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                               TRUST AGREEMENT FOR

                           THE AMERICAN STANDARD INC.

              SUPPLEMENTAL COMPENSATION PLAN FOR OUTSIDE DIRECTORS

      This Trust Agreement dated as of March 7, 1996, by and among American
Standard Companies Inc., a Delaware corporation, American Standard Inc., a
Delaware corporation, and Robert M. Kennedy, as Trustee, provides, on the terms
and conditions set forth below, for the establishment and administration of a
trust to hold shares of Common Stock issued as payouts under the American
Standard Inc. Supplemental Compensation Plan for Outside Directors.

1. Definitions.

      For purposes of this Trust Agreement, the following definitions shall
apply:

      1.1. Act means the Securities Exchange Act of 1934, as amended.

      1.2. ASCI means American Standard Companies Inc., a Delaware corporation,
which is the successor in interest to ASI Holding Corporation.

      1.3. ASCI Board means the Board of Directors of ASCI.

      1.4. ASI Board means the Board of Directors of the Company.

      1.5. Beneficiary means any one person or trust appointed by a Participant
in an unrevoked writing filed with the Company directing that, in the event of
such Participant's death, all of such Participant's rights under and interests
in the Plan, as recorded pursuant to this Trust, shall vest in such person or
trust, provided that a Participant's Beneficiary shall be deemed to be the
estate or legal representative of such Participant if such written appointment
is revoked and not replaced by another such written appointment filed with the
Company, or if a Participant's Beneficiary does not survive such Participant.

      1.6. Change of Control means the occurrence of any of the following
events:

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            (i) any person is or becomes the Beneficial Owner, directly or
      indirectly, of securities of ASCI representing 15% or more of the combined
      voting power of ASCI'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 ASCI, or solely
      as a result of an acquisition by ASCI of ASCI's securities, until such
      time thereafter as such person acquires additional voting securities other
      than directly from ASCI 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 ASCI 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 ASCI's
      then-outstanding securities;

            (ii) during any period of two consecutive years beginning after
      December 1, 1996, individuals who at the beginning of such period
      constitute the ASCI Board together with those individuals who first become
      directors during such period (other than by reason of an agreement with
      ASCI or the ASCI Board in settlement of a proxy contest for the election
      of directors) and whose election or nomination for election to the ASCI
      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 ASCI Board;

            (iii) the shareholders of ASCI approve a merger, consolidation,
      recapitalization or reorganization of ASCI, or a reverse stock split of
      any class of voting securities of ASCI, 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 ASCI 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 ASCI 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


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      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 ASCI or of such surviving entity
      or of any subsidiary of ASCI or such surviving entity and (b) voting
      securities beneficially owned by such persons who receive them other than
      as holders of voting securities of ASCI 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 ASCI approve a plan of complete liquidation
      or dissolution of ASCI or an agreement for the sale or disposition of all
      or substantially all the assets of ASCI 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 ASCI 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 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 ASCI: (A) any person who has entered into a binding
      agreement with ASCI, 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 ASCI (a
      "Standstill Agreement"); (B) any employee benefit plan, or trustee or
      other fiduciary thereof, maintained by ASCI or any subsidiary of ASCI; (C)
      any subsidiary of ASCI; or (D) ASCI.

      (2) Unless a majority of the Continuing Directors 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 ASCI of or by another entity (whether by


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      the merger or consolidation, the acquisition of stock or assets, or
      otherwise) in exchange, in whole or in part, for securities of ASCI,
      provided that, immediately following such acquisition, the Continuing
      Directors constitute a majority of the ASCI Board, or a majority of the
      board of directors of any other surviving entity, and, in either case, no
      agreement, arrangement or understanding exists at that time which would
      cause such Continuing Directors to cease thereafter to constitute a
      majority of the ASCI 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 ASCI.

      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.

      1.7. Change of Control Stock Value means the value of a share of Common
Stock determined as follows:


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            (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 ASCI 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 ASCI 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.

      1.8. Common Stock means the common stock, par value $0.01 per share, of
ASCI.

      1.9. Company means American Standard Inc., a Delaware corporation.

      1.10. Creditor means a general creditor of ASCI, the Company or a
Subsidiary, as appropriate, and Judgment Creditor means a Creditor who has
obtained a judgment against ASCI, the Company or a Subsidiary, as appropriate,
from a court of competent jurisdiction and who has made written demand to ASCI,
the Company or such Subsidiary for payment on such judgment which has gone
unsatisfied for at least 180 days.

