Stock Option Award Agreement

 

Exhibit 10(M)

STOCK OPTION AWARD AGREEMENT

THIS AGREEMENT CONSTITUTES PART OF THE PROSPECTUS COVERING SECURITIES REGISTERED UNDER THESECURITIES ACT OF 1933.

     THISSTOCK OPTION AWARD AGREEMENT (hereinafter, the “Agreement”) is made as of this ______ day of____________, ______, by and between Goodrich Corporation, a New York corporation (the “Company”),and ____________ (the “Optionee”). For the purposes of this Agreement, all capitalized terms notdefined herein shall have the meanings ascribed thereto under the terms of the Goodrich Corporation2001 Stock Option Plan (as amended, the “Plan”), unless otherwise noted.

     WHEREAS, Optionee is employed by the Company or its subsidiary corporations, as defined in thePlan; and

     WHEREAS, the Company wishes to grant to Optionee an award of stock options under the Plan,subject to the conditions and restrictions set forth in the Plan and this Agreement.

     NOW THEREFORE, in consideration of the mutual covenants contained in this agreement, theparties agree as follows:

     1. Grantof Options. The Committee has granted to Optionee as of ____________ (the“Grant Date”), ______ [Number] options to purchase shares of common stock, par value $5.00 pershare, of the Company (“Common Stock”), upon the terms and conditions set forth in this Agreementand the Plan. The options granted under this Agreement are intended to be non-statutory stockoptions.

     2. Exercise Price. The exercise price of the shares of Common Stock covered by theoption shall be ______ per share. This option price represents 100% of the fair market value ofthe Common Stock on the date of grant, as calculated under the Plan.

     3. Term of Option. The term of the options shall be ten (10) years from the datehereof, subject to earlier termination as provided in this Section 3. The date which is ten (10)years after the Grant Date shall be termed the “Expiration Date”.

     4. Vesting of Options. The options granted hereunder will be deemed vested uponOptionee’s continued employment with the Company or one of the Company’s subsidiary corporations onthe dates set forth in the following schedule:

     
One (1) year from the Grant Date hereof
  33 1/3 % of the options
Two (2) years from the Grant Date hereof
  66 2/3 % of the options
Three (3) years from the Grant Date hereof
  100 % of the options

     5. Post-Employment Exercise of Options.

     (a) If Optionee’s employment with the Company or a subsidiary corporation terminates prior tothe Expiration Date, and at such time the Optionee is eligible for retirement at the NormalRetirement Date or later, as defined in the Goodrich Corporation Employees’ Pension Plan (or asdefined in a subsidiary

 


 

company’s salaried pension plan in the event Optionee’s pension benefits are received solelyfrom the subsidiary’s plan) in effect at the time of Optionee’s termination of employment, then allunvested options shall vest immediately upon such termination and Optionee’s privilege to purchaseshares may be exercised by Optionee at any time but in no event later than either the date which isfive (5) years after the date Optionee’s employment with the Company terminates or the ExpirationDate, whichever occurs first, and thereafter shall terminate.

     (b) If Optionee’s employment with the Company or a subsidiary corporation terminates prior tothe Expiration Date, and at such time the Optionee is eligible for early retirement but has not yetreached the Optionee’s Normal Retirement Date, as such terms are defined in the GoodrichCorporation Employees’ Pension Plan (or as defined in a subsidiary company’s salaried pension planin the event Optionee’s pension benefits are received solely from the subsidiary’s plan) in effectat the time of Optionee’s termination of employment, then all unvested options shall continue tovest in accordance with Section 2 hereof, and Optionee’s privilege to purchase shares may beexercised by Optionee at any time but in no event later than either the date which is five (5)years after the date Optionee’s employment with the Company terminates or the Expiration Date,whichever occurs first, and thereafter shall terminate

     (c) If Optionee’s employment with the Company or a subsidiary corporation terminates prior tothe Expiration Date by reason of permanent and total disability, as determined on the basis ofmedical evidence satisfactory to the Company, then all unvested options shall vest immediately uponsuch termination and Optionee’s privilege to purchase shares may be exercised by Optionee at anytime but in no event later than either the date which is five (5) years after the date Optionee’semployment terminates or the Expiration Date, whichever occurs first, and thereafter shallterminate.

     (d) If Optionee’s employment with the Company or a subsidiary corporation terminates prior tothe Expiration Date by reason of death, then all unvested options shall vest immediately upon suchtermination and Optionee’s privilege to purchase shares may be exercised by Optionee’s executors oradministrators at any time but in no event later than either the date that is five (5) years afterthe date Optionee’s employment terminates or the Expiration Date, whichever occurs first, andthereafter shall terminate.

