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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
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ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2007
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER 1-12387
A. Full title of the plan and address of the plan, if
different from that of the issuer named below:
THE TENNECO EMPLOYEE STOCK
OWNERSHIP PLAN FOR SALARIED EMPLOYEES
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
TENNECO INC.
500 NORTH FIELD DRIVE
LAKE FOREST, IL 60045
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THE TENNECO EMPLOYEE STOCK OWNERSHIP PLAN FOR SALARIED EMPLOYEES
Financial Statements as of December 31, 2007 and 2006, and for the Years Ended
December 31, 2007 and 2006, and Supplemental Schedule as of December 31, 2007,
and Independent Auditor's Report
The Tenneco Employee Stock Ownership Plan for Salaried Employees
TABLE OF CONTENTS
PAGE
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Financial Statements
- Report of Independent Registered Public Accounting Firm - Grant
Thornton LLP 3
- Report of Independent Registered Public Accounting Firm - Deloitte
& Touche LLP 4
- Statements of Net Assets Available for Benefits as of December
31, 2007 and 2006 5
- Statements of Changes in Net Assets Available for Benefits for
the Years Ended December 31, 2007 and 2006 6
- Notes to Financial Statements as of December 31, 2007 and 2006 7-13
Supplemental Schedule 14
- Form 5500, Schedule H, Part IV, Line 4i - Schedule of Assets
(Held at End of Year) as of December 31, 2007 15
Note: All other schedules required by Section 2520.103-10 of the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974 have been omitted because they are not
applicable.
2
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Corporate Employee Benefits
Committee of Tenneco Inc.:
We have audited the accompanying statement of net assets available for benefits
of The Tenneco Employee Stock Ownership Plan for Salaried Employees (the "Plan")
as of December 31, 2007, and the related statement of changes in net assets
available for benefits for the year ended December 31, 2007. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Plan is not required to have,
nor were we engaged to perform an audit of its internal control over financial
reporting. Our audit included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Plan's internal control over financial reporting.
Accordingly, we express no such opinion. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 2007, and the changes in net assets available for benefits for the
year ended December 31, 2007, in conformity with accounting principles generally
accepted in the United States of America.
Our audit was performed for the purpose of forming an opinion on the basic 2007
financial statements taken as a whole. The supplemental schedule of assets (held
at end of year) is presented for the purpose of additional analysis and is not a
required part of the basic 2007 financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic 2007 financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic 2007 financial
statements taken as a whole.
Grant Thornton LLP
Chicago, Illinois
June 24, 2008
3
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Trustees and Participants of
The Tenneco Employee Stock
Ownership Plan for Salaried Employees:
We have audited the accompanying statement of net assets available for benefits
of The Tenneco Employee Stock Ownership Plan for Salaried Employees (the "Plan")
as of December 31, 2006, and the related statement of changes in net assets
available for benefits for the year then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Plan is not required to have,
nor were we engaged to perform, an audit of its internal control over financial
reporting. Our audit included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Plan's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan at December 31,
2006, and the changes in net assets available for benefits for the year then
ended, in conformity with accounting principles generally accepted in the United
States of America.
As discussed in Note B to the financial statements, the Plan retrospectively
adopted Financial Accounting Standards Board Staff Position AAG INV-1 and
94-4-1, Reporting of Fully Benefit-responsive Investment Contracts Held by
Certain Investment Companies Subject to the AICPA Investment Company Guide and
Defined-Contribution Health and Welfare and Pension Plans.
