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•	Adjusted annual Revenue of $14.509 billion, an increase of 3% over 2012;

•	Adjusted OI of $1.639 billion, an increase of 8% over 2012;

•	Adjusted OI margin of 11.3 %, an increase of 0.5 percentage points from 10.8% in 2012;

•	Adjusted Cash Flow of $1.153 billion an increase of 14% over 2012;

•	Adjusted EPS of $3.63 excluding one-time spin related expense, an increase of 10% over 2012; and

•	3-year EPS growth (2011 - 2013) of 68.1%, which ranks at approximately the 75th percentile of the companies in the S&P 500 Industrials Index.

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•	Chairman and Chief Executive Officer of Financial Guaranty Insurance Company (insurer of municipal bonds and structured finance obligations), a subsidiary of General Electric Capital Corporation, from 1992 to 2001.

•	Current Directorships:

▪	Exelon Corporation

▪	Baltimore Gas & Electric Company

•	Other Directorships Held in the Past Five Years:

▪	Constellation Energy Group, Inc.

▪	Kindred Healthcare, Inc.

•	European Union Commission Head of Delegation to the United States from 2004 to 2009.

•	Prime Minister of the Republic of Ireland from 1994 to 1997.

•	Current Directorships:

▪	Montpelier Re Holding Ltd.

•	Other Directorships Held in the Past Five Years: None

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•	President Emeritus at Carnegie Mellon University, President of Carnegie Mellon University from 1997-2013 and also appointed Professor of Civil and Environmental Engineering and Professor of Engineering and Public Policy.

•	Current Directorships:

▪	Lexmark, Inc.

▪	Unisys

•	Other Directorships Held in the Past Five Years: None

•	Other Activities:

▪	Carnegie Corporation, Trustee

▪	Heinz Endowments, Trustee

▪	Center for Sustainable Shale Gas Development, Director and Chair

•	President, University of Missouri System from 2008 to 2011.

•	Chairman of the Board (from 2006 to 2007) and Chief Executive Officer (from 2005 to 2007) of Sprint Nextel Corporation (a telecommunications company).

•	Current Directorships:

▪	Great Plains Energy Inc.

•	Other Directorships Held in the Past Five Years: None

•	Other Activities:

▪	Trustee, Midwest Research Institute

▪	Trustee, University of Missouri - Kansas City Foundation

▪	Trustee, University of Missouri – Kansas City Bloch Business School Foundation

•	Vice-Chairman of Ford Motor Company (an automobile manufacturer) from 1996 until his retirement in 1999.

•	Chairman of Visteon Automotive Systems (a manufacturer and supplier of automobile products) from 1997 to 1999.

•	Current Directorships:

▪	AmeriSourceBergen Corporation

•	Other Directorships Held in the Past Five Years:

▪	Air Products and Chemicals, Inc.

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•	Guest Scholar at the Brookings Institution (a non-partisan research institute) from 1993 to 2005.

•	Commissioner of U.S. Commission on Civil Rights from 1993 to 1998.

•	Assistant to the President and Director of Presidential Personnel from 1991 to 1993.

•	Deputy Secretary, U.S. Department of Health and Human Services from 1989 to 1991.

•	Current Directorships:

▪	Pfizer Inc.

▪	Prudential Financial, Inc.

•	Other Directorships Held in the Past Five Years: None

•	Other Activities:

▪	Trustee, The Prudential Foundation

▪	Fellow, National Academy of Public Administration

•	President and Chief Executive Officer (since February 2010) of the Company.

•	President and Chief Operating Officer of the Company from February 2009 to February 2010.

•	Senior Vice President and President, Trane Commercial Systems, of the Company from June 2008 to September 2009.

•	Current Directorships:

▪	Iron Mountain Incorporated

•	Other Directorships Held in the Past Five Years: None

•	President and Chief Executive Officer of Barnes Group Inc. (manufacturer and distributor of automotive and aircraft components and maintenance products) from 1995 until his retirement in 1998.

•	Current Directorships: None

•	Other Directorships Held in the Past Five Years:

▪	Applied Biosystems, Inc. (formerly known as Applera Corporation)

▪	C. R. Bard, Inc.

▪	Unisys Corporation

•	Other Activities:

▪	Edna McConnell Clark Foundation

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•	Former Chairman (from 2006-2013) and Chief Executive Officer (from 2004-2013) of United States Steel Corporation (a steel manufacturing company).

•	Current Directorships:

▪	Marathon Petroleum Corporation

▪	MPLX LP (a publicly traded subsidiary of Marathon Petroleum Corporation)

▪	Concho Resources Inc.

•	Other Directorships Held in the Past Five Years:

▪	The Bank of New York Mellon Corporation

•	Other Activities:

▪	Vice Chairman, U.S. President’s Advisory Committee for Trade Policy and Negotiations

▪	Director, Federal Reserve Bank of Cleveland

•	Chairman of Financial Accounting Standards Advisory Council from 2002 through 2006.

•	Chairman, President and Chief Executive Officer of Foster Wheeler Ltd. (provider of design, engineering, construction, manufacturing, management and environmental services) from 1994 to 2001.

•	Current Directorships:

▪	CVS Caremark Corporation

▪	Hubbell Incorporated

▪	Kaman Corporation

▪	Public Service Enterprise Group

•	Other Directorships Held in the Past Five Years: None

•	Chairman, President and Chief Executive Officer of Applied Biosystems Inc. (a developer, manufacturer and marketer of life science systems and genomic information products) from 1995 until his retirement in 2008.

•	Current Directorships:

▪	C.R. Bard, Inc.

▪	CVS Caremark Corporation

•	Other Directorships Held in the Past Five Years: None

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•	Program competitiveness

•	Pay for performance

•	Mix of short and long-term incentives

•	Internal parity

•	Shareholder alignment

•	Business strategy alignment

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(a)	the maximum price at which such treasury share may be reissued off-market shall be an amount equal to 120% of the “market price”; and

(b)	the minimum price at which a treasury share may be reissued off-market shall be the nominal value of the share where such a share is required to satisfy an obligation under an employee share scheme or any option schemes operated by the Company or, in all other cases, an amount equal to 95% of the “market price”; and

(c)	for the purposes of this resolution, the “market price” shall mean the closing market price of the ordinary shares on the NYSE the day preceding the day on which the relevant share is re-issued.

