EXHIBIT 10.51
NOTICE OF AWARD
To:

     
From:
  Human Resources and Compensation Committee of the Board of Directors
(“Committee”)
 
   
Subject:
  ESCO Technologies Inc. 2001 Stock Incentive Plan (“Plan”) — 2009 Award

1. Award. The Committee has awarded to you                      shares of
Performance-Accelerated Restricted Stock under the terms of the Plan (“Award”)
which entitles you to receive                      shares of Common Stock of the
Company upon satisfaction of the terms hereinafter set forth. The Award is
subject to all of the terms of the Plan, a copy of which has been delivered to
you.
2. Terms. The following are the terms of the Award:
          (a) Notwithstanding (b), below if, during the Period of the Award, the
Average Value Per Share of Company Stock reaches the amount set forth in column
(A), a percentage of the Award will be accelerated equal to the amount set forth
under column (B) subject to the limitations set forth in (c) and provided you
comply with the terms of the remainder of this Notice of Award.

          A   B If the Average Value   The Cumulative Per Share of Company  
Percent of Award Stock reaches:   Accelerated shall be:
$51.75 or more
    100 %
$48.40
    50 %
$45.00
    0 %

          (b) If you are still employed by the Company or a subsidiary of the
Company on September 30, 2013 and have been continuously so employed since the
date hereof, you will earn 100% of the portion of the Award not yet accelerated
provided you comply with the requirements of paragraph 3.
          (c) The following additional terms will apply to the Award:
               (i) No portion of this Award may be accelerated prior to
October 1, 2010. One hundred percent (100%) of the total Award may be
accelerated by the end of the Fiscal Year ending September 30, 2013.
               (ii) Once a portion of the Award is accelerated under
subparagraph (a), you must remain employed with the Company or a subsidiary of
the Company until the March 31st

 

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following the end of the Fiscal Year in which that portion of the Award is
accelerated. If you terminate employment (voluntarily or involuntarily) prior to
such time, you will forfeit that portion of the Award. Provided, however, that
if your employment is terminated on account of death, or total and permanent
disability the foregoing employment requirement shall not apply.
               (iii) If there is a Change of Control (as defined in the Plan)
and you are employed by the Company on the date of the Change of Control, the
employment requirement of subparagraph (ii) shall cease to apply to the portion
of the Award which is accelerated or earned and the number of shares
representing that portion of the Award which is accelerated or earned as of the
date of the Change of Control shall be distributed to you. In addition, the
portion of the Award which is not yet accelerated or earned shall be determined
and distributed to you at the end of the Fiscal Year in which the Change of
Control occurred provided you are still employed on such date, in lieu of all
other provisions of this Award. If you are not employed by the Company as of the
end of the foregoing Fiscal Year, no such distribution will be made; provided,
however, that if you are involuntarily terminated for reasons other than Cause
or if you terminate for Good Reason the remaining shares not yet accelerated or
earned shall be distributed in full upon such termination of employment.
                    (a) Notwithstanding the foregoing provisions of this
subparagraph (iii), in the event a certified public accounting firm designated
by the Committee (the “Accounting Firm”) determines that any payment (whether
paid or payable pursuant to the terms of this Award or otherwise and each such
payment hereinafter defined as a “Payment” and all Payments in the aggregate
hereinafter defined as the “Aggregate Payment”), would subject you to tax under
Section 4999 of the Internal Revenue Code of 1986 (“Code”) then such Accounting
Firm shall determine whether some amount of payments would meet the definition
of a “Reduced Amount”. If the Accounting Firm determines that there is a Reduced
Amount, payments shall be reduced so that the Aggregate Payments shall equal
such Reduced Amount. For purposes of this subparagraph, the “Reduced Amount”
shall be the largest Aggregate Payment which (a) is less than the sum of all
Payments and (b) results in aggregate Net After Tax Receipts which are equal to
or greater than the Net After Tax Receipts which would result if Payments were
made without regard to this subsection (e). “Net After Tax Receipt” means the
Present Value (defined under Section 280G(d)(4) of the Code) of a Payment net of
all taxes imposed on you under Section 1 and 4999 of the Code by applying the
highest marginal rate under Section 1 of the Code.
                    (b) As a result of the uncertainty in the application of
Section 4999 of the Code at the time of the initial determination of the
Accounting Firm hereunder, it is possible that Payments will be made by the
Company which should not have been made (the “Overpayments”) or that additional
Payments which the Company has not made could have been made (the
“Underpayments”), in each case consistent with the calculations of the
Accounting Firm. In the event that the Accounting Firm, based either upon
(A) the assertion of a deficiency by the Internal Revenue Service against the
Company or you which the Accounting Firm believes has a high probability of
success or (B) controlling precedent or other substantial authority, determines
that an Overpayment has been made, any such Overpayment shall be treated for all
purposes as a loan to you which you shall repay to the Company together with
interest at the applicable Federal rate provided for in Section 7872(f)(2)(A) of
the Code; provided, however, that no amount shall be payable by you to the
Company if and to the extent such payment would not reduce the amount which is
subject to taxation under Section 1 and Section 4999 of the Code or if the
period of limitations for assessment of tax has expired. In the

