Document:

exv10wxey

 

Exhibit
10-E

FEDERAL SIGNAL CORPORATION

SAVINGS RESTORATION PLAN

(Amended and Restated Effective January 1, 2007)

McDermott Will & Emery LLP

Chicago

 

 

CERTIFICATE

     I,                     ,                                         
of Federal Signal Corporation, hereby certify that the attached document is a correct copy of the Federal Signal Corporation Savings
Restoration Plan (As Amended and Restated Effective January 1, 2007).

     Dated this ___ day of                     , 2006.

	 	 	 	 	 
	 	FEDERAL SIGNAL CORPORATION

 	 
	 	By  	 	 
	 	 	Its 	 	 
	 	 	 	 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	 
	 	 	 	 	 	 
	SECTION 1 INTRODUCTION	 	1
	 
	 	1.1	 	Purpose	 	1
	 
	 	1.2	 	Effective Date; Plan Year	 	1
	 
	 	1.3	 	Plan Administration	 	1
	 
	 	1.4	 	Unfunded Nature of Plan	 	1
	 
	 	 	 	 	 	 
	SECTION 2 DEFINITIONS	 	2
	 
	 	2.1	 	Account	 	2
	 
	 	2.2	 	Accounting Date	 	2
	 
	 	2.3	 	Beneficiary	 	2
	 
	 	2.4	 	Board	 	2
	 
	 	2.5	 	Bonus	 	2
	 
	 	2.6	 	Code	 	2
	 
	 	2.7	 	Committee	 	2
	 
	 	2.8	 	Company	 	2
	 
	 	2.9	 	Company Contributions	 	3
	 
	 	2.10	 	Compensation	 	3
	 
	 	2.11	 	Compensation Deferrals	 	3
	 
	 	2.12	 	Disability	 	3
	 
	 	2.13	 	Effective Date	 	3
	 
	 	2.14	 	Eligible Individual	 	3
	 
	 	2.15	 	Employee	 	3
	 
	 	2.16	 	Employer	 	4
	 
	 	2.17	 	ERISA	 	4
	 
	 	2.18	 	Federal Signal Stock Fund	 	4
	 
	 	2.19	 	Investment Funds	 	4
	 
	 	2.20	 	Matching Contributions	 	4
	 
	 	2.21	 	Participant	 	4
	 
	 	2.22	 	Plan	 	4
	 
	 	2.23	 	Plan Year/Plan Year Quarter	 	4
	 
	 	2.24	 	Spouse	 	5
	 
	 	2.25	 	Termination Date	 	5
	 
	 	2.26	 	Other Definitions	 	5
	 
	 	 	 	 	 	 
	SECTION 3 ELIGIBILITY AND PARTICIPATION	 	6
	 
	 	3.1	 	Eligibility	 	6
	 
	 	3.2	 	Cessation of Participation	 	6
	 
	 	 	 	 	 	 
	SECTION 4 DEFERRALS AND CONTRIBUTIONS	 	7
	 
	 	4.1	 	Compensation Deferrals	 	7
	 
	 	4.2	 	Matching and Company Contributions	 	7
	 
	 	4.3	 	No Election Changes During Plan Year	 	8

 

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	 
	 	 	 	 	 	 
	 
	 	4.4	 	Crediting of Deferrals	 	8
	 
	 	4.5	 	Reduction of Deferrals or Contributions	 	8
	 
	 	 	 	 	 	 
	SECTION 5 NOTIONAL INVESTMENTS	 	9
	 
	 	5.1	 	Investment Funds	 	9
	 
	 	5.2	 	Investment Fund Elections	 	9
	 
	 	5.3	 	Investment Fund Transfers	 	9
	 
	 	 	 	 	 	 
	SECTION 6 ACCOUNTING	 	10
	 
	 	6.1	 	Individual Accounts	 	10
	 
	 	6.2	 	Adjustment of Accounts	 	10
	 
	 	6.3	 	Accounting Methods	 	11
	 
	 	6.4	 	Statement of Account	 	11
	 
	 	 	 	 	 	 
	SECTION 7 VESTING	 	12
	 
	 	 	 	 	 	 
	SECTION 8 FUNDING	 	13
	 
	 	 	 	 	 	 
	SECTION 9 DISTRIBUTION OF ACCOUNTS	 	14
	 
	 	9.1	 	Distribution of Accounts	 	14
	 
	 	9.2	 	6-Month Delay on Payments Due to Termination of Employment	 	15
	 
	 	9.3	 	Mandatory Cash-Outs of Small Amounts	 	15
	 
	 	9.4	 	Designation of Beneficiary	 	15
	 
	 	9.5	 	Reemployment	 	16
	 
	 	9.6	 	Form of Payment	 	16
	 
	 	 	 	 	 	 
	SECTION 10 GENERAL PROVISIONS	 	17
	 
	 	10.1	 	Interests Not Transferable	 	17
	 
	 	10.2	 	Employment Rights	 	17
	 
	 	10.3	 	Litigation by Participants or Other Persons	 	17
	 
	 	10.4	 	Evidence	 	17
	 
	 	10.5	 	Waiver of Notice	 	17
	 
	 	10.6	 	Controlling Law	 	17
	 
	 	10.7	 	Statutory References	 	18
	 
	 	10.8	 	Severability	 	18
	 
	 	10.9	 	Action By the Company, the Employers or the Committee	 	18
	 
	 	10.10	 	Headings and Captions	 	18
	 
	 	10.11	 	Gender and Number	 	18
	 
	 	10.12	 	Examination of Documents	 	18
	 
	 	10.13	 	Elections	 	18
	 
	 	10.14	 	Manner of Delivery	 	19
	 
	 	10.15	 	Facility of Payment	 	19
	 
	 	10.16	 	Missing Persons	 	19

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	 
	 	 	 	 	 	 
	 
	 	10.17	 	Recovery of Benefits	 	20
	 
	 	10.18	 	Effect on Other Benefits	 	20
	 
	 	10.19	 	Tax and Legal Effects	 	20
	 
	 	 	 	 	 	 
	SECTION 11 THE COMMITTEE	 	21
	 
	 	11.1	 	Establishment of Committee	 	21
	 
	 	11.2	 	Committee General Powers, Rights, and Duties	 	21
	 
	 	11.3	 	Interested Committee Member	 	22
	 
	 	11.4	 	Compensation and Expenses	 	22
	 
	 	11.5	 	Information Required by Committee	 	22
	 
	 	11.6	 	Uniform Application of Rules	 	22
	 
	 	11.7	 	Review of Benefit Determinations	 	22
	 
	 	11.8	 	Committee’s Decision Final	 	23
	 
	 	 	 	 	 	 
	SECTION 12 AMENDMENT AND TERMINATION	 	24
	 
	 	 	 	 	 	 
	SUPPLEMENT A	 	 
	 	 	Special Contributions for Stephanie K. Kushner	 	 

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FEDERAL SIGNAL CORPORATION

SAVINGS RESTORATION PLAN

(Amended and Restated Effective January 1, 2007)

SECTION 1 INTRODUCTION

     1.1 Purpose

          Federal Signal Corporation (the “Company”) has established the Federal Signal Corporation
Savings Restoration Plan (the “Plan”), to provide certain supplemental benefits to a select group
of management employees of the Employers under the Plan who contribute materially to the continued
growth, development, and future success of the Employers. The Plan is an amendment and restatement
of the Federal Signal Corporation Supplemental Savings and Investment Plan, which was originally
established effective January 1, 1983. This Plan is intended to comply with the American Jobs
Creation Act of 2004, Code Section 409A, and related guidance. The Plan is intended to constitute
an account balance plan (as defined in IRS Notice 2005-1, Q&A-9).

      1.2 Effective Date; Plan Year

          The Plan is amended and restated effective January 1, 2007. The original effective date of
the Federal Signal Corporation Supplemental Savings and Investment Plan, of which this Plan is a
restatement, was January 1, 1983. The Plan is administered on the basis of a Plan Year, as defined
in subsection 2.24.

      1.3 Plan Administration

          As described in Section 11, the Committee shall be the administrator (as that term is defined
in Section 3(16)(A) of ERISA) of the Plan and shall be responsible for the administration of the
Plan; provided, however, the Committee may delegate all or any part of its powers, rights, and
duties under the Plan to such person or persons as it may deem advisable. Any notice or document
relating to the Plan which is to be filed with the Committee may be delivered, or mailed by
registered or certified mail, postage pre-paid, to the secretary of the Committee, or to any
designated Committee representative, in care of the Company, at its principal office.

      1.4 Unfunded Nature of Plan

          The Plan is an unfunded, nonqualified deferred compensation plan that is intended to qualify
for the exemptions provided in Sections 201, 301, and 401 of ERISA. Participants (and their
Beneficiaries) shall have only those rights to payments as set forth in the Plan and shall be
considered general, unsecured creditors of the Employers with respect to any such rights.

