Exhibit 10.1

PRECISION CASTPARTS CORP.

NONSTATUTORY STOCK OPTION AGREEMENT

THIS AGREEMENT is made as of the “Grant Date”, between Precision Castparts
Corp., an Oregon corporation (the “Company”), and Optionee (“Optionee”). Grant
date, optionee name, number of shares, and grant price are shown on the Notice
of Grant of Stock Option and Option Agreement furnished to each Optionee.

Pursuant to the Precision Castparts Corp. 2001 Stock Incentive Plan (the
“Plan”), the Board of Directors has voted in favor of granting to the Optionee
an option to purchase Common Stock of the Company on the terms set forth below.
In consideration of the promises and mutual covenants herein contained, the
Company and the Optionee agree as follows:

1. Grant. The Company hereby grants to the Optionee upon the terms and
conditions hereinafter stated the right and option (the “Option”) to purchase
all or any part of an aggregate number of shares of the Company’s authorized but
unissued Common Stock at a grant price. The Option is a Nonstatutory Stock
Option and is not an Incentive Stock Option, as defined in Section 422A of the
Internal Revenue Code, as amended. Under the conditions set forth in paragraph
2.5, the Optionee’s right to exercise the Option shall terminate and in
substitution therefor the Optionee shall have the right to exercise a stock
appreciation right.

2. Terms of Option. The Option is granted upon the following terms:

2.1 Duration of the Option. Subject to reductions in the Option period as
hereinafter provided in the event of termination of employment or death of the
Optionee, the Option shall continue in effect for a period of ten (10) years
from the date hereof.

2.2 Time of Exercise. Except as provided in paragraph 2.5, the Option may be
exercised from time to time beginning one year after the date hereof to the
extent the Option has become vested. Twenty-five percent of the shares subject
to the Option shall become vested one year after the date of this Agreement and
an additional 25% shall become vested each year thereafter. If the Optionee does
not exercise the Option in any one year for the full number of shares to which
the Optionee is entitled, the rights shall be cumulative and the Optionee may
exercise the Option for such shares in any subsequent year during the term of
the option.

2.3 Limitations on Right to Exercise. Except as provided in paragraph 2.5, the
Option may not be exercised unless at the time of such exercise the Optionee is
employed by the Company or any subsidiary of the Company and shall have been so
employed continuously since the date such option was granted. Absence on leave
or on account of illness or disability under rules established by the Board of
Directors shall not, however, be deemed an interruption of employment for this
purpose.

 

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2.4 Nontransferability. The Option is nonassignable and non-transferable by the
Optionee except by will or by the laws of descent and distribution of the state
or country of the Optionee’s domicile at the time of death, and is exercisable
during the Optionee’s lifetime only by the Optionee.

2.5 Termination of Employment; Change of Control.

(a) In the event the employment of the Optionee by the Company or by any parent
or subsidiary of the Company is terminated for any reason, voluntarily or
involuntarily, with or without cause, other than in the circumstances specified
in subsection (b) or (c) below, the Option held by the Optionee may be exercised
at any time prior to its expiration date or the expiration of six months after
the date of such termination of employment, whichever is the shorter period, but
only if and to the extent the Optionee was entitled to exercise the Option on
the date of such termination.

(b) In the event the Optionee’s employment is terminated because of death, the
Option held by the Optionee may be exercised at any time prior to its expiration
date or the expiration of twelve months after the date of death, whichever is
the shorter period, but only if and to the extent the Optionee was entitled to
exercise the option on the date of death. The Option shall be exercisable only
by the person or persons to whom the Optionee’s rights under the Option shall
pass by the Optionee’s will or by the laws of descent and distribution of the
state or country of the Optionee’s domicile at the time of death. In the event
the Optionee’s employment is terminated by retirement on or after December 31,
2008, the Option may be exercised with respect to all remaining shares subject
thereto, free of the vesting requirements of paragraph 2.2 at any time prior to
its expiration date or the expiration of one year after the date of death of the
Optionee following termination of employment, whichever period is shorter. If
the Optionee’s employment is terminated by retirement prior to December 31,
2008, the Option may be exercised at any time prior to the expiration of twelve
months after the date of such termination of employment, but only if and to the
extent the Optionee was entitled to exercise the Option on the date of
termination. In the event of termination of employment because of total
disability, the Option may be exercised at any time prior to the expiration date
of the Option or six months after the date of such termination of employment,
whichever is the shorter period but only if and to the extent the Optionee was
entitled to exercise the Option on the date of termination. The term “total
disability” means a mental or physical impairment which is expected to result in
death or which has lasted or is expected to last for a continuous period of 12
months or more and which causes the optionee to be unable, in the opinion of the
Company and two independent physicians, to perform his or her duties as an
employee of the Company and to be engaged in any substantial gainful activity.
Total disability shall be deemed to have occurred on the first day after the
Company and the two independent physicians have furnished their opinion of total
disability to the Company.

