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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
FORM 10-K

(Mark One)	 	

ý	
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934	

For the fiscal year ended September 28, 2007	

or	

o	
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934	
001-33260
 (Commission File Number)
TYCO ELECTRONICS LTD.
 (Exact name of registrant as specified in its charter)

Bermuda 
(Jurisdiction of Incorporation)	 	98-0518048 
(I.R.S. Employer Identification No.)	
Second Floor, 96 Pitts Bay Road, Pembroke HM 08, Bermuda
 (Address of principal executive offices)
441-294-0607
 (Registrant's telephone number)

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

Title of each class

Name of each exchange on which registered
	
Common Shares, Par Value $0.20	 	New York Stock Exchange	

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  o  No  ý
        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  o  No  ý
        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  ý  No  o
        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 or this Form 10-K or any amendment to this Form 10-K     o
        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act (check one):
Large accelerated filer  o                 Accelerated filer  o                 Non-accelerated filer  ý
        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  o  No  ý
        As of March 30, 2007, the last business day of the registrant's most recently completed second fiscal quarter, the registrant's common stock was not publicly traded. The aggregate market value of the registrant's common stock held by non-affiliates of the registrant on June 29, 2007, the effective date of the registrant's separation from Tyco International Ltd., was $19,404,072,239. Directors and executive officers of the registrant are considered affiliates for purposes of this calculation but should not necessarily be deemed affiliates for any other purpose.
        The number of common shares outstanding as of December 11, 2007 was 494,220,968.
DOCUMENTS INCORPORATED BY REFERENCE
        Portions of the registrant's Proxy Statement filed within 120 days of the close of the registrant's fiscal year in connection with the registrant's 2008 annual general meeting of shareholders are incorporated by reference into Part III of this Form 10-K to the extent described therein.

 TYCO ELECTRONICS LTD.
TABLE OF CONTENTS

 	 	 	 	Page
	
Part I	
Item 1.	 	Business	 	1	
Item 1A.	 	Risk Factors	 	11	
Item 1B.	 	Unresolved Staff Comments	 	24	
Item 2.	 	Properties	 	25	
Item 3.	 	Legal Proceedings	 	26	
Item 4.	 	Submission of Matters to a Vote of Security Holders	 	37	

Part II	
Item 5.	 	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	 	38	
Item 6.	 	Selected Financial Data	 	39	
Item 7.	 	Management's Discussion and Analysis of Financial Condition and Results of Operations	 	41	
Item 7A.	 	Quantitative and Qualitative Disclosures About Market Risk	 	69	
Item 8.	 	Financial Statements and Supplementary Data	 	70	
Item 9.	 	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	 	70	
Item 9A.	 	Controls and Procedures	 	70	
Item 9B.	 	Other Information	 	71	

Part III	
Item 10.	 	Directors, Executive Officers and Corporate Governance	 	72	
Item 11.	 	Executive Compensation	 	72	
Item 12.	 	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	 	72	
Item 13.	 	Certain Relationships and Related Transactions, and Director Independence	 	72	
Item 14.	 	Principal Accounting Fees and Services	 	72	

Part IV	
Item 15.	 	Exhibits and Financial Statement Schedules	 	73	
Signatures	 	76	
Index to Consolidated and Combined Financial Statements	 	78	
i

 SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS
        We have made forward-looking statements in this Annual Report on Form 10-K, including in the sections entitled "Business," "Risk Factors," "Legal Proceedings," "Management's Discussion and Analysis of Financial Condition and Results of Operations," and "Quantitative and Qualitative Disclosures about Market Risk," that are based on our management's beliefs and assumptions and on information currently available to our management. Forward-looking statements include, among others, the information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition, and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," "plan," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "should," or the negative of these terms or similar expressions.
        Forward-looking statements involve risks, uncertainties, and assumptions. Actual results may differ materially from those expressed in these forward-looking statements. You should not put undue reliance on any forward-looking statements. We do not have any intention or obligation to update forward-looking statements after we file this report except as required by law.
        The risk factors discussed in "Risk Factors" and other risks identified in the Annual Report could cause our results to differ materially from those expressed in forward-looking statements. There may be other risks and uncertainties that we are unable to predict at this time or that we currently do not expect to have a material adverse effect on our business.
ii

 PART I
ITEM 1.    BUSINESS
Overview
        Tyco Electronics Ltd. ("we," "Tyco Electronics," or the "Company") is a leading global provider of engineered electronic components, network solutions, wireless systems, and undersea telecommunication systems. We design, manufacture, and market products for customers in industries from automotive, appliance, and aerospace and defense to telecommunications, computers, and consumer electronics. Our products are produced in approximately 120 manufacturing sites in over 25 countries. With over 8,000 engineers and worldwide manufacturing, sales, and customer service capabilities, Tyco Electronics' commitment is our customers' advantage.
        Tyco Electronics Ltd. was incorporated in Bermuda in fiscal 2000 as a wholly-owned subsidiary of Tyco International Ltd. ("Tyco International"). For the period following its incorporation, Tyco Electronics Ltd. did not engage in any significant business activities and held minimal assets. In connection with our separation from Tyco International, the equity interests in the entities that hold all of the assets and liabilities of Tyco International's electronics businesses were transferred to Tyco Electronics.
        Our business was formed principally through a series of acquisitions, from fiscal 1999 through fiscal 2002, of established electronics companies and divisions, including the acquisition of AMP Incorporated and Raychem Corporation in fiscal 1999 and the Electromechanical Components Division of Siemens and OEM Division of Thomas & Betts in fiscal 2000. These companies each have more than 50 years of history in engineering and innovation excellence. We operated as a segment of Tyco International prior to our separation.
        Effective June 29, 2007, Tyco International distributed all of its shares of Tyco Electronics to its common shareholders. Tyco Electronics Ltd. became an independent, publicly traded company owning the former electronics businesses of Tyco International Ltd.
        Our reporting segments manufacture and distribute our products and solutions to a number of end markets. The table below provides a summary of our reporting segments, the fiscal 2007 net sales contribution of each segment, and the key products and markets that we serve:

Segment
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
	 	Electronic
Components
	 	Network
Solutions
	 	Wireless
Systems
	 	Undersea
Telecommunications
	
% of Fiscal 2007 Net Sales
									
	 	75%
	 	14%
	 	7%
	 	4%
	
Key Products	 	•
•
•
•
•

•
•
•	 	Connector systems
Relays
Heat shrink tubing
Fiber optics
Circuit protection
devices
Wire and cable
Touch screens
Application tooling	 	•
•
•
•
•
•

•	 	Connector systems
Heat shrink tubing
Fiber optics
Wire and cable
Racks and panels
Intelligent building
controls
Network interface
devices	 	•

•

•	 	Land mobile radios
and systems
Radio frequency
components and
subsystems
Radar systems	 	•	 	Undersea
telecommunication
systems	

Key Markets	
 	
•
•
•

•
•
•

•	
 	
Automotive
Computer
Communication
equipment
Appliance
Industrial machinery Aerospace and
defense
Consumer
electronics	
 	
•
•

•	
 	
Energy
Communication
service providers
Building networks	
 	
•
•

•

•	
 	
Public safety
Communication
equipment
Aerospace and
defense
Automotive	
 	
•

•	
 	
Communication
service providers
Oil and gas	
1

See Note 24 to the Consolidated and Combined Financial Statements for certain segment and geographic financial information relating to our business.
Our Competitive Strengths
        We believe that we have the following competitive strengths:
•
Global leader in passive components.   With net sales of approximately $13.5 billion in fiscal 2007, we are significantly larger than many of our competitors. In the $40 billion fragmented connector industry, our net sales were approximately $8 billion in fiscal 2007. We have established a global leadership position in the connector industry with leading market positions in the following markets:

•
Automotive—#1

•
Computers and peripherals—#1

•
Industrial—#1

•
Telecom/data communications—#2
Our scale provides us the opportunity to accelerate our sales growth by making larger investments in existing and new technologies in our core markets and to expand our presence in emerging markets. Our leadership position also provides the opportunity to lower our purchasing costs by developing lower cost sources of supply and to maintain a flexible manufacturing footprint worldwide that is close to our customers' locations.
•
Strong customer relationships.   As an industry leader, we have established close working relationships with our customers. These relationships allow us to anticipate and be responsive to customer needs when designing new products and new technical solutions. By working with our customers in developing new products and technologies, we believe we are able to identify and act on trends and leverage knowledge about next-generation technology across our products. In addition, we operate a broad Global Account Management program through which we maintain close working relationships with the key customers in the end markets that we serve.

•
Process and product technology leadership.   We employ over 8,000 engineers dedicated to product research, development, and engineering. Our investment of $600 million per year in product and process engineering and development together with our capital spending of nearly $900 million in fiscal 2007, enable us to consistently provide innovative, high-quality products with efficient manufacturing methods.

•
Diverse product mix and customer base.   We manufacture and sell a broad portfolio of products to customers in various industries. Our customers include many of the leaders in their respective industries and our relationships with them typically date back many years. We believe that this diversified customer base reduces our exposure to a particular end market and therefore the variability of our financial performance, and provides us an opportunity to leverage our skills and experience across markets. Additionally, we believe that the diversity of our customer base reduces the level of cyclicality in our results and distinguishes us from our competitors.

•
Balanced geographic sales mix.   We have an established manufacturing presence in over 25 countries and our sales are global. Our global coverage positions us near our customers' locations and allows us to assist them in consolidating their supply base and lowering their production costs. We believe our balanced sales distribution lowers our exposure to any particular geography and improves our financial profile. In addition, our strategy is to continue to increase the percentage of production from low-cost countries.

•
Strong and experienced management team.   We believe we have a management team that has the experience necessary to effectively execute our strategy and advance our product and technology
2

leadership. Our Chief Executive Officer, President, and segment leaders average more than 20 years of experience in the electronics industry. They are supported by an experienced and talented management team that is dedicated to maintaining and expanding our position as a global leader in the industry.
Our Strategy
        Our goal is to be the world leader in providing custom-engineered electronic components and solutions for an increasingly connected world. We believe that in achieving this goal we will increase net sales and profitability across our segments in the markets that we serve. Our business strategy is based upon the following priorities:
•
Continue to focus our existing portfolio.   As part of our strategy, we regularly review and will consider the divestiture of underperforming or non-strategic businesses to improve our operating results and better utilize our capital. Some of these divestitures may have a material impact on our Consolidated Financial Statements, and we currently believe these divestitures, including the Power Systems business and other product exits, could reduce our consolidated net sales by approximately 15%. We have made strategic divestitures in the past and expect that we may make additional divestitures in the future. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Divestitures and Manufacturing Simplification."

•
Leverage our market leadership position to increase our market share.   We are the global leader in many of the markets that we serve. For example, within our Electronic Components segment, we are the leading global supplier of connectors and connector systems to the automotive, computers and storage, and industrial markets. We believe that these and other markets are critical to our success and that we must continue to strengthen our leadership position in these markets. We plan to capitalize on the expected growth in these markets by leveraging our significant scale in the industry, the breadth of our product portfolio, our established relationships and leading specification positions with our customers, and our extensive worldwide distribution channels.

•
Achieve market leadership in attractive and under-penetrated industries.   We plan to accelerate growth in end-user markets in which we do not have the number one market share but which we believe have attractive growth and profitability characteristics. These markets include: aerospace and defense, consumer electronics, mobile phone, and medical markets with respect to our Electronic Components segment; the land mobile radio market with respect to our Wireless Systems segment; and the energy and communication service provider market with respect to our Network Solutions segment. We believe that we can further leverage our customer service and our new product and technology capabilities in order to achieve a leading position in these markets.

•
Extend our leadership in key emerging markets.   We seek to improve our market leadership position in emerging geographic regions, including China, Eastern Europe, and India, which we expect will experience higher growth rates compared to that of more developed regions in the world. In fiscal 2007, we generated $1.6 billion of net sales from China, $937 million of net sales in Eastern Europe, and $168 million of net sales in India. We have been increasing our sales and marketing, engineering, and manufacturing resources in these emerging regions in order to more fully capitalize on our skills and technologies. We believe that expansion in these regions will enable us to grow faster than the overall global market.

•
Supplement organic growth with strategic acquisitions.   We will evaluate and selectively pursue strategic acquisitions that strengthen our market position, enhance our existing product offering, enable us to enter attractive markets, expand our technological capabilities, and provide synergy opportunities.
3

•
Improve operating margins.   We intend to continue to increase our productivity and reduce our manufacturing costs. We plan to achieve this through best in class in manufacturing, enhancing our purchasing strategy by strengthening our procurement organization and simplifying our vendor base, and further implementing strategic programs such as our Six Sigma initiative. We also plan to continue to simplify our global manufacturing footprint, both by migrating facilities from high cost to low cost countries and by consolidating within countries. With respect to our manufacturing rationalization plan, we expect to incur restructuring charges of approximately $130 million in fiscal 2008 and up to $250 million from fiscal 2009 through 2010. These initiatives are designed to help us to maintain our competitiveness in the industry.

•
Accelerate new product development through research and development excellence.   We seek to continue to increase the percentage of our annual net sales from products launched within the previous year. In fiscal 2007, we derived 15% of our net sales from new products launched within the previous fiscal year. In order to accomplish this goal, we intend to focus our research, development, and engineering investment on next generation technologies and highly engineered products and platforms, and leverage innovation across our segments.
Our Products
        Our net sales by reporting segment as a percentage of our total net sales was as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Electronic Components	 	75	%	76	%	77	%	
Network Solutions	 	14	 	14	 	13	 	
Wireless Systems	 	7	 	7	 	8	 	
Undersea Telecommunications	 	4	 	3	 	2	 	
 	 		 		 		 	
Total	 	100	%	100	%	100	%	
 	 		 		 		 	
Electronic Components
        Our Electronic Components segment is one of the world's largest suppliers of passive electronic components, which includes connectors and interconnect systems, relays, switches, circuit protection devices, touchscreens, sensors, and wire and cable. The products sold by the Electronic Components segment are sold primarily to original equipment manufacturers and their contract manufacturers in the automotive, computer, consumer electronics, communication equipment, appliance, aerospace and defense, industrial machinery, and instrumentation markets. The following are the primary product families sold by the segment:
•
Connector Systems and Components.   We offer an extensive range of electrical and electronic interconnection products. These connectors include a wide variety of pin and socket, USB, coaxial, I/O, fiber optic, and power connectors, as well as sophisticated interconnection products used in complex telecommunications and computer equipment.

•
Relays.   Our relay products can be used in a wide range of applications in the automotive, telecommunications, industrial, and aerospace industries, including electric sunroofs, anti-lock braking systems, and fuel injection coils for the automotive industry, signal and power relay technologies for the telecommunications industry, and high-performance products for the aerospace industry.

•
Heat Shrink Tubing.   We offer hundreds of reliable, cost-effective products to seal, connect, insulate, protect, hold, and bundle high-performance electrical harnesses. We also provide customized harnessing design, prototype, and build services.
4

•
Fiber Optics.   We manufacture fiber optic connectors, cable assemblies, adapters, and accessories. We provide highly engineered products that connect, configure, and control light.

•
Circuit Protection Devices.   We offer a range of circuit protection devices, which limit the flow of high current during fault conditions and automatically reset when the fault is cleared and power to the circuit is removed. We also offer surface-mount fuses, surge protectors, gas discharge tubes for overvoltage protection, and electrostatic discharge protection devices.

•
Wire and Cable.   We provide highly engineered cable and wire products to the data transmission, aerospace, automotive, telecommunications, industrial, and medical markets. We offer a broad range of cable, including UTP and PVC ribbon cables, SCSI and IEEE 1394 computer cables, NASA-spec cable, and other cables suitable for use in the aerospace industry.

•
Touch Screens.   We develop, manufacture, and market a complete line of touch products for transactional kiosks, point-of-sale terminals, machine and process control, and automated teller machines. We offer component touch systems for original equipment manufacturers and a broad line of standard and custom LCD and CRT touch monitors. We believe that we are an industry leader in advancing surface wave, resistive, infrared, and capacitive technologies.

•
Application Tooling.   We offer a broad portfolio of hand tools, semi-automatic bench machines, and fully-automatic machine systems for processing terminal products.
        In addition to the above product families which represent in excess of 90% of the Electronic Components segment net sales, we also offer battery assemblies, identification products, antennas, magnetics, sensors, switches, and resistors.
Network Solutions
        Our Network Solutions segment is one of the world's largest suppliers of infrastructure components and systems for telecommunications and energy markets. These components include connectors, above and below-ground enclosures, heat shrink tubing, cable accessories, surge arrestors, fiber optic cabling, copper cabling, and racks for copper and fiber networks. This segment also provides electronic systems for test access and intelligent cross-connect applications as well as integrated cabling solutions for cabling and building management. The products are grouped into the following product families:
•
Connector Systems and Components.   We offer an extensive range of low, medium, and high-voltage connectors and splices, cable assemblies, sealing systems, terminals, fittings, lugs and clamps, transmission line fittings, splice closures, grounding hardware, and wall and floor outlets for voice and data connection to local area networks.

•
Heat Shrink Tubing.   We offer heat shrink tubing, heat-shrinkable splice closures, wrap-around sleeves, and molded parts designed to better protect both high and low-voltage circuits against harsh aerial, buried, and above-ground environments.

•
Fiber Optics.   We provide fiber optic connectors, splices, fiber optic splice closures, fiber management systems, high density cable assemblies, couplers and splitters, and complete cabling systems. These products find use in both local-area and wide-area networks, and emerging "Last-Mile" Fiber-to-the-Home installations.

•
Wire and Cable.   We provide wire and cable for indoor and outdoor use in office, factory floor, school, and residential voice, data, and video networks, including copper and fiber optic distribution cables, shielded and unshielded twisted-pair cables, armored cable, and patch cords.

•
Racks and Panels.   We provide racks and panels that are used to integrate, organize, and manage fiber and copper cables and splices, thereby simplifying installation, maintenance, and upgrades for both exchange/head end and customer premise environments.
5

        In addition to the above product families which represent in excess of 90% of the total Network Solutions segment net sales, the segment also sells insulators, surge arrestors, power measurement products, CATV accessories, network interface devices, raceway systems, and duct accessories.
Wireless Systems
        Our Wireless Systems segment is an innovator of wireless technology for critical communications, radar, and defense applications. The segment's products include radio frequency components and subassembly solutions such as silicon and gallium arsenide semiconductors, radar sensors, radio frequency identification components, microwave subsystems, and diodes and land mobile radio systems and related products. These products are sold primarily to the aerospace and defense, public safety, communication equipment, and automotive markets and are grouped into the following product families:
•
Land Mobile Radio Systems and Products.   We provide state-of-the-art two-way mobile radio technology products and systems. These systems and products are used primarily by public safety and government organizations.

•
Radio Frequency Components and Subassembly Solutions.   We produce amplifiers, antennas, attenuators, diodes, signal generation, limiters, transistors, modulators, mixers and microwave, and millimeter wave integrated circuits.
Undersea Telecommunications
        Our Undersea Telecommunications segment builds, designs, maintains, and tests undersea fiber optic networks for both the telecommunications and oil and gas markets.
Markets
        We sell our products to manufacturers and distributors in a number of major markets. The approximate percentage of our total net sales by market in fiscal 2007 was as follows:

Markets
	 	Percentage
	 	
Automotive	 	30	%	
Telecommunications	 	19	 	
Computer	 	8	 	
Energy	 	7	 	
Aerospace and Defense	 	5	 	
Appliance	 	4	 	
Industrial Machinery	 	4	 	
Consumer Electronics	 	2	 	
Other	 	21	 	
 	 		 	
Total	 	100	%	
 	 		 	
        Automotive.     The automotive industry uses our products in motor management systems, body electronic applications, safety systems, chassis systems, security systems, driver information, passenger entertainment, and comfort and convenience applications. Electronic components regulate critical vehicle functions, from fuel intake to braking, as well as information, entertainment, and climate control systems.
        Telecommunications.     Our products are used in telecommunications products, such as data networking equipment, switches, routers, wire line infrastructure equipment, wireless infrastructure equipment, wireless base stations, mobile phones, and undersea fiber optic telecommunication systems.
6

        Computer.     Our products are used in computer products, such as servers and storage equipment, workstations, notebook computers, desktop computers, and business and retail equipment.
        Energy.     The energy industry uses our products in power generation equipment and power transmission equipment. The industry has been investing heavily to improve, upgrade, and restore existing equipment and systems. In addition, this industry addresses the needs of emerging countries that are building out their energy infrastructure.
        Aerospace and Defense.     Our products are used in military and commercial aircraft, missile systems, satellites, space programs, and radar systems.
        Appliance.     Our products are used in many household appliances, including refrigerators, washers, dryers, dishwashers, and microwaves.
        Industrial Machinery.     Our products are used in factory automation and process control systems, photovoltaic systems, industrial motors and generators, and general industrial machinery and equipment.
        Consumer Electronics.     The consumer electronics industry uses our products to produce digital cameras, plasma and LCD televisions, electronic games, and DVD recorders and players.
        Other.     Our products are used in numerous products, including instrumentation and measurement equipment, medical equipment, commercial and building equipment, building network and cabling systems, and railway equipment. Other also includes products sold through third-party distributors.
Customers
        Our customers include automobile, telecommunication, computer, industrial, aerospace, and consumer products manufacturers that operate both globally and locally. Our customers also include contract manufacturers and third-party distributors. We serve over 200,000 customer locations in over 150 countries, and we maintain a strong local presence in each of the geographic areas in which we operate.
        Our net sales by geographic area as a percentage of our total net sales were as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Americas	 	37	%	38	%	39	%	
Europe/Middle East/Africa	 	36	 	35	 	36	 	
Asia-Pacific	 	27	 	27	 	25	 	
 	 		 		 		 	
Total	 	100	%	100	%	100	%	
 	 		 		 		 	
        We collaborate closely with our customers so that their product needs are met. There is no single customer that accounted for more than 10% of our net sales in fiscal 2007, 2006, or 2005. Our approach to our customers is driven by our dedication to further developing our product families and ensuring that we are globally positioned to best provide our customers with sales and engineering support. We believe that as electronic component technologies continue to proliferate, our broad product portfolio and engineering capability give us a potential competitive advantage when addressing the needs of our global customers.
Raw Materials
        We use a wide variety of raw materials in the manufacture of our products. The principal raw materials that we use include plastic resins for molding, precious metals such as gold and silver for plating, and other metals such as copper, aluminum, brass, steel for manufacturing cable, contacts, and
7

other parts that are used for cable and component bodies and inserts. These raw materials are generally available on world markets, and we purchase them from a limited number of suppliers in order to obtain the most competitive pricing. The prices of these materials are driven by global supply and demand dynamics. For many of these raw materials, the prices have continued to increase, as rapidly increasing demand has continued to outpace increases in supply.
Working Capital
        We consistently maintain an adequate level of working capital to support our business needs. There are no unusual industry practices or requirements relating to working capital items.
Research and Development
        We are engaged in both internal and external research and development in an effort to introduce new products, to enhance the effectiveness, ease of use, safety, and reliability of our existing products, and to expand the applications for which the uses of our products are appropriate. We continually evaluate developing technologies in areas where we may have technological or marketing expertise for possible investment or acquisition.
        Our research and development expense for fiscal 2007, 2006, and 2005 was as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
Electronic Components	 	$	341	 	$	302	 	$	286	
Network Solutions	 	 	56	 	 	50	 	 	34	
Wireless Systems	 	 	99	 	 	92	 	 	82	
Undersea Telecommunications	 	 	24	 	 	23	 	 	22	
 	 		 		 		
Total	 	$	520	 	$	467	 	$	424	
 	 		 		 		
        Our research, development, and engineering efforts are supported by approximately 8,000 engineers. These engineers work closely with our customers to develop application specific, highly engineered products and systems to satisfy the customers' needs. Our new products, including product extensions introduced during the past year, comprised approximately 15% of our net sales for fiscal 2007.
Sales, Marketing, and Distribution
        We sell our products into more than 150 countries, and we sell primarily through direct selling efforts. We also sell some of our products indirectly via third-party distributors. In fiscal 2007, our direct sales represented 84% of net sales, with the remainder of net sales provided by sales to third-party distributors and independent manufacturer representatives.
        We maintain distribution centers around the world. Products are generally delivered to these distribution centers by our manufacturing facilities and then subsequently delivered to the customer. In some instances, product is delivered directly from our manufacturing facility to the customer. We contract with a wide range of transport providers to deliver our products via road, rail, sea, and air.
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Seasonality and Backlog
        Customer orders typically fluctuate from quarter to quarter based upon business conditions and because unfilled orders may be canceled prior to shipment of goods. We experience a slight seasonal pattern to our business. The third fiscal quarter is typically the strongest quarter of our fiscal year, while the first fiscal quarter is negatively affected by winter holidays and the fourth fiscal quarter is negatively affected by European holidays. The second fiscal quarter is also affected by adverse winter weather conditions in certain of our end markets.
        Backlog by reportable segment at fiscal year end 2007 and 2006 was as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Electronics Components	 	$	1,663	 	$	1,513	
Network Solutions	 	 	277	 	 	249	
Wireless Systems	 	 	474	 	 	512	
Undersea Telecommunications	 	 	560	 	 	327	
 	 		 		
Total	 	$	2,974	 	$	2,601	
 	 		 		
        We expect that the majority of our backlog at September 28, 2007 will be filled during fiscal 2008.
Competition
        The industries in which we operate are highly competitive, and we compete with thousands of companies that range from large multinational corporations to local manufacturers. Competition is generally on the basis of breadth of product offering, product innovation, price, quality, and service. Our markets have generally been growing but with downward pressure on prices.
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Electronic Components .    This segment competes against numerous companies, including Molex, Amphenol, FCI, JST, and Omron.

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Network Solutions .    This segment's major competitors include Corning, Commscope, and 3M.

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Wireless Systems .    This segment's land mobile radio business competes primarily against Motorola. Our radio frequency component and subassembly products face a wide variety of competitors, including Herley, RF Micro Devices, Skyworks, and TriQuint.

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Undersea Telecommunications .    This segment primarily competes with Alcatel-Lucent.
Intellectual Property
        Patents and other proprietary rights are important to our business. We also rely upon trade secrets, manufacturing know-how, continuing technological innovations, and licensing opportunities to maintain and improve our competitive position. We review third-party proprietary rights, including patents and patent applications, as available, in an effort to develop an effective intellectual property strategy, avoid infringement of third-party proprietary rights, identify licensing opportunities, and monitor the intellectual property claims of others.
        We own a large portfolio of patents that principally relate to electrical and electronic products. We also own a portfolio of trademarks and are a licensee of various patents and trademarks. Patents for individual products extend for varying periods according to the date of patent filing or grant and the legal term of patents in the various countries where patent protection is obtained. Trademark rights may potentially extend for longer periods of time and are dependent upon national laws and use of the trademarks.
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        While we consider our patents and trademarks to be valued assets, we do not believe that our competitive position is dependent on patent or trademark protection or that our operations are dependent upon any single patent or group of related patents.
Employees
        As of September 28, 2007, we employed approximately 94,000 people worldwide, of whom 29,000 were in the Americas region, 27,000 were in the Europe/Middle East/Africa region, and 38,000 were in the Asia-Pacific region. Of our total employees, approximately 58,000 were employed in manufacturing and 22,000 were represented by collective bargaining agreements. Approximately 55% of our employees were based in low cost countries, primarily China. We believe that our relations with our employees are satisfactory.
Government Regulation and Supervision
        The import and export of products are subject to regulation by the United States and other countries. A small portion of our products, including defense-related products, may require governmental import and export licenses, whose issuance may be influenced by geopolitical and other events. We have a trade compliance organization and other systems in place to apply for licenses and otherwise comply with such regulations. Any failure to maintain compliance with domestic and foreign trade regulation could limit our ability to import and export raw materials and finished goods into or from the relevant jurisdiction.
Environmental
        We are committed to complying with all applicable environmental, health, and safety laws and to the protection of our employees and the environment. We maintain a global environmental, health, and safety program that includes appropriate policies and standards, staff dedicated to environmental, health, and safety issues, periodic compliance auditing, training, and other measures. We have a program for compliance with the European Union ("EU") RoHS and WEEE Directives, the China RoHS law, and similar laws.
        We have projects underway at a number of current and former manufacturing facilities to investigate and remediate environmental contamination resulting from past operations. Based upon our experience, current information and applicable laws, we believe that it is probable that we will incur remedial costs in the range of approximately $12 million to $23 million. As of September 28, 2007, we believe that the best estimate within this range is approximately $16 million.
Available Information
        All periodic and current reports, registration filings, and other filings that we are required to file with the Securities and Exchange Commission ("SEC"), including this Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") are available free of charge through our internet website at www.tycoelectronics.com . Such documents are available as soon as reasonably practicable after electronic filing or furnishing of the material with the SEC.
        The public may also read and copy any document that we file, including this Annual Report on Form 10-K, at the SEC's Public Reference Room at 100 F Street, N.E., Washington, DC 20549. Investors may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an internet site at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, from which investors can electronically access our SEC filings.
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 ITEM 1A.    RISK FACTORS
         You should carefully consider the risks described below before investing in our securities. The risks described below are not the only ones facing us. Our business is also subject to risks that affect many other companies, such as competition, technological obsolescence, labor relations, general economic conditions, geopolitical events, and international operations. Additional risks not currently known to us or that we currently believe are immaterial also may impair our business operations, financial condition, and liquidity.
Risks Relating to Our Business
        We face the following risks in connection with the general conditions and trends of our industry and the end markets we serve.
         We encounter competition in substantially all areas of the electronic components industry.
        We operate in highly competitive markets for electronic components. The competition we experience across product lines from other companies ranges in size from large, diversified manufacturers to small, highly specialized manufacturers. The electronic components industry has continued to become increasingly concentrated and globalized in recent years, and our major competitors have significant financial resources and technological capabilities. A number of these competitors compete with us primarily on price, and in some instances may enjoy lower production costs for certain products. We cannot assure you that additional competitors will not enter our markets, or that we will be able to compete successfully against existing or new competitors.
         We are dependent on market acceptance of new product introductions and product innovations for continued revenue growth.
        The markets in which we operate are subject to rapid technological change. Our long-term operating results depend substantially upon our ability to continually develop, introduce, and market new and innovative products, to modify existing products, to respond to technological change, and to customize certain products to meet customer requirements. There are numerous risks inherent in this process, including the risks that we will be unable to anticipate the direction of technological change or that we will be unable to develop and market new products and applications in a timely fashion to satisfy customer demands.
         Like other suppliers to the electronics industry, we are subject to continuing pressure to lower our prices.
        Over the past several years we have experienced, and we expect to continue to experience, pressure each year to lower our prices. In recent years, we have experienced price erosion averaging from 2% to 4%. In order to maintain our margins, we must continue to reduce our costs by similar amounts. We cannot assure you that continuing pressures to reduce our prices will not have a material adverse effect on our financial condition, results of operations, and cash flows.
         The life cycles of our products can be very short.
        The life cycles of certain of our products can be very short relative to the development cycles. As a result, the resources devoted to product sales and marketing may not result in material revenue, and, from time to time, we may need to write off excess or obsolete inventory or equipment. If we were to incur significant engineering expenses and investments in inventory and equipment that we were not able to recover and we were not able to compensate for those expenses, our financial condition, results of operations, and cash flows would be materially and adversely affected.
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         Divestitures of some of our businesses or product lines may materially adversely affect our financial condition, results of operations, and cash flows.
        In addition to our announced divestiture of Power Systems, we continue to evaluate the performance of all of our businesses and may sell businesses or product lines. Any divestitures may result in significant write-offs, including those related to goodwill and other intangible assets, which could have a material adverse effect on our financial condition, results of operations, and cash flows. Divestitures could involve additional risks, including difficulties in the separation of operations, services, products and personnel, the diversion of management's attention from other business concerns, the disruption of our business, and the potential loss of key employees. There can be no assurance that we will be successful in addressing these or any other significant risks encountered.
         We may be negatively affected as our customers and vendors continue to consolidate their supply base.
        Many of the industries to which we sell our products, as well as many of the industries from which we buy materials, have become increasingly concentrated in recent years, including the automotive, telecommunications, computer, and aerospace and defense industries. As our customers buy in larger volumes, their volume buying power has increased, and they have been able to negotiate more favorable pricing and find alternative sources from which to purchase. Our materials suppliers similarly have increased their ability to negotiate favorable pricing. These trends may adversely affect the profit margins on our products, particularly for commodity components.
         We are dependent on the automotive industry.
        Approximately 30% of our net sales for fiscal 2007 were to customers in the automotive industry. The automotive market is dominated by several large manufacturers that can exert significant price pressure on their suppliers.
        In addition, as a supplier of automotive electronics products, our sales of these products and our profitability could be negatively affected by changes in the operations, products, business models, part-sourcing requirements, financial condition, and market share of automobile manufacturers. Demand for our automotive products also is linked to consumer demand for automobiles, which may be adversely affected by negative trends in consumer demand.
         We are dependent on the telecommunications, computer, and consumer electronics industries.
        Approximately 19% of our net sales for fiscal 2007 came from sales to the telecommunications industry. Demand for these products is subject to rapid technological change. These markets are dominated by several large manufacturers who can exert significant price pressure on their suppliers. There can be no assurance that we will be able to continue to compete successfully in the telecommunications industry, and our failure to do so would materially impair our financial condition, results of operations, and cash flows.
        Approximately 10% of our net sales for fiscal 2007 came from sales to the computer and consumer electronics industries. Demand for our computer and consumer electronics products depends primarily on underlying business and consumer demand for new computer and consumer electronics products. The amount of this demand and therefore our sales and profitability will be affected by a variety of factors, including the rate of technological change, degree of consumer acceptance of new products, and general economic conditions. We cannot assure you that existing levels of business and consumer demand for new computer and consumer electronics products will not decrease.
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         Cyclical industry and economic conditions may adversely affect our financial condition, results of operations, and cash flows.
        We are heavily dependent on the end-market industry dynamics for our products, and our operating results can be adversely affected by the cyclical demand patterns of these markets. For example, the telecommunications industry, which accounted for approximately 19% of our net sales in fiscal 2007, has historically experienced periods of robust capital expenditure followed by periods of retrenchment and consolidation. The aerospace and defense industry, which accounted for 5% of our net sales in fiscal 2007, has similarly undergone significant fluctuations in demand, depending on worldwide economic and political conditions. These periodic downturns in our customers' industries can significantly reduce demand for certain of our products, which could have a material adverse effect on our financial condition, results of operations, and cash flows.
         Our results are sensitive to raw material availability, quality, and cost.
        We are a large buyer of resin, copper, gold, brass, steel, chemicals and additives, and zinc. Many of these raw materials are produced in a limited number of regions around the world or are only available from a limited number of suppliers. In addition, the price of many of these raw materials, including copper and gold, has increased dramatically in recent years. Over the last three years, we have only been able partially to offset these increases through higher selling prices. Our financial condition, results of operations, and cash flows may be materially and adversely affected if we have difficulty obtaining these raw materials, the quality of available raw materials deteriorates, or there are continued significant price increases for these raw materials. Any of these events could have a substantial impact on the price we pay for raw materials and, to the extent we cannot compensate for cost increases through productivity improvements or price increases to our customers, our margins may decline, materially affecting our financial condition, results of operations, and cash flows.
         Foreign currency exchange rates may adversely affect our results.
        We are exposed to a variety of market risks, including the effects of changes in foreign currency exchange rates. Approximately 67% of our net sales for fiscal 2007 were derived from sales in non-U.S. markets, and we expect revenue from non-U.S. markets to continue to represent a significant portion of our net revenue. Therefore, when the U.S. dollar strengthens in relation to the currencies of the countries where we sell our products, such as the euro, our U.S. dollar reported revenue and income will decrease. Changes in the relative values of currencies occur from time to time and, in some instances, may have a significant effect on our financial condition, results of operations, and cash flows. We manage this risk in part by entering into financial derivative contracts. In addition to the risk of non-performance by the counterparty to the contracts, our efforts to manage these risks might not be successful.
         We may use components and products manufactured by third parties.
        We may rely on third-party suppliers for the components used in our products, and we may rely on third-party manufacturers to manufacture certain of our assemblies and finished products. Our financial condition, results of operations, and cash flows could be adversely affected if such third parties lack sufficient quality control or if there are significant changes in their financial or business condition. We also have third-party arrangements for the manufacture of certain products, parts, and components. If these third parties fail to deliver quality products, parts, and components on time and at reasonable prices, we could have difficulties fulfilling our orders, sales and profits could decline, and our commercial reputation could be damaged.
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         Our future success is substantially dependent on our ability to attract and retain highly qualified technical, managerial, marketing, finance, and administrative personnel.
        Our success depends upon our continued ability to hire and retain key employees at our operations around the world. We depend on highly skilled technical personnel to design, manufacture, and support our wide range of electronic components. Additionally, we rely upon experienced managerial, marketing, and support personnel to manage our business effectively and to successfully promote our wide range of products. Any difficulties in obtaining or retaining the necessary global management, technical, and human resource skills to achieve our objectives may have adverse affects on our financial condition, results of operations, and cash flows.
         If any of our operations are found not to comply with applicable antitrust or competition laws, our business may suffer.
        Our operations are subject to applicable antitrust and competition laws in the jurisdictions in which we conduct our business, in particular the United States and the European Union. These laws prohibit, among other things, anticompetitive agreements and practices. If any of our commercial, including distribution, agreements and practices with respect to the electrical components or other markets is found to violate or infringe such laws, we may be subject to civil and other penalties. We also may be subject to third party claims for damages. Further, agreements that infringe these antitrust and competition laws may be void and unenforceable, in whole or in part, or require modification in order to be lawful and enforceable. If we are unable to enforce any of our commercial agreements, whether at all or in material part, our financial condition, results of operations, and cash flows could be adversely affected.
         We are subject to the risks of political, economic, and military instability in countries outside the United States.
        Non-U.S. markets account for a substantial portion of our business. During fiscal 2007, non-U.S. markets constituted over 67% of our net sales. We employ more than 77% of our workforce outside the United States. Our customers are located throughout the world and we have many manufacturing, administrative, and sales facilities outside the United States. Because of our extensive non-U.S. operations, we are exposed to risks that could negatively affect sales or profitability, including:
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tariffs, trade barriers, and trade disputes;

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regulations related to customs and import/export matters;

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longer payment cycles;

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tax issues, such as tax law changes, examinations by taxing authorities, variations in tax laws from country to country as compared to the United States, and difficulties in repatriating in a tax-efficient manner cash generated or held abroad;

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challenges in collecting accounts receivable;

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employment regulations and local labor conditions;

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difficulties protecting intellectual property;

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instability in economic or political conditions, including inflation, recession, and actual or anticipated military or political conflicts; and

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the impact of each of the foregoing on our outsourcing and procurement arrangements.
        Many of our products that are manufactured outside of the United States are manufactured in Asia. In particular, we have sizeable operations in China, including manufacturing operations, and in fiscal 2007 12% of our net sales were made to customers in China. The legal system in China is still
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developing and is subject to change. Accordingly, our operations and orders for products in China could be adversely affected by changes to or interpretation of Chinese law.
         We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar worldwide anti-bribery laws.
        The U.S. Foreign Corrupt Practices Act ("FCPA") and similar worldwide anti-bribery laws generally prohibit companies and their intermediaries from making improper payments to non-U.S. officials for the purpose of obtaining or retaining business. Our policies mandate compliance with these anti-bribery laws. We operate in many parts of the world that have experienced governmental corruption to some degree and in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices. Despite our training and compliance program, we cannot assure you that our internal control policies and procedures always will protect us from reckless or criminal acts committed by our employees or agents. Violations of these laws, or allegations of such violations, could disrupt our business and result in a material adverse effect on our financial condition, results of operations, and cash flows.
         Our operations expose us to the risk of material environmental liabilities, litigation, and violations.
        We are subject to numerous federal, state, local, and non-U.S. environmental protection and health and safety laws governing, among other things:
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the generation, storage, use, and transportation of hazardous materials;

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emissions or discharges of substances into the environment;

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investigation and remediation of hazardous substances or materials at various sites; and

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the health and safety of our employees.
        We may not have been, or we may not at all times be, in compliance with environmental and health and safety laws. If we violate these laws, we could be fined, criminally charged, or otherwise sanctioned by regulators. Environmental laws outside of the United States are becoming more stringent, resulting in increased costs and compliance burdens.
        Certain environmental laws assess liability on current or previous owners or operators of real property for the costs of investigation, removal, or remediation of hazardous substances or materials at their properties or at properties at which they have disposed of hazardous substances. Liability for investigative, removal, and remedial costs under certain federal and state laws are retroactive, strict, and joint and several. In addition to cleanup actions brought by governmental authorities, private parties could bring personal injury or other claims due to the presence of, or exposure to, hazardous substances. We have received notification from the U.S. Environmental Protection Agency and similar state environmental agencies that conditions at a number of formerly owned sites where we and others have disposed of hazardous substances require investigation, cleanup, and other possible remedial action and may require that we reimburse the government or otherwise pay for the costs of investigation and remediation and for natural resource damage claims from such sites.
        While we plan for future capital and operating expenditures to maintain compliance with environmental laws, we cannot assure you that our costs of complying with current or future environmental protection and health and safety laws, or our liabilities arising from past or future releases of, or exposures to, hazardous substances will not exceed our estimates or adversely affect our financial condition and results of operations or that we will not be subject to additional environmental claims for personal injury or cleanup in the future based on our past, present, or future business activities.
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         Our products are subject to various requirements related to chemical usage, hazardous material content, and recycling.
        The EU, China, and other jurisdictions in which our products are sold have enacted or are proposing to enact laws addressing environmental and other impacts from product disposal, use of hazardous materials in products, use of chemicals in manufacturing, recycling of products at the end of their useful life, and other related matters. These laws include the EU Restriction on Hazardous Substances, End of Life Vehicle and Waste Electrical and Electronic Equipment Directives, the EU REACH (chemical registration) Directive, the China law on Management Methods for Controlling Pollution by Electronic Information Products, and various other laws. These laws prohibit the use of certain substances in the manufacture of our products and directly and indirectly impose a variety of requirements for modification of manufacturing processes, registration, chemical testing, labeling, and other matters. We cannot predict the extent to which these laws will proliferate in other jurisdictions or expand to address other materials or other aspects of our product manufacturing and sale. These laws could make manufacture or sale of our products more expensive or impossible and could limit our ability to sell our products in certain jurisdictions.
         We are a defendant to a variety of litigation in the course of our business that could cause a material adverse effect on our financial condition, results of operations, and cash flows.
        In the ordinary course of business, we are a defendant in litigation, including litigation alleging the infringement of intellectual property rights, anti-competitive behavior, and product liability. In certain circumstances, patent infringement and anti-trust laws permit successful plaintiffs to recover treble damages. The defense of these lawsuits may divert our management's attention, and we may incur significant expenses in defending these lawsuits. In addition, we may be required to pay damage awards or settlements, or become subject to injunctions or other equitable remedies, that could cause a material adverse effect on our financial condition, results of operations, and cash flows.
         Covenants in our debt instruments may adversely affect us.
        Our bank credit agreements contain financial and other covenants, such as a limit on the ratio of debt to earnings before interest, taxes, depreciation and amortization, and limits on subsidiary debt and incurrence of liens. Our outstanding indentures contain customary covenants including limits on incurrence of liens, sale and lease-back transactions, and our ability to consolidate, merge, and sell assets.
        Although we believe none of these covenants are presently restrictive to our operations, our ability to meet the financial covenant can be affected by events beyond our control, and we cannot provide assurance that we will continue to comply with the covenant. A breach of any of these covenants could result in a default under our credit agreements or indentures. Upon the occurrence of certain defaults under our credit facilities and indentures, the lenders or trustee could elect to declare all amounts outstanding thereunder to be immediately due and payable and our lenders could terminate commitments to extend further credit under our bank credit facility. If the lenders or trustee accelerate the repayment of borrowings, we cannot provide assurance that we will have sufficient assets to repay our credit facilities and our other affected indebtedness. Acceleration of any debt obligation under any of our material debt instruments may permit the holders or trustee of our other material debt to accelerate payment of debt obligations to the creditors thereunder.
        Our indentures governing our outstanding senior notes contain covenants that may require us to offer to buy back the notes for a price equal to 101% of the principal amount, plus accrued and unpaid interest, to the repurchase date, upon a change of control triggering event (as defined in the indentures). We cannot assure you that we will have sufficient funds available to repurchase the notes in that event, which could result in a default under the notes. Any future debt that we incur may contain covenants regarding repurchases in the event of a change of control triggering event.
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         Downgrades of our debt ratings could adversely affect us.
        Certain downgrades by Moody's, Standard & Poor's, and Fitch may increase our cost of borrowing and make it more difficult for us to obtain new financing.
         Future acquisitions may not be successful.
        We will continue to investigate the acquisition of strategic businesses or product lines with the potential to strengthen our market position or enhance our existing product offering. We cannot assure you, however, that we will identify or successfully complete transactions with suitable acquisition candidates in the future. Nor can we assure you that completed acquisitions will be successful. If an acquired business fails to operate as anticipated or cannot be successfully integrated with our existing business, our financial condition, results of operations, and cash flows could be materially and adversely affected.
         Future acquisitions could require us to issue additional debt or equity.
        If we were to undertake a substantial acquisition for cash, the acquisition would likely need to be financed in part through additional financing from banks, through public offerings or private placements of debt or equity securities, or other arrangements. This acquisition financing might decrease our ratio of earnings to fixed charges and adversely affect other leverage measures. We cannot assure you that the necessary acquisition financing would be available to us on acceptable terms if and when required. If we were to undertake an acquisition by issuing equity securities or equity-linked securities, the issued securities may have a dilutive effect on the interests of the holders of our common shares.
         Our ability to compete effectively depends, in part, on our ability to maintain the proprietary nature of our technology.
        The electronics industry is characterized by litigation regarding patent and other intellectual property rights. Within this industry, companies have become more aggressive in asserting and defending patent claims against competitors. There can be no assurance that we will not be subject to future litigation alleging intellectual property rights infringement or that we will not pursue litigation to protect our property rights. Depending on the size and importance of the patent or trademark in question, an unfavorable outcome regarding one of these matters may have a material adverse effect on our financial condition, results of operations, and cash flows.
Risks Relating to Our Separation from Tyco International
         Our historical combined financial information is not necessarily representative of the results we would have achieved as an independent, publicly-traded company and may not be a reliable indicator of our future results.
        Our historical combined financial information for periods prior to our separation from Tyco International does not necessarily reflect the financial condition, results of operations, or cash flows that we would have achieved as an independent, publicly-traded company during the periods presented or those that we will achieve in the future, primarily as a result of the following factors:
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Prior to our separation, our business was operated by Tyco International as part of its broader corporate organization, rather than as an independent, publicly-traded company. In addition, prior to our separation, Tyco International and its affiliates performed significant corporate functions for us, including tax and treasury administration and certain governance functions, including internal audit and external reporting. Our historical Combined Financial Statements reflect allocations of corporate expenses from Tyco International for these and similar functions.
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•
Our working capital requirements and capital for our general corporate purposes, including acquisitions and capital expenditures, historically were satisfied as part of the company-wide cash management practices of Tyco International. As an independent company, we must obtain financing from banks, through public offerings or private placements of debt or equity securities, or other arrangements.

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Other significant changes may occur in our cost structure, management, financing, and business operations because we are operating as a company separate from Tyco International.
         We are responsible for a portion of Tyco International's contingent and other corporate liabilities, including those relating to shareholder litigation.
        Under the Separation and Distribution Agreement and other agreements, subject to certain exceptions contained in the Tax Sharing Agreement, we, Covidien Ltd. ("Covidien"), and Tyco International have agreed to assume and be responsible for 31%, 42%, and 27%, respectively, of certain of Tyco International's contingent and other corporate liabilities. All costs and expenses associated with the management of these contingent and other corporate liabilities are shared equally among the parties. These contingent and other corporate liabilities primarily relate to consolidated securities litigation, any actions with respect to the separation plan or the distribution brought by any third party and tax liabilities for periods prior to and including the distribution date, June 29, 2007. For more information on the contingent tax liabilities, see "We share responsibility for certain of our, Tyco International's, and Covidien's income tax liabilities for tax periods prior to and including the distribution date." Contingent and other corporate liabilities do not include liabilities that are specifically related to one of the three separated companies, which were allocated 100% to the relevant company.
        If any party responsible for such liabilities were to default in its payment, when due, of any of these assumed obligations, each non-defaulting party would be required to pay equally with any other non-defaulting party the amounts in default. Accordingly, under certain circumstances, we may be obligated to pay amounts in excess of our agreed-upon share of the assumed obligations related to such contingent and other corporate liabilities, including associated costs and expenses.
        Many lawsuits are outstanding against Tyco International, some of which relate to actions taken by Tyco International's former senior corporate management. On May 14, 2007, Tyco International entered into a proposed settlement with respect to most of its outstanding securities class action litigation. We do not believe that it is feasible to predict the final outcome or resolution of the unresolved proceedings. Although we will share any costs and expenses arising out of this litigation and any settlement thereof with Tyco International and Covidien, a failure to consummate the proposed settlement on the agreed terms or an adverse outcome from the unresolved proceedings or liabilities or other proceedings for which we have assumed joint and several liability under the Separation and Distribution Agreement could be material with respect to our financial condition, results of operations, and cash flows in any given reporting period.
        Tyco International has the right to control the defense and settlement of the class action settlement and other outstanding litigation, subject to certain limitations. The timing, nature, and amount of the class action settlement or any other settlement may not be in our best interests. Furthermore, in the event of any subsequent settlement, we may have limited notice before we would be required to pay our portion of the settlement amount. Moreover, Tyco International stipulated, pursuant to a court order, that we, Tyco International, and Covidien each will be primarily liable for a portion of the obligations arising from the Tyco International shareholder litigation. The stipulation also provides that if any party defaults on its obligations, the other parties are jointly and severally liable for the defaulting party's obligations. In accordance with the stipulation, we, Covidien, and Tyco International agreed to assume and be responsible for 31%, 42%, and 27%, respectively, of the obligations arising from the Tyco International shareholder litigation.
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         We share responsibility for certain of our, Tyco International's and Covidien's income tax liabilities for tax periods prior to and including the distribution date.
        Under the Tax Sharing Agreement, we share responsibility for certain of our, Tyco International's, and Covidien's income tax liabilities based on a sharing formula for periods prior to and including June 29, 2007. More specifically, we, Tyco International and Covidien share 31%, 27%, and 42%, respectively, of U.S. income tax liabilities that arise from adjustments made by tax authorities to our, Tyco International's, and Covidien's U.S. income tax returns, certain income tax liabilities arising from adjustments made by tax authorities to intercompany transactions or similar adjustments, and certain taxes attributable to internal transactions undertaken in anticipation of the separation. All costs and expenses associated with the management of these shared tax liabilities will be shared equally among the parties. We are responsible for all of our own taxes that are not shared pursuant to the Tax Sharing Agreement's sharing formula. In addition, Tyco International and Covidien are responsible for their tax liabilities that are not subject to the Tax Sharing Agreement's sharing formula.
        All the tax liabilities that are associated with our businesses, including liabilities that arose prior to our separation from Tyco International, have become our tax liabilities. Although we have agreed to share certain of these tax liabilities with Tyco International and Covidien pursuant to the Tax Sharing Agreement, we remain primarily liable for all of these liabilities. If Tyco International and Covidien default on their obligations to us under the Tax Sharing Agreement, we would be liable for the entire amount of these liabilities.
        If any party to the Tax Sharing Agreement were to default in its obligation to another party to pay its share of the distribution taxes that arise as a result of no party's fault, each non-defaulting party would be required to pay, equally with any other non-defaulting party, the amounts in default. In addition, if another party to the Tax Sharing Agreement that is responsible for all or a portion of an income tax liability were to default in its payment of such liability to a taxing authority, we could be legally liable under applicable tax law for such liabilities and required to make additional tax payments. Accordingly, under certain circumstances, we may be obligated to pay amounts in excess of our agreed-upon share of our, Tyco International's, and Covidien's tax liabilities.
        Our, Tyco International's, and Covidien's income tax returns are examined periodically by various tax authorities. In connection with such examinations, tax authorities, including the U.S. Internal Revenue Service ("IRS"), have raised issues and proposed tax adjustments. We are reviewing and contesting certain of the proposed tax adjustments. Amounts related to these tax adjustments and other tax contingencies that we have assessed as probable and estimable have been reflected as a liability in the Consolidated and Combined Financial Statements. The calculation of our tax liabilities involves dealing with the uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We recognize potential liabilities and record tax liabilities for anticipated tax audit issues in the United States and other tax jurisdictions based on our estimate of whether, and the extent to which, additional income taxes will be due. These tax liabilities are reflected net of related tax loss carryforwards. We adjust these liabilities in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of tax liabilities.
        Under the Tax Sharing Agreement, Tyco International has the right to administer, control, and settle all U.S. income tax audits for periods prior to and including June 29, 2007. The timing, nature, and amount of any settlement agreed to by Tyco International may not be in our best interests. Moreover, the other parties to the Tax Sharing Agreement will be able to remove Tyco International as the controlling party only under limited circumstances, including a change of control or bankruptcy of Tyco International, or by a majority vote of the parties on or after the second anniversary of the distribution. All other tax audits will be administered, controlled, and settled by the party that would be responsible for paying the tax.
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         The ownership by our executive officers and some of our directors of common shares, options, or other equity awards of Tyco International or Covidien may create, or may create the appearance of, conflicts of interest.
        Because of their former positions with Tyco International, substantially all of our executive officers, including our Chief Executive Officer and our Chief Financial Officer, and one of our non-employee directors, own common shares of Tyco International, options to purchase common shares of Tyco International, or other Tyco International equity awards, as well as common shares, options to purchase common shares, and other equity awards of Covidien. The individual holdings of common shares, options to purchase common shares, or other equity awards of Tyco International and Covidien may be significant for some of these persons compared to their total assets. These equity interests may create, or appear to create, conflicts of interest when these directors and officers are faced with decisions that could benefit or affect the equity holders of Tyco International or Covidien in ways that do not benefit or affect us in the same manner.
         If the distribution or certain internal transactions undertaken in anticipation of the separation are determined to be taxable for U.S. federal income tax purposes, we could incur significant U.S. federal income tax liabilities.
        Tyco International received private letter rulings from the IRS regarding the U.S. federal income tax consequences of the distribution of our common shares and Covidien common shares to the Tyco International shareholders substantially to the effect that the distribution, except for cash received in lieu of a fractional share of our common shares and the Covidien common shares, will qualify as tax-free under Sections 368(a)(1)(D) and 355 of the Internal Revenue Code (the "Code"). The private letter rulings also provided that certain internal transactions undertaken in anticipation of the separation would qualify for favorable treatment under the Code. In addition to obtaining the private letter rulings, Tyco International obtained opinions from the law firm of McDermott Will & Emery LLP confirming the tax-free status of the distribution and certain internal transactions. The private letter rulings and the opinions relied on certain facts and assumptions, and certain representations and undertakings, from us, Covidien, and Tyco International regarding the past and future conduct of our respective businesses and other matters. Notwithstanding the private letter rulings and the opinions, the IRS could determine on audit that the distribution or the internal transactions should be treated as taxable transactions if it determines that any of these facts, assumptions, representations, or undertakings are not correct or have been violated, or that the distributions should be taxable for other reasons, including as a result of significant changes in stock or asset ownership after the distribution. If the distribution ultimately is determined to be taxable, Tyco International would recognize gain in an amount equal to the excess of the fair market value of our common shares and Covidien common shares distributed to Tyco International shareholders on the distribution date over Tyco International's tax basis in such common shares, but such gain, if recognized, generally would not be subject to U.S. federal income tax. However, we would incur significant U.S. federal income tax liabilities if it is ultimately determined that certain internal transactions undertaken in anticipation of the separation should be treated as taxable transactions.
        In addition, under the terms of the Tax Sharing Agreement, in the event the distribution or the internal transactions were determined to be taxable and such determination was the result of actions taken after the distribution by us, Covidien, or Tyco International, the party responsible for such failure would be responsible for all taxes imposed on us, Covidien, or Tyco International as a result thereof. If such determination is not the result of actions taken after the distribution by us, Covidien, or Tyco International, then we, Covidien, and Tyco International would be responsible for 31%, 42%, and 27%, respectively, of any taxes imposed on us, Covidien, or Tyco International as a result of such determination. Such tax amounts could be significant. In the event that any party to the Tax Sharing Agreement defaults in its obligation to pay distribution taxes to another party that arise as a result of no party's fault, each non-defaulting party would be responsible for an equal amount of the defaulting party's obligation to make a payment to another party in respect of such other party's taxes.
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         In some cases, we might have received better terms from unaffiliated third parties than the terms we received in our agreements with Tyco International and Covidien.
        The agreements related to our separation from Tyco International and Covidien, including the Separation and Distribution Agreement and the Tax Sharing Agreement, were negotiated in the context of our separation from Tyco International while we were still part of Tyco International and, accordingly, may not reflect terms that would have resulted from arm's-length negotiations among unaffiliated third parties. The separation agreements were approved in consideration of the best interests of Tyco International's shareholders and may conflict with the interests of our securityholders.
         If we fail to comply with the requirements of Section 404 of Sarbanes-Oxley, our business prospects and the value of our securities could be adversely affected.
        Under the rules and regulations of the SEC, we are not required to comply with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 until we file our Annual Report on Form 10-K for our fiscal year ending September 26, 2008, so long as we continue to meet the definition of a non-accelerated filer. In our Annual Report on Form 10-K for the fiscal year ending September 26, 2008, management and our independent registered public accounting firm will be required to report on the effectiveness of our internal control over financial reporting. If we are unable to comply with these obligations or experience delays in reports of our management and outside auditors on our internal control over financial reporting, we might be unable to file timely with the SEC our annual or periodic reports and might be subject to regulatory and enforcement actions by the SEC and the New York Stock Exchange ("NYSE"), including delisting from the NYSE, securities litigation, events of default under our credit agreements, debt rating agency downgrades or rating withdrawals, and a general loss of investor confidence, any one of which could adversely affect the value of our securities and could adversely affect our business prospects.
        Subsequent to the filing of our Combined Financial Statements for fiscal 2006, 2005, and 2004 in the initial filing of our registration statement on Form 10 with the SEC, we determined that our Combined Financial Statements contained certain errors. The errors primarily resulted from the process of carving out certain income tax accounts from Tyco International's consolidated financial statements and related information. We substantially relied upon the processes at Tyco International to prepare our carve-out accounts for income taxes. We have determined that certain of those tax processes utilized by Tyco International in determining certain carve-out amounts for income taxes did not operate at a sufficient level of precision relative to our materiality for us to ensure that the carve-out accounts were materially correct. Concurrently, we determined that we did not have sufficient control processes in place to ensure that the information provided by Tyco International was complete and accurate and have concluded that the absence of these control processes was a material weakness in our internal control over financial reporting relating to income taxes.
        As of September 28, 2007, we evaluated the effectiveness of our disclosure controls and procedures and concluded the material weakness in our internal controls over financial reporting relating to accounting for income taxes has not been fully remediated.
        We are continuing to build our tax accounting resources and capabilities to remediate this material weakness, and are implementing new control processes and procedures as part of our efforts to become compliant with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002.
         We might not be able to engage in desirable strategic transactions and equity issuances because of restrictions relating to U.S. federal income tax requirements for tax-free distributions.
        Our ability to engage in significant equity transactions could be limited or restricted in order to preserve for U.S. federal income tax purposes the tax-free nature of the distribution by Tyco International. Similar limitations and restrictions apply to Covidien and Tyco International. The distribution may result in corporate level taxable gain to Tyco International under Section 355(e) of the Code if 50% or more, by vote or value, of our common shares, Covidien's common shares, or Tyco
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International's common shares are acquired or issued as part of a plan or series of related transactions that includes the distribution. For this purpose, any acquisitions or issuances of Tyco International's common shares within two years before the distribution, and any acquisitions or issuances of our common shares, Covidien's common shares, or Tyco International's common shares within two years after the distribution, generally are presumed to be part of such a plan, although we, Covidien, or Tyco International may be able to rebut that presumption. We are not aware of any such acquisitions or issuances of Tyco International's common shares within the two years before the distribution. If an acquisition or issuance of our common shares, Covidien's common shares, or Tyco International's common shares triggers the application of Section 355(e) of the Code, Tyco International would recognize taxable gain as described above, but such gain generally would not be subject to U.S. federal income tax. However, certain subsidiaries of Covidien or Tyco International or subsidiaries of ours would incur significant U.S. federal income tax liabilities as a result of the application of Section 355(e) of the Code.
        Under the Tax Sharing Agreement, there are restrictions on our ability to take actions that could cause the distribution or certain internal transactions undertaken in anticipation of the separation to fail to qualify as tax-favored transactions, including entering into, approving, or allowing any transaction that results in a change in ownership of more than 35% of our common shares, a redemption of equity securities, a sale or other disposition of a substantial portion of our assets, an acquisition of a business or assets with equity securities to the extent one or more persons would acquire 35% or more of our common shares, or engaging in certain internal transactions. These restrictions apply for the two-year period after the distribution, unless we obtain the consent of the other parties or we obtain a private letter ruling from the IRS or an unqualified opinion of a nationally recognized law firm that such action will not cause the distribution or the internal transactions undertaken in anticipation of the separation to fail to qualify as tax-favored transactions, and such letter ruling or opinion, as the case may be, is acceptable to the parties. Covidien and Tyco International are subject to similar restrictions under the Tax Sharing Agreement. Moreover, the Tax Sharing Agreement generally provides that a party thereto is responsible for any taxes imposed on any other party thereto as a result of the failure of the distribution or certain internal transactions to qualify as a tax-favored transaction under the Code if such failure is attributable to certain post-distribution actions taken by or in respect of the responsible party or its shareholders, regardless of whether the actions occur more than two years after the distribution, the other parties consent to such actions or such party obtains a favorable letter ruling or opinion of tax counsel as described above. For example, we would be responsible for a third party's acquisition of us at a time and in a manner that would cause such failure. These restrictions may prevent us from entering into transactions which might be advantageous to our securityholders.
Risks Relating to Our Jurisdictions of Incorporation
         Legislation and negative publicity regarding Bermuda companies could increase our tax burden and adversely affect our financial condition, results of operations, and cash flows.
Tax Legislation
        We continue to assess the impact of various U.S. federal and state legislative proposals, and modifications to existing tax treaties between the United States and foreign countries, that could result in a material increase in our U.S. federal and state taxes. The U.S. Congress has in the past considered legislation affecting the tax treatment of U.S. companies that have undertaken certain types of expatriation transactions or companies' use of or relocation to offshore jurisdictions, including Bermuda. In October 2004, the U.S. Congress enacted such legislation, which did not, however, retroactively apply to us. We continue to assess the impact of the potential for U.S. federal legislative proposals relating to deductible payments from U.S. subsidiaries to foreign parents, as well as the impact of a recently released U.S. Treasury Department study. Concern about such deductible payments could result in tax proposals being introduced or modified in the U.S. Congress in the future and we
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cannot assure you that these proposals would not have adverse effects on us if enacted. Such adverse effects could include substantially reducing the tax benefits of our corporate structure, materially increasing our tax burden or otherwise adversely affecting our financial condition, results of operations, and cash flows.
Negative Publicity
        There is continuing negative publicity regarding, and criticism of, U.S. companies' use of, or relocation to, offshore jurisdictions, including Bermuda. As a Bermuda company, this negative publicity could harm our reputation and impair our ability to generate new business if companies or governmental agencies decline to do business with us as a result of any perceived negative public image of Bermuda companies or the possibility of our customers receiving negative media attention from doing business with a Bermuda company.
Legislation Relating to Governmental Contracts
        Various U.S. federal and state legislative proposals that would deny governmental contracts to U.S. companies that move their corporate location abroad may affect us.
        The U.S. federal government and various states and municipalities have proposed or may propose legislation that would deny governmental contracts to U.S. companies that move their corporate location abroad. We are unable to predict the likelihood that, or final form in which, any such proposed legislation might become law, the nature of regulations that may be promulgated under any future legislative enactments, or the effect such enactments and increased regulatory scrutiny may have on our business.
        We are unable to predict whether the final form of the proposed legislation discussed above also would affect our indirect sales to the U.S. federal or state governments or the willingness of our non-governmental customers to do business with us. As a result of these uncertainties, we are unable to assess the potential impact on us of any proposed legislation in this area and cannot assure you that the impact will not be materially adverse.
         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 obtained in the United States against us in Bermuda based on the civil liability provisions of the U.S. federal or state securities laws. In addition, there is some uncertainty as to whether the courts of Bermuda would recognize or enforce judgments of U.S. courts obtained against us or our directors or officers based on the civil liabilities provisions of the U.S. federal or state securities laws or hear actions against us or those persons based on those laws. We have been advised that the United States and Bermuda currently do not 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.
        As a Bermuda company, we are governed by the Companies Act 1981 of Bermuda, which differs in some material respects from laws generally applicable to United States corporations and shareholders, including differences relating to interested director and officer transactions, shareholder lawsuits, and indemnification. Likewise, the duties of directors and officers of a Bermuda company generally are owed to the company only. Shareholders of Bermuda companies generally do not have a personal right of action against directors or officers of the company and may exercise such rights of action on behalf of the company only in limited circumstances. Under Bermuda law, a company also may agree to indemnify directors and officers for any personal liability, not involving fraud or dishonesty, incurred in relation to the company. Thus, holders of our securities may have more
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difficulty protecting their interests than would holders of securities of a corporation incorporated in a jurisdiction of the United States.
Risks Relating to Our Common Shares
         The market price of our common shares may fluctuate widely.
        The market price of our common shares may fluctuate widely, depending upon many factors, including:
•
our quarterly or annual earnings;

•
changes in quarterly or annual sales or earnings guidance that we may provide;

•
actual or anticipated fluctuations in our operating results;

•
changes in accounting standards, policies, guidance, interpretations, or principles;

•
announcements by us or our competitors of significant acquisitions or dispositions;

•
changes in earnings estimates by securities analysts or our ability to meet those estimates;

•
the operating and stock price performance of comparable companies; and

•
overall market fluctuations and general economic conditions.
         Investors may be unable to accurately value our common shares.
        Investors often value companies based on the stock prices and results of operations of comparable companies. Currently, no public company exists that is directly comparable to our size, scale and product offerings. For these reasons, investors may find it difficult to accurately value our common shares, which may cause our common shares to trade below our true value.
         Certain provisions of our bye-laws may reduce the likelihood of any unsolicited acquisition proposal or potential change of control that you might consider favorable.
        Our bye-laws contain provisions that could be considered "anti-takeover" provisions because they make it harder for a third-party to acquire us without the consent of our incumbent board of directors. Under these bye-law provisions:
•
shareholders may not remove directors without cause, change the size of the board of directors or, except in limited circumstances, fill vacancies on the board of directors;

•
shareholders may act only at shareholder meetings and not by written consent;

•
shareholders must comply with advance notice provisions for nominating directors or presenting other proposals at shareholder meetings;

•
restrictions will apply to any merger or other business combination (including an amalgamation under Bermuda law) between our company and any holder of 15% or more of our issued voting shares who became such without the prior approval of our board of directors; and

•
our board of directors may without shareholder approval issue preferred shares and determine their rights and terms, including voting rights, or adopt a shareholder rights plan.
        These provisions, which may only be amended by the affirmative vote of the holders of 80% of our issued voting shares, could have the effect of discouraging an unsolicited acquisition proposal or delaying, deferring, or preventing a change of control transaction that might involve a premium price or otherwise be considered favorably by our shareholders.

 ITEM 1B.    UNRESOLVED STAFF COMMENTS
        Not applicable.
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 ITEM 2.    PROPERTIES
Properties
        Our principal offices in the United States are located in Berwyn, Pennsylvania in a facility that we rent. We operate over 150 manufacturing, warehousing, and office locations in approximately 30 states in the United States. We also operate nearly 250 manufacturing, warehousing, and office locations in approximately 50 countries and territories outside the United States.
        We own approximately 20 million square feet of space and lease approximately 11 million square feet of space. Our facilities are reasonably maintained and suitable for the operations conducted in them.
Manufacturing
        We manufacture our products in more than 25 countries worldwide. These manufacturing sites focus on various aspects of the manufacturing processes, including our primary processes of stamping, plating, molding, extrusion, beaming, and assembly. We expect to continue to migrate our manufacturing activities to low-cost countries as our customers' requirements shift. In addition, we will continue to look for efficiencies to reduce our manufacturing costs and believe that we can achieve cost reductions through improved manufacturing efficiency and through the migration of manufacturing to low-cost countries.
        Our centers of manufacturing output at September 28, 2007 included sites in the following countries:

 	 	Number of Manufacturing Facilities
	
 	 	Electronic Components
	 	Network Solutions
	 	Wireless Systems
	 	Undersea Telecommunications
	 	Total
	
Americas:	 	 	 	 	 	 	 	 	 	 	
 	United States	 	28	 	4	 	7	 	1	 	40	
 	Mexico	 	5	 	1	 	—	 	—	 	6	
 	Brazil	 	2	 	—	 	—	 	—	 	2	
 	Canada	 	—	 	1	 	—	 	—	 	1	

Europe/Middle East/Africa:	

 	

 	

 	
 	
 	United Kingdom	 	3	 	5	 	1	 	—	 	9	
 	Germany	 	4	 	3	 	—	 	—	 	7	
 	India	 	5	 	1	 	—	 	—	 	6	
 	France	 	3	 	1	 	—	 	—	 	4	
 	Spain	 	3	 	1	 	—	 	—	 	4	
 	Switzerland	 	3	 	1	 	—	 	—	 	4	
 	Belgium	 	1	 	1	 	—	 	—	 	2	
 	Czech Republic	 	2	 	—	 	—	 	—	 	2	
 	Ireland	 	—	 	1	 	1	 	—	 	2	
 	Italy	 	2	 	—	 	—	 	—	 	2	
 	Austria	 	1	 	—	 	—	 	—	 	1	
 	Hungary	 	1	 	—	 	—	 	—	 	1	
 	Poland	 	1	 	—	 	—	 	—	 	1	
 	Portugal	 	1	 	—	 	—	 	—	 	1	

Asia-Pacific:	

 	

 	

 	
 	
 	China	 	13	 	2	 	—	 	—	 	15	
 	Japan	 	3	 	—	 	—	 	—	 	3	
 	Australia	 	2	 	—	 	—	 	—	 	2	
 	Indonesia	 	—	 	1	 	—	 	—	 	1	
 	Korea	 	1	 	—	 	—	 	—	 	1	
 	Malaysia	 	—	 	1	 	—	 	—	 	1	
 	New Zealand	 	1	 	—	 	—	 	—	 	1	
 	Singapore	 	1	 	—	 	—	 	—	 	1	
 	Thailand	 	—	 	1	 	—	 	—	 	1	
 	 		 		 		 		 		
Total	 	86	 	25	 	9	 	1	 	121	
 	 		 		 		 		 		
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        We estimate that our manufacturing production by region in fiscal 2007 was approximately: Americas—35%, Europe/Middle East/Africa—35%, and Asia-Pacific—30%.
        We expect that manufacturing production will continue to increase in the Asia-Pacific region as a percentage of total manufacturing as this region continues to experience strong growth and our customers' manufacturing continues to migrate to the region.

 ITEM 3.    LEGAL PROCEEDINGS
Tyco Electronics Legal Proceedings
        In the ordinary course of business, we are subject to various legal proceedings and claims, including antitrust claims, product liability matters, environmental matters, employment disputes, disputes on agreements, and other commercial disputes. In addition, we operate in an industry susceptible to significant patent legal claims. At any given time in the ordinary course of business, we are involved as either a plaintiff or defendant in a number of patent infringement actions. If infringement of a third party's patent were to be determined against us, we might be required to make significant royalty or other payments or might be subject to an injunction or other limitation on our ability to manufacture or sell one or more products. If a patent owned by or licensed to us were determined to be invalid or unenforceable, we might be required to reduce the value of the patent on our Consolidated and Combined Balance Sheet and to record a corresponding charge, which could be significant in amount.
        Management believes that these legal proceedings and claims likely will be resolved over an extended period of time. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information and applicable law, we do not expect that these proceedings will have a material adverse effect on our financial position. However, one or more of the proceedings could have a material adverse effect on our results of operations for a future period.
Tyco International Legal Proceedings
        Prior to the announcement by Tyco International of the planned separation of Tyco Electronics and Covidien in January 2006, Tyco International and certain former directors and officers were named as defendants in several lawsuits relating to securities class actions, shareholder lawsuits, and Employee Retirement Income Security Act of 1974 ("ERISA") related litigation. As a part of the Separation and Distribution Agreement, any existing or potential liabilities related to this outstanding litigation were allocated among Tyco International, Covidien, and us. We are responsible for 31% of potential liabilities that may arise upon the settlement of the pending litigation. If Tyco International or Covidien were to default on their obligation to pay their allocated share of these liabilities, however, we would be required to pay additional amounts. Subject to the terms and conditions of the Separation and Distribution Agreement, Tyco International will manage and control all the legal matters related to assumed contingent liabilities, including the defense or settlement thereof, subject to certain limitations. The liability sharing provisions regarding these class actions are set forth in the Separation and Distribution Agreement among Tyco International, Tyco Electronics, and Covidien, which is described below under "—Legal Matters under Separation and Distribution Agreement." A description of the class actions and other matters subject to this liability sharing agreement follows below.
Securities Class Actions
        Tyco International and certain of its former directors and officers have been named as defendants in over 40 purported securities class action lawsuits. Tyco International stipulated, pursuant to a court order, that each party to the Separation and Distribution Agreement will be primarily liable for a portion of the obligations arising from such litigation. The stipulation also provides that if any party defaults on its obligations, the other parties will be jointly and severally liable for those obligations. Most of the securities class actions have now been transferred to the United States District Court for
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the District of New Hampshire by the Judicial Panel on Multidistrict Litigation for coordinated or consolidated pretrial proceedings. On January 28, 2003, a consolidated securities class action complaint was filed in these proceedings. On January 7, 2005, Tyco International answered the plaintiffs' consolidated complaint. On January 14, 2005, lead plaintiffs made a motion for class certification, which Tyco International opposed on July 22, 2005. On July 5, 2005, Tyco International moved for revision of the court's October 14, 2004 order in light of a change in law, insofar as the order denied Tyco International's motion to dismiss the consolidated complaint for failure to plead loss causation. On December 2, 2005, the court denied Tyco International's motion. On April 4, 2006, plaintiffs filed a partial motion for summary judgment that was denied without prejudice to its later renewal. On June 12, 2006, the court entered an order certifying a class "consisting of all persons and entities who purchased or otherwise acquired Tyco International securities between December 13, 1999 and June 7, 2002, and who were damaged thereby, excluding defendants, all of the officers, directors and partners thereof, members of their immediate families and their legal representatives, heirs, successors or assigns, and any entity in which any of the foregoing have or had a controlling interest." On June 26, 2006, Tyco International filed a petition for leave to appeal the class certification order to the United States Court of Appeals for the First Circuit. On September 22, 2006, the United States Court of Appeals for the First Circuit denied Tyco International's petition. On July 6, 2006, the lead plaintiffs filed in the United States District Court for the District of New Hampshire a motion for a permanent injunction against prosecution of the class action styled Brazen v. Tyco International Ltd., et al. that was certified by the Circuit Court for Cook County, Illinois. On October 26, 2006, the court denied plaintiffs' motion for injunctive relief without prejudice.
Class Action Settlement
        On May 14, 2007, Tyco International entered into a memorandum of understanding with plaintiffs' counsel in connection with the settlement of 32 purported securities class action lawsuits. The actions previously had been consolidated and transferred by the Judicial Panel on Multidistrict Litigation to the United States District Court for the District of New Hampshire and include Brazen v. Tyco International Ltd., et al., Philip Cirella v. Tyco International Ltd., et al., Hromyak v. Tyco International Ltd., et al., Myers v. Tyco International Ltd., et al., Goldfarb v. Tyco International Ltd., et al., Rappold v. Tyco International Ltd., et al., Mandel v. Tyco International Ltd., et al., Schuldt v. Tyco International Ltd., et al., and 24 other consolidated securities cases.
        The memorandum of understanding does not resolve the following securities cases, which remain outstanding: New Jersey v. Tyco International Ltd., et al., Hess v. Tyco International Ltd., et al., Stumpf v. Tyco International Ltd., Ballard v. Tyco International Ltd., et al., Sciallo v. Tyco International Ltd., et al., Jasin v. Tyco International Ltd., et al., and Hall v. Kozlowski, et al . The proposed settlement does not release claims arising under ERISA which are not common to all class members, including any claims asserted in Overby, et al. v. Tyco International Ltd .
        Under the terms of the memorandum of understanding, the plaintiffs agreed to release all claims against Tyco International, the other settling defendants and ten other individuals in consideration for the payment of $2,975 million from Tyco International to the certified class and assignment to the class of any net recovery of any claims possessed by Tyco International and the other settling defendants against Tyco International's former auditor, PricewaterhouseCoopers. Defendant PricewaterhouseCoopers was not a settling defendant and is not a party to the memorandum. However, PricewaterhouseCoopers subsequently agreed to participate in the settlement as a settling defendant, and in consideration of a release of all claims against it by the parties to the memorandum of understanding, agreed to make a payment of $225 million. Tyco International and the other settling defendants have denied and continue to deny any wrongdoing and legal liability arising from any of the facts or conduct alleged in the actions.
        Pursuant to the terms of the memorandum of understanding, L. Dennis Kozlowski, Mark H. Swartz, and Frank E. Walsh, Jr. also are excluded from the settling defendants, and the class will assign to Tyco International all of their claims against defendants Kozlowski, Swartz, and Walsh. In exchange,
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Tyco International will agree to pay to the certified class 50% of any net recovery against these defendants.
        The parties to the memorandum of understanding applied to the court for approval of the settlement agreement. On July 13, 2007, the United States District Court for the District of New Hampshire granted preliminary approval of the settlement. On November 2, 2007, the final fairness hearing for the class settlement was held. The court indicated it would approve the settlement and stated a formal ruling would be issued shortly. If the settlement agreement does not receive final court approval, the memorandum of understanding will be null and void. By December 28, 2007, class participants must file their proofs of claim demonstrating their right to recovery under the class settlement.
        The deadline for deciding not to participate in the class settlement was September 28, 2007. As of such date, Tyco International had received opt-out notices from individuals and entities totaling approximately 4% of the shares owned by class members. These individuals and entities may pursue their claims separately against Tyco International and any judgments resulting from such claims would not reduce the settlement amount. One entity, Franklin Mutual Advisers, LLC, filed a complaint against Tyco International on September 24, 2007 in an action captioned Franklin Mutual Advisers, LLC v. Tyco International Ltd. in the United States District Court for the District of New Jersey alleging violations of Section 11 of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and Section 18 of the Exchange Act in connection with the plaintiffs' purchases and sales of Tyco International securities between June 4, 2001 and April 30, 2002. The plaintiffs seek unspecified compensatory damages and reasonable attorneys' fees and costs. Tyco International has requested that this action be transferred to the United States District Court for the District of New Hampshire. Tyco International has advised us that it intends to vigorously defend this litigation. It is not possible at this time to predict the final outcome or to estimate the amount of loss or range of possible loss, if any, that might result from an adverse resolution of the Franklin matter or other unasserted claims from individuals that have opted out.
        Under the terms of the Separation and Distribution Agreement entered into on June 29, 2007, each of Tyco International, Covidien, and Tyco Electronics are jointly and severally liable for the full amount of the class action settlement and any judgments resulting from opt-out claims. Additionally, under the Separation and Distribution Agreement, the companies share in the liability with Tyco International assuming 27%, Covidien 42%, and Tyco Electronics 31% of the settlement amount.
        In connection with the class action settlement, in the third quarter of fiscal 2007, we were allocated a charge from Tyco International of $922 million, for which no tax benefit was available. In addition, in fiscal 2007, we were allocated $35 million of income relating to Tyco International's expected recovery of certain costs from insurers, of which $31 million has been collected. The portions allocated to Tyco Electronics are consistent with the sharing percentage included in the Separation and Distribution Agreement which was entered into upon separation. Tyco International placed funds in escrow for the benefit of the class. The escrow account earns interest that is payable to the class. In addition, interest is accrued on the class action settlement liability. Under the Separation and Distribution Agreement, at fiscal year end 2007, we have recognized $928 million for our portion of the escrow, a $2,992 million liability, and a $2,064 million receivable from Tyco International and Covidien for their portion of the liability. Tyco International and Covidien also have funded their portion of the settlement liability.
        If the proposed settlement were not consummated on the agreed terms or if the unresolved proceedings were to be determined adversely to Tyco International, our share of any additional potential losses, which are not presently estimable, may have a material adverse effect on our financial position, results of operations, or cash flows.
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Securities Class Action Proceedings
        After filing an initial complaint on June 26, 2002 in an action entitled Brazen v. Tyco International Ltd., et al , the plaintiff filed an amended class action complaint on March 10, 2005 in the Circuit Court for Cook County, Illinois purporting to represent a class of purchasers who exchanged shares of Mallinckrodt, Inc. common stock for common shares of Tyco International pursuant to the joint proxy statement and prospectus, and the registration statement in which it was included, in connection with the October 17, 2000 merger of Tyco International and Mallinckrodt, Inc. Tyco International appealed to the United States Court of Appeals for the First Circuit the decision of the United States District Court for the District of New Hampshire to remand Brazen v. Tyco International Ltd., et al. to the Circuit Court for Cook County, Illinois, and Hromyak v. Tyco International Ltd., et al. , Goldfarb v. Tyco International Ltd., et al., Mandel v. Tyco International Ltd., et al., Myers v. Tyco International Ltd., et al., Rappold v. Tyco International Ltd., et al. , and Schuldt v. Tyco International Ltd., et al. to the Circuit Court for Palm Beach County, Florida. Plaintiffs moved to dismiss Tyco International's appeal. On December 29, 2004, the United States Court of Appeals for the First Circuit granted plaintiffs' motion and dismissed Tyco International's appeal. Tyco International moved in the Circuit Court for Palm Beach County, Florida to stay and to strike the class allegations in Goldfarb, Mandel, Myers, Rappold , and Schuldt . The Circuit Court granted Tyco International's motion to dismiss Hromyak , and the Florida District Court of Appeal affirmed the dismissal. These cases were included in the proposed settlement of the securities class action, which is contingent upon these cases being dismissed.
        On January 31, 2003, a civil action was filed by three plaintiffs in the United States District Court for the District of New Jersey, Cirella v. Tyco International Ltd., et al. Plaintiffs named as defendants Tyco International, Dennis Kozlowski, Mark Swartz, and Mark Belnick. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire. This case was included in the proposed settlement of the securities class action, which is contingent upon this case being dismissed.
        On November 27, 2002, the State of New Jersey, on behalf of several state pension funds, filed a complaint, New Jersey v. Tyco International Ltd., et al. , in the United States District Court for the District of New Jersey against Tyco International, Tyco International's former auditors and certain of Tyco International's former officers and directors. The complaint was amended on February 11, 2005. As against all defendants, the amended complaint asserts causes of action under Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, for common law fraud, aiding and abetting common law fraud, conspiracy to commit fraud, and negligent misrepresentation. Claims are asserted against the individual defendants under Section 20(a) of the Exchange Act, Section 15 of the Securities Act, Section 24(d) of the New Jersey Uniform Securities Law, Section 421-B:25(III) of the New Hampshire Uniform Securities Law, and for breaches of fiduciary duties. Claims also are asserted against certain of the individual defendants under Section 20A of the Exchange Act and for violation of the New Jersey RICO statute; against Tyco International under Section 12(a)(2) of the Securities Act, Section 24(c) of the New Jersey Uniform Securities Law, Section 421-B:25(II) of the New Hampshire Uniform Securities Law, and for violation of, aiding and abetting violation of, and vicarious liability under the New Jersey RICO statute; against Tyco International and certain of the individual defendants under Section 14(a) of the Securities Act and Rule 14a-9 promulgated thereunder, and for conspiracy to violate the New Jersey RICO statute; against Tyco International, its former auditors, and certain of the individual defendants under Section 11 of the Securities Act and for violation of, and conspiracy to violate the New Jersey RICO statute; and against Tyco International's former auditors and certain of the individual defendants for aiding and abetting violation of the New Jersey RICO statute. Finally, claims are asserted against the individual defendants and Tyco International's former auditors for aiding and abetting the individual defendants' breaches of fiduciary duties. Plaintiffs assert that the defendants violated the securities laws and otherwise engaged in fraudulent acts by making materially false and misleading statements and omissions concerning, among other things, the following: unauthorized and
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improper compensation of certain of Tyco International's former executives; their improper use of Tyco International's funds for personal benefit and their improper self-dealing in real estate. The plaintiffs seek unspecified monetary damages and other relief. On June 10, 2005, Tyco International moved to dismiss in part the amended complaint. On June 11, 2007, the court granted in part and denied in part Tyco International's motion to dismiss the amended complaint. Many of the above plaintiffs' claims remain pending. On July 24, 2007, the plaintiffs moved for leave to amend their complaint again. Tyco International responded in opposition to the motion on August 10, 2007, and the court has not yet ruled on the plaintiffs' motion.
        An action entitled Hess v. Tyco International Ltd., et al. , was filed on June 3, 2004 in the Superior Court of the State of California for the County of Los Angeles against certain of Tyco International's former directors and officers, Tyco International's former auditors and Tyco International. On October 25, 2006, the court lifted its previous order staying the case during the pendency of a related arbitration to which Tyco International was not a party. On December 26, 2006, Tyco International filed a demurrer seeking dismissal of the action on the ground that the complaint failed to allege facts sufficient to state causes of action. Before argument could be heard on the demurrer, the plaintiffs notified the court that they would file an amended complaint. The amended complaint was filed on July 9, 2007. The amended complaint asserts claims of fraud, negligent representation, aiding and abetting breach of fiduciary duty, and breach of fiduciary duty in connection with, and subsequent to, an underlying settlement of litigation brought by shareholders in Progressive Angioplasty Systems, Inc. where the plaintiffs received Tyco International's stock as consideration. The amended complaint alleges collective losses of not less than $20 million and seeks compensatory and punitive damages. On September 13, 2007, Tyco International filed its answer to the amended complaint. The parties also have begun to engage in discovery, serving document requests and interrogatories.
        On October 30, 2003, Stumpf v. Tyco International Ltd. was transferred to the United States District Court for the District of New Hampshire by the Judicial Panel on Multidistrict Litigation. The complaint asserts claims against Tyco International based on Section 11 of the Securities Act, Section 15 of the Securities Act, Section 10(b) of the Exchange Act, and Section 20(a) of the Exchange Act. In orders dated September 2, 2005 and January 6, 2005, the court denied Tyco International's motion to dismiss. On June 12, 2007, the court certified a purported class consisting of all persons or entities who purchased TyCom stock, either pursuant to a July 26, 2000 registration statement and prospectus for TyCom's initial public offering, or on the open market between July 26, 2000 and December 17, 2001. On June 26, 2007, Tyco International filed a Rule 23(f) petition seeking leave to appeal the class certification order. On September 13, 2007, the United States Court of Appeals for the First Circuit denied Tyco International's petition.
        On April 29, 2005, an action was filed against Tyco International in the United States District Court for the Southern District of Florida, Stevenson v. Tyco International Ltd. , et al. Plaintiff named as additional defendants Tyco International's current Chief Executive Officer, Edward Breen, former Chief Financial Officer, David FitzPatrick, former Executive Vice President and General Counsel, William Lytton, current members of Tyco International's board of directors including Dennis Blair, Bruce Gordon, John Krol, Carl McCall, Brendan O'Neill, Sandra Wijnberg, and Jerome York, as well as former members of Tyco International's board of directors, including Michael Ashcroft, Joshua Berman, Richard Bodman, John Fort, Steven Foss, Wendy Lane, Mackey McDonald, James Pasman, Peter Slusser, and Joseph Welch. The complaint asserts causes of action under Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. The complaint alleges that the defendants made material misrepresentations that resulted in artificially deflated stock prices. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire. On March 31, 2007, Tyco International filed a motion to dismiss the complaint and the court granted the motion to dismiss on June 13, 2007.
        On January 20, 2004, a complaint was filed in the United States District Court for the Southern District of New York, Ballard v. Tyco International Ltd., et al . Plaintiffs are trustees of various trusts that
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were allegedly major shareholders of AMP, Inc., a company acquired by Tyco International in April 1999. Plaintiffs named as defendants Tyco International, five of its former officers and directors, and PricewaterhourseCoopers LLP. As against all defendants, the complaint asserts causes of action under Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and Section 11 of the Securities Act. As against the Tyco International defendants, the complaint asserts causes of action under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder, Section 12(a)(2) of the Securities Act, and for common law fraud and negligent misrepresentation. As against the individual defendants, the complaint asserts causes of action under Section 20(a) of the Exchange Act and Section 15 of the Securities Act. The complaint alleges that defendants engaged in a scheme to artificially inflate Tyco International's earnings and to mislead investors as to Tyco International's positive earnings, growth and acquisition synergies prior to and in connection with its acquisition of AMP, Inc. The Judicial Panel on Multidistrict Litigation transferred the action to the United States District Court for the District of New Hampshire. Tyco International moved to dismiss the complaint, and that motion was denied. On August 5, 2005, defendant Michael A. Ashcroft's motion to dismiss with respect to the plaintiffs' claims under Sections 10(b) and 20(a) of the Exchange Act, Section 15 of the Securities Act, and common law fraud and negligent misrepresentation claims was granted.
        A complaint, Sciallo v. Tyco International Ltd., et al ., was filed on September 30, 2003 in the United States District Court for the Southern District of New York. The plaintiffs purport to be former executives of U.S. Surgical who traded their U.S. Surgical stock options for Tyco International stock options when Tyco International acquired U.S. Surgical on October 1, 1998. Plaintiffs named as defendants Tyco International and certain former Tyco International directors and executives. The complaint asserts causes of action under Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, for common law fraud and negligence, and violation of New York General Business Law Section 349, which prohibits deceptive acts and practices in the conduct of any business. The complaint alleges that defendants made materially false and misleading statements and omissions concerning, among other things, Tyco International's financial condition and accounting practices. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire.
        A complaint was filed on September 2, 2004 in the Court of Common Pleas for Dauphin County, Pennsylvania, Jasin v. Tyco International Ltd., et al. This pro se plaintiff named as additional defendants Tyco International (US) Inc., Dennis Kozlowski, Tyco International's former Chairman and Chief Executive Officer, Mark Swartz, Tyco International's former Chief Financial Officer and Director, and Juergen Gromer, currently President of Tyco Electronics. Plaintiff's complaint asserts causes of action under Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, as well as Section 11 of the Securities Act. Claims against Messrs. Kozlowski, Swartz, and Gromer also are asserted under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder and Section 20A of the Exchange Act, as well as Sections 11, 12(a)(2) and 15 of the Securities Act. Plaintiff also asserts common law fraud, negligent misrepresentation, unfair trade practice, breach of contract, breach of the duty of good faith and fair dealing, and violation of Section 1-402 of the Pennsylvania Securities Act of 1972. Tyco International has removed the complaint to the United States District Court for the Middle District of Pennsylvania. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire.
        The Judicial Panel on Multidistrict Litigation was notified that Hall v. Kozlowski, et al. , an action relating to plaintiff's employment, 401(k) and pension plans and ownership of Tyco International stock, may be an action that should be transferred to the United States District Court for the District of New Hampshire. Thereafter, the Judicial Panel on Multidistrict Litigation transferred the action to the United States District Court for the District of New Hampshire. On March 16, 2005, Tyco International answered plaintiff's amended complaint.
        Plaintiff moved to remand Davis v. Kozlowski, et al. , an action originally filed on December 9, 2003, from the United States District Court for the District of New Hampshire back to the Circuit Court of
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Cook County, Illinois. On March 17, 2005, the United States District Court for the District of New Hampshire granted plaintiff's motion to remand and denied defendants' motion to dismiss. On March 31, 2005, Tyco International moved for reconsideration of the court's remand order. On July 17, 2006, the court entered an order granting Tyco International's motion to dismiss on the grounds that all of plaintiff's claims were preempted by federal law. The motion to dismiss was granted without prejudice to plaintiff's right to file another action in state court asserting claims that are not preempted by federal law. On January 8, 2007, plaintiff filed an action in the Circuit Court of Cook County, Illinois. The complaint seeks unspecified monetary damages and other relief. On January 12, 2007, Tyco International removed the re-filed action to federal court in the United States District Court for the Northern District of Illinois, Eastern Division. On February 1, 2007, the Judicial Panel on Multidistrict Litigation issued a conditional transfer order transferring the case to the United States District Court for the District of New Hampshire. Plaintiffs filed a motion to remand the case to state court on February 12, 2007 and moved the Judicial Panel on Multidistrict Litigation to vacate the conditional transfer order on March 9, 2007. Tyco International filed an opposition to the motion to vacate on March 29, 2007. On March 15, 2007, Tyco International filed an opposition to plaintiffs' remand motion and filed a cross-motion to dismiss the action. Briefing on the cross-motion was completed on April 26, 2007. On May 31, 2007, the Judicial Panel on Multidistrict Litigation denied the motion to vacate the conditional transfer order. On June 15, 2007, the Judicial Panel on Multidistrict Litigation transferred the case back to the United States District Court for the District of New Hampshire. On October 16, 2007, Tyco International filed its renewed cross-motion to dismiss the action.
Shareholder Derivative Litigation
        An action was filed on June 7, 2002 in the Supreme Court of the State of New York, Levin v. Kozlowski, et al. , alleging that the individually named defendants breached their fiduciary duties, committed waste and mismanagement, and engaged in self-dealing in connection with certain Tyco International accounting practices, individual board members' use of Tyco International funds, and the financial disclosures of certain mergers and acquisitions. Plaintiffs further alleged that certain of the individual defendants converted corporate assets for their own use. Plaintiffs seek money damages. Plaintiffs agreed to stay that action pending the resolution of the federal derivative action, which was dismissed by the United States District Court for the District of New Hampshire on October 14, 2004; and the appeal from that ruling was voluntarily dismissed on May 19, 2005. On June 14, 2005, plaintiffs resumed the Levin action. On September 22, 2005, Tyco International filed a motion to dismiss the derivative complaint. On November 14, 2006, the Supreme Court of the State of New York dismissed the complaint with prejudice. On December 11, 2006, plaintiffs filed a notice of appeal of the court's November 14, 2006 order dismissing the complaint. On October 25, 2007, the Supreme Court of the State of New York, Appellate Division, First Department, heard oral arguments in this action, and on November 15, 2007, the court denied the plaintiff's appeal.
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ERISA Litigation
        Tyco International and certain of its current and former employees, officers, and directors have been named as defendants in eight class actions brought under ERISA. Two of the actions were filed in the United States District Court for the District of New Hampshire and the six remaining actions were transferred to that court by the Judicial Panel on Multidistrict Litigation. All eight actions have been consolidated in the District Court in New Hampshire. The consolidated complaint purports to bring claims on behalf of the Tyco International Retirement Savings and Investment Plans and the participants therein and alleges that the defendants breached their fiduciary duties under ERISA by negligently misrepresenting and negligently failing to disclose material information concerning, among other things, the following: related-party transactions and executive compensation; Tyco International's mergers and acquisitions and the accounting therefor, as well as allegedly undisclosed acquisitions; and misstatements of Tyco International's financial results. The complaint also asserts that the defendants breached their fiduciary duties by allowing the Plans to invest in Tyco International's shares when it was not a prudent investment. The complaints seek recovery of alleged plan losses arising from alleged breaches of fiduciary duties. On January 12, 2005, the United States District Court for the District of New Hampshire denied, without prejudice, Tyco International's motion to dismiss certain additional individual defendants from the action. On January 20, 2005, plaintiffs filed a motion for class certification. On January 27, 2005, Tyco International answered the plaintiffs' consolidated complaint. Also, on January 28, 2005, Tyco International and certain individual defendants filed a motion for reconsideration of the court's January 12, 2005 order, insofar as it related to the Tyco International Retirement Committee. On May 25, 2005, the court denied the motion for reconsideration. On July 11, 2005, Tyco International and certain individual defendants opposed plaintiffs' motion for class certification. On August 15, 2006, the court entered an order certifying a class "consisting of all Participants in the Plans for whose individual accounts the Plans purchased and/or held shares of Tyco Stock Fund at any time from August 12, 1998 to July 25, 2002." On August 29, 2006, Tyco International filed a petition for leave to appeal the class certification order to the United States Court of Appeals for the First Circuit. On November 13, 2006, the United States Court of Appeals for the First Circuit denied Tyco International's petition. On November 28, 2006, plaintiffs filed a motion seeking an order directing them to serve notice of the ERISA class action on potential class members. Tyco International did not object to service of notice on potential class members, and on January 11, 2007, plaintiffs filed a motion, assented to by Tyco International that proposed an agreed upon form of notice. On January 18, 2007, the court granted that motion. On December 5, 2006, plaintiffs filed a motion seeking leave to file an amended complaint. Subsequently, on January 10, 2007, plaintiffs filed a motion to withdraw their motion to amend the complaint without prejudice.
Tyco International Litigation Against Former Senior Management
         Tyco International, Ltd. v. L. Dennis Kozlowski, United States District Court, Southern District of New York, No. 02-CV-7317, filed September 12, 2002, amended April 1, 2003 .    Tyco International filed a civil complaint against Tyco International's former Chairman and Chief Executive Officer, Dennis Kozlowski, for breach of fiduciary duty and other wrongful conduct. Tyco International amended that complaint on April 1, 2003. The amended complaint alleges that the defendant misappropriated millions of dollars from Tyco International's Key Employee Loan Program and relocation program; awarded millions of dollars in unauthorized bonuses to himself and certain other Tyco International employees; engaged in improper self-dealing real estate transactions involving Tyco International's assets; and conspired with certain other former Tyco International employees in committing these acts. The amended complaint alleges causes of action for breach of fiduciary duty, fraud, unjust enrichment, breach of contract, conversion, constructive trust, and other wrongful conduct. The amended complaint seeks recovery for all of the losses suffered by Tyco International as a result of the former Chairman and Chief Executive Officer's conduct, and of all remuneration, including restricted and unrestricted
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shares and options, obtained by Mr. Kozlowski during the course of this conduct. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire. On October 6, 2003, Mr. Kozlowski filed a motion to dismiss or stay the case and compel arbitration, which was denied on March 16, 2004, with one exception relating to the arbitration of a claim asserting the fraudulent inducement of Mr. Kozlowski's retention agreement. On April 9, 2004, Mr. Kozlowski filed an answer, affirmative defenses and counterclaims, seeking amounts allegedly due pursuant to his purported retention agreement, life insurance policies, and other arrangements. Tyco International filed its reply to the counterclaims on April 29, 2004. Discovery in this and the other affirmative cases is proceeding.
        Mr. Kozlowski was tried on criminal charges in New York County. The first criminal trial resulted in a mistrial declared on April 2, 2004. The retrial of Mr. Kozlowski began on January 18, 2005 and concluded on June 17, 2005, when the jury returned verdicts. Of the thirty-one counts submitted to it, which were similar to certain of the claims alleged in Tyco International's affirmative action described above, twenty-two were against Mr. Kozlowski. The jury found Mr. Kozlowski guilty on all charges of grand larceny, conspiracy and securities fraud, and all but one count of falsification of business records. On September 19, 2005, Mr. Kozlowski was sentenced to a term of imprisonment of eight and one-third years to twenty-five years, and ordered to pay an individual fine of $70 million and restitution, jointly and severally with Mr. Swartz, to Tyco International of $134 million within one year. On September 19, 2005, Mr. Kozlowski filed a notice of appeal from his conviction and on October 3, 2006 filed a brief in support of his appeal. On January 2, 2007, by order of the Supreme Court of the State of New York, the New York County District Attorney's office released to Tyco International, on behalf of Mr. Kozlowski, $98 million in restitution. The payment by Mr. Kozlowski was made pending the outcome of his appeal, which was denied on November 15, 2007.
         Tyco International, Ltd. v. Mark H. Swartz, United States District Court, Southern District of New York, No. 03-CV-2247 (TPG), filed April 1, 2003 .    Tyco International filed an arbitration claim against Mark Swartz, its former Chief Financial Officer and director, on October 7, 2002. As a consequence of Mr. Swartz's refusal to submit to the jurisdiction of the American Arbitration Association, Tyco International filed a civil complaint against him on April 1, 2003, for breach of fiduciary duty and other wrongful conduct. The action alleges that the defendant misappropriated millions of dollars from Tyco International's Key Employee Loan Program and relocation program; approved and implemented awards of millions of dollars of unauthorized bonuses to himself and certain other Tyco International employees; awarded millions of dollars in unauthorized payments to himself; engaged in improper self-dealing real estate transactions involving Tyco International's assets; and conspired with certain other former Tyco International employees in committing these acts. The complaint alleges causes of action for breach of fiduciary duty, fraud, unjust enrichment, conversion and constructive trust, and other wrongful conduct. The action seeks recovery for all of the losses suffered by Tyco International as a result of the former Chief Financial Officer and director's conduct, and all remuneration, including restricted and unrestricted shares and options, obtained by Mr. Swartz during the course of this conduct. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire. Mr. Swartz moved to dismiss Tyco International's complaint and to compel arbitration of the parties' respective claims. The court denied Mr. Swartz's motion and he has appealed the court's decision to the United States Court of Appeals for the First Circuit. His appeal was heard on December 8, 2004. The First Circuit affirmed the District Court's decision on September 7, 2005. Discovery in this and the other affirmative cases is proceeding.
        Mr. Swartz was tried on criminal charges in New York County. The first criminal trial resulted in a mistrial declared on April 2, 2004. The retrial of Mr. Swartz began on January 18, 2005 and concluded on June 17, 2005, when the jury returned verdicts. Of the thirty-one counts submitted to it, which were similar to certain of the claims alleged in Tyco International's affirmative action described above, twenty-three were against Mr. Swartz. The jury found Mr. Swartz guilty on all charges of grand larceny,
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conspiracy and securities fraud, and all but one count of falsification of business records. On September 19, 2005, Mr. Swartz was sentenced to a term of imprisonment of eight and one-third years to twenty-five years, and ordered to pay an individual fine of $35 million and restitution, jointly and severally with Mr. Kozlowski, to Tyco International of $134 million within one year and Mr. Swartz was ordered individually to pay restitution to Tyco International of an additional $1 million. On September 19, 2005, Mr. Swartz filed a notice of appeal from his conviction and on October 3, 2006 filed a brief in support of his appeal. On October 27, 2006, Mr. Swartz paid restitution to Tyco International in the amount of $38 million. The payment by Mr. Swartz was made pending the outcome of his appeal, which was denied on November 15, 2007.
         Tyco International, Ltd. v. L. Dennis Kozlowski and Mark H. Swartz, United States District Court Southern District of New York, No. 02-CV-9705, filed December 6, 2002 .    Tyco International filed a civil complaint against its former Chairman and Chief Executive Officer and former Chief Financial Officer and director pursuant to Section 16(b) of the Exchange Act for disgorgement of short-swing profits from prohibited transactions in Tyco International's common shares believed to exceed $40 million. The action seeks disgorgement of profits, interest, attorneys' fees, and costs. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire. On October 6, 2003, Messrs. Kozlowski and Swartz moved to dismiss the claims against them based upon the statute of limitations. On March 16, 2004, the court granted the defendants' motion to dismiss in part with leave for Tyco International to file an amended complaint. Tyco International filed an amended complaint on May 14, 2004. The defendants moved to dismiss certain claims in the amended complaint on June 28, 2004. The defendants' motion to dismiss was denied on April 21, 2005. The defendants' motion to extend time to answer the complaint until thirty days after the conclusion of deliberations in the criminal trial was granted on May 17, 2005. Both defendants filed their answers on July 18, 2005. Discovery in this and the other affirmative cases is proceeding.
         Tyco International Ltd. v. Frank E. Walsh, Jr., United States District Court, Southern District of New York, No. 02-CV-4633, filed June 17, 2002 .    Tyco International filed a civil complaint against Frank E. Walsh, Jr., a former director, for breach of fiduciary duty and related wrongful conduct involving receipt by Walsh of a $20 million payment in connection with Tyco International's 2001 acquisition of the CIT Group, Inc. The action alleges causes of action for restitution, breach of fiduciary duty and inducing breach of fiduciary duty, conversion, unjust enrichment, and constructive trust, and seeks recovery for all of the losses suffered by Tyco International as a result of the defendant director's conduct. On December 17, 2002, Mr. Walsh paid $20 million in restitution to Tyco International, which was deposited by Tyco International in January 2003, as a result of a plea bargain agreement with the New York County District Attorney. Tyco International's claims against Mr. Walsh are still pending. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire. Discovery in this and the other affirmative cases is proceeding.
Subpoenas and Document Requests From Governmental Entities
        Tyco International and others have received various subpoenas and requests from the SEC, the U.S. Department of Labor, the General Service Administration and others seeking the production of voluminous documents in connection with various investigations into Tyco International's governance, management, operations, accounting, and related controls. We and Tyco International are cooperating with these investigations and are complying with these requests.
        The Department of Labor served document subpoenas on Tyco International and Fidelity Management Trust Company for documents concerning the administration of the Tyco International Retirement Savings and Investment Plans. The current focus of the Department of Labor's inquiry concerns the losses allegedly experienced by the plans due to investments in Tyco International's stock.
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The Department of Labor has authority to bring suit on behalf of the plans and their participants against those acting as fiduciaries to the plans for recovery of losses and additional penalties, although it has not informed Tyco International of any intention to do so. Tyco International is continuing to cooperate with the Department of Labor's investigation.
        Tyco International has advised us that it cannot predict when these investigations will be completed, nor can it predict what the results of these investigations may be. It is possible that Tyco International will be required to pay material fines or suffer other penalties. It is not possible to estimate the amount of loss, or range of possible loss, if any, that might result from an adverse resolution of these matters. As a result, our share of such potential losses also is not estimable and may have a material adverse effect on our financial position, results of operations, or cash flows.
Compliance Matters
        Tyco International has received and responded to various allegations that certain improper payments were made by Tyco International subsidiaries, including Tyco Electronics subsidiaries, in recent years. During 2005 and 2006, Tyco International reported to the U.S. Department of Justice ("DOJ") and the SEC the investigative steps and remedial measures that it had taken in response to the allegations. Tyco International also informed the DOJ and the SEC that it retained outside counsel to perform a company-wide baseline review of its policies, controls and practices with respect to compliance with the Foreign Corrupt Practices Act, that it would continue to make periodic progress reports to these agencies, and that it would present its factual findings upon conclusion of the baseline review. Tyco International and Tyco Electronics have had communications with the DOJ and SEC to provide updates on the baseline review being conducted by outside counsel, including, as appropriate, briefings concerning additional instances of potential improper payments identified by Tyco International and us in the course of our ongoing compliance activities. To date, the baseline review has revealed that some business practices may not comply with Tyco International and FCPA requirements. At this time, we cannot predict the outcome of these matters and other allegations reported to regulatory and law enforcement authorities and, therefore, cannot estimate the range of potential loss or extent of risk, if any, that may result from an adverse resolution of any or all of these matters. However, it is possible that we may be required to pay judgments, suffer penalties, or incur settlements in amounts that may have a material adverse effect on our financial position, results of operations, or cash flows. Any judgment, settlement, or other cost incurred by Tyco International in connection with these matters would be subject to the liability sharing provisions of the Separation and Distribution Agreement, which provides that any liabilities not primarily related to any of the businesses of Tyco International, Covidien, or Tyco Electronics will be shared equally among the companies.
Legal Matters under Separation and Distribution Agreement
        As a party to the Separation and Distribution Agreement among us, Tyco International, and Covidien which governs the relationships among us, Tyco International, and Covidien and provides for the allocation among us, Tyco International, and Covidien of Tyco International's assets, liabilities, and obligations attributable to periods prior to the respective separations from Tyco International, we have assumed the liability for, and control of, all pending and threatened legal matters related to our own business or assumed or retained liabilities, and will indemnify the other parties for any liability arising out of or resulting from such assumed legal matters.
        Each party to a claim will agree to cooperate in defending any claims against two or more parties for events that took place prior to, on or after June 29, 2007, the date of the separation. Tyco International initially will act as managing party and manage and assume control of all legal matters related to any assumed Tyco International contingent liability or Tyco International contingent asset,
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including settlement of such legal matters. In the event of the bankruptcy or insolvency of Tyco International, Covidien will become the managing party. In addition, in the event of a change in control of the managing party, a change in the chief executive officer of the managing party, or a change in the majority of the board of directors of the managing party, the managing party may be changed by the vote of two of the three parties to the Separation and Distribution Agreement. Moreover, on an annual basis the parties to the Separation and Distribution Agreement will determine whether or not to change the managing party and the vote of two of the three parties will be sufficient to effect such change. Each of us, Covidien, and Tyco International will cooperate fully with the applicable managing party in connection with the management of such assets and liabilities. All costs and expenses related thereto shall be shared equally by these three parties. If any party defaults in payment of its portion of any assumed Tyco International contingent liability or the cost of managing any Tyco International contingent asset, each non-defaulting party will be responsible for an equal portion of the amount in default together with any other non-defaulting party, although any such payments will not release the obligation of the defaulting party.

 ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
        No matters were submitted to security holders for a vote during the fourth quarter of the fiscal year ended September 28, 2007.
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 PART II
ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
        Tyco Electronics' common shares are listed and traded on the NYSE and the Bermuda Stock Exchange under the symbol "TEL," and began trading on the NYSE on a "when-issued" basis on June 14, 2007 prior to Tyco Electronics' spin-off from Tyco International on June 29, 2007. The following table sets forth the high and low closing sales prices of Tyco Electronics' common shares as reported by the NYSE for the quarterly periods from and after June 14, 2007.

 	 	Market Price Range
	
Fiscal Year Ended September 28, 2007
			
	 	High
	 	Low
	
Third Quarter (June 14, 2007 through June 29, 2007)	 	$	39.75	 	$	35.95	
Fourth Quarter (June 30, 2007 through Sept. 28, 2007)	 	 	40.30	 	 	32.45	
        The number of registered holders of Tyco Electronics' common shares at December 11, 2007 was 39,881.
Dividend Policy
        On September 26, 2007, the board of directors of Tyco Electronics declared a quarterly cash dividend of $0.14 per common share, payable on November 1, 2007, to shareholders of record as of October 2, 2007. Future dividends on our common shares, if any, will be at the discretion of Tyco Electronics' board of directors and will depend on, among other things, our results of operations, cash requirements and surplus, financial condition, statutory requirements of Bermuda law, contractual restrictions, and other factors that the board of directors may deem relevant. We may from time to time enter into financing agreements that contain financial covenants and restrictions, some of which may limit the ability of Tyco Electronics to pay dividends.
Recent Sales of Unregistered Securities
        Under the Separation and Distribution Agreement among Tyco International, Covidien, and Tyco Electronics, we may be required from time to time to issue common shares upon the conversion of convertible notes of Tyco International that were outstanding at the time of the separation. During the fiscal quarter ended September 28, 2007, we issued 32,786 unregistered common shares upon the conversion of Tyco International convertible notes.
38

Equity Compensation Plan Information
        The following table provides information as of September 28, 2007 with respect to Tyco Electronics' common shares issuable under its equity compensation plans or equity compensation plans of Tyco International prior to the separation:

Plan Category
	 	Number of securities
to be issued upon
exercise of outstanding
options, warrants
and rights
(a)
	 	Weighted-average
exercise price of
outstanding options,
warrants and rights
(b)
	 	Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected
in column (a))
(c)
	
Equity compensation plans approved by security holders:	 	 	 	 	 	 	 	
 	2007 Stock and Incentive Plan (1)	 	4,984,910	 	$	39.82	 	19,858,542	

Equity compensation plans not approved by security holders:	

 	

 	
 	
 	Equity awards under Tyco International Ltd. 2004 Stock and Incentive Plan and other equity incentive plans (2)	 	31,615,015	 	$	42.55	 	—	
 	 		 	 	 	 		
 	Total	 	36,599,925	 	 	 	 	19,858,542	

(1)
The Tyco Electronics Ltd. 2007 Stock and Incentive Plan (the "2007 Plan") provides for the award of stock options, stock appreciation rights, annual performance bonuses, long-term performance awards, restricted units, deferred stock units, restricted stock, promissory stock, and other stock-based awards (collectively, "Awards") to board members, officers, and non-officer employees. The 2007 Plan provides for a maximum of 24,843,452 common shares to be issued as Awards, subject to adjustment as provided under the terms of the 2007 Plan.

(2)
Includes common shares that may be issued by Tyco Electronics pursuant to the Separation and Distribution Agreement under equity awards, including stock options, restricted stock, restricted stock units, performance share units, and deferred stock units, granted to current and former employees and directors of Tyco International Ltd. and its subsidiaries, which may include individuals currently or formerly employed by or serving with Tyco Electronics, Tyco International, or Covidien subsequent to the separation. See Note 23 to the Consolidated and Combined Financial Statements for additional information regarding these outstanding awards.

 ITEM 6.    SELECTED FINANCIAL DATA
        The following table presents selected consolidated and combined financial and other operating data for Tyco Electronics. The consolidated and combined statement of operations data for fiscal 2007, 2006, and 2005 and the consolidated and combined balance sheet data as of September 28, 2007 and September 29, 2006 are derived from our audited consolidated and combined financial statements included elsewhere in this Annual Report. The combined statement of operations data for fiscal 2004 and the combined balance sheet data as of September 30, 2005 are derived from our audited combined financial statements not included elsewhere in this Annual Report. The combined statement of operations data for fiscal 2003 and the combined balance sheet data as of September 30, 2004 and 2003 are derived from our unaudited combined financial statements not included elsewhere in this Annual Report. The unaudited combined financial statements have been prepared on the same basis of the audited consolidated and combined financial statements and, in the opinion of management, include all
39

adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the information set forth herein.
        The data presented below should be read in conjunction with our Consolidated and Combined Financial Statements and accompanying notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this Annual Report. Our consolidated and combined financial information may not be indicative of our future performance and does not necessarily reflect what our financial position and results of operations would have been had we operated as an independent, publicly-traded company during the periods presented.