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•	selecting, monitoring, evaluating and compensating senior management;

•	assuring that management succession planning is ongoing;

•	reviewing the Company’s financial controls and reporting systems;

•	overseeing the Company’s management of enterprise risk;

•	reviewing the Company’s ethical standards and compliance procedures; and

•	evaluating the performance of the Board of Directors, Board committees and individual directors.

•	Chair the meetings of the independent directors when the Chairman is not present;

•	Ensure the full participation and engagement of all Board members in deliberations;

•	Lead the Board of Directors in all deliberations involving the CEO’s employment, including hiring, contract negotiations, performance evaluations, and dismissal;

•	Counsel the Chairman on issues of interest/concern to directors and encourage all directors to engage the Chairman with their interests and concerns;

•	Work with the Chairman to develop an appropriate schedule of Board meetings and approve such schedule, to ensure that the directors have sufficient time for discussion of all agenda items, while not interfering with the flow of Company operations;

•	Work with the Chairman to develop the Board and Committee agendas and approve the final agendas;

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Keep abreast of key Company activities and advise the Chairman as to the quality, quantity and timeliness of the flow of information from Company management that is necessary for the directors to effectively and responsibly perform their duties; although Company management is responsible for the preparation of materials for the Board of Directors, the Lead Director will approve information provided to the Board and may specifically request the inclusion of certain material;

•	Engage consultants who report directly to the Board of Directors and assist in recommending consultants that work directly for Board Committees;

•	Work in conjunction with the Corporate Governance and Nominating Committee in compliance with Governance Committee processes to interview all Board candidates and make recommendations to the Board of Directors;

•	Assist the Board of Directors and Company officers in assuring compliance with and implementation of the Company’s Governance Guidelines; work in conjunction with the Corporate Governance Committee to recommend revisions to the Governance Guidelines;

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•	Call, coordinate and develop the agenda for and chair executive sessions of the Board’s independent directors; act as principal liaison between the independent directors and the CEO;

•	Work in conjunction with the Corporate Governance and Nominating Committee to identify for appointment the members of the various Board Committees, as well as selection of the Committee chairs;

•	Be available for consultation and direct communication with major shareholders;

•	Make a commitment to serve in the role of Lead Director for a minimum of three years; and

•	Help set the tone for the highest standards of ethics and integrity.

•	The Audit Committee oversees risks associated with the Company’s systems of disclosure controls and internal controls over financial reporting, as well as the Company’s compliance with legal and regulatory requirements.

•	The Compensation Committee considers risks related to the attraction and retention of talent and risks related to the design of compensation programs and arrangements.

•	The Corporate Governance and Nominating Committee oversees risks associated with sustainability.

•	The Finance Committee oversees risks associated with foreign exchange, insurance, credit and debt.

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•	An increase in the annual retainer to $285,000 with one half of the retainer paid in cash and one half paid in RSUs;

•	An increase in the Compensation Committee Chair Cash Retainer to $20,000;

•	An increase in the cash retainers for the Corporate Governance and Nominating Chair and the Finance Committee Chair to $15,000;

•	Elimination of tax equalization payments on retainers beginning with the retainers earned for the 2014 fiscal year; and

•	Updating our director share ownership requirement as described below effective as of January 1, 2014.

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•	Mr. Michael W. Lamach, our Chairman and Chief Executive Officer;

•	Ms. Susan K. Carter, our Senior Vice President and Chief Financial Officer;

•	Mr. Gary S. Michel, our Senior Vice President and President, Residential HVAC North America;

•	Mr. Didier P. M. Teirlinck, Ph.D., our Executive Vice President, Climate segment; and

•	Mr. Robert G. Zafari, our Executive Vice President, Industrial segment.

•	Mr. Steven R. Shawley, our former Senior Vice President and Chief Financial Officer; and

•	Mr. John W. Conover IV, our former Senior Vice President and President, Security Technologies.

I.	Executive Summary.

II.	Compensation Philosophy and Design Principles.

III.	Factors Considered in the Determination of Target Total Direct Compensation.

IV.	Role of the Compensation Committee, Independent Advisor, and Committee Actions.

V.	Compensation Program Descriptions and Compensation Decisions.

VI.	Other Compensation and Tax Matters.

(i)	program competitiveness,

(ii)	pay for performance,

(iii)	mix of short and long-term incentives,

(iv)	internal parity,

(v)	shareholder alignment, and

(vi)	business strategy alignment.

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•	3-year EPS growth (2011 - 2013) of 68.1%, which ranks at approximately the 75th percentile of the companies in the S&P 500 Industrials Index.

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Reviewed and approved adjustments to the 2013 AIM design to better reward balanced growth and profitability as well as to improve the alignment of payouts with performance. The 2013 AIM program is designed to reward performance for the achievement of pre-defined goals related to the metrics of Revenue, OI and Cash Flow (weighted equally and modified by OI Margin) as opposed to Revenue Growth and OI Margin in prior years (which were incorporated into a matrix modified by Cash Flow performance). The 2013 design provided participants greater clarity as to how performance results impacted their incentive opportunity;

•	As approved by shareholders, implemented a new Incentive Stock Plan for Ingersoll Rand equity-based awards;

•	In support of the Spin-off, adopted conversion formulas to adjust executive compensation and benefit programs with an equity-based component;

•	Reviewed and approved new compensation and benefit programs for Allegion at inception including:

•	Reviewed and approved compensation and benefit disclosures in Form 10 filings for Allegion.