 

 

SECTION 2 DEFINITIONS

      2.1 Account

          “Account” means all notional accounts and sub-accounts maintained for a Participant in order
to reflect his interest under the Plan, as described in Section 6.

      2.2 Accounting Date

          “Accounting Date” means each day designated by the Committee as of which the value of an
Investment Fund is adjusted for notional deferrals, contributions, distributions, gains, losses, or
expenses. To the extent not otherwise designated by the Committee, each Investment Fund will be
valued as of each day on which the New York Stock Exchange is open for trading.

      2.3 Beneficiary

          “Beneficiary” means the person or persons to whom a deceased Participant’s benefits are
payable under subsection 9.4.

      2.4 Board

          “Board” means the Board of Directors of the Company, as from time to time constituted.

      2.5 Bonus

          “Bonus” means an incentive award of cash contingent upon the achievement of specified
performance goals and payable to an Employee in a given year, with respect to the immediately
preceding incentive bonus performance period.

      2.6 Code

          “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific section
of the Code shall include such section, any valid regulation promulgated thereunder, and any
comparable provision of any future legislation amending, supplementing, or superseding such
section.

      2.7 Committee

          “Committee” means the Benefits Planning Committee of the Company, as described in Section 11.

      2.8 Company

          “Company” means Federal Signal Corporation or any successor organization or entity that
assumes the Plan.

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      2.9 Company Contributions

          “Company Contributions” means the amounts credited to a Participant’s Company Contribution
Account under the Plan by the Employer, in accordance with subsection 4.2.

      2.10 Compensation

          “Compensation” means Compensation as defined in the Federal Signal Retirement Savings Plan
(the “Qualified RSP Plan”), which term shall include (but shall not be limited to) salary, bonus,
and commissions; provided, however, that Compensation shall be determined for these purposes
without regard to the dollar limitations in effect for qualified plans under Section 401(a)(17) of
the Code.

      2.11 Compensation Deferrals

          “Compensation Deferrals” means the amounts credited to a Participant’s Compensation Deferral
Account pursuant to the Participant’s election made in accordance with subsection 4.1.

      2.12 Disability

          “Disability” means the occurrence of an event as a result of which a Participant is considered
disabled. A Participant is considered disabled if the Participant is determined to be disabled in
accordance with a disability insurance program maintained or contributed to by the Employer by
reason of any medically determinable physical or mental impairment which can be expected to result
in death or can be expected to last for a continuous period of at least 12 months.

      2.13 Effective Date

          “Effective Date” means January 1, 2007.

      2.14 Eligible Individual

          “Eligible Individual” means each Employee of an Employer who satisfies the requirements set
forth in Section 3.

      2.15 Employee

          “Employee” means a person who is employed by an Employer, is on the Employer’s regular
payroll, and is treated and/or classified by the Employer as a common law employee for purposes of
wage withholding for Federal income taxes. If a person is not considered to be an Employee of the
Employer in accordance with the preceding sentence, a subsequent determination by the Employer, any
governmental agency, or a court that the person is a common law employee of the Employer, even if
such determination is applicable to prior years, will not have a retroactive effect for purposes of
eligibility to participate in the Plan.

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      2.16 Employer

          “Employer” means Federal Signal Corporation and any affiliate or subsidiary of the Company as
defined in Subsections 414(b) and (c) of the Code that has adopted the Plan on behalf of its
Eligible Individuals with the consent of the Company.

      2.17 ERISA

          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. Reference to a
specific section of ERISA shall include such section, any valid regulation promulgated thereunder,
and any comparable provision of any future legislation amending, supplementing, or superseding such
section.

      2.18 Federal Signal Stock Fund

          “Federal Signal Stock Fund” means an Investment Fund offered under the Plan having a notional
investment return based on the performance of the common stock of the Company, in accordance with
rules and procedures established by the Committee.

      2.19 Investment Funds

          “Investment Funds” means the notional funds or other investment vehicles designated pursuant
to subsection 5.1.

      2.20 Matching Contributions

          “Matching Contributions” means the amounts credited to a Participant’s Matching Contribution
Account under the Plan by the Employer, in accordance with subsection 4.2.

      2.21 Participant

          “Participant” means an Eligible Individual who meets the requirements of Section 3 and elects
to make Compensation Deferrals pursuant to Section 4, or any individual who is an Employee or
former Employee of an Employer who has an Account under this Plan, or a non-Employee member or
former member of the Board of Directors of the Company, who has a Pre-2007 Plan Account under the
Plan.

      2.22 Plan

          “Plan” means the Federal Signal Corporation Savings Restoration Plan, as set forth in this
instrument and as hereafter amended from time to time.

      2.23 Plan Year/Plan Year Quarter

          “Plan Year” means each 12-month period beginning January 1 and ending the following December
31. “Plan Year Quarter” means each three-month period ending March 31, June 30, September 30 and
December 31.

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      2.24 Spouse

          “Spouse” means the person to whom a Participant is legally married under applicable state law
at the earlier of the date of the Participant’s death or the date payment of the Participant’s
benefits commenced and who is living on the date of the Participant’s death.

      2.25 Termination Date

          “Termination Date” means, with respect to an Employee, the date on which the Participant has a
separation from service with the Employers, the Company and any subsidiary or affiliate of the
Company, as determined by the Committee.

      2.26 Other Definitions

          Other defined terms used in the Plan shall have the meanings given such terms elsewhere in the
Plan.

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SECTION 3 ELIGIBILITY AND PARTICIPATION

      3.1 Eligibility

          For each Plan Year commencing on or after 2007, each Employee of an Employer who is employed
at a salary grade of 18 or above (as determined by the Committee) shall be an Eligible Individual
eligible to participate in the Plan by making a deferral election pursuant to Section 4.
Notwithstanding the foregoing, an Employee who is employed at a salary grade lower than 18 may be
determined by the Committee to be an Eligible Individual if the Committee determines that his
Compensation is at a level such that he is likely to be, on a sustained basis, subject to the
limitations on Compensation that can be taken into account under the Qualified RSP Plan, as
described in Section 4 below. An Employee who first becomes employed at a salary grade of 18 or
above during a Plan Year (or is otherwise determined by the Committee to be an Eligible Individual)
shall only be permitted to become a Participant in the Plan as of the January 1 following the date
he becomes an Eligible Individual. A list of all potential Eligible Individuals shall be presented
to the Committee annually for approval.

          Each Eligible Individual’s decision to become a Participant shall be entirely voluntary. An
Eligible Individual who makes a deferral election pursuant to Section 4, or who has an Account
balance under the Plan, shall be a Participant in the Plan.

      3.2 Cessation of Participation

          If a Participant ceases to be an Eligible Individual, no further Compensation Deferrals, Company Contributions or Matching Contributions shall be credited to the Participant’s Accounts
after the end of the Plan Year Quarter following the date the Participant ceases to be eligible or
as soon as administratively feasible thereafter (or, if the eligibility determination can be made
by the Committee or its designee prior to the end of the Plan Year Quarter, on or as soon as
administratively feasible after the date the Participant ceases to be eligible), unless he is again
determined to be an Eligible Individual, but the balance credited to his Accounts shall continue to
be adjusted for notional investment gains and losses under the terms of the Plan and shall be
distributed to him at the time and manner set forth in Section 9. An Employee shall cease to be a
Participant after his Termination Date or other loss of eligibility as soon as his entire Account
balance has been distributed.

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SECTION 4 DEFERRALS AND CONTRIBUTIONS

      4.1 Compensation Deferrals

          Each Plan Year, an Eligible Individual may elect to defer receipt (in increments of one
percent) of no less than 6 percent but no greater than 40 percent (or such other percentage as
determined by the Committee) of his Compensation that would otherwise have been payable to him on
or after the effective date of the election, but only to the extent that the Participant’s
deferrals under the Qualified RSP Plan have been limited by the restrictions on deferrals to the
Qualified RSP Plan imposed by Section 402(g) of the Code, or by the limitations on Compensation
that can be taken into account under the Qualified RSP Plan imposed by Section 401(a)(17) of the
Code. A Participant’s deferral election for a Plan Year under this subsection must be made not
later than December 31 of the preceding Plan Year with respect to Compensation payable on or after
the following January 1 in accordance with rules established by the Committee.

          Except as provided in subsection 4.3, an election to make Compensation Deferrals under this
subsection 4.1 shall be irrevocable and shall remain in effect for Compensation otherwise payable
during the calendar year to which the election applies (or, in the case of deferrals of
Compensation consisting of Bonus, shall remain in effect for the Bonus otherwise payable during the
second calendar year following the December 31 election date described above).

      4.2 Matching and Company Contributions

          Matching Contributions shall be credited to the Matching Contribution Accounts of Participants
who have satisfied the requirements of subsection 3.1 and in accordance with the requirements of
this subsection 4.2. The amount of any such Matching Contribution with respect to a Participant
shall be equal to 50% of 6% of the amount of the Participant’s Compensation, but reduced by the
amount of Matching Contributions made to the Qualified RSP Plan on the Participant’s behalf for the
applicable Plan Year. Matching Contributions under this Plan shall be credited to such
Participants’ Matching Contribution Accounts at the same time as Matching Contributions are
credited to Participants’ Accounts under the Qualified RSP Plan.

