Exhibit 10.2

AMERICAN STANDARD COMPANIES INC.

STOCK INCENTIVE PLAN

(Restated to include all amendments through July 7, 2006)

SECTION 1.

PURPOSE

The purpose of the Plan is to foster and promote the long-term financial success
of the Company and materially increase shareholder value by (a) motivating
superior performance by means of performance-related incentives, (b) encouraging
and providing for the acquisition of an ownership interest in the Company by
Employees, and (c) enabling the Company to attract and retain the services of an
outstanding management team upon whose judgment, interest and special effort the
successful conduct of its operations is largely dependent.

SECTION 2.

DEFINITIONS

2.1 Definitions. Whenever used herein, the following terms shall have the
respective meanings et forth below:

(a) “Act” means the Securities Exchange Act of 1934, as amended.

(b) “Adjustment Event” shall mean any stock dividend, stock split or share
combination of, or extraordinary cash dividend on, the Common Stock or
recapitalization, reorganization, merger, consolidation, split-up, spin-off,
combination, exchange of shares, warrants or rights offering to purchase Common
Stock at a price substantially below Fair Market Value, or other similar event
affecting the Common Stock of the Company.

(c) “Board” means the Board of Directors of the Company.

(d) “Cause” means a Participant’s (i) willful and continued failure
substantially to perform his duties with the Company or any Subsidiary (other
than any

--------------------------------------------------------------------------------

such failure resulting from incapacity due to reasonably documented physical or
mental illness), after a demand for substantial performance is delivered to such
Participant by the Chairman of the Board or any executive officer which
specifically identifies the manner in which it is believed that such Participant
has not substantially performed his duties, or (ii) the willful engaging by such
Participant in illegal misconduct materially and demonstrably injurious to the
Company or any Subsidiary or to the trustworthiness or effectiveness of such
Participant in the performance of his duties. For purposes hereof, no act, or
failure to act, on such Participant’s part shall be considered “willful” unless
done, or omitted to be done, by him not in good faith and without reasonable
belief that his action or omission was in the best interest of the Company or a
Subsidiary. Any act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board or based upon the advice of counsel for the
Company shall be conclusively presumed to be done, or omitted to be done, by
such Participant in good faith and in the best interest of the Company or such
Subsidiary.

(e) “Change of Control” shall mean the occurrence of any of the following
events:

(i) any person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing 15% or more of the combined voting power
of the Company’s then-outstanding securities (a “15% Beneficial Owner”);
provided, however, that (a) the term “15% Beneficial Owner” shall not include
any Beneficial Owner who has crossed such 15% threshold solely as a result of an
acquisition of securities directly from the Company, or solely as a result of an
acquisition by the Company of Company securities, until such time thereafter as
such person acquires additional voting securities other than directly from the
Company and, after giving effect to such acquisition, such person would
constitute a 15% Beneficial Owner; and (b) with respect to any person eligible
to file a Schedule 13G pursuant to Rule 13d-1(b)(1) under the Act with respect
to Company securities (an “Institutional Investor”), there shall be excluded
from the number of securities deemed to be beneficially owned by such person a
number of securities representing not more than 10% of the combined voting power
of the Company’s then-outstanding securities;

(ii) during any period of two consecutive years beginning after

 

- 2 -

--------------------------------------------------------------------------------

December 1, 1996, individuals who at the beginning of such period constitute the
Board together with those individuals who first become directors during such
period (other than by reason of an agreement with the Company or the Board in
settlement of a proxy contest for the election of directors) and whose election
or nomination for election to the Board was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for election was
previously so approved (the “Continuing Directors”), cease for any reason to
constitute a majority of the Board;

(iii) the shareholders of the Company approve a merger, consolidation,
recapitalization or reorganization of the Company, or a reverse stock split of
any class of voting securities of the Company, or the consummation of any such
transaction if shareholder approval is not obtained, other than such transaction
which would result in at least 75% of the total voting power represented by the
voting securities of the Company or the surviving entity outstanding immediately
after such transaction being beneficially owned by persons who together owned at
least 75% of the combined voting power of the voting securities of the Company
outstanding immediately prior to such transaction, with the relative voting
power of each such continuing holder compared to the voting power of each other
continuing holder not substantially altered as a result of the transaction;
provided that, for purposes of this paragraph (iii), (a) such continuity of
ownership (and preservation of relative voting power) shall be deemed to be
satisfied if the failure to meet such 75% threshold (or to preserve such
relative voting power) is due solely to the acquisition of voting securities by
an employee benefit plan of the Company or of such surviving entity or of any
subsidiary of the Company or such surviving entity and (b) voting securities
beneficially owned by such persons who receive them other than as holders of
voting securities of the Company outstanding immediately prior to such
transaction shall not be taken into account for purposes of determining whether
such 75% threshold (or such relative voting power) is satisfied;

(iv) the shareholders of the Company approve a plan of complete

 

- 3 -

--------------------------------------------------------------------------------

liquidation or dissolution of the Company or an agreement for the sale or
disposition of all or substantially all the assets of the Company unless
following the completion of such liquidation or dissolution, or such sale or
disposition, the 75% threshold (and relative voting power) requirements set
forth in sub-paragraph (iii) above are satisfied; or

(v) any other event which the Committee determines shall constitute a Change of
Control for purposes of this Plan;

provided, however, that a Change of Control shall not be deemed to have occurred
if one of the following exceptions applies:

 

  (1) Unless a majority of the Continuing Directors and of the Committee
determine that the exception set forth in this paragraph (1) shall not apply,
none of the foregoing conditions would have been satisfied but for one or more
of the following persons acquiring or otherwise becoming the Beneficial Owner of
securities of the Company: (A) any person who has entered into a binding
agreement with the Company, which agreement has been approved by two-thirds of
the Continuing Directors, limiting the acquisition of additional voting
securities by such person, the solicitation of proxies by such person or
proposals by such person concerning a business combination with the Company (a
“Standstill Agreement”); (B) any employee benefit plan, or trustee or other
fiduciary thereof, maintained by the Company or any Subsidiary; (C) any
Subsidiary; or (D) the Company.