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(a)	Multiple metrics that measure actual annual Sector (Segment, beginning in 2014) and/or Enterprise financial performance against pre-established objectives (through our AIM program);

(b)	EPS growth and TSR over a three-year period relative to companies in the S&P 500 Industrials Index (through our PSP program);

(d)

Each NEO’s demonstrated ability to achieve Company financial objectives, develop and carry out strategic initiatives, contribute to both the growth and operational excellence of the Company and lead in a way that is consistent with our core competencies: modeling our values, inspiring our people, focusing on our customers, creating long-term value for our shareholders and delivering premier performance.

•	the direct analysis of the proxy statements of other diversified industrial companies (refer to peer group below),

•	a review of compensation survey data of other industrial companies of similar size published by independent consulting firms,

•	a review of customized compensation survey data provided by independent consulting firms, and

•	feedback received from external constituencies.

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•	Adopted a claw-back/recoupment policy. Our current policy will be revised, if necessary, to comply with the requirements of the Dodd-Frank Act when the final regulations are issued;

•	Incorporated provisions in the 2007 and 2013 Incentive Stock Plans to replace full payout at target of outstanding PSP awards in the event of a Change in Control of the Company with prorated PSP payout at target based on the point in the performance period when the Change in Control occurs; and

•	Closed the Elected Officer Supplemental Program (“EOSP”) to new participants effective April 30, 2011.

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•	Mr. Lamach received a 4.2% combined merit and market adjustment to continue to align his pay with his role and responsibilities as CEO;

•	Mr. Michel received a merit increase of 3.0%;

•	Mr. Teirlinck received a 3.4% merit increase in April 2013 and an 8.3% market adjustment in December in conjunction with his promotion to Executive Vice President, Climate;

•	Mr. Zafari received a 3.5% merit increase in April 2013 and an 11.9% market adjustment in December in conjunction with his promotion to Executive Vice President, Industrial;

•	Mr. Shawley received a merit increase of 2.9%; and

•	Mr. Conover received a merit increase of 3.2%.

(1)	Ms. Carter was first employed on September 27, 2013.

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•	Mr. Lamach: Leadership of the successful Spin-off; operational excellence measured by a growth in operating margin, deployment of core systems and the improvement of functional excellence; implement a capital allocation strategy to effectively balance shareholder distributions with strategic growth; and, improve leadership effectiveness, succession bench strength and employee engagement.

•	Ms. Carter: Efficient transition in the Chief Financial Officer role; effective oversight of the 2014 financial planning process; leadership of the financial restructuring of the company; and development of relationships with analysts and investors.

•	Mr. Michel: Increase customer satisfaction ratings; grow the business; leadership of the successful spin-off of the residential security businesses including cost management of the conversion and retention of key talent; increase

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•	Mr. Teirlinck: Deliver organic growth through the implementation of portfolio management and growth programs; develop and deploy a product management excellence program; implement technology improvements and support trading hubs, and improve employee engagement.

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Mr. Zafari: Enhance global integrated supply chain footprint and processes to deliver sustainable cash flow and customer satisfaction improvements; deliver organic growth through implementation of portfolio/channel management; develop and deploy product management excellence program with greater emphasis on the innovation of both products and services; pursue acquisition and divestiture strategy to accelerate growth in focused areas; foster margin expansion in Latin America, and deliver greater capability and decision making by focusing on the customer and standard work, delivered at lower cost.

•	Mr. Shawley: Financial leadership in the successful Spin-off; execution of tax planning strategies and the share repurchase program; improve employee engagement and retain key leadership talent; and lead the function toward a progressive, diverse and inclusive culture.

•	Mr. Conover: Leadership of the successful spin-off of the security businesses including cost management of the conversion; flow improvements through a focus on innovation revenue and emerging markets; and continued progress on operational excellence path.

(1)	Reflects an individual performance score of 106.34% for Mr. Lamach; 100% for Ms. Carter, and 100 % for Mr. Shawley. In addition, Mr. Shawley’s award was prorated to take into consideration his retirement date of November 30, 2013.

(2)

Ms. Carter’s 2013 target AIM was set at $175,000 to reflect her September 27, 2013 start date. In addition to this AIM award, Ms. Carter’s offer letter provides for March 2014 cash payments of $375,000 to offset forfeited 2013 annual incentive from her prior employer and $585,000 to offset the forfeited value of performance shares from her prior employer which were scheduled to be earned and delivered in 2014.

(3)	Mr. Michel’s financial score is 50% weighted on achievement of Residential Solutions metrics and 50% weighted on achievement of enterprise-wide metrics. Mr. Michel’s individual performance score was 100%.

(4)	Mr. Teirlinck’s financial score is 50% weighted on achievement of Climate Solutions metrics and 50% weighted on achievement of enterprise-wide metrics. Mr. Teirlinck’s individual performance score was 100%. Mr. Teirlinck’s target was prorated to reflect a base salary of $605,000 through November 30, 2013 and a base salary of $655,000 from December 1, 2013 through December 31, 2013.

(5)	Mr. Zafari’s financial score is 50% weighted on achievement of Industrial Technologies metrics and 50% weighted on achievement of enterprise-wide metrics. Mr. Zafari’s individual performance score was 100%. Mr. Zafari’s target was prorated to reflect a base salary of $491,500 through November 30, 2013 and a base salary of $550,000 from December 1, 2013 through December 31, 2013.

(6)

Mr. Conover’s financial score is 50% weighted on achievement of Security Technologies metrics and 50% weighted on achievement of enterprise-wide metrics. Mr. Conover’s individual performance score was 100%. In addition, Mr. Conover’s award was prorated to take into consideration his retirement date of November 5, 2013. This AIM amount was paid as part of Mr. Conover’s severance in accordance with the terms of the Major Restructuring Severance Plan.

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(a)

Ms. Carter joined Ingersoll Rand on September 27, 2013 and did not receive an annual equity award. In conjunction with her offer, on October 1, 2013, she was granted equity awards to partially offset the value of forfeited equity awards from her prior employer. These replacement awards include stock options with a value of $65,000, RSUs with a value of $960,000 and prorated PSU grants with a grant date target value of $410,000 for the 2012-2014 performance period and a grant date target value of $725,000 for the 2013-2015 performance period.

