This Employee Benefits Plan Agreement involves
Title: AMERICAN STANDARD COMPANIES INC. EXECUTIVE SAVINGS PLAN
Governing Law: Delaware Date: 2/24/2006
Industry: Misc. Capital Goods Sector: Capital Goods
AMERICAN STANDARD COMPANIES INC. EXECUTIVE SAVINGS PLAN
The purposes of the Plan are ( i ) to provide certain participants in the ESOP, Savings Plan and Pension Plan whose employer contributions under such Plans are limited by the operation of Section 401(a)(17) of the Code with an annual benefit, subject to certain limitations, to roughly reflect the equivalent value of lost ESOP, Savings Plan and Pension Plan contributions, and ( ii ) to provide additional credits to those persons selected to receive Transitional Contributions to compensate them, to the extent provided herein, for pension benefits lost or forgone by reason of entering into service with the Company and its Subsidiaries.
(a) “ Account ” means, with respect to any Participant, the book entry account maintained by the Company for the benefit of such Participant, as described in Section 4 below.
(b) “ Accrued Prior Employer Benefit ” means, in respect of an Eligible Employee, the Lump Sum Value as of the date of determination of such person’s accrued vested benefits under those pension benefit plans of his or her prior employer taken into account in determining his or her Projected Prior Employer Benefit.
(c) “ Beneficiary ” means any person or persons, estate or trust designated in accordance with Section 7 below, to receive the amount payable under this Plan upon the death of a Participant.
(d) “ Board ” means the Board of Directors of the Company.
(e) “ Code ” means the Internal Revenue Code of 1986, as amended, or any subsequent income tax law of the United States. References to Code section shall be deemed to include all subsequent amendments of those sections or the corresponding provisions of any subsequent income tax law.
(f) “ Committee ” means the Management Development and Compensation Committee of the Board of Directors of the Company, as such committee may be constituted from time to time.
(g) “ Company ” means American Standard Companies Inc., a Delaware corporation, and any successor thereto.
(h) “ Compensation ” means with respect to any Eligible Employee for any given calendar year the sum of (i) such person’s compensation taken into account under the ESOP for such year, (ii) such person’s compensation taken into account under the SSP for such year and (iii) such person’s Eligible Compensation, if any, under this Plan for such year.
(i) “ Disability ” shall mean the Participant (i) 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 twelve (12) months or (ii) is by reason of medically determinable physical or mental impairment which can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Participants’ employer.
(j) “ Effective Date ” means January 1, 2006.
(k) “ Eligible Compensation ” means for any calendar year the Participant’s compensation as defined under the ESOP in excess of the amount of compensation permitted to be taken into account as of the first day of such calendar year under the SSP.
(l) “ Eligible Employee ” means any Eligible Officer, and with respect to the Transitional Benefit, any person participating in the Company’s Long Term Incentive Plan or any other management or key employee who shall be selected by the Committee to receive an award of a Transitional Benefit hereunder.
(m) “ Eligible Officer ” means any officer of the Company, other than the Vice President & Controller, the Vice President & Treasurer and the Vice President & General Auditor, elected to office on or after the Effective Date.
(n) “ ESOP ” means the American Standard Companies Inc. Employee Stock Ownership Plan, as in effect and as it may be amended from time to time (including any successor plan thereto).
(o) “ ESOP Contributions ” means, with respect to any Participant, an amount equal to the percentage of the employer basic contribution under the ESOP or such lesser percentage as the Plan Administrator may specify prior to the beginning of any calendar year, based on such factors as he or she shall determine) of the Participant’s Eligible Compensation.
(p) “ Investment Officer ” means the Company’s Vice President & Treasurer (or, if no such person is at any time fulfilling such title, the person performing the functions of the Treasurer).
(q) “ Lump Sum Value ” means, with respect to an Executive’s Employee’s Projected Prior Employer Benefit or Accrued Prior Employer Benefit, the actuarial lump sum value of the benefit that would be payable to an Eligible Employee at his or her Projected Retirement Date (or such earlier date as the Committee shall specify) using, where appropriate, the mortality table and interest rate then in use for purposes of determining lump sum payments (other than for small payments under IRS regulations) under the applicable prior employer’s pension plans or such other standard mortality table and interest rate as the Investment Officer may specify from time to time, based on such factors as such officer shall deem reasonable and appropriate.
(r) “ Matching Contributions ” means, in respect of any Participant, an amount equal to the maximum percentage of employer matching contributions under the Savings Plan (or such lesser percentage as the Plan Administrator may specify prior to the beginning of any calendar year, based on such factors as he or she shall determine) of the Participant’s Eligible Compensation.
(s) “ Participant ” means any Eligible Employee or former Eligible Employee with respect to whom an Account is being maintained.
(t) “ Pension Plan ” means the American Standard Pension Plan, as in effect and as it may be amended from time to (including any successor plan thereto)
(u) “ Phantom Fund ” means each mutual fund or other investment vehicle which shall be available to determine the hypothetical investment experience of a Participant’s Account under the Plan.
