.	Application of Trust Money	43
SECTION 403.	Satisfaction, Discharge and Defeasance of Securities of any Series	44
SECTION 404.	Reinstatement	45

ARTICLE FIVE - REMEDIES		46
SECTION 501.	Events of Default	46
SECTION 502.	Acceleration of Maturity; Rescission and Annulment	47
SECTION 503.	Collection of Indebtedness and Suits for Enforcement by Trustee	49
SECTION 504.	Trustee May File Proofs of Claim	49
SECTION 505.	Trustee May Enforce Claims Without Possession of Securities	50
SECTION 506.	Application of Money Collected	50
SECTION 507.	Limitation on Suits	51
SECTION 508.	Unconditional Right of Holders to Receive Principal, Premium and Interest	52
SECTION 509.	Restoration of Rights and Remedies	52
SECTION 510.	Rights and Remedies Cumulative	52


		Page
SECTION 511.	Delay or Omission Not Waiver	52
SECTION 512.	Control by Holders	52
SECTION 513.	Waiver of Past Defaults	53
SECTION 514.	Undertaking for Costs	53
SECTION 515.	Waiver of Stay or Extension Laws	53

ARTICLE SIX - THE TRUSTEE		54
SECTION 601.	Certain Duties and Responsibilities	54
SECTION 602.	Notice of Defaults	55
SECTION 603.	Certain Rights of Trustee	55
SECTION 604.	Not Responsible for Recitals or Issuance of Securities	57
SECTION 605.	May Hold Securities	57
SECTION 606.	Money Held in Trust	57
SECTION 607.	Compensation and Reimbursement	58
SECTION 608.	Disqualification; Conflicting Interests	58
SECTION 609.	Corporate Trustee Required; Different Trustees for Different Series; Eligibility	59
SECTION 610.	Resignation and Removal; Appointment of Successor	59
SECTION 611.	Acceptance of Appointment by Successor	61
SECTION 612.	Merger, Conversion, Consolidation or Succession to Business	62
SECTION 613.	Preferential Collection of Claims Against the Company or the Guarantor	62
SECTION 614.	Authenticating Agents	62

ARTICLE SEVEN - HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY		64
SECTION 701.	Company to Furnish Trustee Names and Addresses of Holders	64
SECTION 702.	Preservation of Information; Communications to Holders	64
SECTION 703.	Reports by Trustee	66
SECTION 704.	Reports by Company	66

ARTICLE EIGHT - CONSOLIDATION, MERGER, CONVEYANCE, SALE OR LEASE		68
SECTION 801.	Company and Guarantor May Consolidate, Etc., on Certain Terms	68
SECTION 802.	Securities to be Secured in Certain Events	69
SECTION 803.	Successor Corporation to be Substituted	69
SECTION 804.	Opinion of Counsel to be Given to Trustee	70


		Page
ARTICLE NINE - SUPPLEMENTAL INDENTURES		70
SECTION 901.	Supplemental Indentures without Consent of Holders	70
SECTION 902.	Supplemental Indentures with Consent of Holders	71
SECTION 903.	Execution of Supplemental Indentures	72
SECTION 904.	Effect of Supplemental Indentures	73
SECTION 905.	Conformity with Trust Indenture Act	73
SECTION 906.	Reference in Securities to Supplemental Indentures	73

ARTICLE TEN - COVENANTS		73
SECTION 1001.	Payment of Principal, Premium and Interest	73
SECTION 1002.	Maintenance of Office or Agency	73
SECTION 1003.	Money for Securities Payments to Be Held in Trust	74
SECTION 1004.	Limitation on Liens	75
SECTION 1005.	Limitation on Sale and Leaseback Transactions	77
SECTION 1006.	Defeasance of Certain Obligations	78
SECTION 1007.	Statement by Officer as to Default	79
SECTION 1008.	Waiver of Certain Covenants	80
SECTION 1009.	Calculation of Original Issue Discount	80

ARTICLE ELEVEN - REDEMPTION OF SECURITIES		80
SECTION 1101.	Applicability of Article	80
SECTION 1102.	Election to Redeem; Notice to Trustee	81
SECTION 1103.	Selection by Trustee of Securities to Be Redeemed	81
SECTION 1104.	Notice of Redemption	81
SECTION 1105.	Deposit of Redemption Price	82
SECTION 1106.	Securities Payable on Redemption Date	82
SECTION 1107.	Securities Redeemed in Part	83
SECTION 1108.	Offer to Redeem Upon Change of Control Triggering Event	83

ARTICLE TWELVE - SINKING FUNDS		85
SECTION 1201.	Applicability of Article	85
SECTION 1202.	Satisfaction of Sinking Fund Payments with Securities	85
SECTION 1203.	Redemption of Securities for Sinking Fund	85

ARTICLE THIRTEEN - GUARANTEE		87
SECTION 1301.	Guarantee	87
SECTION 1302.	Execution and Delivery of Guarantee	88


		Page
SECTION 1303.	Notice to Trustee	88
SECTION 1304.	This Article Not to Prevent Events of Default	88
SECTION 1305.	Amendment, Etc.	88
SECTION 1306.	Limitation on Liability	88

vii

Reconciliation and tie between Trust Indenture Act of 1939 and Indenture, dated as of _________________.


Trust Indenture Act Section		Indenture Section

§ 310(a)(1) (a)(2) (a)(3) (a)(4) (b)		609 609 Not Applicable Not Applicable 608, 610
§ 311(a) (b) (b)(2)		613 613 703(a)
§ 312(a) (b) (c)		701, 702(a) 702(b) 702(c)
§ 313(a) (b)(1) (b)(2) (c) (d)		703(a) Not Applicable 703(a) 703(a) 703(b)
§ 314(a) (b) (c)(1) (c)(2) (c)(3) (d) (e)		704 Not Applicable 102 102 Not Applicable Not Applicable 102
§ 315(a) (b) (c) (d) (d)(1) (d)(2) (d)(3) (e)		601(a) 602 601(b) 601(c) 601(c)(1) 601(c)(2) 601(c)(3) 514
§ 316(a)(1)(A) (a)(1)(B) (a)(2) (b)		502, 512 513 Not Applicable 508
§ 317(a)(1) (a)(2) (b)		503 504 1003
§ 318(a)		107

Note: This reconciliation and tie shall not, for any purpose, be deemed to be a part of this Indenture.

INDENTURE, dated as of August 12, 2008 among INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED, a company duly organized and existing under the laws of Bermuda (herein called the “Company”), having a registered office at Clarendon House, 2 Church Street, Hamilton, HM11 Bermuda, INGERSOLL-RAND COMPANY LIMITED, a company duly organized and existing under the laws of Bermuda (herein called “IR Limited” or the “Guarantor”), having a registered office at Clarendon House, 2 Church Street, Hamilton, HM11 Bermuda, and WELLS FARGO BANK, N.A., a national banking association, as Trustee (herein called the “Trustee”).

RECITALS OF THE COMPANY

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (herein called the “Securities”), to be issued in one or more series as in this Indenture provided.

The Guarantor directly owns beneficially 100% of the issued share capital of the Company.

The Guarantor has duly authorized the execution and delivery of this Indenture to provide for the Guarantee of the Securities provided for herein.

All things necessary to make this Indenture a valid agreement of the Company and the Guarantor, in accordance with its terms, have been done.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Securities or of series thereof, as follows:

ARTICLE ONE

- DEFINITIONS AND OTHER PROVISIONS

OF GENERAL APPLICATION

SECTION 101. Definitions .

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(1) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

(2) all other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;

(3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles in the United States of America, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted at the date of such computation; and

(4) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, Clause or other subdivision.

Certain terms, used principally in Article Six, are defined in that Article.

“Act” when used with respect to any Holder, has the meaning specified in Section 104.

“Affiliate” of any specified person means any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person. For the purposes of this definition, “control” when used with respect to any specified person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Attributable Debt” has the meaning specified in Section 1004(c)(1).

“Authenticating Agent” means any person authorized to authenticate and deliver Securities on behalf of the Trustee for the Securities of any series pursuant to Section 614.

“Below Investment Grade Rating Event” means the Securities of the relevant series cease to be rated Investment Grade by at least two of the three Rating Agencies on any date during the Trigger Period.

“Board of Directors” means either the board of directors of the Company or the Guarantor, as applicable, or an executive committee of such board of directors or any other duly authorized committee of that board of directors to which the powers of that board of directors have been lawfully delegated.

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company or the Guarantor, as applicable, to have been duly adopted by the Board of Directors of the Company or the Guarantor, as the case may be, and to be in full force and effect on the date of such certification, and delivered to the Trustee for the Securities of any series.

“Business Day”, when used with respect to any Place of Payment, means each day which is not a day on which banking institutions in that Place of Payment are authorized or obligated by law to close.

“Calculation Agent” means any person authorized by the Company to determine the floating rate interest rate of the Securities. Initially, Wells Fargo Bank, N.A. shall act as calculation agent in connection with the Securities. The Calculation Agent shall serve as the calculation agent hereunder unless and until a successor calculation agent is appointed by the Company.

“Change of Control” means the occurrence of any one of the following:

(i) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Guarantor and its subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d) and Section 14(d) of the Exchange Act) other than to the Guarantor or one of its subsidiaries;

(ii) the consummation of any transaction (including without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d) and Section 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the outstanding Voting Stock of the Guarantor, or other Voting Stock into which the Voting Stock of the Guarantor is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares;

(iii) the first day on which the majority of the members of the Board of Directors of the Guarantor cease to be Continuing Directors;

(iv) IR Limited consolidates with, or merges with or into, any person, or any person consolidates with, or merges with or into, IR Limited, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of IR Limited or such other person is converted into or exchanged for cash, securities or other property, other than any such transaction where the shares of the Voting Stock of IR Limited outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, a majority of the Voting Stock of the surviving person immediately after giving effect to such transaction;

(v) the adoption of a plan relating to the liquidation or dissolution of IR Limited; or

(vi) the failure of IR Limited to own, directly or indirectly, at least 51% of the Voting Stock of the Company.

Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control under Clause (ii) above if (1) the Guarantor becomes a direct or indirect wholly-owned subsidiary of a holding company and (2) the direct or indirect holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of the Voting Stock of the Guarantor immediately prior to that transaction.

“Change of Control Offer” has the meaning specified in Section 1108(a).

“Change of Control Payment Date” has the meaning specified in Section 1108(b).

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event. Notwithstanding the foregoing, no Change of Control Triggering Event will be deemed to have occurred in connection with any particular Change of Control unless and until such Change of Control has actually been consummated.

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

“Common Shares” means the common shares, par value $1 per share, of the Guarantor.

“Company” means the person named as the “Company” in the first paragraph of this Indenture until a successor company shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor company.

“Company Request” or “Company Order” means, in the case of the Company, a written request or order signed in the name of the Company, by its Chairman of the Board of Directors, its President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee for the Securities of any series and, in the case of the Guarantor, a written request or order signed in the name of the Guarantor by the Guarantor’s Chairman of the Board of Directors, its President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to the Trustee for the Securities of any series.

“Continuing Director” means, as of any date of determination, any member of the Board of Directors of the Guarantor who: (1) was a member of such Board of Directors on the date of the issuance of the Securities of the applicable series; or (2) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election.

“Corporate Trust Office” means the principal office of the Trustee for the Securities of any series at which at any particular time its corporate trust business shall be administered, which at the date of this Indenture is Wells Fargo Bank, N.A., Corporate Trust Services, 45 Broadway, 14 ^th Floor, New York, New York 10006, Attention: Corporate Trust Services.

“Defaulted Interest” has the meaning specified in Section 307.

“Dollar” or “$” means a dollar or other equivalent unit in such coin or currency of the United States of America as at the time shall be legal tender for the payment of public and private debts.

“Event of Default” unless otherwise specified in the supplemental indenture, Board Resolution or Officer’s Certificate establishing a series of Securities, has the meaning specified in Section 501.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Fitch” means Fitch Inc., a subsidiary of Fimalac, S.A., and its successors.

“Funded Indebtedness” means indebtedness created, assumed or guaranteed by a Person for money borrowed which matures by its terms, or is renewable by the borrower to a date, more than one year after the date of its original creation, assumption or guarantee.

“Global Security” means a Security evidencing all or part of a series of Securities, including, without limitation, any temporary or permanent Global Securities.

“Guarantee” means the guarantee by the Guarantor as endorsed on each Security and authenticated and delivered pursuant to this Indenture, which guarantee shall include the provisions set forth in Article Thirteen of this Indenture. “Guaranteed” shall have a meaning correlative to the foregoing.

“Guarantor” means the person named as the “Guarantor” in the first paragraph of this Indenture until a successor company shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Guarantor” shall mean such successor company.

“Holder” means a person in whose name a Security is registered in the Security Register.

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof and shall include the terms of particular series of Securities established as contemplated by Section 301.

“Interest”, when used with respect to an Original Issue Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity.

“Interest Payment Date”, when used with respect to any Security, means the Stated Maturity of an installment of interest on such Security.

“Investment Grade” means (1) a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating category of Moody’s); (2) a rating of BBB- or better by S&P (or its equivalent under any successor rating category of S&P); and (3) a rating of BBB- or better by Fitch (or its equivalent under any successor rating category of Fitch).

“Judgment Currency” has the meaning specified in Section 117.

“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise.

“Moody’s” means Moody’s Investors Service, Inc., a subsidiary of Moody’s Corporation, and its successors.

“Mortgage” has the meaning specified in Section 1004(c)(3).

“Officer’s Certificate” means, in the case of the Company, a certificate signed by the Chairman of the Board of Directors, the President or a Vice President of the Company, and in the case of the Guarantor, a certificate signed by the Chairman of the Board of Directors, the President or a Vice President of the Guarantor, and, in each case, delivered to the Trustee for the Securities of any series. Each such certificate shall include the statements provided for in Section 102 if and to the extent required by this Indenture.

“Opinion of Counsel” means a written opinion of counsel, who may be an employee of or regular counsel for the Company or the Guarantor, as the case may be, or may be other counsel reasonably satisfactory to the Trustee for the Securities of any series. Each such opinion shall include the statements provided for in Section 102 if and to the extent required by this Indenture.

“Original Issue Discount Security” means any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502.

“Outstanding” when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except:

(i) Securities theretofore cancelled by the Trustee for such Securities or delivered to such Trustee for cancellation;

(ii) Securities or portions thereof, for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee for such Securities or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities, provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor reasonably satisfactory to such Trustee has been made; and

(iii) Securities which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee for such Securities proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (a) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 502, and (b) Securities owned by the Company, the Guarantor or any other obligor upon the Securities or any Affiliate of the Company, of the Guarantor or of such other obligor shall be disregarded and deemed not to be Outstanding, except that in determining whether the Trustee for such Securities shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which a Responsible Officer of such Trustee actually knows to be so owned shall be so disregarded. Securities so owned as described in (b) above which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of such Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company, the Guarantor or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor.

“Paying Agent” means any person authorized by the Company to pay the principal of (and premium, if any, on) or interest, if any, on any Securities on behalf of the Company.

“Person” means any individual, corporation, partnership, joint venture, joint-stock company, trust unincorporated organization or government or any agency or political subdivision thereof.

“Place of Payment” when used with respect to the Securities of any series, means the place or places where the principal of (and premium, if any, on) and interest, if any, on the Securities of that series are payable as specified in or as contemplated by Section 301.

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Security.

“Principal Property” means any manufacturing plant or other manufacturing facility of the Guarantor or any Restricted Subsidiary, which plant or facility is located within the United States of America, except any such plant or facility which the Board of Directors of the Guarantor by resolution declares is not of material importance to the total business conducted by the Guarantor and its Restricted Subsidiaries.

“Process Agent” has the meaning specified in Section 117.

“Rating Agency” means each of Moody’s, S&P and Fitch; provided , that if any of Moody’s, S&P and Fitch ceases to rate the Securities of a series or fails to make a rating of the Securities of a series publicly available for reasons outside of the Company’s and the Guarantor’s control, a “nationally recognized statistical rating organization,” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, selected by the Company as a replacement agency for Moody’s, S&P or Fitch, or any of them, as the case may be, with respect to making a rating of the Securities of such series.

“Redemption Date” when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

“Redemption Price” when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture, exclusive of accrued and unpaid interest.

“Regular Record Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by Section 301.

“Required Currency” has the meaning specified in Section 117.

“Responsible Officer” when used with respect to the Trustee for the Securities of any series, means any officer within the corporate trust department of such Trustee or any other officer of such Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

“Restricted Subsidiary” means any Subsidiary which owns a Principal Property excluding however, any corporation the greater part of the operating assets of which are located, or the principal business of which is carried on, outside the United States of America. For the avoidance of doubt, the Company is a Restricted Subsidiary.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.

“Sale and Leaseback Transaction” has the meaning specified in Section 1005.

“Securities” has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.

“Security Register” and “Security Registrar” have the respective meanings specified in Section 305.

“shareholders’ equity in the Guarantor and its consolidated Subsidiaries” has the meaning specified in Section 1004(c)(2).

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee for such series pursuant to Section 307.

“Stated Maturity” when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.

“Subsidiary” means any corporation of which at least a majority of the outstanding stock having voting power under ordinary circumstances to elect a majority of the board of directors of said corporation shall at the time be owned by the Guarantor or by the Guarantor and one or more Subsidiaries or by one or more Subsidiaries of the Guarantor.

“Trigger Period” means the period commencing 60 days prior to the first public announcement by the Guarantor of any Change of Control (or pending Change of Control) and ending 60 days following the consummation of such Change of Control (which Trigger Period will be extended if the rating of the Securities of that series is under publicly announced consideration for possible downgrade by any Rating Agency on such 60th day, such extension to last with respect to each Rating Agency until the date on which such Rating Agency considering such possible downgrade either (x) rates the Securities of that series below Investment Grade or (y) publicly announces that it is no longer considering the Securities of that series for possible downgrade; provided , that no such extension will occur if on such 60th day the Securities of that series are rated Investment Grade not subject to review for possible downgrade by any Rating Agency).

“Trustee” means the person named as the “Trustee” in the first paragraph of this Indenture until a successor trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each person who is then a Trustee hereunder, and if at any time there is more than one such person, “Trustee” as used with respect to the Securities of any series shall mean each such Trustee with respect to those series of Securities with respect to which it is serving as Trustee.

“Trust Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed, except as provided in Section 905.

“U.S. Depositary” means a clearing agency registered under the Exchange Act, or any successor thereto, which shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “U.S. Depositary” shall mean or include each Person who is then a U.S. Depositary hereunder, and if at any time there is more than one such Person, “U.S. Depositary” as used with respect to the Securities of any series shall mean the U.S. Depositary with respect to the Securities of that series.

“U.S. Government Obligations” means direct obligations of the United States for the payment of which its full faith and credit is pledged, or obligations of a person controlled or supervised by and acting as an agency or instrumentality of the United States and the payment of which is unconditionally guaranteed by the United States.

“Vice President”, when used with respect to the Company, the Guarantor or the Trustee for any series of Securities, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president”.

“Voting Stock” of any specified person as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.

SECTION 102. Compliance Certificates and Opinions .

Upon any application or request by the Company or the Guarantor to the Trustee for any series of Securities to take any action under any provision of this Indenture, the Company or the Guarantor, as the case may be, shall furnish to such Trustee an Officer’s Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:

(1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(3) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

SECTION 103. Form of Documents Delivered to Trustee .

In any case where several matters are required to be certified by, or covered by an opinion of, any specified person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such person, or that they may be so certified or covered by only one document, but one such person may certify or give an opinion with respect to some matters and one or more other such persons as to other matters, and any such person may certify or give an opinion as to such matters in one or several documents.

Any certificate or opinion of an officer of the Company or the Guarantor may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his or her certificate or opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company or the Guarantor, as the case may be, stating that the information with respect to such factual matters is in the possession of the Company or the Guarantor, as the case may be, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

Where any person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instructions under this Indenture, they may, but need not, be consolidated and form one instrument.

SECTION 104. Acts of Holders .

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing, and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee for the appropriate series of Securities and, where it is hereby expressly required, to the Company or the Guarantor. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 601) conclusive in favor of such Trustee, the Guarantor and the Company, if made in the manner provided in this Section.

(b) The fact and date of the execution by any person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him or her the execution thereof. Where such execution is by a signer acting in a capacity other than his or her individual capacity, such certificate or affidavit shall also constitute sufficient proof of his or her authority. The fact and date of the execution of any such instrument or writing, or the authority of the person executing the same, may also be proved in any other manner which the Trustee for such Securities deems sufficient.

(d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee for such Securities, the Guarantor or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

SECTION 105. Notices, Etc., to Trustee, Company and Guarantor .

Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with:

(1) the Trustee for a series of Securities by any Holder or by the Company or the Guarantor shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing (including telecopy) to or with such Trustee at its Corporate Trust Office,

(2) the Company by such Trustee, or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing (including telecopy) and sent by registered or certified mail, prepaid, to the Company addressed to it care of the Guarantor at the address of the Guarantor specified in the first paragraph of this Indenture or at any other address previously furnished in writing to such Trustee by the Company, or

(3) the Guarantor by such Trustee, or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing (including telecopy) and sent by registered or certified mail, prepaid, to the Guarantor addressed to it at the address of its office specified in the first paragraph of this Indenture or at any other address previously furnished in writing to such Trustee by the Guarantor.

SECTION 106. Notice to Holders; Waiver .

Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his or her address as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waiver of notice by Holders shall be filed with the Trustee for such Securities, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee for such Securities shall constitute a sufficient notification for every purpose hereunder.

SECTION 107. Conflict with Trust Indenture Act .

If any provision hereof limits, qualifies or conflicts with another provision hereof which is required to be included in this Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control.

SECTION 108. Effect of Headings and Table of Contents .

The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

SECTION 109. Successors and Assigns .

All covenants and agreements in this Indenture by each of the Company and the Guarantor shall bind its successors and assigns, whether so expressed or not.

SECTION 110. Separability Clause .

In case any provision in this Indenture or in the Securities or the Guarantee shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 111. Benefits of Indenture .

Nothing in this Indenture or in the Securities or the Guarantee, express or implied, shall give to any person, other than the parties hereto and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture.

SECTION 112. Governing Law .

THIS INDENTURE, THE SECURITIES AND THE GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

SECTION 113. Legal Holidays .

In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities or the Guarantee)

payment of principal (and premium, if any) or interest, if any, need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date, or at the Stated Maturity, provided that no interest shall accrue for the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.

SECTION 114. Incorporators, Shareholders, Officers and Directors of the Company and the Guarantor Exempt from Individual Liability .

No recourse for the payment of the principal of (and premium, if any, on) or interest, if any, on any Security or any Guarantee, or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company or the Guarantor in this Indenture or in any supplemental indenture, or in any Security or in any Guarantee, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, shareholder, officer or director, as such, past, present or future, of the Company or the Guarantor or of any successor corporation, either directly or through the Company or the Guarantor or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that all such liability is hereby waived and released as a condition of and as a consideration for, the execution of this Indenture and the issue of the Securities and any Guarantee.

SECTION 115. Counterparts .

This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

SECTION 116. Currency Exchange .

If, in determining whether the Holders of the requisite principal amount of Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, it becomes necessary to determine the principal amount of Securities of any series denominated in any coin or currency other than that of the United States of America, such principal amount shall be computed by converting such coin or currency into coin or currency of the United States of America based upon the rate of exchange in effect at the office of the Trustee for such Securities in New York, New York at 10:00 A.M., New York City time, or as close to such time as is reasonably practicable, on the date of initial issuance of such series of Securities.

SECTION 117. Judgment Currency; Consent to Jurisdiction and Service .

(a) Each of the Company and the Guarantor agrees, to the fullest extent that it may effectively do so under applicable law, that (a) if for the purpose of obtaining judgment in any court it is necessary to convert the sum due in respect of the principal of or interest on the Securities of any series (the “Required Currency”) into a currency in which a judgment will be rendered (the “Judgment Currency”), the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee for such Securities could purchase in

The City of New York the Required Currency with the Judgment Currency at 10:00 A.M. New York City time, or as close to such time as is reasonably practicable, on the day on which final unappealable judgment is entered, unless such day is not a New York Banking Day, then, to the extent permitted by applicable law, the rate of exchange used shall be the rate at which in accordance with normal banking procedures such Trustee could purchase in The City of New York the Required Currency with the Judgment Currency at 10:00 A.M. New York City time, or as close to such time as is reasonably practicable, on the New York Banking Day preceding the day on which final unappealable judgment is entered and (b) its obligations under this Indenture to make payments in the Required Currency (i) shall not be discharged or satisfied by any tender, or any recovery pursuant to any judgment (whether or not entered in accordance with this Subsection (a)), in any currency other than the Required Currency, except to the extent that such tender or recovery shall result in the actual receipt, by the payee, of the full amount of the Required Currency expressed to be payable in respect of such payments, (ii) shall be enforceable as an alternative or additional cause of action for the purpose of recovering in the Required Currency the amount, if any, by which such actual receipt shall fall short of the full amount of the Required Currency so expressed to be payable and (iii) shall not be affected by judgment being obtained for any other sum due under this Indenture. For purposes of the foregoing, “New York Banking Day” means any day except a Saturday, Sunday or a legal holiday in The City of New York or a day on which banking institutions in The City of New York are authorized or required by law or executive order to close.

(b) To the fullest extent permitted by applicable law, each of the Company and the Guarantor hereby irrevocably submits to the jurisdiction of any federal or state court located in the Borough of Manhattan in The City of New York, New York in any suit, action or proceeding based on or arising out of or relating to this Indenture or any Securities or any Guarantee and irrevocably agrees that all claims in respect of such suit or proceeding may be determined in any such court. Each of the Company and the Guarantor irrevocably waives, to the fullest extent permitted by law, any objection which it may have to the laying of the venue of any such suit, action or proceeding brought in an inconvenient forum. Each of the Company and the Guarantor agrees that final judgment in any such suit, action or proceeding brought in such a court shall be conclusive and binding upon the Company and/or the Guarantor, as applicable, and may be enforced in the courts of Bermuda (or any other courts to the jurisdiction of which the Company or the Guarantor, as applicable, is subject) by a suit upon such judgment, provided , that service of process is effected upon the Company and/or the Guarantor, as applicable, in the manner specified herein or as otherwise permitted by law. Each of the Company and the Guarantor hereby irrevocably designates and appoints Ingersoll-Rand Company, 155 Chestnut Ridge Road, Montvale, New Jersey 07645 (the “Process Agent”) as their authorized agent for purposes of this Section 117(b), it being understood that the designation and appointment of the Process Agent as such authorized agent shall become effective immediately without any further action on the part of the Company or the Guarantor. Each of the Company and the Guarantor further agrees that service of process upon the Process Agent and written notice of said service to the Company and/or the Guarantor, as applicable, mailed by prepaid registered first class mail or delivered to the Process Agent at its principal office, shall be deemed in every respect effective service of process upon the Company and/or the Guarantor, as applicable, in any such suit or proceeding. Each of the Company and the Guarantor further agrees to take any and all action, including the execution and filing of any and all such documents and instruments as may be necessary, to continue such designation and appointment of the Process Agent in full force and

effect so long as the Company and/or the Guarantor, as applicable, has any outstanding obligations under this Indenture. To the extent the Company and/or the Guarantor, as applicable, has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution, executor or otherwise) with respect to itself or its property, each of the Company and the Guarantor hereby irrevocably waives such immunity in respect of its obligations under this Indenture to the extent permitted by law.

SECTION 118. Force Majeure .

In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

ARTICLE TWO

- SECURITY FORMS

SECTION 201. Forms Generally .

The Securities of each series shall be in substantially the form set forth in this Article, or in such other form as shall be established by or pursuant to a Board Resolution of the Company or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the officer executing such Securities, as evidenced by his or her execution of such Securities.

The certificate of authentication of the Trustee for any series of Securities shall be in substantially the form set forth in this Article.

The definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officer executing such Securities, as evidenced by their execution of such Securities.

The definitive Guarantee shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Guarantee, as evidenced by their execution of such Guarantee.

SECTION 202. Form of Face of Security .

INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED

[Title of the Security]


No.		CUSIP No.		$

INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED, a company duly organized and existing under the laws of Bermuda (herein called the “Company”, which term includes any successor company under the Indenture hereinafter referred to), for value received, hereby promises to pay to _________________________, or registered assigns, the principal sum of _____________ Dollars on _______________ [If the Security is to bear interest prior to Maturity, insert — , and to pay interest thereon from __________________ __, ______ (the “Original Issue Date”),] or from the most recent Interest Payment Date to which interest has been paid or duly provided for, [semiannually on ______________ and ______________] [quarterly on _________, __________, ___________ and ____________] in each year, commencing _______ __, _____, at [If the Security is to bear interest at a fixed rate insert—the rate per annum provided in the title hereof] [If the Security is to bear interest at a floating rate, insert— [a rate of [Insert Floating Rate] per annum], until the principal hereof is paid or made available for payment. [If applicable insert — , and, subject to the terms of the Indenture, at [the rate per annum provided in the title hereof] [such rate] on any overdue principal and premium and (to the extent that the payment of such interest shall be legally enforceable) on any overdue installment of interest].

The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the [_________ or _________] [________, _________, ________ or ___________] (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture].

[If the Security is to bear interest at a fixed rate prior to Maturity, insert — Interest shall be computed on the basis of a year of twelve 30-day months.] [If the Security is to bear interest at a floating rate prior to Maturity, insert — Interest shall be computed on the basis of the actual number of days in the relevant interest period and a 360-day year.]

[If the Security is to bear interest at a floating rate prior to Maturity, insert — The [insert Floating Rate] will be reset [insert period time as set forth in a Board Resolution of the Company] on each Interest Payment Date (each an “Interest Reset Date”), beginning on ________ __, _____. The interest rate for the period from and including the Original Issue Date to and excluding the first Interest Payment Date shall be ______ per annum (the “Initial Interest Rate”). The _________ Business Day preceding an Interest Reset Date will be the “Interest Determination Date” for that Interest Reset Date. The interest rate in effect on each day that is not an Interest Reset Date will be the interest rate determined as of the Interest Determination Date pertaining to the immediately preceding Interest Reset Date or the Initial Interest Rate, as the case may be. The interest rate in effect on any day that is an Interest Reset Date will be the interest rate determined as of the Interest Determination Date pertaining to that Interest Reset Date.

Wells Fargo Bank, N.A. shall act as calculation agent (together with its successors in that capacity, the “Calculation Agent”) in connection with the Securities. The Calculation Agent shall serve as the calculation agent hereunder unless and until a successor calculation agent is appointed by the Company. The following definitions shall be used by the Calculation Agent in its determination of the interest rate: [insert definitions for floating rate determination]. ]

[If the Security is not to bear interest prior to Maturity, insert — The principal of this Security shall not bear interest except in the case of a default in payment of principal upon acceleration, upon redemption or at Stated Maturity and in such case the overdue principal of this Security shall bear interest at the rate of [yield to maturity]% per annum (to the extent that the payment of such interest shall be legally enforceable), which shall accrue from the date of such default in payment to the date payment of such principal has been made or duly provided for. Interest on any overdue principal shall be payable on demand. Any such interest on any overdue principal that is not so paid on demand shall bear interest at the rate of [yield to maturity]% per annum (to the extent that the payment of such interest shall be legally enforceable), which shall accrue from the date of such demand for payment to the date payment of such interest has been made or duly provided for, and such interest shall also be payable on demand.]

Payment of the principal of (and premium, if any, on) and interest, if any, on this Security will be made at the office or agency of the Company maintained for that purpose in [the Borough of Manhattan, The City of New York], in [coin or currency], provided, however , that at the option of the Company payment of interest may be made by check mailed to the address of the person entitled thereto as such address shall appear in the Security Register.

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

[Seal]


INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED

By

SECTION 203. Form of Reverse of Security .

INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED

[Title of the Security]

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of _______________ (herein called the “Indenture”), among the Company, Ingersoll-Rand Company Limited ( herein called the “Guarantor”, which term includes any successor guarantor under the Indenture) and Wells Fargo Bank, N.A., as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Guarantor, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof, limited in aggregate principal amount to ___________.

[If applicable, insert – The Securities of this series are subject to redemption upon not less than 30 or more than 60 days’ notice by mail to the Holders of such Securities at their addresses in the Security Register for such series, [if applicable, insert – (1) on __________ in any year commencing with the year ____ and ending with the year ____ through operation of the sinking fund for this series at a Redemption Price equal to 100% of the principal amount, and (2)] at any time [on or after _________________, 20__], as a whole or in part, at the election of the Company, at the following Redemption Prices (expressed as percentages of the principal amount):

If redeemed [on or before _____________, ____% and if redeemed] during the 12-month period beginning ____________________:


Year	Redemption Price	Year	Redemption Price

and thereafter at a Redemption Price equal to _____% of the principal amount, together in the case of any such redemption [if applicable, insert – (whether through operation of the sinking fund or otherwise)] with accrued and unpaid interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor Securities, of record at the close of business on the relevant Record Dates referred to on the face hereof, all as provided in the Indenture.]

[If applicable, insert – The Securities of this series are subject to redemption upon not less than 30 or more than 60 days’ notice by mail to the Holders of such Securities at their addresses in the Security Register for such series, (1) on ________________ in any year commencing with the year ____ and ending with the year _____ through operation of the sinking fund for this series at the Redemption Prices for redemption through operation of the sinking fund (expressed as percentages of the principal amount) set forth in the table below, and (2) at any time [on or after ________________], as a whole or in part, at the election of the Company, at the Redemption Prices for redemption otherwise than through operation of the sinking fund (expressed as percentages of the principal amount) set forth in the table below:

If redeemed during the 12-month period beginning ______________________:


Year	Redemption Price For Redemption Through Operation of the Sinking Fund	Redemption Price For Redemption Otherwise Than Through Operation of the Sinking Fund

and thereafter at a Redemption Price equal to _______% of the principal amount, together in the case of any such redemption (whether through operation of the sinking fund or otherwise) with accrued and unpaid interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities or one or more Predecessor Securities of record at the close of business on the relevant Record Dates referred to on the face hereof all as provided in the Indenture.]

[If applicable, insert – The Securities of this series are subject to redemption upon not less than 30 or more than 60 days’ notice by mail to the Holders of such Securities at their addresses in the Security Register for such series, at any time, as a whole or in part, at the election of the Company, at a Redemption Price equal to the greater of:

(i) 100% of the principal amount of the Securities to be redeemed, or

(ii) as determined by the Quotation Agent (as defined below), the sum of the present values of the remaining scheduled payments of principal and interest on the Securities to be redeemed (not including any portion of payments of interest accrued as of the Redemption Date) from the Redemption Date to the date of Maturity, discounted to the Redemption Date on a semi-annual basis assuming a 360-day year consisting of twelve 30-day months at a discount rate equal to the Adjusted Treasury Rate (as defined below) plus ___ basis points.

Interest will cease to accrue on the Securities or portions of the Securities called for redemption on and after the Redemption Date.

“Adjusted Treasury Rate” means, with respect to any Redemption Date, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.

“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Securities to be redeemed that would be used, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Securities.

“Comparable Treasury Price” means, with respect to any Redemption Date, (i) the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of the Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than four Reference Treasury Dealer Quotations, the average of the Reference Treasury Dealer Quotations so received.

“Quotation Agent” means J.P. Morgan Securities Inc.

“Reference Treasury Dealer” means (i) each of Credit Suisse Securities (USA) LLC, Goldman, Sachs & Co. and J.P. Morgan Securities Inc., and their respective successors, unless any of them ceases to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), in which case the Company shall substitute another Primary Treasury Dealer, and (ii) any other Primary Treasury Dealers selected by the Quotation Agent.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by that Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding that Redemption Date.]

[Notwithstanding the foregoing, the Company may not prior to _____________ redeem any Securities of this series as contemplated by [Clause (2) of] the preceding paragraph as a part of, or in anticipation of, any refunding operation by the application, directly or indirectly, of moneys borrowed having an interest cost to the Company (calculated in accordance with generally accepted financial practice) of less than ______% per annum.]

[The sinking fund for this series provides for the redemption on ________________ in each year beginning with the year ________ and ending with the year _______ of [not less than] _________ [(“mandatory sinking fund”) and, at the option of the Company, not more than _______] aggregate principal amount of Securities of this series. [Securities of this series acquired or redeemed by the Company otherwise than through [mandatory] sinking fund payments may be credited against subsequent [mandatory] sinking fund payments otherwise required to be made in the order in which they become due.]

[In the event of redemption of this Security in part only, a new Security or Securities of this series for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.]

The Securities of this series are subject to redemption upon the occurrence of a Change of Control Triggering Event. Unless the Company has exercised its right to redeem this Security in full as described above, the Indenture provides that each Holder of the Securities of this series will have the right to require the Company to purchase all or a portion of such Holder’s Securities of this series pursuant to the offer described below (the “Change of Control Offer”) at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of purchase, subject to the rights of Holders of Securities of this series on the relevant record date to receive interest due on the relevant Interest Payment Date.

Within 30 days following the date upon which the Change of Control Triggering Event occurred, or at the Company’s option, prior to any Change of Control but after the public announcement of the pending Change of Control, the Company will be required to send, by first class mail, a notice to each Holder of the Securities of this series, with a copy to the Trustee, which notice will govern the terms of the Change of Control Offer. Such notice will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date such notice is mailed, other than as may be required by law (the “Change of Control Payment Date”). The notice, if mailed prior to the date of consummation of the Change of Control, will state that the Change of Control Offer is conditioned on the Change of Control being consummated on or prior to the Change of Control Payment Date.

Holders electing to have Securities purchased pursuant to a Change of Control Offer will be required to surrender their Securities, with the form below entitled “Option of Holder to Elect Purchase” completed, to the Paying Agent at the address specified in the notice, or transfer their Securities to the Paying Agent by book-entry transfer pursuant to the applicable procedures of the Paying Agent, prior to the close of business on the third business day prior to the Change of Control Payment Date.

On the Change of Control Payment Date, the Company will, to the extent lawful:

accept for payment all Securities of this series (or portions of Securities of this series) properly tendered pursuant to the Change of Control Offer;

deposit with the Paying Agent an amount equal to the aggregate payment in respect of all Securities of this series (or portions of Securities of this series) properly tendered pursuant to the Change of Control Offer; and

deliver or cause to be delivered to the Trustee the Securities of this series properly accepted for purchase, together with an officer’s certificate stating the aggregate principal amount of Securities of this series (or portions of Securities of this series) being purchased.

The Paying Agent will promptly mail to each Holder of properly tendered Securities the purchase price for the Securities, and the Trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder new Securities equal in principal amount to any unpurchased portion of any Securities surrendered; provided , that each new Security will be in a principal amount of $2,000 or an integral multiple of $1,000 thereof.

The Company will not be required to make a Change of Control Offer if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for such an offer made by the Company and such third party purchases all properly tendered Securities of this series not withdrawn under its offer.

The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the purchase of the Securities of this series as a result of a Change of Control Triggering Event. To the extent that the provisions of any such securities laws or regulations conflict with the Change of Control Offer provisions of the Securities of this series, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control Offer provisions of the Securities of this series by virtue of such conflict.

For purposes of the Change of Control Offer provisions of the Securities, the following terms will be applicable:

“Below Investment Grade Rating Event” means the Securities of this series cease to be rated Investment Grade by at least two of the three Rating Agencies on any date during the Trigger Period.

“Change of Control” means the occurrence of any one of the following:

the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Guarantor and its subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d) and Section 14(d) of the Exchange Act) other than to the Guarantor or one of its subsidiaries;

the consummation of any transaction (including without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d) and Section 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the outstanding Voting Stock of the Guarantor, or other Voting Stock into which the Voting Stock of the Guarantor is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares;

the first day on which the majority of the members of the board of directors of the Guarantor cease to be Continuing Directors;

IR Limited consolidates with, or merges with or into, any person, or any person consolidates with, or merges with or into, IR Limited, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of IR Limited or such other person is converted into or exchanged for cash, securities or other property, other than any such transaction where the shares of the Voting Stock of IR Limited outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, a majority of the Voting Stock of the surviving person immediately after giving effect to such transaction;

the adoption of a plan relating to the liquidation or dissolution of IR Limited; or

the failure of IR Limited to own, directly or indirectly, at least 51% of the Voting Stock of the Company.

Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control under clause (2) above if (i) the Guarantor becomes a direct or indirect wholly-owned subsidiary of a holding company and (ii) the direct or indirect holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of the Voting Stock of the Guarantor immediately prior to that transaction.

“Continuing Director” means, as of any date of determination, any member of the board of directors of the Guarantor who: (1) was a member of such board of directors on the date of the issuance of the Securities of this series; or (2) was nominated for election or elected to such board of directors with the approval of a majority of the Continuing Directors who were members of such board of directors at the time of such nomination or election.

“Fitch” means Fitch Inc., a subsidiary of Fimalac, S.A., and its successors.

“Moody’s” means Moody’s Investors Service, Inc., a subsidiary of Moody’s Corporation, and its successors.

of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, selected by the Company as a replacement agency for Moody’s, S&P or Fitch, or any of them, as the case may be, with respect to making a rating of the Securities of such series.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.

“Trigger Period” means the period commencing 60 days prior to the first public announcement by the Guarantor of any Change of Control (or pending Change of Control) and ending 60 days following the consummation of such Change of Control (which Trigger Period will be extended if the rating of the Securities of this series is under publicly announced consideration for possible downgrade by any Rating Agency on such 60th day, such extension to last with respect to each Rating Agency until the date on which such Rating Agency considering such possible downgrade either (x) rates the Securities of this series below Investment Grade or (y) publicly announces that it is no longer considering the Securities of this series for possible downgrade; provided , that no such extension will occur if on such 60th day the Securities of this series are rated Investment Grade not subject to review for possible downgrade by any Rating Agency).

The Indenture contains provisions for defeasance of (a) the entire indebtedness of this Security and (b) certain restrictive covenants upon compliance by the Company with certain conditions set forth therein.

[If the Security is not an Original Issue Discount Security, insert – If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.]

[If the Security is an Original Issue Discount Security, insert – If an Event of Default with respect to Securities of this series shall occur and be continuing, an amount of principal of the Securities of this series (the “Acceleration Amount”) may be declared due and payable in the manner and with the effect provided in the Indenture. In case of a declaration of acceleration on or before _______, ________ or on _______in any year, the Acceleration Amount per principal amount at Stated Maturity of the Securities shall be equal to the amount set forth in respect of such date below:


Date of declaration		Acceleration Amount per principal amount at Stated Maturity

and in case of a declaration of acceleration on any other date, the Acceleration Amount shall be equal to the Acceleration Amount as of the next preceding date set forth in the table above, plus accrued original issue discount (computed in accordance with generally accepted accounting principles in effect on __________) from such next preceding date to the date of declaration at the yield to maturity. For the purpose of this computation the yield to maturity is ______%. Upon payment (i) of the Acceleration Amount so declared due and payable and (ii) of interest on any overdue principal and overdue interest (in each case to the extent that the payment of such interest shall be legally enforceable), all of the Company’s obligations in respect of the payment of the principal of and interest, if any, on the Securities of this series shall terminate.]

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the Guarantor and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company, the Guarantor and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time Outstanding of all series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities at the time Outstanding of all series to be affected, on behalf of the Holders of all Securities of such series, to waive compliance by the Company and the Guarantor with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of (and premium, if any, on) and interest, if any, on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of (and premium, if any, on) and interest, if any, on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Securities of this series, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

The Securities of this series are issuable only in registered form without coupons in denominations of _____________ and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series of a different authorized denomination, as requested by the Holder surrendering the same.

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

Prior to due presentment of this Security for registration of transfer, the Company [,the Guarantor,] the Trustee and any agent of the Company [, the Guarantor] or the Trustee may treat the person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and none of the Company [, the Guarantor,] the Trustee or any such agent shall be affected by notice to the contrary.

No recourse for the payment of the principal of (and premium, if any, on) or interest, if any, on this Security [or the Guarantee endorsed hereon], or for any claim based hereon or thereon or otherwise in respect hereof or thereof, and no recourse under or upon any obligation, covenant or agreement of the Company or the Guarantor in the Indenture or in any indenture supplemental thereto, or in any Security [or in the Guarantee], or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, shareholder, officer or director, as such, past, present or future, of the Company [or the Guarantor] or of any successor corporation, either directly or through the Company [or the Guarantor] or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

In the event that a provision of this Security conflicts with the Indenture, the terms of the Indenture will govern.

Option of Holder to Elect Purchase

If you want to elect to have this Security purchased by the Company pursuant to Section 1108 of the Indenture, check the box below:

If you want to elect to have only part of the Security purchased by the Company pursuant to Section 1108 of the Indenture, state the amount you elect to have purchased:

$___________

Date:_______________



Your Signature:
		(Sign exactly as your name appears on the face of this Security)

Tax Identification No.: _______________________



Signature Guarantee:**

**	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee)

SECTION 204. Form of Trustee’s Certificate of Authentication .

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

Dated:


WELLS FARGO BANK, N.A., as Trustee

By
		Authorized Signatory

SECTION 205. Securities in Global Form .

If any Security of a series is issuable in global form, such Global Security may provide that it shall represent the aggregate amount of Outstanding Securities from time to time endorsed thereon and may also provide that the aggregate amount of Outstanding Securities represented thereby may from time to time be reduced to reflect exchanges. Any endorsement of a Global Security to reflect the amount, or any increase or decrease in the amount, of Outstanding Securities represented thereby shall be made by the Trustee of such series of Securities and in such manner as shall be specified in such Global Security. Any instructions by the Company with respect to a Global Security, after its initial issuance, shall be in writing but need not comply with Section 102.

None of the Company, the Guarantor, the Trustee of such series of Securities, any Paying Agent or the Security Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

SECTION 206. Guarantee; Form of Guarantee .

The Guarantor by its execution of this Indenture hereby agrees with each Holder of a Security of each series authenticated and delivered by the Trustee of such series of Securities and with such Trustee on behalf of each such Holder, to be unconditionally bound by the terms and provisions of the Guarantee set forth below and authorizes such Trustee to confirm such Guarantee to the Holder of each such Security by its execution and delivery of each such Security, with such Guarantee endorsed thereon, authenticated and delivered by such Trustee.

The Guarantee to be endorsed on the Security shall, subject to Section 201, be in substantially the form set forth below:

GUARANTEE

INGERSOLL-RAND COMPANY LIMITED

For value received, Ingersoll-Rand Company Limited, a company duly organized and existing under the laws of Bermuda (herein called the “Guarantor”, which term includes any successor Person under the Indenture referred to in the Security upon which this Guarantee is endorsed), hereby irrevocably and unconditionally guarantees to the Holder of the Security upon which this Guarantee is endorsed and to the Trustee for itself and on behalf of each such Holder the due and punctual payment of the principal of (and premium, if any, on) and interest on such Security and the due and punctual payment of the sinking fund or analogous payments referred to therein, if any, when and as the same shall become due and payable, whether at the Stated Maturity, by declaration of acceleration, call for redemption or otherwise, according to the terms thereof and of the Indenture referred to therein, and all other amounts owed under the Indenture, all in accordance with and subject to the terms and limitations of the Security on which this Guarantee is endorsed and Article Thirteen of the Indenture. In case of the failure of Ingersoll-Rand Global Holding Company Limited, a company duly organized under the laws of Bermuda (herein called the “Company”, which term includes any successor Person under such Indenture), promptly to make any such payment of principal (and premium, if any) or interest or any such sinking fund or analogous payment, the Guarantor hereby agrees to cause any such payment to be made promptly when and as the same shall become due and payable, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, and as if such payment were made by the Company, subject to the terms and limitations of Article Thirteen of the Indenture.

This Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication of such Security shall have been manually executed by or on behalf of the Trustee under such Indenture.

All terms used in this Guarantee which are defined in such Indenture shall have the meanings assigned to them in such Indenture.

THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Executed and dated the date on this ___________ day of ________, 20___.


[Seal]	INGERSOLL-RAND COMPANY LIMITED

	By
		Name:
		Title:

	By:
		Name:
		Title:

Reference is made to Article Thirteen for further provisions with respect to the Guarantee.

ARTICLE THREE

- THE SECURITIES

SECTION 301. Amount Unlimited; Issuable in Series .

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

The Securities may be issued in one or more series. The terms of each series of Securities shall be established either by an Officer’s Certificate or by a supplemental indenture. If the terms of a series of Securities are to be established pursuant to an Officer’s Certificate, one or more duly appointed officers of the Company and one or more duly appointed officers of the Guarantor shall execute and deliver to the Trustee such Officer’s Certificate, acting pursuant to authority granted to such officers by the Board of Directors of the Company and by the Board of Directors of the Guarantor. If the terms of a series of Securities are to be established pursuant to a supplemental indenture, such supplemental indenture shall be entered into in accordance with the provisions of Section 901 hereof. Such Officer’s Certificate or supplemental indenture (including any exhibits thereto) shall establish:

(1) the title of the Securities of that series (which shall distinguish the Securities of that series from all other series of Securities);

(2) any limit upon the aggregate principal amount of the Securities of that series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of that series pursuant to Sections 304, 305, 306, 906, or 1107);

(3) the date or dates on which the principal of the Securities of that series is payable;

(4) the rate or rates (or the manner of calculation thereof) at which the Securities of that series shall bear interest, if any, the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest shall be payable and the Regular Record Date for the interest payable on any Interest Payment Date;

(5) the place or places where the principal of (and premium, if any, on) and interest, if any, on Securities of that series shall be payable and where such Securities may be registered or transferred;

(6) the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of that series may be redeemed, in whole or in part, at the option of the Company;

(7) the obligation, if any, of the Company to redeem or purchase Securities of that series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof, and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of that series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;

(8) the right, if any, of the Company to redeem or purchase Securities of that series and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of that series shall be redeemed or purchased, in whole or in part, pursuant to such right;

(9) if other than denominations of $2,000 and integral multiples of $1,000 in excess thereof, the denominations in which Securities of that series shall be issuable;

(10) if other than the principal amount thereof, the portion of the principal amount of Securities of that series which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 502;

(11) if other than such coin or currency of the United States of America, the currency or currency unit in which payment of the principal of (or premium, if any, on) or interest, if any, on the Securities of that series shall be payable or in which the Securities of that series shall be denominated and the particular provisions applicable thereto;

(12) if the principal of (and premium, if any, on) or interest, if any, on the Securities of that series are to be payable, at the election of the Company, the Guarantor or a Holder thereof, in a coin or currency other than that in which the Securities are stated to be payable, the period or periods within which, and the terms and conditions upon which, such election may be made;

(13) if the amount of payments of principal of (and premium, if any, on) or interest, if any, on the Securities of that series may be determined with reference to an index based on a coin or currency other than that in which the Securities are stated to be payable, the manner in which such amounts shall be determined;

(14) any provisions permitted by this Indenture relating to Events of Default or covenants of the Company with respect to such series of Securities (including deletions therefrom, modifications thereof or additions thereto, whether or not consistent with the Events of Default or covenants set forth herein);

(15) if the Securities of that series shall be issued in whole or in part in the form of one or more Global Securities and, in such case, the U.S. Depositary for such Global Security or Securities; the manner in which and the circumstances under which Global Securities representing Securities of that series may be exchanged for Securities in definitive form, if other than, or in addition to, the manner and circumstances specified in Section 305;

(16) whether the Securities of that series will be convertible into Common Shares of the Company and/or exchangeable for other Securities, and if so, the terms and conditions upon which such Securities will be so convertible or exchangeable, and any deletions from or modifications or additions to this Indenture to permit or to facilitate the issuance of such convertible or exchangeable Securities or the administration thereof;

(17) the applicability of any guarantees other than the Guarantee;

(18) if a Person other than Wells Fargo Bank, N.A. is to act as Trustee for the Securities of that series, the name and location of the Corporate Trust Office of such Trustee; and

(19) any other terms of that series (which terms shall not be inconsistent with the provisions of this Indenture).