 

  (2)

Unless a majority of the Continuing Directors and of the Committee determine
that the exception set forth in this paragraph (2) shall not apply, none of the
foregoing conditions would have been satisfied but for the acquisition by or of
the Company of or by another entity (whether by the merger or consolidation, the
acquisition of stock or assets, or otherwise) in exchange, in whole or in part,
for securities of the Company, provided that, immediately following such
acquisition, the Continuing Directors constitute a majority of the Board, or a
majority of the board of directors of any other surviving entity, and, in either
case, no agreement,

 

- 4 -

--------------------------------------------------------------------------------

 

arrangement or understanding exists at that time which would cause such
Continuing Directors to cease thereafter to constitute a majority of the Board
or of such other board of directors.

Notwithstanding the foregoing, unless otherwise determined by a majority of the
Continuing Directors, no Change of Control shall be deemed to have occurred with
respect to a particular Participant if the Change of Control results from
actions or events in which such Participant is involved in a capacity other than
solely as an officer, employee or director of the Company.

For purposes of the foregoing definition of Change of Control, the term
“Beneficial Owner,” with respect to any securities, shall mean any person who,
directly or indirectly, has or shares the right to vote or dispose of such
securities or otherwise has “beneficial ownership” of such securities (within
the meaning of Rule 13d-3 and Rule 13d-5 (as such Rules are in effect on
December 1, 1996) under the Act), including pursuant to any agreement,
arrangement or understanding (whether or not in writing); provided, however,
that (i) a person shall not be deemed the Beneficial Owner of any security as a
result of any agreement, arrangement or understanding to vote such security
(A) arising solely from a revocable proxy or consent solicited pursuant to, and
in accordance with, the applicable provisions of the Act and the rules and
regulations thereunder or (B) made in connection with, or otherwise to
participate in, a proxy or consent solicitation made, or to be made, pursuant
to, and in accordance with, the applicable provisions of the Act and the rules
and regulations thereunder, in either case described in clause (A) or clause
(B) above whether or not such agreement, arrangement or understanding is also
then reportable by such person on Schedule 13D under the Act (or any comparable
or successor report), and (ii) a person engaged in business as an underwriter of
securities shall not be deemed to be the Beneficial Owner of any securities
acquired through such person’s participation in good faith in a firm commitment
underwriting until the expiration of forty days after the date of such
acquisition.

(f) “Change of Control Settlement Value” shall mean, with respect to a share of
Common Stock, the excess of the Change of Control Stock Value over the option
price of the Option covering such share of Common Stock, provided that, (i) with
respect to any Option which is an Incentive Stock Option immediately prior to
the election to

 

- 5 -

--------------------------------------------------------------------------------

receive the Change of Control Settlement Value, the Change of Control Settlement
Value shall not exceed the maximum amount permitted for such Option to continue
to qualify as an Incentive Stock Option and (ii) in respect of that portion, if
any, of any Option that had not become exercisable on or before December 31,
2004, the Change of Control Settlement Value shall not exceed the maximum amount
permitted for such Option to remain exempt from Section 409A.

(g) “Change of Control Stock Value” shall mean the value of a share of Common
Stock determined as follows:

(i) if the Change of Control results from an event described in clause (iii) of
the Change of Control definition, the highest per share price paid for shares of
Common Stock of the Company in the transaction resulting in the Change of
Control;

(ii) if the Change of Control results from an event described in clauses (i),
(ii) or (v) of the Change of Control definition and no event described in
clauses (iii) or (iv) of the Change of Control definition has occurred in
connection with such Change of Control, the highest sale price of a share of
Common Stock of the Company on any trading day during the 60 consecutive trading
days immediately preceding and following the date of such Change of Control as
reported on the New York Stock Exchange Composite Tape, or other national
securities exchange on which the Common Stock is traded, and published in The
Wall Street Journal; or

(iii) if the Change of Control results from an event described in clause (iv) of
the Change of Control definition, the price per share at which shares of Common
Stock are redeemed or exchanged by their holders in the transaction described in
such clause (iv) or, if there has been no such redemption or exchange, the
higher of the amounts determined in accordance with clause (i) or clause (ii) of
this Change of Control Stock Value definition.

(h) “Code” means the Internal Revenue Code of 1986, as amended.

(i) “Committee” means the Management Development and Nominating Committee of the
Board (or such other committee of the Board that the Board shall designate),
which shall consist of two or more members, each of whom shall be a non-

 

- 6 -

--------------------------------------------------------------------------------

employee director within the meaning of Rule 16b-3, as promulgated under the Act
and serving at the pleasure of the Board. Notwithstanding the foregoing, with
respect to Incentive Awards granted to non-employee directors, the Committee
shall mean the entire Board.