(v) “ Plan ” means the American Standard Companies Inc. Executive Savings Plan as in effect and as it may be amended from time to time (including any successor plan hereto).
(w) “ Plan Administrator ” means the Senior Vice President-Human Resources of the Company (or, if at any time, no one is serving in such title, the person who is then performing the duties of such position).
(x) “ Projected Company Benefit ” means, in respect of an Eligible Employee, the value expected to be derived, at such individual’s Projected Retirement Age, from employer contributions or credits to a notional account other than by reason of any elective deferral of the Eligible Employee’s compensation, in each case, as is projected to be earned by the Eligible Employee under all plans (whether or not qualified under Section 401(a) of the Code) maintained by the Company and/or any of its Subsidiaries, including, without limitation, the Plan, the SSP, the Pension Plan, the Savings Plan and the ESOP, based on (i) the service such Eligible Employee would complete if he remained in the employ of the Company or a Subsidiary until his or her Projected Retirement Age, (ii) the Compensation such Eligible Employee is expected to earn over such working career, which shall be determined using an assumption of 6% per year annual compensation increase or such other assumption as the Committee shall determine based on such factors as it shall deem appropriate and (iii) assuming that such contributions or credits are increased by earnings from the date made or credited to the Projected Retirement Age (or such earlier date as the Committee shall determine) based on an assumed fixed rate of return of 8%, compounded annually, or such other rate established by the Investment Officer from time to time based on such factors or assumptions that such individual shall determine to be appropriate under the circumstances. Notwithstanding the foregoing, if the Committee believes that it would be warranted by the circumstances, the Committee may reduce the amount taken into account as the Projected Company Benefit, or include in the calculation of such amount only some, but not all, of the benefits projected to be accrued under the plans (or may exclude all benefits provided under one or more plans) maintained by the Company and/or any of its Subsidiaries.
(y) “ Projected Prior Employer Benefit ” mean, with respect to any Eligible Employee, the Lump Sum Value as of the date of determination of the benefit that would have been payable to such person pursuant to the terms of such prior employer’s retirement benefit plans designated by the Committee, assuming that such person continued in service with such prior employer until his or her Projected Retirement Age (or such earlier age as the Committee shall specify) and that his or her eligible compensation under such prior employer plans increased at a rate determined by the Committee using such factors as it deems appropriate. To the extent the Projected Prior Employer Benefit includes a defined contribution plan benefit, projected future contributions to such plan shall be assumed to earn the same rate of return utilized in Section 2(x) (iii).
(z) “ Projected Retirement Age ” means, with respect to any Eligible Employee, age 65 or such lesser age as the Committee shall otherwise specify based on such factors as it shall determine to be appropriate under the circumstances.
(aa) “ Savings Plan ” means the Savings Plan of American Standard Inc. and Participating Subsidiary Companies, as in effect and as it may be amended from time to time (including any successor plan thereto).
(bb) “ Service ” shall have the meaning ascribed to such term in the ESOP.
(cc) “ Shortfall Amount ” means, with respect to any Eligible Employee, the excess of (1) such person’s Projected Prior Employer Benefit over (2) the sum of (i) such person’s Accrued Prior Employer Benefit and (ii) such person’s Projected Company Benefit. Notwithstanding the foregoing, at the time of any award of a Transitional Benefit, the Committee may establish an Eligible Employee’s Shortfall Amount as an amount which is less than the amount derived pursuant to the formula specified in the immediately preceding sentence.
(dd) “ SSP ” means the American Standard Companies Inc. Supplemental Savings Plan, as in effect and as may be amended from time to time (including any successor plan thereto).
(ee) “ Subsidiary ” means a corporation, the majority of the voting stock of which is owned directly or indirectly by the Company, or any other entity designated by the Plan Administrator, in which the Company has a controlling equity interest.
(ff) “ Transitional Benefit ” shall mean a benefit intended to compensate an Eligible Employee for all or a portion of his or her Shortfall Amount through the crediting of Transitional Contributions to such person’s Account for such number of years (or such other period) as the Committee shall determine at the time a Transitional Benefit is approved.
(gg) “ Transitional Contributions ” means a credit to an Eligible Employee’s Account for such percentage of the Eligible Employee’s Compensation (or for such dollar amount) as the Committee shall
determine at the time it selects such Eligible Employee to receive a Transitional Benefit to compensate such Eligible Employee for all or a portion of his or her Shortfall Amount, using the same assumptions regarding rate of return and compensation increases used to compute such individual’s Projected Company Benefit. Unless otherwise specified by the Committee at any time, Transitional Contributions shall only continue during an Eligible Employee’s employment with the Company and/or a Subsidiary and shall be subject to such terms and conditions that the Committee shall impose.
(hh) “ Valuation Date ” means the last day of any calendar year (or such other date or dates as the Plan Administrator may specify