      1.11. Fair Market Value on any date means the closing price of a Share on
such date as reported on the New York Stock Exchange consolidated reporting
system.

      1.12. Insolvent means the inability to pay debts as they mature or being
subject to proceedings as a debtor under the United States Bankruptcy Code, and
Insolvency means the state of being insolvent.

      1.13. Participant means a member of the ASI Board who is not an employee
of ASI.


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      1.14. Plan means American Standard Inc. Supplemental Compensation Plan for
Outside Directors, as such is in effect from time to time.

      1.15. Plan Administrator means the Secretary of the Company.

      1.16. Plan Payout means a payment made pursuant to Sections 2 or 3 of the
Plan.

      1.17. Prime Rate means the rate of interest publicly announced from time
to time by the New York City office of Citibank N.A. as its prime or reference
rate, adjusted as of the first business day of each calendar quarter.

      1.18. Share means a share of Common Stock.

      1.19. Share Award Account means a separate account established under the
Trust with respect to which the Participant's interests under the Plan are
credited.

      1.20. Subsidiary means a corporation in which the Company owns, directly
or indirectly, more than 50% of the voting power represented by stock entitled
to vote for the election of directors, or a partnership in which the Company
owns, directly or indirectly, at least 50% of the capital or profits interests
in such partnership.

      1.21. Termination Date of a Participant means the date on which such
Participant's membership with the Board of ASI terminates for any reason,
including death.

      1.22. Trust means the trust fund established under this Trust Agreement.

      1.23. Trustee means Robert M. Kennedy or such successor trustee as shall
be appointed by the ASI Committee pursuant to Section 19 hereof.

2. Establishment and Duration of Trust; Trustees Powers.

      The Trust is hereby established under the Plan to fulfill certain
obligations thereunder of ASCI and the Company to Participants. ASCI and the
Company shall remain primarily responsible to fulfill payment obligations under
the Plan. To the extent payments are made from the Trust, the employer's
liability to make payments shall be reduced correspondingly. The Trust shall
continue in effect until terminated by action of the ASI Board; provided that
the Trust shall in any event terminate when all amounts owed to Participants
have been paid or the Trust has been exhausted. The Trust is intended to be a
grantor trust within the meaning


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of Sections 671 through 679 of the Internal Revenue Code of 1986, as needed (the
"Code").

      The Trustee shall invest and reinvest the assets of the Trust without
distinction between principal and income; provided, however, that the Trustee
shall hold in the Trust all Shares that it receives, and the Trustee shall
distribute such Shares to the Participants (or to their Beneficiaries) entitled
to such distributions when and as directed by the Plan Administrator in
accordance with the terms of the Plan. The Plan Administrator shall direct the
investment of any cash contributions to the Trust in its discretion. Pending
investment of any such cash contributions, the Trustee may temporarily invest
and reinvest such contributions in any marketable short- and medium-term fixed
income securities, United States Treasury Bills, other short- and medium-term
government obligations, commercial paper, other money market instruments and
part interests in any one or more of the foregoing, or may maintain cash
balances consistent with the liquidity needs of the Trust as determined by the
Trustee. The Plan Administrator may direct the Trustee to maintain separate
investment funds, allocate contributions among such funds, and make transfers
among such funds.

      Subject to the provisions hereof, the Trustee shall be authorized and
empowered to exercise any and all of the following rights, powers and privileges
with respect to any cash, securities or other properties held by the Trustee in
trust hereunder:

      1. To sell, exchange, mortgage or lease any such property and to convey,
transfer or dispose of any such property on such terms and conditions as the
Trustee deems appropriate.

      2. To grant options for the sale, transfer, exchange or disposal of any
such property and to exercise any subscription rights or conversion privileges
with respect to any securities held in the Trust Fund.

      3. To exercise all voting rights pertaining to any securities, provided
that Shares credited to Share Award Accounts of Participants shall be voted as
directed by such Participants ; to consent to or request any action on the part
of the issuer of any such securities; and to give general or special proxies or
powers of attorney with or without power of substitution.