          Company Contributions shall be credited to the Company Contribution Accounts of Participants
who have satisfied the requirements of subsection 3.1 and in accordance with the requirements of
this subsection 4.2. The amount of any such Company Contributions with respect to a Participant
shall be equal to the amount of Points-Weighted Contributions that would have been made under the
Qualified RSP Plan on the Participant’s behalf without regard to the limits on the Participant’s
Compensation under Section 401(a)(17) of the Code, but reduced by the amount of Points-Weighted
Contributions that were made to the Qualified RSP Plan on the Participant’s behalf for the
applicable Plan Year. Company Contributions under this Plan shall be credited to such
Participants’ Company Contribution Accounts at the same time as Points-Weighted Contributions are
credited to Participants’ Accounts under the Qualified RSP Plan. Additional discretionary Company
Contributions may be made to the Participant’s Company Contribution Account, in the Company’s sole
discretion and subject to such rules and procedures as the Committee may establish.

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      4.3 No Election Changes During Plan Year

          A Participant shall not be permitted to change or revoke his deferral elections, except that,
if a Participant’s status changes such that he becomes ineligible for the Plan, the Participant’s
deferrals under the Plan shall cease as described in subsection 3.2.

      4.4 Crediting of Deferrals

          The amount of deferrals pursuant to subsection 4.1 shall be credited to the Participant’s
Accounts as of a date not later than 15 business days after the date on which the amount (but for
the deferral) otherwise would have been paid to the Participant.

      4.5 Reduction of Deferrals or Contributions

          Any deferrals or contributions to be credited to a Participant’s Account under this Section
may be reduced by an amount equal to the Federal or state income, payroll, or other taxes required
to be withheld on such deferrals or contributions or to satisfy any necessary employee welfare plan
contributions. A Participant shall be entitled only to the net amount of such deferral or
contribution (as adjusted from time to time pursuant to the terms of the Plan).

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SECTION 5 NOTIONAL INVESTMENTS

      5.1 Investment Funds

          The Committee may designate, in its discretion, one or more Investment Funds for the notional
investment of Participants’ Accounts. The Committee, in its discretion, may from time to time
establish new Investment Funds or eliminate existing Investment Funds. An Investment Fund will be
offered that consists of a notional investment in a Federal Signal Stock Fund, as defined in
subsection 2.19. The Investment Funds are for recordkeeping purposes only and do not allow
Participants to direct any Company assets (including, if applicable, the assets of any trust
related to the Plan). Each Participant’s Accounts shall be adjusted pursuant to the Participant’s
notional investment elections made in accordance with this Section 5, except as otherwise
determined by the Committee in its sole discretion.

      5.2 Investment Fund Elections

          A Participant may elect from among the Investment Funds for the notional investment of his
Accounts from time to time in accordance with procedures established by the Committee. The
Committee, in its discretion, may adopt (and may modify from time to time) such rules and
procedures as it deems necessary or appropriate to implement the notional investment of the
Participant’s Accounts. Such procedures may differ among Participants or classes of Participants,
as determined by the Committee in its discretion. The Committee may limit, delay or restrict the
notional investment of certain Participants’ Accounts in accordance with Committee rules in order
to comply with Company policy and applicable law or to minimize regulated filings and disclosures.
Any deferred amounts subject to a Participant’s investment election that must be so limited,
delayed or restricted under such circumstances may be notionally invested in an Investment Fund
designated by the Committee, or may be credited with earnings at a rate determined by the
Committee, which rate may be zero. A Participant’s notional investment election shall remain in
effect until later changed in accordance with the rules of the Committee. If a Participant does
not make a notional investment election, all deferrals by the Participant and contributions on his
behalf will be deemed to be notionally invested in the Investment Fund designated by the Committee
for such purpose.

      5.3 Investment Fund Transfers

          A Participant may elect that all or a part of his notional interest in an Investment Fund
shall be transferred to one or more of the other Investment Funds. A Participant may make such
notional Investment Fund transfers in accordance with rules established from time to time by the
Committee, and in accordance with subsection 5.2. Notwithstanding the foregoing, any amount of a
Participant’s Pre-2007 Plan Account that has been invested in the Federal Signal Stock Fund may not
be transferred to any of the other Investment Funds.

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SECTION 6 ACCOUNTING

      6.1 Individual Accounts

          The Committee may, in its discretion, maintain in the name of each Participant, as applicable,
the following Accounts, and any sub-accounts under such Accounts deemed necessary or advisable by
the Committee from time to time:

	 	(a)	 	Compensation Deferral Account. A Compensation Deferral Account to reflect the
Participant’s Compensation Deferrals and the notional gains, losses, expenses,
appreciation and depreciation attributable thereto.
	 
	 	(b)	 	Matching Contribution Account. A Matching Contribution Account to reflect the
Matching Contributions credited on behalf of the Participant, if applicable, and the
notional gains, losses, expenses, appreciation and depreciation attributable thereto.
	 
	 	(c)	 	Company Contribution Account. A Company Contribution Account to reflect the
Company Contributions credited on behalf of the Participant, if applicable, and the
notional gains, losses, expenses, appreciation and depreciation attributable thereto.
	 
	 	(d)	 	Pre-2007 Plan Account. A Pre-2007 Plan Account to reflect the amounts, if any,
credited on behalf of the Participant under the Plan prior to January 1, 2007, and the
notional gains, losses, expenses, appreciation and depreciation attributable thereto.
Amounts in the Participant’s Pre-2007 Plan Account shall always be notionally invested
in the Federal Signal Corporation Stock Fund. Notwithstanding the foregoing, a
Participant’s Pre-2007 Plan Account may also contain a Pre-1998 Sub-account, which
shall not be notionally invested in the Federal Signal Corporation Stock Fund, but
which instead shall be notionally credited with a fixed interest rate based upon the
Vanguard Retirement Savings Trust rate, or such other rate or benchmark as the
Committee shall determine from time to time in its discretion.

The Committee may establish such rules and procedures relating to the maintenance, adjustment, and
liquidation of Participants’ Accounts, the crediting of deferrals and contributions and the
notional gains, losses, expenses, appreciation, and depreciation attributable thereto, as it
considers necessary or advisable. In addition to the Accounts described above, the Committee may
maintain other Accounts or sub-accounts in the names of Participants or otherwise as the Committee
considers necessary or desirable.

      6.2 Adjustment of Accounts

          Pursuant to rules established by the Committee and applied on a uniform basis, Participants’
Accounts will be adjusted on each Accounting Date, except as provided in Section 9, to reflect the
value of the various Investment Funds as of such date, including adjustments to

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reflect any deferrals and contributions, notional transfers between Investment Funds, and
notional gains, losses, expenses, appreciation, or depreciation with respect to such Accounts since
the previous Accounting Date. The “value” of an Investment Fund at any Accounting Date shall be
based on the fair market value of the Investment Fund, as determined by the Committee.

      6.3 Accounting Methods

          The accounting methods or formulae to be used under the Plan for purposes of monitoring
Participants’ Accounts, including the calculation and crediting of notional gains, losses,
expenses, appreciation, or depreciation, shall be determined by the Committee in its sole
discretion. The accounting methods or formulae selected by the Committee may be revised from time
to time.

      6.4 Statement of Account

          At such times and in such manner as determined by the Committee, but at least annually, each
Participant will be furnished with a statement reflecting the condition of his Accounts.

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SECTION 7 VESTING

          A Participant shall be fully vested at all times in his Compensation Deferral Account and his
Pre-2007 Plan Account. A Participant’s Matching Contribution Account and Company Contribution
Account shall be vested at the same time and in the same manner as the Participant’s Matching
Contributions and Points-Weighted Contributions are vested under the Qualified RSP Plan.
Notwithstanding the foregoing, a Participant or his Beneficiary shall have no right to amounts
credited to his Matching Contributions Account and Company Contributions Account if the Committee,
the Company or the Employer determines that he engaged in any willful, deliberate or gross act of
commission or omission which is substantially injurious to the finances or reputation of the
Company or any Employer.

          Neither the Committee nor the Employers in any way guarantee the Participant’s Account balance
from loss or depreciation. Notwithstanding any provision of the Plan to the contrary, the
Participant’s Account balance is subject to Section 8.

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SECTION 8 FUNDING

          No Participant or other person shall acquire by reason of the Plan any right in or title to
any assets, funds, or property of the Employers whatsoever, including, without limiting the
generality of the foregoing, any specific funds, assets, or other property of the Employers.
Benefits under the Plan are unfunded and unsecured. A Participant shall have only an unfunded,
unsecured right to the amounts, if any, payable hereunder to that Participant. The Employers’
obligations under this Plan are not secured or funded in any manner, even if the Company elects to
establish a trust with respect to the Plan. Even though benefits provided under the Plan are not
funded, the Company may establish a trust to assist in the payment of benefits. All investments
under this Plan are notional and do not obligate the Employers (or their delegatees) to invest the
assets of the Employers or of any such trust in a similar manner.

