TEN-2013.6.30-10Q Exhibit 10.6






EXHIBIT 10.6




TENNECO INC. DEFERRED COMPENSATION PLAN
(As Amended and Restated Effective as of August 1, 2013)


		
	1.
	Purpose


The purpose of the Plan is to provide to directors and a select group of management or highly compensated employees of Tenneco Inc. (sometimes referred to as Tenneco) and its subsidiaries and affiliates (hereinafter collectively referred to as the “Company”) an opportunity to defer compensation received by them from the Company in accordance with the terms and conditions set forth herein.  Effective as of December 31, 2004, all deferrals under the Plan were frozen and no new individuals were thereafter eligible to participate in the Plan and no deferrals were thereafter made under the Plan.  The following provisions constitute an amendment, restatement and continuation of the Plan effective as of August 1, 2013 (the “Effective Date”).  The Plan is intended to be grandfathered for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
		
	2.
	Adoption and Administration


The Plan shall be administered by the Compensation / Nominating / Governance Committee of the Board of Directors of the Company (the “Committee”). The Committee shall have the sole and complete authority and discretion to interpret the terms and provisions of the Plan and to adopt, alter and repeal such administrative rules, regulations and practices governing the operation of the Plan, and to determine facts under the Plan as it shall from time to time deem advisable.
		
	3.
	Eligibility


Directors and U.S. paid participants in the Company’s Executive Incentive Compensation Plan shall be eligible to participate in the Plan.  Any person who had an account balance in the Tenneco Inc. Deferred Compensation Plan (or the Deferred Compensation Plan for Directors of Tenneco Inc.) as of the date (the “Distribution Date”) on which the stock of Tenneco Packaging Inc. was distributed to the shareholders of the Company and whose account balance was allocated to the Company under the Human Resources Agreement between the Company and Tenneco Packaging, Inc, (the “Agreement”) shall participate in this Plan.
Persons eligible to participate in the Plan shall be referred to as “Participant” or “Participants” as the case may be.
		
	4.
	Election to Defer


		
	(a)
	A Participant may elect in writing to defer receipt of all or a specified portion of his or her bonuses or incentive compensation to be received during a calendar year (“Deferral Election”); provided, however, that any election by a Participant who is subject to the reporting and short swing profits liability provisions of Section 16 of the Securities and Exchange Act of 1934, as amended, including an election relating to the form of distribution or to defer income into a “Tenneco stock index account” pursuant to Section 6 of the Plan, shall not be effective until such election and the transactions contemplated 



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thereby shall have been specifically approved by the Committee to the extent such approval is required to avoid liability under Section 16 of the Securities and Exchange Act of 1934 and the regulations thereunder. Amounts deferred under the Plan shall be referred to as the “Deferred Amounts.” Once received by the Committee, a Deferral Election cannot be revoked.
		
	(b)
	Prior to the freezing of the Plan effective as of December 31, 2004, Directors who were not employees of the Company (hereinafter referred to as “Outside Directors”) received as part of their compensation for service on the Company’s Board of Directors a portion of their annual retainer fee in the form of credits deferred subject to the terms of this Plan in the Tenneco stock index account with stock settlement.  As of the Effective Date, Participants who received credits to the Tenneco stock index account as an Outside Director may change the investment election pursuant to Section 6.


		
	(c)
	Except as provided in this Section 4(c), a Deferral Election must be made prior to September 30 of the calendar year in which the bonus, incentive compensation or retainer fee will be awarded. A Participant must make a separate Deferral Election with respect to each calendar year of participation in the Plan. A new Participant in the Plan shall have 30 days following his or her notification by the Committee of his or her eligibility to participate in the Plan to make a Deferral Election with respect to bonus or incentive compensation to be awarded within that calendar year.


		
	(d)
	As specified by the Participant in a Deferral Election, the period of deferral shall be until the Participant dies, terminates employment or service with the Company, or until a specific date selected by the Participant in the Deferral Election.


		
	5.
	Establishment of Deferred Compensation Account


At the time of a Participant’s initial Deferral Election, the Company shall establish a memorandum account (a “Deferred Compensation Account”) for such Participant on its books. The Deferred Amount shall be credited to the Participant’s Deferred Compensation Account as of the day on which the Participant would otherwise be entitled to receive the bonus or incentive compensation.  Any required withholding for taxes (e.g. Social Security taxes) on the Deferred Amount shall be made from other compensation of the Participant. Adjustments as provided below, shall be made to the Participant’s Deferred Compensation Account.
		