Deloitte & Touche LLP
Chicago, Illinois
June 25, 2007
4
The Tenneco Employee Stock Ownership Plan for Salaried Employees
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 2007 AND 2006
2007 2006
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ASSETS:
Plan interest in Tenneco Defined Contribution Plans
Master Trust:
Participant-directed investments $219,868,555 $191,574,107
Nonparticipant-directed investments (Note D) 19,213,209 33,839,353
------------ ------------
Total investments, at fair value 239,081,764 225,413,460
Receivables:
Participants contributions 415,478 366,714
Employer contributions 403,273 147,902
Employer supplemental contributions (Note G) 0 60,519
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Total receivables 818,751 575,135
Total assets 239,900,515 225,988,595
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LIABILITIES:
Accrued administrative expenses 0 61,000
Excess contributions refundable (Note G) 0 624,531
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Total liabilities 0 685,531
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NET ASSETS AVAILABLE AT FAIR VALUE 239,900,515 225,303,064
Adjustments from fair value to contract value for fully
benefit-responsive investment contracts 141,773 400,977
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NET ASSETS AVAILABLE FOR BENEFITS $240,042,288 $225,704,041
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The accompanying notes are an integral part of these statements.
5
The Tenneco Employee Stock Ownership Plan for Salaried Employees
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006
2007 2006
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ADDITIONS:
Contributions:
Participant contributions $ 10,464,035 $ 9,838,553
Employer contributions 9,838,745 3,744,869
Rollovers 204,330 580,843
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Total contributions 20,507,110 14,164,265
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Investment income:
Net appreciation in fair value of investments 0 13,675,670
Dividend 0 328,205
Interest 0 295,245
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Plan's interest in Tenneco Defined Contribution
Plans Master Trust 12,890,650 20,459,041
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Net investment income 12,890,650 34,758,161
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Transfers into Plan (Note B) 580,056 369,818
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Total additions 33,977,816 49,292,244
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DEDUCTIONS:
Benefits paid to participants 19,536,403 21,564,276
Administrative expenses 103,166 142,216
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Total deductions 19,639,569 21,706,492
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INCREASE IN NET ASSETS 14,338,247 27,585,752
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 225,704,041 198,118,289
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End of year $240,042,288 $225,704,041
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The accompanying notes are an integral part of these statements.
6
The Tenneco Employee Stock Ownership Plan for Salaried Employees
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2007 AND 2006, AND FOR THE YEARS ENDED DECEMBER
31, 2007 AND 2006
A. DESCRIPTION OF THE PLAN
The following is a description of The Tenneco Employee Stock Ownership Plan
for Salaried Employees (the "Plan"). Participants should refer to the Plan
document for more complete information.
GENERAL - The Plan is a defined contribution plan covering substantially
all U.S. salaried employees of Tenneco Automotive Operating Company Inc.
(the "Company") and certain of its affiliates. The Company controls and
manages the operation and administration of the Plan. The Plan is subject
to the provisions of the Employee Retirement Income Security Act of 1974
("ERISA"), as amended.
MASTER TRUST - Effective April 1, 2006, the Plan assets are held by Mellon
Bank, N.A., as Trustee, in the Tenneco Defined Contribution Plans Master
Trust (the "Master Trust"). Prior to April 1, 2006, the Plan assets were
held by Putnam Fiduciary Trust Company.
ELIGIBILITY - Employees are eligible to participate in the Plan the first
day of the month following the Company's receipt of an application for
enrollment or two complete calendar months of employment provided the
employee has not waived automatic enrollment.
CONTRIBUTIONS - An employee is automatically enrolled in the Plan upon
completion of the eligibility requirements at a pretax contribution rate of
4% of pretax annual compensation, as defined in the Plan document, subject
to certain Internal Revenue Code ("IRC") limitations, unless the employee
elects to waive automatic enrollment prior to the effective date.
Participants can elect to increase the pretax deferral rate, subject to
certain IRC limitations, from 4% up to 75%, in any whole percentage, at any
time.
The Company's matching contribution is 50% of the participant's
contributions, not to exceed a match level of 4% of the participant's base
compensation. For participants hired on or after April 1, 2005, there is an
additional 2% non-elective employer contribution after one year of service.
Additional amounts may be contributed at the discretion of the Company. No
such additional discretionary contributions were made for the years ended
December 31, 2007 and 2006. Participants may also roll over amounts from
other qualified plans.
Effective January 1, 2002, Company matching contributions are made in cash.