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SECTION 9 DISTRIBUTION OF ACCOUNTS

     9.1 Distribution of Accounts

          A Participant may elect to receive payment of his Accounts at his Termination of Employment
(subject to subsection 9.2) in the form of a single lump sum or in annual installments for 5, 10,
or 15 years. The Participant may elect each year to have all amounts attributable to the
Compensation Deferrals, Matching Contributions and Company Contributions, made to the Plan on his
behalf for that Plan Year, and the earnings thereon, paid in the form of either a single lump sum
or installments. The Participant’s distribution election with respect to amounts credited to his
Accounts for such Plan Year, and the earnings thereon, must apply to all Accounts for such Plan
Year. The Participant may make a separate distribution election with respect to each Plan Year.
To the extent a Participant fails to make an election, the Participant shall be deemed to have
elected to receive his distribution for that Plan Year in the form of a single lump sum.
Notwithstanding the foregoing, in the event of the Participant’s death, the Participant’s total
Account balances shall be distributed in the form of a lump sum to the Participant’s Beneficiary as
determined under subsection 9.4. A Participant’s total Pre-2007 Plan Account shall be paid to him
in the form of a single lump sum (or, if applicable, in the form of installments pursuant to his
election made prior to January 1, 2005 with respect to such Pre-2007 Plan Account) upon his
Termination Date (or such later date as shall be required under subsection 9.2).

	 	(a)	 	Elections. A Participant will be required to make his distribution
election prior to the commencement of each Plan Year.
	 
	 	(b)	 	Installment Payments. The first installment payment shall be made in
the month of January following the calendar year in which occurs the Participant’s
Termination Date, or such later date as shall be administratively feasible for the
Committee to make such payment and in accordance with subsection 9.2. Succeeding
payments shall be made in January of each succeeding calendar year, or as soon as
administratively feasible for the Committee to make such payment. The amount to be
distributed in each installment payment shall be determined by dividing the value of
the Participant’s Accounts as of an Accounting Date preceding the date of each
distribution by the number of installment payments remaining to be made, in accordance
with rules established by the Committee.
	 
	 	(c)	 	Subsequent Elections to Change Form of Payment. Participants may make
a subsequent election to change the form of payment from installments to a lump sum or
vice versa, and a separate election change shall be allowed with respect to the amounts
in the Participants’ Accounts attributable to each Plan Year. Provided, however, that
such election change will be allowed only once in a Participant’s period of
participation in the Plan, and such election change shall only be permitted with the
approval of the Committee in its sole discretion and in accordance with procedures
established by the Committee. Any such election change shall not take effect until the
Participant has completed 12 months of employment with the Employer following the date
of such election change, and

-14-

 

	 	 	 	payments subject to such change may not commence earlier than five years following
the date payments would otherwise have commenced.
	 
	 	(d)	 	Disability Election. Notwithstanding the foregoing, a Participant may
elect, as of the first year in which the Participant becomes an Participant, to have
the remainder of his Accounts under the Plan paid out in a lump sum immediately
following his Disability (as defined in subsection 2.13), regardless of whether he has
incurred a Termination Date or whether his Accounts have commenced distribution under
the Plan as of such date.

     9.2 6-Month Delay on Payments Due to Termination of Employment

          Notwithstanding anything herein to the contrary, payment shall not be made or commence as a
result of the Participant’s Termination Date to any Participant before the date that is not less
than six months after the Participant’s Termination Date.

     9.3 Mandatory Cash-Outs of Small Amounts

          If the value of a Participant’s total Accounts equals $10,000 or less at his Termination Date
(or his death), the Accounts will be paid to the Participant (or, in the event of his death, his
Beneficiary) in a single lump sum, subject to subsection 9.2, notwithstanding any election by the
Participant otherwise.

     9.4 Designation of Beneficiary

          Each Participant from time to time may designate any individual, trust, charity or other
person or persons to whom the value of the Participant’s Accounts will be paid in the event the
Participant dies before receiving the value of all of his Accounts. A Beneficiary designation must
be made in the manner required by the Committee for this purpose. Primary and secondary
Beneficiaries are permitted. Payments to the Participant’s Beneficiary(ies) shall be made after
the Committee has received proper notification of the Participant’s death.

          A Beneficiary designation will be effective only when the Beneficiary designation is filed
with the Committee while the Participant is alive, and a subsequent Beneficiary designation will
cancel all of the Participant’s Beneficiary designations previously filed with the Committee. Any
designation or revocation of a Beneficiary shall be effective as only if it is received by the
Committee. Once received, such designation shall be effective as of the date the designation was
executed, but without prejudice to the Committee on account of any payment made before the change
is recorded by the Committee. If a Beneficiary dies before payment of the Participant’s Accounts
have been made, the Participant’s Accounts shall be distributed in accordance with the
Participant’s Beneficiary designation and pursuant to rules established by the Committee. If a
deceased Participant failed to designate a Beneficiary, or if the designated Beneficiary
predeceases the Participant, the value of the Participant’s Accounts shall be payable to the
Participant’s Spouse or, if there is none, to the Participant’s estate, or in accordance with such
other equitable procedures as determined by the Committee.

-15-

 

     9.5 Reemployment

          If a former Participant is rehired by an Employer, the Company or any affiliate or subsidiary
of the Company described in Section 414(b) and (c) of the Code, regardless of whether he is rehired
as an Eligible Individual, any payments being made to such Participant hereunder by virtue of his
previous Termination Date shall cease. Upon such Participant’s subsequent Termination Date, his
payments shall again commence in the form previously elected by such Participant in accordance with
this Section 9. If a former Participant is rehired by the Employer, and any payments to be made to
the Participant by virtue of his previous Termination Date have not been made or commenced, such
Participant shall no longer be entitled to such payments until his subsequent Termination Date.

     9.6 Form of Payment

          Amounts in a Participant’s Pre-2007 Plan Accounts shall be distributed only in the form of
Federal Signal Corporation common stock. Amounts in a Participant’s other Accounts under the Plan
invested at the Participant’s direction in the notional Investment Funds shall be distributed to
the Participant in cash.

-16-

 

SECTION 10 GENERAL PROVISIONS

     10.1 Interests Not Transferable

          The interests of persons entitled to benefits under the Plan are not subject to their debts or
other obligations and, except as may be required by the tax withholding provisions of the Code or
any state’s income tax act, may not be voluntarily or involuntarily sold, transferred, alienated,
assigned, or encumbered. A Participant’s interest in the Plan is not transferable pursuant to a
qualified domestic relations order.

     10.2 Employment Rights

          The Plan does not constitute a contract of employment, and participation in the Plan shall not
give any Employee the right to be retained in the employ of an Employer, nor any right or claim to
any benefit under the Plan, unless such right or claim has specifically accrued under the terms of
the Plan. The Employers expressly reserve the right to discharge any Employee at any time.

     10.3 Litigation by Participants or Other Persons

          If a legal action begun against the Committee (or any member or former member thereof), an
Employer, or any person or persons to whom an Employer or the Committee has delegated all or part
of its duties hereunder, by or on behalf of any person results adversely to that person, or if a
legal action arises because of conflicting claims to a Participant’s or other person’s benefits,
the cost to the Committee (or any member or former member thereof), the Employers or any person or
persons to whom the Employer or the Committee has delegated all or part of its duties hereunder of
defending the action shall be charged to the extent permitted by law to the sums, if any, which
were involved in the action or were payable to the Participant or other person concerned.

     10.4 Evidence

          Evidence required of anyone under the Plan may be by certificate, affidavit, document, or
other information which the person acting on it considers pertinent and reliable, and signed, made,
or presented by the proper party or parties.

     10.5 Waiver of Notice

          Any notice required under the Plan may be waived by the person entitled to such notice.

     10.6 Controlling Law

          Except to the extent superseded by laws of the United States, the laws of the State of
Illinois shall be controlling in all matters relating to the Plan.

-17-

 

     10.7 Statutory References

          Any reference in the Plan to a Code section or a section of ERISA, or to a section of any
other Federal law, shall include any comparable section or sections of any future legislation that
amends, supplements, or supersedes that section.

     10.8 Severability

          In case any provision of the Plan shall be held illegal or invalid for any reason, such
illegality or invalidity shall not affect the remaining provisions of the Plan, and the Plan shall
be construed and enforced as if such illegal and invalid provision had never been set forth in the
Plan.

     10.9 Action By the Company, the Employers or the Committee

          Any action required or permitted to be taken by the Company or any of the Employers under the
Plan shall be by resolution of its board of directors, by resolution or other action of a duly
authorized committee of its board of directors, or by action of a person or persons authorized by
resolution of its board of directors or such committee. Any action required or permitted to be
taken by the Committee under the Plan shall be by resolution or other action of the Committee or by
a person or persons duly authorized by the Committee.

