600 Mountain Avenue Murray Hill, NJ 07974

June 30, 2007

Dear Management Retiree*,

In preparation for the benefits open enrollment for 2008, we wanted to communicate with you as early as we could to summarize the key healthcare changes you can expect. We are providing you this information well in advance of your enrollment period in the fall, so that you have ample time to consider the benefit choices available to you and your family.

What's Changing and Why

While we are part of a new, combined global company, we continue to operate in a very competitive environment and must increase our focus on areas of the business that will maximize opportunities for long-term growth. While we will continue to offer subsidized benefits for our retirees, it is still necessary to ask you to absorb more of the rising costs for U.S. retiree medical coverage.

In that context, following are the key benefit changes that will go into effect January 1, 2008:

Given the changes described in this letter—specifically with regard to the new drug plan design— the amount that the company contributes toward retiree healthcare coverage will be reduced in 2008. However, for most of you who pay monthly contributions, we expect that your contributions will be lower, or only slightly higher, than what you currently pay. We expect to have more information available in the fall, and will provide any updates in your open enrollment material.

In the meantime, we encourage you to explore other benefit options you may have available to you such as coverage through a spouse's employer, commercial coverage or offerings through associations such as AARP. For your reference, general information about Medicare Part D plans is available through the U.S. Department of Health and Human Services Web site at, or by visiting your local Social Security office.

I hope that we've provided you with a general understanding of the options available to you for next year, and leave you adequate time for planning before these changes become effective. Additional information, including the benefit pricing, will be provided as part of the open enrollment material in the fall.


Pat Vogeler

Vice President, Human Resources – North America