(b)	With their retirements in 2013, both Messrs. Shawley and Conover will be eligible to receive a pro-rated portion of the PSU awards based on time worked prior to their retirement date.

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(a)	Messrs. Shawley and Conover retired prior to 2014, therefore there are no salary adjustments shown for them. Messrs. Teirlinck and Zafari received a market adjustment as well as a merit increase in December 2013 to take into consideration their promotions to Executive Vice Presidents under the new reorganized structure.

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(a)	Pursuant to the EDCP Plans, a portion of a participant’s annual salary may be deferred into a number of investment options. In 2013 there were no salary deferrals by any NEO into the EDCP Plans.

(b)

Completion recognition bonuses were awarded in December, 2013 to certain individuals, including Messrs. Lamach and Shawley, whose contributions were critical to the successful completion of the Spin-off. Ms. Carter, as part of her employment offer, received a cash payment of $960,000 for the bonus and performance share plan payments forfeited at her prior employer. In the event Ms. Carter voluntarily leaves the company within two years of her hire date, she would have to repay this amount to the Company.

(c)

The amounts in this column reflect the aggregate grant date fair value of PSU awards and any RSU awards granted for the year under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718 and do not reflect amounts paid to or realized by the NEOs. In determining the aggregate grant date fair value of the PSU awards, the awards are valued assuming target level performance achievement. If the maximum level performance achievement is assumed, the aggregate grant date fair value of the PSU awards would be as follows:

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(d)

The amounts in this column reflect the aggregate grant date fair value of stock option grants for financial reporting purposes for the year under ASC 718 and do not reflect amounts paid to or realized by the NEOs. For a discussion of the assumptions made in determining the ASC 718 values see Note 12, “Share-Based Compensation,” to the Company’s consolidated financial statements contained in its 2013 Form 10-K.

(e)	This column reflects the amounts earned as annual awards under the AIM program. Unless deferred into the EDCP Plans, AIM program payments are made in cash. In 2013, there were no AIM deferrals by any NEO into the EDCP Plans. Amounts shown in this column are not reduced to reflect deferrals of AIM awards into the EDCP Plans.

(f)

Amounts reported in this column reflect the aggregate increase in the actuarial present value of the benefits under the qualified Ingersoll Rand Pension Plan Number One (the “Pension Plan”), Supplemental Pension Plans, Key Management Supplemental Pension Plan (the “KMP”) and EOSP, as applicable. The change in pension benefits value is attributable to the additional year of service and age, the annual AIM award and any annual salary increase. Amounts are higher for those NEOs who are older and closer to retirement than for those who are younger and further from retirement since the period over which the benefit is discounted to determine its present value is shorter and the impact of discounting is therefore reduced.

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(2)	For Messrs. Michel and Shawley, represents the estimated year-over-year increase in the value of the retiree medical plan, calculated based on the methods used for financial statement reporting purposes. For Mr. Conover, represents the value allocated by the company in 2013 to a retiree medical subsidy account available to certain former employees of Trane.

(3)

The amount for Mr. Lamach represents tax equalization payments related to Irish taxes owed on $270,000, which is the portion of his income that is allocated to his role as a director of the Company. Without these payments, Mr. Lamach would be subject to double taxation on this amount since he is already paying U.S. taxes on this income. The amount for (i) Ms. Carter represents payments made on her behalf for taxes related to relocation costs; (ii) Mr. Zafari represent payments of taxes on his behalf related to Company contributions made to the Belgium social scheme and (iii) Mr. Teirlinck represent payments of taxes on his behalf related to Company contributions made to the Belgium social scheme and an additional payment in the amount of $86,343 to compensate him for U.S. income tax and applicable gross-up relative to stock options exercised in 2013 for which Mr. Teirlinck had previously paid taxes in Belgium upon the grant of those stock options in 2008. Without this payment Mr. Teirlinck would be subject to double taxation.

(4)

Represents: (i) the incremental cost to the Company of personal use of the Company aircraft by the CEO. For security and safety reasons and to maximize his availability for Company business, the Board of Directors requires the CEO to travel on Company-provided aircraft for business and personal purposes, unless commercial travel is deemed a minimal security risk by the Company. The incremental cost to the Company of personal use of the Company aircraft is calculated based on the hourly average variable operating costs to the Company. Variable operating costs include fuel, maintenance, on-board catering and landing fees. The hourly average variable cost is multiplied by the amount of time flown for personal use to derive the incremental cost. The methodology excludes fixed costs that do not change based on usage, such as pilots’ and other employees’ salaries, management fees and training, hangar and insurance expenses. We impose an annual limit of $150,000 on the CEO’s non-business use of Company-provided aircraft. For 2013, the amount for Mr. Lamach includes $150,000 for personal use of Company-provided aircraft; (ii) the following cost for relocation costs, including costs related to the sale of a prior residence, for Ms. Carter, $337,072; (iii) the following incremental cost of the Company-leased cars, calculated based on the lease, insurance, fuel and maintenance costs to the Company: Mr. Lamach, $9,915; Mr. Michel, $15,812; Mr. Teirlinck, $14,448; Mr. Zafari, $16,835; Mr. Shawley, $7,790; and Mr. Conover, $65,646 (includes the resale value of Mr. Conover’s company vehicle ($46,315) which was given to him upon his retirement); (iv) additional incremental costs associated with the use of the Company aircraft. Under the Company’s aircraft use policy, the Compensation Committee has determined that business use includes travel that is related to the Company’s business or benefits the Company, such as travel to meetings of other boards on which the CEO sits. For 2013, the amount for Mr. Lamach includes $48,180 for such business-related travel; (v) the following costs for financial counseling services, which may include tax preparation and estate planning services: Mr. Lamach, $7,032; Mr. Michel, $2,839; Mr. Teirlinck, $9,981; Mr. Zafari, $10,620; Mr. Shawley, $9,000; and Mr. Conover, $3,686; (vi) the following costs for medical services provided through an on-site physician under the Executive Health Program: Mr. Lamach, $1,600; Ms. Carter, $2,073; Mr. Michel, $3,109; Mr. Teirlinck, $1,813; Mr. Zafari, $3,446; Mr. Shawley, $1,412; and Mr. Conover, $3,987; (vii) the payments of $15,653 and $3,913 to permit Messrs. Teirlinck and Zafari to remain covered under the Belgium social scheme and have access to the country’s health plan should they return to Europe.