 

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(c) Acceleration in Certain Events. Notwithstanding any other provisions of this
Agreement, a special acceleration (“Special Acceleration”) of the Option shall
occur and the Option shall immediately become exercisable in full at any time
when any one of the following events has taken place:

(1) The shareholders of the Company approve one of the following (“Approved
Transactions”): (A) any consolidation, merger or plan of exchange involving the
company (“Merger”) pursuant to which Common Stock would be converted into cash;
or (B) any sale, lease, exchange or other transfer (in one transaction or a
series of related transaction) of all or substantially all of the assets of the
Company; or (C) the adoption of any plan or proposal for the liquidation or
dissolution of the Company; or (D) any merger, consolidation or plan of exchange
which results in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) 50% or less of
the combined voting power of the voting securities of the company or such
surviving entity outstanding immediately after such merger, consolidation or
exchange; or (E) any merger, consolidation or plan of exchange effected to
implement a recapitalization of the Company (or similar transaction) in which a
person acquires more than 20% of the combined voting power of the Company’s then
outstanding securities; or

(2) A tender or exchange offer, other than one made by the Company, is made for
Common Stock (or securities convertible into Common Stock) and such offer
results in a portion of those securities being purchased and the offeror after
the consummation of the offer is the beneficial owner (as determined pursuant to
Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)), directly or indirectly, of more than 20 percent of the outstanding
Common Stock; or

(3) Any person is or becomes the beneficial owner of more than 20 percent of the
Company’s outstanding Common stock; or

(4) During any period of two consecutive years, individuals who at the beginning
of such period constituted a majority of the Board of Directors cease for any
reason to constitute a majority thereof unless the nomination or election of
such new directors was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning of such
period.

All options that are accelerated pursuant to this paragraph 2.5(c) shall
terminate upon the dissolution of the Company or upon the consummation of any
Merger pursuant to which Common Stock would be converted to cash. The terms used
in this paragraph 2.5(c) and not defined elsewhere in this Agreement shall have
the same meanings as such terms have in the Exchange Act and the rules and
regulations adopted thereunder.

(d) In the event of death or termination of employment of the Optionee, to the
extent the Option shall not have been exercised within the limited periods
provided above, all further rights to purchase shares pursuant to the Option
shall cease and terminate at the expiration of such periods.

2.6 Purchase of Shares. Shares may be acquired pursuant to the Option only upon
receipt by the Company of written notice of exercise signed by the Optionee. In
the notice, the Optionee shall specify the date the Option being exercised was
granted, the number of shares covered by the Option, the Option price, the
number of shares as to which the Option is being exercised, the form of payment
to be used as prescribed below, and, unless in the opinion of counsel for the
Company such a representation is not required in order to comply with the
Securities Act of 1933, as amended, containing a representation that it is the
Optionee’s

 

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present intention to acquire the shares for investment and not with a view to
distribution. Exercise of all or part of the Option constitutes a binding
contract between the Company and the Optionee. The Optionee shall make payment
in full for the shares covered by such exercise in cash, in shares of stock of
the Company previously acquired and held for not less than one year by the
Optionee, valued at fair market value as determined by the Board of Directors,
or in any combination of cash and such shares of stock of the Company. If the
Optionee elects to make full or partial payment in shares of stock, the Optionee
shall deliver duly endorsed certificates representing such shares with the
notice of exercise, or make alternate arrangements for delivery of the shares
that are satisfactory to the Company, in its discretion. If the Optionee elects
to make full or partial payment in cash, such payment shall be made in fully
collected funds at the time of exercise provided that if the Optionee is
executing an order for immediate sale of the shares acquired pursuant to the
Option through a registered broker dealer, the Optionee may make such payment by
delivering to the Company with the notice of exercise (i) a personal check for
the exercise price and any applicable withholding taxes, which check shall be
honored by the bank upon which it is drawn within five business days from the
date of exercise, or such lesser number of business days equal to the settlement
period for broker transactions under applicable law at the date of exercise, and
(ii) an authorization and assignment for security purposes in form satisfactory
to the Company pursuant to which the Company is entitled to obtain payment of
the exercise price and any applicable withholding taxes from the proceeds of
sale of the shares in the event the Optionee’s check is not timely honored. Upon
receipt of full payment of the exercise price and applicable taxes, the Company
will issue certificate(s) representing the shares purchased. No shares shall be
issued until full payment therefor has been made. The exercise and payment
procedures set forth in this Section 2.6 are subject to change from time to time
by the Company upon written notice to the Optionee.

2.7 Suspension of the Company’s Form S-8 Registration Statements. If, as of
either the end of the Option term specified in Section 2.1 or the end of any of
the post-termination exercise periods specified in Section 2.5, sales of Common
Stock pursuant to the Company’s Form S-8 registration statements are suspended
because the Company is delinquent in its filings with the Securities and
Exchange Commission, the Option period or the post-termination exercise period,
as applicable, shall be automatically extended to the date that is 90 days after
the end of the suspension of sales pursuant to the Company’s S-8 registration
statements.