 	 	As of or for Fiscal
	 	
 	 	2007 (1)
	 	2006 (2)(6)
	 	2005 (3)(6)
	 	2004 (4)(6)
	 	2003 (5)(6)
	 	
 	 	(in millions, except per share data)
	 	
Statement of Operations Data	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net sales	 	$	13,460	 	$	12,300	 	$	11,433	 	$	10,608	 	$	9,217	 	
Gross income	 	 	3,448	 	 	3,301	 	 	3,099	 	 	3,024	 	 	2,510	 	
Allocated class action settlement costs, net	 	 	887	 	 	—	 	 	—	 	 	—	 	 	—	 	
Separation costs	 	 	45	 	 	—	 	 	—	 	 	—	 	 	—	 	
Restructuring and other charges (credits), net	 	 	99	 	 	13	 	 	(10	)	 	(34	)	 	599	 	
Goodwill impairment	 	 	—	 	 	316	 	 	—	 	 	—	 	 	30	 	
Gain on divestiture	 	 	—	 	 	—	 	 	(301	)	 	—	 	 	—	 	
Income from operations	 	 	753	 	 	1,448	 	 	2,007	 	 	1,619	 	 	547	 	
(Loss) income from continuing operations	 	 	(144	)	 	1,188	 	 	1,011	 	 	758	 	 	17	 	
(Loss) income from discontinued operations, net of income taxes	 	 	(410	)	 	13	 	 	122	 	 	4	 	 	(218	)	
Cumulative effect of accounting change, net of income taxes	 	 	—	 	 	(8	)	 	11	 	 	—	 	 	(27	)	
Net (loss) income	 	$	(554	)	$	1,193	 	$	1,144	 	$	762	 	$	(228	)	
Per Share Data	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic and diluted (loss) earnings per share: (7)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	(Loss) income from continuing operations	 	$	(0.29	)	$	2.39	 	$	2.03	 	$	1.53	 	$	0.03	 	
 	Net (loss) income	 	 	(1.11	)	 	2.40	 	 	2.30	 	 	1.53	 	 	(0.46	)	
Cash dividends per share	 	$	0.14	 	$	—	 	$	—	 	$	—	 	$	—	 	
Balance Sheet Data	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current assets	 	$	9,873	 	$	6,550	 	$	5,884	 	$	5,767	 	$	5,338	 	
Total assets	 	 	23,688	 	 	19,091	 	 	18,473	 	 	18,789	 	 	18,132	 	
Total current liabilities	 	 	6,185	 	 	3,149	 	 	3,165	 	 	2,962	 	 	3,081	 	
Long-term debt and obligations under capital lease	 	 	3,373	 	 	3,371	 	 	3,816	 	 	5,226	 	 	6,502	 	
Total equity	 	 	11,377	 	 	11,160	 	 	9,842	 	 	8,242	 	 	6,294	 	
Working capital (8)	 	 	3,688	 	 	3,401	 	 	2,719	 	 	2,805	 	 	2,257	 	
Other Operating Data	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	$	892	 	$	555	 	$	476	 	$	405	 	$	439	 	

(1)
Fiscal 2007 loss from continuing operations includes allocated class action settlement costs, net of $887 million, separation costs of $45 million, restructuring and other charges, net of $99 million, and allocated loss on retirement of debt of $232 million. (See Notes 16, 3, 4, and 12 to the Consolidated and Combined Financial Statements.) Fiscal 2007 net loss includes $410 million of loss, net of income taxes, from discontinued operations. (See Note 5 to the Consolidated and Combined Financial Statements.)

(2)
Fiscal 2006 income from continuing operations includes a goodwill impairment charge of $316 million in the Wireless Systems segment related to the Integrated Wireless Products reporting unit. (See Note 9 to the Consolidated and Combined Financial Statements.) Fiscal 2006 net income includes $13 million of income, net of income taxes, from discontinued operations as well as an $8 million loss, net of income taxes, related to the cumulative effect of accounting change recorded
40

in conjunction with the adoption of Financial Accounting Standards Board Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations—an Interpretation of FASB Statement No. 143." (See Notes 5 and 2 to the Consolidated and Combined Financial Statements.)
(3)
Fiscal 2005 income from continuing operations includes a $301 million gain on the divestiture of the Tyco Global Network. (See Note 5 to the Consolidated and Combined Financial Statements.) Also included in fiscal 2005 income from continuing operations is $365 million of loss on retirement of debt. (See Note 12 to the Consolidated and Combined Financial Statements.) Fiscal 2005 net income includes $122 million of income, net of income taxes, from discontinued operations as well as an $11 million gain, net of income taxes, related to the cumulative effect of accounting change recorded in conjunction with the change in measurement date for pension and postretirement benefit plans. (See Notes 5 and 2 to the Consolidated and Combined Financial Statements.)

(4)
Fiscal 2004 income from continuing operations includes $102 million of loss on retirement of debt. Fiscal 2004 net income includes $4 million of income, net of income taxes, from discontinued operations.

(5)
Fiscal 2003 income from continuing operations includes restructuring and other charges, net of $599 million and a goodwill impairment charge of $30 million. Fiscal 2003 net loss includes a $218 million loss, net of income taxes, from discontinued operations as well as a $27 million loss, net of income taxes, related to the cumulative effect of accounting change recorded in conjunction with the adoption of Financial Accounting Standards Board Interpretation No. 46 , "Consolidation of Variable Interest Entities." 

(6)
The Power Systems business met the held for sale and discontinued operations criteria in fiscal 2007. As such, we have reclassified amounts previously reported to reflect this business in discontinued operations in all periods presented. For additional information regarding the divestiture of our Power Systems business, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Discontinued Operations" and Note 5 to the Consolidated and Combined Financial Statements.

(7)
For all periods prior to our separation from Tyco International, basic and diluted earnings (loss) per share were calculated utilizing the basic shares outstanding at June 29, 2007, the date of separation.

(8)
Working capital is defined as current assets minus current liabilities.

 ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
        The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Consolidated and Combined Financial Statements and the accompanying notes included elsewhere in this Annual Report. The following discussion may contain forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those factors discussed below and elsewhere in this Annual Report, particularly in "Risk Factors" and "Forward-Looking Information."
Separation From Tyco International Ltd.
        Effective June 29, 2007, Tyco Electronics Ltd. ("Tyco Electronics" or the "Company", which may be referred to as "we," "us," or "our"), a company organized under the laws of Bermuda, became the parent company of the former electronics businesses of Tyco International Ltd. ("Tyco International"). On June 29, 2007, Tyco International distributed all of its shares of Tyco Electronics, as well as its shares of its former healthcare businesses ("Covidien"), to its common shareholders (the "Separation").
        The Consolidated and Combined Financial Statements reflect the consolidated operations of Tyco Electronics Ltd. and its subsidiaries as an independent, publicly-traded entity as of June 29, 2007 and a combined reporting entity comprising the assets and liabilities used in managing and operating the electronics businesses of Tyco International, including Tyco Electronics Ltd., prior to June 29, 2007.
        Our Consolidated and Combined Financial Statements have been prepared in United States dollars, in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Consolidated and Combined Financial Statements for periods prior to and including June 29, 2007 may not be indicative of our future performance and do not necessarily reflect what our
41

consolidated and combined results of operations, financial position, and cash flows would have been had we operated as an independent, publicly-traded company during the periods presented, including changes in our operations and capitalization as a result of our separation from Tyco International. Certain general corporate overhead, net class action settlement costs, and other expenses as well as debt and related net interest expense for periods prior to the Separation have been allocated to us by Tyco International. Management believes such allocations are reasonable; however, they may not be indicative of our actual results had we been operating as an independent, publicly-traded company for the periods presented. See Note 17 to the Consolidated and Combined Financial Statements for further information regarding allocated expenses.
        As discussed elsewhere in this Annual Report, prior to the Separation, we used the corporate services of Tyco International for a variety of functions including treasury, tax, legal, internal audit, human resources, and risk management. We currently perform these functions. The costs of these functions may be different than prior to the Separation. We also may incur additional costs associated with being an independent, publicly-traded company. These additional anticipated costs are not reflected in our historical Combined Financial Statements for periods prior to June 29, 2007.
Overview
        We are a leading global provider of engineered electronic components, network solutions, wireless systems, and undersea telecommunication systems. We operate through four reporting segments: Electronic Components, Network Solutions, Wireless Systems, and Undersea Telecommunications. We design, manufacture, and market approximately 500,000 different products for customers in industries ranging from automotive, appliance, and aerospace and defense to telecommunications, computer, and consumer electronics. We believe the end markets that we sell into are balanced with the total end market demand for electronic components.
        We service our customers primarily through our direct sales force that serves customers in over 150 countries. The sales force is supported by over 8,000 engineers, as well as globally deployed manufacturing sites. Through our sales force and engineering resources, we are able to collaborate with our customers anywhere in the world to provide highly engineered products and solutions to meet their needs.
        Our strategic objective is to increase our revenue and profitability across all of our segments in the markets we serve. This strategy is dependent upon the following strategic priorities:
•
continue to focus our existing portfolio;

•
leverage our market leadership position to increase our market share;

•
achieve market leadership in attractive and under-penetrated industries;

•
extend our leadership in key emerging markets;

•
supplement organic growth with strategic acquisitions;

•
improve operating margins; and

•
accelerate new product development through research and development excellence.
        Key business factors that influenced our results of operations for the periods discussed in this Management's Discussion and Analysis of Financial Condition and Results of Operations include:
•
Market conditions.     We have experienced sales growth that was driven by the continued increased use of electronics across the end markets that we serve. This sales growth was achieved despite industry pricing pressures. Over the periods shown, we have experienced price erosion in the range of 2% to 4%. We expect price erosion to continue in the future. The
42

increase in our net sales for each fiscal year in the periods shown reflects volume increases that more than offset the impact of pricing pressures.
•
Raw material price increases.     We purchase approximately 200 million pounds of copper and approximately 250,000 troy ounces of gold annually. During the periods shown, the prices of these key raw materials, as well as the prices of certain other raw materials, have increased substantially. The following table illustrates the increase in average prices related to the most significant raw materials, copper and gold, during the periods presented:

 	 	 	 	Fiscal Year
	
 	 	Measure
	 	2007
	 	2006
	 	2005
	
Copper	 	Lb.	 	$	3.20	 	$	2.80	 	$	1.53	
Gold	 	Troy oz.	 	$	653	 	$	572	 	$	432	
As a general matter, we have been able to pass only a portion of the increased cost of these raw materials through to our customers. As a result, raw materials price increases adversely affected our gross margins.
•
Foreign exchange.     Approximately 50% of our net sales are invoiced in currencies other than the U.S. dollar. Our results of operations are influenced by changes in foreign currency exchange rates. Increases or decreases in the value of the U.S. dollar, compared to other currencies, will directly affect our reported results as we translate those currencies into U.S. dollars at the end of each fiscal period. The percentage of net sales in fiscal 2007 by major currencies invoiced was as follows:

US Dollar	 	50	%	
Euro	 	29	 	
Japanese Yen	 	6	 	
British Pound Sterling	 	3	 	
Chinese Renminbi	 	3	 	
Korean Won	 	2	 	
All Others	 	7	 	
 	 		 	
Total	 	100	%	
 	 		 	
Discontinued Operations
        The divestiture of our Power Systems business was authorized during fiscal 2007. As a result, we assessed Power Systems' assets for impairment under Statement of Financial Accounting Standards ("SFAS") No. 144 , "Accounting for the Impairment and Disposal of Long-Lived Assets," using a probability-weighted set of expected cash flows from the eventual disposition. We recorded a $435 million after-tax, $585 million pre-tax, impairment charge in the third quarter of fiscal 2007 in loss from discontinued operations, net of income taxes on the Consolidated and Combined Statement of Operations. Subsequent to year end, we entered into a definitive agreement to sell the Power Systems business for $100 million in cash, subject to a final working capital adjustment. We expect to recognize a gain of approximately $40 million on this divestiture, which is expected to close in the first or second quarter of fiscal 2008. For additional information, see Note 26 to the Consolidated and Combined Financial Statements.
        During 2006, we entered into a definitive agreement to divest our Printed Circuit Group business. In the first quarter of fiscal 2007, we completed the sale of the Printed Circuit Group business for $227 million in net cash proceeds and recorded a $45 million pre-tax gain on the sale.
43

        The Power Systems and Printed Circuit Group businesses have been included in discontinued operations for all periods presented in our Consolidated and Combined Financial Statements. Prior to reclassification as held for sale, these businesses were components of the Other segment, which has been renamed the Undersea Telecommunications segment. See Note 5 to the Consolidated and Combined Financial Statements for additional information regarding discontinued operations.
Divestitures and Manufacturing Simplification
        As part of our strategy, we regularly review and consider the divestiture of underperforming or non-strategic businesses to improve our operating results and better utilize our capital. Some of these divestitures may have a material impact on our Consolidated Financial Statements. We currently believe that these divestitures, including the divestiture of the Power Systems business as discussed above and other product exits, could reduce our consolidated net sales by approximately 15%. We have made strategic divestitures in the past, such as our Printed Circuit Group business discussed above, and expect that we may make additional divestitures in the future.
        We plan to continue to simplify our global manufacturing footprint, by migrating facilities from high-cost to low-cost countries, consolidating within countries, and transferring product lines to low-cost countries. These initiatives are designed to help us to maintain our competitiveness in the industry. In connection with our manufacturing rationalization plan, we expect to incur restructuring charges of approximately $130 million in fiscal 2008 and up to $250 million from fiscal 2009 through 2010.
        In November 2004, we agreed to sell the Tyco Global Network, our undersea fiber optic telecommunications network. This business had been part of our Other segment, which has been renamed the Undersea Telecommunications segment. We closed this sale on June 30, 2005. As part of the sale, we received cash proceeds of $130 million, and the purchaser assumed certain liabilities. The divestiture resulted in a pre-tax gain on sale of $301 million. See Note 5 to the Consolidated and Combined Financial Statements for additional information regarding divestitures.
Class Action Settlement
        On May 14, 2007, Tyco International entered into a memorandum of understanding with plaintiffs' counsel in connection with the settlement of 32 purported securities class action lawsuits. The memorandum of understanding does not resolve all securities cases, and several remain outstanding. In addition, the proposed settlement does not release claims arising under ERISA.
        Under the terms of the memorandum of understanding, the plaintiffs have agreed to release all claims against Tyco International, the other settling defendants, and ten other individuals in consideration for the payment of $2,975 million from Tyco International to the certified class. The parties to the memorandum of understanding applied to the court for approval of the settlement agreement. On July 13, 2007, the court granted preliminary approval of the settlement. On November 2, 2007, the final fairness hearing for the class settlement was held, and the court indicated it would approve the settlement and stated a formal ruling would be issued shortly. If the settlement agreement does not receive final court approval, the memorandum of understanding will be null and void. By December 28, 2007, class participants must file their proofs of claim demonstrating their right to recovery under the class settlement.
        Under the terms of the Separation and Distribution Agreement that was entered into in connection with the Separation, Tyco International, Covidien, and Tyco Electronics are jointly and severally liable for the full amount of the class action settlement. Additionally, under the Separation and Distribution Agreement, the companies share in the liability and related escrow account with Tyco International assuming 27%, Covidien 42%, and Tyco Electronics 31% of the total settlement amount.
44

        In the third quarter of fiscal 2007, we were allocated a charge from Tyco International of $922 million for which no tax benefit was available. In addition, in fiscal 2007, we were allocated $35 million of income relating to Tyco International's expected recovery of certain costs from insurers, of which $31 million has been collected. The net charge of $887 million has been recorded on the Consolidated and Combined Statement of Operations as allocated class action settlement costs, net. The portions allocated to us are consistent with the sharing percentage included in the Separation and Distribution Agreement. Tyco International placed funds in escrow for the benefit of the class. The escrow account earns interest that is payable to the class. In addition, interest is accrued on the class action settlement liability. At fiscal year end 2007, we recorded $928 million on the Consolidated Balance Sheet for our portion of the escrow. We also recorded a $2,992 million liability and a $2,064 million receivable from Tyco International and Covidien for their portion of the liability at fiscal year end 2007.
        If the proposed settlement were not consummated on the agreed terms or if the unresolved proceedings were to be determined adversely to Tyco International, our share of any additional potential losses, which are not presently estimable, may have a material adverse effect on our financial position, results of operations, or cash flows.
Non-GAAP Financial Measures
        Organic net sales growth, which is included in the discussion below, is a non-GAAP financial measure. The difference between reported net sales growth (the most comparable GAAP measure) and organic net sales growth (the non-GAAP measure) consists of the impact from foreign currency exchange rates, acquisitions, and divestitures. Organic net sales growth is a useful measure which we use to measure the underlying results and trends in our business. It excludes items that are not completely under management's control, such as the impact of changes in foreign currency exchange rates, and items that do not reflect the underlying growth of the company, such as acquisition and divestiture activity.
        We believe organic net sales growth provides useful information to investors because it reflects the underlying growth from the ongoing activities of our business. Furthermore, it provides investors with a view of our operations from management's perspective. We use organic net sales growth to monitor and evaluate performance, as it is an important measure of the underlying results of our operations. Management uses organic net sales growth together with GAAP measures such as net sales growth and operating income in its decision making processes related to the operations of our reporting segments and our overall company. We believe that investors benefit from having access to the same financial measures that management uses in evaluating operations. The discussion and analysis of organic net sales growth in Results of Operations below utilizes organic net sales growth as management does internally. Because organic net sales growth calculations may vary among other companies, organic net sales growth amounts presented below may not be comparable with similarly titled measures of other companies. Organic net sales growth is a non-GAAP financial measure that is not meant to be considered in isolation or as a substitute for GAAP measures. The primary limitation of this measure is that it excludes items that have an impact on our net sales. This limitation is best addressed by evaluating organic net sales growth in combination with our GAAP net sales. The tables presented in Results of Operations below provide reconciliations of organic net sales growth to net sales growth calculated under GAAP.
45

 Results of Operations
Consolidated and Combined Operations
        The following table sets forth certain items from our Consolidated and Combined Statements of Operations and the percentage of net sales that such items represent for the periods shown.

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Net sales	 	$	13,460	 	100.0	%	$	12,300	 	100.0	%	$	11,433	 	100.0	%	
Cost of sales	 	 	10,012	 	74.4	 	 	8,999	 	73.2	 	 	8,334	 	72.9	 	
 	Gross income	 	 	3,448	 	25.6	 	 	3,301	 	26.8	 	 	3,099	 	27.1	 	
Selling, general, and administrative expenses	 	 	1,664	 	12.4	 	 	1,524	 	12.4	 	 	1,403	 	12.3	 	
Allocated class action settlement costs, net	 	 	887	 	6.6	 	 	—	 	—	 	 	—	 	—	 	
Separation costs	 	 	45	 	0.3	 	 	—	 	—	 	 	—	 	—	 	
Restructuring and other charges (credits), net	 	 	99	 	0.7	 	 	13	 	0.1	 	 	(10	)	(0.1	)	
Goodwill impairment	 	 	—	 	—	 	 	316	 	2.6	 	 	—	 	—	 	
Gain on divestiture	 	 	—	 	—	 	 	—	 	—	 	 	(301	)	(2.6	)	
 	Income from operations	 	 	753	 	5.6	 	 	1,448	 	11.8	 	 	2,007	 	17.6	 	
Interest income	 	 	53	 	0.4	 	 	48	 	0.4	 	 	44	 	0.4	 	
Interest expense	 	 	(231	)	(1.7	)	 	(256	)	(2.1	)	 	(293	)	(2.6	)	
Other expense, net	 	 	(219	)	(1.6	)	 	—	 	—	 	 	(365	)	(3.2	)	
 	Income from continuing operations before income taxes and minority interest	 	 	356	 	2.6	 	 	1,240	 	10.1	 	 	1,393	 	12.2	 	
Income taxes	 	 	(494	)	(3.7	)	 	(46	)	(0.4	)	 	(376	)	(3.3	)	
 	(Loss) income from continuing operations	 	 	(144	)	(1.1	)	 	1,188	 	9.7	 	 	1,011	 	8.8	 	
(Loss) income from discontinued operations, net of income taxes	 	 	(410	)	(3.0	)	 	13	 	0.1	 	 	122	 	1.1	 	
Net (loss) income	 	$	(554	)	(4.1	)%	$	1,193	 	9.7	%	$	1,144	 	10.0	%	
        Net Sales.     Net sales increased $1,160 million, or 9.4%, to $13,460 million in fiscal 2007 from $12,300 million in fiscal 2006. In fiscal 2006, net sales increased $867 million, or 7.6%, to $12,300 million from $11,433 million in fiscal 2005. Foreign currency exchange rates, primarily the euro, favorably impacted net sales by $429 million, or 3.5%, in fiscal 2007, negatively impacted net sales by $172 million, or 1.5%, in fiscal 2006, and favorably impacted net sales by $278 million, or 2.6%, in fiscal 2005. On an organic basis, net sales increased 5.8% in fiscal 2007 primarily reflecting strong growth in our Undersea Telecommunications segment and sales in international markets. In fiscal 2006 and fiscal 2005, organic net sales growth was 9.2% and 5.1%, respectively, reflecting increases in volume partially offset by price erosion. Price erosion adversely affected net sales by $226 million in fiscal 2007, $313 million in fiscal 2006, and $426 million in fiscal 2005. See further discussion below under Results of Operations by Segment.
        The following table sets forth the percentage of our total net sales by geographic region:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Americas	 	37	%	38	%	39	%	
Europe/Middle East/Africa (EMEA)	 	36	 	35	 	36	 	
Asia-Pacific	 	27	 	27	 	25	 	
 	 		 		 		 	
Total	 	100	%	100	%	100	%	
 	 		 		 		 	
46

        The following table provides an analysis of the change in our net sales compared to the prior fiscal year by geographic region:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	Change in Net Sales versus Prior Fiscal Year
	 	
 	 	Change in Net Sales versus Prior Fiscal Year
			 	
 			 	 	 	 	 	 	 	Acquisitions
(Divestitures)
	 	 	 	 	 	
 	 	Organic (1)
	 	Translation (2)
	 	Acquisitions
	 	Total
	 	Organic (1)
	 	Translation (2)
			 	Total
	 	
 	 	($ in millions)
	 	
Americas (3)	 	$	188	 	4.1	%	$	102	 	$	—	 	$	290	 	6.3	%	$	125	 	2.8	%	$	91	 	$	(29	)	$	187	 	4.2	%	
Europe/Middle East/Africa	 	 	224	 	5.2	 	 	307	 	 	17	 	 	548	 	12.7	 	 	397	 	9.7	 	 	(192	)	 	11	 	 	216	 	5.3	 	
Asia-Pacific	 	 	302	 	9.0	 	 	20	 	 	—	 	 	322	 	9.6	 	 	535	 	18.5	 	 	(71	)	 	—	 	 	464	 	16.0	 	
 	 		 		 		 		 		 		 		 		 		 		 		 		 	
Total	 	$	714	 	5.8	%	$	429	 	$	17	 	$	1,160	 	9.4	%	$	1,057	 	9.2	%	$	(172	)	$	(18	)	$	867	 	7.6	%	

(1)
Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates.

(2)
Represents the change in net sales resulting from changes in foreign currency exchange rates.

(3)
The Americas includes our Undersea Telecommunications segment.
        The following table sets forth the percentage of our total net sales by segment:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Electronic Components	 	75	%	76	%	77	%	
Network Solutions	 	14	 	14	 	13	 	
Wireless Systems	 	7	 	7	 	8	 	
Undersea Telecommunications	 	4	 	3	 	2	 	
 	 		 		 		 	
Total	 	100	%	100	%	100	%	
 	 		 		 		 	
        The following table provides an analysis of the change in our net sales compared to the prior fiscal year by segment:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	Change in Net Sales versus Prior Fiscal Year
	 	
 	 	Change in Net Sales versus Prior Fiscal Year
			 	
 			 	 	 	 	 	 	 	Acquisitions
(Divestitures)
	 	 	 	 	 	
 	 	Organic (1)
	 	Translation (2)
	 	Acquisitions
	 	Total
	 	Organic (1)
	 	Translation (2)
			 	Total
	 	
 	 	($ in millions)
	 	
Electronic Components	 	$	375	 	4.0	%	$	333	 	$	17	 	$	725	 	7.7	%	$	769	 	8.8	%	$	(151	)	$	11	 	$	629	 	7.2	%	
Network Solutions	 	 	61	 	3.5	 	 	96	 	 	—	 	 	157	 	9.0	 	 	238	 	15.6	 	 	(24	)	 	—	 	 	214	 	14.0	 	
Wireless Systems	 	 	12	 	1.4	 	 	1	 	 	—	 	 	13	 	1.5	 	 	1	 	0.1	 	 	2	 	 	—	 	 	3	 	0.3	 	
Undersea Telecommunications	 	 	266	 	88.9	 	 	(1	)	 	—	 	 	265	 	88.3	 	 	49	 	17.4	 	 	1	 	 	(29	)	 	21	 	7.5	 	
 	 		 		 		 		 		 		 		 		 		 		 		 		 	
Total	 	$	714	 	5.8	%	$	429	 	$	17	 	$	1,160	 	9.4	%	$	1,057	 	9.2	%	$	(172	)	$	(18	)	$	867	 	7.6	%	

(1)
Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates.

(2)
Represents the change in net sales resulting from changes in foreign currency exchange rates.
        Cost of Sales and Gross Income.     In fiscal 2007, gross income increased by $147 million over fiscal 2006; however, gross income as a percentage of net sales decreased by 120 basis points. Our margin percentage declined due to higher organic growth in lower margin markets such as Undersea Telecommunications. We also were negatively impacted by lower plant productivity in North America as a result of sales declines in that market by our Electronic Components segment in fiscal 2007.
47

        Gross income increased by $202 million in fiscal 2006 over fiscal 2005, but decreased as a percentage of net sales by 30 basis points. This decline as a percentage of net sales was attributable to increases in raw material costs, primarily metals, which unfavorably affected fiscal 2006 gross income by $293 million when compared to fiscal 2005.
        Selling, General, and Administrative Expenses.     Selling, general, and administrative expenses as a percentage of net sales were 12.4% in both fiscal 2007 and fiscal 2006. Prior to Separation, selling, general, and administrative expenses included allocated overhead expenses from Tyco International, which decreased by $25 million to $152 million in fiscal 2007 as compared to $177 million in fiscal 2006. We incurred costs of $41 million in fiscal 2007 related to building separate company functions that did not exist in the prior fiscal year. A portion of these costs were duplicative in fiscal 2007 as we were also allocated costs related to these functions from Tyco International until the Separation date. Selling, general, and administrative expenses also included a $24 million gain on the sale of real estate in fiscal 2007 that related to our Wireless Systems segment.
        Selling, general, and administrative expenses as a percentage of net sales were 12.4% and 12.3% in fiscal 2006 and fiscal 2005, respectively. Selling, general, and administrative expenses include the effect of the adoption of SFAS No. 123R, " Share Based Payment," which resulted in incremental stock option charges of $40 million in fiscal 2006, as compared to fiscal 2005.
        Allocated Class Action Settlement Costs, Net.     As discussed above, in connection with the class action settlement, we were allocated a net charge from Tyco International of $887 million in fiscal 2007. See Note 16 to the Consolidated and Combined Financial Statements for further information regarding the class action settlement and allocated net costs.
        Separation Costs.     In connection with the Separation, we incurred costs of $45 million in fiscal 2007, primarily related to employee costs, including $11 million of non-cash compensation expense related to the conversion of share option awards at Separation and $13 million related to the acceleration of restricted share award vesting as a result of Separation. See Note 23 to the Consolidated and Combined Financial Statements for further information on the conversion of Tyco International share option awards into Tyco Electronics share option awards and the acceleration of restricted share award vesting.
        Restructuring and Other Charges (Credits), Net.     Net restructuring and other charges were $99 million in fiscal 2007 compared to $13 million in fiscal 2006. Total charges, including amounts reflected in cost of sales, increased $85 million to $104 million in fiscal 2007 from $19 million in fiscal 2006. Increases resulted from our strategic priority to simplify our manufacturing footprint.
        During fiscal 2007, we initiated restructuring actions to exit manufacturing operations and migrate product lines to low cost countries in the Electronic Components and Network Solutions segments and to rationalize certain product lines in the Wireless Systems segment. Restructuring charges recorded in fiscal 2007 primarily related to employee severance and benefits.
        Net restructuring and other credits of $10 million in fiscal 2005 primarily resulted from the sale of previously written down assets for amounts greater than originally estimated and the completion of exit activities related to previously acquired operations for amounts less than originally established as acquisition liabilities.
        See Note 4 to the Consolidated and Combined Financial Statements for further information regarding restructuring and other charges (credits), net.
        Goodwill Impairment.     During fiscal 2006, we recorded a goodwill impairment of $316 million in our Wireless Systems segment related to the Integrated Wireless Products reporting unit. This impairment was incurred when the reporting unit experienced slower growth and profitability than management's previous experience and future expectations due to declines in certain end markets. See
48

Note 9 to our Consolidated and Combined Financial Statements for additional information regarding the fiscal 2006 goodwill impairment. There were no goodwill impairments during fiscal 2007 or 2005.
        Gain on Divestiture.     In fiscal 2005, income from continuing operations benefited from the pre-tax $301 million gain on the divestiture of the Tyco Global Network.
        Income from Operations.     Income from operations was $753 million, or 5.6% of net sales, in fiscal 2007 as compared to $1,448 million, or 11.8%, of net sales, in fiscal 2006. The decline resulted primarily from allocated net class action settlement costs of $887 million in fiscal 2007 and a higher level of restructuring and other charges of $85 million related to our strategic initiative to simplify our manufacturing operations.
        Income from operations was $1,448 million in fiscal 2006 compared to $2,007 million in fiscal 2005. The decrease was driven by a goodwill impairment of $316 million in fiscal 2006 as well as a gain on divestiture in fiscal 2005 of $301 million. The remaining change was driven by an increase in net sales negatively offset by increased raw material costs.
Results of Operations by Segment
Electronic Components

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Net sales	 	$	10,111	 	$	9,386	 	$	8,757	 	
Income from operations	 	$	1,339	 	$	1,404	 	$	1,398	 	
 	Operating margin	 	 	13.2	%	 	15.0	%	 	16.0	%	
        The following table sets forth Electronic Components' percentage of total net sales by primary industry end market (1) :

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Automotive	 	39	%	38	%	40	%	
Computer	 	11	 	12	 	11	 	
Communication Equipment	 	8	 	8	 	7	 	
Appliance	 	5	 	5	 	5	 	
Industrial Machinery	 	5	 	5	 	4	 	
Aerospace and Defense	 	4	 	3	 	3	 	
Consumer Electronics	 	2	 	2	 	2	 	
Other	 	26	 	27	 	28	 	
 	 		 		 		 	
 	Total	 	100	%	100	%	100	%	

(1)
Industry end market information about net sales is presented consistently with our internal management reporting and may be periodically revised as management deems necessary.
49

        The following table provides an analysis of the change in Electronic Components' net sales compared to the prior fiscal year by primary industry end market (1) :

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	Change in Net Sales versus Prior Fiscal Year
	 	Change in Net Sales versus Prior Fiscal Year
	 	
 	 	Organic (2)
	 	Translation (3)
	 	Acquisitions
(Divestitures)
	 	Total
	 	Organic (2)
	 	Translation (3)
	 	Acquisitions
(Divestitures)
	 	Total
	 	
 	 	($ in millions)
	 	
Automotive	 	$	192	 	5.4	%	$	176	 	$	17	 	$	385	 	10.8	%	$	172	 	5.0	%	$	(70	)	$	11	 	$	113	 	3.3	%	
Computer	 	 	(44	)	(3.9	)	 	17	 	 	—	 	 	(27	)	(2.4	)	 	115	 	11.5	 	 	(5	)	 	—	 	 	110	 	11.0	 	
Communication Equipment	 	 	45	 	6.1	 	 	22	 	 	—	 	 	67	 	9.1	 	 	101	 	15.8	 	 	(5	)	 	—	 	 	96	 	15.0	 	
Appliance	 	 	17	 	3.5	 	 	16	 	 	—	 	 	33	 	6.7	 	 	42	 	9.5	 	 	(3	)	 	—	 	 	39	 	8.9	 	
Industrial Machinery	 	 	53	 	11.5	 	 	17	 	 	—	 	 	70	 	15.2	 	 	85	 	22.0	 	 	(16	)	 	—	 	 	69	 	17.9	 	
Aerospace and
Defense	 	 	32	 	10.5	 	 	9	 	 	—	 	 	41	 	13.4	 	 	9	 	3.1	 	 	(3	)	 	—	 	 	6	 	2.0	 	
Consumer Electronics	 	 	21	 	11.7	 	 	4	 	 	—	 	 	25	 	13.4	 	 	31	 	19.1	 	 	(1	)	 	—	 	 	30	 	18.5	 	
Other	 	 	59	 	2.3	 	 	72	 	 	—	 	 	131	 	5.1	 	 	214	 	9.2	 	 	(48	)	 	—	 	 	166	 	7.1	 	
 	 		 		 		 		 		 		 		 		 		 		 		 		 	
Total	 	$	375	 	4.0	%	$	333	 	$	17	 	$	725	 	7.7	%	$	769	 	8.8	%	$	(151	)	$	11	 	$	629	 	7.2	%	

(1)
Industry end market information about net sales is presented consistently with our internal management reporting and may be periodically revised as management deems necessary.

(2)
Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates.

(3)
Represents the change in net sales resulting from changes in foreign currency exchange rates.

Fiscal 2007 Compared to Fiscal 2006
        Electronic Components' net sales increased $725 million, or 7.7%, to $10,111 million in fiscal 2007 from $9,386 million in fiscal 2006. Approximately $333 million, or 3.5%, of the increase was due to the strengthening of certain foreign currencies in fiscal 2007 as compared to fiscal 2006. Organic net sales growth of 4.0% in fiscal 2007 over fiscal 2006 was attributable to increases in volume partially offset by price erosion.
        In fiscal 2007, Electronic Components' organic net sales growth by industry end market was strongest in the consumer electronics, industrial machinery, and aerospace and defense end markets. Our organic growth of 11.7% in the consumer electronics market in fiscal 2007 as compared to fiscal 2006 resulted from continued strong consumer demand as well as our continued focus on this market. In the industrial machinery market, our organic net sales growth of 11.5% in fiscal 2007 over fiscal 2006 resulted from strong demand globally as companies continued to invest in factory automation. In the aerospace and defense market, our organic net sales growth of 10.5% in fiscal 2007 over fiscal 2006 was driven primarily by strength in North America and Europe in the commercial aerospace market. Our organic net sales growth of 5.4% in the automotive market in fiscal 2007 over fiscal 2006 was attributable to growth in the Asia-Pacific region of 13.0% and the EMEA region of 5.4% partially offset by a decline in the North America region that was driven by reduced production by automotive manufacturers. Finally, in the computer market, our organic net sales declined 3.9% in fiscal 2007 as compared to fiscal 2006 due to a strategic decision to exit certain low-margin products which negatively impacted net sales by $83 million.
        Electronic Components' operating income decreased $65 million, or 4.6%, to $1,339 million fiscal 2007 from $1,404 million in fiscal 2006. Benefits from higher sales and favorable foreign currency increases were reduced by lower productivity resulting from sales declines in North America primarily in automotive, housing related, and communication equipment markets. Also, restructuring costs in
50

fiscal 2007 increased $45 million as compared to fiscal 2006, and segment results included $33 million of costs in fiscal 2007 that related to our separation from Tyco International that did not exist in fiscal 2006.
Fiscal 2006 Compared to Fiscal 2005
        In fiscal 2006, Electronic Components' net sales increased $629 million, or 7.2%, to $9,386 million from $8,757 million in fiscal 2005. The weakening of certain foreign currencies negatively affected net sales by $151 million, or 1.7%. Organic net sales growth of 8.8% in fiscal 2006 resulted from increases in volume partially offset by price erosion.
        Electronic Components' fiscal 2006 organic net sales growth by industry end market was strongest in the communication equipment, computer, industrial machinery, and consumer electronics markets. Our organic net sales growth of 15.8% in the communication equipment market in fiscal 2006 over fiscal 2005 was driven by strong demand across the entire market including infrastructure equipment and mobile phones. In the computer market, our organic net sales growth of 11.5% was driven by computer shipment growth that was strong throughout all of fiscal 2006. In the industrial machinery market, our organic net sales growth of 22.0% resulted from strong demand globally as companies continued to invest in factory automation. In the consumer electronics market, our organic net sales growth of 19.1% in fiscal 2006 over fiscal 2005 was attributable to continued strong consumer demand as well as our continued increased focus on this market. Our organic net sales growth of 5.0% in the automotive market resulted from strong growth in Asia-Pacific of 8.5% offset by flat sales in EMEA and the Americas. In the aerospace and defense market, our organic net sales growth slowed to 3.1% in fiscal 2006 due to a slowdown in defense electronics spending in the programs in which we participate, offset by increased sales related to commercial aircraft builds.
        Electronic Components' operating income increased $6 million to $1,404 million in fiscal 2006 from $1,398 million in fiscal 2005. Benefits from increased sales volume and cost improvement initiatives were offset by price erosion and increased raw material prices in fiscal 2006. Increased raw material costs negatively affected margins by $261 million in fiscal 2006 as compared to fiscal 2005. Also, the adoption of SFAS No. 123R negatively affected fiscal 2006 results by $33 million. Finally, the weakening of certain foreign currencies negatively impacted fiscal 2006 results by $19 million as compared to fiscal 2005.
Network Solutions

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Net sales	 	$	1,897	 	$	1,740	 	$	1,526	 	
Income from operations	 	$	231	 	$	268	 	$	225	 	
 	Operating margin	 	 	12.2	%	 	15.4	%	 	14.7	%	
        The following table sets forth Network Solutions' percentage of total net sales by primary industry end market (1) :

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Energy	 	45	%	44	%	45	%	
Communication Service Provider	 	28	 	31	 	30	 	
Building Networks	 	24	 	22	 	21	 	
Other	 	3	 	3	 	4	 	
 	 		 		 		 	
 	Total	 	100	%	100	%	100	%	

(1)
Industry end market information about net sales is presented consistently with our internal management reporting and may be periodically revised as management deems necessary.
51

        The following table provides an analysis of the change in Network Solutions' net sales compared to the prior fiscal year by primary industry end market (1) :

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	Change in Net Sales versus Prior Fiscal Year
	 	Change in Net Sales versus Prior Fiscal Year
	 	
 	 	Organic (2)
	 	Translation (3)
	 	Total
	 	Organic (2)
	 	Translation (3)
	 	Total
	 	
 	 	($ in millions)
	 	
Energy	 	$	43	 	5.7	  %	$	47	 	$	90	 	11.9	%	$	69	 	10.1	%	$	6	 	$	75	 	11.0	%	
Communication Service Provider	 	 	(41	)	(7.4	)	 	25	 	 	(16	)	(2.9	)	 	101	 	22.3	 	 	(4	)	 	97	 	21.5	 	
Building Networks	 	 	61	 	16.2	 	 	19	 	 	80	 	21.4	 	 	64	 	19.9	 	 	(10	)	 	54	 	16.9	 	
Other	 	 	(2	)	(2.7	)	 	5	 	 	3	 	5.0	 	 	4	 	5.6	 	 	(16	)	 	(12	)	(16.7	)	
 	 		 		 		 		 		 		 		 		 		 		 	
Total	 	$	61	 	3.5	  %	$	96	 	$	157	 	9.0	%	$	238	 	15.6	%	$	(24	)	$	214	 	14.0	%	

(1)
Industry end market information about net sales is presented consistently with our internal management reporting and may be periodically revised as management deems necessary.

(2)
Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates.

(3)
Represents the percentage change in net sales resulting from changes in foreign currency exchange rates.
Fiscal 2007 Compared to Fiscal 2006
        Network Solutions' net sales increased $157 million, or 9.0%, to $1,897 million in fiscal 2007 from $1,740 million in fiscal 2006. The strengthening of certain foreign currencies, primarily the euro, favorably affected net sales by $96 million, or 5.5%, in fiscal 2007 over fiscal 2006. Organic net sales growth was $61 million, or 3.5%, in fiscal 2007 over fiscal 2006.
        In fiscal 2007, Network Solutions' organic net sales growth was strong in the building networks and energy end markets; however, our organic net sales declined in the communication service provider market. In the building networks market, our organic net sales growth of 16.2% in fiscal 2007 over fiscal 2006 resulted from higher pricing on copper cabling products as well as increases in non-residential construction spending and network upgrades in existing buildings. Our organic net sales growth of 5.7% in the energy market in fiscal 2007 as compared to fiscal 2006 resulted from solid growth in EMEA due to continued strong demand for high voltage products used to replace/upgrade aging grids in developed countries. On an organic basis, net sales decreased 7.4% in the communication service provider market in fiscal 2007 as compared to fiscal 2006, reflecting a pause in spending on fiber network deployments by certain operators compared to strong sales in the same period last year due to hurricane-related spending in the Americas and the accelerated build-out of fiber networks by certain operators in Europe.
        Network Solutions' operating income decreased $37 million, or 13.8%, to $231 million in fiscal 2007 from $268 million in fiscal 2006. Price increases offset increased raw material costs. The operating income decrease resulted from a $26 million increase in restructuring cost and a lower margin sales mix due to the sales decline in the communication service provider market in fiscal 2007 as compared to fiscal 2006. Also, in fiscal 2007, we incurred $5 million of costs related to our separation from Tyco International that did not exist in fiscal 2006.
Fiscal 2006 Compared to Fiscal 2005
        Network Solutions' net sales increased $214 million, or 14.0%, to $1,740 million in fiscal 2006 from $1,526 million in fiscal 2005. Organic net sales growth of $238 million, or 15.6%, in fiscal 2006 over fiscal 2005, resulted primarily from increases in volume. Organic net sales growth was partially offset by
52

$24 million, or 1.6%, of unfavorable changes in foreign currency exchange rates. The impact of price erosion on fiscal 2006 net sales was minimal as a result of our pricing actions to recover material cost increases.
        In fiscal 2006, Network Solutions' organic net sales growth was strong across the energy, communication service provider, and building networks industry end markets. In the energy market, our organic net sales growth of 10.1% in fiscal 2006 over fiscal 2005 was due primarily to the continued increased spending on grid infrastructure improvements, as well as the build-out of the grid infrastructure in emerging markets. Our organic growth of 22.3% in the communication service provider market in fiscal 2006 over fiscal 2005 was driven by the continued build-out by certain operators in Europe and the United States of fiber networks and, to a lesser extent, sales that were driven by the rebuilding required in the United States resulting from hurricane activity. In the building networks market, our organic growth of 19.9% in fiscal 2006 over fiscal 2005 resulted from increased non-residential construction spending, increased spending to upgrade networks in existing buildings, and increased pricing to offset increased raw material costs.
        Network Solutions' operating income increased $43 million, or 19.1%, to $268 million in fiscal 2006 from $225 million in fiscal 2005. The improvement was driven by the net sales growth of 14.0% in fiscal 2006 over fiscal 2005. The benefits of pricing actions and cost improvement initiatives were partially offset by increased raw material costs, primarily metals, of $28 million in fiscal 2006 and the $4 million negative impact related to the adoption of SFAS No. 123R in fiscal 2006.
Wireless Systems

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Net sales	 	$	887	 	$	874	 	$	871	 	
Income (loss) from operations	 	$	77	 	$	(239	)	$	92	 	
 	Operating margin	 	 	8.7	%	 	(27.3	)%	 	10.6	  %	
Fiscal 2007 Compared to Fiscal 2006
        In fiscal 2007, Wireless Systems' net sales increased $13 million, or 1.5%, to $887 million over $874 million in fiscal 2006. Organic net sales growth of $12 million, or 1.4%, in fiscal 2007 as compared to fiscal 2006 resulted from increases in volume partially offset by price erosion. The impact of foreign currency exchange rates was minimal.
        Wireless Systems' organic net sales growth in fiscal 2007 as compared to fiscal 2006 was driven by growth in the automotive and public safety markets offset by declines in the communication infrastructure market.
        In fiscal 2007, Wireless Systems' operating income increased $316 million, or 132.2%, to $77 million from a loss of $239 million in fiscal 2006. As discussed above, during fiscal 2006, we recorded a goodwill impairment of $316 million in our Wireless Systems segment for the Integrated Wireless Products reporting unit which manufactures and sells our radio frequency components. In fiscal 2007, operating income included a $24 million gain on the sale of real estate. Increased engineering and selling investment in fiscal 2007 as compared to fiscal 2006 negatively impacted operating income. In addition, operating income was negatively impacted by increased restructuring costs of $5 million in fiscal 2007 as compared to fiscal 2006 and $2 million of costs related to our separation from Tyco International in fiscal 2007 that did not exist in fiscal 2006.
53

Fiscal 2006 Compared to Fiscal 2005
        Wireless Systems' net sales increased $3 million to $874 million in fiscal 2006 from $871 million in fiscal 2005. Organic net sales were flat in fiscal 2006, as increases in volume were offset by price erosion. The impact of foreign currency translation was minimal. The flat organic net sales were driven by both our radio frequency components business and our land mobile radio business. The radio frequency components sales performance was affected by sales declines in the aerospace and defense and automotive markets as a result of programs coming to an end offset by increased sales to the communication infrastructure market. In land mobile radio, the sales level was influenced by a slowdown in United States federal programs in fiscal 2006 as compared to fiscal 2005.
        Wireless Systems' operating income decreased $331 million to an operating loss of $239 million in fiscal 2006 from operating income of $92 million in fiscal 2005. During fiscal 2006, we recorded a goodwill impairment of $316 million in our Wireless Systems segment for the Integrated Wireless Products reporting unit. Wireless Systems' fiscal 2006 operating income was also negatively impacted by $2 million related to the adoption of SFAS No. 123R in fiscal 2006.
Undersea Telecommunications

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Net sales	 	$	565	 	$	300	 	$	279	 	
Income from operations	 	$	38	 	$	15	 	$	292	 	
 	Operating margin	 	 	6.7	%	 	5.0	%	 	104.7	%	
Fiscal 2007 Compared to Fiscal 2006
        Net sales in the Undersea Telecommunications segment increased $265 million, or 88.3%, to $565 million in fiscal 2007 from $300 million in fiscal 2006. On an organic basis, net sales increased by 88.9% in fiscal 2007 as compared to fiscal 2006 from our execution of the construction of a transoceanic system that connects the U.S. and China as well as a project in the oil and gas market.
        Undersea Telecommunications had operating income of $38 million in fiscal 2007 compared to $15 million in fiscal 2006 primarily as a result of increases in sales. Restructuring costs in fiscal 2007 increased $9 million as compared to fiscal 2006, and segment results included $1 million of costs in fiscal 2007 that related to our separation from Tyco International that did not exist in fiscal 2006.
Fiscal 2006 Compared to Fiscal 2005
        Net sales in the Undersea Telecommunications segment increased $21 million, or 7.5%, to $300 million in fiscal 2006 from $279 million in fiscal 2005. Organic net sales growth of 17.4% was driven by the continued increase in the number of regional system builds and upgrades of existing systems. Foreign currencies had a minimal impact on net sales. Fiscal 2006 net sales were negatively affected by the fiscal 2005 divestiture of the Tyco Global Network, which reported fiscal 2005 net sales of approximately $29 million.
        The Undersea Telecommunications segment had operating income of $15 million in fiscal 2006 compared to $292 million in fiscal 2005. In fiscal 2005, operating income benefited from the $301 million gain on the sale of the Tyco Global Network. The adoption of SFAS No. 123R negatively affected fiscal 2006 operating income by $1 million.
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Non-Operating Items
Interest Expense, Net
        Interest expense, net was $178 million in fiscal 2007, as compared to $208 million in fiscal 2006 and $249 million in fiscal 2005. The decrease of $30 million, or 14.4%, in fiscal 2007 from fiscal 2006 was driven by lower average debt levels. Decreases in net interest expense allocated by Tyco International were partially offset by interest incurred on our unsecured senior bridge loan and unsecured senior revolving credit facilities. The decrease of $41 million, or 16.5%, in fiscal 2006 from fiscal 2005 was driven by a reduction in net interest expense allocated by Tyco International reflecting lower average debt levels offset by higher borrowing rates.
        A portion of Tyco International's net interest expense was allocated to us through June 1, 2007. During fiscal 2007, 2006, and 2005, we were allocated net interest expense of $130 million, $201 million, and $239 million, respectively, which includes the effects of Tyco International's interest rate swaps. Management believes the interest expense allocation basis was reasonable. However, these amounts may not be indicative of the actual amounts that we would have incurred had we been operating as an independent, publicly-traded company for these periods.
Other Expense, Net
        Other expense, net of $219 million in fiscal 2007 includes an allocation from Tyco International of $232 million for loss on retirement of debt. Additionally, in fiscal 2007, we recorded other income of $13 million associated with Tyco International's and Covidien's share of certain contingent tax liabilities for unresolved tax matters of legacy Tyco International.
        Other expense, net of $365 million in fiscal 2005 consisted primarily of an expense allocation from Tyco International related to our portion of Tyco International's loss on retirement of debt.
Income Taxes
        Our effective tax rate for fiscal 2007 includes the effects of the pre-tax charges recorded in connection with the allocated class action settlement and the allocated loss on the retirement of debt for which no tax benefits were recorded. These impacts on the effective tax rate in fiscal 2007 were $312 million and $81 million, respectively. In addition, the fiscal 2007 effective tax rate reflects tax detriments related to increased borrowings in order to fund the class action settlement escrow and our separation from Tyco International.
        Our effective income tax rate was 3.7% and 27.0% for fiscal 2006 and 2005, respectively. The effective tax rate in fiscal 2006 includes a net release of $268 million of deferred tax asset valuation allowances in connection with improved profitability in certain jurisdictions, principally the U.S. Our U.S. results of operations in fiscal 2006 combined with other available evidence, including projections of future taxable income, indicated that it is more likely than not we will realize additional deferred tax assets in the future and accordingly the related valuation allowance was reduced. In addition to the valuation allowance release, effective tax rate was impacted by a $39 million state tax benefit recognized in fiscal 2006, primarily related to the Tyco Global Network divestiture, as well as $87 million of tax benefits associated with the receipt of a favorable non-U.S. tax ruling permitting the deduction of historical debt retirement costs. These decreases to the fiscal 2006 effective tax rate were partially offset by a $71 million detriment related to the impact of the goodwill impairment in the Wireless Systems segment for which a tax benefit was not fully realized. The effective tax rate in fiscal 2005 reflects the release of $129 million of deferred tax asset valuation allowances and $105 million of benefits recognized related to the Tyco Global Network divestiture, principally in the U.S.
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        The valuation allowance for deferred tax assets of $703 million and $611 million at fiscal year end 2007 and 2006, respectively, relates principally to the uncertainty of the utilization of certain deferred tax assets, primarily tax loss and credit carryforwards in various jurisdictions. We believe that we will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets on our Consolidated and Combined Balance Sheets. The valuation allowance was calculated in accordance with the provisions of SFAS No. 109, " Accounting for Income Taxes ," which requires a valuation allowance to be established or maintained when it is "more likely than not" that all or a portion of deferred tax assets will not be realized.
        The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We recognize potential liabilities and record tax liabilities and related interest for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether, and the extent to which, additional taxes and related interest will be due. These tax liabilities and related interest are reflected net of the impact of related tax loss carryforwards, as such tax loss carryforwards will be applied against these tax liabilities and will reduce the amount of cash tax payments due upon eventual settlement with the tax authorities. We adjust these liabilities in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the tax liabilities and related interest. Further, management has reviewed with tax counsel the issues raised by these taxing authorities and the adequacy of these recorded amounts. Substantially all of these potential tax liabilities and related interest are recorded in income taxes on the Consolidated and Combined Balance Sheets as payment is not expected within one year.
        Except for earnings that are currently distributed, no additional provision has been made for U.S. or non-U.S. income taxes on the undistributed earnings of subsidiaries or for unrecognized deferred tax liabilities for temporary differences related to investments in subsidiaries, as such earnings are expected to be permanently reinvested, the investments are essentially permanent in duration, or we have concluded that no additional tax liability will arise as a result of distribution of such earnings. A liability could arise if our intentions to permanently reinvest such earnings were to change and amounts were distributed by such subsidiaries or if such subsidiaries are ultimately disposed. It is not practicable to estimate the additional income taxes related to permanently reinvested earnings or the basis differences related to investments in subsidiaries.
(Loss) Income from Discontinued Operations, Net of Income Taxes
        Loss from discontinued operations was $410 million in fiscal 2007. During the third quarter of fiscal 2007, a plan was approved to divest our Power Systems business and, in connection with the approval, we recorded a $435 million after-tax, $585 million pre-tax, impairment charge. As discussed above, subsequent to year end, we entered into a definitive agreement to sell the Power Systems business. In the first quarter of fiscal 2007, we consummated the sale of the Printed Circuit Group business for $227 million in net cash proceeds and recorded a $45 million pre-tax gain on the sale.
        Income from discontinued operations was $13 million in fiscal 2006 and $122 million in fiscal 2005, reflecting the operating results of the Power Systems business as well as the Printed Circuit Board business that was approved for sale in fiscal 2006. As discussed above, this transaction was completed subsequent to fiscal year end 2006.
        See Note 5 to our Consolidated and Combined Financial Statements for further information regarding discontinued operations.
Cumulative Effect of Accounting Change
        During fiscal 2006, we adopted Financial Accounting Standards Board ("FASB") Interpretation No. ("FIN") 47, " Accounting for Conditional Asset Retirement Obligations—an interpretation of FASB
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No. 143 ." Accordingly, we have recognized asset retirement obligations of $16 million and property, plant, and equipment, net of $4 million in our Combined Financial Statements at fiscal year end 2006. In addition, we recorded a cumulative effect of accounting change which resulted in an $8 million after-tax, $12 million pre-tax, loss. See Note 2 to our Consolidated and Combined Financial Statements for more information on FIN 47.
        During fiscal 2005, we changed the measurement date for our pension and postretirement benefit plans from September 30th to August 31st, effective October 1, 2004. We believe that the one-month change of measurement date was a preferable change as it allows management adequate time to evaluate and report the actuarial information in our Consolidated and Combined Financial Statements under the accelerated reporting deadlines. As a result of this change, we recorded an $11 million after-tax, $13 million pre-tax, gain cumulative effect of accounting change in fiscal 2005. See Note 15 to our Consolidated and Combined Financial Statements for more information on retirement plans.
Change in Fiscal Year and Reporting Calendar Alignment
        Effective October 1, 2004, we changed our fiscal year end from a calendar fiscal year ending September 30th to a "52-53 week" year ending on the last Friday of September, so that each quarterly period would be 13 weeks in length. For fiscal years in which there are 53 weeks, the fourth quarter reporting period will be 14 weeks, with the first such occurrence taking place in fiscal 2011. The impact of this change was not material to the Combined Financial Statements. Net income for the transition period related to this change was $21 million after-tax, $29 million pre-tax, and was reported within equity.

 Liquidity and Capital Resources
        The following table summarizes the sources of our cash flow from operating activities and the use of a portion of that cash in our operations for fiscal 2007, 2006, and 2005:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Income from operations	 	$	753	 	$	1,448	 	$	2,007	 	
Allocated class action settlement costs, net	 	 	887	 	 	—	 	 	—	 	
Non-cash restructuring and other charges (credits), net	 	 	26	 	 	6	 	 	(16	)	
Gain on divestiture	 	 	—	 	 	—	 	 	(301	)	
Depreciation and amortization	 	 	535	 	 	484	 	 	490	 	
Goodwill impairment	 	 	—	 	 	316	 	 	—	 	
Deferred income taxes	 	 	162	 	 	(51	)	 	(54	)	
Provisions for losses on accounts receivable and inventory	 	 	84	 	 	70	 	 	75	 	
Other, net	 	 	(24	)	 	3	 	 	4	 	
Income tax advance payment	 	 	(163	)	 	—	 	 	—	 	
Changes in assets and liabilities, net	 	 	(50	)	 	(357	)	 	(34	)	
Interest income	 	 	53	 	 	48	 	 	44	 	
Interest expense	 	 	(231	)	 	(256	)	 	(293	)	
Income tax expense	 	 	(494	)	 	(46	)	 	(376	)	
 	 		 		 		 	
Net cash provided by operating activities	 	$	1,538	 	$	1,665	 	$	1,546	 	
 	 		 		 		 	
Other cash flow items:	 	 	 	 	 	 	 	 	 	 	
 	Capital expenditures	 	$	(892	)	$	(555	)	$	(476	)	
 	Divestiture of businesses	 	 	227	 	 	—	 	 	130	 	
        Net cash provided by operating activities in fiscal 2007 was $1,538 million compared to $1,665 million in fiscal 2006. Cash provided by operating activities was negatively impacted by a $163 million advance payment to the IRS related to shared tax liabilities. The net change in assets and liabilities was a cash decrease of $50 million. The components of this change are set forth in the
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Consolidated and Combined Statements of Cash Flows and include increases in inventory of $124 million offset by increases in accrued and other current liabilities of $105 million. Although overall inventory levels increased in fiscal 2007, we continued to make progress in reducing days of inventory on hand. Inventory days were 72 at September 28, 2007 compared to 75 at September 29, 2006. Increases in accrued and other current liabilities at fiscal year end 2007 resulted from our dividend payable and increased restructuring activity in fiscal 2007.
        We continue to fund capital expenditures to support new programs and to invest in machinery and our manufacturing facilities to further enhance productivity and manufacturing capabilities. Capital spending increased $337 million in fiscal 2007 to $892 million as compared to $555 million in fiscal 2006. During fiscal 2007, we exercised our option to buy five cable-laying sea vessels that were previously leased to us and used by the Undersea Telecommunications segment at a cost of $280 million, which was reflected as a capital expenditure. Capital spending in fiscal 2007 also increased to support our increased sales activities. We expect long-term capital investment levels of approximately 4% to 5% of net sales each year.
        In fiscal 2007, we received $227 million in net cash proceeds related to the sale of the Printed Circuit Group business. Also, during fiscal 2007, we funded our portion of the class action settlement escrow for $928 million. Related net class action settlement costs of $887 were recognized in fiscal 2007.
        The amount of pension and postretirement benefit contributions reflected in fiscal 2007, 2006, and 2005 were $71 million, $69 million, and $81 million, respectively. These amounts include voluntary pension contributions of $24 million in fiscal 2005. We anticipate pension contributions to be $70 million to $80 million per year on an ongoing basis before consideration of voluntary contributions.
        The amount of income taxes paid, net of refunds, during fiscal 2007 was $454 million, including the $163 million related to the advance payment to the IRS for legacy tax liabilities.
Capitalization
        Total debt at September 28, 2007 was $3,378 million. At fiscal year end 2006, total debt was $3,662 million of which $3,510 million was due to Tyco International. The amount due to Tyco International represents the portion of Tyco International's consolidated debt that was proportionately allocated to us based on our historical funding requirements. We believe the debt allocation basis was reasonable based on our historical financing needs. However, these amounts may not be indicative of the actual amounts that we would have incurred had we been operating as an independent, publicly-traded company nor do these amounts represent actual indebtedness owed to Tyco International.
        During September 2007, Tyco Electronics Group S.A. ("TEGSA"), a wholly-owned subsidiary of the Company, issued $800 million principal amount of its 6.00% senior notes due 2012, $750 million principal amount of its 6.55% senior notes due 2017, and $500 million principal amount of its 7.125% senior notes due 2037, all of which are fully and unconditionally guaranteed by us. TEGSA offered the senior notes in the U.S. to qualified institutional buyers pursuant to Rule 144A of the Securities Act. In addition, the initial purchasers, through their respective selling agents, sold less than one-half of one percent of the senior notes outside the U.S. pursuant to Regulation S under the Securities Act. In connection with the issuance of the senior notes, we and TEGSA entered into a registration rights agreement with the initial purchasers under which we and TEGSA agreed, for the benefit of the holders of the senior notes, to file with the SEC an exchange offer registration statement within 210 days after the date of the original issue of the notes. Net proceeds from the sales of the senior notes were used to repay a portion of borrowings under the unsecured senior bridge loan facility.
        In April 2007, TEGSA entered into a $2,800 million unsecured senior bridge loan facility. We are the guarantor of the bridge facility which had an original maturity date of April 23, 2008. On
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August 31, 2007, we and TEGSA amended the unsecured bridge loan facility to permit, at TEGSA's option, an extension of the maturity from April 23, 2008 to April 22, 2009. Borrowings under the bridge facility bear interest, at TEGSA's option, at a base rate or the London interbank offered rate ("LIBOR") plus a margin dependent on TEGSA's credit ratings and the amount drawn under the facility. TEGSA is required to pay an annual facility fee ranging from 4.5 to 12.5 basis points depending on its credit ratings. The bridge facility contains provisions that may require mandatory prepayments or reduction of unused commitments if we or TEGSA issue debt or equity. In May 2007, tranche B was added to the bridge facility, increasing the amount of the facility by $775 million. All balances under tranche B of the facility were paid off and all commitments under tranche B were cancelled in August 2007. Borrowings under the bridge facility were used to fund a portion of Tyco International's debt tender offers, to repay a portion of Tyco International's existing bank credit facilities, and to fund our portion of Tyco International's class action settlement escrow. See Note 16 to our Consolidated and Combined Financial Statements for further information regarding the class action settlement.
        Additionally, in April 2007, TEGSA entered into a five-year unsecured senior revolving credit facility. We are the guarantor of the revolving credit facility. The commitments under the revolving credit facility are $1,500 million. Interest and fees under the revolving credit facility are substantially the same as under the bridge loan facility. The revolving credit facility will be used for working capital, capital expenditures, and other corporate purposes.
        As of September 28, 2007, TEGSA had $700 million outstanding under the five-year unsecured senior revolving credit facility, which bore interest at the rate of 5.38%. Also, as of September 28, 2007, TEGSA had $550 million of indebtedness outstanding under the unsecured bridge loan facility, which bore interest at the rate of 5.47%.
        During the third quarter of fiscal 2007, we conducted a tender offer to purchase for cash our subsidiary's 7.2% notes due 2008 amounting to $86 million. Approximately $67 million, or 78%, of the notes were tendered and extinguished.
        Our debt agreements contain financial and other customary covenants. None of these covenants are presently considered restrictive to our operations. As of September 28, 2007, we were in compliance with all of our debt covenants.
        The September 2007 senior notes referred to above are subject to an exchange and registration rights agreement under which if certain registration requirements are not met by the required time or registration is withdrawn or is subject to an effective stop order, there may be a registration default, requiring payment by us of liquidated damages in the form of special interest at a rate of 0.25% per annum for the first 90 days of such registration default, and at a rate of 0.50% thereafter, until such registration default is cured. As of September 28, 2007, we have determined that the likelihood of a registration default is remote and have not accrued any special interest.
        In November 2007, TEGSA commenced issuing commercial paper to U.S. institutional accredited investors and qualified institutional buyers in accordance with available exemptions from the registration requirements of the Securities Act, as part of our ongoing effort to enhance financial flexibility and to potentially decrease the cost of borrowings. Borrowings under the commercial paper program are backed by the five-year senior unsecured revolving credit facility.
        In September 2007, our board of directors declared a regular quarterly cash dividend of $0.14 per common share. The dividend was paid on November 9, 2007. Future dividends to holders of our 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, statutory requirements of Bermuda law, contractual restrictions, and other factors that the board of directors may deem relevant.
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        In September 2007, our board of directors authorized a share repurchase program of $750 million to purchase a portion of our outstanding common shares. No common shares were repurchased under this program in fiscal 2007.
        Our ability to fund our capital needs will be affected by our ongoing ability to generate cash from operations, the overall capacity and terms of our financing arrangements as discussed above, and access to the capital and money markets as well as other sources of funding. Given the volatility in the financial markets, we continue to monitor the markets closely and take steps to maintain financial flexibility and an appropriate capital structure.
        On September 19, 2005, we were awarded a contract to build and operate the statewide private radio system for the State of New York. Under the contractual terms, this is a 20-year contract that requires us to build the network and lease it to the State. As we build the network over the next five years, we will need to invest approximately $500 to $550 million. As of September 28, 2007, we have invested $28 million, primarily consisting of inventory. We expect that in fiscal 2008 we will invest approximately $50 to $75 million which will be funded by cash generated from operations.

 Commitments and Contingencies
        The following table provides a summary of our contractual obligations and commitments for debt, minimum lease payments obligations under non-cancelable leases, and other obligations at fiscal year end 2007.

 	 	 	 	Payments due by fiscal year
	
 	 	Total
	 	2008
	 	2009
	 	2010
	 	2011
	 	2012
	 	There-
after
	
 	 	(in millions)
	
Debt (1)	 	$	3,378	 	$	555	 	$	20	 	$	1	 	$	1	 	$	1,500	 	$	1,301	
Operating leases	 	 	612	 	 	129	 	 	101	 	 	81	 	 	61	 	 	46	 	 	194	
Purchase obligations (2)	 	 	93	 	 	93	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
Total contractual cash obligations (3)	 	$	4,083	 	$	777	 	$	121	 	$	82	 	$	62	 	$	1,546	 	$	1,495	

(1)
Excludes interest.

(2)
Purchase obligations consist of commitments for purchases of goods and services.

(3)
Total contractual cash obligations in the table above exclude pension and postretirement benefit obligations, income taxes, and other long-term liabilities.

We have pension and postretirement benefit obligations to certain employees and former employees. We are obligated to make contributions to our pension plans and postretirement benefit plans; however, we are unable to determine the amount of plan contributions due to the inherent uncertainties of obligations of this type, including timing, interest rate charges, investment performance, and amounts of benefit payments. We expect to contribute $73 million to pension and postretirement benefit plans in fiscal 2008 and $70 million to $80 million per year on an ongoing basis, before consideration of voluntary contributions. These plans and our estimates of future contributions and benefit payments are more fully described in Note 15 to the Consolidated and Combined Financial Statements.

Income taxes and other long-term liabilities are excluded from the table above as we are unable to estimate the timing of payment for these items.
        At September 28, 2007, we had outstanding letters of credit and letters of guarantee in the amount of $277 million.
        At September 28, 2007, we had a contingent purchase price commitment of $80 million related to the fiscal 2001 acquisition of Com-Net by the Wireless Systems segment. This represents the maximum amount payable to the former shareholders of Com-Net only after the construction and installation of a communications system for the State of Florida is finished and the State has approved the system based on the guidelines set forth in the contract. A liability for this contingency has not been recorded in our
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Consolidated and Combined Financial Statements as the outcome of this contingency currently is not estimable.
Income Tax Matters
        Our income tax returns are periodically examined by various tax authorities. In connection with these examinations, tax authorities, including the IRS, have raised issues and proposed tax adjustments. We and Tyco International are reviewing and contesting certain of the proposed tax adjustments. Amounts related to these tax adjustments and other tax contingencies and related interest that management has assessed as probable and estimable and which relate specifically to the Tyco Electronics business have been recorded in our Consolidated and Combined Financial Statements. In addition, we may be required to pay additional taxes for contingencies not related to the electronics businesses as a result of the tax liability sharing arrangements with Tyco International and Covidien entered into upon Separation.
        In fiscal 2004, in connection with the IRS audit of the fiscal 1997 through 2000 years, Tyco International submitted to the IRS proposed adjustments to these prior period U.S. federal income tax returns resulting in a reduction in the taxable income previously filed. During fiscal 2006, the IRS accepted substantially all of the proposed adjustments. Also during fiscal 2006, Tyco International developed proposed amendments to U.S. federal income tax returns for additional periods through fiscal 2002. On the basis of previously accepted amendments, we have determined that acceptance of these adjustments is probable and, accordingly, have recorded them, as well as the impacts of the adjustments accepted by the IRS, in the Consolidated and Combined Financial Statements. These adjustments resulted in a $205 million net decrease in deferred income tax assets and a $205 million decrease in income taxes in fiscal 2006. Such adjustments did not have a material impact on our results of operations or cash flows.
        During the fourth quarter of fiscal 2007, Tyco International completed proposed amendments to a portion of its U.S. federal income tax returns for the 2001 through 2005 fiscal periods, which primarily reflected the roll forward of the previous amendments for the 1997 to 2002 fiscal periods. These adjustments resulted in a $9 million increase to the tax provision on our Consolidated and Combined Financial Statements in fiscal 2007. Tyco International continues to complete proposed adjustments to the remainder of its U.S. federal income tax returns for periods subsequent to fiscal 2002. When our tax return positions are updated, additional adjustments may be identified and recorded in the Consolidated Financial Statements. While the final adjustments cannot be determined until the income tax return amendment process is completed, we believe that any resulting adjustments will not have a material impact on our financial condition, results of operations, or cash flows.
        During the third quarter of fiscal 2007, the IRS concluded its field examination of certain of Tyco International's U.S. federal income tax returns for the years 1997 though 2000 and issued anticipated Revenue Agents' Reports which reflect the IRS' determination of proposed tax adjustments for the periods under audit. The Revenue Agents' Reports propose tax audit adjustments to certain of Tyco International's previously filed tax return positions, all of which Tyco International expected and previously assessed at each balance sheet date. Accordingly, we have made no additional provision during fiscal 2007 with respect to our share of the proposed audit adjustments in the Revenue Agents' Reports.
        Tyco International has agreed with the IRS on adjustments totaling $498 million, with an estimated cash impact to Tyco International of $458 million, and during the third quarter of fiscal 2007, Tyco International paid $458 million. Our portion of this payment reduced income taxes on the Consolidated Balance Sheet by $163 million. Currently, it is our understanding that Tyco International will appeal other proposed tax audit adjustments totaling approximately $1 billion and intends to vigorously defend its prior filed tax return positions. We continue to believe that the amounts recorded in our Consolidated and Combined Financial Statements relating to these tax adjustments are sufficient.
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However, the ultimate resolution of these matters is uncertain and could result in a material impact to our financial position, results of operations, or cash flows. In addition, ultimate resolution of these matters could result in Tyco International filing amended U.S. federal income tax returns for years subsequent to the current fiscal 1997 to 2000 audit period and could have a material impact on our effective tax rate in future reporting periods.
        Additionally, the IRS proposed civil fraud penalties against Tyco International arising from alleged actions of former executives in connection with certain intercompany transfers of stock in 1998 and 1999. Based on statutory guidelines, we estimate the proposed penalties could range between $30 million and $50 million. Any penalty imposed would be subject to sharing with Tyco International and Covidien under the Tax Sharing Agreement. Currently, it is our understanding that Tyco International will vigorously oppose the assertion of any such penalties.
        In connection with the Separation, we entered into a Tax Sharing Agreement that generally governs Covidien's, Tyco Electronics', and Tyco International's respective rights, responsibilities, and obligations after the distribution with respect to taxes, including ordinary course of business taxes and taxes, if any, incurred as a result of any failure of the distribution of all of the shares of Covidien or Tyco Electronics to qualify as a tax-free distribution for U.S. federal income tax purposes within the meaning of Section 355 of the Code or certain internal transactions undertaken in anticipation of the spin-offs to qualify for tax-favored treatment under the Code.
        Pursuant to the Separation and Distribution Agreement and Tax Sharing Agreement, upon Separation, we entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. Under these agreements, principally the Tax Sharing Agreement, Tyco International, Covidien, and Tyco Electronics share 27%, 42%, and 31%, respectively, of certain contingent liabilities relating to unresolved tax matters of legacy Tyco International. The effect of the Tax Sharing Agreement is to indemnify us for 69% of all liabilities settled by Tyco Electronics with respect to unresolved legacy tax matters. Pursuant to that indemnification, we have made similar indemnifications to Tyco International and Covidien with respect to 31% of all liabilities settled by the companies with respect to unresolved legacy tax matters. If any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, we would be responsible for a portion of the defaulting party or parties' obligation.
        Upon Separation, $930 million of Tyco International's contingent tax liabilities related to unresolved tax matters were transferred to us in accordance with the Tax Sharing Agreement. In addition, we recorded a receivable from Tyco International and Covidien of $675 million on the Consolidated Balance Sheet at June 29, 2007 relating to indemnifications made by Tyco International and Covidien under the Tax Sharing Agreement. During the fourth quarter of fiscal 2007, an analysis of the tax reserves held by the Company, Tyco International, and Covidien indicated that we are the primary obligor for an additional $161 million of tax and related interest for which reserves had been recorded on the books of Tyco International and Covidien. Accordingly, the amounts recorded by us upon Separation for contingent tax liabilities and the corresponding assets for indemnifications made by Tyco International and Covidien were increased to reflect these additional amounts. The initial liability at Separation and the adjustment made in the fourth quarter of fiscal 2007 were reflected as adjustments to contributed surplus on the Consolidated Balance Sheet.
        Our contractual obligation under the Tax Sharing Agreement is 31% of legacy Tyco International contingent tax liabilities, or $675 million. This net obligation is comprised of shared contingent tax liabilities of $1,223 million, adjusted for the contractual obligations among the parties to the Tax Sharing Agreement. These contractual obligations consist of a $844 million receivable from Tyco International and Covidien related to our shared contingent tax liabilities, a $198 million liability applicable to Tyco International and Covidien contingent tax liabilities, and a $98 million liability under FIN 45, " Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, " related to the estimated fair value of future indemnifications
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made under the Tax Sharing Agreement. See further discussion in Note 13 to the Consolidated and Combined Financial Statements. The actual amounts that we may be required to ultimately accrue or pay under this agreement could vary depending upon the outcome of the unresolved tax matters, which may not be resolved for several years. See Note 17 to the Consolidated and Combined Financial Statements for additional information regarding our responsibility for contingent tax liabilities.
Legal Matters
        In the ordinary course of business, we are subject to various legal proceedings and claims, including patent infringement claims, antitrust claims, product liability matters, environmental matters, employment disputes, disputes on agreements, and other commercial disputes. Management believes that these legal proceedings and claims likely will be resolved over an extended period of time. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information and applicable law, we do not expect that these proceedings will have a material adverse effect on our financial position. However, one or more of the proceedings could have a material adverse effect on our results of operations for a future period. See "Part I. Item 3. Legal Proceedings" and Note 16 to the Consolidated and Combined Financial Statements for further information regarding legal proceedings.
        Prior to the announcement of the planned separation in January 2006, Tyco International and certain former directors and officers were named as defendants in several lawsuits relating to securities class action, shareholder lawsuits, and ERISA related litigation. As a part of the Separation and Distribution Agreement, any existing or potential liabilities related to this outstanding litigation have been allocated among Tyco International, Covidien, and us. We are responsible for 31% of potential liabilities that may arise upon the settlement of the pending litigation. If Tyco International or Covidien were to default on their obligation to pay their allocated share of these liabilities, however, we would be required to pay additional amounts. Subject to the terms and conditions of the Separation and Distribution Agreement, Tyco International will manage and control all the legal matters related to assumed contingent liabilities, including the defense or settlement thereof, subject to certain limitations. The liability sharing provisions regarding these class actions are set forth in the Separation and Distribution Agreement among Tyco International, Tyco Electronics, and Covidien.

 Off-Balance Sheet Arrangements
        Certain of our segments have guaranteed the performance of third-parties and provided financial guarantees for uncompleted work and financial commitments. The terms of these guarantees vary with end dates ranging from fiscal 2007 through the completion of such transactions. The guarantees would be triggered in the event of nonperformance and the potential exposure for nonperformance under the guarantees would not have a material effect on our financial position, results of operations, or cash flows.
        In disposing of assets or businesses, we often provide representations, warranties, and/or indemnities to cover various risks including unknown damage to the assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not have the ability to estimate the potential liability from such indemnities because they relate to unknown conditions. However, we have no reason to believe that these uncertainties would have a material adverse effect on our financial position, results of operations, or cash flows.
        We have recorded liabilities for known indemnifications included as part of environmental liabilities. See Note 16 Consolidated and Combined Financial Statements for a discussion of these liabilities.
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        At September 29, 2006, we had an off-balance sheet leasing arrangement for five cable laying sea vessels. Upon expiration of this lease in October 2006, we exercised our option to buy these vessels for $280 million and, accordingly, the residual guarantee of $54 million was settled.
        In the normal course of business, we are liable for contract completion and product performance. In the opinion of management, such obligations will not significantly affect our financial position, results of operations, or cash flows.
        Pursuant to the Separation and Distribution Agreement and Tax Sharing Agreement, upon Separation, we entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. Under these agreements, principally the Tax Sharing Agreement, Tyco International, Covidien, and Tyco Electronics share 27%, 42%, and 31%, respectively, of certain contingent liabilities relating to unresolved tax matters of legacy Tyco International. The effect of the Tax Sharing Agreement is to indemnify us for 69% of all liabilities settled by us with respect to unresolved legacy tax matters. Pursuant to that indemnification, we have made similar indemnifications to Tyco International and Covidien with respect to 31% of all liabilities settled by the companies with respect to unresolved legacy tax matters. If any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, we would be responsible for a portion of the defaulting party or parties' obligation. These arrangements have been valued upon our separation from Tyco International with the assistance of a third-party valuation firm in accordance with FIN 45, " Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others ," and, accordingly, liabilities amounting to $98 million were recorded on the Consolidated Balance Sheet at September 28, 2007. See Notes 13 and 17 to the Consolidated and Combined Financial Statements for additional information.
        We record estimated product warranty costs at the time of sale. See Note 13 to the Consolidated and Combined Financial Statements for further information regarding estimated product warranty.

 Critical Accounting Policies and Estimates
        The preparation of the Consolidated and Combined Financial Statements in conformity with GAAP requires management to use judgment in making estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenue and expenses. Our significant accounting policies are summarized in Note 2 to our Consolidated and Combined Financial Statements. The following noted accounting policies are based on, among other things, judgments and assumptions made by management that include inherent risks and uncertainties. Management's estimates are based on the relevant information available at the end of each period.
Revenue Recognition
        Our revenue recognition policies are in accordance with Staff Accounting Bulletin ("SAB") No. 101, " Revenue Recognition in Financial Statements, " and SAB No. 104, " Revenue Recognition ," as issued by the SEC and other applicable guidance.
        Our revenues are generated principally from the sale of our products. Revenue from the sales of products is recognized at the time title and the risks and rewards of ownership pass. This time is generally when the products reach the free-on-board shipping point, the sales price is fixed and determinable, and collection is reasonably assured. For those items where title has not yet transferred, we have deferred the recognition of revenue. A reserve for estimated returns is established at the time of sale based on historical return experience and is recorded as a reduction of sales. Other allowances include customer quantity and price discrepancies. A reserve for other allowances is established at the time of sale based on historical experience and is recorded as a reduction of sales.
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        Contract sales for construction related projects are recorded primarily on the percentage-of-completion method. Profits recognized on contracts in process are based upon estimated contract revenue and related cost to completion. Cost to completion is measured based on the ratio of actual cost incurred to total estimated cost. Revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the current period. Provisions for anticipated losses are made in the period in which they first become determinable. Contract sales for construction related projects are generated primarily within our Wireless Systems and Undersea Telecommunications segments.
Inventories
        Inventories are stated at the lower of cost or market value. Provisions for slow moving and obsolete inventory are made based upon product demand and historical experience. Should future product demand change, existing inventory could become slow moving or obsolete and provisions would be increased accordingly.
Goodwill and Other Intangible Assets
        Intangible assets acquired include both those that have a determinable life and residual goodwill. Intangible assets with a determinable life include primarily intellectual property consisting of patents, trademarks, and unpatented technology with estimates of recoverability ranging from 3 to 50 years that are amortized on a straight-line basis. An evaluation of the remaining useful life of intangible assets with a determinable life is performed on a periodic basis when events and circumstances warrant an evaluation. We assess intangible assets with a determinable life for impairment consistent with our policy for assessing other long-lived assets. Goodwill is assessed for impairment separately from other intangible assets with a determinable life by comparing the carrying value of each reporting unit to its fair value on the first day of the fourth quarter of each year or whenever we believe a triggering event requiring a more frequent assessment has occurred. In making this assessment, management relies on a number of factors including operating results, business plans, economic projections, anticipated future cash flows, transactions, and market place data. There are inherent uncertainties related to these factors, and management's judgment in applying them to the analysis of goodwill impairment. Since management's judgment is involved in performing goodwill valuation analyses, there is risk that the carrying value of our goodwill may be overstated or understated.
        When testing for goodwill impairment, we follow the guidance prescribed in SFAS No. 142, " Goodwill and Other Intangible Assets ." First, we perform a step I goodwill impairment test to identify a potential impairment. In doing so, we compare the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, goodwill may be impaired and a step II goodwill impairment test is performed to measure the amount of any impairment loss. In the step II goodwill impairment test, we compare the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner that the amount of goodwill recognized in a business combination is determined. We allocate the fair value of a reporting unit to all of the assets and liabilities of that unit, including intangible assets, as if the reporting unit had been acquired in a business combination. Any excess of the value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill.
        Estimates about fair value used in the step I goodwill impairment tests have been calculated using an income approach based on the present value of future cash flows of each reporting unit. The income approach has been supported by additional transaction and guideline analysis. These approaches incorporate many assumptions including future growth rates, discount factors, and income tax rates in assessing fair value. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairments in future periods.
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Income Taxes
        In determining income for financial statement purposes, we must make certain estimates and judgments. These estimates and judgments affect the calculation of certain tax liabilities and the determination of the recoverability of certain of the deferred tax assets, which arise from temporary differences between the tax and financial statement recognition of revenue and expense.
        In evaluating our ability to recover our deferred tax assets, we consider all available positive and negative evidence including our past operating results, the existence of cumulative losses in the most recent years, and our forecast of future taxable income. In estimating future taxable income, we develop assumptions including the amount of future state, federal, and international pretax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates we are using to manage the underlying businesses.
        We currently have recorded significant valuation allowances that we intend to maintain until it is more likely than not the deferred tax assets will be realized. Our income tax expense recorded in the future will be reduced to the extent of decreases in our valuation allowances. The realization of our remaining deferred tax assets is primarily dependent on future taxable income in the appropriate jurisdiction. Any reduction in future taxable income including any future restructuring activities may require that we record an additional valuation allowance against our deferred tax assets. An increase in the valuation allowance would result in additional income tax expense in such period and could have a significant impact on our future earnings. If a change in a valuation allowance occurs, which was established in connection with an acquisition, the adjustment of such allowance may affect goodwill rather than the income tax provision.
        Changes in tax laws and rates also could affect recorded deferred tax assets and liabilities in the future. Management is not aware of any such changes that would have a material effect on our results of operations, cash flows, or financial position.
        In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We recognize potential liabilities and record tax liabilities as well as related interest for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether, and the extent to which, additional taxes and related interest will be due. These tax liabilities and related interest are reflected net of the impact of related tax loss carryforwards, as such tax loss carryforwards will be applied against these tax liabilities and will reduce the amount of cash tax payments due upon the eventual settlement with the tax authorities. We adjust these liabilities in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the tax liabilities. Further, management has reviewed with tax counsel the issues raised by these taxing authorities and the adequacy of these recorded amounts. If our estimate of tax liabilities proves to be less than the ultimate assessment, an additional charge to expense would result. If payment of these amounts ultimately proves to be less than the recorded amounts, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary. Substantially all of these potential tax liabilities are recorded in income taxes on the Consolidated and Combined Balance Sheet as payment is not expected within one year.
Pension and Postretirement Benefit
        Our pension expense and obligations are developed from actuarial valuations. Two critical assumptions in determining pension expense and obligations are the discount rate and expected long-term return on plan assets. We evaluate these assumptions at least annually. Other assumptions reflect demographic factors such as retirement, mortality, and turnover and are evaluated periodically
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and updated to reflect our actual experience. Actual results may differ from actuarial assumptions. The discount rate represents the market rate for high-quality fixed income investments and is used to calculate the present value of the expected future cash flows for benefit obligations to be paid under our pension plans. A decrease in the discount rate increases the present value of pension benefit obligations. A 25 basis point decrease in the discount rate would increase our present value of pension obligations by $106.3 million, while a 25 basis point increase in the discount rate would decrease our present value of pension obligations by $101.6 million. We consider the current and expected asset allocations of our pension plans, as well as historical and expected long-term rates of return on those types of plan assets, in determining the expected long-term rate of return on plan assets. A 50 basis point decrease in the expected long-term return on plan assets would increase our pension expense by $9.8 million, while a 50 basis point increase in the expected long-term return on plan assets would decrease our pension expense by $9.8 million.
Share-Based Compensation
        We adopted SFAS No. 123R, " Share-Based Payment ," on October 1, 2005 using the modified prospective transition method. Under SFAS No. 123R, we determine the fair value of share awards on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires certain assumptions that involve judgment. Such assumptions are the expected stock price volatility, expected annual dividend yield, expected life of options, and risk-free interest rate. (See Note 23 to the Consolidated and Combined Financial Statements for additional information related to share-based compensation.) An increase in the volatility of the Company's stock will increase the amount of compensation expense on new awards. An increase in the holding period of options will also cause an increase in compensation expense. Dividend yields and risk-free interest rates are less difficult to estimate, but an increase in the dividend yield will cause a decrease in expense and an increase in the risk-free interest rate will increase compensation expense.

 Accounting Pronouncements
Recently Adopted Accounting Pronouncements
        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 No. 158 requires that employers recognize the funded status of defined benefit pension and other postretirement benefit plans as a net asset or liability on the balance sheet and recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise during the period but are not recognized as a component of net periodic benefit cost. Under SFAS No. 158, companies are required to measure plan assets and benefit obligations as of their fiscal year end. We currently use a measurement date of August 31st. SFAS No. 158 also requires additional disclosure in the notes to the financial statements. The measurement date provisions will become effective for us in fiscal 2009. We are currently assessing the impact of the measurement date change provision on our results of operations, financial position, or cash flows. We adopted the funded status recognition provisions at September 28, 2007. The incremental effects of adopting the standard on the Consolidated Balance Sheet are increases of $386 million in long-term pension and postretirement benefit liabilities, $16 million in accrued and other current liabilities, and $55 million in other assets. The impact of adoption also resulted in additional net deferred tax assets of $122 million. The impact of adoption to accumulated other comprehensive income, a component of equity, was a reduction of $225 million. There was no impact on pension or other postretirement benefit expense, cash flows, or benefits plans in fiscal 2007. On-going compliance with the standard will not impact pension or other postretirement benefit expense, cash flows, or benefit plans. See Note 15 to the Consolidated and Combined Financial Statements for further discussion of the implementation of the recognition provisions of SFAS No. 158.
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        In September 2006, the SEC issued SAB No. 108, " Considering the Effect of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements ." SAB No. 108 provides guidance on evaluating the materiality of prior periods' misstatements, quantifying the effects of correcting misstatements in the current period and criteria for restatement of prior periods. SAB No. 108 is effective for fiscal years ending after November 15, 2006. We adopted this guidance effective for fiscal 2007. This adoption did not have a material impact on our results of operations, financial position, or cash flows.
Recently Issued Accounting Pronouncements
        In December 2007, the FASB issued SFAS No. 141R, " Business Combinations ." SFAS No. 141R replaces SFAS No. 141 and addresses the recognition and accounting for identifiable assets acquired, liabilities assumed, and noncontrolling interests in business combinations. SFAS No. 141R is effective for us in the first quarter of fiscal 2010. We are currently assessing the impact that SFAS No. 141R will have on our results of operations, financial position, or cash flows.
        In December 2007, the FASB issued SFAS No. 160, " Noncontrolling Interests in Consolidated Financial Statements ." SFAS No. 160 addresses the accounting and reporting framework for minority interests by a parent company. SFAS No. 160 is effective for us in the first quarter of fiscal 2010. We are currently assessing the impact that SFAS No. 160 will have on our results of operations, financial position, or cash flows.
        In June 2007, the FASB Emerging Issues Task Force issued EITF Issue No. 06-11, " Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards ." EITF 06-11 requires that a realized income tax benefit from dividends or dividend equivalent units paid on unvested restricted shares and restricted share units be reflected as an increase in contributed surplus and reflected as an addition to our excess tax benefit pool, as defined under SFAS No. 123R. EITF 06-11 is effective for us in the first quarter of fiscal 2009. We are currently assessing the impact that EITF 06-11 will have on our results of operations, financial position, or cash flows.
        In February 2007, the FASB issued SFAS No. 159, " The Fair Value Option for Financial Assets and Financial Liabilities ." SFAS No. 159 permits an entity, on a contract-by-contract basis, to make an irrevocable election to account for certain types of financial instruments and warranty and insurance contracts at fair value, rather than historical cost, with changes in the fair value, whether realized or unrealized, recognized in earnings. SFAS No. 159 is effective for us in the first quarter of fiscal 2009. We are currently assessing the impact that SFAS No. 159 will have on our results of operations, financial position, or cash flows.
        In September 2006, the FASB issued SFAS No. 157, " Fair Value Measurements. " SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosure about fair value measurements. SFAS No. 157 is effective for us in the first quarter of fiscal 2009. We are currently assessing the impact, if any, that SFAS No. 157 will have on our results of operations or financial position.
        In June 2006, the FASB issued FIN 48, " Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109 ." This interpretation prescribes a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. FIN 48 and related interpretations are effective for us in the first quarter of fiscal 2008. The cumulative effect of adoption will be recorded as an adjustment to the opening balance of retained earnings for fiscal 2008. We are currently assessing the expected impact of adopting FIN 48. Based upon our evaluation to date, we estimate that the adjustment to the opening balance of retained earnings will be $100 to $200 million. This adjustment includes an estimated net increase in contingent liabilities upon adoption of FIN 48 of $300 to $400 million, excluding interest, reduced by the portion of these contingent liabilities for which Tyco International and Covidien are contractually obligated under the terms of our Tax Sharing Agreement. See Note 17 to the Consolidated and Combined Financial Statements for additional information regarding responsibilities for unresolved legacy tax matters.
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 Forward-Looking Information
        Certain statements in this report are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on our management's beliefs and assumptions and on information currently available to our management. Forward-looking statements include, among others, the information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition, and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," "plan," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "should," or the negative of these terms or similar expressions.
        Forward-looking statements involve risks, uncertainties, and assumptions. Actual results may differ materially from those expressed in these forward-looking statements. You should not put undue reliance on any forward-looking statements. We do not have any intention or obligation to update forward-looking statements after we file this report except as required by law.
        Among the risks that could cause our results to differ materially from those expressed in forward-looking statements are the risks described in "Part I. Item 1A. Risk Factors." There may be other risks and uncertainties that we are unable to predict at this time or that we currently do not expect to have a material adverse effect on our business.

 ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
        In the normal course of business, our financial position is routinely subject to a variety of risks, including market risks associated with interest rate and currency movements on outstanding debt and non-U.S. dollar denominated assets and liabilities. We utilize established risk management policies and procedures in executing derivative financial instrument transactions to manage a portion of these risks.
        We do not execute transactions or hold derivative financial instruments for trading or speculative purposes. Counterparties to derivative financial instruments are limited to major financial institutions with at least an A/A2 long-term debt rating. There is no significant concentration of exposures with any one counterparty.
Foreign Currency Exposures
        As part of managing the exposure to changes in foreign currency exchange rates, we use foreign exchange forwards and swaps. The objective is to manage our foreign currency exposures on intercompany transactions, accounts receivable, accounts payable, and forecasted transactions denominated in certain foreign currencies. A 10% appreciation of the U.S. dollar from the September 28, 2007 market rates would increase the unrealized value of our forward contracts by $59 million, while a 10% depreciation of the U.S. dollar would decrease the unrealized value of our forward contracts by $72 million. A 10% appreciation of the U.S. dollar from the September 29, 2006 market rates would increase the unrealized value of our forward contracts by $6 million, while a 10% depreciation of the U.S. dollar would decrease the unrealized value of our forward contracts by $8 million. However, such gains or losses on these contracts would be generally offset by the gains or losses on the revaluation or settlement of the underlying transactions.
Interest Rate Exposures
        We issue debt, from time to time, in capital markets to fund our operations. Such borrowings can result in interest rate and/or currency exposure. To manage these exposures and to minimize overall interest cost, we have used and may use in the future interest rate swaps to convert a portion of the
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fixed-rate debt into variable rate debt (fair value hedges) and/or convert a portion of the variable rate debt into fixed-rate debt (cash flow hedges). At September 28, 2007, we had no outstanding interest rate swaps. Based on our floating rate debt balance of $1,250 million at September 28, 2007, an increase in the levels of the U.S. dollar interest rates by 0.5%, with all other variables held constant, would result in an increase of annual interest expense of approximately $6 million.
        See Note 14 to the Consolidated and Combined Financial Statements for additional information on financial instruments.

 ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
        The following Consolidated and Combined Financial Statements and schedule specified by this Item, together with the report thereon of Deloitte & Touche LLP, are presented following Item 15 and the signature pages of this report:
        Financial Statements:
Report of Independent Registered Public Accounting Firm
Consolidated and Combined Statements of Operations for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
Consolidated and Combined Balance Sheets at September 28, 2007 and September 29, 2006
Consolidated and Combined Statements of Equity for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
Consolidated and Combined Statements of Cash Flows for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
Notes to Consolidated and Combined Financial Statements
        Financial Statement Schedule:
Schedule II—Valuation and Qualifying Accounts
        All other financial statements and schedules have been omitted since the information required to be submitted has been included in the Consolidated and Combined Financial Statements and related notes or because they are either not applicable or not required under the rules of Regulation S-X.

 ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
        None.

 ITEM 9A.    CONTROLS AND PROCEDURES
        This Annual Report does not include a report of management's assessment regarding internal control over financial reporting or an attestation report of the Company's registered public accounting firm due to a transition period established by rules of the SEC for newly public companies. Under the rules and regulations of the SEC, we are not required to comply with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 until we file our Annual Report on Form 10-K for our fiscal year ending September 26, 2008, so long as we continue to meet the definition of a non-accelerated filer. In our Annual Report on Form 10-K for the fiscal year ending September 26, 2008, management and our independent registered public accounting firm will be required to provide an assessment as to the effectiveness of our internal control over financial reporting.
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        Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of September 28, 2007. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
        In our information statement filed as Exhibit 99.1 to our Current Report on Form 8-K on June 8, 2007, we disclosed a material weakness in our internal control over financial reporting relating to accounting for income taxes. As a result of this material weakness, which was not remediated as of September 28, 2007, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective as of September 28, 2007.
        We are continuing to build our tax accounting resources and capabilities to remediate this material weakness, and are implementing new control processes and procedures as part of our efforts to become compliant with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002. Although we have taken several steps to strengthen controls, we continue to develop improvements to our control processes, including:
•
enhancing policies and procedures relating to tax account reconciliation and analysis;

•
augmenting tax accounting resources and ensuring adequate training;

•
reinforcing requirements for tax jurisdiction specific information with internal information providers; and

•
further integrating tax processes with the Company's information systems.

 ITEM 9B.    OTHER INFORMATION
        None.
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 PART III
ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
        Information concerning directors, executive officers and corporate governance may be found under the captions "Proposal Number One: Election of Directors," "Nominees for Election," "Corporate Governance," "The Board of Directors and Board Committees," and "Executive Officers" in our definitive proxy statement for our 2008 Annual General Meeting of Shareholders (the "2008 Proxy Statement"), which will be filed with the SEC within 120 days after the close of our fiscal year. Such information is incorporated herein by reference. The information in the 2008 Proxy Statement set forth under the caption "Section 16(a) Beneficial Ownership Reporting Compliance" is incorporated herein by reference.
Code of Ethics
        We have adopted the Tyco Electronics Guide to Ethical Conduct, which applies to all employees, officers, and directors of Tyco Electronics. Our Guide to Ethical Conduct meets the requirements of a "code of ethics" as defined by Item 406 of Regulation S-K and applies to our chief executive officer, chief financial officer, and chief accounting officer, as well as all other employees and directors, as indicated above. Our Guide to Ethical Conduct also meets the requirements of a code of business conduct and ethics under the listing standards of the NYSE. Our Guide to Ethical Conduct is posted on our website at www.tycoelectronics.com under the heading "Who We Are—Quick Links—Guide to Ethical Conduct." We also will provide a copy of our Guide to Ethical Conduct to shareholders upon request. We intend to disclose any amendments to our Guide to Ethical Conduct, as well as any waivers for executive officers or directors, on our website.

 ITEM 11.    EXECUTIVE COMPENSATION
        Information concerning executive compensation may be found under the captions "Compensation Discussion and Analysis," "Management Development and Compensation Committee Report," "Executive Officer Compensation," "Compensation of Non-Employee Directors," and "Compensation Committee Interlocks and Insider Participation" in our 2008 Proxy Statement. Such information is incorporated herein by reference.

 ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
        The information in our 2008 Proxy Statement set forth under the caption "Security Ownership of Certain Beneficial Owners, Directors and Executive Officers" is incorporated herein by reference. See "Part II. Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Equity Compensation Plan Information" for information about securities authorized for issuance under equity compensation plans.

 ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
        The information in our 2008 Proxy Statement set forth under the captions "Corporate Governance," "The Board of Directors and Board Committees," and "Certain Relationships and Related Transactions" is incorporated herein by reference.

 ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES
        The information in our 2008 Proxy Statement set forth under the captions "Proposal Number Two: Appointment of Independent Auditor and Authorization of Audit Committee to Set Remuneration of Independent Auditor," "Fees Paid to Independent Auditor," and "Policy for the Pre-Approval of Audit and Non-Audit Services" is incorporated herein by reference.
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 PART IV
ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)
1.     Financial Statements. See Item 8.

2.
Financial Statement Schedules. See Item 8.

3.
Exhibit Index:

Exhibit
Number
	 	Description

2.1	
 	
Separation and Distribution Agreement among Tyco International Ltd., Covidien Ltd. and Tyco Electronics Ltd., dated as of June 29, 2007 (Incorporated by reference to Exhibit 2.1 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

3.1	
 	
Memorandum of Association of Tyco Electronics Ltd. (Incorporated by reference to Exhibit 3.1 to Amendment No. 3 to Tyco Electronics' Registration Statement on Form 10, filed June 5, 2007)	

3.2	
 	
Certificate of Incorporation of Tyco Electronics Ltd. (Incorporated by reference to Exhibit 3.2 to Tyco Electronics' Registration Statement on Form 10, filed January 18, 2007)	

3.3	
 	
Amended and Restated Bye-Laws of Tyco Electronics Ltd. (Incorporated by reference to Exhibit 3.1 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

4.1	
(a)	
Indenture among Tyco Electronics Group S.A., Tyco Electronics Ltd. and Deutsche Bank Trust Company Americas, as trustee, dated as of September 25, 2007*	

4.1	
(b)	
First Supplemental Indenture among Tyco Electronics Group S.A., Tyco Electronics Ltd. and Deutsche Bank Trust Company Americas, as trustee, dated as of September 25, 2007*	

4.1	
(c)	
Second Supplemental Indenture among Tyco Electronics Group S.A., Tyco Electronics Ltd. and Deutsche Bank Trust Company Americas, as trustee, dated as of September 25, 2007*	

4.1	
(d)	
Third Supplemental Indenture among Tyco Electronics Group S.A., Tyco Electronics Ltd. and Deutsche Bank Trust Company Americas, as trustee, dated as of September 25, 2007*	

4.2	
 	
Exchange and Registration Rights Agreement among Tyco Electronics Group S.A., Tyco Electronics Ltd. and Goldman, Sachs & Co. and UBS Securities LLC, as representatives of the purchasers, dated as of September 25, 2007*	

10.1	
 	
Tax Sharing Agreement among Tyco International Ltd., Covidien Ltd. and Tyco Electronics Ltd., dated as of June 29, 2007 (Incorporated by reference to Exhibit 10.1 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

10.2	
 	
364-Day Senior Bridge Loan Agreement among Tyco International Ltd., Tyco International Group S.A., Tyco Electronics Group S.A., Tyco Electronics Ltd., the lenders party thereto and Bank of America, N.A., as administrative agent, dated as of April 25, 2007 (Incorporated by reference to Exhibit 10.2 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

10.3	
 	
Amendment No. 1 to 364-Day Senior Bridge Loan Agreement among Tyco International Ltd., Tyco International Group S.A., Tyco Electronics Group S.A., Tyco Electronics Ltd., the lenders party thereto and Bank of America, N.A., as administrative agent, dated as of May 25, 2007 (Incorporated by reference to Exhibit 10.3 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

73

10.4	
 	
Guarantor Assumption Agreement between Tyco International Ltd. and Tyco Electronics Ltd., dated as of June 29, 2007 (Incorporated by reference to Exhibit 10.5 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

10.5	
 	
Amendment No. 2 to 364-Day Senior Bridge Loan Agreement among Tyco Electronics Group S.A., Tyco Electronics Ltd., the lenders party thereto and Bank of America, N.A., as administrative agent, dated as of August 31, 2007 (Incorporated by reference to Exhibit 10.1 to Tyco Electronics' Current Report on Form 8-K, filed August 31, 2007)	

10.6	
 	
Five-Year Senior Credit Agreement among Tyco International Ltd., Tyco Electronics Group S.A., Tyco Electronics Ltd., the lenders party thereto and Bank of America, N.A., as administrative agent, dated as of April 25, 2007 (Incorporated by reference to Exhibit 10.4 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

10.7	
 	
Guarantor Assumption Agreement between Tyco International Ltd. and Tyco Electronics Ltd., dated as of June 29, 2007 (Incorporated by reference to Exhibit 10.6 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

10.8	
 	
Tyco Electronics Ltd. 2007 Stock and Incentive Plan (Incorporated by reference to Exhibit 10.1 to Tyco Electronics' Registration Statement on Form S-8, filed July 5, 2007)‡	

10.9	
 	
Tyco Electronics Ltd. Employee Stock Purchase Plan (Incorporated by reference to Exhibit 10.2 to Tyco Electronics' Registration Statement on Form S-8, filed July 5, 2007)‡	

10.10	
 	
Form of Founders' Grant Option Award Terms and Conditions (Incorporated by reference to Exhibit 10.7 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)‡	

10.11	
 	
Form of Option Award Terms and Conditions‡*	

10.12	
 	
Form of Founders' Grant Restricted Unit Award Terms and Conditions (Incorporated by reference to Exhibit 10.8 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)‡	

10.13	
 	
Form of Restricted Unit Award Terms and Conditions‡*	

10.14	
 	
Tyco Electronics Ltd. Change in Control Severance Plan for Certain U.S. Officers and Executives (Incorporated by reference to Exhibit 10.2 to Tyco Electronics' Current Report on Form 8-K, filed November 9, 2007)‡	

10.15	
 	
Tyco Electronics Ltd. Severance Plan for U.S. Officers and Executives (Incorporated by reference to Exhibit 10.1 to Tyco Electronics' Current Report on Form 8-K, filed November 9, 2007)‡	

10.16	
 	
Tyco Electronics Ltd. Deferred Compensation Plan for Directors‡*	

10.17	
 	
Tyco Electronics Corporation Supplemental Savings and Retirement Plan (Incorporated by reference to Exhibit 10.3 to Tyco Electronics' Current Report on Form 8-K, filed November 9, 2007)‡	

10.18	
 	
Employment Agreement between Tyco Electronics Logistics AG and Juergen Gromer, dated as of October 1, 1999 (Incorporated by reference to Exhibit 10.3 to Amendment No. 3 to Tyco Electronics' Registration Statement on Form 10, filed June 5, 2007)‡	

10.19	
 	
Retention Agreement between Tyco Electronics Ltd. and Juergen Gromer, dated March 22, 2006 (Incorporated by reference to Exhibit 10.5 to Tyco Electronics' Registration Statement on Form 10, filed January 18, 2007)‡	
 	 	 	
74

10.20	
 	
Settlement Agreement between Tyco Electronics AMP GmbH, Tyco Electronics Logistics AG, Tyco International Ltd. and Juergen Gromer, dated April 10, 2007 (Incorporated by reference to Exhibit 10.9 to Amendment No. 1 to Tyco Electronics' Registration Statement on Form 10, filed April 20, 2007)‡	

10.21	
 	
Employment Agreement between Tyco Electronics Ltd. and Terrence Curtin, dated November 14, 2006 (Incorporated by reference to Exhibit 10.5 to Amendment No. 3 to Tyco Electronics' Registration Statement on Form 10, filed June 5, 2007) ‡	

10.22	
 	
Retention Agreement between Tyco Electronics Ltd. and Terrence Curtin, dated May 26, 2006 (Incorporated by reference to Exhibit 10.6 to Amendment No. 3 to Tyco Electronics' Registration Statement on Form 10, filed June 5, 2007)‡	

10.23	
 	
Tyco Electronics Ltd. UK Savings Related Share Plan‡*	

10.24	
 	
Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.9 to Tyco Electronics' Current Report on Form 8-K, filed July 5, 2007)	

21.1	
 	
Subsidiaries of Tyco Electronics Ltd.*	

23.1	
 	
Consent of Independent Registered Public Accounting Firm*	

24.1	
 	
Power of Attorney*	

31.1	
 	
Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*	

31.2	
 	
Certification by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*	

32.1	
 	
Certification by the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*	

*
Filed herewith

‡
Management contract or compensatory plan or arrangement.

(b)
See Item 15(a)3. above.

(c)
See Item 15(a)2. above.
75

 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.

 	 	TYCO ELECTRONICS LTD.	

 	
By:	
/s/   TERRENCE R. CURTIN       

Terrence R. Curtin
 Executive Vice President
and Chief Financial Officer
(Principal Financial Officer)	
        Date: December 14, 2007
        Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature
	 	Title
	 	Date

 	

 	
 	
/s/   THOMAS J. LYNCH       

Thomas J. Lynch	 	Chief Executive Officer and Director
(Principal Executive Officer)	 	December 14, 2007	

/s/   TERRENCE R. CURTIN       

Terrence R. Curtin	
 	
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)	
 	
December 14, 2007	

/s/   ROBERT J. OTT       

Robert J. Ott	
 	
Senior Vice President and Corporate Controller
(Principal Accounting Officer)	
 	
December 14, 2007	

*

Pierre R. Brondeau	
 	
Director	
 	
December 14, 2007	

*

Ram Charan	
 	
Director	
 	
December 14, 2007	

*

Juergen W. Gromer	
 	
Director	
 	
December 14, 2007	

*

Robert M. Hernandez	
 	
Director	
 	
December 14, 2007	
76

Signature
	 	Title
	 	Date

 	

 	
 	
*

Daniel J. Phelan	 	Director	 	December 14, 2007	

*

Frederic M. Poses	
 	
Director	
 	
December 14, 2007	

*

Lawrence S. Smith	
 	
Director	
 	
December 14, 2007	

*

Paula A. Sneed	
 	
Director	
 	
December 14, 2007	

*

David P. Steiner	
 	
Director	
 	
December 14, 2007	

*

Sandra S. Wijnberg	
 	
Director	
 	
December 14, 2007	
*
Robert A. Scott, by signing his name hereto, does sign this document on behalf of the above noted individuals, pursuant to powers of attorney duly executed by such individuals, which have been filed as Exhibit 24.1 to this Report.

 	 	By:	/s/   ROBERT A. SCOTT       
	
 	 	 	Robert A. Scott
 Attorney-in-fact	
77

 TYCO ELECTRONICS LTD.

INDEX TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

 	 	Page
	
Report of Independent Registered Public Accounting Firm	 	79	

Consolidated and Combined Statements of Operations for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005	
 	
81	

Consolidated and Combined Balance Sheets as of September 28, 2007 and September 29, 2006	
 	
82	

Consolidated and Combined Statements of Equity for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005	
 	
83	

Consolidated and Combined Statements of Cash Flows for the Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005	
 	
84	

Notes to Consolidated and Combined Financial Statements	
 	
85	

Schedule II—Valuation and Qualifying Accounts	
 	
150	
78

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Tyco Electronics Ltd. Board of Directors:
        We have audited the accompanying consolidated and combined balance sheets of Tyco Electronics Ltd. and subsidiaries (the "Company") as of September 28, 2007 and September 29, 2006 and the related consolidated and combined statements of operations, equity and cash flows for each of the three fiscal years in the period ended September 28, 2007. Our audits also included the financial statement schedule listed in the Index at Item 15. These consolidated and combined financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated and combined financial statements and financial statement schedule based on our 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 audit to obtain reasonable assurance about whether the consolidated and combined financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes 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, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
        In our opinion, such consolidated and combined financial statements present fairly, in all material respects, the consolidated and combined financial position of the Company as of September 28, 2007 and September 29, 2006, and the results of its operations and its cash flows for each of the three fiscal years in the period ended September 28, 2007, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated and combined financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
        As discussed in Note 1 to the consolidated and combined financial statements, prior to its separation from Tyco International Ltd. ("Tyco International"), the Company was comprised of the assets and liabilities used in managing and operating the electronics businesses of Tyco International. The combined financial statements also included allocations of corporate overhead, net class action settlement costs, other expenses, debt and related interest expense from Tyco International. These allocations may not be reflective of the actual level of costs or debt which would have been incurred had the Company operated as a separate entity apart from Tyco International.
        As discussed in Note 2 to the consolidated and combined financial statements, in fiscal 2007, the Company adopted Statement of Financial Accounting Standards No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87, 88, 106, and 132(R).
        As discussed in Note 13 to the consolidated and combined financial statements, in connection with its separation from Tyco International, the Company entered into certain guarantee commitments with Tyco International and Covidien Ltd. and has recorded the fair value of these guarantees.
        As discussed in Note 2 to the consolidated and combined financial statements, in fiscal 2006, the Company adopted Statement of Financial Accounting Standards No. 123R, Share-Based Payment .
79

        As discussed in Notes 2 and 15 to the consolidated and combined financial statements, in fiscal 2005, the Company changed the measurement date of its pension and post retirement plans from September 30 to August 31.
/s/   Deloitte & Touche LLP      
December 14, 2007
Philadelphia, Pennsylvania
80

 TYCO ELECTRONICS LTD.

CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS

Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions, except per share data)
	 	
Net sales	 	$	13,460	 	$	12,300	 	$	11,433	 	
Cost of sales	 	 	10,012	 	 	8,999	 	 	8,334	 	
 	 		 		 		 	
 	Gross income	 	 	3,448	 	 	3,301	 	 	3,099	 	
Selling, general, and administrative expenses	 	 	1,664	 	 	1,524	 	 	1,403	 	
Allocated class action settlement costs, net	 	 	887	 	 	—	 	 	—	 	
Separation costs	 	 	45	 	 	—	 	 	—	 	
Restructuring and other charges (credits), net	 	 	99	 	 	13	 	 	(10	)	
Goodwill impairment	 	 	—	 	 	316	 	 	—	 	
Gain on divestiture	 	 	—	 	 	—	 	 	(301	)	
 	 		 		 		 	
 	Income from operations	 	 	753	 	 	1,448	 	 	2,007	 	
Interest income	 	 	53	 	 	48	 	 	44	 	
Interest expense	 	 	(231	)	 	(256	)	 	(293	)	
Other expense, net	 	 	(219	)	 	—	 	 	(365	)	
 	 		 		 		 	
 	Income from continuing operations before income taxes and minority interest	 	 	356	 	 	1,240	 	 	1,393	 	
Income taxes	 	 	(494	)	 	(46	)	 	(376	)	
Minority interest	 	 	(6	)	 	(6	)	 	(6	)	
 	 		 		 		 	
 	(Loss) income from continuing operations	 	 	(144	)	 	1,188	 	 	1,011	 	
(Loss) income from discontinued operations, net of income taxes	 	 	(410	)	 	13	 	 	122	 	
 	 		 		 		 	
 	(Loss) income before cumulative effect of accounting change	 	 	(554	)	 	1,201	 	 	1,133	 	
Cumulative effect of accounting change, net of income taxes	 	 	—	 	 	(8	)	 	11	 	
 	 		 		 		 	
 	Net (loss) income	 	$	(554	)	$	1,193	 	$	1,144	 	

Basic and diluted (loss) earnings per share:	

 	

 	

 	
 	
 	(Loss) income from continuing operations	 	$	(0.29	)	$	2.39	 	$	2.03	 	
 	(Loss) income from discontinued operations	 	 	(0.82	)	 	0.03	 	 	0.25	 	
 	 		 		 		 	
 	(Loss) income before cumulative effect of accounting change	 	 	(1.11	)	 	2.42	 	 	2.28	 	
 	Cumulative effect of accounting change	 	 	—	 	 	(0.02	)	 	0.02	 	
 	 		 		 		 	
 	Net (loss) income	 	$	(1.11	)	$	2.40	 	$	2.30	 	

Weighted-average number of shares outstanding:	

 	

 	

 	
 	
 	Basic and diluted	 	 	497	 	 	497	 	 	497	 	
See Notes to Consolidated and Combined Financial Statements.
81

 TYCO ELECTRONICS LTD.