Prior to January 1, 2002, Company matching contributions were made in the
Company's common stock to the Tenneco Inc. Common Stock Fund. All Company
matching contributions of Company common stock made prior to January 1,
2002, and the related earnings/losses, will remain in the form of the
Company's common stock until the participant reaches age 55 or terminates
employment and requests a total distribution. Beginning in 2006, one-third
of these matching contributions will be unrestricted each year until there
are no longer any restricted company match shares remaining.
7
Effective January 1, 2007, the Plan was amended to provide supplemental
annual company contributions based upon a participant's age in accordance
with an age-graded schedule for those employees who ceased to accrue
benefits under the Company's defined benefit plans.
PARTICIPANT ACCOUNTS - Individual accounts are maintained for each Plan
participant. Each participant's account is credited with the participant's
contribution, the Company's matching contribution, and allocations of
Company discretionary contributions and Plan earnings, and charged with
withdrawals and an allocation of Plan losses and administrative expenses.
Allocations are based on participant earnings or account balances, as
defined. The benefit to which a participant is entitled is the benefit that
can be provided from the participant's vested account.
INVESTMENTS - Participants direct the investment of their contributions and
the Company's matching contributions into various investment options
offered by the Plan. The Plan currently offers participants the option to
invest their contributions in the following types of funds: stable value (1
offered), Tenneco Inc. common stock (1 offered), and mutual funds (23
offered).
Shares of Pactiv Corporation common stock are held by the Plan in a
separate fund due to a transfer of participant account balances from
another defined contribution plan in 2000; however, the fund is no longer
an investment option for participants and direct contributions or fund
transfers into this fund are not allowed.
VESTING - Participants are vested immediately in pretax and matching
contributions plus actual earnings thereon. The Company's 2% non-elective
employer contribution and supplemental annual company contributions cliff
vest 3 years after an employee's date of hire; all other matching
contributions vest immediately.
PARTICIPANT LOANS - Active participants and certain other individuals may
borrow from their accounts a minimum of $1,000 up to a maximum of $50,000,
less their highest outstanding loan balance in the previous 12 months or
50% of their account balance, whichever is less, as long as the
participants or individuals have no outstanding loans. Each participant may
only have one loan outstanding at any time, with a term not to exceed 54
months. The loans are secured by the balance in the participant's account
and bear interest at rates equal to the prime rate as reported in The Wall
Street Journal at the time the loan is made. Principal and interest are
paid ratably through payroll deductions.
TERMINATION OF PARTICIPATION - Upon termination of service due to death,
disability, retirement, or termination of employment, a participant is
permitted to elect either to receive a lump-sum distribution equal to the
value of the participant's vested interest in his or her account, or to
maintain the account, if the participant's vested interest in the account
was more the $1,000. If the participant's account is less than $1,000, the
participant is required to receive a lump-sum amount or roll over the
amount to another qualified plan or IRA.
FORFEITURES - At December 31, 2007, forfeited nonvested accounts totaled
$6,224. These forfeitures will be used to reduce future employer
contributions. For the year ended December 31, 2007, employer contributions
were reduced by $69,594 from forfeited nonvested accounts. If a participant
terminates and is rehired within five years, any forfeited balance will be
reinstated.
B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The financial statements of the Plan are prepared
under the accrual method of accounting.
8
As described in Financial Accounting Standards Board Staff Position, FSP
AAG INV-1 and SOP 94-4-1, "Reporting of Fully Benefit-Responsive Investment
Contracts Held by Certain Investment Companies Subject to the AICPA
Investment Company Guide and Defined-Contribution Health and Welfare and
Pension Plans" (the "FSP"), investment contracts held by a
defined-contribution plan are required to be reported at fair value.
