On February 12, 2009, the Compensation Committee of the Board of Directors of Ingersoll-Rand Company Limited (the "Company") approved a change to the Company's equity grant approach by introducing a restricted share unit ("RSU") program to augment its existing stock option program and Performance Share Program ("PSP"). The RSUs will vest ratably over 3 years and any accrued dividends will be paid in cash at the time of vesting. As a result of this change, eligible participants may receive (i) stock options, (ii) RSUs or
(iii) a combination of both stock options and RSUs under the Company's Incentive Stock Plan of 2007. Those participants receiving combination grants will receive a split with 50% of the intended grant value in stock options and the balance translated into RSUs using a 1:5 conversion ratio (one RSU for every five stock options), resulting in approximately a 15% decrease in the total grant value of the combination grant. Chairman and Chief Executive Officer Herbert L. Henkel, who only receives equity grants that are performance based, did not receive RSUs. Mr. Henkel's stock option grant was awarded at 85% of target (i.e., a 15% reduction), consistent with the Company's other senior management.

The Compensation Committee believes that this revised approach conserves share usage under the Company's incentive stock plan and better balances risk and reward to equity plan participants. The Compensation Committee plans to review the Company's equity grant policies on a regular basis to ensure the best approach for the Company and its shareholders.

In addition, the Compensation Committee determined PSP awards by placing primary emphasis on financial objectives in light of the current economic environment.

On February 12, 2009, the Compensation Committee approved the 2008 annual incentive compensation awards (payable in February 2009) for the Company's Named Executive Officers (Messrs. Henkel, Shawley, Lamach and Ms. Nachtigal, collectively the "NEOs") under the Company's Annual Incentive Matrix ("AIM") Program and the equity awards under the Company's Incentive Stock Plan of 2007. The 2008 compensation awards were as follows:

AIM Program



                     H. L. Henkel                  $ 1,425,000
                     Chairman of the Board
                     and Chief Executive Officer

                     M.W. Lamach*                  $   390,920
                     President and Chief
                     Operating Officer

                     Steven R. Shawley**           $   290,559
                     Senior Vice President
                     and Chief Financial Officer

                     P. Nachtigal                  $   227,981
                     Senior Vice President
                     and General Counsel

* Mr. Lamach was elected President and Chief Operating Officer in February 2009. Prior to that, Mr. Lamach served as Senior Vice President and President, Trane Commercial (June 2008-February 2009), and Senior Vice President and President, Security Technologies (2004-08).

** Mr. Shawley was elected Senior Vice President and Chief Financial Officer of the Company in June 2008. From 2005 until June 2008, Mr. Shawley was Senior Vice President and President, Climate Control Technologies.

Stock Option Program



     Mr. Henkel      425,000 options at an exercise price of $16.85 per share
     Mr. Lamach      66,125 options at an exercise price of $16.85 per share
     Mr. Shawley     65,625 options at an exercise price of $16.85 per share
     Ms. Nachtigal   48,420 options at an exercise price of $16.85 per share

Restricted Share Unit Program



                           Mr. Henkel      0 RSUs
                           Mr. Lamach      13,225 RSUs
                           Mr. Shawley     13,125 RSUs
                           Ms. Nachtigal   9,684 RSUs

PSP Program



           Mr. Henkel      55,200 Class A common shares of the Company
           Mr. Lamach      6,624 Class A common shares of the Company
           Mr. Shawley     7,728 Class A common shares of the Company
           Ms. Nachtigal   6,624 Class A common shares of the Company