All Securities of any particular series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to such Board Resolution of the Company and the Guarantor and set forth in such Officer’s Certificate or in any such indenture supplemental hereto.

If any of the terms of the series, including the form of Security of such series, are established by action taken pursuant to a Board Resolution of the Company and a Board Resolution of the Guarantor, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and the Secretary or Assistant Secretary of the Guarantor and delivered to the Trustee for the Securities of such series at or prior to the delivery of the Company Order contemplated by Section 303 for the authentication and delivery of such series of Securities.

SECTION 302. Denominations .

The Securities of each series shall be issuable in registered form without coupons in such denominations as shall be specified as contemplated by Section 301. In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $2,000 and integral multiples of $1,000 in excess thereof.

SECTION 303. Execution, Authentication, Delivery and Dating .

The Securities shall be executed, manually or by facsimile, on behalf of the Company by its Chairman of the Board of Directors, its President, one of its Vice Presidents or its Treasurer under its corporate seal reproduced thereon, by facsimile or otherwise, and which need not be attested.

The Guarantee endorsed on any Securities shall be executed, manually or by facsimile, on behalf of the Guarantor by its Chairman of the Board of Directors, its President or one of its Vice Presidents and by its Treasurer or one of its Assistant Treasurers or its Secretary or one of its Assistant Secretaries, under its corporate seal reproduced thereon, by facsimile or otherwise, and which need not be attested.

Securities or the Guarantee bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company or the Guarantor, as the case may be, shall bind the Company or the Guarantor, as the case may be, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or the Guarantee or did not hold such offices at the date of such Securities or the Guarantee.

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for the Securities of such series for authentication, together with a Company Order for the authentication and delivery of such Securities, and such Trustee in accordance with the Company Order shall authenticate and deliver such Securities. If the form or terms of the Securities of the series have been established in or pursuant to one or more Board Resolutions of the Company and of the Guarantor, as the case may be, as permitted by Sections 201 and 301, in authenticating such Securities and accepting the additional responsibilities under this Indenture in relation to such Securities, such Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel of the Company and the Guarantor, as the case may be, stating:

(a) if the form of such Securities has been established by or pursuant to Board Resolution of the Company as permitted by Section 201, that such form has been established in conformity with the provisions of this Indenture;

(b) if the terms of such Securities have been established by or pursuant to Board Resolution of the Company and of the Guarantor, as the case may be, as permitted by Section 301, that such terms have been established in conformity with the provisions of this Indenture;

(c) that such Securities and the Guarantee endorsed thereon, when authenticated and delivered by such Trustee and issued by the Company and the Guarantor, as the case may be, in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company and the Guarantor, as the case may be, respectively, enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting the enforcement of creditors’ rights and to general equity principles; and

(d) that all laws and requirements in respect of the execution and delivery by the Company of such Securities and by the Guarantor of each Guarantee have been complied with.

If such form or terms have been so established, the Trustee for the Securities of such series shall not be required to authenticate such Securities if such Trustee, being advised by counsel, determines that the issue of such Securities pursuant to this Indenture will affect such Trustee’s own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to such Trustee.

Notwithstanding the foregoing, if not all the Securities of any series are to be issued at one time, it shall not be necessary to deliver the Officer’s Certificate otherwise required pursuant to the foregoing or the Company Order and Opinion of Counsel otherwise required pursuant to the foregoing prior to or at the time of issuance of each Security, but such documents shall be delivered prior to or at the time of issuance of the first Security of such series.

Each Security shall be dated the date of its authentication.

No Security or Guarantee endorsed thereon shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein executed by the Trustee for the Securities of such series by manual signature, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and, together with the Guarantee, if any, endorsed thereon, is entitled to the benefits of this Indenture.

SECTION 304. Temporary Securities .

Pending the preparation of definitive Securities of any particular series, the Company may execute, and upon Company Order the Trustee for the Securities of such series shall authenticate and deliver temporary Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued and having endorsed thereon a Guarantee executed by the Guarantor of the tenor of the definitive Guarantee, and with such appropriate insertions, omissions, substitutions and other variations as the officer executing such Securities may determine, as evidenced by his or her execution of such Securities.

If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series the Company shall execute and the Trustee for the Securities of such series shall authenticate and deliver in exchange therefor a like principal amount of definitive Securities of

the same series of authorized denominations and having endorsed thereon the Guarantee by the Guarantor. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series.

SECTION 305. Registration, Registration of Transfer and Exchange .

The Company shall cause to be kept at the Corporate Trust Office of the Trustee for the Securities of each series a register (the register maintained at such office and in any other office or agency of the Company in a Place of Payment being herein sometimes collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee for the Securities of each series is hereby appointed “Security Registrar” for the purpose of registering Securities and transfers of Securities as herein provided.

Upon surrender for registration of transfer of any Security of any series at the office or agency in a Place of Payment for that series, the Company shall execute, and the Trustee for the Securities of each series shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series, of any authorized denominations and of a like aggregate principal amount, and having endorsed thereon a Guarantee executed by the Guarantor.

At the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount, upon surrender of the Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee for the Securities of such series shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive, and having endorsed thereon a Guarantee executed by the Guarantor.

All Securities and the Guarantee endorsed thereon issued upon any registration of transfer or exchange of Securities and the Guarantee endorsed thereon, shall be the valid obligations of the Company and the Guarantor, respectively evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities and the Guarantee endorsed thereon surrendered upon such registration of transfer or exchange.

Every Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee for the Securities of such series) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed, by the Holder thereof or his or her attorney duly authorized in writing.

No service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Sections 304, 906 or 1107 not involving any transfer.

The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 1103 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.

If the Company shall establish pursuant to Section 301 that the Securities of a series are to be issued in whole or in part in the form of one or more Global Securities, then the Company shall execute (along with a Guarantee executed by the Guarantor endorsed thereon) and the Trustee for the Securities of such series shall, in accordance with Section 303 and the Company Order with respect to such series, authenticate and deliver one or more Global Securities in temporary or permanent form that (i) shall represent and shall be denominated in an amount equal to the aggregate principal amount of the Outstanding Securities of such series to be represented by one or more Global Securities, (ii) shall be registered in the name of the U.S. Depositary for such Global Security or Securities or the nominee of such depositary, and (iii) shall bear a legend substantially to the following effect: “This Security (and the related Guarantee) may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary, unless and until this Security is exchanged in whole or in part for Securities in definitive form” and such other legend as may be required by the U.S. Depositary.

Notwithstanding any other provision of this Section, unless and until it is exchanged in whole or in part for Securities in definitive form, a Global Security (and the related Guarantee) representing all or a portion of the Securities of a series may not be transferred except as a whole by the U.S. Depositary for such series to a nominee of such depositary or by a nominee of such depositary to such depositary or another nominee of such depositary or by such depositary or any such nominee to a successor U.S. Depositary for such series or a nominee of such successor depositary.

If at any time the U.S. Depositary for the Securities of a series notifies the Company that it is unwilling or unable to continue as U.S. Depositary for the Securities of such series or if any time the U.S. Depositary for Securities of a series shall no longer be a clearing agency registered and in good standing under the Exchange Act, or other applicable statute or regulation, the Company shall appoint a successor U.S. Depositary with respect to the Securities of such series. If a successor U.S. Depositary for the Securities of such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, the Company will execute, and the Trustee for the Securities of such series, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, will authenticate and deliver, Securities of such series in definitive form in an aggregate principal amount equal to the principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities and having endorsed thereon a Guarantee executed by the Guarantor.

The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more Global Securities shall no longer be represented by such Global Security or Securities. In such event, the Company will execute, and the Trustee for the Securities of such series, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, will authenticate and deliver, Securities of such Series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities and having endorsed thereon a Guarantee executed by the Guarantor.

If the Securities of any series shall have been issued in the form of one or more Global Securities and if an Event of Default with respect to the Securities of such series shall have occurred and be continuing, the Company will promptly execute, and the Trustee for the Securities of such series, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, will authenticate and deliver Securities of such series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities and having endorsed thereon a Guarantee executed by the Guarantor.

If specified by the Company pursuant to Section 301 with respect to Securities of a series, the U.S. Depositary for such series of Securities may surrender a Global Security for such series of Securities in exchange in whole or in part for Securities of such series in definitive form on such terms as are acceptable to the Company and such depositary. Thereupon, the Company shall execute and the Trustee for the Securities of such series shall authenticate and deliver, without charge:

(i) to each Person specified by the U.S. Depositary a new registered Security or Securities of the same series, of an authorized denomination as requested by such Person in an aggregate principal amount equal to and in exchange for such Person’s beneficial interest in the Global Security and having endorsed thereon a Guarantee executed by the Guarantor; and

(ii) to the U.S. Depositary a new Global Security in a denomination equal to the difference, if any, between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities delivered to Holders thereof and having endorsed thereon a Guarantee executed by the Guarantor.

Upon the exchange of a Global Security in whole for Securities in definitive form, such Global Security shall be canceled by the Trustee for the Securities of such series. Securities issued in exchange for a Global Security shall be registered in such names and in such authorized denominations as the U.S. Depositary for such Global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee for the Securities of such series. Such Trustee shall deliver such Securities to the Persons in whose names such Securities are so registered.

SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities .

If any mutilated Security is surrendered to the Trustee for the series of such Securities, the Company shall execute and such Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding, and having endorsed thereon a Guarantee executed by the Guarantor.

If there shall be delivered to the Company and the Trustee for the series of such Securities (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or such Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and upon its request such Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding, and having endorsed thereon a Guarantee executed by the Guarantor.

In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee for the series of such Securities) connected therewith.

Every new Security of any series and the Guarantee endorsed thereon, issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company and the Guarantor, respectively, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that series duly issued hereunder.

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

SECTION 307. Payment of Interest; Interest Rights Preserved .

Interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest.

Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in Clause (1) or (2) below:

(1) The Company may elect to make payment of any Defaulted Interest to the persons in whose names the Securities of such series (or their

respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee for the Securities of such series in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with such Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements reasonably satisfactory to such Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the persons entitled to such Defaulted Interest as in this Clause provided. Thereupon such Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by such Trustee of the notice of the proposed payment. Such Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Securities of such series at his or her address as it appears in the Security Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following Clause (2).

(2) The Company may make payment of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee for the Securities of such series of the proposed payment pursuant to this Clause, such manner of payment shall be deemed practicable by such Trustee.

Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

SECTION 308. Persons Deemed Owners .

Prior to due presentment of a Security for registration of transfer, the Company, the Guarantor, the Trustee for such Security and any agent of the Company, the Guarantor or such Trustee may treat the person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of (and premium, if any, on) and (subject to Section 307) interest, if any, on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and none of the Company, the Guarantor, such Trustee or any agent of the Company, the Guarantor or such Trustee shall be affected by notice to the contrary.

Notwithstanding the foregoing, with respect to any Global Security, nothing herein shall prevent the Company, the Guarantor, the Trustee for such Security, or any agent of any of the foregoing, from giving effect to any written certification, proxy or other authorization furnished by any depositary, as a Holder, with respect to such Global Security or impair, as between such depositary and owners of beneficial interests in such Global Security, the operation of customary practices governing the exercise of the rights of such depositary (or its nominee) as Holder of such Global Security.

SECTION 309. Cancellation .

All Securities surrendered for payment, redemption, registration of transfer or exchange or for credit against any sinking fund payment shall, if surrendered to any person other than the Trustee for such Securities, be delivered to such Trustee and shall be promptly cancelled by it. The Company or the Guarantor may at any time deliver to such Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company or the Guarantor may have acquired in any manner whatsoever, and all Securities so delivered shall be promptly cancelled by such Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by such Trustee shall be disposed of in accordance with such Trustee’s customary practices.

SECTION 310. Computation of Interest .

Except as otherwise specified as contemplated by Section 301 for Securities of any particular series, interest, if any, on the Securities of each series shall be computed on the basis of a year of twelve 30-day months.

SECTION 311. CUSIP Numbers .

The Company in issuing the Securities may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee for such Securities shall use “CUSIP” numbers in notices of redemption as a convenience to Holders of such Securities; provided , that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee in writing of any change in the “CUSIP” numbers.

ARTICLE FOUR

- SATISFACTION AND DISCHARGE

SECTION 401. Satisfaction and Discharge of Indenture .

This Indenture shall upon Company Request cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly

provided for), and the Trustee for the Securities of each series, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when:

(1) either:

(A) all Securities theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 306 and (ii) Securities for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company or the Guarantor and thereafter repaid to the Company or the Guarantor, or discharged from such trust, as provided in Section 1003) have been delivered to the Trustee for the Securities of such series for cancellation; or

(B) all such Securities not theretofore delivered to the Trustee for the Securities of such series for cancellation:

(i) have become due and payable; or

(ii) will become due and payable at their Stated Maturity within one year; or

(iii) are to be called for redemption within one year under arrangements reasonably satisfactory to such Trustee for the giving of notice of redemption by such Trustee in the name, and at the expense, of the Company or the Guarantor; or

(iv) are deemed paid and discharged pursuant to Section 403, as applicable,

and the Company or the Guarantor, in the case of (i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee for the Securities of such series as trust funds in trust for the purpose an amount of (a) money, or (b) in the case of (ii) or (iii) above and (except as provided in an indenture supplemental hereto) if no Securities of any series Outstanding are subject to repurchase at the option of Holders, (I) U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide not later than one day before the Stated Maturity or Redemption Date, as the case may be, money in an amount, or (II) a combination of money or U.S. Government Obligations as provided in (I) above, in each case sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to such Trustee for cancellation, for principal (and premium, if any) and interest, if any, to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;

(2) the Company or the Guarantor has paid or caused to be paid all other sums payable hereunder by the Company; and

(3) the Company or the Guarantor has delivered to the Trustee for the Securities of such series an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee of the Securities of each series under Section 607, the obligations of the Trustee to any Authenticating Agent under Section 614 and, if money or U.S. Government Obligations shall have been deposited with the Trustee of the Securities of any series pursuant to Subclause (B) of Clause (1) of this Section or if money or U.S. Government Obligations shall have been deposited with or received by the Trustee of the Securities of any series pursuant to Section 403, the obligations of such Trustee under Section 402 and the last paragraph of Section 1003 shall survive.

SECTION 402. Application of Trust Money .

(a) Subject to the provisions of the last paragraph of Section 1003, all money or U.S. Government Obligations deposited with the Trustee of a particular series of Securities pursuant to Section 401, 403 or 1006 and all money received by the Trustee of a particular series of Securities in respect of U.S. Government Obligations deposited with the Trustee of that series of Securities pursuant to Section 401, 403 or 1006, shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company or the Guarantor acting as its own Paying Agent) as such Trustee may determine, to the persons entitled thereto, of the principal (and premium, if any) and interest, if any, for whose payment such money has been deposited with or received by such Trustee or to make mandatory sinking fund payments or analogous payments as contemplated by Section 401, 403 or 1006.

(b) The Company and the Guarantor shall pay and shall indemnify the Trustee of each series of Securities against any tax, fee, or other charge imposed on or assessed against U.S. Government Obligations deposited pursuant to Section 401, 403 or 1006 or the interest and principal received in respect of such obligations other than any payable by or on behalf of Holders.

(c) The Trustee of each series of Securities shall deliver or pay to the Company or the Guarantor from time to time upon Company Request any U.S. Government Obligations or money held by it as provided in Section 401, 403 or 1006 which, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to such Trustee, are then in excess of the amount thereof which then would have been required to be deposited for the purpose for which such U.S. Government Obligations or money was deposited or received. This provision shall not authorize the sale by such Trustee of any U.S. Government Obligations held under this Indenture.

SECTION 403. Satisfaction, Discharge and Defeasance of Securities of any Series .

The Company and the Guarantor shall be deemed to have paid and discharged the entire indebtedness on all the Outstanding Securities of any series and the Guarantee, respectively, on the 91 ^st day after the date of the deposit referred to in subparagraph (a) hereof, and the provisions of this Indenture, as it relates to such Outstanding Securities of such series and the Guarantee, respectively, shall no longer be in effect (and the Trustee for the Securities of such series, at the expense of the Company or the Guarantor, shall at Company Request execute proper instruments acknowledging the same), except as to:

(1) the rights of Holders of Securities of such series to receive, from the trust funds described in subparagraph (a) hereof, (i) payment of the principal of (and premium, if any, on) and each installment of principal of (and premium, if any, on) or interest, if any, on the Outstanding Securities of such series on the Stated Maturity of such principal or installment of principal or interest or to and including the Redemption Date irrevocably designated by the Company pursuant to subparagraph (e) hereof and (ii) the benefit of any mandatory sinking fund payments applicable to the Securities of such series on the day on which such payments are due and payable in accordance with the terms of this Indenture and the Securities of such series;

(2) the Company’s obligations with respect to such Securities of such series under Sections 305, 306, and 1002 and, if the Company shall have irrevocably designated a Redemption Date pursuant to subparagraph (e) hereof, Sections 1101, 1104 and 1106 as they apply to such Redemption Date;

(3) the Company’s obligations with respect to the Trustee for Securities of such series under Section 607; and

(4) the rights, powers, trust and immunities of such Trustee hereunder and the duties of such Trustee under Section 402 and, if the Company shall have irrevocably designated a Redemption Date pursuant to subparagraph (e) hereof, Article Eleven and the duty of such Trustee to authenticate Securities of such series on registration of transfer or exchange;

provided , that the following conditions shall have been satisfied:

(a) the Company or the Guarantor has deposited or caused to be irrevocably deposited (except as provided in Section 402(c) and the last paragraph of Section 1003) with such Trustee as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities of such series, (i) money in an amount, or (ii) (except as provided in a supplemental indenture with respect to such series) if Securities of such series are not subject to repurchase at the option of Holders, (A) U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide not later than one day before the due date of any payment referred to in Clause (x) or (y) of this subparagraph (a) money in an amount or (B) a combination thereof, sufficient, in the opinion of a

nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to such Trustee, to pay and discharge (x) the principal of (and premium, if any, on) and each installment of principal of (and premium, if any, on) and interest, if any, on the Outstanding Securities of such series on the Stated Maturity of such principal or installment of principal or interest or to and including the Redemption Date irrevocably designated by the Company pursuant to subparagraph (e) hereof and (y) any mandatory sinking fund payments applicable to the Securities of such series on the day on which such payments are due and payable in accordance with the terms of the Indenture and of the Securities of such series;

(b) the Company or the Guarantor has delivered to such Trustee an Opinion of Counsel to the effect that such provision would not cause any Outstanding Securities of such series then listed on any national securities exchange to be delisted as a result thereof;

(c) no Event of Default or event which with notice or lapse of time would become an Event of Default (including by reason of such deposit) with respect to the Securities of such series shall have occurred and be continuing on the date of such deposit or during the period ending on the 91 ^st day after such date;

(d) the Company or the Guarantor has delivered to such Trustee an Opinion of Counsel in the U.S. to the effect that the Company or the Guarantor has received from, or there has been published by the Internal Revenue Service a ruling to the effect that Holders of the Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit, defeasance and discharge; and

(e) if the Company or the Guarantor has deposited or caused to be deposited money or U.S. Government Obligations to pay or discharge the principal of (and premium, if any, on) and interest, if any, on the Outstanding Securities of a series to and including a Redemption Date on which all of the Outstanding Securities of such series are to be redeemed, such Redemption Date shall be irrevocably designated by a Board Resolution of the Company delivered to such Trustee on or prior to the date of deposit of such money or U.S. Government Obligations, and such Board Resolution shall be accompanied by an irrevocable Company Request that such Trustee give notice of such redemption in the name and at the expense of the Company or the Guarantor and less than 30 nor more than 60 days prior to such Redemption Date in accordance with Section 1104.

SECTION 404. Reinstatement .

If the Trustee of the Securities of any series or any Paying Agent is unable to apply any money in accordance with Section 402 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the obligations of the Company and the Guarantor under this Indenture and such Securities and any related coupons and the Guarantee shall be revived and reinstated as though no deposit had occurred pursuant to Section 403 or Section 1006, as the case may be, until such time as such Trustee or Paying Agent is permitted to apply all such money in accordance with Section 402;

provided , however , that if the Company makes any payment of principal of (or premium, if any, on) or interest, if any, on any such Security or any related coupon following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities and any related coupons to receive such payment from the money held by such Trustee or Paying Agent.

ARTICLE FIVE

- REMEDIES

SECTION 501. Events of Default .

“Event of Default”, wherever used herein with respect to Securities of any series, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

(1) default in the payment of any interest on any Security of that series when it becomes due and payable and continuance of such default for a period of 30 days (subject to the deferral of any interest payment in the case of an extension period); or

(2) default in the payment of the principal of (or premium, if any, on) any Security of that series at its Maturity; or

(3) default in the payment of any sinking fund installment, when and as due by the terms of a Security of that series, and continuance of such default for a period of 30 days; or

(4) default in the performance, or breach, of any covenant or warranty of the Company or the Guarantor in this Indenture (other than a covenant or warranty a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of a series of Securities other than that series), and continuance of such default or breach for a period of 90 days after there has been given, by registered or certified mail, to the Company and the Guarantor by the Trustee for the Securities of such series or to the Company, the Guarantor and such Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of that series a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder; or

(5) the entry by a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company or the Guarantor in an involuntary case or proceeding under any applicable federal or state or Bermuda bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the Company or the Guarantor a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement,

adjustment or composition of or in respect of the Company or the Guarantor under any applicable federal or state or Bermuda law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or the Guarantor or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 90 consecutive days; or

(6) the commencement by the Company or the Guarantor of a voluntary case or proceeding under any applicable federal or state or Bermuda bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Company or the Guarantor to the entry of a decree or order for relief in respect of the Company or the Guarantor, respectively, in an involuntary case or proceeding under any applicable federal or state or Bermuda bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against the Company or the Guarantor, or the filing by the Company or the Guarantor of a petition or answer or consent seeking reorganization or relief under any applicable federal or state or Bermuda law, or the consent by the Company or the Guarantor to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or the Guarantor or of any substantial part of its property, or the making by the Company or the Guarantor of an assignment for the benefit of creditors, or the admission by the Company or the Guarantor in writing of its inability to pay its debts generally as they become due, or the taking of corporate action by the Company or the Guarantor in furtherance of any such action; or

(7) any other Event of Default provided in the supplemental indenture or provided in or pursuant to a Board Resolution or Officer’s Certificate of the Company and the Guarantor, under which such series of Securities is issued or in the form of Security for such series.

SECTION 502. Acceleration of Maturity; Rescission and Annulment .

If an Event of Default (other than an Event of Default specified in Section 501(5) or 501(6)) with respect to Securities of any series at the time Outstanding occurs and is continuing, then in every such case the Trustee for the Securities of such series or the Holders of not less than 25% in aggregate principal amount of the Outstanding Securities of that series may declare the principal amount (or, if the Securities of that series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of that series) of all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to such Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) shall become immediately due and payable. If an Event of Default specified in Section 501(5) or 501(6) with respect to Securities of any series at the time Outstanding occurs, the principal amount of all the Securities of that series (or, if any Securities of that series are Original Issue Discount Securities, such portion of the principal amount of such Securities as may be specified by the terms thereof) shall automatically, and without any declaration or other action on the part of such Trustee or any Holder, become immediately due and payable.

At any time after such a declaration of acceleration with respect to Securities of any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee for the Securities of such series as hereinafter in this Article provided, the Holders of a majority in aggregate principal amount of the Outstanding Securities of that series, by written notice to the Company, the Guarantor and such Trustee, may rescind and annul such declaration and its consequences if:

(1) the Company or the Guarantor has paid or deposited with such Trustee a sum sufficient to pay,

(A) all overdue interest, if any, on all Securities of that series,

(B) the principal of (and premium, if any, on) any Securities, of that series which have become due otherwise than by such declaration of acceleration and interest thereon at the rate or rates prescribed therefor in such Securities,

(C) to the extent that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Securities, and

(D) all sums paid or advanced by such Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel; and

(2) all Events of Default with respect to Securities of that series, other than the non-payment of the principal of and accrued interest on Securities of that series which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513.

No such rescission shall affect any subsequent default or impair any right consequent thereon.

For all purposes under this Indenture, if a portion of the principal of any Original Issue Discount Securities shall have been accelerated and declared due and payable pursuant to the provisions hereof, then, from and after such declaration, unless such declaration has been rescinded and annulled, the principal amount of such Original Issue Discount Securities shall be deemed, for all purposes hereunder, to be such portion of the principal thereof as shall be due and payable as a result of such acceleration, and payment of such portion of the principal thereof as shall be due and payable as a result of such acceleration, together with interest, if any, thereon and all other amounts owing thereunder, shall constitute payment in full of such Original Issue Discount Securities.

SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee .

The Company covenants that if:

(1) default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or

(2) default is made in the payment of the principal of (or premium, if any, on) any Security at the Maturity thereof,

the Company will, upon demand of the Trustee for the Securities of such series, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal (and premium, if any) and interest, if any, and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal (and premium, if any) and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel.

If the Company fails to pay such amounts forthwith upon such demand, such Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company, the Guarantor or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company, the Guarantor or any other obligor upon such Securities, wherever situated.

If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee for the Securities of such series may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as such Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

SECTION 504. Trustee May File Proofs of Claim .

In any case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company, the Guarantor or any other obligor upon the Securities or the property of the Company, the Guarantor or of such other obligor or their creditors, the Trustee for the Securities of such series (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether such Trustee shall have made any demand on the Company or the Guarantor for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(i) to file and prove a claim for the whole amount of principal (and premium, if any) and interest owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of such Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel) and of the Holders of such Securities allowed in such judicial proceeding; and

(ii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder of such Securities to make such payments to such Trustee and, in the event that such Trustee shall consent to the making of such payments directly to such Holders, to pay to such Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel, and any other amounts due such Trustee under Section 607.

Nothing herein contained shall be deemed to authorize the Trustee for the Securities of any series to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities, the Guarantee or the rights of any Holder thereof or to authorize such Trustee to vote in respect of the claim of any Holder in any such proceeding.

SECTION 505. Trustee May Enforce Claims Without Possession of Securities .

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee for any series of Securities without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by such Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

SECTION 506. Application of Money Collected .

Any money collected by the Trustee for any series of Securities pursuant to this Article shall be applied in the following order, at the date or dates fixed by such Trustee and, in case of the distribution of such money on account of principal (or premium, if any) or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

FIRST: to the payment of all amounts due such Trustee under Section 607;

SECOND: In case the principal of the Securities of such series in respect of which moneys have been collected shall not have become and be then due and payable, to the payment of interest, if any, on the Securities of such series in default in the order of the maturity of the installments of such interest, with interest (to the extent that such interest has been collected by such Trustee and to the extent permitted by law) upon the

overdue installments of interest at the rate prescribed therefor in such Securities, such payments to be made ratably to the persons entitled thereto, without discrimination or preference;

THIRD: In case the principal of the Securities of such series in respect of which moneys have been collected shall have become and shall be then due and payable, to the payment of the whole amount then owing and unpaid upon all the Securities of such series for principal and interest, if any, with interest upon the overdue principal, and (to the extent that such interest has been collected by such Trustee and to the extent permitted by law) upon overdue installments of interest at the rate prescribed therefor in the Securities of such series; and in case such moneys shall be insufficient to pay in full the whole amount so due and unpaid upon the Securities of such series, then to the payment of such principal and interest, without preference or priority of principal over interest, or of interest over principal, or of any installment of interest over any other installment of interest, or of any Security of such series over any other Security of such series, ratably to the aggregate of such principal and accrued and unpaid interest; and

FOURTH: To the payment of the remainder, if any, to the Company or any other person lawfully entitled thereto.

SECTION 507. Limitation on Suits .

No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

(1) such Holder has previously given written notice to the Trustee for the Securities of such series of a continuing Event of Default with respect to the Securities of that series;

(2) the Holders of not less than 25% in principal amount of the Outstanding Securities of that series shall have made written request to such Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

(3) such Holder or Holders have offered to such Trustee indemnity reasonably satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;

(4) such Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

(5) no direction inconsistent with such written request has been given to such Trustee during such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities of that series,

it being understood and intended that no one or more of such Holders shall have any right in any manner whatsoever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all such Holders.

SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest .

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of (and premium, if any, on) and (subject to Section 307) interest, if any, on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

SECTION 509. Restoration of Rights and Remedies .

If the Trustee for the Securities of any series or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to such Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Guarantor, such Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of such Trustee and the Holders shall continue as though no such proceeding had been instituted.

SECTION 510. Rights and Remedies Cumulative .

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 306, no right or remedy herein conferred upon or reserved to the Trustee for the Securities of any series or to any Holder is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

SECTION 511. Delay or Omission Not Waiver .

No delay or omission of the Trustee for the Securities of any series or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to such Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by such Trustee or by the Holders, as the case may be.

SECTION 512. Control by Holders .

The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee for the Securities of such series, or exercising any trust or power conferred on such Trustee, with respect to the Securities of such series; provided that:

(1) such direction shall not be in conflict with any rule of law or with this Indenture; and

(2) such Trustee may take any other action deemed proper by such Trustee which is not inconsistent with such direction.

SECTION 513. Waiver of Past Defaults .

The Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of any series may on behalf of the Holders of all of the Securities of such series waive any past default hereunder with respect to such series and its consequences, except a default:

(1) in the payment of the principal of (or premium, if any, on) or interest, if any, on any Security of such series; or

(2) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security of such series affected.

Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

SECTION 514. Undertaking for Costs .

All parties to this Indenture agree, and each Holder of any Security by his or her acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for the Securities of any series for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee for the Securities of any series, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the Outstanding Securities of any series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any, on) or interest, if any, on any Security on or after the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on or after the Redemption Date).

SECTION 515. Waiver of Stay or Extension Laws .

Each of the Company and the Guarantor covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time

hereafter in force, which may affect the covenants or the performance of this Indenture; and each of the Company and the Guarantor (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee for the Securities of any series, but will suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE SIX

- THE TRUSTEE

SECTION 601. Certain Duties and Responsibilities .

(a) Except during the continuance of an Event of Default with respect to the Securities of any series for which the Trustee is serving as such:

(1) such Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against such Trustee; and

(2) in the absence of bad faith on its part, such Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to such Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to such Trustee, such Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

(b) In case an Event of Default with respect to a series of Securities has occurred and is continuing, the Trustee for the Securities of such series shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

(c) No provision of this Indenture shall be construed to relieve the Trustee for the Securities of any series from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(1) this Subsection shall not be construed to limit the effect of Subsection (a) of this Section;

(2) such Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that such Trustee was negligent in ascertaining the pertinent facts;

(3) such Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Securities of any particular series, determined as provided in Section 512, relating to the time, method and place of conducting any proceeding for any remedy available to such Trustee, or exercising any trust or power conferred upon such Trustee, under this Indenture with respect to the Securities of that series; and

(4) no provision of this Indenture shall require the Trustee for any series of Securities to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

(d) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee for any series of Securities shall be subject to the provisions of this Section.

SECTION 602. Notice of Defaults .

Within 90 days after the occurrence of any default hereunder with respect to the Securities of any particular series, the Trustee for the Securities of such series shall transmit by mail to all Holders of Securities of that series, as their names and addresses appear in the Security Register for that series, notice of such default hereunder known to such Trustee, unless such default shall have been cured or waived; provided , however , that, except in the case of a default in the payment of the principal of (or premium, if any, on) or interest, if any, on any Security of that series or in the payment of any sinking fund installment with respect to Securities of that series, such Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors and/or Responsible Officers of such Trustee in good faith determines that the withholding of such notice is in the interest of the Holders of Securities of that series; and provided , further , that in the case of any default of the character specified in Section 501(4) with respect to Securities of that series, no such notice to Holders shall be given until at least 30 days after the occurrence thereof. For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Securities of that series.

Promptly (and in any event within 5 Business Days) upon the Company or the Guarantor becoming aware of any default hereunder with respect to the Securities of any particular series, such party is required to deliver to the Trustee a statement specifying such default hereunder and the actions which the Company or the Guarantor proposes to take with respect to such default hereunder.

SECTION 603. Certain Rights of Trustee .

Subject to the provisions of Section 601:

(a) the Trustee for any series of Securities may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

(b) any request or direction of the Company or the Guarantor mentioned herein shall be sufficiently evidenced by a Company Request or Company Order of the Company or the Guarantor and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution of the Company or the Guarantor;

(c) whenever in the administration of this Indenture such Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, such Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officer’s Certificate;

(d) such Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

(e) such Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders of Securities of any series pursuant to this Indenture for which it is acting as Trustee, unless such Holders shall have offered to such Trustee security or indemnity, reasonably satisfactory to it, against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;

(f) such Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but such Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if such Trustee shall determine to make such further inquiry or investigation, it shall be entitled upon reasonable request to examine the books, records and premises of the Company, personally or by agent or attorney;

(g) such Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and such Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder;

(h) the Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

(i) in no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action;

(j) the Trustee shall not be deemed to have notice of any default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture;

(k) the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder;

(l) the Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder; and

(m) the Trustee may request that the Company and the Guarantor deliver a certificate in the form set forth below setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.

SECTION 604. Not Responsible for Recitals or Issuance of Securities .

The recitals contained herein and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company and the Guarantor, and neither the Trustee for any series of Securities nor any Authenticating Agent assumes any responsibility for their correctness. The Trustee for any series of Securities makes no representations as to the validity or sufficiency of this Indenture or of the Securities. Neither the Trustee for any series of Securities nor any Authenticating Agent shall be accountable for the use or application by the Company of Securities or the proceeds thereof.

SECTION 605. May Hold Securities .

The Trustee for any series of Securities, any Authenticating Agent, any Paying Agent, any Calculation Agent, any Security Registrar or any other agent of the Company, the Guarantor or such Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 608 and 613, may otherwise deal with the Company or the Guarantor with the same rights it would have if it were not such Trustee, Authenticating Agent, Paying Agent, Calculation Agent, Security Registrar or such other agent.

SECTION 606. Money Held in Trust .

Money held by the Trustee for any series of Securities in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee for any series of Securities shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company or the Guarantor.

SECTION 607. Compensation and Reimbursement .

The Company agrees:

(1) to pay to the Trustee for any series of Securities from time to time such compensation for all services rendered by it hereunder as shall be agreed upon in writing from time to time by the Company and such Trustee (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

(2) except as otherwise expressly provided herein, to reimburse the Trustee for any series of Securities upon its request for all reasonable expenses, disbursements and advances incurred or made by such Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the reasonable expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and

(3) to indemnify such Trustee for, and to hold it harmless against, any and all loss, liability, damage, claim or expense (including taxes other than taxes based on the income of the Trustee) incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of this trust or trusts hereunder, including the costs and expenses of defending itself against any claim (whether asserted by the Company, the Guarantor, a Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder.

The Trustee for any series of Securities shall have a lien prior to the Securities as to all property and funds held by such Trustee hereunder for any amount owing it or any predecessor Trustee pursuant to this Section 607, except with respect to funds held in trust for the benefit of the Holders of such particular Securities.

When the Trustee for any series of Securities incurs expenses or renders services in connection with an Event of Default specified in Section 501(5) or Section 501(6), the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable federal or state bankruptcy, insolvency or other similar law.

The provisions of this Section shall survive the termination of this Indenture.

SECTION 608. Disqualification; Conflicting Interests .

If the Trustee for any series of Securities has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, such Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. In determining whether such Trustee has a conflicting interest as defined in Section 310(b) of the Trust Indenture Act with respect to the Securities of any series, there shall be excluded Securities of any particular series of Securities other than that series.

SECTION 609. Corporate Trustee Required; Different Trustees for Different Series; Eligibility .

There shall at all times be a Trustee hereunder for each series of Securities which shall be a corporation or bank organized and doing business under the laws of the United States of America, any State thereof, or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000 subject to supervision or examination by federal or state authority. If such corporation or bank publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time such Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.

A different Trustee may be appointed by the Company for each series of Securities prior to the issuance of such Securities. If the initial Trustee for any series of Securities is to be other than Wells Fargo Bank, N.A., the Company and such Trustee shall, prior to the issuance of such Securities, execute and deliver an indenture supplemental hereto, which shall provide for the appointment of such Trustee as Trustee for the Securities of such series and shall add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees to be co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee.

No trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder.

SECTION 610. Resignation and Removal; Appointment of Successor .

(a) No resignation or removal of the Trustee for the Securities of any series and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 611.

(b) The Trustee for the Securities of any series may resign at any time with respect to the Securities of such series by giving written notice thereof to the Company. If the instrument of acceptance by a successor Trustee required by Section 611 shall not have been delivered to the Trustee for the Securities of such series within 30 days after the giving of such notice of resignation, the resigning Trustee may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(c) The Trustee for the Securities of any series may be removed at any time with respect to the Securities of such series by Act of the Holders of a majority in aggregate principal amount of the Outstanding Securities of such series, delivered to such Trustee and to the Company.

(d) If at any time:

(1) the Trustee for the Securities of any series shall fail to comply with Section 608 after written request thereof by the Company or by any Holder who has been a bona fide Holder of a Security of such series for at least six months; or

(2) such Trustee shall cease to be eligible under Section 609 and shall fail to resign after written request therefor by the Company or by any such Holder; or

(3) such Trustee shall become incapable of acting or shall be adjudged bankrupt or insolvent or a receiver of such Trustee or of its property shall be appointed or any public officer shall take charge or control of such Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation;

then, in any such case, (i) the Company by a Board Resolution may remove such Trustee and appoint a successor Trustee, or (ii) subject to Section 514, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of such Trustee and the appointment of a successor Trustee or Trustees. If the instrument of acceptance by a successor Trustee required by Section 611 shall not have been delivered to the Trustee for the Securities of such series within 30 days after the giving of such notice of removal, the Trustee being removed may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series

(e) If the Trustee for the Securities of any series shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for the Securities of any series for any cause, the Company, by a Board Resolution, shall promptly appoint a successor Trustee with respect to the Securities of such series and shall comply with the applicable requirements of Section 611. If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of such series shall not have been appointed by the Company pursuant to this Section 610, then a successor Trustee may be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee. If no successor Trustee for the Securities of such series shall have been so appointed by the Company or the Holders and shall have accepted appointment in the manner required by Section 611, and if such Trustee to be replaced is still incapable of acting, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(f) The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series by mailing written notice of such event by first-class mail, postage prepaid, to all Holders of Securities of such series as their names and addresses appear in the Security Register. Each notice shall include the name of the successor Trustee with respect to the Securities of that series and the address of its Corporate Trust Office.

SECTION 611. Acceptance of Appointment by Successor .

(a) Every such successor Trustee appointed hereunder with respect to the Securities of any series shall execute, acknowledge and deliver to the Company, the Guarantor and the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company, the Guarantor or the successor Trustee, such retiring Trustee shall, upon receipt of payment of its charges, execute, and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.

(b) In case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the Guarantor, the retiring Trustee and each successor Trustee with respect to the Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of the Company, the Guarantor or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of such successor Trustee relates.

(c) Upon request of any such successor Trustee, the Company and the Guarantor shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers, and trusts referred to in paragraph (a) or (b) of this Section, as the case may be.

(d) No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee for the Securities of any series shall be qualified and eligible under this Article.

SECTION 612. Merger, Conversion, Consolidation or Succession to Business .

Any corporation into which the Trustee for the Securities of any series may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of such Trustee, shall be the successor of such Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Securities shall have been authenticated, but not delivered, by the Trustee or the Authenticating Agent for such series then in office, any successor by merger, conversion or consolidation to such authenticating Trustee or Authenticating Agent, as the case may be, may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee or successor Authenticating Agent had itself authenticated such Securities.

SECTION 613. Preferential Collection of Claims Against the Company or the Guarantor .

If and when the Trustee of any series of Securities shall be or become a creditor of the Company or the Guarantor (or any other obligor upon the Securities), such Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any such other obligor).

SECTION 614. Authenticating Agents .

From time to time the Trustee of any series of Securities, in its sole discretion, may appoint one or more Authenticating Agents with respect to the Securities of such series, which may include the Company, the Guarantor or any Affiliate of the Company or the Guarantor, with power to act on the Trustee’s behalf and subject to its discretion in the authentication and delivery of Securities of such series or in connection with transfers and exchanges under Sections 304, 305, 306 and 1107 as fully to all intents and purposes as though such Authenticating Agent had been expressly authorized by those Sections of this Indenture to authenticate and deliver Securities of such series. For all purposes of this Indenture, the authentication and delivery of Securities of such series by an Authenticating Agent for such Securities pursuant to this Section shall be deemed to be authentication and delivery of such Securities “by the Trustee” for the Securities of such series. Any such Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United

States, any State thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $25,000,000 and, if other than the Company, the Guarantor or any Affiliate of the Company or the Guarantor, subject to supervision or examination by federal, state or District of Columbia authority. If such corporation publishes reports of condition at least annually pursuant to law or the requirements of such authority, then for the purposes of this Section the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent for any series of Securities shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.

Any corporation into which any Authenticating Agent may be merged or with which it may be consolidated, or any corporation resulting from any merger or consolidation or to which any Authenticating Agent shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of any Authenticating Agent, shall be the successor of such Authenticating Agent hereunder, if such successor corporation is otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the parties hereto or the Authenticating Agent or such successor corporation.

Any Authenticating Agent for any series of Securities may resign at any time by giving written notice of resignation to the Trustee for such series and to the Company. The Trustee for any series of Securities may at any time terminate the agency of any Authenticating Agent for such series by giving written notice of termination to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time any Authenticating Agent for any series of Securities shall cease to be eligible under this Section, the Trustee for such series may appoint a successor Authenticating Agent, which shall be acceptable to the Company, shall give written notice of such appointment to the Company and shall give written notice of such appointment to all Holders of Securities of such series with respect to which such Authenticating Agent will serve, as the names and addresses of such Holders appear on the Security Register. Any successor Authenticating Agent, upon acceptance of its appointment hereunder, shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

The Trustee for any series of Securities agrees to pay to the Authenticating Agent for such series from time to time reasonable compensation for its services, and such Trustee shall be entitled to be reimbursed for such payments, subject to Section 607.

If an appointment with respect to one or more series of Securities is made pursuant to this Section, the Securities of such series may have endorsed thereon, in addition to the Trustee’s certificate of authentication, an alternate certificate of authentication in the following form:

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.


WELLS FARGO BANK, N.A., as Trustee

By

As Authenticating Agent

By
		Authorized Signatory

The provisions of Sections 309, 604 and 605 shall be applicable to any Authenticating Agent.

ARTICLE SEVEN

- HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY

SECTION 701. Company to Furnish Trustee Names and Addresses of Holders .

With respect to each particular series of Securities, the Company will furnish or cause to be furnished to the Trustee for the Securities of such series:

(a) semi-annually, not later than 15 days after each Regular Record Date, or, in the case of any series of Securities on which semi-annual interest is not payable, not more than 15 days after such semi-annual dates as may be specified by such Trustee, a list, in such form as such Trustee may reasonably require, of the names and addresses of the Holders as of such Regular Record Date or semi-annual date, as the case may be; and

(b) at such other times as such Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as specified in Clause (a) above as of a date not more than 15 days prior to the time such list is furnished;

provided, however, that so long as such Trustee is Security Registrar for any series of Securities, no such list shall be required to be furnished with respect to any such series.

SECTION 702. Preservation of Information; Communications to Holders .

(a) The Trustee for each series of Securities shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to such Trustee as provided in Section 701 and the names and addresses of Holders received by such Trustee in its capacity as Security Registrar. Such Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished.

(b) If three or more Holders of any particular series (herein referred to as “applicants”) apply in writing to the Trustee for the Securities of such series, and furnish to such Trustee reasonable proof that each such applicant has owned a Security for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other Holders of Securities of such series with respect to their rights under this Indenture or under the Securities and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then such Trustee shall, within five business days after the receipt of such application, at its election, either:

(i) afford such applicants access to the information preserved at the time by such Trustee in accordance with Section 702(a); or

(ii) inform such applicants as to the approximate number of Holders of Securities of such series whose names and addresses appear in the information preserved at the time by such Trustee in accordance with Section 702(a), and as to the approximate cost of mailing to such Holders the form of proxy or other communication, if any, specified in such application.

If any such Trustee shall elect not to afford such applicants access to such information, such Trustee shall, upon the written request of such applicants, mail to each Holder of Securities of such series whose name and address appear in the information preserved at the time by such Trustee in accordance with Section 702(a) a copy of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to such Trustee of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless within five days after such tender such Trustee shall mail to such applicants and file with the Commission, together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of such Trustee, such mailing would be contrary to the best interest of the Holders or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, the Commission shall find, after notice and opportunity for hearing, that all the objections so sustained have been met and shall enter an order so declaring, such Trustee shall mail copies of such material to all such Holders with reasonable promptness after the entry of such order and the renewal of such tender, otherwise such Trustee shall be relieved of any obligation or duty to such applicants respecting their application.

(c) Every Holder of Securities of each series, by receiving and holding the same, agrees with the Company, the Guarantor and the Trustee for the Securities of such series that none of the Company, the Guarantor and such Trustee nor any agent of any of them shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders in accordance with Section 702(b), regardless of the source from which such information was derived, and that such Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under Section 702(b).

(d) The U.S. Depositary may grant proxies and otherwise authorize its participants which own the Global Securities to give or take any Act which a Holder is entitled to take under the Indenture; provided , however , that the U.S. Depositary has delivered a list of such participants to the Trustee for the Securities of such series.

SECTION 703. Reports by Trustee .

(a) The Trustee for the Securities of each series shall transmit to Holders of Securities of each series for which such Trustee serves such reports concerning such Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the Trustee for the Securities of each series shall, within sixty days after each May 15 following the date of this Indenture deliver to Holders of Securities of each series for which such Trustee serves a brief report, dated as of such May 15, which complies with the provisions of such Section 313(a).

(b) A copy of each such report shall, at the time of such transmission to Holders of Securities of each particular series be filed by each particular Trustee with each stock exchange upon which any Securities are listed, with the Commission and with the Company. The Company will promptly notify the Trustee in writing when any Securities are listed on any stock exchange or of any delisting thereof.

SECTION 704. Reports by Company .

(a) The Company shall:

(1) file with the Trustee for the Securities of each series, within 15 days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or if the Company is not required to file information, documents or reports pursuant to either of said Sections, then it shall file with such Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act, in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations;

(2) file with the Trustee for the Securities of such series and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and

(3) transmit by mail to all Holders, as their names and addresses appear in the Security Register, within 30 days after the filing thereof with the Trustee for the Securities of such series, such summaries of any information, documents and reports required to be filed by the Company pursuant to paragraphs (1) and (2) of this Clause (a) as may be required by rules and regulations prescribed from time to time by the Commission.

(b) the Guarantor shall:

(1) file with the Trustee for the Securities of each series, within 15 days after the Guarantor is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Guarantor may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or if the Guarantor is not required to file information, documents or reports pursuant to either of said Sections, then it shall file with such Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act, in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations;

(2) file with the Trustee for the Securities of such series and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Guarantor with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and

(3) transmit by mail to all Holders, as their names and addresses appear in the Security Register, within 30 days after the filing thereof with the Trustee for the Securities of such series, such summaries of any information, documents and reports required to be filed by the Guarantor pursuant to paragraphs (1) and (2) of this Clause (b) as may be required by rules and regulations prescribed from time to time by the Commission.

Delivery of such reports, information and documents to the Trustee for the Securities of each series is for informational purposes only and such Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which such Trustee is entitled to rely exclusively on Officer’s Certificates).

ARTICLE EIGHT

- CONSOLIDATION, MERGER, CONVEYANCE, SALE OR LEASE

SECTION 801. Company and Guarantor May Consolidate, Etc., on Certain Terms .

(a) The Company shall not consolidate, amalgamate or merge with or into any other corporation or corporations (whether or not affiliated with the Company) and the Company or its successor or successors shall not be a party or parties to successive consolidations, amalgamations or mergers and the Company shall not sell, convey or lease all or substantially all of its property to any other corporation (whether or not affiliated with the Company) authorized to acquire and operate the same, unless (i) upon any such consolidation, amalgamation, merger, sale, conveyance or lease, the due and punctual payment of the principal of (and premium, if any, on) and interest, if any, on all of the Securities, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed by the Company shall be expressly assumed, by supplemental indenture reasonably satisfactory in form to the Trustee for each series of Securities, executed and delivered to each such Trustee by the corporation (if other than the Company) formed by such consolidation or amalgamation, or into which the Company shall have been merged, or by the corporation which shall have acquired or leased such property, and (ii) such corporation or company shall be a solvent corporation or company organized under the laws of the United States of America or a State thereof or the District of Columbia or Bermuda or of a Member State of the European Union. The Company will not so consolidate, amalgamate or merge, or make any such sale, lease or other disposition, and the Company will not permit any other corporation to merge into the Company, unless immediately after the proposed consolidation, amalgamation, merger, sale, lease or other disposition, and after giving effect thereto, no default in the performance or observance by the Company or such successor corporation, as the case may be, of any of the terms, covenants, agreements or conditions contained in this Indenture shall have occurred and be continuing.