3. Substitution of Stock Appreciation Right. The Board of Directors or the
Compensation Committee of the Board of Directors may at any time, in its sole
discretion and without the consent of the Optionee, provide that a stock
appreciation right shall be substituted for the Option. The number of shares
subject to the stock appreciation right shall be equal to the number of Option
shares that remain subject to the Option and as to which the Option has not been
exercised. The substitution shall become effective upon written notification
from the Company to the Optionee. Upon such notification, the Option shall
terminate and shall no longer be exercisable. In substitution for the Option and
subject to the same terms and conditions of this Agreement applicable to the
Option, Optionee shall be entitled to exercise a stock appreciation right,
subject to the following terms and conditions:

3.1 Duration of Stock Appreciation Right. The duration of the stock appreciation
right shall be the same as the Option as provided in paragraph 2.1.

 

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3.2 Time of Exercise; Limitations on Right to Exercise; Termination of
Employment; Change of Control. The stock appreciation right shall be exercisable
only to the extent that the Option would have been exercisable and only on the
conditions applicable to the Option, including paragraphs 2.2, 2.3 and 2.5.

3.3 Nontransferability. The stock appreciation right is nonassignable and
non-transferable except by will or by the laws of descent and distribution of
the state or country of the Optionee’s domicile at the time of death and is
exercisable during the Optionee’s lifetime only by the Optionee.

3.4 Exercise of Stock Appreciation Right. The stock appreciation right shall
entitle the Optionee, upon exercise, to receive from the Company in exchange
therefor an amount equal in value to the excess of the fair market value on the
date of exercise of one share of Common Stock of the Company over the Option
price per share (as set forth in the Notice of Grant of Stock Option and Option
Agreement), multiplied by the number of shares covered by the stock appreciation
right, or portion thereof, that is surrendered. No stock appreciation right
shall be exercisable at a time that the amount determined under this
subparagraph is negative. Payment by the Company upon exercise of a stock
appreciation right shall be made in Common Stock valued at fair market value.
For this purpose, the fair market value of the Common Stock shall be the closing
price of the Common Stock last reported before the time of exercise, or such
other value of the Common Stock as specified by the Board of Directors.

3.5 Fractional Shares. No fractional shares shall be issued upon exercise of a
stock appreciation right. In lieu thereof, cash may be paid in an amount equal
to the value of the fraction or, if the Board of Directors or Compensation
Committee of the Board of Directors shall determine, the number of shares may be
rounded downward to the next whole share.

4. Withholding Tax. The Optionee shall, upon notification of the amount due, if
any, and prior to or concurrently with delivery of the certificates representing
the shares with respect to which the Option (or stock appreciation right if
paragraph 3 is applicable) was exercised, pay to the Company amounts necessary
to satisfy any applicable federal, state, and local withholding tax
requirements. If additional withholding becomes required beyond any amount
deposited before delivery of the certificates, the Optionee shall pay such
amount to the Company on demand. If the Optionee fails to make any payment
required to be made by the Optionee hereunder, the Company may withhold such
amount from any funds owed by the Company to the Optionee.

5. Changes in Capital Structure. In the event that the outstanding shares of
Common Stock of the Company are hereafter increased or decreased or changed into
or exchanged for a different number or kind of shares or other securities of the
Company or another corporation, by reason of any reorganization, merger,
consolidation, recapitalization, reclassification, stock split-up, combination
of shares, or dividend payable in shares, the Board of Directors shall make
appropriate adjustments in the number and kind of shares for purchase pursuant
to the Option (and the stock appreciation right, if paragraph 3 is applicable)
and the corresponding Option price, or, in its discretion, select one of the
alternative treatments of outstanding options and stock appreciation rights
permitted under Section 12 of the Plan. Any such adjustment made by the Board of
Directors shall be conclusive.

 

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6. Approvals. The obligations of the Company under this Agreement are subject to
the approval of the Plan by the shareholders of the Company in accordance with
Oregon law and to the approval of such state or federal authorities or agencies,
if any, as may have jurisdiction in the matter. The Company will use its best
efforts to take such steps as may be required by state or federal law or
applicable regulations, including rules and regulations of the Securities and
Exchange Commission and any stock exchange on which the Company’s shares may
then be listed, in connection with the issuance or sale of any shares acquired
upon the exercise of the Option (a stock appreciation right if paragraph 3 is
applicable).

7. Employment Rights. Nothing in the Plan or this Agreement shall confer upon
the Optionee any right to be continued in the employment of the Company or any
subsidiary of the Company, or shall interfere in any way with the right of the
Company or any subsidiary by whom the Optionee is employed to terminate the
Optionee’s employment at any time, for any reason, with or without cause.

8. Binding Upon Successors. This Agreement shall be binding upon and shall inure
to the benefit of any successor or successors of the Company but except as
hereinabove provided the Option (and the stock appreciation right if paragraph 3
is applicable) herein granted shall not be assigned or otherwise disposed of by
the Optionee.

 

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Nonstatutory Stock Option Agreement

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