     10.10 Headings and Captions

          The headings and captions contained in this Plan are inserted only as a matter of convenience
and for reference, and in no way define, limit, enlarge, or describe the scope or intent of the
Plan, nor in any way shall affect the construction of any provision of the Plan.

     10.11 Gender and Number

          Where the context permits, words in the masculine gender shall include the feminine and neuter
genders, the singular shall include the plural, and the plural shall include the singular.

     10.12 Examination of Documents

          Copies of the Plan and any amendments thereto are on file at the office of the Company where
they may be examined by any Participant or other person entitled to benefits under the Plan during
normal business hours.

     10.13 Elections

          Each election or request required or permitted to be made by a Participant (or a Participant’s
Spouse or Beneficiary) shall be made in accordance with the rules and procedures established by the
Committee and shall be effective as determined by the Committee. The Committee’s rules and
procedures may address, among other things, the method and timing of any elections or requests
required or permitted to be made by a Participant (or a Participant’s Spouse or Beneficiary).

-18-

 

     10.14 Manner of Delivery

          Each notice or statement provided to a Participant shall be delivered in any manner
established by the Committee and in accordance with applicable law, including, but not limited to,
electronic delivery.

     10.15 Facility of Payment

          When a person entitled to benefits under the Plan is a minor, under legal disability, or, in
the Committee’s opinion, is in any way incapacitated so as to be unable to manage his financial
affairs, the Committee may cause the benefits to be paid to such person’s guardian or legal
representative. If no guardian or legal representative has been appointed, or if the Committee so
determines in its sole discretion, payment may be made to any person as custodian for such
individual under applicable state law, or to the legal representative of such person for such
person’s benefit, or the Committee may direct the application of such benefits for the benefit of
such person. Any payment made in accordance with the preceding sentence shall be a full and
complete discharge of any liability for such payment under the Plan.

     10.16 Missing Persons

          The Employers and the Committee shall not be required to search for or locate a Participant,
Spouse, or Beneficiary. Each Participant, Spouse, and Beneficiary must file with the Committee,
from time to time, in writing the Participant’s, Spouse’s, or Beneficiary’s post office address and
each change of post office address. Any communication, statement, or notice addressed to a
Participant, Spouse, or Beneficiary at the last post office address filed with the Committee, or if
no address is filed with the Committee, then in the case of a Participant, at the Participant’s
last post office address as shown on the Employer’s records, shall be considered a notification for
purposes of the Plan and shall be binding on the Participant and the Participant’s Spouse and
Beneficiary for all purposes of the Plan.

          If the Committee is unable to locate the Participant, Spouse, or Beneficiary to whom a
Participant’s Accounts are payable, the Participant’s Accounts shall be frozen as of the date on
which distribution would have been completed under the terms of the Plan, and no further notional
investment returns shall be credited thereto.

          If a Participant whose Accounts were frozen (or his Beneficiary) files a claim for
distribution of the Accounts within 7 years after the date the Accounts are frozen, and if the
Committee determines that such claim is valid, then the frozen balance shall be paid by the Company
to the Participant or Beneficiary in a lump sum cash payment as soon as practicable thereafter. If
the Committee notifies a Participant, Spouse, or Beneficiary of the provisions of this Subsection,
and the Participant, Spouse, or Beneficiary fails to claim the Participant’s, Spouse’s, or
Beneficiary’s benefits or make such person’s whereabouts known to the Committee within 7 years
after the date the Accounts are frozen, the benefits of the Participant, Spouse, or Beneficiary may
be disposed of, to the extent permitted by applicable law, by one or more of the following methods:

-19-

 

	 	(a)	 	By retaining such benefits in the Plan.
	 
	 	(b)	 	By paying such benefits to a court of competent jurisdiction for judicial
determination of the right thereto.
	 
	 	(c)	 	By forfeiting such benefits in accordance with procedures established by the
Committee. If a Participant, Spouse, or Beneficiary is subsequently located, such
benefits shall be restored (without adjustment) to the Participant, Spouse, or
Beneficiary under the Plan.
	 
	 	(d)	 	By any equitable manner permitted by law under rules adopted by the Committee.

     10.17 Recovery of Benefits

          In the event a Participant, Spouse, or Beneficiary receives a benefit payment from the Plan
that is in excess of the benefit payment that should have been made to such Participant, Spouse, or
Beneficiary, or in the event a person other than a Participant, Spouse, or Beneficiary receives an
erroneous payment from the Plan, the Committee shall have the right, on behalf of the Plan, to
recover the amount of the excess or erroneous payment from the recipient. To the extent permitted
under applicable law, the Committee may, at its option, deduct the amount of such excess or
erroneous payment from any future benefits payable to the applicable Participant, Spouse, or
Beneficiary.

     10.18 Effect on Other Benefits

          Except as otherwise specifically provided under the terms of any other employee benefit plan
of the Company, a Participant’s participation in this Plan shall not affect the benefits provided
under such other employee benefit plan.

     10.19 Tax and Legal Effects

          The Employers, the Committee, and their representatives and delegatees do not in any way
guarantee the tax treatment of benefits for any Participant, Spouse, or Beneficiary, and the
Employers, the Committee, and their representatives and delegatees do not in any way guarantee or
assume any responsibility or liability for the legal, tax, or other implications or effects of the
Plan. In the event of any legal, tax, or other change that may affect the Plan, the Company may,
in its sole discretion, take any actions it deems necessary or desirable as a result of such
change.

-20-

 

SECTION 11 THE COMMITTEE

     11.1 Establishment of Committee

          The Plan shall be administered by a Committee established by the Company, which as of the
Effective Date shall be the Benefits Planning Committee or any successor thereto.

     11.2 Committee General Powers, Rights, and Duties

          Except as otherwise specifically provided herein, and in addition to the powers, rights, and
duties specifically given to the Committee elsewhere in the Plan or otherwise delegated to the
Committee by the Company, the Committee shall have the following powers, rights, and duties, which
shall be exercisable in the sole discretion of the Committee:

	 	(a)	 	To adopt such rules, procedures, and regulations as in its opinion may be
necessary for the proper and efficient administration of the Plan and as are consistent
with the Plan and to change, alter, or amend such rules, procedures, and regulations;
	 
	 	(b)	 	To construe and interpret the provisions of the Plan and make factual
determinations thereunder;
	 
	 	(c)	 	To determine all questions arising in the administration of the Plan, including
the power to determine the rights or eligibility of Employees or Participants or any
other persons, and the amounts of their benefits (if any) under the Plan, and to remedy
ambiguities, inconsistencies, or omissions, and any such determination shall be binding
on all parties;
	 
	 	(d)	 	To employ and suitably compensate such agents, attorneys, accountants,
actuaries, recordkeepers, or other persons (who also may be employed by the Company) to
render advice and perform other services as the Committee may deem necessary to carry
out its powers, rights, and duties;
	 
	 	(e)	 	To the extent applicable, to direct payments or distributions in accordance
with the provisions of the Plan;
	 
	 	(f)	 	To furnish the Employers with such information as may be required by them for
tax or other purposes in connection with the Plan;
	 
	 	(g)	 	To communicate the Plan and its requirements to Participants;
	 
	 	(h)	 	To take such actions as the Committee may deem necessary or advisable to
correct any errors in the operation of the Plan; and
	 
	 	(i)	 	To take such other actions as the Committee may deem necessary for the proper
administration and operation of the Plan in accordance with its terms.

-21-

 

     11.3 Interested Committee Member

          No member of the Committee who is also an Employee of an Employer shall be excluded from
participating in the Plan if otherwise eligible. If a member of the Committee (or one of its
delegatees or designees) also is a Participant in the Plan, he may not decide or determine any
matter or question concerning distributions of any kind to be made to him or her or the nature or
mode of settlement of his benefits unless such decision or determination could be made by him or
her under the Plan if he were not serving on the Committee.

     11.4 Compensation and Expenses

          Unless paid by an Employer, all reasonable costs, charges, and expenses incurred in the
administration of this Plan, including expenses incurred by the Committee, compensation to an
investment manager, and any compensation to agents, attorneys, actuaries, accountants,
recordkeepers, and other persons performing services on behalf of this Plan or for the Committee,
may be drawn from (a) Participants’ Accounts, in the form of a flat fee or a percentage of the
value of each Account, (b) notional earnings or gains in each Investment Fund, or (c) an account
maintained under a trust related to the Plan (if any).