(5)	Represents payments made or accrued to Mr. Conover in connection with his leaving the Company. For further information, see “Post-Employment Benefits” below.

(h)	Mr. Conover received the equivalent of his pro-rated AIM award as part of his severance. For further information, see “Post-Employment Benefits” below.

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(a)

The target award levels established for the AIM program are established annually in February and are expressed as a percentage of the NEO’s base salary. Refer to Compensation Discussion and Analysis under the heading “Annual Incentive Matrix Program” for a description of the Compensation Committee’s process for establishing AIM program target award levels. The amounts reflected in the “Estimated Future Payouts Under Non-Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for awards under the AIM program that were paid in March 2014, based on performance in 2013. Thus, the amounts shown in the “threshold, target and maximum” columns reflect the range of potential payouts when the target award levels were established in February 2013 for all NEOs other than Ms. Carter (Ms. Carter’s target award was established upon her hire in September 2013). The AIM program pays $0 for performance below threshold. The actual amounts paid pursuant to those awards are reflected in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table.

(b)

The amounts reflected in the “Estimated Future Payouts Under Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for PSU awards. The PSP pays $0 for performance below threshold. For a description of the Compensation Committee’s process for establishing PSP target award levels and the terms of PSU awards, please refer to Compensation Discussion and Analysis under the heading “Long-Term Incentive Program” and the “Post-Employment Benefits” section below. Awards made prior to 2013 are included to the extent that there was incremental value adjustments in 2013 as a result of the Spin-off as further discussed in footnote (f) below.

(c)

The amounts in these columns reflect the stock option and RSU awards. Awards in 2013 were granted in February 2013, except for awards to Ms. Carter which were made in October 2013, and RSU awards granted to Mr. Michel, Mr. Teirlinck and Mr. Zafari in December 2013. For a description of the Compensation Committee’s process for determining stock option and RSU awards and the terms of such awards, see Compensation Discussion and Analysis under the heading “Long-Term Incentive Program” and the “Post-Employment Benefits” section below. Awards made prior to 2013 are included to the extent that there was incremental value adjustments in 2013 as a result of the Spin-off as further discussed in footnote (f) below.

(d)

Stock options were granted under the Company’s Incentive Stock Plan of 2007 (the “2007 Plan”) or its Incentive Stock Plan of 2013 (the “2013 Plan”), which requires options to be granted at an exercise price equal to the fair market value of the Company’s ordinary shares on the date of grant. The fair market value is defined in the 2007 Plan and the 2013 Plan as the average of the high and low trading price of the Company’s ordinary shares listed on the NYSE on the grant date. The closing price on the NYSE of the Company’s ordinary shares was $52.61 on the February 2013 grant date. The closing price for Ms. Carter’s awards was $65.17 on the October 2013 grant date.

(e)

Amounts in this column include the grant date fair value of the equity awards, as well as the incremental fair value for awards that were modified during fiscal 2013 (see footnote (f)), calculated in accordance with ASC 718. The Company cautions that the actual amount ultimately realized by each NEO from the stock option awards will likely vary based on a number of factors, including stock price fluctuations, differences from the valuation assumptions used and timing of exercise or applicable vesting.

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(f)

In connection with the Spin-off, certain adjustments were made to outstanding equity awards held by our employees, including the NEOs as described in the narrative disclosure preceding the “Outstanding Equity Awards at December 31, 2013” table. The adjustments were designed to preserve the intrinsic value of each form of equity award. Although these adjustments were intended to preserve the intrinsic value of each type of award, in some cases, they constituted a modification under ASC Topic 718, which requires a comparison of fair values immediately before and after the Spin-off. In certain instances, the fair value of the equity awards calculated in accordance with ASC 718 immediately after the Spin-off was higher. As a result, the adjustment resulted in incremental compensation costs for these awards which are reported in this column.

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Vested and exercisable stock options and SARs were adjusted such that the holder of such awards was also afforded the right to options in the number of shares of Allegion that he or she would have received had the ordinary shares of the Company subject to the vested and exercisable stock options and SARs been outstanding shares as of the record date for the Spin-off. The aggregate exercise price of the stock options and SARs was allocated between the adjusted awards in shares of the Company and Allegion in order to preserve the intrinsic value of the awards immediately before and after the Spin-off.

•	Unvested stock options were adjusted wholly into stock options in the ordinary shares of the Company such that the number of shares and the exercise price of the options were adjusted to preserve their intrinsic value based on the value of the shares immediately before and after the Spin-off.

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PSUs and RSUs were adjusted such that the number of ordinary shares of the Company subject to the PSU and RSU awards was adjusted based on the value of the shares immediately before and after the Spin-off to preserve their intrinsic value. In addition, with respect to the PSU performance metrics, for purposes of calculating EPS growth, 2013 EPS was calculated as the combined 2013 full year reported EPS for the Company and Allegion; for purposes of calculating TSR in the outstanding award cycles, the stock price of Allegion immediately after the Spin-off, adjusted for the distribution ratio of 1 share of Allegion for every 3 shares of the Company, will be treated as a dividend.

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(a)	These columns represent stock option and SARs awards. Except as noted in (b) below, these awards generally become exercisable in three equal installments beginning on the first anniversary after the date of grant, subject to continued employment or retirement.

(b)	Mr. Shawley’s grant dated June 4, 2008 vests and becomes exercisable 50% on each of the fourth and sixth anniversaries of February 15, 2008. Ms. Carter’s option grant dated October 1, 2013, vests and becomes exercisable on the 3rd anniversary of the grant date.

(c)	All of the options granted to the NEOs expire on the tenth anniversary (less one day) of the grant date other than the February 5, 2007 grant to Mr. Conover which expires on the tenth anniversary of the grant date.