CONSOLIDATED AND COMBINED BALANCE SHEETS

As of September 28, 2007 and September 29, 2006

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions, except share data)
	
Assets	 	 	 	 	 	 	
Current Assets:	 	 	 	 	 	 	
 	Cash and cash equivalents	 	$	936	 	$	469	
 	Accounts receivable, net of allowance for doubtful accounts of $60 and $59, respectively	 	 	2,686	 	 	2,434	
 	Inventories	 	 	2,047	 	 	1,850	
 	Class action settlement escrow	 	 	928	 	 	—	
 	Class action settlement receivable	 	 	2,064	 	 	—	
 	Prepaid expenses and other current assets	 	 	672	 	 	447	
 	Deferred income taxes	 	 	325	 	 	368	
 	Assets held for sale	 	 	215	 	 	982	
 	 		 		
 	 	Total current assets	 	 	9,873	 	 	6,550	
Property, plant, and equipment, net	 	 	3,505	 	 	3,076	
Goodwill	 	 	7,177	 	 	7,135	
Intangible assets, net	 	 	554	 	 	576	
Deferred income taxes	 	 	1,397	 	 	1,501	
Receivable from Tyco International Ltd. and Covidien Ltd.	 	 	844	 	 	—	
Other assets	 	 	338	 	 	253	
 	 		 		
 	 	Total Assets	 	$	23,688	 	$	19,091	

Liabilities and Equity	

 	

 	
Current Liabilities:	 	 	 	 	 	 	
 	Current maturities of long-term debt, including amounts due to Tyco International Ltd. and affiliates of $285 at September 29, 2006	 	$	5	 	$	291	
 	Accounts payable	 	 	1,382	 	 	1,251	
 	Class action settlement liability	 	 	2,992	 	 	—	
 	Accrued and other current liabilities	 	 	1,450	 	 	1,307	
 	Deferred revenue	 	 	191	 	 	155	
 	Liabilities held for sale	 	 	165	 	 	145	
 	 		 		
 	 	Total current liabilities	 	 	6,185	 	 	3,149	
Long-term debt and obligations under capital lease, including amounts due to Tyco International Ltd. and affiliates of $3,225 at September 29, 2006	 	 	3,373	 	 	3,371	
Long-term pension and postretirement liabilities	 	 	607	 	 	491	
Deferred income taxes	 	 	271	 	 	380	
Income taxes	 	 	1,242	 	 	190	
Other liabilities	 	 	618	 	 	334	
 	 		 		
 	 	Total Liabilities	 	 	12,296	 	 	7,915	
 	 		 		
Commitments and contingencies (Note 16)	 	 	 	 	 	 	
Minority interest	 	 	15	 	 	16	
Equity:	 	 	 	 	 	 	
 	Preferred shares, $0.20 par value, 125,000,000 shares authorized; none outstanding	 	 	—	 	 	—	
 	Common shares, $0.20 par value, 1,000,000,000 authorized; 497,423,476 issued and outstanding at September 28, 2007	 	 	99	 	 	—	
 	Capital in excess:	 	 	 	 	 	 	
 	 	Share premium	 	 	13	 	 	—	
 	 	Contributed surplus	 	 	10,027	 	 	—	
 	Parent company investment	 	 	—	 	 	10,490	
 	Accumulated earnings	 	 	186	 	 	—	
 	Accumulated other comprehensive income	 	 	1,052	 	 	670	
 	 		 		
 	 	Total Equity	 	 	11,377	 	 	11,160	
 	 		 		
 	 	Total Liabilities and Equity	 	$	23,688	 	$	19,091	
 	 		 		
See Notes to Consolidated and Combined Financial Statements.
82

 TYCO ELECTRONICS LTD.

CONSOLIDATED AND COMBINED STATEMENTS OF EQUITY

Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005

Common Shares
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 			 	Share
Premium
	 	Contributed
Surplus
	 	Parent
Company
Investment
	 	Accumulated
Earnings
	 	Accumulated Other
Comprehensive
Income
	 	Total
Equity
	 	Comprehensive
Income
	 	
 	 	Shares
	 	Amount
															 	
 	 	(in millions)
	 	
Balance at October 1, 2004	 	—	 	$	—	 	$	—	 	$	—	 	$	7,751	 	$	—	 	$	491	 	$	8,242	 	 	 	 	
Comprehensive income:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	 	—	 	 	—	 	 	—	 	 	—	 	 	1,144	 	 	—	 	 	—	 	 	1,144	 	$	1,144	 	
Currency translation	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(87	)	 	(87	)	 	(87	)	
Unrealized loss on marketable securities, net of income taxes	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(1	)	 	(1	)	 	(1	)	
Minimum pension liability, net of income taxes	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(72	)	 	(72	)	 	(72	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Total comprehensive income	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	984	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Reporting calendar alignment, net of income taxes	 	—	 	 	—	 	 	—	 	 	—	 	 	(21	)	 	—	 	 	—	 	 	(21	)	 	 	 	
Net transfers from former parent	 	—	 	 	—	 	 	—	 	 	—	 	 	637	 	 	—	 	 	—	 	 	637	 	 	 	 	
 	 		 		 		 		 		 		 		 		 	 	 	 	
Balance at September 30, 2005	 	—	 	 	—	 	 	—	 	 	—	 	 	9,511	 	 	—	 	 	331	 	 	9,842	 	 	 	 	
Comprehensive income:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	 	—	 	 	—	 	 	—	 	 	—	 	 	1,193	 	 	—	 	 	—	 	 	1,193	 	$	1,193	 	
Currency translation	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	242	 	 	242	 	 	242	 	
Minimum pension liability, net of income taxes	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	97	 	 	97	 	 	97	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Total comprehensive income	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	1,532	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Net transfers to former parent	 	—	 	 	—	 	 	—	 	 	—	 	 	(214	)	 	—	 	 	—	 	 	(214	)	 	 	 	
 	 		 		 		 		 		 		 		 		 	 	 	 	
Balance at September 29, 2006	 	—	 	 	—	 	 	—	 	 	—	 	 	10,490	 	 	—	 	 	670	 	 	11,160	 	 	 	 	
Comprehensive income:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net (loss) income	 	—	 	 	—	 	 	—	 	 	—	 	 	(810	)	 	256	 	 	—	 	 	(554	)	$	(554	)	
Currency translation	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	453	 	 	453	 	 	453	 	
Minimum pension liability, net of income taxes	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	207	 	 	207	 	 	207	 	
Impact of adoption of SFAS No. 158, net of tax	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(225	)	 	(225	)	 	—	 	
Unrealized loss on cash flow hedge	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(53	)	 	(53	)	 	(53	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Total comprehensive income	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	53	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	
Net transfers from former parent	 	—	 	 	—	 	 	—	 	 	—	 	 	848	 	 	—	 	 	—	 	 	848	 	 	 	 	
Transfer of parent company investment to contributed surplus	 	—	 	 	—	 	 	—	 	 	10,528	 	 	(10,528	)	 	—	 	 	—	 	 	—	 	 	 	 	
Guarantees and shared tax liabilities to Tyco International and Covidien in accordance with the Tax Sharing Agreement	 	—	 	 	—	 	 	—	 	 	(296	)	 	—	 	 	—	 	 	—	 	 	(296	)	 	 	 	
Due from Tyco International and Covidien in accordance with the Tax Sharing Agreement	 	—	 	 	—	 	 	—	 	 	844	 	 	—	 	 	—	 	 	—	 	 	844	 	 	 	 	
Income tax liabilities assumed upon Separation	 	—	 	 	—	 	 	—	 	 	(1,091	)	 	—	 	 	—	 	 	—	 	 	(1,091	)	 	 	 	
Issuance of common shares	 	497	 	 	99	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	99	 	 	 	 	
Compensation expense, including charge related to Tyco International equity award conversion	 	—	 	 	—	 	 	—	 	 	44	 	 	—	 	 	—	 	 	—	 	 	44	 	 	 	 	
Dividends declared	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	(70	)	 	—	 	 	(70	)	 	 	 	
Exercise of share options	 	—	 	 	—	 	 	13	 	 	—	 	 	—	 	 	—	 	 	—	 	 	13	 	 	 	 	
Repurchase of common shares	 	—	 	 	—	 	 	—	 	 	(2	)	 	—	 	 	—	 	 	—	 	 	(2	)	 	 	 	
 	 		 		 		 		 		 		 		 		 	 	 	 	
Balance at September 28, 2007	 	497	 	$	99	 	$	13	 	$	10,027	 	$	—	 	$	186	 	$	1,052	 	$	11,377	 	 	 	 	
 	 		 		 		 		 		 		 		 		 	 	 	 	
See Notes to Consolidated and Combined Financial Statements.
83

 TYCO ELECTRONICS LTD.

CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS

Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Cash Flows From Operating Activities:	 	 	 	 	 	 	 	 	 	 	
Net (loss) income	 	$	(554	)	$	1,193	 	$	1,144	 	
 	Income (loss) from discontinued operations, net of income taxes	 	 	410	 	 	(13	)	 	(122	)	
 	Cumulative effect of accounting change, net of income taxes	 	 	—	 	 	8	 	 	(11	)	
 	 		 		 		 	
(Loss) from continuing operations	 	 	(144	)	 	1,188	 	 	1,011	 	
Adjustments to reconcile net cash provided by operating activities:	 	 	 	 	 	 	 	 	 	 	
 	Allocated class action settlement costs, net	 	 	887	 	 	—	 	 	—	 	
 	Non-cash restructuring and other charges (credits), net	 	 	26	 	 	6	 	 	(16	)	
 	Gain on divestiture	 	 	—	 	 	—	 	 	(301	)	
 	Depreciation and amortization	 	 	535	 	 	484	 	 	490	 	
 	Deferred income taxes	 	 	162	 	 	(51	)	 	(54	)	
 	Provision for losses on accounts receivable and inventory	 	 	84	 	 	70	 	 	75	 	
 	Allocated loss on retirement of debt	 	 	232	 	 	—	 	 	365	 	
 	Goodwill impairment	 	 	—	 	 	316	 	 	—	 	
 	Other	 	 	(31	)	 	9	 	 	10	 	
 	Changes in assets and liabilities, net of the effects of acquisitions and divestitures:	 	 	 	 	 	 	 	 	 	 	
 	 	Accounts receivable, net	 	 	(95	)	 	(134	)	 	(484	)	
 	 	Inventories	 	 	(124	)	 	(334	)	 	49	 	
 	 	Other current assets	 	 	(108	)	 	(65	)	 	43	 	
 	 	Accounts payable	 	 	87	 	 	262	 	 	188	 	
 	 	Accrued and other liabilities	 	 	105	 	 	91	 	 	23	 	
 	 	Income taxes	 	 	(125	)	 	(179	)	 	135	 	
 	 	Deferred revenue	 	 	28	 	 	(5	)	 	48	 	
 	 	Long-term pension and postretirement liabilities	 	 	—	 	 	25	 	 	45	 	
 	 	Other	 	 	19	 	 	(18	)	 	(81	)	
 	 		 		 		 	
 	 	 	Net cash provided by operating activities	 	 	1,538	 	 	1,665	 	 	1,546	 	
 	 	 	Net cash used in discontinued operating activities	 	 	(13	)	 	(2	)	 	(35	)	
 	 		 		 		 	
Cash Flows From Investing Activities:	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	(892	)	 	(555	)	 	(476	)	
Proceeds from sale of property, plant, and equipment	 	 	72	 	 	12	 	 	23	 	
Acquisition of businesses, net of cash acquired	 	 	—	 	 	(23	)	 	(12	)	
Purchase accounting and holdback/earn-out liabilities	 	 	(3	)	 	(3	)	 	(8	)	
Class action settlement escrow	 	 	(928	)	 	—	 	 	—	 	
Proceeds from divestiture of discontinued operation, net of cash retained by business sold	 	 	227	 	 	—	 	 	—	 	
Proceeds from divestiture of business, net of cash retained by business sold	 	 	—	 	 	—	 	 	130	 	
Other	 	 	—	 	 	26	 	 	61	 	
 	 		 		 		 	
 	 	 	Net cash used in investing activities	 	 	(1,524	)	 	(543	)	 	(282	)	
 	 	 	Net cash used in discontinued investing activities	 	 	(4	)	 	(96	)	 	(4	)	
 	 		 		 		 	
Cash Flows From Financing Activities:	 	 	 	 	 	 	 	 	 	 	
Debt proceeds	 	 	5,676	 	 	—	 	 	—	 	
Allocated debt activity	 	 	(3,743	)	 	(731	)	 	(1,330	)	
Repayment of debt	 	 	(2,455	)	 	(113	)	 	(114	)	
Net transactions with former parent	 	 	1,112	 	 	(74	)	 	85	 	
Transfers (to) from discontinued operations	 	 	(181	)	 	2	 	 	(16	)	
Minority interest distributions paid	 	 	(7	)	 	(12	)	 	(12	)	
Other	 	 	5	 	 	(4	)	 	(1	)	
 	 		 		 		 	
 	 	 	Net cash provided by (used in) financing activities	 	 	407	 	 	(932	)	 	(1,388	)	
 	 	 	Net cash provided by discontinued financing activities	 	 	24	 	 	104	 	 	35	 	
 	 		 		 		 	
Effect of currency translation on cash	 	 	46	 	 	(1	)	 	11	 	
Net increase (decrease) in cash and cash equivalents	 	 	474	 	 	195	 	 	(117	)	
Less: net (increase) decrease in cash and cash equivalents related to discontinued operations	 	 	(7	)	 	(6	)	 	4	 	
Cash and cash equivalents at beginning of fiscal year	 	 	469	 	 	280	 	 	393	 	
 	 		 		 		 	
Cash and cash equivalents at end of fiscal year	 	$	936	 	$	469	 	$	280	 	
 	 		 		 		 	
Supplementary Cash Flow Information:	 	 	 	 	 	 	 	 	 	 	
Interest paid	 	$	231	 	$	262	 	$	295	 	
Income taxes paid, net of refunds	 	 	454	 	 	276	 	 	295	 	
See Notes to Consolidated and Combined Financial Statements.
84

 TYCO ELECTRONICS LTD.

NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
1. Separation and Basis of Presentation
The Separation
        Effective June 29, 2007, Tyco Electronics Ltd. ("Tyco Electronics" or the "Company"), a company organized under the laws of Bermuda, became the parent company of the former electronics businesses of Tyco International Ltd. ("Tyco International"). On June 29, 2007, Tyco International distributed all of its shares of Tyco Electronics, as well as its shares of its former healthcare businesses ("Covidien"), to its common shareholders (the "Separation").
Basis of Presentation
        The accompanying Consolidated and Combined Financial Statements reflect the consolidated operations of Tyco Electronics Ltd. and its subsidiaries as an independent, publicly-traded company as of and subsequent to June 29, 2007 and a combined reporting entity comprising the assets and liabilities used in managing and operating the electronics businesses of Tyco International, including Tyco Electronics Ltd., for periods prior to June 29, 2007.
        The Consolidated and Combined Financial Statements have been prepared in United States dollars, in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The preparation of the Consolidated and Combined Financial Statements in conformity with GAAP requires management to make use of estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Significant estimates in these Consolidated and Combined Financial Statements include restructuring and other charges and credits, acquisition liabilities, allowances for doubtful accounts receivable, estimates of future cash flows associated with asset impairments, useful lives for depreciation and amortization, loss contingencies, net realizable value of inventories, estimated contract revenue and related costs, legal liabilities, tax reserves and deferred tax asset valuation allowances, and the determination of discount and other rate assumptions for pension and postretirement employee benefit expenses. Actual results could differ materially from these estimates.
        The Consolidated and Combined Financial Statements for periods prior to and including June 29, 2007 may not be indicative of the Company's future performance and do not necessarily reflect what its consolidated and combined results of operations, financial position, and cash flows would have been had it operated as an independent, publicly-traded company during the periods presented, including changes in the Company's capitalization as a result of the Separation from Tyco International. To the extent that an asset, liability, revenue, or expense is directly associated with the Company, it is reflected in the accompanying Consolidated and Combined Financial Statements. Certain general corporate overhead, net class action settlement costs, and other expenses as well as debt and related net interest expense for periods prior to the Separation have been allocated by Tyco International to the Company. Management believes such allocations were reasonable; however, they may not be indicative of the actual results of the Company had the Company been operating as an independent, publicly-traded company for the periods presented. See Note 17 for further information regarding allocated expenses.
Description of the Business
        The Company consists of four reportable segments:
•
Electronic Components.     The Electronic Components segment is one of the world's largest suppliers of passive electronic components, which includes connectors and interconnect systems, relays, switches, circuit protection devices, touchscreens, sensors, and wire and cable. The
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products sold by the Electronic Components segment are sold primarily to original equipment manufacturers and their contract manufacturers in the automotive, computer, consumer electronics, communication equipment, appliance, aerospace and defense, industrial machinery, and instrumentation markets.
•
Network Solutions.     The Network Solutions segment is one of the world's largest suppliers of infrastructure components and systems for telecommunications and energy markets. These components include connectors, above- and below-ground enclosures, heat shrink tubing, cable accessories, surge arrestors, fiber optic cabling, copper cabling, and racks for copper and fiber networks. This segment also provides electronic systems for test access and intelligent cross-connect applications as well as integrated cabling solutions for cabling and building management.

•
Wireless Systems.     The Wireless Systems segment is an innovator of wireless technology for critical communications, radar, and defense applications. The segment's products include radio frequency components and subassembly solutions such as silicon and gallium arsenide semiconductors, radar sensors, radio frequency identification components, microwave subsystems, and diodes and land mobile radio systems and related products. These products are sold primarily to the aerospace and defense, public safety, communication equipment, and automotive markets.

•
Undersea Telecommunications.     The Undersea Telecommunications segment designs, builds, maintains, and tests undersea fiber optic networks for both the telecommunications and oil and gas markets.
Principles of Consolidation
        The Company consolidates entities in which it owns or controls more than fifty percent of the voting shares or otherwise has the ability to control through similar rights. In addition, the Company consolidates variable interest entities in which the Company bears a majority of the risk to the entities' expected losses or stands to gain from a majority of the entities' expected returns. All intercompany transactions have been eliminated. The results of companies acquired or disposed of are included in the Consolidated and Combined Financial Statements from the effective date of acquisition or up to the date of disposal.
Change in Fiscal Year and Reporting Calendar Alignment
        Unless otherwise indicated, references in the Consolidated and Combined Financial Statements to fiscal 2007, fiscal 2006, and fiscal 2005 are to Tyco Electronics' fiscal years ended September 28, 2007, September 29, 2006, and September 30, 2005. Effective October 1, 2004, Tyco Electronics changed its fiscal year end from a calendar fiscal year ending September 30th to a "52-53 week" year ending on the last Friday of September, such that each quarterly period is 13 weeks in length. For fiscal years in which there are 53 weeks, the fourth quarter reporting period will include 14 weeks, with the first such occurrence taking place in fiscal 2011. The impact of this change was not material to the Combined Financial Statements. Net income for the transition period related to this change was $21 million after-tax, $29 million pre-tax, and was reported within equity.
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2. Summary of Significant Accounting Policies
Revenue Recognition
        The Company's revenues are generated principally from the sale of its products. Revenue from the sale of products is recognized at the time title and risks and rewards of ownership pass to the customer. This is generally when the products reach the free-on-board shipping point, the sales price is fixed and determinable, and collection is reasonably assured. For those items where title has not yet transferred, the Company has deferred the recognition of revenue.
        The Company provides certain distributors with an inventory allowance for returns or scrap equal to a percentage of qualified purchases. A reserve for estimated scrap and returns allowances is established at the time of the sale based on a fixed percentage of sales to distributors authorized and agreed to by the Company and is recorded as a reduction of sales.
        Other allowances include customer quantity and price discrepancies. A reserve for other allowances is established at the time of sale based on historical experience and is recorded as a reduction of sales. The Company believes it can reasonably and reliably estimate the amounts of future allowances.
        Contract sales for construction related projects are recorded primarily on the percentage-of-completion method. Profits recognized on contracts in process are based upon estimated contract revenue and related cost to complete. Percentage-of-completion is measured based on the ratio of actual cost incurred to total estimated cost. Revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the current period. Provisions for anticipated losses are made in the period in which they first become determinable. Contract sales for construction related projects are generated primarily within the Company's Wireless Systems and Undersea Telecommunications segments.
        The Company typically warrants that its products will conform to the Company's specifications and that its products will be free from material defects in materials and manufacturing. The Company limits its liability to the replacement of defective parts or the cash value of replacement parts. The Company accepts returned goods only when the customer makes a claim and management has authorized the return. Returns result primarily from defective products or shipping discrepancies. A reserve for estimated returns is established at the time of sale based on historical return experience and is recorded as a reduction of sales.
        Additionally, certain of the Company's long-term contracts in its Wireless Systems and Undersea Telecommunications segments have warranty obligations. Estimated warranty costs for each contract are determined based on the contract terms and technology specific considerations. These costs are included in total estimated contract costs and are accrued over the construction period of the respective contracts under percentage-of-completion accounting.
        On September 26, 2005, the Company's Wireless Systems segment entered into a twenty year lease contract with the State of New York to construct, operate, and maintain a statewide wireless communications network for use by state and municipal first responders worth $2 billion. Lease terms and payment streams begin when each of the regional networks that make up the statewide network are determined to meet the operational requirements of the contract and are accepted by the State of New York, with the lease terms running through September 2025.
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        The Company is accounting for each regional network as a stand-alone sales-type lease and will recognize seller's profit on acceptance of each region. As of fiscal 2007, 2006, and 2005, no acceptance events have occurred with any region and therefore the Company has not recognized any revenue on the construction of the network. Costs totaling $28 million and $8 million in fiscal 2007 and 2006, respectively, associated with the development and construction of the statewide wireless network, including interest expense incurred to finance the construction, have been capitalized primarily as inventories on the Consolidated and Combined Balance Sheets. No costs were incurred in fiscal 2005.
Research and Development
        Research and development expenditures are expensed when incurred and are included in cost of sales. Research and development expenses include salaries, direct costs incurred, and building and overhead expenses. The amounts expensed in fiscal 2007, 2006, and 2005 were $520 million, $467 million, and $424 million, respectively.
Cash and Cash Equivalents
        All highly liquid investments purchased with maturities of three months or less from the time of purchase are considered to be cash equivalents.
Allowance for Doubtful Accounts
        The allowance for doubtful accounts receivable reflects the best estimate of probable losses inherent in the Company's outstanding receivables determined on the basis of historical experience, specific allowances for known troubled accounts, and other currently available evidence.
Inventories
        Inventories are recorded at the lower of cost (first-in, first-out) or market value.
Property, Plant, and Equipment, Net and Long-Lived Assets
        Property, plant, and equipment, net is recorded at cost less accumulated depreciation. Maintenance and repair expenditures are charged to expense when incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets as follows:

Buildings and related improvements	 	5 to 40 years	
Leasehold improvements	 	Lesser of remaining term of the lease or economic useful life	
Machinery and equipment	 	1 to 20 years	
        The Company periodically evaluates the net realizable value of long-lived assets, including property, plant, and equipment, and amortizable intangible assets, relying on a number of factors including operating results, business plans, economic projections, and anticipated future cash flows. When indicators of potential impairment are present, the carrying values of the assets are evaluated in relation to the operating performance and estimated future undiscounted cash flows of the underlying business. An impairment in the carrying value of an asset group is recognized whenever anticipated future undiscounted cash flows from an asset group are estimated to be less than its carrying value.
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The amount of impairment recognized is the difference between the carrying value of the asset and its fair value. Fair value estimates are based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates, reflecting varying degrees of perceived risk.
Goodwill and Other Intangible Assets
        Intangible assets acquired include both those that have a determinable life and residual goodwill. Intangible assets with a determinable life include primarily intellectual property consisting of patents, trademarks, and unpatented technology with estimates of recoverability ranging from 3 to 50 years that are amortized on a straight-line basis. See Note 10 for additional information regarding intangible assets. An evaluation of the remaining useful life of intangible assets with a determinable life is performed on a periodic basis when events and circumstances warrant an evaluation. The Company assesses intangible assets with a determinable life for impairment consistent with its policy for assessing other long-lived assets. Goodwill is assessed for impairment separately from other intangible assets with a determinable life by comparing the carrying value of each reporting unit to its fair value on the first day of the fourth quarter of each year or whenever the Company believes a triggering event requiring a more frequent assessment has occurred. In making this assessment, management relies on a number of factors including operating results, business plans, economic projections, anticipated future cash flows, transactions, and market place data. There are inherent uncertainties related to these factors and management's judgment in applying them to the analysis of goodwill impairment.
        As of fiscal year end 2007, the Company has 16 reporting units, of which 13 contain goodwill that is assessed for impairment. When changes occur in the composition of one or more operating segments or reporting units, the goodwill is reassigned to the reporting units affected based on their relative fair values.
        When testing for goodwill impairment, the Company performs a step I goodwill impairment test to identify a potential impairment. In doing so, the Company compares the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, goodwill may be impaired and a step II goodwill impairment test is performed to measure the amount of any impairment loss. In the step II goodwill impairment test, the Company compares the implied fair value of reporting unit goodwill with the carrying value of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner that the amount of goodwill recognized in a business combination is determined. The Company allocates the fair value of a reporting unit to all of the assets and liabilities of that unit, including intangible assets, as if the reporting unit had been acquired in a business combination. Any excess of the value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill.
        Estimates about fair value used in the step I goodwill impairment tests have been calculated using an income approach based on the present value of future cash flows of each reporting unit. The income approach has been supported by other valuation approaches, such as similar transaction and guideline analyses. These approaches incorporate many assumptions including future growth rates, discount factors, and income tax rates in assessing fair value. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairments in future periods.
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Income Taxes
        Income taxes are computed in accordance with the provisions of Statement of Financial Accounting Standards ("SFAS") No. 109, " Accounting for Income Taxes ." In these Consolidated and Combined Financial Statements, the benefits of a consolidated return have been reflected where such returns have or could be filed based on the entities and jurisdictions included in the financial statements. Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been reflected in the Consolidated and Combined Financial Statements. Deferred tax liabilities and assets are determined based on the differences between the book and tax bases of particular assets and liabilities and operating loss carryforwards using tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is provided to offset deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
Financial Instruments
        In order to address certain financial exposures, the Company recently adopted a risk management program that includes the use of derivative and non-derivative financial instruments. The Company has established policies regarding the types and notional value of derivative financial instruments that can be entered into. The Company currently enters into foreign exchange forwards and swaps to reduce the effects of fluctuating foreign exchange rates and has designated certain intercompany non-derivative financial instruments denominated in foreign currencies as a hedging of its net investments in certain foreign operations denominated in the same foreign currencies.
        All derivative financial instruments are reported on the Consolidated and Combined Balance Sheets at fair value. Changes in the derivative's fair value are recognized currently in earnings in selling, general, and administrative expenses in the Consolidated and Combined Statements of Operations because the Company has not designated the derivatives as either a cash flow hedge or a fair value hedge. The remeasurement of the intercompany non-derivative financial instruments designated as a hedge of the company's net investment in foreign operations is recorded in cumulative translation adjustment in accumulated other comprehensive income on the Consolidated and Combined Balance Sheets offsetting the change in cumulative translation adjustment attributable to the Company's net investments in certain foreign operations.
        The Company determines the fair value of its financial instruments by using methods and assumptions that are based on market conditions and risks existing at each balance sheet date. For the majority of financial instruments, including derivatives, standard market conventions are used to determine fair value. For financial instruments that cannot be valued by means of standard market conventions, valuations are obtained from third-party financial institutions known to be active and significant participants in the relevant market.
        During fiscal 2007, in anticipation of issuing new fixed rate debt, the Company entered into, and concurrent with the Company's fixed rate debt issuance, terminated, forward starting interest rate swaps to hedge the variability in interest expense that would result from changes in interest rates between the date of the swap and the Company's anticipated date of issuing the fixed rate debt. These forward starting interest rate swaps were designated as effective hedges of the probable interest payments under SFAS No. 133, " Accounting for Derivative Financial Instruments and Hedging Activities ." See Note 14 for further information.
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Share-Based Compensation
        The Company adopted SFAS No. 123R, " Share-Based Payment ," on October 1, 2005 using the modified prospective transition method. Under SFAS No. 123R, the Company determines the fair value of share awards on the date of grant using the Black-Scholes valuation model. That fair value is expensed ratably over the expected service period, with an allowance made for estimated forfeitures based on historical employee activity. See Note 23 for additional information related to the Company's share-based compensation.
Share Premium and Contributed Surplus
        In accordance with the Bermuda Companies Act 1981, when the Company issues shares for cash at a premium to their par value, the resulting premium is credited to a share premium account, a non-distributable reserve. Contributed surplus, subject to certain conditions, is a distributable reserve.
Currency Translation
        For the Company's non-U.S. dollar functional currency subsidiaries with a functional currency other than U.S. dollars, assets and liabilities are translated into U.S. dollars using year-end exchange rates. Sales and expenses are translated at the average exchange rates in effect during the year. Foreign currency translation gains and losses are included as a component of accumulated other comprehensive income within equity.
        Gains and losses resulting from foreign currency transactions, which are included in net income, were immaterial in all periods presented.
Cumulative Effect of Accounting Change
        During fiscal 2006, the Company adopted Financial Accounting Standards Board ("FASB") Interpretation No. ("FIN") 47, " Accounting for Conditional Asset Retirement Obligations—an interpretation of FASB Statement No. 143. " Accordingly, the Company recognized asset retirement obligations of $16 million and property, plant, and equipment, net of $4 million in its Combined Balance Sheet at fiscal year end 2006. In addition, the Company recorded a cumulative effect of accounting change which resulted in an $8 million after-tax, $12 million pre-tax, loss.
        During fiscal 2005, the Company changed the measurement date for its pension and postretirement benefit plans from September 30th to August 31st, effective October 1, 2004. The Company believes that the one-month change of measurement date was a preferable change as it allows management adequate time to evaluate and report the actuarial information in the Company's Consolidated and Combined Financial Statements under the accelerated reporting deadlines. As a result of this change, the Company recorded an $11 million after-tax, $13 million pre-tax, gain cumulative effect of accounting change in fiscal 2005. See Note 15 for additional information on the Company's retirement plans.
Recently Adopted Accounting Pronouncements
        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 No. 158 requires that employers recognize the funded status of defined benefit pension
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and other postretirement benefit plans as a net asset or liability on the balance sheet and recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise during the period but are not recognized as a component of net periodic benefit cost. Under SFAS No. 158, companies are required to measure plan assets and benefit obligations as of their fiscal year end. The Company currently uses a measurement date of August 31st. SFAS No. 158 also requires additional disclosure in the notes to the financial statements. The measurement date provisions will become effective for the Company in fiscal 2009. The Company is currently assessing the impact of the measurement date change provisions on its results of operations, financial position, or cash flows. The Company adopted the funded status recognition provisions at September 28, 2007. The incremental effects of adopting the standard on the Consolidated Balance Sheet are increases of $386 million in long-term pension and postretirement benefit liabilities, $16 million in accrued and other current liabilities, and $55 million in other assets. The impact of adoption also resulted in additional net deferred tax assets of $122 million. The impact of adoption to accumulated other comprehensive income, a component of equity, was a reduction of $225 million. There was no impact on pension or other postretirement benefit expense, cash flows, or benefits plans in fiscal 2007. On-going compliance with the standard will not impact pension or other postretirement benefit expense, cash flows, or benefit plans. See Note 15 for further discussion of the implementation of the recognition provisions of SFAS No. 158.
        In September 2006, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin ("SAB") No. 108, " Considering the Effect of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. " SAB No. 108 provides guidance on evaluating the materiality of prior periods' misstatements, quantifying the effects of correcting misstatements in the current period and criteria for restatement of prior periods. SAB No. 108 is effective for fiscal years ending after November 15, 2006. The Company adopted this guidance effective for fiscal 2007. This adoption did not have a material impact on its results of operations, financial position, or cash flows.
Recently Issued Accounting Pronouncements
        In December 2007, the FASB issued SFAS No. 141R, " Business Combinations ." SFAS No. 141R replaces SFAS No. 141 and addresses the recognition and accounting for identifiable assets acquired, liabilities assumed, and noncontrolling interests in business combinations. SFAS No. 141R is effective for the Company in the first quarter of fiscal 2010. The Company is currently assessing the impact that SFAS No. 141R will have on its results of operations, financial position, or cash flows.
        In December 2007, the FASB issued SFAS No. 160, " Noncontrolling Interests in Consolidated Financial Statements ." SFAS No. 160 addresses the accounting and reporting framework for minority interests by a parent company. SFAS No. 160 is effective for the Company in the first quarter of fiscal 2010. The Company is currently assessing the impact that SFAS No. 160 will have on its results of operations, financial position, or cash flows.
        In June 2007, the FASB Emerging Issues Task Force issued EITF Issue No. 06-11, " Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards ." EITF 06-11 requires that a realized income tax benefit from dividends or dividend equivalent units paid on unvested restricted shares and restricted share units be reflected as an increase in contributed surplus and reflected as an addition to the Company's excess tax benefit pool, as defined under SFAS No. 123R. EITF 06-11 is effective for
92

the Company in the first quarter of fiscal 2009. The Company is currently assessing the impact that EITF 06-11 will have on its results of operations, financial position, or cash flows.
        In February 2007, the FASB issued SFAS No. 159, " The Fair Value Option for Financial Assets and Financial Liabilities. " SFAS No. 159 permits an entity, on a contract-by-contract basis, to make an irrevocable election to account for certain types of financial instruments and warranty and insurance contracts at fair value, rather than historical cost, with changes in the fair value, whether realized or unrealized, recognized in earnings. SFAS No. 159 is effective for the Company in the first quarter of fiscal 2009. The Company is currently assessing the impact that SFAS No. 159 will have on its results of operations, financial position, or cash flows.
        In September 2006, the FASB issued SFAS No. 157, " Fair Value Measurements. " SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosure about fair value measurements. SFAS No. 157 is effective for the Company in the first quarter of fiscal 2009. The Company is currently assessing the impact, if any, that SFAS No. 157 will have on its results of operations or financial position.
        In June 2006, the FASB issued FIN 48, " Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109 ." This interpretation prescribes a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. FIN 48 and related interpretations are effective for the Company in the first quarter of fiscal 2008. The cumulative effect of adoption will be recorded as an adjustment to the opening balance of retained earnings for fiscal 2008. The Company is currently assessing the expected impact of adopting FIN 48. Based upon its evaluation to date, the Company estimates that the adjustment to the opening balance of retained earnings will be $100 to $200 million. This adjustment includes an estimated net increase in contingent liabilities upon adoption of FIN 48 of $300 to $400 million, excluding interest, reduced by the portion of these contingent liabilities for which Tyco International and Covidien are contractually obligated under the terms of the Tax Sharing Agreement. See Note 17 for additional information regarding responsibilities for unresolved legacy tax matters.
3. Separation Costs
        In connection with the Separation, the Company incurred costs of $45 million in fiscal 2007, primarily related to employee costs, including non-cash compensation expense of $11 million related to the modification of share option awards at Separation and $13 million related to the acceleration of restricted share award vesting as a result of Separation. See Note 23 for further information on the conversion of Tyco International share option awards into Tyco Electronics share option awards and the acceleration of restricted share award vesting.
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4. Restructuring and Other Charges (Credits), Net
        Charges (credits) to operations by segment during fiscal 2007, 2006, and 2005 were as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Electronic Components	 	$	54	 	$	9	 	$	(1	)	
Network Solutions	 	 	35	 	 	9	 	 	2	 	
Wireless Systems	 	 	10	 	 	5	 	 	1	 	
Undersea Telecommunications	 	 	5	 	 	(4	)	 	(12	)	
 	 		 		 		 	
 	 	$	104	 	$	19	 	$	(10	)	
 	 		 		 		 	
        Amounts recognized in the Consolidated and Combined Statements of Operations during fiscal 2007, 2006, and 2005 were as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Restructuring and other charges (credits), net:	 	 	 	 	 	 	 	 	 	 	
 	Cash charges	 	$	78	 	$	13	 	$	6	 	
 	Non-cash charges (credits)	 	 	21	 	 	—	 	 	(16	)	
 	 		 		 		 	
Total restructuring and other charges (credits), net	 	 	99	 	 	13	 	 	(10	)	
Cost of sales	 	 	5	 	 	6	 	 	—	 	
 	 		 		 		 	
 	 	$	104	 	$	19	 	$	(10	)	
 	 		 		 		 	
Cash Charges
        Activity in the Company's restructuring reserves during fiscal 2007, 2006, and 2005 is summarized as follows:

 	 	Balance at
Beginning
of Year
	 	Charges
	 	Utilization
	 	Changes
in
Estimate
	 	Transfers
from
Held for
Sale (1)(2)
	 	Currency
Translation
	 	Balance at
End of
Year
	
 	 	(in millions)
	
Fiscal 2007 Activity:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Fiscal 2007 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	$	—	 	$	69	 	$	(4	)	$	—	 	$	—	 	$	(1	)	$	64	
 	 	Facilities exit costs	 	 	—	 	 	1	 	 	(1	)	 	—	 	 	1	 	 	—	 	 	1	
 	 	Other costs	 	 	—	 	 	2	 	 	(2	)	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	—	 	 	72	 	 	(7	)	 	—	 	 	1	 	 	(1	)	 	65	
 	 		 		 		 		 		 		 		
 	Fiscal 2006 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	3	 	 	—	 	 	(3	)	 	—	 	 	—	 	 	—	 	 	—	
 	 	Facilities exit costs	 	 	2	 	 	1	 	 	(1	)	 	—	 	 	—	 	 	—	 	 	2	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	5	 	 	1	 	 	(4	)	 	—	 	 	—	 	 	—	 	 	2	
 	 		 		 		 		 		 		 		
 	Pre-Fiscal 2005 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Facilities exit costs	 	 	66	 	 	5	 	 	(15	)	 	—	 	 	7	 	 	2	 	 	65	
 	 		 		 		 		 		 		 		
 	Total fiscal 2007 activity	 	 	71	 	 	78	 	 	(26	)	 	—	 	 	8	 	 	1	 	 	132	
 	 		 		 		 		 		 		 		
94

 	 	Balance at
Beginning
of Year
	 	Charges
	 	Utilization
	 	Changes
in
Estimate
	 	Transfers
from
Held for
Sale (1)(2)
	 	Currency
Translation
	 	Balance at
End of
Year
	
 	 	(in millions)
	
Fiscal 2006 Activity:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Fiscal 2006 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	—	 	 	12	 	 	(10	)	 	—	 	 	—	 	 	1	 	 	3	
 	 	Facilities exit costs	 	 	—	 	 	2	 	 	—	 	 	—	 	 	—	 	 	—	 	 	2	
 	 	Other	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	—	 	 	14	 	 	(10	)	 	—	 	 	—	 	 	1	 	 	5	
 	 		 		 		 		 		 		 		
 	Fiscal 2005 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	5	 	 	—	 	 	(5	)	 	—	 	 	—	 	 	—	 	 	—	
 	 	Facilities exit costs	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 	Other	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	5	 	 	—	 	 	(5	)	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	Pre-Fiscal 2005 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	3	 	 	—	 	 	(3	)	 	—	 	 	—	 	 	—	 	 	—	
 	 	Facilities exit costs	 	 	71	 	 	—	 	 	(11	)	 	1	 	 	—	 	 	5	 	 	66	
 	 	Other	 	 	2	 	 	—	 	 	—	 	 	(2	)	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	76	 	 	—	 	 	(14	)	 	(1	)	 	—	 	 	5	 	 	66	
 	 		 		 		 		 		 		 		
 	Total fiscal 2006 activity	 	 	81	 	 	14	 	 	(29	)	 	(1	)	 	—	 	 	6	 	 	71	
 	 		 		 		 		 		 		 		
Fiscal 2005 Activity:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Fiscal 2005 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	—	 	 	8	 	 	(7	)	 	—	 	 	4	 	 	—	 	 	5	
 	 	Facilities exit costs	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 	Other	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	 	 	—	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	—	 	 	8	 	 	(7	)	 	—	 	 	4	 	 	—	 	 	5	
 	 		 		 		 		 		 		 		
 	Pre-Fiscal 2005 Actions	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Employee severance	 	 	15	 	 	—	 	 	(8	)	 	(4	)	 	—	 	 	—	 	 	3	
 	 	Facilities exit costs	 	 	43	 	 	—	 	 	(15	)	 	4	 	 	39	 	 	—	 	 	71	
 	 	Other	 	 	4	 	 	—	 	 	—	 	 	(2	)	 	—	 	 	—	 	 	2	
 	 		 		 		 		 		 		 		
 	 	 	Total	 	 	62	 	 	—	 	 	(23	)	 	(2	)	 	39	 	 	—	 	 	76	
 	 		 		 		 		 		 		 		
 	Total fiscal 2005 activity	 	$	62	 	$	8	 	$	(30	)	$	(2	)	$	43	 	$	—	 	$	81	

(1)
During fiscal 2006, the Printed Circuit Group business was accounted for as held for sale and related restructuring liabilities were reclassified accordingly. During fiscal 2007, the Printed Circuit Group business was sold and $8 million of restructuring liabilities were retained by the Company. See Note 5 for additional information.

(2)
The Tyco Global Network was accounted for as held for sale during fiscal 2004 and related restructuring liabilities were reclassified accordingly. In fiscal 2005, the Tyco Global Network was sold and $39 million of restructuring liabilities were retained by the Company. In addition, the Company transferred $4 million of severance liabilities from liability held for sale as a result of the sale of the Tyco Global Network. See Note 5 for additional information.
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Fiscal 2007 Actions
        The Company initiated restructuring programs during fiscal 2007 relating to the exit of manufacturing operations and the migration of product lines to low cost countries in the Electronic Components and Network Solutions segments and the rationalization of certain product lines in the Wireless Systems segment. In connection with these actions, during fiscal 2007, the Company recorded restructuring charges of $72 million primarily related to employee severance and benefits. The Company expects to complete all restructuring activities commenced in fiscal 2007 by the end of fiscal 2009 and to incur additional charges of approximately $30 million relating to these initiated actions by completion.
Fiscal 2006 Actions
        During fiscal 2006, the Company recorded restructuring charges of $14 million primarily related to employee severance and benefits. These charges included the elimination of 166 positions. As of fiscal year end 2007, the remaining restructuring reserve related to the fiscal 2006 actions is $2 million.
Fiscal 2005 Actions
        During fiscal 2005, the Company recorded restructuring charges of $8 million related to employee severance and benefits. These charges included the elimination of 802 positions. In addition, the Company transferred $4 million of severance liabilities from liability held for sale as a result of the sale of the Tyco Global Network. As of fiscal year end 2007, all actions under these plans are complete.
Pre-Fiscal 2005 Actions
        During fiscal 2002, the Company recorded restructuring charges of $798 million primarily related to a significant downturn in the telecommunications industry and certain other end markets. These actions have been completed. As of fiscal year end 2007, the remaining restructuring reserves related to the fiscal 2002 actions are $65 million, relating to exited lease facilities. During fiscal 2007, the Company recorded restructuring charges of $5 million for interest accretion on these reserves. The Company expects that its remaining reserves will continue to be paid out over the expected terms of the obligations which range from one to fifteen years.
Non-Cash Charges and Credits
        During fiscal 2007, the Company recorded non-cash charges of $21 million primarily related to fixed assets in connection with exited manufacturing operations and $5 million in cost of goods sold for write-downs in carrying value of inventory related to exited product lines.
        During fiscal 2006, the Company recorded non-cash charges of $10 million, including $6 million in cost of goods sold for write-downs in carrying value of inventory related to exited product lines. Also, during fiscal 2005, the Company completed exit activities related to previously acquired operations for which goodwill had been fully impaired in prior years. As these activities were completed for amounts less than originally established as acquisition liabilities, the Company recorded the reversal of the acquisition liabilities as a restructuring and other credit of $4 million.
        During fiscal 2005, the Company sold assets which were previously written down to their net realizable value in fiscal 2002 for amounts greater than originally estimated and recorded related gains
96

as restructuring and other credits of $9 million. Also, during fiscal 2005, the Company completed exit activities related to previously acquired operations for which goodwill had been fully impaired in prior years. As these activities were completed for amounts less than originally established as acquisition liabilities, the Company recorded the reversal of the acquisition liabilities as a restructuring and other credit of $7 million.
Total Restructuring Reserves
        The Company's restructuring reserves by segment at fiscal year end 2007 and 2006 were as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Electronic Components	 	$	29	 	$	1	
Network Solutions	 	 	34	 	 	3	
Wireless Systems	 	 	6	 	 	3	
Undersea Telecommunications	 	 	63	 	 	64	
 	 		 		
Restructuring reserves	 	$	132	 	$	71	
 	 		 		
        At fiscal year end 2007 and 2006, restructuring reserves were included in the Company's Consolidated and Combined Balance Sheets as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Accrued and other current liabilities	 	$	70	 	$	16	
Other liabilities	 	 	62	 	 	55	
 	 		 		
Restructuring reserves	 	$	132	 	$	71	
 	 		 		
5. Discontinued Operations and Divestitures
Discontinued Operations
        The divestiture of the Company's Power Systems business was authorized during fiscal 2007. As a result, the Company assessed Power Systems' assets for impairment under SFAS No. 144, " Accounting for the Impairment and Disposal of Long-Lived Assets ," using a probability-weighted set of expected cash flows from the eventual disposition. The Company determined that the book value of the Power Systems business exceeded its estimated fair value and recorded a $435 million after-tax, $585 million pre-tax, impairment charge in the third quarter of fiscal 2007 in loss from discontinued operations, net of income taxes on the Consolidated and Combined Statement of Operations. Subsequent to year end, the Company entered into a definitive agreement to sell its Power Systems business. See Note 26 for additional information.
        During fiscal 2006, the Company entered into a definitive agreement to divest the Printed Circuit Group business. During the first quarter of fiscal 2007, the Company consummated the sale of the
97

Printed Circuit Group business for $227 million in net cash proceeds and recorded a $45 million pre-tax gain on the sale.
        The Power Systems and Printed Circuit Group businesses met the held for sale and discontinued operations criteria and have been included in discontinued operations in all periods presented. Prior to reclassification as held for sale, both the Power Systems and Printed Circuit Group business were components of the Other segment, which has been renamed the Undersea Telecommunications segment.
        The following table reflects net sales, pre-tax loss from discontinued operations, pre-tax gain on sale of discontinued operations including impairments and costs to sell, and income taxes for fiscal 2007, 2006, and 2005:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Net sales	 	$	490	 	$	940	 	$	882	 	

Pre-tax loss from discontinued operations	
 	
$	
(635	
)	
$	
(34	
)	
$	
(33	
)	
Pre-tax gain on sale of discontinued operations	 	 	45	 	 	—	 	 	—	 	
Income tax benefit	 	 	180	 	 	47	 	 	155	 	
 	 		 		 		 	
(Loss) income from discontinued operations, net of income taxes	 	$	(410	)	$	13	 	$	122	 	
 	 		 		 		 	
        The following table presents balance sheet information for discontinued operations and other businesses held for sale at fiscal year end 2007 and 2006:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Accounts receivable, net	 	$	96	 	$	188	
Inventories	 	 	114	 	 	174	
Intangible assets, net	 	 	—	 	 	452	
Property, plant, and equipment, net	 	 	—	 	 	164	
Other assets	 	 	5	 	 	4	
 	 		 		
 	Total assets	 	$	215	 	$	982	
 	 		 		
Accounts payable	 	$	39	 	$	87	
Accrued and other current liabilities	 	 	24	 	 	48	
Other liabilities	 	 	102	 	 	10	
 	 		 		
 	Total liabilities	 	$	165	 	$	145	
 	 		 		
Gain on Divestiture
        During fiscal 2005, the Company agreed to sell the Tyco Global Network, its undersea fiber optic telecommunication network that was part of the Undersea Telecommunications segment. The sale was consummated on June 30, 2005. As part of the sale transaction, the Company received gross cash
98

proceeds of $130 million and the purchaser assumed certain liabilities. In connection with this sale, the Company recorded a $301 million pre-tax gain which is reflected in gain on divestiture in the Combined Statement of Operations for fiscal 2005. The Company has presented the operations of the Tyco Global Network in continuing operations as the criteria for discontinued operations were not met.
6. Acquisitions
Acquisitions
        During fiscal 2006, the Company acquired one business for an aggregate cost of $18 million and acquired the remaining interest in a joint venture for $5 million. The Company acquired one business for an aggregate cost of $8 million and acquired the remaining interest in a joint venture for $4 million in fiscal 2005. These acquisitions were funded utilizing cash generated from operations. These acquisitions did not have a material effect on the Company's financial position, results of operations, or cash flows.
Holdback and Earn-Out Liabilities
        The Company paid cash related to holdback and earn-out liabilities of approximately $1 million, $82 million, and $2 million during fiscal 2007, 2006, and 2005, respectively, relating to certain prior period acquisitions. The total cash paid in fiscal 2006 was reported in discontinued operations as it related to the Printed Circuit Group business. Holdback liabilities represent a portion of the purchase price withheld from the seller pending finalization of the acquisition balance sheet and other pre-acquisition contingencies. Additionally, certain acquisitions have provisions that would require the Company to make additional contingent purchase price payments to the sellers if the acquired company achieves certain milestones subsequent to its acquisition by the Company. These payments are tied to certain performance measures, such as sales, gross margin, or earnings growth and generally are treated as additional purchase price.
        At fiscal year end 2007 and 2006, holdback and earn-out liabilities of $60 million and $54 million, respectively, were included in other liabilities on the Company's Consolidated and Combined Balance Sheets.
7. Inventories
        At fiscal year end 2007 and 2006, inventories consisted of the following:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Raw materials	 	$	327	 	$	306	
Work in progress	 	 	838	 	 	675	
Finished goods	 	 	882	 	 	869	
 	 		 		
Inventories	 	$	2,047	 	$	1,850	
 	 		 		
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8. Property, Plant, and Equipment, Net
        At fiscal year end 2007 and 2006, property, plant, and equipment, net consisted of the following:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	(in millions)
	 	
Land and improvements	 	$	248	 	$	250	 	
Buildings and leasehold improvements	 	 	1,406	 	 	1,314	 	
Machinery and equipment	 	 	6,404	 	 	5,308	 	
Construction in process	 	 	471	 	 	572	 	
 	 		 		 	
Gross property, plant, and equipment	 	 	8,529	 	 	7,444	 	
Accumulated depreciation	 	 	(5,024	)	 	(4,368	)	
 	 		 		 	
Property, plant, and equipment, net	 	$	3,505	 	$	3,076	 	
 	 		 		 	
        Depreciation expense was $498 million, $448 million, and $457 million in fiscal 2007, 2006, and 2005, respectively.
        Capital leases are included as a component of machinery and equipment. Amortization of assets under capital leases is included in depreciation expense.
        During fiscal 2007, the Company exercised its option to buy five cable-laying sea vessels that were previously leased to the Company and used by the Undersea Telecommunications segment at a cost of $280 million, which was reflected as a capital expenditure.
9. Goodwill
        The changes in the carrying amount of goodwill by segment for fiscal 2007 and 2006 were as follows:

 	 	Electronic
Components
	 	Network
Solutions
	 	Wireless
Systems
	 	Total
	 	
 	 	(in millions)
	 	
Balance at September 30, 2005	 	$	5,947	 	$	841	 	$	635	 	$	7,423	 	
Acquisitions	 	 	5	 	 	1	 	 	—	 	 	6	 	
Impairment	 	 	—	 	 	—	 	 	(316	)	 	(316	)	
Currency translation	 	 	21	 	 	1	 	 	—	 	 	22	 	
 	 		 		 		 		 	
Balance at September 29, 2006	 	 	5,973	 	 	843	 	 	319	 	 	7,135	 	
Purchase accounting adjustments	 	 	(1	)	 	1	 	 	—	 	 	—	 	
Currency translation	 	 	36	 	 	6	 	 	—	 	 	42	 	
 	 		 		 		 		 	
Balance at September 28, 2007	 	$	6,008	 	$	850	 	$	319	 	$	7,177	 	
 	 		 		 		 		 	
        During fiscal 2006, the Company recorded a goodwill impairment of $316 million in its Wireless Systems segment related to the Integrated Wireless Products reporting unit. The impairment charge was incurred when the reporting unit experienced slower growth and profitability than management's previous experience and future expectations due to sales declines in certain end markets.
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10. Intangible Assets, Net
        The Company's intangible assets at fiscal year end 2007 and 2006 were as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	Gross
Carrying
Amount
	 	Accumulated
Amortization
	 	Net
Carrying
Amount
	 	Weighted
Average
Amortization
Period
	 	Gross
Carrying
Amount
	 	Accumulated
Amortization
	 	Net
Carrying
Amount
	 	Weighted
Average
Amortization
Period
	
 	 	($ in millions)
	
Amortizable:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Intellectual property	 	$	858	 	$	(315	)	$	543	 	23 years	 	$	835	 	$	(270	)	$	565	 	23 years	
 	Other	 	 	14	 	 	(3	)	 	11	 	50 years	 	 	12	 	 	(2	)	 	10	 	50 years	
 	 		 		 		 	 	 		 		 		 	 	
Total amortizable	 	 	872	 	 	(318	)	 	554	 	24 years	 	 	847	 	 	(272	)	 	575	 	24 years	
Non-amortizable	 	 	—	 	 	—	 	 	—	 	 	 	 	1	 	 	—	 	 	1	 	 	
 	 		 		 		 	 	 		 		 		 	 	
Intangible assets	 	$	872	 	$	(318	)	$	554	 	 	 	$	848	 	$	(272	)	$	576	 	 	
 	 		 		 		 	 	 		 		 		 	 	
        Intangible asset amortization expense, which is recorded in selling, general, and administrative expenses, was $37 million, $36 million, and $33 million for fiscal 2007, 2006, and 2005, respectively. The estimated aggregate amortization expense on intangible assets currently owned by the Company is expected to be as follows:

 	 	(in millions)
	
Fiscal 2008	 	$	40	
Fiscal 2009	 	 	39	
Fiscal 2010	 	 	38	
Fiscal 2011	 	 	38	
Fiscal 2012	 	 	37	
Thereafter	 	 	362	
 	 		
 	 	$	554	
 	 		
11. Accrued and Other Current Liabilities
        At fiscal year end 2007 and 2006, accrued and other current liabilities consisted of the following:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
Accrued payroll and employee benefits	 	$	359	 	$	335	
Income taxes payable	 	 	245	 	 	394	
Restructuring reserves	 	 	70	 	 	16	
Dividends payable	 	 	70	 	 	—	
Deferred income taxes	 	 	49	 	 	41	
Other	 	 	657	 	 	521	
 	 		 		
Accrued and other current liabilities	 	$	1,450	 	$	1,307	
 	 		 		
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12. Debt
        Debt at fiscal year end 2007 and 2006 was as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	
 	 	(in millions)
	
6.00% senior notes due 2012	 	$	800	 	$	—	
6.55% senior notes due 2017	 	 	747	 	 	—	
7.125% senior notes due 2037	 	 	498	 	 	—	
Unsecured senior bridge loan facility	 	 	550	 	 	—	
Unsecured senior revolving credit facility	 	 	700	 	 	—	
Due to Tyco International Ltd. and affiliates	 	 	—	 	 	3,510	
7.2% notes due 2008	 	 	19	 	 	86	
Other	 	 	64	 	 	66	
 	 		 		
Total debt	 	 	3,378	 	 	3,662	
Less current portion (1)	 	 	5	 	 	291	
 	 		 		
Long-term debt	 	$	3,373	 	$	3,371	

(1)
The current portion of long-term debt at September 28, 2007 was comprised of $5 million of the amount shown as other. At September 29, 2006, the current portion of long-term debt was comprised of $285 million due to Tyco International Ltd. and affiliates and $6 million of the amount shown as other.
        During September 2007, Tyco Electronics Group S.A. ("TEGSA"), a wholly-owned subsidiary of the Company, issued $800 million principal amount of its 6.00% senior notes due 2012, $750 million principal amount of its 6.55% senior notes due 2017, and $500 million principal amount of its 7.125% senior notes due 2037, all of which are fully and unconditionally guaranteed by the Company. TEGSA offered the senior notes in the U.S. to qualified institutional buyers pursuant to Rule 144A of the Securities Act of 1933 (the "Securities Act"). In addition, the initial purchasers, through their respective selling agents, sold less than one-half of one percent of the senior notes outside the U.S. pursuant to Regulation S under the Securities Act. In connection with the issuance of the senior notes, TEGSA and the Company entered into a registration rights agreement with the initial purchasers under which TEGSA and the Company agreed, for the benefit of the holders of the senior notes, to file with the SEC an exchange offer registration statement within 210 days after the date of the original issue of the notes. Net proceeds from the sales of the senior notes were used to repay a portion of borrowings under the unsecured senior bridge loan facility.
        In April 2007, TEGSA entered into a $2,800 million unsecured senior bridge loan facility. The Company is the guarantor of the bridge facility which had an original maturity date of April 23, 2008. On August 31, 2007, the Company and TEGSA amended the unsecured bridge loan facility to permit, at TEGSA's option, an extension of the maturity from April 23, 2008 to April 22, 2009. Borrowings under the bridge facility bear interest, at TEGSA's option, at a base rate or the London interbank offered rate ("LIBOR") plus a margin dependent on TEGSA's credit ratings and the amount drawn under the facility. TEGSA is required to pay an annual facility fee ranging from 4.5 to 12.5 basis points depending on its credit ratings. The bridge facility contains provisions that may require mandatory prepayments or reduction of unused commitments if the Company or TEGSA issues debt or equity. In May 2007, tranche B was added to the bridge facility, increasing the amount of the facility by $775 million. All balances under tranche B of the facility were paid off and all commitments under tranche B were cancelled in August 2007. Borrowings under the bridge facility were used to fund a portion of Tyco International's debt tender offers, to repay a portion of Tyco International's existing
102

bank credit facilities, and to fund the Company's portion of Tyco International's class action settlement escrow. See Note 16 for further information regarding the class action settlement.
        Additionally, in April 2007, TEGSA entered into a five-year unsecured senior revolving credit facility. The Company is the guarantor of the revolving credit facility. The commitments under the revolving credit facility are $1,500 million. Interest and fees under the revolving credit facility are substantially the same as under the bridge loan facility. The revolving credit facility will be used for working capital, capital expenditures, and other corporate purposes.
        As of September 28, 2007, TEGSA had $700 million outstanding under the five-year unsecured senior revolving credit facility, which bore interest at the rate of 5.38%. Also, as of September 28, 2007, TEGSA had $550 million of indebtedness outstanding under the unsecured bridge loan facility, which bore interest at the rate of 5.47%.
        During the third quarter of fiscal 2007, the Company conducted a tender offer to purchase for cash its subsidiary's 7.2% notes due 2008 amounting to $86 million. Approximately $67 million, or 78%, of the notes were tendered and extinguished.
        The Company's debt agreements contain financial and other customary covenants. None of these covenants are presently considered restrictive to the Company's operations. As of September 28, 2007, the Company was in compliance with all of its debt covenants.
        The September 2007 senior notes referred to above are subject to an exchange and registration rights agreement under which if certain registration requirements are not met by the required time or registration is withdrawn or is subject to an effective stop order, there may be a registration default, requiring payment by the Company of liquidated damages in the form of special interest at a rate of 0.25% per annum for the first 90 days of such registration default, and at a rate of 0.50% thereafter, until such registration default is cured. As of September 28, 2007, the Company has determined that the likelihood of a registration default is remote and has not accrued any special interest.
        Tyco International's consolidated debt, exclusive of amounts incurred directly by the Company, was proportionately allocated to the Company at September 29, 2006 based on the historical funding requirements of the Company using historical data. The allocated debt amounts, presented as "Due to Tyco International Ltd. and affiliates," were classified on the Combined Balance Sheet at September 29, 2006 based on the maturities of Tyco International's underlying debt.
        Net interest expense was allocated in the same proportions as debt through June 1, 2007 and includes the impact of interest rate swap agreements designated as fair value hedges. For fiscal 2007, 2006, and 2005, Tyco International has allocated to Tyco Electronics interest expense of $150 million, $234 million, and $271 million, respectively, and interest income of $20 million, $33 million, and $32 million, respectively.
        In addition, Tyco International has allocated to the Company loss on retirement of debt in the amount of $232 million and $365 million for fiscal 2007 and 2005, respectively. Such amounts are included in other expense, net in the Consolidated and Combined Statements of Operations. The method utilized to allocate loss on retirement of debt is consistent with the allocation of debt and net interest expense as described above.
        Management believes the allocation basis for debt, net interest expense, and loss on retirement of debt was reasonable based on the historical financing needs of the Company. However, these amounts
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may not be indicative of the actual amounts that the Company would have incurred had it been operating as an independent, publicly-traded company for the periods presented.
        The fair value of the Company's debt was approximately $3,413 million at fiscal year end 2007. At fiscal year end 2006, the fair value of the Company's external debt, which excludes amounts allocated by Tyco International, was approximately $155 million. For further detail of methods and assumptions used in determining fair value, see Note 2.
        The aggregate amounts of total debt, maturing during the next five years and thereafter are as follows:

 	 	(in millions)
	
Fiscal 2008	 	$	555	
Fiscal 2009	 	 	20	
Fiscal 2010	 	 	1	
Fiscal 2011	 	 	1	
Fiscal 2012	 	 	1,500	
Thereafter	 	 	1,301	
 	 		
Total	 	$	3,378	
 	 		
        The unsecured senior bridge loan facility of $550 million is classified as long-term as a result of the Company's August 31, 2007 amendment to the facility. On the maturity schedule above, the $550 million is presented as maturing in fiscal 2008.
        Certain of the Company's operating subsidiaries have overdraft or similar types of facilities, which totaled $51 million, of which $47 million was undrawn and available at fiscal year end 2007. These facilities, most of which are renewable, expire at various dates through the year 2010 and are established primarily within the Company's international operations.
13. Guarantees
        Pursuant to the Separation and Distribution Agreement and Tax Sharing Agreement, upon Separation, the Company entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. Under these agreements, principally the Tax Sharing Agreement, Tyco International, Covidien, and Tyco Electronics share 27%, 42%, and 31%, respectively, of certain contingent liabilities relating to unresolved tax matters of legacy Tyco International. The effect of the Tax Sharing Agreement is to indemnify the Company for 69% of all liabilities settled by the Company with respect to unresolved legacy tax matters. Pursuant to that indemnification, the Company has made similar indemnifications to Tyco International and Covidien with respect to 31% of all liabilities settled by the companies with respect to unresolved legacy tax matters. If any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, the Company would be responsible for a portion of the defaulting party or parties' obligation.
        The Company's indemnification created under the Tax Sharing Agreement qualifies as a guarantee of a third party entity's debt under FIN 45, " Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others ." FIN 45 addresses the measurement and disclosure of a guarantor's obligation to pay a debt incurred by a third party. To value the initial obligation under FIN 45, the Company considered a range of probability-weighted future cash flows that represent the likelihood of payment of each class of liability by each of the three post-Separation
104

companies. The future cash flows incorporate interest and penalties that the companies believe will be incurred on each class of liabilities and are discounted to the present value to reflect the value associated with each as of September 28, 2007. The FIN 45 calculation includes a premium that reflects the cost for an insurance carrier to stand in and assume the payment obligation. Because the future cash flows include a consideration of all tax positions, both asserted and unasserted, the FIN 45 fair value is reduced by the Company's accrual of 31% of all asserted tax liabilities on the books of Tyco International and Covidien.
        Based on the probability-weighted future cash flows related to the unresolved tax matters, the Company, under the Tax Sharing Agreement, faces a maximum potential liability of $3 billion, based on undiscounted estimates and interest and penalties used to determine the fair value of the FIN 45 guarantee and an assumption of 100% default on the parts of Tyco International and Covidien, a likelihood that management believes to be remote. In the event that the Company is required, due to bankruptcy or other business interruption on the part of Tyco International or Covidien, to pay more than the contractually determined 31%, the Company retains the right to seek payment from the effected entity.
        At Separation, the probability-weighted cash flows and risk premium resulted in a fair value of the FIN 45 liability of $338 million. During the fourth quarter of fiscal 2007, a review of tax reserves held by the Company, Tyco International, and Covidien resulted in approximately $134 million of tax reserves on the books of Tyco International and Covidien being transferred to the Company. As a result of recording those liabilities, the Company re-assessed its FIN 45 liability and decreased it by $42 million to $296 million. The total liability of $296 million under FIN 45 consists of two components. The first component is a SFAS No. 5, " Accounting for Contingencies ," liability that represents the asserted liabilities that either Tyco International or Covidien have determined to be probable and estimable totaling $198 million. The remaining $98 million represents the fair value of the 31% indemnification made to Tyco International and Covidien under the Tax Sharing Agreement. The initial liability at Separation and the transfer made in the fourth quarter of fiscal 2007 were reflected as adjustments to contributed surplus on the Consolidated Balance Sheets.
        Upon Separation, the Company assumed $930 million of contingent tax liabilities from Tyco International which was recorded in income taxes on the Consolidated Balance Sheet. Under the Tax Sharing Agreement, these liabilities, coupled with pre-existing tax liabilities, resulted in the Company recording a receivable of $675 million from Tyco International and Covidien to reflect the 69% indemnification granted by each, which was recorded in receivable from Tyco International Ltd. and Covidien Ltd. on the Consolidated Balance Sheet upon Separation. During the fourth quarter of fiscal 2007, in conjunction with the review of tax reserves discussed in the above paragraph, the Company assumed an additional $161 million in tax reserves, of which $27 million represents accrued interest, resulting in total income tax liabilities assumed as a result of Separation of $1,091 million, which is recorded in income taxes on the Consolidated Balance Sheets. As a result of assuming these liabilities, the Company has recorded a receivable from Tyco International and Covidien in the amount of $844 million on the Consolidated Balance Sheet.
        In disposing of assets or businesses, the Company often provides representations, warranties, and/or indemnities to cover various risks including, for example, unknown damage to the assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. The Company does not have the ability to estimate the potential liability from such indemnities because they relate to unknown conditions.
105

However, the Company has no reason to believe that these uncertainties would have a material adverse effect on the Company's financial position, results of operations, or cash flows.
        In the normal course of business, the Company is liable for contract completion and product performance. In the opinion of management, such obligations will not significantly affect the Company's financial position, results of operations, or cash flows.
        The Company generally records estimated product warranty costs at the time of sale. For further information on estimated product warranty see Note 2.
        The changes in the Company's warranty liability for fiscal 2007 and 2006 are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	(in millions)
	 	
Balance at beginning of fiscal year	 	$	27	 	$	38	 	
Warranties issued during the fiscal year	 	 	6	 	 	3	 	
Warranty expirations and changes in estimate	 	 	(2	)	 	(9	)	
Settlements	 	 	(5	)	 	(5	)	
 	 		 		 	
Balance at end of fiscal year	 	$	26	 	$	27	 	
 	 		 		 	
14. Financial Instruments
        The Company's financial instruments consist primarily of cash and cash equivalents, accounts receivable, investments, accounts payable, debt, and derivative financial instruments. The fair value of cash and cash equivalents, accounts receivable, investments, accounts payable, external debt, and derivative financial instruments approximated book value at fiscal year end 2007 and 2006. See Note 12 for the fair value estimates of external debt.
        To the extent that Tyco International entered into hedges on behalf of the Company prior to Separation, the statement of operations effects of those hedges have been allocated to the Company as part of the Tyco International general corporate overhead expense allocation or interest expense allocation as appropriate. See Note 17.
        The cash flows related to derivative financial instruments are reported in the operating activities section of the Consolidated and Combined Statements of Cash Flow.
Foreign Exchange Risks
        As permitted under the Company's risk management program and policies, the Company uses derivative and non-derivative financial instruments to manage certain exposures to foreign currency risks.
        As part of managing the exposure to changes in foreign currency exchange rates, the Company utilizes foreign exchange forwards and swaps. The objective of these contracts is to minimize impacts to cash flows and profitability due to changes in foreign currency exchange rates on intercompany transactions, accounts receivable, accounts payable, and forecasted cash transactions. These contracts are marked to market with changes in the derivatives fair value recognized currently in earnings in selling, general, and administrative expenses in the Consolidated and Combined Statements of Operations. At fiscal year end 2007, the Company had net liabilities of $8 million on the Consolidated Balance Sheet related to these transactions.
106

        The Company centrally manages the cash of most of its subsidiaries. To convert foreign currency cash flows in a cost effective manner, the Company enters into currency swaps and foreign exchange forwards. The terms of these instruments are generally less than one year. The changes in the fair values of these contracts and of the underlying hedged exposures are largely offsetting and are recorded in selling, general, and administrative expenses in the Consolidated and Combined Statements of Operations.
Interest Rate Risk Management
        The Company issues debt, from time to time, in capital markets to fund its operations. Such borrowings can result in interest rate and/or currency exposure. To manage these exposures and to minimize overall interest cost, the Company has used and may use in the future interest rate swaps to convert a portion of its fixed-rate debt into variable rate debt (fair value hedges) and/or convert a portion of its variable rate debt into fixed rate debt (cash flow hedges). At the end of September 28, 2007, the Company had no outstanding interest rate swaps.
        During fiscal 2007, in anticipation of issuing new fixed rate debt, the Company entered into, and concurrent with the Company's fixed rate debt issuance, terminated, forward starting interest rate swaps to hedge the variability in interest expense that would result from changes in interest rates between the date of the swap and the Company's anticipated date of issuing fixed rate debt. These forward starting interest rate swaps were designated as effective hedges of the probable interest payments under SFAS No. 133. Upon the issuance of the Company's new debt, these swaps were terminated for a cash payment of $54 million. The effective portion of these swaps of $53 million was recorded in other comprehensive income and will be recognized in earnings as interest expense over the remaining term of the related debt instruments. The ineffective portion of $1 million was recorded as interest expense in the Consolidated and Combined Financial Statements.
Hedge of Net Investment
        The Company hedges its net investments in certain foreign operations using intercompany non-derivative financial instruments denominated in the same currencies. The aggregate notional value of these hedges was $3.7 billion at September 28, 2007. As a result of the hedges of net investment, $118 million of foreign exchange loss was reclassified to cumulative translation adjustment, a component of other comprehensive income, for the fiscal year ended September 28, 2007. The Company did not hedge net investments in foreign operations during fiscal 2006 or fiscal 2005.
        The Company's derivative financial instruments present certain market and counterparty risks; however, concentration of counterparty risk is mitigated as the Company deals with a variety of major banks worldwide with long-term Standard & Poor's and Moody's credit ratings of A/A2 or higher. In addition, only conventional derivative financial instruments are utilized, thereby affording optimum clarity as to the determination of the market risk. None of the Company's derivative financial instruments outstanding at year end would result in a significant loss to the Company if a counterparty failed to perform according to the terms of its agreement. At this time, the Company does not require collateral or other security to be furnished by the counterparties to its derivative financial instruments.
107

15. Retirement Plans
Measurement Date
        In fiscal 2005, the Company changed the measurement date for its pension and postretirement benefit plans from September 30th to August 31st, effective October 1, 2004. The Company believes that the one-month change of measurement date was a preferable change as it allows management adequate time to evaluate and report the actuarial information in the Consolidated and Combined Financial Statements under the accelerated reporting deadlines. Accordingly, all amounts presented as of and for the fiscal years ended 2006 and 2005 reflect an August 31st measurement date, while prior years reflect a September 30th measurement date. The Company has accounted for the change in measurement date as a change in accounting principle. The cumulative effect of the accounting principle change as of the beginning of fiscal 2005 was an $11 million after-tax, $13 million pre-tax, gain. The change in measurement date did not have a material effect on net periodic benefit costs.
Adoption of SFAS No. 158
        As disclosed in Note 2, the Company adopted the funded status recognition provisions of SFAS No. 158 effective September 28, 2007. The following table summarizes the impact of the adoption of SFAS No. 158 on the Consolidated Balance Sheet at September 28, 2007:

 	 	Prior to SFAS
No. 158
Adoption
	 	Impact of SFAS
No. 158
Adoption
	 	After SFAS
No. 158
Adoption
	
 	 	(in millions)
	
Assets:	 	 	 	 	 	 	 	 	 	
 	Current deferred income tax assets	 	$	320	 	$	5	 	$	325	
 	Other assets	 	 	283	 	 	55	 	 	338	
 	Non-current deferred income tax assets	 	 	1,274	 	 	123	 	 	1,397	
 	 		 		 		
 	 	Total Assets	 	$	23,505	 	$	183	 	$	23,688	
 	 		 		 		
Liabilities and Equity:	 	 	 	 	 	 	 	 	 	
 	Accrued and other current liabilities	 	$	1,434	 	$	16	 	$	1,450	
 	Non-current deferred tax liabilities	 	 	265	 	 	6	 	 	271	
 	Long-term pension and postretirement liabilities	 	 	221	 	 	386	 	 	607	
 	Accumulated other comprehensive income	 	 	1,277	 	 	(225	)	 	1,052	
 	 		 		 		
 	 	Total Liabilities and Equity	 	$	23,505	 	$	183	 	$	23,688	
 	 		 		 		
        The amounts recognized in accumulated other comprehensive income as of September 28, 2007 were as follows:

 	 	U.S. Defined
Benefit
Pension Plans
	 	Non-U.S.
Defined
Benefit
Pension Plans
	 	Other
Postretirement
Benefit Plans
	
 	 	(in millions)
	
Prior service (credit) cost	 	$	—	 	$	(18	)	$	2	
Net loss	 	 	170	 	 	240	 	 	—	
 	 		 		 		
Total	 	$	170	 	$	222	 	$	2	
 	 		 		 		
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        The amounts in accumulated other comprehensive income as of September 28, 2007 that are expected to be recognized as components of net periodic benefit cost (credit) during fiscal 2008 were as follows:

 	 	U.S Defined
Benefit
Pension Plans
	 	Non-U.S
Defined
Benefit
Pension Plans
	 	Other
Postretirement
Benefit Plans
	
 	 	(in millions)
	
Prior service credit	 	$	—	 	$	(2	)	$	—	
Net loss	 	 	7	 	 	8	 	 	—	
 	 		 		 		
Total	 	$	7	 	$	6	 	$	—	
 	 		 		 		
Defined Benefit Pension Plans
        Prior to Separation, the Company participated through its former parent, Tyco International, in a number of contributory and noncontributory defined benefit retirement plans. Subsequent to Separation, the Company assumed sponsorship of those plans, covering certain of its U.S. and non-U.S. employees, designed in accordance with local custom and practice. Net periodic pension benefit cost is based on periodic actuarial valuations which use the projected unit credit method of calculation and is charged to the Consolidated and Combined Statements of Operations on a systematic basis over the expected average remaining service lives of current participants. Contribution amounts are determined based on the advice of professionally qualified actuaries in the countries concerned. The benefits under the defined benefit plans are based on various factors, such as years of service and compensation.
        Prior to Separation, the Company participated through its former parent in one co-mingled plan that included plan participants of other Tyco International subsidiaries. The Company recorded its portion of the co-mingled plan's expense and the related obligation, which has been actuarially determined based on the Company's specific benefit formulas by participants and allocated plan assets. The contribution amounts were determined in total for the co-mingled plan and allocated to the Company based on headcount. Management believes such allocations were reasonable. In fiscal 2007, this plan was legally separated, resulting in a reallocation of assets based on the Employee Retirement Income Security Act ("ERISA") prescribed calculation which will result in adjustments to the components of the net amount recognized and future expense.
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        The net periodic benefit (credit) cost for all U.S. and non-U.S. defined benefit pension plans in fiscal 2007, 2006, and 2005 was as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	 	
 	 	Fiscal
	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Service cost	 	$	5	 	$	4	 	$	4	 	$	60	 	$	62	 	$	54	 	
Interest cost	 	 	55	 	 	50	 	 	52	 	 	70	 	 	60	 	 	61	 	
Expected return on plan assets	 	 	(74	)	 	(72	)	 	(65	)	 	(60	)	 	(51	)	 	(45	)	
Amortization of prior service cost	 	 	—	 	 	—	 	 	—	 	 	(2	)	 	(2	)	 	—	 	
Amortization of net actuarial loss	 	 	13	 	 	15	 	 	12	 	 	20	 	 	24	 	 	21	 	
Curtailment/settlement gain and special termination benefits	 	 	(10	)	 	—	 	 	—	 	 	(1	)	 	—	 	 	(6	)	
 	 		 		 		 		 		 		 	
Net periodic benefit (credit) cost	 	$	(11	)	$	(3	)	$	3	 	$	87	 	$	93	 	$	85	 	
 	 		 		 		 		 		 		 	
Weighted average assumptions used to determine net pension cost during the period:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Discount rate	 	 	6.00	%	 	5.25	%	 	6.00	%	 	4.15	%	 	3.85	%	 	4.52	%	
Expected return on plan assets	 	 	7.99	%	 	7.99	%	 	7.99	%	 	5.73	%	 	5.76	%	 	6.12	%	
Rate of compensation increase	 	 	4.00	%	 	4.00	%	 	4.25	%	 	3.19	%	 	3.06	%	 	3.37	%	
        The following table represents the changes in benefit obligations, plan assets, and the net amount recognized on the Consolidated and Combined Balance Sheets for all U.S. and non-U.S. defined benefit plans at fiscal year end 2007 and 2006:

 	 	U.S. Plans
	 	Non-U.S. Plans
	 	
 	 	Fiscal
	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2007
	 	2006
	 	
 	 	($ in millions)
	 	
Change in benefit obligations:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Benefit obligation at end of prior period	 	$	947	 	$	988	 	$	1,662	 	$	1,583	 	
Service cost	 	 	5	 	 	4	 	 	60	 	 	62	 	
Interest cost	 	 	55	 	 	50	 	 	70	 	 	60	 	
Employee contributions	 	 	—	 	 	—	 	 	6	 	 	5	 	
Plan amendments	 	 	—	 	 	—	 	 	3	 	 	(19	)	
Actuarial gain	 	 	(34	)	 	(44	)	 	(126	)	 	(42	)	
Benefits and administrative expenses paid	 	 	(51	)	 	(51	)	 	(60	)	 	(47	)	
(Divestitures) new plans	 	 	(4	)	 	—	 	 	31	 	 	—	 	
Curtailment/settlement gain and special termination benefits	 	 	—	 	 	—	 	 	(6	)	 	—	 	
Currency translation	 	 	—	 	 	—	 	 	118	 	 	60	 	
 	 		 		 		 		 	
Benefit obligation at end of period	 	$	918	 	$	947	 	$	1,758	 	$	1,662	 	

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Change in plan assets:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Fair value of plan assets at end of prior period	 	$	951	 	$	928	 	$	1,002	 	$	870	 	
Actual return on plan assets	 	 	114	 	 	73	 	 	94	 	 	81	 	
Employer contributions	 	 	1	 	 	1	 	 	68	 	 	53	 	
Employee contributions	 	 	—	 	 	—	 	 	6	 	 	5	 	
(Divestitures) new plans	 	 	(51	)	 	—	 	 	16	 	 	—	 	
Benefits and administrative expenses paid	 	 	(51	)	 	(51	)	 	(60	)	 	(47	)	
Curtailment/settlement gain and special termination benefits	 	 	—	 	 	—	 	 	(6	)	 	—	 	
Currency translation	 	 	—	 	 	—	 	 	74	 	 	40	 	
 	 		 		 		 		 	
Fair value of plan assets at end of period	 	$	964	 	$	951	 	$	1,194	 	$	1,002	 	

Funded status	
 	
$	
46	
 	
$	
4	
 	
$	
(564	
)	
$	
(660	
)	
Contributions after the measurement date	 	 	—	 	 	—	 	 	11	 	 	14	 	
Unrecognized net actuarial loss	 	 	—	 	 	200	 	 	—	 	 	399	 	
Unrecognized prior service cost (credit)	 	 	—	 	 	1	 	 	—	 	 	(21	)	
 	 		 		 		 		 	
Net amount recognized	 	$	46	 	$	205	 	$	(553	)	$	(268	)	
 	 		 		 		 		 	
Amounts recognized on the Consolidated and Combined Balance Sheets:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Intangible asset	 	$	—	 	$	1	 	$	—	 	$	—	 	
Other assets	 	 	63	 	 	4	 	 	14	 	 	19	 	
Accrued and other current liabilities	 	 	(3	)	 	—	 	 	(8	)	 	—	 	
Long-term pension and postretirement liabilities	 	 	(14	)	 	—	 	 	(559	)	 	(453	)	
Additional minimum liability	 	 	—	 	 	200	 	 	—	 	 	166	 	
 	 		 		 		 		 	
Net amount recognized	 	$	46	 	$	205	 	$	(553	)	$	(268	)	
 	 		 		 		 		 	
Weighted average assumptions used to determine pension benefit obligations at period end:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Discount rate	 	 	6.35	%	 	6.00	%	 	4.70	%	 	4.15	%	
Rate of compensation increase	 	 	4.00	%	 	4.00	%	 	3.45	%	 	3.19	%	
        In determining the expected return on plan assets, the Company considers the relative weighting of plan assets by class and individual asset class performance expectations as provided by their external advisors.
        The investment strategy for the U.S. pension plans has been governed by the Company's Investment Committee; investment strategies for non-U.S. pension plans are governed locally. The Company's investment strategy for its pension plans is to manage the plans on a going concern basis. Current investment policy is to achieve a reasonable return on assets, subject to a prudent level of portfolio risk, for the purpose of enhancing the security of benefits for participants.
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        Target weighted-average asset allocations and weighted average asset allocations for U.S. and non-U.S. pension plans at fiscal year end 2007 and 2006 were as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	 	
 	 	Target
	 	Fiscal
2007
	 	Fiscal
2006
	 	Target
	 	Fiscal
2007
	 	Fiscal
2006
	 	
Asset Category:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity securities	 	60	%	59	%	52	%	52	%	52	%	52	%	
Debt securities	 	40	 	39	 	41	 	39	 	39	 	39	 	
Real estate	 	—	 	—	 	3	 	3	 	3	 	3	 	
Cash and cash equivalents	 	—	 	2	 	4	 	6	 	6	 	6	 	
 	 		 		 		 		 		 		 	
Total	 	100	%	100	%	100	%	100	%	100	%	100	%	
 	 		 		 		 		 		 		 	
        Tyco Electronics' common shares are not a direct investment of the Company's pension funds; however, the pension funds may indirectly include Tyco Electronics shares. The aggregate amount of the Tyco Electronics common shares would not be considered material relative to the total pension fund assets.
        The Company's funding policy is to make contributions in accordance with the laws and customs of the various countries in which it operates as well as to make discretionary voluntary contributions from time-to-time. The Company anticipates that, at a minimum, it will make the minimum required contributions to its pension plans in fiscal 2008 of $4 million for U.S. plans and $66 million for non-U.S. plans.
        Benefit payments, which reflect future expected service, as appropriate, are expected to be paid as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	
 	 	(in millions)
	
Fiscal 2008	 	$	55	 	$	55	
Fiscal 2009	 	 	54	 	 	57	
Fiscal 2010	 	 	58	 	 	62	
Fiscal 2011	 	 	58	 	 	66	
Fiscal 2012	 	 	62	 	 	67	
Fiscal 2013-2017	 	 	328	 	 	398	
        The accumulated benefit obligation for all U.S. and non-U.S. plans as of fiscal year end 2007 and 2006 was as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	
 	 	Fiscal
	 	Fiscal
	
 	 	2007
	 	2006
	 	2007
	 	2006
	
 	 	(in millions)
	
Accumulated benefit obligation	 	$	915	 	$	944	 	$	1,503	 	$	1,413	
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        The accumulated benefit obligation and fair value of plan assets for U.S. and non-U.S. pension plans with accumulated benefit obligations in excess of plan assets at fiscal year end 2007 and 2006 were as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	
 	 	Fiscal
	 	Fiscal
	
 	 	2007
	 	2006
	 	2007
	 	2006
	
 	 	(in millions)
	
Accumulated benefit obligation	 	$	19	 	$	88	 	$	754	 	$	1,334	
Fair value of plan assets	 	 	4	 	 	59	 	 	386	 	 	900	
        The projected benefit obligation and fair value of plan assets for U.S. and non-U.S. pension plans with projected benefit obligations in excess of plan assets at fiscal year end 2007 and 2006 were as follows:

 	 	U.S. Plans
	 	Non-U.S. Plans
	
 	 	Fiscal
	 	Fiscal
	
 	 	2007
	 	2006
	 	2007
	 	2006
	
 	 	(in millions)
	
Projected benefit obligation	 	$	22	 	$	90	 	$	1,667	 	$	1,589	
Fair value of plan assets	 	 	4	 	 	59	 	 	1,088	 	 	926	
Defined Contribution Retirement Plans
        The Company maintains several defined contribution retirement plans, which include 401(k) matching programs, as well as qualified and nonqualified profit sharing and share bonus retirement plans. Expense for the defined contribution plans is computed as a percentage of participants' compensation and was $72 million, $69 million, and $68 million for fiscal 2007, 2006, and 2005, respectively.
Deferred Compensation Plans
        The Company maintains nonqualified deferred compensation plans, which permit eligible employees to defer a portion of their compensation. A record keeping account is set up for each participant and the participant chooses from a variety of measurement funds for the deemed investment of their accounts. The measurement funds correspond to a number of funds in Tyco Electronics' 401(k) plans and the account balance fluctuates with the investment returns on those funds. Total deferred compensation liabilities were $37 million and $27 million at fiscal year end 2007 and 2006, respectively. Deferred compensation expense was immaterial in all years presented.
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Rabbi Trusts
        The Company has established rabbi trusts, related to certain acquired companies, through which the assets may be used to pay non-qualified plan benefits. The trusts primarily hold bonds. The rabbi trust assets are subject to the claims of the Company's creditors in the event of the Company's insolvency. The value of the assets held by these trusts, included in Other assets on the Consolidated and Combined Balance Sheets, was $89 million and $87 million at fiscal year end 2007 and 2006, respectively. Total liabilities related to the assets held by the rabbi trust and reflected on the Consolidated and Combined Balance Sheet were $25 million and $28 million at fiscal year end 2007 and 2006, respectively. Plan participants are general creditors of the Company with respect to these benefits.
Postretirement Benefit Plans
        In addition to providing pension and 401(k) benefits, the Company also provides certain health care coverage continuation for qualifying retirees from date of retirement to age 65.
        Net periodic postretirement benefit cost in fiscal 2007, 2006, and 2005 was as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	($ in millions)
	 	
Service cost	 	$	1	 	$	1	 	$	1	 	
Interest cost	 	 	3	 	 	2	 	 	3	 	
Amortization of prior service credit	 	 	—	 	 	—	 	 	(1	)	
Curtailment/settlement gain and special termination benefits	 	 	(3	)	 	—	 	 	—	 	
 	 		 		 		 	
Net periodic postretirement benefit cost	 	$	1	 	$	3	 	$	3	 	
 	 		 		 		 	
Weighted average assumptions used to determine net postretirement benefit cost during the period:	 	 	 	 	 	 	 	 	 	 	
Discount rate	 	 	5.75	%	 	4.75	%	 	5.50	%	
Rate of compensation increase	 	 	4.00	%	 	4.00	%	 	4.25	%	
        The components of the accrued postretirement benefit obligations, substantially all of which are unfunded, at fiscal year end 2007 and 2006, were as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	($ in millions)
	 	
Change in benefit obligations:	 	 	 	 	 	 	 	
Benefit obligation at beginning of period	 	$	49	 	$	57	 	
Service cost	 	 	1	 	 	1	 	
Interest cost	 	 	3	 	 	2	 	
Actuarial gain	 	 	(7	)	 	(4	)	
Benefits paid	 	 	(5	)	 	(7	)	
 	 		 		 	
Benefit obligation at end of period	 	$	41	 	$	49	 	
 	 		 		 	
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Change in plan assets:	

 	

 	
 	
Fair value of assets at beginning of period	 	$	4	 	$	4	 	
Employer contributions	 	 	5	 	 	7	 	
Benefits paid	 	 	(5	)	 	(7	)	
 	 		 		 	
Fair value of plan assets at end of period	 	$	4	 	$	4	 	

Funded status	
 	
$	
(37	
)	
$	
(45	
)	
Unrecognized net actuarial loss	 	 	—	 	 	5	 	
Unrecognized prior service cost	 	 	—	 	 	2	 	
 	 		 		 	
Accrued postretirement benefit cost	 	$	(37	)	$	(38	)	

Amounts recognized on the Consolidated and Combined Balance Sheets:	

 	

 	
 	
Accrued and other postretirement liabilities	 	$	(3	)	$	—	 	
Long-term pension and postretirement liabilities	 	 	(34	)	 	(38	)	
 	 		 		 	
Net amount recognized	 	$	(37	)	$	(38	)	

Weighted average assumptions used to determine postretirement benefit obligations at period end:	

 	

 	
 	
Discount rate	 	 	6.35	%	 	5.75	%	
Rate of compensation increase	 	 	4.00	%	 	4.00	%	
        The Company expects to make contributions to its postretirement benefit plans of $3 million in fiscal 2008.
        Benefit payments, including those amounts to be paid out of corporate assets and reflecting future expected service as appropriate, are expected to be paid as follows:

 	 	(in millions)
	
Fiscal 2008	 	$	4	
Fiscal 2009	 	 	3	
Fiscal 2010	 	 	3	
Fiscal 2011	 	 	3	
Fiscal 2012	 	 	3	
Fiscal 2013-2017	 	 	15	
        Health care cost trend assumptions are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
Health care cost trend rate assumed for next fiscal year	 	10.18	%	9.79	%	
Rate to which the cost trend rate is assumed to decline	 	5.00	%	5.00	%	
Fiscal year the ultimate trend rate is achieved	 	2013	 	2013	 	
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        A one-percentage point change in assumed healthcare cost trend rates would have the following effects:

 	 	1 Percentage Point
Increase
	 	1 Percentage Point
Decrease
	 	
 	 	(in millions)
	 	
Effect on total of service and interest cost	 	$	—	 	$	—	 	
Effect on postretirement benefit obligation	 	 	3	 	 	(3	)	
16. Commitments and Contingencies
        The Company has facility, land, vehicle, and equipment leases that expire at various dates through the year 2056. Rental expense under these leases was $179 million, $167 million, and $193 million for fiscal 2007, 2006, and 2005, respectively. At fiscal year end 2007, the minimum lease payment obligations under non-cancelable lease obligations were as follows:

 	 	(in millions)
	
Fiscal 2008	 	$	129	
Fiscal 2009	 	 	101	
Fiscal 2010	 	 	81	
Fiscal 2011	 	 	61	
Fiscal 2012	 	 	46	
Thereafter	 	 	194	
 	 		
Total	 	$	612	
 	 		
        The Company also has purchase obligations related to commitments to purchase certain goods and services. At fiscal year end 2007, the Company had commitments to spend $93 million in fiscal 2008.
        At fiscal year end 2007, the Company also had a contingent purchase price commitment of $80 million related to the fiscal 2001 acquisition of Com-Net by the Wireless Systems segment. This represents the maximum amount payable to the former shareholders of Com-Net only after the construction and installation of a communications system for the State of Florida is finished and the State has approved the system based on the guidelines set forth in the contract. A liability for this contingency has not been recorded in the Company's Consolidated and Combined Financial Statements as the outcome of this contingency currently is not estimable.
        In the normal course of business, the Company is liable for contract completion and product performance. In the opinion of management, such obligations will not significantly affect the Company's financial position, results of operations, or cash flows.
        As a part of the Separation and Distribution Agreement entered into upon Separation, any existing or potential liabilities related to Tyco International's outstanding litigation were assigned to the Company if Tyco Electronics was specifically identified in the lawsuit. However, any existing or potential liabilities that could not be associated with Tyco Electronics were allocated appropriately and post-separation sharing agreements were established. See "Part I. Item 3. Legal Proceedings" for a description of Tyco International's various significant outstanding litigation proceedings. Tyco Electronics will be responsible for certain potential liabilities that may arise upon the settlement of the pending litigation based on the post-separation sharing agreement. If Tyco International or Covidien
116

were to default on their obligation to pay their allocated share of these liabilities, however, the Company would be required to pay additional amounts.
Class Actions
        As a result of actions taken by certain of Tyco International's former senior corporate management, Tyco International, some members of Tyco International's former senior corporate management, former members of Tyco International's board of directors, Tyco International's former General Counsels and former Chief Financial Officer, and Tyco International's current Chief Executive Officer are named defendants in a number of purported class actions alleging violations of the disclosure provisions of the federal securities laws. Tyco International, certain of its current and former employees, some members of its former senior corporate management, and some former members of its board of directors also are named as defendants in several ERISA class actions. Tyco International is generally obligated to indemnify its directors and officers and its former directors and officers who are named as defendants in some or all of these matters to the extent required by Bermuda law. In addition, Tyco International's insurance carriers may decline coverage, or Tyco International's coverage may be insufficient to cover its expenses and liability, in some or all of these matters.
        On May 14, 2007, Tyco International entered into a memorandum of understanding with plaintiffs' counsel in connection with the settlement of 32 purported securities class action lawsuits. The memorandum of understanding does not resolve all securities cases, and several remain outstanding. In addition, the proposed settlement does not release claims arising under ERISA.
        Under the terms of the memorandum of understanding, the plaintiffs agreed to release all claims against Tyco International, the other settling defendants, and ten other individuals in consideration for the payment of $2,975 million from Tyco International to the certified class and assignment to the class of any net recovery of any claims possessed by Tyco International and the other settling defendants against Tyco International's former auditor, PricewaterhouseCoopers. Defendant PricewaterhouseCoopers was not a settling defendant and is not a party to the memorandum. However, PricewaterhouseCoopers subsequently agreed to participate in the settlement as a settling defendant, and in consideration of a release of all claims against it by the parties to the memorandum of understanding, agreed to make a payment of $225 million. Tyco International and the other settling defendants have denied and continue to deny any wrongdoing and legal liability arising from any of the facts or conduct alleged in the actions. The parties to the memorandum of understanding applied to the court for approval of the settlement agreement. On July 13, 2007, the court granted preliminary approval of the settlement. On November 2, 2007, the final fairness hearing for the class settlement was held, and the court indicated it would approve the settlement and stated a formal ruling would be issued shortly. If the settlement agreement does not receive final court approval, the memorandum of understanding will be null and void. By December 28, 2007, class participants must file their proofs of claim demonstrating their right to recovery under the class settlement.
        Under the terms of the Separation and Distribution Agreement that was entered into in connection with the Separation, Tyco International, Covidien, and the Company are jointly and severally liable for the full amount of the class action settlement. Additionally, under the Separation and Distribution Agreement, the companies share in the liability and related escrow account with Tyco International assuming 27%, Covidien 42%, and Tyco Electronics 31% of the total settlement amount.
        In the third quarter of fiscal 2007, the Company was allocated a charge from Tyco International of $922 million, for which no tax benefit was available. In addition, in fiscal 2007, the Company was
117

allocated $35 million of income relating to Tyco International's expected recovery of certain costs from insurers, of which $31 million has been collected. The net charge of $887 million has been recorded on the Consolidated and Combined Statement of Operations as allocated class action settlement costs, net. The portions allocated to the Company are consistent with the sharing percentage included in the Separation and Distribution Agreement. Tyco International placed funds in escrow for the benefit of the class. The escrow account earns interest that is payable to the class. In addition, interest is accrued on the class action settlement liability. At fiscal year end 2007, the Company recorded $928 million on the Consolidated Balance Sheet for its portion of the escrow. In addition, the Company recorded a $2,992 million liability and a $2,064 million receivable from Tyco International and Covidien for their portion of the liability at fiscal year end 2007.
        If the proposed settlement were not consummated on the agreed terms or if the unresolved proceedings were to be determined adversely to Tyco International, the Company's share of any additional potential losses, which are not presently estimable, may have a material adverse effect on the Company's financial position, results of operations, or cash flows.
Investigations
        Tyco International and others have received various subpoenas and requests from the SEC's Division of Enforcement, the U.S. Department of Labor, the General Service Administration, and others seeking the production of voluminous documents in connection with various investigations into Tyco International's governance, management, operations, accounting, and related controls. The Department of Labor is investigating Tyco International and the administrators of certain of its benefit plans. Tyco International has advised the Company that it cannot predict when these investigations will be completed, nor can it predict what the results of these investigations may be. It is possible that Tyco International will be required to pay material fines or suffer other penalties. It is not possible to estimate the amount of loss, or range of possible loss, if any, that might result from an adverse resolution of these matters. As a result, Tyco Electronics share of such potential losses also is not estimable and may have a material adverse effect on its financial position, results of operations, or cash flows.
Compliance Matters
        Tyco International has received and responded to various allegations that certain improper payments were made by Tyco International subsidiaries, including Tyco Electronics subsidiaries, in recent years. During 2005 and 2006, Tyco International reported to the U.S. Department of Justice ("DOJ") and the SEC the investigative steps and remedial measures that it had taken in response to the allegations. Tyco International also informed the DOJ and the SEC that it retained outside counsel to perform a company-wide baseline review of its policies, controls, and practices with respect to compliance with the Foreign Corrupt Practices Act ("FCPA"), that it would continue to make periodic progress reports to these agencies, and that it would present its factual findings upon conclusion of the baseline review. Tyco International and Tyco Electronics have had communications with the DOJ and SEC to provide updates on the baseline review being conducted by outside counsel, including, as appropriate, briefings concerning additional instances of potential improper payments identified by Tyco International and the Company in the course of the Company's ongoing compliance activities. To date, the baseline review has revealed that some business practices may not comply with Tyco International and FCPA requirements. At this time, the Company cannot predict the outcome of other allegations reported to regulatory and law enforcement authorities and therefore cannot estimate the range of
118

potential loss or extent of risk, if any, that may result from an adverse resolution of any or all of these matters. However, it is possible that the Company may be required to pay judgments, suffer penalties, or incur settlements in amounts that may have a material adverse effect on its financial position, results of operations, or cash flows. Any judgment, settlement, or other cost incurred by Tyco International in connection with these matters would be subject to the liability sharing provisions of the Separation and Distribution Agreement, which provides that any liabilities not primarily related to any of the businesses of Tyco International, Covidien, or Tyco Electronics will be shared equally among the companies.
Intellectual Property and Antitrust Litigation
        The Company is a party to a number of patent infringement and antitrust actions that may require the Company to pay damage awards. The Company has assessed the status of these matters and has recorded liabilities related to certain of these matters where appropriate.
Environmental Matters
        The Company is involved in various stages of investigation and cleanup related to environmental remediation matters at a number of sites. The ultimate cost of site cleanup is difficult to predict given the uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations, and alternative cleanup methods. As of fiscal year end 2007, the Company concluded that it was probable that it would incur remedial costs in the range of approximately $12 million to $23 million. As of fiscal year end 2007, the Company concluded that the best estimate within this range is approximately $16 million, of which $3 million is included in accrued and other current liabilities and $13 million is included in other liabilities on the Consolidated Balance Sheet. In view of the Company's financial position and reserves for environmental matters of $16 million, the Company believes that any potential payment of such estimated amounts will not have a material adverse effect on its financial position, results of operations, or cash flows.
Income Taxes
        The Company and its subsidiaries' income tax returns are periodically examined by various tax authorities. In connection with these examinations, tax authorities, including the Internal Revenue Service ("IRS"), have raised issues and proposed tax adjustments. The Company and Tyco International are reviewing and contesting certain of the proposed tax adjustments. Amounts related to these tax adjustments and other tax contingencies and related interest that management has assessed as probable and estimable and which relate specifically to the Tyco Electronics business have been recorded in the Company's Consolidated and Combined Financial Statements. In addition, the Company may be required to pay additional taxes for contingencies not related to the electronics businesses as a result of the tax liability sharing arrangements with Tyco International and Covidien entered into upon Separation.
        In fiscal 2004, in connection with the IRS audit of the fiscal 1997 through 2000 years, Tyco International submitted to the IRS proposed adjustments to these prior period U.S. federal income tax returns resulting in a reduction in the taxable income previously filed. During fiscal 2006, the IRS accepted substantially all of the proposed adjustments. Also during fiscal 2006, Tyco International developed proposed amendments to U.S. federal income tax returns for additional periods through fiscal 2002. On the basis of previously accepted amendments, the Company has determined that
119

acceptance of these adjustments is probable and, accordingly, has recorded them, as well as the impacts of the adjustments accepted by the IRS, in the Consolidated and Combined Financial Statements. These adjustments resulted in a $205 million net decrease in deferred income tax assets and a $205 million decrease in income taxes in fiscal 2006. Such adjustments did not have a material impact on the Company's results of operations or cash flows.
        During the fourth quarter of fiscal 2007, Tyco International completed proposed amendments to a portion of its U.S. federal income tax returns for the 2001 through 2005 fiscal periods, which primarily reflected the roll forward of the previous amendments for the 1997 to 2002 fiscal periods. These adjustments resulted in a $9 million increase to the tax provision on the Company's Consolidated and Combined Financial Statements in fiscal 2007. Tyco International continues to complete proposed adjustments to the remainder of its U.S. federal income tax returns for periods subsequent to fiscal 2002. When the Company's tax return positions are updated, additional adjustments may be identified and recorded in the Consolidated Financial Statements. While the final adjustments cannot be determined until the income tax return amendment process is completed, the Company believes that any resulting adjustments will not have a material impact on its financial condition, results of operations, or cash flows.
        During the third quarter of fiscal 2007, the IRS concluded its field examination of certain of Tyco International's U.S. federal income tax returns for the years 1997 though 2000 and issued anticipated Revenue Agents' Reports which reflect the IRS' determination of proposed tax adjustments for the periods under audit. The Revenue Agents' Reports propose tax audit adjustments to certain of Tyco International's previously filed tax return positions, all of which Tyco International expected and previously assessed at each balance sheet date. Accordingly, the Company has made no additional provision during fiscal 2007 with respect to its share of the proposed audit adjustments in the Revenue Agents' Reports.
        Tyco International has agreed with the IRS on adjustments totaling $498 million, with an estimated cash impact to Tyco International of $458 million, and during the third quarter of fiscal 2007, Tyco International paid $458 million. The Company's portion of this payment reduced income taxes on the Consolidated Balance Sheet by $163 million. Currently, it is the Company's understanding that Tyco International will appeal other proposed tax audit adjustments totaling approximately $1 billion and intends to vigorously defend its prior filed tax return positions. The Company continues to believe that the amounts recorded in its Consolidated and Combined Financial Statements relating to these tax adjustments are sufficient. However, the ultimate resolution of these matters is uncertain and could result in a material impact to the Company's financial position, results of operations, or cash flows. In addition, ultimate resolution of these matters could result in Tyco International filing amended U.S. federal income tax returns for years subsequent to the current fiscal 1997 to 2000 audit period and could have a material impact on the Company's effective tax rate in future reporting periods.
        Additionally, the IRS proposed civil fraud penalties against Tyco International arising from alleged actions of former executives in connection with certain intercompany transfers of stock in 1998 and 1999. Based on statutory guidelines, the Company estimates the proposed penalties could range between $30 million and $50 million. Any penalty imposed would be subject to sharing with Tyco International and Covidien under the Tax Sharing Agreement. Currently, it is the Company's understanding that Tyco International will vigorously oppose the assertion of any such penalties.
        In connection with the Separation, the Company entered into a Tax Sharing Agreement that generally governs Covidien's, Tyco Electronics' and Tyco International's respective rights,
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responsibilities, and obligations after the distribution with respect to taxes, including ordinary course of business taxes and taxes, if any, incurred as a result of any failure of the distribution of all of the shares of Covidien or Tyco Electronics to qualify as a tax-free distribution for U.S. federal income tax purposes within the meaning of Section 355 of the Internal Revenue Code (the "Code") or certain internal transactions undertaken in anticipation of the spin-offs to qualify for tax-favored treatment under the Code.
        Pursuant to the Separation and Distribution Agreement and Tax Sharing Agreement, upon Separation, the Company has entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. Under these agreements, principally the Tax Sharing Agreement, Tyco International, Covidien, and Tyco Electronics share 27%, 42%, and 31%, respectively, of certain contingent liabilities relating to unresolved tax matters of legacy Tyco International. The effect of the Tax Sharing Agreement is to indemnify the Company for 69% of all liabilities settled by the Company with respect to unresolved legacy tax matters. Pursuant to that indemnification, the Company has made similar indemnifications to Tyco International and Covidien with respect to 31% of all liabilities settled by the companies with respect to unresolved legacy tax matters. If any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, the Company would be responsible for a portion of the defaulting party or parties' obligation.
        Upon Separation, $930 million of Tyco International's contingent tax liabilities related to unresolved tax matters were transferred to the Company in accordance with the Tax Sharing Agreement. In addition, the Company recorded a receivable from Tyco International and Covidien of $675 million on the Consolidated Balance Sheet at June 29, 2007 relating to indemnifications made by Tyco International and Covidien under the Tax Sharing Agreement. During the fourth quarter of fiscal 2007, an analysis of the tax reserves held by the Company, Tyco International, and Covidien indicated that the Company is the primary obligor for an additional $161 million of tax and related interest for which reserves had been recorded on the books of Tyco International and Covidien. Accordingly, the amounts recorded by the Company upon Separation for contingent tax liabilities and the corresponding assets for indemnifications made by Tyco International and Covidien were increased to reflect these additional amounts. The initial liability at Separation and the adjustment made in the fourth quarter of fiscal 2007 were reflected as adjustments to contributed surplus on the Consolidated Balance Sheet.
        The Company's contractual obligation under the Tax Sharing Agreement is 31% of legacy Tyco International contingent tax liabilities, or $675 million. This net obligation is comprised of shared contingent tax liabilities of $1,223 million, adjusted for the contractual obligations among the parties to the Tax Sharing Agreement. These contractual obligations consist of a $844 million receivable from Tyco International and Covidien related to the Company's shared contingent tax liabilities, a $198 million liability applicable to Tyco International and Covidien contingent tax liabilities, and a $98 million liability under FIN 45 related to the estimated fair value of future indemnifications made under the Tax Sharing Agreement. See further discussion in Note 13. The actual amounts that the Company may be required to ultimately accrue or pay under this agreement could vary depending upon the outcome of the unresolved tax matters, which may not be resolved for several years. See Note 17 for additional information regarding the Company's responsibility for contingent tax liabilities.
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Other Matters
        The Company is a defendant in a number of other pending legal proceedings incidental to present and former operations, acquisitions, and dispositions. The Company does not expect the outcome of these proceedings, either individually or in the aggregate, to have a material adverse effect on its financial position, results of operations, or cash flows.
17. Related Party Transactions
Trade Activity
        Prior to Separation, the Company sold certain of its manufactured products consisting primarily of connectors and cable assemblies to Tyco International and its affiliates, at prices which approximated fair value. Sales to Tyco International and its affiliates, which are included in net sales on the Consolidated and Combined Statements of Operations, were $60 million during the first nine months of fiscal 2007 and $76 million in both fiscal 2006 and 2005.
Cash
        During the fourth quarter of fiscal 2007, the Company transferred $27 million of funds to Tyco International to adjust for differences between the Company's cash balance at June 29, 2007 and its final cash balance as determined in accordance with the Separation and Distribution Agreement. This transfer has been recorded as an adjustment to contributed surplus on the Consolidated and Combined Financial Statements.
Debt and Related Items
        The Company was allocated a portion of Tyco International's consolidated debt, net interest expense, and loss on retirement of debt. See Note 12 for further information regarding these allocations.
Allocated Expenses
        In the third quarter of fiscal 2007, the Company was allocated a net charge from Tyco International of $887 million related to the class action settlement. See Note 16 for further information regarding the class action settlement.
        Prior to Separation, the Company was allocated general corporate overhead expenses from Tyco International for corporate-related functions based on a pro-rata percentage of Tyco International's consolidated net revenue. General corporate overhead expenses primarily related to centralized corporate functions, including treasury, tax, legal, internal audit, human resources, and risk management functions. During fiscal 2007, 2006, and 2005, the Company was allocated $152 million, $177 million, and $198 million, respectively, of general corporate overhead expenses incurred by Tyco International, which are included within selling, general, and administrative expenses in the Consolidated and Combined Statements of Operations.
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        As discussed in Note 1, the Company believes the assumptions and methodologies underlying the allocation of general corporate overhead expenses and net class action settlement costs from Tyco International were reasonable. However, such expenses may not be indicative of the actual level of expenses that would have been or will be incurred by the Company if it were to operate as an independent, publicly-traded company. As such, the financial information herein may not necessarily reflect the consolidated and combined financial position, results of operations, and cash flows of the Company in the future or what it would have been had the Company been an independent, publicly-traded company during the periods presented.
Transactions with Tyco Electronics' and Tyco International's Directors
        During fiscal 2007, the Company engaged in commercial transactions in the normal course of business with companies where Tyco Electronics' directors were employed and served as officers. Purchases from such companies aggregated less than one percent of net sales in fiscal 2007. In addition, during periods prior to the Separation in fiscal 2007, 2006, and 2005, the Company engaged in commercial transactions in the normal course of business with companies where Tyco International's directors were employed and served as officers. During each of these periods, Tyco Electronics' purchases from such companies aggregated less than one percent of net sales.
Separation and Distribution Agreement
        Upon Separation, the Company entered into a Separation and Distribution Agreement and other agreements with Tyco International and Covidien to effect the Separation and provide a framework for the Company's relationships with Tyco International and Covidien after the distribution of the Company's and Covidien's shares to Tyco International's shareholders (the "Distribution"). These agreements govern the relationships among Tyco International, Covidien, and the Company subsequent to the Separation and provide for the allocation to the Company and Covidien of certain of Tyco International's assets, liabilities, and obligations attributable to periods prior to the Separation.
        Under the Separation and Distribution Agreement and other agreements, subject to certain exceptions contained in the Tax Sharing Agreement, the Company, Covidien, and Tyco International assumed 31%, 42%, and 27%, respectively, of certain of Tyco International's contingent and other corporate liabilities. All costs and expenses associated with the management of these contingent and other corporate liabilities will be shared equally among the parties. These contingent and other corporate liabilities primarily relate to consolidated securities litigation and any actions with respect to the Separation or the Distribution brought by any third party. If any party responsible for such liabilities were to default in its payment, when due, of any of these assumed obligations, each non-defaulting party would be required to pay equally with any other non-defaulting party the amounts in default. Accordingly, under certain circumstances, Tyco Electronics may be obligated to pay amounts in excess of its agreed-upon share of the assumed obligations related to such contingent and other corporate liabilities, including associated costs and expenses.
Tax Sharing Agreement
        Upon Separation, the Company entered into a Tax Sharing Agreement, under which the Company shares responsibility for certain of its, Tyco International's, and Covidien's income tax liabilities based on a sharing formula for periods prior to and including June 29, 2007. The Company, Covidien, and Tyco International share 31%, 42%, and 27%, respectively, of U.S. income tax liabilities that arise from adjustments made by tax authorities to its, Tyco International's, and Covidien's U.S. income tax returns.
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The effect of the Tax Sharing Agreement is to indemnify the Company for 69% of all liabilities settled by the Company with respect to unresolved legacy tax matters. Pursuant to that indemnification, the Company has made similar indemnifications to Tyco International and Covidien with respect to 31% of all liabilities settled by the companies relating to unresolved legacy tax matters. All costs and expenses associated with the management of these shared tax liabilities shall be shared equally among the parties. The Company will be responsible for all of its own taxes that are not shared pursuant to the Tax Sharing Agreement's sharing formula. In addition, Tyco International and Covidien will be responsible for their tax liabilities that are not subject to the Tax Sharing Agreement's sharing formula.
        All of the tax liabilities of Tyco International that were associated with Tyco International subsidiaries that are included in Tyco Electronics following the Separation became Tyco Electronics' tax liabilities upon Separation. Although Tyco Electronics has agreed to share certain tax liabilities with Tyco International and Covidien pursuant to the Tax Sharing Agreement, Tyco Electronics remains primarily liable for all of these liabilities. If Tyco International and Covidien default on their obligations to Tyco Electronics under the Tax Sharing Agreement, Tyco Electronics would be liable for the entire amount of these liabilities.
        If any party to the Tax Sharing Agreement were to default in its obligation to another party to pay its share of the distribution taxes that arise as a result of no party's fault, each non-defaulting party would be required to pay, equally with any other non-defaulting party, the amounts in default. In addition, if another party to the Tax Sharing Agreement that is responsible for all or a portion of an income tax liability were to default in its payment of such liability to a taxing authority, the Company could be legally liable under applicable tax law for such liabilities and required to make additional tax payments. Accordingly, under certain circumstances, the Company may be obligated to pay amounts in excess of its agreed upon share of its, Tyco International's, and Covidien's tax liabilities.
18. Income Taxes
        Significant components of the income tax provision for fiscal 2007, 2006, and 2005 are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Current:	 	 	 	 	 	 	 	 	 	 	
 	United States:	 	 	 	 	 	 	 	 	 	 	
 	 	Federal	 	$	45	 	$	(181	)	$	22	 	
 	 	State	 	 	3	 	 	(24	)	 	25	 	
 	Non-U.S.	 	 	284	 	 	302	 	 	383	 	
 	 		 		 		 	
 	Current income tax provision	 	 	332	 	 	97	 	 	430	 	
 	 		 		 		 	
Deferred:	 	 	 	 	 	 	 	 	 	 	
 	United States:	 	 	 	 	 	 	 	 	 	 	
 	 	Federal	 	 	153	 	 	42	 	 	(166	)	
 	 	State	 	 	(8	)	 	(35	)	 	74	 	
 	Non-U.S.	 	 	17	 	 	(58	)	 	38	 	
 	 		 		 		 	
Deferred income tax provision	 	 	162	 	 	(51	)	 	(54	)	
 	 		 		 		 	
 	 	$	494	 	$	46	 	$	376	 	
 	 		 		 		 	
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        The U.S. and non-U.S. components of income from continuing operations before income taxes and minority interest for 2007, 2006, and 2005 are as follows:

 	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
U.S.	 	$	291	 	$	6	 	$	97	
Non-U.S.	 	 	65	 	 	1,234	 	 	1,296	
 	 		 		 		
Income from continuing operations before income taxes and minority interest	 	$	356	 	$	1,240	 	$	1,393	
 	 		 		 		
        The reconciliation between U.S. federal income taxes at the statutory rate and the Company's provision for income taxes on continuing operations for fiscal 2007, 2006, and 2005 are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Notional U.S. federal income tax expense at the statutory rate	 	$	125	 	$	434	 	$	487	 	
Adjustments to reconcile to the income tax provision:	 	 	 	 	 	 	 	 	 	 	
 	U.S. state income tax (benefit) provision, net	 	 	(3	)	 	(39	)	 	64	 	
 	Tax credits	 	 	(11	)	 	(12	)	 	(15	)	
 	Non-U.S. net earnings (1)	 	 	(104	)	 	(122	)	 	(186	)	
 	Nondeductible charges	 	 	7	 	 	33	 	 	7	 	
 	Change in accrued income tax liabilities	 	 	53	 	 	21	 	 	110	 	
 	Allocated loss (gain) on retirement of debt	 	 	81	 	 	(87	)	 	127	 	
 	Tax law changes	 	 	(11	)	 	—	 	 	—	 	
 	Class action settlement	 	 	312	 	 	—	 	 	—	 	
 	Divestitures and impairments	 	 	—	 	 	71	 	 	(105	)	
 	Valuation allowance	 	 	26	 	 	(268	)	 	(129	)	
 	Proposed adjustments to prior year tax returns	 	 	9	 	 	—	 	 	—	 	
 	Other	 	 	10	 	 	15	 	 	16	 	
 	 		 		 		 	
