EX-10.32






Exhibit 10.32




ITT Corporation

Senior Executive Severance Pay Plan




1. Purpose




     The purpose of this ITT Corporation Senior Executive Severance Pay Plan (“Plan”) is to assist
in occupational transition by providing severance pay for employees covered by this Plan whose
employment is terminated under conditions set forth in this Plan.



2. Covered Employees




     Covered employees under this Plan (“Executives”) are full-time, regular salaried employees of
ITT Corporation (“ITT”) and of any subsidiary company (“ITT Corporation Subsidiary”) (collectively
or individually as the context requires “Company”) who are United States citizens, or who are
employed in the United States, in Band A at any time within the two year period immediately
preceding the date the Company selects as the Executive’s last day of active employment (“Scheduled
Termination Date”).



3. Severance Pay Upon Termination of Employment




     If the Company terminates an Executive’s employment, the Executive shall be provided severance
pay in accordance with the terms of this Plan except where the Executive:




	 	•	 	is terminated for cause,
	 
	 	•	 	accepts employment or refuses comparable employment with a purchaser as provided in
Section 8, “Divestiture”,
	 
	 	•	 	is terminated with a Scheduled Termination Date on or after the Executive’s Normal
Retirement Date as defined herein, or
	 
	 	•	 	voluntarily terminates employment with the Company prior to the Scheduled Termination
Date.
	 
	 	 	 	No severance pay will be provided under this Plan where the Executive terminates employment by:
	 
	 	•	 	voluntarily resigning,
	 
	 	•	 	voluntarily retiring, or
	 
	 	•	 	failing to return from an approved leave of absence (including a medical leave of
absence).





            No severance pay will be provided under this Plan upon any termination of employment as a
result of the Executive’s death or disability.




            “Normal Retirement Date” shall mean the first of the month which coincides with or follows the
Executive’s 65th birthday.










 



 




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4. Schedule of Severance Pay




     Severance pay will be provided in accordance with the following Schedule of Severance Pay
which sets forth the months of Base Pay which is provided to an Executive based upon the
Executive’s Years of Service as of the Scheduled Termination Date.



	 	 	 	 	 	 	 	 	 
	Years of Service	 	 	 	 	 	Months of Base Pay
	Less than 4
	 	 	 	 	 	 	12	 
	4
	 	 	 	 	 	 	13	 
	5
	 	 	 	 	 	 	14	 
	6
	 	 	 	 	 	 	15	 
	7
	 	 	 	 	 	 	16	 
	8
	 	 	 	 	 	 	17	 
	9
	 	 	 	 	 	 	18	 
	10
	 	 	 	 	 	 	19	 
	11
	 	 	 	 	 	 	20	 
	12
	 	 	 	 	 	 	21	 
	13
	 	 	 	 	 	 	22	 
	14
	 	 	 	 	 	 	23	 
	15
	 	or more	 	 	24	 






     “Base Pay” shall mean the annual base salary rate payable to the Executive at the Scheduled
Termination Date divided by twelve (12) months. Such annual base salary rate shall in no event be
less than the highest annual base salary rate paid to the Executive at any time during the
twenty-four month (24) period immediately preceding the Scheduled Termination Date.



     “Years of Service” shall mean the total number of completed years of employment since the
Executive’s ITT system service date to the Scheduled Termination Date, rounded to the nearest whole
year. The ITT system service date is the date from which employment in the ITT system is
recognized for purposes of determining eligibility for vesting under the applicable Company
retirement plan covering the Executive on the Scheduled Termination Date.



     Notwithstanding the above Schedule of Severance Pay, (i) in no event shall months of Base Pay
provided to an Executive exceed the number of months remaining between the Scheduled Termination
Date and the Executive’s Normal Retirement Date or (ii) shall severance pay exceed the equivalent
of twice the Executive’s total annual compensation during the year immediately preceding the
Scheduled Termination Date.



5. Form of Payment of Severance Pay




     Severance pay shall be paid in the form of periodic payments according to the regular payroll
schedule (“Severance Pay”).



     Severance Pay will commence within 60 days following the Scheduled Termination Date.



