exv10w59



 





Exhibit-10.59




December 4, 2006




PERSONAL AND CONFIDENTIAL




Mr. Timothy R. Donovan

1310 Longmeadow Lane

Lake Forest, IL 60045




Dear Mr. Donovan:




     On behalf of Tenneco Inc. (the “Company”), I am pleased to set forth and confirm the
following additional terms and conditions of your continued service as Executive Vice President –
Strategy and Business Development and General Counsel of the Company. This letter agreement amends
your employment letter agreement with the Company dated July 11, 2000 (the “Original
Agreement”).


1. Base Salary. Your minimum base salary of $301,600 per year as set forth in
Paragraph 2 of the Original Agreement is hereby amended to be $439,662 per year, which will be
subject to such increases as may from time to time be approved by the Board or such committee of
the Board to which such power has been delegated (the “Committee”), payable according to
the regular pay schedule for salaried employees.



2. Annual Bonus. Your minimum annual target bonus of $155,000 as set forth in
Paragraph 3 of the Original Agreement is hereby amended such that, commencing with calendar year
2006, your annual target bonus will be, at least, $273,000 subject to fulfillment of performance
goals or other criteria as determined by the Board or Committee.



3. Amendment to KEPP and SERP. Effective as of August 31, 2006, you hereby consent and
agree to the following changes to (a) the Company’s Key Executive Pension Plan and its successor,
the Company’s Supplemental Pension Plan for Management (collectively, the “KEPP”), and (b)
the Company’s Supplemental Executive Retirement Plan and its successor, the Company’s Supplemental
Retirement Plan (collectively, the “SERP”). The Company may (i) amend the Supplemental
Retirement Plan to provide that (a) all of your benefit accruals under that plan will be frozen
effective as of December 31, 2006, (b) you shall not be a participant in that plan after December
31, 2006, (c) no compensation or service (for purposes of benefit accrual) for periods after
December 31, 2006 shall be taken into account under that plan, and (d) you will not accrue any
additional benefits under that plan after December 31, 2006, and (ii) amend the Supplemental
Pension Plan for Management, effective as of January 1, 2007, to (x) reduce from 4% to 3.6% the
annual rate (expressed as a percentage of final average compensation as defined in that plan) at
which you will accrue benefits under such plan


 









 






for each year of service earned after December 31, 2006, (y) reduce from 50% to 47.5% the maximum
accrual under such plan and (z) provide as an offset to benefits under such plan the actuarial
equivalent value (determined in accordance with the assumptions used for such purpose under such
plan) of any amounts paid to you in respect of “DB Replacement Contributions” as described in the
Company’s Current Report on Form 8-K dated August 23, 2006.



4. Governing Law; No Other Amendments. This letter agreement shall be governed by, and
shall be construed in accordance with, the internal laws (and not the laws of conflicts) of the
State of Illinois. Except as expressly set forth herein, the Original Agreement shall not be
amended or modified hereby. The Original Agreement shall, as expressly amended hereby, remain in
full force and effect.




	 	 	 	 	 	 	 
	 	 	Sincerely,
	 
	 	 	 	 	 	 
	 	 	TENNECO INC.
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard P. Schneider	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	SVP Global Administration	 	 






ACKNOWLEDGED AND ACCEPTED




	 	 	 	 	 	 	 	 	 
	/s/ Timothy R. Donovan

		 	 	Date:
	 	December 5, 2006	 	 
	 

Timothy R. Donovan