     (e) If Optionee’s employment with the Company or a subsidiary corporation terminates for anyreason other than death or permanent and total disability or at a time when Optionee is noteligible for retirement, in each case as referred to above in Sections 5 (a), (b) and (c), thenOptionee’s privilege to purchase shares pursuant to options that are vested as the date oftermination may be exercised by Optionee at any time within ninety (90) days of the termination ofOptionee’s employment, but in no event later than the Expiration Date, and thereafter shallterminate.

     (f) In the event of a Change in Control, the options granted under this Agreement shall vestimmediately upon such Change in Control and shall remain exercisable by Optionee until the earlierof (a) the date two years after the Change in Control effective date or (b) the Expiration Date.

     (g) Notwithstanding any provisions of this Agreement to the contrary, if Optionee’s employmentwith the Company or any of its subsidiary corporations is terminated for Cause, as defined herein,the Committee may, in its sole discretion, immediately terminate the options granted under thisAgreement. For the purpose of this Agreement, “Cause” shall mean a termination of employment by

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the Company due to (i) the commission by Optionee of an act of fraud or embezzlement againstthe Company or any of its subsidiary corporations, (ii) a conviction of Optionee (or a plea ofnolo contendere in lieu thereof) for any crime involving fraud, dishonesty or moralturpitude; or (iii) intentional violation by Optionee of written policies of the Company orspecific directions of the Board, which misconduct or violation results in material damage to theCompany and continues after written notice thereof and a reasonable opportunity to cure.

     6. Method of Exercising Option. The option hereby granted may be exercised at anytime as to all or any of the shares then purchasable in accordance with this Agreement by paymentin full therefor, at the corporate offices of the Company, either in (a) cash (including checks,bank draft money order or wire transfer) or (b) by delivering Common Stock owned of record byOptionee, or a combination of cash and Common Stock owned of record by Optionee. The fair marketvalue of the Common Stock so delivered shall be the arithmetic mean of the high and low price ofthe Common Stock on the New York Stock Exchange-Composite Transactions listing on the exercise date(as of 4:00 p.m. Eastern Time). The utilization of Common Stock for all or part of the optionprice shall be subject to rules and conditions issued by the Board or the Committee including butnot limited to common stock holding period requirements relating to pyramiding rules, regulations,principles and practices of the Internal Revenue Service, the Securities and Exchange Commissionand the accounting profession. Upon receipt of such payment and payment of any requiredwithholding taxes, the Company will issue, sell and deliver fully paid and nonassessable shares ofCommon Stock in the amount for which payment is so made. As soon as practicable after suchpayment, the Company shall either transfer physical possession of a certificate or certificatesrepresenting the shares of Common Stock so purchased or provide for book entry transfer of suchshares to the Optionee.

     7. Optionee’s Alternative to Exercising Options.

     (a) In the event of a Change in Control, and as an alternative to the exercise provisionscontained above, Optionee may under certain limited conditions hereinafter set forth, elect tosurrender and terminate the option granted herein as to all or any of the shares then purchasablein accordance with this Agreement and receive cash from the Company.

     (b) A written application containing an election to exercise this Section 7 alternative mustbe submitted to the Secretary of the Company, or his or her designee, during the period thatcommences on the date on which a Change in Control occurs and ends on the 60th day thereafter.

     (c) The amount of cash paid upon exercise of this Section 7 alternative shall equal the totalnumber of option shares surrendered multiplied by the amount by which the fair market value of ashare of the Company’s common stock on the date of exercise exceeds the option price. The fairmarket value of common stock, for purposes of this paragraph, shall be the arithmetic mean of thehigh and low prices of the common stock as reported on the New York Stock Exchange-CompositeTransactions listing (or similar report) on the exercise date (as of 4:00 p.m. Eastern Time) asdetermined in this Section 7(c), or, if no sale was made on such date, then on the next precedingday on which a sale was made.

     (d) This Section 7 alternative shall not be available more than six months after (i)Optionee’s retirement from the Company or one of its subsidiaries, or (ii) Optionee ceases to beconsidered an “executive officer” of the Company and therefore subject to Section 16(b) of theExchange Act.

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     8. Assignability. The rights of Optionee, contingent or otherwise, in the optionscannot and shall not be sold, assigned or pledged or otherwise transferred or encumbered other thanby will or by the laws of descent and distribution.