(j) “Common Stock” means the common stock of the Company, par value $0.01 per
share.

(k) “Company” means American Standard Companies Inc., a Delaware corporation,
and any successor thereto.

(l) “Disability” means a Participant’s inability, due to reasonably documented
physical or mental illness, for more than six months to perform his duties with
the Company or a Subsidiary on a full time basis if, within 30 days after
written notice of termination has been given to such Participant, he shall not
have returned to the full time performance of his duties.

(m) “Dividend Equivalents” means an amount equal to the cash dividends paid by
the Company upon one share of Common Stock for each Restricted Unit awarded to a
Participant in accordance with Section 7 of the Plan.

(n) “Employee” means any officer or other key employee of the Company or any of
its Subsidiaries, including any employee of a minority-owned joint venture.

(o) “Fair Market Value” means, on any date, the average of the highest and
lowest sales price reported for such day on a national exchange or the average
of the highest and lowest bid and asked prices on such date as reported on a
nationally recognized system of price quotation. In the event that there are no
Common Stock transactions reported on such exchange or system on such date, Fair
Market Value shall mean the closing price on the immediately preceding date on
which Common Stock transactions were so reported.

(p) “Incentive Award” means the award of an Option, a Stock Appreciation Right,
a Restricted Unit, or Restricted Stock under the Plan and shall also include an
award of Common Stock or Restricted Units made in conjunction with other
incentive programs established by the Company.

(q) “Option” means the right to purchase Common Stock at a stated price for

 

- 7 -

--------------------------------------------------------------------------------

a specified period of time. For purposes of the Plan, an Option may be either
(i) an “Incentive Stock Option” with the meaning of Section 422 of the Code or
(ii) an Option which is not an Incentive Stock Option (a “Non-Qualified Stock
Option”).

(r) “Participant” means any Employee or any non-employee director of the Company
designated by the Committee to receive an Incentive Award under the Plan.

(s) “Plan” means the American Standard Companies Inc. Stock Incentive Plan, as
set forth herein and as the same may be amended from time to time.

(t) “Public Offering” means the Company’s offering of Common Stock to the
general public through a registration statement filed with the Securities and
Exchange Commission that covers (together with prior effective registrations)
not less than 15% of the shares of Common Stock outstanding at the closing of
such offering on a fully diluted basis.

(u) “Restricted Period” means the period during which Restricted Units or shares
of Restricted Stock are subject to forfeiture or restrictions on transfer (if
applicable) pursuant to Section 7 of the Plan.

(v) “Restricted Stock” means Common Stock awarded to a Participant pursuant to
the Plan which is subject to forfeiture and restrictions on transferability in
accordance with Section 7 of the Plan.

(w) “Restricted Unit” means a Participant’s right to receive pursuant to the
Plan one share of Common Stock at the end of a specified period of time, which
right is subject to forfeiture in accordance with Section 7 of the Plan.

(x) “Retirement” means

(i) with respect to Incentive Awards granted before December 7, 2000,
termination of a Participant’s employment on or after the date the Participant
attains age 55 with 10 years of service;

(ii) with respect to Incentive Awards granted on or after December 7, 2000,
termination of a Participant’s employment on or after the date the Participant
attains age 55 with 5 years of service.

(y) “Stock Appreciation Right” means the right to receive a payment from the

 

- 8 -

--------------------------------------------------------------------------------

Company, in cash or Common Stock, in an amount determined under Section 6.12 of
the Plan.

(z) “Subsidiary” means any corporation or partnership in which the Company owns,
directly or indirectly, 50% or more of the total combined voting power of all
classes of stock of such corporation or of the capital interest or profits
interest of such partnership.

2.2. Gender and Number. Except when otherwise indicated by the context, words in
the masculine gender used in the Plan shall include the feminine gender, the
singular shall include the plural, and the plural shall include the singular.

SECTION 3.

ELIGIBILITY AND PARTICIPATION

Participants in the Plan shall be those Employees and non-employee directors
selected by the Committee to participate in the Plan.

SECTION 4.

ADMINISTRATION

4.1. Power to Grant and Establish Terms of Awards. The Committee shall have the
authority, subject to the terms of the Plan, to determine the Participants to
whom Incentive Awards shall be granted and the terms and conditions of any and
all Incentive Awards, including but not limited to the number of shares of
Common Stock to be covered by each Incentive Award, the time or times at which
Incentive Awards shall be granted, and the terms and provisions of the
instruments by which Options shall be evidenced; to designate Options as
Incentive Stock Options or Non-Qualified Stock Options; and to determine the
period of time during which restrictions on Restricted Stock or Restricted Units
shall remain in effect. The proper officers of the Company may suggest to the
Committee the Participants who should receive Incentive Awards. The terms and
conditions of each Incentive Award shall be determined by the Committee at the
time of grant, and such terms and conditions shall not be subsequently changed
in a manner which would be adverse to the Participant without the

 

- 9 -

--------------------------------------------------------------------------------

consent of the Participant to whom such Incentive Award has been granted. The
Committee may establish different terms and conditions for different
Participants receiving Incentive Awards and for the same Participant for each
Incentive Award such Participant may receive, whether or not granted at
different times. The grant of any Incentive Award to any Participant shall
neither entitle such Participant to, nor disqualify him from, the grant of any
other Incentive Awards. Notwithstanding anything else contained in the Plan to
the contrary, the Committee may delegate, subject to such terms and conditions
as it shall determine, to any officer of the Company or to a committee of
officers of the Company the authority to grant Incentive Awards (and to make any
and all determinations related thereto) to Participants who are not subject to
the reporting requirements of Section 16(a) of the Act.