(d)

This column represents unvested RSUs. Except as described in the following sentence, RSUs generally become exercisable in three equal installments beginning on the first anniversary after the date of grant, subject to continued employment or retirement. In the case of Ms. Carter’s grant dated October 1, 2013 and Messrs. Zafari and Teirlinck’s grants dated December 6, 2013, 100% of the grant vests on the third anniversary of the grant date.

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(e)	The market value was computed based on $61.60, the closing market price of the Company’s ordinary shares on the NYSE at December 31, 2013.

(f)	This column represents unvested and unearned PSUs. PSUs vest upon the completion of a three-year performance period. The actual number of shares an NEO will receive, if any, is subject to achievement of the performance goals as certified by the Compensation Committee, and continued employment.

•	Mr. Lamach received 225,578 options to purchase Allegion common stock with exercise prices ranging from $19.4573 to $29.1189, all of which were vested as of December 1, 2013;

•	Mr. Shawley received 72,274 options to purchase Allegion common stock with exercise prices ranging from $19.4574 to $29.1177, all of which were vested as of December 1, 2013;

•	Mr. Conover received 36,634 options to purchase Allegion common stock with exercise prices ranging from $19.4560 to $32.3483, all of which were vested as of December 1, 2013;

•	Mr. Michel received 10,287 options to purchase Allegion common stock with exercise prices ranging from $24.0019 to $29.1191, all of which were vested as of December 1, 2013; and

•	Mr. Zafari received 24,099 options to purchase Allegion common stock with exercise prices ranging from $10.4023 to $29.1191, all of which were vested as of December 1, 2013.

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(a)

This column reflects the aggregate dollar amount realized by the NEO upon the exercise of the stock options and SARs by determining the difference between (i) for stock options, the market price of the Company’s ordinary shares at exercise and the exercise price of the stock options or (ii) for SARs, the opening price of the Company’s ordinary shares on the date of exercise and the exercise price of the SARs.

(b)	Reflects the value of the RSUs that vested on February 24, 2013 and PSUs that vested on February 22, 2013, based on the average of the high and low stock price of the Company’s ordinary shares on the vesting date.

(c)	Reflects the value of the RSUs that vested on February 14, 2013, February 16, 2013, February 24, 2013 and August 5, 2013 and PSUs that vested on February 22, 2013 based on the average of the high and low stock price of the Company’s ordinary shares on the vesting date.

(d)	Reflects the value of the RSUs that vested on February 14, 2013, February 16, 2013 and February 24, 2013 and PSUs that vested on February 22, 2013 (other than with respect to shares that were deferred as described in footnote (e) below), based on the average of the high and low stock price of the Company’s ordinary shares on the vesting date.

(e)

Messrs. Teirlinck, Shawley and Conover elected to defer all or a portion of the shares acquired upon the vesting of their PSU awards on February 22, 2013 into the Company’s EDCP II. Mr. Teirlinck deferred 37,795 shares having a value of $1,988,017, Mr. Shawley deferred 58,268 shares having a value of $3,064,897, and Mr. Conover deferred 5,040 shares having a value of $265,104. Messrs. Teirlinck, Shawley and Conover’s cash dividends of $51,023, $78,662 and

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(a)

Under the EOSP or the KMP, for officers covered prior to May 19, 2009, a full year of service is credited for any year in which they work at least one day. In the Pension Plan, the Supplemental Pension Plans, the EOSP and the KMP for officers covered on or after May 19, 2009, the number of years of credited service is based on elapsed time (i.e. , credit is given for each month in which a participant works at least one day). Years of credited service is not used in the determination of the present value of benefits for the Trane Pension Plan. The Supplemental Pension Plan II was established as a mirror plan of the Supplemental Pension Plan, except for provisions required by Section 409A of the Code, effective January 1, 2005. The years of credited service used for calculating benefits under (i) the Supplemental Pension Plan I are the years of credited service through December 31, 2004, and (ii) the Pension Plan, EOSP, KMP and Supplemental Pension Plan II are the years of credited service through December 31, 2013. The benefits earned under the Supplemental Pension Plan I serve as offsets to the benefits earned under the Supplemental Pension Plan II.

(b)

The amounts in this column reflect the estimated present value of each NEO’s accumulated benefit under the plans indicated. The calculations reflect the value of the benefits assuming that each NEO was fully vested under each plan. The benefits were computed as of December 31, 2013, consistent with the assumptions described in Note10, “Pensions and Postretirement Benefits Other than Pensions,” to the consolidated financial statements in the 2013 Form 10-K.

(c)	The amounts shown represent the actual distributions that were made to Messrs. Shawley and Conover in December 2013. For Mr. Shawley, there is also an annuity component of the Pension Plan and the amount he received in annuity payments during 2013 is also included in this value.

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(d)	Mr. Lamach’s credited years of service exceed his actual years of service by 17 years pursuant to the provisions of his employment arrangement. The increase in present value of benefits due to those additional years of credited service is $9,599,502. Mr. Lamach’s benefit is reduced by the pension benefit he received from his former employer in July 2013, updated with interest.

(e)	Service in the Pension Plan and the Supplemental Pension Plan II for Messrs. Teirlinck and Zafari began in September 2008 and August 2010, respectively, when they transferred to the United States. Service in the Pension Plan and the Supplemental Pension Plan II for Mr. Conover began in January 2010, when former Trane employees became eligible to participate in these plans.

(f)

Benefits for Messrs. Teirlinck and Zafari under the EOSP use all their service with the Company, not just the service in the United States. The benefit will be reduced by any and all benefits accrued or accumulated while covered under any non-U.S. plan in respect to any period of service that is counted as a year of service in this plan. The value of these non-U.S. benefits is not readily accessible until retirement, and therefore the amount shown for EOSP reflects the value of this benefit prior to these reductions.

(h)	Under the provisions of the EOSP, Mr. Shawley’s service is capped at 35 years. Mr. Conover’s service in the EOSP began in June 2008, the date of the Trane acquisition.

