**Johnson & Higgins**

Established 1845

**Insurance Brokers-Average Adjusters**
**Actuaries-Employee Benefit Plan Consultants**

CABLE ADDRESS "KERODEN NEW YORK"
TELEX NO. 420037

95 WALL ST., NEW YORK, N.Y. 10005
TEL 701-7500 AREA CODE 212

August 28, 1985

Mr. Richard Faron
Insurance Department
International Business Machines Corporation
Armonk, New York 10504

Dear Dick:

EXCESS UMBRELLA LIABILITY
POLICY NO.: 8679228134
EFFECTIVE: MAY 21, 1985 TO MAY 21, 1986

In accordance with our Advice of Insurance of June 11, 1985,
enclosed is the captioned Excess Umbrella Liability policy written
by the Federal Insurance Company at a limit of $5,000,000 part of
$40,000,000 excess of $60,000,000 for an annual premium of $22,500
for which our invoices were previously forwarded to you.

Note that the policy contains two exclusions; one is for Absolute
Pollution Legal Liability and a second is an endorsement excluding
any liability arising out of satellites and/or satellite launching.

I trust you find the enclosed in order and ask that you contact me,
should you have any questions.

Very truly yours,

Richard T. Michel
Vice President

RTM2/dg