      4. To collect and receive any and all money and other property of
whatsoever kind or nature due or owing or belonging to the Trust Fund and to
give full discharge and acquaintance therefor; and to extend the time of payment
of any obligation at any time owing


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to the Trust Fund, as long as such extension is for a reasonable period and
continues reasonable interest.

      5. To cause any securities or other property to be registered in, or
transferred to, the individual name of the Trustee or in the name of one or more
of its nominees, or one or more nominees of any system for the centralized
handling of securities, or to retain such investments unregistered and in form
permitting transferability by delivery (provided that the books and records of
the Trust at all times show that all such investments are a part of the Trust
Fund).

      6. To settle, compromise or submit to arbitration any claims, debts or
damages due or owing to or from the Trust; to commence or defend suits or legal
proceedings whenever, in its judgment, any interest of the Trust requires it;
and to represent the Trust in all suits or legal proceedings in any court of law
or equity or before any other body or tribunal, insofar as such suits or
proceedings relate to any property forming part of the Trust Fund or to the
administration of the Trust Fund.

      7. Generally, to do all acts, whether or not expressly authorized, which
are necessary or appropriate to carry out the intent of this Trust Agreement.

3. Contribution of Shares to Trust.

      As of the date any Plan Payout authorized under the Plan which consists in
whole or in part of Shares is made, ASCI or the Company shall contribute to the
Trust, for credit to the Share Award Account of each Participant who is granted
such a Plan Payout, that number of whole and fractional Shares credited to such
Participant under the Plan.

4. Share Award Accounts.

      Each Participant's Share Award Account shall record the number of Shares
and fractions thereof credited to such Share Award Account as a Plan Payout and
the date as of which each such Plan Payout was made.


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5. Voting Rights.

      Shares credited to each Participant's Share Award Account shall be voted
by the Trustee as directed by such Participant.

6. Distributions from Trust.

      The Plan Administrator may at any time prior to a Change of Control direct
that the Shares and any other property ("Non-Share Interests") credited to a
Participant's Share Award Account be distributed from the Trust. If not earlier
distributed in accordance with the foregoing sentence, upon the termination of a
Participant's membership on the ASI Board, other than a termination for cause,
prior to a Change of Control, such Participant (or, in the event of his death,
his Beneficiary) shall be entitled to a distribution from the Trust of all
Shares and Non-Share Interests credited to his Share Award Account. In the event
that a Participant's membership on the Board is terminated for cause, such
Participant shall forfeit all interest to his or her Share Award Account and any
Shares in such account shall revert back to ASCI.

7. Change of Control.

      Upon a Change of Control, each Participant shall be entitled to receive a
lump sum cash payment equal to the sum of (i) the Change of Control Stock Value
of all Shares credited to his Share Award Account and (ii) the value of any
Non-Share Interests credited to his Share Award Account (unless within one (1)
business day following such a Change of Control, such Participant has delivered
written notice to the Trustee pursuant to Section 10 hereof requesting a
distribution from the Trust of all Shares and/or Non-Share Interests credited to
such Participant's Share Award Account in the event of a Change of Control, in
lieu of a cash payment equal to the Change of Control Stock Value of such Shares
and/or the value of Non-Share Interests, in which case such Participant shall be
entitled to receive a distribution of all Shares and/or Non-Share Interests
credited to such Participant's Share Award Account) as soon as practicable. Upon
a Change of Control, the Trustee shall determine as promptly as practicable the
Change of Control Stock Value of the Shares in the Trust and shall promptly
thereafter deliver a written notice (the "Trustee Notice") to the Company
setting forth such Change of Control Stock Value and the manner of its
determination and requesting that the Company purchase all Shares in the Trust
(except for Shares credited to Participants' Share Award Accounts as to which
Participants have requested a distribution in the event of a