4.2. Substitute Options. The Committee shall have the right, subject to the
consent of Participants to whom Options have been granted, to grant in
substitution for outstanding Options, replacement Options which may contain
terms more favorable to the Participant than the Options they replace,
including, without limitation, a lower exercise price (subject to Section 6.2),
and to cancel replaced Options.

4.3. Administration. The Committee shall be responsible for the administration
of the Plan. Any Incentive Award granted by the Committee may be subject to such
conditions, not inconsistent with the terms of the Plan, as the Committee shall
determine. The Committee, by majority action thereof, is authorized to
prescribe, amend and rescind rules and regulations relating to the Plan, to
provide for conditions deemed necessary or advisable to protect the interests of
the Company to interpret the Plan and to make all other determinations necessary
or advisable for the administration and interpretation of the Plan to carry out
its provisions and purposes. Determinations, interpretations or other actions
made or taken by the Committee pursuant to the provisions of the Plan shall be
final, binding and conclusive for all purposes and upon all persons. The
Committee may consult with legal counsel, who may be counsel to the Company, and
shall not incur any liability for any action taken in good faith in reliance
upon the advice of counsel.

SECTION 5.

STOCK SUBJECT TO PLAN

5.1. Number. Subject to the provisions of Section 5.3, the number of shares

 

- 10 -

--------------------------------------------------------------------------------

of Common Stock subject to Incentive Awards under the Plan may not exceed
14,504,475, provided that, no more than 7,604,475 of such shares may be granted
as Incentive Stock Options under the Plan. The shares to be delivered under the
Plan may consist, in whole or in part, of Common Stock held in treasury or
authorized but unissued Common Stock, not reserved for any other purpose.

5.2. Canceled, Terminated, or Forfeited Awards. Any shares of Common Stock
subject to an Incentive Award which for any reason expires, or is canceled,
terminated or otherwise settled without the issuance of any Common Stock shall
again be available under the Plan.

5.3. Adjustment in Capitalization. The aggregate number of shares of Common
Stock available for Incentive Awards under Section 5.1 or subject to outstanding
Incentive Awards and the respective prices and/or vesting criteria applicable to
outstanding Incentive Awards shall be proportionately adjusted to reflect, as
deemed equitable and appropriate by the Committee, an Adjustment Event. To the
extent deemed equitable and appropriate by the Committee, subject to any
required action by stockholders, in any merger, consolidation, reorganization,
liquidation, dissolution, or other similar transaction, any Incentive Award
granted under the Plan shall pertain to the securities and other property to
which a holder of the number of shares of Common Stock covered by the Incentive
Award would have been entitled to receive in connection with such event.

Any shares of stock (whether Common Stock, shares of stock into which shares of
Common Stock are converted or for which shares of Common Stock are exchanged or
shares of stock distributed with respect to Common Stock) or cash or other
property received with respect to any award of Restricted Stock or Restricted
Units granted under the Plan as a result of any Adjustment Event, any
distribution of property or any merger, consolidation, reorganization,
liquidation, dissolution or other similar transaction shall, except as provided
in Section 7.4 or as otherwise provided by the Committee at or after the date an
award of Restricted Stock or Restricted Units is made by the Committee, be
subject to the same terms and conditions, including restrictions on transfer, as
are applicable to such shares of Restricted Stock or Restricted Units and any
stock certificate(s) representing or evidencing any shares of stock so received
shall be legended in substantially the same manner as provided in Section 7.5
hereof.

 

- 11 -

--------------------------------------------------------------------------------

SECTION 6.

STOCK OPTIONS

6.1. Grant of Options. Options may be granted to Participants at such time or
times as shall be determined by the Committee. Options granted to non-employee
directors shall be in such amounts and intervals as determined by the Board from
time to time. Options granted under the Plan may be of two types: (i) Incentive
Stock Options and (ii) Non-Qualified Stock Options, except that no Incentive
Stock Option may be granted to a non-employee director or to any Employee of a
Subsidiary which is not a corporation. The date of grant of an Option under the
Plan will be the date on which the Option is awarded by the Committee or, if so
determined by the Committee, the date on which occurs any event the occurrence
of which is an express condition precedent to the grant of the Option. The
Committee shall determine the number of Options, if any, to be granted to the
Participant, provided that, in no event shall the number of shares of Common
Stock subject to any Options or related Stock Appreciation Rights granted to any
Participant during any 12 month period exceed 1,000,000 shares as such number
may be adjusted pursuant to Section 5.3. Each Option shall be evidenced by an
Option agreement that shall specify the type of Option granted, the exercise
price, the duration of the Option, the number of shares of Common Stock to which
the Option pertains, and such other terms and conditions not inconsistent with
the Plan as the Committee shall determine.

6.2. Option Price. Non-Qualified Stock Options and Incentive Stock Options
granted pursuant to the Plan shall have an exercise price which is not less than
the Fair Market Value on the date the Option is granted.