(b) The Guarantor shall not consolidate, amalgamate or merge with or into any other corporation or corporations (whether or not affiliated with the Guarantor) and the Guarantor or its successor or successors shall not be a party or parties to successive consolidations, amalgamations or mergers and the Guarantor shall not sell, convey or lease all or substantially all of the property of the Guarantor to any other corporation (whether or not affiliated with the Guarantor) authorized to acquire and operate the same, unless (i) upon any such consolidation, amalgamation, merger, sale, conveyance or lease, the performance of the obligations under the Guarantee, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed by the Guarantor shall be expressly assumed, by supplemental indenture reasonably satisfactory in form to the Trustee for each series of Securities, executed and delivered to each such Trustee by the corporation (if other than the Guarantor) formed by such consolidation or amalgamation, or into which the Guarantor shall have been merged, or by the corporation which shall have acquired or leased such property, and (ii) such corporation shall be a solvent corporation or company organized under the laws of the United States of America or a State thereof or the District of Columbia or Bermuda or of a Member State of the European Union. Furthermore, the Guarantor will not so consolidate, amalgamate or merge, or make any such sale, lease or other disposition, and the Guarantor will not permit any other corporation to merge into it, unless immediately after the proposed consolidation, amalgamation, merger, sale, lease or other disposition, and after giving effect thereto, no default in the performance or observance by the Guarantor or such successor corporation, as the case may be, of any of the terms, covenants, agreements or conditions contained in this Indenture or the Guarantee shall have occurred and be continuing.

SECTION 802. Securities to be Secured in Certain Events .

Notwithstanding anything to the contrary contained in Section 801, if upon any such consolidation, amalgamation or merger, or upon any such sale, conveyance or lease, or upon any consolidation, amalgamation or merger of any Restricted Subsidiary, or upon the sale, conveyance or lease of all or substantially all the property of any Restricted Subsidiary to any other corporation, any Principal Property or any shares of stock or Funded Indebtedness of any Restricted Subsidiary owned immediately prior thereto would thereupon become subject to any Mortgage, the Company, together with the Guarantor, prior to such consolidation, amalgamation, merger, sale, conveyance or lease, will by indenture supplemental hereto secure the due and punctual payment of the principal of (and premium, if any, on) and interest, if any, on the Securities (together with, if the Guarantor shall so determine, any other indebtedness of or guarantee by the Guarantor, the Company or such other Restricted Subsidiary ranking equally with the Securities and then existing or thereafter created) by a Mortgage, the lien of which, upon completion of said merger, consolidation, amalgamation, sale, conveyance or lease, will rank prior to the lien of such Mortgage of such other corporation on all assets owned by the Guarantor, the Company or (if other than the Company) such other Restricted Subsidiary, as the case may be, immediately prior to such merger, consolidation, amalgamation, sale, conveyance or lease.

SECTION 803. Successor Corporation to be Substituted .

(a) Upon any consolidation, amalgamation or merger of the Company with or into any other corporation or corporations or any sale, conveyance or lease of all or substantially all of the property of the Company to any other corporation or corporations in accordance with this Article Eight, the successor shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture and the Securities with the same effect as if such successor had been named as the Company herein and therein, and thereafter, except in the case of a lease, the Company as the predecessor corporation shall be relieved of all obligations and covenants under this Indenture and the Securities and the Company as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated.

(b) Subject to Section 801(b), upon any consolidation, amalgamation or merger of the Guarantor with or into any other corporation or corporations or any sale, conveyance or lease of all or substantially all of the property of the Guarantor to any other corporation or corporations in accordance with this Article Eight, the successor shall succeed to, and be substituted for, and may exercise every right and power of, the Guarantor under this Indenture, the Securities and the Guarantee with the same effect as if such successor had been named as the Guarantor herein and therein, and thereafter, except in the case of a lease, the Guarantor as predecessor corporation shall be relieved of all obligations and covenants under this Indenture and the Guarantee, and the Guarantor as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated.

SECTION 804. Opinion of Counsel to be Given to Trustee .

The Trustee for each series of Securities, subject to Section 601, shall receive an Opinion of Counsel as conclusive evidence that any such consolidation, amalgamation, merger, sale, conveyance or lease and any such assumption complies with the provisions of this Article.

ARTICLE NINE

- SUPPLEMENTAL INDENTURES

SECTION 901. Supplemental Indentures without Consent of Holders.

Without the consent of any Holders, the Company, the Guarantor and the Trustee for the Securities of any or all series, at any time and from time to time, may enter into one or more indentures supplemental hereto, for any of the purposes set forth below in this Section 901. The terms of such supplemental indenture may be established by one or more duly appointed officers of the Company and one or more duly appointed officers of the Guarantor acting pursuant to authority granted to such officers by the Board of Directors of the Company and by the Board of Directors of the Guarantor. A supplemental indenture, in form reasonably satisfactory to the Trustee, may be entered into pursuant to this Section 901 for any of the following purposes:

(1) to evidence the succession of another corporation to the Company or the Guarantor and the assumption by any such successor of the covenants of the Company herein and in the Securities or the assumption by any such successor of the covenants of the Guarantor herein and in the Guarantee; or

(2) to add to the covenants of the Company or the Guarantor for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company or the Guarantor, as applicable; or

(3) to add any additional Events of Default; or

(4) to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons; or

(5) to change or eliminate any of the provisions of this Indenture; provided , that any such change or elimination shall become effective only when there is no Security Outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such provisions; or

(6) to secure the Securities; or

(7) to establish the form or terms of Securities of any series as permitted by Sections 201 and 301; or

(8) to establish the form or terms of a related Guarantee as permitted by Sections 201 and 206; or

(9) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 611(b); or

(10) to evidence and provide for the acceptance of appointment hereunder of a Trustee other than Wells Fargo Bank, N.A. as Trustee for a series of Securities and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 609; or

(11) to provide for any rights of the Holders of Securities of any series to require the repurchase of Securities of such series from the Company; or

(12) to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture; provided such action shall not adversely affect the interests of the Holders of Securities of any series in any material respect; or

(13) to continue its qualification under the Trust Indenture Act or as may be necessary or desirable in accordance with amendments to the Trust Indenture Act; or

(14) for any other reason specified pursuant to Section 301 with respect to the Securities of such series.

SECTION 902. Supplemental Indentures with Consent of Holders.

With the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of any or all series affected by such supplemental indenture (voting as one class), by Act of said Holders delivered to the Company, the Guarantor and the Trustee of each such series of Securities, the Company, when authorized by or pursuant to a Board Resolution of its Board of Directors, the Guarantor, when authorized by or pursuant to a Board Resolution by the Guarantor’s Board of Directors, and each such Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Security affected thereby:

(1) change the Stated Maturity of the principal of, or any installment of principal of or interest, if any, on, any Security, or reduce the principal amount

thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502, or change any Place of Payment where, or the coin or currency in which, any Security or any premium or the interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date), or release the Guarantor from any of its obligations under the Guarantee or modify such obligations otherwise than in accordance with the terms of this Indenture;

(2) reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture; or

(3) modify any of the provisions of this Section, Section 513 or Section 1008, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Security affected thereby; provided , however, that this Clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes in this Section and Section 1008, or the deletion of this proviso, in accordance with the requirements of Sections 609, 611(b), 901(9) and 901(10).

A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series.

It shall not be necessary for any Act of Holders of any series of Securities under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.

SECTION 903. Execution of Supplemental Indentures.

In executing, or accepting the additional trusts created by, and supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee for any series of Securities shall receive, and (subject to Section 601) shall be fully protected in conclusively relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee for any series of Securities may, but shall not be obligated to, enter into any such supplemental indenture which affects such Trustee’s own rights, duties or immunities under this Indenture or otherwise.

SECTION 904. Effect of Supplemental Indentures.

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes, and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

SECTION 905. Conformity with Trust Indenture Act.

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect.

SECTION 906. Reference in Securities to Supplemental Indentures.

Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee for the Securities of such series, bear a notation in form approved by such Trustee as to any matter provided for in such supplemental indenture. If the Company or the Guarantor shall so determine, new forms of the Securities of any series and the Guarantee endorsed thereon modified as to conform, in the opinion of the Trustee for the Securities of such series, the Company and the Guarantor, to any supplemental indenture may be prepared and executed by the Company and authenticated and delivered by such Trustee in exchange for Outstanding Securities of such series.

ARTICLE TEN

- COVENANTS

SECTION 1001. Payment of Principal, Premium and Interest.

The Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay the principal of (and premium, if any, on) and interest, if any, on the Securities of that series in accordance with the terms of the Securities and this Indenture.

SECTION 1002. Maintenance of Office or Agency.

The Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. The Guarantor will maintain an office or agency in each Place of Payment for any series of Securities where notices and demands to or upon the Guarantor in respect of the Securities of that series and this Indenture may be served. The Company and the Guarantor will give prompt written notice to the Trustee for Securities of that series of the location, and any change in the location, of such office or agency. If at any time the Company or the Guarantor shall fail to maintain any such required office or agency or shall fail to furnish the Trustee for the Securities of that series with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of such Trustee, and the Company and the Guarantor hereby appoint such Trustee as its agent to receive all such presentations, surrenders, notices and demands.

The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee for the Securities of each series of any such designation or rescission and of any change in the location of any such other office or agency.

SECTION 1003. Money for Securities Payments to Be Held in Trust.

If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date of the principal of (and premium, if any, on) or interest, if any, on any of the Securities of that series, segregate and hold in trust for the benefit of the persons entitled thereto a sum sufficient to pay the principal (and premium, if any, on) or interest, if any, so becoming due until such sums shall be paid to such persons or otherwise disposed of as herein provided and will promptly notify the Trustee for the Securities of such series of its action or failure so to act.

Whenever the Company shall have one or more Paying Agents for any series of Securities, it will, prior to each due date of the principal of (and premium, if any, on) or interest, if any, on any Securities of that series, deposit with a Paying Agent a sum sufficient to pay the principal (and premium, if any, on) or interest so becoming due, such sum to be held in trust for the benefit of the persons entitled to such principal, premium or interest, and (unless such Paying Agent is the Trustee for the Securities of such series) the Company will promptly notify such Trustee of its action or failure so to act.

The Company will cause each Paying Agent for any series of Securities other than the Trustee for the Securities of such series to execute and deliver to such Trustee an instrument in which such Paying Agent shall agree with such Trustee, subject to the provisions of this Section, that such Paying Agent will:

(1) hold all sums held by it for the payment of the principal of (and premium, if any, on) or interest, if any, on Securities of that series in trust for the benefit of the persons entitled thereto until such sums shall be paid to such persons or otherwise disposed of as herein provided;

(2) give such Trustee notice of any default by the Company (or any other obligor upon the Securities of that series) in the making of any payment of principal of (and premium, if any, on) or interest, if any, on the Securities of that series; and

(3) at any time during the continuance of any such default, upon the written request of such Trustee, forthwith pay to such Trustee all sums so held in trust by such Paying Agent.

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee for the Securities of any series all sums held in trust by the Company or such Paying Agent, such sums to be held by such Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to such Trustee, such Paying Agent shall be released from all further liability with respect to such money.

Any money deposited with the Trustee or any Paying Agent for the Securities of any series, or then held by the Company or the Guarantor, in trust for the payment of the principal of (and premium, if any, on) or interest, if any, on any Security of any series and remaining unclaimed for two years after such principal (and premium, if any) or interest has become due and payable shall be paid to the Company or the Guarantor on Company Request, or, if then held by the Company or the Guarantor, shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company or the Guarantor, as the case may be, for payment thereof, and all liability of such Trustee or such Paying Agent with respect to such trust money, and all liability of the Company or the Guarantor, as the case may be, as trustee thereof, shall thereupon cease; provided, however, that such Trustee or such Paying Agent, before being required to make any such repayment, shall at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in the City, County and State of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company or the Guarantor, as the case may be.

SECTION 1004. Limitation on Liens.

(a) The Guarantor covenants and agrees for the benefit of each series of Securities, other than any series established by or pursuant to a Board Resolution of the Guarantor or in one or more supplemental indentures hereto which specifically provides otherwise, that it will not, and will not permit any Restricted Subsidiary to, create, assume or guarantee any indebtedness for money borrowed secured by a Mortgage (i) on any Principal Property of the Guarantor or of a Restricted Subsidiary or (ii) on any shares or Funded Indebtedness of a Restricted Subsidiary (whether such Principal Property, shares or Funded Indebtedness are now owned or hereafter acquired) without, in any such case, effectively providing concurrently with the creation, assumption or guaranteeing of such indebtedness that the Securities (together, if the Guarantor shall so determine, with any other indebtedness then or thereafter existing, created, assumed or guaranteed by the Guarantor or such Restricted Subsidiary ranking equally with the Securities) shall be secured equally and ratably with (or prior to) such indebtedness; excluding, however, from the foregoing any indebtedness secured by a Mortgage (including any extension, renewal or replacement, or successive extensions, renewals or replacements, of any Mortgage hereinafter specified or any indebtedness secured thereby, without increase of the principal of such indebtedness or expansion of the collateral securing such indebtedness):

(1) on property, shares or Funded Indebtedness of any corporation existing at the time such corporation becomes a Restricted Subsidiary; or

(2) on property existing at the time of acquisition thereof by the Guarantor or a Restricted Subsidiary, or to secure any indebtedness incurred for the purpose of financing all or any part of the purchase price thereof or construction or improvements thereon, which indebtedness is incurred by the Guarantor or a Restricted Subsidiary prior to, at the time of or within 180 days after the later of the acquisition, the completion of construction (including any improvements on an existing property) and the commencement of commercial operation of such property; provided, however, that in the case of any such acquisition, construction or improvement the Mortgage shall not apply to any property theretofore owned by the Guarantor or a Restricted Subsidiary, other than, in the case of any such construction or improvement, any theretofore unimproved real property on which the property so constructed, or the improvement, is located; or

(3) on property, shares or Funded Indebtedness of a corporation existing at the time such corporation is merged into or consolidated with the Guarantor or a Restricted Subsidiary, or at the time of a sale, lease or other disposition of the properties of a corporation as an entirety or substantially as an entirety to the Guarantor or a Restricted Subsidiary; or

(4) on property of a Restricted Subsidiary to secure indebtedness of such Restricted Subsidiary to the Guarantor or another Restricted Subsidiary; or

(5) on property of the Guarantor or a Restricted Subsidiary in favor of the United States of America or any State thereof or Bermuda, or any department, agency or instrumentality or political subdivision of the United States of America or any State thereof or Bermuda, to secure partial, progress, advance or other payments pursuant to any contract or statute or to secure any indebtedness incurred for the purpose of financing all or any part of the purchase price or the cost of constructing or improving the property subject to such Mortgage; or

(6) existing at the date of this Indenture;

provided, however, that any Mortgage permitted by any of the foregoing Clauses (1), (2), (3) and (5) of this Section 1004(a) shall not extend to or cover any property of the Guarantor or such Restricted Subsidiary, as the case may be, other than the property specified in such Clauses and improvements thereto.

(b) Notwithstanding the provisions of Subsection (a) of this Section 1004, the Guarantor or any Restricted Subsidiary may create, assume or guarantee secured indebtedness for money borrowed which would otherwise be prohibited in said Subsection (a) in an aggregate amount which, together with all other such indebtedness for money borrowed of the Guarantor and its Restricted Subsidiaries and the Attributable Debt of the Guarantor and its Restricted Subsidiaries in respect of Sale and Leaseback

Transactions (as defined in Section 1005) existing at such time (other than Sale and Leaseback Transactions entered into prior to the date of this Indenture and Sale and Leaseback Transactions the proceeds of which have been applied in accordance with Clause (b) of Section 1005), does not at the time exceed 10% of the shareholders’ equity in the Guarantor and its consolidated Subsidiaries, as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of the Guarantor.

(1) the term “Attributable Debt” shall mean, as of any particular time, the then present value of the total net amount of rent required to be paid under such lease during the remaining term thereof (excluding any renewal term unless the renewal is at the option of the lessor) computed by discounting from the respective due dates to such date such total net amount of rent at the actual interest factor included in such rent, or, if such interest factor cannot readily be determined, at the rate per annum borne by the initial series of Securities, except that if no interest is payable in respect of the initial series of Securities or if such rate is not fixed then at the rate of 8 ³ / 8 % per annum. The net amount of rent required to be paid for any such period shall be the aggregate amount of the rent payable by the lessee with respect to such period after excluding amounts required to be paid on account of, or measured or determined by, any variable factor, including, without limitation, the cost-of-living index and costs of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges and after excluding any portion of rentals based on a percentage of sales made by the lessee. In the case of any lease which is terminable by the lessee upon the payment of a penalty, such net amount shall also include the amount of such penalty, but no rent shall be considered as required to be paid under such lease subsequent to the first date upon which it may be so terminated;

(2) the term “shareholders’ equity in the Guarantor and its consolidated Subsidiaries” shall mean the share capital, share premium, contributed surplus and retained earnings of the Guarantor and its consolidated Subsidiaries, excluding the cost of shares of the Guarantor held by its Affiliates, all as determined in accordance with U.S. generally accepted accounting principles; and

(3) the term “Mortgage” on any specified property shall mean any mortgage, lien, pledge, charge or other security interest or encumbrance of any kind in respect of such property.

SECTION 1005. Limitation on Sale and Leaseback Transactions.

The Guarantor covenants and agrees for the benefit of each series of Securities, other than any series established by or pursuant to a Board Resolution of the Guarantor or in one or more supplemental indentures hereto which specifically provides otherwise, that it will not, and will not permit any Restricted Subsidiary to, enter into any arrangement with any person for the leasing by the Guarantor or a Restricted Subsidiary (except for leases for a term of not more than

three years and for leases of a part of a Principal Property which has been sold, for use in connection with the winding up or termination of the business conducted on such Principal Property, and except, in the case of a Restricted Subsidiary, a lease to the Guarantor or another Restricted Subsidiary) of any Principal Property (whether now owned or hereafter acquired), which Principal Property has been or is intended to be sold or transferred by the Guarantor or such Restricted Subsidiary to such person (herein referred to as a “Sale and Leaseback Transaction”), unless (a) the Guarantor or such Restricted Subsidiary would be entitled, pursuant to the provisions of Section 1004, to incur indebtedness secured by a Mortgage on such Principal Property without equally and ratably securing the Securities, or (b) the Guarantor shall (and in any such case the Guarantor covenants that it will) apply within 180 days of the effective date of any such Sale and Leaseback Transaction an amount equal to the fair value (as determined by its Board of Directors) of such Principal Property so leased (i) to the retirement (other than by payment at maturity or to satisfy the mandatory requirements of any sinking, purchase or analogous fund or prepayment provision) of the Securities or other Funded Indebtedness of the Guarantor or any Restricted Subsidiary ranking on a parity with the Securities, provided , however , that the amount to be applied to the retirement of any Funded Indebtedness as provided under this Clause (i) shall be reduced by (x) the principal amount of any Securities delivered within 180 days after such sale or transfer to the Trustee for the Securities of such series for retirement and cancellation and (y) the principal amount of other Funded Indebtedness ranking on a parity with the Securities voluntarily retired by the Guarantor within 180 days after such sale or transfer; or (ii) to the purchase, improvement or construction of properties which are Principal Properties, provided , that if only a portion of such proceeds is designated as a credit against such purchase, improvement or construction, the Guarantor shall apply an amount equal to the remainder as provided in Clause (i); and promptly after the expiration of such 180-day period the Guarantor shall have delivered to the Trustee for the Securities of such series an Officer’s Certificate setting forth in reasonable detail all material facts necessary to show compliance with this Subsection.

SECTION 1006. Defeasance of Certain Obligations.

Each of the Company and the Guarantor may omit to comply with, and shall have no liability in respect of, any term, provision or condition set forth in Sections 802, 1004 and 1005 (and each of the Company and the Guarantor may omit to comply with, and shall have no liability in respect of any other provision or condition specified pursuant to Section 301(14) for such Securities) with respect to the Securities of any series whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant, to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default under Section 501(4) or otherwise, as the case may be; provided that the following conditions shall have been satisfied:

(1) Either the Company or the Guarantor has deposited or caused to be irrevocably deposited (except as provided in Section 402(c) and the last paragraph of Section 1003) with the Trustee for the Securities of such series (specifying that each deposit is pursuant to this Section 1006) as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities of such series, (i) money in an amount, or (ii) (except as provided in a supplemental indenture with respect to such series) if Securities of such series are

not subject to repurchase at the option of such Holders, (A) U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide not later than one day before the due date of any payment referred to in Clause (x) or (y) of this subparagraph (1) money in an amount, or (B) a combination of the foregoing, sufficient, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to such Trustee, to pay and discharge (x) the principal of (and premium, if any, on) and each installment of principal of (and premium, if any, on) and interest, if any, on the Outstanding Securities of such series on the Stated Maturity of such principal or installment of principal or interest or to and including the Redemption Date irrevocably designated by the Company or the Guarantor, as the case may be, pursuant to subparagraph (4) of this Section and (y) any mandatory sinking fund payments applicable to the Securities of such series on the day on which such payments are due and payable in accordance with the terms of the Indenture and of the Securities of such series;

(2) No Event of Default or event which, with notice or lapse of time or both, would become an Event of Default (including by reason of such deposit) with respect to the Securities of such series shall have occurred and be continuing on the date of such deposit;

(3) The Company or the Guarantor, as the case may be, shall have delivered to such Trustee an Opinion of Counsel to the effect that Holders of the Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and defeasance of certain obligations and that no Event of Default or default shall have occurred and be continuing; and

(4) If the Company or the Guarantor has deposited or caused to be deposited money or U.S. Government Obligations or a combination thereof to pay or discharge the principal of (and premium, if any, on) and interest, if any, on the Outstanding Securities of a series to and including a Redemption Date on which all of the Outstanding Securities of such series are to be redeemed, such Redemption Date shall be irrevocably designated by a Board Resolution of the Company or the Guarantor, as the case may be, or delivered to such Trustee on or prior to the date of deposit of such money or U.S. Government Obligations, and such Board Resolution shall be accompanied by an irrevocable Company Request that such Trustee give notice of such redemption in the name and at the expense of the Company or the Guarantor, as the case may be, and not less than 30 nor more than 60 days prior to such Redemption Date in accordance with Section 1104.

SECTION 1007. Statement by Officer as to Default.

Each of the Company and the Guarantor will deliver to the Trustee for each series of Securities, on or before May 15 in each year ending after the date hereof, an Officer’s Certificate

(one of the signatories of which shall be the principal executive officer, principal accounting officer or principal financial officer of the Company) stating that in the course of the performance by such signer of his or her duties as an officer of the Company or the Guarantor, as the case may be, he would normally have knowledge of any default (without regard to periods of grace or notice requirements) by the Company or the Guarantor in the performance and observance of any of the covenants contained in this Indenture, and stating whether or not he has knowledge of any such default and, if so, specifying each such default of which such signer has knowledge and the nature thereof.

The Company and the Guarantor each covenant to deliver to the Trustee, for each series of Securities, as soon as possible and in any event within five Business Days after the Company or the Guarantor, as the case may be, becomes aware of the occurrence of any Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default, an Officer’s Certificate setting forth the details of such Event of Default or default and the action which the Company or the Guarantor, as the case may be, proposes to take with respect thereto.

SECTION 1008. Waiver of Certain Covenants.

Each of the Company and the Guarantor may omit in any particular instance to comply with any term, provision or condition set forth in Sections 802, 1004 and 1005 (and each of the Company and the Guarantor may omit in any particular instance to comply with any term, provision or condition specified pursuant to Section 301(14) for such Securities) if before the time for such compliance the Holders of at least a majority in principal amount of the Outstanding Securities of all series affected by such omission (voting as one class) shall, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the Guarantor, as the case may be, and the duties of the Trustee for the Securities of each series in respect of any such term, provision or condition shall remain in full force and effect.

SECTION 1009. Calculation of Original Issue Discount .

The Company shall file with the Trustee for the Securities of each series promptly at the end of each calendar year (i) a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on the Outstanding Securities as of the end of such year and (ii) such other specific information relating to such original issue discount as may then be relevant under the Internal Revenue Code of 1986, as amended from time to time.

ARTICLE ELEVEN

- REDEMPTION OF SECURITIES

SECTION 1101. Applicability of Article .

Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 301 for Securities of any series) in accordance with this Article.

SECTION 1102. Election to Redeem; Notice to Trustee.

The election of the Company to redeem any Securities of any series shall be evidenced by an Officer’s Certificate. In case of any redemption at the election of the Company of the Securities of any series, the Company shall, at least 60 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be reasonably satisfactory to the Trustee for the Securities of such series), notify such Trustee of such Redemption Date and of the principal amount of Securities of such series to be redeemed, such notice to be accompanied by a written statement signed by an authorized officer of the Company stating that no defaults in the payment of interest or Events of Default with respect to the Securities of that series have occurred (which have not been waived or cured). In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee for the Securities of such series with an Officer’s Certificate evidencing compliance with such restriction.

SECTION 1103. Selection by Trustee of Securities to Be Redeemed.

If less than all the Securities of any series are to be redeemed, the particular Securities of that series to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee for the Securities of such series, from the Outstanding Securities of such series not previously called for redemption, by such method as such Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series.

Securities shall be excluded from eligibility for selection for redemption if they are identified by registration and certificate number in a written statement signed by an authorized officer of the Company and delivered to the Trustee for the Securities of such series at least 60 days prior to the Redemption Date as being owned of record and beneficially by, and not pledged or hypothecated by either (a) the Company or the Guarantor or (b) an entity specifically identified in such written statement which is an Affiliate of the Company or the Guarantor.

The Trustee for the Securities of such series shall promptly notify the Company and the Guarantor in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed.

SECTION 1104. Notice of Redemption.

Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed, at his or her address appearing in the Security Register.

All notices of redemption shall identify the Securities (including CUSIP numbers) to be redeemed and shall state:

(1) the Redemption Date;

(2) the Redemption Price;

(3) if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption, the principal amounts) of the particular Securities to be redeemed;

(4) that on the Redemption Date the Redemption Price will become due and payable upon each such Security to be redeemed and, if applicable, that interest thereon will cease to accrue on and after said date;

(5) the place or places where such Securities are to be surrendered for payment of the Redemption Price; and

(6) that the redemption is for a sinking fund, if such is the case.

Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company’s written request and expense, by the Trustee for such Securities in the name and at the expense of the Company.

SECTION 1105. Deposit of Redemption Price.

At least one Business Day prior to any Redemption Date, the Company or the Guarantor shall deposit with the Trustee for the Securities to be redeemed or with a Paying Agent (or, if the Company or the Guarantor is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date (to the extent that such amounts are not already on deposit at such time in accordance with the provisions of Section 401, 403 or 1006).

SECTION 1106. Securities Payable on Redemption Date.

Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued and unpaid interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the Redemption Price, together with accrued and unpaid interest to the Redemption Date; provided, however, that installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307.

If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest from the Redemption Date at the rate prescribed therefor in the Security.

SECTION 1107. Securities Redeemed in Part.

Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the Company or the Trustee for such Security so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and such Trustee duly executed by, the Holder thereof or his or her attorney duly authorized in writing), and the Company shall execute, and such Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series, and having endorsed thereon the Guarantee executed by the Guarantor of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

SECTION 1108. Offer to Redeem Upon Change of Control Triggering Event.

Upon the occurrence of a Change of Control Triggering Event, unless the Company has previously exercised its right to redeem the Securities in full, each Holder of Securities shall have the right to require the Company to purchase all or a portion of such Holder’s Securities pursuant to the offer described below (the “Change of Control Offer”) at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of purchase, subject to the rights of Holders of Securities on the relevant record date to receive interest due on the relevant interest payment date.

(i)(a) if mailed following the date upon which a Change of Control Triggering Event has occurred, that a Change of Control Triggering Event has occurred and that such Holder of Securities has the right to require the Company to purchase all or a portion of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of Securities of record on the relevant record date to receive interest on the relevant interest payment date), or (b) if mailed prior to any Change of Control but after the public announcement of a pending Change of Control, that a Change of Control is pending and, upon the occurrence of a Change of Control Triggering Event, such Holder of Securities has the right to require the Company to purchase all or a portion of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of Securities of record on the relevant record date to receive interest on the relevant interest payment date) and that the Change of Control Offer is conditioned on the Change of Control being consummated on or prior to the Change of Control Payment Date (as defined below);

(ii) the circumstances and relevant facts regarding such Change of Control Triggering Event;

(iii) the purchase date, which must be no earlier than 30 days nor later than 60 days from the date such notice is mailed, other than as may be required by law (the “Change of Control Payment Date”); and

(iv) the instructions determined by the Company, consistent with this Section, that a Holder of Securities must follow in order to have its Securities purchased.

Holders electing to have Securities purchased pursuant to a Change of Control Offer shall be required to surrender their Securities, with the form provided in Section 203 entitled “Option of Holder to Elect Purchase” on the reverse of the Securities completed, to the Paying Agent at the address specified in the notice, or transfer their Securities to the Paying Agent by book-entry transfer pursuant to the applicable procedures of the Paying Agent, prior to the close of business on the third Business Day prior to the Change of Control Payment Date. Holders of Securities shall be entitled to withdraw their election if the Paying Agent receives not later than one Business Day prior to the purchase date a telegram, telex facsimile transmission or letter setting forth the name of the Holder of Securities and a statement that such Holder is withdrawing its election to have such Security purchased.

On the Change of Control Payment Date, the Company will, to the extent lawful:

accept for payment all Securities (or portions of Securities) properly tendered pursuant to the Change of Control Offer;

deposit with the Paying Agent an amount equal to the aggregate payment in respect of all Securities (or portions of Securities) properly tendered pursuant to the Change of Control Offer; and

deliver or cause to be delivered to the Trustee the Securities properly accepted for purchase, together with an Officer’s Certificate stating the aggregate principal amount of Securities (or portions of Securities) being purchased.

The Paying Agent shall promptly mail to each Holder of properly tendered Securities the purchase price for the Securities, and the Trustee shall promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder new Securities equal in principal amount to any unpurchased portion of any Securities surrendered; provided , that each new Security shall be in a principal amount of $2,000 or an integral multiple of $1,000 thereof. A Security shall be deemed to have been accepted for purchase at the time the Paying Agent mails or delivers payment therefor to the Surrendering Holder.

The Company shall not be required to make a Change of Control Offer if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements in this Section 1108 for such an offer made by the Company and such third party purchases all properly tendered Securities not withdrawn under its offer.

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the purchase of the Securities as a result of a Change of Control Triggering Event. To the extent that the provisions of any such securities laws or regulations conflict with the Change of Control Offer provisions of the Securities, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Change of Control Offer provisions of the Securities by virtue of such conflict.

Each of the Company and the Guarantor shall use its reasonable best efforts to ensure that at all times at least two Rating Agencies are providing a rating for the Securities.

ARTICLE TWELVE

- SINKING FUNDS

SECTION 1201. Applicability of Article.

The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 301 for Securities of such series.

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a “mandatory sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an “optional sinking fund payment.” If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.

SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.

In lieu of making all or any part of any mandatory sinking fund payment with respect to any series of Securities in cash, the Company may at its option (a) deliver to the Trustee for such Securities, Securities of such series theretofore purchased or otherwise acquired (except upon redemption pursuant to the mandatory sinking fund) by the Company or receive credit for Securities of such series (not previously so credited) theretofore purchased or otherwise acquired (except as aforesaid) by the Company and delivered to such Trustee for cancellation pursuant to Section 309, (b) receive credit for optional sinking fund payments (not previously so credited) made pursuant to this Section, or (c) receive credit for Securities of such series (not previously so credited) redeemed by the Company through any optional redemption provision contained in the terms of such series. Securities so delivered or credited shall be received or credited by such Trustee at the sinking fund redemption price specified in such Securities.

SECTION 1203. Redemption of Securities for Sinking Fund.

Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee for the Securities of such series an Officer’s Certificate (which need not contain the statements required by Section 102) stating that no defaults in the

payment of interest, if any, with respect to Securities of that series and no Events of Default with respect to Securities of that series have occurred (which in either case have not been waived or cured) and (a) specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, (b) whether or not the Company intends to exercise its right, if any, to make an optional sinking fund payment with respect to such series on the next ensuing sinking fund payment date and, if so, the amount of such optional sinking fund payment, and (c) the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant to Section 1202, and will also deliver to such Trustee any Securities to be so delivered. Such written statement shall be irrevocable and upon its receipt by such Trustee the Company shall become unconditionally obligated to make all the cash payments or payments therein referred to, if any, on or before the next succeeding sinking fund payment date. Failure of the Company, on or before any such 60 ^th day, to deliver such written statement and Securities specified in this paragraph, if any, shall not constitute a default but shall constitute, on and as of such date, the irrevocable election of the Company (i) that the mandatory sinking fund payment for such series due on the next succeeding sinking fund payment date shall be paid entirely in cash without the option to deliver or credit Securities of such series in respect therefor and (ii) that the Company will make no optional sinking fund payment with respect to such series as provided in this Section.

Not less than 30 days before each such sinking fund payment date the Trustee for any series of Securities shall select the Securities of such series to be redeemed upon such sinking fund payment date in the manner specified in Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 1104. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 1105, 1106 and 1107.

The Trustee for any series of Securities shall not redeem or cause to be redeemed any Security of such series with sinking fund moneys or mail any notice of redemption of Securities of such series by operation of the sinking fund during the continuance of a default in payment of interest with respect to Securities of that series or an Event of Default with respect to the Securities of that series except that, where the mailing of notice of redemption of any Securities shall theretofore have been made, such Trustee shall redeem or cause to be redeemed such Securities; provided , that it shall have received from the Company a sum sufficient for such redemption. Except as aforesaid, any moneys in the sinking fund for such series at the time when any such default or Event of Default, shall occur, and any moneys thereafter paid into the sinking fund, shall, during the continuance of such default or Event of Default, be deemed to have been collected under Article Five and held for the payment of all such Securities. In case such Event of Default shall have been waived as provided in Section 513 or the default or Event of Default cured on or before the 60 ^th day preceding the sinking fund payment date, such moneys shall thereafter be applied on the next succeeding sinking fund payment date in accordance with this Section to the redemption of such Securities.

ARTICLE THIRTEEN

- GUARANTEE

SECTION 1301. Guarantee.

(a) Subject to the provisions of this Article Thirteen and for good and valuable consideration, the receipt of which is hereby acknowledged, the Guarantor hereby fully and unconditionally guarantees to each Holder of a Security of each series authenticated and delivered by the Trustee for such Securities hereunder and to such Trustee for itself and on behalf of each such Holder, the due and punctual payment of principal of (and premium, if any, on) and interest on the Securities when and as the same shall become due and payable, whether at the Stated Maturity, by declaration of acceleration, call for redemption or otherwise, and all other amounts owed under this Indenture, according to the terms thereof and of this Indenture. In case of the failure of the Company promptly to make any such payment of principal (and premium, if any, on) or interest, the Guarantor hereby agrees to make any such payment to be made promptly when and as the same shall become due and payable, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, and as if such payment were made by the Company.

(b) The Guarantor hereby agrees that its obligations hereunder shall be as if it were principal debtor and not merely surety, and shall be absolute and unconditional, joint and several, irrespective of, and shall be unaffected by any failure to enforce the provisions of such Security or this Indenture, or any waiver, modification or indulgence granted to the Company with respect thereto, by the Holder of such Security or the Trustee for the Securities of such series or any other circumstance which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided , however , that, notwithstanding the foregoing, no such waiver, modification or indulgence shall, without the consent of the Guarantor increase the principal amount of such Security, or increase the interest rate thereon, or increase any premium payable upon redemption thereof, or alter the Stated Maturity thereof, or increase the principal amount of any Original Issue Discount Security that would be due and payable upon a declaration of acceleration or the maturity thereof pursuant to Article Five of this Indenture. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Company, any right to require a proceeding first against the Company, protest or notice with respect to such Security or the indebtedness evidenced thereby or with respect to any sinking fund or analogous payment required under such Security and all demands whatsoever, and covenants that this Guarantee will not be discharged except by payment in full of the principal of (and premium, if any, on) and interest on such Security or as otherwise set forth in this Indenture; provided , that if any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantor or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Guarantor any amount paid either to the Trustee or such Holder, the Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.

(c) The Guarantor shall be subrogated to all rights of the Holder of such Security and the Trustee for the Securities of such series against the Company in respect of any amounts paid to such Holder by the Guarantor pursuant to the provisions of this Guarantee; provided , however , that the Guarantor shall not be entitled to enforce or to receive any payments arising out of or based upon such right of subrogation until the principal of (and premium, if any, on) and interest on all Securities of the same series issued under the Indenture shall have been paid in full.

SECTION 1302. Execution and Delivery of Guarantee.

The Guarantee to be endorsed on the Securities of each series shall include the terms of the Guarantee set forth in Section 1301 and any other terms that may be set forth in the form established pursuant to Section 206 with respect to such series. The Guarantor hereby agrees to execute the Guarantee, in a form established pursuant to Section 206, to be endorsed on each Security authenticated and delivered by the Trustee for the Securities of such series.

The Guarantee shall be executed in accordance with Section 303. The delivery of any Security by the Trustee for the Securities of such series, after the authentication thereof hereunder, shall constitute due delivery of the Guarantee endorsed thereon on behalf of the Guarantor. The Guarantor hereby agrees that its Guarantee set forth in Section 1301 shall remain in full force and effect notwithstanding any failure to endorse a Guarantee on any Security.

SECTION 1303. Notice to Trustee.

The Guarantor shall give prompt written notice to the Trustee for the Securities of such series of any fact known to the Guarantor which prohibits the making of any payment to or by such Trustee in respect of the Guarantee pursuant to the provisions of this Article Thirteen other than any agreement in effect on the date hereof.

SECTION 1304. This Article Not to Prevent Events of Default.

The failure to make a payment on account of principal of (and premium, if any, on) or interest on the Securities by reason of any provision of this Article will not be construed as preventing the occurrence of an Event of Default.

SECTION 1305. Amendment, Etc.

No amendment, modification or waiver of any provision of this Indenture relating to the Guarantor or consent to any departure by the Guarantor or any other Person from any such provision will in any event be effective unless it is signed by the Guarantor and the Trustee for the Securities of such series.

SECTION 1306. Limitation on Liability.

With respect to the Guarantor, the obligations of the Guarantor hereunder will be limited to the maximum amount, as will not result in the obligations of the Guarantor under the Guarantee constituting a fraudulent conveyance or fraudulent transfer, after giving effect to all other relevant liabilities of the Guarantor.

[Remainder of page left intentionally blank.]

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the day and year first above written.


INGERSOLL-RAND GLOBAL HOLDING COMPANY LIMITED, as the Company

By:		/s/ David S. Kuhl
		Name: David S. Kuhl
		Title: Vice President and Treasurer

INGERSOLL-RAND COMPANY LIMITED, as Guarantor

By:		/s/ David S. Kuhl
		Name: David S. Kuhl
		Title: Vice President and Treasurer



By:		/s/ Barbara A. Santoro
		Name: Barbara A. Santoro
		Title: Vice President and Secretary

WELLS FARGO BANK, N.A., as Trustee

By:		/s/ Raymond Dellicolli
		Title: Vice President

Exhibit 10.19

AMENDMENT TO THE

INGERSOLL-RAND COMPANY

MANAGEMENT INCENTIVE UNIT PLAN

WHEREAS, Ingersoll-Rand Company (the “Company”) maintains the Ingersoll-Rand Company Management Incentive Unit Plan (the “Plan”) to provide benefits to certain individuals employed by the Company and its subsidiaries; and

WHEREAS, no Management Incentive Unit Award has been made under the Plan since 1990, and all previously unvested awards under the Plan became vested on January 1, 2003; and

WHEREAS, under Article XV of the Plan, the Company has reserved the right to amend or terminate the Plan at any time; and

WHEREAS, the Company has decided to amend and/or clarify certain provisions of the Plan to assure compliance with the requirements of section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), if and to the extent that Section 409A applies to the Plan; and

WHEREAS , the Company has decided to limit its future obligations under the Plan and to simplify the future administration of the Plan.

NOW, THEREFORE, the Plan is hereby amended, effective January 1, 2009, as set forth below:

Notwithstanding any other provision of this Plan to the contrary, the amount standing to the credit of a Participant in the Incentive Ledger shall be paid to the Participant in a single lump sum payment on the first day of the month that is at least sixty (60) days following the date of the Participant’s separation from service, as determined under the general rules of section 409A. Notwithstanding the foregoing, in the event that the Participant is a specified employee, within the meaning of Section 409A(a)(2)(B)(i) on the date of the Participant’s separation from service, such payment shall not be made until the first day of the month that is at least six (6) months after the date of the Participant’s separation from service. In the event of the Participant’s death prior to separation from service (or prior to the expiration of the six (6) months following separation from service in the case of a specified employee), the lump sum payment shall be made to the Participant’s beneficiary on the first day of the month that is at least sixty (60) days following the date of the Participant’s death (or, if earlier, the first day of the month that is at least six (6) months following the date of the Participant’s separation from service).

Notwithstanding any other provision of the Plan to the contrary, neither the Committee nor the Company shall have the right to accelerate or otherwise modify the timing of payments under the Plan in a manner inconsistent with the requirements to Section 409A, and no Participant shall have any elective right relating to the time or method of payment under the Plan.

No additional cash payments shall be made to any Participant pursuant to Article VI of the Plan, and no Dividend Equivalents shall be credited to any Participant’s account in the Incentive Ledger pursuant to the first sentence of Article VIII(a) of the Plan, with respect to any dividend declared on the stock of Ingersoll-Rand Company Limited after December 31, 2008. The foregoing shall not affect any Participant’s right to have dividends with respect to Common Stock Equivalents that were credited to the Participant’s account on December 31, 2008 credited in the form of additional Common Stock Equivalents after December 31, 2008.

All capitalized terms used in this amendment have the same meaning as under the Plan.

IN WITNESS WHEREOF, the Company has caused this amendment to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

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Exhibit 10.26

AMENDMENT TO

EMPLOYEE SUPPLEMENTARY RETIREMENT AGREEMENT

In accordance with Paragraph 12 of the Employee Supplementary Retirement Agreement effective as of the 25th day of August, 1999 by and between the Ingersoll-Rand Company, hereinafter called the Company, and Herbert L. Henkel, hereinafter called the Employee (the “Agreement”), the Agreement is hereby amended as set forth below:

The last sentence of Paragraph 1 is hereby amended to read as follows:

Such payments shall commence as of the later of (a) the first day of the seventh month following the date of the Employee’s separation from service (as determined under the general rules under section 409A of the Internal Revenue Code of 1986, as amended), or (b) the first business day of the first calendar year following the date of the Employee’s separation from service.

A new Paragraph 14 is added to the Agreement to read as follows:

This Agreement shall be interpreted and carried out in accordance with all applicable requirements of section 409A of the Internal Revenue Code of 1986, as amended.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement this 22nd day of December, 2008.


Ingersoll-Rand Company

By:		/s/ Marcia J. Avedon

Title:		Senior Vice President, HR & Communications

/s/ Herbert L. Henkel
Employee

Exhibit 10.28

INGERSOLL-RAND COMPANY

SUPPLEMENTAL PENSION PLAN

(AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005)

INTRODUCTION

Ingersoll-Rand Company (the “Company”) maintains the Ingersoll-Rand Pension Plan Number One (the “Qualified Pension Plan”) for salaried employees employed by the Company and certain subsidiaries and affiliates of the Company (the “Employees”), under which benefits are subject to plan qualification limits imposed by the Internal Revenue Code of 1986, as amended (the “Code”).

The Company recognizes that in certain circumstances it is desirable to provide pension benefits to Employees which are supplemental to those provided by the Qualified Pension Plan. The circumstances in which supplemental benefits will be paid are:

•

when the limitation on benefits payable under the Company’s Qualified Pension Plan as specified in Section 415 of the Code (the “Section 415 Limits”) reduces the benefit otherwise payable under the Qualified Pension Plan;

•

when, effective for years after 1988, the limitation on the amount of compensation that may be taken into account in determining benefits under the Company’s Qualified Pension Plan, as specified in Section 401(a)(17) of the Code (the “Section 401(a)(17) Limit”), reduces the benefit otherwise payable under the Qualified Pension Plan, and

•

when the amount of compensation that may be taken into account in determining benefits under the Company’s Qualified Pension Plan due to deferrals under the IR Executive Deferred Compensation Plan (the “Deferral Plan”) further reduces the benefit otherwise payable under the Qualified Pension Plan.

Accordingly, the Company maintains this Supplemental Pension Plan to provide a vehicle under which supplemental benefits can be paid to salaried employees employed by the Company and certain subsidiaries and affiliates of the Company. This Supplemental Pension Plan was amended and restated effective for all persons who retire or otherwise terminate employment on or after January 1, 2003, except those persons employed by The Torrington Company, and superseded the provisions of the Company’s Supplemental Pension Plan maintained by the Company prior to January 1, 2003. This Supplemental Pension Plan is hereby amended and restated effective January 1, 2005. The provisions of the Supplemental Pension Plan, as in effect prior to January 1, 2003 shall continue to be applicable to persons employed by The Torrington Company.

Notwithstanding any other provision of this Supplemental Pension Plan to the contrary, no benefit shall be payable under this Supplemental Pension Plan if, pursuant to the effective date

rules of Section 885(d) of the American Jobs Creation Act of 2004 and Treasury Regulations section 1.409A-6(a) such benefit would be subject to Section 409A of the Code. Accordingly, the benefits payable under this Supplemental Pension Plan shall be limited (as further defined herein) to the benefits accrued and vested hereunder as of December 31, 2004, and all additional benefits of the kind provided hereunder shall be provided under the terms of the Ingersoll-Rand Company Supplemental Pension Plan II.

It is intended that this Supplemental Pension Plan be treated as “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of the Employee Retirement Income Security Act of 1974, as amended.

All capitalized terms that are not otherwise defined herein shall have the same meaning as under the Qualified Pension Plan.

SECTION 1

SUPPLEMENTAL PLAN BENEFITS

1.1

Excess Pension Benefit. An Employee shall be entitled to a benefit under this Supplemental Pension Plan only if his or her benefit determined under the Qualified Pension Plan is less than the amount such benefit would have been if (i) the Section 415 Limits did not apply, (ii) the definition of Compensation specified under such Qualified Pension Plan did not exclude compensation after 1988 in excess of the Section 401(a)(17) Limit, and (iii) the definition of Compensation specified under such Qualified Pension Plan did not exclude compensation deferred under the Deferral Plan.

If an Employee’s benefit from the Qualified Pension Plan is reduced as a result of any of the conditions described in the preceding paragraph, the amount of benefit to which the Employee shall be entitled to receive under this Supplemental Pension Plan shall be determined based on the excess of (a) over (b) where:

(a)

is the benefit which would have been payable under the terms of the Qualified Pension Plan as a single life annuity with benefits payable monthly if (i) the Section 415 Limits did not apply, (ii) the definition of Compensation specified under the Qualified Pension Plan did not exclude compensation after 1988 in excess of the Section 401(a)(17) Limit, (iii) the definition of Compensation specified under the Qualified Pension Plan did not exclude compensation deferred under the Deferral Plan; and (iv) the Employee had terminated service for purposes of the accrual and vesting of benefits under the Qualified Pension Plan on December 31, 2004; and

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(b)

is the benefit which would have been payable as a single life annuity to the Employee under the terms of the Qualified Pension Plan if the Employee had terminated service for purposes of the accrual and vesting of benefits under the Qualified Pension Plan on December 31, 2004.

Notwithstanding the terms of subparagraph (a), if an Employee elected by the Board of Directors of the Company as an officer of the Company attained age 62 on or before December 31, 2004, the amount determined under subparagraph (a) shall be determined without regard to any reduction under the terms of the Qualified Pension Plan by reason of the Employee’s Determination Date having preceded his Normal Retirement Date under the Qualified Pension Plan.

SECTION 2

VESTING

2.1

Vesting. An Employee shall be vested in the benefit provided under Section 1.1 of this Supplemental Pension Plan in accordance with the vesting provisions of the Qualified Pension Plan, but disregarding any vesting credit the Employee may have under the Qualified Pension Plan for periods after December 31, 2004.

SECTION 3

DISTRIBUTIONS

3.1	Time and Form of Benefit Payments.

(a)

Benefits vested in accordance with Section 2.1 and payable under this Supplemental Pension Plan shall be made in the event of termination of employment by reason of death, disability, retirement or otherwise. Benefits shall be payable solely in the form of a lump sum.

(b)

The lump sum amount payable to an Employee shall be the lump sum value of the single life annuity determined under Section 1.1 determined under the same interest and mortality assumptions and to determine lump sum distributions under the Qualified Pension Plan on December 31, 2004. Accordingly, the lump sum payment shall equal the lump sum amount that would have been payable to the Employee under this Supplemental Pension Program if the Employee had actually terminated employment in December 31, 2004, increased to reflect interest and the Employee’s survival until the Payment Date based on the same interest and mortality assumptions used to determine the lump sum amount that would have been payable if the Employee had terminated employment on December 31, 2004.

(c)

An Employee’s Payment Date shall be the later of (1) the first business day of the year following the year of the Employee’s termination of employment (or earlier separation from service under the general rules under section 409A of the Code),

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or (2) the first day of the sixth month following the date of the employee’s termination of employment (or earlier separation from service under the general rules under section 409A of the Code). However, an Employee who is a participant in the Ingersoll-Rand Company Elected Officers Supplemental Program or the Ingersoll-Rand Company Key Management Supplemental Program may file a deferral election under the Deferral Plan at least one year in advance of the Employee’s termination of employment (or earlier separation from service under the general rules under section 409A of the Code) to defer the payment under the Deferral Plan.

(d)

In the event a valid deferral election is made under the Deferral Plan, the lump sum amount that would have otherwise been payable under this Supplemental Pension Plan shall be credited to the Deferral Plan as soon as practicable after the Determination Date.

3.2

Payments to Beneficiaries. In the event that an Employee dies prior to the Payment Date, the benefit determined under Sections 1.1 and 3.1 shall be payable to the Employee’s beneficiary(ies) under the Qualified Pension Plan thirty (30) days after the date of the Employee’s death, or as soon as practicable thereafter.

3.3	Withholding. The Company shall be entitled to withhold from the payment due under this Supplemental Pension Plan any and all taxes of any nature required by any government to be withheld from such payment.