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Change of Control in lieu of a cash payment equal to the Change of Control Value
therefor). A copy of such Trustee Notice shall be sent to each Participant.
Following the receipt of the Trustee Notice, the Company shall, within three (3)
business days following the Company's receipt of such Trustee Notice, make a
cash payment to the Trustee equal to the Change of Control Stock Value of such
Shares against delivery of such Shares by the Trustee to the Company. In the
event that the Company shall not have made such cash payment to the Trustee
within such (3) business day period, interest on the amount owing to the Trustee
will accrue at a rate per annum equal to the Prime Rate plus 4% and shall be
compounded monthly until paid. Upon a Change of Control, the Trustee shall sell
as promptly as practicable the Non-Share Interests (other than cash) of the
Trust (except for such Non-Share Interests credited to Participants' Share Award
Accounts as to which Participants have requested a distribution in-kind in the
event of a Change of Control in lieu of a cash payment equal to the value
therefor). Upon receipt by the Trustee of (i) the cash payment from the Company
for the Shares and (ii) the proceeds from the sale of the Non-Share Interests
(other than cash), the Trustee shall make to each Participant the lump-sum cash
payment contemplated by the first sentence of this Section 7 with interest, if
any, accrued pursuant to this Section 7, plus a cash payment equal to the cash,
if any, credited to such Participant's Share Award Account. For purposes of this
Section 7, the Trustee's determination of the Change of Control Stock Value of a
Participant in the Trust shall be binding and conclusive.

8. Issuance of Share Certificates.

      If a Participant (or, in the event of his death, his Beneficiary) receives
a distribution of Shares pursuant to Section 6 or 7, the Trustee shall deliver
to such Participant or Beneficiary a certificate or certificates evidencing the
Shares credited to such Participant's Share Award Account, as soon as
administratively practicable after the Participant's Termination Date or a
Change of Control, as the case may be.

9. Changes in Capital Structure.

      In the event of the payment of any dividend payable in, or the making of
any distribution of, Shares to holders of record of Shares during the period any
Shares awarded under the Plan are credited to a Participant's Share Award
Account; or in the event of any


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stock split, combination of Shares, recapitalization or other similar change in
the authorized capital stock of ASCI during such period; or in the event of the
merger or consolidation of ASCI into or with any other corporation or the
reorganization, dissolution or liquidation of ASCI during such period; there
shall be credited to such Participant's Share Award Account such new, additional
or other shares of capital stock of any class, or other property (including
cash), as such Participant would be entitled to receive as a matter of law if
such Participant were a shareholder of ASCI at the time of such event.

10. Administration.

      This Trust Agreement shall be administered by the Plan Administrator, who
shall have full power and authority (to the extent not inconsistent with the
terms and purposes of the Plan and this Trust Agreement) prior to a Change of
Control to interpret and carry out the terms of, and to establish, amend or
rescind rules and regulations relating to, this Trust Agreement; to appoint a
recordkeeper for this Trust Agreement and to rescind any such appointment; and
to take such other actions and to make such other determinations relating to
this Trust Agreement as may be necessary or advisable in connection with the
Plan. The Plan Administrator may by written direction delegate to any agent or
agents it shall appoint, including any officer or employee of the Company or
ASCI, the authority to exercise any of its administrative duties and
responsibilities hereunder.

      All forms required to be filed hereunder and all other communications with
respect hereto shall be addressed to the Secretary, American Standard Inc., One
Centennial Avenue, Piscataway, New Jersey, 088556820, or to such other address
as the Plan Administrator, ASI Committee, ASCI, the Company or the Trustee, as
the case may be, may designate from time to time.

11. Trust Subject to Creditor Claims.

      Notwithstanding any other provision of this Trust Agreement or the Plan,
the Trustee shall hold the assets of the Trust for the benefit of Creditors to
the extent provided in Sections 12 and 13 hereof. No Participant or Beneficiary
shall have any rights greater than the rights of any other unsecured Creditor,
and no Participant or Beneficiary shall have any right against or


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security interest in the Trust. The Chief Executive Officer or Chief Financial
Officer of ASCI, the Company or each Subsidiary shall have the duty to inform
the Trustee in writing of the Insolvency of ASCI, the Company or any such
Subsidiary, as the case may be.

