COOPER INDUSTRIES LTD
AMENDED DIRECTORS' RETAINER FEE STOCK PLAN
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<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>h08240exv10w1.txt
<DESCRIPTION>AMENDED DIRECTORS' RETAINER FEE STOCK PLAN
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                                                                    Exhibit 10.1

                             COOPER INDUSTRIES, LTD.
                              AMENDED AND RESTATED
                       DIRECTORS' RETAINER FEE STOCK PLAN
                     (AS AMENDED AND RESTATED APRIL 1, 2003)

1.       Purpose. The purpose of the Amended and Restated Directors' Retainer
         Fee Stock Plan (the "Plan") is to attract, motivate and retain
         experienced and knowledgeable persons to serve as directors of Cooper
         Industries, Ltd. (the "Company") and to promote identification of such
         directors' interests with those of the Company's shareholders.

2.       Definitions. As used in the Plan:

         2.1.     "Affiliate" shall have the meaning set forth in Rule 12b-2
                  under Section 12 of the Exchange Act.

         2.2.     "Annual Service Fee" means the annual cash retainer fee
                  payable to a Nonemployee Director for his or her services on
                  the Board; the annual retainer fee, if any, payable to a
                  Nonemployee Director for serving as a chairperson of a
                  committee of the Board; and any fees payable to a Nonemployee
                  Director for attendance at meetings of the Board or any of its
                  committees.

         2.3.     "Beneficial Owner" shall have the meaning set forth in Rule
                  13d-3 under the Exchange Act.

         2.4.     "Board" means the Board of Directors of the Company.

         2.5.     For all purposes of the Plan, a "Change in Control" shall be
                  deemed to have occurred if the event set forth in any one of
                  the following paragraphs shall have occurred:

                  2.5.1.   any Person is or becomes the Beneficial Owner,
                           directly or indirectly, of securities of the Company
                           (not including in the securities beneficially owned
                           by such Person any securities acquired directly from
                           the Company or its affiliates) representing 25% or
                           more of the combined voting power of the Company's
                           then outstanding securities, excluding any Person who
                           becomes such a Beneficial Owner in connection with a
                           transaction described in clause (i) of paragraph
                           2.5.3 below; or

                  2.5.2.   the following individuals cease for any reason to
                           constitute a majority of the number of directors then
                           serving: individuals who, on the date hereof,
                           constitute the Board and any new director (other than
                           a director whose initial assumption of office is in
                           connection with an actual or threatened election
                           contest, including but not limited to a consent
                           solicitation, relating to the election of directors
                           of the Company) whose appointment or

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                           election by the Board or nomination for election by
                           the Company's shareholders was approved or
                           recommended by a vote of at least two-thirds ( 2/3)
                           of the directors then still in office who either were
                           directors on the date hereof or whose appointment,
                           election or nomination for election was previously so
                           approved or recommended; or

                  2.5.3.   there is consummated a merger or consolidation of the
                           Company or any direct or indirect subsidiary of the
                           Company with any other corporation, other than (i) a
                           merger or consolidation which results in the
                           directors of the Company immediately prior to such
                           merger or consolidation continuing to constitute at
                           least a majority of the Board of Directors of the
                           Company, the surviving entity or any parent thereof,
                           or (ii) a merger or consolidation effected to
                           implement a recapitalization of the Company (or
                           similar transaction) in which no Person is or becomes
                           the Beneficial Owner, directly or indirectly, of
                           securities of the Company (not including in the
                           securities Beneficially Owned by such Person any
                           securities acquired directly from the Company or its
                           Affiliates) representing 25% or more of the combined
                           voting power of the Company's then outstanding
                           securities; or

                  2.5.4.   the shareholders of the Company approve a plan of
                           complete liquidation or dissolution of the Company or
                           there is consummated an agreement for the sale or
                           disposition by the Company of all or substantially
                           all of the Company's assets, other than a sale or
                           disposition by the Company of all or substantially
                           all of the Company's assets to an entity, at least
                           60% of the combined voting power of the voting
                           securities of which are owned by shareholders of the
                           Company in substantially the same proportions as
                           their ownership of the Company immediately prior to
                           such sale.