     11.5 Information Required by Committee

          Each person entitled to benefits under the Plan must file with the Committee from time to time
in writing such person’s mailing address and each change of mailing address. Any communication,
statement, or notice addressed to any person at the last mailing address filed with the Committee
will be binding upon such person for all purposes of the Plan. Each person entitled to benefits
under the Plan also shall furnish the Committee with such documents, evidence, data, or information
as the Committee considers necessary or desirable for the purposes of administering the Plan. The
Employers shall furnish the Committee with such data and information as the Committee may deem
necessary or desirable in order to administer the Plan. The records of the Employers as to an
Employee’s or Participant’s period of employment, termination of employment and the reason
therefor, leave of absence, reemployment, and Compensation will be conclusive on all persons unless
determined to the Committee’s satisfaction to be incorrect.

     11.6 Uniform Application of Rules

          The Committee shall administer the Plan on a reasonable basis. Any rules, procedures, or
regulations established by the Committee shall be applied uniformly to all persons similarly
situated.

     11.7 Review of Benefit Determinations

          Claims for benefits under the Plan shall be administered in accordance with Section 503 of
ERISA, the regulations thereunder, and such reasonable claims procedures as may be established by
the Committee. The Plan shall provide adequate notice to any Participant, Spouse, Beneficiary, or
other claimant whose claim for benefits under the Plan has been denied,

-22-

 

setting forth the reasons for such denial, and shall afford such claimant a reasonable
opportunity for a full and fair review. After exhaustion of the Plan’s claim procedures, any
further legal action taken against the Plan or its fiduciaries by the Participant, Spouse, or
Beneficiary (or other claimant) for benefits under the Plan must be filed in a court of law no
later than 120 days after the Committee’s final decision regarding the claim. No action at law or
in equity shall be brought to recover benefits under this Plan until the appeal rights herein
provided have been exercised and the Plan benefits requested in such appeal have been denied in
whole or in part. All decisions and communications to Participants, Spouses, Beneficiaries, or
other persons regarding a claim for benefits under the Plan shall be held strictly confidential by
the Participant, Spouse, or Beneficiary (or other claimant), and the Committee, the Employers, and
their agents.

     11.8 Committee’s Decision Final

          Benefits under the Plan will be paid only if the Committee decides in its sole discretion that
a Participant or Beneficiary (or other claimant) is entitled to them. Subject to applicable law,
any interpretation of the provisions of the Plan and any decisions on any matter within the
discretion of the Committee made by the Committee or its delegate in good faith shall be binding on
all persons. A misstatement or other mistake of fact shall be corrected when it becomes known and
the Committee shall make such adjustment on account thereof as it considers equitable and
practicable.

-23-

 

SECTION 12 AMENDMENT AND TERMINATION

          While the Company expects and intends to continue the Plan, the Company and the Committee
reserve the right to amend the Plan at any time and for any reason, including the right to amend
this Section 12 and the Plan termination rules herein; provided, however, that each Participant
will be entitled to the amount credited to his Accounts immediately prior to such amendment . The
Company’s power to amend the Plan includes (without limitation) the power to change the Plan
provisions regarding eligibility, contributions, notional investments, vesting, and distribution
forms, and timing of payments, including changes applicable to benefits accrued prior to the
effective date of any such amendment; provided, however, that amendments to the Plan (other than
amendments relating to Plan termination) shall not cause the Plan to provide for acceleration of
distributions in violation of Section 409A of the Code and applicable regulations thereunder

          The Company and the Committee reserve the right to terminate the Plan at any time and for any
reason; provided, however, that each Participant will be entitled to the amount credited to his
Accounts immediately prior to such termination (but such Accounts shall not be adjusted for future
notional income, losses, expenses, appreciation and depreciation).

          In the event that the Plan is terminated pursuant to this Section 12, the balances in affected
Participants’ Accounts shall be distributed at the time and in the manner set forth in Section 9.
Notwithstanding the foregoing, the Company and the Committee reserve the right to make all such
distributions within the second twelve-month period commencing with the date of termination of the
Plan; provided, however, that no such distribution will be made during the first twelve-month
period following such date of Plan termination other than those that would otherwise be payable
under Section 9 absent the termination of the Plan.

-24-

 

SUPPLEMENT A

Special Contributions for Stephanie K. Kushner

          A-1. Special Contributions. Beginning in Plan Year 2007 and for each of the five Plan
years thereafter, the Company shall make an additional Special Contribution to the Company
Contribution Account of Stephanie Kushner under this Plan in the amount described in paragraph A-2
below. Such Special Contributions shall be made at the time and in the manner determined by the
Committee, and each Plan Year’s Special Contribution shall be made to the Plan only in the event
that Stephanie Kushner is employed on the anniversary of her date of hire; i.e., March 1 of the
applicable Plan Year as Chief Financial Officer of Federal Signal Corporation.

          A-2. Amount of Special Contributions. The amount of such Special Contributions shall
be as follows:

	 	 	 	 	 
	Year of Special Contribution	 	Amount of Special Contribution
	 	 		 	
	2007
	 	$	308,472	
	2008
	 	$	30,322	
	2009
	 	$	11,233	
	2010
	 	$	11,658	
	2011
	 	$	11,902	
	2012
	 	$	12,365	

          A-3. Vesting of Special Contributions. Special Contributions shall be 100% vested
five years after Stephanie Kushner’s date of hire in 2002; consequently, effective on the fifth
anniversary of Stephanie Kushner’s date of hire occurring in 2007, the Special Contributions made
in 2007 and thereafter shall each be 100% vested and nonforfeitable.

          A-4. Other Provisions of the Plan Applicable. All other provisions of the Plan are
applicable to Special Contributions made under this Supplement A.

-25-exv10wxhy

 

Exhibit 10-H

Executive General Severance Plan

Federal Signal Corporation

November 2006

 

 

Contents

	 	 	 	 	 
	Article 1. Establishment, Term, and Purpose

	 	 	1	 
	 
	 	 	 	 
	Article 2. Definitions

	 	 	1	 
	 
	 	 	 	 
	Article 3. Participation

	 	 	4	 
	 
	 	 	 	 
	Article 4. Severance Benefits

	 	 	4	 
	 
	 	 	 	 
	Article 5. The Company’s Payment Obligation

	 	 	6	 
	 
	 	 	 	 
	Article 6. Legal Remedies

	 	 	7	 
	 
	 	 	 	 
	Article 7. Withholding

	 	 	7	 
	 
	 	 	 	 
	Article 8. Noncompetition

	 	 	8	 
	 
	 	 	 	 
	Article 9. Successors and Assignment

	 	 	8	 
	 
	 	 	 	 
	Article 10. Miscellaneous

	 	 	9	 

 

 

Federal Signal Corporation

Executive General Severance Plan

Article 1. Establishment, Term, and Purpose

     1.1 Establishment of the Plan. Federal Signal Corporation (hereinafter referred to as
the “Company”) hereby establishes a severance plan to be known as the “Federal Signal Corporation
Executive General Severance Plan” (the “Plan”). The Plan provides severance benefits to certain
employees of the Company upon a termination of employment from the Company, not including a
termination of employment as a result of a Change in Control of the Company. Except for the
Change-in-Control Severance Agreements entered into with certain executives, the Plan is intended
to supersede any and all plans, programs, or agreements providing for severance-related payments.

     1.2 Term of the Plan. This Plan will commence on January 1, 2005 (the “Effective Date”) and
shall continue in effect for three (3) full calendar years. However, at the end of such three (3)
year period and, if extended, at the end of each additional year thereafter, the term of this Plan
shall be extended automatically for one (1) additional year, unless the Compensation Committee
delivers written notice six (6) months prior to the end of such term, or extended term, to each
Participant that the Plan will not be extended.

     In the event the term of the Plan is not extended for any reason, the Plan will terminate at
the end of the term, or extended term, then in progress, and the Participant will be deemed
terminated by the Company without Cause on such date.

     1.3 Purpose of the Plan. The purpose of the Plan is to provide certain key employees of the
Company financial security in the event of a termination of employment from the Company.

Article 2. Definitions

     Whenever used in this Plan, the following terms shall have the meanings set forth below
and, when the meaning is intended, the initial letter of the word is capitalized:

	 	(a)	 	“Base Salary” means, at any time, the then regular annual rate of pay which the
Participant is receiving as annual salary, excluding amounts: (i) received under
short-term or long-term incentive or other bonus plans, regardless of whether or not the
amounts are deferred, or (ii) designated by the Company as payment toward reimbursement of
expenses.
	 
	 	(b)	 	“Beneficiary” means the persons or entities designated or deemed designated by a
Participant pursuant to Section 10.2 herein.
	 
	 	(c)	 	“Benefits Committee” means the Benefits Planning Committee of the Company which was
appointed by the Compensation and Benefits Committee of the Company’s Board of Directors,
and is composed of certain officers or other employees of the Company.

1

 

	 	(d)	 	“Board” means the Board of Directors of the Company.
	 