 

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event that the Accounting Firm, based upon controlling precedent or other
substantial authority, determines that an Underpayment has occurred, any such
Underpayment shall be promptly paid by the Company to you together with interest
at the applicable Federal rate provided for in Section 7872(f)(2)(A) of the
Code.
3. Share Ownership Requirements. You are expected to own shares of Common Stock
with a fair market value equal to a multiple of your total cash compensation
(the “Share Ownership Requirement”). If you do not currently meet your Share
Ownership Requirement, you must retain 50% of any Performance-Accelerated
Restricted Stock Award distribution which you receive under Paragraph 2(a),
above until the Share Ownership Requirement is satisfied. Thereafter you must
maintain ownership of shares of Common Stock so that the Share Ownership
Requirement remains satisfied. The satisfaction of the requirements of this
Paragraph 3 will be reviewed periodically as determined by the Committee.
4. Definitions. For purposes of the Award, the following terms shall have the
following meanings:
          (a) “Average Value Per Share” shall mean the average for any
consecutive 30 day trading period in which Company Stock is traded of the daily
closing prices of Company Stock on the New York Stock Exchange.
          (b) “Cause” shall mean:
               (i) The willful and continued failure to substantially perform
your duties with the Company or one of its subsidiaries (other than any such
failure resulting from incapacity due to physical or mental illness), after a
written demand for such performance is delivered to you by ESCO’s Board of
Directors or their delegate which specifically identifies the manner in which
such ESCO’s Board of Directors or their delegate believes that you have not
substantially performed your duties; or
               (ii) The willful engaging in (A) illegal conduct (other than
minor traffic offenses), or (B) conduct which is in breach of your fiduciary
duty to the Company or one of its subsidiaries and which is demonstrably
injurious to the Company or one of its subsidiaries, any of their reputations,
or any of their business prospects. For purposes of this subparagraph (ii) and
subparagraph (i) above, no act or failure to act on your part shall be
considered “willful” unless it is done, or omitted to be done, by you in bad
faith or without reasonable belief that your action or omission was in the best
interests of the Company or one of its subsidiaries. Any act, or failure to act,
based upon authority given pursuant to a resolution duly adopted by the Board of
Directors of the Company or based upon the advice of counsel for the Company
shall be conclusively presumed to be done, or omitted to be done, by you in good
faith and in the best interests of the Company or one of its subsidiaries;
The cessation of your employment shall not be deemed to be for “Cause” unless
and until there shall have been delivered to you a written notice that in the
Board of Directors’ or their delegate’s opinion you are guilty of the conduct
described in subparagraph (i) or (ii) above, and specifying the particulars
thereof in detail.
          (c) “Company Stock” shall mean common stock of the Company.