3.4	Loans. No loans to Employees shall be permitted under this Supplemental Pension Plan.

SECTION 4

MISCELLANEOUS

4.1	Amendment and Termination.

(a)

This Supplemental Pension Plan may, at any time and from time to time, be amended or terminated, without consent of any Employee or beneficiary by (i) the Board of Directors of Ingersoll-Rand Company Limited (“Limited”) or the Compensation Committee (as described in Section 4.3), or (ii) in the case of amendments which do not materially modify the provisions hereof, the Company’s Administrative Committee (as described in Section 4.3), provided, however, that no such amendment or termination shall reduce any benefits accrued or vested under the terms of this Supplemental Pension Plan as of the date of termination or amendment.

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(b)

Notwithstanding the foregoing, following a “change in control” of Limited, any amendment modifying or terminating this Supplemental Pension Plan shall have no force or effect. For purposes hereof, a “change in control” shall have the meaning designated: (i) in the Ingersoll-Rand Company Amended and Restated Grantor Trust Agreement dated August 6, 1999 between the Company and Wachovia Bank, as trustee, or (ii) in such other trust agreement that restates or supercedes the agreement referred to in clause (i), in either case for purposes of satisfying certain obligations to executive employees of Ingersoll-Rand Company. For purposes of this Section 4, the term “change in control” shall refer solely to a “change in control” of Ingersoll-Rand Company Limited.

4.2

No Contract of Employment. The establishment of this Supplemental Pension Plan or any modification thereof shall not give any Employee or other person the right to remain in the service of the Company or any of its subsidiaries or affiliates, and all Employees and other persons shall remain subject to discharge to the same extent as if the Supplemental Pension Plan had never been adopted.

4.3

Compensation Committee. This Supplemental Pension Plan shall be administered by the Compensation Committee appointed by the Board of Directors of Limited, or any successor committee appointed by Limited’s Board of Directors (the “Compensation Committee”). The Compensation Committee has delegated to the members of the administrative committee appointed by the Company’s Chief Executive Officer (the “Administrative Committee”) the authority to administer this Supplemental Pension Plan in accordance with its terms. Subject to review by the Compensation Committee, the Administrative Committee shall make all determinations as to the right of any person to a benefit. Any denial by the Administrative Committee of the claim for benefits under this Supplemental Pension Plan by an Employee or beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Employee or beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Employee or beneficiary whose claim for benefits has been denied for a review of the decision denying the claim.

4.4

Entire Agreement; Successors. This Supplemental Pension Plan, including any subsequently adopted amendments, shall constitute the entire agreement or contract between the Company and any Employee regarding this Supplemental Pension Plan. There are no covenants, promises, agreements, conditions or understandings, either oral or written between the Company and any Employee relating to the subject matter hereof, other than those set forth herein. This Supplemental Pension Plan and any amendment shall be binding on the Company and the Employee and their respective heirs, administrators, trustees, successors, and assigns, including but not limited to, any successors to the Company by merger, consolidation or otherwise by operation of law, and on all designated beneficiaries of the Employee.

4.5

Severability. If any provision of this Supplemental Pension Plan shall to any extent be invalid or unenforceable, the remainder of the Supplemental Pension Plan shall not be affected thereby, and each provision of the Supplemental Pension Plan shall be valid and enforced to the fullest extent permitted by law.

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4.6

Application of Plan Provisions. All relevant provisions of the Qualified Pension Plan shall apply to the extent applicable to the contractual obligations of the Company under this Supplemental Pension Plan. Benefits provided under the Supplemental Pension Plan are independent of, and in addition to, any payments made to Employees under any other plan, program, or agreement between the Company and Employees, or any other compensation payable to the Employee by the Company, or by any subsidiary, or affiliate of the Company.

4.7	Governing Law. Except as preempted by federal law, the laws of the state of New Jersey shall govern this Supplemental Pension Plan.

4.8

Participant as General Creditor. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligation hereunder for payment of benefits at its discretion, provided, however, that no Employee eligible to participate in this Supplemental Pension Plan shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under this Supplemental Pension Plan, such rights shall be no greater than the right of any, unsecured general creditor of the Company.

4.9

Nonassignability. The right of any Employee or any beneficiary in any benefit hereunder shall not be subject to attachment or other legal process for the debts of such Employee or beneficiary, nor shall any such benefit be subject to anticipation, alienation, sale, transfer, assignment or encumbrance.

IN WITNESS WHEREOF, the Company has caused this amendment and restatement to be executed by its duly authorized representative this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

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Exhibit 10.29

INGERSOLL-RAND COMPANY

SUPPLEMENTAL PENSION PLAN II

(EFFECTIVE JANUARY 1, 2005)

INTRODUCTION

The Company recognizes that in certain circumstances it is desirable to provide pension benefits to Employees that are supplemental to those provided by the Qualified Pension Plan. The circumstances in which supplemental benefits will be paid are:

•

when the limitation on benefits payable under the Company’s Qualified Pension Plan, as specified in Section 415 of the Code (the “Section 415 Limits”), reduces the benefit otherwise payable under the Qualified Pension Plan;

•

when the amount of compensation that may be taken into account in determining benefits under the Company’s Qualified Pension Plan due to deferrals under the IR Executive Deferred Compensation Plan or the IR Executive Deferred Compensation Plan II (collectively the “Deferral Plan”) further reduces the benefit otherwise payable under the Qualified Pension Plan.

The Company hereby adopts this Ingersoll-Rand Company Supplemental Pension Plan II (the “Supplemental Pension Plan II”), effective January 1, 2005, to provide supplemental pension benefits subject to Section 409A of the Code on substantially the same terms as those provided under the Ingersoll-Rand Company Supplemental Pension Plan (the “Predecessor Plan”) to the extent such terms are not inconsistent with Section 409A of the Code. The Supplemental Pension Plan II applies to benefits accrued or vested after December 31, 2004 that, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004 and Treasury Regulations section 1.409A-6(a) are subject to Section 409A of the Code.

It is intended that this Supplemental Pension Plan II be treated as “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of the Employee Retirement Income Security Act of 1974, as amended.

All capitalized terms that are not otherwise defined herein shall have the same meaning as under the Qualified Pension Plan. To the extent that Section 409A of the Code applies to the Supplemental Pension Plan II, the terms of the Supplemental Pension Plan II are intended to comply with Section 409A of the Code and any regulations or other administrative guidance issued thereunder, and such terms shall be interpreted and administered in accordance therewith.

SECTION 1

SUPPLEMENTAL PLAN BENEFITS

1.1

Excess Pension Benefit. An Employee shall be entitled to a benefit under this Supplemental Pension Plan II only if his or her benefit determined under the provisions of the Qualified Pension Plan is less than the amount such benefit would have been if (i) the Section 415 Limits did not apply, (ii) the definition of Compensation specified under the Qualified Pension Plan did not exclude compensation after 1988 in excess of the Section 401(a)(17) Limit, and (iii) the definition of Compensation specified under the Qualified Pension Plan did not exclude compensation deferred under the Deferral Plan.

If an Employee’s benefit from the Qualified Pension Plan is reduced as a result of any of the conditions described in the preceding paragraph, the benefit to which the Employee shall be entitled under this Supplemental Pension Plan II shall be equal to (a) minus (b) minus (c) where:

(a)

is the benefit that would have been payable under the terms of the Qualified Pension Plan, as a single life annuity with benefits payable monthly, if (i) the Section 415 Limits did not apply, (ii) the definition of Compensation specified under such Qualified Pension Plan did not exclude compensation after 1988 in excess of the Section 401(a)(17) Limit, and (iii) the definition of Compensation specified under the Qualified Pension Plan did not exclude compensation deferred under the Deferral Plan;

(b)

is the benefit actually payable as a single life annuity to the Employee under the terms of the Qualified Pension Plan; and

(c)

is the benefit payable to the Employee under the Predecessor Plan, expressed in the same form and with the same commencement date as the benefit payable to the Employee under this Supplemental Pension Plan II.

For purposes of this Section 1.1, the single life annuity payable under the terms of the Qualified Pension Plan and the benefit payable under the Predecessor Plan shall be determined as of the Employee’s Determination Date. The Determination Date shall be

the first date following the Employee’s separation from service (determined under the general rules under Section 409A of the Code) on which the Employee becomes eligible (or would have become eligible if the Employee’s termination of service under the Qualified Pension Plan had occurred on the date of such separation from service) to begin receiving payment of benefits under the Qualified Pension Plan, whether or not the Employee begins receiving benefits under the Qualified Pension Plan on that date.

Notwithstanding the terms of subparagraph (a), if an Employee elected by the Board of Directors of the Company as an officer of the Company has attained age 62, the amount determined under subparagraph (a) shall be determined without regard to any reduction under the terms of the Qualified Pension Plan by reason of the Employee’s Determination Date preceding his Normal Retirement Date under the Qualified Pension Plan.

SECTION 2

VESTING

2.1	Vesting. An Employee shall be vested in the benefit provided under Section 1.1 of this Supplemental Pension Plan II in accordance with the vesting provisions of the Qualified Pension Plan.

SECTION 3

DISTRIBUTIONS

3.1	Time and Form of Benefit Payment.

(a)

Benefits under this Supplemental Pension Plan II that are vested in accordance with Section 2.1 shall be payable solely in the form of a lump sum on the date (the “Payment Date”) that is the later of (1) the first business day of the first calendar year following the date of the Employee’s separation from service (as determined under the general rules under Section 409A of the Code), or (2) the first business day that is six months after the date of such separation from service.

(b)

The lump sum amount payable to an Employee under Section 3.1(a), shall be the lump sum value of the single life annuity determined under Section 1.1 hereof as of the Employee’s Determination Date. For purposes of this Section 3.1, the lump sum value shall be determined in the same manner as lump sum distributions are determined under the Qualified Pension Plan as of the Employee’s Determination Date. Such benefit shall be paid on the Employee’s Payment Date, together with interest accrued thereon from the Determination Date, (1) if the assets are held in trust, then at the interest rate of the trust, or (2) if the assets are not held in trust, at the interest rate equal to the average of the monthly rates for ten year constant maturities for U.S. Treasury Securities for the twelve month period immediately preceding the month prior to the month in which the Employee’s Determination Date occurred, as quoted by the Federal Reserve.

3.2

3.3	Withholding. The Company shall be entitled to withhold from the payment due under this Supplemental Pension Plan II any and all taxes of any nature required by any government to be withheld from such payment.

3.4	Loans. No loans to Employees shall be permitted under this Supplemental Pension Plan II.

SECTION 4

MISCELLANEOUS

4.1	Amendment and Termination.

(a)

This Supplemental Pension Plan II may, at any time and from time to time, be amended or terminated, without consent of any Employee or beneficiary (i) by the Board of Directors of Ingersoll-Rand Company Limited (“Limited”) or the Compensation Committee (as described in Section 4.3), or (ii) in the case of amendments which do not materially modify the provisions hereof, the Company’s Administrative Committee (as described in Section 4.3), provided, however, that no such amendment or termination shall reduce any benefits accrued or vested under the terms of this Supplemental Pension Plan II as of the date of termination or amendment.

(b)

Notwithstanding the foregoing, following a “change in control” of Limited, any amendment modifying or terminating this Supplemental Pension Plan II shall have no force or effect. For purposes hereof, a “change in control” shall have the meaning designated: (i) in the Ingersoll-Rand Company Amended and Restated Grantor Trust Agreement dated August 6, 1999 between the Company and Wachovia Bank, as trustee, or (ii) in such other trust agreement that restates or supercedes the agreement referred to in clause (i), in either case for purposes of satisfying certain obligations to executive employees of Ingersoll-Rand Company. For purposes of this Section 4, the term “change in control” shall refer solely to a “change in control” of Ingersoll-Rand Company Limited.

4.2

No Contract of Employment. The establishment of this Supplemental Pension Plan II or any modification thereof shall not give any Employee or other person the right to remain in the service of the Company or any of its subsidiaries or affiliates, and all Employees and other persons shall remain subject to discharge to the same extent as if the Supplemental Pension Plan II had never been adopted.

4.3

Compensation Committee. This Supplemental Pension Plan II shall be administered by the Compensation Committee appointed by the Board of Directors of Limited, or any successor committee appointed by the Board of Directors of Limited (the “Compensation Committee”). The Compensation Committee has delegated to the members of the administrative committee appointed by the Company’s Chief Executive Officer (the “Administrative Committee”) the authority to administer this Supplemental Pension Plan II in accordance with its terms. Subject to review by the Compensation Committee, the Administrative Committee shall make all determinations as to the right of any person to a benefit. Any denial by the Administrative Committee of the claim for benefits under this Supplemental Pension Plan II by an Employee or beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Employee or beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Employee or beneficiary whose claim for benefits has been denied for a review of the decision denying the claim.

4.4

Entire Agreement; Successors. This Supplemental Pension Plan II, including any subsequently adopted amendments, shall constitute the entire agreement or contract between the Company and any Employee regarding this Supplemental Pension Plan II. There are no covenants, promises, agreements, conditions or understandings, either oral or written between the Company and any Employee relating to the subject matter hereof, other than those set forth herein. This Supplemental Pension Plan II and any amendment shall be binding on the Company and the Employee and their respective heirs, administrators, trustees, successors, and assigns, including but not limited to, any successors to the Company by merger, consolidation or otherwise by operation of law, and on all designated beneficiaries of the Employee.

4.5

Severability. If any provision of this Supplemental Pension Plan II shall to any extent be invalid or unenforceable, the remainder of the Supplemental Pension Plan II shall not be affected thereby, and each provision of the Supplemental Pension Plan II shall be valid and enforced to the fullest extent permitted by law.

4.6

Application of Plan Provisions. All relevant provisions of the Qualified Pension Plans, to the extent not inconsistent with Section 409A of the Code, shall apply to the extent applicable to the contractual obligations of the Company under this Supplemental Pension Plan II. With respect to any Employee, the applicable provisions shall be those of the Qualified Pension Plan in which the Employee participates. Benefits provided under the Supplemental Pension Plan II are independent of, and in addition to, any payments made to Employees under any other plan, program, or agreement between the Company and Employees, or any other compensation payable to the Employee by the Company, or by any subsidiary, or affiliate of the Company.

4.7	Governing Laws. Except as preempted by federal law, the laws of the state of New Jersey shall govern this Supplemental Pension Plan II.

4.8

Participant as General Creditor. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligation hereunder for payment of benefits at its discretion, provided, however, that no Employee eligible to participate in this Supplemental Pension Plan II shall have any interest in such investment or reserve. This Supplemental Pension Plan II shall be unfunded for federal tax purposes. To the extent that any person acquires a right to receive benefits under this Supplemental Pension Plan II, such rights shall be no greater than the right of any, unsecured general creditor of the Company.

4.9

Nonassignability. The right of any Employee or any beneficiary in any benefit hereunder shall not be subject to attachment, garnishment, or other legal process for the debts of such Employee or beneficiary, nor shall any such benefit be subject to anticipation, alienation, sale, pledge, transfer, assignment or encumbrance.

IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized representative this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

Exhibit 10.30

INGERSOLL-RAND COMPANY

SUPPLEMENTAL EMPLOYEE SAVINGS PLAN

(AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2009)

INTRODUCTION

Ingersoll-Rand Company (the “Company”) established the Ingersoll-Rand Company Employee Savings Plan (the “Qualified Savings Plan”) effective January 1, 2003 for employees employed by the Company and certain subsidiaries and affiliates of the Company (the “Employees”), under which benefits do not reflect compensation of Employees in excess of the limitation imposed by Section 401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”) or Compensation deferred under the IR Executive Deferred Compensation Plan (the “Deferral Plan”).

The purpose of this amended and restated Ingersoll-Rand Company Supplemental Employee Savings Plan, which was formerly known as the Ingersoll-Rand Company Supplemental Savings and Stock Investment Plan (the “Supplemental Savings Plan”) is to provide a vehicle under which Employees can be paid benefits which are supplemental to benefits payable under the Qualified Savings Plan with respect to compensation that is not taken into account under the Qualified Savings Plan.

Effective August 1, 2002, the liabilities under the Ingersoll-Rand Company Supplemental Retirement Account Plan (the “Supplemental RAP”) were merged into this Supplemental Savings Plan. This Supplemental Savings Plan was last amended and restated effective January 1, 2003 with respect to all Employees except those Employees employed by The Torrington Company.

This Supplemental Savings Plan is hereby amended and restated effective January 1, 2009. The provisions of this Supplemental Savings Plan as in effect prior to January 1, 2003 shall continue to apply to Employees of The Torrington Company.

It is intended that this Supplemental Savings Plan be treated as “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of the Employee Retirement Income Security Act of 1974, as amended.

Unless otherwise indicated herein, capitalized terms shall have the same meanings as they have under the Qualified Savings Plan.

Notwithstanding any other provision of this Supplemental Savings Plan to the contrary, the terms of this Supplemental Savings Plan are limited to amounts credited to Employees accounts hereunder (including earnings on such amounts) with respect to compensation earned in years commencing prior to January 1, 2005 that pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004 and Treasury Regulations section 1.409A-6(a), are

not subject to the requirements of Section 409A of the Code. Effective January 1, 2005, the Company has established the Ingersoll-Rand Company Supplemental Savings Plan II to provide similar supplemental benefits that are subject to the requirements of Section 409A of the Code with respect to compensation earned by Employees in years commencing after December 31, 2004.

SECTION 1

PARTICIPATION

1.1

Participation. An Employee shall participate in this Supplemental Savings Plan if a Supplemental Company Contribution was credited or creditable to the Employee’s Account under Section 2.2 with respect to compensation earned for any year commencing before January 1, 2005. An Employee who had an account under the Supplemental RAP merged into this Supplemental Savings Plan on August 1, 2002 shall also be a participant in this Plan.

SECTION 2

ACCOUNTS/SUPPLEMENTAL BENEFITS

2.1	Accounts. The Company shall maintain on its books an account for each Employee who participates in this Supplemental Savings Plan (each an “Employee Account”). Such Employee Accounts shall be credited with Supplemental Company Contributions in accordance with Sections 2.2 and 2.3 hereof.

The Company shall maintain on its books an account for each Employee who had an account under the Supplemental RAP merged into this Supplemental Savings Plan (each a “Supplemental RAP Account”).

2.2

Company Contributions. An Employee shall be entitled to receive a Supplemental Company Contribution (credited as provided in Section 2.3) for any year commencing before January 1, 2005 in which the Employee’s Compensation for the year exceeds the limitation provided under Section 401(a)(17) of the Code and/or did not reflect compensation deferred under the Deferral Plan. The amount of Supplemental Company Contributions credited to the Employee Account for any such year shall equal (a) the Company Matching Contributions for such year, calculated as if the limitations described above did not apply, less (b) the Company Matching Contributions made with respect to the Employee under the Qualified Savings Plan.

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Contributions shall not be made to the Supplemental RAP Account on or after January 1, 2003. Contributions made to the Supplemental RAP Account prior to January 1, 2003 were made in accordance with the provisions of the Supplemental RAP in effect prior to January 1, 2003.

2.3	Common Stock Units.

(a)

For purposes hereof, the following terms shall have the meanings set forth below:

(i)

“Common Stock” means the Class A common shares, par value $1.00 per share, of Ingersoll-Rand Company Limited, a Bermuda company.

(ii)

“Common Stock Unit” means the right to receive dividends in respect of the Common Stock and the right to receive the Fair Market Value of a Unit.

(iii)

“Fair Market Value of a Unit” means the fair market value of one unit of Common Stock as determined under the recordkeeping procedures established for the Company Stock Fund under the Qualified Savings Plan.

(b)

All Supplemental Company Contributions shall be made by crediting to the Employee Account of each Employee eligible to participate in this Supplemental Savings Plan such number of Common Stock Units as will equal (i) the amount of Supplemental Company Contributions to which such Employee is entitled pursuant to Section 2.2, divided by (ii) the Fair Market Value of a Unit on the date such Supplemental Company Contribution is made. Crediting of Common Stock Units shall occur at the same time as determined under the recordkeeping procedures established for the Qualified Savings Plan.

(c)

On the date of payment of each cash dividend in respect of the Common Stock, each Employee Account shall be credited with additional Common Stock Units in the same manner and at the same time as determined under the recordkeeping procedures established for the Qualified Savings Plan.

(d)

In the event of any stock dividend on the Common Stock or any split-up or combination of shares of the Common Stock, appropriate adjustment shall be made by the Committee (hereinafter defined) in the aggregate number of Common Stock Units credited to each Employee Account.

2.4	Interest on Supplemental RAP Account.

Unless and until the Company establishes a trust pursuant to Section 6.1 hereof, the amounts credited to each Supplemental RAP Account shall be credited with interest at a rate equal to the rate of return earned by the money market investment option available under the Qualified Savings Plan and that is designated by the Committee as the money

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market investment option that shall apply for purposes of crediting interest under this Section 2.4. To the extent the Company contributes funds on behalf of an Employee to a trust established under Section 6.1 hereof, his Supplemental RAP Account hereunder shall be transferred to an account within such trust and shall be credited with the rate of return earned by the funds so contributed. Any unfunded portion of the Supplemental RAP Account shall continue to be credited with interest as provided above in this Section 2.4.

SECTION 3

VESTING

3.1	Vesting. An Employee shall at all times be fully vested in his Employee Account.

SECTION 4

DISTRIBUTIONS

4.1	Time of Distribution.

(a)

With respect to terminations of employment by reason of death, disability, retirement or otherwise occurring on or after May 29, 2003, the amounts payable to an Employee from his Employee Account and/or his Supplemental RAP Account hereunder shall be payable in a lump sum on the Employee’s Payment Date. The Payment Date for any Employee shall be the later of (a) the first business day of the calendar year following the date of the Employee’s termination of employment with the Company, or (b) the first business day of the sixth calendar month following the date of the Employee’s termination of employment with the Company, unless such Employee is a participant in the Ingersoll-Rand Company Elected Officers Supplemental Program or the Ingersoll-Rand Company Key Management Supplemental Program and such Employee filed a deferral election under the Deferral Plan at least one year in advance of such termination of employment to defer the payment of such lump sum under the Deferral Plan.

(b)

In the event a valid deferral election is made under the Deferral Plan, the lump sum amount that would have otherwise been payable under this Supplemental Savings Plan shall be credited to the Deferral Plan as soon as administratively practicable following the Employee’s termination of employment with the Company.

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(c)

Any such payment not deferred under the Deferral Plan shall be made to the Employee, or if the Employee is not then living, to the Employee’s beneficiary(ies) under the Qualified Savings Plan. Any payment to such beneficiary(ies) shall be payable thirty (30) days after the date of the Employee’s death, or as soon as practicable thereafter.

4.2	Form of Benefits.

(a)

With respect to terminations of employment by reason of death, disability, retirement or otherwise occurring on or after May 29, 2003, benefits payable from any Employee’s Employee Account shall be in the form of a cash lump-sum equal to (i) the number of Common Stock Units credited to such Employee’s Employee Account as of the date of such Employee’s termination of employment, multiplied by (ii) the Fair Market Value of a Unit on the Valuation Date. The amount payable pursuant to this Section 4.2(a) shall accrue interest based on the rate paid by the money market investment option available under the Qualified Savings Plan and that is designated by the Committee as the money market investment option that shall apply for purposes of accruing interest under this Section 4.2(a). Interest shall accrue until the Employee’s Payment Date.

(b)

Benefits payable from an Employee’s Supplemental RAP Account shall be in the form of a cash lump-sum equal to the amounts credited to such Employee’s Supplemental RAP Account as of the Employee’s Payment Date.

4.3	Valuation Date. For purposes hereof, the Valuation Date (as defined in the Qualified Savings Plan) shall be the date that is as soon as administratively practicable following an Employee’s termination of employment with the Company by reason of death, disability, retirement or otherwise.

4.4

Payment of Benefits. The benefits payable under this Supplemental Savings Plan shall be paid to an Employee (or beneficiary(ies)) by the Company, provided , however , that if the Company shall have made a contribution to a trust established under Section 5 hereof of all or a portion of the amount credited to such Employee’s Account and/or Supplemental RAP Account under this Supplemental Savings Plan (a) the amount paid to the Employee by the Company hereunder shall be reduced by the amount distributed to such Employee from such trust and (b) the amount distributed to such Employee from such trust shall be limited by the amount to which such Employee is entitled pursuant to Section 4.3 hereof.

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SECTION 5

TRUST FUND INVESTMENT

5.1

Establishment of Trust. Except as provided in Section 6.1 hereof, the Company shall have no obligation to fund the Employee Accounts and/or Supplemental RAP Accounts hereunder. The Company may, however, in its sole discretion, transfer assets to a trust fund to assist it in meeting its obligations under this Supplemental Savings Plan. The trust agreement shall provide that all amounts contributed to the trust, together with earnings thereon, shall be invested and reinvested as provided therein.

5.2	Rights of Creditors. The assets held by the trust shall be subject to the claims of general creditors of the Company in the event of the Company’s insolvency. The rights of an Employee to the assets of such trust fund shall not be superior to those of an unsecured creditor of the Company.

5.3	Disbursement of Funds. All contributions to the trust fund shall be held and disbursed in accordance with the provisions of the related trust agreement. No portion of the trust fund may be returned to the Company other than in accordance with the terms of the related trust agreement.

5.4

Company Obligation. Notwithstanding any provisions of any such trust agreement to the contrary, the Company shall remain obligated to pay benefits under this Supplemental Savings Plan. Nothing in this Supplemental Savings Plan or any such trust agreement shall relieve the Company of its liabilities to pay benefits under this Supplemental Savings Plan except to the extent those liabilities are met by the distribution of trust assets.

SECTION 6

CHANGE IN CONTROL

6.1

Contributions to Trust. In the event that the Board of Directors of Ingersoll-Rand Company is informed by the Board of Directors of Ingersoll-Rand Company Limited that a “change in control” of Ingersoll-Rand Company Limited has occurred, Ingersoll-Rand Company shall be obligated to establish a trust and to contribute to the trust an amount equal to the balance credited to each Employee’s Employee Account and/or Supplemental RAP Account established hereunder, such Employee Accounts and/or Supplemental RAP Accounts to be valued as of the last day of the calendar month immediately preceding the date the Board of Directors of Ingersoll-Rand Company was informed that a “change in control” has occurred.

6.2	Amendments. Following a “change in control” of Ingersoll-Rand Company Limited, any amendment modifying or terminating this Supplemental Savings Plan shall have no force or effect.

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6.3

Definition of Change in Control. For purposes hereof, a “change in control” shall have the meaning designated: (i) in the Ingersoll-Rand Company Amended and Restated Grantor Trust Agreement dated August 6, 1999, between the Company and Wachovia Bank, as trustee, or (ii) in such other trust agreement that restates or supercedes the agreement referred to in clause (i), in either case for purposes of satisfying certain obligations to executive employees of Ingersoll-Rand Company. Notwithstanding the foregoing, for purposes of this Section 6, the term “change in control” shall refer solely to a “change in control” of Ingersoll-Rand Company Limited.

SECTION 7

MISCELLANEOUS

7.1

Amendment and Termination. Except as provided in Section 6.2, this Supplemental Savings Plan may, at any time and from time to time, be amended or terminated without the consent of any Employee or beneficiary, by (a) the Board of Directors of Ingersoll-Rand Company Limited or the Compensation Committee (as described in Section 7.6), or (b) in the case of amendments which do not materially modify the provisions hereof, the Administrative Committee (as described in Section 7.6), provided , however , that no such amendment or termination shall reduce any benefits accrued or vested under the terms of this Supplemental Savings Plan as of the date of termination or amendment.

7.2

No Contract of Employment. The establishment of this Supplemental Savings Plan or any modification thereof shall not give any Employee or other person the right to remain in the service of the Company or any of its subsidiaries, and all Employees and other persons shall remain subject to discharge to the same extent as if the Supplemental Savings Plan had never been adopted.

7.3	Limitation of Rights. Nothing in this Supplemental Savings Plan shall be construed to give any Employee any rights whatsoever with respect to shares of Common Stock.

7.4	Withholding. The Company shall be entitled to withhold from any payment due under this Supplemental Savings Plan any and all taxes of any nature required by any government to be withheld from such payment.

7.5	Loans. No loans to Employees shall be permitted under this Supplemental Savings Plan.

7.6

Compensation Committee. This Supplemental Savings Plan shall be administered by the Compensation Committee (or any successor committee) of the Board of Directors of Ingersoll-Rand Company Limited (the “Compensation Committee”). The Compensation Committee has delegated to the Administrative Committee appointed by the Company’s Chief Executive Officer (the “Administrative Committee”) the authority

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to administer the Supplemental Savings Plan in accordance with its terms. Subject to review by the Compensation Committee, the Administrative Committee shall make all determinations as to the right of any person to a benefit. Any denial by the Administrative Committee of the claim for benefits under this Supplemental Savings Plan by an Employee or beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Employee or beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Employee or beneficiary whose claim for benefits has been denied for a review of the decision denying the claim.

7.7

Entire Agreement; Successors. This Supplemental Savings Plan, including any subsequently adopted amendments, shall constitute the entire agreement or contract between the Company and any Employee regarding this Supplemental Savings Plan. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Employee relating to the subject matter hereof, other than those set forth herein. This Supplemental Savings Plan and any amendment hereof shall be binding on the Company and the Employees and their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated beneficiaries of the Employee.

7.8

Severability. If any provision of this Supplemental Savings Plan shall, to any extent, be invalid or unenforceable, the remainder of this Supplemental Savings Plan shall not be affected thereby, and each provision of this Supplemental Savings Plan shall be valid and enforceable to the fullest extent permitted by law.

7.9

Application of Plan Provisions. All relevant provisions of the Qualified Savings Plan shall apply to the extent applicable to the obligations of the Company under this Supplemental Savings Plan. Benefits provided under this Supplemental Savings Plan are independent of, and in addition to, any payments made to Employees under any other plan, program, or agreement between the Company and Employees eligible to participate in this Supplemental Savings Plan, or any other compensation payable to any Employee by the Company or by any subsidiary or affiliate of the Company.

7.10	Governing Law. Except as preempted by federal law, the laws of the State of New Jersey shall govern this Supplemental Savings Plan.

7.11

Participant as General Creditor. Benefits under this Supplemental Savings Plan shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligation hereunder for payment of benefits at its discretion, provided , however , that no Employee eligible to participate in this Supplemental Savings Plan shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under this Supplemental Savings Plan, such rights shall be no greater than the right of any unsecured general creditor of the Company.

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7.12

Nonassignability. To the extent permitted by law, the right of any Employee or any beneficiary in any benefit hereunder shall not be subject to attachment or other legal process for the debts of such Employee or beneficiary; nor shall any such benefit be subject to anticipation, alienation, sale, transfer, assignment or encumbrance.

IN WITNESS WHEREOF, the Company has caused this amendment and restatement to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

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Exhibit 10.31

INGERSOLL-RAND COMPANY

SUPPLEMENTAL EMPLOYEE SAVINGS PLAN II

Effective January 1, 2005 and Amended and

Restated through January 1, 2009

INTRODUCTION

Ingersoll-Rand Company (the “Company”) established the Ingersoll-Rand Company Employee Savings Plan (the “Qualified Savings Plan”) effective January 1, 2003 for employees employed by the Company and certain subsidiaries and affiliates of the Company (the “Employees”), under which benefits do not reflect compensation of Employees in excess of the limitation imposed by Section 401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”) or compensation deferred under the IR Executive Deferred Compensation Plan II (the “Deferral Plan”). The Qualified Savings Plan is a continuation of the Ingersoll-Rand Company Savings and Stock Investment Plan.

The purpose of this Ingersoll-Rand Company Supplemental Employee Savings Plan II (the “Supplemental Savings Plan II”) is to provide a vehicle under which Employees can be paid benefits that are supplemental to benefits payable under the Qualified Savings Plan with respect to compensation that is not taken into account under the Qualified Savings Plan.

The Supplemental Savings Plan II is a continuation of the amended and restated Ingersoll-Rand Company Supplemental Employee Savings Plan (the “Predecessor Plan”), which was formerly known as the Ingersoll-Rand Company Supplemental Savings and Stock Investment Plan. The Company has frozen the Predecessor Plan with respect to all deferrals to the extent such deferrals would be subject to Section 409A of the Code.

The Company now hereby adopts this Supplemental Savings Plan II, effective January 1, 2005, to provide for deferrals of amounts subject to Section 409A of the Code on substantially the same terms as those provided under the Predecessor Plan to the extent such terms are not inconsistent with Section 409A of the Code. The Supplemental Savings Plan II shall apply to amounts credited to Employees accounts hereunder (including earnings on such amounts) with respect to compensation earned after December 31, 2004 that, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004 and Treasury Regulations section 1.409A-6(a) are subject to Section 409A of the Code.

It is intended that this Supplemental Savings Plan II be treated as “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of the Employee Retirement Income Security Act of 1974, as amended. To the extent that Section 409A of the Code applies to the Supplemental Savings Plan II, the terms of the Supplemental Savings Plan II are intended to comply with Section 409A of the Code and any regulations or other administrative guidance issued thereunder, and such terms shall be interpreted and administered in accordance therewith.

Unless otherwise indicated herein, capitalized terms shall have the same meanings that they have under the Qualified Savings Plan.

SECTION 1

PARTICIPATION

1.1	Participation. An Employee shall participate under this Supplemental Savings Plan II if a Supplemental Company Contribution is creditable to the Employee’s Account under Section 2.2 with respect to compensation earned for any year commencing after December 31, 2004.

SECTION 2

ACCOUNTS/SUPPLEMENTAL BENEFITS

2.1	Accounts. The Company shall establish on its books an account for each Employee who participates in this Supplemental Savings Plan II (each an “Employee Account”). Such Employee Accounts shall be credited with Supplemental Company Contributions in accordance with Sections 2.2 and 2.3 hereof.

2.2

Company Contributions. An Employee shall be entitled to receive a Supplemental Company Contribution (credited as provided in Section 2.3) for any year commencing after December 31, 2004 in which the Employee’s Compensation for the year exceeds the limitation provided under Section 401(a)(17) of the Code and/or did not reflect compensation deferred under the Deferral Plan. The amount of Supplemental Company Contributions credited to the Employee Account for any such year shall equal (a) the Company Matching Contributions for such year, calculated as if the limitations described above did not apply, less (b) the Company Matching Contributions made with respect to the Employee under the Qualified Savings Plan.

2.3	Common Stock Units.

(a)

For purposes hereof, the following terms shall have the meanings set forth below:

(i)

“Common Stock” means the Class A common shares, par value $1.00 per share, of Ingersoll-Rand Company Limited, a Bermuda company.

(ii)

“Common Stock Unit” means the right to receive dividends in respect of the Common Stock and the right to receive the Fair Market Value of a Unit.

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(iii)

(b)

All Supplemental Company Contributions shall be made by crediting to the Employee Account of each Employee eligible to participate in this Supplemental Savings Plan II such number of Common Stock Units as will equal (i) the amount of Supplemental Company Contributions to which such Employee is entitled pursuant to Section 2.2, divided by (ii) the Fair Market Value of a Unit on the date such Supplemental Company Contribution is made. Crediting of Common Stock Units shall occur at the same time as determined under the recordkeeping procedures established for the Qualified Savings Plan.

(c)

(d)

SECTION 3

VESTING

3.1	Vesting. An Employee shall at all times be fully vested in his Employee Account.

SECTION 4

DISTRIBUTIONS

4.1	Time of Distribution.

(a)

An Employee’s Employee Account shall be paid on the Employee’s Payment Date. The Payment Date for any Employee shall be the later of (a) the first business day of the first calendar year following the date of the Employee’s separation from service, or (b) the first business day that is six months after the date of such Employee’s separation from service. For purposes of this Section 4, the term “separation from service” means a separation from service under the general rules under Section 409A of the Code.

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(b)

Any payment under Section 4.1(a) shall be made to the Employee or, if the Employee is not then living, to the Employee’s beneficiary(ies) under the Qualified Savings Plan. Any payment to such beneficiary(ies) shall be payable thirty (30) days after the date of the Employee’s death, or as soon as practicable thereafter.

4.2

Form of Benefits. Benefits payable from any Employee’s Employee Account under Section 4.1 shall be in the form of a cash lump-sum and shall equal (i) the number of Common Stock Units credited to such Employee’s Employee Account as of the date of such Employee’s separation from service, multiplied by (ii) the Fair Market Value of a Unit on the Valuation Date. The amount payable pursuant to this Section 4.2 shall accrue interest based on the rate paid by the money market investment option available under the Qualified Savings Plan and that is designated by the Committee as the money market investment option that shall apply for purposes of accruing interest under this Section 4.2. Interest shall accrue until the Employee’s Payment Date. For purposes hereof, the Valuation Date (as defined in the Qualified Savings Plan) shall be the date that is as soon as administratively practicable following the Employee’s separation from service.

4.3

Payment of Benefits. The benefits payable under this Supplemental Savings Plan II shall be paid to an Employee (or beneficiary(ies)) by the Company, provided , however , that if the Company shall have made a contribution to a trust established under Section 5 hereof of all or a portion of the amount credited to such Employee’s Account under this Supplemental Savings Plan II, the amount paid to the Employee by the Company hereunder shall be reduced by the amount distributed to such Employee from such trust, and the amount distributed to such Employee from such trust shall be limited by the amount to which such Employee is entitled pursuant to Section 4.2 hereof.

SECTION 5

TRUST FUND INVESTMENT

5.1

Establishment of Trust. Except as provided in Section 6.1 hereof, the Company shall have no obligation to fund the Employee Accounts hereunder. The Company may, however, in its sole discretion transfer assets to a trust fund to assist it in meeting its obligations under this Supplemental Savings Plan II. The trust agreement shall provide that all amounts contributed to the trust, together with earnings thereon, shall be invested and reinvested as provided therein.

5.2	Rights of Creditors. The assets held by the trust shall be subject to the claims of general creditors of the Company in the event of the Company’s insolvency. The rights of an Employee to the assets of such trust fund shall not be superior to those of an unsecured creditor of the Company.

5.3	Disbursement of Funds. All contributions to the trust fund shall be held and disbursed in accordance with the provisions of the related trust agreement. No portion of the trust fund may be returned to the Company other than in accordance with the terms of the related trust agreement.

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5.4

Company Obligation. Notwithstanding any provisions of any such trust agreement to the contrary, the Company shall remain obligated to pay benefits under this Supplemental Savings Plan II. Nothing in this Supplemental Savings Plan II or any such trust agreement shall relieve the Company of its liabilities to pay benefits under this Supplemental Savings Plan II except to the extent those liabilities are met by the distribution of trust assets.

SECTION 6

CHANGE IN CONTROL

6.1

Contributions to Trust. In the event that the Board of Directors of Ingersoll-Rand Company is informed by the Board of Directors of Ingersoll-Rand Company Limited that a “change in control” of Ingersoll-Rand Company Limited has occurred, Ingersoll-Rand Company shall be obligated to establish a trust and to contribute to the trust an amount equal to the balance credited to each Employee’s Employee Account established hereunder, such Employee Accounts to be valued as of the last day of the calendar month immediately preceding the date the Board of Directors of Ingersoll-Rand Company was informed that a “change in control” has occurred.

6.2	Amendments. Following a “change in control” of Ingersoll-Rand Company Limited, any amendment modifying or terminating this Supplemental Savings Plan II shall have no force or effect.

6.3

Definition of Change in Control. For purposes hereof, a “change in control” shall have the meaning designated: (i) in the Ingersoll-Rand Company Amended and Restated Grantor Trust Agreement dated August 6, 1999 between the Company and Wachovia Bank, as trustee, or (ii) in such other trust agreement that restates or supercedes the agreement referred to in clause (i), in either case for purposes of satisfying certain obligations to executive employees of Ingersoll-Rand Company. For purposes of this Section 6, the term “change in control” shall refer solely to a “change in control” of Ingersoll-Rand Company Limited.

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SECTION 7

MISCELLANEOUS

7.1

Amendment and Termination. Except as provided in Section 6.2, this Supplemental Savings Plan II may, at any time and from time to time, be amended or terminated without the consent of any Employee or beneficiary, (a) by the Board of Directors of Ingersoll-Rand Company Limited or the Compensation Committee (as designated in Section 7.6), or (b) in the case of amendments which do not materially modify the provisions hereof, the Administrative Committee (as described in Section 7.6), provided , however , that no such amendment or termination shall reduce any benefits accrued under the terms of this Supplemental Savings Plan II as of the date of termination or amendment.

7.2

No Contract of Employment. The establishment of this Supplemental Savings Plan II or any modification thereof shall not give any Employee or other person the right to remain in the service of the Company or any of its subsidiaries, and all Employees and other persons shall remain subject to discharge to the same extent as if the Supplemental Savings Plan II had never been adopted.

7.3	Limitation of Rights. Nothing in this Supplemental Savings Plan II shall be construed to give any Employee any rights whatsoever with respect to shares of Common Stock.

7.4	Withholding. The Company shall be entitled to withhold from any payment due under this Supplemental Savings Plan II any and all taxes of any nature required by any government to be withheld from such payment.

7.5	Loans. No loans to Employees shall be permitted under this Supplemental Savings Plan II.

7.6

Compensation Committee. This Supplemental Savings Plan II shall be administered by the Compensation Committee (or any successor committee) of the Board of Directors of Ingersoll-Rand Company Limited (the “Compensation Committee”). The Compensation Committee has delegated to the Administrative Committee appointed by the Company’s Chief Executive Officer (the “Administrative Committee”) the authority to administer this Supplemental Savings Plan II in accordance with its terms. Subject to review by the Compensation Committee, the Administrative Committee shall make all determinations as to the right of any person to a benefit. Any denial by the Administrative Committee of the claim for benefits under this Supplemental Savings Plan II by an Employee or beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Employee or beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Employee or beneficiary whose claim for benefits has been denied for a review of the decision denying the claim.

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7.7

Entire Agreement; Successors. This Supplemental Savings Plan II, including any subsequently adopted amendments, shall constitute the entire agreement or contract between the Company and any Employee regarding this Supplemental Savings Plan II. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Employee relating to the subject matter hereof, other than those set forth herein. This Supplemental Savings Plan II and any amendment hereof shall be binding on the Company and the Employees and their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated beneficiaries of the Employee.

7.8

Severability. If any provision of this Supplemental Savings Plan II shall, to any extent, be invalid or unenforceable, the remainder of this Supplemental Savings Plan II shall not be affected thereby, and each provision of this Supplemental Savings Plan II shall be valid and enforceable to the fullest extent permitted by law.

7.9

Application of Plan Provisions. All relevant provisions of the Qualified Savings Plan, to the extent not inconsistent with Section 409A of the Code, shall apply to the extent applicable to the obligations of the Company under this Supplemental Savings Plan II. Benefits provided under this Supplemental Savings Plan II are independent of, and in addition to, any payments made to Employees under any other plan, program, or agreement between the Company and Employees eligible to participate in this Supplemental Savings Plan II, or any other compensation payable to any Employee by the Company or by any subsidiary or affiliate of the Company.

7.10	Governing Law. Except as preempted by federal law, the laws of the State of New Jersey shall govern this Supplemental Savings Plan II.

7.11

Participant as General Creditor. Benefits under this Supplemental Savings Plan II shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligation hereunder for payment of benefits at its discretion, provided , however , that no Employee eligible to participate in this Supplemental Savings Plan II shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under this Supplemental Savings Plan II, such rights shall be no greater than the right of any unsecured general creditor of the Company.

7.12

Nonassignability. To the extent permitted by law, the right of any Employee or any beneficiary in any benefit hereunder shall not be subject to attachment, garnishment, or other legal process for the debts of such Employee or beneficiary; nor shall any such benefit be subject to anticipation, alienation, sale, pledge, transfer, assignment or encumbrance.

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IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

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Exhibit 10.36

INGERSOLL-RAND COMPANY

ELECTED OFFICERS SUPPLEMENTAL PROGRAM II

Effective January 1, 2005

Amended and Restated Effective January 1, 2009

INGERSOLL-RAND COMPANY

ELECTED OFFICERS SUPPLEMENTAL PROGRAM II

TABLE OF CONTENTS


		Page
INTRODUCTION		1

ARTICLE 1 - DEFINITIONS

1.1	Actuarial Equivalent	2
1.2	Board	2
1.3	Change in Control	2
1.4	Company	2
1.5	Compensation Committee	2
1.6	Deferral Plan	2
1.7	Elected Officer	2
1.8	Employee	2
1.9	Employer	2
1.10	Estate Program	2
1.11	Final Average Pay	3
1.12	Foreign Plan	3
1.13	Pension Plan	3
1.14	Predecessor Program	3
1.15	Program	3
1.16	Retirement	3
1.17	Separation from Service	4
1.18	Year of Service	4

ARTICLE 2 - PARTICIPATION

2.1	Commencement of Participation	4
2.2	Duration of Participation	4

ARTICLE 3 - AMOUNT OF BENEFIT

3.1	Amount of Benefit	4

ARTICLE 4 - VESTING

4.1	Vesting	5
4.2	Forfeiture for Cause	5

INGERSOLL-RAND COMPANY

TABLE OF CONTENTS (cont.)


		Page
ARTICLE 5 - DISTRIBUTIONS

5.1	Retirement	6
5.2	Time and Form of Distribution	7
5.3	Disability	7
5.4	Death	8
5.5	No Acceleration	9

ARTICLE 6 - FUNDING

6.1	Funding	9
6.2	Company Obligation	9

ARTICLE 7 - CHANGE IN CONTROL

7.1	Contributions to Trust	9
7.2	Amendments	10

ARTICLE 8 - MISCELLANEOUS

8.1	Amendment and Termination	10
8.2	No Contract of Employment	10
8.3	Withholding	10
8.4	Loans	10
8.5	Compensation Committee	11
8.6	Entire Agreement; Successors	11
8.7	Severability	11
8.8	Governing Law	11
8.9	Participant as General Creditor	12
8.10	Nonassignability	12

APPENDIX A		14

INTRODUCTION

Ingersoll-Rand Company (the “Company”) adopted this Ingersoll-Rand Company Elected Officers Supplemental Program II (the “Program”), effective January 1, 2005, to provide supplemental retirement benefits to certain key management individuals employed by the Company and its affiliates in addition to the benefits provided from other qualified and non-qualified plans maintained by the Company and its affiliates. The Program shall be unfunded for tax purposes and for purposes of Title I of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”). The terms of the Program are intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and any regulations or other administrative guidance issued thereunder, and the terms of the Program shall be interpreted and administered in accordance therewith.

The Program is a continuation of the Ingersoll-Rand Company Elected Officers Supplemental Program (the “Predecessor Program”). The Predecessor Program became effective on June 30, 1995 and was amended and restated, effective January 1, 2003, and was thereafter amended. Effective December 31, 2004, the Company froze the Predecessor Program to exclude all subsequently deferred amounts that would otherwise be subject to Code Section 409A, including benefits accrued under the Predecessor Program as of December 31, 2004 that were not vested as of that date.

The Company has adopted the Program to provide supplemental retirement benefits subject to Code Section 409A on substantially the same terms as those provided under the Predecessor Program to the extent such terms are not inconsistent with Code Section 409A. The Program shall apply to benefits accrued or vested on or after January 1, 2005 that, pursuant to the effective date rules of Code Section 409A, are subject to the provisions of Code Section 409A.

The Company now hereby amends and restates the Program effective as of January 1, 2009.

ARTICLE 1

DEFINITIONS

1.1

“Actuarial Equivalent” means an amount having equal value to a single life annuity when computed on the basis of the mortality table specified in the Pension Plan and an interest rate equal to the average of the monthly rates for ten-year Constant Maturities for US Treasury Securities for the twelve-month period immediately preceding the month prior to the month in which a determination of benefit occurs, such rate as published in Federal Reserve statistical release H.15(519).

1.2

“Board” means the Board of Directors of Ingersoll-Rand Company Limited.

1.3

“Change in Control” shall have the same meaning as such term is defined in the Ingersoll-Rand Company Limited Incentive Stock Plan of 2007 or any successor or replacement plan thereto, unless a different definition is used for purposes of a change in control event in any severance or employment agreement between an Employer and an Employee, in which event as to such Employee such definition shall apply. The term Change in Control shall refer solely to a Change in Control of Ingersoll-Rand Company Limited.

1.4

“Company” means Ingersoll-Rand Company, and its successors or assigns.

1.5

“Compensation Committee” means the Compensation Committee of the Board.

1.6

“Deferral Plan” means the IR Executive Deferred Compensation Plan and/or the IR Executive Deferred Compensation Plan II.

1.7

“Elected Officer” means an individual elected by the Board as an officer of Ingersoll-Rand Company Limited.

1.8

“Employee” means an individual eligible to participate in the Program as provided in Section 2.1.

1.9

“Employer” means the Company and any domestic or foreign entity in which the Company owns (directly or indirectly) a 50% or greater interest.

1.10

“Estate Program” means the Ingersoll-Rand Company Estate Enhancement Program.

1.11

“Final Average Pay” means, except as provided in Section 5.3 for purposes of disability, the sum of the following:

(a)

for Employees actively employed by an Employer on or after February 1, 2006, the average of each of the three highest bonus awards from the Employer (whether the awards are paid to the Employee, are a Deferral Amount (as such term is defined in the Deferral Plan) or the Employee has elected to forgo a bonus award pursuant to the Estate Program) for the six most recent calendar years, including the year during which the Employee’s Separation from Service occurs, or a Change in Control occurs, but excluding Supplemental Contributions (as such term is defined in the Deferral Plan) or any amounts paid from the Deferred Compensation Account (as such term is defined in the Deferral Plan) or any other account under the Deferral Plan including, but not limited to, amounts paid consisting of Deferral Amounts and Supplemental Contributions and their earnings, and any amounts paid by the Company pursuant to the Estate Program, and

(b)

the Employee’s annualized base salary from the Employer in effect immediately prior to the Employee’s Separation from Service unreduced by any Deferral Amount (as defined in the Deferral Plan) or other elective salary reduction contributions to any plan.

For any Employee who terminated employment with an Employer prior to February 1, 2006, the phrase “five highest bonus awards” shall be substituted for the phrase “three highest bonus awards” in subsection (a). An Employee’s Final Average Pay shall not take account of any bonus awards made by an employer that was not, at the time of the award, an Employer.

1.12

“Foreign Plan” means (i) any plan or program maintained by a foreign Employer (an Employer that is not an entity organized under the laws of the United States) under which cash benefits are payable to an Employee following retirement or other termination of employment, regardless of the form or structure of such plan, and (ii) any other plan, program, or system providing such benefits in respect of services performed by such an Employee for a foreign Employer that is established by the government of a foreign country, mandated under the laws of a foreign country or under a government decree or directive having the force of law, or mandated or maintained under any collective bargaining or similar agreement.