	 	(e)	 	“Cause” shall be determined solely by the Benefits Committee except as expressly set
forth to the contrary hereinbelow), which shall have the authority to interpret the Plan
and to determine the meaning of any ambiguous Plan provisions in its sole and absolute
discretion, and shall mean the occurrence of any one or more of the following:

	 	(i)	 	The Participant’s failure to substantially perform his duties with
the Company (other than any such failure resulting from the Participant’s
Disability), after written notice of such failure and a reasonable opportunity to
cure following written notice; or
	 
	 	(ii)	 	The Participant’s conviction of a felony; or
	 
	 	(iii)	 	The Participant’s willful engaging in conduct that is demonstrably and
materially injurious to the Company, monetarily or otherwise. However, no act or
failure to act on the Participant’s part shall be deemed “willful” unless done, or
omitted to be done, by the Participant not in good faith and without reasonable
belief that the action or omission was in the best interests of the Company.
	 
	 	(iv)	 	The Participant’s material breach of Company policies, including but
not limited to the Company’s policy for business conduct.

Notwithstanding anything to the contrary stated herein, in the case of the determination
of Cause involving a Participant who is a member of the Company’s “Executive
Committee” as such term is defined in the Company’s then most recent annual report,
the Benefits Committee shall assign and cede all of its discretion and authority in
the determination of Cause to the Compensation Committee.

	 	(f)	 	“Code” means the Internal Revenue Code of 1986, as amended.
	 
	 	(g)	 	“Compensation Committee” means the Compensation and Benefits Committee of the Board
of Directors of the Company, or, if no Compensation Committee exists, then the full Board
of Directors of the Company, or a committee of Board members, as appointed by the full
Board to administer this Agreement.
	 
	 	(h)	 	“Company” means Federal Signal Corporation, a Delaware corporation (including any and
all subsidiaries), or any successor thereto as provided in Article 9 herein.
	 
	 	(i)	 	“Disability” or “Disabled” shall have the meaning ascribed to such term in the
Participant’s governing long-term disability plan, or if no such plan exists, at the
discretion of the Benefits Committee.
	 
	 	(j)	 	“Effective Date” means the date this Plan is approved by the Board, or such other
date as the Board shall designate in its resolution approving this Plan, and as specified
in the opening sentence of this Plan.

2

 

	 	(k)	 	“Effective Date of Termination” means the date on which a termination occurs which
triggers the payment of Severance Benefits hereunder.
	 
	 	(l)	 	“Good Reason” means, without the Participant’s express written consent, the
occurrence of any one (1) or more of the following:

	 	(i)	 	The assignment of the Participant to duties materially inconsistent
with the Participant’s authorities, duties, responsibilities, and status
(including offices, titles, and reporting requirements) as an executive and/or
officer of the Company, or a material reduction or alteration in the nature or
status of the Participant’s authorities, duties, or responsibilities from those in
effect as of the Effective Date, other than an insubstantial and inadvertent act
that is remedied by the Company promptly after receipt of notice thereof given by
the Participant;
	 
	 	(ii)	 	The Company’s requiring the Participant to be based at a location in
excess of fifty (50) miles from the location of the Participant’s principal job
location or office as of the Effective Date; except for required travel on the
Company’s business to an extent substantially consistent with the Participant’s
then present business travel obligations;
	 
	 	(iii)	 	A reduction by the Company of the Participant’s Base Salary in effect
on the Effective Date hereof, or as the same shall be increased from time to time;
	 
	 	(iv)	 	The failure of the Company to continue in effect any of the Company’s
short- and long-term incentive compensation plans, or employee benefit or
retirement plans, policies, practices, or other compensation arrangements in which
the Participant participates unless such failure to continue the plan, policy,
practice, or arrangement pertains to all plan participants generally; or the
failure by the Company to continue the Participant’s participation therein on
substantially the same basis, both in terms of the amount of benefits provided and
the level of the Participant’s participation relative to other participants, as of
the Effective Date;
	 
	 	(v)	 	The failure of the Company to obtain a satisfactory agreement from
any successor to the Company to assume and agree to perform the Company’s
obligations under this Plan, as contemplated in Article 9 herein; and
	 
	 	(vi)	 	A material breach of this Agreement by the Company which is not
remedied by the Company within ten (10) business days of receipt of written notice
of such breach delivered by the Participant to the Company.

Unless the Participant becomes Disabled, the Participant’s right to terminate employment
for Good Reason shall not be affected by the Participant’s incapacity due to physical or
mental illness. The Participant’s continued employment shall not constitute consent to,
or a waiver of rights with respect to, any circumstance constituting Good Reason herein.

	 	(m)	 	“Notice of Termination” shall mean a written notice which shall indicate the specific
termination provision in this Plan relied upon, and shall set forth in reasonable detail
the 

3

 

	 	 	 	facts and circumstances claimed to provide a basis for termination of the
Participant’s employment under the provision so indicated.

	 	(n)	 	“Participant” means an executive of the Company who is named by the Compensation
Committee as a Participant in the Plan, as set forth in Article 2 herein.
	 
	 	(o)	 	“Plan” has the meaning ascribed to such term in Section 1.1 hereof.
	 
	 	(p)	 	“Severance Benefits” means the payment of severance compensation as provided in
Article 4 herein.

Article 3. Participation

     3.1 Eligible Employees. Individuals eligible to participate in the Plan shall include
all key employees of the Company, as determined by the Compensation Committee in its sole
discretion.

     3.2 Participation. Subject to the terms of the Plan, the Compensation Committee may, from time
to time, select from all eligible employees those who shall participate in the Plan. From those
selected to participate in the Plan, the Benefits Committee shall assign each Participant to a
category as follows: Tier I Executives, Tier II Executives, or Tier III Executives.

Article 4. Severance Benefits

     4.1 Right to Severance Benefits. Subject to the provisions herein, each Participant
shall be entitled to receive from the Company Severance Benefits as described in Section 4.2
herein, if, during the term of the Plan, the Participant’s employment with the Company shall be
terminated by the Company without Cause, or voluntarily by the Participant for Good Reason.

     A Participant shall not be entitled to receive Severance Benefits under Section 4.2 hereof if
he or she is terminated for Cause, or if his or her employment with the Company ends due to death,
Disability, Retirement, or due to a voluntary termination of employment by the Participant without
Good Reason.

     4.2 Description of Severance Benefits. In the event that a Participant becomes entitled to
receive Severance Benefits, as provided in Section 4.1 herein, the Participant shall receive the
following Severance Benefits:

	 	(a)	 	Tier I Executives: One (1.0) times the sum of: (i) the Participant’s
Base Salary; and (ii) the Participant’s target annual bonus established for the
bonus plan year in which the Participant’s Effective Date of Termination occurs.

Tier II Executives: Three-quarters (0.75) times the sum of: (i) the Participant’s
Base Salary; and (ii) the Participant’s target annual bonus established for the
bonus plan year in which the Participant’s Effective Date of Termination occurs.

Tier III Executives: One-half (0.5) times the sum of: (i) the Participant’s
Base Salary; and (ii) the Participant’s target annual bonus established for the
bonus plan year in which the Participant’s Effective Date of Termination occurs.

4

 

	 	(b)	 	An amount equal to the Participant’s unpaid targeted annual bonus,
established for the plan year in which the Participant’s Effective Date of
Termination occurs, multiplied by a fraction, the numerator of which is the number
of days the Participant was employed by the Company in the then existing fiscal
year through the Effective Date of Termination, and the denominator of which is
three hundred sixty-five (365).
	 
	 	(c)	 	A continuation of the welfare benefits of medical insurance, dental
insurance, and group term life insurance for eighteen (18) months following the
Effective Date of Termination. These benefits shall be provided to Participants at
the same premium cost, and at the same coverage level, as in effect as of the
Participant’s Effective Date of Termination.

However, in the event the premium cost and/or level of coverage shall change for
all employees of the Company, the cost and/or coverage level, likewise, shall
change for each Participant in a corresponding manner.

The continuation of these welfare benefits shall be discontinued prior to the end
of the eighteen (18) month period in the event the Participant has available
substantially similar benefits from a subsequent employer, as determined by the
Benefits Committee.

	 	(d)	 	The treatment of accrued vacation days earned prior to the Effective
Date of Termination, but not taken by the Participant, shall be subject to the
treatment provided under the Company’s vacation policy.
	 
	 	(e)	 	All outstanding long-term incentive awards shall be subject to the
treatment provided under the applicable long-term incentive plan of the Company.

     4.3 Termination Due to Disability. If a Participant’s employment is terminated due to
Disability during the term of this Plan, the Participant shall receive his or her Base Salary and
accrued vacation through the Effective Date of Termination. All other benefits provided to the
Participant shall be determined in accordance with the Company’s disability, retirement, insurance,
and other applicable plans and programs then in effect.

     4.4 Termination Due to Death. If a Participant’s employment is terminated by reason of death,
the Participant, or where applicable, the Participant’s Beneficiaries, shall receive the
Participant’s Base Salary and accrued vacation through the Effective Date of Termination. All other
benefits provided to the Participant or the Participant’s Beneficiaries shall be determined in
accordance with the Company’s retirement, survivor’s benefits, insurance, and other applicable
programs of the Company then in effect.