 

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          (d)“Fiscal Year” shall mean the fiscal year of the Company which, as
of the date hereof, is the twelve month period commencing October 1 and ending
September 30.
          (e) “Good Reason” shall mean:
               (i) Requiring you to be based at any office or location more than
50 miles from your office or location as of the date of the Change of Control;
               (ii) The assignment to you of any duties inconsistent in any
respect with your position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities as of the date of the
Change of Control or in conjunction with a Change in Control any action by the
Company or any of its subsidiaries which results in a diminution in such
position, authority, duties or responsibilities, excluding for this purpose an
action taken by the Company or one of its subsidiaries, to which you object in
writing by notice to the Company within 10 business days after you receive
actual notice of such action, which is remedied by the Company or one of its
subsidiaries promptly but in any event no later than 5 business days after you
provided such notice, or
               (iii) The reduction in your total compensation and benefits below
the level in effect as of the date of the Change of Control.
          (f) “Period of the Award” means the period commencing October 1, 2010
and ending on September 30, 2013.
5. Parallel Incentive. The Committee may, but is not obligated to, authorize a
payment of a portion of the Award based upon its discretionary evaluation of the
Company’s financial performance during the Period of the Award even if the
foregoing objectives are not fully met. Examples of performance measures the
Committee may consider include, but are not limited to, cash flow, earnings,
sales and margins.
6. Medium of Payment. The Committee shall direct that sufficient shares of
Common Stock of the Company shall be withheld from any distribution hereunder to
satisfy the Company’s tax withholding requirements in respect of such
distribution.
7. Restrictions. You agree that for the period ending two (2) years after the
expiration of the Period of the Award, you will not, as an individual or as a
partner, employee, agent, advisor, consultant or in any other capacity of or to
any person, firm, corporation or other entity, directly or indirectly, other
than as a 2% or less shareholder of a publicly traded corporation, do any of the
following:
     (a) carry on any business or become involved in any business activity,
which is (i) competitive with the business of the Company (or a subsidiary or
joint venture of the Company), as presently conducted and as said business may
evolve in the ordinary course, and (ii) a business or business activity in which
you were engaged in the course of your employment with the Company (or a
subsidiary or joint venture of the Company);

 

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     (b) hire, or assist anyone else to hire, any employee of the Company (or
any subsidiary or joint venture of the Company), or seek to persuade, or assist
anyone else to seek to persuade, any employee of the Company (or any subsidiary
or joint venture of the Company), to discontinue employment with the Company (or
any subsidiary or joint venture of the Company);
     (c) induce or attempt to induce, or assist anyone else to induce or attempt
to induce, any customer of the Company (or any subsidiary or joint venture of
the Company), to discontinue its business with the Company (or with any
subsidiary or joint venture of the Company), or disclose to anyone else any
confidential information relating to the identities, preferences, and/or
requirements of any such customer; or
     (d) engage in any other conduct inimical, contrary or harmful to the
interests of the Company (or any subsidiary or joint venture of the Company),
including, but not limited to, conduct related to your employment, or violation
of any Company policy.
In the event of a breach or threatened breach of this Paragraph 7 the Company
shall be entitled, in addition to any other legal or equitable remedies it may
have, to temporary, preliminary and permanent injunctive relief restraining such
breach or threatened breach. You hereby expressly acknowledge that the harm
which might result as a result of any noncompliance by you would be largely
irreparable, and you agree that if there is a question as to the enforceability
of any of the provisions of this Agreement, you will abide by the Agreement
until after the question has been resolved by a final judgment of a court of
competent jurisdiction.
8. Recoupment. In the event of any conduct on your part which is knowingly
fraudulent, deliberately dishonest or constitutes willful misconduct and such
conduct causes financial harm to the Company (as determined by the Company), you
shall forfeit this Award; and in the event payment has already been made under
this Award, you shall transfer to the Company, within 30 days after notice and
demand by the Company, (a) any amount of cash paid to you under this Award,
(b) any shares of stock transferred to you under this Award, and (c) the profit
on any sales of such shares.
9. Choice of Law. This Agreement shall be construed and administered in
accordance with the laws of the State of Missouri without regard to the
principles of conflicts of law which might otherwise apply. Any litigation
concerning any aspect of this Agreement shall be conducted in the State or
Federal Courts in the State of Missouri.
10. Amendment. The Award may be amended by written consent between the Company
and you.

 

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Executed this       day of                     , 20       .

                  ESCO TECHNOLOGIES INC.       AGREED TO AND ACCEPTED:    
 
               
By:
               
 
          Vice President      
 
          Participant    
 
               
ATTEST:
               
 
               
 
       Secretary