1.13

“Pension Plan” means the Ingersoll-Rand Pension Plan Number One as in effect on January 1, 2003, and as may be amended from time to time.

1.14

“Predecessor Program” means the Ingersoll-Rand Company Elected Officers Supplemental Program, as effective on June 30, 1995, as amended and restated, effective January 1, 2003, and as thereafter amended.

1.15

“Program” means the Ingersoll-Rand Company Elected Officers Supplemental Program II as stated herein and as may be amended from time to time.

1.16

“Retirement” means an Employee’s Separation from Service other than by reason of death or disability (as defined in Section 5.3) at a time when the Employee has satisfied the vesting requirements of Section 4.1.

1.17

“Separation from Service” means an Employer’s separation from service as determined under the general rules under Section 409A of the Code.

1.18

“Year of Service” shall be determined in accordance with the provisions of the Pension Plan or such other qualified defined benefit pension plan or Foreign Plan in which an Employee participates that are applicable to determining the Employee’s years of vesting service under such plan. For purposes of this Section, a qualified defined benefit pension plan means a plan defined in Code Section 414(j) which is sponsored by an Employer. Notwithstanding any provision of the Program to the contrary, in the event an Employee earns one or more hours of service during a calendar year, he shall be credited with a Year of Service with respect to such year for purposes of the Program. Unless otherwise agreed by the Company, an Employee’s Years of Service shall exclude any period of service during which the employer of the Employee was not an Employer under the Program, and shall not include any period of service in a calendar year following the year of the Employee’s Separation from Service.

Whenever the word “he”, “his,” or “him” is used in the Program, such word is intended to embrace within its purview the word “she” or “her”, as may be appropriate.

ARTICLE 2

PARTICIPATION

2.1

Commencement of Participation

An individual employed by the Company shall commence participation in the Program upon (a) becoming an Elected Officer of the Company (or of Ingersoll-Rand Company Limited) and (b) being approved for participation by the Compensation Committee.

2.2

Duration of Participation

An Employee shall continue to participate in the Program until all benefits accrued hereunder have been paid or forfeited.

ARTICLE 3

AMOUNT OF BENEFIT

3.1

Amount of Benefit

An Employee who is a participant in the Program shall be entitled to receive a benefit, determined as of the date of the Employee’s Retirement, death, or, in the case of disability, attainment of age 65, that is equal to (a) minus the sum of (b) and (c), where:

(a)

is the lump sum Actuarial Equivalent of a single life annuity that is equal to the product of:

(i)

his Final Average Pay,

(ii)

his Years of Service (up to a maximum of 35 Years of Service), and

(iii)

1.9% (as further adjusted to give effect to any adjustments required under Sections 5.1, 5.2, and 5.4);

(b)

the benefit offset amount as determined under Appendix A attached hereto from the Pension Plan and any other plan(s) identified in Appendix A; and

(c)

is the benefit payable to the Employee under the Predecessor Program, expressed in the same form and with the same commencement date as the benefit payable to the Employee under this Program.

ARTICLE 4

VESTING

4.1

Vesting

An Employee shall become vested in the benefit provided under the Program upon the earliest of (i) attainment of age 55 and the completion of 5 Years of Service, (ii) attainment of age 62, (iii) death, (iv) disability (to the extent provided in Section 5.3), or (v) a Change in Control. An Employee shall forfeit all right to benefits under the Program upon ceasing to be an employee of any Employer prior to satisfying any of the foregoing vesting conditions.

4.2

Forfeiture for Cause

All benefits for which an Employee would otherwise be eligible hereunder may be forfeited, at the discretion of the Compensation Committee, under the following circumstances:

(a)

The Employee is discharged by the Company for cause, which shall be a breach of the standards set forth in the Ingersoll-Rand Company Code of Conduct; or

(b)

Determination by the Compensation Committee no later than 12 months after termination of employment that the Employee has engaged in serious or willful misconduct in connection with his employment with the Company; or

(c)

The Employee (whether while employed or for two years thereafter) without the written consent of the Company is employed by, becomes associated with, renders service to, or owns an interest in any business that is competitive with the Company or with any business in which the Company has a substantial interest as determined by the Compensation Committee; provided, however, that an Employee may own up to 1% of the publicly traded equity securities of any business, notwithstanding the foregoing.

ARTICLE 5

DISTRIBUTIONS

5.1

Retirement

Upon an Employee’s Retirement, the benefit described in Section 3.1 shall be subject to further adjustment as follows:

(a)

Retirement at Age 62 – Upon attaining age 62, an Employee may retire and receive the benefit determined under Section 3.1.

(b)

Retirement before Age 62 – If an Employee who has become vested in accordance with Section 4.1 retires before attaining age 62, he will receive a benefit under the Program equal to the benefit he would have received upon Retirement at age 62, provided however that:

(i)

the amount determined under Section 3.1(a) shall be reduced by 0.429% for each month that the date of the Employee’s Retirement precedes attainment of age 65;

(ii)

the benefit offset amount as determined under Appendix A from the Pension Plan and any other plan(s) identified in Appendix A, as adjusted under the terms of the applicable plan(s) for retirement to the earliest date on which the Employee may retire and begin receiving a benefit under such plan(s), and as further adjusted, if necessary, to an actuarially equivalent benefit payable on the date of the Employee’s Retirement; and

(iii)

for years prior to Social Security normal retirement age, the Social Security Primary Insurance Amount (as defined in Appendix A) shall be reduced by the same factors used by the Social Security Administration to adjust benefits payable at age 62 or later, and by 0.3% for each month that the date of the Employee’s Retirement precedes attainment of age 62.

(c)

Retirement after Age 62 – If an Employee retires after age 62, he will receive a benefit equal to the greater of:

(i)

the benefit determined under Section 3.1 as of his date of Retirement, or

(ii)

the benefit he would have received had his Retirement occurred at age 62, credited with interest from the date he attained age 62 until his date of Retirement. For purposes of this subsection (ii), the interest rate will be equal to the average of the monthly rates for ten-year Constant Maturities for US Treasury Securities for the twelve-month period immediately preceding the month prior to the month in which a determination of benefit occurs, as quoted by the Federal Reserve.

5.2

Time and Form of Distribution

(a)

Benefits under the Program shall be payable solely in a single lump sum. In the case of Retirement, the lump sum benefit shall be paid on the later of (i) the first business day that is six months after the date of the Employee’s Retirement, or (ii) the first business day of the calendar year following the year of the Employee’s Retirement. In the case of disability or death, the lump sum benefit shall be paid on the payment date prescribed by Section 5.3 or Section 5.4, as applicable.

(b)

The lump sum amount determined under Sections 3.1 and 5.1, shall be credited with interest from the determination date under Section 3.1 until the date of distribution at the average of the monthly rates for ten-year Constant Maturities for U.S. Treasury Securities for the twelve-month period immediately preceding the month prior to the month in which a determination of benefit occurs, as quoted by the Federal Reserve.

5.3

Disability

An Employee who becomes disabled prior to his or her Separation from Service and who remains continuously disabled until attaining age 65 (or earlier death) shall continue to accrue benefits (and Years of Service) under the Program as if he continued to be employed by the Company and his Retirement occurred upon his attainment of age 65 (or earlier death). Such Employee shall be paid the lump sum, determined under Sections 3.1 and 5.2 of the Program, on the first business day of the month following the month the Employee attains age 65 (or such earlier date applicable to death benefits under Section 5.4(a)).

Notwithstanding any other provision of the Program to the contrary, when determining Final Average Pay for an Employee who is disabled under the provisions of this Section, Final Average Pay means the sum of:

(a)

the average of each of the three highest bonus awards (whether the awards are paid to the Employee, are a Deferral Amount (as such term is defined in the Deferral Plan) or the Employee has elected to forgo a bonus award pursuant to the Estate Program) during the six most recent calendar years, including the year during which the Employee’s disability occurs, (or, if the average of the three highest bonus awards would be greater, the six most recent calendar years prior to the year in which the Employee’s disability occurs), but excluding Supplemental Contributions (as such term is defined in the Deferral Plan) or any amounts paid from the Deferred Compensation Account (as such term is defined in the Deferral Plan) or any other account under the Deferral Plan including, but not limited to, amounts paid consisting of Deferral Amounts and Supplemental Contributions and their earnings, and any amounts paid by the Company pursuant to the Estate Program, and

(b)

the Employee’s annualized base salary in effect as of the date he became disabled.

An Employee who is no longer disabled under this Section 5.3 and who returns to the employ of an Employer, shall be entitled to accrue benefits under this Section 5.3 for the period of his disability.

An Employee who is no longer disabled under this Section 5.3 and who does not return to the employ of the Company or an affiliated company, shall not be entitled to accrue any benefits under this Section 5.3 for any portion of the period of his disability.

For purposes of the Program, an Employee shall be disabled if he has: (a) a condition under which the Employee: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months; or (ii) is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company; or (b) any other condition under which the Employee is considered “disabled” within the meaning of Code Section 409A(a)(2)(C).

5.4

Death

(a)

In the event of an Employee’s death prior to Retirement, his beneficiary shall receive a lump sum payment determined under Section 3.1 as if the Employee retired on the date of death, provided that if the Employee’s death occurs prior to his attainment of age 55, such death benefit shall be reduced by 0.3% for each month that the benefit commences before the Employee would have reached age 65. Such lump sum benefit shall be payable thirty (30) days after the date of the Employee’s death, or as soon as practicable thereafter.

(b)

The Employee’s beneficiary(ies) shall be the same as the Employee’s beneficiary(ies) under the Pension Plan, or, if the Employee was not a participant in the Pension Plan, such other qualified defined benefit pension plan or Foreign Plan in which the Employee has participated. If the Employee was not a participant in, or has no beneficiary under, the Pension Plan, another qualified defined benefit pension plan, or a Foreign Plan, the Employee’s estate shall be the beneficiary.

5.5

No Acceleration

Except to the extent permitted under Code Section 409A, no benefits or payments under the Program shall be accelerated at any time.

ARTICLE 6

FUNDING

6.1

Funding

Except as provided in Section 7.1 hereof, neither the Company nor any of its affiliates shall have any obligation to fund the benefit that an Employee earns under the Program.

6.2

Company Obligation

Notwithstanding the provisions of any trust agreement or similar funding vehicle to the contrary, the Company shall remain obligated to pay benefits under the Program. Nothing in the Program or any trust agreement shall relieve the Company of its liabilities to pay benefits under the Program except to the extent that such liabilities are met by the distribution of trust assets.

ARTICLE 7

CHANGE IN CONTROL

7.1

Contributions to Trust

In the event that a Change in Control has occurred, the Company shall be obligated to contribute to a trust (which may include a pre-existing trust established to enable the Company to satisfy its nonqualified benefit obligations) an amount necessary to fund the accrued benefit earned by the Employee under the Program (assuming immediate benefit commencement) determined as of the last day of the calendar month immediately preceding the date the Board determines that a Change in Control has occurred. If the Employee shall not have attained age 55, his annual benefit shall be determined on the same basis used to determine his accrued benefit in the case of death as specified in Section 5.4.

7.2

Amendments

Following a Change in Control of Ingersoll-Rand Company Limited, any amendment modifying or terminating the Program shall have no force or effect.

ARTICLE 8

MISCELLANEOUS

8.1

Amendment and Termination

Except as provided in Section 7.2, the Program may, at any time and from time to time, be amended or terminated without the consent of any Employee or beneficiary, (a) by the Board or the Compensation Committee, or (b) in the case of amendments which do not materially modify the provisions hereof, the Administrative Committee (as described in Section 8.5); provided, however, that no such amendment or termination shall reduce any benefits accrued or vested under the terms of the Program as of the date of termination or amendment.

8.2

No Contract of Employment

The establishment of the Program or any modification hereof shall not give any Employee or other person the right to remain in the service of the Company or any of its subsidiaries, and all Employees and other persons shall remain subject to discharge to the same extent as if the Program had never been adopted.

8.3

Withholding

The Company shall be entitled to withhold from any payment due under the Program any and all taxes of any nature required by any government to be withheld from such payment.

8.4

Loans

No loans to Employees shall be permitted under the Program.

8.5

Compensation Committee

The Program shall be administered by the Compensation Committee (or any successor committee) of the Board. The Compensation Committee has delegated to the members of the administrative committee appointed by the Company’s Chief Executive Officer (the “Administrative Committee”) the authority to administer the Program in accordance with its terms. Subject to review by the Compensation Committee, the Administrative Committee shall make all determinations relating to the right of any person to a benefit under the Program, and unless modified by the Compensation Committee, any determination by the Administrative Committee shall be conclusive and binding upon all affected parties. Any denial by the Administrative Committee of a claim for benefits under the Program by an Employee or beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Employee or beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Employee or beneficiary whose claim for benefits has been denied for a review of the decision denying this claim.

8.6

Entire Agreement; Successors

The Program, including any subsequently adopted amendments, shall constitute the entire agreement or contract between the Company and any Employee regarding the Program. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Employee regarding the provisions of the Program, other than those set forth herein. Notwithstanding the previous sentence, to the extent any written agreement between the Company and an Employee modifies the provisions of the Program with respect to the Employee, such agreement shall be deemed to modify the provisions of the Program but only to the extent such agreement is approved by the Compensation Committee. The Program and any amendment hereof shall be binding on the Company, and the Employees and their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated beneficiaries of the Employee.

8.7

Severability

If any provisions of the Program shall, to any extent, be invalid or unenforceable, the remainder of the Program shall not be affected thereby, and each provision of the Program shall be valid and enforceable to the fullest extent permitted by law.

8.8

Governing Law

Except as preempted by federal law, the laws of the State of New Jersey shall govern the Program.

8.9

Participant as General Creditor

Benefits under the Program shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligations hereunder for payment of benefits at its discretion, provided, however, that no Employee eligible to participate in the Program shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under the Program, such rights shall be no greater than the right of any unsecured general creditor of the Company.

8.10

Nonassignability

To the extent permitted by law, the right of any Employee or any beneficiary in any benefit hereunder shall not be subject to attachment, garnishment, or any other legal or equitable process for the debts of such Employee or beneficiary nor shall any such benefit be subject to anticipation, alienation, sale, transfer, assignment, pledge, or encumbrance.

IN WITNESS WHEREOF, the Company has caused this Program to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

APPENDIX A

The sum of the following benefit offset amount shall be used for purposes of Sections 3.1(b) and 5.1(b) of the Program, irrespective of whether the Employee commences to receive a benefit under any of the plans identified below at the date the Employee’s benefit under the Program is determined:

(a)

All employer-paid benefits under any qualified defined benefit plan (as defined in Code Section 414(j)) and associated supplemental plans (including the Ingersoll-Rand Company Supplemental Pension Plan II) sponsored by the Company. For purposes of this Paragraph (a), the amount of any pension payable under the Clark Equipment Company Retirement Program for Salaried Employees shall be determined without reduction by the lifetime pension equivalent of the Employee’s vested interest in his PPOA Account (as such term is defined in the IR/Clark Leveraged Employee Stock Ownership Plan).

The Employee’s benefit, if any, under any qualified defined benefit plan and associated supplemental plans described in the previous paragraph, shall be determined as a life annuity based on the Employee’s credited period of service under such plan through the date of the Employee’s Separation from Service, converted to a lump sum in accordance with the factors used to determine lump sum distributions under such plan(s) or, if lump sum distributions are not available under such plan(s), as the lump sum Actuarial Equivalent of the accrued and vested benefits under such plan(s).

(b)

The Social Security Primary Insurance Amount (as defined below) estimated at age 65, multiplied by a fraction, the numerator of which is his Years of Service (up to a maximum of 35 Years of Service), and the denominator of which is 35.

For purposes of the Program, “Social Security Primary Insurance Amount” means the amount of the Employee’s annual primary old age insurance determined under the Social Security Act in effect at the date of determination and payable in accordance with (i) or (ii) below.

(i)

For benefits determined on or after age 65, payable for the year following his date of retirement.

(ii)

For benefits determined before the Employee attains age 65, payable for the year following his retirement or death (or which would be payable when he first would have become eligible if he were then unemployed), assuming he will not receive after retirement (or death) any income that would be treated as wages for purposes of the Social Security Act.

For purposes of determining the Social Security Benefit under paragraphs (i) and (ii) above, an Employee’s covered earnings under said Act for each calendar year preceding the Employee’s first full calendar year of employment shall be determined by multiplying his covered earnings subsequent to the year being determined by the ratio of the average per worker total wages as reported by the Social Security Administration for the calendar year being determined to such average for the calendar year subsequent to the year being determined.

The “Social Security Primary Insurance Amount” determined above shall be converted to a lump sum that is the Actuarial Equivalent of such benefit.

(c)

An Employee’s accrued benefit under any qualified defined benefit pension plan (as defined in Code Section 414(j)) and any nonqualified pension plan with respect to any business that was acquired by the Company or any of its affiliates (“Acquired Business”) in respect of any period of service with the Acquired Business that is counted as a Year of Service under the Program. Each such pension plan, including but not limited to the Ingersoll Rand Company/Thermo King Executive Pension Plan, the Hussmann Corporation Supplemental Executive Retirement Plan, and the Trane Inc. Executive Supplemental Retirement Benefit Program, is referred to herein as a “Former Plan.” The Employee’s accrued benefit under the Former Plan shall be determined as a life annuity payable as of the date of determination, using the Former Plan’s early retirement factors, if applicable, and converted to a lump sum based on the factors used to determine lump sum distributions under the Former Plan or, if lump sum distributions are not available under the Former Plan, as the lump sum Actuarial Equivalent of the benefits accrued under the Former Plan.

(d)

Any and all benefits accrued or accumulated by the Employee under any Foreign Plan (as defined in Section 1.12 of the Program) in respect of any period of service with a foreign Employer that is counted as a Year of Service under the Program, excluding any benefit attributable to the Employee’s own contributions (whether voluntary or mandatory) under any Foreign Plan. Such benefits shall be converted to a lump sum based on the factors used to determine lump sum distributions under such plan(s) or, if lump sum distributions are not available under such plan(s), as the lump sum Actuarial Equivalent of the benefits accrued under such plan(s).

Exhibit 10.37

February 4, 2009

Mr. Herb Henkel

28881 Girard Terrace

Naples, FL 34110


RE:		Ingersoll-Rand Company
		Elected Officers Supplemental Program II

Dear Mr. Herb:

In furtherance of the approvals from the Board of Directors of Ingersoll-Rand Company Limited (“Board”) and the Compensation Committee of the Board (“Compensation Committee”) during their meetings held on February 4, 2009, and pursuant to Sections 8.1 and 8.6 of the Ingersoll-Rand Company Elected Officer Supplemental Program II (“Plan”), the Board and the Compensation Committee hereby amend the Plan with respect to your benefits thereunder to provide that, notwithstanding any other provision of the Plan, the interest rate that shall be used for purposes of determining the “Actuarial Equivalent” lump sum amount of your benefit under Section 3.1(a) of the Plan shall be the interest rate specified in Section 1.1 of the Plan that would have been used if you had retired in February 2009. The effect of this amendment is to assure that your benefit under the Plan will not be increased or decreased by reason of interest rate changes between now and the actual date of your retirement.

All benefits payable under the Plan, including any additional benefit payable to you as a result of this amendment to the Plan, will be subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended. This amendment will not affect the amount of the benefit payable to you under the Ingersoll-Rand Company Elected Officer Program (EOSP I), which is not subject to Section 409A. The frozen EOSP I benefit will offset the benefit payable to you under the Plan.

Very truly yours,

/s/ Patricia Nachtigal

Patricia Nachtigal

Senior Vice President and General Counsel


cc:		Marcia Avedon
		Jeff Blair


Accepted:

/s/ Herbert Henkel				02/19/09
Herbert Henkel				Date

Exhibit 10.43

February 4, 2009

Mr. Michael Lamach

107 Eastham Court

Mooresville, NC 28117

Dear Mike,

Congratulations on your promotion to President and Chief Operating Officer. This position will be located in Davidson, North Carolina. The following is an addendum to the terms of your offer letter dated December 24, 2003 as well as to the addendum stated in your June 4, 2008 letter. The following summarizes your compensation and benefits in this new role.

Your starting salary will be at an annual rate of $700,000 (seven hundred thousand U.S. dollars) paid monthly. This will be effective February 1, 2009.

Your Annual Incentive Matrix (“AIM”) target opportunity will increase from 90% to 110% of base salary. The actual AIM award paid is dependent on your performance and the performance of Ingersoll-Rand Company Limited. For fiscal year 2009, this award will be determined based on performance against pre-established financial objectives for the Corporation as well as your own individual performance.

Your annual stock option / Restricted Stock Unit (“RSU”) award target opportunity (to be granted in February 2010) has been increased to a fixed value of $900,000. Annual stock option awards are contingent on your sustained performance and demonstrated leadership potential and may vary from the target award opportunity. Your February 2009 stock option / RSU grant will be 115% of your base salary in effect as of December 31, 2008.

You will receive a one-time special grant of 50,000 stock options. The stock options will vest 100% on February 12, 2012 and have an exercise price equal to the fair market value on February 12, 2009, the date the Compensation Committee officially approves this award.

Your Performance Share award target opportunity has been increased to a fixed value of $900,000 beginning with the performance period of January 1, 2009 to December 31, 2011 as well as for your stub-award for the performance period of January 1, 2009 to December 31, 2010. As discussed previously, the target number of shares is determined based on the fair market value on the date the Committee approves the award each February and the shares actually paid out at the end of the performance period is based on Ingersoll Rand’s Earnings per

Share (“EPS”) from continuing operations relative to S&P Industrial peers. In addition, the stub award will be based on relative EPS performance to that of S&P Industrial peers and performance against certain synergy goals.

The terms of your Change-in-Control agreement will be consistent with those provided to the Company’s other Tier 1 Officers, which include the Chief Executive Officer, the Chief Financial Officer and the General Counsel.

Your share ownership guideline will increase from 40,000 to 75,000 shares pursuant to the policy established for the Chief Operating Officer position.

Mike, congratulations again on your promotion and I wish you much success in your new role. If you have any questions regarding the changes in your compensation and benefits, please contact Jeff Blair, Vice President, Total Rewards (732-980-3082).

Sincerely,

/s/ Herbert L. Henkel

Herbert L. Henkel

Chairman, President and Chief Executive Officer


cc:		Marcia Avedon
		Jeff Blair

Exhibit 10.51

IR-LIMITED DIRECTOR DEFERRED COMPENSATION

AND STOCK AWARD PLAN

[As Amended and Restated Effective January 1, 2009]

TABLE OF CONTENTS


SECTION 1 - STATEMENT OF PURPOSE		1

SECTION 2 - DEFINITIONS

2.1 Account Balance		1
2.2 Beneficiary		2
2.3 Beneficiary Designation Form		2
2.4 Board		2
2.5 Conversion Account		2
2.6 Deferral Account		2
2.7 Deferral Amount		2
2.8 Deferred IR Stock Award Account		2
2.9. Effective Time		2
2.10 Election Form		2
2.11 Fees		2
2.12 Investment Option Subaccounts		2
2.13 IR Stock		3
2.14 IR Stock Account		3
2.15 Merger Agreement		3
2.16 Participant		3
2.17 Plan Year		3
2.18 Retirement		3
2.19 Return		3
2.20 Supplemental Contribution		3
2.21 Supplemental Contribution Account		3
2.22 Trust		3

SECTION 3 - PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

3.1 Participation and Deferral Election		4
3.2 Investment Election		4

SECTION 4 - VESTING

4.1 Deferral Amounts		5
4.2 Supplemental Contributions		5
4.3 Conversion Account		5
4.4 Deferred IR Stock Award Account		5


SECTION 5 - ACCOUNTS AND VALUATIONS

5.1 Deferral Accounts		5
5.2 Supplemental Contribution Accounts		6
5.3 IR Stock Accounts		6
5.4 Deferred IR Stock Award Amount		7
5.5 Deferred Amounts upon Termination of the Retirement Plan		8
5.6 Conversion of Deferred Compensation Account Balances		8
5.7 Valuation of Account Balance in Event of Change in Control		8
5.8 Changes in Capitalization		9
5.9 Accounts are Bookkeeping Entries		9
5.10 Mandatory Fee Deferral		9

SECTION 6 - DISTRIBUTION OF ACCOUNTS

6.1 Termination, Retirement and Death		10
6.2 Scheduled Distributions		11
6.3 Form of Payments		12
6.4 Change in Control		12
6.5 Taxes; Withholding		14

SECTION 7 - BENEFICIARY DESIGNATION		14

SECTION 8 - AMENDMENT AND TERMINATION OF PLAN

8.1 Amendment		15
8.2 Termination of Plan		15

SECTION 9 - MISCELLANEOUS

9.1 Unsecured General Creditor		15
9.2 Entire Agreement; Successors		16
9.3 Non-Assignability		16
9.4 Authorization and Source of Shares		16
9.5 Singular and Plural		16
9.6 Captions		16
9.7 Applicable Law		16
9.8 Severability		16

IR-Limited Director Deferred Compensation and Stock Award Plan

As Amended and Restated Effective January 1, 2009

SECTION 1

STATEMENT OF PURPOSE

The purpose of the IR-Limited Director Deferred Compensation and Stock Award Plan (the “Plan”) is to further increase the mutuality of interest between Ingersoll-Rand Company Limited, a Bermuda company (the “Company”), its non-employee members of the Board (“Non-employee Directors”) and members by providing its Non-employee Directors the opportunity to elect to defer receipt of cash compensation. The Plan, originally known as the Ingersoll-Rand Company Directors Deferred Compensation and Stock Award Plan, became effective on January 1, 1997, was amended and restated effective January 1, 2001, was subsequently amended as of December 21, 2001, and was again amended and restated effective August 1, 2007. This further amendment and restatement is effective January 1, 2009.

Notwithstanding any other provision of the Plan to the contrary (including any election made by any Participant under the Plan), (i) no amount shall be deferred under the Plan if, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004, Q&A-16 of IRS Notice 2005-1, and Treasury Regulations section 1.409A-6(a), such amount would be subject to Section 409A of the Internal Revenue Code of 1986, as amended (a “Non-Grandfathered New Deferral Amount”), and (ii) any amount previously deferred under the Plan that, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004, Q&A-16 of IRS Notice 2005-1, and Treasury Regulations section 1.409A-6(a), is subject to Section 409A of the Internal Revenue Code of 1986, as amended (a “Non-Grandfathered Prior Deferral Amount”) shall no longer be credited or payable under the Plan after December 31, 2004. Any Non-Grandfathered New Deferral Amount shall instead be deferred under the IR-Limited Director Deferred Compensation and Stock Award Plan II, and any Non-Grandfathered Prior Deferral Amount shall instead be credited under the IR-Limited Director Deferred Compensation and Stock Award Plan II, as and to the extent provided under the terms of IR-Limited Director Deferred Compensation and Stock Award Plan II.

SECTION 2

DEFINITIONS

2.1

“Account Balance ” means, for each Plan Year, a credit on the records of the Company equal to the sum of the value of a Participant’s Conversion Account, Deferral Account, Deferred IR Stock Award Account, Supplemental Contribution Account and IR Stock Account for such Plan Year. The Account Balance shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or to the Participant’s designated Beneficiary, pursuant to the Plan.

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2.2	“Beneficiary” means the person or persons designated as such in accordance with Section 7.

2.3	“Beneficiary Designation Form” means the form established from time to time by the Company that a Participant completes and returns to the Secretary of the Company to designate one or more Beneficiaries.

2.4	“Board” means the Board of Directors of the Company.

2.5	“Conversion Account” means the sum of all of the shares of IR Stock credited to a Participant pursuant to Section 5.6.

2.6

“Deferral Account” means, for each Plan Year, (i) the sum of all of a Participant’s Deferral Amounts (other than amounts deferred pursuant to Section 5.10), plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s Deferral Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s Deferral Account.

2.7	“Deferral Amount” means the amount of Fees actually deferred under the Plan by the Participant pursuant to Section 3.1 and the amount of Fees automatically deferred pursuant to Section 5.10 for any one Plan Year.

2.8	“Deferred IR Stock Award Account” means, for each Plan Year, the sum of all of a Participant’s deferred stock award amounts pursuant to Section 5.4, deferred amounts upon termination of the retirement plan pursuant to Section 5.5 and deferred amounts pursuant to Section 5.10.

2.9	“Effective Time” means the Effective Time as such term is defined in the Merger Agreement.

2.10

“Election Form” means the form or forms established from time to time by the Company that a Participant completes, signs and returns to the Secretary of the Company to make an election under the Plan. An Election Form also includes any other method approved by the Company that a Participant may use to make an election under the Plan. The terms and conditions specified in the Election Form(s) are incorporated by reference herein and form a part of the Plan. If there is a conflict between the Election Form and the Plan, the terms of the Plan shall control and govern.

2.11	“Fees” means retainer and meeting fees payable to Non-employee Directors.

2.12	“Investment Option Subaccounts” means the separate subaccounts, each of which corresponds to an investment option elected by the Participant with respect to a Participant’s Deferral Accounts.

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2.13	“IR Stock ” means the Class A common shares, par value $1.00 per share, of the Company.

2.14

“IR Stock Account” means, for each Plan Year, (i) the sum of all of a Participant’s Deferral Amounts that are deemed to be invested in IR Stock, plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s IR Stock Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s IR Stock Account.

2.15

“Merger Agreement” means that certain Agreement and Plan of Merger among Ingersoll-Rand Company, Ingersoll-Rand Company Limited, and IR Merger Corporation dated as of October 31, 2001, pursuant to which Ingersoll-Rand Company became an indirect wholly-owned subsidiary of Ingersoll-Rand Company Limited.

2.16	“Participant” means a Non-employee Director participating in the Plan in accordance with the provisions of Section 3.

2.17	“Plan Year” means a calendar year.

2.18	“Retirement ” means retirement in accordance with the Board’s retirement policy for Non-employee Directors.

2.19	“Return” means, for each investment option, an amount equal to the net investment return (including changes in value and distributions) for each such investment option during each business day.

2.20

2.21

“Supplemental Contribution Account” means, for each Plan Year, (i) the sum of all of a Participant’s Supplemental Contributions, plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s Supplemental Contribution Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s Supplemental Contribution Account.

2.22	“Trust” means the Ingersoll-Rand Company Deferred Compensation Trust Agreement, dated as of January 1, 2001 between the Company and the trustee named therein, as amended from time to time.

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SECTION 3

PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

3.1

Participation and Deferral Election . Non-employee Directors may elect to participate in the Plan for a given Plan Year by filing a completed Election Form for the Plan Year in the manner prescribed by the Secretary of the Company. The Election Form must specify the percentage or dollar amount of any Deferral Amount otherwise payable during such Plan Year that will be deferred under the Plan. Notwithstanding anything to the contrary, at the Non-employee Director’s direction, an election to participate in the Plan for a given Plan Year may continue from Plan Year to Plan Year unless a written request to modify or terminate that election for a subsequent period is submitted to the Secretary of the Company on or before the date 15 days prior to the beginning of the subsequent Plan Year. Any election to defer a Deferral Amount is irrevocable upon the filing of the Election Form, and must be properly completed and filed no later than the November 30 immediately preceding such Plan Year, or, with respect to a new Non-employee Director, before the effective date of his or her election to the Board, or such other date as the Secretary of the Company may specify. A Non-employee Director who fails to file a properly completed Election Form by such date will be ineligible to defer a Deferral Amount under the Plan for the following Plan Year. In addition, the Company may establish from time to time such other enrollment requirements as it determines are necessary or proper.

If the Company determines in good faith that a Participant no longer qualifies as a Non-employee Director, the Company shall have the right to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which the Participant’s membership status changes, (ii) prevent the Participant from making future deferral elections and/or (iii) immediately distribute the Participant’s then vested Account Balances and terminate the Participant’s participation in the Plan.

3.2

Investment Election . In accordance with procedures established by the Company, prior to the time a Participant’s Deferral Amounts are credited to a Participant’s Deferral Account pursuant to Section 5.1, the Participant shall designate, on an Election Form, the types of investment options in which the Participant’s Deferral Amounts will be deemed to be invested for purposes of determining the amount of earnings to be credited to the Participant’s Deferral Account and, with respect to Deferral Amounts that are designated by the Participant to be deemed to be invested in IR Stock, the IR Stock Account.

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Subject to Section 5.3, in making the designations pursuant to this Section, the Participant may specify that all or any portion of the Participant’s Deferral Amount be deemed to be invested, in whole percentage increments, in one or more of the types of investment options provided under the Plan. A Participant may change the designation made under this Section with respect to prior and/or future Deferral Amounts by filing an Election Form no later than the time specified by the Secretary of the Company, to be effective as of the first business day of the following month. If a Participant fails to elect a type of investment option under this Section, he or she shall be deemed to have elected the investment option designated by the Company as the default investment option.

SECTION 4

VESTING

4.1	Deferral Amounts . A Participant shall be fully vested in his or her Deferral Account.

4.2

Supplemental Contributions . A Participant shall vest in his or her Supplemental Contribution Account on the earliest of: (i) the fifth anniversary of the date the Supplemental Contribution is credited to the Participant’s Supplemental Contribution Account; (ii) the date of the Participant’s cessation of service on the Board by reason of Retirement or death; (iii) a Change in Control pursuant to Section 6.4; or (iv) a termination of the Plan pursuant to Section 8.2.

4.3	Conversion Account . A Participant shall be fully vested in his or her Conversion Account.

4.4	Deferred IR Stock Award Account . A Participant shall be fully vested in his or her Deferred IR Stock Award Account.

SECTION 5

ACCOUNTS AND VALUATIONS

5.1

Deferral Accounts . The Company shall establish and maintain a separate Deferral Account for each Participant for each Plan Year. All Deferral Amounts, other than Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s Deferral Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account as described in Section 5.3.

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Each Participant’s Deferral Accounts shall be divided into Investment Option Subaccounts. A Participant’s Deferral Accounts shall be credited as follows:

On the day a Deferral Amount is credited to a Participant’s Deferral Account, the Administrative Committee shall credit the Investment Option Subaccounts of the Participant’s Deferral Account with an amount equal to the Participant’s Deferral Amount in accordance with the Participant’s Election Form; that is, the portion of the Participant’s Deferral Amount that the Participant has elected to be deemed to be invested in a certain type of investment option shall be credited to the Investment Option Subaccount corresponding to that investment option, and

Each business day, each Investment Option Subaccount of a Participant’s Deferral Account shall be adjusted for earnings or losses in an amount equal to that determined by multiplying the balance credited to such Investment Option Subaccount as of the prior day plus contributions credited that day to the Investment Option Subaccount by the Return for the corresponding investment option selected by the Company.

5.2

Supplemental Contribution Accounts . The Company shall establish and maintain a separate Supplemental Contribution Account for each Plan Year for each Participant who receives a Supplemental Contribution for such Plan Year. All Supplemental Contributions shall be credited to the Participant’s Supplemental Contribution Account on the same date that the Participant’s Deferral Amount for which the Supplemental Contribution is being made is credited to the Participant’s Deferral Account pursuant to Section 5.1. All of a Participant’s Supplemental Contributions shall be deemed to be invested in, and shall remain deemed to be invested in, IR Stock in the Participant’s Supplemental Contribution Account until such amounts are distributed from the Plan.

All Supplemental Contributions shall initially be credited to a Participant’s Supplemental Contribution Account in units or fractional units of IR Stock. The value of each unit shall be determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Supplemental Contributions are credited to a Participant’s Supplemental Contribution Account, the number of units to be credited shall be determined by dividing the number of units by the value of a unit on such date.

Dividends paid on IR Stock shall be reflected in a Participant’s Supplemental Contribution Account by the crediting of additional units or fractional units. Such additional units or fractional units shall equal the value of the dividends based upon the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape on the date such dividends are paid.

5.3

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when the Deferral Amount would otherwise be paid to the Participant. Notwithstanding anything to the contrary, IR Stock credited to a Participant’s IR Stock Account may not be designated by the Participant to be deemed to be invested in any other investment option and shall remain invested in IR Stock in such IR Stock Account until distributed from the Plan. A Participant’s IR Stock Accounts shall be credited as follows:

(a)

On the day a Deferral Amount is credited to a Participant’s IR Stock Account, the Company shall credit the IR Stock Account with an amount equal to the Participant’s Deferral Amount.

(b)

All Deferral Amounts deemed to be invested in IR Stock in accordance with the Participant’s Election Form shall be credited to a Participant’s IR Stock Account in units or fractional units. The value of each unit shall be determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Deferral Amounts are credited to the Participant’s IR Stock Account, the number of units to be credited shall be determined by dividing the amount of such Deferral Amounts by the value of a unit on such date.

Dividends paid on IR Stock shall be reflected in a Participant’s IR Stock Account by the crediting of additional units or fractional units. Such additional units or fractional units shall equal the value of the dividends based upon the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape on the date such dividends are paid.

5.4

Deferred IR Stock Award Amount . For periods before July 1, 2003, each Non-employee Director shall receive an annual award on the date of the first Board meeting after each annual meeting of shareholders in the form of a promise by the Company to deliver 600 shares of IR Stock, or such other amount as may from time to time be established by resolution of the Board. Annual awards of shares of IR Stock shall be credited to the Deferred IR Stock Award Account of each Non-employee Director.

A Participant’s Deferred IR Stock Award Accounts shall be credited as follows:

(a)

On the day an annual award of IR Stock is credited to a Participant’s Deferred IR Stock Award Account, the Company shall credit the Deferred IR Stock Award Account with an amount equal to the Participant’s annual award of IR Stock.

(b)

All awards of IR Stock pursuant to this Section and amounts credited pursuant to Section 5.5 shall be credited to a Participant’s Deferred IR Stock Award Account in units or fractional units. The value of each unit shall be determined each business day and shall equal the closing price of

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one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that awards of IR Stock are credited to the Participant’s Deferred IR Stock Award Account, the number of units to be credited shall be determined by dividing the amount of such IR Stock awarded by the value of a unit on such date.

Dividends paid on IR Stock shall be reflected in a Participant’s Deferred IR Stock Award Account by the crediting of additional units or fractional units. Such additional units or fractional units shall equal the value of the dividends based upon the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape on the date such dividends are paid.

5.5

Deferred Amounts upon Termination of the Retirement Plan . The shares of IR Stock credited to the deferred compensation accounts (such crediting having occurred prior to the Plan’s amendment and restatement effective January 1, 2001) of the Non-employee Directors pursuant to the resolutions adopted by the Board on November 6, 1996, with respect to the elimination of retirement payments to Non-employee Directors shall be credited to the Deferred IR Stock Award Account of each Non-Employee Director as of January 1, 2001.

5.6

Conversion of Deferred Compensation Account Balances. A Non-employee Director’s cash balance in the deferred compensation program as of December 31, 1996 was transferred to an equivalent balance in the Plan as of January 1, 1997. Such balance was equal to the number of shares of IR Stock, including fractions, which could have been purchased with such cash account balance on January 2, 1997 at the mean of the high and low prices of a share of IR Stock on the New York Stock Exchange – Composite Tape on such date, provided that if no sales of shares of IR Stock were made on the New York Stock Exchange on that date, the mean of the high and low prices reported for the preceding day on which sales of shares of IR Stock were made on the New York Stock Exchange.

A Non-employee Director’s balance, as such balance is described in the previous paragraph, shall be credited to the Non-employee Director’s Conversion Account as of January 1, 2001 in units or fractional units. The value of each unit shall be determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape.

Dividends paid on IR Stock shall be reflected in a Non-employee Director’s Conversion Account by the crediting of additional units or fractional units. Such additional units or fractional units shall equal the value of the dividends based upon the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape on the date such dividends are paid.

5.7	Valuation of Account Balance in Event of Change in Control . In the event of a Change in Control pursuant to Section 6.4, the value of each IR Stock unit deemed to be invested in each IR Stock Account, Supplemental Contribution

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Account, Conversion Account and Deferred IR Stock Award Account shall be equal to the highest Fair Market Value (as such term is defined in the Company’s Incentive Stock Plan of 1998) of one share of IR Stock during the 60 days preceding the date on which the Change in Control occurs.

In the event of a Change in Control pursuant to Section 6.4, the value of a Participant’s Account Balances for all investment options other than IR Stock shall be determined as of the end of the month during which the Change in Control occurs.

5.8

Changes in Capitalization . If there is any change in the number or class of shares of IR Stock through the declaration of a stock dividend or other extraordinary dividends, or recapitalization resulting in stock splits, or combinations or exchanges of such shares or in the event of similar corporate transactions, the units in each Participant’s IR Stock Account, Supplemental Contribution Account, Conversion Account and Deferred IR Stock Award Account shall be equitably adjusted to reflect any such change in the number or class of issued shares of IR Stock or to reflect such similar corporate transaction.

5.9

Accounts are Bookkeeping Entries . Notwithstanding any other provision of the Plan that may be interpreted to the contrary, the investment options, including IR Stock, are to be used for measurement purposes only, and a Participant’s election of any such investment option, the allocation to his or her Account Balances thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balances shall not be considered or construed in any manner as an actual investment in any such investment option. In the event that the Company or the trustee of the Trust, in its own discretion, decides to invest funds in any or all of the investment options, no Participant shall have any rights in or to such investments themselves. Without limiting the foregoing, a Participant’s Account Balances shall at all times be a bookkeeping entry only and shall not represent any investment made on the Participant’s behalf by the Company or the Trust. The Participant shall at all times remain an unsecured creditor of the Company.

5.10

Mandatory Fee Deferral . Effective July 1, 2003, on each IR Stock quarterly dividend payment date a portion of each Non-employee Director’s Fees equal to $15,000, or such other amount as may from time to time be established by resolution of the Board, shall be deferred and credited to the Deferred IR Stock Award Account of each Non-employee Director.

A Participant’s Deferred IR Stock Award Accounts shall be credited as follows:

(a)

On the day the Fees are credited to a Participant’s Deferred IR Stock Award Account, the Company shall credit the Deferred IR Stock Award Account with an amount equal to the Fees that are deferred pursuant to this Section.

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(b)

All Fees that are deferred pursuant to this Section shall be credited to a Participant’s Deferred IR Stock Award Account in units or fractional units. The value of each unit shall be determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Fees under this Section are credited to the Participant’s Deferred IR Stock Award Account, the number of units to be credited shall be determined by dividing the amount of such Fees by the value of a unit on such date.

SECTION 6

DISTRIBUTION OF ACCOUNTS

6.1

Termination, Retirement and Death . A Participant who terminates as a member of the Board, reaches Retirement or dies shall be paid his or her vested Account Balances (and after his or her death to his or her Beneficiary) in annual installments over ten (10) years beginning as soon as administratively practicable in the year following the Participant’s termination, Retirement or death unless an optional form of benefit payment is elected in accordance with the next sentence. For each Plan Year’s Account Balance the Participant may elect an optional form of benefit payment from among the following:

A lump sum distribution to be paid as soon as administratively practicable in the year following the Participant’s termination, Retirement or death;

Annual installments over five (5) years commencing as soon as administratively practicable in the year following the Participant’s termination, Retirement or death;

Annual installments over fifteen (15) years commencing as soon as administratively practicable in the year following the Participant’s termination, Retirement or death; and

A lump sum distribution which shall be paid as soon as administratively practicable in the year specified by the Participant on the Election Form. Such specified time shall be no less than one (1) year and no more than five (5) years following termination, Retirement or death.

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A Participant may elect, on an Election Form, to change the form and/or extend the timing of a distribution under this Section that he or she has previously elected to any other form of distribution or time permitted under this Section, provided that no such election shall be effective unless it is made at least one (1) year before the Participant’s termination, Retirement or death, as applicable.

In the event of the Participant’s termination, Retirement or death prior to the elected date for one or more scheduled distributions pursuant to Section 6.2, the portion of the Participant’s Account Balance associated with such distribution(s) shall be paid to the Participant (and after his or her death to his or her Beneficiary) in the same form as elected by the Participant under this Section.

Notwithstanding any provision of the Plan to the contrary, if a Participant terminates, has reached Retirement or dies while receiving annual installments pursuant to Section 6.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not terminated employment, reached Retirement or died.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Account Balances.

6.2

Scheduled Distributions . A Participant may elect, on an Election Form, to receive a distribution of all or a portion of his or her Deferral Account and IR Stock Account with respect to a Plan Year(s) while still a Non-employee Director. A Participant’s election for a distribution under this Section shall be permitted only if the distribution date has been specified on an original Election Form timely filed by the Participant under Section 3.1, and such distribution date (in the event of a lump sum) or the date of commencement of such distribution (in the event of annual installments) is no earlier than two (2) years from the last day of the Plan Year for which the portion of the Deferral Account and IR Stock Account to be distributed was actually deferred. A Participant may elect, on an Election Form, to extend the date for any distribution under this Section with respect to any Plan Year, provided such election occurs at least one year before the date of distribution most recently elected for that Plan Year by the Participant and the extension is for a period of not less than two (2) years after the date of distribution most recently elected for that Plan Year by the Participant. The Participant shall have the right to extend the date for any distribution under this Section for a Plan Year twice.

At the time an election for a distribution under this Section is made, the Participant shall also elect, on the Election Form, the form of payment of the distribution. The Participant shall elect either (i) a lump sum payment to be paid as soon as soon as administratively practicable in the year specified by the Participant on the Election Form or (ii) annual installments over two (2), three (3), four (4) or five (5) years beginning as soon as administratively practicable in the year specified by the Participant on the Election Form.

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A Participant may elect, on an Election Form, to change the form of payment for any distribution under this Section for any Plan Year to any other form of payment permitted under this Section, provided such election occurs at least one (1) year before the date of distribution previously elected by the Participant.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Deferral Account(s) and IR Stock Account(s), as applicable.

6.3

Form of Payments . All amounts in a Participant’s Deferral Account and payable to a Participant or Beneficiary under the Plan shall be paid in cash. All amounts in a Participant’s Conversion Account, Supplemental Contribution Account, Deferred IR Stock Award Account, and IR Stock Account and payable to a Participant or Beneficiary under the Plan shall be paid in IR Stock; except that, with respect to any fractional share, such fractional share shall be paid in cash.

All distributions from the Plan that are to be paid in a specified number of annual installments shall be paid so that the amount of each annual installment is determined by dividing the total remaining number of units in the Participant’s Account Balance to be paid in annual installments by the number of years of annual installments remaining.

6.4	Change in Control . In the event of a Change in Control, as defined in this Section, all Account Balances shall be valued pursuant to Section 5.7, and shall be distributed in a lump sum within forty five (45) days following the Change in Control.

For purposes hereof,

(1) “Affiliate” shall mean, when used to indicate a relationship with a specified person, a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such specified person.

(2) “Associate” shall mean, when used to indicate a relationship with a specified person, (a) any corporation, partnership, or other organization of which such specified person is an officer or partner, (b) any trust or other estate in which such specified person has a substantial beneficial interest or as to which such specified person serves as trustee or in a similar fiduciary capacity, (c) any relative or spouse of such specified person, or any relative of such spouse who has the same home as such specified person, or who is a Director or officer of the Company or any of its parents or subsidiaries, and (d) any person who is a director, officer, or partner of such specified person or of any corporation (other than the Company or any wholly-owned subsidiary of the Company), partnership or other entity which is an Affiliate of such specified person.

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(3) “Beneficial Owner” shall have the same meaning as such term is defined by Rule 13d-3 under the Securities Exchange Act of 1934 (or any successor provision at the time in effect); provided, however, that any individual, corporation, partnership, group, association, or other person or entity which has the right to acquire any of the Company’s outstanding securities entitled to vote generally in the election of directors at any time in the future, whether such right is contingent or absolute, pursuant to any agreement, arrangement, or understanding or upon exercise of conversion rights, warrants or options, or otherwise, shall be deemed the Beneficial Owner of such securities.

(4) “Change in Control” shall mean the occurrence of either of the following:

(a) any individual, corporation, partnership, group, association or other person or entity, together with its Affiliates and Associates (other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company), is or becomes the Beneficial Owner of securities of the Company representing 20 percent or more of the combined voting power of the Company’s then outstanding securities entitled to vote generally in the election of directors, unless a majority of the Continuing Directors determines in their sole discretion that, for purposes of this Plan, a Change in Control has not occurred;

(b) the Continuing Directors shall at any time fail to constitute a majority of the members of the Board; or

(c) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company, other than any sale, lease, exchange or other transfer to any person or entity where the Company owns, directly or indirectly, at least 80 percent of the outstanding voting securities of such person or entity after any such transfer.

(d) Notwithstanding any provision of this Section 6.4 or any other provision of the Plan to the contrary, none of the transactions contemplated by the Merger Agreement which are undertaken by (i) Ingersoll-Rand Company or its affiliates prior to or as of the Effective Time or (ii) Ingersoll-Rand Company Limited or its affiliates on or after the Effective Time shall trigger, constitute or be deemed a Change in Control.

(5) “Continuing Director” shall mean a Director who either was a member of the Board on April 24, 1998 or who became a member of the Board subsequent to such date and whose election, or nomination for election by the Company’s shareholders, was Duly Approved by the Continuing Directors of the Board at the time of such nomination or election, either by a specific vote or by approval of the proxy statement issued by the Company on behalf of the Board in which such

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person is named as a nominee for Director, provided, however, that no individual shall be considered a Continuing Director if such individual initially assumed office as a result of either an actual or threatened “Election Contest” (as described in Rule 14a-11 promulgated under the Securities Exchange Act of 1934, as amended) or other actual or threatened solicitation of proxies or consents other than by or on behalf of the Board (a “Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest.

(6) “Duly Approved by the Continuing Directors” shall mean an action approved by the vote of at least a majority of the Continuing Directors then on the Board, except, if the votes of such Continuing Directors in favor of such action would be insufficient to constitute an act of the Board if a vote by all of its members were to have been taken, then such term shall mean an action approved by the unanimous vote of the Continuing Directors then on the Board so long as there are at least three Continuing Directors on the Board at the time of such unanimous vote.

6.5

Taxes; Withholding . To the extent required by law, the Company, or the trustee of the Trust, shall withhold from payments made hereunder an amount equal to at least the minimum taxes required to be withheld by the federal or any state or local government. The amount to be withheld and the manner in which amounts shall be withheld shall be determined in the sole discretion of the Company or the trustee of the Trust.