However, contract value is the relevant measurement attributable for that
portion of the net assets available for benefits of a defined-contribution
plan attributable to fully benefit-responsive investment contracts because
contract value is the amount participants would receive if they were to
initiate permitted transactions under the terms of the Plan. The Plan
invests in investment contracts through the Mellon Stable Value Fund. As
required by the FSP, the Statements of Net Assets Available for benefits
present the fair value of the investment contracts as well as the
adjustment of the fully benefit-responsive investment contracts from fair
value to contract value. The Statements of Changes in Net Assets Available
for Benefits are prepared on a contract value basis.
USE OF ESTIMATES - The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities, and changes therein. Actual
results could differ from those estimates.
RISKS AND UNCERTAINTIES - The Plan utilizes various investment instruments,
including common stock, mutual funds, and collective trusts funds.
Investment securities are exposed to various risks such as interest rate,
market, and credit risks. Due to the level of risk associated with certain
investment securities, it is reasonably possible that changes in the values
of investment securities will occur in the near term and that such changes
could materially affect participant account balances and the amounts
reported in the statement of net assets available for benefits.
INVESTMENT VALUATION AND INCOME RECOGNITION - The Plan's investment in the
Master Trust is presented at fair value, which has been determined based on
the fair value of the underlying investments of the Master Trust. Quoted
market prices are used to determine the fair value of the Plan's
investments, when available. Shares of registered investment companies are
valued at quoted market prices. The master trust's interest in the Mellon
Stable Value Fund, a collective trust, is valued at its net asset value
based on information reported by the investment advisor using audited
financial statements of the collective trust at year end. The Mellon Stable
Value Fund is a stable value fund that may invest in fixed interest
insurance investment contracts, money market funds, corporate and
government bonds, mortgage-backed securities, bond funds, and other fixed
income securities. Participants may ordinarily direct the withdrawal or
transfer of all or a portion of their investment at contract value.
Contract value represents contributions made to the fund, plus earnings,
less participant withdrawals. Participant loans are valued at the
outstanding loan balances.
Management fees and operating expenses charged to the Plan for investments
in registered investment companies are deducted from income earned on a
daily basis and are not separately reflected. Consequently, these
management fees and operating expenses are reflected as a reduction of net
appreciation (depreciation) in the fair market value of investments for
such investments.
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends are recorded on
the ex-dividend date.
NET APPRECIATION / (DEPRECIATION) IN FAIR VALUE OF INVESTMENTS - Net
realized and unrealized appreciation (depreciation) is recorded in the
accompanying statements of changes in net assets available for benefits as
net appreciation in fair value of investments.
9
ADMINISTRATIVE EXPENSES - Administrative expenses of the Plan are paid by
the Plan as provided by the Plan document. The Master Trust is authorized
to charge and collect from the fund expenses incurred, unless such expenses
are paid directly by the Company.
PAYMENT OF BENEFITS - Benefit payments to participants, including deemed
distributions of participant loans, are recorded when paid.
TRANSFERS - The Company also sponsors an employee stock ownership plan for
hourly employees. If employees change their hourly or salaried status
during the year, their account balances are transferred into the
corresponding plan.
EXCESS CONTRIBUTIONS REFUNDABLE - The Plan is required to return
contributions received in excess of IRC limits.
C. INVESTMENTS
Assets are held in a master trust as of December 31, 2007 and 2006, and the
Plan's only investment is an investment in that Master Trust.
For the three months ended March 31, 2006, the Plan's investments (including
gains and losses on investments bought and sold, as well as held during the
year) appreciated in value as follows:
Registered investment companies $ 5,535,394
Pactiv Corporation common stock 825,988
Tenneco Inc. common stock 7,314,288
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Net appreciation in fair value of investments $13,675,670
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D. NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets as of December 31, 2007 and 2006 and the
significant components of the changes in net assets relating to the
nonparticipant-directed investments for the years ended December 31, 2007
and 2006, is as follows:
2007 2006
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Net assets:
Master Trust - Tenneco Inc. common stock $ 19,213,209 $ 33,839,353
Changes in net assets:
Net appreciation in fair value of investments 0 5,326,637
Benefits paid to participants (2,682,868) (850,252)
Administrative expenses (18,177) (24,523)
Transfers to participant-directed investments (14,183,618) (15,915,800)
Investment income from Master Trust 2,258,519 2,414,224
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Total $(14,626,144) $ (9,049,714)
============ ============
E. EXEMPT PARTIES-IN-INTEREST TRANSACTIONS
At December 31, 2007 and 2006, the Master Trust held shares of the Mellon
Stable Value Fund which is managed by Mellon Bank, N.A. Mellon Bank N.A. is
the trustee as defined by the Master Trust and, therefore these
transactions qualify as party-in-interest transactions. Fees paid by the
Plan for investment management services were included as a reduction of the
return earned on this investment.