         2.6.     "Change in Control Price" means the higher of (i) the Fair
                  Market Value on the date of determination of the Change in
                  Control or (ii) the highest price per share actually paid for
                  the Common Stock in connection with the Change in Control of
                  the Company.

         2.7.     "Committee" means the Committee on Nominations and Corporate
                  Governance of the Board.

         2.8.     "Common Stock" means the Class A common shares, par value
                  $0.01 a share, of the Company.

         2.9.     "Deferral Election" shall have the meaning set forth in
                  Section 7 hereof.

         2.10.    "Deferred Shares" shall have the meaning set forth in Section
                  7 hereof.

         2.11.    "Deferred Share Account" shall have the meaning set forth in
                  Section 7 hereof.

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         2.12.    "Dividend Equivalents" shall have the meaning set forth in
                  Section 8 hereof.

         2.13.    "Exchange Act" means the Securities Exchange Act of 1934, as
                  amended from time to time.

         2.14.    "Fair Market Value" of a share of Common Stock, as of any
                  date, means the average of the high and low sales prices of a
                  share of Common Stock as reported on the Stock Exchange
                  composite tape on the applicable date, provided that if no
                  sales of Common Stock were made on the Stock Exchange on that
                  date, the average of the high and low prices as reported on
                  the composite tape for the preceding day on which sales of
                  Common Stock were made.

         2.15.    "Issue Dates" means the first business day of each calendar
                  quarter in a Plan Year.

         2.16.    "Nonemployee Director" means a member of the Board who is not
                  an employee of the Company or any of its subsidiaries.

         2.17.    "Person" shall have the meaning given in Section 3(a)(9) of
                  the Exchange Act, as modified and used in Sections 13(d) and
                  14(d) thereof, except that such term shall not include (i) the
                  Company or any of its subsidiaries, (ii) a trustee or other
                  fiduciary holding securities under an employee benefit plan of
                  the Company or any of its subsidiaries, (iii) an underwriter
                  temporarily holding securities pursuant to an offering of such
                  securities, (iv) a corporation owned, directly or indirectly,
                  by the shareholders of the Company in substantially the same
                  proportions as their ownership of stock of the Company, or (v)
                  any individual, entity or group whose ownership of securities
                  of the Company is reported on Schedule 13G pursuant to Rule
                  13d-1 promulgated under the Exchange Act (but only for so long
                  as such ownership is so reported).

         2.18.    "Plan Year" means the 12-month period commencing May 1 and
                  ending on the following April 30. The first Plan Year shall
                  commence on May 1, 1998.

         2.19.    "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange
                  Act (or any successor rule to the same effect).

         2.20.    "Stock Exchange" means the New York Stock Exchange, Inc.
                  ("NYSE") or, if the Common Stock is no longer included on the
                  NYSE, then such other market price reporting system on which
                  the Common Stock is traded or quoted.

         2.21.    "Voting Stock" means securities entitled to vote in an
                  election of directors of the Company.

3.       Authorized Shares. The total number of shares of the Company's Common
         Stock available for issuance under the Plan is 100,000, including
         Deferred Shares (as defined

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         below), subject to adjustment pursuant to Section 13 hereof. Shares of
         Common Stock available for issuance under the Plan may be authorized
         and unissued shares or shares held by any of the Company's subsidiaries
         as the Company may determine from time to time.

4.       Administration of the Plan. The Plan shall be administered by the
         Committee. The Committee shall, subject to the provisions of the Plan,
         adopt such rules as it may deem appropriate in order to carry out the
         purpose of the Plan. All questions of interpretation, administration,
         and application of the Plan shall be determined by a majority of the
         members of the Committee, except that the Committee may authorize any
         one or more of its members, or any officer or employee of the Company,
         to execute and deliver documents on behalf of the Committee. The
         determination of such majority shall be final and binding in all
         matters relating to the Plan. No member of the Committee shall be
         liable for any act done or omitted to be done by such member or by any
         other member of the Committee in connection with the Plan, except for
         such member's own willful misconduct or as expressly provided by
         statute. All costs and expenses involved in administration of the Plan
         shall be borne by the Company.