6.3. Exercise of Options. Options awarded to a Participant under the Plan shall
be exercisable at such times and shall be subject to such restrictions and
conditions including the performance of a minimum period of service or the
satisfaction of performance goals, as the Committee may impose either at or
after the time of grant of such Options, subject to the Committee’s right to
accelerate the exercisability of such Option in its discretion. Notwithstanding
the foregoing, unless otherwise determined by the Committee, Options shall
become exercisable in three equal installments on each of the first three
anniversaries of the date of grant. Except as may be provided in any provision
approved by the Committee pursuant to this Section 6.3, after becoming
exercisable each installment shall remain exercisable until expiration,
termination or cancellation of the Option. An Option may be

 

- 12 -

--------------------------------------------------------------------------------

exercised from time to time, in whole or in part, up to the total number of
shares of Common Stock with respect to which it is then exercisable.
Notwithstanding the foregoing, no Option shall be exercisable for more than 10
years after the date on which it is granted.

6.4. Payment. The Committee shall establish procedures governing the exercise of
Options, which shall require that written notice of exercise be given and that
the Option price be paid in full at the time of exercise (i) in cash or cash
equivalents, (ii) in the discretion of the Committee, in shares of Common Stock
which have been owned by the Participant for at least six months’ (or such
greater or lesser period as the Committee shall determine) having a Fair Market
Value on the date of exercise equal to such Option price or in a combination of
cash and Common Stock or (iii) in accordance with such procedures or in such
other form as the Committee shall from time to time determine. As soon as
practicable after receipt of a written exercise notice and payment of the
exercise price in accordance with this Section 6.4, the Company shall deliver to
the Participant a certificate or certificates representing the acquired shares
of Common Stock.

6.5. Incentive Stock Options. Notwithstanding anything in the Plan to the
contrary, no term of the Plan relating to Incentive Stock Options shall be
interpreted, amended or altered, nor shall any discretion or authority granted
under the Plan be so exercised, so as to disqualify the Plan under Section 422
of the Code, or, without the consent of any Participant affected thereby, to
cause any Incentive Stock Option previously granted to fail to qualify for the
Federal income tax treatment afforded under Section 421 of the Code.

6.6. Settlement. At the time a Participant exercises an Option in lieu of
accepting payment of the exercise price of the Option and delivering the number
of shares of Common Stock for which the Option is being exercised, the Committee
may direct that the Company either (i) pay the Participant a cash amount, or
(ii) issue a lesser number of shares of Common Stock having a Fair Market Value
on the date of exercise, equal to the amount, if any, by which the aggregate
Fair Market Value of the shares of Common Stock as to which the Option is being
exercised exceeds the aggregate exercise price for such shares, based on such
terms and conditions as the Committee shall establish.

6.7. Termination of Employment Due to Retirement. Unless otherwise determined by
the Committee at the time of grant, in the event a Participant’s employment with
the Company or a Subsidiary terminates by reason of Retirement, any Options
granted to such

 

- 13 -

--------------------------------------------------------------------------------

Participant which are exercisable at the date of such Participant’s termination
of employment may be exercised at any time prior to three (3) years following
the Participant’s termination of employment or the expiration of the term of the
Options, whichever period is shorter. Notwithstanding the foregoing, for all
Options granted on or after December 7, 2000, unless otherwise determined by the
Committee at the time of grant, in the event a Participant’s employment with the
Company or a Subsidiary terminates by reason of Retirement, any such Options
granted to such Participant which are exercisable at the date of such
Participant’s termination of employment may be exercised at any time during the
period ending on the tenth anniversary of the grant date of such Options.

6.8. Termination of Employment Due to Death or Disability. Unless otherwise
determined by the Committee at the time of grant, in the event a Participant’s
employment with the Company or a Subsidiary terminates by reason of death or
Disability, any Options granted to such Participant which are exercisable at the
date of such Participant’s termination of employment may be exercised by the
Participant or the Participant’s designated beneficiary, and if none is named,
in accordance with Section 10.2, at any time prior to one (1) year following the
Participant’s termination of employment or the expiration date of the term of
the Options, whichever period is shorter. Notwithstanding the foregoing, for all
Options granted on or after December 7, 2000, unless otherwise determined by the
Committee at the time of grant, in the event a Participant’s employment with the
Company or a Subsidiary terminates by reason of death or Disability, any such
Options granted to such Participant which are exercisable at the date of such
Participant’s termination of employment may be exercised by the Participant or
the Participant’s deisgnated beneficiary, and if none is named, in accordance
with Section 10.2, at any time during the period ending on the tenth anniversary
of the grant date of such Options.

6.9. Termination of Employment for Cause. Unless otherwise determined by the
Committee at the time of grant, in the event a Participant’s employment with the
Company or a Subsidiary is terminated for Cause, all Options granted to such
Participant which are then outstanding (whether or not exercisable prior to the
date of such termination) shall be forfeited.

6.10. Termination of Employment for Any Other Reason. Unless otherwise
determined by the Committee at or after the time of grant, in the event a
Participant’s employment with the Company or a Subsidiary terminates for any
reason other than one described in Section 6.7, 6.8 or 6.9, any Options granted
to such Participant which are exercisable at the date of such Participant’s
termination of employment shall be exercisable at

 

- 14 -

--------------------------------------------------------------------------------

any time prior to 90 days following such Participant’s termination of employment
or the expiration of the term of such Options, whichever period is shorter.