SECTION 7

BENEFICIARY DESIGNATION

A Participant shall have the right to designate a Beneficiary(ies) to receive the Participant’s Account Balances in the event the Participant dies prior to receiving all of his or her Account Balances. A Beneficiary designation shall be made, and may be amended at any time, by the Participant by filing a written designation with the Secretary of the Company, on such form and in accordance with such procedures as the Company shall establish from time to time. A Participant may change the designated Beneficiary under this Plan at any time by providing such designation in writing to the Secretary of the Company.

If a Participant fails to designate a Beneficiary(ies), or if all designated Beneficiaries predecease the Participant, the Participant’s Beneficiary(ies) shall be deemed to be the Participant’s estate. If the Company is unable to determine a Participant’s Beneficiary or if any dispute arises concerning a Participant’s Beneficiary, the Company may pay benefits to the Participant’s estate. Upon such payment, the Company shall have no further liability hereunder.

If any distribution to a Beneficiary is to be made in annual installments, and the Beneficiary dies before receiving all such installments, the value of the remaining installments, if any, shall be paid to the estate of the Beneficiary in a lump sum.

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SECTION 8

AMENDMENT AND TERMINATION OF PLAN

8.1

Amendment. The Plan may, at any time and from time to time, be amended without the consent of any Participant or Beneficiary, by the Board (or an authorized Committee of the Board); provided, however, that no amendment shall reduce any benefits accrued under the terms of the Plan prior to the date of amendment.

8.2	Termination of Plan

Company’s Right to Terminate . The Board (or an authorized Committee of the Board) may terminate the Plan at any time and for any reason.

Payments Upon Termination. Upon any termination of the Plan under this Section, Fees, Supplemental Contributions and stock awards pursuant to Section 5.4 shall prospectively cease to be deferred and, with respect to all such amounts previously deferred, the Company shall pay to the Participant, in a lump sum, unless otherwise provided by the Board at the time of termination, as soon as administratively practicable, the value of the Participant’s Account Balances.

SECTION 9

MISCELLANEOUS

9.1

Unsecured General Creditor . Benefits under the Plan shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligations hereunder for payment of benefits at its discretion, provided, however, that no Participant or Beneficiary shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under this Plan, such rights shall be no greater than the right of any unsecured general creditor of the Company. No Participant shall have any of the rights or privileges of a stockholder of the Company under the Plan, including as a result of the crediting of units to the Participant’s IR Stock Account, Supplemental Contribution Account, Conversion Account or Deferred IR Stock Award Account, except at such time as distribution is actually made from the Participant’s IR Stock Account, Supplemental Contribution Account, Conversion Account or Deferred IR Stock Award Account, as applicable.

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9.2

Entire Agreement; Successors . The Plan, including the Election Form and any subsequently adopted amendments to the Plan or Election Form, shall constitute the entire agreement or contract between the Company and any Participant regarding this Plan. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Participant relating to the subject, matter hereof, other than those set forth herein. This Plan and any amendment hereof shall be binding on the Company and the Participants and, their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated Beneficiaries of the Participant.

9.3

Non-Assignability . To the extent permitted by law, the right of any Participant or any Beneficiary in any benefit hereunder shall not be subject to attachment or any other legal process for the debts of such Participant or Beneficiary; nor shall any such benefit be subject to anticipation, alienation, sale, transfer, assignment or encumbrance.

9.4

Authorization and Source of Shares . Shares of IR Stock necessary to meet the obligations of the Plan have been reserved and authorized pursuant to resolutions adopted by the Board on December 4, 1996, and additional shares of IR Stock shall be reserved and authorized for delivery under the Plan from time to time. These shares of IR Stock may be provided from newly-issued or treasury shares.

9.5	Singular and Plural . As the context may require, the singular may be read as the plural and the plural as the singular.

9.6	Captions . The captions to the articles, sections, and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

9.7	Applicable Law . This Plan shall be governed and construed in accordance with the laws of the State of New Jersey.

9.8	Severability . If any provisions of this Plan shall, to any extent, be invalid or unenforceable, the remainder of this Plan shall not be affected thereby, and each provision of this Plan shall be valid and enforceable to the fullest extent permitted by law.

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IN WITNESS WHEREOF , the Company has caused this amendment and restatement to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY LIMITED

By:		/s/ Marcia J. Avedon
		Marcia Avedon
		Senior Vice President

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Exhibit 10.52

IR-LIMITED DIRECTOR DEFERRED COMPENSATION

AND STOCK AWARD PLAN II

[As Amended and Restated Effective January 1, 2009]

TABLE OF CONTENTS


SECTION 1 - STATEMENT OF PURPOSE		1

SECTION 2 - DEFINITIONS

2.1	Account Balance	2
2.2	Beneficiary	2
2.3	Beneficiary Designation Form	2
2.4	Board	2
2.5	Code	2
2.6	Deferral Account	2
2.7	Deferral Amount	2
2.8	Deferred IR Stock Award Account	2
2.9	Election Form	2
2.10	Fees	3
2.11	Investment Option Subaccounts	3
2.12	IR Stock	3
2.13	IR Stock Account	3
2.14	Participant	3
2.15	Plan Year	3
2.16	Retirement	3
2.17	Return	3
2.18	Separation from Service	3
2.19	Supplemental Contribution	3
2.20	Supplemental Contribution Account	3
2.21	Trust	3

SECTION 3 - PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

3.1	Participation and Deferral Election	4
3.2	Investment Election	4
3.3	Duration of Elections	5
3.4	Cessation of Deferrals	5

SECTION 4 - VESTING

4.1	Deferral Amounts	5
4.2	Supplemental Contributions	5
4.3	Mandatory Fee Deferrals	6

(i)


SECTION 5 - ACCOUNTS AND VALUATIONS
5.1	Deferral Accounts	6
5.2	Supplemental Contribution Accounts	6
5.3	IR Stock Accounts	7
5.4	Valuation of Account Balance in Event of Change in Control	8
5.5	Changes in Capitalization	8
5.6	Accounts are Bookkeeping Entries	8
5.7	Mandatory Fee Deferral	9

SECTION 6 - DISTRIBUTION OF ACCOUNTS

6.1	Termination, Retirement and Death	9
6.2	Scheduled Distributions	11
6.3	Prohibition of Accelerations	11
6.4	Medium of Payments	11
6.5	Change in Control	12
6.6	Taxes; Withholding	12
6.7	Treatment of Installments; Date of Distribution	12
6.8	Timing of Initial Election Forms	12
6.9	Transition Period Elections	12

SECTION 7 - BENEFICIARY DESIGNATION		13

SECTION 8 - AMENDMENT AND TERMINATION OF PLAN

8.1	Amendment	13
8.2	Termination of Plan	13

SECTION 9 - MISCELLANEOUS

9.1	Unsecured General Creditor	14
9.2	Entire Agreement; Successors	14
9.3	Non-Assignability	15
9.4	Authorization and Source of Shares	15
9.5	Singular and Plural	15
9.6	Captions	15
9.7	Applicable Law	15
9.8	Severability	15

(ii)

IR-Limited Director Deferred Compensation and Stock Award Plan II

As Amended and Restated Effective January 1, 2009

SECTION 1

STATEMENT OF PURPOSE

The purpose of the IR-Limited Director Deferred Compensation and Stock Award Plan II (the “Plan”) is to further increase the mutuality of interest between Ingersoll-Rand Company Limited, a Bermuda company (the “Company”), its non-employee members of the Board (“Non-employee Directors”) and members by providing its Non-employee Directors the opportunity to elect to defer receipt of cash compensation. The Plan shall be unfunded for tax purposes. To the extent Code Section 409A applies to the Plan, the terms of the Plan are intended to comply with that provision, and the terms of the Plan shall be interpreted and administered in accordance therewith.

The Plan is a successor to the IR-Limited Director Deferred Compensation and Stock Award Plan (the “Predecessor Plan”). The Predecessor Plan, which previously was known as the Ingersoll-Rand Company Directors Deferred Compensation and Stock Award Plan, became effective on January 1, 1997, was amended and restated effective January 1, 2001.

On December 31, 2004, the Company froze the Predecessor Plan with respect to all deferrals to the extent such deferrals would otherwise be subject to Code Section 409A (including amounts that were credited under the Predecessor Plan as of December 31, 2004 but were not grandfathered with respect to Code Section 409A). Also on December 31, 2004, the Company adopted the Plan to provide for deferrals of amounts subject to Code Section 409A (including amounts that were credited under the Predecessor Plan as of December 31, 2004 but were not grandfathered with respect to Code Section 409A) on substantially the same terms as those provided under the Predecessor Plan to the extent such terms are not inconsistent with Code Section 409A.

The Company amended and restated the Plan in its entirety, effective August 1, 2007, to conform the terms of the Plan to the requirements of the regulations under Code Section 409A. This further amendment and restatement is generally effective January 1, 2009. The Plan applies to (i) amounts initially deferred hereunder on or after January 1, 2005, (ii) amounts initially credited to the Predecessor Plan before January 1, 2005 that, pursuant to the effective-date rules of Code Section 409A, are subject to the provisions of Code Section 409A, and (iii) investment earnings allocable to amounts described in (i) and (ii). Notwithstanding any other provision of this Plan, no amount will be deferred or credited under this Plan with respect to a Participant for a Plan Year if such amount is properly deferred or credited with respect to such Participant for such Plan Year under the Predecessor Plan.

SECTION 2

DEFINITIONS

2.1

“Account Balance ” means, for each Plan Year, a credit on the records of the Company equal to the sum of the value of a Participant’s Deferral Account, Deferred IR Stock Award Account, Supplemental Contribution Account and IR Stock Account for such Plan Year. The Account Balance shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or to the Participant’s designated Beneficiary, pursuant to the Plan.

2.2	“Beneficiary” means the person or persons designated as such in accordance with Section 7.

2.3	“Beneficiary Designation Form” means the form established from time to time by the Company that a Participant completes and returns to the Secretary of the Company to designate one or more Beneficiaries.

2.4	“Board” means the Board of Directors of the Company.

2.5	“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations and other administrative guidance issued thereunder.

2.6

“Deferral Account” means, for each Plan Year, (i) the sum of all of a Participant’s Deferral Amounts (other than amounts deferred pursuant to Section 5.7), plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s Deferral Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s Deferral Account.

2.7	“Deferral Amount” means the amount of Fees actually deferred under the Plan by the Participant pursuant to Section 3.1 and the amount of Fees automatically deferred pursuant to Section 5.7 for any one Plan Year.

2.8	“Deferred IR Stock Award Account” means, for each Plan Year, all of a Participant’s amounts deferred pursuant to Section 5.7.

2.9

2.10	“Fees” means retainer and meeting fees payable to Non-employee Directors.

2.11	“Investment Option Subaccounts” means the separate subaccounts, each of which corresponds to an investment option elected by the Participant with respect to a Participant’s Deferral Accounts.

2.12	“IR Stock ” means the Class A common shares, par value $1.00 per share, of the Company.

2.13

2.14	“Participant” means a Non-employee Director participating in the Plan in accordance with the provisions of Section 3.

2.15	“Plan Year” means a calendar year.

2.16	“Retirement ” means retirement in accordance with the Board’s retirement policy for Non-employee Directors.

2.17	“Return” means, for each investment option, an amount equal to the net investment return (including changes in value and distributions) for each such investment option during each business day.

2.18	“ Separation from Service” means a separation from service under the rules under Code Section 409A(a)(2)(A)(i), applicable to corporate directors.

2.19

2.20

2.21	“Trust” means the IR Grantor Trust Agreement, dated as of January 1, 2001 between the Company and the trustee named therein, as amended from time to time.

SECTION 3

PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

3.1

Any election to defer a Deferral Amount otherwise payable for services provided by a Non-Employee Director during a Plan Year is irrevocable upon the filing of the Election Form, and must be properly completed and filed no later than: (i) the December 31 immediately preceding such Plan Year; or (ii) with respect to a new Non-employee Director who is described in Code Section 409A(a)(4)(B)(ii), before the earlier of the effective date of his or her election to the Board or the 30th day after such new Non-employee Director first becomes eligible to participate in the Plan (provided that such election shall relate only to amounts earned subsequent to the date such Election Form is filed).

A Non-employee Director who fails to file a properly completed Election Form by such date will be ineligible to defer a Deferral Amount under the Plan for the following Plan Year. In addition, the Company may establish from time to time such other enrollment requirements as it determines are necessary or proper.

If the Company determines in good faith that a Participant no longer qualifies as a Non-employee Director, the Participant shall not be permitted to make any future deferral election under this Section 3.1 for any future Plan Year.

3.2

Investment Election . In accordance with procedures established by the Company, prior to the time a Participant’s Deferral Amounts are credited to a Participant’s Deferral Account pursuant to Section 5.1, the Participant shall designate, on an Election Form, the types of investment options in which the Participant’s Deferral Amounts, other than Fees deferred under Section 5.7, will be deemed to be invested for purposes of determining the amount of earnings to be credited to the Participant’s Deferral Account and, with respect to Deferral Amounts that are designated by the Participant to be deemed to be invested in IR Stock, the IR Stock Account.

Subject to Section 5.3, in making the designations pursuant to this Section, the Participant may specify that all or any portion of the Participant’s Deferral Amount, other than Fees deferred under Section 5.7, be deemed to be invested, in

whole percentage increments, in one or more of the types of investment options provided under the Plan. A Participant may change the designation made under this Section with respect to prior and/or future Deferral Amounts by filing an Election Form no later than the time specified by the Secretary of the Company, to be effective as of the first business day of the following month. If a Participant fails to elect a type of investment option under this Section, he or she shall be deemed to have elected the investment option designated by the Company as the default investment option.

A Participant shall not be permitted to make any election under this Section 3.2 with respect to any Fees deferred under Section 5.7.

3.3

Duration of Elections. Notwithstanding anything to the contrary: (a) any election under Section 3.1 (including a failure to make an election) shall remain in effect from Plan Year to Plan Year unless a written request to modify or terminate that election for a subsequent Plan Year is submitted to the Secretary of the Company in accordance with Section 3.1; and (b) any election under Section 3.2 (including a failure to make an election) shall remain in effect from Plan Year to Plan Year unless a written request to modify or terminate that election is submitted to the Secretary of the Company, which request shall be effective as to any Deferral Amount credited to the Participant’s Deferral Account 30 or more days after such written request is submitted to the Secretary of the Company; provided that nothing in this Section 3.3(b) shall permit a Participant to make such a written request as to the deemed investment of Fees deferred under Section 5.7.

3.4

Cessation of Deferrals. Notwithstanding the foregoing, no Election Form of a Non-Employee Director will be given effect for any period after December 31, 2008, and no Deferral Amount (including any mandatory fee deferral under Section 5.7 of the Plan) shall be credited to a Participant’s Deferral Account with respect to services performed by a Non-Employee Director after December 31, 2008.

SECTION 4

VESTING

4.1	Deferral Amounts . A Participant shall be fully vested in his or her Deferral Account.

4.2

Supplemental Contributions . A Participant shall vest in his or her Supplemental Contribution Account on the earliest of: (i) the fifth anniversary of the date the Supplemental Contribution is credited to the Participant’s Supplemental Contribution Account; (ii) the date of the Participant’s cessation of service on the Board by reason of Retirement or death; (iii) a Change in Control pursuant to Section 6.5; or (iv) a termination of the Plan pursuant to Section 8.2. Notwithstanding the foregoing, effective August 2, 2006, a Participant shall be fully vested in his or her Supplemental Contribution Account.

4.3	Mandatory Fee Deferrals . A Participant shall be fully vested in his or her Deferred IR Stock Award Account.

SECTION 5

ACCOUNTS AND VALUATIONS

5.1

Deferral Accounts . The Company shall establish and maintain a separate Deferral Account for each Participant for each Plan Year. All Deferral Amounts, other than Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock and Fees deferred under Section 5.7, shall be credited to the Participant’s Deferral Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account as described in Section 5.3. All Fees deferred under Section 5.7 shall be credited to the Participant’s Deferred IR Stock Award Account as described in Section 5.7.

Each Participant’s Deferral Accounts shall be divided into Investment Option Subaccounts. A Participant’s Deferral Accounts shall be credited as follows:

5.2

credited to the Participant’s Deferral Account pursuant to Section 5.1. All of a Participant’s Supplemental Contributions shall be deemed to be invested in, and shall remain deemed to be invested in, IR Stock in the Participant’s Supplemental Contribution Account until such amounts are distributed from the Plan.

5.3

IR Stock Accounts . The Company shall establish and maintain a separate IR Stock Account for each Plan Year for each Participant who elects to have all or a portion of his of her Deferral Amounts for such Plan Year invested in IR Stock. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account on the date when the Deferral Amount would otherwise be paid to the Participant. Notwithstanding anything to the contrary, IR Stock credited to a Participant’s IR Stock Account may not be designated by the Participant to be deemed to be invested in any other investment option and shall remain invested in IR Stock in such IR Stock Account until distributed from the Plan. A Participant’s IR Stock Accounts shall be credited as follows:

(a)

On the day a Deferral Amount is credited to a Participant’s IR Stock Account, the Company shall credit the IR Stock Account with an amount equal to the Participant’s Deferral Amount.

(b)

5.4

Valuation of Account Balance in Event of Change in Control . In the event of a Change in Control pursuant to Section 6.5, the value of each IR Stock unit deemed to be invested in each IR Stock Account, Supplemental Contribution Account, and Deferred IR Stock Award Account shall be equal to the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape on the date of the transaction constituting the Change in Control if IR Stock is traded on the New York Stock Exchange on such date, or, if IR Stock is not traded on the New York Stock Exchange on such date but is traded on another securities market on such date, the closing price of one share of IR Stock on such securities market on such date, or, in any other case, the value of one share of IR Stock as determined under the terms of the transaction constituting the Change in Control.

In the event of a Change in Control pursuant to Section 6.5, the value of a Participant’s Account Balances for all investment options other than IR Stock shall be determined as of the end of the month during which the Change in Control occurs.

5.5

Changes in Capitalization . If there is any change in the number or class of shares of IR Stock through the declaration of a stock dividend or other extraordinary dividends, or recapitalization resulting in stock splits, or combinations or exchanges of such shares or in the event of similar corporate transactions, the units in each Participant’s IR Stock Account, Supplemental Contribution Account, and Deferred IR Stock Award Account shall be equitably adjusted to reflect any such change in the number or class of issued shares of IR Stock or to reflect such similar corporate transaction.

5.6

Accounts are Bookkeeping Entries . Notwithstanding any other provision of the Plan that may be interpreted to the contrary, the investment options, including IR Stock, are to be used for measurement purposes only, and a Participant’s election of any such investment option, the allocation to his or her Account Balances, and Deferred IR Stock Award Account thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balances and Deferred IR Stock Award Account shall not be considered or construed in any manner as an actual investment in any such investment option. In the event that the Company or the trustee of the Trust, in its own discretion, decides to invest funds in any or all of the investment options, no Participant shall have any rights in or to such investments themselves. Without limiting the foregoing, a Participant’s Account Balances and Deferred IR Stock Award Account shall at all times be a bookkeeping entry only and shall not represent any investment made on the Participant’s behalf by the Company or the Trust. The Participant shall at all times remain an unsecured creditor of the Company.

5.7

Mandatory Fee Deferral . On each IR Stock quarterly dividend payment date a portion of each Non-employee Director’s Fees equal to $15,000 shall be deferred and credited to the Deferred IR Stock Award Account of such Non-employee Director. Effective January 1, 2007, the amount of mandatory quarterly fee deferral shall be increased to $23,000.

A Participant’s Deferred IR Stock Award Account shall be credited as follows:

(a)

(b)

SECTION 6

DISTRIBUTION OF ACCOUNTS

6.1

Separation from Service and Death . Effective August 1, 2007 or as otherwise provided in Section 6.9, a Participant who has a Separation from Service or dies shall be paid his or her vested Account Balances (and after his or her death to his or her Beneficiary) in a lump sum in the Plan Year following the Participant’s Separation from Service or death unless an optional form of benefit payment is elected in accordance with the next sentence. For each Plan Year’s Account Balance the Participant may elect on an initial Election Form filed in accordance with Section 3.1 by the time specified in Section 6.8, an optional form of benefit payment from among the following:

Annual installments over five (5) years commencing in the Plan Year following the Participant’s Separation from Service or death;

Annual installments over ten (10) years commencing in the Plan Year following the Participant’s Separation from Service or death;

Annual installments over fifteen (15) years commencing in the Plan Year following the Participant’s Separation from Service or death; and

A lump sum distribution payable in the Plan Year specified by the Participant on such Election Form; provided that such specified year shall be no less than one (1) year and no more than five (5) years following the Participant’s Separation from Service or death.

Notwithstanding the foregoing, a Participant may irrevocably elect, on a subsequent Election Form, to change the form and/or extend the timing of a distribution under this Section to a lump sum distribution payable in the Plan Year specified by the Participant on such Election Form, which Plan Year shall not be later than ten (10) years following the Participant’s Separation from Service or death, provided that, as and to the extent required by Code Section 409A(a)(4)(C): (i) no such election shall take effect until twelve months after the date on which such election was made; (ii) no such election (other than an election related to a distribution payable by reason of death) shall be effective unless it defers by a period of at least five years the date on which such distribution would otherwise be made or begin; and (iii) no such election related to a distribution payable at a specified time or pursuant to a fixed schedule (within the meaning of Code Section 409A(a)(2)(A)(iv)) may be made within twelve months of the date such distribution would otherwise be made. As and to the extent required under Code Section 409A(a)(4)(C), the first day of the Plan Year in which a distribution would otherwise be made or begin (but for an election made by the Participant under this paragraph) shall be treated as the date the distribution would otherwise be made or begin for purposes of the rules set forth in the preceding sentence.

In the event of the Participant’s Separation from Service or death prior to the elected date for one or more scheduled distributions pursuant to Section 6.2, the portion of the Participant’s Account Balance associated with such distribution(s) shall be paid to the Participant (and after his or her death to his or her Beneficiary) at the time and in the form determined under this Section 6.1.

Notwithstanding any provision of the Plan to the contrary, if a Participant has a Separation from Service or dies while receiving annual installments pursuant to Section 6.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not had a Separation from Service or died.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Account Balances.

6.2

Scheduled Distributions . A Participant may elect, on an initial Election Form filed in accordance with Section 3.1 by the time specified in Section 6.8, to receive a distribution of all or a portion of his or her Deferral Account and IR Stock Account with respect to such Plan Year(s) while still a Non-employee Director. A Participant’s election for a distribution under this Section shall be permitted only if the date specified on the Election Form by the Participant for such distribution (in the event of a lump sum) or the commencement of such distribution (in the event of annual installments) is no earlier than two (2) years from the last day of the Plan Year for which the portion of the Deferral Account and IR Stock Account to be distributed is actually deferred. At the time an election for a distribution under this Section is made, the Participant shall also elect, on the Election Form, the form of payment of the distribution. The Participant shall elect either (i) a lump sum payment to be paid in the Plan Year specified by the Participant on the Election Form or (ii) annual installments over two (2), three (3), four (4) or five (5) years beginning in the Plan Year specified by the Participant on the Election Form.

A Participant may irrevocably elect, on a subsequent Election Form, to change the form and/or extend the timing of a distribution under this Section, provided that, as and to the extent required by Code Section 409A(a)(4)(C): (i) no such election shall take effect until twelve months after the date on which such election was made; (ii) no such election shall be effective unless it defers by a period of at least five years the date on which such distribution would otherwise be made or begin; and (iii) no such election may be made within twelve months of the date such distribution would otherwise be made. As and to the extent required under Code Section 409A(a)(4)(C), the first day of the Plan Year in which a distribution would otherwise be made or begin (but for an election made by the Participant under this paragraph) shall be treated as the date the distribution would otherwise be made or begin for purposes of the rules set forth in the preceding sentence.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Deferral Account(s) and IR Stock Account(s), as applicable.

6.3	Prohibition of Accelerations. Except to the extent that the Company is permitted under Code Section 409A(a)(3) to exercise discretion to accelerate distributions under the Plan, the time or schedule of any distribution hereunder shall not be accelerated.

6.4

Medium of Payments . All amounts in a Participant’s Deferral Account and payable to a Participant or Beneficiary under the Plan shall be paid in cash. All amounts in a Participant’s Supplemental Contribution Account, Deferred IR Stock Award Account, and IR Stock Account and payable to a Participant or Beneficiary under the Plan shall be paid in IR Stock.

6.5

Change in Control . In the event of a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company, within the meaning of Code Section 409A(a)(2)(A)(v) (a “Change in Control”), all Account Balances shall be valued pursuant to Section 5.4, and shall be distributed in a lump sum within forty five (45) days following such Change in Control.

6.6

6.7

Treatment of Installments; Date of Distribution . For purposes of Code Section 409A, any series of installment payments payable to or with respect to a single Participant shall be treated as a single payment under the Plan. Any distribution due under the Plan shall be made by the last day of the Plan Year in which such distribution, disregarding this sentence, is due under the Plan or such other date as may be permitted or required under Code Section 409A.

6.8

Timing of Initial Election Forms. Any election made on an initial Election Form (but not a subsequent Election Form) referenced in Section 6.1 or 6.2 that applies to a Deferral Amount shall be irrevocable (except to the extent such election is subject to a subsequent election under Section 6.1 or 6.2 as permitted by Code Section 409A(a)(4)(C)) and must be made no later than the election deadline that applies under Section 3.1 to such Deferral Amount or, in the case of a Fees described in Section 5.7, December 31 of the Plan Year preceding the Plan Year in which the Participant performs the services to which such Fees relate.

6.9

Transition Period Elections. Notwithstanding any other provision of this Section 6, on or before December 31, 2008, a Participant may make a new irrevocable election, in writing, to change the time or form of payment of any Deferral Amount under the Plan, provided that no new payment election shall be given effect if (a) it would cause any payment to be made in calendar year 2008, (b) it would defer payment of an amount otherwise payable in calendar year 2008 to a later calendar year, or (c) it would, by its express terms, require payment later than calendar year 2017. A new payment election under this Section 6.9 shall be limited to those times and forms of payment permitted on the election form provided to the Participant.

SECTION 7

BENEFICIARY DESIGNATION

If any distribution to a Beneficiary is to be made in annual installments, and the Beneficiary dies before receiving all such installments, the remaining installments, if any, shall continue to be paid as installments to the estate of the Beneficiary.

SECTION 8

AMENDMENT AND TERMINATION OF PLAN

8.1

8.2	Termination of Plan

Company’s Right to Terminate . The Board (or an authorized Committee of the Board) may terminate the Plan at any time and for any reason.

Payments Upon Termination. As and to the extent permitted under Code Section 409A, all amounts deferred under the Plan with respect to a Participant shall be paid to the Participant, in a lump sum, upon the Company’s termination and liquidation of the Plan, provided that: (1) the termination and liquidation do not occur proximate to a downturn in the financial health of the Company; (2) the Company terminates and

liquidates all agreements, methods, programs, and other arrangements sponsored by the Company that would be aggregated with the Plan and any other terminated and liquidated agreements, methods, programs, and other arrangements under Code Section 409A if the Participant had deferrals of compensation under all the agreements, methods, programs, and other arrangements that are terminated and liquidated; (3) no payments in liquidation of the Plan are made within 12 months of the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan other than payments that would be payable under the terms of the Plan if the action to terminate and liquidate the Plan had not occurred; (4) all payments are made within 24 months of the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan; and (5) the Company does not adopt a new plan that would be aggregated with the Plan or any other terminated and liquidated plan under Code Section 409A if the Participant participated in both plans, at any time within three years following the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan.

SECTION 9

MISCELLANEOUS

9.1

Unsecured General Creditor . Benefits under the Plan shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligations hereunder for payment of benefits at its discretion, provided, however, that no Participant or Beneficiary shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under this Plan, such rights shall be no greater than the right of any unsecured general creditor of the Company. No Participant shall have any of the rights or privileges of a stockholder of the Company under the Plan, including as a result of the crediting of units to the Participant’s IR Stock Account, Supplemental Contribution Account, or Deferred IR Stock Award Account, except at such time as distribution is actually made from the Participant’s IR Stock Account, Supplemental Contribution Account, or Deferred IR Stock Award Account, as applicable.

9.2

Entire Agreement; Successors . The Plan, including the Election Form and any subsequently adopted amendments to the Plan or Election Form, shall constitute the entire agreement or contract between the Company and any Participant regarding this Plan. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Participant relating to the subject matter hereof, other than those set forth herein. This Plan and any amendment hereof shall be binding on the Company and the Participants and, their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated Beneficiaries of the Participant.

9.3

Non-Assignability . To the extent permitted by law, the right of any Participant or any Beneficiary in any benefit hereunder shall not be subject to attachment, garnishment or any other legal process for the debts of such Participant or Beneficiary; nor shall any such benefit be subject to anticipation, alienation, sale, transfer, assignment, pledge or encumbrance.

9.4

9.5	Singular and Plural . As the context may require, the singular may be read as the plural and the plural as the singular.

9.6	Captions . The captions to the articles, sections, and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

9.7	Applicable Law . This Plan shall be governed and construed in accordance with the laws of the State of New Jersey.

9.8	Severability . If any provisions of this Plan shall, to any extent, be invalid or unenforceable, the remainder of this Plan shall not be affected thereby, and each provision of this Plan shall be valid and enforceable to the fullest extent permitted by law.

IN WITNESS WHEREOF , the Company has caused this amendment and restatement to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY LIMITED

By:		/s/ Marcia J. Avedon
Marcia Avedon
Senior Vice President

Exhibit 10.53

IR EXECUTIVE DEFERRED COMPENSATION PLAN

[As Amended and Restated Effective January 1, 2009]

TABLE OF CONTENTS


SECTION 1 - STATEMENT OF PURPOSE		1

SECTION 2 - DEFINITIONS

2.1	Account Balance	1
2.2	Administrative Committee	2
2.3	Base Salary	2
2.4	Beneficiary	2
2.5	Beneficiary Designation Form	2
2.6	Cash Incentive Compensation Award	2
2.7	Change in Control	2
2.8	Code	2
2.9	Compensation Committee	2
2.10	Deferral Account	2
2.11	Deferral Amount	3
2.12	Disability	3
2.13	Discretionary Company Contribution	3
2.14	Discretionary Company Contribution Account	3
2.15	Dividends on Stock Grants	3
2.16	Early Distribution	3
2.17	Effective Time	3
2.18	Elected Officer	4
2.19	Election Form	4
2.20	Eligible Employee	4
2.21	ERISA	4
2.22	Investment Option Subaccounts	4
2.23	IR Stock	4
2.24	IR Stock Account	4
2.25	Merger Agreement	4
2.26	Participant	4
2.27	Participating Employer	5
2.28	Plan Year	5
2.29	Retirement	5
2.30	Return	5
2.31	Service	5
2.32	Supplemental Contribution	5
2.33	Supplemental Contribution Account	5
2.34	Trust	5
2.35	Unforeseeable Financial Emergency	5

SECTION 3 – ADMINISTRATION OF THE PLAN		6

(i)


SECTION 4 - PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

4.1	Participation and Deferral Election	6
4.2	Investment Election	7

SECTION 5 - VESTING

5.1	Deferral Amounts	8
5.2	Supplemental Contributions	8
5.3	Discretionary Contributions	8

SECTION 6 - ACCOUNTS AND VALUATIONS

6.1	Deferral Accounts	9
6.2	Supplemental Contribution Accounts	9
6.3	Discretionary Company Contribution Accounts	10
6.4	IR Stock Accounts	11
6.5	Changes in Capitalization	12
6.6	Accounts are Bookkeeping Entries	12

SECTION 7 - DISTRIBUTION OF ACCOUNTS

7.1	Termination with Five Years of Service, Retirement, Disability and Death	13
7.2	Scheduled Distributions Prior to Termination of Employment	14
7.3	Termination of Employment Prior to Completing Five (5) Years of Service	15
7.4	Transfer of Employment	15
7.5	Hardship Distribution	15
7.6	Early Distributions (with forfeiture)	15
7.7	Form of Payments	16
7.8	Taxes; Withholding	16
7.9	Distribution Provisions	16

SECTION 8 - BENEFICIARY DESIGNATION		17

SECTION 9 - AMENDMENT AND TERMINATION OF PLAN

9.1	Amendment	17
9.2	Termination of Plan	17

SECTION 10 - MISCELLANEOUS

10.1	Unsecured General Creditor	18

(ii)


10.2	Entire Agreement; Successors	18
10.3	Non-Assignability	18
10.4	No Contract of Employment	18
10.5	Authorization and Source of Shares	19
10.6	Singular and Plural	19
10.7	Captions	19
10.8	Applicable Law	19
10.9	Severability	19
10.10	Notice	19

(iii)

IR Executive Deferred Compensation Plan

As Amended and Restated Effective January 1, 2009

SECTION 1

STATEMENT OF PURPOSE

The purpose of the IR Executive Deferred Compensation Plan (the “Plan”) is to further increase the mutuality of interest between Ingersoll-Rand Company (the “Company”), its employees, the employees of a Participating Employer and members of Ingersoll-Rand Company Limited by providing a select group of management and highly compensated employees of the Company or a Participating Employer the opportunity to elect to defer receipt of cash compensation. The Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA. The Plan, originally known as the Ingersoll-Rand Company Executive Deferred Compensation and Stock Bonus Plan, became effective on January 1, 1997, was amended and restated effective January 1, 2001, and was again amended and restated effective August 1, 2007. This further amendment and restatement is effective January 1, 2009.

Notwithstanding any other provision of the Plan to the contrary (including any election made by any Participant under the Plan), (i) no amount shall be deferred under the Plan if, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004, Q&A-16 of IRS Notice 2005-1, and Treasury Regulations section 1.409A-6(a), such amount would be subject to Section 409A of the Internal Revenue Code of 1986, as amended (a “Non-Grandfathered New Deferral Amount”), and (ii) any amount previously deferred under the Plan that, pursuant to the effective date rules of Section 885(d) of the American Jobs Creation Act of 2004, Q&A-16 of IRS Notice 2005-1, and Treasury Regulations section 1.409A-6(a), is subject to Section 409A of the Internal Revenue Code of 1986, as amended (a “Non-Grandfathered Prior Deferral Amount”) shall no longer be credited or payable under the Plan after December 31, 2004. Any Non- Grandfathered New Deferral Amount shall instead be deferred under the IR Executive Deferred Compensation Plan II, and any Non-Grandfathered Prior Deferral Amount shall instead be credited under the IR Executive Deferred Compensation Plan II, as and to the extent provided under the terms of the IR Executive Deferred Compensation Plan II.

SECTION 2

DEFINITIONS

2.1

“Account Balance” means, for each Plan Year, a credit on the records of the Company equal to the sum of the value of a Participant’s Deferral Account, Supplemental Contribution Account, Discretionary Company Contribution Account and IR Stock Account for such Plan Year. The Account Balance shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or to the Participant’s designated Beneficiary, pursuant to the Plan.

2.2	“Administrative Committee” shall mean the committee appointed by the Chief Executive Officer of the Company which will administer the Plan in accordance with the duties delegated to it by the Compensation Committee or as set forth herein.

2.3

“Base Salary” means a Participant’s annual base salary, excluding bonuses, commissions, incentive compensation and all other remuneration for services rendered to the Company or a Participating Employer and prior to a reduction for any salary contributions to a plan established pursuant to Code Section 125 or qualified pursuant to Code Section 401(k).

2.4	“Beneficiary” means the person or persons designated as such in accordance with Section 8.

2.5	“Beneficiary Designation Form” means the form established from time to time by the Administrative Committee that a Participant completes and returns to the Administrative Committee to designate one or more Beneficiaries.

2.6	“Cash Incentive Compensation Award” means any of the Participant’s annual cash incentive compensation awards.

2.7

“Change in Control” means a “change in control of the Company” (as set forth in the Company’s Incentive Stock Plan of 2007) or any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company, other than any sale, lease, exchange or other transfer to any person or entity where the Company owns, directly or indirectly, at least 80 percent of the outstanding voting securities of such person or entity after any such transfer, unless a different definition is used for purposes of any severance of employment agreement or change of control arrangement between the Company and a Participant, in which event such definition shall apply. Notwithstanding the foregoing, for purposes of this Section 2.7, the term “Company” shall mean Ingersoll-Rand Company Limited.

2.8	“Code” means the Internal Revenue Code of 1986, as amended from time to time.

2.9	“Compensation Committee” means the Compensation Committee of the Board of Directors of Ingersoll-Rand Company Limited.

2.10

“Deferral Account” means, for each Plan Year, (i) the sum of all of a Participant’s Deferral Amounts, plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s Deferral Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s Deferral Account.

2.11

“Deferral Amount” means the amount of a Participant’s Cash Incentive Compensation Award, Base Salary and Dividends on Stock Grants actually deferred under the Plan by the Participant pursuant to Section 4 for any one Plan Year. Effective May 29, 2003, Deferral Amount shall also mean, with respect to a Participant who participates in the Ingersoll-Rand Company Elected Officers Supplemental Program or the Ingersoll-Rand Company Supplemental Key Management Plan, the amount that would be payable to the Participant under the Ingersoll-Rand Company Elected Officers Supplemental Program, Ingersoll-Rand Company Supplemental Key Management Plan, Ingersoll-Rand Company Supplemental Employee Savings Plan and/or the Ingersoll-Rand Company Supplemental Pension Plan but for the Participant’s deferral under Section 4 of the Plan and the applicable provisions of the Ingersoll-Rand Company Supplemental Employee Savings Plan and/or the Ingersoll-Rand Company Supplemental Pension Plan.

2.12	“Disability” means the Participant is eligible to receive benefits under a long-term disability plan maintained by the Company or a Participating Employer.

2.13	“Discretionary Company Contribution” means an additional amount to be credited to a Participant’s Discretionary Contribution Account for a Plan Year.

2.14

“Discretionary Company Contribution Account” means, for each Plan Year, (i) the sum of all of a Participant’s Discretionary Company Contributions, plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s Discretionary Company Contribution Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s Discretionary Company Contribution Account.

2.15	“Dividends on Stock Grants” means the dividends on deferred stock grants payable to a Participant pursuant to the Ingersoll-Rand Company Incentive Stock Plan of 1998.

2.16

“Early Distribution” means an election by the Participant, pursuant to Section 7.6, to receive a distribution of amounts from the Participant’s Deferral Account, IR Stock Account, vested Discretionary Company Contribution Account and vested Supplemental Contribution Account with respect to a specific Plan Year prior to the time at which such Participant would otherwise be entitled to such amounts.

2.17	“Effective Time” means the Effective Time as such time is defined in the Merger Agreement.

2.18	“Elected Officer” means an officer of the Company elected to such position by the Board of Directors of the Company.

2.19

“Election Form” means the form or forms established from time to time by the Administrative Committee that a Participant completes, signs and returns to the Administrative Committee to make an election under the Plan. An Election Form also includes any other method approved by the Administrative Committee, in its sole and absolute discretion, that a Participant may use to make an election under the Plan. The terms and conditions specified in the Election Form(s) are incorporated by reference herein and form a part of the Plan. If there is a conflict between the Election Form and the Plan, the terms of the Plan shall control and govern.

2.20

“Eligible Employee” means an Elected Officer or an individual who is among a select group of management and highly compensated employees of the Company or a Participating Employer who has been selected by the Administrative Committee, in its sole and absolute discretion, to participate in the Plan.

2.21	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

2.22

“Investment Option Subaccounts” means the separate subaccounts, each of which corresponds to an investment option elected by the Participant or, as provided in Section 6.3 regarding Discretionary Company Contributions, the Administrative Committee, with respect to a Participant’s Deferral Accounts and/or Discretionary Company Contribution Accounts, as applicable.

2.23	“IR Stock ” means the Class A common shares, par value $1.00 per share, of Ingersoll-Rand Company Limited, a Bermuda company.

2.24

“IR Stock Account” means, for each Plan Year, (i) the sum of all of a Participant’s Deferral Amounts and Discretionary Company Contributions that are deemed to be invested in IR Stock, plus (ii) amounts credited in accordance with all the applicable crediting provisions of the Plan that relate to the Participant’s IR Stock Account, less (iii) all distributions made to the Participant or to the Participant’s Beneficiary pursuant to the Plan that relate to the Participant’s IR Stock Account.

2.25	“Merger Agreement” means that certain Agreement and Plan of Merger among the Company, Ingersoll-Rand Company Limited, and IR Merger Corporation dated as of October 31, 2001, pursuant to which the Company became an indirect wholly-owned subsidiary of Ingersoll-Rand Company Limited.

2.26	“Participant” means an Eligible Employee participating in the Plan in accordance with the provisions of Section 4.

2.27	“Participating Employer” means any direct or indirect parent, subsidiary or affiliate of the Company.

2.28	“Plan Year” means a calendar year.

2.29	“Retirement” means termination of employment by a Participant after he or she has attained age 65 (62 for Elected Officers) or termination at or after age 55 with at least five (5) years of Service.

2.30	“Return” means, for each investment option, an amount equal to the net investment return (including changes in value and distributions) for each such investment option during each business day.

2.31	“Service” means periods of service with the Company or a Participating Employer as determined by the Administrative Committee in its sole and absolute discretion.

2.32

“Supplemental Contribution” means an additional amount to be credited to a Participant’s Supplemental Contribution Account equal to twenty percent (20%) of the Participant’s Cash Incentive Compensation Award that is deferred under Section 6.1 of the Plan for a Plan Year by the Participant and is, at the time of making the deferral election, elected to be invested in the Participant’s IR Stock Account. Supplemental Contributions shall be available and credited only to Participants whose job category indicates specified ownership guidelines as determined by the Compensation Committee in its sole and absolute discretion.

2.33

2.34	“Trust” means the Ingersoll-Rand Company Deferred Compensation Trust Agreement, dated as of January 1, 2001 between the Company and the trustee named therein, as amended from time to time.

2.35

“Unforeseeable Financial Emergency” means severe financial hardship to the Participant resulting from a sudden and unexpected illness or accident of the Participant or a dependent of the Participant, loss of the Participant’s property due to casualty or other similar or extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The circumstances that would constitute an unforeseeable financial emergency will depend upon the facts of each case, but, in any case, a hardship benefit may not be made to the extent that such hardship is or may be relieved (i) through reimbursement or compensation by insurance or otherwise, (ii) by liquidation of the Participant’s assets, to the extent the liquidation of assets would not itself cause severe financial hardship, or (iii) by cessation of Deferral Amounts under the Plan.

SECTION 3

ADMINISTRATION OF THE PLAN

The Plan shall be administered by the Compensation Committee (or any successor committee). The Compensation Committee has delegated authority to the Administrative Committee to administer the Plan in accordance with the provisions of this Section. Notwithstanding the previous sentence, the Compensation Committee shall retain authority for determining (i) a Participant’s eligibility to receive Supplemental Contributions, and (ii) eligibility for, and the amount of, Discretionary Company Contributions with respect to Participants whose job category indicates specified ownership guidelines as determined by the Compensation Committee.

The primary responsibility of the Administrative Committee is to administer the Plan for the exclusive benefit of Participants and their Beneficiaries, subject to the specific terms of the Plan. The Administrative Committee shall administer the Plan in accordance with its terms to the extent consistent with applicable law, and shall have the power to determine all questions arising in connection with the administration, interpretation, and application of the Plan. Any such determination by the Administrative Committee shall be conclusive and binding upon all affected parties. Any denial by the Administrative Committee of a claim for benefits under the Plan by a Participant or Beneficiary shall be stated in writing by the Administrative Committee and delivered or mailed to the Participant or Beneficiary. Such notice shall set forth the specific reasons for the Administrative Committee’s decision. In addition, the Administrative Committee shall afford a reasonable opportunity to any Participant or Beneficiary whose claim for benefits has been denied for a review of the decision denying this claim.

SECTION 4

PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION.

4.1

Participation and Deferral Election . Any Eligible Employee may elect to participate in the Plan for a given Plan Year by filing a completed Election Form for the Plan Year in the manner prescribed by the Administrative Committee. The Election Form must specify the percentage or dollar amount of any Deferral Amount otherwise payable during such Plan Year that will be deferred under the Plan. Notwithstanding the previous sentence, an election to defer Dividends on Stock Grants shall be equal to one hundred percent (100%) of the Dividends on Stock Grants. The minimum total dollar amount of a Participant’s Deferral Amount that a Participant may defer under the Plan for any Plan Year is $5,000.

Any election to defer a Deferral Amount is irrevocable upon the filing of the Election Form, and must be properly completed and filed no later than the November 30 immediately preceding such Plan Year, or such other date as the Administrative Committee may specify. An Eligible Employee who fails to file a properly completed Election Form by such date will be ineligible to defer a Deferral Amount under the Plan for the following Plan Year. In addition, the Administrative Committee, in its sole and absolute discretion, may establish from time to time such other enrollment requirements as it determines are necessary or proper.

Notwithstanding anything to the contrary, the Administrative Committee, in its sole and absolute discretion, shall determine from time to time the percentage of Base Salary that may be deferred by Participants under the Plan in any Plan Year. Once such a determination is made the percentage shall remain in effect until changed by the Administrative Committee.

If the Administrative Committee determines in good faith that a Participant no longer qualifies as a member of a select group of management or highly compensated employees, as membership in such group is determined in accordance with ERISA Sections 201(2), 301(a)(3) and 401(a)(1), the Administrative Committee shall have the right, in its sole and absolute discretion, to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which the Participant’s membership status changes, (ii) prevent the Participant from making future deferral elections and/or (iii) immediately distribute the Participant’s then vested Account Balances and terminate the Participant’s participation in the Plan.

4.2

Investment Election . In accordance with procedures established by the Administrative Committee in its sole and absolute discretion, prior to the time a Participant’s Deferral Amounts are credited to a Participant’s Deferral Account pursuant to Section 6.1, the Participant shall designate, on an Election Form, the types of investment options in which the Participant’s Deferral Amounts will be deemed to be invested for purposes of determining the amount of earnings to be credited to the Participant’s Deferral Account and, with respect to Deferral Amounts that are designated by the Participant to be deemed to be invested in IR Stock, the IR Stock Account.

Subject to the right of the Administrative Committee to direct the types of investment options in which a Participant’s Discretionary Company Contributions will be deemed to be invested as described in Section 6.3, in the event a Participant receives a Discretionary Company Contribution, the Participant shall, at the time designated by the Administrative Committee, in its sole and absolute discretion, designate, on an Election Form, the types of investment options in which the Participant’s Discretionary Company Contributions will be deemed to be invested for purposes of determining the amount of earnings to be credited to the Participant’s Discretionary Company Contribution Account and, with respect to Discretionary Company Contributions that are designated by the Participant to be deemed to be invested in IR Stock, the IR Stock Account.

In making the designations pursuant to this Section, the Participant may specify that all or any portion of the Participant’s Deferral Amount and, subject to Section 6.3, Discretionary Company Contributions be deemed to be invested, in whole percentage increments, in one or more of the types of investment options provided under the Plan as communicated from time to time by the Administrative Committee. Subject to Section 6.4, a Participant may change the designation made under this Section with respect to prior and/or future Deferral Amounts and/or, subject to Section 6.3, prior and/or future Discretionary Company Contributions by filing an Election Form no later than the time specified by the Administrative Committee, in its sole and absolute discretion, to be effective as of the first business day of the following month. Except for Discretionary Company Contributions that the Administrative Committee, pursuant to Section 6.3, has directed the investment options in which a Participant’s Discretionary Company Contributions shall be deemed to be invested, if a Participant fails to elect a type of investment option under this Section, he or she shall be deemed to have elected the investment option designated by the Administrative Committee as the default investment option.

SECTION 5

VESTING

5.1.	Deferral Amounts . A Participant shall be fully vested in his or her Deferral Account.

5.2.

Supplemental Contributions . A Participant shall vest in his or her Supplemental Contribution Account on the earliest of: (i) the fifth anniversary of the date the Supplemental Contribution is credited to the Participant’s Supplemental Contribution Account; (ii) the date of the Participant’s Retirement; (iii) the Participant’s Disability; (iv) the Participant’s death; (v) a Change in Control; or (vi) a termination of the Plan pursuant to Section 9.2.

5.3.

Discretionary Contributions. A Participant shall vest in his or her Discretionary Company Contribution Account on the earliest of: (i) the date determined by the Administrative Committee; (ii) the date of the Participant’s Disability; (iii) the date of the Participant’s death; (iv) a Change in Control; or (v) a termination of the Plan pursuant to Section 9.2. Notwithstanding the above, to the extent an agreement between the Company and the Participant contains provisions governing vesting with regards to a Discretionary Company Contribution made on behalf of the Participant, the terms of such agreement shall apply.

SECTION 6

ACCOUNTS AND VALUATIONS

6.1

Deferral Accounts . The Administrative Committee shall establish and maintain a separate Deferral Account for each Participant for each Plan Year. All Deferral Amounts, other than Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s Deferral Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account as described in Section 6.4.

Each Participant’s Deferral Accounts shall be divided into Investment Option Subaccounts. A Participant’s Deferral Accounts shall be credited as follows:

(a)

(b)

6.2

Supplemental Contribution Accounts. The Administrative Committee shall establish and maintain a separate Supplemental Contribution Account for each Plan Year for each Participant who receives a Supplemental Contribution for such Plan Year. All Supplemental Contributions shall be credited to the Participant’s Supplemental Contribution Account on the same date that the Participant’s Deferral Amount applicable to a Cash Incentive Compensation Award for which the Supplemental Contribution is being made is credited to the Participant’s Deferral Account pursuant to Section 6.1. All of a Participant’s Supplemental Contributions shall be deemed to be invested in, and shall remain deemed to be invested in, IR Stock in the Participant’s Supplemental Contribution Account until such amounts are distributed from the Plan.

closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Supplemental Contributions are credited to a Participant’s Supplemental Contribution Account, the number of units to be credited shall be determined by dividing the number of units by the value of a unit on such date.

6.3

Discretionary Company Contribution Accounts . The Administrative Committee shall establish and maintain a separate Discretionary Company Contribution Account for each Plan Year for each Participant who receives a Discretionary Company Contribution for such Plan Year. All Discretionary Company Contributions, other than those that are deemed, at the Participant’s election or as directed by the Administrative Committee pursuant to the following paragraph, to be invested in IR Stock shall be credited to the Participant’s Discretionary Company Contribution Account on the date determined by the Administrative Committee in its sole and absolute discretion. All Discretionary Company Contributions that are deemed, at the Participant’s election or as directed by the Administrative Committee, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account as described in Section 6.4.