5.       Participation. Each Nonemployee Director shall be eligible to
         participate in the Plan.

6.       Election to Receive Common Stock in Lieu of Annual Service Fee. Prior
         to the first day of each Plan Year, each Nonemployee Director may make
         an election to receive all or a portion of his or her Annual Service
         Fee for such Plan Year in Common Stock (a "Stock Election") in lieu of
         cash. Such shares of Common Stock shall be transferred in accordance
         with Section 9 hereof, except to the extent that a Deferral Election
         shall be in effect with respect to such shares or to the extent that
         Section 12 hereof applies. Any Stock Election shall be in writing,
         shall specify the percentage of the Annual Service Fee to be paid in
         Common Stock, and shall be irrevocable for the Plan Year for which the
         Stock Election is made. Notwithstanding the foregoing, any Nonemployee
         Director who is newly elected or appointed to the Board after the first
         day of a Plan Year may make the election under this Section 6 upon the
         date of his or her election or appointment to the Board with respect to
         the percentage of the Annual Service Fee that is payable for the
         remainder of that Plan Year.

7.       Deferral Election. Prior to the first day of each Plan Year, each
         Nonemployee Director may make an election to defer the receipt (a
         "Deferral Election") of all or any percentage of the shares of Common
         Stock otherwise payable to such Nonemployee Director pursuant to
         Section 6 hereof. In such event, the Company shall credit to an account
         (a "Deferred Share Account") maintained on behalf of such Nonemployee
         Director, as of the date on which the shares would otherwise be
         transferred hereunder, the shares of Common Stock ("Deferred Shares")
         deferred. Any Deferral Election shall be in writing, shall specify the
         percentage of shares to be deferred, and shall be irrevocable for the
         Plan Year for which the Deferral Election is made. Notwithstanding the
         foregoing, any Nonemployee Director who is newly elected or appointed
         to the Board after the first day of a Plan Year may make the election
         under this Section 7 upon the date of his or her

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         election or appointment to the Board with respect to the percentage of
         the Stock Election that is to be deferred for the remainder of that
         Plan Year.

         Deferred Shares will be distributed in whole shares of Common Stock and
         cash in lieu of fractional shares. At the time of the Deferral
         Election, the Nonemployee Director shall elect to receive the Deferred
         Shares in either a lump sum or in no more than 10 substantially equal
         annual installments. The lump sum will be paid on either (a) the March
         1 following the calendar year that the Nonemployee Director ceases to
         serve on the Board or (b) a date designated by the Nonemployee Director
         on the Deferral Election. Installment payments shall commence on the
         March 1 following the calendar year that the Nonemployee Director
         ceases to serve on the Board and shall continue on each March 1 until
         all Deferred Shares are distributed. All Deferral Elections are subject
         to Section 12 of this Plan.

         In the event of the Nonemployee Director's death before distribution of
         all of his or her Deferred Shares, the balance of the Deferred Shares
         shall be distributed in a lump sum to the beneficiary or beneficiaries
         designated in writing by the Nonemployee Director, or if no designation
         has been made, to the estate of the Nonemployee Director.

8.       Dividend Equivalents. Deferred Shares shall be credited with an amount
         equal to the dividends that would have been paid on an equal number of
         outstanding shares of Common Stock ("Dividend Equivalents"). Dividend
         Equivalents shall be credited (i) as of the payment date of such
         dividends, and (ii) only with respect to Deferred Shares credited to
         such Nonemployee Director prior to the record date of the dividend.
         When credited, Dividend Equivalents shall be converted into an
         additional number of Deferred Shares as of the payment date of the
         dividend, based on the Fair Market Value on such payment date. Such
         Deferred Shares shall thereafter be treated in the same manner as any
         other Deferred Shares under the Plan.

9.       Transfer of Shares. Shares of Common Stock issuable to a Nonemployee
         Director under Section 6 hereof shall be transferred to such
         Nonemployee Director on the Issue Dates. The total number of shares of
         Common Stock to be transferred shall be determined by the following
         formula:

               % of Stock Election x Quarterly Service Fee Payable
           ----------------------------------------------------------
           Fair Market Value of a Share of Common Stock on Issue Date

         The Company will instruct its registrar to make an entry on the
         Company's Shareholder records evidencing that the shares (including any
         fractional shares) of Common Stock have been issued as of the Issue
         Dates.