6.11. Committee Discretion. Notwithstanding anything else contained in this
Section 6 to the contrary, the Committee may permit all or any portion of any
Options to be exercised following a Participant’s termination of employment for
any reason on such terms and subject to such conditions as the Committee shall
determine for a period up to and including, but not beyond, the expiration of
the term of such Options.

6.12. Stock Appreciation Rights. The Committee may, in its discretion, include
in any Option, either at the time the Option is granted or thereafter at any
time prior to the exercise, termination or expiration of the Option, a right of
the Participant to elect, in lieu of purchasing any shares of Common Stock in
respect of which such Option is exercisable at any time, to relinquish his
Option with respect to any and all of such shares of Common Stock and to receive
from the Company a payment, in cash or Common Stock, equal to the amount by
which (i) the product of (x) the Fair Market Value of a share of Common Stock on
the date of such election multiplied by (y) the number of shares of Common Stock
as to which the Participant shall have made such election exceeds (ii) the total
exercise price for that number of shares of Common Stock under the terms of such
Option. If the Participant shall exercise Stock Appreciation Rights appertaining
to any Option, such Option shall thereafter remain exercisable, according to its
term, only with respect to the number of shares of Common Stock as to which it
would otherwise be exercisable less the number of shares of Common Stock with
respect to which such Stock Appreciation Rights have been exercised. Each Stock
Appreciation Right shall be subject to the same terms and conditions as the
related Option and shall be exercisable only to the extent the related Option is
exercisable.

SECTION 7.

RESTRICTED STOCK AND RESTRICTED UNITS

7.1. Grant of Restricted Stock and Restricted Units. Any award made hereunder of
Restricted Stock or Restricted Units shall be subject to the terms and
conditions of the Plan and to any other terms and conditions not inconsistent
with the Plan (including, but not limited to, requiring the Participant to pay
the Company an amount equal to the par value per share for each share of
Restricted Stock awarded) as shall be prescribed by the Committee in

 

- 15 -

--------------------------------------------------------------------------------

its sole discretion. As determined by the Committee, with respect to an award of
Restricted Stock, the Company shall either (i) transfer or issue to each
Participant to whom an award of Restricted Stock has been made the number of
shares of Restricted Stock specified by the Committee or (ii) hold such shares
of Restricted Stock for the benefit of the Participant for the Restricted
Period. In the case of an award of Restricted Units, no shares of Common Stock
shall be issued at the time an award is made, and the Company shall not be
required to set aside a fund for the payment of such award.

7.2. Restrictions on Transferability. Shares of Restricted Stock may not be
sold, assigned, transferred, pledged, hypothecated or otherwise encumbered by
the Participant during the Restricted Period, except as hereinafter provided.
Notwithstanding the foregoing, the Committee may permit (on such terms and
conditions as it shall establish) shares of Restricted Stock to be transferred
during the Restricted Period by the Participant to a member of the Participant’s
immediate family or to a trust or similar vehicle for the benefit of such
immediate family members, provided that any shares of Restricted Stock so
transferred shall remain subject to the provisions of this Section 7.

7.3. Rights as a Shareholder. Except for the restrictions set forth herein and
unless otherwise determined by the Committee, the Participant shall have all the
rights of a shareholder with respect to such shares of Restricted Stock,
including but not limited to, the right to vote and the right to receive
dividends. A Participant shall not have any right, in respect of Restricted
Units awarded pursuant to the Plan, to vote on any matter submitted to the
Company’s stockholders until such time as the shares of Common Stock
attributable to such Restricted Units have been issued. At the discretion of the
Committee, a Participant’s Restricted Unit account may be credited with Dividend
Equivalents during the Restricted Period.

7.4. Restricted Period. Unless the Committee shall otherwise determine at or
after the date an award of Restricted Stock or Restricted Units is made to the
Participant by the Committee, the Restricted Period shall commence upon the date
of grant and shall lapse with respect to the shares of Restricted Stock or
Restricted Units on the third anniversary of the date of grant, unless sooner
terminated as otherwise provided herein. Without limiting the generality of the
foregoing, the Committee may provide for termination of the Restricted Period
upon the achievement by the Participant of performance goals specified by the
Committee at the date of grant. The determination of whether the Participant has
achieved such performance goals shall be made by the Committee in its sole
discretion.

 

- 16 -

--------------------------------------------------------------------------------

7.5. Legend. Each certificate issued to a Participant in respect of shares of
Restricted Stock awarded under the Plan shall be registered in the name of the
Participant and Shall bear the following (or similar) legend:

“The shares of stock represented by this certificate are subject to the terms
and conditions contained in the American Standard Companies Inc. Stock Incentive
Plan and may not be sold, pledged, transferred, assigned, hypothecated or
otherwise encumbered in an manner (except as provided in Section 7.2 of the
Plan) until                     .”