Each Participant’s Discretionary Company Contribution Accounts shall be divided into Investment Option Subaccounts. Notwithstanding the previous sentence, the Administrative Committee may, in its sole and absolute discretion, at the time a Discretionary Company Contribution is made, direct that a Participant’s Discretionary Company Contribution be invested in any one or more of the Investment Option Subaccounts (including the IR Stock Account) and that such Discretionary Company Contribution remain invested in such Investment Option Subaccounts until at least such time as the Administrative Committee, in its sole and absolute discretion, determines that such Discretionary Company Contribution, or portion thereof, may, except as otherwise provided in Section 6.4, be invested in Investment Option Subaccounts elected by the Participant. A Participant’s Discretionary Company Contribution Accounts shall be credited as follows:

(a)

On the day a Discretionary Company Contribution is credited to a Participant’s Discretionary Company Contribution Account, the Administrative Committee shall credit the Investment Option Subaccounts of the Participant’s Discretionary Company Contribution Account with an amount equal to the Participant’s Discretionary Company Contribution in accordance with the Participant’s Election Form or as directed by the Administrative Committee; that is, the portion of the Participant’s Discretionary Company Contribution that the Participant has elected, or

that the Administrative Committee has directed, to be deemed to be invested in a certain type of investment option shall be credited to the Investment Option Subaccount corresponding to that investment option.

(b)

Each business day, each Investment Option Subaccount of a Participant’s Discretionary Company Contribution Account shall be adjusted for earnings or losses in an amount equal to that determined by multiplying the balance credited to such Investment Option Subaccount as of the prior day plus contributions credited that day to the Investment Option Subaccount by the Return for the corresponding investment option.

To the extent an agreement between the Company and the Participant contains provisions governing the deemed investment of Discretionary Company Contributions made on behalf of the Participant, the deemed investment provisions of such agreement shall apply.

6.4

IR Stock Accounts . The Administrative Committee shall establish and maintain a separate IR Stock Account for each Plan Year for each Participant who (i) elects to have all or a portion of his of her Deferral Amounts and/or Discretionary Company Contributions for such Plan Year invested in IR Stock or, (ii) receives a Discretionary Company Contribution which is directed, pursuant to Section 6.3, by the Administrative Committee to be deemed to be invested in IR Stock. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Discretionary Company Contributions that are deemed, whether at the Participant’s election or as directed by the Administrative Committee, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account on the date determined by the Administrative Committee in its sole and absolute discretion. Notwithstanding anything to the contrary, IR Stock credited to a Participant’s IR Stock Account may not be designated by the Participant to be deemed to be invested in any other investment option and shall remain invested in IR Stock in such IR Stock Account until distributed from the Plan. A Participant’s IR Stock Accounts shall be credited as follows:

(a)

On the day a Deferral Amount or Discretionary Company Contribution is credited to a Participant’s IR Stock Account, the Administrative Committee shall credit the IR Stock Account with an amount equal to the Participant’s Deferral Amount and/or Discretionary Company Contribution.

(b)

determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Deferral Amounts and/or Discretionary Company Contributions are credited to the Participant’s IR Stock Account, the number of units to be credited shall be determined by dividing the amount of such Deferral Amounts and/or Discretionary Company Contributions by the value of a unit on such date.

6.5

Changes in Capitalization . If there is any change in the number or class of shares of IR Stock through the declaration of a stock dividend or other extraordinary dividends, or recapitalization resulting in stock splits, or combinations or exchanges of such shares or in the event of similar corporate transactions, the units in each Participant’s IR Stock Account and Supplemental Contribution Account shall be equitably adjusted to reflect any such change in the number or class of issued shares of IR Stock or to reflect such similar corporate transaction.

6.6

Accounts are Bookkeeping Entries . Notwithstanding any other provision of the Plan that may be interpreted to the contrary, the investment options, including IR Stock, are to be used for measurement purposes only, and a Participant’s election of any such investment option, the allocation to his or her Account Balances thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balances shall not be considered or construed in any manner as an actual investment of his or her Account Balances in any such investment option. In the event that the Company or the trustee of the Trust, in its own discretion, decides to invest funds in any or all of the investment options, no Participant shall have any rights in or to such investments themselves. Without limiting the foregoing, a Participant’s Account Balances shall at all times be a bookkeeping entry only and shall not represent any investment made on the Participant’s behalf by the Company or the Trust. The Participant shall at all times remain an unsecured creditor of the Company.

SECTION 7

DISTRIBUTION OF ACCOUNTS

7.1

Termination with Five Years of Service, Retirement, Disability and Death . A Participant who terminates employment after completing at least five (5) years of Service, reaches Retirement, incurs a Disability, or dies shall be paid his or her vested Account Balances (and after his or her death to his or her Beneficiary) in annual installments over ten (10) years beginning as soon as administratively practicable in the year following the Participant’s termination, Retirement, Disability or death unless an optional form of benefit payment is elected in accordance with the next sentence. For each Plan Year’s Account Balance the Participant may elect an optional form of benefit payment in the manner prescribed by the Administrative Committee, in its sole and absolute discretion, from among the following:

(1)

A lump sum distribution to be paid as soon as administratively practicable in the year following the Participant’s termination, Retirement, Disability or death;

(2)

Annual installments over five (5) years commencing as soon as administratively practicable in the year following the Participant’s termination, Retirement, Disability or death;

(3)

Annual installments over fifteen (15) years commencing as soon as administratively practicable in the year following the Participant’s termination, Retirement, Disability or death; and

(4)

In the event of the Participant’s termination of employment with the Company with five (5) years of Service, Retirement, Disability or death prior to the elected date for one or more scheduled distributions prior to termination of employment under Section 7.2, the portion of the Participant’s Account Balance associated with such distribution(s) shall be paid to the Participant (and after his or her death to his or her Beneficiary) in the same form as elected by the Participant under this Section.

Notwithstanding any provision of the Plan to the contrary, if a Participant terminates employment after completing five (5) years of Service, has reached Retirement, incurs a Disability or dies while receiving annual installments prior to termination of employment pursuant to Section 7.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not terminated employment, reached Retirement, incurred a Disability or died.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Account Balances.

7.2

Scheduled Distributions Prior to Termination of Employment . A Participant may elect, on an Election Form, to receive a distribution of all or a portion of his or her Deferral Account, IR Stock Account and vested Discretionary Company Contribution Account with respect to a Plan Year(s) while still employed by the Company. A Participant’s election for a distribution under this Section shall be permitted only if the distribution date has been specified on an original Election Form timely filed by the Participant under Section 4.1, and such distribution date (in the event of a lump sum) or the date of commencement of such distribution (in the event of annual installments) is no earlier than two (2) years from the last day of the Plan Year for which the portion of the Deferral Account, IR Stock Account and vested Discretionary Company Contribution Account to be distributed was actually deferred. A Participant may elect, on an Election Form, to extend the date for any distribution under this Section with respect to any Plan Year, provided such election occurs at least one year before the date of distribution most recently elected for that Plan Year by the Participant and the extension is for a period of not less than two (2) years after the date of distribution most recently elected for that Plan Year by the Participant. The Participant shall have the right to extend the date for any distribution under this Section for a Plan Year twice.

All distributions under this Section shall be made on a pro rata basis from the Participant’s Deferral Account(s), IR Stock Account(s) and vested Discretionary Company Contribution Account(s), as applicable.

7.3

Termination of Employment Prior to Completing Five (5) Years of Service . If a Participant’s employment with the Company terminates prior to his or her completing five (5) years of Service, the vested portion of the Participant’s Account Balances, if any, shall be distributed in a lump sum as soon as practicable in the year following the Participant’s termination of employment. If a Participant’s employment with the Company terminates prior to his or her completing five (5) years of Service while receiving annual installments prior to termination of employment pursuant to Section 7.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not terminated employment prior to completing five (5) years of Service. For purposes of this Section, Disability, death and Retirement shall be deemed not to be a termination of employment.

7.4

Transfer of Employment . Notwithstanding any provision of Sections 7.1, 7.2 or 7.3 to the contrary, a Participant shall not be considered to have terminated employment during a Plan Year, if such Participant is continuously employed during that Plan Year by the Company, a Participating Employer, or any subsidiaries or affiliates of a Participating Employer, or any combination thereof.

7.5

Hardship Distribution . In the event that the Administrative Committee, upon written petition of the Participant (or the Participant’s Beneficiary) on an Election Form filed with the Administrative Committee specifying the Plan Year(s), from which payment shall be made, determines in its sole and absolute discretion, that the Participant (or the Participant’s Beneficiary) has suffered an Unforeseeable Financial Emergency, the Company may pay to the Participant (or the Participant’s Beneficiary) in a lump sum from the Participant’s Deferral Account(s), IR Stock Account(s), vested portion of the Discretionary Contribution Account(s) and the vested portion of the Supplemental Contribution Account(s) with respect to the specified Plan Year(s), as soon as practicable following such determination, an amount appropriate under the circumstances. All distributions under this Section shall be made on a pro rata basis from the Participant’s Deferral Account(s), IR Stock Account(s), vested Discretionary Company Contribution Account(s) and vested Supplementary Contribution Account(s), as applicable.

7.6

Early Distributions (with forfeiture) . A Participant shall be permitted to elect, on an Election Form, to receive an Early Distribution in whole percentages of up to 100% of his or her Deferral Account(s), IR Stock Account(s) and vested Discretionary Company Contribution Account(s) with respect to a specified Plan Year(s), subject to the following restrictions:

(1)

10% of the amount elected by the Participant to be distributed as an Early Distribution shall be permanently forfeited and such forfeited amount shall be deducted from the amount to be distributed to the Participant.

(2)

If a Participant receives an Early Distribution, the Participant will be ineligible to participate in the Plan for the balance of the Plan Year in which the Early Distribution is received and for the following Plan Year. All Early Distributions shall be made on a pro rata basis from the Participant’s Deferral Account(s), IR Stock Account(s) and vested Discretionary Company Contribution Account(s).

(3)

The Early Distribution shall be paid in a single lump sum as soon as administratively practicable after the Early Distribution election is made.

7.7

Form of Payments. All amounts in a Participant’s Deferral Account and Discretionary Company Contribution Account and payable to a Participant or Beneficiary under the Plan shall be paid in cash. All amounts in a Participant’s Supplemental Contribution Account and IR Stock Account and payable to a Participant or Beneficiary under the Plan shall be paid in IR Stock; except that, with respect to any fractional share, such fractional share shall be paid in cash.

7.8

7.9

Distribution Provisions. Effective January 1, 2004, to the extent an agreement between the Company and a Participant contains provisions governing the form and/or timing of a distribution of a Discretionary Company Contribution made on behalf of the Participant, the distribution provisions of such agreement shall apply. Except as provided in an agreement between the Company and the Participant, the form and/or timing of a Discretionary Company Contribution shall be determined by the Administrative Committee in its sole and absolute discretion.

SECTION 8

BENEFICIARY DESIGNATION

A Participant shall have the right to designate a Beneficiary(ies) to receive the Participant’s Account Balances in the event the Participant dies prior to receiving all of his or her Account Balances. A Beneficiary designation shall be made, and may be amended at any time, by the Participant by filing a written designation with the Administrative Committee, on such form and in accordance with such procedures as the Administrative Committee shall establish from time to time. A Participant may change the designated Beneficiary under the Plan at any time by providing such designation in writing to the Administrative Committee.

SECTION 9

AMENDMENT AND TERMINATION OF PLAN

9.1

Amendment. The Plan may, at any time and from time to time, be amended without the consent of any Participant or Beneficiary, by (a) the Compensation Committee or the Board of Directors of Ingersoll-Rand Company Limited, or (b) the Administrative Committee in the case of amendments which do not materially modify the provisions hereof; provided, however, that no amendment shall reduce any benefits accrued under the terms of the Plan as of the date of amendment.

9.2	Termination of Plan

Company’s Right to Terminate. The Board of Directors of Ingersoll-Rand Company Limited may terminate the Plan at any time and for any reason.

Payments Upon Termination. Upon any termination of the Plan under this Section, Base Salary, Cash Incentive Compensation Awards, Dividends on Stock Grants, Discretionary Company Contributions and

Supplemental Contributions shall prospectively cease to be deferred and, with respect to all such amounts previously deferred, the Company shall pay to the Participant, in a lump sum, as soon as administratively practicable, the value of the Participant’s Account Balances.

SECTION 10

MISCELLANEOUS

10.1

Unsecured General Creditor . Benefits under the Plan shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligations hereunder for payment of benefits at its discretion, provided, however, that no Participant or Beneficiary shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under the Plan, such rights shall be no greater than the right of any unsecured general creditor of the Company. No Participant shall have any rights or privileges of a stockholder of the Company or of a member of Ingersoll-Rand Company Limited under the Plan, including as a result of the crediting of units to a Participant’s IR Stock Account or Supplemental Contribution Account, except at such time as distribution is actually made from the Participant’s IR Stock Account or Supplemental Contribution Account, as applicable.

10.2

Entire Agreement; Successors . The Plan, including the Election Form and any subsequently adopted amendments to the Plan or Election Form, shall constitute the entire agreement or contract between the Company and any Participant regarding the Plan. There are no covenants, promises, agreements, conditions or understandings, either oral or written, between the Company and any Participant relating to the subject matter hereof, other than those set forth herein. The Plan and any amendment hereof shall be binding on the Company and the Participants and, their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated Beneficiaries of the Employee.

10.3

10.4

No Contract of Employment. The establishment of the Plan or any modification hereof shall not give any Participant or other person the right to remain in the service of the Company, a Participating Employer, or any subsidiaries or affiliates of a Participating Employer, and all Participants and other persons shall remain subject to discharge to the same extent as if the Plan had never been adopted.

10.5

Authorization and Source of Shares . Shares of IR Stock necessary to meet the obligations of the Plan have been reserved and authorized pursuant to resolutions adopted by the Board of Directors of the Company on December 4, 1996, and additional shares of IR Stock shall be reserved and authorized for delivery under the Plan from time to time. These shares of IR Stock may be provided from newly-issued or treasury shares.

10.6	Singular and Plural . As the context may require, the singular may be read as the plural and the plural as the singular.

10.7	Captions . The captions to the articles, sections, and paragraphs of the Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

10.8	Applicable Law . Except as preempted by federal law, the Plan shall be governed and construed in accordance with the laws of the State of New Jersey.

10.9	Severability . If any provisions of the Plan shall, to any extent, be invalid or unenforceable, the remainder of the Plan shall not be affected thereby, and each provision of the Plan shall be valid and enforceable to the fullest extent permitted by law.

10.10

Notice . Any notice or filing required or permitted to be given to the Administrative Committee shall be sufficient if in writing and hand delivered, or sent by registered or certified mail, to the Company at 155 Chestnut Ridge Road, Montvale, NJ 07645, directed to the attention of the Senior Vice President, Human Resources. Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Any notice to the Participant shall be addressed to the Participant at the Participant’s residence address as maintained in the Company’s records. Any party may change the address for such party here set forth by giving notice of such change to the other parties pursuant to this Section.

IN WITNESS WHEREOF , the Company has caused this amendment and restatement to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
Marcia Avedon
Senior Vice President

Exhibit 10.54

IR EXECUTIVE DEFERRED COMPENSATION PLAN II

[As Amended and Restated Effective January 1, 2009]

TABLE OF CONTENTS


SECTION 1 - STATEMENT OF PURPOSE		1

SECTION 2 - DEFINITIONS

2.1	Account Balance	2
2.2	Administrative Committee	2
2.3	Base Salary	2
2.4	Beneficiary	2
2.5	Beneficiary Designation Form	2
2.6	Cash Incentive Compensation Award	2
2.7	Change in Control	2
2.8	Code	2
2.9	Compensation Committee	2
2.10	Deferral Account	3
2.11	Deferral Amount	3
2.12	Disability	3
2.13	Discretionary Company Contribution	3
2.14	Discretionary Company Contribution Account	3
2.15	Dividends on Stock Grants	3
2.16	Elected Officer	3
2.17	Election Form	4
2.18	Eligible Employee	4
2.19	ERISA	4
2.20	Investment Option Subaccounts	4
2.21	IR Stock	4
2.22	IR Stock Account	4
2.23	Participant	4
2.24	Participating Employer	4
2.25	Plan Year	4
2.26	Retirement	4
2.27	Return	5
2.28	Separation from Service	5
2.29	Service	5
2.30	Stock Based Awards	5
2.31	Stock Grant	5
2.32	Supplemental Contribution	5
2.33	Supplemental Contribution Account	5
2.34	Trust	5
2.35	Unforeseeable Financial Emergency	6

SECTION 3 – ADMINISTRATION OF THE PLAN		6

(i)


SECTION 4 - PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION

4.1	Participation and Deferral Election	6
4.2	Investment Election	8
4.3	Duration of Elections	9

SECTION 5 - VESTING

5.1	Deferral Amounts	9
5.2	Supplemental Contributions	9
5.3	Discretionary Contributions	9

SECTION 6 - ACCOUNTS AND VALUATIONS

6.1	Deferral Accounts	10
6.2	Supplemental Contribution Accounts	10
6.3	Discretionary Contribution Accounts	11
6.4	IR Stock Accounts	12
6.5	Changes in Capitalization	13
6.6	Accounts are Bookkeeping Entries	13

SECTION 7 - DISTRIBUTION OF ACCOUNTS

7.1	Separation from Service with Five Years of Service, etc.	14
7.2	Scheduled Distributions Prior to Separation from Service	15
7.3	Separation from Service Prior to Completing Five (5) Years of Service	16
7.4	Unforeseeable Financial Emergency Distribution	16
7.5	Required Delay in Distributions	17
7.6	Prohibition of Accelerations	17
7.7	Medium of Payments	17
7.8	Taxes; Withholding	17
7.9	Distribution Provisions	18
7.10	Treatment of Installments; Date of Distribution	18
7.11	Timing of Initial Election Forms	18
7.12	Distribution of Certain Multi-Year Compensation	18

SECTION 8 - BENEFICIARY DESIGNATION		19

SECTION 9 - AMENDMENT AND TERMINATION OF PLAN

9.1	Amendment	19
9.2	Termination of Plan	19

(ii)


SECTION 10 - MISCELLANEOUS
10.1	Unsecured General Creditor	20
10.2	Entire Agreement; Successors	20
10.3	Non-Assignability	21
10.4	No Contract of Employment	21
10.5	Authorization and Source of Shares	21
10.6	Singular and Plural	21
10.7	Captions	21
10.8	Applicable Law	21
10.9	Severability	21
10.10	Notice	21

(iii)

IR Executive Deferred Compensation Plan II

As Amended and Restated Effective January 1, 2009

SECTION 1

STATEMENT OF PURPOSE

The purpose of the IR Executive Deferred Compensation Plan II (the “Plan”) is to further increase the mutuality of interest between Ingersoll-Rand Company (the “Company”), its employees, the employees of a Participating Employer and members of Ingersoll-Rand Company Limited by providing a select group of management and highly compensated employees of the Company or a Participating Employer the opportunity to elect to defer receipt of cash compensation. The Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA. To the extent Code Section 409A applies to the Plan, the terms of the Plan are intended to comply with that provision, and the terms of the Plan shall be interpreted and administered in accordance therewith.

The Plan is a successor to the IR Executive Deferred Compensation Plan (the “Predecessor Plan”). The Predecessor Plan, which previously was known as the Ingersoll-Rand Company Executive Deferred Compensation and Stock Bonus Plan, became effective on January 1, 1997, was amended and restated effective January 1, 2001.

The Company amended and restated the Plan in its entirety, effective August 1, 2007, to conform the terms of the Plan to the requirements of the regulations under Code Section 409A. This further amendment and restatement is effective January 1, 2009. The Plan applies to (i) amounts initially deferred hereunder on or after January 1, 2005, (ii) amounts initially credited to the Predecessor Plan before January 1, 2005 that, pursuant to the effective-date rules of Code Section 409A, are subject to the provisions of Code Section 409A, and (iii) investment earnings allocable to amounts described in (i) and (ii). Notwithstanding any other provision of this Plan, no amount will be deferred or credited under this Plan with respect to a Participant for a Plan Year if such amount is properly deferred or credited with respect to such Participant for such Plan Year under the Predecessor Plan.

SECTION 2

DEFINITIONS

2.1

2.2	“Administrative Committee” shall mean the committee appointed by the Chief Executive Officer of the Company which will administer the Plan in accordance with the duties delegated to it by the Compensation Committee or as set forth herein.

2.3

2.4	“Beneficiary” means the person or persons designated as such in accordance with Section 8.

2.5	“Beneficiary Designation Form” means the form established from time to time by the Administrative Committee that a Participant completes and returns to the Administrative Committee to designate one or more Beneficiaries.

2.6	“Cash Incentive Compensation Award” means any of the Participant’s annual cash incentive compensation awards.

2.7

“Change in Control” means a “change in control of the Company” (as set forth in the Company’s Incentive Stock Plan of 2007), unless a different definition is used for purposes of any severance of employment agreement or change of control arrangement between the Company and a Participant, in which event such definition shall apply. Solely for purposes of this Section 2.7, the term “Company” shall mean Ingersoll-Rand Company Limited.

2.8	“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations and other administrative guidance issued thereunder.

2.9	“Compensation Committee” means the Compensation Committee of the Board of Directors of Ingersoll-Rand Company Limited.

2.10

2.11	“Deferral Amount” means the amount of a Participant’s Cash Incentive Compensation Award, Base Salary, Stock Based Awards, and (for periods prior to August 2, 2006) Dividends on Stock Grants actually deferred under the Plan by the Participant pursuant to Section 4 for any one Plan Year.

2.12

“Disability” means, with respect to a Participant: (a) a condition under which the Participant: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months; or (ii) is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company or a Participating Employer; or (b) any other condition under which the Participant is considered “disabled” within the meaning of Code Section 409A(a)(2)(C).

2.13	“Discretionary Company Contribution” means an additional amount to be credited to a Participant’s Discretionary Company Contribution Account for a Plan Year.

2.14

2.15

“ Dividends on Stock Grants ” means the dividends on deferred vested Stock Grants payable to a Participant pursuant to the Ingersoll-Rand Company Incentive Stock Plan of 1995 or the Ingersoll-Rand Company Incentive Stock Plan of 1998 or any successor plan thereto. Notwithstanding the foregoing, effective August 2, 2006, no additional Dividends on Stock Grants shall be credited under the Plan with respect to any Participant.

2.16	“ Elected Officer ” means an officer of the Company elected to such position by the Board of Directors of the Company.

2.17

“Election Form” means the form or forms established from time to time by the Administrative Committee that a Participant completes, signs and returns to the Administrative Committee or to the Plan’s recordkeeper to make an election under the Plan. An Election Form also includes any other method approved by the Administrative Committee, in its sole and absolute discretion, that a Participant may use to make an election under the Plan. The terms and conditions specified in the Election Form(s) are incorporated by reference herein and form a part of the Plan. If there is a conflict between the Election Form and the Plan, the terms of the Plan shall control and govern.

2.18

2.19	“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

2.20

2.21	“IR Stock ” means the Class A common shares, par value $1.00 per share, of Ingersoll-Rand Company Limited, a Bermuda company.

2.22

2.23	“Participant” means an Eligible Employee participating in the Plan in accordance with the provisions of Section 4.

2.24	“Participating Employer” means any direct or indirect parent, subsidiary or affiliate of the Company that is aggregated with the Company for purposes of Code Section 409A.

2.25	“Plan Year” means a calendar year.

2.26	“Retirement” means, with respect to a Participant, Separation from Service after he or she has attained age 65 (62 for Elected Officers) or Separation from Service with at least five (5) years of Service.

2.27	“Return” means, for each investment option, an amount equal to the net investment return (including changes in value and distributions) for each such investment option during each business day.

2.28	“ Separation from Service” means a separation from service under the general rules under Code Section 409A.

2.29	“Service” means periods of service with the Company or a Participating Employer as determined in accordance with Section 2.3 of the Ingersoll Rand Pension Plan Number One.

2.30

“Stock Based Awards” means awards, in lieu of any incentive or variable compensation to which a Participant is entitled from the Company or its subsidiaries or ERISA affiliates, of (i) Class A common shares of Ingersoll-Rand Company Limited, or (ii) restricted Class A common shares of Ingersoll-Rand Company Limited, or (iii) awards that are valued in whole, or in part, by reference to, or otherwise based on the fair market value of Class A common shares of Ingersoll-Rand Company Limited.

2.31	“Stock Grant” means a grant of IR Stock made to a Participant under the Company’s stock grant plan, which was frozen in February of 2000.

2.32

2.33

2.34	“ Trust ” means the Ingersoll-Rand Company Deferred Compensation Trust Agreement, dated as of January 1, 2001 between the Company and the trustee named therein, as amended from time to time.

2.35

“Unforeseeable Financial Emergency” means: (a) a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152(a)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant; or (b) such other definition of “unforeseeable emergency” within the meaning of Code Section 409A(a)(2)(B)(ii).

SECTION 3

ADMINISTRATION OF THE PLAN

SECTION 4

PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION.

4.1	Participation and Deferral Election . Any Eligible Employee may elect to participate in the Plan for a given Plan Year by filing a completed Election Form for the Plan Year in the manner prescribed by the Administrative Committee. The

Election Form must specify the percentage or dollar amount of any Deferral Amount otherwise payable for or during such Plan Year that will be deferred under the Plan. No Election Form shall be accepted by the Administrative Committee unless it provides that the Participant has elected to defer a combination of cash compensation and/or Stock Based Award equal to a minimum of $5,000.

Any election to defer a Deferral Amount for a Plan Year is irrevocable upon the filing of the Election Form, and must be properly completed and filed by the Participant no later than the December 31 immediately preceding the first Plan Year during which the services for which the compensated is paid or awarded are performed or:

(a)

In the case of a new Participant who is described in Code Section 409A(a)(4)(B)(ii), the 30th day after such new Participant first becomes eligible to participate in the Plan (provided that such election shall relate only to compensation for services performed subsequent to the date such Election Form is filed);

(b)

In the case of any compensating award that constitutes performance-based compensation for purposes of Code Section 409A; the June 30 immediately preceding the Plan Year in which such award would otherwise be paid or such earlier date established by the Administrative Committee; if, by reason of events occurring after the Participant’s Deferral Election, compensation ceases to be performance-based compensation for purposes of section 409A, any deferral election made under this paragraph (and not timely made under any other provision of this Section 4.1) shall be considered untimely and given no force or effect;

(c)

In the case of any compensatory award that, at the time the Participant obtains a legally binding right to the award, is subject to a substantial risk of forfeiture (within the meaning of Code Section 409A) for a period of at least 13 months, the 30th day after the Participant obtains a legally binding right to such award.

An Eligible Employee who fails to file a properly completed Election Form by the applicable date indicated above will be ineligible to defer under the Plan the Deferral Amount to which such applicable date relates. In addition, the Administrative Committee, in its sole and absolute discretion, may establish from time to time such other enrollment requirements as it determines are necessary or proper.

4.2

Notwithstanding any other provision of this Section 4.2, in no event may a Participant designate that any Base Salary deferred under the Plan or any earnings thereon be deemed to be invested in IR Stock, and in no event may a Participant designate that any Stock Based Awards or earnings thereon be deemed to be invested other than in IR Stock.

Except for Discretionary Company Contributions that the Administrative Committee, pursuant to Section 6.3, has directed the investment options in which a Participant’s Discretionary Company Contributions shall be deemed to be invested, if a Participant fails to elect a type of investment option under this Section, he or she shall be deemed to have elected the investment option designated by the Administrative Committee as the default investment option.

4.3

Duration of Elections. Notwithstanding anything to the contrary: (a) any election under Section 4.1 (including a failure to make an election) shall remain in effect from Plan Year to Plan Year unless a written request to modify or terminate that election for a subsequent Plan Year is submitted to the Administrative Committee in accordance with Section 4.1; and (b) any election under Section 4.2 (including a failure to make an election) shall remain in effect from Plan Year to Plan Year unless a written request to modify or terminate that election is submitted to the Administrative Committee, which request shall be effective as to any Deferral Amount credited to the Participant’s Deferral Account 30 or more days after such written request is submitted to the Administrative Committee; provided that nothing in this Section 4.3(b) shall permit a Participant to make such a written request as to the deemed investment of Stock Based Awards.

SECTION 5

VESTING

5.1.	Deferral Amounts . A Participant shall be fully vested in his or her Deferral Account.

5.2.

Supplemental Contributions . A Participant shall vest in his or her Supplemental Contribution Account on the earliest of: (i) the fifth anniversary of the date the Supplemental Contribution is credited to the Participant’s Supplemental Contribution Account; (ii) the date of the Participant’s Retirement; (iii) the Participant’s Disability; (iv) the Participant’s death; (v) a Change in Control; or (vi) a termination of the Plan pursuant to Section 9.2. Notwithstanding the foregoing, effective August 2, 2006, a Participant shall be fully vested in his or her Supplemental Contribution Account.

5.3.	Discretionary Contributions. A Participant shall vest in his or her Discretionary Company Contribution Account on the earliest of: (i) the date determined by the Administrative Committee; (ii) the date of the Participant’s Disability; (iii) the

date of the Participant’s death; (iv) a Change in Control; or (v) a termination of the Plan pursuant to Section 9.2. Notwithstanding the above, to the extent an agreement between the Company and the Participant contains provisions governing vesting with regards to a Discretionary Company Contribution made on behalf of the Participant, the terms of such agreement shall apply.

SECTION 6

ACCOUNTS AND VALUATIONS

6.1

Deferral Accounts . The Administrative Committee shall establish and maintain a separate Deferral Account for each Participant for each Plan Year. All Deferral Amounts, other than Stock Based Awards and Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s Deferral Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Stock Based Awards and Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account as described in Section 6.4.

Each Participant’s Deferral Accounts shall be divided into Investment Option Subaccounts. A Participant’s Deferral Accounts shall be credited as follows:

(a)

(b)

6.2

Supplemental Contributions shall be credited to a Participant’s Supplemental Contribution Account. All of a Participant’s Supplemental Contributions shall be deemed to be invested in, and shall remain deemed to be invested in, IR Stock in the Participant’s Supplemental Contribution Account until such amounts are distributed from the Plan.

6.3

(a)

(b)

6.4

IR Stock Accounts . The Administrative Committee shall establish and maintain a separate IR Stock Account for each Plan Year for each Participant who (i) elects to have all or a portion of his of her Deferral Amounts and/or Discretionary Company Contributions for such Plan Year invested in IR Stock, (ii) elects to defer Stock Based Awards pursuant to Section 4.1, or (iii) receives a Discretionary Company Contribution which is directed, pursuant to Section 6.3, by the Administrative Committee to be deemed to be invested in IR Stock. All Deferral Amounts that are deemed, at the Participant’s election, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account on the date when the Deferral Amount would otherwise be paid to the Participant. All Stock Based Awards shall be credited to a Participant’s IR Stock Account at the time such Stock Based Awards become vested. All Discretionary Company Contributions that are deemed, whether at the Participant’s election or as directed by the Administrative Committee, to be invested in IR Stock shall be credited to the Participant’s IR Stock Account on the date determined by the Administrative Committee in its sole and absolute discretion. Notwithstanding anything to the contrary, IR Stock credited to a Participant’s IR Stock Account may not be designated by the Participant to be deemed to be invested in any other investment option and shall remain invested in IR Stock in such IR Stock Account until distributed from the Plan. A Participant’s IR Stock Accounts shall be credited as follows:

(a)

(b)

All Deferral Amounts and Discretionary Company Contributions deemed to be invested in IR Stock in accordance with the Participant’s Election Form or, with respect to Discretionary Company Contributions as directed by the Administrative Committee, shall be credited to a Participant’s IR Stock Account in units or fractional units. The value of each unit shall be determined each business day and shall equal the closing price of one share of IR Stock on the New York Stock Exchange-Composite Tape. On each date that Deferral Amounts and/or Discretionary Company Contributions are credited to the Participant’s IR Stock Account, the number of units to be credited shall be determined by dividing the amount of such Deferral Amounts and/or Discretionary Company Contributions by the value of a unit on such date.

6.5

Changes in Capitalization . If there is any change in the number or class of shares of IR Stock through the declaration of a stock dividend or other extraordinary dividends, or recapitalization resulting in stock splits, or combinations or exchanges of such shares or in the event of similar corporate transactions, the units in each Participant’s IR Stock Account and Supplemental Contribution Account shall be equitably adjusted to reflect any such change in the number or class of issued shares of IR Stock or to reflect such similar corporate transaction.

6.6

Accounts are Bookkeeping Entries . Notwithstanding any other provision of the Plan that may be interpreted to the contrary, the investment options, including IR Stock, are to be used for measurement purposes only, and a Participant’s election of any such investment option, the allocation to his or her Account Balances thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balances shall not be considered or construed in any manner as an actual investment of his or her Account Balances in any such investment option. In the event that the Company or the trustee of the Trust, in its own discretion, decides to invest funds in any or all of the investment options, no Participant shall have any rights in or to such investments themselves. Without limiting the foregoing, a Participant’s Account Balances shall at all times be a

bookkeeping entry only and shall not represent any investment made on the Participant’s behalf by the Company or the Trust. The Participant shall at all times remain an unsecured creditor of the Company.

SECTION 7

DISTRIBUTION OF ACCOUNTS

7.1

Separation from Service with Five Years of Service, Retirement, Disability and Death . Except as otherwise provided in this Section 7, a Participant who has a Separation from Service after completing at least five (5) years of Service, has a Retirement, incurs a Disability, or dies shall be paid his or her vested Account Balances (and after his or her death to his or her Beneficiary) in a lump sum in the Plan Year following the Participant’s Separation from Service, Retirement, Disability or death, unless an optional time or form of benefit payment has been elected by the Participant in accordance with the next sentence. For each Plan Year’s Account Balance the Participant may elect, on an initial Election Form filed in accordance with Section 4.1 by the time specified in Section 7.11, an optional form of benefit payment from among the following:

(1)

Annual installments over five (5) years commencing in the Plan Year following the Participant’s Separation from Service, Retirement, Disability or death;

(2)

Annual installments over ten (10) years commencing in the Plan Year following the Participant’s Separation from Service, Retirement, Disability or death;

(3)

Annual installments over fifteen (15) years commencing in the Plan Year following the Participant’s Separation from Service, Retirement, Disability or death; and

(4)

A lump sum distribution payable in the Plan Year specified by the Participant on such Election Form; provided, however, that such specified date shall be no less than one (1) year and no more than five (5) years following the Participant’s Separation from Service, Retirement, Disability or death.

(other than an election related to a distribution payable by reason of Disability or death) shall be effective unless it defers by a period of at least five years the date on which such distribution would otherwise be made or begin; and (iii) no such election related to a distribution payable at a specified time or pursuant to a fixed schedule (within the meaning of Code Section 409A(a)(2)(A)(iv)) may be made within twelve months of the date such distribution would otherwise be made. As and to the extent required under Code Section 409A(a)(4)(C), the first day of the Plan Year in which a distribution would otherwise be made or begin (but for an election made by the Participant under this paragraph) shall be treated as the date the distribution would otherwise be made or begin for purposes of the rules set forth in the preceding sentence.

In the event of the Participant’s Separation from Service with five (5) years of Service, Retirement, Disability or death prior to the elected date for one or more scheduled distributions under Section 7.2, the portion of the Participant’s Account Balance associated with such distribution(s) shall be paid to the Participant (and after his or her death to his or her Beneficiary) at the time and in the form determined under this Section 7.1.

Notwithstanding any provision of the Plan to the contrary, if a Participant has a Separation from Service after completing five (5) years of Service, has a Retirement, incurs a Disability or dies while receiving annual installments pursuant to Section 7.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not a Separation from Service or Retirement, incurred a Disability or died.

All distributions under this Section 7.1 shall be made on a pro rata basis from the Participant’s Account Balances.

7.2

Scheduled Distributions Prior to Separation from Service . For each Plan Year’s Account Balance, a Participant may elect, on an initial Election Form filed in accordance with Section 4.1 by the time specified in Section 7.11, to receive a distribution of all or a portion of his or her Deferral Account, IR Stock Account, vested Discretionary Company Contribution Account and vested Supplemental Contribution Account with respect to a Plan Year(s) while still employed by the Company. A Participant’s election for a distribution under this Section 7.2 shall be permitted only if the date specified on the Election Form by the Participant for such distribution (in the event of a lump sum) or the commencement of such distribution (in the event of annual installments) is no earlier than two (2) years from the last day of the Plan Year for which the portion of the Deferral Account, IR Stock Account, vested Discretionary Company Contribution Account, and vested Supplemental Contribution Account to be distributed is actually deferred. At the time an election for a distribution under this Section is made, the Participant shall also elect, on the Election Form, the form of payment of the distribution. The Participant shall elect either (i) a lump sum payment to be paid

in the Plan Year specified by the Participant on the Election Form or (ii) annual installments over two (2), three (3), four (4) or five (5) years beginning in the Plan Year specified by the Participant on the Election Form.

All distributions under this Section 7.2 shall be made on a pro rata basis from the Participant’s Deferral Account(s), IR Stock Account(s), vested Discretionary Company Contribution Account(s), and vested Supplemental Contribution Account(s), as applicable.

7.3

Separation from Service Prior to Completing Five (5) Years of Service . Except as otherwise provided in Section 7.5, if a Participant has a Separation from Service other than by reason of Retirement, Disability or death prior to his or her completing five (5) years of Service, the vested portion of the Participant’s Account Balances, if any, shall be distributed in a lump sum in the Plan Year following the Participant’s Separation from Service. If a Participant has a Separation from Service other than by reason of Retirement, Disability or death prior to his or her completing five (5) years of Service while receiving annual installments pursuant to Section 7.2, such annual installments shall continue to be paid to the Participant (and after his or her death to his or her Beneficiary) in the same manner as if the Participant had not Separated from Service prior to completing five (5) years of Service.

7.4

Unforeseeable Financial Emergency Distribution . In the event that the Administrative Committee, upon written petition of the Participant on an Election Form filed with the Administrative Committee specifying the Plan Year(s) with respect to which payment shall be made, determines in its sole and absolute discretion, that the Participant has suffered an Unforeseeable Financial Emergency, the Company shall pay to the Participant (or the Participant’s Beneficiary) in a lump sum from the Participant’s Deferral Account(s), IR Stock Account(s), vested portion of the Discretionary Company Contribution Account(s) and the vested portion of the Supplemental Contribution Account(s)

with respect to the specified Plan Year(s), as soon as practicable following such determination, the amount necessary to satisfy such Unforeseeable Financial Emergency plus the amount necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which the Unforeseeable Financial Emergency is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

All distributions under this Section 7.4 shall be made on a pro rata basis from the Participant’s Deferral Account(s), IR Stock Account(s), vested Discretionary Company Contribution Account(s) and vested Supplementary Contribution Account(s), as applicable.

7.5

Required Delay in Distributions . Notwithstanding any other provision of this Plan to the contrary, no distribution shall be made to a Participant who is a “specified employee,” as determined by the Company through procedures consistent with and permitted under Code Section 409A(a)(2)(B)(i), by reason of such Participant’s Separation from Service or Retirement prior to the date that is six months after such Participant’s Separation from Service or Retirement. Any amounts that would otherwise be paid during the six-month period following such Participant’s Separation from Service or Retirement shall be paid on the first date such amount may be paid under the preceding provisions of this Section 7.5.

7.6	Prohibition of Accelerations. Except to the extent that the Company is permitted under Code Section 409A(a)(3) to exercise discretion to accelerate distributions under the Plan, the time or schedule of any distribution hereunder shall not be accelerated.

7.7

Medium of Payments. All amounts in a Participant’s Deferral Account and Discretionary Company Contribution Account and payable to a Participant or Beneficiary under the Plan shall be paid in cash. All amounts in a Participant’s Supplemental Contribution Account and IR Stock Account and payable to a Participant or Beneficiary under the Plan shall be paid in IR Stock.

7.8

7.9

Distribution Provisions. To the extent an agreement between the Company and a Participant contains provisions governing the form and/or timing of a distribution of a Discretionary Company Contribution made on behalf of the Participant, the distribution provisions of such agreement shall apply to the extent such provisions are not inconsistent with the requirements of Code Section 409A.

7.10

Treatment of Installments; Date of Distribution . For purposes of Code Section 409A, any series of installment payments payable to or with respect to a single Participant shall be treated as a single payment under the Plan. Any distribution due under the Plan shall be made by the last day of the Plan Year in which such distribution, disregarding this sentence, is due under the Plan (determined after the application of Section 7.5) or such other date as may be permitted or required under Code Section 409A.

7.11

Timing of Initial Election Forms. Any election made on an initial Election Form (but not a subsequent Election Form) referenced in Section 7.1 or 7.2 that applies to a Deferral Amount or a Discretionary Company Contribution shall be irrevocable (except to the extent such election is subject to a subsequent election under Section 7.1 or 7.2 as permitted by Code Section 409A(a)(4)(C)) and must be made no later than the election deadline that applies under Section 4.1 to such Deferral Amount or, in the case of a Discretionary Company Contribution, December 31 of the Plan Year preceding the Plan Year in which the Participant performs the services to which such Discretionary Company Contribution relates.

7.12

Distribution of Certain Multi-Year Compensation. Notwithstanding the prior provisions of this Section 7, in the case of any compensation that (absent the Participant’s Deferral Election) would have been paid in a Plan Year that was specified by the Company at the time of the Participant’s Deferral Election, the Deferral Amount shall be paid (or commence to be paid) no earlier than such Plan Year. For example, if the Company awards performance-based compensation payable in the Plan Year following a three-year performance cycle, and a Participant has made a timely election to defer such compensation until the Plan Year following Separation from Service, such compensation shall be distributed in the later of the Plan Year following Separation from Service or the Plan Year following the three-year performance cycle. The Participant’s Deferral Election shall be deemed to incorporate the requirement of this Section 7.12, whether or not it expressly so provides.

SECTION 8

BENEFICIARY DESIGNATION

A Participant shall have the right to designate a Beneficiary(ies) to receive the Participant’s Account Balances in the event the Participant dies prior to receiving all of his or her Account Balances. A Beneficiary designation shall be made, and may be amended at any time, by the Participant by filing a written designation with the Administrative Committee, on such form and in accordance with such procedures as the Administrative Committee shall establish from time to time. A Participant may change the designated Beneficiary under the Plan at any time by providing such designation in writing to the Administrative Committee.

SECTION 9

AMENDMENT AND TERMINATION OF PLAN

9.1

Amendment. The Plan may, at any time and from time to time, be amended without the consent of any Participant or Beneficiary, by (a) the Compensation Committee or the Board of Directors of Ingersoll-Rand Company Limited or (b) the Administrative Committee in the case of amendments which do not materially modify the provisions hereof; provided, however, that no amendment shall reduce any benefits accrued under the terms of the Plan as of the date of amendment.

9.2	Termination of Plan

Company’s Right to Terminate. The Board of Directors of Ingersoll-Rand Company Limited may terminate the Plan at any time and for any reason.

Company’s termination and liquidation of the Plan, provided that: (1) the termination and liquidation do not occur proximate to a downturn in the financial health of the Company; (2) the Company terminates and liquidates all agreements, methods, programs, and other arrangements sponsored by the Company that would be aggregated with the Plan and any other terminated and liquidated agreements, methods, programs, and other arrangements under Code Section 409A if the Participant had deferrals of compensation under all the agreements, methods, programs, and other arrangements that are terminated and liquidated; (3) no payments in liquidation of the Plan are made within 12 months of the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan other than payments that would be payable under the terms of the Plan if the action to terminate and liquidate the Plan had not occurred; (4) all payments are made within 24 months of the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan; and (5) the Company does not adopt a new plan that would be aggregated with the Plan or any other terminated and liquidated plan under Code Section 409A if the Participant participated in both plans, at any time within three years following the date the Company takes all necessary action irrevocably to terminate and liquidate the Plan.

SECTION 10

MISCELLANEOUS

10.1

Unsecured General Creditor . Benefits under the Plan shall be payable by the Company out of its general funds. The Company shall have the right to establish a reserve or make any investment for the purposes of satisfying its obligations hereunder for payment of benefits at its discretion, provided, however, that no Participant or Beneficiary shall have any interest in such investment or reserve. To the extent that any person acquires a right to receive benefits under the Plan, such rights shall be no greater than the right of any unsecured general creditor of the Company. No Participant shall have any rights or privileges of a stockholder of the Company or of a member of Ingersoll-Rand Company Limited under the Plan, including as a result of the crediting of units to a Participant’s IR Stock Account or Supplemental Contribution Account, except at such time as distribution is actually made from the Participant’s IR Stock Account or Supplemental Contribution Account, as applicable.

10.2

and any amendment hereof shall be binding on the Company and the Participants and, their respective heirs, administrators, trustees, successors and assigns, including but not limited to, any successors of the Company by merger, consolidation or otherwise by operation of law, and on all designated Beneficiaries of the Employee.

10.3

10.4

10.5

Authorization and Source of Shares . Shares of IR Stock necessary to meet the obligations of the Plan have been reserved and authorized pursuant to resolutions adopted by the Board of Directors of the Company on December 4, 1996, and additional shares of IR Stock shall be reserved and authorized for delivery under the Plan from time to time. These shares of IR Stock may be provided from newly-issued or treasury shares.

10.6	Singular and Plural . As the context may require, the singular may be read as the plural and the plural as the singular.

10.7	Captions . The captions to the articles, sections, and paragraphs of the Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

10.8	Applicable Law . Except as preempted by federal law, the Plan shall be governed and construed in accordance with the laws of the State of New Jersey.

10.9	Severability . If any provisions of the Plan shall, to any extent, be invalid or unenforceable, the remainder of the Plan shall not be affected thereby, and each provision of the Plan shall be valid and enforceable to the fullest extent permitted by law.

10.10

receipt for registration or certification. Any notice to the Participant shall be addressed to the Participant at the Participant’s residence address as maintained in the Company’s records. Any party may change the address for such party here set forth by giving notice of such change to the other parties pursuant to this Section.

IN WITNESS WHEREOF , the Company has caused this amendment and restatement to be executed by its duly authorized representative on this 22nd day of December, 2008.


INGERSOLL-RAND COMPANY

By:		/s/ Marcia J. Avedon
Marcia Avedon
Senior Vice President

Exhibit 10.55

I NGERSOLL -R AND C OMPANY L IMITED

I NCENTIVE S TOCK P LAN OF 2007

S TOCK O PTION G RANT

D ATED AS OF F EBRUARY 12, 2009

Ingersoll-Rand Company Limited (the “Company”) hereby grants to [insert name] (“Participant”) a non-qualified stock option (the “Option”) to purchase [insert number of shares subject to Option] shares of the Company’s common stock (the “Shares”) at an exercise price of US$ [insert option price] per Share, pursuant to and subject to the terms and conditions set forth in the Company’s Incentive Stock Plan of 2007 (the “Plan”) and to such further terms and conditions set forth below. Unless otherwise defined herein, the terms defined in the Plan shall have the same meanings in this grant document.

1. Non-Qualified Stock Option. The option to purchase shares of Common Stock pursuant to the Option is granted as a “non-qualified stock option” within the meaning of the Code.

2. Vesting and Exercisability . Participant’s right to purchase Shares subject to the Option shall vest in three equal installments on each of the first three anniversaries of the date of grant, subject to Participant’s continued employment with the Company or an Affiliate on each such anniversary. Subject to the provisions below, the term of the Option shall be ten years from the date of grant. Participant’s rights with respect to the Option after termination of Participant’s employment shall be as set forth below:

(a) If Participant’s employment terminates by reason of voluntary resignation or a performance based termination, (including, but not limited to, poor performance or fit with the Company and/or an Affiliate or behavior or results that are incompatible with continued employment), Participant’s right to exercise vested Options will expire 90 days following termination of active employment and all unvested options shall be cancelled as of the date of termination of active employment;

(b) If Participant’s employment terminates involuntarily by reason of a group termination (including, but not limited to, terminations resulting from sale of a business or division, outsourcing of an entire function, reduction in workforce or closing of a facility (a “Group Termination Event”)), any unvested Options that would have vested within 12 months following such termination of active employment shall become fully vested, all other unvested Options shall be cancelled as of the date of termination of active employment and all vested Options shall remain exercisable for three years following termination of active employment;

(c) If Participant’s employment terminates involuntarily by reason of job elimination, substantial change in the nature of Participant’s position or job relocation, Participant shall have one year from the date of termination of active employment to exercise vested Options and all unvested options will be cancelled as of the date of termination of active employment;

(d) If Participant’s employment terminates due to death or disability, all unvested Options shall continue to vest according to their original vesting schedule and vested Options shall remain exercisable for three years following termination of employment;

(e) Notwithstanding the provisions of (a) through (d) above, if Participant’s employment terminates after attainment of age 55 with at least 5 years of service (“Retirement”), all unvested Options shall continue to vest according to their original vesting schedule and Participant shall have 5 years from the date of termination of active employment to exercise all vested Options;

(f) In the event Participant’s employment is terminated for cause (including fraud, malfeasance, felony conviction or violation of Company’s Code of Conduct), all Options, whether vested or unvested, shall be cancelled immediately;

(g) In no event shall any portion of the Options be exercisable more than ten years after the date of grant.

3. Electronic Delivery and Participation . The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan by electronic means.

Signed for and on behalf of the Company:

Herbert L. Henkel

Chairman & Chief Executive Officer

Ingersoll-Rand Company Limited

This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933.

Exhibit 10.56

I NGERSOLL -R AND C OMPANY L IMITED

I NCENTIVE S TOCK P LAN OF 2007

R ESTRICTED S TOCK U NIT G RANT

D ATED AS OF F EBRUARY 12, 2009

Ingersoll-Rand Company Limited (the “Company”) hereby grants to [insert name] (“Participant”) a restricted stock unit award (the “RSUs”) with respect to [insert number of shares subject to RSUs] shares of the Company’s common stock (the “Shares”), pursuant to and subject to the terms and conditions set forth in the Company’s Incentive Stock Plan of 2007 (the “Plan”) and to such further terms and conditions set forth below. Unless otherwise defined herein, the terms defined in the Plan shall have the same meanings in this grant document.

1. Vesting and Issuance of Shares; Dividend Equivalents .

(a) Participant’s right to receive Shares subject to the RSUs shall vest in three equal installments on each of the first three anniversaries of the date of grant (each anniversary being a “Vesting Date”), subject to Participant’s continued employment with the Company or an Affiliate on each such anniversary. Except as provided in Sections 1(d) and 1(e) below, no RSUs shall vest following Participant’s separation from service (within the meaning of Section 409A(a)(2)(A)(i) of the Code).