(i)	These amounts represent the actual distributions that will be made to Messrs. Shawley and Conover in June 2014, including the interest that will accrue on the benefits between their dates of retirement and their dates of payment.

(j)	On June 4, 2008, the Compensation Committee of the Board of Directors agreed that if Mr. Shawley remains with the Company until age 60, any reduction for early retirement will be waived. The increase in present value of benefits resulting from this provision is $907,649.

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(a)	The annual deferrals (salary, AIM & PSP) are all reflected in the Salary column, the Non-Equity Incentive Plan column and the Stock Awards column, respectively of the Summary Compensation Table.

(b)	All of the amounts reflected in this column are included in the All Other Compensation column of the Summary Compensation Table.

(c)	Amounts in this column include gains and losses on investments, as well as dividends on ordinary shares or ordinary share equivalents. None of the earnings or losses reported in this column are included in the Summary Compensation Table.

(d)

The following table reflects the amounts reported in this column previously reported as compensation to the NEOs in the Company’s Summary Compensation Table in proxy statements for prior years. Each of Messrs. Lamach, Michel, Teirlinck, Zafari and Shawley first became NEOs and therefore had their compensation reported in the Company’s proxy statements for fiscal years 2005 (Lamach), 2007 (Shawley), 2010 (Teirlinck) and 2013 (Michel), 2012 (Zafari). Mr. Conover and Ms. Carter first became NEOs in 2013 and therefore no previous compensation was reported in the Company’s prior proxy statements.

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•	retirement, RSUs and stock options continue to vest on the same basis as active employees and the stock options remain exercisable for a period of three years (or five years in the case of retirement for awards granted in 2007 and after) following termination;

•	group termination, RSUs and stock options immediately vest in the portion of the awards that would have vested within twelve months of termination and all vested stock options remain exercisable for a period of three years following termination;

•

death or disability, RSUs and stock options either vest or continue to vest on the same basis as active employees and the stock options remain exercisable for a period of three years following termination and PSUs vest pro-rata based on the time worked during the performance period and the achievement of performance goals from the beginning of the performance period through the end of the calendar quarter in which employment terminated; and

•	retirement, group termination or job elimination, PSUs vest pro-rata based on the time worked during the performance period and the achievement of performance goals through the end of the performance period.

•	any base salary and annual bonus for a completed fiscal year that had not been paid;

•	an amount equal to the NEO’s annual bonus for the last completed fiscal year pro-rated for the number of full months employed in the current fiscal year;

•	an amount equal to the NEO’s base salary pro-rated for any unused vacation days;

•	a lump sum severance payment from the Company equal to the three times (for the CEO) or two and one-half times (for other NEOs) the sum of:

•	the NEO’s annual salary in effect on the termination date, or, if higher, the annual salary in effect immediately prior to the reduction of the NEO’s annual salary after the change in control; and

•	the NEO’s target AIM award for the year of termination or, if higher, the average of the AIM award amounts beginning three years immediately preceding the change in control and ending on the termination date; and

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•

for Messrs. Lamach and Teirlinck, a lump sum payment equal to three times for Mr. Lamach and two and one-half times for Mr. Teirlinck of: (a) the cash value of the target amount of the most recent PSU award; or (b) if higher, the average amounts of the last three PSU awards granted and paid to the NEO immediately preceding termination. This payment is in lieu of any rights the individual might have with respect to unvested PSU awards.

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(a)	For the “Involuntary without Cause” column, for those NEOs who do not have a formal separation agreement, the current severance guidelines permit payment of up to one year’s base salary. For the amounts shown under the “Change in Control” columns, refer to the description of how severance is calculated in the section above, entitled Post-Employment Benefits.

(b)

For the “Involuntary without Cause” column, these amounts represent the (i) AIM award earned by Mr. Lamach in 2013 and paid pursuant to the terms of his employment agreement and (ii) prorated AIM award (up to target) earned by Ms. Carter in 2013 and (iii) prorated AIM awards (up to target) that may be paid to the other NEOs depending on the circumstances and timing of the termination. For the amounts under “Change in Control,” these amounts represent the actual award earned for the 2013 performance period, which may be more or less than the target award.

(c)

For the “Involuntary without Cause” column, these amounts represent the cash value of the prorated PSU award payout to (i) Mr. Lamach pursuant to the terms of his employment agreement and (ii) Messrs. Teirlinck and Zafari because they were retirement eligible at December 31, 2013. For the “Change in Control” column for Messrs. Lamach and Teirlinck, these amounts represent the cash value of the PSU award payout, based on the appropriate multiple. For the “Change in Control” column for Messrs. Michel and Zafari and Ms. Carter, these values represent what would be provided under the terms of the 2007 Plan and 2013 Plan, which provide a pro-rated payment for all outstanding awards at target. For the “Retirement,” “Disability” and “Death” columns, amounts represent the cash value of the prorated portion of their PSUs that vest upon such events assuming performance at target. Amounts for each column are based on the closing stock price of the ordinary shares on December 31, 2013 ($61.60).

(d)

The amounts shown for “Retirement,” “Involuntary without Cause,” “Change in Control,” “Death” and “Disability” represent (i) the value of the unvested RSUs, which is calculated based on the number of unvested RSUs multiplied by the closing stock price of the ordinary shares on December 31, 2013 ($61.60), and (ii) the intrinsic value of the unvested stock options and SARs, which is calculated based on the difference between the closing stock price of the ordinary shares on December 31, 2013 ($61.60) and the relevant exercise price. However, only in the event of termination following a “Change in Control” or, beginning with the 2013 awards, termination due to death or disability is there accelerated vesting of unvested awards. In addition, in the event of a “Change in Control,” holders of outstanding stock options and SARs under the Stock Incentive Plan of 1998 may elect to receive a cash payment based on the difference between the highest fair market value of the shares during the 60 days prior to the event ($71.335) and the exercise price. For “Retirement,” “Disability” (before 2013 grant) and “Death” (before 2013 grant), the awards do not accelerate but continue to vest on the same basis as active employees. Because Messrs. Teirlinck and Zafari were retirement eligible, they would continue to vest in stock options and RSUs after termination of employment for any reason other than cause.