         Notwithstanding anything to the contrary herein, if on any Issue Date
         the number of shares of Common Stock otherwise issuable to the
         Nonemployee Directors shall exceed the number of authorized shares of
         Common Stock remaining available under the Plan, the available shares
         shall be allocated among the Nonemployee Directors in proportion to

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         the number of shares they would otherwise be entitled to receive and
         the remainder of the Nonemployee Directors' Annual Service Fee shall be
         payable in cash.

10.      Rights as a Shareholder. Except as otherwise expressly provided herein
         with respect to Dividend Equivalents, a Nonemployee Director shall have
         no rights as a shareholder of the Company with respect to any Common
         Stock to be issued under the Plan until he or she becomes the holder of
         record of such shares.

11.      Vesting. A Nonemployee Director shall be 100% vested in his or her
         Deferred Share Account at all times.

12.      Change in Control. Upon a Change in Control, all Deferred Shares, to
         the extent credited prior to the Change in Control, shall be issued
         immediately, or if the Common Stock is no longer trading on the Stock
         Exchange, shall be paid immediately in cash. For purposes of this
         Section 12, the cash equivalent value of a Deferred Share shall be the
         Change in Control Price.

13.      Effect of Certain Changes in Capitalization. In the event of any
         recapitalization, stock split, reverse stock split, stock dividend,
         reorganization, merger, consolidation, spin-off, combination,
         repurchase, or share exchange, or other similar corporate transaction
         or event affecting the Common Stock, the maximum number or class of
         shares available under the Plan, and the number or class of shares of
         Common Stock to be delivered hereunder shall be adjusted by the
         Committee to reflect any such change in the number or class of issued
         shares of Common Stock.

14.      Term of Plan. The Plan shall become effective on April 30, 1998
         provided that the Plan shall have been approved by the Company's
         shareholders at the 1998 annual meeting of shareholders. Unless
         terminated earlier pursuant to Section 15, the Plan shall have a term
         of 10 years. Notwithstanding the foregoing, any Deferral Elections made
         prior to the termination of the Plan shall continue in accordance with
         the terms hereof.

15.      Amendment; Termination. The Board may at any time and from time to time
         alter, amend, or terminate the Plan in whole or in part; provided,
         however, that no such action shall, without the consent of a
         Nonemployee Director, affect the rights of such Nonemployee Director in
         any Common Stock issued to or deferred by such Nonemployee Director
         under the Plan, and provided, further that no amendment shall be
         effective prior to approval by the Company's shareholders to the extent
         such approval is then required by law, rule or regulation or pursuant
         to Rule 16b-3 in order to preserve the exemption provided by Rule
         16b-3.

16.      Rights of Directors. Nothing contained in the Plan shall confer upon
         any Nonemployee Director any right to continue in the service of the
         Company as a director.

17.      Government and Other Regulations. The obligations of the Company to
         deliver shares under the Plan shall be subject to all applicable laws,
         rules and regulations and such

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         approvals by any government agency as may be required, including,
         without limitation, compliance with the Securities Act of 1933, as
         amended.

18.      Nontransferability. The rights and benefits under the Plan shall not be
         transferable by a Nonemployee Director other than by the laws of
         descent and distribution or pursuant to a qualified domestic relations
         order as defined in the Internal Revenue Code of 1986, as amended, or
         Title I of the Employee Retirement Income Security Act of 1974, as
         amended, or the rules thereunder.

19.      Withholding. To the extent required by applicable federal, state,
         local, or foreign law, a Nonemployee Director shall make arrangements
         satisfactory to the Company for the payment of any withholding tax
         obligations that arise in connection with the Plan. The Company shall
         not be required to issue any Common Stock under the Plan until such
         obligations are satisfied. A Nonemployee Director may satisfy any such
         withholding obligation by (i) having the Company retain the number of
         shares of Common Stock or (ii) tendering the number of shares of Common
         Stock, in either case, whose Fair Market Value equals the amount
         required to be withheld.

20.      Governing Law. To the extent that federal laws do not otherwise
         control, the Plan and all rights hereunder shall be construed in
         accordance with and governed by the laws of the State of Texas.

21.      Headings. The headings of sections herein are included solely for
         convenience of reference and shall not affect the meaning of any of the
         provisions of the Plan.

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