7.6. Death, Disability or Retirement. Unless the Committee shall otherwise
determine at the date of grant, if a Participant ceases to be employed by the
Company or any Subsidiary by reason of death, Disability or Retirement, the
Restricted Period will lapse as to a pro rated portion of the shares of
Restricted Stock and Restricted Units transferred or issued to such Participant
under the Plan based on the number of days the Participant actually worked since
the date the shares of Restricted Stock or Restricted Units were granted (or in
the case of an award which becomes vested in installments, since the date, if
any, on which the last installment of such Restricted Stock or Restricted Units
became vested); provided that, in the case of an award with respect to which the
restrictions will lapse, if at all, based on the attainment of performance goals
or targets, such vesting shall be deferred until the end of the applicable
performance period and be based on that number of shares of Restricted Stock or
Restricted Units, if any, that would have been earned based on the attainment or
partial attainment of such performance goals or targets. Any shares of
Restricted Stock or Restricted Units as to which the Restricted Period has not
lapsed at the date of a Participant’s termination of employment by reason of
death, Disability or Retirement (or which do not become vested after such date
under the preceding sentence) shall revert back to the Company upon such
Participant’s termination of employment (or, if applicable, such deferred
vesting date).

7.7. Termination of Employment. Unless the Committee shall otherwise determine
at or after the date of grant, if a Participant ceases to be employed by the
Company or any Subsidiary for any reason other than those specified in
Section 7.6 at any time prior to the date when the Restricted Period lapses, all
shares of Restricted Stock held by the Participant shall revert back to the
Company and all Restricted Units and any Dividend Equivalents credited to

 

- 17 -

--------------------------------------------------------------------------------

such Participant shall be forfeited upon the Participant’s termination of
employment.

7.8. Issuance of New Certificates; Settlement of Restricted Units. Upon the
lapse of the Restricted Period with respect to any shares of Restricted Stock,
such shares shall no longer be subject to the restrictions imposed under
Section 7.2 and the Company shall issue or have issued new share certificates
without the legend described in Section 7.5 in exchange for those previously
issued. Upon the lapse of the Restricted Period with respect to any Restricted
Units, the Company shall deliver to the Participant, or the Participant’s
beneficiary or estate, as provided in Section 10.2, one share of Common Stock
for each Restricted Unit as to which restrictions have lapsed and any Dividend
Equivalents credited with respect to such Restricted Units and any interest
thereon. The Committee may, in its sole discretion, elect to pay cash or part
cash and part Common Stock in lieu of delivering only Common Stock for
Restricted Units. If a cash payment is made in lieu of delivering Common Stock,
the amount of such cash payment for each share of Common Stock to which a
Participant is entitled shall be equal to the Fair Market Value of the Common
Stock on the date on which the Restricted Period lapsed with respect to the
related Restricted Unit.

7.9. Performance Related Awards. Notwithstanding anything else contained in the
Plan to the contrary, unless the Committee otherwise determines at the time of
grant, any award of Restricted Shares or Restricted Units, or an award of Common
Stock or Restricted Units made in conjunction with other incentive plans
established by the Company, to an officer of the Company or a Subsidiary who is
subject to the reporting requirements of Section 16(a) of the Exchange Act,
other than an award which will vest solely on the basis of the passage of time,
shall become vested, if at all, upon the determination by the Committee that
performance objectives established by the Committee have been attained, in whole
or in part (a “Performance Award”), to the extent required to ensure that the
grant of such awards are deductible by the Company or such Subsidiary pursuant
to Section 162(m) of the Code. Such performance objectives shall be determined
over a measurement period or periods established by the Committee and related to
at least one of the following criteria, which may be determined solely by
reference to the performance of (i) the Company, (ii) a Subsidiary, (iii) an
affiliate of the Company, or (iv) a division or unit of any of the foregoing or
based on comparative performance of any of the foregoing relative to other
companies: (A) earnings per share; (B) revenues; (C) operating cash flow;
(D) operating earnings; (E) working capital; (F) inventory turnover rates;
(G) earnings to sales ratio; and (H) return on capital (the “Performance

 

- 18 -

--------------------------------------------------------------------------------

Criteria”). The maximum number of shares of Common Stock that may be subject to
any such Performance Award in any 12 month period shall not exceed 500,000
shares, as such number may be adjusted pursuant to Section 5.3.

SECTION 8.

CHANGE OF CONTROL

8.1. Accelerated Vesting and Payment. In the event of a Change of Control, the
Restricted Period with respect to each share of Restricted Stock and each
Restricted Unit will lapse and each Option and Stock Appreciation Right shall
become immediately exercisable on the date of such Change of Control.

8.2. Alternative Awards. Notwithstanding any provision of Section 6, any
Participant who holds on the date of a Change of Control an Option or Stock
Appreciation Right granted under this Plan shall be entitled to elect, during
the 60-days period immediately following such Change of Control, in lieu of
acquiring the shares of Common Stock covered by any such Option (or, in the case
of a Stock Appreciation Right, the amount of cash and Common Stock such
Participant would otherwise be entitled to receive upon the relinquishment of
the Option related to such Stock Appreciation Right), to receive, and the
Company shall be obligated to pay, the Change of Control Settlement Value with
respect to shares of Common Stock up to the number of shares covered by such
Option or Stock Appreciation Right, which amount shall be paid in cash.

8.3. No Amendment. Notwithstanding Section 9, the provisions of this Section 8
may not be amended in any respect following a Change of Control.

SECTION 9.

AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN

The Board may at any time terminate or suspend the Plan, and from time to time
may amend or modify the Plan. No action of the Board may, without the consent of
a Participant alter or impair his rights under any previously granted Incentive
Award.

 

- 19 -

--------------------------------------------------------------------------------

SECTION 10.