     In the event of an Executive’s death during the period the Executive is receiving Severance
Pay, the amount of severance pay remaining shall be paid in a discounted lump sum to the
Executive’s spouse or to such other beneficiary or beneficiaries designated by the Executive in
writing, or, if the Executive is not married and failings such designation, to the estate of the
Executive. Any discounted lump sum paid under this Plan shall be equal to the present value of the
remaining periodic payments of severance pay as









 



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determined by ITT using an interest rate equal to the prime rate at Citibank in effect on the date
of the Executive’s death.



     If an Executive is receiving Severance Pay, the Executive must continue to be available to
render to the Company reasonable assistance, consistent with the level of the Executive’s prior
position with the Company, at times and locations that are mutually acceptable. In requesting such
services, the Company will take into account any other commitments which the Executive may have.
After the Scheduled Termination Date and normal wind up of the Executive’s former duties, the
Executive will not be required to perform any regular services for the Company. In the event the
Executive secures other employment during the period the Executive is receiving Severance Pay, the
Executive must promptly notify the Company.


Severance Pay will cease if an Executive is rehired by the Company.




6. Benefits During Severance Pay




     As long as an Executive is receiving Severance Pay, except as provided in this Section or in
Section 7, the Executive will continue to be eligible for participation in Company employee benefit
plans in accordance with the provisions of such plans as in effect on the Scheduled Termination
Date. An Executive will not be eligible to participate in any Company tax qualified retirement
plans, non-qualified excess or supplemental benefit plans, short-term or long-term disability
plans, the Company business travel accident plan or any new employee benefit plan or any
improvement to any existing employee benefit plan adopted by the Company after the Scheduled
Termination Date.



7. Excluded Executive Compensation Plans, Programs, Arrangements, and Perquisites




     During the period an Executive is receiving Severance Pay, the Executive will not be eligible
to accrue any vacation or participate in any (i) bonus program, (ii) special termination programs,
(iii) tax or financial advisory services, (iv) new awards under any stock option or stock related
plans for executives (provided that the Executive will be eligible to exercise any outstanding
stock options in accordance with the terms of any applicable stock option plan), (v) new or revised
executive compensation programs that may be introduced after the Scheduled Termination Date and
(vi) any other executive compensation program, plan, arrangement, practice, policy or perquisites
unless specifically authorized by ITT in writing. The period during which an Executive is
receiving Severance Pay does not count as service for the purpose of any ITT long term incentive
award program including, but not limited to, the ITT Restricted Stock Award Plan (1984) and any
similar plan, and the ITT Long-Term Performance Plan and any similar plan unless otherwise provided
in plan documents previously approved by the Board of Directors or Compensation and Personnel
Committee.



8. Divestiture




     If an ITT Subsidiary or division of ITT or a portion thereof at which an Executive is employed
is sold or divested and if (i) the Executive accepts employment or continued employment with the
purchaser or (ii) refuses employment or continued employment with the purchaser on terms and
conditions substantially comparable to those in effect immediately preceding the sale or
divestiture, the Executive shall not be provided severance pay under this Plan. The provisions of
this Section 8 apply to divestitures accomplished through sales of assets or through sales of
corporate entities.



9. Disqualifying Conduct




     If during the period an Executive is receiving Severance Pay, the Executive (i) engages in any
activity which is inimical to the best interests of the Company; (ii) disparages the Company; (iii)
fails to comply with any Company Covenant Against Disclosure and Assignment of Rights to
Intellectual









 



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Property; (iv) without the Company’s prior consent, induces any employees of the Company to leave
their Company employment; (v) without the Company’s prior consent, engages in, becomes affiliated
with, or becomes employed by any business competitive with the Company; or (vi) fails to comply
with applicable provisions of the ITT Code of Conduct or applicable ITT Corporate Policies or any
applicable ITT Subsidiary Code or policies, then the Company will have no further obligation to
provide severance pay.



10. Release




     The Company shall not be required to make or continue any severance payments under this Plan
unless the Executive executes and delivers to ITT within 45 days following the Scheduled
Termination Date a release, satisfactory to ITT, in which the Executive discharges and releases the
Company and the Company’s directors, officers, employees and employee benefit plans from all claims
(other than for benefits to which Executive is entitled under any Company employee benefit plan)
arising out of Executive’s employment or termination of employment.