 	Provision for income taxes	 	$	494	 	$	46	 	$	376	 	

(1)
Excludes asset impairments, nondeductible charges, and other items which are broken out separately in the table.
        In fiscal year 2007, no tax benefits were recorded related to the pre-tax charges for the class action settlement and loss on retirement of debt. The net increase of $26 million of deferred tax asset valuation allowances in fiscal 2007 reflects the tax impacts of increased borrowings as a result of the class action settlement and the Company's separation from Tyco International.
        The net decrease of $268 million of deferred tax asset valuation allowances in fiscal 2006 is primarily driven by improved profitability in certain jurisdictions, principally the U.S. The Company's U.S. results of operations in fiscal 2006 combined with other available evidence, including projections of future taxable income, indicate that it is more likely than not the Company will realize additional deferred tax assets in the future and accordingly the related valuation allowances were reduced.
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Reflected in the state tax provision line for fiscal 2006 is a $39 million state tax benefit primarily related to the Tyco Global Network divestiture.
        The allocated loss on retirement of debt in fiscal 2006 is a cumulative one-time benefit of $87 million associated with the receipt of a favorable non-U.S. tax ruling permitting the deduction of historical debt retirement costs. This benefit is partially offset by an increased valuation allowance of $62 million relating to the deferred tax asset associated with net operating losses created by the debt retirement deductions. This $62 million is reflected on the valuation allowance line in the table above.
        Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the net deferred income tax asset at fiscal year end 2007 and 2006 are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	
 	 	(in millions)
	 	
Deferred tax assets:	 	 	 	 	 	 	 	
 	Accrued liabilities and reserves	 	$	253	 	$	439	 	
 	Tax loss and credit carryforwards	 	 	2,135	 	 	1,936	 	
 	Inventories	 	 	60	 	 	35	 	
 	Pension and postretirement benefits	 	 	143	 	 	151	 	
 	Deferred revenue	 	 	26	 	 	68	 	
 	Other	 	 	146	 	 	144	 	
 	 		 		 	
 	 	 	2,763	 	 	2,773	 	
 	 		 		 	
Deferred tax liabilities:	 	 	 	 	 	 	 	
 	Intangible assets	 	 	(378	)	 	(347	)	
 	Property, plant, and equipment	 	 	(148	)	 	(197	)	
 	Other	 	 	(132	)	 	(170	)	
 	 		 		 	
 	 	 	(658	)	 	(714	)	
 	 		 		 	
Net deferred tax asset before valuation allowance	 	 	2,105	 	 	2,059	 	
Valuation allowance	 	 	(703	)	 	(611	)	
 	 		 		 	
 	Net deferred tax asset	 	$	1,402	 	$	1,448	 	
 	 		 		 	
        At fiscal year end 2007, the Company had approximately $1,253 million of U.S. federal and $192 million of U.S state net operating loss carryforwards (tax effected) which will expire in future years through 2027. In addition, at fiscal year end 2007, the Company had approximately $143 million of U.S. federal tax credit carryforwards, of which $22 million have no expiration and $121 million will expire in future years through 2027, and $40 million of U.S. state tax credits carryforwards which will expire in future years through 2027. The Company also had $5 million of U.S. federal contribution carryforwards (tax effected) expiring through 2011 and $21 million of U.S. federal capital loss carryforwards (tax effected) expiring through 2010 at fiscal year end 2007.
        At fiscal year end 2007, the Company had approximately $466 million of net operating loss carryforwards (tax effected) in certain non-U.S. jurisdictions, of which $164 million have no expiration and $302 million will expire in future years through 2017. Also, at fiscal year end 2007, there were
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$6 million of non-U.S. tax credit carryforwards which will expire in future years through 2013 and $9 million of non-U.S. capital loss carryforwards (tax effected) with no expiration.
        The valuation allowance for deferred tax assets of $703 million and $611 million at fiscal year end 2007 and 2006, respectively, relates principally to the uncertainty of the utilization of certain deferred tax assets, primarily tax loss and credit carryforwards in various jurisdictions. The Company believes that it will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets. The valuation allowance was calculated in accordance with the provisions of SFAS No. 109, " Accounting for Income Taxes ," which requires that a valuation allowance be established or maintained when it is "more likely than not" that all or a portion of deferred tax assets will not be realized. At fiscal year end 2007, approximately $4 million of the valuation allowance will ultimately reduce goodwill and approximately $16 million of the valuation allocation will be recorded to equity if certain net operating losses and tax credit carryforwards are utilized.
        The Company and its subsidiaries' income tax returns are periodically examined by various regulatory tax authorities. See "Income Taxes" in Note 16 for further information.
        The calculation of the Company's tax liabilities involves dealing with uncertainties in the application of complex tax regulations in a multitude of jurisdictions across its global operations. The Company recognizes potential liabilities and records tax liabilities as well as related interest for anticipated tax audit issues in the U.S. and other tax jurisdictions based on its estimate of whether, and the extent to which, additional taxes and related interest will be due. These tax liabilities and related interest are reflected net of the impact of related tax loss carryforwards as such tax loss carryforwards will be applied against these tax liabilities and will reduce the amount of cash tax payments due upon the eventual settlement with the tax authorities. The Company adjusts these liabilities in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the Company's current estimate of the tax liabilities. Further, management has reviewed with tax counsel the issues raised by these taxing authorities and the adequacy of these recorded amounts. If the Company's estimate of tax liabilities proves to be less than the ultimate assessment, an additional charge to expense would result. If payment of these amounts ultimately proves to be less than the recorded amounts, the reversal of the liabilities may result in income tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary. Substantially all of these potential tax liabilities are recorded in income taxes on the Consolidated and Combined Balance Sheets as payment is not expected within one year.
        Except for earnings that are currently distributed, no additional provision has been made for U.S. or non-U.S. income taxes on the undistributed earnings of subsidiaries or for unrecognized deferred tax liabilities for temporary differences related to basis differences in investments in subsidiaries, as such earnings are expected to be permanently reinvested, the investments are essentially permanent in duration, or the Company has concluded that no additional tax liability will arise as a result of the distribution of such earnings. A liability could arise if the intention to permanently reinvest earnings were to change and amounts are distributed by such subsidiaries or if such subsidiaries are ultimately disposed. It is not practicable to estimate the additional income taxes related to permanently reinvested earnings or the basis differences related to investments in subsidiaries.
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19. Other Expense, Net
        Other expense, net of $219 million in fiscal 2007 includes an allocation from Tyco International of $232 million for loss on retirement of debt. See Note 12 for additional information. Additionally, in fiscal 2007, the Company recorded other income of $13 million associated with Tyco International's and Covidien's share of certain contingent tax liabilities relating to unresolved tax matters of legacy Tyco International. For further information regarding the Tax Sharing Agreement, see Notes 16 and 17.
        Other expense, net in fiscal 2005 includes an allocation of $365 million from Tyco International for loss on retirement of debt. See Note 12 for additional information.
        The allocation methodology for the loss on retirement of debt is consistent with the treatment of debt and net interest expense as described in Note 12. Management believes that this allocation was reasonable given the impact such retirements had on the overall capital structure of Tyco International. However, these amounts may not be indicative of the actual losses on the retirement of debt that the Company would have incurred had the Company been operating as a separate, stand-alone company for the periods presented.
20. (Loss) Earnings Per Share
        The computation of basic (loss) earnings per share is based on the Company's net (loss) income divided by the basic weighted-average number of common shares. On June 29, 2007, the Separation from Tyco International was completed in a tax-free distribution to the Company's shareholders of one common share of Tyco Electronics Ltd. for every four common shares of Tyco International held on June 18, 2007. As a result, on June 29, 2007, the Company had 497 million common shares outstanding. The same number of shares is being used for both diluted earnings per share and basic earnings per share for all periods prior to the date of Separation as no Tyco Electronics equity awards were outstanding prior to the Separation.
        The following table sets forth the denominators of the basic and diluted (loss) earnings per share computations:

 	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
Weighted-average shares outstanding:	 	 	 	 	 	 	
 	Basic	 	497	 	497	 	497	
 	Stock options and restricted stock awards	 	—	 	—	 	—	
 	 		 		 		
 	Diluted	 	497	 	497	 	497	
 	 		 		 		
        For the year ended September 28, 2007, options to purchase Tyco Electronics' common shares with the underlying exercise prices less than the average market prices were outstanding, but were excluded from the calculations of diluted loss per share, as inclusion of these securities would have been antidilutive. Such shares not included in the computation of diluted loss per share totaled 3 million as of September 28, 2007.
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        In addition, certain share option awards were not included in the computation of diluted loss per share for the year ended September 28, 2007 because the instruments' underlying exercise prices were greater than the average market prices of Tyco Electronics' common shares and inclusion would be antidilutive. Such shares not included in the computation of diluted loss per share totaled 20 million as of September 28, 2007.
        The Separation and Distribution Agreement entered into pursuant to Separation requires that the Company issue common shares, as needed, to satisfy convertible debentures issued prior to Separation by Tyco International and retained by Tyco International subsequent to Separation. Up to approximately 250,000 shares could be issued to satisfy convertible debentures. For the year ended September 28, 2007, the number of shares issuable to holders of unconverted Tyco International debt would be antidilutive. Such shares not included in the computation of diluted loss per share were insignificant as of September 28, 2007.
        The following table sets forth the computation of basic and diluted (loss) earnings per share utilizing the net income for the year and the Company's basic and diluted shares outstanding:

 	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	
 	 	(in millions, except per share data)
	
Net (loss) income	 	$	(554	)	$	1,193	 	$	1,144	
Basic and diluted weighted-average shares outstanding	 	 	497	 	 	497	 	 	497	
 	 		 		 		
Basic and diluted (loss) earnings per share	 	$	(1.11	)	$	2.40	 	$	2.30	
 	 		 		 		
21. Equity
Parent Company Investment
        For all periods prior to June 29, 2007, Tyco International's investment in the electronics businesses is shown as parent company investment in the Combined Financial Statements. Parent company investment represents the historical investment of capital into the Company, the Company's accumulated net earnings after taxes, and the net effect of transactions with and allocations from Tyco International. See Note 17 for additional information regarding the allocation to the Company of various expenses incurred by Tyco International.
        On June 29, 2007, Tyco International completed a distribution of one common share of Tyco Electronics Ltd. for every four common shares of Tyco International. Following the Separation, the Company had 497 million common shares outstanding. After the Separation adjustments were recorded on June 29, 2007, the remaining parent company investment balance, which includes all earnings prior to the Separation, was transferred to contributed surplus. Net income subsequent to the Separation is included in accumulated earnings.
Preferred Shares
        The Company has authorized 125,000,000 preferred shares, par value of $0.20 per share, none of which were issued and outstanding at September 28, 2007. Rights as to dividends, return of capital, redemption, conversion, voting, and otherwise with respect to the preferred shares may be determined
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by the Company's board of directors on or before the time of issuance. In the event of the liquidation of the Company, the holders of any preferred shares then outstanding would be entitled to payment to them of the amount for which the preferred shares were subscribed and any unpaid dividends prior to any payment to the common shareholders.
Dividends
        In September 2007, the Company's board of directors declared a regular quarterly cash dividend of $0.14 per common share to be paid on November 1, 2007. The declared but unpaid dividend is recorded in accrued and other current liabilities on the Consolidated Balance Sheet at fiscal year end 2007.
Share Repurchase Program
        In September 2007, the Company's board of directors authorized a share repurchase program of $750 million to purchase a portion of the Company's outstanding common shares. No common shares were repurchased under this program in fiscal 2007.
22. Accumulated Other Comprehensive Income
        The components of accumulated other comprehensive income are as follows:

 	 	Currency
Translation (1)
	 	Unrealized
(Loss) Gain
on Securities
	 	Unrecognized
Pension and
Postretirement
Benefit Costs
	 	Unrealized Loss on
Cash Flow
Hedge
	 	Accumulated
Other
Comprehensive
Income
	 	
 	 	(in millions)
	 	
Balance at October 1, 2004	 	$	744	 	$	2	 	$	(255	)	$	—	 	$	491	 	
 	Pre-tax current period change	 	 	(87	)	 	(1	)	 	(116	)	 	—	 	 	(204	)	
 	Income tax benefit	 	 	—	 	 	—	 	 	44	 	 	—	 	 	44	 	
 	 		 		 		 		 		 	
Balance at September 30, 2005	 	 	657	 	 	1	 	 	(327	)	 	—	 	 	331	 	
 	Pre-tax current period change	 	 	242	 	 	—	 	 	150	 	 	—	 	 	392	 	
 	Income tax expense	 	 	—	 	 	—	 	 	(53	)	 	—	 	 	(53	)	
 	 		 		 		 		 		 	
Balance at September 29, 2006	 	 	899	 	 	1	 	 	(230	)	 	—	 	 	670	 	
 	Pre-tax current period change	 	 	453	 	 	—	 	 	319	 	 	(53	)	 	719	 	
 	Income tax expense	 	 	—	 	 	—	 	 	(112	)	 	—	 	 	(112	)	
 	 		 		 		 		 		 	
 	 	 	1,352	 	 	1	 	 	(23	)	 	(53	)	 	1,277	 	
 	Adoption of SFAS No. 158:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Pre-tax current period change	 	 	—	 	 	—	 	 	(347	)	 	—	 	 	(347	)	
 	 	Income tax benefit	 	 	—	 	 	—	 	 	122	 	 	—	 	 	122	 	
 	 		 		 		 		 		 	
 	 	Total	 	 	—	 	 	—	 	 	(225	)	 	—	 	 	(225	)	
 	 		 		 		 		 		 	
Balance at September 28, 2007	 	$	1,352	 	$	1	 	$	(248	)	$	(53	)	$	1,052	 	

(1)
During fiscal 2006, $38 million was transferred from currency translation adjustments as a result of the sale of non-U.S. entities. The $38 million gain is included in (loss) income from discontinued operations in the Combined Statement of Operations. During fiscal 2005, $30 million was transferred from currency translation adjustments and included in net income as a result of the sale of non-U.S. entities. The $30 million gain in fiscal 2005 related to the Tyco Global Network and is included in gain on divestiture in the Combined Statement of Operations.
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23. Share Plans
        Prior to Separation on June 29, 2007, all equity awards (restricted share awards and share options) held by Company employees were granted under the Tyco International Ltd. 2004 Stock and Incentive Plan or other Tyco International equity incentive plans. All equity awards granted by the Company subsequent to Separation were granted under the Tyco Electronics Ltd. 2007 Stock and Incentive Plan (the "2007 Plan"). The 2007 Plan is administered by the Management Development and Compensation Committee of the board of directors of Tyco Electronics, which consists exclusively of independent directors of Tyco Electronics and provides for the award of stock options, stock appreciation rights, annual performance bonuses, long-term performance awards, restricted units, deferred stock units, restricted stock, promissory stock, and other stock-based awards (collectively, "Awards"). The 2007 Plan provides for a maximum of 25 million common shares to be issued as Awards, subject to adjustment as provided under the terms of the 2007 Plan. The 2007 Plan allows for the use of authorized but unissued shares or treasury shares to be used to satisfy such awards.
        Prior to the Separation, all employee equity awards were granted by Tyco International. At the time of Separation, significantly all of Tyco International's outstanding restricted share awards issued to Company employees prior to September 29, 2006 were converted into restricted share awards of the Company at a ratio of one share of the Company for every four Tyco International common shares. The conversion of those pre-September 29, 2006 awards also resulted in the issuance of one restricted share award in Tyco International and Covidien. The conversion of pre-September 29, 2006 awards to executives and employees of Tyco International and Covidien resulted in the issuance of a Tyco Electronics Ltd. restricted share award for every four Tyco International awards that existed. The remaining restricted share and share option awards issued to Company employees converted into restricted share and share option awards of the Company based on a ratio of the Company's final pre-Separation when-issued share price and Tyco International's pre-Separation closing share price. All share option awards granted prior to September 29, 2006 to Company employees who were identified as "Tyco Corporate Employees' prior to Separation converted to share option awards in each of the three post-Separation companies based on ratios of the respective company's final pre-Separation when-issued share price and Tyco International's pre-Separation closing share price. All share option award conversions were done in accordance with Sections 409A and 424 of the Code. Upon Separation, all performance conditions on outstanding performance share awards to Company employees were lifted and those awards converted to restricted share awards in the Company's stock only.
Restricted Share Awards
        Restricted share awards are granted subject to certain restrictions. Conditions of vesting are determined at the time of grant under the 2007 Plan. All restrictions on the award will lapse upon retirement or normal retirement eligibility, death, or disability of the employee. Recipients of restricted shares have the right to vote such shares and receive dividends, whereas recipients of restricted units have no voting rights and receive dividend equivalents. For grants which vest based on certain specified performance criteria, the fair market value of the shares or units is expensed over the period of performance, once achievement of criteria is deemed probable. For grants that vest through passage of time, the fair market value of the award at the time of the grant is amortized to expense over the period of vesting. The fair value of restricted share awards is determined based on the market value of the Company's shares on the grant date. Restricted share awards generally vest in one-third increments over a period of four years beginning in the second year, as determined by the Management Development and Compensation Committee, or upon attainment of various levels of performance that
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equal or exceed targeted levels, if applicable. The compensation expense recognized for restricted share awards is net of estimated forfeitures.
        A summary of the status of restricted share awards and performance share grants by Tyco International prior to Separation and Tyco Electronics subsequent to Separation as of fiscal year end 2007 and changes during the year then ended is presented below:

Non-vested Restricted Share Awards
	 	Shares
	 	Weighted-Average
Grant-Date Fair Value
	
Non-vested at September 30, 2006	 	2,492,825	 	$	29.90	
Granted by Tyco International prior to Separation	 	1,472,960	 	 	30.34	
Vested prior to Separation	 	(682,696	)	 	27.71	
Forfeited prior to Separation	 	(114,949	)	 	29.87	
Awards granted pursuant to the Separation	 	1,713,945	 	 	34.08	
Effect of Separation on grants made by Tyco International	 	(1,641,204	)	 	30.47	
Granted by Tyco Electronics subsequent to Separation	 	1,896,610	 	 	39.69	
Vested subsequent to Separation	 	(703,098	)	 	35.60	
Forfeited subsequent to Separation	 	(35,848	)	 	35.72	
 	 		 	 	 	
Non-vested at September 28, 2007	 	4,398,545	 	$	36.96	
 	 		 	 	 	
        Included in the Awards granted pursuant to Separation above are 1,337,767 restricted share awards granted to employees and executives of Tyco International and Covidien. Fifty percent of those awards vested on July 2, 2007 and the remaining fifty percent will vest on January 2, 2008. Any expense related to this accelerated vesting is borne by the company employing the individual to whom the grant was awarded, either Tyco International or Covidien.
        Fifty percent of the expense associated with issuance of Tyco International and Covidien restricted share awards made to employees of the Company as a result of the Separation was recorded by the Company on July 2, 2007 and the remaining fifty percent is being expensed ratably through January 2, 2008. This acceleration of expense for Company employees is borne by the Company and is included in the Consolidated and Combined Statement of Operations within separation costs.
        The weighted-average grant-date fair value of Tyco International restricted share awards granted to Tyco Electronics employees during pre-Separation fiscal 2007, 2006 and 2005 was $30.34, $28.96, and $35.52 respectively. The weighted-average grant-date fair value of Tyco Electronics restricted share awards granted during fiscal 2007 was $39.69. The total fair value of restricted share awards vested for grants made by Tyco International to Tyco Electronics employees was $19 million during pre-Separation fiscal 2007, $5 million during fiscal 2006, and less than $1 million during fiscal 2005. The total fair
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value of restricted share awards vested for grants made by Tyco Electronics was $25 million during fiscal 2007.

Non-vested Performance Shares
	 	Shares
	 	Weighted-Average
Grant-Date Fair Value
	
Non-vested at September 30, 2006	 	117,600	 	$	29.00	
Granted by Tyco International prior to Separation	 	33,260	 	 	28.18	
Forfeited prior to Separation	 	(1,900	)	 	27.93	
Awards granted pursuant to the Separation	 	19,600	 	 	29.00	
Effect of Separation on grants made by Tyco International	 	(168,560	)	 	28.85	
 	 		 	 	 	
Non-vested at September 28, 2007	 	—	 	$	—	
 	 		 	 	 	
        The total fair value of Tyco International performance shares granted to Tyco Electronics employees vested during pre-Separation fiscal 2007, 2006, and 2005 was insignificant. Tyco Electronics issued no performance shares during fiscal 2007.
        As of fiscal year end 2007, there was $89 million of total unrecognized compensation cost related to both non-vested Tyco Electronics restricted share awards and performance shares. That cost is expected to be recognized over a weighted-average period of 2.4 fiscal years.
Deferred Stock Units
        Deferred Stock Units ("DSUs") are notional units that are tied to the value of Tyco Electronics common shares with distribution deferred until termination of employment. Distribution, when made, will be in the form of actual shares. Similar to restricted share grants that vest through the passage of time, the fair value of DSUs is determined based on the market value of the Company's shares on the grant date and is amortized to expense over the vesting period. Recipients of DSUs do not have the right to vote such shares and do not have the right to receive cash dividends. However, they have the right to receive dividend equivalents, which are delivered at the same time as the underlying DSUs. Conditions of vesting are determined at the time of grant. During fiscal year 2007, the Company granted 44,450 DSUs that vested immediately. The grant date fair value of those grants was expensed immediately and was determined to be insignificant.
Share Options
        Share options (or Options) are granted to purchase Tyco Electronics common shares at prices which are equal to or greater than the market price of the common shares on the date the option is granted. Conditions of vesting are determined at the time of grant under the 2007 Plan. Options generally vest and become exercisable in equal annual installments over a period of four years and will generally expire 10 years after the date of grant.
        As a result of the Separation, 7,217,640 share option awards were issued to employees and executives of Tyco International and Covidien. Share option activity for grants by Tyco International
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prior to Separation and Tyco Electronics subsequent to Separation as of fiscal year end 2007 and changes during the year then ended is presented below:

 	 	Shares
	 	Weighted-
Average
Exercise
Price
	 	Weighted-
Average
Remaining
Contractual
Term
	 	Aggregate
Intrinsic
Value
	
 	 	 	 	 	 	(in years)
	 	(in millions)
	
Outstanding at September 30, 2006	 	32,998,698	 	$	36.96	 	 	 	 	
Granted by Tyco International prior to Separation	 	2,440,402	 	 	30.26	 	 	 	 	
Exercised prior to Separation	 	(6,034,977	)	 	23.92	 	 	 	 	
Expired prior to Separation	 	(1,498,008	)	 	45.80	 	 	 	 	
Forfeited prior to Separation	 	(291,884	)	 	30.77	 	 	 	 	
Awards granted pursuant to the Separation	 	8,235,259	 	 	35.76	 	 	 	 	
Effect of Separation on grants made by Tyco International	 	(5,422,945	)	 	37.28	 	 	 	 	
Granted by Tyco Electronics subsequent to Separation	 	3,205,100	 	 	39.72	 	 	 	 	
Exercised subsequent to Separation	 	(557,891	)	 	24.35	 	 	 	 	
Expired subsequent to Separation	 	(724,573	)	 	57.74	 	 	 	 	
Forfeited subsequent to Separation	 	(41,610	)	 	39.70	 	 	 	 	
 	 		 	 	 	 	 	 	 	
Outstanding at September 28, 2007	 	32,307,571	 	$	42.86	 	5.3	 	100	
 	 		 	 	 	 	 	 	 	
Vested and unvested expected to vest at September 28, 2007	 	31,118,728	 	$	43.06	 	5.3	 	99	
Exercisable at September 28, 2007	 	24,435,466	 	 	44.53	 	4.1	 	96	
        The conversion of Tyco International share option awards into Tyco Electronics share option awards at Separation was considered a modification of an award in accordance with SFAS No. 123R, " Share Based Payment ." As a result, the Company compared the fair value of the award immediately prior to the Separation to the fair value immediately after the Separation to measure incremental compensation cost. The conversion resulted in an increase in the fair value of the awards of $13 million. Of that amount, the Company recorded non-cash compensation expense of $11 million in separation costs in the Consolidated and Combined Statement of Operations for fiscal year 2007. The remaining $2 million of modification expense will be recorded through 2011.
        As of fiscal year end 2007, there was $58 million of total unrecognized compensation cost related to non-vested Tyco Electronics share options granted under Tyco Electronics share option plans. The cost is expected to be recognized over a weighted-average period of 2.1 years.
Stock-Based Compensation
        Effective October 1, 2005, the Company adopted the provisions of SFAS No. 123R using the modified prospective transition method. As a result, the Company's results from continuing operations for fiscal 2006 include incremental share-based compensation expense of $40 million. Total share-based compensation cost during fiscal 2007, 2006, and 2005 of $100 million, $69 million, and $20 million, respectively, has been included in the Consolidated and Combined Statements of Operations within selling, general, and administrative expenses and separation costs. The Company has recognized a
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related tax benefit associated with its share-based compensation arrangements of $27 million, $19 million, and $6 million in fiscal 2007, 2006, and 2005, respectively.
        Prior to October 1, 2005, the Company accounted for share-based compensation plans in accordance with the provisions of Accounting Principles Board Opinion No. 25, as permitted by SFAS No. 123, and accordingly did not recognize compensation expense for the issuance of options with an exercise price equal to or greater than the market price of the stock at the date of grant. If Tyco International and the Company applied the fair value based method prescribed by SFAS No. 123, for share options granted by Tyco International to Tyco Electronics employees, the effect on net income would have been as follows:

 	 	Fiscal
2005
	 	
 	 	(in millions,
except per share
data)
	 	
Net income, as reported	 	$	1,144	 	
Add: Employee compensation expense for share options included in reported net income, net of income	 	 	5	 	
Less: Total employee compensation expense for share options determined under fair value method, net	 	 	(35	)	
 	 		 	
Net income, pro forma	 	$	1,114	 	
 	 		 	
Earnings per share:	 	 	 	 	
Basic and diluted, as reported	 	$	2.30	 	
Basic and diluted, pro forma	 	 	2.24	 	
        The grant-date fair value of each option grant is estimated using the Black-Scholes option pricing model. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected stock price volatility was calculated based on the historical volatility of the stock of a composite of peers of Tyco Electronics and implied volatility derived from exchange traded options on that same composite of peers. The average expected life was based on the contractual term of the option and expected employee exercise and post-vesting employment termination behavior. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life assumed at the date of grant. The expected annual dividend per share was based on Tyco Electronics' expected dividend rate. The compensation expense recognized is net of estimated forfeitures. Forfeitures are estimated based on voluntary termination behavior, as well as an analysis of actual option forfeitures.
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        The weighted-average assumptions Tyco International used in the Black-Scholes option pricing model for pre-Separation fiscal 2007, 2006, and 2005 are as follows:

 	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	
Expected stock price volatility	 	 	32	%	 	34	%	 	33	%	
Risk free interest rate	 	 	4.3	%	 	4.3	%	 	4.1	%	
Expected annual dividend per share	 	$	0.64	 	$	0.40	 	$	0.40	 	
Expected life of options (years)	 	 	4.9	 	 	4.0	 	 	4.3	 	
        The weighted-average assumptions Tyco Electronics used in the Black-Scholes option pricing model for post-Separation grants in fiscal 2007 are as follows:

 	 	Fiscal
2007
	 	
Expected stock price volatility	 	 	30	%	
Risk free interest rate	 	 	4.9	%	
Expected annual dividend per share	 	$	0.56	 	
Expected life of options (years)	 	 	5.2	 	
        The weighted-average grant-date fair values of Tyco International options granted to Tyco Electronics employees during pre-Separation fiscal 2007, 2006, and 2005 were $9.52, $8.96, and $10.97, respectively. The total intrinsic value of Tyco International options exercised by Tyco Electronics employees during pre-Separation fiscal 2007, 2006, and 2005 was $48 million, $22 million, and $32 million, respectively.
        The weighted-average grant-date fair value of Tyco Electronics options granted during post-Separation fiscal 2007 was $12.34. The total intrinsic value of Tyco Electronics options exercised during post-Separation fiscal 2007 was $7 million. The total cash received by the Company related to the exercise of options totaled $14 million. The related excess cash tax benefit classified as a financing cash inflow for fiscal 2007 in the Consolidated and Combined Statement of Cash Flows was not significant.
Employee Stock Purchase Plans
        The Company has adopted the Tyco Electronics Ltd. Employee Stock Purchase Plan (the "ESP Plan"). Substantially all full-time employees of the Company's U.S. subsidiaries and employees of certain qualified non-U.S. subsidiaries will be eligible to participate in this employee share purchase plan. Eligible employees authorize payroll deductions to be made for the purchase of shares. The Company matches a portion of the employee contribution by contributing an additional 15% of the employee's payroll deduction on the first $40,000 of payroll deductions. All shares purchased under the ESP Plan are purchased on the open market by a designated broker. The Company expects to allow participation in the ESP Plan during the first quarter of fiscal 2008.
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        Tyco Electronics also maintains two other employee stock purchase plans for the benefit of employees of certain qualified non-U.S. subsidiaries. The terms of these plans provided employees the right to purchase shares of the Company's stock at a stated price and receive certain tax benefits.
        The Company has adopted the Tyco Electronics Ltd. Savings Related Share Plan (the "UK SAYE Plan"). Under the UK SAYE Plan, eligible employees in the United Kingdom are granted options to purchase shares at the end of three years of service at 85% of the market price at the time of grant. Options under the UK SAYE Plan are generally exercisable after a period of three years and expire six months after the date of vesting. The Company expects to allow participation in the UK SAYE Plan during the second quarter of fiscal 2008.
        The Company also has adopted the Tyco Electronics Ireland Limited Irish Revenue Approved Profit Sharing Plan (the "Irish Bonus Plan"). Under the Irish Bonus Plan, eligible employees are offered the opportunity to acquire shares using a portion of their bonus. Such employees also have the opportunity to forego a portion of their basic salary to purchase additional shares. The Company expects to allow participation in the Irish Bonus Plan during the second quarter of fiscal 2008.
24. Consolidated and Combined Segment and Geographic Data
        The Company aggregates its operating segments into four reportable segments based upon the Company's internal business structure. See Note 1 for a description of the segments in which the Company operates. Segment performance is evaluated based on net sales and operating income. Generally, the Company considers all expenses to be of an operating nature, and, accordingly, allocates them to each reportable segment. Costs specific to a segment are charged to the segment. Corporate expenses, such as headquarters administrative costs, are allocated to the segments based on segment income from operations. Allocated class action settlement costs, net and separation costs incurred in fiscal 2007 were not allocated to the segments. Intersegment sales are not material and are recorded at selling prices that approximate market prices.
        Net sales and income from operations by business segment are presented in the following table for fiscal 2007, 2006, and 2005:

 	 	Net Sales
	 	Income from Operations
	 	
 	 	Fiscal
	 	Fiscal
	 	
 	 	2007
	 	2006
	 	2005
	 	2007
	 	2006
	 	2005
	 	
 	 	(in millions)
	 	
Electronic Components	 	$	10,111	 	$	9,386	 	$	8,757	 	$	1,339	 	$	1,404	 	$	1,398	 	
Network Solutions	 	 	1,897	 	 	1,740	 	 	1,526	 	 	231	 	 	268	 	 	225	 	
Wireless Systems	 	 	887	 	 	874	 	 	871	 	 	77	 	 	(239	) (1)	 	92	 	
Undersea Telecommunications	 	 	565	 	 	300	 	 	279	 	 	38	 	 	15	 	 	292	(2)	
Allocated class action settlement costs, net and separation costs	 	 	—	 	 	—	 	 	—	 	 	(932	)	 	—	 	 	—	 	
 	 		 		 		 		 		 		 	
Total	 	$	13,460	 	$	12,300	 	$	11,433	 	$	753	 	$	1,448	 	$	2,007	 	

(1)
Includes goodwill impairment of $316 million in fiscal 2006. See Note 9 for additional information.

(2)
Includes gain on sale of the Tyco Global Network of $301 million in fiscal 2005. See Note 5 for additional information.
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        No single customer accounted for a significant portion of sales in the years presented.
        As the Company is not organized by product or service, it is not practicable to disclose net sales by product or service.
        Depreciation and amortization and capital expenditures for fiscal 2007, 2006, and 2005 were as follows:

 	 	Depreciation and Amortization
	 	Capital Expenditures
	
 	 	Fiscal
	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
Electronic Components	 	$	436	 	$	396	 	$	396	 	$	521	 	$	462	 	$	419	
Network Solutions	 	 	32	 	 	32	 	 	33	 	 	52	 	 	38	 	 	28	
Wireless Systems	 	 	45	 	 	41	 	 	46	 	 	31	 	 	51	 	 	25	
Undersea Telecommunications	 	 	22	 	 	15	 	 	15	 	 	288	(1)	 	4	 	 	4	
 	 		 		 		 		 		 		
Total	 	$	535	 	$	484	 	$	490	 	$	892	 	$	555	 	$	476	

(1)
Includes $280 million related to the Company's exercise of its option to buy five cable-laying sea vessels in fiscal 2007. See Note 8 for additional information.
        Segment assets and a reconciliation of segment assets to total assets at fiscal year end 2007, 2006, and 2005 were as follows:

 	 	Segment Assets
	
 	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
Electronic Components	 	$	3,548	 	$	3,320	 	$	2,921	
Network Solutions	 	 	699	 	 	592	 	 	498	
Wireless Systems	 	 	331	 	 	314	 	 	345	
Undersea Telecommunications	 	 	155	 	 	58	 	 	42	
 	 		 		 		
Total segment assets (1)	 	 	4,733	 	 	4,284	 	 	3,806	
Other current assets	 	 	5,140	 	 	2,266	 	 	2,078	
Non-current assets	 	 	13,815	 	 	12,541	 	 	12,589	
 	 		 		 		
Total assets	 	$	23,688	 	$	19,091	 	$	18,473	

(1)
Segment assets are comprised of accounts receivable and inventory.
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        Net sales by geographic region for fiscal 2007, 2006, and 2005 and property, plant, and equipment, net by geographic area at fiscal year end 2007, 2006, and 2005 were as follows:

 	 	Net Sales (1)
	 	Property, Plant, and
Equipment, Net
	
 	 	Fiscal
	 	Fiscal
	
 	 	2007
	 	2006
	 	2005
	 	2007
	 	2006
	 	2005
	
 	 	(in millions)
	
United States	 	$	4,409	 	$	4,173	 	$	4,047	 	$	1,196	 	$	1,199	 	$	1,188	
Other Americas	 	 	514	 	 	460	 	 	399	 	 	52	 	 	42	 	 	40	
Europe/Middle East/Africa	 	 	4,858	 	 	4,310	 	 	4,094	 	 	1,331	 	 	1,176	 	 	1,107	
Asia-Pacific	 	 	3,679	 	 	3,357	 	 	2,893	 	 	926	(2)	 	659	 	 	578	
 	 		 		 		 		 		 		
Total	 	$	13,460	 	$	12,300	 	$	11,433	 	$	3,505	 	$	3,076	 	$	2,913	

(1)
Net sales from external customers is attributed to individual countries based on the legal entity that records the sale.

(2)
Includes the five cable-laying sea vessels that the Company exercised its option to buy in fiscal 2007. See Note 8 for additional information.
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25. Quarterly Financial Data (Unaudited)
        Summarized quarterly financial data for the fiscal years ended September 28, 2007 and September 29, 2006 were as follows:

 	 	Fiscal 2007
	 	
 	 	First (1)
	 	Second (2)
	 	Third (3)
	 	Fourth (4)
	 	
 	 	(in millions, except per share data)
	 	
Net sales	 	$	3,094	 	$	3,335	 	$	3,412	 	$	3,619	 	
Gross income	 	 	815	 	 	860	 	 	862	 	 	911	 	
Income (loss) from continuing operations	 	 	240	 	 	285	 	 	(933	)	 	264	 	
Income (loss) from discontinued operations, net of income taxes	 	 	41	 	 	(8	)	 	(435	)	 	(8	)	
Net income (loss)	 	 	281	 	 	277	 	 	(1,368	)	 	256	 	
Basic earnings (loss) per share:	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Income (loss) from continuing operations	 	$	0.48	 	$	0.57	 	$	(1.88	)	$	0.53	 	
 	Income (loss) from discontinued operations, net of income taxes	 	 	0.09	 	 	(0.01	)	 	(0.87	)	 	(0.01	)	
 	Net income (loss)	 	 	0.57	 	 	0.56	 	 	(2.75	)	 	0.52	 	
Diluted earnings (loss) per share:	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Income (loss) from continuing operations	 	$	0.48	 	$	0.57	 	$	(1.88	)	$	0.53	 	
 	Income (loss) from discontinued operations, net of income taxes	 	 	0.09	 	 	(0.01	)	 	(0.87	)	 	(0.02	)	
 	Net income (loss)	 	 	0.57	 	 	0.56	 	 	(2.75	)	 	0.51	 	
Weighted-average number of shares outstanding: (5)	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Basic	 	 	497	 	 	497	 	 	497	 	 	496	 	
 	Diluted	 	 	497	 	 	497	 	 	497	 	 	500	 	

(1)
Net income for the first quarter of fiscal 2007 includes $41 million of income, net of income taxes, from discontinued operations.

(2)
Net income for the second quarter of fiscal 2007 includes an $8 million loss, net of income taxes, from discontinued operations.

(3)
Loss from continuing operations for the third quarter of fiscal 2007 includes $891 million of allocated net class action settlement costs, $25 million of separation costs, $28 million of net restructuring and other charges, and $232 million of allocated loss on retirement of debt. Net loss includes a $435 million loss, net of income taxes, from discontinued operations.

(4)
Loss from continuing operations for the fourth quarter of fiscal 2007 includes $20 million of separation costs, $51 million of net restructuring and other charges, and $13 million of other income related to the accretion of interest on certain contingent tax liabilities relating to unresolved tax matters of legacy Tyco International. Net loss includes an $8 million loss, net of income taxes, from discontinued operations.

(5)
At Separation, on June 29, 2007, the Company had 497 million common shares outstanding. The same number of shares is being used for both diluted earnings per share and basic earnings per share for all periods prior to the date of Separation as no Tyco Electronics equity awards were outstanding prior to the Separation. The computation of diluted loss per share excludes non-vested restricted shares and stock options of 4 million for the quarter ending June 29, 2007 as their effect would have been anti-dilutive.
140

 	 	Fiscal 2006
	
 	 	First (1)
	 	Second (2)
	 	Third (3)
	 	Fourth (4)
	
 	 	(in millions, except per share data)
	
Net sales	 	$	2,817	 	$	3,029	 	$	3,206	 	$	3,248	
Gross income	 	 	744	 	 	843	 	 	845	 	 	869	
Income from continuing operations	 	 	241	 	 	318	 	 	305	 	 	324	
(Loss) income from discontinued operations, net of income taxes	 	 	(9	)	 	(16	)	 	(7	)	 	45	
Cumulative effect of accounting change, net of income taxes	 	 	(8	)	 	—	 	 	—	 	 	—	
Net income	 	 	224	 	 	302	 	 	298	 	 	369	

Basic and diluted earnings per share:	

 	

 	

 	

 	
 	Income from continuing operations	 	$	0.48	 	$	0.64	 	$	0.61	 	$	0.65	
 	(Loss) income from discontinued operations, net of income taxes	 	 	(0.02	)	 	(0.03	)	 	(0.01	)	 	0.09	
 	Cumulative effect of accounting change, net of income taxes	 	 	(0.01	)	 	—	 	 	—	 	 	—	
 	Net income	 	 	0.45	 	 	0.61	 	 	0.60	 	 	0.74	
Weighted-average number of shares outstanding: (5)	 	 	 	 	 	 	 	 	 	 	 	 	
 	Basic and diluted	 	 	497	 	 	497	 	 	497	 	 	497	

(1)
Net income for the first quarter of fiscal 2006 includes a $9 million loss, net of income taxes, from discontinued operations as well as an $8 million loss, net of income taxes, related to the cumulative effect of accounting change recorded in conjunction with the adoption of FIN 47, " Accounting for Conditional Asset Retirement Obligation—an Interpretation of FASB Statement No. 143 ." See Note 2 for additional information.

(2)
Net income for the second quarter of fiscal 2006 includes a $16 million loss, net of income taxes, from discontinued operations.

(3)
Net income for the third quarter of fiscal 2006 includes a $7 million loss, net of income taxes, from discontinued operations.

(4)
Income from continuing operations for the fourth quarter of fiscal 2006 included a goodwill impairment charge of $316 million in the Wireless Systems segment related to the Integrated Wireless Products reporting unit. Net income includes $45 million of income, net of income taxes, from discontinued operations.

(5)
At Separation, on June 29, 2007, the Company had 497 million common shares outstanding. The same number of shares is being used for both diluted earnings per share and basic earnings per share for all periods prior to the date of Separation as no Tyco Electronics equity awards were outstanding prior to the Separation.
26. Subsequent Events
        In October 2007, the Company entered into a definitive agreement to sell its Power Systems business for $100 million in cash, subject to a final working capital adjustment. The Company expects to recognize a gain of approximately $40 million on this divestiture. The sale transaction is expected to close in the first or second quarter of fiscal 2008.
141

27. Tyco Electronics Group S.A.
        In December 2006, prior to the Separation, TEGSA, a wholly owned subsidiary of Tyco Electronics Ltd., was formed. TEGSA, a Luxembourg company, is a holding company that owns directly, or indirectly, all of the operating subsidiaries of Tyco Electronics Ltd. TEGSA is the borrower under the Company's revolving credit facility, as well as obligor under the Company's senior notes issued in September 2007 and bridge loan facility, all of which are fully and unconditionally guaranteed by its parent, Tyco Electronics Ltd. The following tables present condensed consolidating financial information for Tyco Electronics Ltd., TEGSA and all other subsidiaries that are not providing a guarantee of debt but which represent assets of TEGSA, using the equity method.

 Consolidating Statement of Operations

For the Fiscal Year Ended September 28, 2007

 	 	Tyco
Electronics Ltd.
	 	Tyco
Electronics
Group S.A.
	 	Other
Subsidiaries
	 	Consolidating
Adjustments
	 	Total
	 	
 	 	(in millions)
	 	
Net sales	 	$	—	 	$	—	 	$	13,460	 	$	—	 	$	13,460	 	
Cost of sales	 	 	—	 	 	—	 	 	10,012	 	 	—	 	 	10,012	 	
 	 		 		 		 		 		 	
 	Gross income	 	 	—	 	 	—	 	 	3,448	 	 	—	 	 	3,448	 	
Selling, general, and administrative expenses	 	 	27	 	 	(34	)	 	1,671	 	 	—	 	 	1,664	 	
Allocated class action settlement costs, net	 	 	887	 	 	—	 	 	—	 	 	—	 	 	887	 	
Separation costs	 	 	—	 	 	—	 	 	45	 	 	—	 	 	45	 	
Restructuring and other charges, net	 	 	—	 	 	—	 	 	99	 	 	—	 	 	99	 	
 	 		 		 		 		 		 	
 	(Loss) income from operations	 	 	(914	)	 	34	 	 	1,633	 	 	—	 	 	753	 	
Interest income	 	 	—	 	 	11	 	 	42	 	 	—	 	 	53	 	
Interest expense	 	 	—	 	 	(105	)	 	(126	)	 	—	 	 	(231	)	
Other (expense) income, net	 	 	—	 	 	(232	)	 	13	 	 	—	 	 	(219	)	
Equity in net income of subsidiaries	 	 	770	 	 	955	 	 	—	 	 	(1,725	)	 	—	 	
Equity in net loss of subsidiaries held for sale	 	 	(410	)	 	(410	)	 	—	 	 	820	 	 	—	 	
Intercompany interest and fees	 	 	—	 	 	107	 	 	(107	)	 	—	 	 	—	 	
 	 		 		 		 		 		 	
 	(Loss) income from continuing operations before income taxes and minority interest	 	 	(554	)	 	360	 	 	1,455	 	 	(905	)	 	356	 	
Income taxes	 	 	—	 	 	—	 	 	(494	)	 	—	 	 	(494	)	
Minority interest	 	 	—	 	 	—	 	 	(6	)	 	—	 	 	(6	)	
 	 		 		 		 		 		 	
 	(Loss) income from continuing operations	 	 	(554	)	 	360	 	 	955	 	 	(905	)	 	(144	)	
(Loss) from discontinued operations, net of income taxes	 	 	—	 	 	—	 	 	(410	)	 	—	 	 	(410	)	
 	 		 		 		 		 		 	
 	Net (loss) income	 	$	(554	)	$	360	 	$	545	 	$	(905	)	$	(554	)	
 	 		 		 		 		 		 	
142

Consolidating Statement of Operations

For the Fiscal Year Ended September 29, 2006

 	 	Tyco
Electronics Ltd.
	 	Other Subsidiaries
	 	Total
	 	
 	 	(in millions)
	 	
Net sales	 	$	—	 	$	12,300	 	$	12,300	 	
Cost of sales	 	 	—	 	 	8,999	 	 	8,999	 	
 	 		 		 		 	
 	Gross income	 	 	—	 	 	3,301	 	 	3,301	 	
Selling, general, and administrative expenses	 	 	—	 	 	1,524	 	 	1,524	 	
Restructuring and other charges, net	 	 	—	 	 	13	 	 	13	 	
Goodwill impairment	 	 	—	 	 	316	 	 	316	 	
 	 		 		 		 	
 	Income from operations	 	 	—	 	 	1,448	 	 	1,448	 	
Interest income	 	 	—	 	 	48	 	 	48	 	
Interest expense	 	 	—	 	 	(256	)	 	(256	)	
 	 		 		 		 	
 	Income from continuing operations before income taxes and minority interest	 	 	—	 	 	1,240	 	 	1,240	 	
Income taxes	 	 	—	 	 	(46	)	 	(46	)	
Minority interest	 	 	—	 	 	(6	)	 	(6	)	
 	 		 		 		 	
 	Income from continuing operations	 	 	—	 	 	1,188	 	 	1,188	 	
Income from discontinued operations, net of income taxes	 	 	—	 	 	13	 	 	13	 	
 	 		 		 		 	
 	Income before cumulative effect of accounting change	 	 	—	 	 	1,201	 	 	1,201	 	
Cumulative effect of accounting change, net of income taxes	 	 	—	 	 	(8	)	 	(8	)	
 	 		 		 		 	
 	Net income	 	$	—	 	$	1,193	 	$	1,193	 	
 	 		 		 		 	
143

Consolidating Statement of Operations

For the Fiscal Year Ended September 30, 2005

 	 	Tyco
Electronics Ltd.
	 	Other
Subsidiaries
	 	Total
	 	
 	 	(in millions)
	 	 	 	
Net sales	 	$	—	 	$	11,433	 	$	11,433	 	
Cost of sales	 	 	—	 	 	8,334	 	 	8,334	 	
 	 		 		 		 	
 	Gross income	 	 	—	 	 	3,099	 	 	3,099	 	
Selling, general, and administrative expenses	 	 	—	 	 	1,403	 	 	1,403	 	
Restructuring and other credits, net	 	 	—	 	 	(10	)	 	(10	)	
Gain on divestiture	 	 	—	 	 	(301	)	 	(301	)	
 	 		 		 		 	
 	Income from operations	 	 	—	 	 	2,007	 	 	2,007	 	
Interest income	 	 	—	 	 	44	 	 	44	 	
Interest expense	 	 	—	 	 	(293	)	 	(293	)	
Other expense, net	 	 	—	 	 	(365	)	 	(365	)	
 	 		 		 		 	
 	Income from continuing operations before income taxes and minority interest	 	 	—	 	 	1,393	 	 	1,393	 	
Income taxes	 	 	—	 	 	(376	)	 	(376	)	
Minority interest	 	 	—	 	 	(6	)	 	(6	)	
 	 		 		 		 	
 	Income from continuing operations	 	 	—	 	 	1,011	 	 	1,011	 	
Income from discontinued operations, net of income taxes	 	 	—	 	 	122	 	 	122	 	
 	 		 		 		 	
 	Income before cumulative effect of accounting change	 	 	—	 	 	1,133	 	 	1,133	 	
Cumulative effect of accounting change, net of income taxes	 	 	—	 	 	11	 	 	11	 	
 	 		 		 		 	
 	Net income	 	$	—	 	$	1,144	 	$	1,144	 	
 	 		 		 		 	
144

 Consolidating Balance Sheet

As of September 28, 2007

 	 	Tyco
Electronics
Ltd.
	 	Tyco
Electronics
Group S.A.
	 	Other
Subsidiaries
	 	Consolidating
Adjustments
	 	Total
	
 	 	(in millions)
	
Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current Assets:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Cash and cash equivalents	 	$	2	 	$	—	 	$	934	 	$	—	 	$	936	
 	Accounts receivable, net	 	 	—	 	 	—	 	 	2,686	 	 	—	 	 	2,686	
 	Inventories	 	 	—	 	 	—	 	 	2,047	 	 	—	 	 	2,047	
 	Class action settlement escrow	 	 	928	 	 	—	 	 	—	 	 	—	 	 	928	
 	Class action settlement receivable	 	 	2,064	 	 	—	 	 	—	 	 	—	 	 	2,064	
 	Intercompany receivables	 	 	181	 	 	29	 	 	(84	)	 	(126	)	 	—	
 	Prepaid expenses and other current assets	 	 	(2	)	 	—	 	 	674	 	 	—	 	 	672	
 	Deferred income taxes	 	 	—	 	 	—	 	 	325	 	 	—	 	 	325	
 	Assets held for sale	 	 	—	 	 	—	 	 	215	 	 	—	 	 	215	
 	 		 		 		 		 		
 	Total current assets	 	 	3,173	 	 	29	 	 	6,797	 	 	(126	)	 	9,873	
Property, plant, and equipment, net	 	 	—	 	 	—	 	 	3,505	 	 	—	 	 	3,505	
Goodwill	 	 	—	 	 	—	 	 	7,177	 	 	—	 	 	7,177	
Intangible assets, net	 	 	—	 	 	—	 	 	554	 	 	—	 	 	554	
Deferred income taxes	 	 	—	 	 	—	 	 	1,397	 	 	—	 	 	1,397	
Investment in subsidiaries	 	 	11,324	 	 	13,517	 	 	—	 	 	(24,841	)	 	—	
Investment in subsidiaries held for sale	 	 	51	 	 	51	 	 	—	 	 	(102	)	 	—	
Intercompany loans receivable	 	 	—	 	 	6,267	 	 	5,024	 	 	(11,291	)	 	—	
Receivable from Tyco International Ltd. and Covidien Ltd.	 	 	—	 	 	—	 	 	844	 	 	—	 	 	844	
Other assets	 	 	—	 	 	2	 	 	336	 	 	—	 	 	338	
 	 		 		 		 		 		
 	Total Assets	 	$	14,548	 	$	19,866	 	$	25,634	 	$	(36,360	)	$	23,688	

Liabilities and Equity	

 	

 	

 	

 	

 	
Current Liabilities:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Current maturities of long-term debt	 	$	—	 	$	—	 	$	5	 	$	—	 	$	5	
 	Accounts payable	 	 	1	 	 	—	 	 	1,381	 	 	—	 	 	1,382	
 	Class action settlement liability	 	 	2,992	 	 	—	 	 	—	 	 	—	 	 	2,992	
 	Accrued and other current liabilities	 	 	61	 	 	3	 	 	1,386	 	 	—	 	 	1,450	
 	Deferred revenue	 	 	—	 	 	—	 	 	191	 	 	—	 	 	191	
 	Intercompany payables	 	 	29	 	 	181	 	 	(172	)	 	(38	)	 	—	
 	Liabilities held for sale	 	 	—	 	 	—	 	 	165	 	 	—	 	 	165	
 	 		 		 		 		 		
 	Total current liabilities	 	 	3,083	 	 	184	 	 	2,956	 	 	(38	)	 	6,185	
Long-term debt and obligations under capital lease	 	 	—	 	 	3,283	 	 	90	 	 	—	 	 	3,373	
Intercompany loans payable	 	 	88	 	 	5,024	 	 	6,267	 	 	(11,379	)	 	—	
Long-term pension and postretirement liabilities	 	 	—	 	 	—	 	 	607	 	 	—	 	 	607	
Deferred income taxes	 	 	—	 	 	—	 	 	271	 	 	—	 	 	271	
Income taxes	 	 	—	 	 	—	 	 	1,242	 	 	—	 	 	1,242	
Other liabilities	 	 	—	 	 	—	 	 	618	 	 	—	 	 	618	
 	 		 		 		 		 		
 	Total Liabilities	 	 	3,171	 	 	8,491	 	 	12,051	 	 	(11,417	)	 	12,296	
 	 		 		 		 		 		
Minority interest	 	 	—	 	 	—	 	 	15	 	 	—	 	 	15	
Equity	 	 	11,377	 	 	11,375	 	 	13,568	 	 	(24,943	)	 	11,377	
 	 		 		 		 		 		
 	Total Liabilities and Equity	 	$	14,548	 	$	19,866	 	$	25,634	 	$	(36,360	)	$	23,688	
 	 		 		 		 		 		
145

Consolidating Balance Sheet

As of September 29, 2006

 	 	Tyco
Electronics Ltd.
	 	Other
Subsidiaries
	 	Total
	
 	 	(in millions)
	
Assets	 	 	 	 	 	 	 	 	 	
Current Assets:	 	 	 	 	 	 	 	 	 	
 	Cash and cash equivalents	 	$	—	 	$	469	 	$	469	
 	Accounts receivable, net	 	 	—	 	 	2,434	 	 	2,434	
 	Inventories	 	 	—	 	 	1,850	 	 	1,850	
 	Prepaid expenses and other current assets	 	 	—	 	 	447	 	 	447	
 	Deferred income taxes	 	 	—	 	 	368	 	 	368	
 	Assets held for sale	 	 	—	 	 	982	 	 	982	
 	 		 		 		
 	Total current assets	 	 	—	 	 	6,550	 	 	6,550	
Property, plant, and equipment, net	 	 	—	 	 	3,076	 	 	3,076	
Goodwill	 	 	—	 	 	7,135	 	 	7,135	
Intangible assets, net	 	 	—	 	 	576	 	 	576	
Deferred income taxes	 	 	—	 	 	1,501	 	 	1,501	
Other assets	 	 	—	 	 	253	 	 	253	
 	 		 		 		
 	Total Assets	 	$	—	 	$	19,091	 	$	19,091	
 	 		 		 		
Liabilities and Equity	 	 	 	 	 	 	 	 	 	
Current Liabilities:	 	 	 	 	 	 	 	 	 	
 	Current maturities of long-term debt	 	$	—	 	$	291	 	$	291	
 	Accounts payable	 	 	—	 	 	1,251	 	 	1,251	
 	Accrued and other current liabilities	 	 	—	 	 	1,307	 	 	1,307	
 	Deferred revenue	 	 	—	 	 	155	 	 	155	
 	Liabilities held for sale	 	 	—	 	 	145	 	 	145	
 	 		 		 		
 	Total current liabilities	 	 	—	 	 	3,149	 	 	3,149	
Long-term debt and obligations under capital lease	 	 	—	 	 	3,371	 	 	3,371	
Long-term pension and postretirement liabilities	 	 	—	 	 	491	 	 	491	
Deferred income taxes	 	 	—	 	 	380	 	 	380	
Income taxes	 	 	—	 	 	190	 	 	190	
Other liabilities	 	 	—	 	 	334	 	 	334	
 	 		 		 		
 	Total Liabilities	 	 	—	 	 	7,915	 	 	7,915	
 	 		 		 		
Minority interest	 	 	—	 	 	16	 	 	16	
Equity	 	 	—	 	 	11,160	 	 	11,160	
 	 		 		 		
 	Total Liabilities and Equity	 	$	—	 	$	19,091	 	$	19,091	
 	 		 		 		
146

Consolidating Statement of Cash Flows

For the Fiscal Year Ended September 28, 2007

 	 	Tyco
Electronics Ltd.
	 	Tyco
Electronics
Group S.A.
	 	Other
Subsidiaries
	 	Consolidating
Adjustments
	 	Total
	 	
 	 	(in millions)
	 	
Cash Flows From Operating Activities:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Net cash (used in) provided by operating activities	 	$	(74	)	$	(264	)	$	1,876	 	$	—	 	$	1,538	 	
 	Net cash used in discontinued operating activities	 	 	—	 	 	—	 	 	(13	)	 	—	 	 	(13	)	
 	 		 		 		 		 		 	
Cash Flows From Investing Activities:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	—	 	 	—	 	 	(892	)	 	—	 	 	(892	)	
Proceeds from sale of property, plant, and equipment	 	 	—	 	 	—	 	 	72	 	 	—	 	 	72	 	
Purchase accounting and holdback/earn-out liabilities	 	 	—	 	 	—	 	 	(3	)	 	—	 	 	(3	)	
Class action settlement escrow	 	 	(928	)	 	—	 	 	—	 	 	—	 	 	(928	)	
Proceeds from divestiture of discontinued operation, net of cash retained by business sold	 	 	—	 	 	—	 	 	227	 	 	—	 	 	227	 	
Decrease in intercompany loans	 	 	—	 	 	2,011	 	 	—	 	 	(2,011	)	 	—	 	
 	 		 		 		 		 		 	
 	Net cash (used in) provided by investing activities	 	 	(928	)	 	2,011	 	 	(596	)	 	(2,011	)	 	(1,524	)	
 	Net cash used in discontinued investing activities	 	 	—	 	 	—	 	 	(4	)	 	—	 	 	(4	)	
 	 		 		 		 		 		 	
Cash Flows From Financing Activities:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Debt proceeds	 	 	—	 	 	5,676	 	 	—	 	 	—	 	 	5,676	 	
Allocated debt activity	 	 	—	 	 	(3,743	)	 	—	 	 	—	 	 	(3,743	)	
Repayment of debt	 	 	—	 	 	(2,393	)	 	(62	)	 	—	 	 	(2,455	)	
Net transactions with former parent	 	 	875	 	 	(2,956	)	 	3,193	 	 	—	 	 	1,112	 	
Changes in parent company equity	 	 	129	 	 	1,669	 	 	(1,798	)	 	—	 	 	—	 	
Transfers to discontinued operations	 	 	—	 	 	—	 	 	(181	)	 	—	 	 	(181	)	
Loan borrowing from parent	 	 	—	 	 	—	 	 	(2,011	)	 	2,011	 	 	—	 	
Minority interest distributions paid	 	 	—	 	 	—	 	 	(7	)	 	—	 	 	(7	)	
Other	 	 	—	 	 	—	 	 	5	 	 	—	 	 	5	 	
 	 		 		 		 		 		 	
 	Net cash provided by (used in) financing activities	 	 	1,004	 	 	(1,747	)	 	(861	)	 	2,011	 	 	407	 	
 	Net cash provided by discontinued financing activities	 	 	—	 	 	—	 	 	24	 	 	—	 	 	24	 	
 	 		 		 		 		 		 	
Effect of currency translation on cash	 	 	—	 	 	—	 	 	46	 	 	—	 	 	46	 	
Net increase in cash and cash equivalents	 	 	2	 	 	—	 	 	472	 	 	—	 	 	474	 	
Less: net increase in cash and cash equivalents related to discontinued operations	 	 	—	 	 	—	 	 	(7	)	 	—	 	 	(7	)	
Cash and cash equivalents at beginning of fiscal year	 	 	—	 	 	—	 	 	469	 	 	—	 	 	469	 	
 	 		 		 		 		 		 	
Cash and cash equivalents at end of fiscal year	 	$	2	 	$	—	 	$	934	 	$	—	 	$	936	 	
 	 		 		 		 		 		 	
147

Consolidating Statement of Cash Flows

For the Fiscal Year Ended September 29, 2006

 	 	Tyco Electronics Ltd.
	 	Other Subsidiaries
	 	Total
	 	
 	 	(in millions)
	 	
Cash Flows From Operating Activities:	 	 	 	 	 	 	 	 	 	 	
 	Net cash provided by operating activities	 	$	—	 	$	1,665	 	$	1,665	 	
 	Net cash used in discontinued operating activities	 	 	—	 	 	(2	)	 	(2	)	
 	 		 		 		 	
Cash Flows From Investing Activities:	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	—	 	 	(555	)	 	(555	)	
Proceeds from sale of property, plant, and equipment	 	 	—	 	 	12	 	 	12	 	
Acquisition of businesses, net of cash acquired	 	 	—	 	 	(23	)	 	(23	)	
Purchase accounting and holdback/earn-out liabilities	 	 	—	 	 	(3	)	 	(3	)	
Other	 	 	—	 	 	26	 	 	26	 	
 	 		 		 		 	
 	Net cash used in investing activities	 	 	—	 	 	(543	)	 	(543	)	
 	Net cash used in discontinued investing activities	 	 	—	 	 	(96	)	 	(96	)	
 	 		 		 		 	
Cash Flows From Financing Activities:	 	 	 	 	 	 	 	 	 	 	
Allocated debt activity	 	 	—	 	 	(731	)	 	(731	)	
Repayment of debt	 	 	—	 	 	(113	)	 	(113	)	
Net transactions with former parent	 	 	—	 	 	(74	)	 	(74	)	
Transfers from discontinued operations	 	 	—	 	 	2	 	 	2	 	
Minority interest distributions paid	 	 	—	 	 	(12	)	 	(12	)	
Other	 	 	—	 	 	(4	)	 	(4	)	
 	 		 		 		 	
 	Net cash used in financing activities	 	 	—	 	 	(932	)	 	(932	)	
 	Net cash provided by discontinued financing activities	 	 	—	 	 	104	 	 	104	 	
 	 		 		 		 	
Effect of currency translation on cash	 	 	—	 	 	(1	)	 	(1	)	
Net increase in cash and cash equivalents	 	 	—	 	 	195	 	 	195	 	
Less: net increase in cash and cash equivalents related to discontinued operations	 	 	—	 	 	(6	)	 	(6	)	
Cash and cash equivalents at beginning of fiscal year	 	 	—	 	 	280	 	 	280	 	
 	 		 		 		 	
Cash and cash equivalents at end of fiscal year	 	$	—	 	$	469	 	$	469	 	
 	 		 		 		 	
148

Consolidating Statement of Cash Flows

For the Fiscal Year Ended September 30, 2005

 	 	Tyco Electronics Ltd.
	 	Other Subsidiaries
	 	Total
	 	
 	 	(in millions)
	 	
Cash Flows From Operating Activities:	 	 	 	 	 	 	 	 	 	 	
 	Net cash provided by operating activities	 	$	—	 	$	1,546	 	$	1,546	 	
 	Net cash used in discontinued operating activities	 	 	—	 	 	(35	)	 	(35	)	
 	 		 		 		 	
Cash Flows From Investing Activities:	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	—	 	 	(476	)	 	(476	)	
Proceeds from sale of property, plant, and equipment	 	 	—	 	 	23	 	 	23	 	
Acquisition of businesses, net of cash acquired	 	 	—	 	 	(12	)	 	(12	)	
Purchase accounting and holdback/earn-out liabilities	 	 	—	 	 	(8	)	 	(8	)	
Proceeds from divestiture of business, net of cash retained by business sold	 	 	—	 	 	130	 	 	130	 	
Other	 	 	—	 	 	61	 	 	61	 	
 	 		 		 		 	
 	Net cash used in investing activities	 	 	—	 	 	(282	)	 	(282	)	
 	Net cash used in discontinued investing activities	 	 	—	 	 	(4	)	 	(4	)	
 	 		 		 		 	
Cash Flows From Financing Activities:	 	 	 	 	 	 	 	 	 	 	
Allocated debt activity	 	 	—	 	 	(1,330	)	 	(1,330	)	
Repayment of debt	 	 	—	 	 	(114	)	 	(114	)	
Net transactions with former parent	 	 	—	 	 	85	 	 	85	 	
Transfers to discontinued operations	 	 	—	 	 	(16	)	 	(16	)	
Minority interest distributions paid	 	 	—	 	 	(12	)	 	(12	)	
Other	 	 	—	 	 	(1	)	 	(1	)	
 	 		 		 		 	
 	Net cash used in financing activities	 	 	—	 	 	(1,388	)	 	(1,388	)	
 	Net cash provided by discontinued financing activities	 	 	—	 	 	35	 	 	35	 	
 	 		 		 		 	
Effect of currency translation on cash	 	 	—	 	 	11	 	 	11	 	
Net decrease in cash and cash equivalents	 	 	—	 	 	(117	)	 	(117	)	
Less: net decrease in cash and cash equivalents related to discontinued operations	 	 	—	 	 	4	 	 	4	 	
Cash and cash equivalents at beginning of fiscal year	 	 	—	 	$	393	 	$	393	 	
 	 		 		 		 	
Cash and cash equivalents at the end of fiscal year	 	$	—	 	$	280	 	$	280	 	
 	 		 		 		 	
149

 TYCO ELECTRONICS LTD.

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005

Description
	 	Balance at
Beginning of Year
	 	Additions Charged to
Costs and Expenses
	 	Acquisitions,
Divestitures
and Other
	 	Deductions
	 	Balance at
End of Year
	
 	 	(in millions)
	
Fiscal 2007	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Allowance for Doubtful Accounts Receivable	 	$	59	 	$	8	 	$	4	 	$	(11	)	$	60	
Fiscal 2006	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Allowance for Doubtful Accounts Receivable	 	 	69	 	 	2	 	 	1	 	 	(13	)	 	59	
Fiscal 2005	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Allowance for Doubtful Accounts Receivable	 	 	66	 	 	17	 	 	6	 	 	(20	)	 	69	
150

QuickLinks
TYCO ELECTRONICS LTD. TABLE OF CONTENTS
SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS
 PART I
ITEM 1A. RISK FACTORS
ITEM 1B. UNRESOLVED STAFF COMMENTS
ITEM 2. PROPERTIES
ITEM 3. LEGAL PROCEEDINGS
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
ITEM 6. SELECTED FINANCIAL DATA
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
 Liquidity and Capital Resources
Commitments and Contingencies
Off-Balance Sheet Arrangements
Critical Accounting Policies and Estimates
 Accounting Pronouncements
Forward-Looking Information
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
ITEM 9A. CONTROLS AND PROCEDURES
ITEM 9B. OTHER INFORMATION
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 11. EXECUTIVE COMPENSATION
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
SIGNATURES
 TYCO ELECTRONICS LTD. INDEX TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 TYCO ELECTRONICS LTD. CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
 TYCO ELECTRONICS LTD. CONSOLIDATED AND COMBINED BALANCE SHEETS As of September 28, 2007 and September 29, 2006
 TYCO ELECTRONICS LTD. CONSOLIDATED AND COMBINED STATEMENTS OF EQUITY Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
 TYCO ELECTRONICS LTD. CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005
 TYCO ELECTRONICS LTD. NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
 Consolidating Statement of Operations For the Fiscal Year Ended September 28, 2007
 Consolidating Statement of Operations For the Fiscal Year Ended September 29, 2006
 Consolidating Statement of Operations For the Fiscal Year Ended September 30, 2005
 Consolidating Balance Sheet As of September 28, 2007
 Consolidating Balance Sheet As of September 29, 2006
 Consolidating Statement of Cash Flows For the Fiscal Year Ended September 28, 2007
 Consolidating Statement of Cash Flows For the Fiscal Year Ended September 29, 2006
 Consolidating Statement of Cash Flows For the Fiscal Year Ended September 30, 2005
 TYCO ELECTRONICS LTD. SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Fiscal Years Ended September 28, 2007, September 29, 2006, and September 30, 2005

EXHIBIT 4.1(a)

TYCO ELECTRONICS GROUP S.A.,
as Issuer
 
AND
 
TYCO ELECTRONICS LTD.,
as Guarantor
 
AND
 
DEUTSCHE BANK TRUST
COMPANY AMERICAS,
as Trustee
 
INDENTURE
 
Dated as of September 25, 2007

UNSUBORDINATED DEBT SECURITIES

 
TABLE OF CONTENTS

 	 	 	 	Page	
ARTICLE I. DEFINITIONS	 	1	
 	Section 1.01	Definitions of Terms	 	1	
 	 	 	 	 	
ARTICLE II. ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION AND EXCHANGE OF SECURITIES	 	8	
 	Section 2.01	Designation and Terms of Securities	 	8	
 	Section 2.02	Form of Securities and Trustee’s Certificate	 	11	
 	Section 2.03	Denominations; Provisions for Payment	 	13	
 	Section 2.04	Execution and Authentications	 	15	
 	Section 2.05	Transfer and Exchange	 	16	
 	Section 2.06	Temporary Securities	 	23	
 	Section 2.07	Mutilated, Destroyed, Lost or Stolen Securities	 	24	
 	Section 2.08	Cancellation	 	24	
 	Section 2.09	Benefits of Indenture	 	25	
 	Section 2.10	Authenticating Agent	 	25	
 	Section 2.11	Global Securities	 	25	
 	Section 2.12	CUSIP Numbers	 	26	
 	Section 2.13	Securities Denominated in Foreign Currencies	 	26	
 	Section 2.14	Wire Transfers	 	26	
 	Section 2.15	Designated Currency	 	27	
 	Section 2.16	Form of Guarantee	 	27	
 	 	 	 	 	
ARTICLE III. REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS	 	28	
 	Section 3.01	Redemption	 	28	
 	Section 3.02	Notice of Redemption	 	28	
 	Section 3.03	Payment Upon Redemption	 	29	
 	Section 3.04	Sinking Fund	 	30	
 	Section 3.05	Satisfaction of Sinking Fund Payments with Securities	 	30	
 	Section 3.06	Redemption of Securities for Sinking Fund	 	30	
 	 	 	 	 	
ARTICLE IV. CERTAIN COVENANTS	 	31	
 	Section 4.01	Payment of Principal, Premium and Interest	 	31	
 	Section 4.02	Maintenance of Office or Agency	 	31	
 	Section 4.03	Paying Agents	 	31	
 	Section 4.04	Statement by Officers as to Default	 	32	
 	Section 4.05	Appointment to Fill Vacancy in Office of Trustee	 	32	
 	 	 	 	 	
ARTICLE V. SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE	 	32	
 	Section 5.01	Company to Furnish Trustee Names and Addresses of Securityholders	 	32	
 	Section 5.02	Preservation of Information; Communications with Securityholders	 	33	
 	Section 5.03	Reports by the Company	 	33	
 
i

 

 	Section 5.04	Reports by the Trustee	 	33	
 	 	 	 	 	
ARTICLE VI. REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT	 	34	
 	Section 6.01	Events of Default	 	34	
 	Section 6.02	Collection of Indebtedness and Suits for Enforcement by Trustee	 	37	
 	Section 6.03	Application of Funds Collected	 	38	
 	Section 6.04	Limitation on Suits	 	38	
 	Section 6.05	Rights and Remedies Cumulative; Delay or Omission not Waiver	 	39	
 	Section 6.06	Control by Securityholders	 	39	
 	Section 6.07	Undertaking to Pay Costs	 	40	
 	Section 6.08	Waiver Of Usury, Stay Or Extension Laws	 	40	
 	 	 	 	 	
ARTICLE VII. CONCERNING THE TRUSTEE	 	41	
 	Section 7.01	Certain Duties and Responsibilities of Trustee	 	41	
 	Section 7.02	Certain Rights of Trustee	 	42	
 	Section 7.03	Trustee not Responsible for Recitals or Issuance of Securities	 	43	
 	Section 7.04	May Hold Securities	 	43	
 	Section 7.05	Funds Held in Trust	 	43	
 	Section 7.06	Compensation and Reimbursement	 	44	
 	Section 7.07	Reliance on Officer’s Certificate	 	44	
 	Section 7.08	Disqualification; Conflicting Interests	 	44	
 	Section 7.09	Corporate Trustee Required; Eligibility	 	45	
 	Section 7.10	Resignation and Removal; Appointment of Successor	 	45	
 	Section 7.11	Acceptance of Appointment By Successor	 	46	
 	Section 7.12	Merger, Conversion, Consolidation or Succession to Business	 	47	
 	Section 7.13	Preferential Collection of Claims Against the Company	 	48	
 	 	 	 	 	
ARTICLE VIII. CONCERNING THE SECURITYHOLDERS	 	48	
 	Section 8.01	Evidence of Action by Securityholders	 	48	
 	Section 8.02	Proof of Execution by Securityholders	 	48	
 	Section 8.03	Who May be Deemed Owners	 	49	
 	Section 8.04	Certain Securities Owned by Company Disregarded	 	49	
 	Section 8.05	Actions Binding on Future Securityholders	 	50	
 	 	 	 	 	
ARTICLE IX. SUPPLEMENTAL INDENTURES	 	50	
 	Section 9.01	Supplemental Indentures Without the Consent of Securityholders	 	50	
 	Section 9.02	Supplemental Indentures with Consent of Securityholders	 	51	
 	Section 9.03	Effect of Supplemental Indentures	 	52	
 	Section 9.04	Securities Affected by Supplemental Indentures	 	53	
 	Section 9.05	Execution of Supplemental Indentures	 	53	
 	 	 	 	 	
ARTICLE X. SUCCESSOR	 	53	
 	Section 10.01	Consolidation, Merger and Sale of Assets	 	53	
 	Section 10.02	Successor Person Substituted	 	54	
 
ii

 

ARTICLE XI. SATISFACTION AND DISCHARGE	 	54	
 	Section 11.01	Applicability of Article	 	54	
 	Section 11.02	Satisfaction and Discharge of Indenture	 	55	
 	Section 11.03	Defeasance and Discharge of Obligations; Covenant Defeasance	 	55	
 	Section 11.04	Deposited Funds to be Held in Trust	 	57	
 	Section 11.05	Payment of Funds Held by Paying Agents	 	57	
 	Section 11.06	Repayment to Parent or the Company	 	58	
 	Section 11.07	Reinstatement	 	58	
 	 	 	 	 	
ARTICLE XII. IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS	 	58	
 	Section 12.01	No Recourse	 	58	
 	 	 	 	 	
ARTICLE XIII. MISCELLANEOUS PROVISIONS	 	59	
 	Section 13.01	Effect on Successors and Assigns	 	59	
 	Section 13.02	Actions by Successor	 	59	
 	Section 13.03	Notices	 	59	
 	Section 13.04	Governing Law	 	61	
 	Section 13.05	Treatment of Securities as Debt	 	61	
 	Section 13.06	Compliance Certificates and Opinions	 	61	
 	Section 13.07	Payments on Business Days	 	62	
 	Section 13.08	Conflict with Trust Indenture Act	 	62	
 	Section 13.09	Counterparts	 	62	
 	Section 13.10	Separability	 	62	
 	Section 13.11	No Adverse Interpretation of Other Agreements	 	62	
 	Section 13.12	Table of Contents, Headings, Etc.	 	63	
 	Section 13.13	Consent to Jurisdiction and Service of Process	 	63	
 	Section 13.14	Waiver of Jury Trial	 	64	
 	Section 13.15	USA Patriot Act	 	64	
 	 	 	 	 	
ARTICLE XIV. ADDITIONAL AMOUNTS; CERTAIN TAX PROVISIONS	 	64	
 	Section 14.01	Redemption Upon Changes in Withholding Taxes	 	64	
 	Section 14.02	Payment of Additional Amounts	 	65	
 	 	 	 	 	
ARTICLE XV. GUARANTEES	 	68	
 	Section 15.01	Guarantee	 	68	
 	Section 15.02	Execution and Delivery of Guarantee	 	69	
 	Section 15.03	Release of Guarantee	 	69	
 
iii

 
Cross Reference Table*

Section of
Trust Indenture Act
of 1939, as amended	 	Section of
Indenture	 	
 	 	 	 	
310(a)	 	7.09	 	
310(b)	 	7.08	 	
 	 	7.10	 	
310(c)	 	Inapplicable	 	
311(a)	 	7.13	 	
311(b)	 	7.13	 	
311(c)	 	Inapplicable	 	
312(a)	 	5.01	 	
 	 	5.02(a)	 	
312(b)	 	5.02(b)	 	
312(c)	 	5.02(b)	 	
313(a)	 	5.04(a)	 	
313(b)	 	5.04(b)	 	
313(c)	 	5.04(a)	 	
 	 	5.04(b)	 	
313(d)	 	5.04(b)	 	
314(a)	 	5.03	 	
314(b)	 	Inapplicable	 	
314(c)	 	13.06	 	
314(d)	 	Inapplicable	 	
314(e)	 	13.06	 	
314(f)	 	Inapplicable	 	
315(a)	 	7.01	 	
315(b)	 	5.04	 	
315(c)	 	7.01(a)	 	
315(d)	 	7.01(b)	 	
315(e)	 	6.07	 	
316(a)	 	6.06, 8.04	 	
316(b)	 	6.04	 	
316(c)	 	8.01	 	
317(a)	 	6.02	 	
317(b)	 	4.03	 	
318(a)	 	13.08	 	

*        This Cross-Reference Table does not constitute part of the Indenture and shall not have any bearing on the interpretation of any of its terms or provisions.
 
iv

 
THIS INDENTURE is dated as of September 25, 2007 among TYCO ELECTRONICS GROUP S.A., a Luxembourg company (the “ Company ”), TYCO ELECTRONICS LTD., a Bermuda company (“ Parent ”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation (the “ Trustee ”).
 
RECITALS
 
A.             This Indenture provides for the issuance of unsecured debt securities (the “ Securities ”), in an unlimited aggregate principal amount to be issued from time to time in one or more series, to be authenticated by the certificate of the Trustee, and for the issuance of guarantees of the Securities.
 
B.             This Indenture is subject to the provisions of the Trust Indenture Act (as defined below) that are deemed to be incorporated into this Indenture and shall, to the extent applicable, be governed by such provisions.
 
C.             All things necessary to make this Indenture a valid agreement, in accordance with its terms, have been done.
 
NOW, THEREFORE, in consideration of the premises and the purchase of the Securities by the holders thereof, it is mutually covenanted and agreed as follows for the equal and ratable benefit of the holders of Securities:
 
ARTICLE I.
 
DEFINITIONS
 
Section 1.01            Definitions of Terms .
 
The terms defined in this Section 1.01 (except as in this Indenture otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section 1.01 and shall include the plural as well as the singular. All other terms used in this Indenture that are defined in the Trust Indenture Act or that are by reference in the Trust Indenture Act defined in the Securities Act of 1933, as amended (the “ Securities Act ”) (except as herein otherwise expressly provided or unless the context otherwise requires), shall have the meanings assigned to such terms in the Trust Indenture Act and in the Securities Act as in force at the date of the execution of this instrument. All accounting terms used herein and not expressly defined shall have the meanings assigned to such terms in accordance with generally accepted accounting principles, and the term “ generally accepted accounting principles ” means such accounting principles as are generally accepted in the United States at the time of any computation.
 
“ 144A Global Security ”, with respect to any series of Securities, means one or more Global Securities, bearing the Private Placement Legend, that will be issued in an aggregate amount of denominations equal in total to the outstanding principal amount of the Securities of such series sold in global form in reliance on Rule 144A.

 
“ Additional Amounts ” has the meaning set forth in Section 14.02.
 
“ Affiliate ”, with respect to 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 ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
 
“ Applicable Procedures ”, with respect to any transfer or exchange of or for beneficial interests in any Global Security for a series of Securities, means the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer or exchange at the relevant time.
 
“ Authenticating Agent ” means an authenticating agent with respect to all or any of the series of Securities appointed with respect to all or any series of the Securities by the Trustee pursuant to Section 2.10.
 
“ Board of Directors ” means the Board of Directors of the Company or Parent, as applicable, or any duly authorized committee of such Board of Directors.
 
“ Board Resolution ” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company or Parent to have been duly adopted by its Board of Directors and to be in full force and effect on the date of such certification.
 
“ Business Day ”, with respect to any series of Securities, means any day other than Saturday, Sunday or a day on which Federal or State banking institutions in the Borough of Manhattan, The City of New York, or in the city where the office or agency for payment on the Securities is maintained pursuant to Section 4.02, are authorized or obligated by law, executive order or regulation to close.
 
“ Capital Stock ” of any Person means any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person’s capital stock, other equity interests whether now outstanding or issued after the date of this Indenture, partnership interests (whether general or limited), any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person and any rights (other than debt securities convertible into Capital Stock), warrants or options exchangeable for or convertible into such Capital Stock.
 
“ Clearstream ” means Clearstream Banking S.A., or its successors.
 
“ Commission ” means the Securities and Exchange Commission.
 
“ Company ” means Tyco Electronics Group S.A. until a successor entity shall have become such pursuant to Article X, and thereafter “Company” shall mean such successor entity.
 
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“ Corporate Trust Office ” means the office of the Trustee at which, at any particular time, its corporate trust business shall be principally administered, which office at the date hereof is located at 60 Wall Street, 27th Floor, New York, NY 10005.
 
“ Currency ” means Dollars or Foreign Currency.
 
“ Default ” means any event, act or condition that with notice or lapse of time, or both, would constitute an Event of Default.
 
“ Defaulted Interest ” has the meaning set forth in Section 2.03.
 
“ Definitive Security ” means a certificated Security registered in the name of the Securityholder thereof and issued in accordance with Section 2.05.
 
“ Depositary ”, with respect to Securities of any series which the Company shall determine will be issued in whole or in part as a Global Security, means The Depository Trust Company (“ DTC ”), New York, New York, another clearing agency, or any successor registered as a clearing agency under the Exchange Act, and any other applicable U.S. or foreign statute or regulation, which, in each case, shall be designated by the Company pursuant to Section 2.01.
 
“ Designated Currency ” has the meaning set forth in Section 2.15.
 
“ Distribution Compliance Period ” means the restricted period as defined in Rule 903(b)(3) under the Securities Act.
 
“ Dollar ” or “ $ ” means such currency of the United States as at the time of payment is legal tender for the payment of public and private debts.
 
“ Dollar Equivalent ” means, with respect to any monetary amount in a Foreign Currency, at any time for the determination thereof, the amount of Dollars obtained by converting such Foreign Currency involved in such computation into Dollars at the spot rate for the purchase of Dollars with the applicable Foreign Currency as quoted by JPMorgan Chase Bank, N.A. (unless another comparable financial institution is designated by the Company) in New York, New York, at approximately 11:00 a.m. (New York time) on the date two business days prior to such determination.
 
“ Euroclear ” means Euroclear Bank S.A./N.V., or its successor, as operator of the Euroclear System.
 
“ Event of Default ”, with respect to Securities of a particular series, means any event specified in Section 6.01, continued for the period of time, if any, therein designated.
 
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
 
“ Foreign Currency ” means a currency issued by the government of any country other than the United States or a composite currency the value of which is determined by reference to the values of the currencies of any group of countries.
 
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“ Global Security ”, with respect to any series of Securities, means a Security executed by the Company and delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction, all in accordance with this Indenture, which shall be registered in the name of the Depositary or its nominee.
 
“ Governmental Obligations ” means securities that are (i) direct obligations of the United States for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States that, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian with respect to any such Governmental Obligation or a specific payment of principal of or interest on any such Governmental Obligation held by such custodian for the account of the holder of such depositary receipt; provided, however, that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the Governmental Obligation or the specific payment of principal of or interest on the Governmental Obligation evidenced by such depositary receipt.
 
“ Guarantee ” means the unconditional and unsubordinated guarantee by Parent of the due and punctual payment of principal of and interest on a series of Securities when and as the same shall become due and payable, whether at the stated maturity, by acceleration, call for redemption or otherwise in accordance with the terms of the Securities and this Indenture.
 
“ herein ,” “ hereof ” and “ hereunder ,” and other words of similar import, refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.
 
“including” means including without limitation.
 
“ 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 in accordance with the terms hereof.
 
“ Indirect Participant ” means any entity that, with respect to DTC, clears through or maintains a direct or indirect, custodial relationship with a Participant.
 
“ Institutional Accredited Investor ” means an institution that is an “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act, who is not also a QIB.
 
“ Interest Payment Date, ” when used with respect to any installment of interest on a Security of a particular series, means the date specified herein, in such Security or in a Board Resolution or in an indenture supplemental hereto with respect to such series as the fixed date on which an installment of interest with respect to Securities of that series is due and payable.
 
“ Officer ” means any managing director, the chairman or any vice chairman of the Board of Directors, the chief executive officer, the president, the chief financial officer, any vice president, the treasurer, any assistant treasurer, the secretary or any assistant secretary of the Company or Parent, as the case may be.
 
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“ Officer’s Certificate ” means a certificate, signed by any managing director or by the chairman or any vice chairman of the Board of Directors, or the chief executive officer, president, chief financial officer or vice president or  the secretary or any assistant secretary or the treasurer or any assistant treasurer of the Company or Parent, as the case may be, that is delivered to the Trustee in accordance with the terms hereof. Each such certificate shall include the statements provided for in Section 13.06, if and to the extent required by the provisions thereof.
 
“ Opinion of Counsel ” means an opinion in writing of legal counsel, who may be an Officer or employee of or counsel for Parent or the Company that is delivered to the Trustee in accordance with the terms hereof. Each such opinion shall include the statements provided for in Section 13.06, if and to the extent required by the provisions thereof.
 
“ Original Issue Discount Security ” means a Security that 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 6.01.
 
“ Outstanding ”, when used with reference to Securities of any series, subject to the provisions of Section 8.04, means, as of any particular time, all Securities of such series authenticated and delivered by the Trustee under this Indenture, except
 
(a)            Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation;
 
(b)            Securities, or portions thereof, for the payment or redemption of which funds in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent other than the Company, or, if the Company shall act as its own paying agent, shall have been set aside, segregated and held in trust by the Company for the Holders of such Securities, provided that if such Securities, or portions thereof, are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as herein provided, or provision satisfactory to the Trustee shall have been made for giving such notice; and
 
(c)            Securities in substitution for which other Securities shall have been authenticated and delivered, or which shall have been paid, pursuant to the terms of Section 2.07, except with respect to any such Security as to which proof satisfactory to the Trustee is presented that such Security is held by a person in whose hands such Security is a legal, valid and binding obligation of the Company.
 
In determining whether the holders of the requisite principal amount of Outstanding Securities of any series have given any request, demand, authorization, direction, notice, consent or waiver hereunder, 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 6.01 and the principal amount of a Security denominated in one or more currencies that shall be deemed to be Outstanding for such purposes
 
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shall be based on the Dollar Equivalent on the date of original issuance of such Security, of the principal amount of such Security.
 
“ Parent ” means Tyco Electronics Ltd. until a successor entity shall have become such pursuant to Article X, and thereafter “Parent” shall mean such successor entity.
 
“ Participant ”, with respect to the Depositary, Euroclear or Clearstream, means a Person who has an account with the Depositary, Euroclear or Clearstream, respectively (and, with respect to DTC, shall include Euroclear and Clearstream).
 
“ Periodic Offering ” means an offering of Securities of a series from time to time, during which any or all of the specific terms of the Securities, including the rate or rates of interest, if any, thereon, the maturity or maturities thereof and the redemption provisions, if any, with respect thereto, are to be determined by the Company or its agents upon the issuance of such Securities in accordance with the terms of the relevant Supplemental Indenture.
 
“ Person ” means any individual, corporation, limited liability company, partnership, joint venture, joint-stock company, unincorporated organization or government or any agency or political subdivision thereof.
 
“ 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 2.07 in lieu of a lost, destroyed or stolen Security shall be deemed to evidence the same debt as the lost, destroyed or stolen Security.
 
“ Private Placement Legend ” means the legend set forth in Section 2.02(b) to be placed on all Restricted Securities issued under this Indenture or pursuant to a Board Resolution or an indenture supplemental hereto with respect to a series of Securities, except where specifically stated otherwise by the provisions of this Indenture, such Board Resolution or such supplemental indenture.
 
“ QIB ” means a “qualified institutional buyer” as defined in Rule 144A.
 
“ Regulation S Global Security ” means, with respect to any series of Securities, a Regulation S Temporary Global Security of such series, if required by Rule 903 of Regulation S, or a Regulation S Permanent Global Security of such series, as the case may be.
 
“ Regulation S Permanent Global Security ”, with respect to any series of Securities, means one or more permanent Global Securities, bearing the Private Placement Legend, that will be issued in an aggregate amount of denominations equal in total to the outstanding principal amount of the Securities of such series initially sold or, if required by Rule 903 of Regulation S, of the Regulation S Temporary Global Security of such series upon expiration of the Distribution Compliance Period with respect to such series, as the case may be.
 
“ Regulation S Temporary Global Security ”, with respect to any series of Securities, means one or more temporary Global Securities, bearing the Private Placement Legend, and the Regulation S Temporary Global Security Legend issued in an aggregate amount of
 
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denominations equal in total to the outstanding principal amount of the Securities of such series initially sold, if required by Rule 903 of Regulation S.
 
“ Regulation S Temporary Global Security Legend ” means the legend set forth in Section 2.02(d), which is required to be placed on all Regulation S Temporary Global Securities issued under this Indenture.
 
“ Regulation S ” means Regulation S promulgated under the Securities Act, as it may be amended from time to time, and any successor provision thereto.
 
“ Responsible Officer ” means any vice president, any trust officer, any assistant trust officer, any assistant vice president, any assistant treasurer, or any other officer of the Trustee customarily performing 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 his knowledge of and familiarity with the particular subject.
 
“ Restricted Definitive Security ”, with respect to any series of Securities, means one or more Definitive Securities of such series bearing the Private Placement Legend issued under this Indenture.
 
“ Restricted Global Security ”, with respect to any series of Securities, means one or more Global Securities of such series bearing the Private Placement Legend, issued under this Indenture.
 
“ Restricted Security ”, with respect to any series of Securities, means a Security of such series, unless or until it has been (i) effectively registered under the Securities Act and disposed of in accordance with a registration statement with respect to such series or (ii) distributed to the public pursuant to Rule 144 under the Securities Act (or any similar provision then in force).
 
“ Rule 144A ” means Rule 144A promulgated under the Securities Act, as it may be amended from time to time, and any successor provision thereto.
 
“ Securities ” means the securities authenticated and delivered under this Indenture.
 
“ Securityholder, ” “ Holder, ” “ holder of Securities, ” “ registered holder, ” or other similar term, means the Person or Persons in whose name or names a particular Security shall be registered on the books of the Company kept for that purpose in accordance with the terms of this Indenture.
 
“ Security Register ” has the meaning set forth in Section 2.05(a).
 
“ Security Registrar ” has the meaning set forth in Section 2.05(a).
 
“ Stated Maturity ”, with respect to any Security, means the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the
 
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happening of any contingency beyond the control of the issuer unless such contingency has occurred).
 
“ Subsidiary ”, with respect to any Person, means any other Person of which at least a majority of the outstanding Voting Stock at the time is owned or controlled directly or indirectly by such Person or by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person.
 
“ Taxes ” has the meaning set forth in Section 14.02.
 
“ Taxing Jurisdiction ” has the meaning set forth in Section 14.01.
 
“ Trustee ” means Deutsche Bank Trust Company Americas and, subject to the provisions of Article VII, shall include its successors and assigns. The term “Trustee” as used with respect to a particular series of the Securities shall mean the trustee with respect to that series.
 
“ Trust Indenture Act ” means the Trust Indenture Act of 1939, as amended, as in effect at the date of execution of this instrument subject to the provisions of Sections 9.01, 9.02, and 10.01.
 
“ Unrestricted Definitive Security ”, with respect to any series of Securities, means one or more Definitive Securities representing such series of Securities that do not bear and are not required to bear the Private Placement Legend, issued under this Indenture.
 
“ Unrestricted Global Security ”, with respect to any series of Securities, means one or more permanent Global Securities representing such series of Securities that do not bear and are not required to bear the Private Placement Legend, issued under this Indenture.
 
“ Unrestricted Securities ”, with respect to any series of Securities, means a Security (i) effectively registered under the Securities Act and disposed of in accordance with a registration statement with respect to such series or (ii) distributed to the public pursuant to Rule 144 under the Securities Act (or any similar provision then in force).
 
“ Voting Stock ” of a Person means Capital Stock of such Person of the class or classes pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of such Person, irrespective of whether or not at the time Capital Stock of any other class or classes shall have or might have voting power by reason of the happening of any contingency.
 
ARTICLE II.
 
ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION AND
EXCHANGE OF SECURITIES
 
Section 2.01            Designation and Terms of Securities .
 
(a)            The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series
 
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up to the aggregate principal amount of Securities of that series from time to time authorized by or pursuant to a Board Resolution of the Company or pursuant to one or more indentures supplemental hereto. Prior to the initial issuance of Securities of any series, there shall be established in or pursuant to a Board Resolution of the Company, and set forth in an Officer’s Certificate of the Company, or established in one or more indentures supplemental hereto, with respect to the Securities of the series:
 
(1)            the title of the Security of the series (which shall distinguish the Securities of the series from all other Securities);
 
(2)            any limit upon the aggregate principal amount of the Securities of that series that 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);
 
(3)            the date or dates on which the principal and premium, if any, of the Securities of the series is payable;
 
(4)            the rate or rates (which may be fixed or variable) at which the Securities of the series shall bear interest or the manner of calculation of such rate or rates, if any (including any procedures to vary or reset such rate or rates), and the basis upon which interest will be calculated if other than that of a 360 day year of twelve 30-day months;
 
(5)            the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest will be payable or the manner of determination of such Interest Payment Dates, and the record date for the determination of holders to whom interest is payable on any such Interest Payment Dates;
 
(6)            any trustees, authenticating agents or paying agents with respect to such series, if different from those set forth in this Indenture;
 
(7)            the right, if any, to extend the interest payment periods or defer the payment of interest and the duration of such extension or deferral;
 
(8)            the period or periods within which, the price or prices at which and the terms and conditions upon which, Securities of the series may be redeemed, in whole or in part, at the option of the Company;
 
(9)            the obligation, if any, of the Company to redeem, purchase or repay Securities of the series pursuant to any sinking fund or analogous provisions (including payments made in cash in anticipation of future sinking fund obligations) 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 the series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation;
 
(10)          the form of the Securities of the series including the form of the Trustee’s certificate of authentication for such series;
 
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(11)          if other than denominations of $1,000 or any integral multiple thereof, the denominations in which the Securities of the series shall be issuable;
 
(12)          the Currency or Currencies in which payment of the principal of, premium, if any, and interest on, Securities of the series shall be payable;
 
(13)          if the principal amount payable at the Stated Maturity of Securities of the series will not be determinable as of any one or more dates prior to such Stated Maturity, the amount which will be deemed to be such principal amount as of any such date for any purpose, including the principal amount thereof which will be due and payable upon any maturity other than the Stated Maturity or which will be deemed to be Outstanding as of any such date (or, in any such case, the manner in which such deemed principal amount is to be determined);
 
(14)          the terms of any repurchase or remarketing rights;
 
(15)          if the Securities of the series shall be issued in whole or in part in the form of a Global Security or Securities, the type of Global Security to be issued; the terms and conditions, if different from those contained in this Indenture, upon which such Global Security or Securities may be exchanged in whole or in part for other individual Securities in definitive registered form; the Depositary for such Global Security or Securities; and the form of any legend or legends to be borne by any such Global Security or Securities in addition to or in lieu of the legends referred to in Section 2.02;
 
(16)          whether the Securities of the series will be convertible into or exchangeable for other Securities, common shares or other securities of any kind of the Company or another obligor, and, if so, the terms and conditions upon which such Securities will be so convertible or exchangeable, including the initial conversion or exchange price or rate or the method of calculation, how and when the conversion price or exchange ratio may be adjusted, whether conversion or exchange is mandatory, at the option of the holder or at the Company’s option, the conversion or exchange period, and any other provision in addition to or in lieu of those described herein;
 
(17)          if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.01;
 
(18)          any additional restrictive covenants or Events of Default that will apply to the Securities of the series, or any changes to the restrictive covenants set forth in Article IV or the Events of Default set forth in Section 6.01 that will apply to the Securities of the series, which may consist of establishing different terms or provisions from those set forth in Article IV or Section 6.01 or eliminating any such restrictive covenant or Event of Default with respect to the Securities of the series;
 
(19)          any provisions granting special rights to holders when a specified event occurs;
 
(20)          if the amount of principal or any premium or interest on Securities of a series may be determined with reference to an index or pursuant to a formula, the manner in
 
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which such amounts will be determined;
 
(21)          any special tax implications of the Securities, including provisions for original issue discount securities, if offered;
 
(22)          whether and upon what terms Securities of a series may be defeased if different from the provisions set forth in this Indenture;
 
(23)          with regard to the Securities of any series that do not bear interest, the dates for certain required reports to the Trustee;
 
(24)          whether the Securities of the series will be issued as Unrestricted Securities or Restricted Securities, and, if issued as Restricted Securities, the rule or regulation promulgated under the Securities Act in reliance on which they will be sold; and
 
(25)          any and all additional, eliminated or changed terms that shall apply to the Securities of the series, including any terms that may be required by or advisable under United States laws or regulations (including the Securities Act and the rules and regulations promulgated thereunder) or advisable in connection with the marketing of Securities of that series.
 
(b)            All Securities of any one series shall be substantially identical, except that Securities of any particular series may be issued at various times, in different denominations, with different currency of payments due thereunder, with different dates on which the principal or any installment of principal is payable, with different rates of interest, if any, or different methods by which rates of interest may be determined, with different dates from which such interest may accrue or on which such interest may be payable, and with different redemption dates, and except as may otherwise be provided in or pursuant to any such Board Resolution or in any supplemental indenture. If any of the terms of the series are established by action taken pursuant to a Board Resolution of the Company, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officer’s Certificate of the Company setting forth the terms of the series. The terms of the Securities of any series may provide that such Securities shall be authenticated and delivered by the Trustee upon original issuance from time to time upon written order of persons designated in such Board Resolution or supplemental indenture and that such persons are authorized to determine, consistent with such Board Resolution or supplemental indenture, such terms and conditions of the Securities of such series.
 
Section 2.02            Form of Securities and Trustee’s Certificate .
 
(a)            The Securities of any series and the Trustee’s certificate of authentication to be borne by such Securities shall be substantially of the tenor as set forth in an indenture supplemental hereto or as provided in a Board Resolution of the Company and as set forth in an Officer’s Certificate of the Company and may have such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, any Board Resolution or any indenture supplemental hereto, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any
 
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rule or regulation of any stock exchange on which Securities of that series may be listed, or to conform to usage.
 
(b)            Each Restricted Security (and all Restricted Securities issued in exchange therefor or substitution thereof) shall bear a Private Placement Legend in substantially the following form:
 
“THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”). THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
 
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.”
 
(c)            To the extent required by the Depositary for particular series of Securities, each Global Security of such series shall bear legends in substantially the following forms:
 
“THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE ANY SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED
 
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IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.05(C) OF THE INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.”
 
“UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY 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 TO 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 THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF ANY ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO SUCH ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.”
 
(d)            To the extent required by the Depositary, each Regulation S Temporary Global Security shall bear a legend in substantially the following form:
 
“THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE SECURITIES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY SECURITY SHALL BE ENTITLED TO RECEIVE CASH PAYMENTS OF INTEREST DURING THE PERIOD WHICH SUCH HOLDER HOLDS THIS SECURITY. NOTHING IN THIS LEGEND SHALL BE DEEMED TO PREVENT INTEREST FROM ACCRUING ON THIS SECURITY.”
 
Section 2.03            Denominations; Provisions for Payment .
 
The Securities shall be issuable as registered Securities and in the denominations of $1,000 or any integral multiple thereof, subject to Section 2.01(a)(11). The Securities of a particular series shall bear interest payable on the dates and at the rate specified as provided in Section 2.01 with respect to that series. The principal of and the interest on the Securities of any series, as well as any premium thereon in case of redemption thereof prior to maturity, shall be
 
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payable in Dollars except as otherwise specified pursuant to Section 2.01(a)(12), at the office or agency of the Company maintained for that purpose pursuant to Section 4.02. Each Security shall be dated the date of its authentication. Unless otherwise specified with respect to a series of Securities in accordance with the provisions of Section 2.01(a)(4), interest on the Securities shall be computed on the basis of a 360-day year composed of twelve 30-day months.
 
The interest installment on any Security that is payable, and is punctually paid or duly provided for, on any Interest Payment Date for Securities of that series shall be paid to the Person in whose name said Security (or one or more Predecessor Securities) is registered at the close of business on the regular record date for such interest installment. In the event that any Security of a particular series or portion thereof is called for redemption and the redemption date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Security will be paid upon presentation and surrender of such Security as provided in Section 3.03.
 
Unless otherwise set forth in a Board Resolution or one or more indentures supplemental hereto establishing the terms of any series of any Securities pursuant to Section 2.01, the term “regular record date” as used in this Section 2.03 with respect to a series of Securities shall mean a date 15 days immediately preceding any Interest Payment Date. Subject to the provisions of this Section 2.03, each Security of a series delivered under this Indenture upon registration of transfer or in exchange for or in lieu of any other Security of such series shall carry the rights to interest accrued and unpaid, and to accrue, that were carried by such other Security.
 
Unless otherwise specified with respect to a series of Securities in accordance with the provisions of Section 2.01, any interest on any Security that is payable, but is not punctually paid or duly provided for, on any Interest Payment Date for such Security (“ Defaulted Interest ”) shall forthwith cease to be payable to the registered holder on the relevant regular record date, and such Defaulted Interest shall be paid by the Company, at its election, as provided in clause (1) or clause (2) below.
 
(1)            The Company may make payment of any Defaulted Interest on Securities to the Persons in whose names such Securities (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 in writing of the amount of Defaulted Interest proposed to be paid on each such Security and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee funds in an amount equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such funds when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause (1). Thereupon the Trustee shall fix a special record date for the payment of such Defaulted Interest which shall not be more than 15 nor less than ten days prior to the date of the proposed payment and not less than ten days after the receipt by the Trustee of the notice of the proposed payment. The Trustee promptly shall 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
 
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postage prepaid, to each Securityholder at his or her address as it appears in the Security Register, not less than ten days prior to such special record date. Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered on such special record date and shall not be payable pursuant to the following clause (2).
 
(2)            The Company may make payment of any Defaulted Interest on any Securities 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.
 
Section 2.04            Execution and Authentications .
 
The Securities shall be signed on behalf of the Company by any member of the Board of Directors of the Company or by both (a) its president, chief financial officer or vice president and (b) its secretary, any assistant secretary, its treasurer or any assistant treasurer. Signatures may be in the form of a manual or facsimile signature. In the case of Definitive Securities of any series, such signatures may be imprinted or otherwise reproduced on such Securities. The Securities may contain such notations, legends or endorsements required by law, stock exchange rule or usage. Each Security shall be dated the date of its authentication by the Trustee.
 
A Security shall not be valid until authenticated manually by an authorized signatory of the Trustee or by an Authenticating Agent. Such signature shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture. 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, with the form of Guarantee thereon executed by Parent, to the Trustee for authentication, together with a written order of the Company for the authentication and delivery of such Securities, signed by an Officer (an “ Authentication Order ”), and the Trustee in accordance with such written order shall authenticate and deliver such Securities.
 
Notwithstanding the provisions of Section 2.01 and the preceding paragraph, in the case of Securities offered in a Periodic Offering, the Trustee shall authenticate and deliver such Securities from time to time in  accordance with instructions or such other procedures acceptable to the Trustee as may be specified by or pursuant to a supplemental indenture or the written order of the Company delivered to the Trustee prior to the time of the first authentication of Securities of such series. With respect to Securities of a series subject to a Periodic Offering, the Trustee may conclusively rely, as to the authorization by the Company of any of such Securities, the forms and terms thereof and the legality, validity, binding effect and enforceability thereof, upon the written order of the Company, Opinion of Counsel, Officer’s Certificate and other documents delivered pursuant to this Section 2.04 at or prior to the time of the first authentication of Securities of such series unless and until such written order, Opinion of Counsel, Officer’s Certificate or other documents have been superseded or revoked or expire by their terms.
 
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Section 2.05            Transfer and Exchange .
 
(a)            Registration of Transfer and Exchange . The Company shall keep, or cause to be kept, at its office or agency designated for such purpose as provided in Section 4.02, a register or registers (the “ Security Register ”) in which, subject to such reasonable regulations as it may prescribe, the Company shall register the Securities and the transfers of Securities as provided in this Article II and which at all reasonable times shall be open for inspection by the Trustee. The registrar for the purpose of registering Securities and the transfer of Securities as herein provided shall be appointed as authorized by Board Resolution (the “ Security Registrar ”). If the Company fails to appoint or maintain another entity as Security Registrar, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Security Registrar.
 
To permit registrations of transfers and exchanges, the Company shall execute a new Security or Securities of the same series as the Security presented for a like aggregate principal amount and in authorized denominations, and Parent shall execute the form of Guarantee or Guarantees thereon, and the Trustee shall authenticate and deliver such Security or Securities upon receipt of an Authentication Order. The Trustee shall not be required to register the transfer of or exchange any Security selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.
 
All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company and Parent, evidencing the same indebtedness, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange. Prior to such due presentment for the registration of a transfer of any Security, the Trustee, the Company, any paying agent and the Security Registrar may deem and treat the Person in whose name any Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Securities and for all other purposes, and none of the Trustee, the Company, the paying agent or the Security Registrar shall be affected by notice to the contrary.
 
All certifications, certificates and opinions of counsel required to be submitted to the Trustee pursuant to this Section 2.05 to effect a registration of transfer or exchange may be submitted by facsimile.
 
(b)            Service Charge . No service charge shall be payable by a holder of a beneficial interest in a Global Security or by a Holder of a Definitive Security for any exchange or registration of transfer of Securities, or for any issue of new Securities in case of partial redemption of any series, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge in relation thereto (other than any such taxes or other governmental charge payable upon exchange or registration of transfer pursuant to Sections 2.06, 3.03(b) and 9.04).
 
(c)            Transfer and Exchange of Global Securities . A Global Security may not be transferred except as a whole by the Depositary for a series of the Securities to a nominee of such Depositary, by a nominee of such Depositary to such Depositary or to another nominee of such Depositary or by such Depositary or any such nominee to a successor Depositary for a series of the Securities or a nominee of such successor Depositary. If at any time the Depositary for a
 
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series of the Securities notifies the Company that it is unwilling or unable to continue as Depositary for such series or if at any time the Depositary for such series shall no longer be registered or in good standing under the Exchange Act or other applicable statute or regulation, and a successor Depositary for such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, the provisions of Section 2.11 shall no longer be applicable to the Securities of such series. In addition, the Company may at any time determine that the Securities of any series shall no longer be represented by a Global Security and that the provisions of Section 2.11 shall no longer apply to the Securities of such series. In either such event the Company will execute the Definitive Securities of such series, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security of such series, and Parent will execute the form of Guarantees thereon, and subject to this Section 2.05 the Trustee, upon receipt of an Officer’s Certificate evidencing such determination by the Company, if applicable, will authenticate and deliver such Definitive Securities in exchange for such Global Security. Upon the exchange of the Global Security of such series for such Definitive Securities of such series, the Global Security shall be canceled by the Trustee. Such Definitive Securities shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its Participants or Indirect Participants or otherwise, shall in writing instruct the Trustee. The Trustee shall deliver such Securities to the Depositary for delivery to the Persons in whose names such Securities are so registered.
 
Except as provided in Sections 2.06 and 2.07, a Global Security may not be exchanged for another Security other than as provided in this Section 2.05(c); however, beneficial interests in a Global Security may be transferred and exchanged as provided in Section 2.05(d) or (e). The provisions of this Section 2.05(c) are subject to Section 2.11.
 
(d)                                Transfer and Exchange of Beneficial Interests in the Global Securities . The transfer and exchange of beneficial interests in the Global Securities of a series shall be effected through the Depositary, in accordance with the provisions of this Indenture, any Board Resolution and any one or more indentures supplemental hereto, and the Applicable Procedures. Beneficial interests in the Restricted Global Securities of a series shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in the Global Securities also shall require compliance with either subparagraph (1) or (2) below, as applicable, as well as one or more of the other following subparagraphs, as applicable:
 
(1)            Transfer of Beneficial Interests in the Same Global Security . Beneficial interests in any Restricted Global Security of a series may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Security in accordance with the transfer restrictions set forth in the Private Placement Legend. Beneficial interests in any Unrestricted Global Security of a series may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security of such series. Subject to Section 2.05(e)(4), no written orders or instructions shall be required to be delivered to the Security Registrar to effect the transfers described in this Section 2.05(d)(1).
 
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(2)            All Other Transfers and Exchanges of Beneficial Interests in Global Securities . In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.05(d)(1) above, the transferor of such beneficial interest must deliver to the Security Registrar, as applicable, either:
 
(A)(1) an order from a Participant or an Indirect Participant given to the Depositary in accordance with the relevant Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Security of such series in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the relevant Applicable Procedures containing information regarding the Participant account to be credited with such increase; or
 
(B)(1) an order from a Participant or an Indirect Participant given to the Depositary in accordance with the relevant Applicable Procedures directing the Depositary to cause to be issued a Definitive Security of such series in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given by the Depositary to the Security Registrar containing information regarding the Person in whose name such Definitive Security shall be registered to effect the transfer or exchange referred to in (B)(1) above;
 
provided that in no event shall Definitive Securities of a series be issued upon the transfer or exchange of beneficial interests in the Regulation S Temporary Global Security of such series prior to (y) the expiration of the relevant Distribution Compliance Period and (z) the receipt by the Security Registrar of any certificates identified by the Company or its counsel to be required pursuant to Rule 903 and Rule 904 under the Securities Act. Upon satisfaction of all the requirements for transfer and exchange of beneficial interests in Global Securities of a series contained in this Indenture, any Board Resolution, or one or more indentures supplemental hereto and the Securities of such series or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Security or Securities of such series pursuant to Section 2.05(h).
 
(3)            Transfer of Beneficial Interests to Another Restricted Global Security . A beneficial interest in any Restricted Global Security of a series may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Security of the same series if the transfer complies with the requirements of Section 2.05(d)(2) and the Security Registrar receives a completed certificate in the form of Exhibit A.
 
(4)            Transfer and Exchange of Beneficial Interests in a Restricted Global Security for Beneficial Interests in an Unrestricted Global Security . A beneficial interest in any Restricted Global Security of any series may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Security of such series or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security of such series if the exchange or transfer complies with the requirements of Section 2.05(d)(2) above and the Security Registrar receives a completed certificate from such holder in the form of Exhibit A or Exhibit B, as applicable, and an opinion of
 
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counsel in form, and from legal counsel, reasonably acceptable to the Security Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
 
If any such transfer is effected at a time when an Unrestricted Global Security of such series has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.04, the Trustee shall authenticate one or more Unrestricted Global Securities of such series in an aggregate principal amount equal to the aggregate principal amount of beneficial interests so transferred. Beneficial interests in an Unrestricted Global Security of a series cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted Global Security of such series.
 
(e)            Transfer or Exchange of Beneficial Interests for Definitive Securities .
 
(1)            Beneficial Interests in Restricted Global Securities to Restricted Definitive Securities . If any holder of a beneficial interest in a Restricted Global Security of a series proposes to exchange such beneficial interest for a Restricted Definitive Security of such series or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Security of such series, then, upon receipt by the Security Registrar of a completed certificate from such holder in the form of Exhibit A or Exhibit B, as applicable, and certificates and opinions of counsel, if applicable, the Trustee shall cause the aggregate principal amount of the applicable Restricted Global Security of such series to be reduced accordingly pursuant to Section 2.05(h), and the Company shall execute a Restricted Definitive Security of such series in the appropriate principal amount, and Parent shall execute the form of Guarantee thereon, and, upon receipt of an Authentication Order pursuant to Section 2.04, the Trustee shall authenticate and deliver to the Person designated in the instructions such Restricted Definitive Security. Any Restricted Definitive Security of such series issued in exchange for a beneficial interest in a Restricted Global Security of such series pursuant to this Section 2.05(e) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Security Registrar through instructions from the Depositary for such series and the Participant or Indirect Participant. The Trustee shall deliver such Restricted Definitive Securities of such series to the Persons in whose names such Securities are so registered. Any Restricted Definitive Security of such series issued in exchange for a beneficial interest in a Restricted Global Security of such series pursuant to this Section 2.05(e)(1) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.
 
(2)            Beneficial Interests in Restricted Global Securities to Unrestricted Definitive Securities . A holder of a beneficial interest in a Restricted Global Security of a series may exchange such beneficial interest for an Unrestricted Definitive Security of such series or may transfer such beneficial interest to a Person who takes delivery thereof
 
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in the form of an Unrestricted Definitive Security of such series only if the Security Registrar receives a completed certificate from such holder in the form of Exhibit A or Exhibit B, as applicable, and an opinion of counsel in form, and from legal counsel, reasonably acceptable to the Security Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
 
(3)            Beneficial Interests in Unrestricted Global Securities to Unrestricted Definitive Securities . If any holder of a beneficial interest in an Unrestricted Global Security of a series proposes to exchange such beneficial interest for an Unrestricted Definitive Security of such series or to transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security of such series, then, upon satisfaction of the conditions set forth in Section 2.05(d)(2), the Trustee shall cause the aggregate principal amount of the applicable Unrestricted Global Security of such series to be reduced accordingly pursuant to Section 2.05(h), and the Company shall execute an Unrestricted Definitive Security of such series in the appropriate principal amount, and Parent shall execute the form of Guarantee thereon, and, upon receipt of an Authentication Order in accordance with Section 2.04, the Trustee shall authenticate and deliver to the Person designated in the instructions such Unrestricted Definitive Security. Any Unrestricted Definitive Security issued in exchange for a beneficial interest pursuant to this Section 2.05(e)(3) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Security Registrar through instructions from the Depositary for such series and the Participant or Indirect Participant. The Trustee shall deliver such Unrestricted Definitive Securities to the Persons in whose names such Securities are so registered. Any Unrestricted Definitive Security issued in exchange for a beneficial interest pursuant to this Section 2.05(e)(3) shall not bear the Private Placement Legend.
 
(4)            Transfer or Exchange of Regulation S Temporary Global Securities. Notwithstanding the other provisions of this Section 2.05, a beneficial interest in the Regulation S Temporary Global Security of a series may not be (A) exchanged for a Definitive Security of such series prior to (y) the expiration of the Distribution Compliance Period with respect to such series (unless such exchange is effected by the Company, does not require an investment decision on the part of the Holder thereof and does not violate the provisions of Regulation S) and (z) the receipt by the Security Registrar of any certificates identified by the Company or its counsel to be required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act or (B) transferred to a U.S. person (as such term is defined in Regulation S) or for the account or benefit of a U.S. person (other than an initial purchaser of such Regulation S Temporary Global Security) or a Person who takes delivery thereof in the form of a Definitive Security of such series prior to the events set forth in clause (A) above or unless the transfer is pursuant to an exemption from the registration requirements of the Securities Act other than Rule 903 or 904.
 