5

 

     4.5 Termination for Cause or by a Participant Other Than for Good Reason. If a Participant’s
employment is terminated either: (a) by the Company for Cause; or (b) by the Participant other than
for Good Reason, the Company shall pay the Participant his or her unpaid Base Salary and accrued
vacation through the Effective Date of Termination, at the rate then in effect, plus all other
amounts to which the Participant is entitled under any compensation plans of the Company, at the
time such payments are due, and the Company shall have no further obligations to the Participant
under this Plan.

     4.6 Notice of Termination. Any termination by the Company for Cause or by a Participant for
Good Reason shall be communicated by Notice of Termination at least sixty (60) days prior to the
date on which such termination shall be effective.

     4.7 Form and Timing of Severance Benefits. The Severance Benefits set forth in this Article 4
shall be made as a continuation of pay (over the applicable severance period) through the normal
payroll procedures of the Company. If, as of the Effective Date of Termination, the Participant is
a “key employee” as that term is used in Code Section 409A (and the regulations promulgated
thereunder) then, the Severance Benefits, to the extent they are considered deferred compensation
under Section 409A or the regulations thereunder, shall begin six (6) months following the
Effective Date of Termination. Any Severance Benefits accrued during the first
six (6) months following a Participant’s Effective Date of Termination shall be paid in a lump
sum following such six (6) month period. Any remaining Severance Benefits shall then be paid
through the normal payroll procedures of the Company.

     4.8 No Duplication of Severance. If a Participant is a party to a change-in-control agreement
with the Company, the Participant shall not be entitled to receive a Severance Benefit under this
Plan if he or she is entitled to receive a severance benefit under the change-in-control agreement.

     4.9 Release. As a condition of receiving Severance Benefits under the Plan, the Participant is
required to sign a general release in a form acceptable to the Benefits Committee. No Severance
Benefits will be paid to a Participant until the applicable release becomes irrevocable in
accordance with its terms.

Article 5. The Company’s Payment Obligation

     5.1 Payment Obligations Absolute. The Company’s obligation to make the payments and the
arrangements provided for herein shall be absolute and unconditional, and shall not be affected by
any circumstances, including, without limitation, any offset, counterclaim, recoupment, defense, or
other right which the Company may have against Participants or anyone else. All amounts payable by
the Company hereunder shall be paid without notice or demand. Each and every payment made hereunder
by the Company shall be final, and the Company shall not seek to recover all or any part of such
payment from Participants or from whomsoever may be entitled thereto, for any reasons whatsoever.

6

 

     Participants shall not be obligated to seek other employment in mitigation of the amounts
payable or arrangements made under any provision of this Plan, and the obtaining of any such other
employment shall in no event effect any reduction of the Company’s obligations to make the payments
and arrangements required to be made under this Plan, except to the extent provided in Section
4.2(c) herein.

     5.2 Contractual Rights to Benefits. This Plan establishes and vests in each Participant a
contractual right to the benefits to which he or she is entitled hereunder. However, nothing herein
contained shall require or be deemed to require, or prohibit or be deemed to prohibit, the Company
to segregate, earmark, or otherwise set aside any funds or other assets, in trust or otherwise, to
provide for any payments to be made or required hereunder.

Article 6. Legal Remedies

     6.1 Payment of Legal Fees. To the extent permitted by law, the Company shall pay all
legal fees, costs of litigation, prejudgment interest, and other expenses incurred in good faith by
the Participant as a result of the Company’s refusal to provide the Severance Benefits to which the
Participant becomes entitled under this Plan, or as a result of the Company’s contesting the
validity, enforceability, or interpretation of this Plan, or as a result of any conflict between
the parties pertaining to this Plan; provided, however, that the Company shall be reimbursed by the
Participant for all such fees and expenses in the event the Participant fails to prevail with
respect to any one material issue of dispute in connection with such legal action.

     6.2 Arbitration. Subject to the following sentences, Participants shall have the right and
option to elect (in lieu of litigation) to have any dispute or controversy arising under or in
connection with this Plan settled by arbitration, conducted before a panel of three (3) arbitrators
sitting in a location selected by the Participant within fifty (50) miles from the location of his
job with the Company, in accordance with the rules of the American Arbitration Association then in
effect. The Participant shall not have the right to elect to have any dispute which arises under
Article 8 of this Plan settled by arbitration, but rather, the Company or the Participant shall
have the right to institute judicial proceedings in any court of competent jurisdiction with
respect to such dispute or claim. If judicial proceedings are instituted, the parties agree that
such proceedings shall not be stayed or delayed pending the outcome of any arbitration proceeding
hereunder.

     Except as provided above for claims or disputes under Article 8, judgment may be entered on
the award of the arbitrator in any court having proper jurisdiction. All expenses of such
arbitration, including the fees and expenses of the counsel for the Participant, shall be borne by
the Company; provided, however, that the Company shall be reimbursed by the Participant for all
such fees and expenses in the event the Participant fails to prevail with respect to any one
material issue of dispute in connection with such legal action.

Article 7. Withholding

     The Company shall be entitled to withhold from any amounts payable under this Plan all
taxes as legally shall be required (including, without limitation, any United States federal taxes,
and any other state, city, or local taxes).

7

 

Article 8. Noncompetition

     8.1 Prohibition on Competition. Without the prior written consent of the Company,
during the term of this Plan, and for a period of one (1) year following the payment of Severance
Benefits under this Plan, Participants shall not, as an employee or an officer, engage directly or
indirectly in any business or enterprise which is “in competition” with the Company or its
successors or assigns. For purposes of this Plan, a business or enterprise will be deemed to be “in
competition” if it is engaged in any significant business activity of the Company or its
subsidiaries within the United States of America.

     However Participants shall be allowed to purchase and hold for investment less than two
percent (2%) of the shares of any corporation whose shares are regularly traded on a national
securities exchange or in the over-the-counter market.

     8.2 Disclosure of Information. Participants recognize that they have access to and knowledge
of certain confidential and proprietary information of the Company which is essential to the
performance of their duties as employees of the Company. Participants will not, during or after the
term of their employment by the Company, in whole or in part, disclose such information to any
person, firm, corporation, association, or other entity for any reason or purpose whatsoever, nor
shall he or she make use of any such information for their own purposes.

     8.3 Covenants Regarding Other Employees. During the term of this Plan, and for a period of one
(1) year following the payment of Severance Benefits under this Plan, each Participant agrees not
to attempt to induce any employee of the Company to terminate his or her employment with the
Company, accept employment with any competitor of the Company, or to interfere in a similar manner
with the business of the Company.

Article 9. Successors and Assignment

     9.1 Successors to the Company. The Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) of all or substantially all of the
business and/or assets of the Company or of any division or subsidiary thereof to expressly assume
and agree to perform the Company’s obligations under this Plan in the same manner and to the same
extent that the Company would be required to perform them if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement prior to the effective date of any
such succession shall be a breach of this Plan and shall entitle Participants to compensation from
the Company in the same amount and on the same terms as they would be entitled to hereunder if they
had terminated their employment with the Company voluntarily for Good Reason. Except for the
purposes of implementing the foregoing, the date on which any such succession becomes effective
shall be deemed the Effective Date of Termination.

8

 

     9.2 Assignment by the Participant. This Plan shall inure to the benefit of and be enforceable
by each Participant’s personal or legal representatives, executors, administrators, successors,
heirs, distributees, devisees, and legatees. If a Participant dies while any amount would still be
payable to him or her hereunder had he or she continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Plan, to the Participant’s
Beneficiary. If the Participant has not named a Beneficiary, then such amounts shall be paid to the
Participant’s devisee, legatee, or other designee, or if there is no such designee, to the
Participant’s estate.

Article 10. Miscellaneous

     10.1 Employment Status. Except as may be provided under any other agreement between a
Participant and the Company, the employment of the Participant by the Company is “at will” and may
be terminated by either the Participant or the Company at any time, subject to applicable law.

     10.2 Beneficiaries. Each Participant may designate one or more persons or entities as the
primary and/or contingent Beneficiaries of any Severance Benefits owing to the Participant under
this Plan. Such designation must be in the form of a signed writing acceptable to the Benefits
Committee. Participants may make or change such designations at any time.

     10.3 Gender and Number. Except where otherwise indicated by the context, any masculine term
used herein also shall include the feminine, the feminine shall include the masculine, the plural
shall include the singular, and the singular shall include the plural.

     10.4 Severability. In the event any provision of this Plan shall be held illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and
the Plan shall be construed and enforced as if the illegal or invalid provision had not been
included. Further, the captions of this Plan are not part of the provisions hereof and shall have
no force and effect.

     10.5 Modification. The Compensation Committee shall have unilateral authority to approve any
amendment or modification to the Plan, in its sole and absolute discretion.

     10.6 Applicable Law. To the extent not preempted by the laws of the United States, the laws of
the state of Delaware shall be the controlling law in all matters relating to this Plan.

9

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