11. Administration of Plan




     This Plan shall be administered by ITT, who shall have the exclusive right to interpret this
Plan, adopt any rules and regulations for carrying out this Plan as may be appropriate and decide
any and all matters arising under this Plan, including but not limited to the right to determine
appeals. Subject to applicable Federal and state law, all interpretations and decisions by ITT
shall be final, conclusive and binding on all parties affected thereby.



12. Termination or Amendment




     ITT may terminate or amend this Plan (“Plan Change”) at any time except that no such Plan
Change may reduce or adversely affect severance pay for any Executive whose employment terminates
within two years of the effective date of such Plan Change provided that the Executive was a
covered employee under this Plan on the date of such Plan Change.



13. Offset




     Any severance pay provided to an Executive under this Plan shall be offset in a manner
consistent with Section 15 by reducing such severance pay by any severance pay, salary
continuation, termination pay or similar pay or allowance which Executive receives or is entitled
to receive (i) under any other Company plan, policy practice, program, arrangement; (ii) pursuant
to any employment agreement or other agreement with the Company; (iii) by virtue of any law, custom
or practice. Any severance pay provided to Executive under this Plan shall also be offset by
reducing such severance pay by any severance pay, salary continuation pay, termination pay or
similar pay or allowance received by the Executive as a result of any prior termination of
employment with the Company.



     Coordination of severance pay with any pay or benefits provided by any applicable ITT
short-term or long-term disability plan shall be in accordance with the provisions of those plans.



14. Miscellaneous




     Except as provided in this Plan, the Executive shall not be entitled to any notice of
termination or pay in lieu thereof.



     In cases where severance pay is provided under this Plan, pay in lieu of any unused current
year vacation entitlement will be paid to the Executive in a lump sum.









 



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     Benefits under this Plan are paid for entirely by the Company from its general assets.



     This Plan is not a contract of employment, does not guarantee the Executive employment for any
specified period and does not limit the right of the Company to terminate the employment of the
Executive at any time.



     The section headings contained in this Plan are included solely for convenience of reference
and shall not in any way affect the meaning of any provision of this Plan



15. Section 409A




     This Plan is intended to comply with Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”) and will be interpreted in a manner intended to comply with Section 409A of
the Code. Notwithstanding anything herein to the contrary, (i) if at the time of the Executive’s
termination of employment with the Company the Executive is a “specified employee” as defined in
Section 409A of the Code (and any related regulations or other pronouncements thereunder) and the
deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of
such termination of employment is necessary in order to prevent any accelerated or additional tax
under Section 409A of the Code, then the Company will defer the commencement of the payment of any
such payments or benefits hereunder (without any reduction in such payments or benefits ultimately
paid or provided to the Executive) until a date that is six months following the Executive’s
termination of employment with the Company (or the earliest date as is permitted under Section 409A
of the Code), at which point all payments deferred pursuant to this Section 15 shall be paid to the
Executive in a lump sum and (ii) if any other payments of money or other benefits due hereunder
could cause the application of an accelerated or additional tax under Section 409A of the Code,
such payments or other benefits shall be deferred if deferral will make such payment or other
benefits compliant under Section 409A of the Code, or otherwise such payment or other benefits
shall be restructured, to the extent possible, in a manner, determined by the Company, that does
not cause such an accelerated or additional tax. To the extent any reimbursements or in-kind
benefits due under this Plan constitute “deferred compensation” under Section 409A of the Code, any
such reimbursements or in-kind benefits shall be paid in a manner consistent with Treas. Reg.
Section 1.409A-3(i)(1)(iv). Each payment made under this Plan shall be designated as a “separate
payment” within the meaning of Section 409A of the Code. The Company shall consult with Executives
in good faith regarding the implementation of the provisions of this section; provided that neither
the Company nor any of its employees or representatives shall have any liability to Executives with
respect thereto.



16. Adoption Date and Amendments




     This Plan was initially adopted by ITT on December 12, 1989 (“Adoption Date”) and assumed by
ITT Indiana, Inc. (renamed ITT Industries, Inc.) on October 10, 1995 and does not apply to any
termination of employment which occurred or which was communicated to the Executive prior to the
Adoption Date. The Plan was most recently amended effective December 31, 2008.