(f)             Transfer and Exchange of Definitive Securities for Beneficial Interests .
 
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(1)            Restricted Definitive Securities to Beneficial Interests in Restricted Global Securities . If any Holder of a Restricted Definitive Security of a series proposes to exchange such Security for a beneficial interest in a Restricted Global Security of such series or to transfer such Restricted Definitive Securities of such series to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Security of such series, then, upon receipt by the Trustee of the following documentation:
 
(A) if the Holder of such Restricted Definitive Security of such series proposes to exchange such Security for a beneficial interest in a Restricted Global Security of such series, a completed certificate from such holder in the form of Exhibit B; or
 
(B) if such Restricted Definitive Security is being transferred to a QIB in accordance with Rule 144A under the Securities Act or to a non-U.S. person in an offshore transaction in accordance with Rule 903 or 904 under the Securities Act, a completed certificate to that effect set forth in Exhibit A,
 
the Trustee shall cancel the Restricted Definitive Security of such series, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Security of such series and, in the case of clause (B) above, the 144A Global Security of such series or the Regulation S Global Security of such series as applicable.
 
(2)            Restricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities . A Holder of a Restricted Definitive Security of a series may exchange such Security for a beneficial interest in an Unrestricted Global Security of such series or transfer such Restricted Definitive Security of such series to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security of such series only if the Security Registrar receives a completed certificate from such Holder in the form of Exhibit A or Exhibit B, as applicable, and an opinion of counsel in form, and from legal counsel, reasonably acceptable to the Security Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. Upon satisfaction of the conditions of any of the subparagraphs in this Section 2.05(f)(2), the Trustee shall cancel the Restricted Definitive Securities of such series so transferred or exchanged and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Security of such series.
 
(3)            Unrestricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities . A Holder of an Unrestricted Definitive Security of a series may exchange such Security for a beneficial interest in an Unrestricted Global Security of such series or transfer such Definitive Securities of such series to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security of such series at any time. Upon receipt of a written request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Security and increase or cause or be increased the aggregate principal amount of one of the
 
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Unrestricted Global Securities of such series. If any such exchange or transfer from a Definitive Security of a series to a beneficial interest is effected pursuant to subparagraphs (2) or (3) of this Section 2.05(f) at a time when an Unrestricted Global Security of such series has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.04, the Trustee shall authenticate one or more Unrestricted Global Securities of such series in an aggregate principal amount equal to the principal amount of Definitive Securities of such series so transferred.
 
(g)            Transfer and Exchange of Definitive Securities for Definitive Securities . Upon written request by a Holder of Definitive Securities of a series and such Holder’s compliance with the provisions of this Section 2.05(g), the Trustee shall register the transfer or exchange of Definitive Securities of such series pursuant to the provisions of Section 2.05(a). In addition to the requirements set forth in Section 2.05(a), the requesting Holder shall provide any additional certifications, documents, and information, as applicable, required pursuant to the following provisions of this Section 2.05(g).
 
(1)            Restricted Definitive Securities to Restricted Definitive Securities . Any Restricted Definitive Security of a series may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Security of such series if the Trustee receives a completed certificate in the form of Exhibit A, including the certifications, certificates and opinions of counsel required by item (3) thereof, if applicable.
 
(2)            Restricted Definitive Securities to Unrestricted Definitive Securities . Any Restricted Definitive Security of a series may be exchanged by the Holder thereof for an Unrestricted Definitive Security of such series or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Security of such series if the Security Registrar receives a completed certificate from such Holder in the form of Exhibit A or Exhibit B, as applicable and an opinion of counsel in form, and from legal counsel, reasonably acceptable to the Trustee and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
 
(3)            Unrestricted Definitive Securities to Unrestricted Definitive Securities . A Holder of Unrestricted Definitive Securities of a series may transfer such Securities to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security of such series in accordance with subsection 2.05(a). Upon receipt of a request to register such a transfer, the Security Registrar shall register the Unrestricted Definitive Securities of such series pursuant to the instructions from the Holder thereof.
 
(h)            Cancellation and/or Adjustment of Global Securities . At such time as all beneficial interests in a particular Global Security of a series have been exchanged for Definitive Securities of such series or a particular Global Security of a series has been redeemed, repurchased or cancelled in whole and not in part, each such Global Security of such series shall be returned to or retained and cancelled by the Trustee in accordance with Section 2.08. At any
 
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time prior to such cancellation, if any beneficial interest in a Global Security of such series is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security of such series or for Definitive Securities of such series, the principal amount of Securities of such series represented by such Global Security shall be reduced accordingly and an endorsement may be made on such Global Security by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security of such series, such other Global Security shall be increased accordingly and an endorsement may be made on such Global Security by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase.
 
(i)             No Exchange or Transfer . The Company shall not be required (i) to issue, exchange or register the transfer of any Securities during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all the Outstanding Securities of the same series and ending at the close of business on the day of such mailing, (ii) to register the transfer of or exchange any Securities of any series or portions thereof called for redemption, nor (iii) to register the transfer of or exchange a Security of any series between the applicable record date pursuant to Section 2.01(a)(5) and the next succeeding Interest Payment Date.
 
Section 2.06           Temporary Securities .
 
Pending the preparation of definitive Securities of any series, the Company may execute temporary Securities (printed, lithographed or typewritten) of any authorized denomination, and Parent shall execute the Guarantees thereon, and the Trustee shall authenticate and deliver such Securities. Such temporary Securities shall be substantially in the form of the definitive Securities in lieu of which they are issued, but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Company. Every temporary Security of any series shall be executed by the Company, with the form of Guarantee thereon executed by Parent, and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Securities of such series. Without unnecessary delay the Company will execute, and if applicable Parent will endorse, and will furnish definitive Securities of such series and thereupon any or all temporary Securities of such series may be surrendered in exchange therefor without charge to the holders, at the office or agency of the Company maintained pursuant to Section 4.02 for the purpose of exchanges of Securities of such series, and the Trustee shall authenticate and such office or agency shall deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities of such series, unless the Company advises the Trustee to the effect that definitive Securities need not be executed and furnished until further notice from the Company. Until so exchanged, temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series authenticated and delivered hereunder.
 
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Section 2.07            Mutilated, Destroyed, Lost or Stolen Securities .
 
In case any temporary or definitive Security shall become mutilated or be destroyed, lost or stolen, the Company (subject to the next succeeding sentence) shall execute a new Security of the same series, bearing a number not contemporaneously outstanding in exchange and substitution for the mutilated Security, or in lieu of and in substitution for the Security so destroyed, lost or stolen, and Parent shall execute the form of Guarantee thereon, and upon the Company’s written request the Trustee (subject to the next succeeding sentence) shall authenticate and deliver, such Security. In every case the applicant for a substituted Security shall furnish to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and the Trustee evidence to their satisfaction of the destruction, loss or theft of the applicant’s Security and of the ownership thereof. The Trustee may authenticate any such substituted Security and deliver the same upon the written request or authorization of any Officer. Upon the issuance of any substituted Security, 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) connected therewith. In case any Security that has matured or is about to mature shall become mutilated or be destroyed, lost or stolen, the Company, instead of issuing a substitute Security, may pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated Security) if the applicant for such payment shall furnish to the Company and the Trustee such security or indemnity as they may require to save them harmless, and, in case of destruction, loss or theft, evidence to the satisfaction of the Company and the Trustee of the destruction, loss or theft of such Security and of the ownership thereof.
 
Every replacement Security issued pursuant to the provisions of this Section 2.07 shall constitute an additional contractual obligation of the Company whether or not the mutilated, destroyed, lost or stolen Security shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of the same series duly issued hereunder. All Securities shall be held and owned upon the express condition that the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities, and shall preclude (to the extent lawful) any and all other rights or remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender.
 
Section 2.08            Cancellation .
 
All Securities surrendered for the purpose of payment, redemption, exchange or registration of transfer, if surrendered to the Company or any paying agent, shall be delivered to the Trustee for cancellation, or, if surrendered to the Trustee, shall be cancelled by it, and no Securities shall be issued in lieu thereof except as expressly required or permitted by any of the provisions of this Indenture. On written request of the Company at the time of such surrender, the Trustee shall deliver to the Company canceled Securities held by the Trustee. If the Company shall otherwise acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are delivered to the Trustee for cancellation.
 
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Section 2.09           Benefits of Indenture .
 
Nothing in this Indenture or in the Securities, express or implied, shall give or be construed to give to any Person, other than the parties hereto and the holders of the Securities, any legal or equitable right, remedy or claim under or in respect of this Indenture, or under any covenant, condition or provision herein contained; all such covenants, conditions and provisions being for the sole benefit of the parties hereto and of the holders of the Securities.
 
Section 2.10           Authenticating Agent .
 
So long as any of the Securities of any series remain Outstanding, there may be an Authenticating Agent for any or all such series of Securities which the Trustee shall have the right to appoint. The Authenticating Agent shall be authorized to act on behalf of the Trustee to authenticate Securities of such series, including Securities issued upon exchange, registration of transfer or partial redemption thereof, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. All references in this Indenture to the authentication of Securities by the Trustee shall be deemed to include authentication by an Authenticating Agent for such series. Each Authenticating Agent shall be acceptable to the Company and shall be a corporation that has a combined capital and surplus, as most recently reported or determined by it, sufficient under the laws of any jurisdiction under which it is organized or in which it is doing business to conduct a trust business, and that is otherwise authorized under such laws to conduct such business and is subject to supervision or examination by Federal or State authorities. If at any time any Authenticating Agent shall cease to be eligible in accordance with these provisions, it shall resign immediately. Any Authenticating Agent may resign at any time by giving written notice of resignation to the Trustee and to the Company. The Trustee at any time may, and upon request by the Company shall, terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company. Upon resignation, termination or cessation of eligibility of any Authenticating Agent, the Trustee may appoint an eligible successor Authenticating Agent acceptable to the Company. Any successor Authenticating Agent, upon acceptance of its appointment hereunder, shall become vested with all the rights, powers and duties of its predecessor hereunder as if originally named as an Authenticating Agent pursuant hereto.
 
Section 2.11           Global Securities .
 
(a)            General . If the Company shall establish pursuant to Section 2.01 that the Securities of a particular series are to be issued as a Global Security, then the Company shall execute one or more Global Securities that (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, all of the Outstanding Securities of such series, (ii) shall be registered in the name of the Depositary or its nominee and (iii) shall be delivered to the Trustee as custodian for the Depositary or otherwise delivered pursuant to the Depositary’s instructions, and Parent shall execute the Guarantee or Guarantees thereon, and the Trustee in accordance with Section 2.04 shall authenticate such Global Security or Global Securities.
 
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(b)            Euroclear and Clearstream Procedures Applicable . The provisions of the “Operating Procedures of the Euroclear System” and the “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions” and “Customer Handbook” of Clearstream, respectively, in effect at the relevant time shall be applicable to transfers of beneficial interests in the Regulation S Global Securities of such series that are held by Participants through Euroclear or Clearstream.
 
Section 2.12           CUSIP Numbers .
 
The Company in issuing the Securities of a series may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Securityholders; 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.
 
Section 2.13           Securities Denominated in Foreign Currencies .
 
Except as otherwise specified pursuant to Section 2.01 for Securities of any series, payment of the principal of, premium, if any, and interest on, Securities of such series denominated in any Foreign Currency will be made in such Foreign Currency.
 
In the event any Foreign Currency or Currencies in which any payment with respect to any series of Securities may be made ceases to be a freely convertible Currency on United States Currency markets, for any date thereafter on which payment of principal of, premium, if any, or interest on the Securities of a series is due, the Company shall select the Currency of payment for use on such date, all as provided in the Securities of such series, in a Board Resolution or in one or more indentures supplemental hereto. In such event, the Company shall notify the Trustee of the Currency which it has selected to constitute the funds necessary to meet the Company’s obligations on such payment date and of the amount of such Currency to be paid. Such amount shall be determined as provided in the Securities of such series, in a Board Resolution or in one or more indentures supplemental hereto. The payment with respect to such payment date shall be deposited with the Trustee by the Company solely in the Currency so selected.
 
Section 2.14           Wire Transfers .
 
Notwithstanding any other provision to the contrary in this Indenture, the Company may make any payment required to be deposited with the Trustee on account of principal of, premium, if any, or interest on, the Securities by any method of wire transfer to an account designated in writing by the Trustee such that funds are available on or before the date such payment is to be made to the Holders of the Securities in accordance with the terms hereof.
 
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Section 2.15           Designated Currency .
 
The Company may provide pursuant to Section 2.01 for Securities of any series that:
 
(a) the obligation, if any, of the Company to pay the principal of, premium, if any, and interest on the Securities of any series in a Foreign Currency or Dollars (the “ Designated Currency ”) as may be specified pursuant to Section 2.01(a)(12) is of the essence and agree that, to the fullest extent possible under applicable law, judgments in respect of Securities of such series shall be given in the Designated Currency;
 
(b) the obligation of the Company to make payments in the Designated Currency of the principal of, premium, if any, and interest on such Securities shall be discharged, notwithstanding any payment in any other Currency (whether pursuant to a judgment or otherwise), only to the extent of the amount in the Designated Currency that the Securityholder receiving such payment, in accordance with normal banking procedures, may purchase with the amount paid in such other Currency after any premium and cost of exchange on the business day in the country of issue of the Designated Currency or in the international banking community immediately following the day on which such Securityholder receives such payment;
 
(c) if the amount in the Designated Currency that may be so purchased for any reason falls short of the amount originally due, the Company shall pay such additional amounts as may be necessary to compensate for such shortfall; and
 
(d) any obligation of the Company not discharged by such payment shall be due as a separate and independent obligation and, until discharged as provided herein, shall continue in full force and effect.
 
Section 2.16           Form of Guarantee .
 
The form of Guarantee shall be set forth on the applicable series of Securities substantially as follows:
 
GUARANTEE
 
For value received, Parent hereby absolutely, unconditionally and irrevocably guarantees to the holder of this Security the payment of principal of, premium, if any, and interest on, the Security upon which this Guarantee is set forth in the amounts and at the time when due and payable whether by declaration thereof, or otherwise, and interest on the overdue principal and interest, if any, of such Security, if lawful, to the holder of such Security and the Trustee on behalf of the Holders, all in accordance with and subject to the terms and limitations of such Security and Article XV of the Indenture. This Guarantee will not become effective until the Trustee or Authenticating Agent duly executes the certificate of authentication on this Security. This Guarantee shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of law principles thereof.
 
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Dated:

 	TYCO ELECTRONICS LTD.	

 	By:	 	 	
 	 	Name:	
 	 	Title:	
 
ARTICLE III.
 
REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS
 
Section 3.01           Redemption .
 
The Company may redeem the Securities of any series issued hereunder on and after the dates and in accordance with the terms established for such series pursuant to Section 2.01 or 14.01.
 
Section 3.02           Notice of Redemption .
 
(a)            If the Company desires to exercise such right to redeem all or, as the case may be, a portion of the Securities of any series, the Company shall, or shall instruct the Trustee in writing to, give notice of such redemption to holders of the Securities of such series to be redeemed by mailing, first class postage prepaid, a notice of such redemption not less than 30 days and not more than 90 days before the date fixed for redemption of that series to such holders at their last addresses as they shall appear upon the Security Register (unless a shorter period is specified in the Securities to be redeemed). Any notice that is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the registered holder receives the notice. In any case, failure duly to give such notice to the holder of any Security of any series designated for redemption in whole or in part, or any defect in the notice, shall not affect the validity of the proceedings for the redemption of any other Securities of such series or any other series. 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 with an Officer’s Certificate evidencing compliance with any such restriction.
 
Each such notice of redemption shall specify the date fixed for redemption and the redemption price at which Securities of that series are to be redeemed, and shall state that:  (i) payment of the redemption price of such Securities to be redeemed will be made at the office or agency of the Company maintained for such purpose, or, if none, at the Corporate Trust Office of the Trustee, upon presentation and surrender of such Securities; (ii) interest accrued to the date fixed for redemption will be paid as specified in said notice; (iii) from and after said date interest will cease to accrue; and (iv) the redemption is for a sinking fund, if such is the case. If less than all the Securities of a series are to be redeemed, the notice to the holders of Securities of that series to be redeemed in whole or in part shall specify the particular Securities to be so redeemed. In case any Security is to be redeemed in part only, the notice that relates to such Security shall state the portion of the principal amount thereof to be redeemed, and shall state
 
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that on and after the redemption date, upon surrender of such Security, a new Security or Securities of such series in principal amount equal to the unredeemed portion thereof will be issued.
 
(b)            If all or less than all the Securities of a series are to be redeemed, the Company shall give the Trustee at least 45 days’ written notice (unless a shorter period shall be satisfactory to the Trustee) in advance of the date fixed for redemption as to the aggregate principal amount of Securities of the series to be redeemed. If less than all the Securities are to be redeemed, the Trustee thereupon shall select from Securities of such series Outstanding not previously called for redemption, in accordance with a method determined by the Company (in such manner as complies with applicable legal and stock exchange requirements, if any) and that may provide for the selection of a portion or portions (equal to $1,000 or any integral multiple thereof) of the principal amount of such Securities of such series of a denomination larger than $1,000, the Securities of such series to be redeemed. The Trustee promptly shall notify the Company in writing of the numbers of the Securities of such series to be redeemed, in whole or in part.
 
The Company, if and whenever it shall so elect, by delivery of instructions signed on its behalf by any of its Officers, may instruct the Trustee or any paying agent to call all or any part of the Securities of a particular series for redemption and to give notice of redemption in the manner set forth in this Section 3.02, such notice to be in the name of the Company or its own name, as the Trustee or such paying agent may deem advisable. In any case in which notice of redemption is to be given by the Trustee or any such paying agent, the Company shall deliver or cause to be delivered to, or permit to remain with, the Trustee or such paying agent, as the case may be, such Security Register, transfer books or other records, or suitable copies or extracts therefrom, sufficient to enable the Trustee or such paying agent to give any notice by mail that may be required under the provisions of this Section 3.02.
 
Section 3.03           Payment Upon Redemption .
 
(a)            If the giving of notice of redemption shall have been completed as above provided, the Securities or portions of Securities of the series to be redeemed specified in such notice shall become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to the date fixed for redemption, in each case as established pursuant to Section 2.01 or 14.01. Interest on such Securities or portions of Securities shall cease to accrue on and after the date fixed for redemption, unless the Company shall default in the payment of such redemption price and accrued interest with respect to any such Security or portion thereof. On presentation and surrender of such Securities on or after the date fixed for redemption at the place of payment specified in the notice, such Securities shall be paid and redeemed at the applicable redemption price for such series, together with interest accrued thereon to the date fixed for redemption (but if the date fixed for redemption is an Interest Payment Date, the interest installment payable on such date shall be payable to the registered holder at the close of business on the applicable record date pursuant to Section 2.01).
 
(b)            Upon presentation of any Security of such series that is to be redeemed in part only, the Company shall execute a new Security of the same series and tenor of authorized denominations in principal amount equal to the unredeemed portion of the Security so presented, and Parent shall execute the form of Guarantee thereon, and the Trustee shall authenticate, and
 
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the office or agency where the Security is presented shall deliver to the holder thereof, at the expense of the Company, such Security; except that if a Global Security is so surrendered, the Company shall execute a new Global Security of like tenor in a denomination equal to and in exchange for the unredeemed portion of the principal of the Global Security so surrendered, and Parent shall execute the form of Guarantee thereon, and, upon receipt of an Officer’s Certificate requesting authentication and delivery, the Trustee shall authenticate and deliver to the Depositary for such Global Security, without service charge, such Global Security.
 
Section 3.04            Sinking Fund .
 
The provisions of Sections 3.04, 3.05 and 3.06 shall be applicable to any sinking fund for the retirement of Securities of a series, except as otherwise specified as contemplated by Section 2.01 for Securities of such series.
 
The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is 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 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 3.05. 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 3.05            Satisfaction of Sinking Fund Payments with Securities .
 
The Company (i) may deliver Outstanding Securities of a series (other than any Securities previously called for redemption) and (ii) may apply as a credit Securities of a series that have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities, provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.
 
Section 3.06            Redemption of Securities for Sinking Fund .
 
Not less than 30 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officer’s Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of the series, the portion thereof, if any, that is to be satisfied by payment of cash in the Currency in which the Securities of such series are denominated (except as provided pursuant to Section 2.01), the portion thereof, if any, that is to be satisfied by delivering and crediting Securities of that series pursuant to Section 3.05 and the basis for such credit. Together with such Officer’s Certificate, the Company will deliver to the Trustee any Securities to be so delivered. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 3.02 and
 
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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 3.02. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Section 3.03.
 
ARTICLE IV.
 
CERTAIN COVENANTS
 
The following covenants shall apply to the Securities, except with respect to any series of Securities for which the supplemental indenture or resolution of the Board of Directors under which such series of Securities is issued or in the form of Security for such series expressly provides that any such covenant shall not apply to such series of Securities:
 
Section 4.01           Payment of Principal, Premium and Interest .
 
The Company will duly and punctually pay or cause to be paid the principal of, premium, if any, and interest on the Securities of a series at the time and place and in the manner provided herein and established with respect to such Securities.
 
Section 4.02           Maintenance of Office or Agency .
 
So long as any series of the Securities remain Outstanding, the Company will maintain for such series an office or agency where Securities of such series may be presented or surrendered for payment, where Securities of such 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 such series and this Indenture may be given or served. Such designation will continue with respect to each office or agency until the Company, by written notice signed by any Officer and delivered to the Trustee, shall designate some other office or agency for such purposes or any of them. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all presentations, surrenders, notices and demands. Unless otherwise specified in accordance with Section 2.01 with respect to a series of Securities, the Company initially designates the Corporate Trust Office of Deutsche Bank Trust Company Americas, 60 Wall Street, 27th Floor, New York, New York 10005, acting as the Company’s agent, as the office to be maintained by it for each such purpose.
 
Section 4.03           Paying Agents .
 
(a)            The Company may appoint one or more paying agents, other than the Trustee, for all or any series of the Securities. If the Company fails to appoint or maintain another entity as paying agent, the Trustee shall act as such. Parent, the Company or any of their Subsidiaries may act as paying agent.
 
(b)            The Company shall require each paying agent other than the Trustee to agree in writing that the paying agent will hold in trust for the benefit of Securityholders or the Trustee all funds held by the paying agent for the payment of principal, premium, if any, or interest on the
 
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Securities, and will promptly notify the Trustee in writing of any default by the Company in making any such payment. While any such default continues, the Trustee may require a paying agent to pay all funds held by it to the Trustee. The Company at any time may require a paying agent to pay all funds held by it to the Trustee. Upon payment over to the Trustee, the paying agent (if other than Parent, the Company or any of their Subsidiaries) shall have no further liability for the funds. If Parent, the Company or any of their Subsidiaries acts as paying agent, it shall segregate and hold in a separate trust fund for the benefit of the Securityholders all funds held by it as paying agent.
 
(c)            Notwithstanding anything in this Section to the contrary, (i) the agreement to hold funds in trust as provided in this Section 4.03 is subject to the provisions of Section 11.06, and (ii) the Company at any time, for the purpose of obtaining the satisfaction and discharge or defeasance of this Indenture or for any other purpose, may pay, or direct any paying agent to pay, to the Trustee all funds held in trust by the Company or such paying agent, such funds to be held by the Trustee upon the same terms and conditions as those upon which such funds were held by the Company or such paying agent. Upon such payment by any paying agent to the Trustee, such paying agent shall be released from all further liability with respect to such funds.
 
Section 4.04           Statement by Officers as to Default .
 
So long as any of the Securities remain outstanding, the Company and Parent will furnish to the Trustee on or before March 31 in each year a brief certificate (which need not comply with Section 13.06) executed by the principal executive, financial or accounting officer of each of the Company and Parent on their respective behalf as to his or her knowledge of the Company’s or Parent’s, as the case may be, compliance with all covenants and agreements under this Indenture required to be complied with by the Company and Parent, respectively (such compliance to be determined without regard to any period of grace or requirement of notice provided under this Indenture). Such certificate need not include a reference to any non-compliance that has been fully cured prior to the date as of which such certificate speaks.
 
The Company shall provide written notice to the Trustee within 30 days of the occurrence of any Event of Default under Section 6.01.
 
Section 4.05           Appointment to Fill Vacancy in Office of Trustee .
 
The Company, whenever necessary to avoid or to fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so that there shall be at all times a Trustee hereunder.
 
ARTICLE V.
 
SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND
THE TRUSTEE
 
Section 5.01           Company to Furnish Trustee Names and Addresses of Securityholders .
 
The Company will furnish or cause to be furnished to the Trustee (a) semi-annually at least seven Business Days before each Interest Payment Date for a series of Securities (and in all
 
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events at intervals of not more than six months) a list, in such form as the Trustee may reasonably require, of the names and addresses of the holders of each series of Securities as of such date, provided that the Company shall not be obligated to furnish or cause to furnish such list at any time that the list shall not differ in any respect from the most recent list furnished to the Trustee by the Company and (b) at such other times as the Trustee may require in writing within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; provided, however, that, in either case, no such list need be furnished for any series for which the Trustee shall be the Security Registrar.
 
Section 5.02           Preservation of Information; Communications with Securityholders .
 
(a)            The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the holders of Securities contained in the most recent list furnished to it as provided in Section 5.01 and as to the names and addresses of holders of Securities received by the Trustee in its capacity as Security Registrar (if acting in such capacity).
 
(b)            Securityholders may communicate as provided in Section 312(b) of the Trust Indenture Act with other Securityholders with respect to their rights under this Indenture or under the Securities.
 
Section 5.03           Reports by the Company .
 
(a)            So long as any Securities are outstanding, the Company shall file with the Trustee, within 15 days after Parent files 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) that Parent may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act. The Company shall be deemed to have complied with the previous sentence to the extent that such information, documents and reports are filed with the Commission via EDGAR (or any successor electronic delivery procedure) or posted on Parent’s website.
 
(b)            Delivery of such reports, information and documents to the Trustee is for informational purposes only and the 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 the Trustee is entitled to rely exclusively on Officer’s Certificates).
 
Section 5.04           Reports by the Trustee .
 
(a)            Any Trustee’s report required under Section 313(a) of the Trust Indenture Act shall be transmitted on or before July 15 in each year following the date hereof, so long as any Securities are outstanding hereunder, and shall be dated as of a date convenient to the Trustee no more than 60 nor less than 45 days prior thereto.
 
(b)            A copy of each such report shall, at the time of such transmission to Securityholders, be filed by the Trustee with the Company, with any stock exchange upon which
 
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any Securities are listed and with the Commission. The Company agrees to notify the Trustee when any Securities become listed on any stock exchange or delisted therefrom.
 
ARTICLE VI.
 
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON
EVENT OF DEFAULT
 
Section 6.01           Events of Default .
 
(a)            Whenever used herein with respect to Securities of a particular series, “ Event of Default ” means any one or more of the following events that has occurred and is continuing, except with respect to any series of Securities for which the supplemental indenture or resolution of the Board of Directors under which such series of Securities is issued or in the form of Security for such series expressly provides that any such Event of Default shall not apply to such series of Securities:
 
(1)            default in the payment of any installment of interest upon any of the Securities of such series as and when the same shall become due and payable, and continuance of such default for a period of 30 days; or
 
(2)            default in the payment of all or any part of the principal of or premium, if any, on any of the Securities of such series as and when the same shall become due and payable either at maturity, upon redemption, by declaration or otherwise; or
 
(3)            default in the payment of any sinking fund installment as and when the same shall become due and payable by the terms of the Securities of such series; or
 
(4)            default in the performance, or breach, of any covenant or agreement of Parent or the Company in respect of the Securities of such series and the related Guarantee (other than (x) the failure to comply with any covenant or agreement contained in Section 314(a)(1) of the Trust Indenture Act or Section 5.03(a) or (y) a default or breach that is specifically dealt with elsewhere in this Section 6.01), and continuance of such default or breach for a period of 90 days after the date on which there has been given, by registered or certified mail, to Parent and the Company by the Trustee or to Parent, the Company and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of such 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 Guarantee with respect to the Securities of such series shall for any reason cease to be, or shall for any reason be asserted in writing by Parent or the Company not to be, in full force and effect and enforceable in accordance with its terms except to the extent contemplated by this Indenture and such Guarantee; or
 
(6)            a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Company or Parent in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a
 
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receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Company or Parent or for any substantial part of its property or ordering the winding up or liquidation of its affairs, and such decree or order shall remain unstayed and in effect for a period of 90 consecutive days; or
 
(7)            the Company or Parent shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary case under any such law, or consent to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Company or Parent or for any substantial part of its property, or make any general assignment for the benefit of creditors; or
 
(8)            any other Event of Default provided in the supplemental indenture or resolution of the Board of Directors under which such series of Securities is issued or in the form of Security for such series.
 
Any failure to perform, or breach of, any covenant or agreement of Parent or the Company in respect of the Securities of such series and contained in Section 314(a)(1) of the Trust Indenture Act or Section 5.03(a) shall not be a default or an Event of Default. Remedies against Parent and the Company for any such failure or breach will be limited to liquidated damages as described in the following sentence, and Holders shall not have any right to accelerate the maturity of the Securities of such series as a result of any such failure or breach. Instead, if there is such a failure or breach of Parent’s or the Company’s obligation under Section 314(a)(1) of the Trust Indenture Act or Section 5.03(a) and continuance of such failure or breach for a period of 90 days after the date on which there has been given, by registered or certified mail, to Parent and the Company by the Trustee or to Parent, the Company and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of such series , a written notice specifying such failure or breach and requiring it to be remedied and stating that such notice is a “Notice of Reporting Noncompliance” hereunder, the Company will pay liquidated damages to all Holders of Securities of such series, at a rate per year equal to 0.25% of the principal amount of such Securities from the 90 th day following such notice to and including the 150 th day following such notice and at a rate per year equal to 0.5% of the principal amount of such Securities from and including the 151 st day following such notice, until such failure or breach is cured. Any such liquidated damages shall be payable in the same manner and on the same dates as the stated interest payable on the Securities of such series. In the event that the Company is required to pay such liquidated damages, the Company shall provide a written notice to the Trustee (and if the Trustee is not the paying agent, the paying agent) no later then five Business Days prior to the payment date for the payment of such liquidated damages setting forth the amount of such liquidated damages to be paid by the Company on such payment date and directing the Trustee (or, if the Trustee is not the paying agent, the paying agent) to make such payment to the extent it receives funds from the Company to do so. The Trustee shall not at any time be under any duty or responsibility to any holder of Securities to determine whether such liquidated damages are payable, or with respect to the nature, extent or calculation of the amount of liquidated damages owed.
 
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(b)            In each and every such case, unless the principal of all the Securities of that series shall have already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities of that series then Outstanding hereunder, by notice in writing to Parent and the Company (and to the Trustee if given by such Securityholders), may declare the unpaid principal of all the Securities of that series to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, notwithstanding anything contained in this Indenture or in the Securities of that series or established with respect to that series pursuant to Section 2.01 to the contrary.
 
(c)            At any time after the principal of the Securities of that series shall have been so declared due and payable, and before any judgment or decree for the payment of the amount due shall have been obtained or entered as hereinafter provided, the holders of a majority in aggregate principal amount of the Securities of that series then Outstanding hereunder, by written notice to Parent and the Company and the Trustee, may rescind and annul such declaration and its consequences if: (i) the Company has or has caused to be paid or deposited with the Trustee an amount sufficient to pay all matured installments of interest upon all the Securities of that series and the principal of and premium, if any, on any and all Securities of that series that shall have become due otherwise than by acceleration (with interest upon such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, upon overdue installments of interest, at the rate expressed in the Securities of that series to the date of such payment or deposit), and (ii) any and all Events of Default under this Indenture with respect to such series, other than the nonpayment of principal on Securities of that series that shall not have become due by their terms, shall have been remedied or waived as provided in Section 6.06.
 
No such rescission and annulment shall extend to or shall affect any subsequent default or impair any right consequent thereon.
 
(d)            In case the Trustee shall have proceeded to enforce any right with respect to Securities of that series under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, then and in every such case the Company and the Trustee shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Company and the Trustee shall continue as though no such proceedings had been taken.
 
(e)            The Trustee shall give to the Securityholders of any series, as the names and addresses of such Holders appear on the Security Register, notice by mail of all defaults known to the Trustee that have occurred with respect to such series, such notice to be transmitted within 90 days after the occurrence thereof, unless such defaults shall have been cured before the giving of such notice (the term “default” or “defaults” for the purposes of this Section 6.01(e) being hereby defined to mean any event or condition which is, or with notice or lapse of time or both would become, an Event of Default); provided that, except in the case of default in the payment of the principal of, premium, if any, or interest on any of the Securities of such series, or in the payment of any sinking or purchase fund installment with respect to the Securities of such series, the 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 or trustees and/or Responsible Officers
 
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in good faith determines that the withholding of such notice is in the interests of the Securityholders of such series.
 
Section 6.02                              Collection of Indebtedness and Suits for Enforcement by Trustee .
 
(a)            The Company covenants that (i) in case it shall default in the payment of any installment of interest on any of the Securities of a series, or any payment required by any sinking or analogous fund established with respect to that series as and when the same shall have become due and payable, and such default shall have continued for a period of 30 days, or (ii) in case it shall default in the payment of the principal of, or premium, if any, on any of the Securities of a series when the same shall have become due and payable, whether upon maturity of the Securities of a series or upon redemption or upon declaration or otherwise, then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Securities of that series, the whole amount that then shall have been become due and payable on all such Securities for principal, premium, if any, or interest, or both, with interest upon the overdue principal, premium, if any, and (to the extent that payment of such interest is enforceable under applicable law) upon overdue installments of interest at the rate expressed in the Securities of that series; and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, and the amount payable to the Trustee under Section 7.06.
 
(b)            If the Company shall fail to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the amounts so due and unpaid, and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or Parent and collect the amounts adjudged or decreed to be payable in the manner provided by law out of the property of the Company or Parent, wherever situated.
 
(c)            In case of any receivership, insolvency, liquidation, bankruptcy, reorganization, readjustment, arrangement, composition or judicial proceedings affecting the Company or Parent or its respective creditors or property, the Trustee shall have power to intervene in such proceedings and take any action therein that may be permitted by the court and, except as otherwise provided by law, shall be entitled to file such proofs of claim and other papers and documents as may be necessary or advisable in order to have the claims of the Trustee and of the holders of Securities of such series allowed for the entire amount due and payable by the Company under this Indenture at the date of institution of such proceedings and for any additional amount that may become due and payable by the Company after such date, and to collect and receive any funds or other property payable or deliverable on any such claim, and to distribute the same in accordance with Section 6.03. Any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized by each of the holders of Securities of such series to make such payments to the Trustee, and, in the event that the Trustee shall consent to the making of such payments directly to such Securityholders, to pay to the Trustee any amount due it under Section 7.06.
 
(d)            All rights of action and of asserting claims under this Indenture, or under any of the terms established with respect to Securities of that series, may be enforced by the Trustee
 
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without the possession of any of such Securities, or the production thereof at any trial or other proceeding relative thereto. Any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for payment to the Trustee of any amounts due under Section 7.06, be for the ratable benefit of the holders of the Securities of such series.
 
In case of an Event of Default, the Trustee in its discretion may proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law.
 
Nothing contained herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities of that series or the rights of any holder thereof or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding.
 
Section 6.03                                 Application of Funds Collected .
 
Any funds collected by the Trustee pursuant to this Article VI with respect to a particular series of Securities shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such funds on account of principal, premium, if any, or interest, upon presentation of the Securities of that series, and notation thereon the payment, if only partially paid, and upon surrender thereof if fully paid:
 
FIRST: To the payment of costs and expenses of collection and of all amounts payable to the Trustee under Section 7.06;
 
SECOND: To the payment of the amounts then due and unpaid upon Securities of such series for principal, premium, if any, and interest, in respect of which or for the benefit of which such funds have been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal, premium, if any, and interest, respectively; and
 
THIRD: To the Company.
 
Section 6.04                                 Limitation on Suits .
 
No holder of any Security of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless (i) such holder previously shall have given to the Trustee written notice of an Event of Default and of the continuance thereof with respect to the Securities of such series specifying such Event of Default; (ii) the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding shall have made written
 
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request upon the Trustee to institute such action, suit or proceeding in its own name as trustee hereunder; (iii) such holder or holders shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby; (iv) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity, shall have failed to institute any such action, suit or proceeding; and (v) during such 60 day period, the holders of a majority in principal amount of the Securities of that series do not give the Trustee a direction inconsistent with the request.
 
Notwithstanding anything contained herein to the contrary, any other provisions of this Indenture, the right of any holder of any Security to receive payment of the principal of, and premium, if any, and interest on such Security, as therein provided, on or after the respective due dates expressed in such Security (or in the case of redemption, on the redemption date), or to institute suit for the enforcement of any such payment on or after such respective dates or redemption date, shall not be impaired or affected without the consent of such holder. By accepting a Security hereunder it is expressly understood, intended and covenanted by the taker and holder of every Security of such series with every other such taker and holder and the Trustee, that no one or more holders of Securities of such series shall have any right in any manner whatsoever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of the holders of any other of such Securities, or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all holders of Securities of such series. For the protection and enforcement of the provisions of this Section 6.04, each Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity.
 
Section 6.05                              Rights and Remedies Cumulative; Delay or Omission not Waiver .
 
(a)            Except as otherwise provided in Section 2.07, all powers and remedies given by this Article VI to the Trustee or to the Securityholders, to the extent permitted by law, shall be deemed cumulative and not exclusive of any other powers and remedies available to the Trustee or the holders of the Securities, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture or otherwise established with respect to such Securities.
 
(b)            No delay or omission of the Trustee or of any holder of any of the Securities to exercise any right or power accruing upon any Event of Default occurring and continuing shall impair any such right or power, or shall be construed to be a waiver of any such default or on acquiescence therein. Subject to the provisions of Section 6.04, every power and remedy given by this Article VI or by law to the Trustee or the Securityholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders.
 
Section 6.06                              Control by Securityholders .
 
The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding, determined in accordance with Section 8.04, shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to such series; provided,
 
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however, that such direction shall not be in conflict with any rule of law or with this Indenture or be unduly prejudicial to the rights of holders of Securities of any other series at the time Outstanding determined in accordance with Section 8.04. Subject to the provisions of Section 7.01, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith, by a Responsible Officer or Responsible Officers of the Trustee, shall determine that the proceeding so directed would involve the Trustee in personal liability. The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding affected thereby, determined in accordance with Section 8.04, on behalf of the holders of all of the Securities of such series may waive any past default in the performance of any of the covenants contained herein or established pursuant to Section 2.01 with respect to such series and its consequences, except a default in the payment of the principal of, premium, if any, or interest on, any of the Securities of that series as and when the same shall become due by the terms of such Securities otherwise than by acceleration (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal and any premium has been deposited with the Trustee in accordance with Section 6.01(c). Upon any such waiver, the default covered thereby shall be deemed to be cured for all purposes of this Indenture and the Company, the Trustee and the holders of the Securities of such series shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.
 
Section 6.07                                 Undertaking to Pay Costs .
 
All parties to this Indenture agree, and each holder of any Securities by such holder’s 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 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 6.07 shall not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder, or group of Securityholders, holding more than 10% in aggregate principal amount of the Outstanding Securities of any series, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of, premium, if any, or interest on any Security of such series, on or after the respective due dates expressed in such Security or established pursuant to this Indenture.
 
Section 6.08                                 Waiver Of Usury, Stay Or Extension Laws .
 
Each of Parent and the Company 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 usury, 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 Parent and the Company (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, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.
 
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ARTICLE VII.
 
CONCERNING THE TRUSTEE
 
Section 7.01                              Certain Duties and Responsibilities of Trustee .
 
(a)            In case an Event of Default with respect to the Securities of a series has occurred (that has not been cured or waived), the Trustee shall exercise with respect to Securities of that series 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.
 
(b)            No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
 
(1)            prior to the occurrence of an Event of Default with respect to the Securities of a series and after the curing or waiving of all such Events of Default with respect to that series that may have occurred:
 
(i)             the duties and obligations of the Trustee shall with respect to the Securities of such series be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable with respect to the Securities of such series except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
 
(ii)            in the absence of bad faith on the part of the Trustee, the Trustee with respect to the Securities of such series may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Trustee, the 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 computations or other facts stated therein);
 
(2)            the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts;
 
(3)            the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of not less than a majority in principal amount of the Securities of any series at the time Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture with respect to the Securities of that series; and
 
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(4)            none of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there is reasonable ground for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Indenture or adequate indemnity against such risk is not reasonably assured to it.
 
Section 7.02                              Certain Rights of Trustee .
 
Except as otherwise provided in Section 7.01:
 
(a)            The Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security or other paper or document (whether in its original or facsimile form) believed by it to be genuine and to have been signed or presented by the proper party or parties.
 
(b)            Any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by a Board Resolution or an instrument signed in the name of the Company by an Officer (unless other evidence in respect thereof is specifically prescribed herein).
 
(c)            The Trustee may consult with counsel of its own 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 or suffered or omitted hereunder in good faith and in reliance thereon.
 
(d)            The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Securityholders, pursuant to the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred therein or thereby.
 
(e)            The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture.
 
(f)             The 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, consent, order, approval, bond, security or other papers or documents, but the Trustee, in its discretion, may make such further inquiry into such matters as it may see fit, and if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
 
(g)            The Trustee shall not be deemed to have notice of any Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any
 
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event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee.
 
(h)            The 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 the 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.
 
(i)             The rights, privileges, protections, immunities and benefits given to the Trustee, including 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.
 
(j)             The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.
 
Section 7.03                              Trustee not Responsible for Recitals or Issuance of Securities .
 
(a)            The recitals contained herein and in the Securities shall be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of the same.
 
(b)            The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.
 
(c)            The Trustee shall not be accountable for the use or application by the Company of any of the Securities or of the proceeds of such Securities, or for the use or application of any funds paid over by the Trustee in accordance with any provision of this Indenture or established pursuant to Section 2.01, or for the use or application of any funds received by any paying agent other than the Trustee.
 
Section 7.04                              May Hold Securities .
 
The Trustee or any paying agent or Security Registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, paying agent or Security Registrar. However, the Trustee is subject to Sections 7.09 and 7.13.
 
Section 7.05                              Funds Held in Trust .
 
Subject to the provisions of Section 11.06, all funds received by the Trustee, until used or applied as herein provided, shall be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any funds received by it hereunder except such as it may agree with the Company to pay thereon.
 
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Section 7.06                              Compensation and Reimbursement .
 
(a)            The Company shall pay to the Trustee, and the Trustee shall be entitled to be paid, such compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust), as the Company and the Trustee from time to time may agree in writing, for all services rendered by it in the execution of the trusts hereby created and in the exercise and performance of any of the powers and duties hereunder of the Trustee. Except as otherwise expressly provided herein, the Company will pay or reimburse the Trustee upon its request for all reasonable expenses and disbursements incurred or made by the Trustee in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all Persons not regularly in its employ) except any such expense or disbursement as may arise from its own negligence or bad faith. The Company and Parent shall indemnify the Trustee (and its officers, agents, directors and employees) for, and shall hold it harmless against, any and all loss, liability, claim, damage or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee) incurred without negligence or bad faith on the part of the Trustee and arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending itself against any claim of liability (whether asserted by the Company, any Holder or any other Person).
 
(b)            The obligations of the Company under this Section 7.06 to compensate and indemnify the Trustee and to pay or reimburse the Trustee for expenses and disbursements shall: (i) be secured by a lien prior to that of the Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the holders of particular Securities; and (ii) survive the termination of this Indenture and resignation or removal of the Trustee.
 
Section 7.07                              Reliance on Officer’s Certificate .
 
Except as otherwise provided in Section 7.01, whenever in the administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting to take any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed), in the absence of negligence or bad faith on the part of the Trustee, may be deemed to be conclusively proved and established by an Officer’s Certificate delivered to the Trustee and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted to be taken by it under the provisions of this Indenture upon the faith thereof.
 
Section 7.08                              Disqualification; Conflicting Interests .
 
If the Trustee has or shall acquire any “conflicting interest” within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the Company shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act.
 
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Section 7.09                              Corporate Trustee Required; Eligibility .
 
There shall at all times be a Trustee with respect to the Securities issued hereunder which shall at all times be a corporation organized and doing business under the laws of the United States or any State or Territory thereof or of the District of Columbia, or a corporation or other Person permitted to act as trustee by the Commission, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $100,000,000, and subject to supervision or examination by Federal, State, Territorial, or District of Columbia authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section 7.09 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. The Company may not, nor may any Affiliate of the Company, serve as Trustee. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 7.09, the Trustee shall resign immediately in the manner and with the effect specified in Section 7.10.
 
Section 7.10                              Resignation and Removal; Appointment of Successor .
 
(a)            The Trustee or any successor hereafter appointed may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company and by transmitting notice of resignation by mail, first class postage prepaid, to the Securityholders of such series, as their names and addresses appear upon the Security Register. Upon receiving such notice of resignation, the Company promptly shall appoint a successor trustee with respect to Securities of such series. If no successor trustee shall have been so appointed and have accepted appointment within 60 days after the retiring Trustee resigns, the retiring Trustee, at the expense of the Company, or the Company may petition any court of competent jurisdiction for the appointment of a successor trustee with respect to Securities of such series, or any Securityholder of that series who has been a bona fide holder of a Security or Securities for at least six months may on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee.
 
(b)            In case at any time any one of the following shall occur, the Company may remove the Trustee with respect to all or any series of Securities and appoint a successor trustee, or, unless the Trustee’s duty to resign is stayed as provided herein, any Securityholder who has been a bona fide holder of a Security or Securities for at least six months, on behalf of that holder and all others similarly situated, may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may thereupon after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee:
 
(1)            the Trustee shall fail to comply with the provisions of Section 7.08 after written request therefor by the Company or by any Securityholder who has been a bona fide holder of a Security or Securities for at least six months; or
 
(2)            the Trustee shall cease to be eligible in accordance with the provisions of Section 7.09 and shall fail to resign after written request therefor by the Company or by
 
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any such Securityholder; or
 
(3)            the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy proceeding, or a receiver of the Trustee or of its property shall be appointed or consented to, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation.
 
If an instrument of acceptance by a successor Trustee shall not have been delivered to the Trustee 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.
 
(c)            The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding at any time may remove the Trustee with respect to such series by so notifying the Trustee and the Company and may appoint a successor Trustee for such series with the consent of the Company.
 
(d)            Any resignation or removal of the Trustee and appointment of a successor trustee with respect to the Securities of a series pursuant to any of the provisions of this Section shall become effective upon acceptance of appointment by the successor trustee as provided in Section 7.11.
 
(e)            Any successor trustee appointed pursuant to this Section 7.10 may be appointed with respect to the Securities of one or more series or all of such series, and at any time there shall be only one Trustee with respect to the Securities of any particular series.
 
Section 7.11                              Acceptance of Appointment By Successor .
 
(a)            In case of the appointment hereunder of a successor trustee with respect to all Securities, every such successor trustee so appointed shall execute, acknowledge and deliver to the Company and to 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. On the request of the Company or the successor trustee, such retiring Trustee, upon payment of its charges, shall execute and deliver an instrument transferring to such successor trustee all the rights, powers, and trusts of the retiring Trustee and shall assign, transfer and deliver to such successor trustee all property and funds 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 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 (i) 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, (ii) shall contain such provisions as shall be deemed necessary or
 
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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 (iii) 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, 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 and that no Trustee shall be responsible for any act or failure to act on the part of any other Trustee hereunder. 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 such retiring Trustee shall have no further responsibility with respect to the Securities of that or those series to which the appointment of such successor trustee relates for the exercise of rights and powers or for the performance of the duties and obligations vested in the Trustee under this Indenture. 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. On request of the Company or any successor trustee, such retiring Trustee shall assign, transfer and deliver to such successor trustee, to the extent contemplated by such supplemental indenture, the property and funds 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 may 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 Section 7.11(a) or (b), as the case may be.
 
(d)            No successor trustee shall accept its appointment unless at the time of such acceptance such successor trustee shall be qualified and eligible under this Article VII.
 
(e)            Upon acceptance of appointment by a successor trustee as provided in this Section 7.11, the successor trustee shall cause a notice of its succession to be transmitted to Securityholders.
 
Section 7.12                            Merger, Conversion, Consolidation or Succession to Business .
 
Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided that such corporation shall be qualified under the provisions of Section 7.08 and eligible under the provisions of Section 7.09, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.
 
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Section 7.13                              Preferential Collection of Claims Against the Company .
 
The Trustee shall comply with Section 311(a) of the Trust Indenture Act, excluding any creditor relationship described in Section 311(b) of the Trust Indenture Act. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the Trust Indenture Act to the extent included therein.
 
ARTICLE VIII.
 
CONCERNING THE SECURITYHOLDERS
 
Section 8.01                              Evidence of Action by Securityholders .
 
Whenever in this Indenture it is provided that the holders of a majority or specified percentage in aggregate principal amount of the Securities of a particular series may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the holders of such majority or specified percentage of that series have joined therein may be evidenced by any instrument or any number of instruments of similar tenor executed by such holders of Securities of that series in Person or by agent or proxy appointed in writing.
 
If the Company shall solicit from the Securityholders of any series any request, demand, authorization, direction, notice, consent, waiver or other action, the Company, at its option, as evidenced by an Officer’s Certificate, may fix in advance a record date for such series for the determination of Securityholders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other action, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other action may be given before or after the record date, but only the Securityholders of record at the close of business on the record date shall be deemed to be Securityholders for the purposes of determining whether Securityholders of the requisite proportion of Outstanding Securities of that series have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other action, and for that purpose the Outstanding Securities of that series shall be computed as of the record date; provided, however, that no such authorization, agreement or consent by such Securityholders on the record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date.
 
Section 8.02                              Proof of Execution by Securityholders .
 
Subject to the provisions of Section 7.01, proof of the execution of any instrument by a Securityholder (such proof will not require notarization) or his agent or proxy and proof of the holding by any Person of any of the Securities shall be sufficient if made in the following manner:
 
(a)            The fact and date of the execution by any such Person of any instrument may be proved in any reasonable manner acceptable to the Trustee.
 
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(b)            The ownership of Securities shall be proved by the Security Register of such Securities or by a certificate of the Security Registrar thereof.
 
(c)            The Trustee may require such additional proof of any matter referred to in this Section as it shall deem necessary.
 
Section 8.03                              Who May be Deemed Owners .
 
Prior to the due presentment for registration of transfer of any Security, the Company, the Trustee, any paying agent and any Security Registrar may deem and treat the Person in whose name such Security shall be registered upon the books of the Company as the absolute owner of such Security (whether or not such Security shall be overdue and notwithstanding any notice of ownership or writing thereon made by anyone other than the Security Registrar) for the purpose of receiving payment of or on account of the principal of, premium, if any, and (subject to Section 2.03) interest on such Security and for all other purposes; and neither the Company nor the Trustee nor any paying agent nor any Security Registrar shall be affected by any notice to the contrary.
 
None of the Company, the Trustee, 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 in a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.
 
Section 8.04                              Certain Securities Owned by Company Disregarded .
 
In determining whether the holders of the requisite aggregate principal amount of Securities of a particular series have concurred in any direction, consent of waiver under this Indenture, the Securities of that series that are owned by Parent, the Company or any other obligor on the Securities of that series or by an Affiliate of Parent or the Company shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Securities of such series that a Responsible Officer of the Trustee knows are so owned shall be so disregarded. The Securities so owned that have been pledged in good faith may be regarded as Outstanding for the purposes of this Section, if the pledgee shall establish to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not an Affiliate. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. Upon request of the Trustee, the Company shall furnish to the Trustee promptly an Officer’s Certificate listing and identifying all Securities of a particular series, if any known by Parent or the Company to be owned or held by or for the account of any of the above described Persons and, subject to Sections 7.01 and 7.02, the Trustee shall be entitled to accept such Officer’s Certificate as conclusive evidence of the facts therein set forth and of the fact that all Securities of such particular series not listed therein are Outstanding for the purpose of any such determination.
 
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Section 8.05                              Actions Binding on Future Securityholders .
 
At any time prior to the evidencing to the Trustee, as provided in Section 8.01, of the taking of any action by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action, any holder of a Security of that series that is shown by the evidence to be included in the Securities the holders of which have consented to such action, by filing written notice with the Trustee, and upon proof of holding as provided in Section 8.02, may revoke such action so far as concerns such Security. Except as aforesaid any such action taken by the holder of any Security shall be conclusive and binding upon such holder and upon all future holders and owners of such Security, and of any Security issued in exchange therefor, on registration of transfer thereof or in place thereof, irrespective of whether or not any notation in regard thereto is made upon such Security. Any action taken by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action shall be conclusively binding upon the Company, the Trustee and the holders of all the Securities of that series.
 
ARTICLE IX.
 
SUPPLEMENTAL INDENTURES
 
Section 9.01                              Supplemental Indentures Without the Consent of Securityholders .
 
In addition to any supplemental indenture otherwise authorized by this Indenture, Parent, the Company and the Trustee from time to time and at any time may enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect), without the consent of the Securityholders, for one or more of the following purposes:
 
(a)            to cure any ambiguity, defect, or inconsistency herein or in the Securities of any series, including making such changes as are required for this Indenture to comply with the Trust Indenture Act, or to make such other provisions in regard to matters or questions arising under this Indenture or under any supplemental indenture as the Board of Directors of the Company may deem necessary or desirable, and which shall not in either case adversely affect the interests of the Holders of the Securities in any material respect;
 
(b)            to evidence the succession of another Person to Parent or the Company, or successive successions, and the assumption by the successor Person of the covenants, agreements and obligations of Parent or the Company, as the case may be, pursuant to Article X;
 
(c)            to provide for uncertificated Securities in addition to or in place of certificated Securities;
 
(d)            to add to the covenants of the Company for the benefit of the holders of all or any outstanding series of Securities (and if such covenants are to be for the benefit of less than all outstanding 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 Parent or the Company;
 
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(e)            to add any additional Events of Default for the benefit of the holders of all or any outstanding series of Securities (and if such Events of Default are to be applicable to less than all outstanding series, stating that such Events of Default are expressly being included solely to be applicable to such series);
 
(f)             to change or eliminate any of the provisions of this Indenture, provided that any such change or elimination shall not become effective with respect to any outstanding Security of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such provision;
 
(g)            to secure the Securities of any series;
 
(h)            to make any other change that does not adversely affect the rights of any Securityholder of Outstanding Securities in any material respect;
 
(i)             to provide for the issuance of and establish the form and terms and conditions of the Securities of any series as provided in Section 2.01, to provide which, if any, of the covenants of the Company shall apply to such series, to provide which of the Events of Default shall apply to such series,  to provide for the terms and conditions upon which the Guarantee by Parent of such series of Securities may be released or terminated, or to define the rights of the holders of such series of Securities;
 
(j)             to issue additional Securities of any series; provided that such additional Securities have the same terms as, and be deemed part of the same series as, the applicable series of Securities issued hereunder to the extent required by Section 2.01(b); or
 
(k)            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 trust hereunder by more than one Trustee.
 
Upon the request of the Company, accompanied by Board Resolutions authorizing the execution of any such supplemental indenture, and upon receipt by the Trustee of the documents described in Section 9.05, the Trustee shall join with Parent and the Company in the execution of any such supplemental indenture, and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into any such supplemental indenture that affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.
 
Any supplemental indenture authorized by the provisions of this Section 9.01 may be executed by Parent, the Company and the Trustee without the consent of the holders of any of the Securities at the time Outstanding, notwithstanding any of the provisions of Section 9.02.
 
Section 9.02                              Supplemental Indentures with Consent of Securityholders .
 
With the consent (evidenced as provided in Section 8.01) of the holders of not less than a majority in aggregate principal amount of the Securities of each series at the time Outstanding affected by such supplemental indenture or indentures, Parent and the Company, when
 
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authorized by Board Resolutions, and the Trustee from time to time and at any time may enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect) for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner not covered by Section 9.01 the rights of the holders of the Securities of such series under this Indenture; provided, however, that no such supplemental indenture, without the consent of the holders of each Security then Outstanding and affected thereby, shall (i) extend a fixed maturity of or any installment of principal of any Securities of any series or reduce the principal amount thereof or reduce the amount of principal of any original issue discount security that would be due and payable upon declaration of acceleration of the maturity thereof; (ii) reduce the rate of or extend the time for payment of interest on any Security of any series; (iii) reduce the premium payable upon the redemption of any Security; (iv) make any Security payable in Currency other than that stated in the Security; (v) impair the right to institute suit for the enforcement of any payment on or after the fixed maturity thereof (or in the case of redemption, on or after the redemption date); or (vi) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture or indentures.
 
A supplemental indenture that changes or eliminates any covenant, Event of Default or other provision of this Indenture that has been expressly included solely for the benefit of one or more particular series of Securities, if any, or which modifies the rights of the holders of Securities of such series with respect to such covenant, Event of Default 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 the consent of Securityholders of a series affected thereby under this Section 9.02 to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof.
 
Promptly after the execution by Parent, the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section 9.02, the Company shall mail or caused to be mailed a notice thereof by first class mail to the Holders of Securities of each series affected thereby at their addresses as they shall appear on the Security Register, setting forth in general terms the substance of such supplemental indenture. Any failure of the Company to mail such notice, or any defect therein, shall not in any way impair or affect the validity of any such supplemental indenture.
 
Section 9.03                              Effect of Supplemental Indentures .
 
Upon the execution of any supplemental indenture pursuant to the provisions of this Article IX or Section 10.01, this Indenture shall be and be deemed to be modified and amended with respect to such series in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, Parent, the Company and the holders of Securities of the series affected thereby shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes.
 
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Section 9.04                              Securities Affected by Supplemental Indentures .
 
Securities of any series affected by a supplemental indenture and authenticated and delivered after the execution of such supplemental indenture pursuant to the provisions of this Article or of Section 10.01 may bear a notation in form approved by the Company, provided such form meets the requirements of any exchange upon which such series may be listed, as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities of that series so modified as to conform, in the opinion of the Board of Directors of the Company, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the Securities of that series then Outstanding.
 
Section 9.05                              Execution of Supplemental Indentures .
 
Upon the request of the Company, accompanied by Board Resolutions authorizing the execution of any such supplemental indenture, and, if applicable, upon the filing with the Trustee of evidence of the consent of Securityholders required to consent thereto as aforesaid, the Trustee shall join with Parent and the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee in its discretion  may but shall not be obligated to enter into such supplemental indenture. The Trustee, subject to the provisions of Section 7.01, may receive an Opinion of Counsel and Officer’s Certificate as conclusive evidence that any supplemental indenture executed pursuant to this Article IX is authorized or permitted by, and conforms to, the terms of this Article IX.
 
Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section 9.05, the Trustee shall transmit by mail, first class postage prepaid, a notice, setting forth in general terms the substance of such supplemental indenture, to the Securityholders of each series affected thereby as their names and addresses appear upon the Security Register. Any failure of the Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.
 
ARTICLE X.
 
SUCCESSOR
 
Section 10.01                        Consolidation, Merger and Sale of Assets .
 
Each of Parent and the Company, covenants that it will not merge or consolidate with any other Person or sell or convey all or substantially all of its assets to any Person, unless:
 
(i) either Parent or the Company, as the case may be, shall be the continuing entity, or the successor entity or the Person which acquires by sale or conveyance substantially all the assets of Parent or the Company, as the case may be (if other than Parent or the Company, as the case may be), (A) shall expressly assume the due and punctual payment of the principal of, premium, if any, and interest on all the Securities or the obligations under the Guarantees, as the case may be,
 
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according to their tenor, and the due and punctual performance and observance of all of the covenants and agreements of this Indenture to be performed or observed by Parent or the Company, as the case may be, by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by such Person and (B) is an entity treated as a “corporation” for United States tax purposes or Parent or the Company, as the case may be, obtains either (x) an opinion, in form and substance reasonably acceptable to the Trustee, of tax counsel of recognized standing reasonably acceptable to the Trustee, which counsel shall include Gibson, Dunn & Crutcher LLP, or (y) a ruling from the United States Internal Revenue Service, in either case to the effect that such merger or consolidation, or such sale or conveyance, will not result in an exchange of the Securities for new debt instruments for United States federal income tax purposes; and
 
(ii) no Event of Default and no event that, after notice or lapse of time or both, would become an Event of Default shall be continuing immediately after such merger or consolidation, or such sale or conveyance.
 
The Company shall deliver to the Trustee prior to the consummation of the proposed transaction an Officer’s Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture.
 
To the extent that a Board Resolution or supplemental indenture pertaining to any series provides for different provisions relating to the subject matter of this Article X, the provisions in such Board Resolution or supplemental indenture shall govern for purposes of such series.
 
Section 10.02                        Successor Person Substituted .
 
Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of Parent or the Company, as the case may be, the successor Person formed by such consolidation or into or with which Parent or the Company, as the case may be, is merged or to which such sale, lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, Parent or the Company, as the case may be, under this Indenture with the same effect as if such successor Person has been named as Parent or the Company, as the case may be, herein. In the event of any such sale or conveyance (other than a conveyance by way of lease) Parent or the Company, as the case may be, or any successor entity which shall theretofore have become such in the manner described in this Article, shall be discharged from all obligations and covenants under this Indenture, the Securities and the Guarantees and may be liquidated and dissolved.
 
ARTICLE XI.
 
SATISFACTION AND DISCHARGE
 
Section 11.01                        Applicability of Article .
 
If the Securities of a series are denominated and payable only in Dollars (except as provided pursuant to Section 2.01), then the provisions of this Article XI relating to defeasance of Securities shall be applicable except as otherwise specified pursuant to Section 2.01 for
 
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Securities of such series. Defeasance provisions, if any, for Securities denominated in a Foreign Currency may be specified pursuant to Section 2.01.
 
Section 11.02                        Satisfaction and Discharge of Indenture .
 
If at any time:
 
(a) Parent or the Company shall have delivered or shall have caused to be delivered to the Trustee for cancellation all Securities of a series theretofore authenticated (other than any Securities that shall have been destroyed, lost or stolen and that shall have been replaced or paid as provided in Section 2.07) and Securities for whose payment funds or Governmental Obligations have theretofore been deposited in trust or segregated and held in trust by Parent or the Company (and thereupon repaid to Parent or the Company or discharged from such trust, as provided in Section 11.06); or
 
(b) all such Securities of a particular series not theretofore delivered to the Trustee for cancellation shall have become due and payable or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and Parent or the Company shall irrevocably deposit or cause to be deposited with the Trustee as trust funds the entire amount (in funds or Governmental Obligations sufficient or a combination thereof) in Dollars (except as otherwise provided pursuant to Section 2.01) sufficient to pay at maturity or upon redemption all Securities of such series not theretofore delivered to the Trustee for cancellation, including principal, premium, if any, and interest due or to become due on such date of maturity or redemption date, as the case may be, and if in either case Parent or the Company shall also pay or cause to be paid all other sums payable hereunder with respect to such series by the Company,
 
then this Indenture shall cease to be of further effect with respect to such series except for the provisions of Sections 2.03, 2.04, 2.05, 2.07, 4.01, 4.02, 4.03, 7.05 and 7.10, that shall survive until the date of maturity or redemption date, as the case may be, and Sections 7.06 and 11.06, that shall survive to such date and thereafter, and the Trustee, on demand of the Company and at the cost and expense of the Company shall execute proper instruments acknowledging satisfaction of and discharging this Indenture with respect to such series.
 
Section 11.03                        Defeasance and Discharge of Obligations; Covenant Defeasance .
 
(a)            If at any time:
 
(i) all such Securities of a particular series not heretofore delivered to the Trustee for cancellation or that have not become due and payable as described in Section 11.02 shall have been paid by Parent or the Company by depositing irrevocably with the Trustee in trust funds or an amount of Governmental Obligations sufficient to pay at maturity or upon redemption all such Securities of that series not theretofore delivered to the Trustee for cancellation, including principal, premium, if any, and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and
 
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(ii) Parent or the Company shall also pay or cause to be paid all other amounts payable hereunder by the Company with respect to such series,
 
then, after the date such funds or Governmental Obligations, as the case may be, are deposited with the Trustee, the obligations of Parent and the Company under this Indenture with respect to such series shall cease to be of further effect except, to the extent applicable to each, for the provisions of Sections 2.03, 2.04, 2.05, 2.07, 4.01, 4.02, 4.03, 7.05 and 7.10 hereof that shall survive until such Securities shall mature and be paid. Thereafter, Sections 7.06 and 11.06 shall survive such satisfaction and discharge.
 
(b)            In addition, each of Parent and the Company, at its option and at any time, by written notice executed by an Officer delivered to the Trustee, may elect to have its obligations, to the extent applicable to each, under Section 5.03 and any covenant contained in Article X, and any other covenant contained in the Board Resolution or supplemental indenture relating to such series pursuant to Section 2.01, discharged with respect to all Outstanding Securities of a series, this Indenture and any indentures supplemental to this Indenture insofar as such Securities are concerned (“ covenant defeasance ”), such discharge to be effective on the date the conditions set forth in clauses (i) through (vi) of Section 11.03(c) are satisfied, and such Securities shall thereafter be deemed to be not “Outstanding” for the purposes of any direction, waiver, consent or declaration of Securityholders (and the consequences of any thereof) in connection with such covenants, but shall continue to be “Outstanding” for all other purposes under this Indenture. For this purpose, such covenant defeasance means that, with respect to the Outstanding Securities of a series, Parent and the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute an Event of Default under Section 6.01(a)(4) or otherwise, but except as specified in this Section 11.03(b), the remainder of Parent’s and the Company’s obligations under the Securities of such series, this Indenture, and any indentures supplemental to this Indenture with respect to such series shall be unaffected thereby.
 
(c)            The following shall be the conditions to the application of Section 11.03 to the Outstanding Securities of the applicable series:
 
(i)             Parent or the Company irrevocably deposits in trust with the Trustee or, at the option of the Trustee, with a trustee satisfactory to the Trustee and Parent or the Company, as the case may be, under the terms of an irrevocable trust agreement in form and substance satisfactory to the Trustee, funds or Governmental Obligations sufficient to pay principal of, premium, if any, and interest on the Outstanding Securities of such series to maturity or redemption, as the case may be, and to pay all other amounts payable by it hereunder, provided that (A) the trustee of the irrevocable trust shall have been irrevocably instructed to pay such funds or the proceeds of such Governmental Obligations to the Trustee and (B) the Trustee shall have been irrevocably instructed to apply such funds or the proceeds of such Governmental Obligations to the payment of said principal, premium, if any, and interest with respect to the Securities of such series;
 
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(ii)            Parent or the Company, as the case may be, delivers to the Trustee an Officer’s Certificate stating that all conditions precedent specified herein relating to defeasance or covenant defeasance, as the case may be, have been complied with, and an Opinion of Counsel to the same effect;
 
(iii)           no Event of Default under clauses (1), (2), (3), (5), (6) or (7) of Section 6.01(a) shall have occurred and be continuing, and no event which with notice or lapse of time or both would become such an Event of Default shall have occurred and be continuing, on the date of such deposit;
 
(iv)           Parent or the Company, as the case may be, shall have delivered to the Trustee an Opinion of Counsel or a ruling received from the Internal Revenue Service to the effect that the holders of the Securities of such series will not recognize income, gain or loss for Federal income tax purposes as a result of Parent’s or the Company’s exercise of either option under this Section 11.03 and will be subject to Federal income tax in the same amount and in the same manner and at the same times as would have been the case if such election had not been exercised;
 
(v)            such covenant defeasance shall not (i) cause the Trustee to have a conflicting interest for purposes of the Trust Indenture Act with respect to any Securities or (ii) result in the trust arising from such deposit to constitute, unless it is qualified, a regulated investment company under the Investment Company Act of 1940; and
 
(vi)           notwithstanding any other provisions of this Section 11.03, such covenant defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations which may be imposed on Parent or the Company pursuant to Section 2.01.
 
After such irrevocable deposit made pursuant to this Section 11.03 and satisfaction of the other conditions set forth herein, the Trustee upon request shall acknowledge in writing the discharge of Parent’s and the Company’s obligations pursuant to this Section 11.03.
 
Section 11.04                        Deposited Funds to be Held in Trust .
 
All funds or Governmental Obligations deposited with the Trustee pursuant to Sections 11.02 or 11.03 shall be held in trust and shall be available for payment as due, either directly or through any paying agent (including Parent or the Company acting as its own paying agent), to the holders of the particular series of Securities for the payment or redemption of which such funds or Governmental Obligations have been deposited with the Trustee.
 
Section 11.05                        Payment of Funds Held by Paying Agents .
 
In connection with the provisions of Section 11.02 or 11.03, all funds or Governmental Obligations then held by any paying agent under the provisions of this Indenture shall, upon demand of Parent or the Company, be paid to the Trustee and thereupon such paying agent shall be released from all further liability with respect to such funds or Governmental Obligations.
 
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Section 11.06          Repayment to Parent or the Company .
 
Any funds or Governmental Obligations deposited with any paying agent or the Trustee, or then held by Parent or the Company, in trust for payment of principal of, premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least one year after the date upon which the principal of, premium, if any, or interest on such Securities shall have respectively become due and payable, shall be repaid to Parent or the Company, as applicable, or if then held by Parent or the Company shall be discharged from such trust; and thereafter, the paying agent and the Trustee shall be released from all further liability with respect to such funds or Governmental Obligations, and the holder of any of the Securities entitled to receive such payment shall thereafter, as an unsecured general creditor, look only to Parent or the Company, as applicable, for the payment thereof. Anything in this Article XI to the contrary notwithstanding, subject to Section 7.06, the Trustee shall deliver or pay to Parent or the Company, as applicable, from time to time upon request by Parent or the Company any funds or Governmental Obligations (or other property and any proceeds therefrom) held by it as provided in Sections 11.02 or 11.03 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof that would then be required to be deposited to effect a defeasance or covenant defeasance, as the case may be, in accordance with this Article XI.
 
Section 11.07          Reinstatement .
 
If the Trustee or paying agent is unable to apply any funds or Governmental Obligations in accordance with Section 11.02 or 11.03 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, Parent and the Company’s obligations under this Indenture, any indentures supplemental to this Indenture with respect to the applicable series of Securities and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.02 or 11.03, as the case may be, until such time as the Trustee or paying agent is permitted to apply all such funds or Governmental Obligations in accordance with Section 11.02 or 11.03, as the case may be; provided, however, that if Parent or the Company has made any payment of principal, premium, if any, or interest on any Securities of such series following the reinstatement of its obligations as aforesaid, Parent or the Company, as applicable, shall be subrogated to the rights of the holders of such Securities of such series to receive such payment from the funds or Governmental Obligations held by the Trustee or paying agent.
 
ARTICLE XII.
 
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
 
Section 12.01          No Recourse .
 
No recourse under or upon any obligation, covenant or agreement of this Indenture, or of any Security, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, shareholder, officer or director, past, present or future as such, of Parent or the
 
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Company or of any predecessor or successor corporation, either directly or through Parent or the Company or any such predecessor or 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 this Indenture and the obligations issued hereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, shareholders, officers or directors as such, of Parent or the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, shareholder, officer or director as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issuance of such Securities.
 
ARTICLE XIII.
 
MISCELLANEOUS PROVISIONS
 
Section 13.01          Effect on Successors and Assigns .
 
All the agreements of Parent and the Company in this Indenture or the Securities shall bind its respective successor whether so expressed or not. All agreements of the Trustee in this Indenture shall bind its successor whether so expressed or not.
 
Section 13.02          Actions by Successor .
 
Any act or proceeding by any provision of this Indenture authorized or required to be done or performed by any board, committee or officer of Parent or the Company shall and may be done and performed with like force and effect by the corresponding board, committee or officer of any corporation that shall at the time be the lawful sole successor of Parent or the Company, as applicable.
 
Section 13.03          Notices .
 
Any notice or communication by Parent, the Company or the Trustee to the others is duly given if in writing and delivered in person or mailed by first-class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the other’s address:

If to the Company:	 	Tyco Electronics Group S.A.	
 	 	17, boulevard Grande-Duchesse Charlotte	
 	 	L-1331 Luxembourg	
 	 	Attention: Paul Hussey, Managing Director	
 	 	Facsimile No.: +352 46-43-50	
 
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If to Parent:	 	Tyco Electronics Ltd.	
 	 	96 Pitts Bay Road, Second Floor	
 	 	Pembroke HM 08, Bermuda	
 	 	Attention: H. Gregory Barksdale, Secretary	
 	 	Facsimile No.: 441-294-0604	
 	 	 	
In either case, with copies to:	
 	 	 	
 	 	Tyco Electronics Corporation	
 	 	1050 Westlakes Drive	
 	 	Berwyn, PA 19312	
 	 	Facsimile No.: 610-893-9602	
 	 	Attention: Robert A. Scott, Executive Vice President and
General Counsel	
 	 	 	
and	 	 	
 	 	 	
 	 	Tyco Electronics Corporation	
 	 	1050 Westlakes Drive	
 	 	Berwyn, PA 19312	
 	 	Facsimile No.: 610-893-9494	
 	 	Attention: Mario Calastri, Senior Vice President and	
 	 	Treasurer	
 	 	 	
and	 	 	
 	 	 	
 	 	Gibson, Dunn & Crutcher LLP	
 	 	200 Park Avenue	
 	 	New York, New York 10166	
 	 	Attention: Steven R. Finley	
 	 	Facsimile No.: (212) 351-4035	
 	 	 	
If to the Trustee:	 	Deutsche Bank Trust Company Americas	
 	 	60 Wall Street, 27th Floor	
 	 	MS: NYC60-2710	
 	 	New York, NY 10005	
 	 	Attention: Trust & Securities Services	
 	 	 	
With a copy to:	 	 	
 	 	 	
 	 	Deutsche Bank National Trust Company	
 	 	for Deutsche Bank Trust Company Americas	
 	 	25 DeForest Avenue	
 	 	Mail Stop: SUM01-0105	
 	 	Summit, New Jersey 07901	
 	 	Attn: Trust & Securities Services	
 	 	Facsimile No.: 732-578-4635	
 
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Parent, the Company or the Trustee by notice to the others may designate additional or different addresses for subsequent notices or communications.
 
All notices and communications (other than those sent to Securityholders) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.
 
Any notice or communication to a Securityholder shall be mailed by first-class mail, certified or registered, return receipt requested, to his address shown on the Security Register. Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders.
 
In the event of suspension of regular mail service or by reason of any other cause it shall be impracticable to give notice by mail, then such notification as shall be given with the approval of the Trustee shall constitute sufficient notice for every purpose hereunder.
 
If a notice or communication is mailed in the manner provided above within the time prescribed, it is conclusively presumed duly given, whether or not the addressee receives it.
 
Section 13.04          Governing Law .
 
This Indenture and each Security shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State without regard to conflicts of laws principles that would require the application of any other law. This Indenture is subject to the provisions of the Trust Indenture Act that are required to be part of this Indenture and shall, to the extent applicable, be governed by such provisions.
 
Section 13.05          Treatment of Securities as Debt .
 
It is intended that the Securities will be treated as indebtedness and not as equity for United States federal income tax purposes. The provisions of this Indenture shall be interpreted to further this intention.
 
Section 13.06         Compliance Certificates and Opinions .
 
(a)            Upon any application or demand by Parent or the Company to the Trustee to take any action under any of the provisions of this Indenture, Parent or the Company shall furnish to the Trustee an Officer’s Certificate stating that, in the opinion of the signer, all conditions precedent 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 have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically dealt with by any provision of this Indenture relating to such particular application or demand, no additional certificate or opinion need be furnished.
 
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(b)            Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant in this Indenture shall include:  (1) a statement that the Person making such certificate or opinion has read such covenant or condition; (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 such Person, he has made such examination or investigation as is necessary to enable him 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 or not, in the opinion of such Person, such condition or covenant has been complied with.
 
Section 13.07          Payments on Business Days .
 
Except as provided pursuant to Section 2.01 pursuant to a Board Resolution, and as set forth in an Officer’s Certificate or established in one or more indentures supplemental to this Indenture, in any case where the date of maturity of interest or principal of any Security or the date of redemption of any Security shall not be a Business Day, then payment of principal, premium, if any, or interest or principal and premium, if any, may be made on the next succeeding Business Day with the same force and effect as if made on the nominal date of maturity or redemption, and no interest shall accrue for the period after such nominal date.
 
Section 13.08          Conflict with Trust Indenture Act .
 
If and to the extent that any provision of this Indenture limits, qualifies or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control.
 
Section 13.09          Counterparts .
 
This Indenture may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
Section 13.10          Separability .
 
In case any one or more of the provisions contained in this Indenture or in the Securities of any series shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Indenture or of such Securities, but this Indenture and such Securities shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.
 
Section 13.11          No Adverse Interpretation of Other Agreements .
 
This Indenture may not be used to interpret another indenture, loan or debt agreement of Parent, the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
 
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Section 13.12          Table of Contents, Headings, Etc .
 
The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.
 
Section 13.13          Consent to Jurisdiction and Service of Process .
 
Each of Parent and the Company agrees that any legal suit, action or proceeding brought by any party to enforce any rights under or with respect to this Indenture, any Security and any Guarantee or any other document or the transactions contemplated hereby or thereby may be instituted in any state or federal court in The City of New York, State of New York, United States of America, irrevocably waives to the fullest extent permitted by law any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding, irrevocably waives to the fullest extent permitted by law any claim that and agrees not to claim or plead in any court that any such action, suit or proceeding brought in such court has been brought in an inconvenient forum and irrevocably submits to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding or for recognition and enforcement of any judgment in respect thereof.
 
Each of Parent and the Company hereby irrevocably and unconditionally designates and appoints CT Corporation System, 111 Eighth Avenue, New York, New York 10011, U.S.A. (and any successor entity) as its authorized agent to receive and forward on its behalf service of any and all process which may be served in any such suit, action or proceeding in any such court and agrees that service of process upon CT Corporation shall be deemed in every respect effective service of process upon the Company in any such suit, action or proceeding and shall be taken and held to be valid personal service upon Parent or the Company, as the case may be. Said designation and appointment shall be irrevocable. Nothing in this Section 13.13 shall affect the right of the Holders to serve process in any manner permitted by law or limit the right of the Holders to bring proceedings against Parent or the Company in the courts of any jurisdiction or jurisdictions. Each of Parent and the Company 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 CT Corporation in full force and effect so long as the Securities are outstanding. Each of Parent and the Company hereby irrevocably and unconditionally authorizes and directs CT Corporation to accept such service on its behalf. If for any reason CT Corporation ceases to be available to act as such, each of Parent and the Company agrees to designate a new agent in New York City.
 
To the extent that Parent or the Company has or hereafter may acquire any immunity from jurisdiction of any court (including any court in the United States, the State of New York, Luxembourg, Bermuda or other jurisdiction in which Parent or the Company, or any successor thereof, may be organized or any political subdivisions thereof) or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property or assets, this Indenture, the Securities, the Guarantees or any other documents or actions to enforce judgments in respect of any thereof, then each of Parent and the Company hereby irrevocably waives such immunity, and
 
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any defense based on such immunity, in respect of its obligations under the above-referenced documents and the transactions contemplated thereby, to the extent permitted by law.
 
Section 13.14          Waiver of Jury Trial .
 
EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 
Section 13.15          USA Patriot Act
 
The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with Deutsche Bank Trust Company Americas. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the USA Patriot Act.
 
ARTICLE XIV.
 
ADDITIONAL AMOUNTS; CERTAIN TAX PROVISIONS
 
Section 14.01          Redemption Upon Changes in Withholding Taxes .
 
The Securities of any series may be redeemed, as a whole but not in part, at the option of the Company, upon not less than 30 nor more than 90 days notice (which notice shall be irrevocable), at a redemption price equal to 100% of the principal amount thereof, together with accrued interest, if any, to the redemption date and Additional Amounts (as defined in Section 14.02), if any, if as a result of any amendment to, or change in, the laws or regulations of Luxembourg, Bermuda or the United States, as applicable, or any political subdivision thereof or therein having the power to tax (a “ Taxing Jurisdiction ”) or any change in the application or official interpretation of such laws, including any action taken by a taxing authority or a holding by a court of competent jurisdiction (regardless of whether such action or such holding is with respect to the Company or Parent), which amendment or change is announced or becomes effective after the date the Securities of such series are issued, Parent or the Company has become, or there is a material probability that it will become, obligated to pay Additional Amounts on the next date on which any amount would be payable with respect to the Securities of such series, and such obligation cannot be avoided by the use of commercially reasonable measures available to Parent or the Company, as the case may be; provided, however, that (a) no such notice of redemption may be given earlier than 90 days prior to the earliest date on which Parent or the Company, as the case may be, would be obligated to pay such Additional Amounts, and (b) at the time such notice of redemption is given, such obligation to pay such Additional Amounts remains in effect. Prior to the giving of any notice of redemption described in this paragraph, the Company shall deliver to the Trustee (i)(A) certificate signed by two directors of
 
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the Company stating that the obligation to pay Additional Amounts cannot be avoided by the Company taking commercially reasonable measures available to it or (B) a certificate signed by two Officers of Parent stating that the obligation to pay Additional Amounts cannot be avoided by Parent taking commercially reasonable measures available to it, as the case may be, and (ii) a written opinion of independent legal counsel to Parent or the Company, as the case may be, of recognized standing to the effect that the Company has or there is a material probability that it will become obligated to pay Additional Amounts as a result of a change, amendment, official interpretation or application described above and that Parent or the Company, as the case may be, cannot avoid the payment of such Additional Amounts by taking commercially reasonable measures available to it.
 
Section 14.02          Payment of Additional Amounts .
 
All payments made by Parent or the Company under or with respect to the Securities and the Guarantees will be made free and clear of and without withholding or deduction for or on account of any present or future taxes, duties, levies, imposts, assessments or governmental charges of whatever nature imposed or levied by or on behalf of any Taxing Jurisdiction (“ Taxes ”), unless Parent or the Company, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration thereof. In the event that Parent or the Company is required to so withhold or deduct any amount for or on account of any Taxes from any payment made under or with respect to the Securities or the Guarantees, as the case may be, Parent or the Company, as the case may be, will pay such additional amounts (“ Additional Amounts ”) as may be necessary so that the net amount received by each holder of Securities (including Additional Amounts) after such withholding or deduction will equal the amount that such Holder would have received if such Taxes had not been required to be withheld or deducted; provided that no Additional Amounts will be payable with respect to a payment to a holder of Securities where such holder  is subject to taxation on such payment by a relevant Taxing Jurisdiction for any reason other than the holder’s mere ownership of the Securities or for or on account of:
 
(a)            any Taxes that are imposed or withheld solely because the beneficial owner of such Securities or a fiduciary, settler, beneficiary, or member of the beneficial owner if the beneficial owner is an estate, trust, partnership, limited liability company or other fiscally transparent entity, or a person holding a power over an estate or trust administered by a fiduciary holder:
 
(i)                                      is or was present or engaged in, or is or was treated as present or engaged in, a trade or business in the Taxing Jurisdiction or has or had a permanent establishment in the Taxing Jurisdiction;
 
(ii)            has or had any present or former connection (other than the mere fact of ownership of such Securities) with the Taxing Jurisdiction imposing such Taxes, including being or having been a citizen or resident thereof or being treated as being or having been a resident thereof;
 
(iii)           with respect to any withholding Taxes imposed by the United States, is or was with respect to the United States a personal holding company, a
 
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passive foreign investment company, a controlled foreign corporation, a foreign tax exempt organization or corporation that has accumulated earnings to avoid United States federal income tax; or
 
(iv)           owns or owned 10% or more of the total combined voting power of all classes of stock of the Parent or the Company;
 
(b)            any estate, inheritance, gift, sales, transfer, excise or personal property Taxes imposed with respect to the Securities, except as otherwise provided herein;
 
(c)            any Taxes imposed solely as a result of the presentation of such Securities (where presentation is required) for payment on a date more than 30 days after the date on which such payment became due and payable or the date on which payment thereof is duly provided for, whichever is later, except to the extent that the beneficiary or Holder thereof would have been entitled to the payment of Additional Amounts had the Securities been presented for payment on any date during such 30-day period;
 
(d)            any Taxes imposed solely as a result of the failure of the beneficial owner or any other person to comply with applicable certification, information, documentation or other reporting requirements concerning the nationality, residence, identity or connection with the Taxing Jurisdiction of the holder or beneficial owner of such Securities, if such compliance is required by statute or regulation of the relevant Taxing Jurisdiction as a precondition to relief or exemption from such Taxes;
 
(e)            with respect to withholding Taxes imposed by the United States, any such Taxes imposed by reason of the failure of the beneficial owner to fulfill the statement requirements of sections 871(h) or 881(c) of the Code;
 
(f)             any Taxes that are payable by any method other than withholding or deduction by the Parent or the Company or any paying agent from payments in respect of such Securities;
 
(g)            any Taxes required to be withheld by any paying agent from any payment in respect of any Securities if such payment can be made without such withholding by at least one other paying agent;
 
(h)            any Taxes required to be deducted or withheld pursuant to the European Council Directive 2003/48/EC of June 3, 2003 on the taxation of savings income in the form of interest payments, or any law implementing or complying with, or introduced in order to conform to, that Directive;
 
(i)             any withholding or deduction for Taxes which would not have been imposed if the relevant Securities had been presented to another paying agent in a Member State of the European Union; or
 
(j)             any combination of Section 14.02(a), (b), (c), (d), (e), (f), (g), (h) and (i).
 
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Additional Amounts also will not be payable to a Holder of Securities that is a fiduciary, partnership, limited liability company or other fiscally transparent entity, or to a beneficial owner of Securities that is not the sole beneficial owner of such Securities, as the case may be. This exception, however, will apply only to the extent that a beneficiary or settlor with respect to the fiduciary, or a beneficial owner or member of the partnership, limited liability company or other fiscally transparent entity, would not have been entitled to the payment of an Additional Amount had the beneficiary, settlor, beneficial owner or member  received directly its beneficial or distributive share of the payment.
 
Parent or the Company, as the case may be, will also (i) make such withholding or deduction of Taxes and (ii) remit the full amount of Taxes so deducted or withheld to the relevant Taxing Jurisdiction in accordance with all applicable laws. Parent or the Company, as applicable, will use its commercially reasonable efforts to obtain certified copies of tax receipts evidencing the payment of any Taxes so deducted or withheld from each Taxing Authority imposing such Taxes. Parent or the Company, as the case may be, will, upon request, make available to the holders of the Securities, within 90 days after the date the payment of any Taxes so deducted or withheld is due pursuant to applicable law, certified copies of tax receipts evidencing such payment by Parent or the Company or if, notwithstanding Parent’s or the Company’s efforts to obtain such receipts, the same are not obtainable, other evidence of such payments by Parent or the Company.
 
At least 30 days prior to each date on which any payment under or with respect to the Securities or Guarantees is due and payable, if Parent or the Company will be obligated to pay Additional Amounts with respect to such payment, Parent or the Company will deliver to the Trustee an Officer’s Certificate stating the fact that such Additional Amounts will be payable, the amounts so payable and will set forth such other information as is necessary to enable such Trustee to pay such Additional Amounts to holders of Securities on the payment date.
 
In addition, the Company will pay any stamp, issue, registration, documentary or other similar taxes and duties, including interest, penalties and Additional Amounts with respect thereto, payable in Luxembourg or the United States or any political subdivision or taxing authority of or in the foregoing in respect of the creation, issue, offering, enforcement, redemption or retirement of the Securities.
 
The provisions of this Article XIV shall survive any termination of the discharge of this Indenture and shall apply mutatis mutandis to any jurisdiction in which Parent or the Company or any successor Person to Parent or the Company, as the case may be, is organized or is engaged in business for tax purposes or any political subdivisions or taxing authority or agency thereof or therein; provided, however, the date on which Parent or the Company changes its jurisdiction in which it is organized or such Person becomes a successor to Parent or the Company, as the case may be, shall be substituted for the date on which the series of Securities was issued.
 
Whenever in this Indenture, the Securities or the Guarantees there is mentioned, in any context, the payment of principal and premium, if any, redemption price, interest or any other amount payable under or with respect to any Security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.
 
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ARTICLE XV.
 
GUARANTEES
 
Section 15.01          Guarantee .
 
Parent hereby fully and unconditionally guarantees (i) to each holder of each Security that is authenticated and delivered by the Trustee, and (ii) to the Trustee on behalf of such Holder, the due and punctual payment of the principal of, premium, if any, and interest on such Security when and as the same shall become due and payable, whether at the stated maturity, by acceleration, call for redemption or otherwise, in accordance with the terms of such Security and of this Indenture. In case of the failure of the Company punctually to make any such payment, Parent hereby agrees to cause such payment to be made punctually when and as the same shall become due and payable, whether at the stated maturity or by acceleration, call for redemption or otherwise, and as if such payment were made by the Company.
 
Parent hereby agrees that its obligations hereunder shall be absolute and unconditional, irrespective of, and shall be unaffected by, the validity, regularity or enforceability of such Security or this Indenture, the absence of any action to enforce the same or any release, amendment, waiver or indulgence granted to the Company or Parent or any consent to departure from any requirement of any other guarantee of all or any of the Securities or any other circumstances which might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor. Parent hereby waives the benefits of diligence, presentment, demand for payment, any requirement that the Trustee or any of the Holders protect, secure, perfect or insure any security interest in or other lien on any property subject thereto or exhaust any right or take any action against the Company or any other Person or any collateral, filing of claims with a court in the event of insolvency 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 and all demands whatsoever, and covenants that this Guarantee will not be discharged in respect of such Security except by complete performance of the obligations contained in such Security and in such Guarantee. Parent agrees that if, after the occurrence and during the continuance of an Event of Default, the Trustee or any of the Holders of the applicable series of Securities are prevented by applicable law from exercising their respective rights to accelerate the maturity of such Securities, to collect interest on such Securities, or to enforce or exercise any other right or remedy with respect to such Securities, Parent agrees to pay to the Trustee for the account of such Holders, upon demand therefor, the amount that would otherwise have been due and payable had such rights and remedies been permitted to be exercised by the Trustee or any of such Holders.
 
Parent shall be subrogated to all rights of the holders of the Securities against the Company in respect of any amounts paid by Parent on account of such Security pursuant to the provisions of its Guarantee or this Indenture; provided, however, that Parent shall not be entitled to enforce or to receive any payment arising out of, or based upon, such right of subrogation until the principal of and interest on all Securities of such series issued hereunder shall have been paid in full.
 
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The Guarantee shall remain in full force and effect and continue to be effective should any petition be filed by or against the Company for liquidation or reorganization, should the Company become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee be appointed for all or any part of the Company’s assets, and shall, to the fullest extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any time payment and performance of such Securities, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any holder of such Securities, whether as a “voidable preference,” “fraudulent transfer,” or otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, such Securities shall, to the fullest extent permitted by law, be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.
 
Any term or provision of the Guarantee to the contrary notwithstanding, the aggregate amount of the obligations guaranteed hereunder shall be reduced to the extent necessary to prevent such Guarantee from violating or becoming voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.
 
Section 15.02          Execution and Delivery of Guarantee .
 
The Guarantee shall include the terms of the Guarantee set forth in Section 15.01 and shall be substantially in the form established pursuant to Section 2.16. Parent hereby agrees to execute its Guarantee, in a form established pursuant to Section 2.16, on each Security authenticated and delivered by the Trustee.
 
The Guarantee shall be executed on behalf of Parent by any one of its chairman of the Board of Directors, president, vice presidents or other person duly authorized by Parent’s Board of Directors. The signature of any or all of these persons on the Guarantee may be manual or facsimile.
 
A Guarantee bearing the manual or facsimile signature of individuals who were at any time the proper officers of Parent shall bind Parent, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of any Security or did not hold such offices at the date of such Guarantee.
 
The delivery of any Security by the Trustee, after the authentication thereof, shall constitute due delivery of the Guarantee on behalf of Parent and shall bind Parent notwithstanding the fact that the Guarantee does not bear the signature of Parent. Parent agrees that its Guarantee set forth in Section 15.01 and in the form of Guarantee established pursuant to Section 2.16 shall remain in full force and effect notwithstanding any failure to execute a Guarantee on any such Security.
 
Section 15.03          Release of Guarantee .
 
Notwithstanding anything in this Article XV to the contrary, concurrently with the payment in full of the principal of, premium, if any, and interest on Securities of a series, Parent shall be released from and relieved of its obligations under this Article XV with respect to the
 
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Securities of such series. Upon the delivery by the Company to the Trustee of an Officer’s Certificate and an Opinion of Counsel to the effect that the transaction giving rise to the release of this Guarantee was made by the Company in accordance with the provisions of this Indenture and the Securities, the Trustee shall execute any documents reasonably required in order to evidence the release of Parent from its obligations under this Guarantee. If any of the obligations to pay the principal of, premium, if any, and interest on such Securities and all other obligations of the Company are revived and reinstated after the termination of this Guarantee, then all of the obligations of Parent under this Guarantee shall be revived and reinstated as if this Guarantee had not been terminated until such time as the principal of, premium, if any, and interest on such Securities are paid in full, and Parent shall enter into an amendment to this Guarantee, reasonably satisfactory to the Trustee, evidencing such revival and reinstatement.
 
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed all as of the day and year first above written.

 	TYCO ELECTRONICS GROUP S.A.	
 	 	 	
 	By:	/s/ Mario Calastri	 	
 	 	Name:	Mario Calastri	
 	 	Title:	Director	

 	TYCO ELECTRONICS LTD.	
 	 	 	
 	By:	/s/ Terrence R. Curtin	 	
 	 	Name:	Terrence R. Curtin	
 	 	Title:	Executive Vice President and	
 	 	 	Chief Financial Officer	

 	DEUTSCHE BANK TRUST COMPANY
AMERICAS	
 	as Trustee	
 	 	 	
 	By:	/s/ Richard L. Buckwalter	 	
 	 	Name:	Richard L. Buckwalter	
 	 	Title:	Director	

 	By:	/s/ Carol Ng	 	
 	 	Name:	Carol Ng	
 	 	Title:	Vice President	

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EXHIBIT A
 
FORM OF CERTIFICATE OF TRANSFER
 
Tyco Electronics Group S.A.
17, boulevard Grande-Duchesse Charlotte
L-1331 Luxembourg
Attention: The Managing Directors
 
[Trustee]
[Address]
 
Re: [insert description of Securities]
 
Ladies and Gentlemen,
 
Reference is hereby made to the Indenture, dated as of                ,       , among Tyco Electronics Group S.A., a Luxembourg company (the “ Company ”), Tyco Electronics Ltd., a Bermuda company (“ Parent ”), and                       , a                       , as trustee (the “ Trustee ”), [as supplemented by that certain supplemental indenture dated as of                 ][and the Board Resolution adopted                  ] (together, the “ Indenture ”). Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.                            (the “ Transferor ”) owns and proposes to transfer the Security or Securities or interest[s] in such Security or Securities specified in Annex A hereto, in the principal amount of $                  in such Security or Securities or interest[s] (the “ Transfer ”), to                   (the “ Transferee ”), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:
 
[CHECK ALL THAT APPLY
 
1.              o             Check if Transferee will take delivery of a beneficial interest in the 144A Global Security or a Definitive Security Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “ Securities Act ”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Security is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Security for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A (a “ QIB ”) in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any State of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Security and/or the Definitive Security and in the Indenture and the Securities Act.
 
2.              o             Check if Transferee will take delivery of a beneficial interest in the Regulation
 
A-1

 
S Global Security or a Definitive Security pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (y) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (z) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904 (b) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed Transfer is being made prior to the expiration of the Distribution Compliance Period, the Transfer is not being made to a U.S. person (as such is defined in Regulation S) or for the account or benefit of a U.S. person (other than an initial purchaser of the Securities) and the interest transferred will be held immediately thereafter through Euroclear or Clearstream. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Regulation S Global Security and/or the Definitive Security and in the Indenture and the Securities Act.
 
3.              o             Check and complete if Transferee will take delivery of a beneficial interest in a Definitive Security pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Securities and Restricted Definitive Securities and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any State of the United States, and accordingly the Transferor hereby further certifies that (check one):
 
(a)            o             Such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or
 
(b)            o             Such Transfer is being effected to the Company or a subsidiary thereof; or
 
(c)            o             Such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or
 
(d)            o             Such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Security or Restricted Definitive Security and the requirements of the exemption claimed, which certification is supported by a
 
A-2

 
certificate executed by the Transferee in the form attached as Exhibit C to the Indenture. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the Definitive Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Definitive Security and in the Indenture and the Securities Act.
 
4.              o             Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Security or of an Unrestricted Definitive Security.
 
(a)            o             Check if Transfer is pursuant to Rule 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities, on Restricted Definitive Securities and in the Indenture and the Securities Act.
 
(b)            o             Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities, on Restricted Definitive Securities and in the Indenture and the Securities Act.
 
(c)            o             Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities or Restricted Definitive Securities and in the Indenture.
 
A-3

 
This certificate and the statements contained herein are made for your benefit and the benefit of the Company.

 	 	Dated:	

[Insert Name of Transferor]

By:	 	 	
 	Name:	 	
 	Title:	 	

A-4

 
ANNEX A TO CERTIFICATE OF TRANSFER
 
1.              The Transferor owns and proposed to transfer the following:
 
[CHECK ONE OF (a) OR (b)]
 
(a)            o             a beneficial interest in the:
 
(i)             o             144A Global Security (CUSIP           ), or
 
(ii)            o             Regulation S Global Security (CUSIP           ), or
 
(b)            o             a Restricted Definitive Security.
 
2.              After the transfer the Transferee will hold:
 
(a)            o             a beneficial interest in the:
 
(i)             o             144A Global Security (CUSIP            ), or
 
(ii)            o             Regulation S Global Security (CUSIP           ), or
 
(iii)           o             Unrestricted Global Security (CUSIP            ); or
 
(b)            o             a Restricted Definitive Security; or
 
(c)            o             an Unrestricted Definitive Security,
 
in accordance with the terms of the Indenture.
 
A-5

 
EXHIBIT B
 
FORM OF CERTIFICATE OF EXCHANGE
 
Tyco Electronics Group S.A.
17, boulevard Grande-Duchesse Charlotte
L-1331 Luxembourg
Attention: The Managing Directors
 
[Trustee]
[Address of Trustee]
 
Re: [insert description of the Securities]
 
Ladies and Gentlemen,
 
Reference is hereby made to the Indenture, dated as of                  ,       , among Tyco Electronics Group S.A., a Luxembourg company (the “ Company ”), Tyco Electronics Ltd., a Bermuda company (“ Parent ”), and                          , a                          , as trustee (the “ Trustee ”) [as supplemented by that certain supplemental indenture dated as of              ][and the Board Resolution adopted                ] (together, the “ Indenture ”). Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
 
                            , (the “ Owner ”) owns and proposes to transfer the Security or Securities or interest[s] in such Security or Securities specified herein, in the principal amount of $              in such Security or Securities or interest[s] (the “ Exchange ”). In connection with the Transfer, the Transferor hereby certifies that:
 
1.              Exchange of Restricted Definitive Securities or Beneficial Interests in a Restricted Global Security for Unrestricted Definitive Securities or Beneficial Interests in an Unrestricted Global Security.
 
(a)            o             Check if Exchange is from beneficial interest in a Restricted Global Security to beneficial interest in an Unrestricted Global Security. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for a beneficial interest in an Unrestricted Global Security in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Securities and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the “ Securities Act ”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Security is being acquired in compliance with any applicable blue sky securities laws of any State of the United States.
 
B-1

 
(b)            o             Check if Exchange is from beneficial interest in a Restricted Global Security to Unrestricted Definitive Security. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for an Unrestricted Definitive Security in an equal principal amount, the Owner hereby certifies (i) the Definitive Security is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Securities and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Security is being acquired in compliance with any applicable blue sky securities laws of any State of the United States.
 
(c)            o             Check if Exchange is from Restricted Definitive Security to beneficial interest in an Unrestricted Global Security. In connection with the Owner’s Exchange of a Restricted Definitive Security for a beneficial interest in an Unrestricted Global Security, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Securities and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Security is being acquired in compliance with any applicable blue sky securities laws of any State of the United States.
 
(d)            o             Check if Exchange is from Restricted Definitive Security to Unrestricted Definitive Security. In connection with the Owner’s Exchange of a Restricted Definitive Security for an Unrestricted Definitive Security, the Owner hereby certifies (i) the Unrestricted Definitive Security is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Securities and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Security is being acquired in compliance with any applicable blue sky securities laws of any State of the United States.
 
2.              Exchange of Restricted Definitive Securities or Beneficial Interests in Restricted Global Securities for Restricted Definitive Securities or Beneficial Interests in Restricted Global Securities.
 
(a)            o             Check if Exchange is from beneficial interest in a Restricted Global Security to Restricted Definitive Security. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for a Restricted Definitive Security with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Security is being acquired for the Owner’s own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Security issued will continue to be subject to the restrictions on transfer enumerated in the
 
B-2

 
Private Placement Legend printed on the Restricted Definitive Security and in the Indenture and the Securities Act.
 
(b)            o             Check if Exchange is from Restricted Definitive Security to beneficial interest in a Restricted Global Security. In connection with the Exchange of the Owner’s Restricted Definitive Security for a beneficial interest in the: [CHECK ONE] o 144A Global Security or o Regulation S Global Security with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Global Securities and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any State of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Security and in the Indenture and the Securities Act.
 
B-3

 
This certificate and the statements contained herein are made for your benefit and the benefit of the Company.

 	 	
[Insert Name of Owner]

By:	 	 	
 	Name:	 	
 	Title:	 	

 

Dated:	 	 	

B-4

 
EXHIBIT C
 
FORM OF CERTIFICATE FROM ACQUIRING
INSTITUTIONAL ACCREDITED INVESTOR
 
Tyco Electronics Group S.A.
17, boulevard Grande-Duchesse Charlotte
L-1331 Luxembourg
Attention: The Managing Directors
 
[Trustee]
[Address of Trustee]
 
Re: [insert description of the Securities]
 
Ladies and Gentlemen,
 
Reference is hereby made to the Indenture, dated as of                    ,      , among Tyco Electronics Group S.A., a Luxembourg company (the “ Company ”), Tyco Electronics Ltd., a Bermuda company (“ Parent ”), and                                   , a                                   , as trustee (the “ Trustee ”) [as supplemented by that certain supplemental indenture dated as of                ][and the Board Resolution adopted                  ] (together, the “ Indenture ”). Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
 
In connection with our proposed purchase of $               aggregate principal amount of: (a) a beneficial interest in a Global Security, or (b) a Definitive Security, we confirm that:
 
1.              We understand that any subsequent transfer of the Securities or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Securities or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the “ Securities Act ”).
 
2.              We understand that the offer and sale of the Securities have not been registered under the Securities Act, and that the Securities and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Securities or any interest therein, we will do so only (1) in the United States to a person whom the seller reasonably believes is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) in a transaction meeting the requirements of Rule 144A, (2) outside the United States in an offshore transaction in accordance with Rule 904 under the Securities Act, (3) pursuant to an exemption from registration under the Securities Act provided by Rule 144 thereunder (if available) or (4) pursuant to an effective registration statement under the Securities Act, in each of cases (1) through (4) in accordance with any applicable securities laws of any
 
C-1

 
state of the United States, and we further agree to notify any purchaser of the Securities from us of the resale restrictions referred to above.
 
3.              We understand that, on any proposed resale of the Securities or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that any subsequent transfer by us of the Securities or beneficial interest therein acquired by us must be effected through one of the initial purchasers of the Securities.
 
4.              We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Securities, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment.
 
5.              We are acquiring the Securities or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional “accredited investor”) as to each of which we exercise sole investment discretion.
 
C-2

 
You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.

 	  Dated:	 	,	 	 	
[Insert Name of Accredited Investor]

By:	 	 	
 	Name:	 	
 	Title:	 	

C-3

EXHIBIT 4.1(b)

TYCO ELECTRONICS GROUP S.A.,
as Issuer
 
AND
 
TYCO ELECTRONICS LTD.,
as Guarantor
 
AND
 
DEUTSCHE BANK TRUST
COMPANY AMERICAS,
as Trustee

FIRST SUPPLEMENTAL INDENTURE
Dated as of September 25, 2007

$800,000,000 of 6.000% Senior Notes due 2012

 
THIS FIRST SUPPLEMENTAL INDENTURE is dated as of September 25, 2007 among TYCO ELECTRONICS GROUP S.A., a Luxembourg company (the “ Company ”), TYCO ELECTRONICS LTD., a Bermuda company (“ Parent ”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation (the “ Trustee ”).
 
RECITALS
 
A.                                    Parent, the Company and the Trustee executed and delivered an Indenture, dated as of September 25, 2007, (the “ Base Indenture ”), to provide for the issuance by the Company from time to time of unsubordinated debt securities evidencing its unsecured indebtedness.
 
B.                                      Pursuant to Board Resolution, the Company has authorized the issuance of the $800,000,000 principal amount of 6.000% Senior Notes due 2012 (the “ Offered Securities ”).
 
C.                                      The entry into this First Supplemental Indenture by the parties hereto is in all respects authorized by the provisions of the Base Indenture.
 
D.                                     Parent and the Company desire to enter into this First Supplemental Indenture pursuant to Section 9.01 of the Base Indenture to establish the terms of the Offered Securities in accordance with Section 2.01 of the Base Indenture and to establish the form of the Offered Securities in accordance with Section 2.02 of the Base Indenture.
 
E.                                       All things necessary to make this First Supplemental Indenture a valid indenture and agreement according to its terms have been done.
 
NOW, THEREFORE, for and in consideration of the foregoing premises, Parent, the Company and the Trustee mutually covenant and agree for the equal and proportionate benefit of the respective holders from time to time of the Offered Securities as follows:
 
ARTICLE I
 
Section 1.1.                                    Terms of Offered Securities .
 
The following terms relate to the Offered Securities:
 
(1)                                   The Offered Securities constitute a series of securities having the title “6.000% Senior Notes due 2012”.
 
(2)                                   The initial aggregate principal amount of the Offered Securities that may be authenticated and delivered under the Base Indenture (except for Offered Securities authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of, other Offered Securities pursuant to Section 2.05, 2.06, 2.07, 2.11, or 3.03) is $800,000,000.
 
(3)                                   The entire Outstanding principal of the Offered Securities shall be payable on October 1, 2012.

 
(4)                                   (A)                               The rate at which the Offered Securities shall bear interest initially shall be 6.000% per year (the “ Original Interest Rate ”) plus Special Interest, if any, payable pursuant to the Exchange and Registration Rights Agreement and as set forth in the Offered Securities, and shall be subject to adjustments as provided in Section 1.1(4)(B). The date from which interest shall accrue on the Offered Securities shall be September 25, 2007, or the most recent Interest Payment Date to which interest has been paid or provided for. The Interest Payment Dates for the Offered Securities shall be April 1 and October 1 of each year, beginning April 1, 2008. Interest shall be payable on each Interest Payment Date to the holders of record at the close of business on the March 16 and September 15 prior to each Interest Payment Date (a “ regular record date ”). The basis upon which interest shall be calculated shall be that of a 360-day year consisting of twelve 30-day months.
 
(B)                                 The interest rate payable on the Offered Securities shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to the Offered Securities as set forth in this Section 1.1(4)(B). If the rating from Moody’s, S&P or Fitch of the Offered Securities is decreased to a rating set forth in the immediately following table, the interest rate on the Offered Securities shall increase from the Original Interest Rate by adding the percentage set forth opposite the rating applicable to the lowest two rating levels assigned to such Offered Securities by any of Moody’s, S&P and Fitch:

Rating Agency	 	
Moody’s	 	S&P	 	Fitch	 	Percentage	 	
Ba1	 	BB+	 	BB+	 	0.25	%	
Ba2	 	BB	 	BB	 	0.50	%	
Ba3	 	BB-	 	BB-	 	0.75	%	
B1 or below	 	B or below	 	B or below	 	1.00	%	
 
If at any time the interest rate on the Offered Securities has been adjusted upward and Moody’s, S&P or Fitch, as the case may be, subsequently increases its rating of the Offered Securities to any of the threshold ratings set forth above, the interest rate on the Offered Securities shall be decreased such that the interest rate for the Offered Securities equals the Original Interest Rate plus the percentages set forth opposite the ratings from the tables above in effect immediately following the increase applicable to the two lowest rating levels assigned to such Offered Securities by any of Moody’s, S&P or Fitch. If Moody’s subsequently increases its rating of the Offered Securities to Baa3 or higher, S&P increases its rating to BBB- or higher and Fitch increases its rating to BBB- or higher, the interest rate on the Offered Securities will be decreased to the Original Interest Rate.
 
Each adjustment required by any decrease or increase in a rating set forth above, whether occasioned by the action of Moody’s, S&P or Fitch, shall be made independent of any and all other adjustments; provided that in determining any adjustment, the percentage applicable to the lowest two rating levels assigned to the Offered Securities by any of Moody’s, S&P and Fitch shall be used. In no event shall (1) the interest rate for the Offered Securities be reduced to below the Original Interest Rate or (2) the total increase in the interest rate on the Offered Securities exceed 2.00% above the Original Interest Rate.
 
3

 
If any two of Moody’s, S&P or Fitch cease to provide a rating of the Offered Securities, any subsequent increase or decrease in the interest rate of the Offered Securities necessitated by a reduction or increase in the rating by the agency continuing to provide the rating shall be twice the percentage set forth in the applicable table above. No adjustments in the interest rate of the Offered Securities shall be made solely as a result of Moody’s, S&P or Fitch ceasing to provide a rating. If Moody’s, S&P and Fitch all cease to provide a rating of the Offered Securities, the interest rate on the Offered Securities shall increase to, or remain at, as the case may be, 2.00% above the Original Interest Rate. References to Moody’s, S&P and Fitch in this Section 1.1(4)(B) shall be deemed to include any successors to Moody’s, S&P and Fitch.
 
Any interest rate increase or decrease described above will take effect from the first day of the interest period during which a rating change requires an adjustment in the interest rate.
 
The interest rate on the Offered Security will permanently cease to be subject to any adjustments described in this Section 1.1(4)(B) (notwithstanding any subsequent decrease in the ratings by any or all of Moody’s, S&P or Fitch or any or all of Moody’s, S&P or Fitch ceasing to provide ratings) and shall be set at the Original Interest Rate if the Offered Securities become rated A3, A- or A- or higher by any two of Moody’s, S&P and Fitch, respectively (or one of these ratings if only rated by one of Moody’s, S&P and Fitch), with a stable or positive outlook by both such rating agencies.
 
(5)                                   The Offered Securities shall be issuable in whole in the form of one or more registered Restricted Global Securities, and the Depository for such Restricted Global Securities shall be The Depository Trust Company, New York, New York. The Offered Securities shall be substantially in the form attached hereto as Exhibit A the terms of which are herein incorporated by reference. The Offered Securities shall be issuable in denominations of $2,000 or any integral multiple of $1,000 in excess thereof.
 
(6)                                   (A)                               The Offered Securities will be subject to redemption at the option of the Company on any date (a “ Redemption Date ”) prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), at a redemption price equal to the greater of (i) 100% of the principal amount of the Offered Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 25 basis points (such greater amount is referred to herein as the “ Redemption Price ”), plus accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date.
 
(B)                                 As used herein:
 
“ Adjusted Redemption Treasury Rate ”, with respect to any Redemption Date, means the  rate equal to the semiannual equivalent yield to maturity or interpolated (on a 30/360 day count basis) yield to maturity of the Comparable Redemption Treasury Issue, assuming a
 
4

price for the Comparable Redemption Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Redemption Treasury Price for such Redemption Date.
 
“ Comparable Redemption Treasury Issue ” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Offered Securities to be redeemed that will be utilized 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 Offered Securities.
 
“ Comparable Redemption Treasury Price ”, with respect to any Redemption Date, means (i) the average of the Redemption Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Redemption Reference Treasury Dealer Quotations (unless there is more than one highest or lowest quotation, in which case only one such highest and/or lowest quotation shall be excluded), or (ii) if the Quotation Agent obtains fewer than four such Redemption Reference Treasury Dealer Quotations, the average of all such Redemption Reference Treasury Dealer Quotations.
 
“ Quotation Agent ” means a Redemption Reference Treasury Dealer appointed as such agent by the Company.
 
“ Redemption Reference Treasury Dealer ” means four primary U.S. Government securities dealers in the United States selected by the Company.
 
“ Redemption Reference Treasury Dealer Quotations ”, with respect to each Redemption Reference Treasury Dealer and any Redemption Date, means the average, as determined by the Quotation Agent, of the bid and offer prices at 11:00 a.m. New York City time for the Comparable Redemption Treasury Issue (expressed in each case as a percentage of its principal amount) for settlement on the Redemption Date quoted in writing to the Quotation Agent by such Redemption Reference Treasury Dealer on the third Business Day preceding such Redemption Date.
 
(7)                                   The Offered Securities will not have the benefit of any sinking fund.
 
(8)                                   Except as provided herein, the holders of the Offered Securities shall have no special rights in addition to those provided in the Base Indenture upon the occurrence of any particular events.
 
(9)                                   The Offered Securities will be general unsecured and unsubordinated obligations of the Company and will be ranked equally among themselves.
 
(10)                             The Offered Securities are not convertible into shares of common stock or other securities of the Company.
 
(11)                             The additional Event of Default and restrictive covenants set forth in Sections 1.3 and 1.4 shall be applicable to the Offered Securities.
 
5

 
Section 1.2                                       Additional Defined Terms .
 
As used herein, the following defined terms shall have the following meanings with respect to the Offered Securities only:
 
“ Accounts Receivable ” of any Person means the accounts receivable of such Person generated by the sale of inventory to third-party customers in the ordinary course of business.
 