At December 31, 2007 and 2006, the Master Trust held 3,589,835 and
4,289,683, respectively, shares of common stock of Tenneco Inc., the
sponsoring employer, with a cost basis of $37,653,408 and $28,205,994,
respectively.
F. PLAN TERMINATION
Although it has not expressed any intention to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions set forth in ERISA. In the
event of a plan termination, participants would become 100% vested in
employer contributions. Any assets which are not allocated to the accounts
of participants upon the complete termination of the Plan, or complete
discontinuance of contributions, will be allocated among all of the
participant accounts pro rata on the basis of their respective balances.
10
G. FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter, dated April 30, 2002, that the Plan was designed in accordance with
applicable regulations of the IRC. The Plan has been amended since
receiving the determination letter; however, the Company and the Plan
administrator believe that the Plan is currently designed and operated in
all material respects in compliance with the applicable requirements of the
Internal Revenue Code and the Plan and related Trust continue to be
tax-exempt. Therefore, no provision for income taxes has been included in
the Plan's financial statements.
While conducting non-discrimination testing for the Plan for the 2006 plan
year, it was determined that the Plan's prior recordkeeper did not use
correct compensation when performing tests for prior plan years. The
Company worked with its current and prior record keepers and the Plan's tax
counsel to address this situation.
When non-discrimination tests were performed using correct compensation and
properly classified employees, the Plan failed the Actual Deferral
Percentage ("ADP") and Actual Contribution Percentage ("ACP") tests for the
2004 and 2005 plan years. All affected participants have been identified,
as has the proper method of correcting the testing failures. Correction has
taken place for all affected participants with respect to the 2005 plan
year, within the timeline allowed for correction under the IRC. At December
31, 2006, the Plan has recorded an amount payable to participants in the
amount of $624,531 which represents the total excess contributions to be
returned to Plan Participants for both 2004 and 2006 as part of the
correction of the non-discrimination testing. In addition, the Plan has
recorded an amount receivable from the Company for $60,519 related to this
issue.
In addition, the new record keeper finalized 2006 ADP and ACP tests using
correct information and timely correction was made to all affected
participants during 2007.
H. INTEREST IN MASTER TRUST
Effective April 1, 2006, the Plan's investment assets are held in a trust
account at the Trustee and consist of an undivided interest in an
investment account of the Master Trust. Use of the Master Trust permits the
commingling of trust assets for investment and administrative purposes.
Although assets of both the Tenneco Employee Stock Ownership Plans for
Hourly and Salaried Employees are commingled in the Master Trust, the
Trustee maintains supporting records for the purpose of allocating the net
gain or loss of the investment account to the participating plans. The net
investment income of the investment assets is allocated by the Trustee to
each participating plan based on the relationship of the interest of each
plan to the total of the interests of the participating plans. The Master
Trust is authorized to charge and collect from the fund expenses incurred,
unless such expenses are paid directly by the Company.