MISCELLANEOUS PROVISIONS

10.1. Nontransferability of Awards. Unless the Committee shall permit (on such
terms and conditions as it shall establish) an Incentive Award to be
transferred, no Incentive Award granted under the Plan may be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution. All rights with respect to any
Incentive Award granted to a Participant under the Plan shall be exercisable
during his lifetime only by such Participant or, if transferred as contemplated
by the previous sentence, a permitted transferee.

10.2. Beneficiary Designation. Each Participant under the Plan may from time to
time name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit under the Plan is to be paid or by whom any
right under the Plan is to be exercised in case of his death. Each designation
will revoke all prior designations by the same Participant, shall be in a form
prescribed by the Committee, and will be effective only when filed by the
Participant in writing with the Committee during his lifetime. In the absence of
any such designation, benefits remaining unpaid or Incentive Awards outstanding
at the Participant’s death shall be paid to or exercised by the Participant’s
surviving spouse, if any, or otherwise to or by his estate.

10.3. No Guarantee of Employment or Participation. Nothing in the Plan shall
interfere with or limit in any way the right of the Company or any Subsidiary to
terminate any Participant’s employment at any time, nor confer upon any
Participant any right to continue in the employ of the Company or any Subsidiary
or affiliate. No Employee or non-employee director shall have a right to be
selected as a Participant, or, having been so selected, to receive any future
Incentive Awards.

10.4. Tax Withholding. The Company shall have the power to withhold, or require
a Participant to remit to the Company promptly upon notification of the amount
due, an amount sufficient to satisfy Federal, state and local withholding tax
requirements on with respect to any Incentive Award, and the Company may defer
payment of cash or issuance or delivery of Common Stock until such requirements
are satisfied. The Committee may, in its discretion, permit a Participant to
elect, subject to such conditions as the Committee shall impose (i) to

 

- 20 -

--------------------------------------------------------------------------------

have Common Stock otherwise issuable or deliverable under the Plan withheld by
the Company or (ii) to deliver to the Company previously acquired shares of
Common Stock, in each case, having a Fair Market Value sufficient to satisfy not
more than the Participant’s statutory minimum Federal, state and local tax
obligation associated with the transaction.

10.5. Indemnification. Each person who is or shall have been a member of the
Committee or of the Board shall be indemnified and held harmless by the Company
against and from any loss, cost, liability, or expense that may be imposed upon
or reasonably incurred by him in connection with or resulting from any claim,
action, suit, or proceeding to which he may be made a party or in which he may
be involved by reason of any action taken or failure to act under the Plan and
against and from any and all amounts paid by him in settlement thereof, with the
Company’s approval, or paid by him in satisfaction of any judgment in any such
action, suit or proceeding against him, provided he shall give the Company an
opportunity, at its own expense, to handle and defend the same before he
undertakes to handle and defend it on his own behalf. The foregoing right of
indemnification shall not be exclusive and shall be independent of any other
rights of indemnification to which such persons may be entitled under the
Company’s Articles of Incorporation or By-laws, by contract, as a matter of law,
or otherwise.

10.6. No Limitation on Compensation. Nothing in the Plan shall be construed to
limit the right of the Company to establish other plans or to pay compensation
to its employees in cash or property, in a manner which is not expressly
authorized under the Plan.

10.7. Requirements of Law. The granting of Incentive Awards and the issuance of
shares of Common Stock shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.

10.8. Governing Law. The Plan, and all agreements hereunder, shall be construed
in accordance with and governed by the laws of the State of Delaware.

10.9. No Impact On Benefits. Incentive Awards granted under the Plan are not
compensation for purposes of calculating an Employee’s rights under any employee
benefit plan.

 

- 21 -

--------------------------------------------------------------------------------

10.10. Securities Law Compliance. Instruments evidencing Incentive Awards may
contain such other provisions, not inconsistent with the Plan, as the Committee
deems advisable, including (i) a provision limiting the period during which
Stock Appreciation Rights could be exercised to the extent required in order to
avoid the application of Section 16(b) of the Act in the case of officers of the
Company and (ii) a requirement that the Participant represent to the Company in
writing, when an Incentive Award is granted or when he receives shares with
respect to such Award (or at such other time as the Committee deems appropriate)
that he is accepting such Incentive Award, or receiving or acquiring such shares
(unless they are then covered by a Securities Act of 1933 registration
statement), for his own account for investment only and with no present
intention to transfer, sell or otherwise dispose of such shares except such
disposition by a legal representative as shall be required by will or the laws
of any jurisdiction in winding up the estate of the Participant. Such shares
shall be transferable only if the proposed transfer shall be permissible
pursuant to the Plan and if, in the opinion of counsel satisfactory to the
Company, such transfer at such time will be in compliance with applicable
securities laws.

10.11 Term of Plan. The Plan shall be effective upon its adoption by the Board
and approval by the holders of the Common Stock, provided, however, that in no
event shall the Plan become effective until immediately prior to the occurrence
of a Public Offering. The Plan shall expire on the tenth anniversary of the date
on which it is adopted by the Board (except as to Incentive Awards outstanding
on that date), unless sooner terminated pursuant to Section 9.

 

Adopted pursuant to duly authorized resolution

by the Board of Directors of the Company

on July 7, 2006

American Standard Companies Inc. By:   /s/ Mary Elizabeth Gustafsson   Mary
Elizabeth Gustafsson   Senior Vice President, General Counsel & Secretary

 

- 22 -