“ Attributable Debt ”, in connection with a Sale and Lease-Back Transaction, as of any particular time, means the aggregate of present values (discounted at a rate that, at the inception of the lease, represents the effective interest rate that the lessee would have incurred to borrow over a similar term the funds necessary to purchase the leased assets) of the obligations of the Company or any Restricted Subsidiary for net rental payments during the remaining term of the applicable lease, including any period for which such lease has been extended or, at the option of the lessor, may be extended. The term “net rental payments” under any lease of any period shall mean the sum of the rental and other payments required to be paid in such period by the lessee thereunder, not including any amounts required to be paid by such lessee, whether or not designated as rental or additional rental, on account of maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges required to be paid by such lessee thereunder or any amounts required to be paid by such lessee thereunder contingent upon the amount of sales, maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges.
 
“ Below Investment Grade Rating Event ” means the Offered Securities are rated below an Investment Grade Rating by at least two of the Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of the Change of Control (which 60-day period shall be extended so long as the rating of the Offered Securities is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall be deemed not to have occurred in respect of a particular Change of Control (and thus shall be deemed not to be a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the rating agencies making the reduction in rating to which this definition would otherwise apply do not publicly announce or publicly confirm or inform the Trustee in writing at its request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
 
“ Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
 
“ Change of Control ” means the occurrence of any of (1) the direct or indirect sale, 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 Parent and its subsidiaries taken as a whole to any person or group of persons for purposes of Section 13(d) of the Exchange Act other than Parent or one of its subsidiaries or a person controlled by Parent or
 
6

 
one of its subsidiaries; (2) consummation of any transaction (including any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than Parent’s or its subsidiaries’ employee benefit plans, becomes the beneficial owner (as defined in Rules 13(d)(3) and 13(d)(5) under the Exchange Act), directly or indirectly, of more than 50% of the outstanding voting stock of Parent, measured by voting power rather than number of shares; or (3) the replacement of a majority of the board of directors of Parent over a two-year period from the directors who constituted the board of directors of Parent at the beginning of such period, and such replacement shall not have been approved by at least a majority of the board of directors of Parent then still in office (either by a specific vote or by approval of a proxy statement in which such member was named as a nominee for election as a director, without objection to such nomination) who either were members of such board of directors at the beginning of such period or whose election as a member of such board of directors was previously so approved; provided, that, a transaction effected to create a holding company for Parent will not be deemed to involve a Change of Control if: (1) pursuant to such transaction Parent becomes a direct or indirect wholly-owned subsidiary of such 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 Parent’s voting stock immediately prior to that transaction. Following any such transaction, references in this definition to Parent shall be deemed to refer to such holding company. For purposes of this definition, “voting stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) 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.
 
“ Consolidated Net Worth ” at any date means total assets less total liabilities, in each case appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet.
 
“ Consolidated Tangible Assets ” at any date means total assets less all intangible assets appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet. “Intangible assets” means the amount (if any) stated under the heading “Goodwill and Other Intangible assets, net” or under any other heading of intangible assets separately listed, in each case on the face of such consolidated balance sheet.
 
“ Exchange and Registration Rights Agreement ” means the Exchange and Registration Rights Agreement, dated as of September 25, 2007, between the Company, Parent and the other parties named on the signature pages thereof, relating to the Offered Securities, as such agreement may be amended or supplemented from time to time and, with respect to any debt securities (other than the Offered Securities) issued under this Indenture as part of the same series as the Offered Securities, one or more registration rights agreements among the Company, Parent and the other parties thereto, as such agreement(s) may be amended or supplemented from time to time, relating to rights given by the Company and Parent to the purchasers of such additional debt securities to register such additional debt securities under the Securities Act.
 
7

 
“ Fitch ” means Fitch Ratings Ltd.
 
“ Funded Indebtedness ” means any Indebtedness maturing by its terms more than one year from the date of the determination thereof, including any Indebtedness renewable or extendible at the option of the obligor to a date later than one year from the date of the determination thereof.
 
“ Indebtedness ” means, without duplication, the principal amount (such amount being the face amount or, with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities, determined based on the accreted amount as of the date of the most recently prepared consolidated balance sheet of Parent and its Subsidiaries as of the end of a fiscal quarter of Parent prepared in accordance with United States generally accepted accounting principles as in effect on the date of such consolidated balance sheet) of (i) all obligations for borrowed money, (ii) all obligations evidenced by debentures, notes or other similar instruments, (iii) all obligations in respect of letters of credit or bankers acceptances or similar instruments or reimbursement obligations with respect thereto (such instruments to constitute Indebtedness only to the extent that the outstanding reimbursement obligations in respect thereof are collateralized by cash or cash equivalents reflected as assets on a balance sheet prepared in accordance with United States generally accepted accounting principles), (iv) all obligations to pay the deferred purchase price of property or services, except (A) trade and similar accounts payable and accrued expenses, (B) employee compensation, deferred compensation and pension obligations, and other obligations arising from employee benefit programs and agreements or other similar employment arrangements, (C) obligations in respect of customer advances received and (D) obligations in connection with earnout and holdback agreements, in each case in the ordinary course of business, (v) all obligations as lessee to the extent capitalized in accordance with United States generally accepted accounting principles and (vi) all Indebtedness of others consolidated in such balance sheet that is guaranteed by the Company or any of its Subsidiaries or for which the Company or any of its Subsidiaries is legally responsible or liable (whether by agreement to purchase indebtedness of, or to supply funds or to invest in, others).
 
“ Investment Grade Rating ” means a rating equal to or higher than BBB– (or the equivalent) by Fitch, Baa3 (or the equivalent) by Moody’s and BBB– (or the equivalent) by S&P.
 
“ Moody’s ” means Moody’s Investor Services Inc.
 
“ Non-Recourse Indebtedness ” means Indebtedness upon the enforcement of which recourse may be had by the holder(s) thereof only to identified assets of Parent or the Company or any Subsidiary of Parent or the Company and not to Parent or the Company or any Subsidiary of Parent or the Company personally (subject to, for the avoidance of doubt, customary exceptions contained in non-recourse financings to the non-recourse nature of the obligations thereunder).
 
“ Principal Property ” means any U.S. manufacturing, processing or assembly plant or any U.S. warehouse or distribution facility of the Parent or any of its Subsidiaries that is used by any U.S. Subsidiary of the Company and (A) is owned by the Parent or any Subsidiary of the Parent on the date hereof, (B) the initial construction of which has been completed after the date
 
8

hereof, or (C) is acquired after the date hereof, in each case, other than any such plants, facilities, warehouses or portions thereof, that in the opinion of the Board of Directors of the Company, are not collectively of material importance to the total business conducted by the Parent and its subsidiaries as an entirety, or that has a net book value (excluding any capitalized interest expense), on the date hereof in the case of clause (A) of this definition, on the date of completion of the initial construction in the case of clause (B) of this definition or on the date of acquisition in the case of clause (C) of this definition, of less than the greater of $50,000,000 and 0.50% of Consolidated Tangible Assets on the consolidated balance sheet of Parent and its subsidiaries as of the applicable date.
 
“ Qualifying Subsidiary ” means a U.S. Subsidiary, the total Accounts Receivable of which exceeds the greater of $2.5 million and 0.20% of the amount stated under the heading “Accounts receivable, net of allowance for doubtful accounts,” or its equivalent, appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles.
 
“ Rating Agencies ” means (1) each of Fitch, Moody’s and S&P; and (2) if any of Fitch, Moody’s or S&P ceases to rate the Offered Securities or fails to make a rating of the Offered Securities publicly available for reasons outside of the Company’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 certified by a resolution of the Company’s Board of Directors) as a replacement agency for Fitch, Moody’s or S&P, or all of them, as the case may be .
 
“ Restricted Subsidiary ” means any Subsidiary of the Company that owns or leases a Principal Property.
 
“ Sale and Lease-Back Transaction ” means an arrangement with any Person providing for the leasing by the Company or a Restricted Subsidiary of any Principal Property whereby such Principal Property has been or is to be sold or transferred by the Company or a Restricted Subsidiary to such Person other than Parent, the Company or any of their respective Subsidiaries; provided, however, that the foregoing shall not apply to any such arrangement involving a lease for a term, including renewal rights, for not more than three years.
 
“ S&P ” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.
 
“ Special Interest ” means all additional interest then owing pursuant to the Exchange and Registration Rights Agreement.
 
“ U.S. Subsidiary ” means any Subsidiary organized under the laws of a jurisdiction of the United States or any political subdivision thereof.
 
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Section 1.3.                                    Additional Covenants .
 
The following additional covenants shall apply with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding (but subject to defeasance, as provided in the Indenture):
 
(1)                                   Limitation on Liens.
 
The Company will not, and will not permit any Restricted Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a mortgage, pledge, security interest, lien or encumbrance (each a “ lien ”) upon any property that at the time of such issuance, assumption or guarantee constitutes a Principal Property, and the Company will not, and will not permit any U.S. Subsidiary that at the time of such issuance, assumption or guarantee is a Qualifying Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a lien upon such Qualifying Subsidiary’s Accounts Receivables, or any shares of stock of or Indebtedness issued by any such Restricted Subsidiary or such Qualifying Subsidiary, whether now owned or hereafter acquired, in each case without effectively providing that, for so long as such lien shall continue in existence with respect to such secured Indebtedness, the Offered Securities (together with, if the Company shall so determine, any other Indebtedness of the Company ranking equally with the Offered Securities, it being understood that for purposes hereof, Indebtedness which is secured by a lien and Indebtedness which is not so secured shall not, solely by reason of such lien, be deemed to be of different ranking) shall be equally and ratably secured by a lien ranking ratably with or equal to (or at the Company’s option prior to) such secured Indebtedness; provided, however, that the foregoing covenant shall not apply to:
 
(a)                                   liens existing on the date the Offered Securities are first issued;
 
(b)                                  liens on the stock, assets or Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary, unless created in contemplation of such Person becoming a Restricted Subsidiary;
 
(c)                                   liens on any assets or Indebtedness of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or a Restricted Subsidiary or at the time of a purchase, lease or other acquisition of the assets of a corporation or firm as an entirety or substantially as an entirety by the Company or any Restricted Subsidiary;
 
(d)                                  liens on any Principal Property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary, or liens to secure the payment of the purchase price of such Principal Property by the Company or any Restricted Subsidiary, or to secure any Indebtedness incurred, assumed or guaranteed by the Company or a Restricted Subsidiary for the purpose of financing all or any part of the purchase price of such Principal Property or improvements or construction thereon, which Indebtedness is incurred, assumed or guaranteed prior to, at the time of or within one year after such acquisition (or in the case of real property, completion of such improvement or construction or commencement of full operation of such property, whichever is later); provided, however, that in the case of any such acquisition, construction or improvement,
 
10

the lien shall not apply to any Principal Property theretofore owned by the Company or a Restricted Subsidiary, other than the Principal Property so acquired, constructed or improved (and accessions thereto and improvements and replacements thereof and the proceeds of the foregoing);
 
(e)                                   liens securing Indebtedness owing by any subsidiary to the Company, Parent or a subsidiary thereof or by the Company to Parent;
 
(f)                                     liens in favor of the United States or any State thereof, or any department, agency or instrumentality or political subdivision of the United States of America or any State thereof, or in favor of any other country or any political subdivision thereof, to secure partial, progress, advance or other payments pursuant to any contract, statute, rule or regulation or to secure any Indebtedness incurred or guaranteed for the purpose of financing all or any part of the purchase price (or, in the case of real property, the cost of construction or improvement) of the Principal Property or assets subject to such liens (including liens incurred in connection with pollution control, industrial revenue or similar financings);
 
(g)                                  pledges, liens or deposits under workers’ compensation or similar legislation, and liens thereunder that are not currently dischargeable, or in connection with bids, tenders, contracts (other than for the payment of money) or leases to which the Company or any subsidiary is a party, or to secure the public or statutory obligations of the Company or any subsidiary, or in connection with obtaining or maintaining self-insurance, or to obtain the benefits of any law, regulation or arrangement pertaining to unemployment insurance, old age pensions, social security or similar matters, or to secure surety, performance, appeal or customs bonds to which the Company or any subsidiary is a party, or in litigation or other proceedings in connection with the matters heretofore referred to in this clause, such as interpleader proceedings, and other similar pledges, liens or deposits made or incurred in the ordinary course of business;
 
(h)                                  liens created by or resulting from any litigation or other proceeding that is being contested in good faith by appropriate proceedings, including liens arising out of judgments or awards against the Company or any subsidiary with respect to which the Company or such subsidiary in good faith is prosecuting an appeal or proceedings for review or for which the time to make an appeal has not yet expired; or final unappealable judgment liens which are satisfied within 15 days of the date of judgment; or liens incurred by the Company or any subsidiary for the purpose of obtaining a stay or discharge in the course of any litigation or other proceeding to which the Company or such subsidiary is a party;
 
(i)                                      liens for taxes or assessments or governmental charges or levies not yet due or delinquent; or that can thereafter be paid without penalty, or that are being contested in good faith by appropriate proceedings; landlord’s liens on property held under lease; and any other liens or charges incidental to the conduct of the business of the Company or any subsidiary, or the ownership of their respective assets, that were not incurred in connection with the borrowing of money or the obtaining of advances or credit and that, in the opinion of the Board of Directors of the Company, do not
 
11

materially impair the use of such assets in the operation of the business of the Company or such subsidiary or the value of such Principal Property or assets for the purposes of such business;
 
(j)                                      liens to secure the Company’s or any subsidiary’s obligations under agreements with respect to spot, forward, future and option transactions, entered into in the ordinary course of business;
 
(k)                                   liens on (including securitization programs with respect to) accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as defined in the Uniform Commercial Code of the State of New York) (i) existing at the time of acquisition thereof by the Company or any U.S. Subsidiary or (ii) of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or any U.S. Subsidiary; provided that such liens were in existence, or granted or required to be granted or otherwise attach pursuant to any agreement in existence, prior to, and were not granted or such agreement was not entered into (as applicable) in contemplation of, such acquisition, merger or consolidation and such liens do not extend to any assets other than accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as so defined) and rights (contractual and other) and collateral related thereto and proceeds of the foregoing and any related deposit accounts containing such proceeds;
 
(j)                                      liens not permitted by the foregoing clauses (a) to (k), inclusive, if at the time of, and after giving effect to, the creation or assumption of any such lien, the aggregate amount (without duplication) of all outstanding Indebtedness of the Company and its Restricted Subsidiaries  secured by all such liens on such Principal Properties and all outstanding Indebtedness of the Company and its Qualifying Subsidiaries secured by all such liens on Accounts Receivable not so permitted by the foregoing clauses (a) through (k), inclusive, together with the Attributable Debt in respect of Sale and Lease-Back Transactions permitted by paragraph (a) under subsection (2) below do not exceed the greater of $1,500,000,000 and 10% of Consolidated Net Worth; and
 
(l)                                      any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part, of any lien referred to in the foregoing clauses (a) to (j), inclusive; provided, however, that the principal amount of Indebtedness secured thereby unless otherwise excepted under clauses (a) through (j) shall not exceed the principal amount of Indebtedness (plus the amount of any unused revolving credit or similar commitments) so secured at the time of such extension, renewal or replacement, and that such extension, renewal or replacement shall be limited to all or a part of the assets (or any replacements therefor) that secured the lien so extended, renewed or replaced (plus improvements and construction on real property).
 
(2)                                   Limitation on Sale/Leaseback Transactions.
 
The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction unless:
 
12

 
(a)                                   the Company or such Restricted Subsidiary, at the time of entering into a Sale and Lease-Back Transaction, would be entitled to incur Indebtedness secured by a lien on the Principal Property to be leased in an amount at least equal to the Attributable Debt in respect of such Sale and Lease-Back Transaction, without equally and ratably securing the Securities pursuant to subsection (1) above; or
 
(b)                                  the direct or indirect proceeds of the sale of the Principal Property to be leased are at least equal to the fair value of such Principal Property (as determined by the Company’s Board of Directors) and an amount equal to the net proceeds from the sale of the property or assets so leased is applied, within 180 days of the effective date of any such Sale and Lease-Back Transaction, to the purchase or acquisition (or, in the case of real property, commencement of the construction) of property or assets or to the retirement (other than at maturity or pursuant to a mandatory sinking fund or mandatory redemption provision) of Securities, or of Funded Indebtedness of the Company or a consolidated Subsidiary ranking on a parity with or senior to the Securities; provided that there shall be credited to the amount of net worth proceeds required to be applied pursuant to this clause (b) an amount equal to the sum of (i) the principal amount of Securities delivered within 180 days of the effective date of such Sale and Lease-Back Transaction to the Trustee for retirement and cancellation and (ii) the principal amount of other Funded Indebtedness voluntarily retired by the Company within such 180-day period, excluding retirements of Securities and other Funded Indebtedness as a result of conversions or pursuant to mandatory sinking fund or mandatory prepayment provisions.
 
(3)                                   Change of Control Triggering Event.
 
(a)                                   Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem the Offered Securities pursuant to Section 1.1(6) hereof or Section 14.01 of the Base Indenture, each Holder will have the right to require that the Company purchase all or a portion, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of such Holder’s Offered Securities pursuant to Section 1.3(3)(b) hereof (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.
 
(b)                                  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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer. Such notice shall describe the transaction or transactions that constitute the Change of Control and shall state:
 
(A)                               that the Change of Control Offer is being made pursuant to this Section 1.3(3) of this First Supplemental Indenture;
 
(B)                                 that the Company is required to offer to purchase all of the outstanding principal amount of Offered Securities, the purchase price and, that on the date specified in such notice, which date shall be no earlier than 30 days
 
13

and no 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 Company shall repurchase the Offered Securities validly tendered and not withdrawn pursuant to this Section 1.3(3);
 
(C)                                 if mailed prior to the date of consummation of the Change of Control, shall state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring on or prior to the Change of Control Payment Date;
 
(D)                                that any Offered Security not tendered or accepted for payment shall continue to accrue interest;
 
(E)                                  that, unless the Company defaults in making such payment, Offered Securities accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date;
 
(F)                                  that Holders electing to have an Offered Security purchased pursuant to a Change of Control Offer may elect to have all or any portion of such Offered Security purchased;
 
(G)                                 that Holders of Offered Securities electing to have Offered Securities purchased pursuant to a Change of Control Offer shall be required to surrender their Offered Securities, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Offered Security, or such other customary documents of surrender and transfer as the Company may reasonably request, duly completed, or transfer the Offered Security by book-entry transfer, to the paying agent at the address specified in the notice prior to the Change of Control Payment Date;
 
(H)                                that Holders shall be entitled to withdraw their election if the Company, the Depositary or the paying agent, as the case may be, receives, not later than the expiration of the Change of Control Offer, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Offered Security the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have such Offered Security purchased;
 
(I)                                     that Holders whose Offered Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered (or transferred by book-entry transfer); and
 
(J)                                    the CUSIP number, if any, printed on the Offered Securities being repurchased and that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Offered Securities.
 
14

 
(c)                                   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 Offered Securities properly tendered and not withdrawn under its offer.
 
(d)                                  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 such laws and regulations are applicable in connection with the repurchase of Offered Securities pursuant to a Change of Control Offer. To the extent that any securities laws or regulations conflict with the provisions of this Section 1.3(3), the Company shall comply with the applicable securities laws and regulations and shall be deemed not to have breached its obligations under this Section 1.3(3) by virtue thereof.
 
Section 1.4                                       Additional Event of Default .
 
The following additional event shall be established and shall constitute an “Event of Default” under Section 6.01(a) of the Base Indenture with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding:
 
(9)                                   an event of default shall happen and be continuing with respect to the Company’s or Parent’s Indebtedness for borrowed money (other than Non-Recourse Indebtedness) under any indenture or other instrument evidencing or under which the Company or Parent shall have a principal amount outstanding (such amount with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities based on the accreted amount determined in accordance with United States generally accepted accounting principles and as of the date of the most recently prepared consolidated balance sheet of the Company or Parent, as the case may be) in excess of $100,000,000, and such event of default shall involve the failure to pay the principal of such Indebtedness on the final maturity date thereof after the expiration of any applicable grace period with respect thereto, or such Indebtedness shall have been accelerated so that the same shall have become due and payable prior to the date on which the same would otherwise have become due and payable, and such acceleration shall not be rescinded or annulled within ten Business Days after notice thereof shall have been given to the Company and Parent by the Trustee, or to the Company, Parent and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities; provided that, if such event of default under such indenture or instrument shall be remedied or cured by the Company or Parent or waived by the requisite holders of such Indebtedness, then the Event of Default hereunder by reason thereof shall be deemed likewise to have been thereupon remedied, cured or waived without further action upon the part of either the Trustee or any of the Securityholders, and provided further, however, that subject to the provisions of Sections 7.01 and 7.02, the Trustee shall not be charged with knowledge of any such event of default unless written notice thereof shall have been given to the Trustee by the Company or Parent, as the case may be, by the holder or an agent of the holder of any such Indebtedness, by the trustee then acting under any indenture or other instrument under which such default shall have occurred, or by the Holders of not less than 25% in the aggregate principal amount of Outstanding Securities.
 
15

 
ARTICLE II
 
MISCELLANEOUS
 
Section 2.1.                                    Definitions .
 
Capitalized terms used but not defined in this First Supplemental Indenture shall have the meanings ascribed thereto in the Base Indenture.
 
Section 2.2.                                    Confirmation of Indenture .
 
The Base Indenture, as supplemented and amended by this First Supplemental Indenture, is in all respects ratified and confirmed, and the Base Indenture, this First Supplemental Indenture and all indentures supplemental thereto shall be read, taken and construed as one and the same instrument.
 
Section 2.3.                                    Concerning the Trustee .
 
In carrying out the Trustee’s responsibilities hereunder, the Trustee shall have all of the rights, protections and immunities which it possesses under the Indenture. The recitals contained herein and in the Offered Securities, except the Trustee’s certificate of authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this First Supplemental Indenture or of the Offered Securities. The Trustee shall not be accountable for the use or application by the Company of the Offered Securities or the proceeds thereof.
 
Section 2.4.                                    Governing Law .
 
This First Supplemental Indenture and the Offered Securities shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State without regard to conflicts of laws principles that would require the application of any other law.
 
Section 2.5.                                    Separability .
 
In case any provision in this First Supplemental Indenture shall for any reason be held to 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 2.6.                                    Counterparts .
 
This First Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
16

 
Section 2.7                                       No Benefit .
 
Nothing in this First Supplemental Indenture, express or implied, shall give to any Person other than the parties hereto and their successors or assigns, and the holders of the Offered Securities, any benefit or legal or equitable rights, remedy or claim under this First Supplemental Indenture or the Base Indenture.
 
17

 
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed all as of the day and year first above written.

 	 	TYCO ELECTRONICS GROUP S.A.	
 	 	 	
 	 	By:	/s/ Mario Calastri	 	
 	 	 	Name:	Mario Calastri	
 	 	 	Title:	Director	

 	 	TYCO ELECTRONICS LTD.	
 	 	 	
 	 	By:	/s/ Terrence R. Curtin	 	
 	 	 	Name:	Terrence R. Curtin	
 	 	 	Title:	Executive Vice President and	
 	 	 	 	Chief Financial Officer	

 	 	DEUTSCHE BANK TRUST COMPANY
AMERICAS	
 	 	as Trustee	
 	 	 	
 	 	By:	/s/ Richard L. Buckwalter	 	
 	 	 	Name:	Richard L. Buckwalter	
 	 	 	Title:	Director	

 	 	By:	/s/ Carol Ng	 	
 	 	 	Name:	Carol Ng	
 	 	 	Title:	Vice President	

 
EXHIBIT A
FORM OF 6.000 % SENIOR NOTES
 
 [Insert the Private Placement Legend and/or the Global Security legend, as applicable]
 
6.000% SENIOR NOTES DUE 2012

No. [      ]	$[               ]	
CUSIP No. [                 ]
 
TYCO ELECTRONICS GROUP S.A.
 
promises to pay to Cede & Co. or registered assigns, the principal sum of [              ] Dollars on [        ].
 
Interest Payment Dates: April 1 and October 1
 
Record Dates:  March 16 and September 15
 
Each holder of this Security (as defined below), by accepting the same, agrees to and shall be bound by the provisions hereof and of the Indenture described herein, and authorizes and directs the Trustee described herein on such holder’s behalf to be bound by such provisions. Each holder of this Security hereby waives all notice of the acceptance of the provisions contained herein and in the Indenture and waives reliance by such holder upon said provisions.
 
This Security shall not be entitled to any benefit under the Indenture, or be valid or become obligatory for any purpose, until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee. The provisions of this Security are continued on the reverse side hereof, and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.
 
IN WITNESS WHEREOF, the Company has caused this instrument to be signed in accordance with Section 2.04 of the Indenture.
 
Date:  [        ]

 	 	TYCO ELECTRONICS GROUP S.A.	

 	 	Name:	
 	 	Title:	
 	 	 	
 	 	[If second signature is applicable:]	

 	 	Name:	
 	 	Title:	
 
A-1

 
CERTIFICATE OF AUTHENTICATION
 
This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 	 	DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Trustee	
 	 	 	
 	 	By:	 	 	
 	 	 	Authorized Signatory	
 	 	 	
 	 	By:	 	 	
 	 	 	Authorized Signatory	

 	 	Dated:	[        ]	

A-2

 
GUARANTEE
 
For value received, TYCO ELECTRONICS LTD. hereby absolutely, unconditionally and irrevocably guarantees to the holder of this Security the payment of principal of, premium, if any, and interest on, the Security upon which this Guarantee is set forth in the amounts and at the time when due and payable whether by declaration thereof or otherwise, and interest on the overdue principal and interest, if any, of such Security, if lawful, to the holder of such Security and the Trustee on behalf of the holders, all in accordance with and subject to the terms and limitations of such Security and Article XV of the Indenture. This Guarantee will not become effective until the Trustee or Authenticating Agent duly executes the certificate of authentication on this Security. This Guarantee shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of law principles thereof.
 
Dated: [        ]

 	 	TYCO ELECTRONICS LTD.	

 	 	By:	 	 	
 	 	 	Name:	
 	 	 	Title:	
 
A-3

 
Tyco Electronics Group S.A.
 
6.000 % Senior Notes due 2012
 
This security is one of a duly authorized series of debt securities of Tyco Electronics Group S.A., a Luxembourg company (the “Company”), issued or to be issued in one or more series under and pursuant to an Indenture for the Company’s unsubordinated debt securities, dated as of September 25, 2007 (the “Base Indenture”), duly executed and delivered by and among the Company, Tyco Electronics Ltd. (“Parent”) and Deutsche Bank Trust Company Americas (the “Trustee”), as supplemented by the First Supplemental Indenture, dated as of September 25, 2007 (the “First Supplemental Indenture”), by and among the Company, Parent and the Trustee. The Base Indenture as supplemented and amended by the First Supplemental Indenture is referred to herein as the “Indenture.”  By the terms of the Base Indenture, the debt securities issuable thereunder are issuable in series that may vary as to amount, date of maturity, rate of interest and in other respects as provided in the Base Indenture. This security is one of the series designated on the face hereof (individually, a “Security,” and collectively, the “Securities”), and reference is hereby made to the Indenture for a description of the rights, limitations of rights, obligations, duties and immunities of the Trustee, the Company, Parent and the holders of the Securities (the “Securityholders”). Capitalized terms used herein and not otherwise defined shall have the meanings given them in the Base Indenture or the First Supplemental Indenture, as applicable.
 
1. Interest .  The Company promises to pay interest on the principal amount of this Security at an annual rate of 6.000%, subject to adjustment as provided below. The Company will pay interest semi-annually on April 1 and October 1 of each year (each such day, an “Interest Payment Date”). If any Interest Payment Date, redemption date or maturity date of this Security is not a Business Day, then payment of interest or principal (and premium, if any) shall be made on the next succeeding Business Day with the same force and effect as if made on the date such payment was due, and no interest shall accrue for the period after such date to the next succeeding Business Day. Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from the date of issuance; provided that, if there is no existing Default in the payment of interest, and if this Security is authenticated between a regular record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; and provided, further, that the first Interest Payment Date shall be [        ]. Interest will be computed on the basis of a 360-day year of twelve 30-day months. In certain circumstances, liquidated damages may be payable as provided in Section 6.01 of the Indenture. Any such liquidated damages shall be payable in the same manner and on the same dates as the stated interest payable on this Security.
 
The interest rate payable on this Security shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to this Security as set forth in Section 1.1(4)(B) of the Indenture.
 
The Holder of this Security is entitled to the benefits of the Exchange and Registration Rights Agreement. Pursuant to the Exchange and Registration Rights Agreement, the Company
 
A-4

 
has agreed (i) to file the Exchange Registration Statement (as defined in the Exchange and Registration Rights Agreement) as soon as practicable, but no later than 210 days after the Closing Date (as defined in the Exchange and Registration Rights Agreement), (ii) to use its commercially reasonable efforts to cause such Exchange Registration Statement to become effective under the Securities Act as soon as practicable, but no later than 300 days after the Closing Date, and (iii) to use its commercially reasonable efforts to commence and complete the Exchange Offer (as defined in the Exchange and Registration Rights Agreement) promptly, but no later than 45 days after such registration statement has become effective, hold the Exchange Offer open for at least 30 days and exchange Exchange Securities (as defined in the Exchange and Registration Rights Agreement) for all Registrable Securities (as defined in the Exchange and Registration Rights Agreement) that have been properly tendered and not withdrawn on or prior to the expiration of the Exchange Offer. If (i) on or prior to the time the Exchange Offer is completed existing SEC interpretations are changed such that debt securities or the related guarantee received by holders other than Restricted Holders (as defined in the Exchange and Registration Rights Agreement) in the Exchange Offer for Registrable Securities (as defined in the Exchange and Registration Rights Agreement) are not or would not be, upon receipt, transferable by each such holder without restriction under the Securities Act, (ii) the Exchange Offer is not completed within 345 days after the Closing Date or (iii) the Exchange Offer is not available to any Holder, then, in each case, the Company is required to (a) as soon as practicable but no later than 60 days after the time such obligation to file arises, file a Shelf Registration Statement (as defined in the Exchange and Registration Rights Agreement) and (b) use its commercially reasonable best efforts to cause the Shelf Registration Statement to become or be declared effective within 120 days after such Shelf Registration Statement is filed and to keep such Shelf Registration Statement continuously effective until the earlier of two years after the date as of which the Shelf Registration Statement became or was declared effective or such time as there are no longer any Registrable Securities outstanding. If (i) the Company fails to file the Exchange Registration Statement or the Shelf Registration Statement on or before the date specified for such filing, (ii) any of the Exchange Registration Statement or the Shelf Registration Statement is not declared effective by the date specified for such effectiveness, (iii) the Company fails to complete the Exchange Offer within 45 after the effectiveness target date with respect to the Exchange Registration Statement, (iv) any of the Exchange Registration Statement or the Shelf Registration Statement is declared effective but thereafter is withdrawn or ceases to be effective due to a stop order issued pursuant to the Securities Act suspending the effectiveness of such registration statement without being succeeded by an additional registration statement filed and declared effective or (v) the Company requires Holders to refrain from disposing of their Registrable Securities under certain circumstances described in the Exchange and Registration Rights Agreement and that suspension period exceeds 45 days in any one instance or 90 days in the aggregate during any consecutive 12 month period (each such event referred to in clauses (i) through (v), a “Registration Default” and each period during which a Registration Default has occurred and is continuing, a “Registration Default Period”), then, as liquidated damages for such Registration Default, subject to certain exceptions, special interest (“Special Interest”) shall accrue at a per annum rate of 0.25% for the first 90 days of the Registration Default Period and at a per annum rate of 0.50% thereafter for the remaining portion of the Registration Default Period.
 
2.   Method of Payment .  The Company will pay interest on the Securities (except defaulted interest), if any, to the persons in whose name such Securities are registered at the
 
A-5

 
close of business on the regular record date referred to on the facing page of this Security for such interest installment. In the event that the Securities or a portion thereof are called for redemption and the Redemption Date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Securities will be paid upon presentation and surrender of such Securities as provided in the Indenture. The principal of and the interest on the Securities shall be payable in the coin or currency of the United States of America that at the time is legal tender for public and private debt, at the office or agency of the Company maintained for that purpose in accordance with the Indenture.
 
3.   Paying Agent and Registrar .  Initially, Deutsche Bank Trust Company Americas, the Trustee, will act as paying agent and Security Registrar. The Company may change or appoint any paying agent or Security Registrar without notice to any Securityholder. Parent, the Company or any of their Subsidiaries may act in any such capacity.
 
4.   Indenture .  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (“TIA”) as in effect on the date the Indenture is qualified. The Securities are subject to all such terms, and Securityholders are referred to the Indenture and TIA for a statement of such terms. The Securities are unsecured general obligations of the Company and constitute the series designated on the face hereof as the “6.000% Senior Notes due 2012”, initially limited to $800,000,000 in aggregate principal amount. The Company will furnish to any Securityholder upon written request and without charge a copy of the Base Indenture and the First Supplemental Indenture. Requests may be made to: Tyco Electronics Group S.A., 17, boulevard Grande-Duchesse Charlotte, L-1331 Luxembourg, Attention: The Managing Directors.
 
5.   Optional Redemption .  The Securities will be subject to redemption at the option of the Company on any date prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), on written notice given to the Securityholders thereof not less than 30 days nor more than 90 days prior to the date fixed for redemption in such notice (the “Redemption Date”), at a redemption price equal to the greater of (i) 100% of the principal amount of such Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of  interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 25 basis points (such greater amount is referred to herein as the “Redemption Price”), plus, in either the case of clause (i) or clause (ii), accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date. This Security is also subject to redemption to the extent provided in Article XIV of the Indenture.
 
If the giving of the notice of redemption is completed as provided in the Indenture, interest on such Securities or portions of Securities shall cease to accrue on and after the Redemption Date, unless the Company shall default in the payment of such Redemption Price and accrued interest with respect to any such Security or portion thereof.
 
A-6

 
The Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Securities.
 
6.   Change of Control Triggering Event . Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem this Security, the holder of this Security will have the right to require that the Company purchase all or a portion, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of this Security at a purchase price equal to 101% of the principal amount hereof plus accrued and unpaid interest, if any, to the date of purchase. 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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer.
 
7.   Denominations, Transfer, Exchange .  The Securities are in registered form without coupons in the denominations of $2,000 or any integral multiple of $1,000 in excess thereof. The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture. The Securities may be presented for exchange or for registration of transfer (duly endorsed or with the form of transfer endorsed thereon duly executed if so required by the Company or the Security Registrar) at the office of the Security Registrar or at the office of any transfer agent designated by the Company for such purpose. No service charge will be made for any registration of transfer or exchange, but a Securityholder may be required to pay any applicable taxes or other governmental charges. If the Securities are to be redeemed, the Company will not be required to:  (i) issue, register the transfer of, or exchange any Security during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of less than all of the outstanding Securities of the same series and ending at the close of business on the day of such mailing; (ii) register the transfer of or exchange any Security of any series or portions thereof selected for redemption, in whole or in part, except the unredeemed portion of any such Security being redeemed in part; nor (iii) register the transfer of or exchange a Security of any series between the applicable record date and the next succeeding Interest Payment Date.
 
8.   Persons Deemed Owners .  The registered Securityholder may be treated as its owner for all purposes.
 
9. Repayment to Parent or the Company . Any funds or Governmental Obligations deposited with any paying agent or the Trustee, or then held by Parent or the Company, in trust for payment of principal of, premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least one year after the date upon which the principal of, premium, if any, or interest on such Securities shall have respectively become due and payable, shall be repaid to Parent or the Company, as applicable, or (if then held by Parent or the Company) shall be discharged from such trust. After return to the Company or Parent, Holders entitled to the money or securities must look to the Company or Parent, as applicable, for payment as unsecured general creditors.
 
10.   Amendments, Supplements and Waivers .  The Base Indenture contains provisions permitting the Company, Parent and the Trustee, with the consent of the holders of not less than
 
A-7

 
a majority in aggregate principal amount of the Outstanding Securities  to enter into supplemental indentures for the purpose of adding, changing or eliminating any provisions to the Base Indenture or supplemental indenture or indentures or of modifying in any manner not covered elsewhere in the Base Indenture the rights of the holders of the Securities of such series; provided , however , that no such supplemental indenture, without the consent of the holders of each Security then Outstanding and affected thereby, shall:  (i) extend a fixed maturity of or any installment of principal of any Securities of any series or reduce the principal amount thereof, or reduce the amount of principal of any original issue discount security that would be due and payable upon declaration of acceleration of the maturity thereof; (ii) reduce the rate of or extend the time for payment of interest of any Security of any series; (iii) reduce the premium payable upon the redemption of any Security; (iv) make any Security payable in Currency other than that stated in the Security; (v) impair the right to institute suit for the enforcement of any payment on or after the fixed maturity thereof (or in the case or redemption, on or after the redemption date); or (vi) reduce the percentage of Securities, the holders of which are required to consent to any such supplemental indenture or indentures. The Base Indenture also contains provisions permitting the holders of not less than a majority in aggregate principal amount of the Outstanding securities of each series affected thereby, on behalf of all of the holders of the securities of such series, to waive any past Default under the Base Indenture, and its consequences, except a Default in the payment of the principal of, premium, if any, or interest on any security of such series or a Default in respect of a covenant or provision of the Base Indenture that cannot be modified or amended without the consent of the holder of each Outstanding security of such affected series. Any such consent or waiver by the registered Securityholder shall be conclusive and binding upon such holder and upon all future holders and owners of this Security and of any Security issued in exchange for this Security or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Security.
 
11.   Defaults and Remedies .  If an Event of Default with respect to the securities of a series issued pursuant to the Base Indenture occurs and is continuing, the Trustee or the holders of at least 25% in aggregate principal amount of the Securities of such series then Outstanding, by notice in writing to the Company and Parent (and to the Trustee if notice is given by such holders), may declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately. Subject to the terms of the Indenture, if an Event of Default under the Indenture shall occur and be continuing, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the holders, unless such holders have offered the Trustee indemnity satisfactory to it. Upon satisfaction of certain conditions set forth in the Indenture, the holders of a majority in principal amount of the Outstanding securities of a series issued pursuant to the Base Indenture will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the securities of such series.
 
12. Trustee, Paying Agent and Security Registrar May Hold Securities . The Trustee, subject to certain limitations imposed by the TIA, or any paying agent or Security Registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, paying agent or Security Registrar.
 
A-8

 
13.   No Recourse Against Others .  No recourse under or upon any obligation, covenant or agreement of the Indenture, or of any Security, or for any claim based thereon or otherwise in respect hereof or thereof, shall be had against any incorporator, stockholder, officer or director, past, present or future as such, of Parent or the Company or of any predecessor or successor corporation, either directly or through Parent or the Company or any such predecessor or 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 the Indenture and the obligations issued hereunder and thereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, shareholders, officers or directors as such, of Parent or the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, shareholder, officer or director as such, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the acceptance of the Securities.
 
14.   Discharge of Indenture .  The Indenture contains certain provisions pertaining to defeasance, which provisions shall for all purposes have the same effect as if set forth herein.
 
15.  Authentication .  This Security shall not be valid until the Trustee signs the certificate of authentication attached to the other side of this Security.
 
16. Guarantees . All payments by the Company under the Indenture and this Security are fully and unconditionally guaranteed to the holder of this Security by Parent, as provided in the related Guarantee and the Indenture.
 
17. Additional Amounts . The Company and Parent are obligated to pay Additional Amounts on this Security to the extent provided in Article XIV of the Indenture.
 
18.   Abbreviations .  Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
 
19.   Governing Law .  The Base Indenture, the First Supplemental Indenture and this Security (and the Guarantee hereon) shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State.
 
A-9

ASSIGNMENT FORM
 
To assign this Security, fill in the form below: (I) or (we) assign and transfer this Security to

(Insert assignee’s soc. sec. or tax I.D. no.)

 

 

(Print or type assignee’s name, address and zip code)
and irrevocably appoint                                                                                                                                                                      agent to transfer this Security on the books of the Company. The agent may substitute another to act for him.

 

Date:	 	 	 	 	
 	 	 	
 	 	Your Signature:	 	 	
 	 	(Sign exactly as your name appears on the face of this
Security)	

Signature Guarantee:	 	 	 	 	

A-10

 
OPTION OF HOLDER TO ELECT PURCHASE
 
If you want to elect to have this Security purchased by the Company pursuant to Section 1.3(3) of the First Supplemental Indenture, check the box:
 
o   1.3(3) Change of Control Triggering Event
 
If you want to elect to have only part of this Security purchased by the Company pursuant to Section 1.3(3) of the First Supplemental Indenture, state the amount:  $                   .

Date:	 	 	 	Your Signature:	
 	 	(Sign exactly as your name appears	
 	 	on the other side of the Security)	

 	 	Tax I.D. number	
 	 	 	
Signature Guarantee:	 	 	 	 	
 	(Signature must be guaranteed by a	 	 	
 	participant in a recognized signature	 	 	
 	guarantee medallion program)	 	 	

 

EXHIBIT 4.1(c)

TYCO ELECTRONICS GROUP S.A.,
as Issuer
 
AND
 
TYCO ELECTRONICS LTD.,
as Guarantor
 
AND
 
DEUTSCHE BANK TRUST
COMPANY AMERICAS,
as Trustee

SECOND SUPPLEMENTAL INDENTURE
Dated as of September 25, 2007

$750,000,000 of 6.550% Senior Notes due 2017

 

 
THIS SECOND SUPPLEMENTAL INDENTURE is dated as of September 25, 2007 among TYCO ELECTRONICS GROUP S.A., a Luxembourg company (the “ Company ”), TYCO ELECTRONICS LTD., a Bermuda company (“ Parent ”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation (the “ Trustee ”).
 
RECITALS
 
A.             Parent, the Company and the Trustee executed and delivered an Indenture, dated as of September 25, 2007, (the “ Base Indenture ”), to provide for the issuance by the Company from time to time of unsubordinated debt securities evidencing its unsecured indebtedness.
 
B.             Pursuant to Board Resolution, the Company has authorized the issuance of the $750,000,000 principal amount of 6.550% Senior Notes due 2017 (the “ Offered Securities ”).
 
C.             The entry into this Second Supplemental Indenture by the parties hereto is in all respects authorized by the provisions of the Base Indenture.
 
D.             Parent and the Company desire to enter into this Second Supplemental Indenture pursuant to Section 9.01 of the Base Indenture to establish the terms of the Offered Securities in accordance with Section 2.01 of the Base Indenture and to establish the form of the Offered Securities in accordance with Section 2.02 of the Base Indenture.
 
E.              All things necessary to make this Second Supplemental Indenture a valid indenture and agreement according to its terms have been done.
 
NOW, THEREFORE, for and in consideration of the foregoing premises, Parent, the Company and the Trustee mutually covenant and agree for the equal and proportionate benefit of the respective holders from time to time of the Offered Securities as follows:
 
ARTICLE I
 
Section 1.1.             Terms of Offered Securities .
 
The following terms relate to the Offered Securities:
 
(1)            The Offered Securities constitute a series of securities having the title “6.550% Senior Notes due 2017”.
 
(2)            The initial aggregate principal amount of the Offered Securities that may be authenticated and delivered under the Base Indenture (except for Offered Securities authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of, other Offered Securities pursuant to Section 2.05, 2.06, 2.07, 2.11, or 3.03) is $750,000,000.
 
(3)            The entire Outstanding principal of the Offered Securities shall be payable on October 1, 2017.

 
(4)            (A)           The rate at which the Offered Securities shall bear interest initially shall be 6.550% per year (the “ Original Interest Rate ”) plus Special Interest, if any, payable pursuant to the Exchange and Registration Rights Agreement and as set forth in the Offered Securities, and shall be subject to adjustments as provided in Section 1.1(4)(B). The date from which interest shall accrue on the Offered Securities shall be September 25, 2007, or the most recent Interest Payment Date to which interest has been paid or provided for. The Interest Payment Dates for the Offered Securities shall be April 1 and October 1 of each year, beginning April 1, 2008. Interest shall be payable on each Interest Payment Date to the holders of record at the close of business on the March 16 and September 15 prior to each Interest Payment Date (a “ regular record date ”). The basis upon which interest shall be calculated shall be that of a 360-day year consisting of twelve 30-day months.
 
(B)            The interest rate payable on the Offered Securities shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to the Offered Securities as set forth in this Section 1.1(4)(B). If the rating from Moody’s, S&P or Fitch of the Offered Securities is decreased to a rating set forth in the immediately following table, the interest rate on the Offered Securities shall increase from the Original Interest Rate by adding the percentage set forth opposite the rating applicable to the lowest two rating levels assigned to such Offered Securities by any of Moody’s, S&P and Fitch:

Rating Agency	 	
Moody’s	 	S&P	 	Fitch	 	Percentage	 	
Ba1	 	BB+	 	BB+	 	0.25	%	
Ba2	 	BB	 	BB	 	0.50	%	
Ba3	 	BB-	 	BB-	 	0.75	%	
B1 or below	 	B or below	 	B or below	 	1.00	%	
 
If at any time the interest rate on the Offered Securities has been adjusted upward and Moody’s, S&P or Fitch, as the case may be, subsequently increases its rating of the Offered Securities to any of the threshold ratings set forth above, the interest rate on the Offered Securities shall be decreased such that the interest rate for the Offered Securities equals the Original Interest Rate plus the percentages set forth opposite the ratings from the tables above in effect immediately following the increase applicable to the two lowest rating levels assigned to such Offered Securities by any of Moody’s, S&P or Fitch. If Moody’s subsequently increases its rating of the Offered Securities to Baa3 or higher, S&P increases its rating to BBB- or higher and Fitch increases its rating to BBB- or higher, the interest rate on the Offered Securities will be decreased to the Original Interest Rate.
 
Each adjustment required by any decrease or increase in a rating set forth above, whether occasioned by the action of Moody’s, S&P or Fitch, shall be made independent of any and all other adjustments; provided that in determining any adjustment, the percentage applicable to the lowest two rating levels assigned to the Offered Securities by any of Moody’s, S&P and Fitch shall be used. In no event shall (1) the interest rate for the Offered Securities be reduced to below the Original Interest Rate or (2) the total increase in the interest rate on the Offered Securities exceed 2.00% above the Original Interest Rate.
 
3

 
If any two of Moody’s, S&P or Fitch cease to provide a rating of the Offered Securities, any subsequent increase or decrease in the interest rate of the Offered Securities necessitated by a reduction or increase in the rating by the agency continuing to provide the rating shall be twice the percentage set forth in the applicable table above. No adjustments in the interest rate of the Offered Securities shall be made solely as a result of Moody’s, S&P or Fitch ceasing to provide a rating. If Moody’s, S&P and Fitch all cease to provide a rating of the Offered Securities, the interest rate on the Offered Securities shall increase to, or remain at, as the case may be, 2.00% above the Original Interest Rate. References to Moody’s, S&P and Fitch in this Section 1.1(4)(B) shall be deemed to include any successors to Moody’s, S&P and Fitch.
 
Any interest rate increase or decrease described above will take effect from the first day of the interest period during which a rating change requires an adjustment in the interest rate.
 
The interest rate on the Offered Security will permanently cease to be subject to any adjustments described in this Section 1.1(4)(B) (notwithstanding any subsequent decrease in the ratings by any or all of Moody’s, S&P or Fitch or any or all of Moody’s, S&P or Fitch ceasing to provide ratings) and shall be set at the Original Interest Rate if the Offered Securities become rated A3, A- or A- or higher by any two of Moody’s, S&P and Fitch, respectively (or one of these ratings if only rated by one of Moody’s, S&P and Fitch), with a stable or positive outlook by both such rating agencies.
 
(5)            The Offered Securities shall be issuable in whole in the form of one or more registered Restricted Global Securities, and the Depository for such Restricted Global Securities shall be The Depository Trust Company, New York, New York. The Offered Securities shall be substantially in the form attached hereto as Exhibit A the terms of which are herein incorporated by reference. The Offered Securities shall be issuable in denominations of $2,000 or any integral multiple of $1,000 in excess thereof.
 
(6)            (A)           The Offered Securities will be subject to redemption at the option of the Company on any date (a “ Redemption Date ”) prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), at a redemption price equal to the greater of (i) 100% of the principal amount of the Offered Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 30 basis points (such greater amount is referred to herein as the “ Redemption Price ”), plus accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date.
 
(B)            As used herein:
 
“ Adjusted Redemption Treasury Rate ”, with respect to any Redemption Date, means the  rate equal to the semiannual equivalent yield to maturity or interpolated (on a 30/360 day count basis) yield to maturity of the Comparable Redemption Treasury Issue, assuming a
 
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price for the Comparable Redemption Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Redemption Treasury Price for such Redemption Date.
 
“ Comparable Redemption Treasury Issue ” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Offered Securities to be redeemed that will be utilized 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 Offered Securities.
 
“ Comparable Redemption Treasury Price ”, with respect to any Redemption Date, means (i) the average of the Redemption Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Redemption Reference Treasury Dealer Quotations (unless there is more than one highest or lowest quotation, in which case only one such highest and/or lowest quotation shall be excluded), or (ii) if the Quotation Agent obtains fewer than four such Redemption Reference Treasury Dealer Quotations, the average of all such Redemption Reference Treasury Dealer Quotations.
 
“ Quotation Agent ” means a Redemption Reference Treasury Dealer appointed as such agent by the Company.
 
“ Redemption Reference Treasury Dealer ” means four primary U.S. Government securities dealers in the United States selected by the Company.
 
“ Redemption Reference Treasury Dealer Quotations ”, with respect to each Redemption Reference Treasury Dealer and any Redemption Date, means the average, as determined by the Quotation Agent, of the bid and offer prices at 11:00 a.m. New York City time for the Comparable Redemption Treasury Issue (expressed in each case as a percentage of its principal amount) for settlement on the Redemption Date quoted in writing to the Quotation Agent by such Redemption Reference Treasury Dealer on the third Business Day preceding such Redemption Date.
 
(7)            The Offered Securities will not have the benefit of any sinking fund.
 
(8)            Except as provided herein, the holders of the Offered Securities shall have no special rights in addition to those provided in the Base Indenture upon the occurrence of any particular events.
 
(9)            The Offered Securities will be general unsecured and unsubordinated obligations of the Company and will be ranked equally among themselves.
 
(10)          The Offered Securities are not convertible into shares of common stock or other securities of the Company.
 
(11)          The additional Event of Default and restrictive covenants set forth in Sections 1.3 and 1.4 shall be applicable to the Offered Securities.
 
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Section 1.2              Additional Defined Terms .
 
As used herein, the following defined terms shall have the following meanings with respect to the Offered Securities only:
 
“ Accounts Receivable ” of any Person means the accounts receivable of such Person generated by the sale of inventory to third-party customers in the ordinary course of business.
 
“ Attributable Debt ”, in connection with a Sale and Lease-Back Transaction, as of any particular time, means the aggregate of present values (discounted at a rate that, at the inception of the lease, represents the effective interest rate that the lessee would have incurred to borrow over a similar term the funds necessary to purchase the leased assets) of the obligations of the Company or any Restricted Subsidiary for net rental payments during the remaining term of the applicable lease, including any period for which such lease has been extended or, at the option of the lessor, may be extended. The term “net rental payments” under any lease of any period shall mean the sum of the rental and other payments required to be paid in such period by the lessee thereunder, not including any amounts required to be paid by such lessee, whether or not designated as rental or additional rental, on account of maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges required to be paid by such lessee thereunder or any amounts required to be paid by such lessee thereunder contingent upon the amount of sales, maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges.
 
“ Below Investment Grade Rating Event ” means the Offered Securities are rated below an Investment Grade Rating by at least two of the Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of the Change of Control (which 60-day period shall be extended so long as the rating of the Offered Securities is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall be deemed not to have occurred in respect of a particular Change of Control (and thus shall be deemed not to be a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the rating agencies making the reduction in rating to which this definition would otherwise apply do not publicly announce or publicly confirm or inform the Trustee in writing at its request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
 
“ Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
 
“ Change of Control ” means the occurrence of any of (1) the direct or indirect sale, 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 Parent and its subsidiaries taken as a whole to any person or group of persons for purposes of Section 13(d) of the Exchange Act other than Parent or one of its subsidiaries or a person controlled by Parent or
 
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one of its subsidiaries; (2) consummation of any transaction (including any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than Parent’s or its subsidiaries’ employee benefit plans, becomes the beneficial owner (as defined in Rules 13(d)(3) and 13(d)(5) under the Exchange Act), directly or indirectly, of more than 50% of the outstanding voting stock of Parent, measured by voting power rather than number of shares; or (3) the replacement of a majority of the board of directors of Parent over a two-year period from the directors who constituted the board of directors of Parent at the beginning of such period, and such replacement shall not have been approved by at least a majority of the board of directors of Parent then still in office (either by a specific vote or by approval of a proxy statement in which such member was named as a nominee for election as a director, without objection to such nomination) who either were members of such board of directors at the beginning of such period or whose election as a member of such board of directors was previously so approved; provided, that, a transaction effected to create a holding company for Parent will not be deemed to involve a Change of Control if: (1) pursuant to such transaction Parent becomes a direct or indirect wholly-owned subsidiary of such 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 Parent’s voting stock immediately prior to that transaction. Following any such transaction, references in this definition to Parent shall be deemed to refer to such holding company. For purposes of this definition, “voting stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) 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.
 
“ Consolidated Net Worth ” at any date means total assets less total liabilities, in each case appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet.
 
“ Consolidated Tangible Assets ” at any date means total assets less all intangible assets appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet. “Intangible assets” means the amount (if any) stated under the heading “Goodwill and Other Intangible assets, net” or under any other heading of intangible assets separately listed, in each case on the face of such consolidated balance sheet.
 
“ Exchange and Registration Rights Agreement ” means the Exchange and Registration Rights Agreement, dated as of September 25, 2007, between the Company, Parent and the other parties named on the signature pages thereof, relating to the Offered Securities, as such agreement may be amended or supplemented from time to time and, with respect to any debt securities (other than the Offered Securities) issued under this Indenture as part of the same series as the Offered Securities, one or more registration rights agreements among the Company, Parent and the other parties thereto, as such agreement(s) may be amended or supplemented from time to time, relating to rights given by the Company and Parent to the purchasers of such additional debt securities to register such additional debt securities under the Securities Act.
 
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“ Fitch ” means Fitch Ratings Ltd.
 
“ Funded Indebtedness ” means any Indebtedness maturing by its terms more than one year from the date of the determination thereof, including any Indebtedness renewable or extendible at the option of the obligor to a date later than one year from the date of the determination thereof.
 
“ Indebtedness ” means, without duplication, the principal amount (such amount being the face amount or, with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities, determined based on the accreted amount as of the date of the most recently prepared consolidated balance sheet of Parent and its Subsidiaries as of the end of a fiscal quarter of Parent prepared in accordance with United States generally accepted accounting principles as in effect on the date of such consolidated balance sheet) of (i) all obligations for borrowed money, (ii) all obligations evidenced by debentures, notes or other similar instruments, (iii) all obligations in respect of letters of credit or bankers acceptances or similar instruments or reimbursement obligations with respect thereto (such instruments to constitute Indebtedness only to the extent that the outstanding reimbursement obligations in respect thereof are collateralized by cash or cash equivalents reflected as assets on a balance sheet prepared in accordance with United States generally accepted accounting principles), (iv) all obligations to pay the deferred purchase price of property or services, except (A) trade and similar accounts payable and accrued expenses, (B) employee compensation, deferred compensation and pension obligations, and other obligations arising from employee benefit programs and agreements or other similar employment arrangements, (C) obligations in respect of customer advances received and (D) obligations in connection with earnout and holdback agreements, in each case in the ordinary course of business, (v) all obligations as lessee to the extent capitalized in accordance with United States generally accepted accounting principles and (vi) all Indebtedness of others consolidated in such balance sheet that is guaranteed by the Company or any of its Subsidiaries or for which the Company or any of its Subsidiaries is legally responsible or liable (whether by agreement to purchase indebtedness of, or to supply funds or to invest in, others).
 
“ Investment Grade Rating ” means a rating equal to or higher than BBB- (or the equivalent) by Fitch, Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P.
 
“ Moody’s ” means Moody’s Investor Services Inc.
 
“ Non-Recourse Indebtedness ” means Indebtedness upon the enforcement of which recourse may be had by the holder(s) thereof only to identified assets of Parent or the Company or any Subsidiary of Parent or the Company and not to Parent or the Company or any Subsidiary of Parent or the Company personally (subject to, for the avoidance of doubt, customary exceptions contained in non-recourse financings to the non-recourse nature of the obligations thereunder).
 
“ Principal Property ” means any U.S. manufacturing, processing or assembly plant or any U.S. warehouse or distribution facility of the Parent or any of its Subsidiaries that is used by any U.S. Subsidiary of the Company and (A) is owned by the Parent or any Subsidiary of the Parent on the date hereof, (B) the initial construction of which has been completed after the date
 
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hereof, or (C) is acquired after the date hereof, in each case, other than any such plants, facilities, warehouses or portions thereof, that in the opinion of the Board of Directors of the Company, are not collectively of material importance to the total business conducted by the Parent and its subsidiaries as an entirety, or that has a net book value (excluding any capitalized interest expense), on the date hereof in the case of clause (A) of this definition, on the date of completion of the initial construction in the case of clause (B) of this definition or on the date of acquisition in the case of clause (C) of this definition, of less than the greater of $50,000,000 and 0.50% of Consolidated Tangible Assets on the consolidated balance sheet of Parent and its subsidiaries as of the applicable date.
 
“ Qualifying Subsidiary ” means a U.S. Subsidiary, the total Accounts Receivable of which exceeds the greater of $2.5 million and 0.20% of the amount stated under the heading “Accounts receivable, net of allowance for doubtful accounts,” or its equivalent, appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles.
 
“ Rating Agencies ” means (1) each of Fitch, Moody’s and S&P; and (2) if any of Fitch, Moody’s or S&P ceases to rate the Offered Securities or fails to make a rating of the Offered Securities publicly available for reasons outside of the Company’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 certified by a resolution of the Company’s Board of Directors) as a replacement agency for Fitch, Moody’s or S&P, or all of them, as the case may be .
 
“ Restricted Subsidiary ” means any Subsidiary of the Company that owns or leases a Principal Property.
 
“ Sale and Lease-Back Transaction ” means an arrangement with any Person providing for the leasing by the Company or a Restricted Subsidiary of any Principal Property whereby such Principal Property has been or is to be sold or transferred by the Company or a Restricted Subsidiary to such Person other than Parent, the Company or any of their respective Subsidiaries; provided, however, that the foregoing shall not apply to any such arrangement involving a lease for a term, including renewal rights, for not more than three years.
 
“ S&P ” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.
 
“ Special Interest ” means all additional interest then owing pursuant to the Exchange and Registration Rights Agreement.
 
“ U.S. Subsidiary ” means any Subsidiary organized under the laws of a jurisdiction of the United States or any political subdivision thereof.
 
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Section 1.3.             Additional Covenants .
 
The following additional covenants shall apply with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding (but subject to defeasance, as provided in the Indenture):
 
(1)            Limitation on Liens.
 
The Company will not, and will not permit any Restricted Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a mortgage, pledge, security interest, lien or encumbrance (each a “ lien ”) upon any property that at the time of such issuance, assumption or guarantee constitutes a Principal Property, and the Company will not, and will not permit any U.S. Subsidiary that at the time of such issuance, assumption or guarantee is a Qualifying Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a lien upon such Qualifying Subsidiary’s Accounts Receivables, or any shares of stock of or Indebtedness issued by any such Restricted Subsidiary or such Qualifying Subsidiary, whether now owned or hereafter acquired, in each case without effectively providing that, for so long as such lien shall continue in existence with respect to such secured Indebtedness, the Offered Securities (together with, if the Company shall so determine, any other Indebtedness of the Company ranking equally with the Offered Securities, it being understood that for purposes hereof, Indebtedness which is secured by a lien and Indebtedness which is not so secured shall not, solely by reason of such lien, be deemed to be of different ranking) shall be equally and ratably secured by a lien ranking ratably with or equal to (or at the Company’s option prior to) such secured Indebtedness; provided, however, that the foregoing covenant shall not apply to:
 
(a)            liens existing on the date the Offered Securities are first issued;
 
(b)            liens on the stock, assets or Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary, unless created in contemplation of such Person becoming a Restricted Subsidiary;
 
(c)            liens on any assets or Indebtedness of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or a Restricted Subsidiary or at the time of a purchase, lease or other acquisition of the assets of a corporation or firm as an entirety or substantially as an entirety by the Company or any Restricted Subsidiary;
 
(d)            liens on any Principal Property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary, or liens to secure the payment of the purchase price of such Principal Property by the Company or any Restricted Subsidiary, or to secure any Indebtedness incurred, assumed or guaranteed by the Company or a Restricted Subsidiary for the purpose of financing all or any part of the purchase price of such Principal Property or improvements or construction thereon, which Indebtedness is incurred, assumed or guaranteed prior to, at the time of or within one year after such acquisition (or in the case of real property, completion of such improvement or construction or commencement of full operation of such property, whichever is later); provided, however, that in the case of any such acquisition, construction or improvement,
 
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the lien shall not apply to any Principal Property theretofore owned by the Company or a Restricted Subsidiary, other than the Principal Property so acquired, constructed or improved (and accessions thereto and improvements and replacements thereof and the proceeds of the foregoing);
 
(e)            liens securing Indebtedness owing by any subsidiary to the Company, Parent or a subsidiary thereof or by the Company to Parent;
 
(f)             liens in favor of the United States or any State thereof, or any department, agency or instrumentality or political subdivision of the United States of America or any State thereof, or in favor of any other country or any political subdivision thereof, to secure partial, progress, advance or other payments pursuant to any contract, statute, rule or regulation or to secure any Indebtedness incurred or guaranteed for the purpose of financing all or any part of the purchase price (or, in the case of real property, the cost of construction or improvement) of the Principal Property or assets subject to such liens (including liens incurred in connection with pollution control, industrial revenue or similar financings);
 
(g)            pledges, liens or deposits under workers’ compensation or similar legislation, and liens thereunder that are not currently dischargeable, or in connection with bids, tenders, contracts (other than for the payment of money) or leases to which the Company or any subsidiary is a party, or to secure the public or statutory obligations of the Company or any subsidiary, or in connection with obtaining or maintaining self-insurance, or to obtain the benefits of any law, regulation or arrangement pertaining to unemployment insurance, old age pensions, social security or similar matters, or to secure surety, performance, appeal or customs bonds to which the Company or any subsidiary is a party, or in litigation or other proceedings in connection with the matters heretofore referred to in this clause, such as interpleader proceedings, and other similar pledges, liens or deposits made or incurred in the ordinary course of business;
 
(h)            liens created by or resulting from any litigation or other proceeding that is being contested in good faith by appropriate proceedings, including liens arising out of judgments or awards against the Company or any subsidiary with respect to which the Company or such subsidiary in good faith is prosecuting an appeal or proceedings for review or for which the time to make an appeal has not yet expired; or final unappealable judgment liens which are satisfied within 15 days of the date of judgment; or liens incurred by the Company or any subsidiary for the purpose of obtaining a stay or discharge in the course of any litigation or other proceeding to which the Company or such subsidiary is a party;
 
(i)             liens for taxes or assessments or governmental charges or levies not yet due or delinquent; or that can thereafter be paid without penalty, or that are being contested in good faith by appropriate proceedings; landlord’s liens on property held under lease; and any other liens or charges incidental to the conduct of the business of the Company or any subsidiary, or the ownership of their respective assets, that were not incurred in connection with the borrowing of money or the obtaining of advances or credit and that, in the opinion of the Board of Directors of the Company, do not
 
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materially impair the use of such assets in the operation of the business of the Company or such subsidiary or the value of such Principal Property or assets for the purposes of such business;
 
(j)             liens to secure the Company’s or any subsidiary’s obligations under agreements with respect to spot, forward, future and option transactions, entered into in the ordinary course of business;
 
(k)            liens on (including securitization programs with respect to) accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as defined in the Uniform Commercial Code of the State of New York) (i) existing at the time of acquisition thereof by the Company or any U.S. Subsidiary or (ii) of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or any U.S. Subsidiary; provided that such liens were in existence, or granted or required to be granted or otherwise attach pursuant to any agreement in existence, prior to, and were not granted or such agreement was not entered into (as applicable) in contemplation of, such acquisition, merger or consolidation and such liens do not extend to any assets other than accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as so defined) and rights (contractual and other) and collateral related thereto and proceeds of the foregoing and any related deposit accounts containing such proceeds;
 
(j)             liens not permitted by the foregoing clauses (a) to (k), inclusive, if at the time of, and after giving effect to, the creation or assumption of any such lien, the aggregate amount (without duplication) of all outstanding Indebtedness of the Company and its Restricted Subsidiaries  secured by all such liens on such Principal Properties and all outstanding Indebtedness of the Company and its Qualifying Subsidiaries secured by all such liens on Accounts Receivable not so permitted by the foregoing clauses (a) through (k), inclusive, together with the Attributable Debt in respect of Sale and Lease-Back Transactions permitted by paragraph (a) under subsection (2) below do not exceed the greater of $1,500,000,000 and 10% of Consolidated Net Worth; and
 
(l)             any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part, of any lien referred to in the foregoing clauses (a) to (j), inclusive; provided, however, that the principal amount of Indebtedness secured thereby unless otherwise excepted under clauses (a) through (j) shall not exceed the principal amount of Indebtedness (plus the amount of any unused revolving credit or similar commitments) so secured at the time of such extension, renewal or replacement, and that such extension, renewal or replacement shall be limited to all or a part of the assets (or any replacements therefor) that secured the lien so extended, renewed or replaced (plus improvements and construction on real property).
 
(2)            Limitation on Sale/Leaseback Transactions.
 
The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction unless:
 
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(a)            the Company or such Restricted Subsidiary, at the time of entering into a Sale and Lease-Back Transaction, would be entitled to incur Indebtedness secured by a lien on the Principal Property to be leased in an amount at least equal to the Attributable Debt in respect of such Sale and Lease-Back Transaction, without equally and ratably securing the Securities pursuant to subsection (1) above; or
 
(b)            the direct or indirect proceeds of the sale of the Principal Property to be leased are at least equal to the fair value of such Principal Property (as determined by the Company’s Board of Directors) and an amount equal to the net proceeds from the sale of the property or assets so leased is applied, within 180 days of the effective date of any such Sale and Lease-Back Transaction, to the purchase or acquisition (or, in the case of real property, commencement of the construction) of property or assets or to the retirement (other than at maturity or pursuant to a mandatory sinking fund or mandatory redemption provision) of Securities, or of Funded Indebtedness of the Company or a consolidated Subsidiary ranking on a parity with or senior to the Securities; provided that there shall be credited to the amount of net worth proceeds required to be applied pursuant to this clause (b) an amount equal to the sum of (i) the principal amount of Securities delivered within 180 days of the effective date of such Sale and Lease-Back Transaction to the Trustee for retirement and cancellation and (ii) the principal amount of other Funded Indebtedness voluntarily retired by the Company within such 180-day period, excluding retirements of Securities and other Funded Indebtedness as a result of conversions or pursuant to mandatory sinking fund or mandatory prepayment provisions.
 
(3)            Change of Control Triggering Event.
 
(a)            Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem the Offered Securities pursuant to Section 1.1(6) hereof or Section 14.01 of the Base Indenture, each Holder will have the right to require that the Company purchase all or a portion, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of such Holder’s Offered Securities pursuant to Section 1.3(3)(b) hereof (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.
 
(b)            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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer. Such notice shall describe the transaction or transactions that constitute the Change of Control and shall state:
 
(A)           that the Change of Control Offer is being made pursuant to this Section 1.3(3) of this Second Supplemental Indenture;
 
(B)            that the Company is required to offer to purchase all of the outstanding principal amount of Offered Securities, the purchase price and, that on the date specified in such notice, which date shall be no earlier than 30 days
 
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and no 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 Company shall repurchase the Offered Securities validly tendered and not withdrawn pursuant to this Section 1.3(3);
 
(C)            if mailed prior to the date of consummation of the Change of Control, shall state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring on or prior to the Change of Control Payment Date;
 
(D)           that any Offered Security not tendered or accepted for payment shall continue to accrue interest;
 
(E)            that, unless the Company defaults in making such payment, Offered Securities accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date;
 
(F)            that Holders electing to have an Offered Security purchased pursuant to a Change of Control Offer may elect to have all or any portion of such Offered Security purchased;
 
(G)            that Holders of Offered Securities electing to have Offered Securities purchased pursuant to a Change of Control Offer shall be required to surrender their Offered Securities, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Offered Security, or such other customary documents of surrender and transfer as the Company may reasonably request, duly completed, or transfer the Offered Security by book-entry transfer, to the paying agent at the address specified in the notice prior to the Change of Control Payment Date;
 
(H)           that Holders shall be entitled to withdraw their election if the Company, the Depositary or the paying agent, as the case may be, receives, not later than the expiration of the Change of Control Offer, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Offered Security the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have such Offered Security purchased;
 
(I)             that Holders whose Offered Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered (or transferred by book-entry transfer); and
 
(J)             the CUSIP number, if any, printed on the Offered Securities being repurchased and that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Offered Securities.
 
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(c)            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 Offered Securities properly tendered and not withdrawn under its offer.
 
(d)            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 such laws and regulations are applicable in connection with the repurchase of Offered Securities pursuant to a Change of Control Offer. To the extent that any securities laws or regulations conflict with the provisions of this Section 1.3(3), the Company shall comply with the applicable securities laws and regulations and shall be deemed not to have breached its obligations under this Section 1.3(3) by virtue thereof.
 
Section 1.4              Additional Event of Default .
 
The following additional event shall be established and shall constitute an “Event of Default” under Section 6.01(a) of the Base Indenture with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding:
 
(9)            an event of default shall happen and be continuing with respect to the Company’s or Parent’s Indebtedness for borrowed money (other than Non-Recourse Indebtedness) under any indenture or other instrument evidencing or under which the Company or Parent shall have a principal amount outstanding (such amount with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities based on the accreted amount determined in accordance with United States generally accepted accounting principles and as of the date of the most recently prepared consolidated balance sheet of the Company or Parent, as the case may be) in excess of $100,000,000, and such event of default shall involve the failure to pay the principal of such Indebtedness on the final maturity date thereof after the expiration of any applicable grace period with respect thereto, or such Indebtedness shall have been accelerated so that the same shall have become due and payable prior to the date on which the same would otherwise have become due and payable, and such acceleration shall not be rescinded or annulled within ten Business Days after notice thereof shall have been given to the Company and Parent by the Trustee, or to the Company, Parent and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities; provided that, if such event of default under such indenture or instrument shall be remedied or cured by the Company or Parent or waived by the requisite holders of such Indebtedness, then the Event of Default hereunder by reason thereof shall be deemed likewise to have been thereupon remedied, cured or waived without further action upon the part of either the Trustee or any of the Securityholders, and provided further, however, that subject to the provisions of Sections 7.01 and 7.02, the Trustee shall not be charged with knowledge of any such event of default unless written notice thereof shall have been given to the Trustee by the Company or Parent, as the case may be, by the holder or an agent of the holder of any such Indebtedness, by the trustee then acting under any indenture or other instrument under which such default shall have occurred, or by the Holders of not less than 25% in the aggregate principal amount of Outstanding Securities.
 
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ARTICLE II
 
MISCELLANEOUS
 
Section 2.1.             Definitions .
 
Capitalized terms used but not defined in this Second Supplemental Indenture shall have the meanings ascribed thereto in the Base Indenture.
 
Section 2.2.             Confirmation of Indenture .
 
The Base Indenture, as supplemented and amended by this Second Supplemental Indenture, is in all respects ratified and confirmed, and the Base Indenture, this Second Supplemental Indenture and all indentures supplemental thereto shall be read, taken and construed as one and the same instrument.
 
Section 2.3.             Concerning the Trustee .
 
In carrying out the Trustee’s responsibilities hereunder, the Trustee shall have all of the rights, protections and immunities which it possesses under the Indenture. The recitals contained herein and in the Offered Securities, except the Trustee’s certificate of authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Second Supplemental Indenture or of the Offered Securities. The Trustee shall not be accountable for the use or application by the Company of the Offered Securities or the proceeds thereof.
 
Section 2.4.             Governing Law .
 
This Second Supplemental Indenture and the Offered Securities shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State without regard to conflicts of laws principles that would require the application of any other law.
 
Section 2.5.             Separability .
 
In case any provision in this Second Supplemental Indenture shall for any reason be held to 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 2.6.             Counterparts .
 
This Second Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
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Section 2.7              No Benefit .
 
Nothing in this Second Supplemental Indenture, express or implied, shall give to any Person other than the parties hereto and their successors or assigns, and the holders of the Offered Securities, any benefit or legal or equitable rights, remedy or claim under this Second Supplemental Indenture or the Base Indenture.
 
17

 
IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed all as of the day and year first above written.

 	 	
 	 	TYCO ELECTRONICS GROUP S.A.	
 	 	 	
 	 	By:	/s/ Mario Calastri	 	
 	 	 	Name:	Mario Calastri	
 	 	 	Title:	Director	

 	 	TYCO ELECTRONICS LTD.	
 	 	 	
 	 	By:	/s/ Terrence R. Curtin	 	
 	 	 	Name:	Terrence R. Curtin	
 	 	 	Title:	Executive Vice President and	
 	 	 	 	Chief Financial Officer	

 	 	DEUTSCHE BANK TRUST COMPANY
AMERICAS
as Trustee	
 	 	 	
 	 	By:	 /s/ Richard L. Buckwalter	 	
 	 	 	Name:	Richard L. Buckwalter	
 	 	 	Title:	Director	

 	 	By:	 /s/ Carol Ng	 	
 	 	 	Name:	Carol Ng	
 	 	 	Title:	Vice President	

 
 
EXHIBIT A
FORM OF 6.550% SENIOR NOTES
 
 [Insert the Private Placement Legend and/or the Global Security legend, as applicable]
 
6.550% SENIOR NOTES DUE 2017

No. [      ]	 	$[               ]	
CUSIP No. [                 ]	 	 	
 
TYCO ELECTRONICS GROUP S.A.
 
promises to pay to Cede & Co. or registered assigns, the principal sum of [              ] Dollars on [        ].
 
Interest Payment Dates: April 1 and October 1
 
Record Dates:  March 16 and September 15
 
Each holder of this Security (as defined below), by accepting the same, agrees to and shall be bound by the provisions hereof and of the Indenture described herein, and authorizes and directs the Trustee described herein on such holder’s behalf to be bound by such provisions. Each holder of this Security hereby waives all notice of the acceptance of the provisions contained herein and in the Indenture and waives reliance by such holder upon said provisions.
 
This Security shall not be entitled to any benefit under the Indenture, or be valid or become obligatory for any purpose, until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee. The provisions of this Security are continued on the reverse side hereof, and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.
 
IN WITNESS WHEREOF, the Company has caused this instrument to be signed in accordance with Section 2.04 of the Indenture.
 
Date:  [        ]

 	TYCO ELECTRONICS GROUP S.A.	

 	 	
 	Name:	
 	Title:	
 	 	
 	[If second signature is applicable:]	

 	Name:	
 	Title:	
 
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CERTIFICATE OF AUTHENTICATION
 
This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee	
 	 	
 	By:	 	 	
 	 	Authorized Signatory	
 	 	 	
 	By:	 	 	
 	 	Authorized Signatory	
 	 	 	
 	Dated: [        ]	

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GUARANTEE
 
For value received, TYCO ELECTRONICS LTD. hereby absolutely, unconditionally and irrevocably guarantees to the holder of this Security the payment of principal of, premium, if any, and interest on, the Security upon which this Guarantee is set forth in the amounts and at the time when due and payable whether by declaration thereof or otherwise, and interest on the overdue principal and interest, if any, of such Security, if lawful, to the holder of such Security and the Trustee on behalf of the holders, all in accordance with and subject to the terms and limitations of such Security and Article XV of the Indenture. This Guarantee will not become effective until the Trustee or Authenticating Agent duly executes the certificate of authentication on this Security. This Guarantee shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of law principles thereof.

Dated: [        ]	 	
 	TYCO ELECTRONICS LTD.	

 	By:	 	 	
 	 	    Name:	 	
 	 	    Title:	 	
 
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Tyco Electronics Group S.A.
 
6.550 % Senior Notes due 2017
 
This security is one of a duly authorized series of debt securities of Tyco Electronics Group S.A., a Luxembourg company (the “Company”), issued or to be issued in one or more series under and pursuant to an Indenture for the Company’s unsubordinated debt securities, dated as of September 25, 2007 (the “Base Indenture”), duly executed and delivered by and among the Company, Tyco Electronics Ltd. (“Parent”) and Deutsche Bank Trust Company Americas (the “Trustee”), as supplemented by the Second Supplemental Indenture, dated as of September 25, 2007 (the “Second Supplemental Indenture”), by and among the Company, Parent and the Trustee. The Base Indenture as supplemented and amended by the Second Supplemental Indenture is referred to herein as the “Indenture.”  By the terms of the Base Indenture, the debt securities issuable thereunder are issuable in series that may vary as to amount, date of maturity, rate of interest and in other respects as provided in the Base Indenture. This security is one of the series designated on the face hereof (individually, a “Security,” and collectively, the “Securities”), and reference is hereby made to the Indenture for a description of the rights, limitations of rights, obligations, duties and immunities of the Trustee, the Company, Parent and the holders of the Securities (the “Securityholders”). Capitalized terms used herein and not otherwise defined shall have the meanings given them in the Base Indenture or the Second Supplemental Indenture, as applicable.
 
1. Interest .  The Company promises to pay interest on the principal amount of this Security at an annual rate of 6.550%, subject to adjustment as provided below. The Company will pay interest semi-annually on April 1 and October 1 of each year (each such day, an “Interest Payment Date”). If any Interest Payment Date, redemption date or maturity date of this Security is not a Business Day, then payment of interest or principal (and premium, if any) shall be made on the next succeeding Business Day with the same force and effect as if made on the date such payment was due, and no interest shall accrue for the period after such date to the next succeeding Business Day. Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from the date of issuance; provided that, if there is no existing Default in the payment of interest, and if this Security is authenticated between a regular record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; and provided, further, that the first Interest Payment Date shall be [        ]. Interest will be computed on the basis of a 360-day year of twelve 30-day months. In certain circumstances, liquidated damages may be payable as provided in Section 6.01 of the Indenture. Any such liquidated damages shall be payable in the same manner and on the same dates as the stated interest payable on this Security.
 
The interest rate payable on this Security shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to this Security as set forth in Section 1.1(4)(B) of the Indenture.
 
The Holder of this Security is entitled to the benefits of the Exchange and Registration Rights Agreement. Pursuant to the Exchange and Registration Rights Agreement, the Company
 
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has agreed (i) to file the Exchange Registration Statement (as defined in the Exchange and Registration Rights Agreement) as soon as practicable, but no later than 210 days after the Closing Date (as defined in the Exchange and Registration Rights Agreement), (ii) to use its commercially reasonable efforts to cause such Exchange Registration Statement to become effective under the Securities Act as soon as practicable, but no later than 300 days after the Closing Date, and (iii) to use its commercially reasonable efforts to commence and complete the Exchange Offer (as defined in the Exchange and Registration Rights Agreement) promptly, but no later than 45 days after such registration statement has become effective, hold the Exchange Offer open for at least 30 days and exchange Exchange Securities (as defined in the Exchange and Registration Rights Agreement) for all Registrable Securities (as defined in the Exchange and Registration Rights Agreement) that have been properly tendered and not withdrawn on or prior to the expiration of the Exchange Offer. If (i) on or prior to the time the Exchange Offer is completed existing SEC interpretations are changed such that debt securities or the related guarantee received by holders other than Restricted Holders (as defined in the Exchange and Registration Rights Agreement) in the Exchange Offer for Registrable Securities (as defined in the Exchange and Registration Rights Agreement) are not or would not be, upon receipt, transferable by each such holder without restriction under the Securities Act, (ii) the Exchange Offer is not completed within 345 days after the Closing Date or (iii) the Exchange Offer is not available to any Holder, then, in each case, the Company is required to (a) as soon as practicable but no later than 60 days after the time such obligation to file arises, file a Shelf Registration Statement (as defined in the Exchange and Registration Rights Agreement) and (b) use its commercially reasonable best efforts to cause the Shelf Registration Statement to become or be declared effective within 120 days after such Shelf Registration Statement is filed and to keep such Shelf Registration Statement continuously effective until the earlier of two years after the date as of which the Shelf Registration Statement became or was declared effective or such time as there are no longer any Registrable Securities outstanding. If (i) the Company fails to file the Exchange Registration Statement or the Shelf Registration Statement on or before the date specified for such filing, (ii) any of the Exchange Registration Statement or the Shelf Registration Statement is not declared effective by the date specified for such effectiveness, (iii) the Company fails to complete the Exchange Offer within 45 after the effectiveness target date with respect to the Exchange Registration Statement, (iv) any of the Exchange Registration Statement or the Shelf Registration Statement is declared effective but thereafter is withdrawn or ceases to be effective due to a stop order issued pursuant to the Securities Act suspending the effectiveness of such registration statement without being succeeded by an additional registration statement filed and declared effective or (v) the Company requires Holders to refrain from disposing of their Registrable Securities under certain circumstances described in the Exchange and Registration Rights Agreement and that suspension period exceeds 45 days in any one instance or 90 days in the aggregate during any consecutive 12 month period (each such event referred to in clauses (i) through (v), a “Registration Default” and each period during which a Registration Default has occurred and is continuing, a “Registration Default Period”), then, as liquidated damages for such Registration Default, subject to certain exceptions, special interest (“Special Interest”) shall accrue at a per annum rate of 0.25% for the first 90 days of the Registration Default Period and at a per annum rate of 0.50% thereafter for the remaining portion of the Registration Default Period.
 
2.   Method of Payment .  The Company will pay interest on the Securities (except defaulted interest), if any, to the persons in whose name such Securities are registered at the
 
A-5

 
close of business on the regular record date referred to on the facing page of this Security for such interest installment. In the event that the Securities or a portion thereof are called for redemption and the Redemption Date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Securities will be paid upon presentation and surrender of such Securities as provided in the Indenture. The principal of and the interest on the Securities shall be payable in the coin or currency of the United States of America that at the time is legal tender for public and private debt, at the office or agency of the Company maintained for that purpose in accordance with the Indenture.
 
3.   Paying Agent and Registrar .  Initially, Deutsche Bank Trust Company Americas, the Trustee, will act as paying agent and Security Registrar. The Company may change or appoint any paying agent or Security Registrar without notice to any Securityholder. Parent, the Company or any of their Subsidiaries may act in any such capacity.
 
4.   Indenture .  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (“TIA”) as in effect on the date the Indenture is qualified. The Securities are subject to all such terms, and Securityholders are referred to the Indenture and TIA for a statement of such terms. The Securities are unsecured general obligations of the Company and constitute the series designated on the face hereof as the “6.550% Senior Notes due 2017”, initially limited to $750,000,000 in aggregate principal amount. The Company will furnish to any Securityholder upon written request and without charge a copy of the Base Indenture and the Second Supplemental Indenture. Requests may be made to: Tyco Electronics Group S.A., 17, boulevard Grande-Duchesse Charlotte, L-1331 Luxembourg, Attention: The Managing Directors.
 
5.   Optional Redemption .  The Securities will be subject to redemption at the option of the Company on any date prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), on written notice given to the Securityholders thereof not less than 30 days nor more than 90 days prior to the date fixed for redemption in such notice (the “Redemption Date”), at a redemption price equal to the greater of (i) 100% of the principal amount of such Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of  interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 30 basis points (such greater amount is referred to herein as the “Redemption Price”), plus, in either the case of clause (i) or clause (ii), accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date. This Security is also subject to redemption to the extent provided in Article XIV of the Indenture.
 
If the giving of the notice of redemption is completed as provided in the Indenture, interest on such Securities or portions of Securities shall cease to accrue on and after the Redemption Date, unless the Company shall default in the payment of such Redemption Price and accrued interest with respect to any such Security or portion thereof.
 
A-6

 
The Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Securities.
 
6.   Change of Control Triggering Event . Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem this Security, the holder of this Security will have the right to require that the Company purchase all or a portion, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of this Security at a purchase price equal to 101% of the principal amount hereof plus accrued and unpaid interest, if any, to the date of purchase. 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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer.
 
7.   Denominations, Transfer, Exchange .  The Securities are in registered form without coupons in the denominations of $2,000 or any integral multiple of $1,000 in excess thereof. The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture. The Securities may be presented for exchange or for registration of transfer (duly endorsed or with the form of transfer endorsed thereon duly executed if so required by the Company or the Security Registrar) at the office of the Security Registrar or at the office of any transfer agent designated by the Company for such purpose. No service charge will be made for any registration of transfer or exchange, but a Securityholder may be required to pay any applicable taxes or other governmental charges. If the Securities are to be redeemed, the Company will not be required to:  (i) issue, register the transfer of, or exchange any Security during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of less than all of the outstanding Securities of the same series and ending at the close of business on the day of such mailing; (ii) register the transfer of or exchange any Security of any series or portions thereof selected for redemption, in whole or in part, except the unredeemed portion of any such Security being redeemed in part; nor (iii) register the transfer of or exchange a Security of any series between the applicable record date and the next succeeding Interest Payment Date.
 
8.   Persons Deemed Owners .  The registered Securityholder may be treated as its owner for all purposes.
 
9. Repayment to Parent or the Company . Any funds or Governmental Obligations deposited with any paying agent or the Trustee, or then held by Parent or the Company, in trust for payment of principal of, premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least one year after the date upon which the principal of, premium, if any, or interest on such Securities shall have respectively become due and payable, shall be repaid to Parent or the Company, as applicable, or (if then held by Parent or the Company) shall be discharged from such trust. After return to the Company or Parent, Holders entitled to the money or securities must look to the Company or Parent, as applicable, for payment as unsecured general creditors.
 
10.   Amendments, Supplements and Waivers .  The Base Indenture contains provisions permitting the Company, Parent and the Trustee, with the consent of the holders of not less than
 
A-7

 
a majority in aggregate principal amount of the Outstanding Securities  to enter into supplemental indentures for the purpose of adding, changing or eliminating any provisions to the Base Indenture or supplemental indenture or indentures or of modifying in any manner not covered elsewhere in the Base Indenture the rights of the holders of the Securities of such series; provided , however , that no such supplemental indenture, without the consent of the holders of each Security then Outstanding and affected thereby, shall:  (i) extend a fixed maturity of or any installment of principal of any Securities of any series or reduce the principal amount thereof, or reduce the amount of principal of any original issue discount security that would be due and payable upon declaration of acceleration of the maturity thereof; (ii) reduce the rate of or extend the time for payment of interest of any Security of any series; (iii) reduce the premium payable upon the redemption of any Security; (iv) make any Security payable in Currency other than that stated in the Security; (v) impair the right to institute suit for the enforcement of any payment on or after the fixed maturity thereof (or in the case or redemption, on or after the redemption date); or (vi) reduce the percentage of Securities, the holders of which are required to consent to any such supplemental indenture or indentures. The Base Indenture also contains provisions permitting the holders of not less than a majority in aggregate principal amount of the Outstanding securities of each series affected thereby, on behalf of all of the holders of the securities of such series, to waive any past Default under the Base Indenture, and its consequences, except a Default in the payment of the principal of, premium, if any, or interest on any security of such series or a Default in respect of a covenant or provision of the Base Indenture that cannot be modified or amended without the consent of the holder of each Outstanding security of such affected series. Any such consent or waiver by the registered Securityholder shall be conclusive and binding upon such holder and upon all future holders and owners of this Security and of any Security issued in exchange for this Security or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Security.
 
11.   Defaults and Remedies .  If an Event of Default with respect to the securities of a series issued pursuant to the Base Indenture occurs and is continuing, the Trustee or the holders of at least 25% in aggregate principal amount of the Securities of such series then Outstanding, by notice in writing to the Company and Parent (and to the Trustee if notice is given by such holders), may declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately. Subject to the terms of the Indenture, if an Event of Default under the Indenture shall occur and be continuing, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the holders, unless such holders have offered the Trustee indemnity satisfactory to it. Upon satisfaction of certain conditions set forth in the Indenture, the holders of a majority in principal amount of the Outstanding securities of a series issued pursuant to the Base Indenture will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the securities of such series.
 
12. Trustee, Paying Agent and Security Registrar May Hold Securities . The Trustee, subject to certain limitations imposed by the TIA, or any paying agent or Security Registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, paying agent or Security Registrar.
 
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13.   No Recourse Against Others .  No recourse under or upon any obligation, covenant or agreement of the Indenture, or of any Security, or for any claim based thereon or otherwise in respect hereof or thereof, shall be had against any incorporator, stockholder, officer or director, past, present or future as such, of Parent or the Company or of any predecessor or successor corporation, either directly or through Parent or the Company or any such predecessor or 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 the Indenture and the obligations issued hereunder and thereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, shareholders, officers or directors as such, of Parent or the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, shareholder, officer or director as such, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the acceptance of the Securities.
 
14.   Discharge of Indenture .  The Indenture contains certain provisions pertaining to defeasance, which provisions shall for all purposes have the same effect as if set forth herein.
 
15.  Authentication .  This Security shall not be valid until the Trustee signs the certificate of authentication attached to the other side of this Security.
 
16. Guarantees . All payments by the Company under the Indenture and this Security are fully and unconditionally guaranteed to the holder of this Security by Parent, as provided in the related Guarantee and the Indenture.
 
17. Additional Amounts . The Company and Parent are obligated to pay Additional Amounts on this Security to the extent provided in Article XIV of the Indenture.
 
18.   Abbreviations .  Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
 
19.   Governing Law .  The Base Indenture, the Second Supplemental Indenture and this Security (and the Guarantee hereon) shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State.
 
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ASSIGNMENT FORM
 
To assign this Security, fill in the form below: (I) or (we) assign and transfer this Security to                               

(Insert assignee’s soc. sec. or tax I.D. no.)

 

 

(Print or type assignee’s name, address and zip code)
and irrevocably appoint                                                                                                                                           agent to transfer this Security on the books of the Company. The agent may substitute another to act for him.

 

Date:	 	 	 	
 	 	
 	Your Signature:	 	 	
 	(Sign exactly as your name appears on the face of this
Security)	

Signature Guarantee:	 	 	 	

A-10

 
OPTION OF HOLDER TO ELECT PURCHASE
 
If you want to elect to have this Security purchased by the Company pursuant to Section 1.3(3) of the Second Supplemental Indenture, check the box:
 
o   1.3(3) Change of Control Triggering Event
 
If you want to elect to have only part of this Security purchased by the Company pursuant to Section 1.3(3) of the Second Supplemental Indenture, state the amount:  $                  .

 	Date:	 	 	  Your Signature:	
 	(Sign exactly as your name appears	
 	on the other side of the Security)	

 	Tax I.D. number	 	

Signature Guarantee:	 	 	 	
 	(Signature must be guaranteed by a	 	
 	participant in a recognized signature	 	
 	guarantee medallion program)	 	

EXHIBIT 4.1(d)

TYCO ELECTRONICS GROUP S.A.,
as Issuer

AND

TYCO ELECTRONICS LTD.,
as Guarantor

AND

DEUTSCHE BANK TRUST
COMPANY AMERICAS,
as Trustee

THIRD SUPPLEMENTAL INDENTURE
Dated as of September 25, 2007
 
$500,000,000 of 7.125% Senior Notes due 2037

 
THIS THIRD SUPPLEMENTAL INDENTURE is dated as of September 25, 2007 among TYCO ELECTRONICS GROUP S.A., a Luxembourg company (the “ Company ”), TYCO ELECTRONICS LTD., a Bermuda company (“ Parent ”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation (the “ Trustee ”).
 
RECITALS
 
A.            Parent, the Company and the Trustee executed and delivered an Indenture, dated as of September 25, 2007, (the “ Base Indenture ”), to provide for the issuance by the Company from time to time of unsubordinated debt securities evidencing its unsecured indebtedness.
 
B.            Pursuant to Board Resolution, the Company has authorized the issuance of the $500,000,000 principal amount of 7.125% Senior Notes due 2037 (the “ Offered Securities ”).
 
C.            The entry into this Third Supplemental Indenture by the parties hereto is in all respects authorized by the provisions of the Base Indenture.
 
D.            Parent and the Company desire to enter into this Third Supplemental Indenture pursuant to Section 9.01 of the Base Indenture to establish the terms of the Offered Securities in accordance with Section 2.01 of the Base Indenture and to establish the form of the Offered Securities in accordance with Section 2.02 of the Base Indenture.
 
E.             All things necessary to make this Third Supplemental Indenture a valid indenture and agreement according to its terms have been done.
 
NOW, THEREFORE, for and in consideration of the foregoing premises, Parent, the Company and the Trustee mutually covenant and agree for the equal and proportionate benefit of the respective holders from time to time of the Offered Securities as follows:
 
ARTICLE I
 
Section 1.1.                                    Terms of Offered Securities .
 
The following terms relate to the Offered Securities:
 
(1)           The Offered Securities constitute a series of securities having the title “7.125% Senior Notes due 2037”.
 
(2)           The initial aggregate principal amount of the Offered Securities that may be authenticated and delivered under the Base Indenture (except for Offered Securities authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of, other Offered Securities pursuant to Section 2.05, 2.06, 2.07, 2.11, or 3.03) is $500,000,000.
 
(3)           The entire Outstanding principal of the Offered Securities shall be payable on October 1, 2037.

 
(4)           (A)          The rate at which the Offered Securities shall bear interest initially shall be 7.125% per year (the “ Original Interest Rate ”) plus Special Interest, if any, payable pursuant to the Exchange and Registration Rights Agreement and as set forth in the Offered Securities, and shall be subject to adjustments as provided in Section 1.1(4)(B). The date from which interest shall accrue on the Offered Securities shall be September 25, 2007, or the most recent Interest Payment Date to which interest has been paid or provided for. The Interest Payment Dates for the Offered Securities shall be April 1 and October 1 of each year, beginning April 1, 2008. Interest shall be payable on each Interest Payment Date to the holders of record at the close of business on the March 16 and September 15 prior to each Interest Payment Date (a “ regular record date ”). The basis upon which interest shall be calculated shall be that of a 360-day year consisting of twelve 30-day months.
 
(B)           The interest rate payable on the Offered Securities shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to the Offered Securities as set forth in this Section 1.1(4)(B). If the rating from Moody’s, S&P or Fitch of the Offered Securities is decreased to a rating set forth in the immediately following table, the interest rate on the Offered Securities shall increase from the Original Interest Rate by adding the percentage set forth opposite the rating applicable to the lowest two rating levels assigned to such Offered Securities by any of Moody’s, S&P and Fitch:
 
Rating Agency

Moody’s	 	S&P	 	Fitch	 	Percentage	 	
Ba1	 	BB+	 	BB+	 	0.25	%	
Ba2	 	BB	 	BB	 	0.50	%	
Ba3	 	BB-	 	BB-	 	0.75	%	
B1 or below	 	B or below	 	B or below	 	1.00	%	
 
If at any time the interest rate on the Offered Securities has been adjusted upward and Moody’s, S&P or Fitch, as the case may be, subsequently increases its rating of the Offered Securities to any of the threshold ratings set forth above, the interest rate on the Offered Securities shall be decreased such that the interest rate for the Offered Securities equals the Original Interest Rate plus the percentages set forth opposite the ratings from the tables above in effect immediately following the increase applicable to the two lowest rating levels assigned to such Offered Securities by any of Moody’s, S&P or Fitch. If Moody’s subsequently increases its rating of the Offered Securities to Baa3 or higher, S&P increases its rating to BBB- or higher and Fitch increases its rating to BBB- or higher, the interest rate on the Offered Securities will be decreased to the Original Interest Rate.
 
Each adjustment required by any decrease or increase in a rating set forth above, whether occasioned by the action of Moody’s, S&P or Fitch, shall be made independent of any and all other adjustments; provided that in determining any adjustment, the percentage applicable to the lowest two rating levels assigned to the Offered Securities by any of Moody’s, S&P and Fitch shall be used. In no event shall (1) the interest rate for the Offered Securities be reduced to below the Original Interest Rate or (2) the total increase in the interest rate on the Offered Securities exceed 2.00% above the Original Interest Rate.
 
Third Supplemental Indenture
 
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If any two of Moody’s, S&P or Fitch cease to provide a rating of the Offered Securities, any subsequent increase or decrease in the interest rate of the Offered Securities necessitated by a reduction or increase in the rating by the agency continuing to provide the rating shall be twice the percentage set forth in the applicable table above. No adjustments in the interest rate of the Offered Securities shall be made solely as a result of Moody’s, S&P or Fitch ceasing to provide a rating. If Moody’s, S&P and Fitch all cease to provide a rating of the Offered Securities, the interest rate on the Offered Securities shall increase to, or remain at, as the case may be, 2.00% above the Original Interest Rate. References to Moody’s, S&P and Fitch in this Section 1.1(4)(B) shall be deemed to include any successors to Moody’s, S&P and Fitch.
 
Any interest rate increase or decrease described above will take effect from the first day of the interest period during which a rating change requires an adjustment in the interest rate.
 
The interest rate on the Offered Security will permanently cease to be subject to any adjustments described in this Section 1.1(4)(B) (notwithstanding any subsequent decrease in the ratings by any or all of Moody’s, S&P or Fitch or any or all of Moody’s, S&P or Fitch ceasing to provide ratings) and shall be set at the Original Interest Rate if the Offered Securities become rated A3, A- or A- or higher by any two of Moody’s, S&P and Fitch, respectively (or one of these ratings if only rated by one of Moody’s, S&P and Fitch), with a stable or positive outlook by both such rating agencies.
 
(5)           The Offered Securities shall be issuable in whole in the form of one or more registered Restricted Global Securities, and the Depository for such Restricted Global Securities shall be The Depository Trust Company, New York, New York. The Offered Securities shall be substantially in the form attached hereto as Exhibit A the terms of which are herein incorporated by reference. The Offered Securities shall be issuable in denominations of $2,000 or any integral multiple of $1,000 in excess thereof.
 
(6)            (A)          The Offered Securities will be subject to redemption at the option of the Company on any date (a “ Redemption Date ”) prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), at a redemption price equal to the greater of (i) 100% of the principal amount of the Offered Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 35 basis points (such greater amount is referred to herein as the “ Redemption Price ”), plus accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date.
 
(B)           As used herein:
 
“ Adjusted Redemption Treasury Rate ”, with respect to any Redemption Date, means the rate equal to the semiannual equivalent yield to maturity or interpolated (on a 30/360 day count basis) yield to maturity of the Comparable Redemption Treasury Issue, assuming a
 
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price for the Comparable Redemption Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Redemption Treasury Price for such Redemption Date.
 
“ Comparable Redemption Treasury Issue ” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Offered Securities to be redeemed that will be utilized 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 Offered Securities.
 
“ Comparable Redemption Treasury Price ”, with respect to any Redemption Date, means (i) the average of the Redemption Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Redemption Reference Treasury Dealer Quotations (unless there is more than one highest or lowest quotation, in which case only one such highest and/or lowest quotation shall be excluded), or (ii) if the Quotation Agent obtains fewer than four such Redemption Reference Treasury Dealer Quotations, the average of all such Redemption Reference Treasury Dealer Quotations.
 
“ Quotation Agent ” means a Redemption Reference Treasury Dealer appointed as such agent by the Company.
 
“ Redemption Reference Treasury Dealer ” means four primary U.S. Government securities dealers in the United States selected by the Company.
 
“ Redemption Reference Treasury Dealer Quotations ”, with respect to each Redemption Reference Treasury Dealer and any Redemption Date, means the average, as determined by the Quotation Agent, of the bid and offer prices at 11:00 a.m. New York City time for the Comparable Redemption Treasury Issue (expressed in each case as a percentage of its principal amount) for settlement on the Redemption Date quoted in writing to the Quotation Agent by such Redemption Reference Treasury Dealer on the third Business Day preceding such Redemption Date.
 
(7)           The Offered Securities will not have the benefit of any sinking fund.
 
(8)           Except as provided herein, the holders of the Offered Securities shall have no special rights in addition to those provided in the Base Indenture upon the occurrence of any particular events.
 
(9)           The Offered Securities will be general unsecured and unsubordinated obligations of the Company and will be ranked equally among themselves.
 
(10)         The Offered Securities are not convertible into shares of common stock or other securities of the Company.
 
(11)         The additional Event of Default and restrictive covenants set forth in Sections 1.3 and 1.4 shall be applicable to the Offered Securities.
 
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Section 1.2                                       Additional Defined Terms .
 
As used herein, the following defined terms shall have the following meanings with respect to the Offered Securities only:
 
“ Accounts Receivable ” of any Person means the accounts receivable of such Person generated by the sale of inventory to third-party customers in the ordinary course of business.
 
“ Attributable Debt ”, in connection with a Sale and Lease-Back Transaction, as of any particular time, means the aggregate of present values (discounted at a rate that, at the inception of the lease, represents the effective interest rate that the lessee would have incurred to borrow over a similar term the funds necessary to purchase the leased assets) of the obligations of the Company or any Restricted Subsidiary for net rental payments during the remaining term of the applicable lease, including any period for which such lease has been extended or, at the option of the lessor, may be extended. The term “net rental payments” under any lease of any period shall mean the sum of the rental and other payments required to be paid in such period by the lessee thereunder, not including any amounts required to be paid by such lessee, whether or not designated as rental or additional rental, on account of maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges required to be paid by such lessee thereunder or any amounts required to be paid by such lessee thereunder contingent upon the amount of sales, maintenance and repairs, reconstruction, insurance, taxes, assessments, water rates or similar charges.
 
“ Below Investment Grade Rating Event ” means the Offered Securities are rated below an Investment Grade Rating by at least two of the Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of the Change of Control (which 60-day period shall be extended so long as the rating of the Offered Securities is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall be deemed not to have occurred in respect of a particular Change of Control (and thus shall be deemed not to be a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the rating agencies making the reduction in rating to which this definition would otherwise apply do not publicly announce or publicly confirm or inform the Trustee in writing at its request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
 
“ Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
 
“ Change of Control ” means the occurrence of any of (1) the direct or indirect sale, 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 Parent and its subsidiaries taken as a whole to any person or group of persons for purposes of Section 13(d) of the Exchange Act other than Parent or one of its subsidiaries or a person controlled by Parent or
 
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one of its subsidiaries; (2) consummation of any transaction (including any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than Parent’s or its subsidiaries’ employee benefit plans, becomes the beneficial owner (as defined in Rules 13(d)(3) and 13(d)(5) under the Exchange Act), directly or indirectly, of more than 50% of the outstanding voting stock of Parent, measured by voting power rather than number of shares; or (3) the replacement of a majority of the board of directors of Parent over a two-year period from the directors who constituted the board of directors of Parent at the beginning of such period, and such replacement shall not have been approved by at least a majority of the board of directors of Parent then still in office (either by a specific vote or by approval of a proxy statement in which such member was named as a nominee for election as a director, without objection to such nomination) who either were members of such board of directors at the beginning of such period or whose election as a member of such board of directors was previously so approved; provided, that, a transaction effected to create a holding company for Parent will not be deemed to involve a Change of Control if: (1) pursuant to such transaction Parent becomes a direct or indirect wholly-owned subsidiary of such 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 Parent’s voting stock immediately prior to that transaction. Following any such transaction, references in this definition to Parent shall be deemed to refer to such holding company. For purposes of this definition, “voting stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) 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.
 
“ Consolidated Net Worth ” at any date means total assets less total liabilities, in each case appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet.
 
“ Consolidated Tangible Assets ” at any date means total assets less all intangible assets appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles as in effect on the date of the consolidated balance sheet. “Intangible assets” means the amount (if any) stated under the heading “Goodwill and Other Intangible assets, net” or under any other heading of intangible assets separately listed, in each case on the face of such consolidated balance sheet.
 
“ Exchange and Registration Rights Agreement ” means the Exchange and Registration Rights Agreement, dated as of September 25, 2007, between the Company, Parent and the other parties named on the signature pages thereof, relating to the Offered Securities, as such agreement may be amended or supplemented from time to time and, with respect to any debt securities (other than the Offered Securities) issued under this Indenture as part of the same series as the Offered Securities, one or more registration rights agreements among the Company, Parent and the other parties thereto, as such agreement(s) may be amended or supplemented from time to time, relating to rights given by the Company and Parent to the purchasers of such additional debt securities to register such additional debt securities under the Securities Act.
 
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“ Fitch ” means Fitch Ratings Ltd.
 
“ Funded Indebtedness ” means any Indebtedness maturing by its terms more than one year from the date of the determination thereof, including any Indebtedness renewable or extendible at the option of the obligor to a date later than one year from the date of the determination thereof.
 
“ Indebtedness ” means, without duplication, the principal amount (such amount being the face amount or, with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities, determined based on the accreted amount as of the date of the most recently prepared consolidated balance sheet of Parent and its Subsidiaries as of the end of a fiscal quarter of Parent prepared in accordance with United States generally accepted accounting principles as in effect on the date of such consolidated balance sheet) of (i) all obligations for borrowed money, (ii) all obligations evidenced by debentures, notes or other similar instruments, (iii) all obligations in respect of letters of credit or bankers acceptances or similar instruments or reimbursement obligations with respect thereto (such instruments to constitute Indebtedness only to the extent that the outstanding reimbursement obligations in respect thereof are collateralized by cash or cash equivalents reflected as assets on a balance sheet prepared in accordance with United States generally accepted accounting principles), (iv) all obligations to pay the deferred purchase price of property or services, except (A) trade and similar accounts payable and accrued expenses, (B) employee compensation, deferred compensation and pension obligations, and other obligations arising from employee benefit programs and agreements or other similar employment arrangements, (C) obligations in respect of customer advances received and (D) obligations in connection with earnout and holdback agreements, in each case in the ordinary course of business, (v) all obligations as lessee to the extent capitalized in accordance with United States generally accepted accounting principles and (vi) all Indebtedness of others consolidated in such balance sheet that is guaranteed by the Company or any of its Subsidiaries or for which the Company or any of its Subsidiaries is legally responsible or liable (whether by agreement to purchase indebtedness of, or to supply funds or to invest in, others).
 
“ Investment Grade Rating ” means a rating equal to or higher than BBB- (or the equivalent) by Fitch, Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P.
 
“ Moody’s ” means Moody’s Investor Services Inc.
 
“ Non-Recourse Indebtedness ” means Indebtedness upon the enforcement of which recourse may be had by the holder(s) thereof only to identified assets of Parent or the Company or any Subsidiary of Parent or the Company and not to Parent or the Company or any Subsidiary of Parent or the Company personally (subject to, for the avoidance of doubt, customary exceptions contained in non-recourse financings to the non-recourse nature of the obligations thereunder).
 
“ Principal Property ” means any U.S. manufacturing, processing or assembly plant or any U.S. warehouse or distribution facility of the Parent or any of its Subsidiaries that is used by any U.S. Subsidiary of the Company and (A) is owned by the Parent or any Subsidiary of the Parent on the date hereof, (B) the initial construction of which has been completed after the date
 
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hereof, or (C) is acquired after the date hereof, in each case, other than any such plants, facilities, warehouses or portions thereof, that in the opinion of the Board of Directors of the Company, are not collectively of material importance to the total business conducted by the Parent and its subsidiaries as an entirety, or that has a net book value (excluding any capitalized interest expense), on the date hereof in the case of clause (A) of this definition, on the date of completion of the initial construction in the case of clause (B) of this definition or on the date of acquisition in the case of clause (C) of this definition, of less than the greater of $50,000,000 and 0.50% of Consolidated Tangible Assets on the consolidated balance sheet of Parent and its subsidiaries as of the applicable date.
 
“ Qualifying Subsidiary ” means a U.S. Subsidiary, the total Accounts Receivable of which exceeds the greater of $2.5 million and 0.20% of the amount stated under the heading “Accounts receivable, net of allowance for doubtful accounts,” or its equivalent, appearing on the most recently prepared consolidated balance sheet of Parent and its subsidiaries as of the end of a fiscal quarter of Parent, prepared in accordance with United States generally accepted accounting principles.
 
“ Rating Agencies ” means (1) each of Fitch, Moody’s and S&P; and (2) if any of Fitch, Moody’s or S&P ceases to rate the Offered Securities or fails to make a rating of the Offered Securities publicly available for reasons outside of the Company’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 certified by a resolution of the Company’s Board of Directors) as a replacement agency for Fitch, Moody’s or S&P, or all of them, as the case may be .
 
“ Restricted Subsidiary ” means any Subsidiary of the Company that owns or leases a Principal Property.
 
“ Sale and Lease-Back Transaction ” means an arrangement with any Person providing for the leasing by the Company or a Restricted Subsidiary of any Principal Property whereby such Principal Property has been or is to be sold or transferred by the Company or a Restricted Subsidiary to such Person other than Parent, the Company or any of their respective Subsidiaries; provided, however, that the foregoing shall not apply to any such arrangement involving a lease for a term, including renewal rights, for not more than three years.
 
“ S&P ” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.
 
“ Special Interest ” means all additional interest then owing pursuant to the Exchange and Registration Rights Agreement.
 
“ U.S. Subsidiary ” means any Subsidiary organized under the laws of a jurisdiction of the United States or any political subdivision thereof.
 
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Section 1.3.                                    Additional Covenants .
 
The following additional covenants shall apply with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding (but subject to defeasance, as provided in the Indenture):
 
(1)           Limitation on Liens.
 
The Company will not, and will not permit any Restricted Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a mortgage, pledge, security interest, lien or encumbrance (each a “ lien ”) upon any property that at the time of such issuance, assumption or guarantee constitutes a Principal Property, and the Company will not, and will not permit any U.S. Subsidiary that at the time of such issuance, assumption or guarantee is a Qualifying Subsidiary to, issue, assume or guarantee any Indebtedness that is secured by a lien upon such Qualifying Subsidiary’s Accounts Receivables, or any shares of stock of or Indebtedness issued by any such Restricted Subsidiary or such Qualifying Subsidiary, whether now owned or hereafter acquired, in each case without effectively providing that, for so long as such lien shall continue in existence with respect to such secured Indebtedness, the Offered Securities (together with, if the Company shall so determine, any other Indebtedness of the Company ranking equally with the Offered Securities, it being understood that for purposes hereof, Indebtedness which is secured by a lien and Indebtedness which is not so secured shall not, solely by reason of such lien, be deemed to be of different ranking) shall be equally and ratably secured by a lien ranking ratably with or equal to (or at the Company’s option prior to) such secured Indebtedness; provided, however, that the foregoing covenant shall not apply to:
 
(a)           liens existing on the date the Offered Securities are first issued;
 
(b)           liens on the stock, assets or Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary, unless created in contemplation of such Person becoming a Restricted Subsidiary;
 
(c)           liens on any assets or Indebtedness of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or a Restricted Subsidiary or at the time of a purchase, lease or other acquisition of the assets of a corporation or firm as an entirety or substantially as an entirety by the Company or any Restricted Subsidiary;
 
(d)           liens on any Principal Property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary, or liens to secure the payment of the purchase price of such Principal Property by the Company or any Restricted Subsidiary, or to secure any Indebtedness incurred, assumed or guaranteed by the Company or a Restricted Subsidiary for the purpose of financing all or any part of the purchase price of such Principal Property or improvements or construction thereon, which Indebtedness is incurred, assumed or guaranteed prior to, at the time of or within one year after such acquisition (or in the case of real property, completion of such improvement or construction or commencement of full operation of such property, whichever is later); provided, however, that in the case of any such acquisition, construction or improvement,
 
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the lien shall not apply to any Principal Property theretofore owned by the Company or a Restricted Subsidiary, other than the Principal Property so acquired, constructed or improved (and accessions thereto and improvements and replacements thereof and the proceeds of the foregoing);
 
(e)           liens securing Indebtedness owing by any subsidiary to the Company, Parent or a subsidiary thereof or by the Company to Parent;
 
(f)            liens in favor of the United States or any State thereof, or any department, agency or instrumentality or political subdivision of the United States of America or any State thereof, or in favor of any other country or any political subdivision thereof, to secure partial, progress, advance or other payments pursuant to any contract, statute, rule or regulation or to secure any Indebtedness incurred or guaranteed for the purpose of financing all or any part of the purchase price (or, in the case of real property, the cost of construction or improvement) of the Principal Property or assets subject to such liens (including liens incurred in connection with pollution control, industrial revenue or similar financings);
 
(g)           pledges, liens or deposits under workers’ compensation or similar legislation, and liens thereunder that are not currently dischargeable, or in connection with bids, tenders, contracts (other than for the payment of money) or leases to which the Company or any subsidiary is a party, or to secure the public or statutory obligations of the Company or any subsidiary, or in connection with obtaining or maintaining self-insurance, or to obtain the benefits of any law, regulation or arrangement pertaining to unemployment insurance, old age pensions, social security or similar matters, or to secure surety, performance, appeal or customs bonds to which the Company or any subsidiary is a party, or in litigation or other proceedings in connection with the matters heretofore referred to in this clause, such as interpleader proceedings, and other similar pledges, liens or deposits made or incurred in the ordinary course of business;
 
(h)           liens created by or resulting from any litigation or other proceeding that is being contested in good faith by appropriate proceedings, including liens arising out of judgments or awards against the Company or any subsidiary with respect to which the Company or such subsidiary in good faith is prosecuting an appeal or proceedings for review or for which the time to make an appeal has not yet expired; or final unappealable judgment liens which are satisfied within 15 days of the date of judgment; or liens incurred by the Company or any subsidiary for the purpose of obtaining a stay or discharge in the course of any litigation or other proceeding to which the Company or such subsidiary is a party;
 
(i)            liens for taxes or assessments or governmental charges or levies not yet due or delinquent; or that can thereafter be paid without penalty, or that are being contested in good faith by appropriate proceedings; landlord’s liens on property held under lease; and any other liens or charges incidental to the conduct of the business of the Company or any subsidiary, or the ownership of their respective assets, that were not incurred in connection with the borrowing of money or the obtaining of advances or credit and that, in the opinion of the Board of Directors of the Company, do not
 
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materially impair the use of such assets in the operation of the business of the Company or such subsidiary or the value of such Principal Property or assets for the purposes of such business;
 
(j)            liens to secure the Company’s or any subsidiary’s obligations under agreements with respect to spot, forward, future and option transactions, entered into in the ordinary course of business;
 
(k)           liens on (including securitization programs with respect to) accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as defined in the Uniform Commercial Code of the State of New York) (i) existing at the time of acquisition thereof by the Company or any U.S. Subsidiary or (ii) of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or any U.S. Subsidiary; provided that such liens were in existence, or granted or required to be granted or otherwise attach pursuant to any agreement in existence, prior to, and were not granted or such agreement was not entered into (as applicable) in contemplation of, such acquisition, merger or consolidation and such liens do not extend to any assets other than accounts receivable (including any accounts receivable constituting or evidenced by chattel paper, instruments or intangibles (as so defined) and rights (contractual and other) and collateral related thereto and proceeds of the foregoing and any related deposit accounts containing such proceeds;
 
(j)            liens not permitted by the foregoing clauses (a) to (k), inclusive, if at the time of, and after giving effect to, the creation or assumption of any such lien, the aggregate amount (without duplication) of all outstanding Indebtedness of the Company and its Restricted Subsidiaries secured by all such liens on such Principal Properties and all outstanding Indebtedness of the Company and its Qualifying Subsidiaries secured by all such liens on Accounts Receivable not so permitted by the foregoing clauses (a) through (k), inclusive, together with the Attributable Debt in respect of Sale and Lease-Back Transactions permitted by paragraph (a) under subsection (2) below do not exceed the greater of $1,500,000,000 and 10% of Consolidated Net Worth; and
 
(l)            any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part, of any lien referred to in the foregoing clauses (a) to (j), inclusive; provided, however, that the principal amount of Indebtedness secured thereby unless otherwise excepted under clauses (a) through (j) shall not exceed the principal amount of Indebtedness (plus the amount of any unused revolving credit or similar commitments) so secured at the time of such extension, renewal or replacement, and that such extension, renewal or replacement shall be limited to all or a part of the assets (or any replacements therefor) that secured the lien so extended, renewed or replaced (plus improvements and construction on real property).
 