12. Effects of Insolvency.

      Upon receipt prior to a Change of Control of any written allegation of the
Insolvency of ASCI or the Company, the Trustee shall suspend the making of any
distribution from the Trust and shall immediately notify ASCI or the Company in
writing of such allegation. Within 30 days of receipt of such an allegation, the
Trustee shall determine whether ASCI or the Company is Insolvent. If the Trustee
determines ASCI or the Company to be Insolvent, or if the Trustee otherwise has
actual knowledge that ASCI or the Company is Insolvent, the Trustee shall cease
making distributions hereunder and shall hold the portion of the Trust held for
the benefit of such entity for the benefit of its Creditors until otherwise
instructed by a court of competent jurisdiction. If the Trustee determines that
ASCI or the Company is not Insolvent, the Trustee shall resume making
appropriate distributions from the Trust to Participants and Beneficiaries in
accordance with this Agreement. Notwithstanding the foregoing, if the ASCI
Board, the ASI Board, the Chief Executive Officer or the Chief Financial Officer
of ASCI or the Company delivers to the Trustee a sworn statement that ASCI or
the Company is Insolvent, the Trustee shall make distributions from the portion
of the Trust held for the benefit of such entity only as directed by a court of
competent jurisdiction, until such time as the Trustee determines that ASCI or
the Company, as the case may be, is not Insolvent.

13. Judgment Creditor Claims.

      In addition to the rights of Creditors set forth in Section 12 hereof, and
notwithstanding any other provision of this Trust Agreement, the assets of the
Trust shall at all times prior to a Change of Control be available to satisfy
claims of Judgment Creditors. Upon receipt by the Trustee of proof satisfactory
to the Trustee that a Creditor is a Judgment Creditor, the Trustee shall satisfy
the claim of such Judgment Creditor, to the extent possible, from the assets of
the Trust, and the Trustee shall be fully indemnified hereunder in satisfying
such claim.


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14. Distributions Due to Certain Tax Consequences.

      Notwithstanding any provision of this Trust Agreement other than Sections
12 and 13 hereof, if a Participant (or Beneficiary) is determined to be subject
to United States federal income tax on any portion of his interest in the Trust
prior to the time of distribution of such interest that portion of such interest
shall be distributed by the Trustee to such Participant or Beneficiary. A
portion of a Participant's (or Beneficiary's) interest in the Trust shall be
determined to be subject to United States federal income tax upon the earliest
of (i) receipt by the Participant (or Beneficiary) of a notice of deficiency
from the United States Internal Revenue Service with respect to such interest
which is not contested by such Participant (or Beneficiary); (ii) execution of a
closing agreement between the Participant (or Beneficiary) and the Internal
Revenue Service which provides that such interest is includible in the
Participant's (or Beneficiary's) gross income; and (iii) a final determination
by the United States Tax Court or any other federal court which holds that such
interest is includible in the Participant's (or Beneficiary's) gross income.

15. Reports and Records.

      The Trustee shall:

      15.1. keep accurate and detailed accounts of all investments, receipts,
disbursements and other transactions in the Trust as he shall deem necessary and
proper with respect to his administration of the Trust, and permit inspection of
such accounts, records and assets of the Trust by any duly authorized
representative of the Company or ASCI at any time during usual business hours;

      15.2. make such periodic reports to the Company or ASCI as it shall
reasonably request;

      15.3. prepare and timely file such tax returns and other reports, together
with supporting data and schedules, as may be required of the Trustee by law,
with any taxing authority or any other government authority, whether local,
state or federal.


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      16. Taxes.

      ASCI and the Company agree that their respective share of all income,
deductions and credits of the Trust belong to them as owners for income tax
purposes and shall, as appropriate, be included on their tax returns. The
Company or ASCI shall from time to time pay taxes (references in this Trust
Agreement to the payment of taxes shall include interest and applicable
penalties) of any and all kinds whatsoever which at any time are lawfully levied
or assessed upon or become payable in respect of the Trust, the income or any
property forming a part thereof, or any security transaction pertaining thereto.
Any amounts distributed from the Trust shall be reduced by the amount of any
withholding taxes required by law, and the Trustee shall have the responsibility
to withhold and pay such amounts to the appropriate governmental authorities.
The Trustee shall inform the Company and ASCI in writing of all amounts withheld
and of all distributions hereunder to a Participant or Beneficiary. The Trustee
shall be entitled to satisfy such withholding tax obligations and payments to a
Participant or Beneficiary by retaining an appropriate number of Shares and
selling such Shares.

17. For the Benefit of the Trustee.

      17.1. Expenses of the Trustee. The Company or ASCI shall reimburse the
Trustee for any expenses incurred by the Trustee including, but not limited to,
all proper charges and disbursements of the Trustee, and reasonable fees for
legal services rendered to the Trustee (whether or not rendered in connection
with a judicial or administrative proceeding). The Trustee's entitlement to
reimbursement hereunder shall not be affected by the resignation or removal of
the Trustee or by the termination of the Trust.