	6.
	Adjustments to Deferred Amounts


The Committee shall credit the balance of the Participant’s Deferred Compensation Account with an earnings factor. The earnings factor will equal the amount the Participant’s Deferred Compensation Account would have earned if it had been invested in the investment options listed below.  Each Participant, including for periods after the Effective Date, a Participant who received credits to the Tenneco stock index account as an Outside Director, is permitted to select the investment option used to determine the earnings factor and may change the selection at any time. The Participant may choose more than one investment option in increments of at least one (1) percent.  The Company reserves the right to change or amend any of the investment options at any time.
The investment options used to determine the earnings factor are:

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	(a)
	The prime rate of interest as reported by JP Morgan Chase Bank at the first day of each calendar month.


		
	(b)
	Tenneco stock index account — the amount of deferral will be invested in the Tenneco stock equivalent unit account. Any investment in this account will be measured solely by the performance of the Company’s common stock (including dividends that will be reinvested). Amounts credited to this account will be settled either in cash or, if the Company so elects, shares of the Company's common stock and will be offered under the Company's principle equity incentive plan then in effect.


		
	(c)
	The return under certain investment funds chosen by the Company from time to time in its sole discretion, which shall be communicated to the Participants.


The Company is under no obligation to acquire or provide any of the investments designated by a Participant, and any investments actually made by the Company will be made solely in its name and will remain its property.
The crediting of an earnings factor shall occur so long as there is a balance in the Participant’s Deferred Compensation Account regardless of whether the Participant has terminated employment.
		
	7.
	Payment of Deferred Amounts


		
	(a)
	Except as otherwise provided in subsection (b) below, a Participant’s Deferred Amount shall be paid, or commence to be paid, to the Participant, or the Participant’s beneficiary, as soon as practicable after:


(i)    the Participant’s death,
(ii)    the termination of the Participant’s employment or service as a director, or
		
	(iii)
	the date specified in the applicable Deferral Election made by the Participant.


In the event of the Participant’s death, payment of the balance in the Participant’s Deferred Compensation Account shall be made, either (i) in a lump sum or (ii) in a number of annual installments, not to exceed five, as soon as administratively feasible to the Participant’s designated beneficiary, or if none, to the Participant’s estate.
		
	(b)
	The Participant may elect to receive payment of the balance of his or her Deferred Compensation Account either (i) in a lump sum upon termination or (ii) in a single payment at a specified date prior to termination or (iii) in a number of post termination annual installments, not to exceed five, as the Participant shall elect The distribution election must be made at least one year before the Deferred Amount is payable and must be approved by the Committee. If no election is made, a lump sum payment will be made upon the Participant’s termination.


		
	8.
	Participant Reports


The Committee shall provide a statement to the Participant quarterly concerning the status of his or her Deferred Compensation Account.

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	9.
	Transferability of Interests


During the period of deferral, all Deferred Amounts shall be considered as general assets of the Company for use as it deems necessary and shall be subject to the claims of its creditors.
The rights and interests of a Participant during the period of deferral shall be those of a general unsecured creditor except that such Participant’s rights and interests may not be reached by the creditors of the Participant or the Participant’s beneficiary, or anticipated, assigned, pledged, transferred or otherwise encumbered except in the event of the death of the Participant, and then only by will or the laws of descent and distribution.
		
	10.
	Amendment, Suspension and Termination


The Company, at any time, may amend, suspend or terminate the Plan or any portion thereof in such manner and to such extent as it may deem advisable and in its best interests. No amendment, suspension or termination shall reduce the amount then credited to a Participant’s Deferred Compensation Account (other than future adjustments pursuant to Section 6).
		
	11.
	Unfunded Obligation


The Plan shall not be funded; no trust, escrow or other provisions shall be established to secure payments due under the Plan; and the Plan shall be regarded as unfunded for purposes of the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code.  Each Participant shall be treated as a general, unsecured creditor at all times under the Plan, and shall have no rights to any specific assets of the Company.  All amounts credited to the memorandum accounts of the Participants will remain general assets of the Company and shall be payable solely from the general assets of the Company.
		
	12.
	No Right to Employment or Other Benefits


Nothing contained herein shall be construed as conferring upon any Participant the right to continue in the employ of the Company. Any compensation deferred and any payments made under this Plan shall not be included in creditable compensation in computing benefits under any employee benefit plan of the Company except to the extent expressly provided therein.
		
	13.
	Dispute Resolution


By participating in the Plan, each Participant agrees that any dispute arising under the Plan shall be resolved by binding arbitration in Lake Forest, Illinois under the rules of the American Arbitration Association and that there will be no remedy besides the disputed deferred compensation amount in issue.



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