11
The investments of the Master Trust as of December 31, 2007 and 2006, are
summarized as follows:
2007 2006
------------ ------------
Investments, at fair value:
Loans $ 13,606,970 $ 0
Registered Investment Companies 225,146,461 $208,609,526
Collective trusts 50,003,284 47,461,382
Pactiv common stock 7,038,375 11,074,826
Tenneco Inc. common stock 95,094,738 103,074,701
------------ ------------
Total investments at fair value 390,889,828 370,220,435
------------ ------------
Adjustment from Fair Value to Contract Value for fully
benefit-responsive investment contracts 247,813 655,731
------------ ------------
Net assets of the Tenneco Defined Contribution Plans
Master Trust at contract value $391,137,641 $370,876,166
------------ ------------
Plan's interest in net assets of the Master Trust at fair value $239,081,764 $225,413,460
============ ============
Plan's interest in net assets of the Master Trust at contract value $239,223,537 $225,814,437
============ ============
Plan's interest in net assets of the Master Trust as a
percentage of the total at contract value 61% 61%
============ ============
The net investment earnings of the Master Trust for the years ended
December 31, 2007 and 2006 is summarized below:
2007 2006
----------- -----------
Dividend and interest income $ 6,041,209 $ 480,691
Net appreciation in fair value of investments:
Registered Investment Companies 10,429,879 14,426,173
Collective trusts 2,086,817 1,555,024
Pactiv common stock (2,531,704) 3,720,379
Tenneco Inc. common stock 6,793,282 11,725,685
----------- -----------
Net appreciation in fair value of investments 16,778,274 31,427,261
----------- -----------
Investment income of Tenneco Defined Contribution Plans Master Trust $22,819,483 $31,907,952
=========== ===========
12
I. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
A reconciliation of net assets available for benefits per the financial
statements to Form 5500 at December 31, 2007 and 2006, is as follows:
2007 2006
------------ ------------
Net assets available for benefits per the financial statements $240,042,288 $225,704,041
Deemed distributions of participant loans 0 (32,230)
Less adjustment from fair value to contract value for fully
benefit-responsive contracts (141,773) 0
------------ ------------
Net assets available for benefits per Form 5500 $239,900,515 $225,671,811
============ ============
A reconciliation of changes in net assets available for benefits per the
financial statements for the year ended December 31, 2007 and 2006 to Form
5500 is as follows:
2007 2006
----------- -----------
Benefits paid to participants per the financial statements $19,536,403 $21,564,276
Add deemed distributions of participant loans at December 31,
for respective year 0 32,230
Less deemed distributions of participant loans at December 31,
for respective year (32,230) (61,036)
----------- -----------
Benefits paid to participants per Form 5500 $19,504,173 $21,535,470
=========== ===========
Investment income per the financial statements $12,890,650
Adjustment from fair value to contract value for fully
benefit-responsive contracts (141,773)
-----------
Investment income per Form 5500 $12,748,877
===========
13
SUPPLEMENTAL SCHEDULE
14
The Tenneco Employee Stock Ownership Plan for Salaried Employees
FORM 5500, SCHEDULE H, PART IV, LINE 4I - SCHEDULE OF ASSETS (HELD AT END
OF YEAR) AS OF DECEMBER 31, 2007
IDENTITY OF ISSUER/DESCRIPTION OF INVESTMENT COST** FAIR VALUE
-------------------------------------------- ------ ----------
* Participant loans (maturing 2007 to 2010 at interest
rates of 4.0% to 8.25%) $0 $3,918,755
--- ----------
Total $0 $3,918,755
--- ----------
* Party-in-interest
** Cost information is not required for participant-directed investments and
is therefore not included.
15
SIGNATURES
THE PLAN - Pursuant to the requirements of the Securities and Exchange Act of
1934, the Tenneco Inc. Benefits Committee has duly caused this annual report to
be signed on its behalf by the undersigned hereunder duly authorized.
THE TENNECO EMPLOYEE
STOCK OWNERSHIP PLAN FOR SALARIED
EMPLOYEES
Date: June 30, 2008 /s/ RICHARD P. SCHNEIDER
-----------------------------------
RICHARD P. SCHNEIDER
CHAIRMAN OF TENNECO INC.
BENEFITS COMMITTEE
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------- ---------------------------------------------
23.1 Consent of Grant Thornton LLP
23.2 Consent of Deloitte & Touche LLP