      17.2. Indemnification of Trustee. ASCI or the Company shall indemnify,
defend and hold the Trustee harmless from and against any claim, liability, cost
or expense (including reasonable attorneys' fees) asserted against, imposed on
or suffered or incurred by the Trustee in the good-faith carrying out of his
duties and responsibilities hereunder and in his good-faith compliance with any
written instructions delivered to him by the Company or ASCI with respect
thereto.


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18. Resignation and Removal of Trustee.

      The Trustee may be removed by the Plan Administrator at any time with the
approval of Participants whose Share Award Accounts comprise 75% or more of the
Shares held by the Trust. The Trustee may resign at any time upon notice in
writing to the Company and ASCI.

19. Successor Trustee.

      Upon the removal, resignation or death of the Trustee, the Plan
Administrator may designate a successor Trustee to act hereunder, which shall
have the same powers and duties as those conferred upon the Trustee. Upon such
designation, and upon the written acceptance of the successor Trustee, the
former Trustee shall, if necessary, assign, transfer and pay over to such
successor Trustee the assets then constituting the Trust. A successor Trustee
shall have all the rights and powers under this Trust Agreement as an original
Trustee.

20. Amendment of Trust.

      All contributions made by ASCI or the Company shall be irrevocable unless
the benefits payable hereunder have been otherwise paid to the Participants by
ASCI or the Company; provided that, the Company or ASCI may amend, in whole or
in part, any or all of the provisions of this Trust Agreement, provided that no
such amendment may affect the rights, protections, duties or responsibilities of
the Trustee without his consent and, provided further, that no such amendment
may (a) permit any part of the corpus or income of the Trust to be returned or
diverted to the Company or ASCI or (b) diminish, reduce, alter, or impair any
Participant's Share Award Account without such Participant's consent.

21. No Right of Alienation.

      Except as required in Sections 11 through 13 hereof, at no time prior to
the satisfaction of all liabilities with respect to Participants and their
Beneficiaries shall any part of the corpus and/or income of the Trust be used
for, or diverted to purposes other than for the exclusive purpose of providing
benefits to Participants and their Beneficiary. No Participant or Beneficiary
shall have any right or interest in the assets of the Trust which is greater
than the rights of any Creditor. The assets of the Trust shall not be subject to
anticipation, alienation,


                                      -15-
<PAGE>   16

sale, transfer, assignment, pledge, encumbrance or charge.

22. Headings.

      Section headings in this Trust Agreement are for reference only. In the
event of a conflict between a heading and the content of a Section, the content
of the Section shall control.

23. Construction.

      This Trust Agreement shall be construed and regulated by the laws of the
State of New York except where such laws are superseded by federal laws.

24. Successors.

      This Trust Agreement shall be binding upon, and the powers herein granted
to the ASI Committee, the Company, ASCI and the Trustee, respectively, shall be
exercisable by, the respective successors and assigns of the ASI Committee, the
Company, ASCI and the Trustee.

25. Separability.

      If any part of this Trust Agreement shall be found to be invalid or
unenforceable, such invalidity or unenforceability shall not affect the
remaining provisions hereof. Such invalid or unenforceable part shall be fully
separable and this Trust Agreement shall be construed and enforced as if such
part had not been inserted herein.

26. Gender and Number.

      Whenever used herein, the masculine shall be interpreted to include the
feminine and neuter, the neuter to include the masculine and feminine, the
singular to include the plural and the plural to include the singular, in each
case unless the context requires otherwise.


                                      -16-
<PAGE>   17

27. Assignment.

      The benefits payable under this Trust Agreement may not be assigned,
alienated, pledged, attached or garnished.

      IN WITNESS WHEREOF, each of the parties hereto has executed or caused to
be executed this Trust Agreement as of the date and year first written above.

                                       AMERICAN STANDARD COMPANIES INC.


                                       ----------------------------------
                                       By: Adrian B. Deshotel

                                       Its: Vice President - Human Resources


                                       AMERICAN STANDARD INC.


                                       ----------------------------------
                                       By: Adrian B. Deshotel

                                       Its: Vice President - Human Resources



                                       THE TRUSTEE:

                                       ----------------------------------
                                       ROBERT M. KENNEDY


                                      -17-