(2)           Limitation on Sale/Leaseback Transactions.
 
The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction unless:
 
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(a)           the Company or such Restricted Subsidiary, at the time of entering into a Sale and Lease-Back Transaction, would be entitled to incur Indebtedness secured by a lien on the Principal Property to be leased in an amount at least equal to the Attributable Debt in respect of such Sale and Lease-Back Transaction, without equally and ratably securing the Securities pursuant to subsection (1) above; or
 
(b)           the direct or indirect proceeds of the sale of the Principal Property to be leased are at least equal to the fair value of such Principal Property (as determined by the Company’s Board of Directors) and an amount equal to the net proceeds from the sale of the property or assets so leased is applied, within 180 days of the effective date of any such Sale and Lease-Back Transaction, to the purchase or acquisition (or, in the case of real property, commencement of the construction) of property or assets or to the retirement (other than at maturity or pursuant to a mandatory sinking fund or mandatory redemption provision) of Securities, or of Funded Indebtedness of the Company or a consolidated Subsidiary ranking on a parity with or senior to the Securities; provided that there shall be credited to the amount of net worth proceeds required to be applied pursuant to this clause (b) an amount equal to the sum of (i) the principal amount of Securities delivered within 180 days of the effective date of such Sale and Lease-Back Transaction to the Trustee for retirement and cancellation and (ii) the principal amount of other Funded Indebtedness voluntarily retired by the Company within such 180-day period, excluding retirements of Securities and other Funded Indebtedness as a result of conversions or pursuant to mandatory sinking fund or mandatory prepayment provisions.
 
(3)           Change of Control Triggering Event.
 
(a)           Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem the Offered Securities pursuant to Section 1.1(6) hereof or Section 14.01 of the Base Indenture, each Holder will have the right to require that the Company purchase all or a portion , in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of such Holder’s Offered Securities pursuant to Section 1.3(3)(b) hereof (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.
 
(b)           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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer. Such notice shall describe the transaction or transactions that constitute the Change of Control and shall state:
 
(A)          that the Change of Control Offer is being made pursuant to this Section 1.3(3) of this Third Supplemental Indenture;
 
(B)           that the Company is required to offer to purchase all of the outstanding principal amount of Offered Securities, the purchase price and, that on the date specified in such notice, which date shall be no earlier than 30 days
 
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and no 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 Company shall repurchase the Offered Securities validly tendered and not withdrawn pursuant to this Section 1.3(3);
 
(C)           if mailed prior to the date of consummation of the Change of Control, shall state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring on or prior to the Change of Control Payment Date;
 
(D)          that any Offered Security not tendered or accepted for payment shall continue to accrue interest;
 
(E)           that, unless the Company defaults in making such payment, Offered Securities accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date;
 
(F)           that Holders electing to have an Offered Security purchased pursuant to a Change of Control Offer may elect to have all or any portion of such Offered Security purchased;
 
(G)           that Holders of Offered Securities electing to have Offered Securities purchased pursuant to a Change of Control Offer shall be required to surrender their Offered Securities, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Offered Security, or such other customary documents of surrender and transfer as the Company may reasonably request, duly completed, or transfer the Offered Security by book-entry transfer, to the paying agent at the address specified in the notice prior to the Change of Control Payment Date;
 
(H)          that Holders shall be entitled to withdraw their election if the Company, the Depositary or the paying agent, as the case may be, receives, not later than the expiration of the Change of Control Offer, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Offered Security the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have such Offered Security purchased;
 
(I)            that Holders whose Offered Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered (or transferred by book-entry transfer); and
 
(J)            the CUSIP number, if any, printed on the Offered Securities being repurchased and that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Offered Securities.
 
14

 
(c)           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 Offered Securities properly tendered and not withdrawn under its offer.
 
(d)           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 such laws and regulations are applicable in connection with the repurchase of Offered Securities pursuant to a Change of Control Offer. To the extent that any securities laws or regulations conflict with the provisions of this Section 1.3(3), the Company shall comply with the applicable securities laws and regulations and shall be deemed not to have breached its obligations under this Section 1.3(3) by virtue thereof.
 
Section 1.4                                       Additional Event of Default .
 
The following additional event shall be established and shall constitute an “Event of Default” under Section 6.01(a) of the Base Indenture with respect to the Offered Securities so long as any of the Offered Securities remain Outstanding:
 
(9)           an event of default shall happen and be continuing with respect to the Company’s or Parent’s Indebtedness for borrowed money (other than Non-Recourse Indebtedness) under any indenture or other instrument evidencing or under which the Company or Parent shall have a principal amount outstanding (such amount with respect to original issue discount bonds or zero coupon notes, bonds or debentures or similar securities based on the accreted amount determined in accordance with United States generally accepted accounting principles and as of the date of the most recently prepared consolidated balance sheet of the Company or Parent, as the case may be) in excess of $100,000,000, and such event of default shall involve the failure to pay the principal of such Indebtedness on the final maturity date thereof after the expiration of any applicable grace period with respect thereto, or such Indebtedness shall have been accelerated so that the same shall have become due and payable prior to the date on which the same would otherwise have become due and payable, and such acceleration shall not be rescinded or annulled within ten Business Days after notice thereof shall have been given to the Company and Parent by the Trustee, or to the Company, Parent and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities; provided that, if such event of default under such indenture or instrument shall be remedied or cured by the Company or Parent or waived by the requisite holders of such Indebtedness, then the Event of Default hereunder by reason thereof shall be deemed likewise to have been thereupon remedied, cured or waived without further action upon the part of either the Trustee or any of the Securityholders, and provided further, however, that subject to the provisions of Sections 7.01 and 7.02, the Trustee shall not be charged with knowledge of any such event of default unless written notice thereof shall have been given to the Trustee by the Company or Parent, as the case may be, by the holder or an agent of the holder of any such Indebtedness, by the trustee then acting under any indenture or other instrument under which such default shall have occurred, or by the Holders of not less than 25% in the aggregate principal amount of Outstanding Securities.
 
15

 
ARTICLE II
 
MISCELLANEOUS
 
Section 2.1.                                    Definitions .
 
Capitalized terms used but not defined in this Third Supplemental Indenture shall have the meanings ascribed thereto in the Base Indenture.
 
Section 2.2.                                    Confirmation of Indenture .
 
The Base Indenture, as supplemented and amended by this Third Supplemental Indenture, is in all respects ratified and confirmed, and the Base Indenture, this Third Supplemental Indenture and all indentures supplemental thereto shall be read, taken and construed as one and the same instrument.
 
Section 2.3.                                    Concerning the Trustee .
 
In carrying out the Trustee’s responsibilities hereunder, the Trustee shall have all of the rights, protections and immunities which it possesses under the Indenture. The recitals contained herein and in the Offered Securities, except the Trustee’s certificate of authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Third Supplemental Indenture or of the Offered Securities. The Trustee shall not be accountable for the use or application by the Company of the Offered Securities or the proceeds thereof.
 
Section 2.4.                                    Governing Law .
 
This Third Supplemental Indenture and the Offered Securities shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State without regard to conflicts of laws principles that would require the application of any other law.
 
Section 2.5.                                    Separability .
 
In case any provision in this Third Supplemental Indenture shall for any reason be held to 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 2.6.                                    Counterparts .
 
This Third Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.
 
16

 
Section 2.7                                       No Benefit .
 
Nothing in this Third Supplemental Indenture, express or implied, shall give to any Person other than the parties hereto and their successors or assigns, and the holders of the Offered Securities, any benefit or legal or equitable rights, remedy or claim under this Third Supplemental Indenture or the Base Indenture.
 
17

 
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed all as of the day and year first above written.

 	 	TYCO ELECTRONICS GROUP S.A.	
 	 	 	
 	 	By:	/s/ Mario Calastri	 	
 	 	 	Name:	Mario Calastri	
 	 	 	Title:	Director	

 	 	TYCO ELECTRONICS LTD.	
 	 	 	
 	 	By:	/s/ Terrence R. Curtin	 	
 	 	 	Name:	Terrence R. Curtin	
 	 	 	Title:	Executive Vice President and	
 	 	 	Chief Financial Officer	

 	 	DEUTSCHE BANK TRUST COMPANY AMERICAS	
 	 	as Trustee	
 	 	 	
 	 	By:	/s/ Richard L. Buckwalter	 	
 	 	 	Name:	Richard L. Buckwalter	
 	 	 	Title:	Director	

 	 	By:	/s/ Carol Ng	 	
 	 	 	Name:	Carol Ng	
 	 	 	Title:	Vice President	

EXHIBIT A
FORM OF 7.125 % SENIOR NOTES
 
[Insert the Private Placement Legend and/or the Global Security legend, as applicable]
 
7.125% SENIOR NOTES DUE 2037

No. [      ]	 	$[               ]      	
CUSIP No. [                 ]
 
TYCO ELECTRONICS GROUP S.A.
 
promises to pay to Cede & Co. or registered assigns, the principal sum of [              ] Dollars on [        ].
 
Interest Payment Dates: April 1 and October 1
 
Record Dates:  March 16 and September 15
 
Each holder of this Security (as defined below), by accepting the same, agrees to and shall be bound by the provisions hereof and of the Indenture described herein, and authorizes and directs the Trustee described herein on such holder’s behalf to be bound by such provisions.  Each holder of this Security hereby waives all notice of the acceptance of the provisions contained herein and in the Indenture and waives reliance by such holder upon said provisions.
 
This Security shall not be entitled to any benefit under the Indenture, or be valid or become obligatory for any purpose, until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee.  The provisions of this Security are continued on the reverse side hereof, and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.
 
IN WITNESS WHEREOF, the Company has caused this instrument to be signed in accordance with Section 2.04 of the Indenture.
 
Date:  [        ]

 	TYCO ELECTRONICS GROUP S.A.	

 	Name:	
 	Title:	
 	 	
 	[If second signature is applicable:]	

 	Name:	
 	Title:	
 
A-1

 
CERTIFICATE OF AUTHENTICATION
 
This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 	DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Trustee	
 	 	
 	By:	 	 	
 	 	Authorized Signatory	
 	 	
 	By:	 	 	
 	 	Authorized Signatory	
 	 	
 	Dated:	[        ]	
 
A-2

 
GUARANTEE
 
For value received, TYCO ELECTRONICS LTD. hereby absolutely, unconditionally and irrevocably guarantees to the holder of this Security the payment of principal of, premium, if any, and interest on, the Security upon which this Guarantee is set forth in the amounts and at the time when due and payable whether by declaration thereof or otherwise, and interest on the overdue principal and interest, if any, of such Security, if lawful, to the holder of such Security and the Trustee on behalf of the holders, all in accordance with and subject to the terms and limitations of such Security and Article XV of the Indenture.  This Guarantee will not become effective until the Trustee or Authenticating Agent duly executes the certificate of authentication on this Security.  This Guarantee shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of law principles thereof.

Dated: [        ]	 	
 	 	
 	TYCO ELECTRONICS LTD.	

 	By:	 	 	
 	 	  Name:	
 	 	  Title:	
 
A-3

 
Tyco Electronics Group S.A.
 
7.125 % Senior Notes due 2037
 
This security is one of a duly authorized series of debt securities of Tyco Electronics Group S.A., a Luxembourg company (the “Company”), issued or to be issued in one or more series under and pursuant to an Indenture for the Company’s unsubordinated debt securities, dated as of September 25, 2007 (the “Base Indenture”), duly executed and delivered by and among the Company, Tyco Electronics Ltd. (“Parent”) and Deutsche Bank Trust Company Americas (the “Trustee”), as supplemented by the Third Supplemental Indenture, dated as of September 25, 2007 (the “Third Supplemental Indenture”), by and among the Company, Parent and the Trustee.  The Base Indenture as supplemented and amended by the Third Supplemental Indenture is referred to herein as the “Indenture.”  By the terms of the Base Indenture, the debt securities issuable thereunder are issuable in series that may vary as to amount, date of maturity, rate of interest and in other respects as provided in the Base Indenture.  This security is one of the series designated on the face hereof (individually, a “Security,” and collectively, the “Securities”), and reference is hereby made to the Indenture for a description of the rights, limitations of rights, obligations, duties and immunities of the Trustee, the Company, Parent and the holders of the Securities (the “Securityholders”).  Capitalized terms used herein and not otherwise defined shall have the meanings given them in the Base Indenture or the Third Supplemental Indenture, as applicable.
 
1.   Interest .  The Company promises to pay interest on the principal amount of this Security at an annual rate of 7.125%, subject to adjustment as provided below.  The Company will pay interest semi-annually on April 1 and October 1 of each year (each such day, an “Interest Payment Date”).  If any Interest Payment Date, redemption date or maturity date of this Security is not a Business Day, then payment of interest or principal (and premium, if any) shall be made on the next succeeding Business Day with the same force and effect as if made on the date such payment was due, and no interest shall accrue for the period after such date to the next succeeding Business Day.  Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from the date of issuance; provided that, if there is no existing Default in the payment of interest, and if this Security is authenticated between a regular record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; and provided, further, that the first Interest Payment Date shall be [        ].  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  In certain circumstances, liquidated damages may be payable as provided in Section 6.01 of the Indenture.  Any such liquidated damages shall be payable in the same manner and on the same dates as the stated interest payable on this Security.
 
The interest rate payable on this Security shall be subject to adjustments from time to time if Moody’s, S&P or Fitch downgrades (or subsequently upgrades) the debt rating assigned to this Security as set forth in Section 1.1(4)(B) of the Indenture.
 
The Holder of this Security is entitled to the benefits of the Exchange and Registration Rights Agreement.  Pursuant to the Exchange and Registration Rights Agreement, the Company
 
A-4

 
has agreed (i) to file the Exchange Registration Statement (as defined in the Exchange and Registration Rights Agreement) as soon as practicable, but no later than 210 days after the Closing Date (as defined in the Exchange and Registration Rights Agreement), (ii) to use its commercially reasonable efforts to cause such Exchange Registration Statement to become effective under the Securities Act as soon as practicable, but no later than 300 days after the Closing Date, and (iii) to use its commercially reasonable efforts to commence and complete the Exchange Offer (as defined in the Exchange and Registration Rights Agreement) promptly, but no later than 45 days after such registration statement has become effective, hold the Exchange Offer open for at least 30 days and exchange Exchange Securities (as defined in the Exchange and Registration Rights Agreement) for all Registrable Securities (as defined in the Exchange and Registration Rights Agreement) that have been properly tendered and not withdrawn on or prior to the expiration of the Exchange Offer.  If (i) on or prior to the time the Exchange Offer is completed existing SEC interpretations are changed such that debt securities or the related guarantee received by holders other than Restricted Holders (as defined in the Exchange and Registration Rights Agreement) in the Exchange Offer for Registrable Securities (as defined in the Exchange and Registration Rights Agreement) are not or would not be, upon receipt, transferable by each such holder without restriction under the Securities Act, (ii) the Exchange Offer is not completed within 345 days after the Closing Date or (iii) the Exchange Offer is not available to any Holder, then, in each case, the Company is required to (a) as soon as practicable but no later than 60 days after the time such obligation to file arises, file a Shelf Registration Statement (as defined in the Exchange and Registration Rights Agreement) and (b) use its commercially reasonable best efforts to cause the Shelf Registration Statement to become or be declared effective within 120 days after such Shelf Registration Statement is filed and to keep such Shelf Registration Statement continuously effective until the earlier of two years after the date as of which the Shelf Registration Statement became or was declared effective or such time as there are no longer any Registrable Securities outstanding.  If (i) the Company fails to file the Exchange Registration Statement or the Shelf Registration Statement on or before the date specified for such filing, (ii) any of the Exchange Registration Statement or the Shelf Registration Statement is not declared effective by the date specified for such effectiveness, (iii) the Company fails to complete the Exchange Offer within 45 after the effectiveness target date with respect to the Exchange Registration Statement, (iv) any of the Exchange Registration Statement or the Shelf Registration Statement is declared effective but thereafter is withdrawn or ceases to be effective due to a stop order issued pursuant to the Securities Act suspending the effectiveness of such registration statement without being succeeded by an additional registration statement filed and declared effective or (v) the Company requires Holders to refrain from disposing of their Registrable Securities under certain circumstances described in the Exchange and Registration Rights Agreement and that suspension period exceeds 45 days in any one instance or 90 days in the aggregate during any consecutive 12 month period (each such event referred to in clauses (i) through (v), a “Registration Default” and each period during which a Registration Default has occurred and is continuing, a “Registration Default Period”), then, as liquidated damages for such Registration Default, subject to certain exceptions, special interest (“Special Interest”) shall accrue at a per annum rate of 0.25% for the first 90 days of the Registration Default Period and at a per annum rate of 0.50% thereafter for the remaining portion of the Registration Default Period.
 
2.   Method of Payment .  The Company will pay interest on the Securities (except defaulted interest), if any, to the persons in whose name such Securities are registered at the
 
A-5

 
close of business on the regular record date referred to on the facing page of this Security for such interest installment.  In the event that the Securities or a portion thereof are called for redemption and the Redemption Date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Securities will be paid upon presentation and surrender of such Securities as provided in the Indenture.  The principal of and the interest on the Securities shall be payable in the coin or currency of the United States of America that at the time is legal tender for public and private debt, at the office or agency of the Company maintained for that purpose in accordance with the Indenture.
 
3.   Paying Agent and Registrar .  Initially, Deutsche Bank Trust Company Americas, the Trustee, will act as paying agent and Security Registrar.  The Company may change or appoint any paying agent or Security Registrar without notice to any Securityholder.  Parent, the Company or any of their Subsidiaries may act in any such capacity.
 
4.   Indenture .  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (“TIA”) as in effect on the date the Indenture is qualified.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and TIA for a statement of such terms.  The Securities are unsecured general obligations of the Company and constitute the series designated on the face hereof as the “7.125% Senior Notes due 2037”, initially limited to $500,000,000 in aggregate principal amount.  The Company will furnish to any Securityholder upon written request and without charge a copy of the Base Indenture and the Third Supplemental Indenture.  Requests may be made to: Tyco Electronics Group S.A., 17, boulevard Grande-Duchesse Charlotte, L-1331 Luxembourg, Attention: The Managing Directors.
 
5.   Optional Redemption .  The Securities will be subject to redemption at the option of the Company on any date prior to the maturity date, in whole or from time to time in part, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), on written notice given to the Securityholders thereof not less than 30 days nor more than 90 days prior to the date fixed for redemption in such notice (the “Redemption Date”), at a redemption price equal to the greater of (i) 100% of the principal amount of such Securities to be redeemed and (ii) as determined by the Quotation Agent and delivered to the Trustee, the sum of the present values of the remaining scheduled payments of principal and interest thereon due on any date after the Redemption Date (based on the Original Interest Rate and excluding the portion of interest that will be accrued and unpaid to and including the Redemption Date) discounted from their scheduled date of payment to the Redemption Date (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Redemption Treasury Rate plus 35 basis points (such greater amount is referred to herein as the “Redemption Price”), plus, in either the case of clause (i) or clause (ii), accrued and unpaid interest and Special Interest, if any, thereon to the Redemption Date.  This Security is also subject to redemption to the extent provided in Article XIV of the Indenture.
 
If the giving of the notice of redemption is completed as provided in the Indenture, interest on such Securities or portions of Securities shall cease to accrue on and after the Redemption Date, unless the Company shall default in the payment of such Redemption Price and accrued interest with respect to any such Security or portion thereof.
 
A-6

 
The Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Securities.
 
6.   Change of Control Triggering Event .  Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem this Security, the holder of this Security will have the right to require that the Company purchase all or a portion, in $1,000 increments ( provided that any remaining principal amount thereof shall be at least the minimum authorized denomination thereof), of this Security at a purchase price equal to 101% of the principal amount hereof plus accrued and unpaid interest, if any, to the date of purchase.  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 Change of Control, the Company shall send, by first class mail, a notice to each Holder, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer.
 
7.   Denominations, Transfer, Exchange .  The Securities are in registered form without coupons in the denominations of $2,000 or any integral multiple of $1,000 in excess thereof.  The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture.  The Securities may be presented for exchange or for registration of transfer (duly endorsed or with the form of transfer endorsed thereon duly executed if so required by the Company or the Security Registrar) at the office of the Security Registrar or at the office of any transfer agent designated by the Company for such purpose.  No service charge will be made for any registration of transfer or exchange, but a Securityholder may be required to pay any applicable taxes or other governmental charges.  If the Securities are to be redeemed, the Company will not be required to:  (i) issue, register the transfer of, or exchange any Security during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of less than all of the outstanding Securities of the same series and ending at the close of business on the day of such mailing; (ii) register the transfer of or exchange any Security of any series or portions thereof selected for redemption, in whole or in part, except the unredeemed portion of any such Security being redeemed in part; nor (iii) register the transfer of or exchange a Security of any series between the applicable record date and the next succeeding Interest Payment Date.
 
8.   Persons Deemed Owners .  The registered Securityholder may be treated as its owner for all purposes.
 
9.   Repayment to Parent or the Company .  Any funds or Governmental Obligations deposited with any paying agent or the Trustee, or then held by Parent or the Company, in trust for payment of principal of, premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least one year after the date upon which the principal of, premium, if any, or interest on such Securities shall have respectively become due and payable, shall be repaid to Parent or the Company, as applicable, or (if then held by Parent or the Company) shall be discharged from such trust.  After return to the Company or Parent, Holders entitled to the money or securities must look to the Company or Parent, as applicable, for payment as unsecured general creditors.
 
10.   Amendments, Supplements and Waivers .  The Base Indenture contains provisions permitting the Company, Parent and the Trustee, with the consent of the holders of not less than
 
A-7

 
a majority in aggregate principal amount of the Outstanding Securities to enter into supplemental indentures for the purpose of adding, changing or eliminating any provisions to the Base Indenture or supplemental indenture or indentures or of modifying in any manner not covered elsewhere in the Base Indenture the rights of the holders of the Securities of such series; provided , however , that no such supplemental indenture, without the consent of the holders of each Security then Outstanding and affected thereby, shall:  (i) extend a fixed maturity of or any installment of principal of any Securities of any series or reduce the principal amount thereof, or reduce the amount of principal of any original issue discount security that would be due and payable upon declaration of acceleration of the maturity thereof; (ii) reduce the rate of or extend the time for payment of interest of any Security of any series; (iii) reduce the premium payable upon the redemption of any Security; (iv) make any Security payable in Currency other than that stated in the Security; (v) impair the right to institute suit for the enforcement of any payment on or after the fixed maturity thereof (or in the case or redemption, on or after the redemption date); or (vi) reduce the percentage of Securities, the holders of which are required to consent to any such supplemental indenture or indentures.  The Base Indenture also contains provisions permitting the holders of not less than a majority in aggregate principal amount of the Outstanding securities of each series affected thereby, on behalf of all of the holders of the securities of such series, to waive any past Default under the Base Indenture, and its consequences, except a Default in the payment of the principal of, premium, if any, or interest on any security of such series or a Default in respect of a covenant or provision of the Base Indenture that cannot be modified or amended without the consent of the holder of each Outstanding security of such affected series.  Any such consent or waiver by the registered Securityholder shall be conclusive and binding upon such holder and upon all future holders and owners of this Security and of any Security issued in exchange for this Security or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Security.
 
11.   Defaults and Remedies .  If an Event of Default with respect to the securities of a series issued pursuant to the Base Indenture occurs and is continuing, the Trustee or the holders of at least 25% in aggregate principal amount of the Securities of such series then Outstanding, by notice in writing to the Company and Parent (and to the Trustee if notice is given by such holders), may declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately.  Subject to the terms of the Indenture, if an Event of Default under the Indenture shall occur and be continuing, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the holders, unless such holders have offered the Trustee indemnity satisfactory to it.  Upon satisfaction of certain conditions set forth in the Indenture, the holders of a majority in principal amount of the Outstanding securities of a series issued pursuant to the Base Indenture will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the securities of such series.
 
12.   Trustee, Paying Agent and Security Registrar May Hold Securities .  The Trustee, subject to certain limitations imposed by the TIA, or any paying agent or Security Registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, paying agent or Security Registrar.
 
A-8

 
13.   No Recourse Against Others .  No recourse under or upon any obligation, covenant or agreement of the Indenture, or of any Security, or for any claim based thereon or otherwise in respect hereof or thereof, shall be had against any incorporator, stockholder, officer or director, past, present or future as such, of Parent or the Company or of any predecessor or successor corporation, either directly or through Parent or the Company or any such predecessor or 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 the Indenture and the obligations issued hereunder and thereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, shareholders, officers or directors as such, of Parent or the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, shareholder, officer or director as such, because of the creation of the indebtedness authorized by the Indenture, or under or by reason of the obligations, covenants or agreements contained in the Indenture or in the Securities or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the acceptance of the Securities.
 
14.   Discharge of Indenture .  The Indenture contains certain provisions pertaining to defeasance, which provisions shall for all purposes have the same effect as if set forth herein.
 
15.   Authentication .  This Security shall not be valid until the Trustee signs the certificate of authentication attached to the other side of this Security.
 
16.   Guarantees .  All payments by the Company under the Indenture and this Security are fully and unconditionally guaranteed to the holder of this Security by Parent, as provided in the related Guarantee and the Indenture.
 
17.   Additional Amounts .  The Company and Parent are obligated to pay Additional Amounts on this Security to the extent provided in Article XIV of the Indenture.
 
18.   Abbreviations .  Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
 
19.   Governing Law .  The Base Indenture, the Third Supplemental Indenture and this Security (and the Guarantee hereon) shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State.
 
A-9

 
ASSIGNMENT FORM
 
To assign this Security, fill in the form below: (I) or (we) assign and transfer this Security to

(Insert assignee’s soc. sec. or tax I.D. no.)

 
 
(Print or type assignee’s name, address and zip code)
 
and irrevocably appoint
agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.

Date:	 	 	 	
 	 	
 	Your Signature:	 	 	
 	(Sign exactly as your name appears on the face of this
Security)	

Signature Guarantee:	 	 	 	

A-10

 
OPTION OF HOLDER TO ELECT PURCHASE
 
If you want to elect to have this Security purchased by the Company pursuant to Section 1.3(3) of the Third Supplemental Indenture, check the box:
 
o   1.3(3) Change of Control Triggering Event
 
If you want to elect to have only part of this Security purchased by the Company pursuant to Section 1.3(3) of the Third Supplemental Indenture, state the amount:  $                      .

 	Date: 	 	 	   Your Signature:	
 	(Sign exactly as your name appears	
 	on the other side of the Security)	

Tax I.D. number	
 	 	
Signature Guarantee:	 	 	 	
 	(Signature must be guaranteed by a
participant in a recognized signature
guarantee medallion program)	 	 	

EXHIBIT 4.2
 
Tyco Electronics Group S.A.
 
U.S. $800,000,000 6.000% Senior Notes due 2012
U.S. $750,000,000 6.550% Senior Notes due 2017
U.S. $500,000,000 7.125% Senior Notes due 2037
 
Fully and unconditionally guaranteed as to the
payment of principal, premium,
if any, and interest by
 
Tyco Electronics Ltd.
Exchange and Registration Rights Agreement
 
September 25, 2007
 
Goldman, Sachs & Co.,
UBS Securities LLC
As representatives of the several Purchasers
named in Schedule I to the Purchase Agreement
 
c/o Goldman, Sachs & Co.
85 Broad Street,
New York, New York 10004.
 
Ladies and Gentlemen:
 
Tyco Electronics Group S.A. , a Luxembourg public limited liability company (the “Company”), proposes to issue and sell to the Purchasers (as defined herein) upon the terms set forth in the Purchase Agreement (as defined herein) its U.S $800,000,000 6.000% Senior Notes due 2012, U.S. $750,000,000 6.550% Senior Notes due 2017 and U.S $500,000,000 7.125% Senior Notes due 2037 , which are fully and unconditionally guaranteed as to the payment of principal, premium, if any, and interest by Tyco Electronics Ltd. (the “Guarantor”). As an inducement to the Purchasers to enter into the Purchase Agreement and in satisfaction of a condition to the obligations of the Purchasers thereunder, the Company and the Guarantor agree with the Purchasers for the benefit of holders (as defined herein) from time to time of the Registrable Securities (as defined herein) as follows:
 
1.              Certain Definitions .  For purposes of this Exchange and Registration Rights Agreement, the following terms shall have the following respective meanings:

 
“Base Interest” shall mean the interest that would otherwise accrue on the Securities under the terms thereof and the Indenture, without giving effect to the provisions of this Agreement.
 
The term “broker-dealer” shall mean any broker or dealer registered with the Commission under the Exchange Act.
 
“Closing Date” shall mean the date on which the Securities are initially issued.
 
“Commission” shall mean the United States Securities and Exchange Commission, or any other federal agency at the time administering the Exchange Act or the Securities Act, whichever is the relevant statute for the particular purpose.
 
“Effective Time,” in the case of (i) an Exchange Registration, shall mean the time and date as of which the Commission declares the Exchange Registration Statement effective or as of which the Exchange Registration Statement otherwise becomes effective and (ii) a Shelf Registration, shall mean the time and date as of which the Commission declares the Shelf Registration Statement effective or as of which the Shelf Registration Statement otherwise becomes effective.
 
“Electing Holder” shall mean any holder of Registrable Securities that has returned a completed and signed Notice and Questionnaire to the Company in accordance with Section 3(d)(ii) or 3(d)(iii) hereof.
 
“Exchange Act” shall mean the Securities Exchange Act of 1934, or any successor thereto, as the same shall be amended from time to time.
 
“Exchange Offer” shall have the meaning assigned thereto in Section 2(a) hereof.
 
“Exchange Registration” shall have the meaning assigned thereto in Section 3(c) hereof.
 
“Exchange Registration Statement” shall have the meaning assigned thereto in Section 2(a) hereof.
 
“Exchange Securities” shall have the meaning assigned thereto in Section 2(a) hereof.
 
“ Free Writing Prospectus ” means each free writing prospectus (as defined in Rule 405 under the Securities Act) prepared by or on behalf of the Company or used or referred to by the Company in connection with the sale of the Securities or the Exchange Securities.
 
The term “holder” shall mean each of the Purchasers and other persons who acquire Registrable Securities from time to time (including any successors or assigns), in each case for so long as such person owns any Registrable Securities.
 
“Indenture” shall mean the Indenture, dated as of September 25, 2007, between the Company , the Guarantor and Deutsche Bank Trust Company Americas, as Trustee, as the same shall be amended from time to time.
 
“ Notice and Questionnaire ” means a Notice of Registration Statement and Selling Securityholder Questionnaire substantially in the form of Exhibit A hereto.
 
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The term “person” shall mean a corporation, association, partnership, organization, business, individual, government or political subdivision thereof or governmental agency.
 
“Purchase Agreement” shall mean the Purchase Agreement, dated as of September 20, 2007, between the Purchasers, the Guarantor and the Company relating to the Securities.
 
“Purchasers” shall mean the Purchasers named in Schedule I to the Purchase Agreement.
 
“Registrable Securities” shall mean the Securities; provided, however, that a Security shall cease to be a Registrable Security when (i) in the circumstances contemplated by Section 2(a) hereof, the Security has been exchanged for an Exchange Security in an Exchange Offer as contemplated in Section 2(a) hereof ( provided that any Exchange Security that, pursuant to the last two sentences of Section 2(a), is included in a prospectus for use in connection with resales by broker-dealers shall be deemed to be a Registrable Security with respect to Sections 5, 6 and 9 until resale of such Registrable Security has been effected within the Resale Period referred to in Section 2(a)); (ii) in the circumstances contemplated by Section 2(b) hereof, a Shelf Registration Statement registering such Security under the Securities Act has been declared or becomes effective and such Security has been sold or otherwise transferred by the holder thereof pursuant to and in a manner contemplated by such effective Shelf Registration Statement; (iii) such Security is sold pursuant to Rule 144 under circumstances in which any legend borne by such Security relating to restrictions on transferability thereof, under the Securities Act or otherwise, is removed by the Company or pursuant to the Indenture; (iv) such Security is eligible to be sold pursuant to paragraph (k) of Rule 144 (or such earlier time that such Security is freely saleable); or (v) such Security shall cease to be outstanding.
 
“Registration Default” shall have the meaning assigned thereto in Section 2(c) hereof.
 
“Registration Expenses” shall have the meaning assigned thereto in Section 4 hereof.
 
“Resale Period” shall have the meaning assigned thereto in Section 2(a) hereof.
 
“Restricted Holder” shall mean (i) a holder that is an affiliate of the Company within the meaning of Rule 405, (ii) a holder who acquires Exchange Securities outside the ordinary course of such holder’s business, (iii) a holder who has arrangements or understandings with any person to participate in the Exchange Offer for the purpose of distributing Exchange Securities and (iv) a holder that is a broker-dealer, but only with respect to Exchange Securities received by such broker-dealer pursuant to an Exchange Offer in exchange for Registrable Securities acquired by the broker-dealer directly from the Company.
 
“Rule 144,” “Rule 405” and “Rule 415” shall mean, in each case, such rule promulgated under the Securities Act (or any successor provision), as the same shall be amended from time to time.
 
“Securities” shall mean, collectively, the U.S. $800,000,000 6.000% Senior Notes due 2012 , the U.S. $750,000,000 6.550% Notes due 2017 and the U.S. $500,000,000 7.125% Notes due 2037 of the Company to be issued and sold to the Purchasers, and securities issued in exchange therefor or in lieu thereof pursuant to the Indenture. Each Security is entitled to the benefit of the guarantee provided for in the Indenture (the “Guarantee”) and,
 
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unless the context otherwise requires, any reference herein to a “Security,” an “Exchange Security” or a “Registrable Security” shall include a reference to the related Guarantee.
 
“Securities Act” shall mean the Securities Act of 1933, or any successor thereto, as the same shall be amended from time to time.
 
“Shelf Registration” shall have the meaning assigned thereto in Section 2(b) hereof.
 
“Shelf Registration Statement” shall have the meaning assigned thereto in Section 2(b) hereof.
 
“Special Interest” shall have the meaning assigned thereto in Section 2(c) hereof.
 
“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, or any successor thereto, and the rules, regulations and forms promulgated thereunder, all as the same shall be amended from time to time.
 
Unless the context otherwise requires, any reference herein to a “Section” or “clause” refers to a Section or clause, as the case may be, of this Exchange and Registration Rights Agreement, and the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Exchange and Registration Rights Agreement as a whole and not to any particular Section or other subdivision.
 
2.    Registration Under the Securities Act .
 
(a)    Except as set forth in Section 2(b) below, the Company agrees to file under the Securities Act, as soon as practicable, but no later than 210 days after the Closing Date, a registration statement relating to an offer to exchange (such registration statement, the “Exchange Registration Statement”, and such offer, the “Exchange Offer”) any and all of the Securities for a like aggregate principal amount of debt securities issued by the Company and guaranteed by the Guarantor, which debt securities and guarantee are substantially identical to the Securities and the related Guarantee, respectively (and are entitled to the benefits of a trust indenture which is substantially identical to the Indenture or is the Indenture and which has been qualified under the Trust Indenture Act), except that they have been registered pursuant to an effective registration statement under the Securities Act and do not contain provisions for the additional interest contemplated in Section 2(c) below (such new debt securities hereinafter called “Exchange Securities”). The Company agrees to use its commercially reasonable efforts to cause the Exchange Registration Statement to become effective under the Securities Act as soon as practicable, but no later than 300 days after the Closing Date. The Exchange Offer will be registered under the Securities Act on the appropriate form and will comply with all applicable tender offer rules and regulations under the Exchange Act. The Company further agrees to use its commercially reasonable efforts to commence and complete the Exchange Offer promptly, but no later than 45 days after such registration statement has become effective, hold the Exchange Offer open for at least 30 days and exchange Exchange Securities for all Registrable Securities that have been properly tendered and not withdrawn on or prior to the expiration of the Exchange Offer. The Exchange Offer will be deemed to have been “completed” only if the debt securities and related guarantee received by holders other than Restricted Holders in the Exchange Offer for Registrable Securities are, upon receipt, transferable by each such holder without restriction under the Securities Act and the Exchange Act and without material restrictions under the blue sky or securities laws of a
 
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substantial majority of the States of the United States of America. The Exchange Offer shall be deemed to have been completed upon the earlier to occur of (i) the Company having exchanged the Exchange Securities for all outstanding Registrable Securities pursuant to the Exchange Offer and (ii) the Company having exchanged, pursuant to the Exchange Offer, Exchange Securities for all Registrable Securities that have been properly tendered and not withdrawn before the expiration of the Exchange Offer, which shall be on a date that is at least 30 days following the commencement of the Exchange Offer. The Company agrees (x) to include in the Exchange Registration Statement a prospectus for use in any resales by any holder of Exchange Securities that is a broker-dealer and (y) to keep such Exchange Registration Statement effective for a period (the “Resale Period”) beginning when Exchange Securities are first issued in the Exchange Offer and ending upon the earlier of the expiration of the 180th day after the Exchange Offer has been completed or such time as such broker-dealers no longer own any Registrable Securities. With respect to such Exchange Registration Statement, each such holder shall have the benefit of the rights of indemnification and contribution set forth in Sections 6(a), (c), (d) and (e) hereof.
 
(b)    If (i) on or prior to the time the Exchange Offer is completed existing Commission interpretations are changed such that the debt securities or the related guarantee received by holders other than Restricted Holders in the Exchange Offer for Registrable Securities are not or would not be, upon receipt, transferable by each such holder without restriction under the Securities Act, (ii) the Exchange Offer has not been completed within 345 days following the Closing Date or (iii) the Exchange Offer is not available to any holder of the Securities, the Company shall, in lieu of (or, in the case of clause (iii), in addition to) conducting the Exchange Offer contemplated by Section 2(a), file under the Securities Act as soon as practicable, but no later than the later of 60 days after the time such obligation to file arises, a “shelf” registration statement providing for the registration of, and the sale on a continuous or delayed basis by the holders of, all of the Registrable Securities, pursuant to Rule 415 or any similar rule that may be adopted by the Commission (such filing, the “Shelf Registration” and such registration statement, the “Shelf Registration Statement”). The Company agrees to use its commercially reasonable efforts (x) to cause the Shelf Registration Statement to become or be declared effective no later than 120 days after such Shelf Registration Statement is filed and to keep such Shelf Registration Statement continuously effective for a period ending on the earlier of the second anniversary of the Effective Time or such time as there are no longer any Registrable Securities outstanding, provided , however , that no holder shall be entitled to be named as a selling securityholder in the Shelf Registration Statement or to use the prospectus forming a part thereof for resales of Registrable Securities unless such holder is an Electing Holder, and (y) after the Effective Time of the Shelf Registration Statement, promptly upon the request of any holder of Registrable Securities that is not then an Electing Holder, to take any action reasonably necessary to enable such holder to use the prospectus forming a part thereof for resales of Registrable Securities, including, without limitation, any action necessary to identify such holder as a selling securityholder in the Shelf Registration Statement, provided, however, that nothing in this Clause (y) shall relieve any such holder of the obligation to return a completed and signed Notice and Questionnaire to the Company in accordance with Section 3(d)(iii) hereof. The Company further agrees to supplement or make amendments to the Shelf Registration Statement, as and when required by the rules, regulations or instructions applicable to the registration form used by the Company for such Shelf Registration Statement or by the Securities Act or rules and regulations thereunder for shelf registration, and the Company agrees to furnish to each Electing Holder copies of any such supplement or amendment prior to its being used or promptly following its filing with the
 
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Commission. The Company’s obligation to file a Shelf Registration Statement under clauses (i) of this Section 2(b), to cause such Shelf Registration Statement to become and remain effective and to comply with its other undertakings in this Section 2(b) shall terminate upon the completion of the Exchange Offer pursuant to Section 2(a).
 
(c)    In the event that (i) the Company has not filed the Exchange Registration Statement or Shelf Registration Statement on or before the date on which such registration statement is required to be filed pursuant to Section 2(a) or 2(b), respectively, or (ii) such Exchange Registration Statement or Shelf Registration Statement has not become effective or been declared effective by the Commission on or before the date on which such registration statement is required to become or be declared effective pursuant to Section 2(a) or 2(b), respectively, or (iii) the Exchange Offer has not been completed within 45 days after the initial effective date of the Exchange Registration Statement relating to the Exchange Offer (if the Exchange Offer is then required to be made), or (iv) any Exchange Registration Statement or Shelf Registration Statement required by Section 2(a) or 2(b) hereof is filed and declared effective but shall thereafter either be withdrawn by the Company or shall become subject to an effective stop order issued pursuant to Section 8(d) of the Securities Act suspending the effectiveness of such registration statement (except as specifically permitted herein) without being succeeded immediately by an additional registration statement filed and declared effective; or (v) the Company requires Holders to refrain from disposing of their Registrable Securities due to a Suspension Event (as defined in Section 3(i)) to the extent that such period exceeds 45 days in any one instance or 90 days in the aggregate during any consecutive 12-month period (a “Suspension Period”) (each such event referred to in clauses (i) through (iv), a “Registration Default” and each period during which a Registration Default has occurred and is continuing, a “Registration Default Period”), then, as liquidated damages for such Registration Default, subject to the provisions of Section 9(b), special interest (“Special Interest”), in addition to the Base Interest, shall accrue at a per annum rate of 0.25% for the first 90 days of the Registration Default Period, at a per annum rate of 0.50% thereafter for the remaining portion of the Registration Default Period.
 
(d)    The Company and the Guarantor shall take all actions necessary or advisable to be taken by them to ensure that the transactions contemplated herein are effected as so contemplated, including all actions necessary or desirable to register the Guarantee under the registration statement contemplated in Section 2(a) or 2(b) hereof, as applicable.
 
(e)    Any reference herein, other than any such reference in Sections 3(d)(vi) and (vii), to a registration statement as of any time shall be deemed to include any document incorporated, or deemed to be incorporated, therein by reference as of such time and any reference herein, other than any such reference in Sections 3(d)(vi) and (vii), to any post-effective amendment to a registration statement as of any time shall be deemed to include any document incorporated, or deemed to be incorporated, therein by reference as of such time.
 
3.     Registration Procedures .
 
If the Company and the Guarantor file a registration statement pursuant to Section 2(a) or Section 2(b), the following provisions shall apply:
 
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(a)            At or before the Effective Time of the Exchange Offer or the Shelf Registration, as the case may be, the Company shall qualify the Indenture under the Trust Indenture Act of 1939.
 
(b)            In the event that such qualification would require the appointment of a new trustee under the Indenture, the Company shall appoint a new trustee thereunder pursuant to the applicable provisions of the Indenture.
 
(c)            In connection with the obligations of the Company and the Guarantor with respect to the registration of Exchange Securities as contemplated by Section 2(a) (the “Exchange Registration”), if applicable, the Company shall, as soon as practicable (or as otherwise specified):
 
(i)             prepare and file with the Commission, as soon as practicable but no later than 210 days after the Closing Date, an Exchange Registration Statement on any form which may be utilized by the Company and which shall permit the Exchange Offer and resales of Exchange Securities by broker-dealers during the Resale Period to be effected as contemplated by Section 2(a), and use its commercially reasonable efforts to cause such Exchange Registration Statement to become effective as soon as practicable thereafter, but no later than 300 days after the Closing Date;
 
(ii)            subject to the provisions of Section 3(i), as soon as practicable prepare and file with the Commission such amendments and supplements to such Exchange Registration Statement and the prospectus included therein as may be necessary to effect and maintain the effectiveness of such Exchange Registration Statement for the periods and purposes contemplated in Section 2(a) hereof and as may be required by the applicable rules and regulations of the Commission and the instructions applicable to the form of such Exchange Registration Statement, and promptly provide each broker-dealer holding Exchange Securities with such number of copies of the prospectus included therein (as then amended or supplemented), in conformity in all material respects with the requirements of the Securities Act and the Trust Indenture Act and the rules and regulations of the Commission thereunder, as such broker-dealer reasonably may request prior to the expiration of the Resale Period, for use in connection with resales of Exchange Securities;
 
(iii)           promptly notify each broker-dealer that has requested or received copies of the prospectus included in such registration statement, and confirm such advice in writing, (A) when such Exchange Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to such Exchange Registration Statement or any post-effective amendment, when the same has become effective, (B) of the issuance by the Commission of any stop order suspending the effectiveness of such Exchange Registration Statement or the initiation or threatening of any proceedings for that purpose, or (C) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Exchange Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose ;
 
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(iv)           use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of such Exchange Registration Statement or any post-effective amendment thereto at the earliest practicable date;
 
(v)            use its commercially reasonable efforts to (A) register or qualify the Exchange Securities under the securities laws or blue sky laws of such jurisdictions as are contemplated by Section 2(a) no later than the commencement of the Exchange Offer, (B) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions until the expiration of the Resale Period and (C) take any and all other actions as may be reasonably necessary or advisable to enable each broker-dealer holding Exchange Securities to consummate the disposition thereof in such jurisdictions; provided, however, that neither the Company nor the Guarantor shall be required for any such purpose to (1) qualify as a foreign corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements of this Section 3(c)(vi), (2) consent to general service of process in any such jurisdiction or (3) make any changes to its certificate of incorporation, by-laws or similar organizational document or any agreement between it and its stockholders;
 
(vi)           use its commercially reasonable efforts to obtain the consent or approval of each governmental agency or authority, whether federal, state or local, which may be required to effect the Exchange Registration, the Exchange Offer and the offering and sale of Exchange Securities by broker-dealers during the Resale Period;
 
(vii)          provide a CUSIP number for each series of Exchange Securities, not later than the applicable Effective Time;
 
(viii)         comply with all applicable rules and regulations of the Commission, and make generally available to its securityholders as soon as practicable but no later than eighteen months after the effective date of such Exchange Registration Statement, an earning statement of the Guarantor and its subsidiaries complying with Section 11(a) of the Securities Act (including, at the option of the Guarantor, Rule 158 thereunder).
 
(d)            In connection with the obligations of the Company and the Guarantor with respect to the Shelf Registration, if applicable, as contemplated by Section 2(b)   the Company shall, as soon as practicable (or as otherwise specified):
 
(i)             prepare and file with the Commission, as soon as practicable but in any case within the time periods specified in Section 2(b), a Shelf Registration Statement on any form which may be utilized by the Company and which shall register all of the Registrable Securities for resale by the holders thereof in accordance with such method or methods of disposition as may be specified by such of the holders as, from time to time, may be Electing Holders and use its commercially reasonable efforts to cause such Shelf Registration Statement to become effective as soon as practicable but in any case within the time periods specified in Section 2(b);
 
(ii)            not less than 30 calendar days prior to the Effective Time of the Shelf Registration Statement, mail the Notice and Questionnaire to the holders of Registrable Securities; no holder shall be entitled to be named as a selling
 
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securityholder in the Shelf Registration Statement as of the Effective Time, and no holder shall be entitled to use the prospectus forming a part thereof for resales of Registrable Securities at any time, unless such holder has returned a completed and signed Notice and Questionnaire to the Company by the deadline for response set forth therein; provided, however , holders of Registrable Securities shall have at least 28 calendar days from the date on which the Notice and Questionnaire is first mailed to such holders to return a completed and signed Notice and Questionnaire to the Company;
 
(iii)           after the Effective Time of the Shelf Registration Statement, upon the request of any holder of Registrable Securities that is not then an Electing Holder, promptly send a Notice and Questionnaire to such holder; provided that the Company shall not be required to take any action to name such holder as a selling securityholder in the Shelf Registration Statement or to enable such holder to use the prospectus forming a part thereof for resales of Registrable Securities until such holder has returned a completed and signed Notice and Questionnaire to the Company;
 
(iv)           subject to Section 3(i), as soon as practicable prepare and file with the Commission such amendments and supplements to such Shelf Registration Statement and the prospectus included therein as may be necessary to effect and maintain the effectiveness of such Shelf Registration Statement for the period specified in Section 2(b) hereof and as may be required by the applicable rules and regulations of the Commission and the instructions applicable to the form of such Shelf Registration Statement, and furnish to the Electing Holders copies of any such supplement or amendment simultaneously with or prior to its being used or filed with the Commission;
 
(v)            comply with the provisions of the Securities Act with respect to the disposition of all of the Registrable Securities covered by such Shelf Registration Statement in accordance with the intended methods of disposition by the Electing Holders provided for in such Shelf Registration Statement;
 
(vi)           provide (A) the Electing Holders, (B) the underwriters (which term, for purposes of this Exchange and Registration Rights Agreement, shall include a person deemed to be an underwriter within the meaning of Section 2(a)(11) of the Securities Act), if any, thereof, (C) any sales or placement agent therefor, (D) counsel for any such underwriter or agent and (E) not more than one counsel for all the Electing Holders the opportunity to participate in the preparation of such Shelf Registration Statement, each prospectus included therein or filed with the Commission and each amendment or supplement thereto;
 
(vii)          for a reasonable period prior to the filing of such Shelf Registration Statement, and throughout the period specified in Section 2(b), make available at reasonable times at the Guarantor’s principal place of business or such other reasonable place for inspection by the persons referred to in Section 3(d)(vi) who shall certify to the Guarantor that they have a current intention to sell the Registrable Securities pursuant to the Shelf Registration such financial and other information and books and records of the Guarantor, and cause the executive officers, counsel and independent certified public accountants of the Guarantor to respond to such inquiries, as shall be reasonably necessary to conduct a reasonable investigation
 
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within the meaning of Section 11 of the Securities Act; provided, however, that each such party shall agree in writing to maintain in confidence and not to disclose to any other person any such information or records or the responses to any such inquiries, until such time as (A) such information becomes a matter of public record (whether by virtue of its inclusion in such registration statement or otherwise), or (B) such person shall be required to disclose such information pursuant to a subpoena or order of any court or other governmental agency or body having jurisdiction over the matter (subject to the requirements of such order, and only after such person shall have given the Guarantor prompt prior written notice of such requirement), or (C) such information is set forth in such Shelf Registration Statement or the prospectus included therein or in an amendment to such Shelf Registration Statement or an amendment or supplement to such prospectus;
 
(viii)         promptly notify each of the Electing Holders, any sales or placement agent therefor and any underwriter thereof (which notification may be made through any managing underwriter that is a representative of such underwriter for such purpose) and confirm such advice in writing, (A) when such Shelf Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to such Shelf Registration Statement or any post-effective amendment, when the same has become effective, (B) of the issuance by the Commission of any stop order suspending the effectiveness of such Shelf Registration Statement or the initiation or threatening of any proceedings for that purpose, (C) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, or (D) if at any time when a prospectus is required to be delivered under the Securities Act,  that offers and sales of Exchange Securities should be suspended as provided in Section 3(i);
 
(ix)            use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of such registration statement or any post-effective amendment thereto at the earliest practicable date;
 
(x)             if requested by any managing underwriter or underwriters, any placement or sales agent or any Electing Holder, promptly incorporate in a prospectus supplement or post-effective amendment such information as is required by the applicable rules and regulations of the Commission and as such managing underwriter or underwriters, such agent or such Electing Holder specifies should be included therein relating to the terms of the sale of such Registrable Securities, including information with respect to the principal amount of Registrable Securities being sold by such Electing Holder or agent or to any underwriters, the name and description of such Electing Holder, agent or underwriter, the offering price of such Registrable Securities and any discount, commission or other compensation payable in respect thereof, the purchase price being paid therefor by such underwriters and with respect to any other terms of the offering of the Registrable Securities to be sold by such Electing Holder or agent or to such underwriters; and make all required filings of such prospectus supplement or post-effective amendment promptly after notification of the matters to be incorporated in such prospectus supplement or post-effective amendment;
 
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(xi)            furnish to each Electing Holder, each placement or sales agent, if any, therefor, each underwriter, if any, thereof and the respective counsel referred to in Section 3(d)(vi) a copy of such Shelf Registration Statement, each such amendment and supplement thereto (in each case including all exhibits thereto (in the case of an Electing Holder of Registrable Securities, upon request) and documents incorporated by reference therein) and such number of copies of such Shelf Registration Statement (excluding exhibits thereto and documents incorporated by reference therein unless specifically so requested by such Electing Holder, agent or underwriter, as the case may be) and of the prospectus included in such Shelf Registration Statement (including each preliminary prospectus and any summary prospectus), in conformity in all material respects with the applicable requirements of the Securities Act and the Trust Indenture Act and the rules and regulations of the Commission thereunder in order to facilitate the offering and disposition of the Registrable Securities owned by such Electing Holder, offered or sold by such agent or underwritten by such underwriter and to permit such Electing Holder, agent and underwriter to satisfy the prospectus delivery requirements of the Securities Act; and the Company, subject to Section 3(i), hereby consents to the use of such prospectus (including such preliminary and summary prospectus) and any amendment or supplement thereto by each such Electing Holder and by any such agent and underwriter, in each case in the form most recently provided to such person by the Company, in connection with the offering and sale of the Registrable Securities covered by the prospectus (including such preliminary and summary prospectus) or any supplement or amendment thereto;
 
(xii)           use commercially reasonable efforts to (A) register or qualify the Registrable Securities to be included in such Shelf Registration Statement under such securities laws or blue sky laws of such jurisdictions as any Electing Holder and each placement or sales agent, if any, therefor and underwriter, if any, thereof shall reasonably request, (B) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions during the period the Shelf Registration is required to remain effective under Section 2(b) and (C) take any and all other actions as may be reasonably necessary or advisable to enable each such Electing Holder, agent, if any, and underwriter, if any, to consummate the disposition in such jurisdictions of such Registrable Securities during the period the Shelf Registration is required to remain effective under Section 2(b); provided, however, that neither the Company nor the Guarantor shall be required for any such purpose to (1) qualify as a foreign corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements of this Section 3(d)(xii), (2) consent to general service of process in any such jurisdiction or (3) make any changes to its certificate of incorporation, by-laws or similar organizational document or any agreement between it and its stockholders;
 
(xiii)          use its commercially reasonable efforts to obtain the consent or approval of each governmental agency or authority, whether federal, state or local, which may be required to effect the Shelf Registration or the offering or sale in connection therewith or to enable the selling holder or holders to offer, or to consummate the disposition of, their Registrable Securities;
 
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(xiv)         unless any Registrable Securities shall be in book-entry only form, cooperate with the Electing Holders and the managing underwriters, if any, to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold, which certificates, if so required by any securities exchange upon which any Registrable Securities are listed, shall be penned, lithographed or engraved, or produced by any combination of such methods, on steel engraved borders, and which certificates shall not bear any restrictive legends; and, in the case of an underwritten offering, enable such Registrable Securities to be in such denominations and registered in such names as the managing underwriters may request at least two business days prior to any sale of the Registrable Securities, in each case as provided in the Indenture;
 
(xv)          provide a CUSIP number for each series of Registrable Securities, not later than the applicable Effective Time;
 
(xvi)         enter into underwriting agreements, engagement letters, agency agreements, “best efforts” underwriting agreements or similar agreements, as appropriate, including customary provisions relating to indemnification and contribution, and take such other actions in connection therewith as any Electing Holders aggregating at least 33% in aggregate principal amount of the Registrable Securities at the time outstanding shall request in order to expedite or facilitate the disposition of such Registrable Securities;
 
(xvii)        whether or not an agreement of the type referred to in Section 3(d)(xvi) hereof is entered into and whether or not any portion of the offering contemplated by the Shelf Registration is an underwritten offering or is made through a placement or sales agent or any other entity, (A) make such representations and warranties to any Electing Holder, placement agent or underwriter in form, substance and scope as are customarily made in connection with an offering of debt securities pursuant to any appropriate agreement or to a registration statement filed on the form applicable to the Shelf Registration; (B) obtain an opinion of counsel to the Company, addressed to any Electing Holder, placement agent or underwriter that shall confirm that Section 11 of the Securities Act provides that, in the event an action were to be brought against any such person under Section 11 of the Securities Act with respect to sales of Registrable Securities, such person would have available to it, among other things, a due diligence defense under Section 11 of the Securities Act, in customary form and covering such matters, of the type customarily covered by such an opinion, as such person may reasonably request, dated the effective date of such Shelf Registration Statement (or if such Shelf Registration Statement contemplates an underwritten offering of a part or all of the Registrable Securities, dated the date of the closing under the underwriting agreement relating thereto) (it being agreed that the matters to be covered by such opinion shall include the due authorization, execution and delivery of the relevant agreement of the type referred to in Section 3(d)(xvi) hereof; the due authorization, execution, authentication and issuance, and the validity and enforceability, of the Securities; and the absence of governmental approvals required to be obtained in connection with the Shelf Registration, the offering and sale of the Registrable Securities, this Exchange and Registration Rights Agreement or any agreement of the type referred to in Section 3(d)(xvi) hereof, except such approvals as may be required under state securities or blue sky laws;(C) obtain a letter from counsel to the Company, addressed to any Electing
 
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Holder, placement agent or underwriter that shall confirm that Section 11 of the Securities Act provides that, in the event an action were to be brought against any such person under Section 11 of the Securities Act with respect to sales of Registrable Securities, such person would have available to it, among other things, a due diligence defense under Section 11 of the Securities Act, to the effect that such Shelf Registration Statement appears on its face to comply as to form with the rules and regulations of the Commission relating to registration statements on such form, and, as of the date of the opinion, the absence from such Shelf Registration Statement and the prospectus included therein, as then amended or supplemented (in each case other than the financial statements and other financial information contained therein) of an untrue statement of a material fact or the omission to state therein a material fact necessary to make the statements therein not misleading (in the case of any such prospectus, in the light of the circumstances existing at the time)); (D) obtain a “cold comfort” letter or letters from the independent certified public accountants of the Company addressed to any Electing Holder, placement agent or underwriter that shall confirm that Section 11 of the Securities Act provides that, in the event an action were to be brought against any such person under Section 11 of the Securities Act with respect to sales of Registrable Securities, such person would have available to it, among other things, a due diligence defense under Section 11 of the Securities Act, dated (i) the effective date of such Shelf Registration Statement and (ii) the effective date of any prospectus supplement to the prospectus included in such Shelf Registration Statement or post-effective amendment to such Shelf Registration Statement which includes unaudited or audited financial statements as of a date or for a period subsequent to that of the latest such statements included in such prospectus (and, if such Shelf Registration Statement contemplates an underwritten offering pursuant to any prospectus supplement to the prospectus included in such Shelf Registration Statement or post-effective amendment to such Shelf Registration Statement which includes unaudited or audited financial statements as of a date or for a period subsequent to that of the latest such statements included in such prospectus, dated the date of the closing under the underwriting agreement relating thereto), such letter or letters to be in customary form and covering such matters of the type customarily covered by letters of such type; (E) deliver such documents and certificates, including officers’ certificates, as may be reasonably requested by any Electing Holder, placement agent or underwriter that shall confirm that Section 11 of the Securities Act provides that, in the event an action were to be brought against any such person under Section 11 of the Securities Act with respect to sales of Registrable Securities, such person would have available to it, among other things, a due diligence defense under Section 11 of the Securities Act, to evidence the accuracy of the representations and warranties made pursuant to clause (A) above or those contained in Section 5(a) hereof and the compliance with or satisfaction of any agreements or conditions contained in the underwriting agreement or other agreement entered into by the Company or the Guarantor; and (F) undertake such obligations relating to expense reimbursement, indemnification and contribution as are provided in Section 6 hereof;
 
(xviii)       notify in writing each holder of Registrable Securities of any proposal by the Company to amend or waive any provision of this Exchange and Registration Rights Agreement pursuant to Section 9(h) hereof and of any amendment or waiver
 
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effected pursuant thereto, each of which notices shall contain the text of the amendment or waiver proposed or effected, as the case may be;
 
(xix)          in the event that any broker-dealer registered under the Exchange Act shall underwrite any Registrable Securities or participate as a member of an underwriting syndicate or selling group or “assist in the distribution” (within the meaning of the Conduct Rules (the “Conduct Rules”) of the National Association of Securities Dealers, Inc. (“NASD”) or any successor thereto, as amended from time to time) thereof, whether as a holder of such Registrable Securities or as an underwriter, a placement or sales agent or a broker or dealer in respect thereof, or otherwise, assist such broker-dealer in complying with the requirements of such Conduct Rules, including by (A) if such Conduct Rules shall so require, engaging a “qualified independent underwriter” (as defined in such Conduct Rules) to participate in the preparation of the Shelf Registration Statement relating to such Registrable Securities, to exercise usual standards of due diligence in respect thereto and, if any portion of the offering contemplated by such Shelf Registration Statement is an underwritten offering or is made through a placement or sales agent, to recommend the yield of such Registrable Securities, (B) indemnifying any such qualified independent underwriter to the extent of the indemnification of underwriters provided in Section 6 hereof (or to such other customary extent as may be requested by such underwriter), and (C) providing such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Conduct Rules; and
 
(xx)           comply with all applicable rules and regulations of the Commission, and make generally available to its securityholders as soon as practicable but in any event not later than eighteen months after the effective date of such Shelf Registration Statement, an earning statement of the Guarantor and its subsidiaries complying with Section 11(a) of the Securities Act (including, at the option of the Guarantor, Rule 158 thereunder).
 
(e)            In the event that the Company, pursuant to Section 3(i) below, has notified the Electing Holders, the placement or sales agent, if any, therefor and the managing underwriters, if any, thereof, that offers and sales of Exchange Securities have been suspended, the Company, as soon as commercially practicable, will notify such persons when offers and sales of Exchange Securities may be made.
 
(f)             In the event of a Shelf Registration, in addition to the information required to be provided by each Electing Holder in its Notice Questionnaire, the Company may require such Electing Holder to furnish to the Company such additional information regarding such Electing Holder and such Electing Holder’s intended method of distribution of Registrable Securities as may be required in order to comply with the Securities Act. Each such Electing Holder agrees to notify the Company as promptly as practicable of any inaccuracy or change in information previously furnished by such Electing Holder to the Company or of the occurrence of any event in either case as a result of which any prospectus relating to such Shelf Registration contains or would contain an untrue statement of a material fact regarding such Electing Holder or such Electing Holder’s intended method of disposition of such Registrable Securities or omits to state any material fact regarding such Electing Holder or such Electing Holder’s intended method of disposition of such Registrable Securities required to be stated therein or necessary to make the statements therein not
 
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misleading in light of the circumstances then existing, and promptly to furnish to the Company any additional information required to correct and update any previously furnished information or required so that such prospectus shall not contain, with respect to such Electing Holder or the disposition of such Registrable Securities, an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing.
 
(g)            Until the earlier to occur of the expiration of two years after the Closing Date or the time that the Securities are freely resaleable pursuant to Rule 144, the Company will not, and will not permit any of its “affiliates” (as defined in Rule 144) to, resell any of the Securities that have been reacquired by any of them except pursuant to an effective registration statement under the Securities Act.
 
(h)            The Company represents, warrants and covenants that it (including its agents and representatives) will not prepare, make, use, authorize, approve or refer to any Free Writing Prospectus.
 
(i)             The Company may suspend the availability of the Shelf Registration Statement (a “Suspension Event”) by notifying the Electing Holders, the placement or sales agent, if any, and the managing underwriters, if any, that it is suspending the use of any Shelf Registration Statement and that such persons may not use such Shelf Registration Statement or any prospectus included therein for offers and sales of Securities; provided that, if such notice of a Suspension Event has been given to such persons, the Company shall, as promptly as practicable following a determination that the Suspension Event no longer exists and that such persons may recommence such offers and sales, notify such persons of such determination. Each Electing Holder, placement or sales agent, if any, and managing underwriter, if any, agrees that upon receipt of any notice from the Company pursuant to this Section 3(i), such person shall forthwith discontinue the disposition of Securities until such person shall have been notified by the Company that offers and sales of the Registrable Securities may recommence. If, upon termination of a Suspension Period, in the Company’s judgment it is necessary to amend or supplement the Shelf Registration Statement, the Company will prepare and furnish to each Electing Holder, placement agent or underwriter, as requested, a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to purchasers of such Securities during the Resale Period, such prospectus shall conform in all material respects to the applicable requirements of the Securities Act and the Trust Indenture Act.
 
4.              Registration Expenses .
 
The Company agrees to bear and to pay or cause to be paid promptly upon delivery of itemized invoices, all expenses incident to the Company’s performance of or compliance with this Exchange and Registration Rights Agreement, including (a) all Commission and any NASD registration, filing and review fees and expenses including reasonable fees and disbursements of counsel for the placement or sales agent or underwriters in connection with such NASD registration, filing and review, (b) all fees and expenses in connection with the qualification of the Securities for offering and sale under the State securities and blue sky laws referred to in Section 3(d)(xii) hereof and determination of their eligibility for investment under the laws of such jurisdictions as any managing underwriters or the Electing Holders may designate, including any reasonable fees and disbursements of counsel for the Electing Holders or underwriters in connection with such qualification and determination, (c) all expenses relating to the preparation, printing, production, distribution and reproduction of each registration statement
 
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required to be filed hereunder, each prospectus included therein or prepared for distribution pursuant hereto, each amendment or supplement to the foregoing, the expenses of preparing the Securities for delivery and the expenses of printing or reproducing any underwriting agreements, agreements among underwriters, selling agreements and blue sky or legal investment memoranda and all other documents in connection with the offering, sale or delivery of Securities to be disposed of (including certificates representing the Securities), (d) messenger, telephone and delivery expenses relating to the offering, sale or delivery of Securities and the preparation of documents referred in clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any agent of the Trustee and any counsel for the Trustee and of any collateral agent or custodian, (f) internal expenses (including all salaries and expenses of the Company’s officers and employees performing legal or accounting duties), (g) fees, disbursements and expenses of counsel and independent certified public accountants of the Guarantor (including the expenses of any opinions or “cold comfort” letters required by or incident to such performance and compliance), (h) reasonable fees, disbursements and expenses of any “qualified independent underwriter” engaged pursuant to Section 3(d)(xix) hereof, (i) reasonable fees, disbursements and expenses of one counsel for the Electing Holders retained in connection with the Shelf Registration Statement, as selected by the Electing Holders of at least a majority in aggregate principal amount of the Registrable Securities held by Electing Holders (which counsel shall be reasonably satisfactory to the Company), (j) any fees charged by securities rating services for rating the Securities, and (k) fees, expenses and disbursements of any other persons, including special experts, retained by the Company in connection with such registration (collectively, the “Registration Expenses”). To the extent that any Registration Expenses are incurred, assumed or paid by any holder of Registrable Securities or any placement or sales agent therefor or underwriter thereof, the Company shall reimburse such person for the full amount of the Registration Expenses so incurred, assumed or paid promptly after receipt of a request therefor and an itemized invoice with respect thereto. Notwithstanding the foregoing, the holders of the Registrable Securities being registered shall pay all agency fees and commissions and underwriting discounts and commissions attributable to the sale of such Registrable Securities and the fees and disbursements of any counsel or other advisors or experts retained by such holders (severally or jointly), other than the counsel and experts specifically referred to above.
 
5.              Representations and Warranties .
 
The Company and the Guarantor, jointly and severally, represent and warrant to, and agree with, each Purchaser and each of the holders from time to time of Registrable Securities that:
 
(a)            Each registration statement covering Registrable Securities and each prospectus (including any preliminary or summary prospectus) contained therein or furnished pursuant to Section 3(d) or Section 3(c) hereof and any further amendments or supplements to any such registration statement or prospectus, when it becomes effective or is filed with the Commission, as the case may be, and, in the case of an underwritten offering of Registrable Securities, at the time of the closing under the underwriting agreement relating thereto, will conform in all material respects to the requirements of the Securities Act and the Trust Indenture Act and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and at all times subsequent to the Effective Time when a prospectus would be required to be delivered under the Securities Act, other than from (i) such time as a notice has been given to holders
 
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of Registrable Securities pursuant to Section 3(i) hereof until (ii) such time as the Company furnishes an amended or supplemented prospectus pursuant to Section 3(c)(iv) hereof or notifies the Electing Holders that offers and sales may recommence pursuant to Section 3(i) hereof, each such registration statement, and each prospectus (including any summary prospectus) contained therein or furnished pursuant to Section 3(e) or Section 3(c) hereof, as then amended or supplemented, will conform in all material respects to the requirements of the Securities Act and the Trust Indenture Act and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by a holder of Registrable Securities or any underwriter or placement agent expressly for use therein.
 
(b)            The compliance by the Company and the Guarantor with all of the provisions of this Exchange and Registration Rights Agreement and the consummation of the transactions herein contemplated will not contravene (i) any provision of the applicable law or the certificate of incorporation or other governing documents or the By-Laws of the Company or the Guarantor or (ii) any agreement or other instrument binding upon the Company or the Guarantor, or (iii) any judgment, order or decree of any governmental body, agency or body having jurisdiction over the Guarantor or the Company; and no consent, approval, authorization, order, registration or qualification of or with any governmental agency or body is required to be obtained by the Company or the Guarantor for the performance by the Company or the Guarantor of its obligations under this Exchange and Registration Rights Agreement, except the registration under the Securities Act of the Securities, qualification of the Indenture under the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under State securities or blue sky laws in connection with the offering and distribution of the Securities.
 
(c)            This Exchange and Registration Rights Agreement has been duly authorized, executed and delivered by the Company.
 
6.              Indemnification .
 
(a)            Indemnification by the Company and the Guarantor. The Company and the Guarantor, jointly and severally, will indemnify and hold harmless each of the holders of Registrable Securities included in an Exchange Registration Statement, each of the Electing Holders of Registrable Securities included in a Shelf Registration Statement and each person who participates as a placement or sales agent or as an underwriter in any offering or sale of such Registrable Securities against any losses, claims, damages or liabilities, joint or several, to which such holder, agent or underwriter may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Exchange Registration Statement or Shelf Registration Statement, as the case may be, under which such Registrable Securities were registered under the Securities Act, or any preliminary, final or summary prospectus contained therein or furnished by the Company to any such holder, Electing Holder, agent or underwriter, or any amendment or supplement thereto, or any Free Writing Prospectus or any “issuer information” (“Issuer Information”) filed or required to be filed pursuant to Rule
 
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433(d) under the Securities Act, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse such holder, such Electing Holder, such agent and such underwriter for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that neither the Company nor the Guarantor shall be liable to any such person in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, or preliminary, final or summary prospectus, or amendment or supplement thereto, in reliance upon and in conformity with written information furnished to the Company by such person expressly for use therein.
 
(b)            Indemnification by the Holders and any Agents and Underwriters. The Company may require, as a condition to including any Registrable Securities in any registration statement filed pursuant to Section 2(b) hereof and to entering into any underwriting agreement with respect thereto, that the Company shall have received an undertaking reasonably satisfactory to it from the Electing Holder of such Registrable Securities and from each underwriter named in any such underwriting agreement, severally and not jointly, to (i) indemnify and hold harmless the Company , the Guarantor, and all other holders of Registrable Securities, against any losses, claims, damages or liabilities to which the Company , the Guarantor or such other holders of Registrable Securities may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in such registration statement, or any preliminary, final or summary prospectus contained therein or furnished by the Company to any such Electing Holder, agent or underwriter, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company by such Electing Holder or underwriter expressly for use therein, and (ii) reimburse the Company and the Guarantor for any legal or other expenses reasonably incurred by the Company and the Guarantor in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that no such Electing Holder shall be required to undertake liability to any person under this Section 6(b) for any amounts in excess of the dollar amount of the proceeds to be received by such Electing Holder from the sale of such Electing Holder’s Registrable Securities pursuant to such registration.
 
(c)            Notices of Claims, Etc. Promptly after receipt by an indemnified party under subsection (a) or (b) above of written notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against an indemnifying party pursuant to the indemnification provisions of or contemplated by this Section 6, notify such indemnifying party in writing of the commencement of such action; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under the indemnification provisions of or contemplated by Section 6(a) or 6(b) hereof. In case any such action shall be brought against any indemnified party and it shall notify an indemnifying party of the commencement thereof, such indemnifying party shall be entitled to participate therein and, to the extent that it shall
 
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wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, such indemnifying party shall not be liable to such indemnified party for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
 
(d)            Contribution. If for any reason the indemnification provisions contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault of such indemnifying party and indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or by such indemnified party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and equitable if contributions pursuant to this Section 6(d) were determined by pro rata allocation (even if the holders or any agents or underwriters or all of them were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 6(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages, or liabilities (or actions in respect thereof) referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 6(d), no holder shall be required to contribute any amount in excess of the amount by which the dollar amount of the proceeds received by such holder from the sale of any Registrable Securities (after deducting any fees, discounts and commissions applicable thereto) exceeds the amount of any damages which such holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission, and no underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Registrable Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent
 
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misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The holders’ and any underwriters’ obligations in this Section 6(d) to contribute shall be several in proportion to the principal amount of Registrable Securities registered or underwritten, as the case may be, by them and not joint.
 
(e)            The obligations of the Company and the Guarantor under this Section 6 shall be in addition to any liability which the Company or the Guarantor may otherwise have and shall extend, upon the same terms and conditions, to each officer, director and partner of each holder, agent and underwriter and each person, if any, who controls any holder, agent or underwriter within the meaning of the Securities Act; and the obligations of the holders and any agents or underwriters contemplated by this Section 6 shall be in addition to any liability which the respective holder, agent or underwriter may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company or the Guarantor (including any person who, with his consent, is named in any registration statement as about to become a director of the Company or the Guarantor) and to each person, if any, who controls the Company within the meaning of the Securities Act.
 
7.              Underwritten Offerings .
 
(a)            Selection of Underwriters. If any of the Registrable Securities covered by the Shelf Registration are to be sold pursuant to an underwritten offering, the managing underwriter or underwriters thereof shall be designated by Electing Holders holding at least a majority in aggregate principal amount of the Registrable Securities to be included in such offering, provided that such designated managing underwriter or underwriters is or are acceptable to the Company.
 
(b)            Participation by Holders. Each holder of Registrable Securities hereby agrees with each other such holder that no such holder may participate in any underwritten offering hereunder unless such holder (i) agrees to sell such holder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements.
 
8.              Rule 144 .
 
The Company covenants to the holders of Registrable Securities that to the extent it shall be required to do so under the Exchange Act, the Company shall timely file the reports required to be filed by it under the Exchange Act or the Securities Act (including the reports under Section 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the Commission under the Securities Act) and the rules and regulations adopted by the Commission thereunder, all to the extent required from time to time to enable such holder to sell Registrable Securities without registration under the Securities Act within the limitations of the exemption provided by Rule 144 under the Securities Act, as such Rule may be amended from time to time, or any similar or successor rule or regulation hereafter adopted by the Commission. Upon the request of any holder of Registrable Securities in connection with that holder’s sale pursuant to Rule 144, the Company shall deliver to such holder a written statement as to whether it has complied with such requirements.
 
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9.              Miscellaneous .
 
(a)            No Inconsistent Agreements. The Company represents, warrants, covenants and agrees that it has not granted, and shall not grant, registration rights with respect to Registrable Securities or any other securities which would be inconsistent with the terms contained in this Exchange and Registration Rights Agreement.
 
(b)            Specific Performance. The parties hereto acknowledge that there would be no adequate remedy at law if the Company fails to perform any of its obligations hereunder and that the Purchasers and the holders from time to time of the Registrable Securities may be irreparably harmed by any such failure, and accordingly agree that the Purchasers and such holders, in addition to any other remedy to which they may be entitled at law or in equity, shall be entitled to compel specific performance of the obligations of the Company under this Exchange and Registration Rights Agreement in accordance with the terms and conditions of this Exchange and Registration Rights Agreement, in any court of the United States or any State thereof having jurisdiction.
 
(c)            Notices. All notices, requests, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered by hand, if delivered personally or by courier, or three days after being deposited in the mail (registered or certified mail, postage prepaid, return receipt requested) as follows: If to the Company, to it at 1050 Westlakes Drive, Berwyn, PA 19312, Attention: Treasurer, and if to a holder, to the address of such holder set forth in the security register or other records of the Company, or to such other address as the Company or any such holder may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.
 
(d)            Parties in Interest. All the terms and provisions of this Exchange and Registration Rights Agreement shall be binding upon, shall inure to the benefit of and shall be enforceable by the parties hereto and the holders from time to time of the Registrable Securities and the respective successors and assigns of the parties hereto and such holders. In the event that any transferee of any holder of Registrable Securities shall acquire Registrable Securities, in any manner, whether by gift, bequest, purchase, operation of law or otherwise, such transferee shall, without any further writing or action of any kind, be deemed a beneficiary hereof for all purposes and such Registrable Securities shall be held subject to all of the terms of this Exchange and Registration Rights Agreement, and by taking and holding such Registrable Securities such transferee shall be entitled to receive the benefits of, and be conclusively deemed to have agreed to be bound by all of the applicable terms and provisions of this Exchange and Registration Rights Agreement. If the Company shall so request, any such successor, assign or transferee shall agree in writing to acquire and hold the Registrable Securities subject to all of the applicable terms hereof.
 
(e)            Survival. The respective indemnities, agreements, representations, warranties and each other provision set forth in this Exchange and Registration Rights Agreement or made pursuant hereto shall remain in full force and effect regardless of any investigation (or statement as to the results thereof) made by or on behalf of any holder of Registrable Securities, any director, officer or partner of such holder, any agent or underwriter or any director, officer or partner thereof, or any controlling person of any of the foregoing, and shall survive delivery of and payment for the Registrable Securities pursuant to the
 
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Purchase Agreement and the transfer and registration of Registrable Securities by such holder and the consummation of an Exchange Offer.
 
(f)             Governing Law. This Exchange and Registration Rights Agreement shall be governed by and construed in accordance with the laws of the State of New York.
 
(g)            Headings. The descriptive headings of the several Sections and paragraphs of this Exchange and Registration Rights Agreement are inserted for convenience only, do not constitute a part of this Exchange and Registration Rights Agreement and shall not affect in any way the meaning or interpretation of this Exchange and Registration Rights Agreement.
 
(h)            Entire Agreement; Amendments. This Exchange and Registration Rights Agreement and the other writings referred to herein (including the Indenture and the form of Securities) or delivered pursuant hereto which form a part hereof contain the entire understanding of the parties with respect to its subject matter. This Exchange and Registration Rights Agreement supersedes all prior agreements and understandings between the parties with respect to its subject matter. This Exchange and Registration Rights Agreement may be amended and the observance of any term of this Exchange and Registration Rights Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only by a written instrument duly executed by the Company and the holders of at least a majority in aggregate principal amount of the Registrable Securities at the time outstanding. Each holder of any Registrable Securities at the time or thereafter outstanding shall be bound by any amendment or waiver effected pursuant to this Section 9(h), whether or not any notice, writing or marking indicating such amendment or waiver appears on such Registrable Securities or is delivered to such holder.
 
(i)             Inspection. For so long as this Exchange and Registration Rights Agreement shall be in effect, this Exchange and Registration Rights Agreement and a complete list of the names and addresses of all the holders of Registrable Securities shall be made available for inspection and copying on any business day by any holder of Registrable Securities for proper purposes only (which shall include any purpose related to the rights of the holders of Registrable Securities under the Securities, the Indenture and this Agreement) at the offices of the Company at the address thereof set forth in Section 9(c) above and at the office of the Trustee under the Indenture.
 
(j)             Counterparts. This agreement may be executed by the parties in counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument.

If the foregoing is in accordance with your understanding, please sign and return to us eight counterparts hereof, and upon the acceptance hereof by you, on behalf of each of the Purchasers, this letter and such acceptance hereof shall constitute a binding agreement among each of the Purchasers , the Guarantor and the Company. It is understood that your acceptance of this letter on behalf of each of the Purchasers is pursuant to the authority set forth in a form of Agreement among Purchasers, the form of which shall be submitted to the Company for examination upon request, but without warranty on your part as to the authority of the signers thereof.

 	Very truly yours,	
 	 	 	
 	Tyco Electronics Group S.A.	

 	By:	/s/ Mario Calastri	 	
 	 	Name:	Mario Calastri	
 	 	Title:	Director	
 	 	 	 	
 	Tyco Electronics Ltd.	

 	By:	/s/ Terrence R. Curtin	 	
 	 	Name:	Terrence R. Curtin	
 	 	Title:	Executive Vice President and
Chief Financial Officer	

Accepted as of the date hereof:	 	 	

Goldman, Sachs & Co.	 	 	

By:	/s/ Goldman, Sachs & Co.	 	 	 	
 	(Goldman, Sachs & Co.)	 	 	
 	 	 	
UBS Securities LLC	 	 	

By:	/s/ John Dougherty	 	 	 	
 	Name: John Dougherty	 	 	
 	Title: Executive Director	 	 	
 	 	 	
By:	/s/ Spencer Haimes	 	 	 	
 	Name: Spencer Haimes	 	 	
 	Title: Executive Director	 	 	

On behalf of each of the Purchasers	 	 	

23

Exhibit A
 
Tyco Electronics Group S.A.
 
INSTRUCTION TO DTC PARTICIPANTS
 
(Date of Mailing)
 
URGENT - IMMEDIATE ATTENTION REQUESTED
 
DEADLINE FOR RESPONSE:  [DATE] *
 
The Depository Trust Company (“DTC”) has identified you as a DTC Participant through which beneficial interests in Tyco Electronics Group S.A. (the “Company”) U.S. $800,000,000 6.000% Senior Notes due 2012, U.S. $750,000,000 6.550% Senior Notes due 2017 and U.S. $500,000,000 7.125% Senior Notes due 2037 (collectively the “Securities”) are held.
 
The Company is in the process of registering the Securities under the Securities Act of 1933 for resale by the beneficial owners thereof. In order to have their Securities included in the registration statement, beneficial owners must complete and return the enclosed Notice of Registration Statement and Selling Securityholder Questionnaire.
 
It is important that beneficial owners of the Securities receive a copy of the enclosed materials as soon as possible as their rights to have the Securities included in the registration statement depend upon their returning the Notice and Questionnaire by [Deadline For Response] . Please forward a copy of the enclosed documents to each beneficial owner that holds interests in the Securities through you. If you require more copies of the enclosed materials or have any questions pertaining to this matter, please contact:  Tyco Electronics Group S.A., 96 Pitts Bay Road, Second Floor, Pembroke HM 08, Bermuda (Telephone: (441) 292-8674).

*Not less than 28 calendar days from date of mailing.
 
A-1

 
Tyco Electronics Group S.A.
 
Notice of Registration Statement
and
Selling Securityholder Questionnaire
 
(Date)
 
Reference is hereby made to the Exchange and Registration Rights Agreement (the “Exchange and Registration Rights Agreement”) between Tyco Electronics Group S.A. (the “Company”) and the Purchasers named therein. Pursuant to the Exchange and Registration Rights Agreement, the Company has filed with the United States Securities and Exchange Commission (the “Commission”) a registration statement on Form  [         ] (the “Shelf Registration Statement”) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of the Company’s U.S. $800,000,000 6.000% Senior Notes due 2012, U.S. $750,000,000 6.550% Senior Notes due 2017 and U.S. $500,000,000 7.125% Senior Notes due 2037 (collectively, the “Securities”). A copy of the Exchange and Registration Rights Agreement is attached hereto. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Exchange and Registration Rights Agreement.
 
Each beneficial owner of Registrable Securities (as defined below) is entitled to have the Registrable Securities beneficially owned by it included in the Shelf Registration Statement. In order to have Registrable Securities included in the Shelf Registration Statement, this Notice of Registration Statement and Selling Securityholder Questionnaire (“Notice and Questionnaire”) must be completed, executed and delivered to the Company’s counsel at the address set forth herein for receipt ON OR BEFORE [Deadline for Response] . Beneficial owners of Registrable Securities who do not complete, execute and return this Notice and Questionnaire by such date (i) will not be named as selling securityholders in the Shelf Registration Statement and (ii) may not use the Prospectus forming a part thereof for resales of Registrable Securities.
 
Certain legal consequences arise from being named as a selling securityholder in the Shelf Registration Statement and related Prospectus. Accordingly, holders and beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or not being named as a selling securityholder in the Shelf Registration Statement and related Prospectus.
 
The term “ Registrable Securities ” is defined in the Exchange and Registration Rights Agreement.
 
A-2

 
ELECTION
 
The undersigned holder (the “Selling Securityholder”) of Registrable Securities hereby elects to include in the Shelf Registration Statement the Registrable Securities beneficially owned by it and listed below in Item (3). The undersigned, by signing and returning this Notice and Questionnaire, agrees to be bound with respect to such Registrable Securities by the terms and conditions of this Notice and Questionnaire and the Exchange and Registration Rights Agreement, including, without limitation, Section 6 of the Exchange and Registration Rights Agreement, as if the undersigned Selling Securityholder were an original party thereto.
 
Upon any sale of Registrable Securities pursuant to the Shelf Registration Statement, the Selling Securityholder will be required to deliver to the Company and Trustee the Notice of Transfer set forth as Exhibit B to the Exchange and Registration Rights Agreement.
 
The Selling Securityholder hereby provides the following information to the Company and represents and warrants that such information is accurate and complete:
 
A-3

 
QUESTIONNAIRE

(1)	(a)	Full Legal Name of Selling Securityholder:	
 	 	 	
 	(b)	Full Legal Name of Registered Holder (if not the same as in (a) above) of Registrable Securities Listed in Item (3) below:	
 	 	 	
 	(c)	Full Legal Name of DTC Participant (if applicable and if not the same as (b) above) Through Which Registrable Securities Listed in Item (3) below are Held:	
 	 	 	
(2)	 	Address for Notices to Selling Securityholder:	

 	 	 	
 	 	Telephone:	
 	 	Fax:	
 	 	Contact Person:	
 	 	 	
(3)	 	Beneficial Ownership of Securities:	
 	 	 	
 	 	Except as set forth below in this Item (3), the undersigned does not beneficially own any Securities.	
 	 	 	
(a)	 	Principal amount of Registrable Securities beneficially owned:	
 	 	CUSIP No(s). of such Registrable Securities:	
 	 	 	
(b)	 	Principal amount of Securities other than Registrable Securities beneficially owned:	
 	 	 	
 	 	CUSIP No(s). of such other Securities:	
 	 	 	
(c)	 	Principal amount of Registrable Securities which the undersigned wishes to be included in the Shelf Registration Statement:	
 	 	CUSIP No(s). of such Registrable Securities to be included in the Shelf Registration Statement:	
 	 	 	
(4)	 	Beneficial Ownership of Other Securities of the Company:	
 	 	 	
 	 	Except as set forth below in this Item (4), the undersigned Selling Securityholder is not the beneficial or registered owner of any other securities of the Company, other than the Securities listed above in Item (3).	
 	 	 	
 	 	State any exceptions here:	
 
A-4

 

(5)	 	Relationships with the Company:	
 	 	 	
 	 	Except as set forth below, neither the Selling Securityholder nor any of its affiliates, officers, directors or principal equity holders (5% or more) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years.	
 	 	 	
 	 	State any exceptions here:	
 	 	 	
(6)	 	Plan of Distribution:	
 	 	 	
 	 	Except as set forth below, the undersigned Selling Securityholder intends to distribute the Registrable Securities listed above in Item (3) only as follows (if at all): Such Registrable Securities may be sold from time to time directly by the undersigned Selling Securityholder or, alternatively, through underwriters, broker-dealers or agents. Such Registrable Securities may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined at the time of sale, or at negotiated prices. Such sales may be effected in transactions (which may involve crosses or block transactions) (i) on any national securities exchange or quotation service on which the Registered Securities may be listed or quoted at the time of sale, (ii) in the over-the-counter market, (iii) in transactions otherwise than on such exchanges or services or in the over-the-counter market, or (iv) through the writing of options. In connection with sales of the Registrable Securities or otherwise, the Selling Securityholder may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the Registrable Securities in the course of hedging the positions they assume. The Selling Securityholder may also sell Registrable Securities short and deliver Registrable Securities to close out such short positions, or loan or pledge Registrable Securities to broker-dealers that in turn may sell such securities.	
 	 	 	
 	 	State any exceptions here:	
 
By signing below, the Selling Securityholder acknowledges that it understands its obligation to comply, and agrees that it will comply, with the provisions of the Exchange Act and the rules and regulations thereunder, particularly Regulation M.
 
In the event that the Selling Securityholder transfers all or any portion of the Registrable Securities listed in Item (3) above after the date on which such information is provided to the Company, the Selling Securityholder agrees to notify the transferee(s) at the time of the transfer of its rights and obligations under this Notice and Questionnaire and the Exchange and Registration Rights Agreement.
 
By signing below, the Selling Securityholder consents to the disclosure of the information contained herein in its answers to Items (1) through (6) above and the inclusion of such information in the Shelf Registration Statement and related Prospectus. The Selling Securityholder understands that such information will be relied upon by the Company in connection with the preparation of the Shelf Registration Statement and related Prospectus.
 
A-5

 
In accordance with the Selling Securityholder’s obligation under Section 3(d) of the Exchange and Registration Rights Agreement to provide such information as may be required by law for inclusion in the Shelf Registration Statement, the Selling Securityholder agrees to promptly notify the Company of any inaccuracies or changes in the information provided herein which may occur subsequent to the date hereof at any time while the Shelf Registration Statement remains in effect. All notices hereunder and pursuant to the Exchange and Registration Rights Agreement shall be made in writing, by hand-delivery, first-class mail, or air courier guaranteeing overnight delivery as follows:

(i)	To the Company and the Guarantor:	
 	 	
 	 	Tyco Electronics Group S.A.,	
 	 	96 Pitts Bay Road, Second Floor	
 	 	Pembroke HM 08, Bermuda	
 	 	Telephone: (441) 292-8674.	
 	 	 	
(ii)	With a copy to:	
 	 	Steven R. Finley	
 	 	Sean P. Griffiths	
 	 	Gibson, Dunn & Crutcher LLP	
 	 	200 Park Avenue	
 	 	New York, New York 10166-0193	
 	 	Telephone: (212) 351-4000	
 	 	Fax: (212) 351-4035	
 
Once this Notice and Questionnaire is executed by the Selling Securityholder and received by the Company’s counsel, the terms of this Notice and Questionnaire, and the representations and warranties contained herein, shall be binding on, shall inure to the benefit of and shall be enforceable by the respective successors, heirs, personal representatives, and assigns of the Company and the Selling Securityholder (with respect to the Registrable Securities beneficially owned by such Selling Securityholder and listed in Item (3) above. This Agreement shall be governed in all respects by the laws of the State of New York.
 
A-6

 
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized agent.

Dated:	 	 	

 	 	 	
 	Selling Securityholder	
 	(Print/type full legal name of beneficial owner of Registrable Securities)	

 	By:	 	 	
 	Name:	
 	Title:	

PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON OR BEFORE [DEADLINE FOR RESPONSE] TO THE COMPANY’S COUNSEL AT:
 
Steven R. Finley
Sean P. Griffiths
Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166-0193
Telephone: (212) 351-4000
Fax: (212) 351-4035
 
A-7

 
Exhibit B
 
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
 
Deutsche Bank Trust Company Americas
Tyco Electronics Group S.A.
c/o Deutsche Bank Trust Company Americas
[Address of Trustee]
 
Attention:  Trust Officer
 
Re:                                Tyco Electronics Group S.A. (the “Company”)
U.S. $800,000,000 6.000% Senior Notes due 2012, U.S. $750,000,000 6.550%
Senior Notes due 2017 and U.S. $500,000,000 7.125% Senior Notes due 2037
 
Dear Sirs:
 
Please be advised that                                            has transferred $                                         aggregate principal amount of the above-referenced Notes pursuant to an effective Registration Statement on Form [             ] (File No. 333-              ) filed by the Company.
 
We hereby certify that the prospectus delivery requirements, if any, of the Securities Act of 1933, as amended, have been satisfied and that the above-named beneficial owner of the Notes is named as a “Selling Holder” in the Prospectus dated [date] or in supplements thereto, and that the aggregate principal amount of the Notes transferred are the Notes listed in such Prospectus opposite such owner’s name.

Dated:	 	

 	Very truly yours,	

 	 	(Name)	
 	 	 	
 	By:	 	 	
 	 	(Authorized Signature)	
 
B-1

EXHIBIT 10.11
 
Tyco Electronics Ltd.
2007 Stock and Incentive Plan
 
TERMS AND CONDITIONS
OF
OPTION AWARD
 
OPTION AWARD made as of                                               , 2007.
 
1.              Grant of Option. Tyco Electronics Ltd. (the “Company”) has granted you an Option to purchase Shares of Common Stock, the number of which is set forth in a separate grant notification letter (“Grant Letter”), subject to the provisions of this Award Agreement. This Option is a Non-Qualified Option.
 
2.              Exercise Price. The purchase price of the Shares covered by the Option is set forth in your Grant Letter.
 
3.              Vesting. The Option will become exercisable in cumulative installments as follows: one fourth (1/4) of the Shares specified in your Grant Letter, one (1) year from the Grant Date (as set forth in your Grant Letter); an additional one fourth (1/4) of the Shares, two (2) years from the Grant Date; an additional one fourth (1/4) of the Shares, three (3) years from the Grant Date; and the remaining one fourth (1/4), four (4) years from the Grant Date. Your vested right will be calculated on the anniversary of the Grant Date. If you terminate employment before full vesting, you will forfeit the unvested portion of the Option and, subject to Section 12, you may exercise the vested portion of the Option until the earlier of (a) the date described in Section 4 below, or (b) 90 days after your Termination of Employment. However, if your Termination of Employment is as a result of your Normal Retirement (Termination of Employment on or after age 60 if the sum of your age and years of service with the Company is at least 70), Retirement (Termination of Employment on or after age 55 if the sum of your age and years of service with the Company is at least 60), Death, Disability, Change in Control, or Divestiture or Outsourcing Agreement, this Option will become vested and exercisable in accordance with the provisions of Section 7, 8 or 9, as applicable.
 
4.              Term of Option. Unless the Option has been terminated or cancelled, the Option must be exercised before the close of the New York Stock Exchange (“NYSE”) on the day prior to the 10 th anniversary of the Grant Date. If the NYSE is not open for business on the expiration date specified, the Option will expire at the close of the NYSE’s next business day.
 
5.              Payment of Exercise Price. To exercise the Option, you must pay the Exercise Price for each Share as set forth in the Grant letter. You may pay the Exercise Price in cash, or by certified check, bank draft, wire transfer or postal or express money order. You may also pay the Exercise Price by using one or more of the following methods: (i) delivering to the Company or its agent a properly executed exercise notice, together with irrevocable instructions to a broker to deliver promptly (within the typical settlement cycle for the sale of equity securities on the relevant trading market, or otherwise in accordance with Regulation T issued by the Federal Reserve Board) to the Company sale or loan proceeds adequate to satisfy the portion of the
 
1

 
Exercise Price being so paid; (ii) if expressly approved by the Committee, tendering to the Company (by physical delivery or attestation) or its agent certificates of Common Stock that you have held for six (6) months or longer (unless the Committee, in its discretion, waives this 6-month period) and that have an aggregate Fair Market Value as of the day prior to the date of exercise equal to the portion of the Exercise Price and any applicable taxes being so paid; or (iii) if such form of payment is expressly authorized by Board or Committee, instructing the Company to withhold Shares that would otherwise be issued were the Exercise Price to be paid in cash and that have an aggregate Fair Market Value as of the date of exercise equal to the portion of the Exercise Price and any applicable taxes being so paid. Notwithstanding the foregoing, you may not tender any form of payment that the Company determines, in its sole and absolute discretion, could violate any law or regulation. You are not required to purchase all Shares subject to the Option at one time, but you must pay the full Exercise Price for all Shares that you elect to purchase before they will be delivered.
 
6.              Exercise of Option. Subject to the terms and conditions of this Award Agreement, the Option may be exercised by contacting UBS Financial Services Inc. at 877-461-7802 if calling from within the U.S. or 001-201-272-7684 if calling from outside the U.S., or such other stock option administrator as is selected by the Company. If the Option is exercised after your death, the Company will deliver Shares only after the Committee or its designee has determined that the person exercising the Option is the duly appointed executor or administrator of your estate or the person to whom the Option has been transferred by your will or by the applicable laws of descent and distribution.
 
7.              Retirement, Disability or Death. Notwithstanding the vesting and exercise provisions described in Section 3, the Option will vest and remain exercisable as set forth below (or as set forth in paragraph 8 or 9, as applicable), in the event of Retirement (as defined in paragraph 3), Normal Retirement (as defined in paragraph 3), Disability or Death, subject however, to Section 12:
 
2

 

Event	 	Vesting	 	Exercise	
Retirement (as defined in paragraph 3)	 	Unvested Awards are forfeited if you retire from active employment less than 12 months after Grant Date. On or after the first anniversary of Grant Date, a pro rata portion of the Unvested Awards (rounded up or down to the nearest full year increment), as determined based on the portion of the four year vesting term that you have completed prior to Termination (with an offset for shares previously vested) shall become exercisable upon the earlier of the normal vesting schedule (as listed in Section 3) or your Retirement.	 	Vested Awards expire on the earlier of (i) original expiration date described in Section 4, or (ii) 3 years after Retirement.	
 	 	 	 	 	
Normal Retirement (as defined in paragraph 3)	 	Notwithstanding the terms of the Plan, Unvested Awards are forfeited if you retire from active employment less than 12 months after Grant Date. On or after the first anniversary of Grant Date, Unvested Awards become fully exercisable upon the earlier of the original vesting schedule (as listed in Section 3) or your Normal Retirement.	 	Vested Awards expire on the earlier of (i) original expiration date described in Section 4, or (ii) 3 years after Normal Retirement.	
 	 	 	 	 	
Disability or Death	 	Unvested Awards become fully vested as of the Date of Termination	 	Vested Awards expire earlier of (i) original expiration date described in Section 4, or (ii) 3 years after Termination of Employment.	
 
3

 
8.              Change in Control. Notwithstanding the vesting and exercise provisions described in Section 3, and subject to Section 5.4 of the Plan, if your employment is terminated following a Change in Control, as defined in the Plan, your Option will immediately become fully vested, and you will be entitled to exercise the Option until the earlier of (x) the original expiration date described in Section 4 or (y) the third anniversary of your Termination of Employment, provided that:
 
(a) your employment is terminated by the Company or a Subsidiary for any reason other than Cause, Disability or death in the twelve-month period following the Change in Control; or
 
(b) you terminate your employment with the Company or your employing Subsidiary within the twelve-month period following the Change in Control as a result of, and within 180 days following, the occurrence of one of the following events:
 
i.   the Company or your employing Subsidiary (1) assigns or causes to be assigned to you duties inconsistent in any material respect with your position as in effect immediately prior to the Change in Control; (2) makes or causes to be made any material adverse change in your position, authority, duties or responsibilities; or (3) takes or causes to be taken any other action which, in your reasonable judgment, would cause you to violate your ethical or professional obligations (after written notice of such judgment has been provided by you to the Company and the Company has been given a 15-day period within which to cure such action), or which results in a significant diminution in such position, authority, duties or responsibilities; or
 
ii. the Company or your employing subsidiary, without your consent, (1) requires you to relocate to a principal place of employment more than fifty (50) miles from your existing place of employment; or (2) reduces your base salary, annual bonus, or retirement, welfare, stock incentive, perquisite (if any) and other benefits taken as a whole.
 
9.              Termination of Employment as a Result of Divestiture or Outsourcing . Notwithstanding the vesting and exercise provisions described in Section 3, and subject to Section 12, if your Termination of Employment is as a result of a Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement, your Option Award will vest on a pro-rata basis based on (i) the number of whole months completed from Grant Date through the closing date of the applicable transaction over the original number of months of the vesting period, times (ii) the total number of shares awarded under the Option minus (iii) the number of shares previously vested. The vested portion of your Option Award will expire on the earlier of the original expiration date of the Award described in Section 4 or three (3) years after the date of your Termination of Employment.
 
Notwithstanding the foregoing, you shall not be eligible for such pro-rata vesting and extended expiration date if, (i) your Termination of Employment occurs on or prior to the closing date of such Disposition of Assets or Disposition of a Subsidiary, as applicable, or on such later date as is specifically provided in the applicable transaction agreement or related agreements, or on the effective date of such Outsourcing Agreement applicable to you (the “Applicable
 
4

 
Employment Date”), and (ii) you are offered Comparable Employment with the buyer, successor company or outsourcing agent, as applicable, but do not commence such employment on the Applicable Employment Date.
 
For purposes of this section 9, (i) “Comparable Employment” is defined as employment at a base salary rate and bonus target that is at least equal to the base salary rate and bonus target in effect immediately prior to your termination of employment and at a location that is no more than 50 miles from your job location in effect immediately prior to your termination of employment; (ii) “Disposition of Assets” shall mean the disposition by the Company or a Subsidiary of all or a portion of the assets used by the Company or Subsidiary in a trade or business to an unrelated corporation or entity; (iii) “Disposition of a Subsidiary” shall mean the disposition by the Company or a Subsidiary of its interest in a subsidiary or controlled entity to an unrelated individual or entity, provided that such subsidiary or entity ceases to be an affiliated company as a result of such disposition; and (iv) “Outsourcing Agreement” shall mean a written agreement between the Company or a Subsidiary and an unrelated third party (“Outsourcing Agent”) pursuant to which (a) the Company transfers the performance of services previously performed by employees of the Company or Subsidiary to the Outsourcing Agent, and (b) the Outsourcing Agreement includes an obligation of the Outsourcing Agent to offer employment to any employee whose employment is being terminated as a result of or in connection with said Outsourcing Agreement.
 
10.            Withholdings. The Company will have the right, prior to the issuance or delivery of any Shares in connection with the exercise of the Option, to withhold or demand from you the amount necessary to satisfy applicable tax requirements, as determined by the Committee. The methods described in Section 5 may also be used to pay your withholding tax obligation.
 
11.            Transfer of Option. You may not transfer the Option or any interest in the Option except by will or the laws of descent and distribution. Notwithstanding the foregoing, you may transfer the Option to members of your immediate family or to one or more trusts for the benefit of family members or to one or more partnerships in which the family members are the only partners, provided that (i) you do not receive any consideration for the transfer, (ii) you furnish the Committee or its designee with detailed written notice of the transfer at least three (3) business days in advance, and (iii) the Committee or its designee consents in writing. For this purpose, “family member” means any spouse, children, grandchildren, parents, grandparents, siblings, nieces, nephews and grandnieces and grandnephews, including adopted, in-laws and step family members. Any Option transferred pursuant to this provision will continue to be subject to the same terms and conditions that were applicable to the Option immediately prior to transfer. The Option may be exercised by the transferee only to the same extent that you could have exercised the Option had no transfer occurred.
 
12.            Covenant; Forfeiture of Award; Agreement to Reimburse Company.
 
(a)            If you have been terminated for Cause, including without limitation a termination as a result of your violation of the Company’s Code of Ethical Conduct, any outstanding vested or unvested stock options shall be immediately rescinded and you will forfeit any rights you have with respect to those options and, in addition, you hereby agree and promise immediately to deliver to the Company, Shares (or, in the discretion of the Committee, cash)
 
5

 
equal in value to the amount of any profit you realized upon an exercise of the Option during the period beginning six (6) months prior to your Termination of Employment and ending on your Termination of Employment.
 
(b)            If, after your Termination of Employment, the Committee determines in its sole discretion that while you were a Company or Subsidiary employee you engaged in activity that would have constituted grounds for the Company or Subsidiary to terminate your employment for Cause, then the Company will immediately rescind the unvested portion of your Option and any vested but unexercised portion of the Option and you will immediately forfeit any and all rights you have remaining on the date the Committee makes such determination with respect to the Option. In addition, you hereby agree and promise immediately to deliver to the Company the number of Shares (or, in the discretion of the Committee, the cash value of said shares) equal in value to the amount of any profit you realized upon the exercise of any portion of the Option during the period six (6) months prior to your Termination of Employment through the date of the Committee’s determination.
 
(c)            If the Committee determines, in its sole discretion, that at anytime after your Termination of Employment and prior to the second anniversary of your Termination of Employment you (i) disclosed business confidential or proprietary information related to any business of the Company or Subsidiary or (ii) have entered into an employment or consultation arrangement (including any arrangement for employment or service as an agent, partner, stockholder, consultant, officer or director) with any entity or person engaged in a business and (a) such employment or consultation arrangement would likely (in the sole judgment of the Committee) result in the disclosure of business confidential or proprietary information related to any business of the Company or a Subsidiary to a business that is competitive with any Company or Subsidiary business as to which you have had access to business strategic or confidential information, and (b) the Committee has not approved the arrangement in writing, then any Option that you have not exercised (whether vested or unvested) will immediately be rescinded, and you will forfeit any rights you have with respect to these Options as of the date of the Committee’s determination. In addition, you hereby agree and promise immediately to deliver to the Company, Shares (or, in the discretion of the Committee, cash) equal in value to the amount of any profit you realized upon an exercise of the Option during the period beginning six (6) months prior to your Termination of Employment and ending on the Committee’s determination date.
 
13.            Adjustments. In the event of any stock split, reverse stock split, dividend or other distribution (whether in the form of cash, Shares, other securities or other property), extraordinary cash dividend, recapitalization, merger, consolidation, split-up, spin-off, reorganization, combination, repurchase or exchange of Shares or other securities, the issuance of warrants or other rights to purchase Shares or other securities, or other similar corporate transaction or event, the Committee shall adjust the number and kind of Shares covered by the Option, the Exercise Price and other relevant provisions to the extent necessary to prevent dilution or enlargement of the benefits or potential benefits intended to be provided by the Option.
 
14.            Restrictions on Exercise. Exercise of the Option is subject to the conditions that, to the extent required at the time of exercise, (a) the Shares covered by the Option will be duly
 
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listed, upon official notice of issuance, upon the NYSE, and (b) a Registration Statement under the Securities Act of 1933 with respect to the Shares will be effective or an exemption from registration will apply. The Company will not be required to deliver any Common Stock until all applicable federal and state laws and regulations have been complied with and all legal matters in connection with the issuance and delivery of the Shares have been approved by counsel of the Company. Notwithstanding this Statement of Terms and Conditions, Optionee may exercise the Option only pursuant to the “broker-assisted cashless exercise” method described in Section 5(i) of this Statement of Terms and conditions if so restricted by local law at the time of exercise.
 
15.            Disposition of Securities. By accepting the Award, you acknowledge that you have read and understand the Company’s Insider Trading Policy, and are aware of and understand your obligations under federal securities laws with respect to trading in the Company’s securities, and you agree not to use the Company’s “cashless exercise” program (or any successor program) at any time when you possess material nonpublic information with respect to the Company or when using the program would otherwise result in a violation of securities law. The Company will have the right to recover, or receive reimbursement for, any compensation or profit realized on the exercise of the Option or by the disposition of Shares received upon exercise of the Option to the extent that the Company has a right of recovery or reimbursement under applicable securities laws.
 
16.            Plan Terms Govern. The exercise of the Option, the disposition of any Shares received upon exercise of the Option, and the treatment of any gain on the disposition of these Shares are subject to the terms of the Plan and any rules that the Committee may prescribe. The Plan document, as may be amended from time to time, is incorporated into this Award Agreement. Capitalized terms used in this Award Agreement have the meaning set forth in the Plan, unless otherwise stated in this Award Agreement. In the event of any conflict between the terms of the Plan and the terms of this Award Agreement, the Plan will control. By accepting the Award, you acknowledge receipt of the Plan, as in effect on the date of this Award Agreement.
 
17.            Personal Data. To comply with applicable law and to administer the Plan and this Award Agreement properly, the Company and its agents may hold and process your personal data and/or sensitive personal data. Such data includes, but is not limited to, the information provided in this grant package and any changes thereto, other appropriate personal and financial data about you, and information about your participation in the Plan and Shares obtained under the Plan from time to time. By accepting the Award, you hereby give your explicit consent to the Company’s processing any such personal data and/or sensitive personal data. You also hereby give your explicit consent to the Company’s transfer of any such personal data and/or sensitive personal data outside the country in which you work or reside and to the United States. The legal persons for whom your personal data are intended include the Company and any of its Subsidiaries (or former Subsidiaries as are deemed necessary), the outside Plan administrator as selected by the Company from time to time, and any other person that the Company may find in its administration of the Plan to be appropriate. You have the right to review and correct your personal data by contacting your local Human Resources Representative. You understand that the transfer of the information outlined here is important to the administration of the Plan, and that failure to consent to the transmission of such information may limit or prohibit your participation in the Plan.
 
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18.            No Contract of Employment or Promise of Future Grants. By accepting the Award, you agree to be bound by this Award Agreement and acknowledge that the Award is granted at the sole discretion of the Company and is not considered part of any contract of employment with the Company or of your ordinary or expected salary or other compensation and will not be considered as part of such salary or compensation for purposes of any pension benefits or in the event of severance, redundancy or resignation. If your employment with the Company or a Subsidiary is terminated for any reason, whether lawfully or unlawfully, you agree that you will not be entitled by way of damages for breach of contract, dismissal or compensation for loss of office or otherwise to any sum, shares or other benefits to compensate you for the loss or diminution in value of any actual or prospective rights, benefits or expectation under or in relation to the Plan.
 
19.            Limitations. Nothing in this Award Agreement or the Plan gives you any right to continue in the employ of the Company or any of its Subsidiaries or to interfere in any way with the right of the Company or any Subsidiary to terminate your employment at any time. Payment of Shares is not secured by a trust, insurance contract or other funding medium, and you do not have any interest in any fund or specific asset of the Company by reason of the Option. You have no rights as a stockholder of the Company pursuant to the Option until Shares are actually delivered you.
 
20.            Incorporation of Other Agreements. This Award Agreement and the Plan constitute the entire understanding between you and the Company regarding the Option. This Award Agreement supersedes any prior agreements, commitments or negotiations concerning the Option.
 
21.            Severability. The invalidity or unenforceability of any provision of this Award Agreement will not affect the validity or enforceability of the other provisions of this Award Agreement, which will remain in full force and effect. Moreover, if any provision is found to be excessively broad in duration, scope or covered activity, the provision will be construed so as to be enforceable to the maximum extent compatible with applicable law.
 
By accepting this Award, you agree to the following:
 
(i)             you have carefully read, fully understand and agree to all of the terms and conditions described in this Award Agreement and the Plan; and
 
(ii)            you understand and agree that this Award Agreement and the Plan constitute the entire understanding between you and the Company regarding the Option, and that any prior agreements, commitments or negotiations concerning the Option are replaced and superseded.
 
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You will be deemed to consent to the application of the terms and conditions set forth in this Award Agreement and the Plan unless you contact Tyco Electronics, Ltd., c/o Equity Plan Administration, 1050 Westlakes Dr, Berwyn, PA 19312 in writing within thirty (30) days of the date of this Award Agreement. Notification of your non-consent will nullify this grant unless otherwise agreed to in writing by you and the Company.

 	Thomas J. Lynch	
 	Chief Executive Officer,	
 	Tyco Electronics, Ltd.	
 
9

EXHIBIT 10.13
 
Tyco Electronics Ltd.
2007 Stock and Incentive Plan
 
TERMS AND CONDITIONS
OF
RESTRICTED UNIT AWARD
 
RESTRICTED UNIT AWARD made as of                                 , 2007.
 
1.              Grant of Award.   Tyco Electronics Ltd. (“the Company”) has granted you Restricted Units, the amount of which is set forth in a separate grant notification letter (“Grant Letter”), subject to the provisions of this Award Agreement.  The Company will hold the Restricted Units in a bookkeeping account on your behalf until they become payable or are forfeited or cancelled.
 
2.              Payment Amount.   Each Restricted Unit represents one (1) Share of Common Stock.
 
3.              Form of Payment.   Vested Restricted Units will be redeemed solely for Shares, subject to Section 15.
 
4.              Time of Delivery.   Except as otherwise provided for in this Award Agreement, all vested Restricted Units and Dividend Equivalent Units shall be delivered to participants as soon as is administratively feasible following the Normal Vesting of the award.
 
5.              Dividends.   Restricted Units are a promise to deliver Common Stock upon vesting.  For each Restricted Unit that is unvested, you will be credited with a Dividend Equivalent Unit (DEU) for any cash or stock dividends distributed by the Company on Company Common Stock.  DEUs will be calculated at the same dividend rate paid to other holders of Common Stock.  DEUs will vest and be delivered in accordance with the vesting and payment schedules applicable to the underlying Units.
 