(b) Participant shall be entitled to receive an amount equal to any cash dividend paid by the Company upon one Share for each RSU held by Participant when such dividend is paid (“Dividend Equivalent”), provided that, (i) Participant shall have no right to receive the Dividend Equivalents unless and until the associated RSUs vest, (ii) Dividend Equivalents shall not accrue interest and (iii) Dividend Equivalents shall be paid in cash at the time that the associated RSUs vest.

(c) If Participant’s employment terminates involuntarily by reason of a group termination (including, but not limited to, terminations resulting from sale of a business or division, outsourcing of an entire function, reduction in workforce or closing of a facility (a “Group Termination Event”)), the number of Shares subject to the RSUs that would have vested within 12 months of Participant’s termination of active employment shall vest as of the date of termination of active service (such date also being a “Vesting Date”) and all other RSUs and associated Dividend Equivalents shall be forfeited as of the date of termination of active employment and Participant shall have no right to or interest in such RSUs, the underlying Shares or any associated Dividend Equivalents.

(d) If Participant’s employment terminates by reason of death or disability, the Shares subject to the RSUs shall continue to vest according to the schedule set forth in Section 1(a), notwithstanding such termination of employment.

(e) If Participant’s employment terminates after attainment of age 55 with at least 5 years of service (“Retirement”), the Shares subject to the RSUs shall continue to vest according to the schedule set forth in Section 1(a), notwithstanding such termination of employment.

(f) If Participant’s employment terminates for any reason other than those specified in Sections 1(c), (d) and (e) above, all unvested RSUs and associated Dividend Equivalents shall be forfeited as of the date of termination of active employment and Participant shall have no right to or interest in such RSUs, the underlying Shares or any associated Dividend Equivalents.

(g) On or as soon as administratively practicable following each Vesting Date, the Company shall cause to be issued to Participant Shares with respect to the RSUs that become vested on such Vesting Date. Participant will not have any of the rights or privileges of a shareholder of the Company in respect of any Shares subject to the RSUs unless and until such Shares have been issued to Participant.

2. Taxes . Regardless of any action the Company and/or an Affiliate take with respect to any and all federal, state, local or other tax related to Participant’s participation in the Plan and legally applicable to Participant (“Tax-Related Items”), Participant acknowledges that the ultimate liability for all Tax-Related Items is and remains Participant’s responsibility. To satisfy any withholding obligations of the Company or an Affiliate with respect to Tax-Related Items, the Company will withhold Shares otherwise issuable upon vesting of the RSUs. To avoid negative accounting treatment, the Company may withhold for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates. Alternatively, or in addition, the Company may satisfy such withholding obligations by (a) withholding from Participant’s wages or other cash compensation paid to Participant by the Company or an Affiliate, (b) withholding from proceeds of the sale of Shares acquired upon vesting of the RSUs either through a voluntary sale or through a mandatory sale arranged by the Company (on Participant’s behalf pursuant to this authorization), or (c) requiring Participant to tender a cash payment to the Company or an Affiliate in the amount of the Tax-Related Items. The Company may refuse to deliver the Shares or the proceeds of the sale of Shares, if Participant fails to comply with his or her obligations in connection with the Tax-Related Items.

3. Electronic Delivery and Participation . The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan by electronic means.

Signed for and on behalf of the Company:

Herbert L. Henkel

Chairman & Chief Executive Officer

Ingersoll-Rand Company Limited

This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933.

Exhibit 10.57

I NGERSOLL -R AND C OMPANY L IMITED

I NCENTIVE S TOCK P LAN OF 2007

P ERFORMANCE S TOCK U NIT G RANT

F OR THE 2009-2010 P ERFORMANCE P ERIOD

D ATED AS OF F EBRUARY 12, 2009

Ingersoll-Rand Company Limited (the “Company”) hereby grants to «NAME» (“Participant”) a performance stock unit award (the “PSUs”) pursuant to and subject to the terms and conditions set forth in the Company’s Incentive Stock Plan of 2007 (the “Plan”), including the terms and conditions for Performance-Based Awards as set forth in Section 8(b) of the Plan. Unless otherwise defined herein, the terms defined in the Plan shall have the same meanings in this grant document.

Each PSU that vests pursuant to the terms of this grant document shall provide Participant with the right to receive one share of the Company’s common stock (the “Share”) on the issuance date described in Section 3(f) below. The number of Shares subject to the PSUs, the performance and service vesting conditions applicable to such Shares, the date on which vested Shares shall become issuable and any further terms and conditions governing the PSUs shall be as set forth in this grant document.

1. Number of Shares . The number of Shares subject to the PSUs at target performance level is «TARGET». The maximum number of Shares subject to the PSUs is «MAX» Shares, provided, however, that the actual number of Shares that become issuable pursuant to the PSUs shall be determined in accordance with the fulfillment of certain performance conditions set forth in the attached Appendix A and the additional vesting requirements set forth in Section 3 below.

2. Performance Period . The performance period applicable to the PSUs is January 1, 2009 to December 31, 2010 (the “Performance Period”).

3. Vesting and Issuance of Shares; Dividend Equivalents . Participant’s right to receive Shares subject to the PSUs shall vest in accordance with the performance vesting conditions set forth in the attached Appendix A and subject to the following additional vesting requirements:

(a) Participant shall be entitled to receive an amount equal to any cash dividend paid by the Company upon one Share for each PSU held by Participant when such dividend is paid (“Dividend Equivalent”), provided that, (i) Participant shall have no right to receive the Dividend Equivalents unless and until the associated PSUs vest, (ii) Dividend Equivalents shall not accrue interest and (iii) Dividend Equivalents shall be paid in cash at the time that the associated PSUs vest.

(b) If Participant’s employment terminates involuntarily by reason of (i) a group termination (including, but not limited to, terminations resulting from sale of a business or division, outsourcing of an entire function, reduction in workforce or closing of a facility (a “Group Termination Event”)) or (ii) job elimination, substantial change in the nature of Participant’s position or job relocation, a pro-rated number of Shares, based on the fulfillment of the performance vesting conditions as measured at the end of the Performance Period and determined by the Committee in Section 3(f) below and the number of days during the Performance Period that Participant was actively employed by the Company or an Affiliate, shall vest. All other PSUs and associated Dividend Equivalents shall be forfeited and Participant shall have no right to or interest in such PSUs, the underlying Shares or any associated Dividend Equivalents.

(c) If Participant’s employment terminates by reason of death or disability, a pro-rated number of Shares, based on the fulfillment of the performance vesting conditions as measured between January 1, 2009 and the end of the calendar quarter in which such termination of employment takes place and determined by the Committee in Section 3(f) below and the number of days during the Performance Period that Participant was actively employed by the Company or an Affiliate, shall vest. All other PSUs and associated Dividend Equivalents shall be forfeited and Participant shall have no right to or interest in such PSUs, the underlying Shares or any associated Dividend Equivalents.

(d) If Participant’s employment terminates after attainment of age 55 with at least 5 years of service (“Retirement”), a pro-rated number of Shares, based on the fulfillment of the performance vesting conditions as measured at the end of the Performance Period and determined by the Committee in Section 3(f) below and the number of days during the Performance Period that Participant was actively employed by the Company or an Affiliate, shall vest. All other PSUs and associated Dividend Equivalents shall be forfeited and Participant shall have no right to or interest in such PSUs, the underlying Shares or any associated Dividend Equivalents.

(e) If Participant’s employment terminates for any reason other than those specified in Sections 3(b) and (c) and (d) above, all PSUs and any associated Dividend Equivalents shall be forfeited as of the date of termination of active employment and Participant shall have no right to or interest in such PSUs, the underlying Shares or any associated Dividend Equivalents.

(f) On a date as soon as practicable following the end of the Performance Period or, in the case of Section 3(c), the end of the calendar quarter in which Participant’s employment is terminated, the Committee shall certify the extent to which the performance vesting conditions set forth in Appendix A have been met (the “Certification Date”). As soon as practicable thereafter, the Company shall cause to be issued to Participant Shares with respect to any PSUs that became vested on the Certification Date, provided that Participant was employed by the Company or an Affiliate such date (unless otherwise provided in Sections 3(b), (c) or (d) above). Notwithstanding the foregoing, the Committee has the sole discretion to make downward adjustments to the award amount determined pursuant to Appendix A, including an adjustment such that no Shares are issued to Participant, regardless of the fulfillment of the performance vesting conditions set forth in Appendix A. Participant will not have any of the rights or privileges of a shareholder of the Company in respect of any Shares subject to the PSUs unless and until such Shares have been issued to Participant.

4. Taxes . Regardless of any action the Company and/or an Affiliate take with respect to any and all federal, state, local or other tax related to Participant’s participation in the Plan and legally applicable to Participant (“Tax-Related Items”), Participant acknowledges that the ultimate liability for all Tax-Related Items is and remains Participant’s responsibility. To satisfy any withholding obligations of the Company or an Affiliate with respect to Tax-Related Items, the Company will withhold Shares otherwise issuable upon vesting of the PSUs. To avoid negative accounting treatment, the Company may withhold for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates. Alternatively, or in addition, the Company may satisfy such withholding obligations by (a) withholding from Participant’s wages or other cash compensation paid to Participant by the Company or an Affiliate, (b) withholding from proceeds of the sale of Shares acquired upon vesting of the PSUs either through a voluntary sale or through a mandatory sale arranged by the Company (on Participant’s behalf pursuant to this authorization), or (c) requiring Participant to tender a cash payment to the Company or an Affiliate in the amount of the Tax-Related Items. The Company may refuse to deliver the Shares or the proceeds of the sale of Shares, if Participant fails to comply with his or her obligations in connection with the Tax-Related Items.

5. Electronic Delivery and Participation . The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan by electronic means.

Signed for and on behalf of the Company:

Herbert L. Henkel

Chairman & Chief Executive Officer

Ingersoll-Rand Company Limited

This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933

A PPENDIX A

50% OF G A CHIEVEMENT

B ASED ON EPS GROWTH VERSUS P EER COMPANIES


P ERFORMANCE L EVEL	I F I NGERSOLL -R AND ’ S PERFORMANCE IN EPS G ROWTH AGAINST THE S&P 500 I NDUSTRIAL I NDEX IS IN THE . . .	% OF TARGET PSU S A CHIEVEMENT FOR THIS COMPONENT WILL BE . . .
B ELOW T HRESHOLD	0 TO 24.9 TH PERCENTILE	0% ( NO PAYOUT )
T HRESHOLD	25 TH PERCENTILE	50%
	44.9 TH PERCENTILE	75%
T ARGET	B ETWEEN THE 45 TH PERCENTILE AND THE 54.9 TH PERCENTILE	100%
	55 TH PERCENTILE	125%
S UPERIOR	75 TH PERCENTILE OR GREATER	200%

•

PSU A CHIEVEMENT FOR THIS PORTION WOULD BE CALCULATED FOR PERFORMANCE OUTCOMES BETWEEN THE RELATIVE PERCENTILE RANKINGS DEFINED ABOVE ( E . G ., IF I NGERSOLL -R AND ’ S PERFORMANCE IS IN THE 65 TH PERCENTILE , SEE EXAMPLE ON NEXT PAGE )

•

F IFTY PERCENT OF THE PSU A CHIEVEMENT IS DETERMINED BASED ON I NGERSOLL -R AND ’ S E ARNINGS PER S HARE (“EPS”) GROWTH RELATIVE TO THE S&P 500 I NDUSTRIALS I NDEX OVER THE TWO - YEAR P ERFORMANCE P ERIOD

APPENDIX A

PSU ACHIEVEMENT EXAMPLE

F OR EPS C OMPONENT


A T G RANT (F EBRUARY 2009)
IR S TOCK P RICE ON D ATE OF G RANT		$20.00
PSP T ARGET A WARD V ALUE		$75,000
PSP T OTAL T ARGET A WARD		3,750 PSU S
PSP T ARGET FOR EPS C OMPONENT		1,875 PSU S
A T E ND OF 2-Y EAR P ERFORMANCE P ERIOD (2009-2010; PAYOUT EARLY 2011)
IR’ S 2 YEAR EPS R ELATIVE TO S&P 500 I NDUSTRIAL I NDEX		65 ^TH P ERCENTILE
IR S TOCK P RICE ON P AYOUT D ATE		$30.00
% OF PSP T ARGET A WARD ACHIEVEMENT		162.50%
T OTAL PSU A CHIEVEMENT FOR EPS C OMPONENT		3,046.875 PSU S
D OLLAR V ALUE OF PSU A CHIEVEMENT FOR EPS C OMPONENT (A WARD IS PAID IN S HARES )		$91,406.25

A PPENDIX A

50% OF PSU A CHIEVEMENT

B ASED ON P ERFORMANCE A GAINST C OST S AVINGS G OALS


P ERFORMANCE L EVEL	I F I NGERSOLL -R AND ’ S C OST S AVINGS DURING THE P ERFORMANCE P ERIOD RESULTING FROM SYNERGIES REALIZED IN THE INTEGRATION OF THE T RANE BUSINESS ARE . . .	% OF TARGET PSU A CHIEVEMENT FOR THIS COMPONENT WILL BE . . .
B ELOW T HRESHOLD	$400 MILLION OR LESS	0% ( NO PAYOUT )
T HRESHOLD	$401 MILLION	50%
	$450 MILLION	75%
T ARGET	$500 MILLION	100%
	$550 MILLION	150%
S UPERIOR	$600 MILLION	200%

•

PSU A CHIEVEMENT FOR THIS PORTION WOULD BE CALCULATED FOR PERFORMANCE OUTCOMES BETWEEN THE COST SAVINGS TARGETS DEFINED ABOVE ( E . G ., IF I NGERSOLL -R AND ACHIEVES $475 MILLION IN C OST S AVING SYNERGIES , SEE EXAMPLE ON NEXT PAGE )

•

F IFTY PERCENT OF THE PSU A CHIEVEMENT IS DETERMINED BASED ON I NGERSOLL -R AND ’ S PERFORMANCE AGAINST PREDETERMINED C OST S AVINGS G OALS OVER THE TWO - YEAR P ERFORMANCE P ERIOD

A PPENDIX A

PSU ACHIEVEMENT EXAMPLE

F OR C OST S AVINGS C OMPONENT


A T G RANT (F EBRUARY 2009)
IR S TOCK P RICE ON D ATE OF G RANT		$20.00
PSP T ARGET A WARD V ALUE		$75,000
PSP T OTAL T ARGET A WARD		3,750 PSU S
PSP T ARGET FOR C OST S AVINGS C OMPONENT		1,875 PSU S
A T E ND OF 2-Y EAR P ERFORMANCE P ERIOD (2009-2010; PAYOUT EARLY 2011)
C OST S AVINGS S YNERGIES A CHIEVED		$475 M ILLION
IR S TOCK P RICE ON P AYOUT D ATE		$30.00
% OF PSP T ARGET A WARD A CHIEVEMENT		87.5%
PSU A CHIEVEMENT FOR C OST S AVINGS C OMPONENT		1,640.625 PSU S
D OLLAR V ALUE OF PSU A CHIEVEMENT FOR C OST S AVINGS C OMPONENT		$49,218.75
T OTAL PSU A CHIEVEMENT FOR BOTH C OMPONENTS		4,687.5
T OTAL D OLLAR V ALUE OF PSU A CHIEVEMENT		$140,625

Exhibit 10.58

I NGERSOLL -R AND C OMPANY L IMITED

I NCENTIVE S TOCK P LAN OF 2007

P ERFORMANCE S TOCK U NIT G RANT

F OR THE 2009-2011 P ERFORMANCE P ERIOD

D ATED AS OF F EBRUARY 12, 2009

2. Performance Period . The performance period applicable to the PSUs is January 1, 2009 to December 31, 2011 (the “Performance Period”).

5. Electronic Delivery and Participation . The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan by electronic means.

Signed for and on behalf of the Company:

Herbert L. Henkel

Chairman & Chief Executive Officer

Ingersoll-Rand Company Limited

This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933

A PPENDIX A


P ERFORMANCE L EVEL	I F I NGERSOLL -R AND ’ S PERFORMANCE IN EPS G ROWTH AGAINST THE S&P 500 I NDUSTRIAL I NDEX IS IN THE . . .	% OF TARGET PSU A CHIEVEMENT WILL BE . . .
B ELOW T HRESHOLD	0 TO 24.9 TH PERCENTILE	0% ( NO PAYOUT )
T HRESHOLD	25 TH PERCENTILE	50%
	44.9 TH PERCENTILE	75%
T ARGET	B ETWEEN THE 45 TH PERCENTILE AND THE 54.9 TH PERCENTILE	100%
	55 TH PERCENTILE	125%
S UPERIOR	75 TH PERCENTILE OR GREATER	200%

•

A CTUAL PSU A CHIEVEMENT WOULD BE CALCULATED FOR PERFORMANCE OUTCOMES BETWEEN THE RELATIVE PERCENTILE RANKINGS DEFINED ABOVE ( E . G ., IF I NGERSOLL -R AND ’ S PERFORMANCE IS IN THE 65 TH PERCENTILE , SEE EXAMPLE ON NEXT PAGE )

•

T HE ACTUAL PSU A CHIEVEMENT IS DETERMINED BASED ON I NGERSOLL -R AND ’ S E ARNINGS PER S HARE (“EPS”) GROWTH RELATIVE TO THE S&P 500 I NDUSTRIALS I NDEX OVER THE THREE - YEAR P ERFORMANCE P ERIOD

A PPENDIX A

PSU ACHIEVEMENT EXAMPLE


A T G RANT (F EBRUARY 2009)
IR S TOCK P RICE ON D ATE OF G RANT		$20.00
PSP T ARGET A WARD V ALUE		$75,000
PSP T ARGET A WARD		3,750 PSU S
A T E ND OF 3-Y EAR P ERFORMANCE P ERIOD (2009-2011; PAYOUT EARLY 2012)
IR’ S 3-Y EAR EPS R ELATIVE TO S&P 500 I NDUSTRIALS I NDEX		65 TH PERCENTILE
IR S TOCK P RICE ON P AYOUT D ATE		$30.00
% OF PSP T ARGET A WARD E ARNED		162.50%
T OTAL PSU A CHIEVEMENT		6,093.75 PSU S
T OTAL V ALUE OF PSU A CHIEVEMENT (A WARD IS PAID IN S HARES )		$182,812.50

Exhibit 12

INGERSOLL-RAND COMPANY LIMITED

COMPUTATIONS OF RATIOS OF EARNINGS TO FIXED CHARGES

(Dollar Amounts in Millions)


	Years Ended December 31,
	2008			2007			2006			2005			2004
Earnings (loss) from continuing operations before income taxes	$	(2,776.0	)	$	937.5		$	857.6		$	792.8		$	557.4
Minority Interest		20.0			14.3			14.9			12.7			16.0
(Earnings) losses from equity method investees		(3.4	)		(1.0	)		—			(2.1	)		(5.7	)

Sub-total		(2,759.4	)		950.8			872.5			803.4			567.7
Fixed charges		294.6			160.9			159.6			165.4			171.8
Dividend from equity method investees		13.2			—			—			4.4			—
Capitalized interest		(1.0	)		(0.6	)		(3.2	)		(1.1	)		(1.4	)

Total earnings (loss)	$	(2,452.6	)	$	1,111.1		$	1,028.9		$	972.1		$	738.1

Fixed charges:
Interest expense	$	245.4		$	136.2		$	133.6		$	145.1		$	152.1
Capitalized interest		1.0			0.6			3.2			1.1			1.4
Rentals (one-third of rentals)		48.3			24.1			22.8			19.2			18.3

Total fixed charges	$	294.6		$	160.9		$	159.6		$	165.4		$	171.8

Ratio of earnings to fixed charges		—			6.9			6.4			5.9			4.3

Deficiency in the coverage of fixed charges by earnings before fixed charges	$	(2,747.1	)

Exhibit 21


*Name of Subsidiary*	*Percent Owned*
*ALGERIA*
Trane Algeria Sarl	100.0	%

*ARGENTINA*
Ingersoll-Rand Argentina S.A.I.C.	100.0	%
Trane de Argentina S.A.	100.0	%

*AUSTRALIA*
Ingersoll-Rand (Australia) Ltd.	100.0	%
Ingersoll-Rand Architectural Hardware (Australia) Pty. Limited	100.0	%
McAlpine Australia Pty Limited	100.0	%
McAlpine Hussmann (Australia) Pty Limited	100.0	%
McAlpine Hussmann Pty Limited	100.0	%
Triangle Refrigeration Pty. Ltd.	100.0	%

*AUSTRIA*
Interflex Datensysteme Gesmbh	100.0	%
Trane GmbH	100.0	%

*BAHAMAS*
Trane Bahamas Ltd.	100.0	%

*BARBADOS*
EBB Holdings Limited	100.0	%
Ingersoll-Rand (Barbados) Corporation	100.0	%
Ingersoll-Rand (Barbados) Holding Incorporated	100.0	%

*BELGIUM*
Ingersoll-Rand Security Technologies N.V.	100.0	%
Koxka Belgium S.A.	100.0	%
Newman Tonks Brussels N.V.	100.0	%
Separal B.V.	100.0	%
Thermo King Belgium N.V.	100.0	%
Trane Finance SPRL	100.0	%



*BERMUDA*
Ingersoll-Rand Global Holding Company Limited	100.0	%
Ingersoll-Rand Treasury Ltd.	100.0	%
Ingersoll-Rand World Trade Ltd. (Bermuda)	100.0	%
IR Techno Holding Company Limited	100.0	%
Trane Bermuda Ltd.	100.0	%
Trane Finance Limited	100.0	%
Trane Foreign Trading Company Ltd.	100.0	%
Trane L.P.	100.0	%
Woodcliff Insurance Ltd.	100.0	%

*BRAZIL*
Hussmann do Brasil Ltda.	100.0	%
Hussmann Service do Brasil Ltda.	100.0	%
Ingersoll-Rand do Brasil Ltda.	100.0	%
Itargila Mineracao Ltda.	79.8	%
Thermo King do Brasil, Ltda.	100.0	%
Trane do Brasil Industria e Comercio de Productos para Condicionamento de Ar Ltda.	100.0	%
Trane Publicidade, Móveis e Decorações Ltda.	100.0	%

*BRITISH VIRGIN ISLANDS*
Ingersoll-Rand Fu Hsing Holdings Limited	51.0	%

*CANADA*
Trane Canada Co.	100.0	%
ETC Electronic Technologies Incorporated	100.0	%
Hibon Inc.	100.0	%
Hussmann Canada Holdings Limited	100.0	%
Hussmann Canada Inc.	100.0	%
Ideal-Standard Trane Inc.	100.0	%
Ingersoll-Rand Canada, Inc.	100.0	%
Trane Canada LP	100.0	%
Trane GP Inc.	100.0	%
Trane Holding Co.	100.0	%



*CAYMAN ISLANDS*
Trane Air Conditioning Products Limited	100.0	%
Trane China Holdings Limited	100.0	%
World Standard Trade Limited	100.0	%

*CHILE*
Comercial Ingersoll-Rand (Chile) Limitada	100.0	%
Hussmann Chile S.A.	100.0	%
Ingersoll-Rand Company (Chile) y Cia Ltda.	100.0	%
Trane de Chile S.A.	100.0	%

*CHINA*
Beijing Bocom Video Communication Systems Co., Ltd.	100.0	%
Beijing Metal Door Co. Ltd.	16.6	%
Fu Hsing Industrial (Shanghai) Co., Ltd.	51.0	%
Fu Jia Hardware Products (Shanghai) Co., Ltd.	51.0	%
Guangzhou Hussmann Refrigeration Company, Ltd.	100.0	%
Ingersoll-Rand (Chang Zhou) Tools Co., Ltd.	100.0	%
Ingersoll-Rand (China) Industrial Equipment Manufacturing Co., Ltd.	100.0	%
Ingersoll-Rand (China) Investment Company Limited	100.0	%
Ingersoll-Rand (Guilin) Tools Company Limited	90.0	%
Ingersoll-Rand (Linzhou) Renewable Energy Company Limited	100.0	%
Ingersoll-Rand (Shanghai) Trading Co., Ltd.	100.0	%
Ingersoll-Rand Machinery (Shanghai) Company Limited	100.0	%
Luoyang Hussmann Refrigeration Company Ltd.	100.0	%
Nanjing Ingersoll-Rand Compressor Co., Ltd.	80.0	%
Shanghai Air-Tec Compressor Solutions Co., Ltd.	100.0	%
Shanghai Bocom Video Communication System Co., Ltd.	90.0	%
Shanghai Ingersoll-Rand Compressor Limited	100.0	%
Shenzhen Bocom System Engineering Co. Ltd.	80.0	%
Thermo King Container Temperature Control (Suzhou) Corporation Ltd.	90.0	%
Thermo King Dalian Transport Refrigeration Company, Limited	75.0	%
Triangle Hussmann Refrigeration (Shanghai) Co. Ltd.	100.0	%
A-S Air Conditioning System (Shanghai) Co. Ltd.	100.0	%
A-S Air Conditioning System (Tianjin) Co. Ltd.	100.0	%
Hang Zhou A-S Air Conditioning Technical Service Co. Ltd.	70.0	%
Trane Air Conditioning System (Jiangsu) Co. Ltd.	100.0	%
Ingersoll-Rand (Hong Kong) Holding Company Limited	100.0	%
Hussmann Tempcool (Hong Kong) Limited	100.0	%


Ingersoll-Rand (Hong Kong) Limited	100.0	%
Ingersoll-Rand Fu Hsing Limited	51.0	%
Ingersoll-Rand Superay Holdings Limited	100.0	%
Ingersoll-Rand Tool Holdings Limited	100.0	%
JTA China Import Limited	100.0	%
TJ Technical Services Limited	100.0	%
Trane Asia Pacific Ltd.	100.0	%
TYS Limited	50.0	%

*COLUMBIA*
Inversora Lockey Ltda.	55.1	%
Trane de Colombia S. A.	100.0	%

*CZECH REPUBLIC*
Emerson Electric, s.r.o.	10.0	%
Ingersoll-Rand CZ s.r.o.	100.0	%
Ingersoll-Rand Equipment Manufacturing Czech Republic s.r.o.	100.0	%
Trane CR Spol sro.	100.0	%

*DENMARK*
Ingersoll-Rand Security Technologies A/S	100.0	%
Thermo King Container-Denmark A/S	100.0	%

*DOMINICAN REPUBLIC*
Trane Dominicana, C. por A.	100.0	%

*EGYPT*
Trane S.A.E.	92.6	%
Trane Services Company L.L.C.	100.0	%

*FRANCE*
A.B.S. - R.I.C.A.	100.0	%
Bricard S.A.	100.0	%
Cacir, S.A.S.	100.0	%
Compagnie Ingersoll-Rand S.A.S.	100.0	%
Guerville Riquier Serrurerie Sarl	100.0	%
Ingersoll-Rand Air Solutions Hibon Sarl	100.0	%


Ingersoll-Rand Equipements de Production S.A.	100.0	%
IR Services S.A.R.L.	100.0	%
Koxka France SARL	100.0	%
Normbau France S.A.S.	100.0	%
S.A. Etablissements Charles Maire	100.0	%
SBA SA	20.0	%
Société Trane SAS	100.0	%
Trane Euronet G.I.E.	100.0	%
Trane France Holdings Sarl	100.0	%

*GERMANY*
Astrum Gesellschaft für angewandte Informatik mbH	100.0	%
Best Matic Vermogensverwaltungs GmbH	100.0	%
GHH-Rand Schraubenkompressoren GmbH	100.0	%
Ingersoll-Rand Beteiligungs und Grundstucksverwaltungs GmbH	100.0	%
Ingersoll-Rand GmbH	100.0	%
Ingersoll-Rand Service GmbH	100.0	%
Interflex Datensysteme GmbH & Co. KG	100.0	%
IR Deutsche Holding GmbH	100.0	%
IR Security & Safety GmbH	100.0	%
Koxka Deutschland GmbH	100.0	%
Normbau Beschlage und Ausstattungs GmbH	100.0	%
R&O Immobilien GmbH	100.0	%
Thermo King Deutschland GmbH	100.0	%
Trane Deutschland GmbH	100.0	%
Trane Germany Holdings mbH	100.0	%
Wilhelm Klein GmbH	100.0	%

*GIBRALTAR*
Ingersoll-Rand (Gibraltar) Holding Limited	100.0	%
Ingersoll-Rand (Gibraltar) Internatinoal Limited	100.0	%
Ingersoll-Rand (Gibraltar) Limited	100.0	%
Ingersoll-Rand (Gibraltar) United Limited	100.0	%

*GREECE*
Trane Hellas SA	100.0	%



*HUNGARY*
Hussmann Refrigeration (Hungary) KFT.	60.0	%
Ingersoll-Rand Hungary Central Europe Group Financing LLC	100.0	%
Trane Hungary KFT	100.0	%

*ICELAND*
Ingersoll-Rand Finance Islandi slf.	100.0	%

*INDIA*
Ingersoll-Rand (India) Limited	74.0	%
Ingersoll-Rand Industrial Products Pvt. Ltd.	100.0	%
Ingersoll-Rand International (India) Limited	100.0	%
Servicefirst Aircon Private Ltd.	100.0	%
Thermo King India Private Limited	100.0	%
Trane Design Centre Private Ltd.	100.0	%
Trane India Private Lmited	100.0	%

*INDONESIA*
PT Ingersoll-Rand Indonesia	100.0	%
PT Trane Indonesia	100.0	%

*IRELAND*
Airside Manufacturing Limited	100.0	%
Ingersoll-Rand International Finance Limited	100.0	%
Ingersoll-Rand International Limited	100.0	%
Ingersoll-Rand Irish Holdings	100.0	%
Ingersoll-Rand Technical and Services Limited	100.0	%
Spanashview	100.0	%
Standard Trane Insurance Ireland Limited	100.0	%
Thermo King European Manufacturing Limited	100.0	%
Thermo King Ireland Limited	100.0	%
Thermo King Services Limited	100.0	%
Thermo King Total Kare Limited	100.0	%
Trane (Ireland) Limited	100.0	%

*ISRAEL*
T.I. Solutions (Israel) Ltd.	100.0	%



*ITALY*
Cisa S.p.A.	100.0	%
Hussmann Koxka Italia S.r.l.	100.0	%
Ingersoll-Rand Italia S.r.l.	100.0	%
Ingersoll-Rand Italiana S.p.A.	100.0	%
Jado Italia S.r.l.	100.0	%
Officina Meccaniche Industriali SRL	100.0	%
Trane Italia S.r.L	100.0	%

*JAPAN*
Ingersoll-Rand Japan, Ltd.	100.0	%
Thermo King Japan, Ltd.	100.0	%
Trane Holdings Company YK	100.0	%
Trane Japan, Ltd.	100.0	%

*SOUTH KOREA*
Ingersoll-Rand Korea Limited	100.0	%
Trane Korea, Inc.	100.0	%

*KUWAIT*
Trane Kuwait Airconditioning Co WLL	50.0	%
United Partner General Contracting Co WLL	98.0	%

*LIECHTENSTEIN*
TSI Anstalt Ltd.	100.0	%

*LUXEMBOURG*
Ingersoll-Rand Holdings & Finance International S.a.r.l	100.0	%
Ingersoll-Rand Lux Euro Financing S.ar.l.	100.0	%
Ingersoll-Rand Lux Finance Holding S.ar.l.	100.0	%
Ingersoll-Rand Lux Holdings S.ar.l.	100.0	%
Ingersoll-Rand Lux International S.a.r.l.	100.0	%
Ingersoll-Rand Lux Roza III S.a.r.l.	100.0	%
Ingersoll-Rand Lux Roza S.a.r.l.	100.0	%
Ingersoll-Rand Luxembourg United S.a.rl.	100.0	%
Ingersoll-Rand Roza II S.ar.l.	100.0	%
Ingersoll-Rand Worldwide Capital S.a.r.l.	100.0	%



*MALAYSIA*
Hussmann Tempcool (Malaysia) Limited	100.0	%
Ingersoll-Rand Malaysia Co. Sdn. Bhd.	100.0	%
Maltaitech Corporation Sdn. Bhd.	51.0	%
TM Air Conditioning Sdn. Bhd.	70.0	%
Trane (Malaysia) Sdn. Bhd.	100.0	%
Trane Malaysia Sales & Services SDN. BHD.	100.0	%

*MAURITIUS*
Industrial Chill Servicing Private Ltd.	100.0	%

*MEXICO*
Hussmann-American, S. de R.L. de C.V.	100.0	%
Hussmann-Mexico, S. de R.L. de C.V.	100.0	%
Hussmann-Servicios, S. de R.L. de C.V.	100.0	%
Industria Ceramica Del Centro, S. A. de C. V.	96.0	%
Industrial Y Minera Norteña S. A.	49.0	%
Industrias Frigorificas, S.A. de C.V.	100.0	%
Ingersoll-Rand S.A. de C.V.	100.0	%
Minera Industrial Regiomontana, S.A.	51.0	%
Schlage de Mexico S.A. de C.V.	100.0	%
Trane Logistica, S. A. de C. V.	100.0	%
Trane S.A. de C.V.	100.0	%
Trane Sistemas Integrales S. de R.L. de C.V.	100.0	%

*NETHERLANDS*
Cielle B.V.	100.0	%
ECO Kompressoren B.V.	100.0	%
Fincisa B.V.	100.0	%
Hussmann Netherlands B.V.	100.0	%
Ingersoll-Rand European Holding Company B.V.	100.0	%
Ingersoll-Rand Netherlands B.V.	100.0	%
Ingersoll-Rand Security Technologies B.V.	100.0	%
Ingersoll-Rand Service B.V.	100.0	%
IR Holdings (Netherlands) B.V.	100.0	%


Thermo King Transportkoeling B.V.	100.0	%
DiaSorin International B. V.	100.0	%
Trane Airconditioning BV	100.0	%
Trane BVBA	100.0	%
Trane Dutch Holdings B.V.	100.0	%
Trane Europe Holdings B.V.	100.0	%
Trane Holdings BV	100.0	%

*NEW ZEALAND*
Club Car Limited	100.0	%
Contract Refrigeration Ltd.	100.0	%
Hussmann Australasia Limited	100.0	%
Ingersoll-Rand Architectural Hardware Limited	100.0	%
McAlpine Hussmann Limited	100.0	%
McAlpine Industries Limited	100.0	%
Temperature Consultants Limited	100.0	%

*PERU*
Ingersoll-Rand Company of Peru S.A.	100.0	%

*PHILIPPINES*
American Standard Philippine Holdings Inc.	100.0	%
Filairco Inc.	100.0	%
Filairco Technical Services Co. Inc.	40.0	%
Ingersoll-Rand Philippines, Inc.	100.0	%
Standard Industrial Mineral Products Corp.	40.0	%
Standard Resources and Development Corp	40.0	%

*POLAND*
Hussmann Koxka Poland, Spzoo	100.0	%
Ingersoll-Rand Polska Sp.zo.o	100.0	%
Trane Polska SP ZOO	100.0	%

*PORTUGAL*
Comingersoll-Comercio e Industria de Equipamentos, S.A.R.L.	20.7	%



*ROMANIA*
Trane Romania S.R.L.	100.0	%

*RUSSIA*
Ingersoll-Rand Services and Trading LLC	100.0	%
Trane Technologies LLC	100.0	%
Wabco Standard Trane CIS	100.0	%
ZAO Ingersoll-Rand CIS	100.0	%

*SINGAPORE*
Hussmann Tempcool (Singapore) Pte. Ltd.	100.0	%
Hussmann Tempcool Holdings PTE. Ltd.	50.0	%
Ingersoll-Rand South East Asia (Pte.) Ltd.	100.0	%
Tac Distribution Pte. Ltd.	100.0	%
Trane Airconditioning Pte. Ltd.	100.0	%

*SLOVENIA*
Plurifilter D.o.o.	100.0	%

*SOUTH AFRICA*
D. Purdue & Sons Ltd.	25.0	%
Ingersoll-Rand Company South Africa (Pty.) Limited	100.0	%
NT South Africa	100.0	%

*SPAIN*
Cisa Cerraduras S.A.	100.0	%
Hussmann Koxka, S.L.	100.0	%
Ingersoll-Rand Iberica, S.L.	100.0	%
Ingersoll-Rand Rodamientos Holding, S.L.	100.0	%
Ingersoll-Rand Servicios, S.A.	100.0	%
Koxka Levante S.A.	60.0	%
Reftrans, S.A.	85.0	%
Trane Aire Acondicionado S.L.	100.0	%

*SWEDEN*
Ingersoll-Rand AB	100.0	%
Ingersoll-Rand Best-Matic AB	100.0	%
Ingersoll-Rand Svenska AB	100.0	%
Trane Sweden AB	100.0	%



*SWITZERLAND*
Ingersoll-Rand Acceptance Company S.A.	100.0	%
Ingersoll-Rand Equipment and Consulting S.A.R.L.	100.0	%
Ingersoll-Rand International Sales S.A.	100.0	%
Ingersoll-Rand Investment Company S.A.	100.0	%
Ingersoll-Rand Machinery and Services S.A.R.L.	100.0	%
Ingersoll-Rand S.A.	100.0	%
Ingersoll-Rand Services & Engineering Company	100.0	%
Ingersoll-Rand Technical and Services S.A.R.L.	100.0	%
Interflex Datensysteme AG	100.0	%
I-R Trading S.A.	100.0	%
Klemm Bohrtechnik AG	100.0	%
Trane (Schweiz) GmbH / Trane (Suisse) S.à.r.l.	100.0	%
Trane S.A.	100.0	%

*TAIWAN*
Fu Yang Investment Company Limited	100.0	%
Taiwan Fu Hsing Industrial Co. Ltd.	9.9	%
Trane Taiwan Distribution Ltd.	100.0	%
Troc Air Conditioning, Ltd.	100.0	%

*THAILAND*
Airco Limited	50.0	%
Amair Limited	50.2	%
Hussmann (Thailand) Company Limited	75.0	%
Hussmann-Thai Holding Co., Ltd.	100.0	%
Prime Air Limited	100.0	%
Tast Limited	30.0	%
Trane (Thailand) Ltd.	100.0	%

*TUNISIA*
Trane Tunisia S.a.r.l.	100.0	%

*TURKEY*
IR Emniyet ve Guvenlik Sistemleri Sanayi A.S.	100.0	%
Trane Klima Ticaret AS	100.0	%



*UNITED KINGDOM*
A/S Parts Limited	100.0	%
Airtec Limited	100.0	%
Best Matic International Limited	100.0	%
Briton Door Controls Limited	100.0	%
C.A.P. Sales Limited	100.0	%
Capital Metalworks Limited	100.0	%
CISA (UK) Plc.	100.0	%
Compressed Air Parts Limited	100.0	%
D.A. Thomas (Northern) Limited	100.0	%
Hussmann (Europe) Limited	100.0	%
Hussmann Holdings Limited	100.0	%
Ingersoll-Rand Company Limited	100.0	%
Ingersoll-Rand European Financial Services plc.	100.0	%
Ingersoll-Rand European Sales Limited	100.0	%
Ingersoll-Rand Financial Services Limited	100.0	%
Ingersoll-Rand Holdings Limited	100.0	%
Ingersoll-Rand Investments Limited	100.0	%
Ingersoll-Rand Security Technologies Limited	100.0	%
Ingersoll-Rand UK Ltd.	100.0	%
Interflex Time & Access Ltd.	100.0	%
IR Investment Holding Co. Ltd.	100.0	%
IR Security and Safety (South East) Limited	100.0	%
IR Security and Safety (Tayforth) Limited	100.0	%
IR Security and Safety Architectural Hardware Limited	100.0	%
IR Security and Safety Thomson Group Limited	100.0	%
Newman Tonks (Amersham) Limited	100.0	%
Newman Tonks (Overseas Holdings) Limited	100.0	%
Newman-Tonks Management Services Limited	100.0	%
North West Compressed Air Company Ltd.	100.0	%
NT Group Properties Limited	100.0	%
NT Leamington Limited	100.0	%
NT Legge Limited	100.0	%
NT Sittingbourne Limited	100.0	%
Roconeco Limited	100.0	%


Trane (Colchester) Ltd.	100.0	%
Trane (UK) Ltd.	100.0	%
William Newman & Sons, Limited	100.0	%

*UNITED STATES*
Armoro, Inc.	100.0	%
Commercial Refrigeration Co.	100.0	%
Ingersoll-Rand Industrial Refrigeration, Inc.	100.0	%
Recognition Systems, LLC	100.0	%
Schlage Lock Company	100.0	%
Touch-Plate International, Inc.	100.0	%
Silver Holding Corp.	100.0	%
Alimenterics Inc.	100.0	%
Alimenterics International Inc.	100.0	%
Alliance Compressors Inc.	51.0	%
Alliance Compressors LLC	24.5	%
ASI Receivables Funding LLC	100.0	%
B&K Credit Inc.	100.0	%
B&K Manufacturing Corporation	100.0	%
BMM, Inc.	100.0	%
Capsule Trane Connecticut Inc.	100.0	%
Cardwell Trane Greenville Inc.	100.0	%
Clean Air, Inc.	100.0	%
Club Car, Inc.	100.0	%
DFM Trane Oklahoma Corp.	100.0	%
DiaSorin International Inc.	100.0	%
D-R Acquisition, LLC	100.0	%
DR Holding Corp.	100.0	%
Dradnats Inc.	100.0	%
Earthforce America, Inc.	100.0	%
FWJ Inc.	100.0	%
Harrow Industries LLC	100.0	%
Harrow Products (Delaware) LLC	100.0	%
Harrow Products LLC	100.0	%
Hermann Trane Harrisburg Inc.	100.0	%
Hussmann Holdings, Inc.	100.0	%
Hussmann International, Inc.	100.0	%


Hussmann Mechanical Corporation	100.0	%
Hussmann Services Corporation	100.0	%
IDP Acquisition, LLC	100.0	%
Improved Machinery, Inc.	100.0	%
Ingersoll-Rand Asia Pacific Inc.	100.0	%
Ingersoll-Rand Charitable Foundation	100.0	%
Ingersoll-Rand China Limited	100.0	%
Ingersoll-Rand Climate Control Holding Corporation	100.0	%
Ingersoll-Rand Construction Services, Inc.	100.0	%
Ingersoll-Rand Energy Technologies LLC	100.0	%
Ingersoll-Rand Energy Techologies (Aviara) LLC	100.0	%
Ingersoll-Rand Energy Techologies (Project DDI) LLC	100.0	%
Ingersoll-Rand Energy Techologies (Project East) LLC	100.0	%
Ingersoll-Rand Energy Techologies (Project Horton) LLC	100.0	%
Ingersoll-Rand Enhanced Recovery Company	100.0	%
Ingersoll-Rand Financial Services Corporation	100.0	%
Ingersoll-Rand International Sales LLC	100.0	%
Ingersoll-Rand International, Inc.	100.0	%
Ingersoll-Rand Italian Holding LLC	100.0	%
Ingersoll-Rand Plus, LP	100.0	%
Ingersoll-Rand Sales Company, LLC	100.0	%
Ingersoll-Rand Security and Safety Holding Corporation	100.0	%
Ingersoll-Rand Services Company	100.0	%
Ingersoll-Rand Spanish Holding LP	100.0	%
Ingersoll-Rand Transportation Services Company	100.0	%
Ingersoll-Rand US Trane Holdings Corporation	100.0	%
Ingersoll-Rand US United, LLC	100.0	%
Ingersoll-Rand Western Hemisphere Trade Corporation	100.0	%
Ingersoll-Rand Worldwide, Inc.	100.0	%
I-R E-Medical, Inc.	99.0	%
Ives Trane NY, Inc.	100.0	%
Marlorch, Inc.	100.0	%
MJM Hong Kong Ltd.	100.0	%
Monarch Hardware and Manufacturing Company LLC	100.0	%
Mongrue Trane Massachusetts, Inc.	100.0	%
Newman Tonks, USA, LLC	100.0	%
Newman-Tonks Holdings LLC	100.0	%


Newman-Tonks Investments LLC	100.0	%
Perfect Pitch LP	67.6	%
Pinko Palino Inc.	100.0	%
Rand Trane Dallas Inc.	100.0	%
SBG Holding Corp.	100.0	%
Schlage Lock Company LLC	100.0	%
Standard Centennial Property LLC	100.0	%
Standard Compressors Inc.	100.0	%
Thermo King Corporation	100.0	%
Thermo King de Puerto Rico, Inc.	100.0	%
Thermo King Enterprises Company	100.0	%
Thermo King SVC, Inc.	100.0	%
Thermo King Trading Company	100.0	%
Trane Air Inc.	100.0	%
Trane America LLC	100.0	%
Trane Aviation LLC	100.0	%
Trane Brands, Inc.	100.0	%
Trane Central America, Inc.	100.0	%
Trane Central Plant I, LLC	100.0	%
Trane Comfort Solutions Inc.	100.0	%
Trane Credit Inc.	100.0	%
Trane Export LLC	100.0	%
Trane Foundation of New York	100.0	%
Trane General Corporation	100.0	%
Trane Holdings LLC	100.0	%
Trane IBV Ltd.	100.0	%
Trane Inc.	100.0	%
Trane Inc. of Delaware	100.0	%
Trane India Ltd.	100.0	%
Trane International Inc.	100.0	%
Trane IP Inc.	100.0	%
Trane Leasing Inc.	100.0	%
Trane Logistics Corporation	100.0	%
Trane Puerto Rico Inc.	100.0	%
Trane Services Acquisition I Inc.	100.0	%
Trane U.S. Export Ltd.	100.0	%
Trane U.S. Inc.	100.0	%


Trane U.S. Logistics Inc.	100.0	%
Trane Vidalia LLC	100.0	%
World Standard Ltd.	100.0	%
XceedID Corporation	100.0	%
ZEKS Compressed Air Solutions LLC	100.0	%
Lockey Corp.	56.0	%
Security One Systems of Jacksonville	100.0	%
Security One Systems, Inc.	100.0	%
Dor-O-Matic (Illinois) LLC	100.0	%
Krack Corporation	100.0	%
Von Duprin LLC	100.0	%
Crystal Refrigeration, Inc.	100.0	%
Taylor Industries, Inc.	100.0	%
Ingersoll-Rand Infrastructure Holding Corporation	100.0	%
Ingersoll-Rand, Inc.	100.0	%
MFP (Kentucky) LLC	100.0	%
Terry D. Carter Service Co., Inc.	100.0	%
Ingersoll-Rand Energy Systems Corporation	100.0	%
Chesley Industries, Inc.	100.0	%
Ingersoll-Rand Liability Management Company	100.0	%
Refrigeration Engineering, Inc.	100.0	%
Checker Flag Parts, Inc.	100.0	%
Hussmann Corporation	100.0	%
Nelson Refrigeration Inc.	100.0	%
The Trane Company	100.0	%
Dor-O-Matic of Mid Atlantic States, Inc.	100.0	%
Ingersoll-Rand Company	100.0	%
Ingersoll-Rand International Holding Corporation	100.0	%
Integrated Access Systems, Inc.	100.0	%
Interflex N.A., Inc.	100.0	%
Compressed Air Parts, Inc.	100.0	%
Electronic Technologies Corporation USA	100.0	%
Ingersoll-Rand de Puerto Rico, Inc.	100.0	%
Roconeco Corporation	100.0	%
Standard Trane Warranty Company	100.0	%
A-S Energy, Inc.	100.0	%
FACServices, LLC	100.0	%


Houston Trane, Inc.	100.0	%
Standard Trane Insurance Company	100.0	%
Ingersoll-Rand Industrial Solutions Holding Corporation	100.0	%
Rogers Refrigeration Co., Inc.	100.0	%
Tavant Technologies, Inc.	19.5	%
Refrigeration Service & Design, Inc.	100.0	%
WHS Refrigeration Services, Inc.	100.0	%

*VENEZUELA*
Administradora Lockey CA	56.0	%
Aro de Venezuela, C.A.	100.0	%
Inversora Lockey de Venezuela CA	56.0	%
Trane Servicefirst, C.A.	100.0	%
Tratamaq CA	42.0	%

*VIETNAM*
Trane Vietnam Services Company Ltd.	100.0	%

*ZAMBIA*
Ingersoll-Rand Limited (Zambia)	100.0	%

*ZIMBABWE*
Ingersoll-Rand Zimbabwe (Private) Ltd.	100.0	%

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3, (No. 333-152954-01, No. 333-88580 and No. 333-88580-01) and S-8 (No. 333-67257, No. 333-35229, No. 333-00829, No. 333-19445, No. 333-42133, No. 333-128260, No. 333-130047, No. 333-143716, No. 333-149396, No. 333-149537 and No. 333-151607) of Ingersoll-Rand Company Limited of our report dated February 27, 2009 relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP

Florham Park, New Jersey

February 27, 2009

Exhibit 23.2

Consent of Analysis, Research & Planning Corporation

We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 333-152954-01, No. 333-88580, and No. 333-88580-01) and S-8 (No. 333-67257, No. 333-35229, No. 333-00829, No. 333-19445, No. 333-42133, No. 333-128260, No. 333-130047, No. 333-143716, No. 333-149396, No. 333-151607 and No. 333-149537) of Ingersoll-Rand Company Limited (the “Company”) of (i) the references to us in the form and context in which they appear in such registration statements, and (ii) the use of or reliance on the information contained in our report to the Company to assist the Company in setting forth an estimate of the Company’s total liability for pending and unasserted future asbestos-related claims in such registration statements.

February 27, 2009


Analysis, Research & Planning Corporation

By:		/s/ Thomas Vasquez
Name:		Thomas Vasquez, Ph.D
Title:		Vice President

Exhibit 31.1

CERTIFICATION

I, Herbert L. Henkel, certify that:

1.	I have reviewed the annual report on Form 10-K of Ingersoll-Rand Company Limited for the year ended December 31, 2008;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: February 27, 2009				/s/ Herbert L. Henkel
				Herbert L. Henkel
				Principal Executive Officer

Exhibit 31.2

CERTIFICATION

I, Steven R. Shawley, certify that:

1.	I have reviewed the annual report on Form 10-K of Ingersoll-Rand Company Limited for the year ended December 31, 2008;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: February 27, 2009				/s/ Steven R. Shawley
				Steven R. Shawley
				Principal Financial Officer

Exhibit 32

Section 1350 Certifications

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of Ingersoll-Rand Company Limited (the Company), does hereby certify that:

The Annual Report on Form 10-K for the year ended December 31, 2008 (the Form 10-K) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Herbert L. Henkel

Herbert L. Henkel

Principal Executive Officer

February 27, 2009

/s/ Steven R. Shawley

Steven R. Shawley

Principal Financial Officer

February 27, 2009