     9. Rights as a Shareholder. Neither Optionee nor his/her beneficiary or legalrepresentative shall be, or have any rights of, a shareholder of the Company or have any right tonotice of meetings of shareholders or of any other proceedings of the Company.

     10. Changes in Capital Structure. The number of options covered by this Agreement andthe exercise price thereof will be adjusted appropriately in the event of any stock split, stockdividend, combination of shares, merger, consolidation, reorganization, or other change in thenature of the shares of Common Stock in the same manner in which other outstanding shares of CommonStock are affected.

     11. Governing Law. This grant and exercise of this option is subject to the conditionthat this option, together with any other options granted on the Grant Date, will conform with anyapplicable provisions of any State or Federal law or regulation in force either at the time ofgrant of the option or the exercise thereof. The Committee and the Board reserve the rightpursuant to the condition mentioned in this paragraph to terminate all or a portion of this optionif, in the opinion of the Committee and the Board, this option or the exercise thereof does notconform with any such applicable State or Federal law or regulation and such nonconformance shallcause material harm to the Company.

     This Agreement is to be governed by the laws of the State of New York, without regard toconflicts of laws principles thereof.

     12. Tax Withholding. Optionee’s ability to exercise Optionee’s options and receivethe benefits of such exercise are contingent upon Optionee’s agreement that Optionee will remit tothe Company any taxes that the Company is required by law to collect from Optionee. The Companyreserves the right to deduct from the total number of shares purchased by Optionee pursuant to theexercise of the options the number of shares the fair market value of which equals any taxwithholding obligation that the company has upon Optionee’s exercise of the option. The Companyalso reserves the right to require that any such taxes be remitted to the Company from the proceedsof the sale of any stock acquired by Optionee through exercise of the option by any stock brokereffecting such sale.

     13. Continued Employment. Nothing contained herein shall be construed as conferringupon the Optionee the right to continue in the employ of the Company or any of its subsidiaries asan executive or in any other capacity.

     14. Parties to Agreement. This Agreement and the terms and conditions herein setforth are subject in all respects to the terms and conditions of the Plan, which are controlling.All decisions or interpretations of the Board and of the Committee shall be binding and conclusiveupon Optionee or upon Optionee’s executors or administrators upon any question arising hereunder orunder the Plan. This Agreement will constitute an agreement between the Company and the Employeeas of the date first above written, which shall bind and inure to the benefit of their respectiveexecutors, administrators, successors and assigns.

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     15. Modification. No change, termination, waiver or modification of this Agreementwill be valid unless in writing and signed by all of the parties to this Agreement.

     16. Consent to Jurisdiction. Optionee hereby consents to the jurisdiction of anystate or federal court located in the county in which the principal executive office of the Companyis then located for purposes of the enforcement of this Agreement and waives personal service ofany and all process upon Optionee. The Optionee waives any objection to venue of any actioninstituted under this Agreement.

     17. Notices. All notices, designations, consents, offers or any other communicationsprovided for in this Agreement must be given in writing, personally delivered, or by facsimiletransmission with an appropriate written confirmation of receipt, by nationally recognizedovernight courier or by U.S. mail. Notice to the Company is to be addressed to its then principaloffice. Notice to the Optionee or any transferee is to be addressed to his/her/its respectiveaddress as it appears in the records of the Company, or to such other address as may be designatedby the receiving party by notice in writing to the Secretary of the Company.

     18. Further Assurances. At any time, and from time to time after executing thisAgreement, the Optionee will execute such additional instruments and take such actions as may bereasonably requested by the Company to confirm or perfect or otherwise to carry out the intent andpurpose of this Agreement.

     19. Provisions Severable. If any provision of this Agreement is invalid orunenforceable, it shall not affect the other provisions, and this Agreement shall remain in effectas though the invalid or unenforceable provisions were omitted. Upon a determination that any termor other provision is invalid or unenforceable, the Company shall in good faith modify thisAgreement so as to effect the original intent of the parties as closely as possible.

     20. Captions. Captions herein are for convenience of reference only and shall not beconsidered in construing this Agreement.

     21. Entire Agreement. This Agreement represents the parties’ entire understanding andagreement with respect to the issuance of the option, and each of the parties acknowledges that ithas not made any, and makes no promises, representations or undertakings, other than thoseexpressly set forth or referred to therein.

     IN WITNESS WHEREOF, the parties agree to the terms and conditions stated herein by signing andreturning to the Company the attached copy hereof.

         
  GOODRICH CORPORATION
 
       
  By:    
       
      Vice President
Accepted by:
       
 
       
 
       
 
       
(Employee’s name)
       

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