6.              Normal Vesting.   Except in the event of your Normal Retirement (Termination of Employment on or after age 60 if the sum of your age and years of service is at least 70), Retirement (Termination of Employment on or after age 55 if the sum of your age and years of service is at least 60), Termination of Employment, Death or Disability or a Change in Control, all restrictions on the Restricted Units will lapse in installments as follows: one third (1/3) of the Shares specified in your Grant Letter, two (2) years from the Grant Date; an additional one third (1/3) of the Shares, three (3) years from the Grant Date; and the remaining one third (1/3), four (4) years from the Grant Date.  Your vested right will be calculated on the anniversary of the Grant Date.  No credit will be given for periods following Termination of Employment, except as specifically provided herein.
 
7.              Termination of Employment.   Any Restricted Units that have not vested as of your Termination of Employment, other than as set forth in paragraphs 8, 9, 10 and 11 will immediately be forfeited, and your rights with respect to those Restricted Units will end.
 
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8.              Death or Disability.   If your Termination of Employment is as a result of your Death or Disability, your Award will immediately become fully vested.  Such vested Restricted Units will be delivered as soon as is administratively possible upon your Termination of Employment.  If you are deceased, the Company will make a payment to your estate immediately after the Committee or its designee has determined that the payee is the duly appointed executor or administrator of your estate.
 
9.              Retirement.   If upon grant of the Restricted Units, you are, or will become within the Normal Vesting period, eligible for Retirement or Normal Retirement, then different vesting and delivery rules may apply to your Restricted Units.  Termination of Employment as a result of your Retirement (as defined in paragraph 6) or Normal Retirement (as defined in paragraph 6) within 12 months of the Grant Date will result in the forfeiture of your Restricted Units, except as otherwise provided for in paragraphs 8, 10, and 11.  If you remain employed with the Company for a period of 12 months after the grant of the Restricted Units then the vesting of your Restricted Units shall accelerate on the following terms:
 
(a) Retirement :  Once you have satisfied the 12 month employment requirement following the date of grant of the Restricted Units, upon becoming Retirement eligible, your Restricted Units will vest pro rata rounded down to the nearest Unit (in full-month increments) each month based on (i) the number of whole months that you have completed from Grant Date through the end of the current month, over the original number of months of the vesting period, times (ii) the total number of Units awarded under the Grant minus (iii) the number of Units previously vested under the Normal Vesting terms;
 
(b)   Normal Retirement :  Once you have satisfied the 12 month employment requirement following the date of grant of the Restricted Units, upon becoming normal retirement eligible, your Restricted Units will immediately be fully vested.
 
In the case of Retirement and Normal Retirement eligible participants, the Restricted Units will be delivered upon the earlier of: (1) termination from service, which qualifies as a Retirement or Normal Retirement, or (2) the normal delivery schedule in paragraph 4.
 
10.            Change in Control.   If your employment is terminated following a Change in Control, as defined in the Plan, your Restricted Units will immediately become fully vested and delivered, provided that:
 
(a) your employment is terminated by the Company or a Subsidiary for any reason other than Cause, Disability or Death in the twelve-month period following the Change in Control; or
 
(b) you terminate your employment with the Company or your employing Subsidiary within the twelve-month period following the Change in Control as a result of, and within 180 days following, the occurrence of one of the following events:
 
i.   the Company or your employing Subsidiary (1) assigns or causes to be assigned to you duties inconsistent in any material respect with your position as in effect immediately prior to the Change in Control; (2) makes or causes to be
 
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made any material adverse change in your position, authority, duties or responsibilities; or (3) takes or causes to be taken any other action which, in your reasonable judgment, would cause you to violate your ethical or professional obligations (after written notice of such judgment has been provided by you to the Company and the Company has been given a 15-day period within which to cure such action), or which results in a significant diminution in such position, authority, duties or responsibilities; or
 
ii. the Company or your employing subsidiary, without your consent, (1) requires you to relocate to a principal place of employment more than fifty (50) miles from your existing place of employment; or (2) reduces your base salary, annual bonus, or retirement, welfare, stock incentive, perquisite (if any) and other benefits taken as a whole.
 
11.            Termination of Employment as a Result of Divestiture or Outsourcing . If your Termination of Employment is as a result of a Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement, your Restricted Unit Award will vest pro rata (in full-month increments) and will be delivered immediately.  The pro rated vesting will be based on (i) the number of whole months that you have completed from Grant Date through the closing date of the applicable transaction over the original number of months of the vesting period, times (ii) the total number of shares awarded under the Grant minus (iii) the number of shares previously vested under the Normal Vesting terms.
 
Notwithstanding the foregoing, you shall not be eligible for such pro-rata vesting if, (i) your Termination of Employment occurs on or prior to the closing date of such Disposition of Assets or Disposition of a Subsidiary, as applicable, or on such later date as is specifically provided in the applicable transaction agreement or related agreements, or on the effective date of such Outsourcing Agreement applicable to you (the “Applicable Employment Date”), and (ii) you are offered Comparable Employment with the buyer, successor company or outsourcing agent, as applicable, but do not commence such employment on the Applicable Employment Date.
 
For the purposes of this Section 11, (a) “Comparable Employment” shall mean employment at a base salary rate and bonus target that is at least equal to the base salary rate and bonus target in effect immediately prior to your termination of employment and at a location that is no more than 50 miles from your job location in effect immediately prior to your termination of employment; (b) “Disposition of Assets” shall mean the disposition by the Company or a Subsidiary of all or a portion of the assets used by the Company or Subsidiary in a trade or business to an unrelated corporation or entity;  (c) “Disposition of a Subsidiary” shall mean the disposition by the Company or a Subsidiary of its interest in a subsidiary or controlled entity to an unrelated individual or entity, provided that such subsidiary or entity ceases to be an affiliated company as a result of such disposition; and (d) “Outsourcing Agreement” shall mean a written agreement between the Company or a Subsidiary and an unrelated third party (“Outsourcing Agent”) pursuant to which the Company transfers the performance of services previously
 
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performed by employees of the Company or Subsidiary to the Outsourcing Agent, and the Outsourcing Agreement includes an obligation of the Outsourcing Agent to offer employment to any employee whose employment is being terminated as a result of or in connection with said Outsourcing Agreement.
 
  12.           Withholdings.   The Company will have the right, prior to any issuance or delivery of Shares on your Restricted Units, to withhold or require from you the amount necessary to satisfy applicable tax requirements, as determined by the Committee.  If you have not satisfied your tax withholding requirements in a timely manner, the Company will have the right to sell the number of shares necessary to satisfy such requirements.
 
13.            Transfer of Award.   You may not transfer any interest in Restricted Units except by will or the laws of descent and distribution.  Any other attempt to dispose of your interest in Restricted Units will be null and void.
 
14.            Covenant; Forfeiture of Award; Agreement to Reimburse Company.
 
(a)            If you have been terminated for Cause, any unvested restricted units shall be immediately rescinded and, in addition, you hereby agree and promise immediately to deliver to the Company the number of Shares (or, in the discretion of the Committee, the cash value of said shares) you received for Restricted Units that vested during the period six (6) months prior to your Termination of Employment through the date of Termination of Employment.
 
(b)            If, after your Termination of Employment, the Committee determines in its sole discretion that while you were a Company or Subsidiary employee you engaged in activity that would have constituted grounds for the Company or Subsidiary to terminate your employment for Cause, then you hereby agree and promise immediately to deliver to the Company the number of Shares (or, in the discretion of the Committee, the cash value of said shares) you received for Restricted Units that vested during the period six (6) months prior to your Termination of Employment through the date of Termination of Employment.
 
(c)            If the Committee determines, in its sole discretion, that at any time after your Termination of Employment and prior to the second anniversary of your Termination of Employment you (i) disclosed business confidential or proprietary information related to any business of the Company or Subsidiary or (ii) have entered into an employment or consultation arrangement (including any arrangement for employment or service as an agent, partner, stockholder, consultant, officer or director) with any entity or person engaged in a business and (A) such employment or consultation arrangement would likely (in the Committee’s sole discretion) result in the disclosure of business confidential or proprietary information related to any business of the Company or a Subsidiary to a business that is competitive with any Company or Subsidiary business as to which you have had access to business strategic or confidential information, and  (B) the Committee has not approved the arrangement in writing, then you hereby agree and promise immediately to deliver to the Company the number of Shares (or, in the discretion of the Committee, the cash value of said shares) you received for Restricted Units that vested during the period six (6) months prior to your Termination of Employment through the date of Termination of Employment.
 
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15.            Adjustments.   In the event of any stock split, reverse stock split, dividend or other distribution (whether in the form of cash, Shares, other securities or other property), extraordinary cash dividend, recapitalization, merger, consolidation, split-up, spin-off, reorganization, combination, repurchase or exchange of Shares or other securities, the issuance of warrants or other rights to purchase Shares or other securities, or other similar corporate transaction or event, the Committee shall adjust the number and kind of Shares covered by the Restricted Units and other relevant provisions to the extent necessary to prevent dilution or enlargement of the benefits or potential benefits intended to be provided by the Restricted Units.
 
16.            Restrictions on Payment of Shares.   Payment of Shares for your Restricted Units is subject to the conditions that, to the extent required at the time of delivery, (a) the Shares underlying the Restricted Units will be duly listed, upon official notice of redemption, upon the NYSE, and (b) a Registration Statement under the Securities Act of 1933 with respect to the Shares will be effective.  The Company will not be required to deliver any Common Stock until all applicable federal and state laws and regulations have been complied with and all legal matters in connection with the issuance and delivery of the Shares have been approved by counsel of the Company.
 
17.            Disposition of Securities.   By accepting the Award, you acknowledge that you have read and understand the Company’s insider trading policy, and are aware of and understand your obligations under federal securities laws in respect of trading in the Company’s securities.  The Company will have the right to recover, or receive reimbursement for, any compensation or profit realized on the disposition of Shares received for Restricted Units to the extent that the Company has a right of recovery or reimbursement under applicable securities laws.
 
18.            Plan Terms Govern.   The redemption of Restricted Units, the disposition of any Shares received for Restricted Units, and the treatment of any gain on the disposition of these Shares are subject to the terms of the Plan and any rules that the Committee may prescribe.  The Plan document, as may be amended from time to time, is incorporated into this Award Agreement.  Capitalized terms used in this Award Agreement have the meaning set forth in the Plan, unless otherwise stated in this Award Agreement.  In the event of any conflict between the terms of the Plan and the terms of this Award Agreement, the Plan will control.  By accepting the Award, you acknowledge receipt of the Plan and the prospectus, as in effect on the date of this Award Agreement.
 
19.            Personal Data.   To comply with applicable law and to administer the Plan and this Award Agreement properly, the Company and its agents may hold and process your personal data and/or sensitive personal data.  Such data includes, but is not limited to, the information provided in this grant package and any changes thereto, other appropriate personal and financial data about you, and information about your participation in the Plan and Shares obtained under the Plan from time to time.  By accepting the Award, you hereby give your explicit consent to the Company’s processing any such personal data and/or sensitive personal data.  You also hereby give your explicit consent to the Company’s transfer of any such personal data and/or sensitive personal data outside the country in which you work or reside and to the United States.  The legal persons for whom your personal data are intended include the Company and any of its Subsidiaries (or former Subsidiaries as are deemed necessary), the outside Plan administrator as selected by the Company from time to time, and any other person that the Company may find in
 
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its administration of the Plan to be appropriate.  You have the right to review and correct your personal data by contacting your local Human Resources Representative.  You understand that the transfer of the information outlined here is important to the administration of the Plan, and that failure to consent to the transmission of such information may limit or prohibit your participation in the Plan.
 
20.            No Contract of Employment or Promise of Future Grants.   By accepting the Award, you agree to be bound by the terms and conditions of this Award Agreement and acknowledge that the Award is granted at the sole discretion of the Company and is not considered part of any contract of employment with the Company or of your ordinary or expected salary or other compensation and will not be considered as part of such salary or compensation for purposes of any pension benefits or in the event of severance, redundancy or resignation.  If your employment with the Company or a Subsidiary is terminated for any reason, whether lawfully or unlawfully, you agree that you will not be entitled by way of damages for breach of contract, dismissal or compensation for loss of office or otherwise to any sum, shares or other benefits to compensate you for the loss or diminution in value of any actual or prospective rights, benefits or expectation under or in relation to the Plan.
 
21.            Limitations.   Nothing in this Award Agreement or the Plan gives you any right to continue in the employ of the Company or any of its Subsidiaries or to interfere in any way with the right of the Company or any Subsidiary to terminate your employment at any time.  Payment of your Restricted Units is not secured by a trust, insurance contract or other funding medium, and you do not have any interest in any fund or specific asset of the Company by reason of this Award or the account established on your behalf.  You have no rights as a stockholder of the Company pursuant to the Restricted Units until Shares are actually delivered to you.
 
22.            Incorporation of Other Agreements.   This Award Agreement and the Plan constitute the entire understanding between you and the Company regarding the Restricted Units.  This Award Agreement supercedes any prior agreements, commitments or negotiations concerning the Restricted Units.
 
23.            Severability.   The invalidity or unenforceability of any provision of this award Agreement will not affect the validity or enforceability of the other provisions of the Agreement, which will remain in full force and effect.  Moreover, if any provision is found to be excessively broad in duration, scope or covered activity, the provision will be construed so as to be enforceable to the maximum extent compatible with applicable law.
 
24.           Delayed Payment.   Notwithstanding anything in this Award Agreement to the contrary, if the Employee (i) is subject to US Federal income tax on any part of the payment of the Restricted Units, (ii) is a “specified employee” within the meaning of section 409A(a)(2)(B) of the Internal Revenue Code and the regulations thereunder, and (iii) is or will become eligible for Retirement or Normal Retirement prior to the Normal Vesting of some or all of the Restricted Units, then any payment of Restricted Units that is made on account of his separation from service within the meaning of section 409A(a)(2)(A)(i) of the Internal Revenue Code and the regulations thereunder shall be delayed until six months following such separation from service.
 
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By accepting this Award, you agree to the following:
 
(i)             you have carefully read, fully understand and agree to all of the terms and conditions described in this Award Agreement and the Plan; and
 
(ii)            you understand and agree that this Award Agreement and the Plan constitute the entire understanding between you and the Company regarding the Award, and that any prior agreements, commitments or negotiations concerning the Restricted Units are replaced and superseded.
 
You will be deemed to consent to the application of the terms and conditions set forth in this Award Agreement and the Plan unless you contact Tyco Electronics, Ltd., c/o Equity Plan Administration, 1050 Westlakes Drive, Berwyn, PA 19312 in writing within thirty (30) days of the date of this Award Agreement.  Notification of your non-consent will nullify this grant unless otherwise agreed to in writing by you and the Company.

 	Thomas J. Lynch	
 	Chief Executive Officer,	
 	Tyco Electronics, Ltd.	
 
7

EXHIBIT 10.16

TYCO ELECTRONICS LTD.
DEFERRED COMPENSATION PLAN FOR DIRECTORS
 
Effective September 26, 2007

 
ARTICLE 1
PURPOSE
 
1.1          Deferred Compensation Plan for Directors.  Tyco Electronics Ltd. hereby adopts the Tyco Electronics Ltd. Deferred Compensation Plan for Directors, effective September 26, 2007, to allow outside directors of the Company the opportunity to defer the receipt of compensation that would otherwise be payable to them.  The Company intends that the Plan will at all times be maintained on an unfunded basis for Federal income tax purposes under the Code.  The provisions of this Plan shall apply to Compensation Deferrals beginning on or after September 26, 2007 and to any earnings or dividend equivalents credited thereon.
 
1.2          Compliance with Code Section 409A.  The terms of this Plan are intended to, and shall be interpreted and applied so as to comply in all respects with the provisions of Code Section 409A and regulations and rulings thereunder.
 
ARTICLE 2
DEFINITIONS
 
The following words and terms shall have the indicated meanings wherever they appear in the Plan:
 
2.1          “Administrator” means the person or persons named as such by the Committee or its designee, or if no such designee is named, the Senior Vice President of Human Resources of the Company.
 
2.2          “Annual Deferral Amount” means that portion of a Participant’s Compensation for any calendar year that a Participant elects to have deferred and is actually deferred.  All cash deferrals are made in U.S. dollars.
 
2.3          “Beneficiary” or “Beneficiaries” means the person or persons designated by the Participant to receive payments under this Plan in the event of the Participant’s death as provided in Section 4.4.
 
2.4          “Board of Directors,” “Directors,” or “Director” means, respectively, the Board of Directors, the Directors, or a Director of the Company.  Director shall also mean any former Director during the period immediately following service as a Director while he/she is in the role of a paid advisor.
 
2.5          “Cash Account” means the account maintained on the books of the Company used solely to calculate the amount payable to each Participant who defers cash Compensation under this Plan to such account and shall not constitute a separate fund of assets.
 
2.6          “Code” means the Internal Revenue Code of 1986, as amended.
 
2.7          “Committee” means the Management Development and Compensation Committee of the Board of Directors.
 
2.8          “Company” means Tyco Electronics Ltd.

 
2.9          “Compensation” means that portion of a Director’s retainer and/or meeting fees payable in cash, or DSUs granted to a Director for any reason, but does not include travel expense allowance or any other expense reimbursement.
 
2.10        “Compensation Deferral(s)” means that portion of Compensation as to which a Participant has made an annual irrevocable election to defer receipt pursuant to Article III.
 
2.11        “Deferral Year” means any calendar year commencing on or after January 1, 2008 for which a Participant elects to have some or all of his/her Compensation deferred in accordance with Section 3.2.
 
2.12        “Deferred Stock Unit” or “DSU” means an award of deferred stock units granted under and subject to the terms of the Tyco Electronics Ltd. 2007 Stock and Incentive Plan and any award agreement thereunder.
 
2.13        “Disability” means that a Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.
 
2.14        “Measurement Funds” means one or more of the independently established funds or indices that are identified by the Committee and listed in Appendix A.  These Measurement Funds are used solely to calculate the earnings that are credited to each Participant’s Cash Account(s) in accordance with Section 3.3, and do not represent any beneficial interest on the part of the Participant in any asset or other property of the Company.  The determination of the increase or decrease in the performance of each Measurement Fund shall be made by the Administrator in its reasonable discretion.  Measurement Funds may be replaced, new funds may be added, or both, from time to time in the discretion of the Committee.
 
2.15        “Notice Form” means the form attached hereto and marked as Appendix B or any other document which incorporates information substantially similar to Appendix B.
 
2.16        “Participant” means each non-employee Director of the Company who participates in the Plan in accordance with its terms and conditions.
 
2.17        “Plan” means the Tyco Electronics Ltd. Deferred Compensation Plan for Directors as set forth herein, or as it may be amended from time to time by the Board of Directors.  The effective date of this Plan is September 26, 2007.
 
2.18        “Stock Account” means the account maintained on the books of the Company used solely to calculate the amount distributable to each Participant who defers Compensation under this Plan in the form of whole or fractional stock units and shall not constitute a separate fund of assets.
 
2.19        “Stock Unit” means a unit with an equivalent value to one (1) share of Company common stock and which is credited to a Participant’s Stock Account.
 
2.20        “Time Certain Payout” means the payout form described in Section 4.1.
 
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2.21        “Trust” shall mean the trust arrangement, if any, between the Company and the trustee named therein, as amended from time to time.
 
ARTICLE 3
PARTICIPATION
 
3.1          Eligibility .  Each non-employee Director is eligible to participate in the Plan by filing an election in accordance with Section 3.2.
 
3.2          Notice Form Timing and Duration.  A Director may elect to participate in the Plan by filing a properly completed Notice Form with the Administrator.  In order to defer compensation for any Deferral Year, a Notice Form must be filed with the Administrator on or before December 31 st of the year preceding the Deferral Year and must be irrevocable for the full Deferral Year.   Notwithstanding the previous sentence, a newly-appointed Director may elect to defer Compensation by filing a Notice Form with the Administrator no later than 30 days after the date on which he/she becomes a Director, but such Notice Form will only be effective for compensation payable on and after the first day of the calendar quarter following the date on which the Notice Form is filed and such Notice Form will be irrevocable for the remainder of the Deferral Year.   In addition, a Director who received a Founders’ Grant of DSUs on July 2, 2007 may file a Notice Form with the Administrator on or before December 31, 2007 making a deferral election with respect to such DSUs; provided, that no such election shall be effective until January 1, 2008.  Once filed with the Administrator, a Notice Form shall remain in effect until the earlier of (i) the termination of the Participant’s services as a Director, or (ii) the last day of the Deferral Year.
 
3.3          Compensation Deferral.   A Participant may elect on the Notice Form that the payment of all or a specified portion of the Compensation otherwise payable to him/her with respect to a Deferral Year for services as a Director be deferred until such time as elected by the Participant pursuant to the terms of this Plan.   Any Compensation earned by a Director that is not deferred under the Plan shall be paid to the Director in accordance with normal Company policy and the applicable terms of any Company plan and any grant agreement thereunder.
 
3.4          Investment Measurements.    At the time that a Participant makes an election to defer cash Compensation under the Plan, the Participant shall elect the manner in which the Annual Deferral Amount shall be deemed to be invested under the Plan.   Any Compensation in the form of DSUs for which a deferral election is made will automatically be credited to the Participant’s Stock Account at the time shares would have been payable under the terms of such DSU but for such deferral election.  The Participant may change and/or make new investment elections in accordance with procedures established by the Administrator.
 
(a)           A Participant may elect to invest all or a specified portion of his/her Cash Account in some or all of the Measurement Funds listed in Appendix A, to the extent the Committee makes such investment alternatives available under the Plan.  The specified portion of a Cash Account that is deemed invested in a Measurement Fund shall be adjusted for investment experience (either gains or losses) in a manner that equals the investment experience attributable to such investment.  Deemed investments in a Measurement Fund shall be credited and debited in accordance with procedures established by the Administrator.  In the event that a
 
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Participant does not submit a complete and accurate investment election, the Cash Account shall be deemed invested in the Interest Income Measurement Fund or, if none, as determined by the Administrator. 
 
(b)           A Participant may elect to convert his/her deferred cash Compensation to Stock Units and to have such Stock Units invested in the Participant’s Stock Account as of the date on which such cash Compensation would otherwise have been payable but for the Participant’s deferral election.  The number of Stock Units credited to the Stock Account in such case shall be equal to the amount of the cash Compensation so deferred divided by the fair market value of a share of Company stock on such date.  Once deferred cash Compensation is converted to Stock Units, it must remain deferred in the form of Stock Units until payment.
 
(c)           The Company shall not be required to acquire any securities in connection with deemed investment elections under this Plan.   No Participant shall have any right to receive a distribution in kind from the Plan with respect to the Participant’s Cash Account or to have the right to vote any security in which a Participant’s Cash Account is deemed invested.  All distributions from a Participant’s Stock Account shall be made in the form of whole shares of Company stock corresponding to the number of Stock Units to be distributed (with cash being distributed in lieu of fractional Stock Units).
 
(d)           Each Participant shall receive a statement of the balance of his/her Cash Account and Stock Account at least annually or within a reasonable period following the Administrator’s receipt of a request for a statement.
 
3.5          Dividend Equivalents.   As of each date on which a cash dividend is paid on Company stock, there shall be credited to each Participant’s Stock Account that number of Stock Units (including fractional units) determined by (i) multiplying the amount of such dividend (per share) by the number of Stock Units in such Stock Account on the record date for such dividend; and (ii) dividing the total so determined by the fair market value of a share of Company stock on the date of payment of such cash dividend.  The additions to a Director’s Stock Account pursuant to this Section 3.5 shall continue until the Director’s Stock Account is fully distributed in accordance with Article 4 below. 
 
ARTICLE 4
PAYMENTS TO PARTICIPANTS
 
4.1          Time and Form of Payment.   (a) At the election of the Participant, which shall be made on the Notice Form applicable to each Annual Deferral Amount, payment or distribution of each such Annual Deferral Amount, as adjusted for the investment results or dividend equivalent accruals thereon, as applicable, shall be made (i) in substantially equal annual installments over a number of years not to exceed ten (10) years or (ii) in a lump sum cash payment or total distribution.  Such payment or distribution will be made or will commence, as applicable, either (i) within the period that is sixty (60) days after the end of the calendar year in which the Director terminates service from the Board or (ii) as a Time Certain Payout within sixty (60) days after the first day of the calendar year, as elected by the Participant, that is at least five (5) years after the first day of the calendar year to which the applicable Annual Deferral Amount election relates.  In no event may the distribution or commencement of distribution of a
 
5

 
Participant’s Stock Account occur before the participant’s termination of service from the Board. Notwithstanding the Participant’s election of a Time Certain Payout (or any change in payment election described in Section 4.2), any unpaid Annual Deferral Amounts, as adjusted for the investment results or dividend accruals thereon, as applicable, will be paid to the Participant in a lump sum cash payment or total distribution, as applicable, within the period that is sixty (60) days after the end of the calendar year in which occurs the later of (i) the Participant’s attainment of age seventy and (ii) the Participant’s termination of service from the Board. 
 
(b)           In the absence of an election as to the time and form of the payment of an Annual Deferral Amount with respect to a deferral of cash Compensation, such Annual Deferral Amount shall be paid to the Participant in a lump sum payment or total distribution, as applicable, within the period that is sixty (60) days after the first day of the calendar year that is five (5) years after the first day of the calendar year to which the applicable Annual Deferral Amount election relates.
 
(c)           In the absence of an election as to the time and form of the distribution of an Annual Deferral Amount with respect to a deferral of DSUs, such Annual Deferral Amount shall be distributed to the Participant in substantially equal annual installments over five (5) years, with the first such distribution commencing within the period that is sixty (60) days after the Participant’s termination of service from the Board.
 
4.2          Change in Election.  A Participant may postpone the payment date for an Annual Deferral Amount, by filing a new payment election, in the form specified by the Administrator, at least twelve (12) months prior to the original payment date and twelve (12) months prior to termination.  Under the new election, the Participant may postpone the payment of the Annual Deferral Amount so that it will be paid (or commence payment or distribution, as applicable) (a) within sixty (60) days of the first day of the calendar year that is at least five (5) years after the original payment date or (b) within the period that is sixty (60) days after the calendar year in which the Director terminates service from the Board, provided that in no event may any payment under such election occur before the date that is at least five (5) years after the original payment date.
 
4.3          Death or Disability Benefit/Beneficiary Designation.   (a) Upon the death or Disability of a Participant, the Participant or the Participant’s Beneficiary, as applicable, shall be paid the balance in his or her Cash Account or Stock Account in the form of a lump sum payment or total distribution, as applicable, with such payment to be made as soon as practicable after the Participant’s death or Disability.
 
(b)           Each Participant may designate in writing a Beneficiary or Beneficiaries (which Beneficiary may be an entity other than a natural person) to receive any payments which may be made under the Plan following the Participant’s death.  No Beneficiary designation shall become effective until it is in writing and it is filed with the Administrator.  Such designation may be changed or canceled by the Participant at any time without the consent of any such Beneficiary.  Any such designation, change or cancellation must be made in a form approved by the Administrator and shall not be effective until received by the Administrator, or its designee.  If no Beneficiary has been named, or the designated Beneficiary or Beneficiaries shall have predeceased the Participant, the Beneficiary shall be deemed to be the Participant’s estate.  If a
 
6

 
Participant designates more than one Beneficiary, the interests of such Beneficiaries shall be paid in equal shares, unless the Participant has specifically designated otherwise.
 
4.4          Valuation of Cash Payments.  Any lump sum cash payment of an Annual Deferral Amount shall be made in an amount equal to the value of the portion of the Participant’s Cash Account attributable to such Annual Deferral Amount and the investment results thereon as of January 1 of the calendar year that includes the relevant payment date, with the Measurement Funds being deemed to have been liquidated on that date to make the payment.
 
4.5          Effect of Payment.   The full payment of the Participant’s Cash Account and Stock Account under this Article IV shall completely discharge all obligations on the part of the Company to the Participant (and each Beneficiary) with respect to the operation of this Plan, and the Participant’s (and Beneficiary’s) rights under this Plan shall terminate.
 
ARTICLE 5
GENERAL
 
5.1          Unsecured Obligation of Company.   The right of any Participant, beneficiary, or estate to receive payment of any unpaid balance in any Cash Account or Stock Account of the Participant shall be an unsecured claim against the general assets of the Company.  No Participant or other person shall have any right or claim to the payment of any amount that is in any manner superior or different from the right or claim of a general and unsecured creditor of the Company.
 
5.2          Nonalienation of Benefits.   During a Participant’s lifetime, any payment under the Plan shall be made only to him/her.  No sum or other interest under the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt by a Participant or any beneficiary under the Plan to do so shall be void.  No interest under the Plan shall in any manner be liable for or subject to the debts, contracts, liabilities, engagements, or torts of a Participant or beneficiary entitled thereto.
 
5.3          Plan Administration.   Except as otherwise provided herein, the Plan shall be administered by the Administrator which shall have the full discretionary power and authority to administer the Plan, including without limitation, the power and authority to:  (i) construe the Plan’s terms; (ii) make factual determinations; (iii) prepare forms to be used for making elections under the Plan; (iv) establish rules and procedures for administering and operating the Plan; (v) evaluate requests made by Participants; (vi) correct defects under the Plan; (viii) establish the manner in which decisions are made by the Administrator; (ix) retain such legal, actuarial, accounting, clerical, and other services as may be necessary to operate and administer the Plan; (x) establish recordkeeping procedures for the Plan; and (xi) take any and all similar actions to the extent necessary to administer the Plan.  The Administrator may delegate all or some of its authority under the Plan to any other person or entity.  Any findings or determinations made by the Administrator in the administration of the Plan shall be final, conclusive, and binding on all parties.
 
5.4          Plan Amendment/Termination .  The Plan may at any time or from time to time be amended, modified, or terminated by the Board of Directors, provided that no amendment,
 
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modification, or termination shall adversely affect the balance in a Participant’s Cash Account or Stock Account without his/her consent.  In addition, the Plan, and/or the terms of any election made hereunder, may be amended at any time and in any respect by the Company or by the Plan Administrator if and to the extent recommended by counsel in order to conform to the requirements of Code Section 409A and regulations thereunder.  In the event of any suspension or termination of the Plan, payment of Participants’ Cash Accounts and Stock Accounts shall be made under and in accordance with the terms of the Plan and the applicable elections (except that the Plan Administrator may determine, in its sole discretion, to accelerate payments to all Participants if and to the extent that such acceleration is permitted under Code Section 409A and regulations thereunder).
 
5.5          No Additional Rights.   Nothing contained herein shall be deemed to give any Director the right to be retained in the service of the Company.
 
5.6          Governing Law.   This Plan shall be governed by and construed in accordance with the laws of the Commonwealth of Bermuda, notwithstanding the conflict of law rules applicable therein. 
 
5.7          Company’s Right to Offset.   If a Participant becomes entitled to a distribution of benefits under the Plan, and if at such time the Participant has outstanding any debt, obligation, or other liability representing an amount owing to the Company, then the Company may offset such amount owed to it against the amount of benefits otherwise distributable.
 
ARTICLE 6
TRUST
 
6.1          Establishment of Trust.   The Company may establish a Trust, and the Company may, at least annually, transfer over to the Trust such assets, if any, as the Company determines, in its sole discretion, are necessary to provide for the liabilities created with respect to the Plan for that year.  The trustees of the Trust shall be selected by the Company from time to time.
 
6.2          Governing Documents.   The provisions of the Plan shall govern the rights of a Participant to receive distributions pursuant to the Plan.  The provisions of the Trust, if any, shall govern the rights of the Participant and the creditors of the Company to any assets transferred to the Trust.  The Company shall at all times remain liable to carry out its obligations under the Plan.  The Company’s obligations under the Plan may be satisfied with Trust assets distributed pursuant to the terms of the Trust.
 
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APPENDIX A
MEASUREMENT FUNDS
(as of September 29, 2007)
 
Interest Income Measurement Fund
 
U.S. Equity Index Commingled Measurement Fund
 
A-1

EXHIBIT 10.23
 
TYCO ELECTRONICS LIMITED

RULES
 
OF
 
TYCO ELECTRONICS LIMITED SAVINGS RELATED SHARE PLAN

Approved by a board/shareholder resolution on: 30 June 2007
 
Approved by HM Revenue & Customs on: 23 November 2007
 
HM Revenue & Customs reference no: TLS/LE51/CD/ND

PricewaterhouseCoopers LLP
Plumtree Court
London EC4A 4HT

 	Tel:	 	020 7583 5000	 	
 	Fax:	 	020 7822 4652	 	
 	Ref:	 	CD/SQ/HA	 	

 
CONTENTS

Rule		Page
Number	
 	 		
1.	INTERPRETATION	3	
 	1.1.	Definitions	3	
 	1.2.	Interpretation	6	
2.	INVITATIONS TO APPLY FOR, AND APPLICATIONS FOR, GRANT OF OPTIONS	7	
 	2.2.	Persons to whom Invitations must be issued	7	
 	2.3.	Documents which must accompany Invitation	7	
 	2.4.	Contents of Invitation	7	
 	2.5.	Contents of Application Form	8	
 	2.6.	Number of Plan Shares applied for in Application	8	
 	2.7.	Making of Applications	9	
3.	 	GRANT OF OPTIONS	9	
 	3.1.	Options granted by Company or Trustees	9	
 	3.2.	Persons to whom Options must be granted	9	
 	3.3.	Procedure for grant of Options and Grant Date	9	
 	3.4.	Contents of Option Certificate	9	
 	3.5.	Number of Plan Shares over which Options granted	9	
 	3.6.	Scaling down of Applications	9	
 	3.7.	Period allowed for grant of Options	10	
 	3.8.	Duration of Plan	10	
 	3.9.	Persons to whom Options may be granted	10	
 	3.10.	Options non-transferable	10	
4.	 	LIMIT ON AGGREGATE NUMBER OF PLAN SHARES PLACED UNDER OPTION	11	
 	4.1.	Power to set limit	11	
5.	 	EXERCISE PRICE	11	
6.	 	EXERCISE OF OPTIONS	11	
 	6.1.	Earliest date for exercise of Options	11	
 	6.2.	Latest date for exercise of Options	11	
 	6.3.	Persons who may exercise Options	11	
 	6.4.	Material Interest	11	
 	6.5.	Number of Plan Shares acquired on exercise of Options	11	
 	6.6.	Options may be exercised in whole or in part	12	
 	6.7.	Procedure for exercise of Options	12	
 	6.8.	Issue or transfer of Plan Shares on exercise of Options	12	
 	6.9.	Amount of repayment under Savings Contract	12	
7.	 	EXERCISE OF OPTIONS IN SPECIAL CIRCUMSTANCES	12	
 	7.1.	Death	12	
 	7.2.	Injury, disability, redundancy, retirement etc	12	
 	7.3.	Specified Age	13	
 	7.4.	Other special circumstances	13	
 	7.5.	Office or employment in Group Company	13	
 	7.6.	Termination of Savings Contract	13	
 	7.7.	Meaning of ceasing to be in Relevant Employment	13	
 	7.8.	Interaction of Rules	14	
8.	 	TAKEOVER, RECONSTRUCTION, AMALGAMATION OR WINDING-UP OF COMPANY	14	
 	8.1.	General offer for, or acquisition of, Company	14	
 	8.2.	Compulsory acquisition of Company	14	
 	8.3.	Reconstruction or amalgamation of Company	14	
 	8.4.	Winding-up of Company	15	
 	8.5.	Shares subject to Options ceasing to be Plan Shares	15	
 	8.6.	Meaning of “obtains Control of the Company”	15	
 	8.7.	Notification of Option Holders	15	
9.	EXCHANGE OF OPTIONS	15	

 

 	9.1.	Circumstances in which Exchange can occur	15	
 	9.2.	Period allowed for exchange of Options	16	
 	9.3.	Meaning of “equivalent”	16	
 	9.4.	Grant Date of New Option	16	
 	9.5.	Application of Plan to New Option	16	
10.	 	LAPSE OF OPTIONS	17	
11.	 	ADJUSTMENT OF OPTIONS ON REORGANISATION	17	
 	11.1.	Power to adjust Options	17	
 	11.2.	Exercise Price	17	
 	11.3.	Capitalisation of reserves	17	
 	11.4.	HM Revenue & Customs approval	18	
 	11.5.	Notification of Option Holders	18	
12.	 	ISSUE AND AVAILABILITY OF PLAN SHARES	18	
 	12.1.	Rights attaching to Plan Shares	18	
 	12.2.	Availability of Plan Shares	18	
13.	 	RELATIONSHIP OF PLAN TO CONTRACT OF EMPLOYMENT	18	
 	13.1.	Contractual Provisions	18	
14.	 	ADMINISTRATION OF PLAN	19	
 	14.1.	Responsibility for administration	19	
 	14.2.	Grantor’s decision final and binding	19	
 	14.3.	Trustees to consult with Board	19	
 	14.4.	Provision of information	19	
 	14.5.	Cost of Plan	19	
 	14.6.	Establishment of separate plans for overseas territories	19	
 	14.7.	Data protection	20	
15.	 	AMENDMENT OF PLAN	20	
 	15.1.	Power to amend Plan	20	
 	15.2.	HM Revenue & Customs approval of amendments	20	
 	15.3.	Rights of existing Option Holders	20	
 	15.4.	Notification of Option Holders	20	
16.	 	NOTICES	20	
 	16.1.	Notice by Grantor	20	
 	16.2.	Deceased Option Holders	20	
 	16.3.	Notice to Grantor	21	
 	16.4.	Option Certificate and Notice of Option	21	
17.	 	GOVERNING LAW AND JURISDICTION	21	
 	17.1.	Plan governed by English law	21	
 	17.2.	English courts to have jurisdiction	21	
 	17.3.	Jurisdiction agreement for benefit of Company	21	
 	17.4.	Option Holder deemed to submit to such jurisdiction	21	

 
1.                               INTERPRETATION
 
1.1.                     Definitions
 
In this Plan, unless the context otherwise requires, the following words and expressions have the following meanings:
 
1.1.1.                      Acquiring Company means a company (including a New Holding Company) which obtains Control of the Company in the circumstances referred to in Rule 8.1, 8.2 or 8.3 (reading the reference in Rule 8.3 to “proposes to obtain” as “obtains”);
 
1.1.2.                      Acting In Concert has the meaning given to that expression in The City Code on Takeovers and Mergers in its present form or as amended from time to time;
 
1.1.3.                      Adoption Date means the date on which the Plan is adopted by the Board;
 
1.1.4.                      Applicant means an Eligible Employee who applies for the grant of an Option;
 
1.1.5.                      Application means an application for the grant of an Option;
 
1.1.6.                      Application Form means the form referred to in Rule 2.3 on which an application for the grant of an Option is made;
 
1.1.7.                      Approval Date means the date on which the Plan is approved by HM Revenue & Customs under Schedule 3;
 
1.1.8.                      Associated Company has the meaning given to that expression by paragraph 47 of Schedule 3 or, where the context requires, paragraph 35(4) of Schedule 3;
 
1.1.9.                      Board means the board of directors of the Company or a duly authorised committee thereof;
 
1.1.10.                Bonus Date means
 
(a)                                   in the case of a three year Savings Contract, the earliest date on which a Standard Bonus would be payable under the Savings Contract; and
 
(b)                                  in the case of a five year Savings Contract, the earliest date on which a Standard Bonus or a Maximum Bonus would be payable under the Savings Contract, according to whether, for the purpose of determining the number of Plan Shares over which the Option linked to the Savings Contract was granted, the repayment under the Savings Contract is to be taken as including the Standard Bonus (or no bonus) or the Maximum Bonus, respectively;
 
1.1.11.                Close Company has the meaning given to that expression by section 414(1) of ICTA 1988, and paragraph 11(4) of Schedule 3;
 
1.1.12.                Company means Tyco Electronics Limited incorporated in Bermuda under company number {CoRefNo}, being the scheme organiser for the purposes of paragraph 2(2) of Schedule 3;
 
1.1.13.                Consortium has the meaning given to that word by paragraph 48(2) of Schedule 3;
 
1.1.14.                Constituent Company means the Company or a company which is a Subsidiary and which has been nominated by the Board to participate in the Plan from time to time;
 
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1.1.15.                Continuous Employment has the meaning given by the Employment Rights Act 1996:
 
1.1.16.                Control has the meaning given to that word by section 840 of ICTA 1988;
 
1.1.17.                Eligible Employee means an individual who is:
 
(a)                                   an employee (other than a director) of a Constituent Company; or
 
(b)                                  a director of a Constituent Company who is contracted to work at least 25 hours per week for the Group (exclusive of meal breaks);
 
and who, in either case:
 
(i)                                      is not eligible solely by reason that he is a non-executive director of a Constituent Company;
 
(ii)                                   has earnings in respect of his office or employment which are (or would be if there were any) general earnings to which section 15 or 21 of ITEPA 2003 applies ;
 
(iii)                                has at the Grant Date such period of Continuous Employment as a director or employee, not exceeding five years, as the Grantor determines for the purpose of an issue of Invitations;
 
(iv)                               has not given or been given notice to terminate his employment within the Group; and
 
(v)                                  does not have at the Grant Date, and has not had during the preceding twelve months, a Material Interest in a Close Company which is the Company or a company which has Control of the Company or a member of a Consortium which owns the Company; or
 
(c)                                   a director (other than a non executive director) or employee of a Constituent Company nominated by the Grantor to be an Eligible Employee who is not prohibited from participating in the Plan by sub paragraph (v) above;
 
1.1.18.                Employees’ Share Scheme has the meaning set out in section 743 of the Companies Act 1985 or the corresponding section in the Companies Act 2006;
 
1.1.19.                Exercise Price means the amount per Plan Share payable on the exercise of an Option determined in accordance with Rule 5;
 
1.1.20.                Grant Date means the date on which an Option is granted to an Eligible Employee determined in accordance with Rule 3.3;
 
1.1.21.                Grantor means
 
(a)                                   in relation to an Option granted by the Company, the Board; and
 
(b)                                  in relation to an Option granted by the Trustees, the Trustees;
 
1.1.22.                Group means the Company and all Subsidiaries and Associated Companies of the Company and “ Group Member ” shall be construed accordingly;
 
1.1.23.                ICTA 1988 means the Income and Corporation Taxes Act 1988;
 
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1.1.24.                Invitation means an invitation to apply for the grant of an Option issued under Rule 2.2;
 
1.1.25.                Invitation Date means the date on which an Invitation is issued;
 
1.1.26.                ITEPA 2003 means the Income Tax (Earnings and Pensions) Act 2003;
 
1.1.27.                ITTOIA 2005 means the Income Tax (Trading and Other Income) Act 2005;
 
1.1.28.                Key Feature means a provision of the Plan which is necessary in order to meet the requirements of Schedule 3;
 
1.1.29.                Market Value means
 
(a)                                   if at the relevant time Plan Shares are listed on the New York Stock Exchange (or any other recognised investment exchange within the meaning of section 841 of ICTA 1988), the closing quotation of a Plan Share (as derived from the New York Stock Exchange or the list appropriate to such other exchange or market) for the trading day immediately preceding the Invitation Date; or
 
(b)                                  if at the relevant time Plan Shares are not so listed, the market value of a Plan Share as determined in accordance with Part VIII of the Taxation of Chargeable Gains Act 1992 and agreed in advance by the Grantor with HM Revenue & Customs Shares & Assets Valuation on the Invitation Date or such earlier date or dates as may be agreed with HM Revenue & Customs;
 
1.1.30.                Material Interest has the meaning given to that expression by paragraphs 11 and 12 to 16 of Schedule 3;
 
1.1.31.                Maximum Bonus means the bonus which is payable under a five year Savings Contract, at the earliest, seven years after the starting date of the Savings Contract;
 
1.1.32.                Minimum Monthly Savings Amount means in relation to each Invitation, the minimum monthly saving which may be made by an Option Holder as determined by the Board in accordance with paragraph 25(3)(b) of Schedule 3 being not less than £5 (or such other minimum savings amount specified from time to time by HM Treasury in their Save-As-You-Earn prospectus) nor more than £10 (or such other amount as may be permitted from time to time under paragraph 25(3)(b) of Schedule 3);
 
1.1.33.                New Holding Company means a company which obtains Control of the Company where 90% or more of the New Holding Company’s ordinary shares are held in substantially the same proportions by substantially the same persons who previously held the Company’s ordinary shares;
 
1.1.34.                New Option means an option granted by way of exchange under Rule 9.1;
 
1.1.35.                New Plan Shares means the shares subject to a New Option;
 
1.1.36.                New York Stock Exchange means the New York Stock Exchange or any successor body;
 
1.1.37.                Notice of Exercise means the notice given in respect of the exercise of an Option under Rule 6.7;
 
1.1.38.                Option means a right to acquire Plan Shares granted under the Plan;
 
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1.1.39.                Option Certificate means the deed or statement under which an Option is granted in accordance with Rule 3.3;
 
1.1.40.                Option Holder means an individual who holds an Option or, where the context permits, his legal personal representatives;
 
1.1.41.                Plan means Tyco Electronics Limited Savings Related Share Plan{PLANNAME} in its present form or as amended from time to time;
 
1.1.42.                Plan Shares means ordinary shares in the capital of the Company (or any shares representing them) which satisfy the conditions in paragraphs 18 to 22 of Schedule 3;
 
1.1.43.                Relevant Employment means employment with any Group Member;
 
1.1.44.                Reorganisation means any variation in the share capital of the Company, including but without limitation a capitalisation issue, rights issue, rights offer or bonus issue and a sub-division, consolidation or reduction in the capital of the Company but excluding a capitalisation issue in substitution for or as an alternative to a cash dividend;
 
1.1.45.                Rules mean the rules of the Plan;
 
1.1.46.                Savings Contract means a contract under a certified contractual savings scheme within the meaning of section 703 of ITTOIA  2005 which has been approved by HM Revenue & Customs for the purpose of Schedule 3;
 
1.1.47.                Schedule 3 means Schedule 3 to ITEPA 2003;
 
1.1.48.                Specified Age means 65 years;
 
1.1.49.                Standard Bonus means the earliest bonus which is payable under a Savings Contract;
 
1.1.50.                Subsidiary means a company which is a subsidiary of the Company within the meaning of section 736 of the Companies Act 1985, or the corresponding section in the Companies Act 2006, over which the Company has Control;
 
1.1.51.                Trustees means the trustees of any trust created by a Group Member which, when taken together with the Plan, constitutes an Employees’ Share Scheme;
 
1.2.                             Interpretation
 
In the Plan, unless otherwise specified:
 
1.2.1.                      the contents and rule headings are inserted for ease of reference only and do not affect the interpretation of the Plan;
 
1.2.2.                      a reference to a Rule is a reference to a rule of the Plan;
 
1.2.3.                      save as provided for by law and subject to Rule 16.4 a reference to writing includes any mode of reproducing words in a legible form and reduced to paper or electronic format or communication including, for the avoidance of doubt, correspondence via e-mail;
 
1.2.4.                      the singular includes the plural and vice versa and the masculine includes the feminine;
 
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1.2.5.                      a reference to a statutory provision includes any statutory modification, amendment or re-enactment thereof; and
 
1.2.6.                      the Interpretation Act 1978 applies to the Plan in the same way as it applies to an enactment.
 
2.                                      INVITATIONS TO APPLY FOR, AND APPLICATIONS FOR, GRANT OF OPTIONS
 
2.1.                            Announcement of intention to issue Invitations by Board or Trustees
 
The Board or the Trustees may, in their absolute discretion, from time to time, announce their intention to issue Invitations in accordance with this Rule 2 to Eligible Employees to apply for the grant of Options.
 
2.2.                             Persons to whom Invitations must be issued
 
If the Grantor announces its intention to issue Invitations, it shall issue an Invitation to every person who is, or will on the Grant Date be, an Eligible Employee.
 
2.3.                             Documents which must accompany Invitation
 
An Invitation shall be accompanied by:
 
2.3.1.                      an Application Form to be used by the recipient of the Invitation to apply for the grant of the Option referred to in the Invitation and to apply to enter into a Savings Contract approved by the Grantor for the purpose of that issue of Invitations and linked to the Option; and
 
2.3.2.                      a copy of the Rules.
 
2.4.                             Contents of Invitation
 
An Invitation shall state:
 
2.4.1.                      the date, being not less than 14 nor more than 21 days after the date of issue of the Invitation, by which the recipient of the Invitation must submit an Application;
 
2.4.2.                      the Minimum Monthly Savings Amount under the Savings Contract linked to the Option referred to in the Invitation;
 
2.4.3.                      the Exercise Price under the Option referred to in the Invitation or the method by which the Exercise Price will be determined and notified to Eligible Employees;
 
2.4.4.                      the maximum permitted aggregate monthly savings contribution under the Savings Contract linked to the Option referred to in the Invitation taken together with savings contributions by the Applicant under any other savings contract linked to any other Option or option granted under any other SAYE option scheme approved by HM Revenue & Customs under Schedule 3, being the lesser of £250 (or such other amount as may be permitted from time to time under paragraph 25(3)(a) of Schedule 3) and such other amount (being a multiple of £1 and not less than £5 (or such other minimum savings amount specified from time to time by HM Treasury in their Save-As-You-Earn prospectus)) as the Board may determine for the purpose of that issue of Invitations;
 
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2.4.5.                      whether an Applicant must enter into a three year or a five year Savings Contract or may choose either;
 
2.4.6.                      whether, for the purpose of determining the number of Plan Shares over which the Option referred to in the Invitation is to be granted, the repayment under the Savings Contract linked to the Option must be taken as including the Maximum Bonus, the Standard Bonus or no bonus or whether the recipient of the Invitation may choose any of these; and
 
2.4.7.                      the maximum total number of Plan Shares, if any, set by the Board under Rule 4.1 over which Options will be granted in response to that issue of Invitations.
 
Subject to this Rule 2, an Invitation shall be in such form as the Grantor may determine from time to time.
 
2.5.                             Contents of Application Form
 
An Application Form shall require an Applicant to state:
 
2.5.1.                      the monthly savings contribution (being a multiple of £1 and not less than £5 (or such other minimum savings amount specified from time to time by HM Treasury in their Save-As-You-Earn prospectus)) which he wishes to make under the Savings Contract linked to the Option referred to in the Invitation;
 
2.5.2.                      that his proposed monthly savings contribution, when added to any monthly savings contributions then being made by him under any other Savings Contract linked to an Option or to an option granted under any other SAYE option scheme approved by HM Revenue & Customs under Schedule 3, will not exceed the maximum permitted aggregate monthly savings contribution specified in the Invitation;
 
2.5.3.                      where appropriate, whether he wishes to enter into a three or five year Savings Contract, and, in the case of a five year Savings Contract, whether he wishes it to be linked to the Maximum Bonus or the Standard Bonus; and
 
2.5.4.                      where appropriate, whether, for the purpose of determining the number of Plan Shares over which the Option referred to in the Invitation is to be granted, he wishes the repayment under the Savings Contract linked to the Option to be taken as including a bonus or no bonus;
 
and shall authorise the Grantor to enter on the Application Form, on behalf of the Applicant, such monthly savings contribution, not exceeding the maximum stated on the Application Form, as the Grantor determines under Rule 3.6.
 
Subject to this Rule 2, an Application Form shall be in such form as the Grantor may determine from time to time.
 
2.6.                             Number of Plan Shares applied for in Application
 
An Application shall be deemed to be for the grant of an Option over the maximum whole number of Plan Shares which may be acquired at the Exercise Price out of the expected repayment (including any bonus where permitted under Rule 2.4.6 and requested by the Applicant pursuant to Rule 2.5.4) under the Savings Contract linked to the Option at the applicable Bonus Date.
 
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2.7.                             Making of Applications
 
The recipient of an Invitation who wishes to apply for the grant of the Option referred to in the Invitation shall submit to the Grantor, within the period specified in the Invitation, a duly completed Application Form.
 
3.                                       GRANT OF OPTIONS
 
3.1.                             Options granted by Company or Trustees
 
The Company or the Trustees may from time to time grant Options to Eligible Employees.
 
3.2.                             Persons to whom Options must be granted
 
The Grantor shall grant the Option referred to in each Invitation in respect of which the Grantor has received a valid Application and, where Rule 3.6.4 applies, which has been selected by lot.
 
3.3.                             Procedure for grant of Options and Grant Date
 
The Grantor shall grant an Option by passing a resolution. The Grant Date shall be the date on which the Grantor passes the resolution or such later date as is specified in the resolution and allowed by Rules 3.7 and 3.8. The grant of an Option or Options shall be evidenced by a deed executed by or on behalf of the Grantor. The deed or a statement providing details of the grant shall be issued to each Applicant who has been granted an Option as soon as reasonably practicable following the grant of the Option.
 
3.4.                             Contents of Option Certificate
 
An Option Certificate shall state:
 
•                                           the Grant Date;
 
•                                           the number of Plan Shares subject to the Option;
 
•                                           the Exercise Price; and
 
•                                           the Bonus Date, being the date on which the Option will ordinarily become exercisable.
 
Subject thereto, an Option Certificate shall be in such form as the Board may determine from time to time.
 
3.5.                             Number of Plan Shares over which Options granted
 
An Option shall be granted over the number of Plan Shares for which the Applicant is deemed under Rule 2.6 or 3.6, as appropriate, to have applied.
 
3.6.                             Scaling down of Applications
 
If the Grantor receives Applications for the grant of Options over a number of Plan Shares in excess of any of the limits in Rule 4, it shall, to the extent necessary to eliminate the excess, take the following steps in the following order or such other steps as it may agree in advance with HM Revenue & Customs:
 
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3.6.1.                      first, for the purpose of determining the number of Plan Shares over which the Option referred to in an Invitation is to be granted, it shall take the repayment under the Savings Contract linked to the Option as including the Standard Bonus instead of the Maximum Bonus;
 
3.6.2.                      secondly, it shall take the repayment under the Savings Contract linked to the Option as including no bonus instead of the Standard Bonus;
 
3.6.3.                      thirdly, it shall reduce pro rata the excess over £5 (or such other minimum savings amount specified from time to time by HM Treasury in their Save-As-You-Earn prospectus), or such greater amount as the Grantor may determine, of the monthly savings contribution selected by each Applicant;
 
3.6.4.                      fourthly, it shall select Applications by lot and each Application shall be deemed to be for a monthly savings contribution of £5 (or such other minimum savings amount specified from time to time by HM Treasury in their Save-As-You-Earn prospectus) only with the repayment under the Savings Contract linked to the Option taken as including no bonus.
 
Each Application shall be deemed to have been withdrawn or amended accordingly and the Grantor shall amend each Application Form to reflect any reduction in the bonus or the monthly savings contribution resulting therefrom.
 
For the purpose of applying this Rule 3.6, if an Applicant has made multiple Applications, the Applications shall be treated as a single Application and the monthly savings contributions applied for in the Applications shall be aggregated.
 
3.7.                             Period allowed for grant of Options
 
An Option may be granted only during the period of thirty days beginning on the earliest of the dates referred to in the definition of “Market Value” and used for the purpose of determining the Exercise Price or, if Rule 3.6 applies, during the period of forty two days beginning on the earliest of such dates.
 
3.8.                             Duration of Plan
 
An Option may not be granted
 
3.8.1.                      earlier than the Approval Date; nor
 
3.8.2.                      more than ten years after the Adoption Date.
 
3.9.                             Persons to whom Options may be granted
 
The Grantor may not grant an Option to an individual who is not an Eligible Employee on the Grant Date.
 
3.10.                      Options non-transferable
 
An Option shall be personal to the Eligible Employee to whom it is granted and, subject to Rule 7.1, shall not be capable of being transferred, charged or otherwise alienated and shall lapse immediately if the Option Holder purports to transfer, charge or otherwise alienate the Option.
 
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4.                                      LIMIT ON AGGREGATE NUMBER OF PLAN SHARES PLACED UNDER OPTION
 
4.1.                             Power to set limit
 
The Board may, in its absolute discretion, from time to time set a maximum limit on the total number of Plan Shares which may be placed under Option under the Plan in response to an issue of Invitations (but no such limit shall invalidate any Option granted prior to such limit being set).
 
5.                                       EXERCISE PRICE
 
The Exercise Price shall be determined by the Board and may be any price but shall not be less than the higher of:
 
(a)                                   eighty percent of the Market Value of a Plan Share; and
 
(b)                                  in the case of any Option which will be satisfied by the issue of new shares the nominal value of a Plan Share.
 
6.                                       EXERCISE OF OPTIONS
 
6.1.                             Earliest date for exercise of Options
 
Subject to Rules 7 and 8, an Option may not be exercised before the Bonus Date.
 
6.2.                             Latest date for exercise of Options
 
Subject to Rule 7.1, an Option may not be exercised more than six months after the Bonus Date and if not exercised by that date shall lapse immediately.
 
6.3.                             Persons who may exercise Options
 
Subject to Rule 7, an Option may be exercised only while the Option Holder is in Relevant Employment and if an Option Holder ceases to be in Relevant Employment, any Option granted to him shall lapse immediately. This Rule 6.3 shall apply where the Option Holder ceases to be in Relevant Employment in any circumstances (including, in particular, but not by way of limitation, where the Option Holder is dismissed unfairly, wrongfully, in breach of contract or otherwise).
 
6.4.                             Material Interest
 
An Option may not be exercised if the Option Holder then has, or has had within the preceding twelve months, a Material Interest in a Close Company which is the Company or which is a company which has Control of the Company or which is a member of a Consortium which owns the Company.
 
6.5.                             Number of Plan Shares acquired on exercise of Options
 
The number of Plan Shares which may be acquired on the exercise of an Option shall be limited to the maximum whole number which may be acquired at the Exercise Price out of the repayment (including any interest or bonus that has been taken into account in determining the number of Plan Shares over which the Option was granted) received by the Option Holder under the Savings Contract linked to the Option.
 
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6.6.                             Options may be exercised in whole or in part
 
An Option may, to the extent it has become exercisable, be exercised in whole or in part. If exercised in part, the unexercised part of the Option shall lapse.
 
6.7.                             Procedure for exercise of Options
 
6.7.1.                      An Option shall be exercised by the Option Holder delivering to the Grantor a duly completed Notice of Exercise in the form from time to time prescribed by the Grantor, specifying the number of Plan Shares in respect of which the Option is being exercised, and accompanied by evidence of the termination of the Savings Contract linked to the Option, payment in full for the Plan Shares (which shall not exceed the repayment, including any interest or bonus, received by the Option Holder under the linked Savings Contract) and, if available, the Option Certificate. Such payment may be made by the Option Holder or by the bank or building society with which the Savings Contract was made.
 
6.7.2.                      For the avoidance of doubt, the date of exercise of an Option shall be determined in accordance with Rule 16.3. If payment is made by cheque and the cheque fails to clear the Option shall be deemed never to have been exercised.
 
6.8.                             Issue or transfer of Plan Shares on exercise of Options
 
Subject to any necessary consents and to compliance by the Option Holder with the Rules, the Grantor shall, as soon as reasonably practicable and in any event not later than thirty days after the date of exercise of the Option, issue or transfer to the Option Holder, or procure the issue or transfer to the Option Holder of, the number of Plan Shares specified in the Notice of Exercise and shall deliver or procure the delivery to the Option Holder of a definitive share certificate in respect of such Plan Shares.
 
6.9.                             Amount of repayment under Savings Contract
 
For the purpose of Rules 6.5 and 6.7, the repayment received under a Savings Contract shall exclude the repayment of any contribution the due date for payment of which falls after any date on which the Option Holder ceases to be in Relevant Employment.
 
7.                                       EXERCISE OF OPTIONS IN SPECIAL CIRCUMSTANCES
 
7.1.                             Death
 
Notwithstanding Rules 6.1, 6.2 and 6.3, if an Option Holder dies before the Bonus Date, his personal representatives shall be entitled to exercise his Options at any time during the twelve month period after his death. If not so exercised, the Options shall lapse immediately.
 
Notwithstanding Rules 6.2 and 6.3, if an Option Holder dies during the period of six months after the Bonus Date, his personal representatives shall be entitled to exercise his Options at any time during the twelve month period after the Bonus Date. If not so exercised, the Options shall lapse immediately.
 
7.2.                             Injury, disability, redundancy, retirement etc
 
Subject to Rule 7.5, notwithstanding Rules 6.1 and 6.3, if an Option Holder ceases to be in Relevant Employment by reason of:
 
7.2.1.                      injury or disability;
 
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7.2.2.                      redundancy within the meaning of the Employment Rights Act 1996;
 
7.2.3.                      retirement on or after reaching the Specified Age or any other age at which he is bound to retire under the terms of his contract of employment;
 
7.2.4.                      his office or employment ceasing to be a Relevant Employment because
 
7.2.4.1.                                                             it is in a company which ceases to be a member of the Group; or
 
7.2.4.2.                                                             it relates to a business or part of a business which is transferred to a person who is not a member of the Group
 
he shall be entitled to exercise his Options at any time during the period of six months after the date he ceased to be in Relevant Employment except that in the case of cessation of employment by reason of a circumstance within Rules 7.2.1, 7.2.2 or 7.2.3 occurring within the six month period after an event to which Rule 7.2.4 applied he shall be entitled to exercise his Options within the six month period after such cessation of employment.
 
7.3.                             Specified Age
 
If an Option Holder continues to be employed after the date on which he reaches the Specified Age, he shall be entitled to exercise his Options at any time during the six month period thereafter. If not so exercised, the Options shall not lapse but shall be exercisable or not, as the case may be, in accordance with the rules of the Plan.
 
7.4.                             Other special circumstances
 
If an Option Holder ceases to be in Relevant Employment for a reason other than those referred to in Rules 7.1 and 7.2 and within three years after the Grant Date, the Option shall lapse immediately.
 
If an Option Holder ceases to be in Relevant Employment for a reason other than those referred to in Rules 7.1 and 7.2 and more than three years after the Grant Date, he shall be entitled to exercise the Option at any time during the six month period thereafter. If not so exercised, the Option shall lapse immediately.
 
7.5.                             Office or employment in Group Company
 
If, at the relevant Bonus Date, an Option Holder holds an office or employment in a company which is not a Constituent Company but which is a member of the Group he shall be entitled to exercise his Options at any time during the six month period thereafter.
 
7.6.                             Termination of Savings Contract
 
If an Option Holder gives, or is deemed under the terms of his Savings Contract to have given, notice that he intends to cease paying contributions under his Savings Contract, the Option linked to the Savings Contract shall lapse immediately unless the Option has already become exercisable in accordance with the rules of the Plan.
 
7.7.                             Meaning of ceasing to be in Relevant Employment
 
For the purpose of Rules 6.3, 7.2, 7.4, and 10.1.2, an Option Holder shall not be treated as ceasing to be in Relevant Employment until he no longer holds any office or employment with a member of the Group.
 
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7.8.                             Interaction of Rules
 
7.8.1.                      If an Option has become exercisable under Rule 7.2 or 7.3 and, during the period allowed for the exercise of the Option under Rule 7.2 or 7.3, the Option Holder dies, the period allowed for the exercise of the Option shall be the period allowed by Rule 7.1.
 
7.8.2.                      If an Option has become exercisable under Rule 7 and, during the period allowed for the exercise of the Option under Rule 7, the Option becomes exercisable under Rule 8 also (or vice versa), the period allowed for the exercise of the Option shall be the first to determine of the period allowed by Rule 7 and the period allowed by Rule 8.
 
8.                                      TAKEOVER, RECONSTRUCTION, AMALGAMATION OR WINDING-UP OF COMPANY
 
8.1.                             General offer for, or acquisition of, Company
 
Notwithstanding Rule 6.1, if a person other than a New Holding Company obtains Control of the Company as a result of:
 
8.1.1.                      making a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a condition such that if it is satisfied the person making the offer will have Control of the Company; or
 
8.1.2.                      making a general offer to acquire all the shares in the Company of the same class as the Plan Shares
 
(in either case, other than any shares already held by him or a person Acting In Concert with him)
 
all Options may be exercised, subject to Rule 8.2, at any time during the period of six months beginning with the time when the person making the offer or proposed acquisition (as the case may be) has obtained Control of the Company and any condition subject to which the offer or proposed acquisition is made has been satisfied. If not so exercised, the Options shall lapse at the expiry of the six month period.
 
8.2.                             Compulsory acquisition of Company
 
Notwithstanding Rule 6.1, if a person, other than a New Holding Company, becomes entitled to serve a Section 102 Notice to acquire shares in the Company, all Options may be exercised at any time during the period beginning with the date the person serves a Section 102 Notice and ending seven clear days before the date on which the person ceases to be entitled to serve such a notice. If not so exercised, the Options shall cease to be exercisable and shall lapse when the person ceases to be entitled to serve such a notice.
 
8.3.                             Reconstruction or amalgamation of Company
 
Notwithstanding Rule 6.1, if a person, other than a New Holding Company, proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by the court under section 101 of the Companies Act 1981 of Bermuda:
 
8.3.1.                      Option Holders may exercise all Options , on the compromise or arrangement being sanctioned by the court, or within the six month period following this date;
 
8.3.2.                      if the compromise or arrangement becomes effective, any Options not so exercised shall cease to be exercisable and shall lapse at the end of such six month period;
 
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8.3.3.                      an Option which has already become exercisable may be exercised unconditionally before the court sanction of the compromise arrangement. Any Option not so exercised shall cease to be exercisable and shall lapse at the end of such six month period.
 
8.4.                             Winding-up of Company
 
If notice is given of a resolution for the voluntary winding-up of the Company:
 
8.4.1.                      Option Holders may exercise all Options , on the passing of the resolution or within the two month period following this date;
 
8.4.2.                      if the resolution is passed, any Options not so exercised shall lapse immediately;
 
8.4.3.                      an Option which has already become exercisable may be exercised unconditionally during such period. Any Option not so exercised shall cease to be exercisable and shall lapse immediately following the passing of the resolution.
 
8.5.                             Shares subject to Options ceasing to be Plan Shares
 
If the shares subject to an Option cease to satisfy the conditions in paragraphs 18 to 22 of Schedule 3:
 
8.5.1.                      the definition of “Plan Shares” shall be amended by the deletion of the words “which satisfy the conditions in paragraphs 18 to 22 of Schedule 3”;
 
8.5.2.                      the Grantor shall, as soon as reasonably practicable, notify HM Revenue & Customs;
 
8.5.3.                      the Option shall continue to exist and shall continue to be entitled to exemptions from income tax applying to an SAYE option scheme approved under Schedule 3 subject to any determination by HM Revenue & Customs to withdraw approval under paragraph 42 of Schedule 3; and
 
8.5.4.                      the Plan shall continue to exist but, if HM Revenue & Customs withdraw approval of the Plan under Schedule 3, as a non HM Revenue & Customs approved plan.
 
8.6.                             Meaning of “obtains Control of the Company”
 
For the purpose of Rule 8, a person shall be deemed to have obtained Control of the Company if he and others Acting In Concert with him have together obtained Control of it.
 
8.7.                             Notification of Option Holders
 
The Grantor shall, as soon as reasonably practicable, notify each Option Holder of the occurrence of any of the events referred to in this Rule and explain how this affects his position under the Plan.
 
9.                                       EXCHANGE OF OPTIONS
 
9.1.                             Circumstances in which Exchange can occur
 
If the person referred to in Rules 8.1, 8.2 or 8.3, (reading the reference in Rule 8.3 to “proposes to obtain” as “obtains”) including a New Holding Company, an Option Holder may, at any time during the period set out in Rule 9.2, by agreement with the Acquiring Company, release his Option in consideration of the grant to him of a new option which is equivalent to the Option but which relates to shares in:
 
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9.1.1.                      the Acquiring Company; or
 
9.1.2.                      a company which has Control of the Acquiring Company; or
 
9.1.3.                      a company which either is, or has Control of, a company which is a member of a Consortium which owns either the Acquiring Company or a company having Control of the Acquiring Company.
 
9.2.                             Period allowed for exchange of Options
 
The period referred to in Rule 9.1 is:
 
9.2.1.                      where Rule 8.1 applies or would apply if the reference in that Rule to “person” was read as “person including a New Holding Company”, the period referred to in that Rule;
 
9.2.2.                      where Rule 8.2 applies, the period during which the Acquiring Company remains so entitled or bound; and
 
9.2.3.                      where Rule 8.3 applies, the period of six months beginning with the time when the court sanctions the compromise or arrangement.
 
9.3.                             Meaning of “equivalent”
 
The New Option shall not be regarded for the purpose of this Rule 9 as equivalent to the Option unless:
 
9.3.1.                      the New Plan Shares satisfy the conditions in paragraphs 18 to 22 of Schedule 3; and
 
9.3.2.                      the New Option will be exercisable in the same manner as the Option and subject to the provisions of the Plan as it had effect immediately before the release of the Option;
 
9.3.3.                      the total market value, immediately before the release of the Option, of the Plan Shares which were subject to the Option is as nearly as may be equal to the total market value, immediately after the grant of the New Option, of the New Plan Shares subject to the New Option (market value being determined for this purpose in accordance with Part VIII of the Taxation of Chargeable Gains Act 1992); and
 
9.3.4.                      the total amount payable by the Option Holder for the acquisition of the New Plan Shares under the New Option is as nearly as may be equal to the total amount that would have been payable by the Option Holder for the acquisition of the Plan Shares under the Option.
 
9.4.                             Grant Date of New Option
 
The Grant Date of the New Option shall be deemed to be the same as the Grant Date of the Option.
 
9.5.                             Application of Plan to New Option
 
In the application of the Plan to the New Option, where appropriate, references to “Company” and “Plan Shares” shall be read as if they were references to the company to whose shares the New Option relates and the New Plan Shares, respectively, save that in the definition of “Board” the reference to “Company” shall be read as if it were a reference to Tyco Electronics Limited.
 
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10.                                LAPSE OF OPTIONS
 
An Option shall lapse on the earliest of:
 
10.1.1.                subject to Rule 7.1, six months after the Bonus Date;
 
10.1.2.                subject to Rules 7.1, 7.2 and 7.4, the Option Holder ceasing to be in Relevant Employment;
 
10.1.3.                the date on which it is provided that the Option shall lapse under Rules 7.1, 7.2 and 7.4 and 8.1 to 8.4;
 
10.1.4.                the date on which a resolution is passed or an order is made by the court for the compulsory winding-up of the Company;
 
10.1.5.                the date on which the Option Holder becomes bankrupt or enters into a compromise with his creditors generally;
 
10.1.6.                before an Option has become capable of being exercised, the Option Holder giving notice that he intends to stop paying monthly contributions, or being deemed under the terms of the Savings Contract to have given such notice or making an application for the repayment of his aggregate monthly contributions; and
 
10.1.7.                the date on which the Option Holder purports to transfer, charge or otherwise alienate the Option.
 
11.                                ADJUSTMENT OF OPTIONS ON REORGANISATION
 
11.1.                      Power to adjust Options
 
In the event of a Reorganisation, the number of Plan Shares subject to an Option, the description of the Plan Shares, the Exercise Price, or any one or more of these, may be adjusted in such manner as the Board or, where the Trustees are the Grantor, the Trustees and the Board together determine.
 
11.2.                      Exercise Price
 
Subject to Rule 11.3, no adjustment shall be made to the Exercise Price which would result in the Plan Shares subject to an Option being issued directly to the Option Holder at a price per Plan Share lower than the nominal value of a Plan Share and, if an adjustment would so result, the Exercise Price shall be the nominal value of a Plan Share.
 
11.3.                      Capitalisation of reserves
 
Notwithstanding Rule 11.2, an adjustment may be made which would result in the Plan Shares subject to an Option being issued at a price per Plan Share lower than the nominal value of a Plan Share if and to the extent that the Board is authorised to capitalise from the Company’s reserves a sum equal to the amount by which the aggregate nominal value of the Plan Shares subject to the Options which are adjusted exceeds the aggregate adjusted Exercise Price under such Options. If such an adjustment is made, on the subsequent exercise of the Option, the Board shall capitalise such sum and apply the sum in paying up such excess.
 
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11.4.                      HM Revenue & Customs approval
 
An adjustment shall not have effect until the adjustment has been approved by HM Revenue & Customs.
 
11.5.                      Notification of Option Holders
 
The Grantor shall, as soon as reasonably practicable, notify each Option Holder of any adjustment made under this Rule 11 and explain how this affects his position under the Plan. The Grantor may call in for endorsement or cancellation and re-issue any Option Certificate in order to take account of such adjustment.
 
12.                                ISSUE AND AVAILABILITY OF PLAN SHARES
 
12.1.                      Rights attaching to Plan Shares
 
All Plan Shares issued in respect of exercise of an Option shall, as to voting, dividend, transfer and other rights, including those arising on a liquidation of the Company, rank equally in all respects and as one class with the Plan Shares in issue at the date of such issue save as regards any rights attaching to such Plan Shares by reference to a record date prior to the date of such issue.
 
12.2.                      Availability of Plan Shares
 
The Company shall at all times use its reasonable endeavours to keep available sufficient authorised but unissued Plan Shares to satisfy the exercise of all Options which the Board has determined will be satisfied by the issue of Plan Shares (whether directly to the Option Holder or indirectly via the Trustees).
 
13.                                RELATIONSHIP OF PLAN TO CONTRACT OF EMPLOYMENT
 
13.1.                      Contractual Provisions
 
Notwithstanding any other provision of the Plan:
 
13.1.1.                the Plan shall not form part of any contract of employment between any Group Member and an Eligible Employee;
 
13.1.2.                unless expressly so provided in his contract of employment, an Eligible Employee has no right to be granted an Option;
 
13.1.3.                the benefit to an Eligible Employee of participation in the Plan (including, in particular but not by way of limitation, any Options held by him) shall not form any part of his remuneration or count as his remuneration for any purpose and, for the purposes of his contract of employment, shall not be pensionable; and
 
13.1.4.                if an Eligible Employee ceases to be in Relevant Employment, he shall not be entitled to compensation for the loss of any right or benefit or prospective right or benefit under the Plan (including, in particular but not by way of limitation, any Options held by him which lapse by reason of his ceasing to be in Relevant Employment) whether by way of damages for unfair dismissal, wrongful dismissal, breach of contract or otherwise.
 
By applying for an Option an Option Holder is deemed to have agreed to the provisions of this Rule 13.
 
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14.                                ADMINISTRATION OF PLAN
 
14.1.                      Responsibility for administration
 
The Company, and the Grantor where appropriate, shall be responsible for, and shall have the conduct of, the administration of the Plan. The Grantor may from time to time make, amend or rescind regulations for the administration of the Plan provided that such regulations shall be consistent with the Rules and not cause any of the provisions of Schedule 3 which are relevant to the Plan to cease to be satisfied.
 
14.2.                      Grantor’s decision final and binding
 
The decision of the Grantor shall be final and binding in all matters relating to the administration of the Plan, including but not limited to the resolution of any dispute concerning, or any inconsistency or ambiguity in the Rules or any document used in connection with the Plan.
 
14.3.                      Trustees to consult with Board
 
Where the Trustees have granted, or propose to grant, an Option, the Trustees shall consult with, and take account of the wishes of, the Board before making any determination or exercising any power or discretion under the Plan.
 
14.4.                      Provision of information
 
The Trustees and an Option Holder shall provide to the Company as soon as reasonably practicable such information as the Company reasonably requests for the purpose of complying with its obligations under paragraph 45 of Schedule 3.
 
14.5.                      Cost of Plan
 
The cost of introducing and administering the Plan shall be met by the Company. The Company shall be entitled, if it wishes, to charge an appropriate part of such cost to a Subsidiary. The Company shall also be entitled, if it wishes, to charge to a Subsidiary the opportunity cost of issuing Plan Shares to an Option Holder employed by the Subsidiary in relation to his exercise of an Option.
 
14.6.                      Establishment of separate plans for overseas territories
 
The Company may establish separate plans to operate in overseas territories or in respect of overseas employees which are on substantially the same terms as the Plan but which make such modifications to the terms as are necessary or expedient to take account of local tax, exchange control or securities laws in any one or more overseas territories (a “Modified Plan”). Rule 4 shall apply so as to limit the number of Plan Shares which may be placed under Option under a Modified Plan and Plan Shares placed under an Option granted under a Modified Plan shall be included for the purpose of the limit set out in Rule 4.
 
For the avoidance of doubt, such plans shall not be intended to be subject to HM Revenue & Customs approval under Schedule 3 and no modifications made in accordance with this clause shall affect the Plan.
 
19

 
14.7.                     Data protection
 
By applying for an Option, an Option Holder is deemed to consent to the holding and processing of personal data provided by the Option Holder to the Company for all purposes relating to the operation of the Plan.
 
15.                                AMENDMENT OF PLAN
 
15.1.                      Power to amend Plan
 
Subject to Rules 15.2 to 15.3, the Board may from time to time amend the rules of the Plan.
 
15.2.                      HM Revenue & Customs approval of amendments
 
Save for an amendment pursuant to Rule 8.5, an amendment to a Key Feature of the Plan shall not have effect at a time when the Plan is approved by HM Revenue & Customs, until the amendment has been approved by HM Revenue & Customs under Schedule 3.
 
15.3.                      Rights of existing Option Holders
 
An amendment may not adversely affect the rights of an existing Option Holder except where the amendment has been approved by those existing Option Holders who would be adversely affected by the amendment in such manner as would be required by the Company’s articles of association (with appropriate changes) if the Plan Shares subject to those Options which would be so adversely affected had been issued or transferred to them (so that they had become shareholders in the Company) and constituted a separate class of shares.
 
15.4.                      Notification of Option Holders
 
The Board shall, as soon as reasonably practicable, notify each Option Holder of any amendment to the Rules under this Rule 15 and explain how it affects his position under the Plan.
 
16.                                NOTICES
 
16.1.                      Notice by Grantor
 
Save as provided for by law and subject to Rule 16.4, any notice, document or other communication given by, or on behalf of, the Grantor or to any person in connection with the Plan shall be deemed to have been duly given if delivered to him at his place of work, if he is in Relevant Employment if sent by e-mail to such e-mail address as may be specified by him from time to time, or sent through the post in a pre-paid envelope to the postal address last known to the Company to be his address and, if so sent, shall be deemed to have been duly given on the date of posting.
 
16.2.                      Deceased Option Holders
 
Save as provided for by law and subject to Rule 16.4, any notice, document or other communication so sent to an Option Holder shall be deemed to have been duly given notwithstanding that such Option Holder is then deceased (and whether or not the Grantor has notice of his death) except where his personal representatives have established their title to the satisfaction of the Grantor and supplied to the Grantor an e-mail or postal address to which notices, documents and other communications are to be sent.
 
20

 
16.3.                      Notice to Grantor
 
Save as provided for by law and subject to Rule 16.4, any notice, document or other communication given to the Grantor in connection with the Plan shall be delivered or sent by post to the Company Secretary at the Company’s registered office or such other e-mail or postal address as may from time to time be notified to Option Holders but shall not in any event be duly given unless and until it is actually received at the registered office or such e-mail or postal address and shall be deemed to have been duly given on the date of such receipt.
 
16.4.                      Option Certificate and Notice of Option
 
For the avoidance of doubt, the Option Certificate and Notice of Option may not be executed or delivered by e-mail or other such similar electronic communication.
 
17.                                GOVERNING LAW AND JURISDICTION
 
17.1.                      Plan governed by English law
 
The formation, existence, construction, performance, validity and all aspects whatsoever of the Plan, any term of the Plan and any Option granted under it shall be governed by English law.
 
17.2.                      English courts to have jurisdiction
 
The English courts shall have jurisdiction to settle any dispute which may arise out of, or in connection with, the Plan.
 
17.3.                      Jurisdiction agreement for benefit of Company
 
The jurisdiction agreement contained in this Rule 17 is made for the benefit of the Company only, which accordingly retains the right to bring proceedings in any other court of competent jurisdiction.
 
17.4.                      Option Holder deemed to submit to such jurisdiction
 
By executing and returning the Option Certificate to the Grantor, an Option Holder is deemed to have agreed to submit to such jurisdiction.
 
21

EXHIBIT 21.1
 
Tyco Electronics Ltd.
Subsidiaries of the Registrant

Jurisdiction	 	Entity Name	 	State	
Argentina	 	Elo Touch Systems Argentina S.A.	 	 	
 	 	Fayser S.R.L.	 	 	
 	 	Tyco Electronics Argentina S.A.	 	 	
 	 	Tyco Networks (Argentina) S.R.L.	 	 	
 	 	Tyco Submarine Systems de Argentina S.A.	 	 	
 	 	 	 	 	
Australia	 	Banool Investments (VIC) Pty Ltd.	 	 	
 	 	Bonvilla Holdings Pty Ltd	 	 	
 	 	Clarebury Pty Ltd	 	 	
 	 	Critchley Electrical Products Pty Limited	 	 	
 	 	Dulmison Australia Pty Ltd	 	 	
 	 	Dulmison Pty Ltd	 	 	
 	 	Grangehurst Enterprises Pty Ltd.	 	 	
 	 	M/A Com Private Radio Systems Pty Limited	 	 	
 	 	Microwave Associates Australia Pty Limited	 	 	
 	 	Morlynn Ceramics Pty Ltd.	 	 	
 	 	Tyco Electronics Pty Limited	 	 	
 	 	Tyco Lambda (Australian Branch)	 	 	
 	 	 	 	 	
Austria	 	Tyco Electronics Austria GmbH	 	 	
 	 	 	 	 	
Bahamas	 	TyCom Services Inc.	 	 	
 	 	 	 	 	
Barbados	 	AMP Exports Limited	 	 	
 	 	Corcom International Limited	 	 	
 	 	Corcom West Indies Limited	 	 	
 	 	TSSL Foreign Sales Corporation	 	 	
 	 	Tyco Electronics Holdings Ltd.	 	 	
 	 	Tyco International Sales Corp.	 	 	
 	 	TyCom Holdings (Barbados) Ltd.	 	 	
 	 	 	 	 	
Belgium	 	Raychem Industries NV	 	 	
 	 	Tyco Electronics Belgium EC N.V.	 	 	
 	 	Tyco Electronics Raychem NV	 	 	
 	 	TyCom Contracting B.V.B.A.	 	 	
 	 	 	 	 	
Bermuda	 	Cawich Limited	 	 	
 	 	Tyco Alpha Limited	 	 	
 	 	Tyco Asia Networks Ltd.	 	 	
 	 	Tyco Beta Limited	 	 	
 	 	Tyco Cableship Charters Ltd.	 	 	
 	 	Tyco Contracting Ltd.	 	 	
 	 	Tyco Eta Limited	 	 	
 	 	Tyco Global Networks Ltd.	 	 	
 	 	Tyco Holdings (Bermuda) No. 7 Limited	 	 	
 	 	Tyco Lambda	 	 	
 
1

 

Jurisdiction	 	Entity Name	 	State	
 	 	Tyco Telecommunications Ltd.	 	 	
 	 	 	 	 	
Brazil	 	Celis Electrocomponentes Ltda.	 	 	
 	 	Tyco Electronics Brasil Ltda.	 	 	
 	 	Tyco Electronics da Amazonia Ltda.	 	 	
 	 	Tyco Sistemas de Energia Ltda.	 	 	
 	 	Tyco Submarine Systems Brasil Ltda.	 	 	
 	 	 	 	 	
Canada	 	Critchley Inc. - Canada	 	 	
 	 	M/A-COM Private Radio Systems Canada Corp.	 	 	
 	 	Tyco Electronics Canada Ltd.	 	 	
 	 	 	 	 	
Cayman Islands	 	Raychem International (Cayman Islands)	 	 	
 	 	 	 	 	
Chile	 	Tyco Electronics Industrial Y Comercial Chile Limitada	 	 	
 	 	 	 	 	
China	 	AMP (China) Investment Co. Ltd.	 	 	
 	 	AMP Trading (Shanghai) Company Limited	 	 	
 	 	Dongguan Transpower Electric Products Co., Ltd.	 	 	
 	 	Dulmison Zibo Insulator Co., Ltd. (60%)	 	 	
 	 	Raychem (Shanghai) Trading Ltd	 	 	
 	 	Raychem Electronics (Shanghai) Ltd.	 	 	
 	 	Raychem Shanghai Cable Accessories Ltd	 	 	
 	 	Shanghai CII Electronic Co. Ltd (50%)	 	 	
 	 	Tyco Electronics (Dongguan) Ltd	 	 	
 	 	Tyco Electronics (Kunshan) Ltd	 	 	
 	 	Tyco Electronics (Qingdao) Ltd.	 	 	
 	 	Tyco Electronics (Shanghai) Co., Ltd	 	 	
 	 	Tyco Electronics (Shenzhen) Co. Ltd.	 	 	
 	 	Tyco Electronics (Suzhou) Ltd.	 	 	
 	 	Tyco Electronics (Wuxi) Ltd	 	 	
 	 	Tyco Electronics (Zhuhai) Ltd	 	 	
 	 	Tyco Electronics AMP Guangdong Ltd	 	 	
 	 	Tyco Electronics AMP Qingdao Ltd.	 	 	
 	 	Tyco Electronics AMP Shanghai Ltd. (92.31%)	 	 	
 	 	Tyco Electronics EM Shenzhen Co. Ltd	 	 	
 	 	Tyco Electronics Technology (Kunshan) Co., Ltd.	 	 	
 	 	 	 	 	
Colombia	 	Tyco Electronics Colombia Ltda.	 	 	
 	 	 	 	 	
Cyprus	 	Raychem Technologies Limited	 	 	
 	 	TyCom Contracting (Cyprus) Limited	 	 	
 	 	TyCom Networks (Cyprus) Limited	 	 	
 	 	 	 	 	
Czech Republic	 	Tyco Electronics Czech s.r.o.	 	 	
 	 	Tyco Electronics EC Trutnov s.r.o.	 	 	
 
2

 

Jurisdiction	 	Entity Name	 	State	
Denmark	 	Tyco Electronics Denmark A/S	 	 	
 	 	Tyco Electronics Far East Holdings ApS	 	 	
 	 	Tyco Holding I ApS	 	 	
 	 	Tyco Holding II (Denmark) ApS	 	 	
 	 	Tyco Holding X (Denmark) ApS	 	 	
 	 	Tyco Holding XVII (Denmark) ApS	 	 	
 	 	 	 	 	
Dominican Republic	 	Raychem Dominicana S.A.	 	 	
 	 	 	 	 	
Egypt	 	TyCom Networks Egypt Ltd.	 	 	
 	 	 	 	 	
Finland	 	Tyco Electronics Finland Oy	 	 	
 	 	 	 	 	
France	 	TGN Euro Link, S.A.	 	 	
 	 	Tyco Electronics France SAS	 	 	
 	 	Tyco Electronics Holding France S.A.S.	 	 	
 	 	Tyco Electronics SIMEL SAS	 	 	
 	 	Tyco Networks (France) SAS	 	 	
 	 	Tyco Submarine Systems SARL	 	 	
 	 	TyCom Contracting (France) SAS	 	 	
 	 	 	 	 	
Germany	 	Corcom GmbH	 	 	
 	 	Hellstern GmbH	 	 	
 	 	TE Vermögensverwaltungs GmbH & Co KG	 	 	
 	 	VISION 165. Vermogensverwaltungsgesellschaft mbH	 	 	
 	 	Tyco Electronics AMP GmbH	 	 	
 	 	Tyco Electronics Raychem GmbH	 	 	
 	 	Tyco Electronics EC Verwaltungsgesellschaft GmbH	 	 	
 	 	Tyco Electronics Finance GmbH	 	 	
 	 	Tyco Electronics Germany AMP GmbH & Co. KG	 	 	
 	 	Tyco Electronics Germany Holdings GmbH	 	 	
 	 	Tyco Electronics Germany Raychem GmbH & Co. KG	 	 	
 	 	Tyco Electronics Holding GmbH	 	 	
 	 	Tyco Electronics Idento GmbH	 	 	
 	 	Tyco Electronics Raychem GmbH	 	 	
 	 	 	 	 	
Gibraltar	 	Tyco Electronics (Gibraltar) Holding Limited	 	 	
 	 	Tyco Electronics (Gibraltar) Limited	 	 	
 	 	Tyco China (Gibraltar) Limited	 	 	
 	 	Tyco India (Gibraltar) Limited	 	 	
 	 	 	 	 	
Greece	 	Raychem Hellas E.P.E.	 	 	
 	 	Tyco Electronics Hellas MEPE	 	 	
 	 	 	 	 	
Guatemala	 	Tyco Submarine Systems, Sociedad Anonima	 	 	
 
3

 

Jurisdiction	 	Entity Name	 	State	
 	 	 	 	 	
Hong Kong	 	Alnery No. 124 Limited	 	 	
 	 	Alnery No. 125 Limited	 	 	
 	 	Alnery No. 127 Limited	 	 	
 	 	Alnery No. 128 Limited	 	 	
 	 	AMP Products Pacific Limited	 	 	
 	 	Critchley Asia Limited	 	 	
 	 	F.A.I. Technology (Hong Kong) Limited	 	 	
 	 	Madison Cable Asia Limited	 	 	
 	 	Original Electromechanical (HK) Limited	 	 	
 	 	Praegitzer International (HK) Limited (99%)	 	 	
 	 	Raychem (HK) Limited	 	 	
 	 	Raychem China Limited	 	 	
 	 	Raychem China Limited NV	 	 	
 	 	Transpower Technologies (HK) Limited	 	 	
 	 	Tyco Electronics H.K. Limited	 	 	
 	 	Tyco Networks (Hong Kong) Limited	 	 	
 	 	 	 	 	
Hungary	 	Tyco Electronics EC Electromechanical Components	 	 	
 	 	Production Ltd Liability Co.	 	 	
 	 	Tyco Electronics Hungary Termelo Kft	 	 	
 	 	 	 	 	
India	 	Automotive Wiring Systems Private Limited (49%)	 	 	
 	 	Precision Interconnect India Pvt Ltd	 	 	
 	 	Raychem RPG Limited (50%)	 	 	
 	 	TEI Technologies Private Limited (50%)	 	 	
 	 	Tyco Electronics Corporation India Pvt Limited	 	 	
 	 	Tyco Electronics Systems India Pvt Ltd	 	 	
 	 	Tyco Electronics Tools India Pvt. Ltd.	 	 	
 	 	 	 	 	
Indonesia	 	PT Dulmison Indonesia	 	 	
 	 	PT. Tyco Precision Electronics	 	 	
 	 	 	 	 	
Ireland	 	M/A COM Eurotech B.V. (branch of Netherland entity)	 	 	
 	 	Pitsea	 	 	
 	 	Raychem International (Branch of Cayman Islands)	 	 	
 	 	Tyco Electronics Group S.A. (branch of Luxembourg entity)	 	 	
 	 	Tyco Electronics Ireland Limited	 	 	
 	 	Tyco Telecommunications (Ireland)	 	 	
 	 	 	 	 	
Israel	 	Raychem Limited [Israel]	 	 	
 	 	TCM CONTRACTING (ISRAEL) LTD.	 	 	
 	 	TCM NETWORKS (ISRAEL) LTD.	 	 	
 	 	Tyco Electronics Israel Ltd.	 	 	
 	 	 	 	 	
Italy	 	Tyco Electronics AMP Italia Products S.p.A.	 	 	
 
4

 

Jurisdiction	 	Entity Name	 	State	
 	 	Tyco Electronics AMP Italia S.p.A.	 	 	
 	 	Tyco Electronics Raychem S.p.A. [Italy]	 	 	
 	 	Tyco Electronics-Raychem SpA	 	 	
 	 	Tyco Networks (Italy) Srl	 	 	
 	 	 	 	 	
Japan	 	AMP Technology Japan Ltd	 	 	
 	 	Businessland Japan Company Ltd.	 	 	
 	 	Nihon Elcon K.K.	 	 	
 	 	Precision Interconnect International Ltd.	 	 	
 	 	Touch Panel Systems K.K.	 	 	
 	 	Tyco Electronics AMP K.K.	 	 	
 	 	Tyco Electronics EC KK	 	 	
 	 	Tyco Electronics M/A-COM K.K.	 	 	
 	 	Tyco Electronics Raychem K.K.	 	 	
 	 	 	 	 	
Luxembourg	 	Tyco Electronics Holding S.a.r.l.	 	 	
 	 	TCC Holding (Luxembourg) S.a.r.l.	 	 	
 	 	TCN Holding (Luxembourg) S.a.r.l.	 	 	
 	 	Tyco Electronics Group S.A.	 	 	
 	 	TyCom Holdings II SA	 	 	
 	 	 	 	 	
Malaysia	 	AMP Products (Malaysia) Sdn. Bhd.	 	 	
 	 	Japan Original (M) Sdn Bhd	 	 	
 	 	Praegitzer Asia Sdn. Bhd.	 	 	
 	 	Raychem Sdn. Berhad.	 	 	
 	 	Tyco Electronics (Malaysia) Sdn. Bhd.	 	 	
 	 	Tyco Electronics Dulmison (Malaysia) Sdn. Bhd.	 	 	
 	 	Tyco Manufacturing (Malaysia) Sdn. Bhd.	 	 	
 	 	 	 	 	
Marshall Islands	 	C.S. Tyco Decisive Inc.	 	 	
 	 	C.S. Tyco Dependable Inc.	 	 	
 	 	C.S. Tyco Durable Inc.	 	 	
 	 	C.S. Tyco Provider, Inc.	 	 	
 	 	C.S. Tyco Reliance Inc.	 	 	
 	 	C.S. Tyco Resolute Inc.	 	 	
 	 	C.S. Tyco Responder Inc.	 	 	
 	 	Coastal Cable Ship Co. Inc.	 	 	
 	 	 	 	 	
Mauritius	 	Tyco Electronics Asia Investments Limited	 	 	
 	 	 	 	 	
Mexico	 	AMP Amermex, S.A. de C.V.	 	 	
 	 	Cima de Acuna S.A. de C.V.	 	 	
 	 	Corcom, S.A. de C.V.	 	 	
 	 	Kemex Holding Company, S.A. de C.V.	 	 	
 	 	Manufacturas y Conectores TYCO, S. de R.L. de C.V.	 	 	
 	 	Potter & Brumfield de Mexico, S.A. de C.V.	 	 	
 
5

 

Jurisdiction	 	Entity Name	 	State	
 	 	Raychem Juarez, S.A. de C.V.	 	 	
 	 	Tyco Electronics Mexico, S.A.	 	 	
 	 	Tyco Electronics Power Systems de Mexico, S.A. de C.V.	 	 	
 	 	Tyco Electronics Tecnologias S.A. de C.V.	 	 	
 	 	Tyco Submarine Systems, S.A. de C.V.	 	 	
 	 	 	 	 	
Netherlands	 	AMP Taiwan B.V.	 	 	
 	 	AMP Trading B.V.	 	 	
 	 	M/A-COM Eurotec B.V.	 	 	
 	 	Tyco Electronics Nederland B.V.	 	 	
 	 	Tyco Electronics Netherlands Holding B.V.	 	 	
 	 	Tyco Networks (Netherlands) B.V.	 	 	
 	 	 	 	 	
New Zealand	 	Tyco Electronics NZ Limited	 	 	
 	 	 	 	 	
Norway	 	Tyco Electronics Norge AS	 	 	
 	 	Tyco Networks Norway AS	 	 	
 	 	 	 	 	
Panama	 	TYCO SUBMARINE SYSTEMS, INC.	 	 	
 	 	 	 	 	
Peru	 	Tyco Electronics Del Peru S.A.C.	 	 	
 	 	TyCom Networks (Peru) S.A.	 	 	
 	 	 	 	 	
Philippines	 	Tyco Electronics Philippines, Inc.	 	 	
 	 	 	 	 	
Poland	 	M/A-COM Poland Sp. z o.o.	 	 	
 	 	TYCO Electronics Polska Sp.z.o.o.	 	 	
 	 	 	 	 	
Portugal	 	Tyco Electronics Componentes Electromecanicos Lda.	 	 	
 	 	 	 	 	
Puerto Rico	 	TyCom Networks (Puerto Rico) Corp.	 	 	
 	 	M/A-COM, Inc. (US company qualified in PR)	 	 	
 	 	 	 	 	
Rep of Slovenia	 	Tyco Electronics d.o.o. (Slovenia)	 	 	
 	 	 	 	 	
Russia	 	Rayenergo (ZAO Rayenergo) (90%)	 	 	
 	 	Tyco Electronics Rus OOO	 	 	
 	 	TyCom Networks (Russia)	 	 	
 	 	 	 	 	
Saudi Arabia	 	Raychem Saudi Arabia Limited (49%)	 	 	
 	 	 	 	 	
Scotland	 	Madison Cable Limited	 	 	
 	 	 	 	 	
Singapore	 	AMP Singapore Pte. Ltd.	 	 	
 	 	Crompton Instruments (South-East Asia) Pte. Ltd.	 	 	
 	 	Dynavision Electronics Pte Ltd	 	 	
 
6

 

Jurisdiction	 	Entity Name	 	State	
 	 	Raychem Singapore Pte. Limited	 	 	
 	 	Tyco Electronics AMP Manufacturing (S) Pte Ltd	 	 	
 	 	Tyco Electronics Manufacturing Singapore Pte. Ltd.	 	 	
 	 	Tyco Electronics Singapore Pte Ltd	 	 	
 	 	Tyco Networks (Singapore) PTE LTD	 	 	
 	 	 	 	 	
South Africa	 	Tyco Electronics South Africa (Proprietary) Ltd.	 	 	
 	 	Original Electromechanical (Korea) Ltd	 	 	
 	 	Tyco Electronics AMP Korea Limited	 	 	
 	 	Tyco Electronics Raychem Korea Limited	 	 	
 	 	 	 	 	
Spain	 	Diamit, S.L.	 	 	
 	 	Mondragon Telecommunications S.L.	 	 	
 	 	Tyco Electronics AMP Espana, S.A.	 	 	
 	 	Tyco Electronics Raychem SA	 	 	
 	 	Tyco Iberia, S.L.	 	 	
 	 	Tyco Marine, S.A.	 	 	
 	 	Tyco Networks Iberica, S.L.	 	 	
 	 	 	 	 	
Sweden	 	Tyco Electronics Svenska AB	 	 	
 	 	Tyco Networks (Sweden) AB	 	 	
 	 	 	 	 	
Switzerland	 	Tyco Electronics Holding S.a.r.l., Luxembourg (LU), Schaffhausen Branch	 	 	
 	 	TCN Holding (Luxembourg) Sàrl, Schaffhausen Branch	 	 	
 	 	Tyco Electronics (Schweiz) Holding II GmbH	 	 	
 	 	Tyco Electronics (Schweiz) HFI 2 GmbH	 	 	
 	 	Tyco Electronics (Schweiz) HFI AG	 	 	
 	 	Tyco Electronics (Schweiz) HFI 2 GmbH	 	 	
 	 	Tyco Electronics (Schweiz) Holding GmbH	 	 	
 	 	Tyco Electronics (Schweiz) Holding II GmbH	 	 	
 	 	Tyco Electronics Finance Alpha GmbH	 	 	
 	 	Tyco Electronics Logistics AG	 	 	
 	 	Tyco Electronics Services GmbH	 	 	
 	 	Tyco Electronics Swiss Holding GmbH	 	 	
 	 	Tyco International Services GmbH	 	 	
 	 	TyCom Finance AG	 	 	
 	 	 	 	 	
Taiwan	 	AMP Manufacturing Taiwan Co. Ltd	 	 	
 	 	FAI Technology (Taiwan) Co. Ltd	 	 	
 	 	Raychem Pacific Corporation (50%)	 	 	
 	 	Taiwan Superior Electric Co., Ltd.	 	 	
 	 	Taliq Taiwan Limited	 	 	
 	 	Tyco Electronics Taiwan Co., Ltd.	 	 	
 	 	Tyco Holdings (Bermuda) No. 7 Limited, Taiwan Branch	 	 	
 	 	 	 	 	
Thailand	 	Tyco Electronics (Thailand) Ltd	 	 	
 
7

 

Jurisdiction	 	Entity Name	 	State	
 	 	Tyco Electronics Dulmison (Thailand) Co., Ltd.	 	 	
 	 	 	 	 	
Turkey	 	Tyco Elektronik AMP Ticaret Limited Sirketi	 	 	
 	 	TYCOM NETWORK VE TELEKOMUNIKASYON SISTEMLERI
INSAAT TESIS HIZMETLERI VE TICARET LIMITED SIRKETI	 	 	
 	 	 	 	 	
UAE	 	Dorman Smith Switchgear LLC (49%)	 	 	
 	 	Tyco Electronics Middle East FZE	 	 	
 	 	 	 	 	
Ukraine	 	Tyco Electronics Ukraine Limited	 	 	
 	 	 	 	 	
United Kingdom	 	AMP Finance Limited	 	 	
 	 	AMP of Great Britain Limited	 	 	
 	 	B. & H. (Nottingham) Limited	 	 	
 	 	Belclere Limited	 	 	
 	 	Bowthorpe EMP Limited	 	 	
 	 	Bowthorpe Industries Limited	 	 	
 	 	Communication Accessories Limited	 	 	
 	 	Component Engineering Services Ltd	 	 	
 	 	Critchley Finance (UK) Limited	 	 	
 	 	Critchley Group Limited	 	 	
 	 	Critchley Group Trustee Limited	 	 	
 	 	Critchley HSI Systems Limited	 	 	
 	 	Critchley Limited	 	 	
 	 	Critchley Tecpro Limited	 	 	
 	 	CROSTER ELECTRONICS LIMITED	 	 	
 	 	CTT Limited	 	 	
 	 	Distribution and Transmission Equipment Limited	 	 	
 	 	Ditel Limited	 	 	
 	 	Dorman Smith Holdings Limited	 	 	
 	 	Dorman Smith Switchgear Limited	 	 	
 	 	Dulmison (UK) Ltd.	 	 	
 	 	Elo TouchSystems Limited	 	 	
 	 	Flowlyne (UK) Limited	 	 	
 	 	Gresham Land and Estates (ADC) Limited	 	 	
 	 	Image Scan ID Systems Limited	 	 	
 	 	Jessar Engineering Limited	 	 	
 	 	Kurtbrook Limited	 	 	
 	 	M.A.M. Rubber Manufacturing Company Limited	 	 	
 	 	M/A-COM (U.K.) Limited	 	 	
 	 	M/A-COM Greenpar Limited	 	 	
 	 	M/A-COM Limited	 	 	
 	 	Microdot Connectors Europe Limited	 	 	
 	 	Pinacl Communication Systems Limited	 	 	
 	 	Pinacl Limited	 	 	
 	 	Pinacl Whitehall Limited	 	 	
 
8

 

Jurisdiction	 	Entity Name	 	State	
 	 	Quad Europe Limited	 	 	
 	 	Quad Systems Holdings Limited	 	 	
 	 	Quad Systems Limited	 	 	
 	 	Raychem Limited	 	 	
 	 	Sigmaform (UK) Limited	 	 	
 	 	Soundtouch Limited	 	 	
 	 	Stappard & Howes Limited	 	 	
 	 	Stappard Howes Design Limited	 	 	
 	 	Stappard Howes Projects Limited	 	 	
 	 	TDI Batteries (Europe) Limited	 	 	
 	 	TGN EURO Link Limited	 	 	
 	 	TVM Distribution Limited	 	 	
 	 	TVM Group UK Limited	 	 	
 	 	Tyco Electronics Cables Limited	 	 	
 	 	Tyco Electronics Components Limited	 	 	
 	 	Tyco Electronics Holdings Limited	 	 	
 	 	Tyco Electronics Labels Limited	 	 	
 	 	Tyco Electronics Limited	 	 	
 	 	Tyco Electronics UK Holdings Ltd.	 	 	
 	 	Tyco Electronics UK Ltd.	 	 	
 	 	Tyco Energy (UK) Limited	 	 	
 	 	Tyco Networks (UK) Limited	 	 	
 	 	Tyco VI	 	 	
 	 	TyCom Cable Ship Company (UK) Limited	 	 	
 	 	TyCom Contracting (UK) Limited	 	 	
 	 	West Hyde Developments Limited	 	 	
 	 	 	 	 	
United States	 	Adhesive Technologies, Inc.	 	PA	
 	 	Advanced Packaging Systems	 	CA	
 	 	Allegheny Corp.	 	DE	
 	 	American Electrical Terminal Co., Inc.	 	CT	
 	 	AMP International Enterprises Limited	 	DE	
 	 	AMP INVESTMENTS INC.	 	DE	
 	 	AMP Services, Ltd.	 	DE	
 	 	APS Group Holding, Inc.	 	NV	
 	 	BWD Property, LLC	 	NH	
 	 	C.S. Charles L. Brown, L.P.	 	DE	
 	 	C.S. Global Link, L.P.	 	DE	
 	 	C.S. Global Mariner, L.P.	 	DE	
 	 	C.S. Global Sentinel, L.P. (55%)	 	DE	
 	 	C.S. Long Lines, L.P.	 	DE	
 	 	Chemgene Corporation	 	NY	
 	 	Critchley Group, Inc.	 	UT	
 	 	Electro-Trace Corporation	 	NY	
 	 	F.A.I. Technology, Inc.	 	CA	
 	 	FAI Tech Link Inc.	 	NJ	
 
9

 

Jurisdiction	 	Entity Name	 	State	
 	 	FAI Technology (Holding), Inc.	 	DE	
 	 	Fisk Corporation	 	DE	
 	 	Fisk Electric Holdings, Inc.	 	DE	
 	 	Grinnell US Holding Corp.	 	NV	
 	 	Image Scan, Inc.	 	UT	
 	 	Interamics	 	CA	
 	 	Laser Diode Holdings, Inc.	 	NV	
 	 	Laser Diode Incorporated	 	NV	
 	 	M/A-COM Puerto Rico, Inc.	 	DE	
 	 	M/A-COM Tech Holdings, Inc.	 	DE	
 	 	M/A-COM, INC.	 	FL	
 	 	Palomar Precision Tubes, Inc.	 	CA	
 	 	Pinacl Communications, Inc.	 	DE	
 	 	Power Systems Holdings, Inc.	 	NV	
 	 	Precision Interconnect, Inc.	 	NV	
 	 	Printed Circuits, Inc.	 	FL	
 	 	Raychem (Delaware) Ltd.	 	DE	
 	 	Raychem Corporation of Arizona	 	AZ	
 	 	Raychem Foundation	 	CA	
 	 	Raychem Gulf Coast, Inc.	 	TX	
 	 	Raychem International Corporation	 	CA	
 	 	Raychem International Manufacturing LLC	 	CA	
 	 	Raychem Radiation Technologies, Inc.	 	CA	
 	 	Raychem Ventures, Inc.	 	CA	
 	 	Rayshrink Corporation	 	CA	
 	 	Raythene Systems Corporation	 	CA	
 	 	Remtek International, Inc.	 	CA	
 	 	Rochester Corporation, The	 	DE	
 	 	Sigma Circuits, Inc.	 	DE	
 	 	Sigma GP Holding, Inc.	 	NV	
 	 	Sigma Holding Corp.	 	DE	
 	 	Sigma Printed Circuits Holding Corp.	 	DE	
 	 	Techcon International Ltd.	 	DE	
 	 	TEG Pool Corp.	 	NV	
 	 	Terraworx Inc.	 	NV	
 	 	Thermacon, Inc.	 	OH	
 	 	TME Management Corp.	 	DE	
 	 	TPA Realty Holding Corp.	 	NV	
 	 	TPCG Holding	 	DE	
 	 	Transoceanic Cable Ship Company, Inc.	 	NY	
 	 	Transpower Technologies, Inc.	 	NV	
 	 	TSSL Holding Corp.	 	DE	
 	 	Tyco Electronics Corporation	 	PA	
 	 	Tyco Electronics Holding Corp.	 	NV	
 	 	Tyco Electronics Installation Services, Inc.	 	DE	
 	 	Tyco Electronics Latin America Holding LLC	 	NV	
 
10

 

Jurisdiction	 	Entity Name	 	State	
 	 	Tyco Electronics Power Systems, Inc.	 	NV	
 	 	Tyco Flow Control, Inc.	 	TX	
 	 	Tyco Holding Corp.	 	NV	
 	 	Tyco Holdings, Inc.	 	DE	
 	 	Tyco Integrated Cable Systems, Inc.	 	MA	
 	 	Tyco International (PA) Inc.	 	NV	
 	 	Tyco International (US) Inc.	 	NV	
 	 	Tyco Networks (Solutions) Inc.	 	NV	
 	 	Tyco Printed Circuit Group LP	 	DE	
 	 	Tyco Receivables Funding LLC	 	DE	
 	 	Tyco Sailing, Inc.	 	NV	
 	 	Tyco SPC, Inc.	 	DE	
 	 	Tyco Submarine Systems Projects, Inc.	 	DE	
 	 	Tyco Technology Resources, Inc.	 	DE	
 	 	Tyco Telecom OSP Holding Corp.	 	NV	
 	 	Tyco Telecommunications (US) Inc.	 	DE	
 	 	Tyco (US) Holdings, Inc.	 	DE	
 	 	TyCom (US) Holdings, Inc.	 	NV	
 	 	TyCom Acquisition Co. I, Inc.	 	NV	
 	 	TyCom Management Inc.	 	NV	
 	 	TyCom Simplex Holdings Inc.	 	NV	
 	 	Unistrut Corporation	 	DE	
 	 	Whitaker Corporation, The	 	DE	
 	 	Wormald Americas, Inc.	 	DE	
 	 	 	 	 	
Uruguay	 	Raychem Uruguay S.A.	 	 	
 	 	 	 	 	
Venezuela	 	Amp de Venezuela, C.A.	 	 	
 	 	Tyco Electronics de Venezuela, C.A.	 	 	
 	 	Tyco Submarine Systems, C.A.	 	 	
 
11

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 Exhibit 23.1

 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
        We consent to the incorporation by reference in Registration Statements on Forms S-8 (File Nos. 333-144355 and 333-144369) of our report dated December 14, 2007, relating to the consolidated and combined financial statements of Tyco Electronics Ltd. (which report expresses an unqualified opinion on the financial statements and financial statement schedule and includes explanatory paragraphs referring to a) related party transactions with Tyco International Ltd. and allocations of corporate overhead, net class action settlement costs, other expenses, debt and related interest expense from Tyco International which may not be reflective of the actual level of costs or debt which would have been incurred had Tyco Electronics operated as a separate entity apart from Tyco International, b) the adoption of Statement of Financial Accounting Standards No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87, 88, 106, and 132(R) , c) certain guarantee commitments with Tyco International and Covidien Ltd., d) the adoption of Statement of Financial Accounting Standards No. 123R, Share-Based Payment , in 2006, and e) a change to the measurement date of pension and post retirement plans from September 30 to August 31 in 2005).
/s/ Deloitte & Touche LLP
December 14, 2007
Philadelphia, Pennsylvania

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Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

EXHIBIT 24.1
 
POWER OF ATTORNEY
 
KNOW ALL PERSONS BY THESE PRESENTS:
 
That each person whose signature appears below, as a Director of Tyco Electronics Ltd. (the “Company”), a Bermuda company with its general offices at Second Floor, 96 Pitts Bay Road, Pembroke, HM 08, Bermuda, does hereby make, constitute and appoint Thomas J. Lynch, Chief Executive Officer, Terrence R. Curtin, Executive Vice President and Chief Financial Officer, Robert A. Scott, Executive Vice President and General Counsel, or any one of them acting alone, his or her true and lawful attorneys, with full power of substitution and resubstitution, in his or her name, place and stead, in any and all capacities, to execute and sign the Company’s Annual Report on Form 10-K for the fiscal year ended September 28, 2007, and any and all amendments thereto, and documents in connection therewith, to be filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, giving and granting unto said attorneys full power and authority to do and perform such actions as fully as they might have done or could do if personally present and executing any of said documents.
 
Dated and effective as of the 14 th of December 2007.

/s/  THOMAS J. LYNCH	 	/s/  FREDERIC M. POSES	 	
Thomas J. Lynch, Director	 	Frederic M. Poses, Director	 	
 	 	 	 	
/s/  PIERRE R. BRONDEAU	 	/s/  LAWRENCE S. SMITH	 	
Pierre R. Brondeau, Director	 	Lawrence S. Smith, Director	 	
 	 	 	 	
/s/  RAM CHARAN	 	/s/  PAULA A. SNEED	 	
Ram Charan, Director	 	Paula A. Sneed, Director	 	
 	 	 	 	
/s/  JUERGEN W. GROMER	 	/s/  DAVID P. STEINER	 	
Juergen W. Gromer, Director	 	David P. Steiner, Director	 	
 	 	 	 	
/s/  ROBERT M. HERNANDEZ	 	/s/  SANDRA S. WIJNBERG	 	
Robert M. Hernandez, Director	 	Sandra S. Wijnberg, Director	 	
 	 	 	 	
/s/  DANIEL J. PHELAN	 	 	 	
Daniel J. Phelan, Director	 	 	 	

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 Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Thomas J. Lynch, certify that:
1.
I have reviewed this Annual Report on Form 10-K of Tyco Electronics Ltd.;

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;

4.
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)) for the registrant and have:

a)
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;

b)
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

c)
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);

a)
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

b)
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: December 14, 2007

 	 	/s/   THOMAS J. LYNCH       

Thomas J. Lynch
 Chief Executive Officer	

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Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER

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 Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Terrence R. Curtin, certify that:
1.
I have reviewed this Annual Report on Form 10-K of Tyco Electronics Ltd.;

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;

4.
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)) for the registrant and have:

a)
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;

b)
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

c)
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);

a)
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

b)
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: December 14, 2007

 	 	/s/   TERRENCE R. CURTIN       

Terrence R. Curtin
 Executive Vice President and Chief Financial Officer	

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Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER

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 Exhibit 32.1
TYCO ELECTRONICS LTD.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
        The undersigned officers of Tyco Electronics Ltd. (the "Company") hereby certify to their knowledge that the Company's annual report on Form 10-K for the fiscal year ended September 28, 2007 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/   THOMAS J. LYNCH       

Thomas J. Lynch
 Chief Executive Officer
 December 14, 2007	 	 	

/s/   TERRENCE R. CURTIN       

Terrence R. Curtin
 Executive Vice President and Chief Financial Officer
 December 14, 2007	

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Exhibit 32.1
TYCO ELECTRONICS LTD. CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002