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(e)

In the event of a change in control of the Company and a termination of the NEOs, the present value of the pension benefits under the EOSP, KMP and Supplemental Pension Plans would be paid out as lump sums. While there is no additional benefit to the NEOs as a result of either voluntary retirement/resignation and/or involuntary resignation without cause, there are differences (based on the methodology mandated by the SEC) between the numbers that are shown in the Pension Benefits Table and those that would actually be payable to the NEO under these termination scenarios.

(f)	For the “Involuntary without Cause” column, each NEO is eligible for outplacement services for a twelve month period, not to exceed $13,400. For the “Change in Control” column, the amount represents the maximum expenses the Company would reimburse the NEO for professional outplacement services.

(g)	Pursuant to the change-in-control agreements for Messrs. Lamach and Teirlinck, if any payment or distribution by the Company to these NEOs creates certain incremental taxes, they would be entitled to receive from the Company a payment in an amount sufficient to place them in the same after-tax financial position as if such taxes had not been imposed.

(h)	Represents the Company cost of health and welfare coverage. The cost for “Change in Control” represents continued active coverage for the severance period. For Mr. Michel, the value shown includes the cost for retiree coverage.

•	$2,186,578 representing the sum of two times his base salary plus his AIM target as well as the value of his prorated AIM award for the 2013 performance cycle;

•	$1,374,775 representing the cash value of his prorated PSU award payout because he was retirement eligible at the time of his termination date of November 5, 2013;

•	$691,742 representing the value of his unvested RSUs as of November 5, 2013 which continue to vest due to his retirement; and

•	$739,479 representing the value of the acceleration of his unvested stock options which became fully vested and exercisable at his termination date.

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(a)

Represents (i) ordinary shares held directly; (ii) ordinary shares held indirectly through a trust; (iii) unvested shares, including any RSUs or PSUs, and ordinary shares and ordinary share equivalents notionally held under the Trane Deferred Compensation Plan (the “TDCP”) that may vest or are distributable within 60 days of the Record Date; and (iv) ordinary shares held by the trustee under the ESP for the benefit of executive officers. Other than Mr. Peltz, no director or executive officer of the Company beneficially owns 1% or more of the Company’s ordinary shares. Mr. Peltz beneficially owns 6.37% of the Company’s ordinary shares.

(b)

Represents ordinary shares and ordinary share equivalents notionally held under the Ingersoll Rand Directors Deferred Compensation Plan (the “DDCP I”) and the Ingersoll Rand Directors Deferred Compensation and Stock Award Plan II (the “DDCP II” and, together with the DDCP I, referred to as the “DDCP Plans”), the EDCP Plans, the TDCP and the Company’s stock grant plan that are not distributable within 60 days of the Record Date.

(c)	Represents ordinary shares as to which directors and executive officers had stock options or SARs exercisable within 60 days of the Record Date, under the Company’s Incentive Stock Plans. For Mr. Peltz, represents ordinary shares that may be acquired pursuant to put-call options.

(d)

Includes a director's grant of 2,382 RSUs to Mr. Peltz under the 2013 Plan and 11,977,676 ordinary shares beneficially owned by both Trian, 280 Park Avenue, 41st Floor, New York, NY 10017, in its capacity as the management company for certain funds and investment vehicles managed by it and Nelson Peltz. Trian Fund Management GP, LLC (“Trian GP”), which is controlled by Nelson Peltz, Peter W. May and Edward P. Garden, is the general partner of Trian. All of the shares are held with shared dispositive power and voting power by Trian, Trian GP, Mr. Peltz, Mr. May and Mr. Garden.

(e)

The Company’s ordinary shares beneficially owned by all directors and executive officers as a group (including shares issuable under exercisable options) aggregated approximately 7.11% of the total outstanding ordinary shares. Ordinary shares and ordinary share equivalents notionally held under the DDCP Plans, the EDCP Plans and the TDCP and ordinary share equivalents resulting from dividends on deferred stock awards are not counted as outstanding shares in calculating these percentages because they are

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(a)	The ownership percentages set forth in this column are based on the Company’s outstanding ordinary shares on the Record Date and assumes that each of the beneficial owners continued to own the number of shares reflected in the table above on such date.

(b)	Information regarding BlackRock, Inc. and its stockholdings was obtained from a Schedule 13G filed with the SEC on February 11, 2014. The filing indicated that, as of December 31, 2013, BlackRock, Inc. had sole voting power as to 13,535,853 of such shares and sole dispositive power as to 17,959,791 of such shares.

(c)

Information regarding Trian and its stockholdings was obtained from the Schedule 13D (Amendment No. 4) filed with the SEC on November 18, 2013 and joint Form 4s filed by Nelson Peltz and Trian Fund Management, L.P. on November 20, 2013 and February 27, 2014. According to the Schedule 13D (Amendment No. 4), Trian Fund Management, L.P. shares voting and dispositive power over all or some of the shares with Trian Partners, L.P., Trian Partners Master Fund, L.P., Trian Partners Parallel Fund I, L.P., Trian Partners Strategic Investment Fund, L.P., Trian Partners Strategic Investment Fund-A, L.P., Trian Partners Strategic Co-Investment Fund-A, L.P., Trian Partners Master Fund (ERISA), L.P., Trian Fund Management GP, LLC, Trian SPV (SUB) VI, L.P., Trian SPV (SUB) VI-A, L.P., Trian IR Holdco Ltd., Nelson Peltz, Peter W. May and Edward P. Garden.

(1)	Consists of the Incentive Stock Plan of 1998, the 2007 Plan, the 2013 Plan and the Trane 2002 Omnibus Incentive Plan.

(2)	Consists of EDCP Plans, DDCP Plans and the TDCP. Plan participants acquire Company shares under these plans as a result of the deferral of salary, AIM awards and PSUs.

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